20th Parliament · 1st Session
The President (Senator the Hon. A. JI. McMullin) took the chair at 11.30 a.m., and read prayers.
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– Is the Minister for National Development aware that there are grave fears among coal-miners on the northern coal-fields of New South Wales that there is likely to be substantial unemployment in the industry? Is he also aware that yesterday a conference of representatives of the miners’ federation, coal-owners and the Joint Coal Board was held to discuss this question? If the Minister has any information concerning that conference, will he inform the Senate of the plans that the Government has in mind for stabilizing the industry and preventing unemployment in it?
– Perhaps the miners, like the machinery of the Joint Coal Board, could be put in crates.
– T can appreciate Senator Ashley’s envy in this connexion, because when he was the responsible Minister he just could not obtain sufficient coal for our requirements. Accordingly, he now feels a little upset because we have sufficient coal and the honorable senator is trying to find a point of vantage from which to attack this Government. Senator Arnold has asked whether a conference was held yesterday. I am informed that a conference of interested parties in the industry was held in an endeavour to arrive at an equitable solution of a problem that has now arisen. I refer to the fact that coal production in the Newcastle area is running in excess of immediate requirements by between 10,000 and 20,000 tons a week. This matter may very easily be oversimplified. It is not merely a case of dealing with coal as coal, because there are several varieties of that commodity. While production is in excess of requirements at Newcastle, it is less than the requirements of the steel industry on the south coast of New South Wales. There are still some vacancies in the industry in the Newcastle area, and although, by and large, there is plenty of man-power available there, on the south coast there is a grievous shortage of man-power. On the south coast, the vacancies in the mines range from 300 to probably 450.
– Not at present.
– I have the advantage of possessing the official figures that are compiled by the industry and if the honorable senator is referring to the present position, he is wrong.
– There are not 400 vacancies in the mines on the south coast.
– One of the immediate difficulties is that the Communists in charge of that section of the miners’ federation have aimed their darts at the steel industry and are not providing sufficient men to man the south coast mines to enable them to supply the coking coal that is required for the steel industry. If the honorable senator does not accept that statement as a mie indication of the situation, he is out of touch with realities. If the miners’ federation would open its books, sufficient men could be recruited to man the mines on the south coast. It would be possible then to get the coking coal required for the steel works and provide additional employment in all the industries that depend upon the supply of steel. We have made great progress in industrial relations in the coal-mining industry and have done much to reduce industrial disturbances. If the coal miners would throw out the Communists and elect moderate leaders, we would be able to make further progress in that direction. The question that was asked by the honorable senator is an important one and deserves a fair answer. At the moment, we are considering the correct attitude to take in the present circumstances. I ask all honorable senators who have any influence in this matter to repudiate any suggestion that there is any possibility of large-scale unemployment in the coal-mining industry. I have no doubt that the Government will help to improve the situation by stockpiling as it did last year. We will stockpile to some extent, but it is an expensive operation and we are entitled to expect some co-operation from the industry and from consumers of coal. They should not continue to carry lower stocks than they need because they know they can draw upon the stockpile. If they do so, they can fairly be asked to pay the cost to the Government of stockpiling coal. While admitting all that the men have done in maintaining the coal production programme and all that the owners have done in developing the mines, it is not unreasonable to expect that the men, as a quid pro quo, will take any action that may be proper to ensure that the south coast mines produce adequate supplies of coking coal. The subject is of major importance, and I do not profess to have dealt with it adequately, but- 1 have given the Senate as much information as I can in the circumstances.
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– I ask the Minister for Trade and Customs whether the attention of the Government has been directed to the statement by Mr. Irish, a director of Associated Newspapers Limited and a leading Sydney accountant, that when be was in Canberra on Sunday, the 30th August, he learned that company tax was to be reduced by 2s. in the £1 - a reduction in respect of that company from 9s. to 7s. in the £1 - in the budget that was to be presented to the Parliament? Is it not a fact that Mr. Irish admitted that this was an important consideration in evaluating the earnings of Associated Newspapers Limited in relation to the deal then pending with the Sydney Morning Herald, which was applying for consent to take up 678,674 unissued shares in Associated Newspapers Limited? Will the Government probe this matter fully in order to ascertain the sources from which Mr. Irish obtained his information while he was in Canberra and also who was responsible for this serious disclosure of budget proposals? Will the Government take the earliest opportunity to ascertain whether this matter was discussed on the Sunday to which I have referred between Mr. Irish and the Commonwealth Actuary, Mr. Balmford, who is the delegate of the Treasurer on capital issues control? If Mr. Balmford was not the person who supplied that information, will the Government ascertain whether or not the press delegation that visited Canberra was in close contact with a senior member of the Government - not the Treasurer - who intervened in this matter?
– It is rather extraordinary how the honorable senator with all his experience gets carried away by newspaper reports. The question which he has just asked and also the question which he asked on this matter yesterday do not do him justice. On both occasions, he has cast a slur upon Mr. Balmford, who is one of the most highly regarded and most trusted and trustworthy of public servants. Not only under this Government, but also under the previous Government, Mr. Balmford carried out very onerous and exacting work with complete and absolute integrity, and it is most unfair for any honorable senator, under cover of parliamentary- privilege, to cast any aspersion even indirectly upon his impeccable record as a public servant. The honorable senator, in this question and in the question which he asked yesterday implied that a prominent member of the present Government was instrumental in granting these consents expeditiously. I tell the honorable senator here, as I should tell him anywhere, that such an allegation is completely unfounded. This matter was not discussed with any member of the Cabinet antecedent to the application being granted ; and any suggestion to the contrary is unworthy of the honorable senator. Instead of relying on rumours and newspaper reports, he should, if he is interested in preserving the dignity of the Parliament, ascertain the facts before making allegations of this kind.
– Will the Minister for Trade and Customs inform the Senate whether the Capital Issues Board transacts business every day in the week, including Sunday? Will the Minister inform the Senate when this departure from the ordinary and regular practice of the Capital Issues Board commenced and on whose authority it was initiated? Is it usual for an application which affects many persons with varied and conflicting interests to be received, considered by the board and determined on the one day? Will the Government give to workers, particularly returned soldiers, the assurance that their applications will be dealt with with the same rapidity as the application of Associated Newspapers Limited was dealt with? Was this extraordinary action initiated by Mr. Balmford or was it taken at the direction of the Government?
– I thought I made it clear earlier that, antecedently to this application being granted, no discussion took place between Mr. Balmford and any Minister. So far as working on Sundays is concerned, it is likely that this Government works much harder than Senator Ashley was accustomed to work when he was a member of the Government. Many Ministers often work in their offices on Sundays. We- have some sense of obligation to the community. We do not serve by the clock. I am sure that senior public servants often worked on Sundays when the Labour Government was in office. We are very fortunate in having such a devoted Public Service and occasionally a matter of great urgency is dealt with in my office and in the offices of otter Ministers on a Sunday. I am frequently to be found in my office on a Sunday if the honorable senator would like to see me on that day.
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– I ask the Minister representing the Treasurer whether the Australian Loan Council determines rates of interest in respect of all Government loan issues. Does the council determine, or approve, rates of interest applicable to loan issues of semigovernmental instrumentalities? Did the council recently decide that a rate of interest of 4£ per cent, shall attach to the £50,000,000 loan which is to be launched in the near future? How long has that rate applied to Government loans? Does the retention of that rate of 4£ per cent, indicate that the Labour Premiers of Western Australia, Queensland, New South Wales, Tasmania and Victoria declined to cast their votes in the council in order to secure a reduction on the rate of interest?
– I think it is common knowledge that interest rates are fixed by the Loan Council and that when they are under consideration there is consultation between members of the council. It is common knowledge also, I believe, that there is no fixed term for any rate of interest and that when a loan is being considered, the Loan Council reviews the money market and’ decides what interest rate shall be fixed for that loan. It is beyond the field of argument that the interest rates offered for the present loan have been fixed with the full knowledge and approval of State Labour governments. They are the authorities who will receive the money when it ‘ is raised. Labour critics of interest rates therefore, should remember that the State Labour governments are’ consenting and indeed cooperating parties in offering those interest rates to the public.
– Does the Minister for Trade and Customs consider that the fact that the share market has now fallen right back to where it was before the budget was announced, denotes that entrepreneurs and the people of Australia generally have no confidence in this Government-? If he does not, what does he consider that this trend denotes?
– I am no’, interested in the stock exchange. If the honorable senator’s investments are falling, there is nothing I can do about it except to suggest that he use better judgment.
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– My attention has been directed to the fact that although only a week has past since the budget was presented, applicants for war service homes finance are being informed that they will have to wait nine months before financial assistance can he given to them. Can the Minister representing the Minister for Social Services, say whether the allocation for war service homes for the current financial year has already been exhausted ? Is it the Government’s policy that applicants foi- war service homes finance must wait until the next financial year before they can receive financial assistance ? If the answers to those questions are in the negative, why did the War Service Homes Division change its policy overnight after the budget had been presented, and inform applicants that they would have to wait for another nine months before they could receive financial assistance? If the change of policy has’been brought about by shortage of funds, will the Government consider making a further grant for war service homes to help ex-servicemen who are finding difficulty in obtaining homes? I refer particularly to ex-servicemen who served overseas.
– When an honorable senator refers in a question to a memorandum of the War Service Homes Division, I must assume that his question is well founded and that he has taken precautions to see that his statements are correct. As I have no personal knowledge of the matter to which he has referred, it is proper that I should ask him to put his question on the notice-paper so that the. Minister concerned may reply to it personally.
– Is the Minister for National Development aware that the Western Australian Government proposes to erect a large block of flats at Subiaco, in Perth, under the Commonwealth and State housing scheme, at an estimated cost of about £500,000 ? I point out that this project will tie up at least that amount of public money in perpetuity, because the rents that will be received will be insufficient to repay the capital outlay. Furthermore, this project will deny to the tenants of the flats the right to purchase their own homes. Is the Minister prepared to inform the Senate of the view of the Australian Government on the proposal?
– There is a import from my department about this proposal on my desk, but I have not yet made decisions on the various related applications. My recollection of the matter is that it is proposed to erect a ten-story block of flats at an estimated cost of’ about £500,000. While I am totally opposed to the proposal at this stage, I reserve the right to alter my opinion after I have considered the departmental report. The Commonwealth and State Housing Agreement was evolved for the purpose of providing homes for families at cheap rentals. The agreement is an expensive proposition for the Government, which supplies at an interest rate of 3 per cent, money which it has to borrow at 44 per cent, on the loan market. The Government takes that action for the purpose of assisting those who are rearing families and in order to provide an opportunity for those people to buy the houses if they .so desire. I can understand the need for the State governments to provide some flat accommodation but it seems to me that a State government should itself provide the necessary finance for a grandiose scheme such as this instead of - subsidizing rentals with Commonwealth funds for which the taxpayer has to pay.
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– Can the Minister representing the Postmaster-General say whether it is a fact that the Government recently acquired a property next to the Burnie Post Office in Tasmania with the object of rebuilding the Burnie Post Office which urgently needs increased facilities? Will the fact that this acquired building is now used by the Engineering Branch of the Postal Department prejudice an early commencement of the erection of the new post office for this thriving town V Will the Minister take steps to expedite the erection of the new post office for which the property was originally acquired?
– I cannot give the honorable senator an answer to his question now, but I shall take the matter up with the Postmaster-General and obtain a reply as soon as possible.
– Will the Minister representing the PostmasterGeneral inform the Senate whether it is a fact, in many instances, that the Postal Department invites public tenders for the construction of new buildings and the carrying out of repairs to existing buildings? If so, does the Government believe that a considerable saving in expenditure will be effected, and that the carrying out of new works, especially the installation of telephones in rural areas, will be expedited? Will this system result in the retrenchment of many permanent employees of the Postal Department?
– I shall refer the honorable senator’s question to the PostmasterGeneral and request a reply at the earliest possible moment.
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– Can the Minister representing the Minister acting for the Minister for Health say why it is that under the arrangement with friendly societies for the payment by the Commonwealth of an extra hospital. benefit of 4s. a day, no provision has been made for juvenile lodge members? Although some of these juvenile members have been paying hospital benefit dues since the inception of the scheme, is it intended that they must join another hospital benefit organization to receive the benefit that is paid by the Commonwealth?
– I shall be very pleased to direct the attention of the Minister acting for the Minister for Health to the honorable senator’s question and obtain a reply for him as soon as possible.
On the 10th September, Senator Ashleyasked the following questions : -
The Minister acting for the Minister for Health has furnished the following information in reply to the honorable senator’s questions: -
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– Will the Minister representing the Minister for Social Services inform the Senate of the number of civilian widows with dependent children under the age of sixteen years who are in receipt of widows’ pensions? What is the average income of those widows? “ What is the present federal basic wage for female workers, and what action is the Government taking to bring the. pensions I have mentioned into line with the federal female basic wage?
– I might return a shaft to the honorable senator by asking her what attempt was made by the party that she supports, when it formed the government of this country, to achieve the objective that she has mentioned? It is all very well for the honorable senator to stand in her place and, with a high degree of irresponsibility, make statements of this kind which are aimed at obtaining a good deal of public sympathy. However, I shall endeavour to obtain the desired information for the honorable senator.
– I rise to order! As the word “ irresponsible “ is offensive to me, I ask that it be withdrawn.
– I must ask the Minister to withdraw the word “ irresponsible “.
– In deference to your ruling, Mr. President, .1 withdraw the term “ irresponsible “, although it accurately described the position.
– Does the Minister representing the Minister for Social Services agree that widows’ pensions were introduced by the Curtin Labour Government in 1941, for the first time in the history of the Commonwealth, although anti-Labour governments were in office for more than 30 years of the 41 years during which the federal system had been in operation to that time? Is it not also a fact that the purchasing power of the pensions, when first introduced, exceeds that of to-day, despite the increased monetary payments?
– Unfortunately, the Minister who represents the Minister for Social .Services has been unexpectedly called away from the chamber. I think that perhaps the honorable senator is correct in saying that the Curtin Government introduced widows’ pensions, which were, perhaps, the only pensions that it, did introduce. During the term of office of the present Government, a great deal has been done to ensure that pensions retained the value they possessed at the end of the Chifley regime.
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– Will the Minister representing the Minister for Transport inform the Senate whether recent representations have been made to the Government by interests in Queensland and other eastern States for the construction of a railway line from Birdum in the Northern Territory to Dajarra in north-west Queensland? While not wishing to discount the value of such a railway, will the Minister give an assurance that the agreement between the South. Australian Government and the Commonwealth Government for the completion of the north-south line from Alice Springs to Birdum will not be given a lower priority or be overlooked?
– The question of the construction of a railway line from Dajarra to Birdum has been under active consideration for some time. In reference to the second part of the honorable senator’s question, I am unable to give the assurance that he has requested.
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– Some time ago the Attorney-General invited suggestions from interested organizations concerning whether the trade marks and designs legislation should be amended. Will the Minister inform the Senate of the progress that has been made in that connexion, and is he in a position to make available to honorable senators some of the statements made to the committee of inquiry which has been established? When does he contemplate introducing such amending legislation? On the subject of copyright, will he inform the Senate whether this Government proposes to ratify the Brussels Convention, and, if so, when? Can he say whether, during the life of the present Parliament, he proposes to introduce legislation in regard to copyright?
– In regard to the trade marks and designs legislation, a committee has been working for some time drafting new legislation. It has heard representations from a number of people who came forward in response to the invitation that I gave publicly. The committee is at present preparing its report which will, I think, include a new draft trade marks act. I am. unable to say, at the present moment, when the report will be completed, but when it is finished it will be made available to the members of this Parliament. Whether that will be during this year, I am not at the moment able to say. With regard to the Copyright Act, it is contemplated that a somewhat similar course of action will be taken, but owing to the fact that our copyright legislation has always been more or less in the same form as is the British legislation, and because certain developments are taking place in Great Britain in that connexion, it is considered desirable to await the outcome of those developments before we follow the same procedure in regard to copyright as we have followed in regard to patents and trade marks. I think I can say definitely that no proposal to amend the Copyright Act will be presented to the Parliament during the current sessional period.
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– Is the Minister for Shipping and Transport aware of the limited facilities available on the east-west train for the storage, chilling and service of Australian table wines? Will he have the existing facilities examined with a view to providing passengers on the train with a more adequate range of Australian wines, particularly as the train is now being used by increasing numbers of persons arriving from overseas, who leave the ship at Fremantle? Will the Minister instruct his purchasing staff to keep in mind the excellence of some of the Western Australian table wines when re-stocking is being undertaken ?
– I think that the Commonwealth Railways Commissioner purchases the best wines available, most of which come from South Australia.
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asked the Minister representing the Treasurer, upon notice -
– The Treasurer has supplied the following answers : -
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asked the Minister representing the Treasurer, upon notice -
– The following reply to the honorable senator’s questions has been supplied by the Treasurer: -
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asked the Minister representing the Treasurer, upon notice -
Australian money market, offering Australian investors from 3) to 4 per cent, for short dated accommodation? If so, will the money all come from the Australian investment pool and will it result in less money being available for Australian firms seeking more capital ‘! When General Motors Acceptance Corporation makes a profit with this new money, will it all be converted into dollars?
– The Treasurer has supplied the following reply to the honorable senator’s questions : -
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Debate resumed from the 16th September (vide page 60), on motion by Senator McLeay -
That the bill be now read a second time.
– ‘ The bill that is now before the Senate seeks to amend the Pearl Fisheries Act. 1952 as amended by the Pearl Fisheries Act 1953. The original legislation on this matter was dealt with in the small hours of the morning in March, 1952, and adequate time for its consideration was not allowed. Defects in the definition of Australian waters became evident after a short while, and one year later, the Government expanded the definition of Australian waters in relation to pearl fisheries, the conservation of fisheries and free swimming fish. Now, eighteen months after the Government first, embarked upon legislation of this kind, the Parliament is asked to widen further the definition of Australian waters. On behalf of the Opposition, I express the view that Australia should assert its authority over, and effectively police, what we know to be Australian waters. That is the considered view of the Opposition and I hope that this third attempt by the Government to define Australian waters will be effective.
In his second-reading speech, the Minister for Shipping and Transport (Senator McLeay) gave to the Senate lengthy details of the negotiations that took place between the Japanese and the Australian Government in relation to pearl fisheries. I sa.y at once that in the circumstances that were outlined by the Minister, it was a very proper action for the Government to break off the negotiations because the attitude of the Japanese showed plainly that they did not propose to negotiate and, in fact, intended to pursue their own free course regardless of the wishes of the Australian Government. But- the Government has brought much of this trouble upon itself. The Japanese peace treaty, which was the subject of very strong criticism, by the Opposition when it was before the Parliament, contains a provision dealing with the question of fisheries. Australia was a signatory to the treaty containing Article 9 which states -
Japan will enter promptly into negotiations with the Allied powers so desiring for the conclusion of bilateral and multilateral agreements providing for the regulation or limitation of fishing and the conservation and development of fisheries on the high seas.
That provision is completely futile because it omits any reference to what shall happen in the event of negotiations failing to reach a conclusion. Unquestionably the clause is defective and the Government should not have accepted it without a condition that in the event of no agreement being reached a.s a result of negotiations, some arbitral body, whether an international court or some other agency of the United Nations, should resolve the matter. An obvious effect is that Australia is paying the penalty for not insisting upon some effective termination of negotiations by providing for such a contingency before signing the Japanese peace treaty. This measure, which deals with pearl fisheries, is urgent and important to Australia in two ways. First, from the economic viewpoint, the industry provides employment for Australians, an opportunity for the investment of Australian capital and a means of earning dollars by the sale of its products. All those features emphasize the economic importance of the industry. In addition, there is unquestionably the aspect of endangering our security by allowing people of other nations to come close to our shores and, as we know in respect of the Japanese, to engage in espionage in our waters. Under the pretext of fishing for pearl shell near our shores prior to the outbreak of the recent war, the Japanese unquestionably gained information that would have been of incalculable value to them had they effected a landing on Australian soil. Consequently, in protecting our pearl fisheries we are serving another very important purpose. I say, at once, that the Opposition will support any move that the Government may make in order to ensure that our pearl fisheries shall not be denuded. We owe that not only to the present generation but also to future generations of Australians; and, in addition, I believe that we have a moral obligation to the world to ensure that these fisheries shall be preserved - that the goose that lays the golden egg shall not be killed through the avarice or selfassertiveness of any nation or group of individuals.
Legislation of this kind opens up all sorts of interesting possibilities. The Opposition entertains views in relation to this matter which, I believe, it is not desirable to express in public. However, I have conveyed those views to the Minister for Trade and Customs (Senator O’Sullivan) and to the Attorney-General (Senator Spicer) ; they are well known to the Government, and I exercise some restraint in not enlarging upon them at the moment. We welcome the provision in the bill that seeks to extend the operation of this act to not only our own nationals but also the nationals of other countries who seek to engage in pearlfishing in what I shall call broadly Australian waters. Although the original act was passed in March, 1952, the bringing into operation of the whole licensing system and of the whole policing system depended upon the proclamation of particular waters as Australian waters ; and I understand that no proclamation of any such kind has been made since that act was passed. In other words, there has been complete absence of activity on the part of the Government to bring into operation the policing measures that were approved by the Parliament eighteen months ago. I understand that the proclamation relating to the sovereignty of the continental shelf has been made in the course of the last few days ; but as I understand the position - I am open to correction by the Minister - no positive step to enforce policing measures in respect of our pearl fisheries has yet been taken under the principal act.
– It. did not apply to foreigners.
– It did not expressly apply to them; but I say two things in that respect. First, that bill was debated in this chamber and the understanding was that it did apply as I have indicated. The activities of the J Japanese in our pearl fisheries were under discussion in the Parliament at the time.
– That matter was the subject of negotiations-.
– I think that it was in the mind of the Government that that measure was wide enough to apply to all persons actively engaged in our pearl fisheries. Secondly, I say that if the Government did not intend that the measure should apply to persons other than Australian nationals, over whom it has jurisdiction, then, unquestionably, it should have so provided. The Government is now seeking to rectify that position by applying this legislation not only to our own nationals but also to persons of any nation who may engage in fishing operations on our pearling grounds, lt is rather noteworthy that the United Nations, through its International Law Commission, has recently drawn up a code relating to fishing rights on the continental shelf. That code has not yet become law; but it is good to note that there is a tendency towards embodying this very vital aspect of international activity in a readily recognizable code form that will be known and understood.
I desire to comment on the drafting of proposed new sub-section (3) of section 5, which is dealt with in clause 3, and I shall do so more fully at the committee stage. Merely by way of giving advance notice to the Government on the point. I mention now that what disturbs my mind is the use of the words “ to a depth of not more than 100 fathoms “ in that proposed new sub-section. I take it that that provision refers to the continental shelf ; in other words, to the surface of the sea bed and the soil beneath it. I am afraid that as that proposed new sub-section is drafted, it may be construed to mean that that is a reference to the physical portion of the continental shelf, the land mass, to a depth or not more than 100 fathoms when the intention is to refer to the continental shelf that lies to a depth of not more than 100 fathoms beneath the surface of the water. 3 direct the attention of the Government to the use of the words “not more than 100 fathoms below the surface of the sea “ in paragraph (a) of proposed new sub-section (5) of section 5. It would seem to me to be safer to use those words in place of the words that have been used in proposed new sub-section (3) of that section. I mention that point now in order to - give to the Government’s advisers an opportunity to look into the matter before the bill reaches the committee stage.
The subject of the measure is one upon which I believe too much can be said. I do not propose to continue with my .remarks upon the bill except to add that the Opposition will support any measure that the Australian Government desires to take in order to assert and uphold our rights over pearl fisheries in Australian waters and to police them and maintain our laws. The Government may be assured of the full support of the Opposition in this matter and, accordingly, we support the bill and shall ensure that it shall have a speedy passage.
– I was pleased to hear the assurance given by the Leader of the Opposition (Senator McKenna) that the Opposition will not oppose this measure. In view of the fact that negotiations with the Japanese with respect to pearl fishing to the north of Australia have broken down, it is necessary for the Government to take decisive action to control pearl fishing in those waters. The Parliament has already passed two measures dealing with this subject, but the area of the continental shelf was not defined in either of them. The object of this measure is to define the continental shelf as extending to a depth of 100 fathoms.- The continental shelf was not mentioned in the previous bill. This action is being taken, I understand, because certain other nations have assumed control of waters up to a depth of 100 fathoms extending from their shores. In 1945, the President of the United States of America proclaimed certain areas 200 miles to the west of that country as waters belonging to the United States of America. The intention stated at that time was to explore the sea-bed for oil. The proclaimed area was approximately 750,000 square miles or 480,000,000 acres. The Australian continental shelf extends northwards 200 miles or more almost to Java and includes the Aroe Islands. To the north-west, it connects with Dutch New Guinea and Papua. All that area has a depth of less than 100 fathoms. Therefore this measure will bring under the control of the Commonwealth a large area of waters. It is necessary for the Commonwealth’ to control fishing for pearl shell in those waters. Between 1935 and 1940, the Japanese took 12,000 tons of pearl shell from the sea-bed off our northern coastline. As the “ take “ was approximately 2,500 tons a year, and the world demand was only about 3,500 tons a year, this flooding of the market by the Japanese caused a drop in the price of pearl shell from £200 a ton to £80 a ton and Australian pearlers had to seek financial assistance from the Commonwealth to enable them to carry on. In the years that I have, mentioned the combined “ take “ by Japanese and Australian pearlers was about 4,500 tons a year. The pearl-shell beds were seriously depleted and they took all the war years to recover. I believe this Government to be courageous in taking this step to control our pearl-shell beds so that -a similar depletion will not occur in the future.
The bill will not prohibit any nation from taking pearl shell from the Aus tralian continental shelf. It merely provides that any one who wishes to fish for pearl shell in the waters defined in the bill must have a licence from the proper authority. Such licences will specify the amount and size of pearl shell that may be recovered. The Commonwealth Government will thus be able to control pearl shell fishing in the water? to the north of Australia. Under clause 10 the Commonwealth may prohibit any one from fishing for pearl shell if it so desires. Therefore, I believe this bill to be an excellent measure.
Whilst I should prefer to see Australian pearlers recovering all the shell that is available in waters adjacent to this country, there are not enough Australian pearling luggers to cater for the world demand for shell. Therefore we must allow other nationals to come in to provide the shell that the world needs. It would he a dog-in-the-manger attitude if the Government were to say to other nations, “ Although we cannot fulfil the world’s demand, you are not to be allowed to recover pearl shell in waters adjacent to Australia “. The Government is not doing that. It will license pearling boats that wish to come into this area, and allow them to take certain quantities of shell.
The pearling industry in Australia has had a rather peculiar life. Pearling started in Australian waters in 1890, more than 60 years ago, and some firms have been operating for the whole of that period. They have had their ups and. downs. In 1938-39 the Australian pearling industry produced 2,600 tons of shell. When the Pacific war broke out in 1941, our pearling luggers were either destroyed or sent south. There were about 60 boats in operation at tha-t time. ‘ Some were sent to Fremantle, but. on the way down storms were encountered and many were wrecked. The result was that when the war ended the Western Australian pearling fleet consisted of only fifteen or sixteen vessels instead of 60 vessels. ‘ The fleets of the other States, engaged in this activity were similarly reduced. I believe therefore that the Government must give every possible encouragement to the pearl shell industry which is in a precarious position to-day due mainly to lack of finance. At Broome. neither the Commonwealth Bank nor any of the other trading banks so far as I am aware will advance money for the purchase of luggers. Consequently those who wish to engage in the industry must find their own finance. Most pearlers are finding it very difficult to build their fleets up even to the pre-war level. The Government should examine this matter to see what steps can be taken to help the industry to expand at least to its pre-war size and if possible beyond tha; size.
There was much talk throughout Australia when this Government decided to allow the Japanese to come back into the pearling industry. At that time I” informed the Senate and the Government, that the Japanese were peculiarly suited to pearling operations. 1 still hold that opinion. Japanese boats started operations in May of last year. Up to that time the greatest take by any individual lugger in the post-war years had been 22 tons. In three and a half months a Japanese manned lugger has fished more than 21 tons of pearl shell. As the season lasts for nine months, it should fish about 40 tons of pearl shell this year. There are approximately the same number of luggers operating from Broome this year as there were last year, but it is expected that this season’s “ take “ will be about 460 tons, compared with 290 tons last year. It . cannot be denied that the Japanese are playing an important part in the development of the pearl fishing industry. After negotiations between the Australian Government and the Japanese Government had broken down, the Japanese pearlers engaged in pearl fishing oft’ the Australian coast without permission. I support this bill because it provides that vessels may-fish in these areas only under licence, and the permitted areas will he clearly defined. If steps are taken to police the pearl-fishing areas the industry should be developed, on a satisfactory basis. I hope that this bill will be passed unanimously.
– This is a most, important bill in view of Australia’s entry into many spheres of international endeavour. I shall confine my remarks to one or two observations that I hope the Attorney-General (Senator Spicer) will place before the
Government. It cannot be denied that Australia dealt very fairly with Japan up to the time that the negotiations broke down, and we now have no alternative but to adopt the procedure outlined in the bill before the chamber. This is the second amending bill to be introduced since the principal legislation was enacted in 1952. In each instance the operative provisions are associated with the definition and redefinition of the term “Australian waters “. I use the term “ re-definition “ with great care, because of its vital importance. Although I support the bill enthusiastically, and commend the Government for its stand in this matter, I consider that the terms of the measure should be as strong as possible so that it will withstand any scrutiny in any jurisdiction. The geological concept of the continental shelf is a very old one, but it has assumed economic importance and significance in recent years. I understand that the juridical concept is of recent origin, and stems from the Presidential declaration of 1945 in relation to the continental shelf of the United States of America. The International Law Commission has reached certain conclusions.
Sitting suspended from 12.^5 to 2.15 p.m.
– I consider .that the position in international law in relation to the continental shelf is not as clear as the Attorney-General indicated in his second-reading speech. The position is extremely complex and fluid. As long as it is not completely settled and as long as there is even a diminishing area of legal controversy on the subject of the continental shelf, Australia must realize that it might be brought into an international controversy on this point. A very eminent authority, Professor Bustounante of Madrid, in a work which he submitted to the International Law Commission, propounded a theory which has relationship to our circumstances. He dealt with the subject of the contiguity of the continental shelf and he considered that mere contiguity was not sufficient ground for claiming sovereignty. He considered that there might have to be a prescriptive right for a period. Even that point would probably be controverted. But even assuming that it would be upheld in a court of international jurisdiction I think that we must take all the protection that we can in order to anticipate any decision in a future case in which we may be involved. The alternative to a case based on contiguity and legal prescription would be a complete assertion of sovereignty over the continental shelf. If we merely extend the region of our sovereignty without claiming that we have always asserted that sovereignty and still assert it we might have to fall back on legal prescription in order to buttress our right. We might experience difficulty in doing that. But if we assert that we do and always have exercised sovereignty then we will not be put to the necessity of establishing a prescriptive use over a period of time. That is why we should place ourselves in the strongest position to establish our right.
Prior to federation, the Federal Council of Australia passed legislation which entitled Australia to claim sovereignty over its continental shelf. Those who have read the bill before the Senate casually might consider it to be adequate in its present form. But when one examines the history of this matter one finds that it is a. history of extended jurisdiction. This bill seems to indicate the assumption of sovereignty in areas where we formerly did not exercise it. I understand that that is called an annexary assumption of sovereignty. I do not propose to be an authority on this subject but apparently there is an alternative method which is described ar “declaratory”. We often find the declaratory form used in ordinary legal matters in which it is asserted that some state of affairs exists and always did exist. I should be obliged if the Attorney-General would comment on this point later. I seriously recommend that the Government should consider whether the declaratory method of asserting sovereignty might not be adopted. I understand that when the United States of America declared its sovereignty over a certain area it did so in the declaratory form. On the other hand I understand that when the United Kingdom established its sovereignty in the Bahamas it adopted the annexary form. That form does not overcome the difficulties connected with prescriptive right. However. I have little doubt that this aspect of the problem has received the attention of the law officers of the Government. I do not know to what field of international jurisdiction a controversy over such a matter as this could be brought. As Japan is not a member of the United Nations organization it is possible that it might not have access to the jurisdiction of the International Court of Justice. Australia as a member of the United Nations organization, would have such access, but I would not venture an opinion as to whether we could bring J Japan before that body. Even if Australia could not engage in litigation in respect of its sovereignty over its continental shelf it is important that a principle should be established in relation to that matter because the Australian position might be used elsewhere in international legal conflicts, which could have great significance for Australia.
It seems that in future we shall continuously have problems such as this presented to us. Consequently I think that the capacity of the Attorney-General’s Department or the Department of External Affairs to deal with such matters should be strengthened. Nobody will deny the competency of the present legal staff who are well able to give ad hoc opinions and other advice to the Government. But this is not a firmly settled, field of law. It is still being determined by opinions of international commissions and courts. It is a field of law which requires special and continuous attention. The Government should consider the appointment of a man to advise it on such matters at the highest level. He could engage in continuous research into the field of law concerned and apprise himself of the mass of decisions and opinions that come. to hand every day so that the Government might be fortified with the best legal opinion on problems of this kind. I merely suggest, first, that, the statute and subsequent proclamation might be worded in a declaratory form, if that is considered desirable, and not in the present form; and, secondly, that we should fortify and strengthen, as far as we can, our legal advice in this field of law.
r2.26]. - I thank my friends of the Opposition for the reception that they have extended to this bill. I wish, particularly, to express my gratitude to the Leader of the Opposition (Senator McKenna) for what may properly be described as a very real sense of responsibility in approaching this important measure. I say that without any reservation, because this bill deals with matters that transcend party politics and which are concerned with our national interests.
I think it would be fair to the officers of my department to say that some of the criticism which the Leader of the Opposition made, based upon the fact that there have been three acts passed in relation to this measure, was perhaps not altogether fair, because he has not appreciated all the circumstances. The first measure that was passed was deliberately designed to enable us to bring into operation, with regard to pearl fisheries and other kinds of fisheries, a licensing system .which would be applicable to our citizens, as a prelude to negotiations with the Japanese. In other words, we armed ourselves with the possibility of introducing licensing which would be complementary, as far as our own citizens were concerned, to the kind of thing to which the Japanese might agree in negotiation. I direct the attention of the Leader of the Opposition to the fact that the position in regard to ordinary fisheries, on the international law basis, is nothing like as strong as it is in the ease of sedentary fisheries. To attempt to make our claim in regard to sedentary fisheries applicable to swimming fish would he much more difficult to sustain.
I now wish to refer to the comments of Senator Byrne in relation to the proclamation. There are two steps involved in this matter. Th.e proclamation referred to in the bill will be merely for the purpose of the Pearl Fisheries Act and the operation of a licensing system in relation to pearl fisheries; but that has been preceded by a proclamation, issued on Friday of last week, under which the Governor-General, acting on the advice of the Executive Council, declared that we have sovereign rights over the sea bed and subsoil in the area referred to.
– My suggestion was that the words “and always have had” should be added.
– I should think the claim that we have made is sufficient. It seems to me that the suggestion of the honorable senator is implicit in the words “ that we have “. That is the way in which the proclamation was framed by the legal officers, after considering all the circumstances. It is in line with the kind of proclamation that was issued in similar circumstances by the United States of America. It is a claim to sovereignty over the continental shelf. It is not simply concerned with sedentary fisheries, but is concerned also with sovereign rights over the seabed and subsoil of the continental shelf. The claim to sovereignty finds its basis in that proclamation.
– The question is whether that goes far enough.
– I suggest that a more effective claim than the one we have made could not be made. We do not say .that we intend to claim sovereignty from a certain date; we declare that we have sovereignty.
– But such a claim could be made, for instance, after the territory had been conquered by an aggressor.
– I can assure the honorable senator that all these aspects have received the most careful consideration by officers of my department, for whose knowledge of this subject I have the most profound respect. I am sure the honorable senator concurs in that view.
Perhaps the matter relative to’ clause 3 of the bill, to which the Leader of. the Opposition referred, might he dealt with at the committee stage.
.- The Leader of the Opposition (Senator McKenna) has indicated the attitude of the Opposition towards this measure generally. Therefore, it is only necessary for me to discuss the practical worth of the bill to the shell-fishing industry and to Australia. The coastline of Australia, which is adjacent’ to the shell-fishing waters, commences north of Cooktown, in Queensland, and proceeds north, and then west, and ends in the vicinity of Onslow, on the Western Australian coast. If we exclude the population of Darwin, which is approximately 7,500, on the whole of that coastline only a handful of people will be found. The entire extirpation of the shell-fishing industry would mean that there would be no population in the area at all.
I speak with some knowledge of the shell-fishing industry in Queensland. I have in mind, particularly, a certain town, in the north of Queensland, which is almost wholly dependent on the industry for its existence. If anything serious were to happen to the industry. I have no doubt that that town would revert to waste land and the majority of its inhabitants become dependents of either the Australian Government or the Queensland Government. It so happens that the majority of its inhabitants, who are actively engaged in the industry, are coloured. That is also true of the remainder of the coastline as far as Onslow.
From a defence point of view, it is essential for us to protect the shell-fishing industry as much as possible. Those who follow the industry must, of necessity, take fishing vessels out to sea, so that there is continual movement on the seas to the north of Australia. To my mind that is of considerable national importance at the present time. If the industry did not exist, it would be incumbent upon this Government, to have that area patrolled at Commonwealth expense. Tt may, therefore, be said that the very existence of the shell-fishing industry is saving the Commonwealth a huge sum of money because it affords a measure of security in our northern waters.
It is true that the industry is not of great monetary value to Australia. The shipments of trochus and pearl shell to America and other countries are not great when compared with shipments of other products. Nevertheless, they contribute something towards our national wealth. “We are expending approximately £200,000,000 per annum for defence purposes. I suggest that if an annual sum of,, say, £10,000 or £20,000 was spent to improve conditions in the shell-fishing industry, it would not be necessary for us to devote such large sums to defence.
It may be asked why this bill is necessary at all. In my opinion, the second reading speech of the Minister for Shipping and Transport (Senator McLeay) made that matter very clear. Our fishing beds require protection. We do not say that we are going to monopolize them and that we are to be the only ones to use them. What the bill really purports to do is to make the fishing beds available to all nationals, on our terms and conditions. When those conditions are examined, it will be found that they are not harsh and that it is not proposed to place any great restriction upon any one. As to whether those conditions can be enforced, I do not think it is necessary for me to comment, nor do I think it necessary for us to go too deeply intoquestions concerning the continental shelf and the sovereignty of Australia over it.
It seems to me that we have looked at this matter in a very sensible light.. We have# said, in effect, that the gaining of trochus and pearl shell in the waters to the north of Australia must be conducted in a sensible way. It is futile to take immature shell and so spoil the beds. We heard this morning a reference to what happened a few years ago when Japanese nationals recklessly exploited those beds, so that it took approximately ten or twelve years for them to produce again. If this bill effectively prevents that kind of thing from happening in the future, it will achieve something worthwhile.
We have reached a stage in our national life when we should be able to say that we control a certain area of the sea. Recent developments in the Northern Territory may perhaps enable us to have greater confidence when we are obliged to deal with subjects such as this in the future. Perhaps we will be able to police the territories concerned in a proper manner. I shall look forward with interest to the manner in which the Government will enforce the provisions of the measure.
– The position as I see it is much more serious from Australia’s point of view than it appears to be on the surface. Honorable senators should keep in mind the background .of this bill, particularly since the rearmament of Japan. We know that foreign capital has been invested in Japan and that it is dependent mainly upon war-time and luxury industries. Fishing for pearl shell is one of those luxury industries. The law in theory is one thing, but the law in practice is based generally upon the principle that might is right. We know from experience, particularly during the two world wars, that agreements have been ignored and that the law that might is right has been enforced with tragic results. I sound a note of warning because I was one of those who opposed uncompromisingly the rearmament of Japan. Upon the cessation of hostilities, it was stated, in effect, that in no circumstances whatever would Japan be rearmed, but, for reasons that I suspect but will not make public, there has been a volte face. Opinion subsequently was in favour of rearming Japan. Since then the Government has found it necessary to take the steps that are outlined in this bill.
We hope that that will be the end of the matter, but there has been heavy investment of foreign capital in Japan, and I believe that if it does not find an outlet in a war against Australia, it will do so ultimately in a war against some other country. Therefore, we should watch the position closely even though legal provisions may be made watertight on paper. If the Government proposed to exercise the law that might is right, that would be a bird of another feather. All the evidence goes to show that in this age, the principal industries upon which the economies of the nations depend are war-time and luxury industries. If they were abandoned, under existing conditions, a desperate situation including a possibility of war, would arise. I hope that the Government, with the support of the Opposition, will keep it in mind and do its best to preserve Australia’s interests in the circumstances.
– Although this measure has an important legal context from the point of view of international law, it-has an even more marked international political slant. Undoubtedly, the need for this measure arises from the signing of the Japanese peace treaty and the peculiar way in which the signing of the treaty was approached. I understand that the attempt to negotiate with the Japanese on the pearl-fishing industry was based upon a clause in the peace treaty. It was unfortunate that Australia was unable to do as the United States of America and Canada did and sign agreements with the Japanese before the treaty was signed, but the action that has been taken regarding the Japanese fishing in our waters was taken deliberately by the Government in the first place. Honorable senators are indebted to Senator Scott, who has intimate personal knowledge of the pearl fishing industry, for his contribution to the debate. He stated that operators employing Japanese pearl fishers were able to make more money than those who used other divers. That fact undoubtedly prompted Senator Scott when he assisted this Government to make its decision to import Japanese into Broome for the fishing industry several years ago. I appreciate the economic argument and the fact that that action has helped the port of Broome and the pearling industry. We should realize, however, that the international political situation also is very important. The international side of the matter might rest upon armaments, and the side with the greater number of guns would win out under international law. On the other hand. I do not know whether the economic side should blind us to the political side.
While the Japanese were negotiating with the Australian Government, they sent boats to fish in our waters. That was hardly the action of a friendly nation or a nation that has sworn to negotiate with its neighbours in the Pacific. I am not opposing the bill, but I hope that the measure is sufficiently strong to state clearly that we will not tolerate a situation where the Japanese can send their nationals into our waters not only to fish but for other purposes as well. I do not say this in an unkind spirit, but the fact is that the honorable member for Kalgoorlie (Mr. Johnson) recognized a Japanese private secretary as a man he had seen knocking around Derby, Broome and Onslow years before. I cannot believe that private secretaries are usually recruited from persons of that type. We must be vigilant. We have invited the Japanese back to places like Broome. Frequently in the past we have heard suggestions that the Australian people cannot do the things that are necessary for the economic and progressive development of Australia. Some persons have said that we cannot handle our finances and we have imported financiers. Others have said that we cannot do our own diving. When the whaling industry started, it was said that, nobody could use a harpoon like the Norwegians. I said at the time that I would like to see better riflemen than Australians, and now Australian harpooners ave more efficient than the Norwegians. We should not be gulled by the fact that Japanese can make a few more pounds in a year from pearl fishing than can half-caste aborigines or Thursday Islanders. In the final analysis, if it became necessary from the international political point of view, we could close the pearling industry. I am not advocating that but in a time of necessity, the major consideration should outweigh the minor. I support the bill. I regret’ that the position is such that such a debate should have had to take place, but as we have to negotiate with the Japanese and do what we can for peace and harmony, we do not want to get ourselves into a position where they will mistake kindness for weakness.
Question resolved in the affirmative.
Bill read a second time.
In committee:
Clauses 1 and 2 agreed to.
Clause 3 (Interpretation).
– I shall make a brief reference to paragraph (b) of clause 3 and to the first sub-section that is to be inserted by it. For the sake of simplicity I shall read only the relevant portion, which states - . a reference in this Act to the continental shelf is a reference to the sea-bed and subsoil of the submarine areas contiguous to the coasts of Australia . . . to a depth of not more than one hundred fathoms. [ draw the attention of the Minister to the fact that the provision that I have read is open to two possible interpretations. I have no doubt that it is intended to provide that the surface area of the continental shelf extending from the seashore beneath the water out to a depth of 100 fathoms is to be included in the ambit of this bill. I can understand why the words “ to a depth of not more than one hundred fathoms “ were adopted. The draftsman no doubt had referred to Article 1 of the International Law Commission’s draft on the continental shelf and related subjects, but in that draft the relevant words follow the word “ sea “. The introductory words of Article 1 read -
As used in these Articles, the term “ continental shelf” refers to the sea-bed and subsoil of the submarine areas contiguous to the coast, but outside the area of the territorial sea to a depth of two hundred metres.
In this clause, the committee is collsidering the submarine area. It can properly bt.- regarded as the surface of t!ic laud mass beneath the water, together with. all the subsoil of that surface. If we construe the submarine area in that sense as the land mass beneath the water, while I agree that the word “ fathoms “ is not applicable to a land mass, nevertheless, as a matter of grammar, I believe that the submarine area, looked at simpliciter envisages the land mass underneath the water in relation to that depth. Although I agree that the term “ fathom “ is not, in normal circumstances, applicable in measuring the depth of land, I claim that it may be argued’ that there may be some limitation of interest under this bill, in the continental shelf in respect of the depth of the land mass. The intention of the clause is that the- term “continental shelf” refers to the surface of the land mass from the coast right out to the point where the water reaches a depth of 100 fathoms; but I suggest that the clause does not say that specifically. I think that it could be improved from a drafting viewpoint. It is from that angle that I raised this question earlier, and I now refer to it briefly again.
.- The point which the Leader of the Opposition (Senator McKenna) has raised is one to which my advisers and I have given consideration during the suspension of the sitting, but none of us believes that it is necessary to make any alteration of the clause. We think that on its proper interpretation, what this means is that the continental shelf is described as being a reference to the sea-bed and subsoil of the submarine areas. Those are the areas under the sea contiguous to the coast of Australia to a depth of not more than 100 fathoms. In other words, the area comprised in this definition is that which is contiguous to the coast and extends to the point where it is under the water to a depth of 100 fathoms.
– The words “ at a depth “ instead of “ to a depth “ would make the meaning clearer.
– I disagree with the honorable senator because one has to get the conception of going out to that depth and of extending over the whole of the area. It is not merely at the depth, but the area which extends out to that depth. The alternative suggestion which I gather the Leader of the Opposition has made is that the words “to a depth of not more than 100 fathoms “ might be applicable to the sea-bed and subsoil; in other words, that it would extend only to that part of the sea-bed and subsoil which went to a depth of 100 fathoms. I offer two answers in relation to that. The first of them is that the word “ fathom “ is not applicable to the measurement of depth in relation to the solid mass as distinct from the water. Even if the interpretation which the Leader of the Opposition suggests as being possible were applied to this bill, it would not matter insofar as our claim to control pearl fisheries is concerned, because it is only in relation to pearl fisheries that this measure will operate. The definition in this measure is not the claim that we make to the continental shelf. That claim is set out in the proclamation to which I have referred, and, as all the pearl fish are to be found on the surface of this area under the sea, we do not need to go any further than the surface. I think that this clause has been properly drafted and expresses the intention of the section properly. Also, it has the merit of following the precise form which the International Law Commission has adopted. It is true that in the particular sentence to which the Leader of the Opposition has referred there is a reference to an outside area of the territorial sea to a depth of . 200 metres; but the point that the honorable senator makes is just as applicable to that article as it is to this provision - whether 200 metres is applicable to the sea-bed and subsoil or to the whole area. And, in both cases, I suggest it properly contacts itself to the sea area. Support for that view can be got by turning to proposed new sub-section (5.) of section 5, which reads -
If the Governor-General is of opinion that it is reasonable that the sea-bed and subsoil of a submarine area, being an area that -
is not more than one hundred fathoms below the surface of the sea; should be deemed to be part of the continental shelf, the Governor-General may, by Procla- mation, declare that that sea-bed and subsoil is part of the continental shelf . . .
I have no doubt that if the point that the honorable senator has referred to were ever raised as he has suggested, reference to that proposed new sub-section would strongly support the argument thatI have advanced.
– I thank the Attorney-General (Senator Spicer) for the explanation that he has just given. I accept as a fact that pearl fisheries are concerned with the surface of the submarine area. That being the case, why is there any need in this definitive section to refer to the subsoil at all? It refers to the continental shelf and to the sea-bed and subsoil. If the AttorneyGeneral’s statement that pearl fishing is concerned with the surface of the sea-bed is correct, there should be no reference to the subsoil. It may be that the reference in the bill to the subsoil creates my difficulty. I desire this legislation to be as nearly perfect as possible and to leave no room for argument in this matter. I suggest seriously that if pearl fisheries are not concerned with the subsoil, reference to the subsoil should be deleted from the clause. But, if there is any reason for retaining that reference, the Government should eliminate the possibility that in speaking of the depth we are speaking of the depth of the land mass and not of the sea. I suggest that all such doubt would be removed if before the words “to a depth of not more than 100 fathoms “ we inserted the words “ extending from the said coast “. The relevant provision would then read, “ - a reference in this act to the continental shelf is a reference to the sea-bedand subsoil of the submarine area contiguous to the coast of Australia . . . extending from the said coast to a depth of not more than 100 fathoms “. 1 think that’ that alteration would make the intention clearer. I am not being merely capricious in this matter; I desire to be helpful to the Government. If the Attorney-General rejects my suggestion, that is his responsibility. But I should like to feel that no room is being left for argument about the definition of the continental shelf from the Australian viewpoint, in respect of this- bill or at large.
– I support any action that the Government desires to take in order to establish sovereignty over the continental shelf. However, reference in this measure to the subsoil is entirely outside the scope of the bill. Recently, in the United States of America: various States wished to establish sovereignty over the continental shelf for the purpose of drilling for oil. Perhaps, the reference in this bill to the subsoil implies that we may need to. drill for oil in the Australian continental shelf. In any event, those two aspects should not be mixed up in a measure that deals specifically with pearl fisheries. Is there any reason why we should seek to hide our desire to establish sovereignty over the continental shelf? If we wish to establish such sovereignty, we should make our intention clear in the definition of the continental shelf in this bill. In the event of oil being discovered in parts of the continental shelf, it is important that we now make it clear that we are interested not only in pearl fisheries but also in establishing sovereignty over the continental shelf.
.- The Leader of the Opposition (Senator McKenna) referred to the fact that we had imported the words “ seabed and subsoil of the submarine areas “ into this clause. The reason why that has been done is that “Australian waters “ are defined in the preceding subclause as “ Australian waters beyond territorial limits “ ; that is, waters that are above the continental shelf. That reference to the continental shelf is picked up. as it were, and defined in the next sub-section, so that we then get a reference to the continental shelf as a whole which is a reference to the sea-bed and subsoil. In referring to the continental shelf we are referring to the sea-bed and subsoil of the submarine area. The purpose of this bill, it is true, is not to preserve our rights over minerals, or other deposits, which may be in the sea-bed and subsoil, but to preserve our rights in respect of sedentary fish which will be found on the surface of the continental shelf. My own view, as 1 have already said, is that the wording of the clause as drawn covers the position. I have no doubt whatever that if the court were called upon to interpret the words, “ to a depth of not more than 100 fathoms “, to which the Leader of the Opposition has referred it would interpret them as meaning the water above the submarine area to a point at which that water reached a depth of 100 fathoms.
– Where does the area commence ?
– It is the area contiguous to the coast to a certain depth, and that area is measured from the coast until the water reaches a certain depth, that is, the water above the submarine area to a depth of 100 fathoms. I think that that provides a commencing point.
– My difficulty in this matter probably lies in the use of the words, “ submarine areas “. If one accepts that concept of submarine area, it is the area beneath the water, including not only the surface, but also the subsoil. The clause having spoken of submarine areas, immediately proceeds with the words, “ to a depth of not more than 100 fathoms”.
– The honorable senator has apparently overlooked the words, “ contiguous to the coasts of Australia “ after the words, “ submarine areas “.
– Does “ contiguous “ necessarily mean immediately adjoining?
– I think it does.
– That might be open to argument. It is with the object of clearing that matter up that I have suggested the words, “extending from the said coast to a depth of not more than 100 fathoms “. If that were done it would be clear that when we speak of submarine areas contiguous to the coast, we mean all the sea-bed extending from the shore outwards to the point where the depth of the water reaches 100 fathoms.
– The use of the word, “ contiguous “ is in accordance with the use of the word in the International Law Commission’s report. That is one of the virtues of our definition of the continental shelf. It is quite clear, in my mind, that i he urea referred to as the area contiguous to the coast starts at the coast and proceeds out to the point where the depth of 100 fathoms is reached. I may say that this matter has received most careful consideration by the Parliamentary Draftsman and other law officers. Their view is that the clause is better left as it lias been drafted.
Senator MATTNER (South Australia) 3.14]. - I take it that the 100 fathoms is measured from the surface of the sea to the sea-bed and excludes the subsoil. I should like to know what depth of subsoil the provision envisages.
– As far as it goes. ‘
– Exactly. I merely wish to be clear that the 100 fathoms refers only to the depth of the water measured to the surface of the seabed, and that the subsoil underneath is also provided for in this measure. I take it there would be no possibility of an interpretation which would include the depth of the subsoil in the 100 fathoms.
– No.
Clause agreed to.
Clauses 4 to 6 agreed to.
Title agreed to.
Bill reported without amendment; report adopted.
Bill read a third time.
page 112
Debate resumed from the 16th September (ride page 93), 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 ended 30th June, 1954.
The Budget, 1953-54 - Papers presented by the Right Honorable Sir Arthur Fadden, M.P. on the occasion of the Budget of 1953-54.
– I address myself to this measure with a great deal of pleasure because, in spite of what honorable senators opposite have said,’ the budget is undoubtedly a good budget. That is not only my opinion or only that of members of the Government parties. As every honorable senator must be aware, the press has acclaimed the budget from one end of Australia to the other. Private individuals too have applauded it. I have spoken to quite a number of people since the budget was introduced and every one of them has said, “ It is a good budget. We are glad to have it. After all we have passed through, this budget is most welcome “. The only discordant note has been struck by honorable senators opposite. Surely that indicates’ quite clearly that they are the only ones out of step.
– There are only 28 people against the budget ! That is pretty good.
– And it is fairly right as the honorable senator well knows. Senator Armstrong said last night that the budget had missed the boat. Clearly it is not the budget but the Labour party in this chamber that has missed the boat. The Government has given relief on the widest possible scale at the earliest practicable moment. As the Attorney-General (Senator Spicer) said yesterday, this budget has been made possible only by the budgets that have preceded it. Only now is there evidence of some real progress in the production of essential basic material. Only now, because of that production, is the supply of consumer goods somewhere near the demand for those goods. Only now when the soundness of our economy has been established beyond all shadow of doubt, is a budget such as this possible. In this latter claim, again as the AttorneyGeneral has pointed out, we have the backing of the spokesman for the trade union movement at a recent ‘Commonwealth Arbitration Court hearing.
– He did not say anything about the budget at all.
– But he had a great deal to say about the economy of this country, and it is with the economy that I am dealing now.
– So did the manufacturers.
– Honorable senators opposite cannot laugh off the fact that the representative of the industrial movement has told the Commonwealth Arbitration Court that in his opinion the Australian economy is sound. We accept that opinion as evidence of the correctness of our assertions. I repeat that only honorable senators opposite and their colleagues in the House of Representatives are out of step with the rest of the community in their views about the budget. There are none so blind as those who will not see.
This Government has been courageous. During the past two or three years in particular it has done things that it knew would be unpopular in the electorate. Obviously no government and no political party likes to think that it is deliberately courting unpopularity. The Menzies Government knew full well that some of the things it had to do in the last few years would result in temporary unpopularity at least. Nevertheless, I am proud to ‘say that it has travelled straight down the middle of the road, and has not hesitated -to act as a responsible government should act. It has received no help from, the Labour party. The only suggestion that honorable senators opposite and their colleagues in another place have been able to make in the last few years is that Commonwealth prices control should be re-instituted. That has been advocated in season and out of season; but the belief that the exercise of prices control by the Commonwealth would solve our economic problems was exploded last night by the Attorney-General. I regret to say that the attitude of honorable senators opposite on financial matters is unworthy of Her Majesty’s Opposition in the Australian Parliament.
The fight against inflation which this Government, unaided by the Opposition, has unceasingly waged is now being won. That view, as I have said, is supported by the -trade union movement.
The last four quarterly adjustments of the basic wage in South Australia have resulted in a total increase of only 7s. a week compared with 40s. in the pre- ious year. Is any further proof needed that the fight against inflation is beingwon ? Surely, there is no better indicator of the progress of inflation than the quarterly adjustments of the basic wage. The fight against inflation is being won only because the Government addressed itself early in its period of office to the problem of increasing the production of essential commodities. Honorable senators know how often that aim has been stated in this chamber, and they know now how successful the Government has been in achieving it. Consider for instance the coal situation. It is not long since the approach of a collier to Port Adelaide was great news.
– The coal probably came from India.
– Some coal had to be obtained from India because the Government of which Senator Grant was a supporter was not able to obtain adequate supplies in this country. It is true that the States had to import coal, which the Commonwealth subsidized. However, the picture has altered completely and coal now arrives regularly at Port Adelaide in sufficient quantities to keep South Australian industries going. In the bad old days men frequently worked only short time, and production lagged in consequence. Fortunately, those days have passed, and there is now very little unemployment in Australia, a state of affairs which is attributable in a large measure to the policy that has been applied by this Government. Honorable senators opposite have always endeavoured to make political capital out of temporary recessions. I agree .with the Attorney-General that it is truly remarkable thai:, in view of the conditions through which we have passed, there has not been a severe recession in this country, and that there has been so little unemployment. Last week the Minister for Labour and National Service (Mr. Holt) was reported in the press to have stated that the number of recipients of unemployment relief is still steadily declining. At that time there were 22,000 persons in receipt of unemployment relief in this country. I am glad to he able to say that only 596 of that number were residents of South Australia. The number of recipients of unemployment relief in that State declined by 130 in August. The Minister also revealed that for the first time for many months past there are now more vacancies in industry than there are registered unemployed workers.
– The majority of vacancies are for skilled workers.
– I am sorry that the Leader of the Opposition (Senator McKenna) saw fit during his speech last night to refer to the great calamity that befell Davies Coop Proprietary Limited in South Australia. Although he may have a good knowledge of conditions in Tasmania and New South Wales, it is evident that he is sadly lacking in knowledge about the affairs of this South Australian company. The Minister for Supply (Mr. Beale) was reported in the press at the time to have said, in answer to statements that had been made by a spokesman for that company, that in 1950-51, on his instructions, his department had held a conference with large manufacturers of canvas and duck goods, in order to ascertain their ability to supply goods for defence purposes. Davies Coop Proprietary Limited was represented at that conference, and all of the firms which were interested, including that company, informed the Minister of the quantity of goods that they would be able to supply. According to the Minister, they all received orders to the limit of their capacity. Contracts were let overseas only after the capacity of Australian suppliers had been fully taxed. The Minister for Trade and. Customs (Senator O’sullivan) also has referred to Davies Coop Proprietary Limited. He positively denied that the condition of that company was due to the fact that the Government had granted licences for the importation of certain commodities from Japan and elsewhere. He also disclosed that prior to a complaint being made by that company he had referred this matter to the Tariff Board for inquiry. The Minister explained that although the Government’s policy of restricting imports was not primarily designed to provide protection to Australian industries, in effect, it did provide them with a measure of protection that they had never previously enjoyed. At the time that Davies Coop Proprietary Limited closed down a portion of its plant the secretary of the Victorian Chamber of Manufactures revealed that conditions in the textile industry were actually improving, and he denied the truth of assertions by a spokesman for the company. The only conclusion that I can reach is that that company, for reasons best known to itself, encountered difficulties which were not attributable to any action by this Government. I think that this explanation refutes completely the contention of the Leader of the Opposition that this Government was responsible for a temporary recession in the textile industry. Par from shutting down Australian industries, this Government has encouraged an increased production of basic commodities, which is the lifeblood of Australia. Their efforts in that connexion were very successful.
I shall now refer to primary production. There is no denying that the response by the primary producers to the Government’s call for increased production has been magnificent. Although I do not wish to weary honorable senators by citing statistics, I- should like to mention some figures that are tremendously interesting. The gross value of rural production increased during the last financial year by 17 per cent, compared with the previous financial year, to an amount of £1,090,000,000. If honorable senators opposite believe that that increase was attributable to the increased prices that were obtained overseas for our primary products,’ I remind them that in the same period the volume of rural production increased by 15 per cent. Although good seasons have contributed to increased primary production, there is no gainsaying the fact that the farmers also have responded to the call. I should like now to refer to the export value of our primary products. In the financial year 1952-53 the value of wool exported was £420,600,000, compared with £337,000,000 in 1951-52- an increase o’f £83,600,000. The value of our exports of butter during the last financial year was £20,200,000, compared with £4,900,000 in the previous year - ari increase of £15,300,000. South Australia is particularly interested in the production of barley. The value of barley exported in 1952-53 was £19,100,000, compared with £11,200,000 in the preceding year - an increase of nearly £8,000,000. The value of sugar exported in 1952-53 was £22,000,000, compared with £7,000,000 in the ‘previous year - an increase of £15,000,000, and the value of beef and veal exported in 1952-53 was £15,100,000, compared with £5,200,000 in the previous year.
– Can the honorable senator cite the relevant tonnages?
– I am not able to cite tonnage figures, but I point out that the overall’ volume of rural production increased by 15 per cent, in one year.
– Is the honorable senator satisfied with the increase of rural production ?
– What reasonable person would not be satisfied with it? I point out that if that rate of increase could be maintained for six years we would almost double our primary production. The value of lamb and mutton exported during 1952-53 was £S,SOO,000, compared with £2,000,000 in the preceding year. The second largest commodity export was wheat. The quantity of wheat - including the wheat content of flour - exported during 1952-53 was £89,700,000, compared with £S3,300.000 in the previous year. The export value of the commodities that I have mentioned in the last financial year was more than £627,000,000, compared with £471,600,000 in the previous year, which was an increase of nearly £356,000,000. These figures prove not only that our primary industries are in a very healthy condition, but also that the farmers have responded to this Government’s call for increased production.
The budget has been variously called the people’s budget, the little man’s budget, and the incentive budget. These titles are apt, because it cannot be denied that the budgetary proposals will reduce the cost of living in this country, and that the proposed taxation concessions will benefit ‘all sections of the community. Let us consider the position of a man with a wife and two dependent children, who is in receipt of an income of £500 a year. Under the new rates of taxation he will pay tax of £5 6s. a year, compared with £8 14s. in the last financial year. This is a decrease of £3 8s., or 39.1 per cent. The man on £600 a year will pay £13 ls. instead of £18 16s., a decrease of £5 15s. or 30.6 per cent. The man on £1,000 will pay £66 16s. instead of £83 4s., a reduction of £16 8s. ; the man on £1,250 will pay £115 4s. instead of £139 5s., a decrease of £24 ls.; the man on £2,000 will pay £321 19s. instead of £375 17s., a decrease of £53 18s.; the man on £5,000 will pay £1,709 19s. instead of £1,940 3s., a decrease of 11.9 per cent.;, the man on £10,000 will now pay £4,861 2s. instead of £5,450 ls., a decrease of 10.S per cent. ; the man on £15,000 will pay £8,291 instead of £9,196 3s., a decrease of 9.8 per cent.
Senator O’Byrne What about the person earning £30,000 ?
– He will not pay more than 14s. in the £1. Can any honorable senator contend that the reduction in these rates will not greatly benefit their recipients ?
– Let the honorable senator wait.
– I shall await with interest what the honorable senator has to say because he will have a difficult job to refute my contention.
Under the Government’s proposals in relation to sales tax the maximum rate of tax will become 16§ per cent, and a tremendous number of goods will be taxed at only 12-J per cent.
– Who introduced the higher rates of tax?
– The Government has modified a tax which a Labour government introduced originally. A great number of commodities, including most of those purchased by primary producers, will be exempt from sales tax under the Government’s proposals. Who can contend that the reductions of sales tax will not benefit everybody in the community? The reductions of sales tax proposed must benefit every one who goes into a shop to buy anything. As a result of the proposed reductions an Adelaide firm has reduced its price for footballs from 73s. 9d. to 69s. 3d.; golf balls Lave been reduced from 125s. 6d. to 1.19s. 3d. a dozen; baseball bats from 3Ss. 6d. to 35s. 6d. ; cricket bats from 135s. to £6 6s.; and tennis balls from 4s. 7d. to 4s. 4d.
– Can the honorable senator tell me the amount of the reduction on tobacco?
– I shall tell the honorable senator about jewellery. One jeweller iri Adelaide has stated that he will be able to sell for £68 10s. a diamond ring which was ordered three weeks ago at £87 10s. A watch which previously cost £20 will now be sold for £17 10s. A number of firms have made it known through the Adelaide press that they have employed special staff to write down the selling price of articles as a result of the reduction in the rate of sales tax..
Prior to the introduction of the budget every person who visited a theatre or other place of amusement had to pay entertainments tax. That tax has been abolished. It is the second tax that the Government has abolished in two years, the previous one being land tax. It is well to remember that the Labour party is pledged to the reintroduction of that tax and it seems as though the Premiers of the Labour States will reintroduce the entertainments tax. The deduction allowable from income in respect of education for the purposes of computing income tax has been raised to £75. Let us remember that the education allowance was introduced last year by this Government when the amount was fixed at £50.
– A good thing, too.
– It is a good thing. A man may now deduct £75 from his taxable income in respect of the education of each child and the allowance will cover a much wider range of expenditure than hitherto. Customs and excise charges have been reduced. It- has been stated that those reductions will not benefit many people. During a recent visit to the Murray River districts. I was reminded by growers of the great benefit that could accrue to them from the reduction of excise charges. The soldier settlers in the river areas will be glad to accept this proposal. The Government’s proposals in relation to the pay-roll tax will also benefit soldier settlers and other persons who employ more than one permanent employee because the pay-roll tax will cease to be applicable to pay-rolls totalling less than £4,160. This proposal will totally exempt from pay-roll tax all the people who are engaged in small private enterprises of their own. It has been estimated that of 90.000 people previously affected by this tax about 50,000 will now be exempt.
– Why not eliminate the tax ?
– The Government has made a great step towards that end. The Government has proposed valuable concessions in regard to estate duty which must benefit every person who exercises the very natural incentive to save during his lifetime and pass what he has saved on to his own kith and kin. No person who leaves less than £5,000 will be subject to estate duties.
A great deal has been said in another place regarding the alleged inadequacy of proposed pension increases of 2s. 6d. a week, but other ways in which pensioners have been assisted have been overlooked. It has been contended by Labour spokesmen that pensioners would have benefited had pension rises been tied to the cost of living adjustments of the basic wage. The new pension rate of £3 10s. will provide a pension of relatively higher value than that which was paid in 1949 when the Chifley Government was in office.
– Who told the honorable senator that?
– That is the statement of the Minister for Social Services (Mr. Townley).
– That is sure to be right!
– I shall prove that it is right. The “ C “ series price index number for the September quarter of 1949 was 1428. The maximum pension payable at that time was £2 2s. 6d. a week. As the “ C “ series price index number is now 2293, if the pension of £2 2s. 6d. had been increased in proportion to the rise in that number the pension would’ now be only £3 8s. 3d. a week. The Government has proposed that the pension should be £3 10s. a week. Consequently the pension will be ls. 9d. a week higher than it would have been if it had been increased on the basis that Labour spokesmen have suggested. I should like to hear any honorable senator refute that argument.
In this budget the Government has proposed very generous concessions to all sections of the community. It has been said by Labour spokesmen that this is a big business budget because some concessions for companies have been proposed. But the Government has only proposed to give a concession to a section of the community which, with every other section, has had a terrific burden placed upon it.
– By whom?
– I dealt with that subject at the beginning of my speech. The Government had promised that as soon as practicable this burden would be eased. The Government has now eased the burden on every other section of the community. Why should it not ease the burden on companies? It is the private firms throughout Australia which provide the greatest measure of employment. What could make the employment position more secure than a confident outlook on the part of those who conduct businesses? The relief in respect of company tax will be of direct benefit to persons who are on the pay-roll of business organizations. Surely it is just that the Government should try to give concessions to as many sections of the community as possible.
It is commonly thought that the Liberal and Australian Country parties are not interested in social services. Labour spokesmen in this Parliament and elsewhere are continually implying that the Australian Labour party is the only party which looks after the interests of the small man, and that only Labour governments have instituted the social services which we now enjoy. Nothing could be further from the truth. The present Government parties have shown in the past, and will continue to show, that they can be very generous when dealing with, pensions and social services. Indeed, they have provided social services benefits the like of which the country has never previously experienced. I refer particularly to the success ful health and medical benefits scheme. Because of adjustment of the means te3t in relation to pensioners, approximately 100,000 pensioners will now qualify for health and medical benefits, something which they never enjoyed when the Australian Labour party was in office. lt was the first Menzies Government, not a Labour government, which introduced child endowment for the first child. Honorable senators will recollect the opposition that that measure aroused in this chamber. The Australian people are beginning to appreciate that it is the Liberal party a.nd the Australian Country party which provide adequate social services.
Despite the concessions which the Government proposes, it expects to balance its ‘ budget this year. It proposes to provide approximately £200,000,000 for defence purposes, to increase payments to the States by £6,000,000, and to increase provision for social services by approximately £18,000,000. It is a magnificent budget, and I am glad to know that the people of Australia also think so. They agree that it is a good budget, and .so does the press of the country. I have not the slightest doubt that as we approach the general election next year, the public, which has seen fit to criticize this Government in some degree, will be with it entirely and that that support will result in the present Government parties being returned to office with a greater majority.
Senator CAMERON (Victoria) [3.59 1. - During Senator Pearson’s speech he stated that the Government had established a sound economy. That is perfectly true.- It is all sound and no substance, as far as the workers are concerned. During my remarks I shall endeavour to prove that neither the workers nor the pensioners will obtain any benefit from the budget. A budget as a financial statement for a fiscal period is one thing; Government policy is another. It is the implementing of policy that really counts. This budget is not intended to improve the conditions of living and employment of the workers. In spite of the promise of the Government, made long before the last general election, that it would increase the purchasing power of the £1. no attempt has been made to put value back into the £1. The reason why no attempt has been made is that, in order to do so, the Government would have displeased its wealthy supporters. Rather than make such an attempt, the Government has condoned almost unchecked inflation ever since it has been in office.
During this debate, reference has-been made to the basic wage, which was approximately £6 4s. a week in 1949 and is now £11 16s. Although there obviously has been an increase in terms of money, there has been no increase of purchasing power. If there had been, the money increases would not have been made. To the degree that the amount of money in circulation has been increased, the Government has allowed the currency to be inflated. Those who do not know any better - and it is to those people that this Government makes its appeal - naturally contend that if the basic wage was £4 6s. a week in 1949 and is £11 16s. a week in 1953, it must have increased. That is only half the truth. The increase has been in terms of money only, not in terms of purchasing power.
The judgment of the ‘Commonwealth Court of Conciliation and Arbitration, delivered on Saturday last, in the Wages and Standard Hours case, has been mentioned during this debate. Under that judgment, quarterly adjustments of the basic wage are to be discontinued, but unions will have the right to apply for variations. As was very appropriately stated by the Leader of the Opposition (Senator McKenna) earlier, that means that wages are to be pegged, but prices and profits may be increased to any degree possible. It is only necessary to refer to the financial statements that appear in the Australian press to see that record profits are being made. That means, in effect, that those profits are being made either by underpaying the workers on the job or overcharging the customers over the -counter. There is no other way to increase profits. To the degree that profits have been increased, the workers have been robbed - legally, of course. A report in a Melbourne newspaper to-day states that the profit of the Myer Emporium Limited for the last financial year was more than £600,000, which was a record. That business could have made its profit only in one or both of the ways I have mentioned. Similarly, it was announced to-day that the Common; wealth Bank made a profit of more than £10,000,000 during the last financial year. We know that banks are merely traders in credit. The Commonwealth Bank profit has been accumulated from the workers engaged in essential production and in the provision of essential services, because they carry the rest of the superstructure of society on their backs.
What will happen when wages are pegged ? I suggest that they will be automatically reduced in two ways. F i rst, they will be reduced by increasing prices and profits, and secondly, because workers will be replaced by increased machine power. We live in an age of greatly accelerating technical development, which means, in effect, that the real economic cost of production has never been lower, particularly in highly industrialized centres. But cost of production in terms of inflated currency has never been higher. Therefore, it is necessary to try to- reconcile what appear to be two irreconcilable propositions. The matter is easily understood, however, if one is sufficiently interested to study the economic factors.
Discontinuance of the quarterly adjustments of the basic wage will merely aggravate the position. The purchasing power of wages will continue to decline to the extent that prices and profits go up. The learned judges of the Commonwealth Arbitration Court have stated that unions may apply for. variations. In other words, unions must go to the expense of proving what should be perfectly obvious to the learned gentlemen. It has taken the court twelve months to decide to disallow the system of quarterly adjustments. Given two or three costing experts or economists who know their job, I think I could have acquired, in a much shorter space of time, the information which the court gained. In order to apply for variations, unions will be put to considerable expense. It has already cost them approximately £30,000 for representation in the Wages and Standard Hours case, which mean? that the purchasing power of their members has been reduced by that amount.
Wages are not based on the total values created by workers. -They never have been, nor is it intended that they should be. Wages are based on the cost of subsistence, and nothing else. All the wealth that is produced in excess of the cost of subsistence is appropriated in the form of rent, interest and profit charges. That is why, in every highly developed capitalist country in the world, there is ever-increasing poverty side by side with ever-increasing plenty. That is one of the reasons why the national income is so dangerously unbalanced and why an economic crisis may be precipitated any day of the week. Already, that is happening in America and has happened in Europe. In America, the position is becoming desperate, particularly since the cessation of- hostilities in Korea. The American press makes no secret of the fact. That is the position with which we are also faced in this country. There is no difference in kind, only a difference of degree. That is the position to which this Government has conveniently, for the time being, shut its eyes. It has depended on a lot of superficial political and press propaganda to indoctrinate the people with the idea that it has established a sound economy. That propaganda is all nonsense.
Another aspect should be taken into consideration. When the purchasing power of wages is reduced, it is necessary to reduce production because industry depends upon the workers as consumers as well as producers. If the process is carried far enough, ultimately there must be a time of crisis or adjustment. Then a depression occurs, as it did in 1930. Had it not been for World War II., that period of crisis would have had a more serious effect than it did. The Government is claiming credit for an increase of 2s. 6d. a week in pensions. The true basis of values is still gold, and in terms of commodities that gold can buy the increase of 2s. 6d. is actually worth about Sd. What can a pensioner buy for 8d.? Senator Armstrong has reminded honorable senators that tomatoes are 2s. 6d. a pound in Sydney, and chops are 5s. a pound. The increase will not buy anything worth having. The majority of pensioners are aged workers, men and women, who have worked all their lives for a subsistence wage. All the wealth that they have produced in excess of that wage has been appropriated by employers, financiers, and others. It has all flowed to that group which owns palatial offices and homes in the big cities. That is one of the reasons for the tragic slums that exist. They are the material results of life-long exploitation and impoverishment of the workers.
The aged workers are worn out and they are offered a pension barely sufficient to keep them alive. The payment of the pension is a virtual necessity because big business depends upon the purchasing power of the pensioners just as it depends upon the purchasing power of the workers. In a similar way, Ned Kelly returned the coach fare to each victim after a robbery. If the pensioners were treated justly, they would receive a pension equal to the basic wage. When the majority of the workers understand the economics of the situation, they will demand such a pension. The Government has been able to capitalize their ignorance because the workers do not. realize’ the extent to which they are imposed upon from the cradle to the grave. They will learn, however, and then the Government will be forced either to increase the pensions or give way to others who will do so. I have always told meetings of workers that all things yield to pressure, and that they will remain impoverished to the extent that they are prepared to accept poverty. I believe that the wages and salaries of men with small incomes should not be taxed. Some workers receive higher wages than others because they are more or less indispensable. They do not receive their extra money out of the goodness of heart of the employers. Wages and small salaries are taxed so that relief can be given to the wealthy taxpayers.
Indirect taxation also falls unfairly upon the workers and the pensioners. If there is a deficiency it should be made up from the bigger incomes. The Government took a step in the right direction when it abolished the entertainments tax. but it should not have abolished the land tax. It did so to help the wealthy at the expense of the poor. Sales tax does not matter to the wealthy person, but it affects the small wage-earners and the pensioners seriously. Because it is imposed on the .basis of a flat rate, the poorest people in the community pay the same rate of indirect taxation as do the wealthy. Honorable senators have referred to control of prices. It is not possible to abolish prices controls because if the Government, does not control prices, they will be controlled by private monopoly. Those who brew beer in Victoria have increased the price of beer without authority from those who buy it. Rental charges for houses 60 or 80 years old include capital charges that have never been incurred. That is why so many slums exist in our cities at present, and they will continue to exist so long as they are profitable to their owners, and so long as the community is prepared to tolerate them. The people are taxed indirectly through the medium of inflated rents and prices. Unfortunately, the majority of the workers do not comprehend that fact because our education system, makes no provision for teaching them anything that is really of value to them. That system merely teaches them how to be competent at their jobs, and so make profits for their employers. Outside their specialized knowledge, as in the trades and professions, the great majority of people politically are innocents abroad. That is why the workers make so many mistakes and are so easily imposed upon. The press now realizes that the workers are beginning to understand things better and, consequently, our newspapers are publishing more and more comic strips and glamorized features in order to divert the minds of the masses from the real issues that confront them. If the press were prepared to explain these issues, the workers would soon realize how they are fooled, ruled and robbed from the cradle to the grave.
The Government has announced that it proposes to ease the present restrictions on imports. It should not do so. As Senator Armstrong pointed out, this country was flooded with goods from Japan and other countries after import restrictions were eased in the ‘thirties, with the result that hundreds of thousands of workers were thrown on the dole. “We do not desire to see a repetition of those conditions. Industry in this country is capable of supplying most of the needs of this nation. I recall that before I was elected to the Senate, I joined other members of the Amalgamated Engineering Union in an endeavour to foster the manufacture of certain machinery which, up to that time, had been imported from Germany, Japan and other countries. We failed toachieve our purpose, with the result that machinery that had been manufactured’ by sweated labour overseas continued toflood Australia. However, when World War II. broke out, we were obliged toundertake the manufacture of machinery of all kinds. In 1939, the engineering, industry was 60 years behind the times. After war broke out, we had to build modern work-shops, manufacture the machinery that we required and train personnel to operate it, because the cheaplabour machinery which had been imported in previous years was completely out of date.
The Government’s announcement that it proposes to ease present import restrictions implies that it will implement a policy of closing down secondary industries and concentrating on primary production. In times of peace or war, no country can survive unless it has a balanced economy. To the degree that present import restrictions are eased,, the Government will throw our economy still further out of balance. Bearing that fact in mind, a deputation recently waited on the Minister for Trade and Customs (Senator O’sullivan), who replied that the Government would do everything that the deputation requested it to do ; but, intact, the Government has done nothingin that direction. Already our- industries are beginning to feel the effects of the Government’s new policy of easing import restrictions. The retention of such restrictions may induce big overseas firms to establish their industries in this country, and I should prefer that they did so rather than that we should continueto import our requirements.
The present shortage of housing is tragic. This is a vital problem. Overcrowding in our capital cities results in the breeding of criminals. This problem has already become pronounced in Melbourne and Sydney, but the Government is making no attempt to do anything to rectify the appalling deficiency in housing. In those circumstances, how can the Opposition be expected to support the budget when the Government shuts - its eyes to the economic forces by which the workers are impoverished? What I have said about housing can be said also about the production of foodstuffs. To-day, in the United States of America, over 170,000,000 lb. of butter is held in storage because the great majority of the American people cannot afford to purchase it at 6s. per lb. Those people are now purchasing margarine because it is cheaper than butter. I have no doubt that, as happened in the ‘thirties, the American Government will be obliged to destroy that butter. Indeed, the farmers in the United States of America have been enabled to carry on mainly because the Government of that country purchases the bulk of farm products, including butter, cotton, wheat and maize. Foodstuffs worth over 3,000,000,000 dollars are held in storage in the United States of America because no market can be found for such products. At the same time, nearly 3,000,000 Americans are practically on the bread-line. Unfortunately, a similar position appears to be developing in Australia. For instance, people who previously used to buy butter are now obliged to buy margarine because of the fraudulently inflated price of butter. Perhaps, when they cannot afford to buy margarine they will be told that they must be content with dripping.
The Minister for Labour and National Service (Mr. Holt) said that, at present, only 20,000 persons are unemployed in Australia; and one inferred from the manner in which he stated that fact that we should not worry about those persons who are unemployed. That figure would be doubled if -we took into account persons who are able to obtain only part-time employment. Apparently, the Government is content to allow that state of affairs to continue. I recall that at a conference of university professors held in Sydney last year it was calculated that about 3 per cent. of Australians were unemployed. One professor adopted the “what does it matter” attitude, but when, he was asked how he would like to be mie of the unemployed he replied he would not like it at all. In a balanced economy, not one man or woman who is willing to work should be out of work.
No reason at all exists for unemployment in this country at present when we bear in mind the acute shortage of housing and the shortages of many essential commodities. The Government expects too much of the Opposition if it expects my colleagues and me to accept this budget at its face value. The budget has been truly described as a rich man’s budget. We must recognize the principle in economics that quantitative differences bring about qualitative changes. For instance, quantitative differences in the matter of poverty brought about the revolution that occurred in recent years in China, just as the operation of the same principle caused the revolution that took place in England in the days of the Chartists. That is the explanation of the economic disturbances that are occurring in many other countries. However, no attempt is being made to solve this problem. Unfortunately, publications issued by the United Nations and by certain countries, particularly the United States of America, allege that such unrest is inspired by the Communists. In this comparatively young country with millions of acres unsettled, nothing is being done to enable thousands of ex-servicemen, qualified by experience, to go on the land. Instead, the Government has introduced this infamous, document, and apparently expects intelligent people like ourselves to swallow it.
Senator Pearson said that the production of basic commodities had increased, and he gave certain figures in support of his contention. His figures were correct; but what was the workers’ share of the increased value of production? It is quite true that wealthy farmers, bankers and so on, have received much more substantial profits, but the worker who has done so much to make those profits possible still receives only a subsistence wage. Senator Pearson also referred to child endowment. In that connexion too, the Menzies Government of 1939 merely made a virtue of a necessity. I was s member of this chamber at the time and I know, speaking from memory, that the late Judge Beeby informed the Government that unless child endowment was introduced, he would increase the basic wage. Child endowment was, of course, the cheapest proposition from the point of view of the then, government’s supporters. Obviously, a basic wage determined on the needs of a man, wife, and three children must be more than a basic wage fixed on the needs of a man, wife and one child. So, child endowment was introduced, and the basic wage remained unaltered. Thus, unmarried workers who gained nothing from the child endowment legislation were denied an increased basic wage.
I am not impressed by all this talk about the Government’s desire to do something for the poor and the needy. Throughout the centuries, governments of the political complexion of this administration have done no more than make virtues of necessities; and that is exactly what this Government is doing now. But it is optimistic indeed, if it believes that when the next election is due, and the working people are feeling the full effects of the increased prices that must flow from this budget, it will he returned to office. A famous philosopher said, in New York in 1919, in one of his brilliant essays -
There are times when we have to wait for the hard school of disillusionment to educate where reason has failed.
That is always the fate of the workers. They are invariably educated in the school of practical disillusionment, and when they become too disillusioned the supporters of honorable senators opposite run for cover. Between now and the next elections, as the effect of the implementing of this budget becomes evident, hundreds of thousands of workers will become even more disillusioned than they are to-day, and that disillusionment will be expressed very forcibly through the ballot-box. The result will be the election of a Labour government.
– We have been listening to a very sorrowful story about the budget, from honorable senators opposite: The buoyanttones in which they spoke before the recent Senate elections have gone. Apparently, Labour’s prospects at the next elections do not seem as rosy as they did. The contents of this budget have so depressed honorable senators opposite that they remind one of a motor car running on flat tyres. They have lost all their buoyancy. That is a clear indication of the real worth of this budget. To get a true picture of the budget, we have to go back three budgets in the life of thepresent Government. This Government has had to take strong measures to set theeconomy of Australia right, and undeniably our economic outlook has changed vastly for the better in the last three years. The people of Australia have had trials and tribulations. While Labour was in office the people of Sydney and Melbourne had to endure an existence which was hardly credible in this century of civilization. They did not know at what moment they would be deprived of electricity for power and light. Domestic and business life was completely disorganized.
– When was this?
– Honorable senators opposite could not see the light in the days to which I am referring, but I hope they will see the light on this budget. Oureconomic outlook to-day is such that the mournful attitude of honorable senators opposite is most surprising. Primary and secondary production has reached record levels. The people of Australia are enjoying the greatest prosperity ever experienced. The outlook is promising; yet the Labour party insists on painting a gloomy picture. That is being done, of course, solely for political gain. Honorable senators opposite hope to convince the people that we are on the verge of a depression. The Attorney-General (Senator Spicer), in his able speech yesterday,, showed how the Government had guided this country firmly and courageously away from dangers which might easily havecaused a depression. When the 1951-52’ budget was introduced I complimented the Treasurer (Sir Arthur Fadden) onhaving had the courage to put forward,. with the backing of Cabinet, a budget, which he and his colleagues knew mustmake this Government unpopular. That budget was prepared because the Government honestly believed that it was necessary. I had no hesitation in saying at that time that it would be to the advantage of Australia if we had more publicspirited men like Sir Arthur Fadden and’ his Cabinet colleagues.
– They wrecked the country.
– The yellow press of the State which Senator Grant represents in this chamber raised the greatest howl of all. Acting on behalf of Sydney pressure groups, the metropolitan newspapers sought to convince the people of Australia that this country was almost down. It was a disgraceful performance, particularly when, one considers the Government’s aim in introducing the 1951-52 budget. When a person is sick he usually has to take medicines he does not like. So it was’ with Australia’s economic sickness when this Government came to office. Honorable senators opposite know in their hearts that the economic situation to-day has been completely transformed by this Government’s administration. Under the 1951-52 budget certain measures were taken which gave this country a jolt. At that time we were still suffering from the aftermath of the war. There was still a large unsatisfied demand for materials, labour and consumer commodities. The flow of essential materials was so inadequate that no undertaking could be assured of steady progress. The purpose of the 1951-52 budget was to taper off the demand for materials so that only essential works would proceed. The result was that vital undertakings were able to go ahead with sr. even flow that had not been possible for many years. The building industry had been in a chaotic state. Construction work had proceeded intermittently with the result that costs were exceedingly high; but after effect had been given to the 1951-52 budget the position changed rapidly. Building costs, according to some authorities, dropped by about 10 per cent., and work proceeded smoothly. That was one of the purposes of the budget. Not only did the budget produce a more even flow of goods, but also it produced greater output which was, of course, a vital need. Absenteeism diminished considerably, and a real will to work became apparent. I say, therefore, that the tonic administered by the 1951-52 budget was of real worth and I am certain that as time goes by, we shall realize more and more the great work that budget accomplished in spite of the fact that it was described by squealers as a “ horror “ budget. I make no apologies whatever for that budget or for the support I gave to it.
Last year the Government was able to introduce what it termed an “ incentive “ budget. That, too, was a good budget, but il was torn to pieces by the Opposition. Its substantial concessions were so concealed by honorable senators opposite that one might have been pardoned for believing that there were no concessions at all. However, the Government steadfastly pursued the course upon which it had started and now it has presented to the Parliament a budget which contains the greatest concessions on record. Taxation concessions alone amount to £118,000,000 - - far in excess of what most people believed to be possible. In spite of what the Opposition may say, the budget gives relief to every person in the community. It meets the wishes of the people. Only a month or two ago, a gallup poll sought to ascertain what the people desired most in the budget. The result was that 50 per cent, of people wanted a reduction of income tax and 33 per cent, wanted a reduction of sales tax. The Government has therefore satisfied the desires of 83 per cent, of the people as expressed at that poll. It has reduced income tax by an average of 12-J per cent. Honorable senators opposite continually refer to the working man. As most people in this country are workers more or less, I assume that they mean employees. Some honorable senators opposite have stated that the employees will derive no benefit from the budgetary proposals. What utter nonsense! Even the Melbourne Argus, which does not usually support this Government, has stated that this is a small man’s budget, that it contains benefits for the small people of this country. One member of the Opposition has asked how the proposed concessions will benefit individual taxpayers. The proposed reduction of income tax, which is a tax on individuals, will cost the revenue about £64,500,000 a year. Everybody who pays tax will derive a benefit from those concessions. In addition, entertainments tax will be abolished, at a cost to revenue of about £7,000,000 a year. Surely nobody would suggest that only big business men go to picture shows and other places of entertainment. Sales tax concessions, from which everybody will benefit, will cost the revenue £11,700,000 a year. Therefore the proposed concessions will benefit all sections of the community. As I have said before, newspapers that are not always favorable to the antiLabour parties have indicated that they agree with this contention. The concessions that I have mentioned will benefit not only the wealthy sections of the people but all other taxpayers in this country. Pay-roll taxation will be eased, at a cost to revenue of £5,000,000 a year. The small businessmen will derive a greater benefit from this concession than will the big companies. In Queensland, which is primarily a rural State, many men on the land outside of Brisbane will derive great benefit from this concession.
Some honorable senators opposite have squealed about the proposal to reduce company taxation by £29,000,000 a year. They claim that this concession will benefit only the wealthy members of the community. It is utter nonsense for honorable senators opposite to suggest that public companies consist of only the wealthy members of the community.
– Who said that?
– It is a belief that has been developed by the Labour party, particularly during this debate. Everybody knows that shares in public companies may he purchased by any individual who has the money to pay for them. Shares in many companies are held in small parcels by ordinary men and women of this country, which is a very good thing. What is wrong with the Government making it worth while for companies to trade? If the ordinary people of this country had not invested a portion of their savings in public companies many workers would not now be in employment.
– And but for the workers investing their savings in that way, many companies would not be in existence
– Whenever there is a shortage of loan funds people look to the big companies to help them. Every Labour Premier in this country is constantly trying to attract overseas capital to develop industries in his State, yet when the Australian Government proposes to reduce company taxation honorable senators opposite complain. It is foolish for the Opposition to criticize this proposed concession and to claim that big business is being favoured. As I havesaid before, it would be a sorry position if the people of this country were not prepared to invest capital in public companies. It can be fairly claimed that companies are worthy of the proposed, taxation concession.
In addition to direct taxation cuts, the* budget makes provision for an increased allowance for a dependent wife and an increased education allowance. I am convinced that the comprehensive rangeof concessions that this budget provides will assist in the development of this country to a greater degree than ever before, because they will provide an incentive for people to work. This budget is the finest budget that has been, presented for many years. In addition to the numerous concessions to which I have referred, social services are to be provided at a record cost of £184,000,000,. which is an increase of £18,000,000 compared with the previous financial year.. In addition, provision has been made for financial assistance to the States to the record amount of £189,000,000, which is an increase of £6,000,000 on the provision that was made in the last financial’ year. Although the States are continually attacking the Commonwealth about thenshortage of funds, it is evident that they have received a wonderful deal from this Government. I am pleased that the Government has decided to discontinue reimbursing the States for the cost of administering prices control. This has been a wasteful expenditure. A most informative article published in the last issue of the Sunday Telegraph showed clearly that at times members of the staff of the New South Wales Prices Branch have’ been hard put to it to fill in their time.
I support this budget most sincerely, and I compliment the Government on its courage and generosity. The proposed’ concessions will confer benefits on every member of the, community. I am convinced that the people of Australia now realize that the stern measures that wereintroduced two or three years ago were necessary. By this time next year I hopethat there will be such abundant prosperity on all sides that the Government will be able to bring down another budget as satisfactory to the people as is the budget now under consideration.
– This debate has developed into an occasion for mutual admiration by supporters of the Government. I have never heard so many superlatives U3ed to describe something, that is completely dishonest and akin to a thimble-and-pea trick again* t the people of Australia. The Government has made only slight concessions, which have been grossly exaggerated, despite the fact that taxation is being levied at the highest rates that have ever been imposed on the people of this country, either in peace-time or in war-time. I am reminded of an unfortunate man in an institution who used to run for some distance and bash his head against a brick wall. When he was- asked why he acted in such a strange manner he replied, “ I like it when I stop “. That is exactly the position that the taxpayers of this country are in to-day. They have had to carry a terrific burden of taxation as a result of the bungling and maladministration of this Government, and they, like the man in the institution, will like it when it stops. This budget has been aptly described as a half-dollar budget, because of the miserable handout that is proposed to be made to the most needy sections of the community. Senator Wood said that the companies deserved taxation concessions as much as any other section of the community. I agree that all sections of the community should be looked after by the Government, but in this morning’s issue of the Sydney Morning Herald I found increases announced in the profits of such companies as L. J. Hooker Limited, Larke, Neave and Carter Limited, John McGrath Industries Limited,’ while Associated Securities Limited announced a 12-& per cent, dividend, Carroll Musgrave Theatres Limited a 10 per cent, dividend, and Davison Paints Limited a 10 per cent, dividend. These are the people who will receive the greatest concessions from the budget and they are already making handsome profits. The people who really deserve some concession are the less fortunate ones who have to pay high prices for the ordinary necessities of life.
– Has the honorable senator any objection to an increase in honorable senators’ salaries ?
– I should object if the salary of the Minister for National Development (Senator Spooner) was increased because he is grossly overpaid at present. The price of bread has risen to ls. a loaf, the price of milk has risen to 10½d. a pint, butter is 4s. ltd. per lb., and cheese, eggs and potatoes are over 100 per cent, higher in price than they were in 1949. Yet this Government has praised itself in a revolting way for the situation which now exists. The Government has nothing to be proud of. The inflation -which has continued in this country does it no credit, but reflects its ineptitude in government in all its forms.
The whole trouble at present is that Australia badly needs leadership and this Government is not giving leadership. This Government is a negative government. It is obsessed by the idea that it must” keep conditions as they are. That is one of the inherent weaknesses of the capitalist system to which this Government is wedded. Government supporters are here as representatives of the capitalist system and their objective is to maintain the status quo. If a war were to start to-morrow the Government would find unlimited credit in order to finance it. Australia is a federation and its finances are raised through federal taxation authorities whilst the States are struggling to hold their own. In every department they have pressing needs that they are unable to finance. The roads of Australia apart from the highways are a disgrace. Eight years after the end of the war a tremendous number of exservicemen and other people who did a magnificent job in the war effort are still unhoused. The acreage of our arable land is being reduced each year, whilst thousands of ex-servicemen are waiting to go on to the land.
– The honorable senator should tell that to Mr. Gair.
– That is the old parrot cry. This is a national responsibility. Government senators have their minds in blinkers. They cannot get outside of a certain narrow circle of thought.
This country needs leadership. It needs a big and a good man who realizes that Australia has a great destiny. Unless we enable people to go on the land and develop our primary and secondary industries, improve our roads and develop our natural resources, Australia cannot progress. There is not a scintilla of evidence that this budget will encourage those developments. Opposition senators have stated that this is not our responsibility. It is our responsibility in this Federal Parliament, where we have the authority to collect taxes.
This Government inherited a sound and stable economy which had passed successfully through a difficult war and post-war period. Honorable senators opposite appear to enjoy sitting back complacently and saying that this is a magnificent and wonderful budget. I think that this is a very poor budget because it makes no provision for that which Australia needs so badly. Australia needs men of imagination at its helm. There is no imagination in our present Government. Its members are all tarred with the one brush. They all consider that safety is more important than anything else. They believe in letting the economists dictate to them. They believe that we should revert to the good old days when a certain number of people were out of work and there was a certain tempo in development. They do not believe in introducing any new principle. They imagine that if a method is not old and tested it cannot be any good. That seems to be the psychology that dominates this Government. I am making these remarks in order to try to shake the Government out. of its complacency. Although Senator Wright is a man of ability I have not heard him make any constructive suggestions in criticism of the Government. He has enough ability to give the Government fresh ideas, but he is in leg-irons, too. I should like honorable senators opposite to break this traditional attitude towards the administration of the Commonwealth.
The Government has boasted that 70 per cent, of its supporters are exservicemen. During the general election campaign in 1949 the Government received tremendous support from ex- servicemen’s organizations, because it promised to pay ex-servicemen a just rate of pension. During the period- that this Government has been in power the basic rate of war pension has reached its lowest level. Under the Government’s proposals the basic war pension will be a lower proportion of the basic wage than it has ever been before. Yet the Government assured ex-servicemen that it would protect them. In 1931 the basic war pension was 64.7 per cent, of the basic wage. It remained at about 60 per cent, of the basic wage until the beginning of the last war. In 1940 it was 52 per cent, of the basic wage and it was still 52 per cent, in 1945. In 1949, after this Government had come to power, it was 44 per cent, of the basic wage; in 1950 it was 51 per cent.; in 1951 it was 39 per cent.; and in 1952 it was 35 per cent., which was the lowest that it had ever been. In this budget it is -proposed to make the basic pension 33.5 per cent, of the basic wage. I am quoting from the annual report of the Returned Sailors, Soldiers and Airmen’s Imperial League of Australia for 1952, which will be presented by the federal executive of that body next month. This sad state of affairs demonstrates that the elation of Government supporters over this budget is very hollow. In view of these important matters which the Government has overlooked, its reductions of pay-roll tax and company tax are not justified.
Another very important matter that has not been tackled in this budget is vital to the progress of this country. I refer to war service land settlement. As I said before, we are under the command of political pygmies. They will not view the situation in its widest aspect. They refuse to see that unless we are able to base our economy solidly on land development and a greater increase in population there is no future for this country. If the Government were to realize how land settlement will affect our future it would have no hesitation in calling a conference of all the States in order to tackle the problem of war sendee land settlement and land settlement generally. We are missing a great opportunity to place on the land suitable immigrants who, although they have agricultural training, are being allowed to take jobs in and around the cities. Their knowledge and training could be directed into much more useful channels.
A very important matter to which I wish to refer is the subject of home building. During the last year, private investment in house building fell by approximately £19,000,000. Although the States have made considerable efforts to -house the people, they are limited because of shortage of funds, and there is still a tremendous lag in housing. Unless we house not only Australians by birth, but also the immigrants who are coming to this country, we shall sow the. seeds of very grave unrest should an economic crisis develop.
Recently I returned from a visit to the United States of America, among other countries, and I was alarmed because of the position that exists in relation to the American economy. As far as the internal markets for many American commodities are concerned, saturation point has been reached. I was privileged to see something of the automobile industry in the city of Detroit. I saw there the line assembly process, by means of which a motor car comes off the line every 53 seconds. Each year 6,000,000 motor cars are produced in the United States of America. During the last week of my visit, 8,000 employees were dismissed from the automobile industry alone. Since the cessation of hostilities in Korea, there has also been a reduction in the number of people employed in the American steel industry. Generally speaking, America is on the verge of an economic recession. Fortunately, the same position does not face Australia. We have the opportunity to develop our natural resources and industries, provided that we are able to acquire a greater population. With approximately 9,000,000 people we have not the domestic markets to absorb all the products of our industries as they develop. From a defence point of view, we badly need more people in this country.
In my opinion, reduction of the intake of immigrants is most inadvisable. If we could maintain the rate of intake that operated during the first four or five years after World War II., I believe that it would be of great advantage to the country. That rate has been reduced, and all the plans that the previous Labour Government laid for increasing the population and our industrial growth have been slowed down. Australia has a great opportunity before it if we have the courage to grasp it. Courage will be needed. This Government must appreciate that investment in ourselves is the important thing. By means of Commonwealth loans, we must be able to finance land development and home building, and to undertake projects such as the standardization of our railway gauges and water conservation and hydro-electricity generation schemes. Projects of that kind need to be accelerated, but unfortunately this Government is neglecting them. Instead of complacently standing by and congratulating itself on making taxation concessions, I suggest that the Government should display some of the initiative and imagination which are necessary for our development.
I wish to refer now to the health and medical benefits scheme. The people who will be most beneficially affected by this budget are those in the higher income groups. Persons in receipt of social services benefits will receive only meagre assistance, and pensioners only 2s. 6d. a week. The provision that is being made in the States for- medical and hospital insurance places an added burden on the shoulders of the working man. Tasmania, which previously operated a very fine health scheme, under which firstclass health and medical services were made available to every one, has been prevented from continuing that seh em? by the policy of this Government. I am certain that when the time comes for judgment to be passed on the Government, the people of Tasmania will show their disapproval of that policy.
The great jubilation which the supporters of the Government in this Parliament have shown about the budget is not generally shared. The people have no need to be overjoyed because of the proposal to hand back a small portion of the earnings which have been extracted from them by this Government during the last two or three years. The horror budget imposed burdens on the people much more onerous than those imposed at any other time in our history. This meagre handout of 2s. 6d. a week to pensioners and the minute refund to basic wage earners and those on slightly higher salaries will afford cold comfort. Instead of the members of the Government showering praise and adulation upon each other,’ they should be applying themselves to the important problems which face Australia. Those problems include the development of the country and the need to increase the population by means of immigration. Unless the Government is prepared to discard the economic blinkers which it wears and face up to the challenge that is being made to Australia by other parts of the world, particularly the countries to the north, generations to come will brand this era of government as a negative one.
Whilst I concede that the tax remissions which, the Government proposes to make will be welcomed through the community, I am of the opinion that such remissions are overdue and much too small. Because of the increased cost of essential commodities, the pensions being paid at the present time are totally inadequate. The. proposed increase of 2s. 6d. a week will do little to meet the needs of a deserving section of the community.
– .Senator O’Byrne has accused the Government supporters of representing only capitalism and free enterprise. When we were elected to office, obviously we represented a majority of the people of Australia. Equally obviously, at that time a majority of people wanted free enterprise, not socialism. In that sense, I am not at all ashamed to say that I represent free enterprise. My colleagues and I were elected by the majority of Australians to fight for free enterprise and foithe welfare of the country. The honorable senator also accused the Government of not properly assisting the States. If honorable senators refer to the budget speech of the Treasurer (Sir Arthur Fadden), they will see under the heading “ Payments to the States “, that the total payments this year are estimated at £189,000,000. In order to obtain that sum, the people of Australia will have to be taxed, and this Government will be obliged to bear the opprobrium that always goes with any form of taxation. Tn return, the Premiers of at least five
States of the Commonwealth are complaining bitterly that the Australian Government will not give them sufficient money for education, housing and other needs. Senator O’Byrne referred to housing. He asked why the Australian Government did not do something about it. I remember that not long ago I had the unpleasant duty of speaking about the Zillmere housing estate in Queensland. I did not like doing” so. but I believed I should demonstrate to the people that it was not the fault of the Australian Government, but that the Queensland Government was squandering and wasting money that had been supplied to it for certain purposes. The result is well known. I suggest to Senator O’Byrne that when he wants to know about the housing question he should get busy with the States and not with the Australian Government. Senator O’Byrne suggested that this Government, had let down the ex-servicemen on the question of land settlement. In Queensland, my own State, the land settlement of ex-servicemen has been so badly handled for years by the Queensland Government that recently the Australian Government had to inform the Queensland Government that it would get no more money for that purpose unless it did what it was told. Now exservicemen in Queensland who want land have to take their chance in ballots with civilians. That has nothing to do with the Australian Government. It was the work of the Queensland Labour Government, which has done its best to embarrass and hinder this Government.
Senator O’Byrne referred to a 100 per cent, rate of pension. If his speech as reported in Hansard is read by persons who do not know the true position, they would not understand the meaning of a 100 per cent, pension. That term is not applicable to a totally and permanently incapacitated ex-serviceman. It has nothing to do with such cases. The vast majority of ex-servicemen who are on a 100 per cent, pension to-day are also on outside work. To many of them, it is merely an addition, either to the basic wage or to a good salary. I hope that my explanation will be seen by those who read Hansard so that they will understand the meaning of the term.
I shall direct my attention now to the budget itself. I notice that honorable senators on the Opposition side of the chamber who have spoken in this debate referred to practically everything but the actual figures that are contained in the budget. During the four years that I have been a member of the Senate, I have listened with much interest to some brilliant speeches from the Leader of the Opposition (Senator McKenna) and Senator Armstrong. Not all of their speeches have been on that level, but I have always looked forward to listening to them because usually they are interesting. On this occasion both the Leader of the Opposition and Senator Armstrong carefully avoided any of the specific issues associated with the budget. They mentioned none of the figures in it. Honorable senators were told by them again about the depression of 1931, the so-called horror budget and other things which have no bearing on the present budget that is under discussion. Throughout the speech of the Leader of the Opposition I waited hoping that he would mention something specific in the budget to which I could reply but he merely sought to destroy the renewed confidence that the people of Australia are showing. There are many indications of that returning confidence.
Sitting suspended from 5.45 to 8 p.m.
page 129
Debate resumed from the 12th March (vide page 924, Vol. No. 221), on motion by Senator Guy -
That a joint committee be appointed to consider and report upon the electoral laws of the Commonwealth.
That five members of the Senate be appointed to serve on such committee.
That a report on its deliberations be submitted by the committee to both Houses of the Parliament within four months after its appointment.
That,notwithstanding anything contained in the Standing Orders -
the committee have power to send for persons, papers and records, to adjourn from place to place, and to sit during any adjournment of the Parliament; and have leave to report from time to time the evidence taken;
the committee have leave to report from time to time its proceedings, and any member of the committee have power to add a protest or dissent to any report;
five members of the committee constitute a quorum of the committee;
the chairman of the committee have a deliberative vote and, in the event of an equality of voting, have a casting vote;
a message be sent to the House of Representatives requesting its concurrence and asking that six members of the House of Representatives be appointed to serve on such committee.
– Honorable senators will recall that Senator Guy placed his motion on the notice-paper many months ago. Shortly afterwards, I discussed the matter with him and also with the Minister for the Interior (Mr. Kent Hughes), who administers the Commonwealth electoral law. Subsequently, at my suggestion, Senator Guy also had a discussion with the Minister. Unfortunately, about that time, the Minister was stricken with illness and did not make a recovery until after the Parliament went into recess. Since the Parliament re-assembled last week, I have had a further conversation with the Minister on the subject, and I understand that Senator Guy also has had a further conversation with him. I suggest it would be appropriate to postpone further consideration of this matter until after we hear the outcome of those discussions. Accordingly, I move -
That the debate be now adjourned.
.- I rise simply to say that in view of the statement of the Minister for Trade and Customs (Senator O’Sullivan) and the assurances that have been given to me in respect of this matter, I have no objection to the debate being adjourned.
Question resolved in the affirmative.
page 129
Debate resumed.
– Yesterday, an honorable senator asked Mr. President whether the accommodation now provided for honorable senators in the House of Representatives could be increased. I am rather grateful that effect has not yet been given to that request, otherwise, perhaps, having regard to the fact that the Prime Minister is about to speak in another place, the attendance of honorable senators in this chamber at this juncture would be even poorer than it is.
Before the sitting was suspended, I expressed the opinion that members of the Opposition, for reasons best known to themselves, had refrained from dealing directly with the proposals contained in this budget, but had preferred to go over old ground and deal with events that occurred many years ago. The Leader of the Opposition (Senator McKenna) even went so far as to say that there was nothing in the budget that he would oppose.
– No, I did not say that.
– I understood the honorable senator to say that there was nothing in the budget to which exception could be taken. On this occasion, Senator Armstrong, to whose remarks I usually listen with interest, probably made the weakest speech that he has yet made in this chamber. He expressed the pious hope that Australia would go ahead. Yet, the party to which he belongs has done its utmost to make it most difficult for this Government, from the very day that it assumed office, to do its best for Australia. The first shot in that campaign against the Government was fired by Mr. Ferguson, who, at that time, was President of the Australian Labour party and is now associated with the dairying industry. When the result of the general election in December, 1949, was made known, that gentleman publicly called upon the trade unions to do everything in their power to make it impossible for the Menzies Government to govern. How can the honorable senator reconcile that statement with his plea that the Government should do its utmost to make Australia prosperous ? No doubt, the Opposition is disappointed with this budget, because it is a good budget. Otherwise, honorable senators opposite would deal directly with the proposals that it contains. Incidentally, members of the Australian Labour party may suffer still further disappointment when a certain event takes place in May, or June, of next year.
In the course of this debate, the Opposition, has resurrected its old story about the need for this Government to control prices on a nation-wide basis. They have raised that cry dozens of times since I was elected to the Senate. It appears to be the be all and end all of their aims. Let us examine the record of prices control as it has been, and still is, being administered by the States. It is nonsense to argue that one cannot appraise the value of prices control by the record of the States in that sphere in which they have operated since 1948. There is nothing to prevent the various State Ministers administering prices control from formulating a uniform policy in this respect. If they did so, I certainly could see no difference whatever between that method of control and any control that might be instituted by this Government. Unfortunately, owing to State jealousies, they have failed to evolve a uniform policy in this matter.
– Does the honorable senator think that the State Ministers should get together on prices control?
– Yes. So long as the States, which have sovereign power in this sphere, continue to administer prices control, they should endeavour to evolve a uniform policy. Prices control, as we have known it since the States resumed this power in 1948, has the disadvantage that State jealousies must inevitably creep into any discussions that are designed to bring about uniformity. For instance, at present, while potatoes grown in Queensland are available in Sydney, people in Queensland are unable to purchase potatoes because they are not. available in that State. One of the worst features of prices control, as it has been administered by the States, is that the prices of essential commodities only have been controlled whilst those -of luxury goods have not been controlled. As a result of this position, many employees transferred from essential industries to luxury industries because the latter are allowed to charge whatever prices they can get for their products and, consequently, can offer higher wages. Prices control has been abandoned in other countries because it has been found to be unworkable. Dealing with economic conditions in the United States of America, the annual report of the Commonwealth Bank for the financial year which has just closed states -
In the United States business activity has remained stable at high levels. Production and employment have continued to rise and expenditure on plant and equipment is expected to reach record levels in 1953. Prices have varied only slightly despite the relaxation or removal of controls over wages, prices and materials.
If a country, which has a population of over 175,000,000, is able to get along without prices control, I can see no reason why Australia, with its small population, cannot do likewise. In any event, we should be well advised at least to make that experiment. All of the evidence available with respect to the effectiveness of prices control shows that such control is not so important as members of the Australian Labour party would like us to believe.
Members of the Opposition stated that the Chifley Government reduced taxes in each of the four post-war years prior to the accession of the present Government to office. I agree with the truth of that bald statement, but I point out that the Chifley Government, in respect of the National Welfare Fund, issued treasurybills to an amount approximately equivalent to the amount by which it reduced taxes in each of those years. When this Government assumed office it’ found that the National Welfare Fund had been financed by that method to a total amount of £131,000,000. I recall that when that subject was debated on a previous occasion in this chamber, the Leader of the Opposition admitted the truth of what I am now saying when the fact’s were pointed out to him. Senator Armstrong complained bitterly that when he visited Korea recently he found that Australian troops there were being supplied with equipment and materials that were manufactured in the United Kingdom. Surely, there is nothing wrong about that. The United Kingdom is part and parcel of the British Commonwealth of Nations. The fact was that Australian industry was supplying all the orders that it was capable of supplying to meet the requirements of our troops in Korea, and that the United Kingdom manufacturers merely fulfilled orders which Australian industry was incapable of meeting. Almost in the next breath, Senator Armstrong complained about the easing of import restrictions. He cannot have it both ways. If he does not agree that the United Kingdom should supply goods which Australian industry cannot supply, let him say so. Indeed, I found it difficult to comprehend what the honorable senator was driving at. At the same time, he asked why the number of farms in Australia is decreasing. That is a simple question to answer. My reply to it is that Australians are getting a little tired of hard work. To-day, Australians are not willing to go out and do the work that the people of this country were willing to do when I was a youngster.
Dealing with the abolition of quarterly adjustments of the basic wage in accordance with cost of living fluctuations, one honorable senator opposite stated that that system was initiated in 1931 upon the application of the employers who desired to bring wages down. I believe that older -members of the Australian Labour party will agree that that statement is incorrect. That alteration was made in 1921, and the trade unions acquiesced in it because, at that time, the cost of living was rising. It will be recalled that Australia was then experiencing a boom following Work] War I. Consequently, the trade unions accepted the innovation of having adjustments of the basic wage made quarterly rather than annually as had previously been the practice
Some Opposition senators have spoken of this budget as a rich man’s budget, but they have offered no evidence to support that assertion. I have taken the trouble to examine some figures relating to income tax. Income-earners who receive up to £350 a year pay no tax at all. Between £350 a year and £500 a year, income tax ranges up to £5 6s. a year or 2s. a week. In the income range of £1 to £500 a year, there are no less than 1,000,000 taxpayers, or one-third of the total number of taxpayers. They pay, as- 1 have said, a maximum of 2s. a week in tax. I come now to the next category which is the income range from £501 to £1,000 a year. Honorable senators will agree that this range includes what may be regarded as average incomes. The commitments of taxpayers in this group vary from £6 to £67 a year. I am speaking now of the taxpayer who has a wife and two children. That is the average Australian family.
– Is the honorable senator speaking df taxable incomes?
– Yes. In the income range from £501 a year to £1,000 a year, there are 1,750,000 taxpayers, or 53 per cent, of the total number of taxpayers. Income tax levied on incomes between £1,001 a year and £1,500 a year ranges from £67 to £174 and taxpayers whose incomes are between £1,501 a year and £2,000 a year pay taxes ranging. from £174 to £321. In these two groups there are about 500,000 taxpayers, or 9 per cent, of the total number of taxpayers. They’ include such people as senior public servants, managers, and the owners of small businesses. There are only 161,000 taxpayers whose incomes are between £2,Q00 a year and £10,000 a year, and the tax paid by that group rises to 10s. in the £1 at £10,000 a year. They are such a small minority of the total number of taxpayers that they are virtually negligible. Let us consider again taxpayers whose earnings range from £501 to £1,000 a year, because that is the most interesting group. Take, for instance, the man on the maximum of that range, namely £1,000 a year. Today, £20 a week is not a high wage, especially for a man who works for himself. As I have said, 53 per cent, of the total number of taxpayers are in this income range. A man with a wife and two children pays £67 a year income tax on an income of £1,000. If his children are under sixteen years of age, he receives back £39 in child endowment, so that he contributes only £28, or 2.8 per cent., out of his income of £1,000 towards the cost of running this country. That does not suggest, surely, that this is a rich man’s budget. It is nonsense to speak of it as a rich man’s budget. A similar taxpayer who receives £1,500 a year - and many people to-day are getting that or more - contributes £135, or 13.5 per cent., of his income to the national pool after allowance has been made for the repayment of £39 in child endowment. I invite honorable senators opposite to look again at this alleged rich man’s budget. If they do, I am sure they will realize just how wrong their charge is.
I heard the Leader of the Opposition in the House of Representatives (Dr. Evatt) complaining bitterly that a company had made a profit of £4,000,000 last year. .Quite obviously he was referring to General Motors Holden’s Limited. Therefore, I have taken out some figures in connexion with the affairs of that company. It is easy to say that big companies are making huge profits, but only by examining the finances of individual companies can we get a proper picture. The gross turnover of General Motors Holden’s Limited during the last financial year was £49,600,000. Let me tell the Senate how that £49,600,000 was expended. Materials took 60.5 per cent., wages took 19.5 per cent., customs and excise duties 10.7 per cent., depreciation 1.4 per cent., preferential dividends one-tenth of 1 per cent, or approximately £48,000, and profits retained in the business 7.8 per cent. The one-tenth of 1 per cent, paid in preferential dividends, and the 7.8 per cent, profit retained in the business give a total net profit for the year of 7.9 per cent. Is there anything wrong with that? Surely any profit under 10 per cent, is a ‘fair return for the tremendous outlay in this industry. General Motors-Holden’s Limited have rendered a valuable service to the community by producing an Australian motor car. The company is a very good employer, as all South Australians will concede, and it has contributed much towards the industrial development of this country. It has risked its capital for a net profit of 7.9 per cent. Surely that is not excessive. I realize, of course, that some honorable senators opposite do not believe in profits at all, but I have never been able to see anything wrong with profits. Profits are an incentive, and we all have some such incentive.
Much has been said by Opposition speakers in general terms about pensions, but no specific arguments have been advanced. I shall direct attention, therefore, to what the Government has done during its ‘ term of office. It is quite obvious that in this budget year, with inflation levelling off, there is no need for the increases that were given on the last occasion. Nevertheless, the percentage is roughly the same. Under this Government, the general rate repatriation pension has increased from £2 15s. a week to £4 Os. 6d. a week. Totally and permanently incapacitated ex-servicemen receive £9 5s. a week now compared with £5 6s. a week three and a half years ago. That is an increase of 75 per cent. In addition, another 25s. or 30s. a week may be paid for assistance in looking after an incapacitated ex-serviceman. The age pension has risen from £2 2s. 6d. to £3 10s. a week, an increase of 65 per cent. In addition, under the administration of this Government, pensioners have become entitled to free medical treatment and free medicines. I do not think we have anything to be ashamed of in respect of repatriation benefits or pensions.
Senator Anderson compared the. number of war service homes built during the regime of the Chifley Government with the number built during this Government’s term of office. I shall go further back still. From the inception of the war service homes scheme in 1919 to 1949, a period of 30 years, a total of 54,000 homes were either built or bought. Since the Menzies Government was elected three and a half years ago, we have provided 4:9,000 war service homes. There is the comparison - 54,500 homes in 30 years and 49,000 in three and a half years. Yet honorable senators opposite have the cheek to tell us that we have done nothing for the ex-servicemen! A total of £28,000,000 was expended on war service homes last year, and a further £28,000,000 is provided in this budget. I do not know how the Opposition has the hide to criticize our record. The figures that I have cited are available for all to see.
Senator Armstrong said that under this Government’s administration the people of Australia had lost confidence in the loan market. I quite agree that there have been fluctuations of interest rates and that some hardships have resulted, but such hardships are associated with any kind of buying and selling of stocks and shares. The investor takes a chance. Very few people have suffered serious loss through lack of support of the loan market. People who can afford to hang on, and they are in the vast majority, will get their money back. There are, of course, some very unfortunate cases, as there are in every walk of life. Some such cases have been brought to our notice, but we have always found that the hardships suffered have been greatly magnified by the Opposition. Honorable senators opposite would have us believe that the majority of bondholders are suffering hardship whereas the truth is that such cases are only a very small minority.
Senator O’Byrne referred to the Australian Loan Council and claimed that the States had been denied adequate loan funds. I pointed out then that in addition to the £189,000,000 allocated by the Commonwealth to the States out of tax revenue, the States had also been given the entire loan field. Probably most honorable senators are familiar with statistics relating to the consumption of beer and spirits. The consumption of beer and spirits has increased by 65 per cent, per head of population, and bookmakers’ turnover has increased by 300 per cent. Totalizator dividends also have increased by 338 per cent., and the turnover of State lotteries has increased by 188 per cent. How can people be expected to save while this state of affairs continues to be fostered by State Labour governments ?
– The honorable senator should not become excited.
– I am not excited. I have raised my voice merely to emphasize this aspect of the matter. I understand that the Victorian Government proposes to establish a lottery in that State, although, according to the press, the Premier has an arrangement with the Legislative Council to reject the legislation.
– Thank God for the upper house !
– Yes, there are times when it is of advantage to have an upper house. I do not propose to weary the Senate by citing further figures, but I hope that honorable senators opposite will take to heart the figures that I have mentioned and that we will not hear from them any more nonsense about this budget being a rich man’s budget. The Treasurer at the conclusion of his budget speech, said -
It is a matter of great pride for me to lay before the House to-night these fulfilments of our undertaking. I do so with a profound faith that, given the co-operation of the community, they will yield rich fruits for Australia and its people.
Surely the Opposition, which represents the people of this country and is, indeed, part and parcel of the community, should support anything good that is introduced by the Government, irrespective of the political, colour of the Government in office. It should not oppose merely for the sake of opposing. Yet, in the four years that I have been a member of this chamber, honorable senators opposite have opposed everything that has been introduced by this Government, with the exception of machinery bills and bills of an international character, such as the Pearl Fisheries Bill. I emphasize that neither L nor any other supporter of the Government is on the defensive. This is a good budget, and I am convinced that we shall produce even a better budget next year.
– This is the eleventh budget that it has been my privilege to hear introduced into the Parliament, and of them all, this budget has caused me the greatest disappointment. Never before have I heard a budget ushered in with so much publicity and speculation, and. accompanied by so much advertisement. Although we were given to understand that it would ameliorate the lot of the Australian people, upon analysis we find that we are in for a very deep and bitter disappointment. I should not have spoken this evening but for the remarks that were addressed to me this morning during question time by the Minister for National Development (Senator Spooner), who represents the Minister for Social Services (Mr. Townley) in this chamber. The Minister said that my sympathy for the civilian widows was irresponsible, and that the previous Labour Government had done nothing to ameliorate their conditions. That is, of course, profoundly untrue. At a time when the previous Labour Government was devoting almost the whole of its ener gies to carrying out a total war effort, it placed on the statute-hook of this country the first legislation to provide for civilian widows. I have said many times since I delivered my first speech in this chamber ten years ago that that legislation did not go far enough. Neither the Government that was then in office nor any government since has given adequate attention to the needs of the war widows and civilian widows in the community. I maintain that a woman who, alone and unaided, is bringing up a family is doing a job of vital national importance and should be recompensed accordingly. Yet the Treasurer (Sir Arthur Fadden), after dealing with proposed expenditure in excess of £1,000,000,000, has seen fit to say that the Government proposes to increase widows’ pensions by only 2s. 6d. a week. That was a greater insult than if he had proposed to give them no increase. I cannot understand any Minister of the Crown having the effrontery to so insult our ex-service men and women and the pioneers of this country by offering them a pittance which will not buy even half a dozen eggs. The position of the pensioners in the community is becoming one of exceedingly great public interest. The time has long passed when every pensioner was regarded as being a ne’er-do-well and that a person who was obliged to seek a pension had only himself to blame because he had frittered away his money during his youth. In the past the fathers and mothers of large families could not save because they needed every penny that’ they could earn in order to educate their children and bring them up decently. It. is a very disquieting thought that in this year of grace we have so many thousands of people in the community who are not wanted, and to whom the Government gives a pittance which is not sufficient to maintain them in a reasonable state of comfort and so hastens the day of their death.
I direct the attention of the Senate, and particularly of the Minister for National Development, to three articles that were published in the Perth Daily News on ‘the 19th, 20th and 21st August. They were written by a young reporter who, having heard that there were thousands of people starving in Perth, and thinking that the reports had been exaggerated, set out to prove or disprove them. His articles show that the reports were true. There has been a great deal of public indignation about this matter in Perth, and the Junior Chamber of Commerce has expressed its amazement that so much poverty and misery exists in a community that had hitherto been the envy of the rest of Australia and of other countries. Now the Government proposes to raise pensions from £3 7s. 6d. to £3 10s. a week. This works out at 1-Jd. a meal, on the basis of three meals a day. But apparently the aged are not supposed to want three meals a day, because the pension is intended to provide them also with shelter and clothing. The old people’s homes in the community are so inadequate that in Western Australia there are many hundreds of people waiting admission to them. Only quite recently men have committed suicide in the Swan River rather than spend another winter sheltering on the Esplanade because they are unable to make ends meet. It is the plain duty of the Australian Government, as the central government of this country, to see that people who have borne their share of the heat and turmoil of other days are given an adequate living allowance. Senator Kendall has referred to bookmakers’ turnover and totalisator dividends. I am sure that he will agree with me that it would have done the Government much more credit if it had retained the entertainment tax and the higher rates of duty on whisky, and devoted the yield of £7,000,000 or £5,000,000 to the welfare of the aged, infirm, and war crippled members of the community. I believe that many other supporters of the Government, also, would agree with this point of view, because, despite the high prices of admission to places of entertainment it is only on rare occasions that such places do not receive their full quota of patrons. Whether or not the price of admission to theatres and race-courses is increased or decreased by 3d. or so, people who normally frequent such places will continue to do so. However, I do not subscribe to the doctrine that people should participate in such forms of entertainment at the expense of the unfortunate members of the com munity. It does not matter to the average housewife whether or not the price of admission to places of entertainment is reduced, or whether or not the price of whisky is reduced by 21s. a gallon, but it matters greatly to the pensioners that this Government has deprived itself of revenue which would have enabled it to increase pensions and allowances to those in need of them. I fail to see how the Government can justify its action in this connexion.
In days gone by it was my lot to deal with the delinquent children. I found in many instances that it was not a matter of the children being delinquent, but that society, through its dereliction of duty towards them, had forced their widowed mothers to go to work, frequently in menial jobs, in order to keep themselves and their children. The Labour Government of 1942 introduced legislation to provide for widows’ pensions on a very small scale. I should like to see this Government, or the Government that will succeed it next year, go one step further and do for civilian widows what has been done quite rightly for war widows. There should be given to civilian widows with dependent children a domestic allowance as well as their ordinary pension, because they have to keep and educate their children, and see that they are given a fair deal in life. How can they do that on a pension of £3 10s. a week, plus endowment of 5s. for the first child and 10s. a week for subsequent children? Child endowment is paid to rich and poor alike, whether their income be £3 or £103 a week. I point out that the amelioration of the sales tax will benefit the people of all incomes alike. Last week-end I visited a home where the children- were quite astonished to see butter on the table. One child said to me, “ We are glad that you have come to see us, because this is the first time that we have had butter on the table for a long while “. I asked, “ What do you use instead of butter ? and the child replied “ Margarine “. That made me very sad. I could not eat the butter, because it would probably have turned to gall in my mouth, realizing that I was taking it from the children. Although the Government subsidizes butter, how can widows on a pension of only £3 10s. a week afford to buy it at 4s. 2d. per lb. ?
Even at this late hour, I urge the Government to do something for the members of the community who are on the lowest rung cf the social ladder, and if necessary to re-impose the entertainments tax, or cut proposed expenditure so that adequate increases can be given to service pensioners and others. Senator Kendall cited specific figures in relation to social services. In August, 1949, the last year of office of the Chifley Government, the pensions were 39 per cent, of the basic wage. They are now 29 per cent, of the basic wage. The actual value of the pensions in terms of goods and services has declined by at least 10 per cent, if we accept the basic wage as a yardstick. When the Chifley Government went out of office the basic wage was £6 9s. a week; it is now £11 16s. a week. Senator Kendall said that pensions had been raised by 75 per cent., but he forgot to tell us that during the same period the basic wage rose by 83 per cent.
A Minister has stated in another place that some pensioners would receive an additional 12s. 6d. a week under the Government’s proposals because they would be permitted to earn more. I wonder if the Minister is aware that 85 per cent, of pensioners are unable to earn anything at all and have no other income. This budget has done nothing for the pensioner except to give him half a crown rise which is not very adequate. It may provide him with an extra meal a week. Perhaps we must be thankful for small mercies. But the Government will be judged, not on its proposal to reduce the excise on whisky by 21s. a gallon, but on the insult that it ‘has offered to war pensioners and other pensioners. I hope that even at this late hour the Treasurer will see the error of his ways. A number of other social services have not been improved at all by the Government. Unemployment and sickness benefits remain the same, although the cost of living has risen; they no longer have the value that they had when they were introduced. I am pleased that the Treasurer has proposed that the allowable deduction from taxable income on account of medical expenses shall be increased to £150, but that will not be of much assistance despite the fact that people are contri- buting to various hospital and medical schemes. Contributions to these schemes constitute another tax on the worker who wishes to obtain the benefits from the Government. A married man has to pay 3s. 6d. a week to a hospital fund in order to receive the additional hospital benefit. The Government has not mentioned that these contributions represent a tax levied on people by the Government and collected by a body which is not responsible to the Parliament for the way in which it disburses its funds. There has been an outcry in Western Australia recently because many people have contributed to a hospital benefit fund, the members of which the Government will not accept as eligible for its medical benefits. These people have now had to join other societies and have had to pay twice for the one benefit.
I should like the Government to give publicity to the fact that those on” age, invalid and war pensions are eligible to receive certain medical or hospital benefits without having to pay into these societies. The societies are out to make a profit if they can and they do not tell the pensioners that there is no necessity for them, to .belong to a society in order to receive the government benefit. Quite recently, a woman age pensioner and her husband told me that they had not known that they were entitled to certain medical benefits under the pensions legislation. They had been paying into a hospital benefits fund for some time. Then they discovered that they did not need to contribute to the fund unless they intended to go into a private hospital. The costs in private hospitals are prohibitive. On approaching the society, they had been informed that it could not refund their money. They were told that the amount was only £6 and that it would keep them, financial up to 1958. The woman said that they might not live that long. The person behind the counter informed her that in that case she would not need hospital benefits. I contacted the secretary .of the society and told him that although the amount involved was not very much to his society, it represented the price of an overcoat to a woman on the pension. It could make all the difference between comfort and the cold of winter to her. As the couple could not possibly afford the additional charge which would have to be paid in a private hospital they had paid their money into the fund for nothing. I should like publicity to be given to the fact that an age pensioner who is likely to need treatment in a public hospital in Western Australia does not need to belong to a hospital benefits fund. Although 3s. 6d. a week may not seem much to honorable senators, it is a great deal to those who have to live on £3 10s. a week.
I feel that the Government has been remiss in giving only half a crown to ex-service pensioners, war widows and other pensioners. It is fantastic that, in a budget totalling £1,000,000,000 the Government should have the temerity to offer pensioners only 2s. 6d. a week increase. I am sure that when Senator Pearson said that he has heard nobody but Opposition senators express dissatisfaction with the budget, he had his tongue in his cheek. Otherwise he must have been asleep for a long time like Rip Yan Winkle. Although the budget confers benefits on a section of the community it has raised a storm of protest from ex-servicemen’s associations and pensioners’ associations whose members have been so shabbily treated.
– -I said that there had been no criticism of the budget in the press.
– I am afraid that the honorable senator does not read his newspapers intelligently. If he had read the account of the Returned Soldiers, Sailors and Airmen’s Imperial League of Australia conference in Melbourne last week he could not, by any stretch of his imagination, have translated the motions moved at that conference into evidence of approbation of the work of the Treasurer.
Senator Kendall made rather a peculiar statement regarding the rates of taxation of various groups of workers within certain income ranges. He said that there are a million workers who do not really count because they are receiving less than £500 a year. Does Senator Kendall realize that £500 a year is less than the basic wage and that if 1,000,000 workers in this country are being taxed on less than £500 a year then 1,000,000 workers are living under sub-standard conditions? But they are not the ones that he is concerned about. He is concerned about the income group between £500 and £1,000. He said that this is the most interesting group. I think that it would be more interesting to know how 1,000,000 wageearners and their wives and families exist under sub-standard conditions. This budget leaves a great deal to be desired by a number of people. Sales tax has been reduced on quite a number of items. It has been reduced on furs and jewellery and other items of which the housewife can only read in the magazines or newspapers. Most of the items on which sales tax has been reduced are those which the average housewife who is trying to make ends meet on ordinary wages is not able to buy. The commodities that she needs most, still have to be bought at prices higher than those which obtained under the Chifley Government. I should like to see every housewife with furs or jewellery, but housewives cannot afford them because all their wages are spent in buying food and clothing for their children. Meat prices are fantastic. It costs 16s. 6d. to have children’s shoes half-soled. That was the price of a new pair before the war. These are items of expenditure of which the housewife is more conscious than of furs and jewellery. The claims made by the Government in regard to its reduction of sales tax are deliberately misleading.
– There is no sales tax on meat or shoes.
– But the fact that the housewife has to pay these prices leaves her with no money to spend on the luxuries on which sales tax has been reduced. The Government could well have made greater reductions of sales tax on items which have to go into the home such as furnishings and linoleum. We are grateful for the reductions which have been made on sales tax, but we do not consider that they are extensive enough.
I was pleased to hear that the allowable deduction from taxable income for education expenses was to be increased to £75. That is good. But how many people will it affect? Very few people in the lower income groups will benefit from this concession. Such people cannot afford to give their children college educations except at some denominational schools. What happened immediately this increase was announced last week? Many schools decided to increase their fees by £2 2s. a term. That will take away immediately any benefits that this budget might confer. Contrary to popular belief, the Government is not proposing to give parents £75 to help pay for the school fees of their children. It is merely giving them an allowable tax deduction of up to £75 in respect of expenses incurred in sending their children to school. Those people whose children are at private schools, or those who are paying fares, will receive the benefit, which is little enough compared with the increased charges made by schools, some of which were announced after the budget was only a week old. The same thing happened when the hospital benefits scheme was introduced. It was amazing how, overnight, the private hospitals raised their fees by exactly the amount of the Commonwealth benefit. Such a thing does not make -sense. If the Government provides a ^benefit, it should make certain that that benefit really finds itself into the pockets of those for whom it is intended and is not taken away before the recipients get it.
As we go through the budget, some vast proposed expenditures are to be seen. For instance, a great deal of money is to be expended by the Department of External Affairs. Nobody will grumble about that if we obtain value for such expenditure, because we all know that no nation can live to itself alone, particularly in these modern days. Australia, which was once such an isolated unit out here in the southern ocean, has now, because of the improvements or otherwise of science, become a basic part of the world. It is most important, therefore, that our relations with other countries should be kept on as high a diplomatic plane as possible. We do not want anything niggardly to be done in that connexion. But I wonder whether we will receive full value for some of this expenditure. For instance, the Government proposes to expend £252,000 on our establishment at Washington. I hope that when the time comes to discuss the Estimates in detail, we shall have a little more enlightenment on such matters than is contained in the bare statements and figures in the budget papers which have been presented to us. Honorable senators will see that it is proposed to expend £95,000 this year in Russia. For what ? Will we receive anything like £95,000 worth of reciprocity? What is the real set-up in connexion with that establishment? In Japan, it is proposed to expend £88,000. Again, what will Australia receive in return for that expenditure?
It lias become the fashion to speak in round figures, in hundreds and thousands, and millions of pounds. The attitude seems to be that another £1,000,000 down the drain here and there does not matter. It is only when the Government gets back to the ordinary everyday affairs of life that it thinks in terms of halfcrowns. The people must accept the bare printed words in the budget statements concerning the expenditure of millions of pounds, but when the expenditure is concerned with individual human beings the Government gets down to tin-tacks. I hope that some way will be found to balance the economy of the country other than by subtracting from the sum total of human happiness which goes to make a nation great. There must be other means of economizing than at the expense of the pensioners in the community.
A great deal has been said by the supporters of the Government about their efforts to ease the means test. However, not very much has been done in that connexion, because when Labour went out of office the permissible income of pensioners was £1 10s. a week, which was approximately 26 per cent, of the basic wage at that time, whereas to-day the permissible income is £2 a week, or only about 17 pei- cent, of the basic wage. When the means test was introduced in 1909, when pensions first became payable in the Commonwealth, the permissible income was rated at no less than 20 per cent, of the basic wage. This Government has gone back to pre-1909 levels; it has gone back 44 years in order to bring the permissible income to approximately 17 per cent.
I do not pose as an expert on figures, but anybody should be able to appreciate that the Government has been trying, by throwing about masses of figures, to blind people, not with science but with numerology. Of course, the people will not be blinded all the time. Every election, whether State or Federal, since this Government came to office, and particularly during the last two years, has shown that the optimistic views held by honorable senators opposite are not shared by the general public. I have in mind, particularly, many small businessmen who, when import restrictions were applied under the horror budget of 1951, were forced to close their doors and see the whole of their life’s work go overnight. I admit that certain restrictions and prunings had to be made, but in my opinion they could have been made in a less ruthless fashion. They could have been so applied had the Government, from the first moment it came to office, paid proper attention to the growth of luxury trades, instead of encouraging them and allowing the Australian markets to become flooded with overseas goods which could have been produced in this country. It has been the middle man who has gone to the wall right throughout. The concessions contained in this budget are an endeavour to rescue him, but I am afraid that the Government has left its too little too late. It will have itself to blame for later repercussions.
I reiterate my distress at the fact that the Government has seen fit to offer so little to the pensioners of the community. On the most conservative estimate, a pension of £4 12s. 6d. a week is the minimum that should be offered to bring it up to the 1949 level. I ask, in all sincerity, and I appeal particularly to the women senators in this chamber, who may have some sway with the members of the Government, that something be done to alleviate the distress of civilian widows by at least granting them a domestic allowance, or something of the kind, as a recognition of the fact that they are performing work of national importance. The female basic wage at the present time is approximately £9 a week. If a woman is wrapping up goods in a chain store she is worth £9 a week to the community, but the woman who is bringing up young Australians to become decent citizens is regarded as being worth only £3 10s. a week. On that sum she must keep herself and the children. It is indeed- a tribute to such women that the Government thinks they are such wonderful managers ! However, when a woman is obliged to bring up a family on such a small sum it is likely that she will be the one to suffer and that her children will be deprived of her services when they most need them. I make this plea without any idea of getting votes thereby. This is a purely non-party political matter. It is something on which we, as Australians, should be unanimous. I agree that it is right that people should be brought here from other countries, bur many thousands of pounds have beenspent over the years to bring such people to our shores when all the time, withinthe confines of this land, we have many of the very best settlers we could have, our cwn native Australian children, going hungry, ill-clad and ill-housed, because the various governments have not seen fit to regard widows with children as among their best assets and workers, and recompense them accordingly.
– I support the motion for the printing of the budget papers. At the outset, I wish to say that in my comparatively short experience in this chamber I have never heard such s gloomy lot’ of speeches as those that have been made by honorable senators opposite during this debate. I hope that when my South Australian colleagues take their part in the debate they will at least enliven the proceedings by looking a little more optimistic and expressing their delight with the budget. I am sure I know them well enough personally to suggest that every one of them thinks thai it is a splendid budget. I myself believe that it is. Indeed, it is really better than I expected it would be. Therefore, I am happy to record my hearty support of it.
I am afraid that Senator Tangney, in characteristic fashion, has somewhat exaggerated matters in regard to the hardships and misery being experienced by the women and children of Australia. I believe that, although the ‘ honorablesenator is sincere, she is given to exaggeration. I have been in contact with people in most walks of life, in South Australia at any rate, and I have not seen such misery as she says exists. In fact, I believe that throughout Australia there is an air of prosperity that has never been excelled in our history.
– The honorable senator should look below the surface.
– I do not think that Senator Grant is capable of seeing below the surface any more than I am. An examination of the budget papers will disclose that payments from the Natonal Welfare Fund will amount to approximately 18 per cent, of the total expenditure this year, and if war and repatriation pensions are added, more than 30 per cent, of the total expenditure will be accounted for by social services payments.
I shall now refer to several speeches that have been made by honorable senators and touch upon points that have been underlined by the Leader of the Opposition (Senator McKenna). I have every admiration for the Leader of the Opposition and for his capacity in debate, especially upon legal matters. He is always interesting, but on this occasion his speech lacked conviction. I believe that he knows in his heart that it is a good budget. He criticized high taxation, as- he always has done, but he ignored the fact that the Labour party is an advocate of. high taxation. He also overlooked the high national income that Australia enjoys. Naturally, taxation is high when the national income is on a high level. The Leader of the Opposition constantly twits the Government because it proposed to restore value to the £1. I know that he is within his rights politically, but he knows that we have had a period of inflation, and had the Australian Labour party been in office, it is obvious that all value would have gone out of the £1. I believe that the Government has controlled inflation. Wages have been adjusted automatically to assist the people to meet the inflationary situation.
– Those adjustments have gone now. The Government has wiped them out.
– The Government has not wiped out the quarterly adjustments. They were ended by the Commonwealth Court of Conciliation and Arbitration and I have no doubt that when it reached that decision the court had in mind a substitute system. The Leader of the Opposition also criticized capital works expenditure from revenue. I believe that the Government adopted sound financial practice in constructing capital works from revenue during a period of inflation. Therefore, I believe the criticism of the Leader of the Opposition is not valid. It is all very well to raise loan funds when there is no inflation, but in a time of inflation it is sound financial practice to carry out capital works from revenue when possible.
Senator Willesee has said that this is a political budget framed with an eye to the next election. Who wants to make any pretence about that? Would not the Labour party act in the same way in similar circumstances? Of -course it is a political budget. The Government and its supporters realize that it is incumbent upon them to bring in a good budget in the year prior to the general election so that it will have the result of returning the present Government to office. That is very important for the people of Australia.
– It is very unethical.
– There is nothing unethical about it. When a government brings down a budget,. it tries to introduce an attractive one, especially in the year before a general election. This Government’s budget proposals have to be attractive because it is essential for the welfare of Australia that the Government should be returned to office.
– The Government is only interested in getting back into power. It is riot interested in the welfare of the people.
– The Government wants a continuation of good government for the welfare of the nation. Senator O’Byrne, in his rather halting speech, claimed that the Government’s supporters were not men of imagination. If the people of Australia want men of imagination, I hope that they will not return the Labour Opposition to the treasury bench next year, because I do not believe that the representatives of the Australian Labour party in the Parliament have any talents in that direction.
Senator O’Byrne claimed that great developmental works were waiting to he started. He ignored the fact that during the past three years there has been greater development throughout Australia than ever before. Senator Kendall reviewed the number of houses that had been built, the land settlement, water reticulation and other works that have been set in motion by this Government. Australia’s man-power resources have been strained to the utmost to keep those works going during this Government’s term of office. Senator O’Byrne charged the Australian Government with having treated the States badly. If honorable senators on the Opposition side would study the budget carefully, they would realize that no other government has treated the States in a better manner than this Government has done. “We recognize that the States have the responsibility of carrying out most of the great developmental works in Australia. The Australian Government has certain responsibilities in that connexion, including the Snowy Mountains hydro-electric scheme, but most of the works are the responsibility of the States and they have had valuable assistance from this Government.
Most of the speeches of honorable senators on the Opposition side have been poor, indeed. They have lacked conviction. Evidently they have not an answer to the budget, and I should like to see a more constructive effort from them. The budget with its associated measures is the most important legislation that is brought down by any government. Therefore, I shall discuss the background of this budget, and review the financial policy of the Government from the time that it was elected in 1949. Australia was then in a desperate position. The coffers of the Treasury were empty… In 1949-50, there was a deficit of £25,000,000. There was industrial disruption throughout the country. Shortages of every kind were evident. There were black-outs and black markets and the price level was rising, consistently. It had been rising for a long time and this Government inherited difficult problems from its Labour predecessors.
– Australia had the “best economy in the world during the war.
– I do not suggest that all these things were the result of Labour maladministration. The war was responsible for many of the great difficulties that confronted the Government. A war is always followed by difficult economic conditions. Shortly after this Government was returned to office, there was a steep rise in export prices. A reservoir of savings had been built up during the war when goods were in short supply. Naturally the release of that money had its effect upon price levels. At the same time, production was deplorably low throughout Australian industries. Confronted by these problems, the Government had to surmount many difficulties in its first budget in 1950-51. It brought down a budget that was not very different from the budget of the Chifley Government. Reference has been made to the so-called wool grab. It was not a grab at all but a logical scheme that resulted from the fact that, following Labour’s ejection from office, this Government inherited an empty Treasury, and, at the same time, was faced with commitments that had been entered into by Labour. One of those commitments was the payment of war gratuities. That was an honorable commitment. In addition, this Government had to provide the sum of £50,000,000 for the stockpiling of war material. Those were the circumstances in -which this Government introduced its first budget ; and, despite the difficulties that it encountered it met all its commitments and balanced that budget. The next budget that the Government introduced, in 1951-52, and which has been described in most unfair terms by members of the Australian Labour party, contained proposals which subsequent events fully justified. Under that budget, the Government, in spite of the unpopularity of such action, increased taxes. At that time, we had begun to feel the impact upon our economy of rising wool income which, in the preceding year, amounted to £286,000,000. For that reason, the Government introduced its scheme for the prepayment of tax by woolgrowers. That action was more than justified by events in the following year when Australia’s wool cheque exceeded £600,000,000. It was recognized that that vast income would filter through the economy and cause prices to rise substantially.
– Why did not the Government reevaluate the Australian £1 at that time?
– I am surprised that Senator Grant should mention the subject of revaluation, because I recall that a divergence of opinion existed among members of his own party on that matter. For instance, while the honorable senator himself strongly advocated it, Senator Armstrong spoke very strongly against any suggestion that the Australian £1 should be revalued. However, I shall not be diverted from my theme. The impact of our high wool income upon our economy soon became apparent. That additional money filtered through the economy and contributed to the inflationary trend. The Government handled the situation that then existed with great courage and skill. It revealed great foresight in advancing the proposals that were contained in the budget for 1951-52 which, as I have said, it knew would be most unpopular. What would the Australian Labour party have done in similar circumstances if it had been in office at that time? The Attorney-General (Senator Spicer) posed an interesting query to the Opposition when he asked what a Labour government would have done with the additional £300,000,000 that we received for our wool at that time. Would Labour have frozen that money? No. I have not the slightest doubt that it would have attempted to control price levels, because it regards prices control as a panacea for all our economic ills in spite of the fact that such control, during the. years immediately preceding this Government’s advent to office, had been proved to be a dismal failure. At that time, black markets flourished throughout the length and breadth of the land, and prices continued to rise. It is sheer nonsense for honorable members opposite to say that in the circumstances that I have mentioned Labour, if it had been in office, would have adopted fiscal and financial methods different from those upon which this Government relied to cope with the situation. If Labour had been in office at that time it, would have been obliged, whether it liked it or not, to adopt similar remedies.
I come now to the budget which the Government presented in 1952-53 and which was favorably received throughout the country. As a result of the stringent measures that the Government had taken1 in 1951-52, it was able to afford considerable relief to the people. It reduced income taxes, on the average, by 10 per cent.; it substantially reduced the rates of sales tax; it abolished land tax; and, at the same time, it made substantial concessions to primary producers in order to enable them to increase production. The Government finished that year with a surplus of £13,000,000. I repeat that during the last three financial years, the Government, regardless of the unpopularity of the measures that it took, shouldered its responsibilities and, in the interests of the nation, applied effective remedies to our economic ills. In that way, it succeeded in stabilizing the economy. By increasing taxes it drew off certain surplus purchasing power. It, reimposed capital issues control for the purpose of diverting labour and materials to essential industries. At this juncture, I refer to the important conferences on economic affairs that have been held in London during recent years. The first of those conferences was attended by the Treasurer (Sir Arthur Fadden), and the Prime Minister (Mr. Menzies) attended the second conference. The findings of those conferences completely vindicated the financial measures that this Government had taken to combat inflation.
At the same time, the Government tackled the problem of increasing production and, in this respect, achieved the most striking results compared with anything that the preceding Labour Government had achieved. Production in basic industries was increased, and ‘equilibrium between goods and services and the purchasing power of the community was established. It is against that’ background that we are presented with ‘f he budget now before us. This budget has won the confidence of the great majority of the people. All sections of the community have given it their approbation. It is no mean achievement. that the Government is now able to reduce income tax on the average by 12$ per cent. At the same time, it proposes to exempt from the payment of pay-roll tax the great majority of employers who hitherto have been paying that tax. Entertainments tax is to be abolished, and rates of company tax, in respect of both public and private companies, is to be substantially reduced. In addition, worthwhile concessions are to be made to taxpayers in respect of costs incurred in the education of their children. I say without hesitation that this budget will help to reduce present high costs which constitute one of the most serious problems that now confront this nation. Indeed, costs have risen to such a degree that we have costed ourselves out of some of the most valuable markets for our primary products. Above all else, this budget can be described as an encouragement budget. The proposed reductions of taxes will, in the long run, have the effect of reducing costs of goods and services to the people and of increasing production.
One of the primary aims of the budget is to bring about a lowering of costs, and I am confident that it will achieve that objective. I admit that sums of great magnitude appear on the expenditure side. I refer, for instance, to defence expenditure which, during the coming year, is estimated to amount to £200,000,000, although last year expenditure under that heading was £215,000,000. We cannot ignore our commitments in respect of defence. We- must maintain adequate defence services. Nobody would suggest that we should shirk that responsibility merely in order to effect so-called economies. I could give many other expenditure figures, but it would take too much time to deal with each one individually, and no good purpose would be served by so doing. Total expenditure is estimated at £981,000,000. The percentages that are to be expended on social services, repatriation, defence, and grants to the States have been given. We, as senators, are primarily responsible to the States. Our principal obligation is to represent the States in this chamber. It is quite clear that the States are not being neglected under this budget. They are to receive approximately £188,000,000, which is an enormous sum. I am pleased to say that the Premier of South Australia, the State that I represent, did not make extravagant claims for Commonwealth reimbursement grants when the matter was discussed in Canberra recently. He felt that it was of primary importance that taxes should be reduced. In spite of some of the comments of some Labour Premiers, the States are adequately provided for in this budget.
The budget is, as I have said, the most important measure that comes before the Parliament. I believe that this Government has achieved much. Its methods are dissimilar from those of the Labour party. It has controlled the economy by financial measures rather than by onerous economic controls such as prices control, and it has succeeded in stabilizing the Australian economy. Inflation has been arrested. The balance between supply and demand both in respect of goods and services has been restored. We can look forward to prosperity in the year that lies ahead. I am certain that when the people of Australia are fully aware of the implications of the budget - already there is evidence that those implications are receiving widespread recognition - they will realize that this is a good government and that it deserves to be returned to office in the House of Representatives next year. I have every confidence that with a continuation of the sound administration that the Government has displayed in the past, Australia will continue to prosper.
– Much has been said by Government spokesmen about increased primary production under the administration of the Menzies Government. The Treasurer (Sir Arthur Fadden) himself has claimed that the increase of primary production has played no small part in the improvement of the balance of payments position. A brief summary of salient facts and figures of this reported increase is illuminating. The year 1951-52 was by no means one of the most favorable seasons on record. Consequently, a true appreciation of the 1952-53 estimates of primary production can be gained only by comparing them with production figures for previous years. We find that the estimated butter production of 165,000 tons for 1952-53 is considerably below the 1938-39_ figure of 195,000 tons. The estimated milk production for the same period is also below the pre-war levels. The estimated production of beef and veal, although high, is considerably below the 1950-51 figure, and the estimated production of mutton and lamb is below the 1949-50 figure. Estimated wool production is very high, but it is still 19,000,000 lb. less than the record of 1,169,000,000 lb. in the 1933-34 season. The much publicized wheat production estimate of 1.93,000,000 bushels is lower than the figures for 1947-48 and for 1949-50. Wheat acreage has been considerably reduced. Those figures demonstrate the emphasis that must be placed on primary production if the needs of our rapidly growing population are to be satisfied and a surplus is to be available for export.
The lesson to be learned from primary production in this country is that Australia i3 depending too much on wool for its prosperity. To a certain degree this excessive reliance on wool can be attributed to the high prices that have ruled for that commodity, and to the high profit margin in the wool industry compared with other primary industries. The need for higher and better balanced primary production is one of our greatest, problems. Unfortunately in the past it has been contended that there is plenty of time to find a solution of this problem ; but to-day, with synthetic materials achieving rapid popularity, the danger of depending too much on wool production in the future must be. only too obvious. The need for higher and better balanced primary production is now generally recognized. There is also a wider realization of the fact that if we were to meet with an adverse season, not only would we have no food to export, but also we should be struggling to feed our own population of more than 8,000,000 people.
Turning again to wheat production, I may say that largely because of our own propaganda, we have come to regard Australia as one of the world’s greatest granaries; but measured by American and Canadian standards, our efforts as a wheat, producer are relatively small, lt will be a shock to the average Australian to learn that “France, for instance, is higher than Australia on the list of wheat-producing countries. When we realize that an admittedly poor agricultural country such ai Italy, which is only about one and a half times the size of Victoria, can better Australia in both total yield and production to the acre, we can see that the problem calls for serious consideration. The yield in Italy this season is estimated to exceed 314,000,000 bushels. Our yield last year was approximately 193,000,000 bushels. The average yield to the acre in Italy during the past four years has been 24.9 bushels. Last year, wheat production in this country averaged 19 bushels per acre, almost an all-time record. The increase of wheat production in Italy is claimed to be the result of new agricultural methods. I realize that comparisons between two countries so widely different in soil, topography, climate and farming techniques can be carried too far. Nevertheless, Italy’s production figures constitute a challenge to Australia. Admittedly, it is a grim necessity for over-populated Italy to grow as much wheat as possible. Food has to be provided for hungry people. There is not the same incentive to production in Australia. Indeed, as I have already pointed out, many of our primary producers have switched from wheat to wool and meat because of the high prices prevailing for those commodities, and because of the higher profit margins that they offer. Of the 193,000,000 bushels of wheat produced here last. year, 80,000,000 bushels were used for home consumption, 90,000,000 bushels were exported, and the balance was carried into stock. Of the 80,000,000 bushels used for home consumption, approximately 50 per cent, was consumed as flour, 30 per cent, as stock feed, and 17 per cent, was used for seed and other farm purposes. The value of wheat and flour exported was approximately £90,000,000 or 10 per cent, of the total value of our exports. Wool constituted 45 per cent, of our exports. Of the wheat and flour exported, 25 per cent, went to the United Kingdom. India and Ceylon took a. similar quantity between them, and smaller but still important buyers included New Zealand, Malaya. Pakistan, Indonesia, Germany and Eire. Our wheat acreage has gradually declined from 13,000,000 acres prior to the war. to 10.000,000 acres “ last season. The yield, however, ha? increased from 12 bushels to 15 bushels to the acre. As I said before, because of the unusually good growing conditions our yield averaged approximately 19 bushels an acre.
– The yield was 23 bushels an acre in South Australia.
– That is so. This country is one of the four main wheat producing countries of the world, the others being the United States of America, Canada and Argentina. The wheat yield in the United States of America last season was 1,200,000,000 bushels. There was a surplus of 550,000,000 bushels available for export, but only about 60 per cent, of that surplus found its way into the export markets. Canada produced 690,000,000 bushels of wheat last season. Of that quantity 160,000,000 bushels were used for home consumption, leaving 530,000,000 bushels available for export. The production of wheat in Argentina last season was 290,000,000 bushels, of which 115,000,000 bushels were utilized for home consumption. Our proportion of wheat for export amounted to about 8 per cent, of the wheat exported from the four exporting countries, but because our wheat was sold for non-dollar currency we accounted for about 11 per cent, of” the total wheat exported. Last season there were huge surpluses of wheat in the United States of America and Canada, amounting to 1,300,000,000 bushel? - almost double the quantity that was held in stock the previous year. Because of that huge surplus the United States of America was compelled to take immediate action. The wheat-growers of that country co-operated with the United States Government and, by ballot, adopted acreage reduction subject to the Government undertaking to pay 90 per cent, of the parity price of wheat. That was a good thing for Australia, because our wheat industry would have suffered a very heavy blow if the wheat-growers of tho United States of America had not agreed to accept that proposition. We now have another opportunity to place our wheat industry on a stable basis, but the matter .has been badly mismanaged, duc to the procrastination and maladministration of this Government. Stabilization should have been taken in hand twelve months ago.
During the last Senate election Labour warned the Government of the position that was developing. If the anti-Labour parties had supported Labour’s referendum, whereby the Commonwealth sought power to arrange for the orderly marketing of wheat, the Government would not now be in such a difficult position. As I have said before, the Government should have persuaded the State governments to take a ballot of the farmers in relation to stabilization. There has been continued procrastination during tho last eighteen months despite the fact that the Government knew that this problem was coming to a head. As I have asserted before, the only solution of this problem is to place more nien on the land; production would then increase, as a natural consequence. This has been proved by the great success of the land settlement scheme for ex-servicemen. In Victoria alone there are no less than 6,000 unsatisfied applicants for farming land. In our overcrowded cities there are thousands of farmers’ sons with the necessary experience, waiting to become landowners. But it is useless to place these people on the land unless they are given everything that they need to increase production. It is absolutely essential that primary producers shall receive a fair and reasonable reward for their efforts. They must be able to obtain all the labour that they require, because without additional labour there can be no increase of primary production of any magnitude. Farmers must be guaranteed prices for their products sufficiently high to enable them to pay fair and reasonable wages to their employees and provide them with decent housing accommodation and everything else necessary to keep them happy and contented. It must not be forgotten that during the past ten years more than 70,000 rural workers have left the land. If things that I have mentioned are provided I feel sure that rural workers will not be found wanting, but will assist the primary producers to increase production.
This budget is based on pure and undiluted fictitious reasoning and supposition. It is absolutely false and misleading, and will be extremely harsh and cruel on pensioners and other recipients of social services.
Its application will cause great public indignation throughout this country. I -assure honorable senators that there will be tremendous repercussions from the Government’s exaggerated propaganda in relation to its so-called genuine taxation reductions. The campaign that was started by the Government parties just prior to the last Senate election has been continued during the last five months. The people of this country will show their resentment of the budget in no uncertain manner when the opportunity arises for them to do so. They remember the promises that the leaders of the anti-Labour parties made in 1949 to put value back in to the £1, increase the purchasing power of wages, reduce the cost of living, and to reduce taxation. Those definite and unqualified promises have been repudiated in the budget that we are now considering.
The Treasurer stated in his budget speech that taxation reductions would be worth an estimated £118,000,000 a year to the taxpayers, but the fact is that the Government proposes to raise £875,000,000 by taxation this year, compared with £886,000,000 last year. That is an actual reduction of £11,000,000, not £118,000,000 as claimed by the Treasurer. Individual taxation is to be at the rate of £398,000,000, which is £11,000,000 more than the amount that was collected last year. At the same time sales tax in this financial year is expected to yield the huge amount of £88,000,000, “which is only £1,000,000 less than the yield last year. The general rate of sales tax is to be maintained at 12-& per cent., compared with 8i per cent, when this tax was introduced by the Chifley Labour Government in 1949. In addition, an extra £7,000,000 is to be collected in excise and an additional £12,000,000 in customs duties. Yet Senator Hannaford claims that this budget will be popular with the people! As 1 have said before, the people of this country will show their resentment against the budgetary proposals in no uncertain, manner when the opportunity arises. This Government will go into political oblivion, where it rightly belongs, and the next Labour government will have to clean up the mess. The outcome of the next general election is a foregone con- elusion. Labour will get the Australian economy back onto a sound basis, and will bring down a decent budget next year.
– I think that a fair test that will be applied by any one not in politics will be “ How will this budget affect the great bulk of the people?” I am sure that the answer will be that it is the kind of budget that the people have been waiting for. I confess that I myself was among those who were surprised when they heard of some of the budget proposals. This budget has been described as a political budget. If that term means a budget that is brought down quite cynically in order to catch votes, this is not a political budget because it is based on a long and careful study of the needs of the country and what can be done to meet them at the present time. During the last three years the Treasurer (Sir Arthur Fadden) and his officers, as well as supporters of the Government, have considered from time to time what was necessary in order to preserve the economy of the country, and we did unpopular but necessary things. That is the only sense in which this budget can be regarded as a political budget.
We have had to do drastically unpopular things. One thing that stunned me completely was the sudden restriction of imports. I am afraid that had I been asked to express my opinion at the time, I would have been strongly against that course of action. Very fortunately, I was not asked. I believe that those who had all the facts at their fingertips did the right thing. By drastically curtailing imports the Government saved the Australian economy. We are now able to relax the restrictions gradually and to relinquish indirect controls that the Government was forced to exercise, in order to give back to the people of this country a great measure of individual sovereignty. We are individualists in the old sense of the term. It is a pity that that term has become battered, and that an individualist is now looked upon as a selfish person who wants to do something in order to gain an advantage for himself. The opposite was the case when I was a boy. In those days an individualist was a person who possessed the courage of his own convictions, and who wanted income not for selfish pleasure but in order to enable him to do things for the good of the community. We’ believe that the proper person to spend money is the man who earns it. We believe that if people provide for their own old age by accumulating wealth, they are able to do more good in the world than they could in other circumstances. That is what this budget in intended to accomplish. Since this Government came into office in 1949 it has been forced to do many things that it opposed in 1949. I am willing to answer Senator Grant’s question as to why we did not retain capital issues control. I now think that it is a pity that we relaxed certain controls in 1949, but the whole community was sick and tired of the shackles which had been imposed on it for seven or eight years. The whole community cried out for freedom. They wanted the shackles to be taken off. When capital issues control was removed some people did what was right and some did what was wrong. Consequently the Government had to reimpose those controls. It is a pity that when people have a chance to finance new industries they are inclined to put their money into frivolous projects. Having allowed perfect freedom from capital issues control for some months the Government did reimpose the control. But never has the Government imposed a control unless it was required by the existing circumstances.
It was not the socialists who won either of the last two world wars. In the first world war there was first a moderate Labour party, then a Liberal party and finally a Nationalist party government in Australia. In the second world war it was the United Australia party which laid the foundations upon which the war was won.
– Why did the United Australia party go out of business ? Tt was because of the disgrace of having to run out when the war started.
– I know why the United Australia party went out of business, but I wish to discuss the budget. The most important element in this budget is the generous relief that has been proposed for millions of taxpayers. I have not heard any detailed criticism of income tax reductions from honorable senators opposite. The reductions have been proposed in accordance with the principles of equity, and by observing the principles of graduation that were used in building up the tax. Every one in the community will receive relief from income tax at an average rate of 124 per cent. In other words, everybody will have a larger income. To the extent of their taxation reductions, everybody will be able to buy more for himself than he could buy previously. The proposed reductions in sales tax will help every consumer in the community, whether he wishes to buy what may be called a luxury or a necessity. The proposed reductions of sales tax will be equivalent to additional income for everybody. I look forward happily to buying my Christmas presents because I shall memorize the sales tax schedule and pick out the items that have been reduced.
– What about the pensioners ?
– Senator O’Byrne always wants to make other people’s speeches as well as his own. The Government’s proposals in relation to pay-roll tax will relieve about 50,000 employers of the necessity to pay this tax. In the main, these will be the owners of small businesses. I have always detested the pay-roll tax. When I first presented myself as a Liberal candidate for Parliament I strongly advanced the argument that the pay-roll tax should be completely abolished. I now believe that that is impossible, but it is good that the great bulk of the small employers, the people with confidence and imagination who will become the big employers of the future, will be relieved of . this burden.
The company tax is one of the central subjects on which we- differ from the sincere Opposition senators who really believe that the general well-being of the people could be improved by taking business out of the hands of companies and individuals and putting it all into the hands of governments. A big company is not merely a despot or a wealthy concern which controls other people and builds up its own wealth. T doubt whether there is any such company in Australia at present. There have been such companies in the past, but let us see what becomes of the profit of big companies. Such profit may enrich a few individuals and allow them to. spend money unwisely on luxuries. But it also provides a small accretion of income to a large number of individuals. I have a few small investments, some of them in big companies. I have 50 shares in one of the biggest retail companies in Sydney which bring me in a few pounds a year. I believe that thousands of people are in my position. Nobody should know that better than Senator Grant because his broker is my broker. He has investments, possibly smaller than mine–
– I have none.
– The honorable senator did have some investments. He might have sold out at the top of the market. But there was a time when Senator Grant made investments and he knows that the proposed reduction in company tax will provide higher incomes for small investors. The accumulation of wealth in big companies results in wealth being left for the endowment of educational and charitable institutions. Such use of wealth is admirable. It is excellent that universities, orphanages and hospitals should have private endowments of their own which provide them with money for which they do not have to ask the Government every year. One of the great dangers of making the State the main source of benevolence is that we are likely to become the serfs of the State. The late Hilaire Belloc informed us of that fact when most people including myself were under the spell of the socialists. One of the best aspects of the accumulation of wealth in private companies is that ultimately the larger part of it is used for charity and education in such a way that the people administering the funds can do as they wish with the money. I know something of the Burnside Homes which were established by a munificent endowment from three wealthy Scotsmen who gave their money to the church to which they belonged and to which I belong. There are many other such institutions. We should all be much better off if taxation policy was directed more towards inducing that kind of endowment than in making everybody dependent on the State. The idea of rich companies is a bogy, [t used to look wonderfully well in The Worker cartoons, which showed enormous fat gentlemen grabbing the wealth. Where are the fat gentlemen these days’? Most of them are dead and most of their money is in the possession of admirable institutions. So the remission of companies tax will not merely benefit a few wealthy people. I admit that some wealthy people will be better off, but a large number of people on moderate incomes will be better off also.
The capital of a big company is also put to another purpose. It goes into reserves and is used to buy capital goods. That is good. Economists generally, including socialist economists, commend that state of affairs. Many of our companies lack the equipment that they need in order to take advantage of modern methods of production. What is called “ capital erosion “ is taking place. Funds for the provision of modern machinery is one of the greatest needs of our economy. So let us dispose of the stupid idea that remission of company tax is merely a present to the wealthy man. The Government’s proposal will give something to the wealthy man, but it will give a great deal to a number of people who are not wealthy. It will enable something to be left to posterity for educational and charitable purposes and it will make possible the strengthening of capital reserves.
Debate interrupted.
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The PRESIDENT (Senator the Hon. A. M. McMullin). - ‘Order! In conformity with the sessional order relating to the adjournment of the Senate, I formally put the question -
That the Senate do now adjourn.
.- I wish to refer to an anomaly that exists in regard to rentals paid by officers of the Postmaster-General’s Department. I believe that the policy of providing homes for employees of the department, other than postmasters, was instituted when Senator Cameron was PostmasterGeneral, and that it is also the policy of the present Government, although it has not been given effect to a great degree. The rental of .premises occupied by a postmaster is assessed at 10 per cent, of his salary, whether the premises are attached to the post office or not. That, I suggest, is a reasonable method of assessing the rental. However, when a house is provided or built for a line f orel.vin, for example, the rental is 6$ per cent, of the capital cost.
– That is a very low percentage.
– Not when the capital -cost of building a home at the present time is taken into consideration. The result is that line foremen are obliged to pay £4, £5 and even as much as £6 a week in some instances, for rent. As they receive a smaller salary than do postmasters, they suffer considerable hardship. Even when homes are built for them they are not over eager to occupy them because of the high rentals which apply.
– How does thai assessment of rental compare with the method of assessing ‘ rentals of newly -constructed State houses?
– I understand that the rental of a newly constructed .State house is approximately 5 per cent, of the capital cost. However, the Postmaster-General’s Department does not build several houses at a time, as do the State housing authorities. .It erects homes individually, some of them being in out-of-the-way country districts. At the present time, a house is being built at Queenstown for the line foreman for the coast. ‘ When individual homes such as that are built, -the capital cost is very much greater than it is in the case of a number of houses -erected at the one time. I understand that the cost of an ordinary kind of house, such as those erected with Agricultural Bank finance in Tasmania at the present time, is between £1,850 and £2,200. The result is that the rental -of such homes is approximately £3 2s. 6d. -a week.
I do not wish to see the rentals of houses occupied by postmasters raised simply because line foremen and others are obliged to pay high rents, but I should like this anomaly to he removed. Because the matter concerns a Commonwealth department, Cabinet consideration of it is necessary. Homes must be found for line foremen if telephone services are to be supplied and maintained in the various districts of Tasmania. In many instances, of course, line foremen provide their own accommodation, but some of it is substandard. That is so in the case of the. residence of the line foreman at Zeehan. In my opinion, it should be the policy of this Government to provide suitable homes for such employees of the PostmasterGeneral’s Department.
– Would the fact that a postmaster is obliged to pay 10 per cent, of his salary by way of rent be taken into account when his ‘ salary is determined ?
– -No, I do not think that it would be. That system does not apply in State departments, and I am sure that it does not apply in the PostmasterGeneral’s Department.
– If a hardship or an anomaly exists, as the honorable senator has stated, I am sure that the Postmaster-General (Mr. Anthony) will he only too pleased to investigate the whole position. I undertake to bring to his notice the matters raised by the honorable senator.
Question resolved in the affirmative.
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The following papers were presented : -
National Debt Sinking Fund Act - National Debt Commission - Thirtieth Annual Report, for year 1955J-s3.
Public Service Act - Appointments - Department -
National Development - P. E. Goodeve Repatriation - T. E. McGuire.
Senate adjourned at 10.37 p.m.
Cite as: Australia, Senate, Debates, 17 September 1953, viewed 22 October 2017, <http://historichansard.net/senate/1953/19530917_senate_20_s1/>.