Senate
28 September 1954

21^st Parliament · 1^st Session

QUESTION
- CIVIL AVIATION
QUESTION
- IMMIGRATION
QUESTION
- SHIPPING
QUESTION
- SCALLOPS
QUESTION
- CANBERRA
QUESTION
- TIN
QUESTION
- WINE
QUESTION
- WHEAT
QUESTION
- WAR MEMORIALS
QUESTION
- BROADCASTING
APPROPRIATION (WORKS AND SERVICES) BILL 1954-55
- Second Reading
APPROPRIATION BILL 1954-55
- Second Reading
ADJOURNMENT
APPROPRIATION BILL 1954-55
- Second Reading

Senator McLEAY:
LP

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

The Australian representatives to be present at the ceremony at El Alamein on the 24th October will consist of four relatives of deceased ex-servicemen who are buried or commemorated at El Alamein, plus one representative of the Returned Servicemen’s League, and Major-General A. H. Ramsay, who will be representing the Services.
A letter has been despatched to all interested next of kin, inviting them to submit an application and these applications close with the Secretary-General of the Imperial War Graves Commission,622 St. Kilda-road, Melbourne, on the 20th September, 1954.

page 512

QUESTION

BROADCASTING

Senator AMOUR:
NEW SOUTH WALES

asked the Minister representing thePostmaster-General, upon notice: -

Is it a fact, as reported in the press, that the Australian Broadcasting Commission proposes in future not to broadcast reports of interstate races over Station 2FC?
If so, and in view of the fact that the Broadcasting Act provides that the Australian Broadcasting Commission shall provide programmes suitable for every section of the community, and as racing is one of the most popular sports in Australia, will the Post- master-General inform the Senate whether this dictatorial decision was made by the Australian Broadcasting Commission or the General Manager of the Australian Broadcasting Commission?
Will he state whether it is the desire of the Australian Broadcasting Commission to hand over sporting broadcasts to the commercial broadcasting stations?
Will he also state the authority of the Commission to alter a programme that has been in operation for some time and which is enjoyed by people in the far-flung parts of our nation, who expect to hear broadcasts of matters of importance and interest to them, such as broadcasts of interstate races?

Senator COOPER:
Minister for Repatriation · QUEENSLAND · CP

– The PostmasterGeneral has furnished the following answers : -

The commission has not decided to discontinue reports of interstate races, but to confine these to the more classical events. Results of interstate races will be continued as formerly.
No decision was made by the Australian Broadcasting Commission.
No.
The commission is continually altering programmes with a view to serving the whole body of listeners whose tastes in sport, as in all other matters, vary widely. The present decision is designed to reduce the interruptions to the broadcasting of State sporting fixtures which many listeners find irritating.

page 512

APPROPRIATION (WORKS AND SERVICES) BILL 1954-55

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Spooner) read a first time.

Second Reading

Senator SPOONER:
Minister for National Development · New South Wales · LP

.- I move-

That the bill be now read a second time.

The provision in the 1954-55 Estimates for expenditure on capital works and services is £104,633,000, made up of £99,783,000 from annual votes and £4,850,000 from special appropriations.

This measure, which should be read in conjunction with the Supply (Works and Services) Act 1954-1955, provides the necessary Parliamentary appropriation for the expenditure under annual votes, which may be summarized as follows: -

Details of the proposed expenditure will be found in pages 217 to 229 of the printed Estimates, and in the schedule to this bill. The total provision of £104,633,000 is £10,500,000 greater than the actual expenditure in the last financial year. The major proportion of the 1954-55 provision is required to continue works in progress, and to meet other outstanding capital commitments. The new works included are those of an especially urgent and essential nature.

The .bill provides £30,000,000 for expenditure on war service homes or £3,200,000 more than was expended in 1953-54. This substantial increased provision is renewed evidence of the determination of the Government to make the maximum possible provision of homes for ex-servicemen.

An amount of £27,215,000 is included in the bill for Post Office buildings and equipment. This represents an increase of £1,500,000 over last year’s expenditure. In addition, supplies and equipment costing £1,500,000 will be provided from stocks held in the Post Office Stores and Services Trust Account.

The provision this financial year to cover expenditure on the Snowy Mountains hydro-electric power scheme is £14,200,000, being an increase of £1,000,000 over 1953-54 expenditure.

The amount of £6,150,000 for the Department of Civil Aviation includes £3,550,000 for the acquisition and construction of aerodromes as well as £2,100,000 for the purchase and installation of modern technical equipment.

Included in the Department of Health Estimates is a further amount of £1,500,000 for reimbursement to State Governments of capital expenditure incurred under the Tuberculosis Act 1948.

An amount of £1,200,000 is provided for the Commonwealth Railways, mainly for the purchase of further diesel locomotives and other rolling stock. In addition, £650,000 is included for expenditure in South Australia under the Rail Standardization Agreement.

Under the Department of Shipping and Transport, £4,000,000 is provided for ship construction in Australian dockyards but against this is offset an amount of £700,000 estimated to be received by the Australian Shipbuilding Board in respect of vessels which are under construction for sale to private shipowners.

The continued development of the Northern Territory and the Australian Capital Territory is estimated to cost £2,464,000 and £4,302,000 respectively in this financial year. The provision in the Australian Capital Territory is mainly to continue the housing programmes and for associated engineering works. The increase of £1,000,000 in the amount provided for capital works in the Northern Territory is a further indication of the Government’s determination to accelerate the development of the Territory.

Debate (on motion by Senator McKenna) adjourned.

page 513

APPROPRIATION BILL 1954-55

FIRST Reading.

Debate resumed from 23rd September (vide page 508), on motion by Senator SPOONEE -

That the hill be now read a first time.

Senator McKENNA:
Leader of the Opposition · Tasmania

– The Senate has been asked to consider a bill appropriating £289,138,000 for the provision of ordinary annual services of the Government. Having regard to the fact that the total expenditure under the budget is over £1,000,000,000 for the current year, the figure that I first mentioned seems an inordinately small amount but, of course, we need to remember that supply was given in Parliament covering a period of four months to the extent of £151,000,000 and that, with the amount now stated to be appropriated, makes a total of about £440,000,000. But even that figure which the Senate is now considering, is small in proportion to the total expenditure of the Commonwealth for this financial year. It is a rather surprising thought that far more than that, about £510,000,000 has already been especially appropriated by acts of Parliament which have regularly appropriated amounts for particular purposes. The amount that is payable to the States under the formula relating to income tax reimbursement is a case in point. It totals more than £130,000,000. That amount does not come up for review in the budget as it has already been appropriated, and under that heading, honorable senators will merely be concerned with an appropriation of about £20,000,000 to supplement the formula grant of £130,000,000. Again, the Senate is not considering the vote of £104,000,000 for capital works of the Commonwealth.

During the discussion of this measure, honorable senators get the opportunity, on the motion of the first reading, to discuss matters that are both relevant and not relevant to the bill. They have an opportunity to review the operations of last year and to look forward to the period that is ahead of Australia. When considering the measure in committee honorable senators should be careful to use the schedule to the bill. Year after year we are disposed to use the Estimates that have been furnished on the motion that the papers, meaning the budget papers, be printed. I warn honorable senators that all the pages are completely renumbered in the schedule to the Appropriation Bill, and it would be advisable for those who have made notes on the Estimates that were previously before the Senate to transfer their notes to the schedule items in the bill itself.

– I say that the newspapers had the information, so they must have been supplied with it. One heading read, “Tax Cuts up to 10 per cent.”. The report stated -

The budget will contain tax cuts ranging between 7 and 10 per cent.

The report carefully avoided stating that the reduction of income tax would be 9 per cent., as it turned out to be. Another statement that was published in advance of the budget was as follows : -

Defence expenditure will run at £212,000,000. which includes £12,000,000 already in the reserve fund.

That was exact information that appeared subsequently in the budget.

Senator McCallum:

– Senator Ashley has informed the Senate often that that has been the regular figure for many years.

Senator McKENNA:

– The newspaper mentioned the vote of £200,000,000 and. £12,000,000 in reserves. That is exact information and there is no reason to expect that any newspaper representatives could have concluded that £212,000,000 would be provided. The defence vote might well have been much greater. One newspaper reported -

No reduction in excise on beer, cigarettes or tobacco.

Let me refer, for a moment, to the inflation that may exist throughout next year. The Treasurer has claimed that last year was a year of stability. Far more accurately, the report of the Commonwealth Bank described it as a year, of relative stability in comparison with the years that preceded it, which is a very different thing. The Government can claim no credit for the temporary and completely artificial stability that was a mark of last year’s economy. It was not the Government that stepped in and did anything to halt the inflation. It was the action of the Commonwealth Arbitration Court in pegging the basic wage in September, 1953, and denying further cost of living adjustments that held up proper adjustment of margins for skill. That has been the greatest economic factor in producing stability. I have heard criticism in this Senate, again from a Government supporter - and quite properly - of the fact that such a great economic function, in effect a legislative function, should be wielded by a court. It seems to me that anybody who is seized with a sense of responsibility must appreciate that ultimate decisions in matters that involve great economic issues should be made by the Parliament, and sooner or later the people of Australia will be educated to the need for such a change. At all events, the Government can take no credit for what, in effect, was the practical pegging of wages by the court, particularly as the burden of halting inflation falls mostly on the wage and salary earners. The Government can have no pride in the fact that, mainly because of cost of living adjustments, the basic wage almost doubled during its term of office.

Our position to-day is that we are poised right at the top of an inflationary spiral. Our industries are competing with imports from abroad. All kinds of manufacturers in this country are in trouble, such as our fruit processors and our meat and fish canners. Recently, we had a discussion in the Senate about the difficulties of the berry fruit-growers because of the troubles of the processing industries. That trend may be traced throughout industry at the present time. A little while ago I applied to the Minister for Trade and Customs (Senator O’sullivan) with a view to ascertaining what had been going on in the matter of tariff applications during the previous eighteen months, and the Minister was good enough to obtain for me a complete report from the chairman of the Tariff Board, which he sent to me under cover of a letter dated the 20th July last. That report discloses an extraordinary position. It shows that in 1953 there were 42 applications to the Tariff Board for assistance. In addition, 24 applications were received during the six months to the 30th June last, making a total of 66 during a period of eighteen months. Only two of those applications were withdrawn. It is true that some industries of relative unimportance to our economy are shown on the list, but the fact that industries which produce the following goods are shown indicates that major industries are involved : Cotton sheeting and pillow cases, rayon tyre yarn and rayon tyre cord, cooking stoves and ranges, timber and timber products, cutlery for domestic and catering purposes, tin - to which reference was made here to-day, flex, paper, copper, footwear of all types, cork .products, ribbons, galloons, dress trimmings, moquettes of the type used for upholstery, toys, aluminiumware of the kind ordinarily used for household purposes, incandescent pressure lamps and lanterns, vegetables - dried, salted, concentrated, compressed or powdered, and the Australian shipbuilding industry is also listed.

It can be seen, therefore, that major industries are in difficulty. If further evidence of that claim were required, reference could be made to the speech of the Minister for Trade and Customs, not so long ago, when he introduced a measure to increase the personnel of the Tariff Board, so that two tariff boards could sit at once, a move that was supported by the Opposition. Those are all signs of the difficulties in which Australian industry finds itself to-day.

Again, the human element comes into the picture. People find their calling jeopardized by the high cost structure, by the mounting tide of imports, and by declining income from primary production. Australians are conscious of all those things and are becoming worried about the future. They see little hope of the Government helping to reduce prices.

Substantial reduction or total abolition of sales tax and pay-roll tax would play a large part in reducing costs. Both taxes are added to production costs, thus having a multiplying effect. It is well known that everybody concerned with the handling of goods, from the original manufacturer down, adds his percentage to the cost of sales tax, and it is probably true that by the time the process runs its full course, the total amount constitutes double the burden that the original amount of sales tax would have caused. What has been the approach of the Government towards relief in this matter? All forms of taxation are expected to yield about £901,000,000. The proposed remissions of sales tax and pay-roll tax will result in a- loss of revenue of about £9,800,000 and £1,500,000 respectivelya total of about £11,300,000 in this financial year. This insignificant remission is only a little more than 1 per cent, of the expected total revenue of the Commonwealth in this financial year. In other words, it is an infinitesimal contribution to the attack on the high and ruinous cost structure of this country.

I come now to another aspect of the matter which has caused a lot of doubt in the minds of the general public. The Treasurer collected about £897,000,000 in taxation during the last financial year. He claims that he will let them off to the extent of £35,000,000 in this financial year. The general public therefore expects that about £862,000,000 will be collected in taxation in this financial year. Instead, the Treasurer has budgeted to collect about £4,000,000 more than in the last financial year. In other words, the Treasury will benefit to the tune of £39,000,000. In an earlier year, a similar thing happened. In 1952-53, the Treasurer collected £885,300,000 in taxation, and announced a reduction of £81,500,000 for 1953-54, when he imposed a levy to the order of £803,000,000. But, in truth, he collected £897,000,000, which was £94,000,000 more than the estimated yield. In that year, he recovered not only the reduction of £81,500,000, but also £12,500,000 to boot. That trend has been evident throughout the post-war years. It has been due to many factors, including, of course, inflation. Another f actor has. been, the vast industrial development, that took place during the war years, and which continued during the post-war period’. A third’ factor, of course, has been the great increase, of population, due to immigration. As we all know, immigration is gradually coming into credit instead of being a burden and a debit, as it necessarily was in the beginning. All of this proves my argument,, that the Government has at its disposal- revenues that are most flexible under present-day conditions. The people of this country are entitled to look for far greater taxation reductions than have been proposed. The Government has not addressed itself adequately to that problem, if at all.

In. this financial year, the Government doe9 not propose to finance States works programmes from Commonwealth revenue. At least, the Minister has stated that it does not intend to do so. The Government intends to allocate to the States what can be obtained from the loan market, but it does not display a great deal of confidence in what the loan market will yield. Recognizing that the States must have money for their works programmes, the Commonwealth has agreed to make advances to the States, at the rate of £180,000,000. per annum, in two half-yearly payments of £90,000,000.

Senator Hannaford:

– That is prudent.

Senator McKENNA:

– The Commonwealth is playing safe. I give the Government credit for helping the States in a practical manner until the loan market can be approached at what is deemed to be an opportune time, but I point out that it is not going to be easy to raise money in this financial year, in which loans aggregating £286,000,000 will mature. My guess: - and it is no better than a guess - is that the Commonwealth will have to make available to the States for their works programmes in this financial year as much as it has provided in the past. In this financial year we shall probably find that, as in the last financial year, the Treasurer’s estimates of revenue have been much understated, but that his estimates of expenditure will not be realized. In the last financial year, there was a surplus of £56,000,000, which is too great a margin of error for any Treasurer. I think it is quite possible that these will be a surplus, of the same order at the end of this financial year, which might well be applied towards assisting; the States, works programmes. I hope that I am wrong in my prediction about loan moneys, because I am genuinely eager to see. the loan market recover fully. I think that that would he good for everybody in this country

The Prime Minister (Mr. Menzies) recently told the people of this country that a select committee of this Parliament would be appointed to. consider the need for alterations of the Constitution. I would welcome, very warmly, the appointment of such a committee. However, to date we have heard nothing more of the proposal. Although I shall noi mention all of the constitutional problems with which I am concerned - or even the most important of them - there is one that is urgent. I refer to the need to synchronize the holding of elections for the Senate and the House of Representatives. This matter calls for the display of leadership by the Government. The Prime Minister indicated that this matter might be one of those to be considered by the committee that he envisaged. To date, however, as I have said, the committee has not been proposed, nor have we heard any more about it. I wonder whether the Minister for National Development (Senator Spooner) will, indue course, be good enough to tell us whether the Government intends to correct the present unsatisfactory position, by holding early coincident elections for each House? There are signs that that might happen, because he has embarked on a campaign of meeting the people - which is the usual precursor to an election - and the Minister for National Development attended the opening of an important establishment during last week-end. I should be glad if the Minister would, in his reply, say whether this “meeting the people “ campaign is the precursor to an early election involving both Houses of the Parliament:

Senator Henty:

– Does the Leader of the Opposition really believe that to be so?

Senator McKENNA:

– I think it quite likely. I should like the Minister to say something about that topic. I come now to the subject of social services, on which I do hot propose to dwell at length, because a measure to implement alterations to the social services legislation will soon be introduced into this chamber. I merely record the disappointment and the dismay of the Opposition that nothing of substance has been proposed in relation to our civil pensioners. No increase is proposed of age, invalid or widows’ pensions. I point out that the majority of such pensioners depend on their pensions of £3 10s. a week for food, clothing, amusement, and other necessities. I contend that the Government has been niggardly and heartless in its consideration of the plight of the 500,000 people in this category. It is for that reason the Opposition opposed the budget during the recent general debate on the Estimates and budget papers. When I was Minister for Social Services in the previous Labour Government, S5 per cent, of pensioners had no income apart from their pensions. Only 10 per cent, had 5s. a week or less in addition to the pension. Only 5 per cent, of all pensioners had an income, apart from the pension, of 5s. a week or more. I believe that these figures, which were published some years ago, are still substantially -true. If that is the position, 500,000 pensioners in this country are trying to live on £3 .10s. a week. An honorable senator has only to think for 30 seconds in order to realize the truth of my comment that the Government is mean, unthinking and lacking in human quality when it disregards the plight of these people.

The viewpoint of the Opposition in relation to benefits available under the Repatriation Act has already been expressed in the form of an amendment to the measure which was before the Senate. The Opposition approves of the Governments proposals in relation to the means test because the Opposition favours the complete abolition of the means test. The Government has only moved in this matter because of the announcement that the Leader of the Opposition in another place (Dr. Evatt) made when the budget was under consideration last year that a Labour government would abolish ohe means test in the life of a parliament, flint is to say. within three years. It was that announcement alone that forced the

Government to take the steps that it has now taken to ameliorate the means test.

Senator Scott:

– The honorable senator kids himself.

Senator McKENNA:

– The people who are doing the kidding are the Government senators. In 1949 they told the people of Australia that they would produce a plan to abolish the means test for the approval of the people at the general election of 1952. The Government grabbed at the excuse that there was no election in 1952. But there was one in 1953. There was also an election of the popular chamber in 1954, prior to which nothing was said about the abolition of the means test. So it is the Government that has kidded the people of Australia.

Senator Scott:

– There has been a substantial relaxation of the means test every year. The honorable senator knows that.

Senator McKENNA:

– Yes. I do know that. There were substantial relaxations of the means test under the Labour Government. But it was the Government of which the honorable senator is a supporter that promised that a plan for the abolition of the means test would be submitted to the people in 1952. Now, more than five years after the original promise was made, the Government proposes to ameliorate the means test. There has been no abolition, and no plan for the abolition of the means test.

The other matter upon which I want to comment is the statement of the Treasurer to the effect that 90,000 more people are now in civilian employment. That appears to be so from the figures that have just been released by the Commonwealth Statistician, but the fact remains that that figure is only 25,000 higher than the corresponding figure relating to the peak period of employment in June, 1951. When one remembers that at least 60,000 or S0,000 new people go into industry every year from the schools and from immigration one wonders where they have all gone. Why are there only 25,000 more people in civil employment now than there were in June, 195.1?

Senator Scott:

– Some are going out of industry.

Senator McKENNA:

– Of course. As far as can be ascertained, those going out of industry fall into two classes, married women and men over 40 years of age. The e is a growing tendency to discard people over 40 years of age. I have read many articles bearing some such heading as, “ Too Old at Forty “. Honorable senators will find that newspaper advertisements specify 40 years as the age limit for applicants for ordinary jobs. It is a tragedy that people who reach 65 years of age are being forced out of industry. Even some of those who are well under 65 have been forced out. A nian over 40 years of age who gets out of work finds it a matter of real difficulty to obtain another job. Industry is looking for youth and virility. Many people over 65 years of age should be usefully employed. It would be good for them and for the country, provided that conditions of employment were fully maintained.

The Opposition is opposed to the budget that has been presented for the reasons that I have outlined and which I shall now summarize. We consider that the budget fails to give adequate relief from taxation. It fails to make any real attack on the high cost structure. It applauds and supports an artificial and temporary stability which is based on the sacrifices of salary and wage earners. It fails to take account of hardships that are being suffered by civil and war pensioners and the family man. It is negative, unimaginative, unprogressive and unjust. For those reasons I propose, on behalf of the Opposition, to move a brief amendment to the motion for the first reading of this bill. I move-

That all words after “bill” lie left out with it view to insert in lieu thereof the following words: - “lie returned to the House of Representatives with a request that it be redrafted so as to better serve the interests of thu Australian people

Senator HENTY:
Tasmania

.- The Senate has listened with great interest to the speech of the Leader of the Opposition (Senator McKenna), an honorable senator whom we on this side of the chamber hold in very high regard, and to whom we always listen closely. During the course of the few remarks that I have to deliver on this subject, I want to deal with the subject of television, but I shall leave the majority of my remarks on that subject until later. At this stage.

I want to say that, as I listened to the Leader of the Opposition, I thought that it was just as well that the proceedings of the Senate were not being televised because the people who would have been watching their television sets would have seen just how far the honorable senator’s tongue was in his cheek. I have already said that Government senators have a high regard for the qualities of the Leader of the Opposition. However, during the course of his carool’ in this chamber there is one position that he has never held when his party has been in office. He has’ never held the position of Treasurer. After listening to his remarks on this budget I can well understand why’.

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

– He was adviser to the finest Treasurer that this country has ever had, the late Mr. Chifley.

Senator HENTY:

– Yes. I had a great regard for Mr. Chifley’s record at the Treasury and for his judgment in retaining for himself the position of Treasurer. He was a good judge.

I wish to survey some of the matters that have been raised by Senator McKenna. On many occasions previously, he has referred to the financing of capital works from revenue. That is the practice of this Government. The honorable senator has never advanced an alternative, although he has invariably attacked the Government on this matter. The Government has never called upon the Australian Loan Council for finance for Commonwealth capital works. They have been financed entirely from revenue. Previously, the honorable senator has denied that the Opposition would have expanded bank credit, or issued treasurynotes or that it would have printed notes to finance works had it been elected to the treasury bench. The honorable senator has stated that a- Labour government would have used central bank credit only to the amount of the labour and materials available. I should like to know what would have happened in such circumstances if the labour and materials available fell short of the extravagant promises that were presented by the Leader of the Opposition in the House of Representatives (Dr. Evatt) in the Australian Labour party’s auction sale policy at the last general election. The promises that were made by the Opposition called for more money than labour and material resources represented. That was one of the great mysteries of the Australian Labour party’s election campaign, and it was never explained. I feel sorry for the Leader of the Opposition in this chamber who was charged with the responsibility of endeavouring to provide an answer to the questions that were raised by the Australian Labour party’s policy. The fact that he was not able to do so during the election campaign explains why the- people of Australia were not prepared to trust the Opposition to occupy the treasury bench.

I direct the attention of honorable senators to the new policy that has been advanced by Senator McKenna. It is the new policy for the Australian Labour party and one of its main planks is the abolition of the means test in the provision of pensions. Fancy the Australian Labour party advocating pensions for the wealthy and the capitalists who have been condemned by Labour supporters consistently in the past. In the hope of gaining a few miserable votes at the last general election for the House of Representatives, the Australian Labour party was prepared to present the wealthy and the capitalists with an age pension at 65 years whether they had £1,000,000 or 2s. That was an interesting move to the right on the part of the Australian Labour party, and I should like an adequate explanation of how the proposal was to be financed. I know that there are many in the ranks of the Australian Labour party and its supporters who are not satisfied that the means test could bo abolished without an increase of taxes. Not all of them are in line on the new policy of the Australian Labour party. It is interesting to combine that proposal of the Opposition with the other plan of the Australian Labour party to make a 40 per cent, initial depreciation allowance ;i taxation concession.

The Australian Labour party combined in its policy the abolition of the means test, which meant pensions for millionaires, and an allowance of 40 per cent, for initial depreciation. Senator McKenna has stated that in allowing that concession, the Aus-

Senator Henty tralian Labour party proposed merely to defer the collection of the equivalent tax. It was merely -deferred and not a loss to the Government. If depreciation of machinery was to be deferred, it would be put off for a long time. In the case of motor cars, it would be, deferred for four or five years, and in the case of machinery of a capital nature, it might be deferred for ten or twenty years. Senator McKenna has not been able to explain adequately where he would get the money during the relevant period when the allowance for initial depreciation was in operation. Apparently the Opposition is still advocating the interesting financial policy that I have outlined, but no one can gauge the extent of the support for that policy that is forthcoming from the rank and file.

– Surely every honorable senator knows that there is no means of recognizing the initial subscriber to a bond. Bonds change hands many times. How is it possible to establish who was the initial subscriber? Under the present law, it cannot be done. Most; of the attack that has been launched upon this budget by the Opposition is without basis, but it has been cleverly directed to quantums of taxation with complete disregard for the national income. Taxpayers are interested principally in the amount of money that is left to them to spend. This Government has reduced rates of taxation nml has, in fact, abolished two taxes altogether. I hope that it will not end its term of office before it abolishes a third tax - the pay-roll tax. The claim of the Government that it has fulfilled its undertaking to reduce taxation has been fully upheld.

I turn now to the proposal to introduce television in Australia. . There is much work that I should like to see done in the Postal Department before it is given the duty of introducing and Administering television. My philosophy towards such proposals has always been simple. I have applied it often during my business career. I have known men in business who have been making money but not quite enough. They have approached me and suggested that if they could buy another business, they knew that they would be able to make sufficient money from two businesses to pay off their accumulated debts with something to spare. My answer has always been, in effect, “if you prove to me that you can run one business successfully, we will talk about running a second business “. That would be my answer to a suggestion that the PostmasterGeneral’s Department should conduct television in Australia. When the Postal Department proves that it is capable of running one business, let us examine the proposal that it should introduce television. There is a big lag in the provision of services that the people need, including telephones, and employees of the Australian Government throughout Australia are working in premises that would be condemned immediately by factory inspectors if they were used by private industry. While that state of affairs exists, we should not countenance the expenditure of millions of pounds by the Postal Department upon national television stations, but should use the money to provide telephones for the people and decent premises for Commonwealth public servants. I shall go further and say that if television is to be introduced into Australia, it could well be . left to private enterprise which, after all, did most of the pioneering and developmental work on wireless broadcasting in this country. I am certain that if the matter were left to private enterprise, television would not be limited to only two capital cities. Every State in the Commonwealth would have television. I am supported in that opinion by the fact that a considerable amount of national advertising would be done on television and national advertisers would want a coverage in every State of the Commonwealth. I say, therefore, that we should let the Postal Department do first the job that is its primary responsibility, and. leave television to private enterprise in the initial stages.

I propose now to say a few words about war service land settlement. As this matter is at present before the courts in Tasmania, I shall not go into the details of war service land settlement schemes in that State. I propose, however, to deal with the political side of the matter. The Tasmanian Labour Government has taken the view that certain writing-off has not been carried out because the Commonwealth will not agree to it. When soldier settlers throughout Tasmania ask why certain things that they were promised are not being done, invariably the Tasmanian Minister who is charged with the responsibility of administering war service land settlement says that the Commonwealth is to blame because it is not prepared to agree to a writing-off. In order that the blame may be laid where it should properly rest, I shall quote the relevant portions of the Commonwealth and the Tasmanian war service land settlement legislation. Section 3 (2) of the War Service Land Settlement Agreements Act provides that agreements with the agent States, which include Tasmania, may be made in accordance with the form contained in the second schedule to the act. Clause 4 (4) of that schedule states -

The Commonwealth shall make a capital contribution in respect of each holding of an amount equal to three-fifths of the excess of the total cost involved in acquiring, developing and improving the holding over the sum of valuations of the land and improvements.

Clause 7 provides -

In making the valuations, the officers shall have regard to the need for the proceeds of the holding (based on conservative estimates over a long-term period of prices and yields for products) being sufficient to provide a reasonable living for the settler after meeting such financial commitments as would be incurred by a settler possessing no capital.

In other words, under this legislation the Commonwealth has agreed to write-off three-fifths of the valuation of a holding in excess of the figure which is regarded as reasonable to enable the soldier settler to obtain a proper living. Clause 9 then states -

The Commonwealth shall bear any losses arising out of arrangements made in accordance with clause 15 of this agreement.

Clause 15 states -

1 ) The Commonwealth, in consultation with the State, will arrange with an authority in that State to make advances to settlers, upon such conditions as may be agreed upon between the Commonwealth and the State, for the purpose of providing working capital and paying for and effecting improvements and acquiring stock, plant and equipment.

The Commonwealth’s responsibilities under that agreement are clear. The Commonwealth has agreed to write-off three-fifths of the excess over a reasonable valuation. But in the Tasmanian War Service Land Settlement Act of 1950, the Government of that State has gone far beyond that. It has given an undertaking to ex-servicemen, on its own behalf. Section 14 (2) of that act provides that the Closer Settlement Board of Tasmania, in offering a holding to an eligible person, shall specify - (/) The capital cost to the Board of the holding at the time of allotment, excluding the amount payable for improvements under section twentysix.

Therefore, the State is committed under its own legislation to the capital cost of a holding to the board at the time of allotment. The position that arises is this : The Commonwealth says “ Here is a property which costs £10,000. In our opinion £8,000 is a reasonable value if the settler is to make a reasonable living”. That means that £2,000 must be written-off. The Commonwealth is committed to provide three-fifths of that sum and the remaining two-fifths is the responsibility of the State. But the State, under its own legislation, may say that the 1946 value of the holdingwas £5,000. The Commonwealth is not prepared to provide three-fifths of £5,000 because it has undertaken no such commitment. It is committed to only three-fifths of £2,000 and the balance is a responsibility of the State. I object to this political use of the agreement by the State Government. As I have said, the State authorities claim that the Commonwealth is not prepared to do the necessary writing off. I shall not. mention, any specific values. The figures that I have used are purely hypothetical because this matter is the subject of court action. I merely draw attention to the fact that the provisions to which I have referred are being used wrongly by State governments for political purposes.

Housing is a matter of considerable interest to all honorable senators, and I should like to draw attention to a successful experiment in housing that has been undertaken overseas. I think it is admitted that Germany has rehoused its people to better effect than any other country and 1 note with some interest the assistance that has been given by the Adenauer Government of Germany. It has allowed industry complete freedom from tax on any profits invested in housing. This concession has been of great assistance to industry as well as to the rehousing of the German people. It seems that we have a lot to learn from practical measures that are being taken in other countries to solve the housing problem. Another interesting and successful housing experiment is being carried out in Tasmania. It has been undertaken by one of the most enlightened private enterprises in the Commonwealth. I refer to Associated Pulp and Paper Mills Limited at Burnie. That organization has introduced a scheme under which its employees can purchase their homes for reasonable fortnightly repayments covering capital charges and interest at 44 per cent. If an occupier wishes to purchase his house over a tenyear period, the fortnightly instalment is 9s. 7d. per £100. Over fifteen years the fortnightly payment is 7s. Id. per £100, and over twenty years it is 5s. lOd. If a house is to be purchased over a 25- year period, the repayment is as low as 5s. 2d. a fortnight per £100. This means a weekly commitment of £2 lis. Sd. on a loan of £2,000. The scheme is, of course, subsidized to a degree by the industry itself because the provision of housing is conducive to long service by employees. The scheme is very sound and practical and represents a valuable contribution to the solution of the problem of housing. I commend it to the attention of the Government. Many details are worthy of study by any other organization that may wish to undertake a similar scheme.

The only other matter to which I propose to refer to-day is a subject about which members of this chamber hear regularly from Tasmanian representatives. I refer to shipping. Most honorable senators tend to forget, unless the facts are brought constantly to their notice, that shipping presents a great problem to Tasmania. The extent cif the problem is revealed by the fact that for every ton of goods per head of population moved by ship for the people of the other States, five tons per head of population is moved by ship for the people of Tasmania. Consequently, the burden of shipping freights presses five times more heavily on the Tasmanian people than on the people of the other States. Other States have fairly large internal markets for the goods that they produce, and they can send their surplus products to neighbouring States by road and rail as well as by sea; but Tasmania, owing to its small population, has a very limited interna market, and the bulk of its products is sent to other States by sea. I am confident that the Government has never fully dealt with the factors that have caused freight rates to rise to their present level. It has been pointed out on many occasions, both inside and outside the Parliament, that the only war-time control still in existence relates to the shipping industry. I refer to the Australian Stevedoring Industry Board. I feel that the board has ceased to perform the functions for which it was established, and has outlived its usefulness. I do not think any Tasmanian senator will disagree with that statement.

Senator Robertson:

– Neither will any senator from Western Australia.

Senator HENTY:

– Certainly honorable senators from Tasmania and Western Australia will agree that the board has outlived its usefulness. I was greatly heartened the other day by a statement in the press to the effect that the Government intends to review the whole of the operations of the board. I think such a review is long overdue. The sooner it is carried out, the better it will be for Australia. To satisfy Tasmanians, it must bc done promptly. Until I know what the Government proposes to do about the functions of the board, I shall reserve my opinion on whether it should be abolished. At present, I feel that the abolition of the board would be in the best interests of Australia, but before I pass judgment finally I shall wait to see what the Government proposes to do. I urge the Government to deal with the matter promptly. In my opinion, the board, which stands between employers and employees on the waterfront, has aggravated industrial disputes on many occasions, and is one of the causes of the increased cost of handling goods on Australian wharfs.

I congratulate the Government on the reductions of taxation it has made since 1949. It has reduced the rate of taxation by 30 per cent. I congratulate it on having done something that has astonished most of the people of Australia. In the past, we have been prone to say, with some justice, that once the Commonwealth imposed a tax, we could never get rid of that tax. But this Government has relieved us of two taxes, the federal land tax, which honorable senators opposite say they will re-impose if the Labour party regains office; and the federal entertainments tax. I hope the pay-roll tax will be the next tax to be abolished, because it is forcing municipal councils to levy increased rates. Recently, I made a survey of the effect of the operation of the pay-roll tax on local-governing bodies in Tasmania. I discovered that, in order to cover the pay-roll tax alone, municipal councils in country districts have to levy a rate of between id. and f d. in the £1, and, in some instances, Id. in the £1. In the city areas, an additional rate of 3d. in the £1 has to be levied by city councils to cover the pay-roll tax. The land tax and the entertainments tax have been abolished. I trust the payroll tax will soon join them.

Senator O’BYRNE:
Tasmania

– Senator Henty’s attempt to answer the penetrating and telling criticisms levelled at the -budget by the Leader of the Opposition (Senator McKenna) was a very poor effort. Senator McKenna has made the charge, which has not been answered so far, that the budget is a reflection of the downward trend of our economy and its drift towards instability since this Government took office. Let us compare our economic position to-day with the position when the Government came into power. Our primary producers, who have been encouraged through the years to increase their production, are facing a crisis. They do not know how to solve the problems that confront them. The budget does not show any of the people engaged in our primary industries how they will be able to dispose of their surplus products. The poultry-breeders, pigmeat producers and berry fruit producers of Tasmania are encountering extreme difficulty at present in finding overseas markets for their products, and their prospects for the future appear to be very gloomy indeed. The budget gives no lead to our primary industries. It can be described only as a makeshift budget produced by a government that is trying to hold the fort while it waits for something to turn up to get it out of its difficulties.

Senator Henty referred to Senator McKenna’s ministerial experience. I remind Senator Henty that between 1943 and 1946 - a critical period for Australia - and also during the very difficult postwar transitional period, Senator McKenna was the right hand man in the Treasury of the late Mr. Chifley. In view of the experience that Senator McKenna has had of an economy which, although composed of explosive elements, . was kept very stable, he has not only good reason to criticize this budget, but also the knowledge necessary to enable him to do so.

Honorable senators opposite have criticized the promise made by the Australian Labour party during the last general election that, if returned, it would abolish the means test. A very weak argument advanced by Government senators is that if the means test were abolished, millionaires would become entitled to pensions. The only question to be considered is whether we could finance a scheme under which everybody would be entitled to a pension. “We claim that people who, during their working lives, have contributed to the National Welfare Fund by the payment of taxes or social services contributions, should be entitled, whatever their incomes may be, to an annuity when they are no longer able to follow their callings. I have never heard Government senators suggest that, child endowment or the maternity allowance , should not be paid to very wealthypeople. The children of wealthy people are as much entitled to child endowment as are the children of poor people. We believe that the Government should pay an annuity to all people, regardless of their financial position, when they reach an age at which they are no longer able to follow their callings. At that time of their lives, they should have some basic security. The age pension, if paid to everybody of the appropriate age, would provide all retired people with . a minimum measure of security, regardless of their incomes and of how the winds of fate blew against them. It is with that idea in mind that, through the years, the Labour movement has made the abolition of the means test one of its objectives. As soon as practicable, we shall introduce legislation progressively to abolish the means test.’

Senator Wedgwood:

– That is what the Government is doing now.

Senator O’BYRNE:

– We put before the people of Australia a time limit for the abolition of the means test. The illconceived national insurance scheme proposed by Mr. Casey in 1939 would have imposed an unjust burden on the people in the community who were least able to bear it. But the plan that Labour has put forward to the people of this country is based on the ability of people to pay. Its foundation is a national welfare fund to which people will contribute by way of income tax or social services contributions. Continual harping, for the purpose of political gain, on the fact that the Australian Labour party did not introduce a national superannuation scheme has the effect of dragging a red herring across the trail, and it confuses the electors.

Senator Henty also discussed the desirability of permitting people to pay income tax by means of bonds. This Government deserves the censure of the people for having allowed the value of bonds to depreciate so greatly. Interference with the interest rate has caused a great’ decline in the value of bonds. People who invested in good faith, at a time when Australia needed such money, now find that the value of their investment has depreciated byas much as 18 per cent. That depreciation has occurred during the life of this Government and is a reflection on the sense of justice of the Government. It is quite wrong that people who contributed their savings to assist the war by the purchase of Commonwealth bonds at a set rate of interest, should find that the cash value of their investment is so much less than it should be. During the recent general election campaign, the Australian Labour party declared that, if elected to office, it would see that such investors received basic justice.

Television was also referred to by Senator Henty. He advocated that it be left to private enterprise. I suggest that, if that were done, the prices of commodities advertised during television programmes would rise and thus increase the rate of inflation. I remind the honorable senator that the cost of television productions is so great that the sponsors are obliged to increase the retail cost of the commodities they advertise. ‘

Senator Wedgwood:

– Competition would keep prices down.

Senator O’BYRNE:

– I suggest that it would not do so, for the simple reason that some manufacturers would obtain a monopoly of the advertising time. In the United States of America, the cost of producing television programmes is at the rate of £A.50,000 an hour. Such a huge expense would have to be added to the cost of the commodities that were being advertised. In my opinion, it would be a retrograde step if private enterprise were given the whole field of television. I favour careful sponsorship, during the early stages, by officers and technicians of the Postmaster-General’s Department, in order to ensure that the Australian people receive television of the highest quality. If possible, colour television should be provided initially, so that the experience of people in overseas countries who pur-‘ chased sets for black and white television, and were then obliged to have them modified for colour television, will not be repeated in Australia. The Australian Broadcasting Commission tries to provide suitable entertainment for the listening public. If television were controlled by a government instrumentality, I believe that a high standard would be set, which would be beneficial for the Australian people generally. The Australian Broadcasting Commission provides alternative programmes, so that listeners may tune in to the programme of their choice. They are not obliged to listen to the screeching voices of announcers who try to sell the products they advertise by claiming that they are better than similar products whereas, in fact, they are a great deal worse. The technique of advertising is that, if the advertiser can tell the people often enough and loudly enough that his product is the best, the people will believe him and buy his product. I consider that advertising on the radio is an imposition, and I hope that a similar imposition will not be made when television is introduced.

As Senator Henty has stated, shipping difficulties constitute a continual problem for the people of Tasmania. Every Tasmanian has, in the forefront of his mind, the knowledge that that problem must be tackled if the goods which his State produces are to be” marketed on the mainland and overseas on a successful basis, and if the products which Tasmania does not produce are to be imported economically. Almost always when a shipping problem has arisen in Tasmania, the Tasmanian members of the Senate have approached the Minister for Shipping and Transport (Senator McLeay) with the request that the Government take action. In my opinion, the private shipping companies have failed Tasmania because they have not accepted full responsibility to provide an adequate shipping service. Their failure is the basic cause of Tasmania’s shipping problems. Despite the fact that those shipping companies have been provided with every facility they have allowed cargo to accumulate in the open and have not handled it in an orderly fashion. It seems to me that such shipping companies do not merit the confidence which this Government has reposed in them. The Government should consider the possibility of expanding the Commonwealth shipping line so that the Tasmanian people may be assured that the transport of goods to and from Tasmania will not be a matter of pure profit seeking but a national responsibility. Tasmania is entitled to a reliable and regular shipping service, such as other parts of the Commonwealth enjoy. The mainland States have road and rail systems as alternatives to shipping services. We in Tasmania have no such contact with the mainland. For that reason it is essential that we have a regular and efficient shipping service. I point out that Tasmania’s disability in that regard was con- sidered at the time of federation. The cost of providing such a service should not act as a deterrent. Losses incurred by railways in, say South Australia or Western Australia, are met from Consolidated Revenue because, it is said, such railways are necessary for the proper development of Australia. While I agree that that is so, it seems to mp that the same reasoning should apply to the provision of adequate shipping services to Tasmania.

Recently an article appeared in the Canberra Times concerning the lack of interest in the development of the national capital and the need for members of the Parliament, regardless of the part of the Commonwealth from which they come, to take the development of the capital to heart. As honorable senators are no doubt aware, there has been a tendency to alter the original plan of Canberra by means of regulations. I understand that although the plan provided for a system of lakes, it ‘ha3 been decided not to proceed with the east lake. A decision has yet to be made concerning the west lake, which would be practically in the centre of Canberra. At the present time, the area is occupied by a race-course and a golf course, and whilst I am not opposed to the provision of such facilities, I should like to see the race-course used for the purposes of the Australian National University.

Just recently a contract was let for the building of the John Curtin School of Medical Science. The original plan to provide a west lake should have been retained. Indeed, it was believed that the site of the Australian National University would ultimately become an isthmus, and the university, when established, would not be subject to distractions. I point- out that if the racecourse is permitted to remain in its present position it might eventually be used for dog-racing, motor cycleracing, or other noisy activities, which would not enhance the aesthetic setting of the national university. From the point of view, of impressions gained by overseas visitors, it is undesirable for a race track to be located alongside the university. Furthermore, it must be remembered that, as time goes on, extensive car-parking facilities will have to be provided for sports patrons.

The original Canberra plan also made provision for a central lake. At present, there does not exist in the National Capital a wide expanse of water, on which the residents could engage in water sports during the summer months. The flow of the Molonglo River dwindles to a trickle in summer. I believe that the lakes scheme envisaged by the Canberra plan was commendable. As the east lake portion of the scheme has been abandoned, I urge the Government, before it is too late, to ensure that the west lake proposal shall be implemented.

– Before the suspension of the sitting I was speaking of the unrest which existed below the surface of the whole trade union movement in Australia in relation to margins for skilled tradesmen and the pegging of the basic wage through the discontinuation of the cost-of-living adjustments. The Commonwealth Court of Conciliation and Arbitration, which has brought about industrial peace in the past, could be seriously threatened as an institution unless some consideration is given to the very strong claim that i3 being put forward by the representatives of the industrial movement, and on which strong opinions are held by the individual members of trade unions. It is because of the disregard of those strong claims that, under the surface, there is grave resentment. People are being deprived of what should be justly theirs.

Another matter that I want to discuss concerns Australian foreign policy. I was” very perturbed to read a recent report of a new departure in Australian foreign policy with regard to our near neighbours. I refer to the opposition by the Australian representatives at the United Nations organization to the application by Indonesia being heard before the United Nations organization. Australia’s position is that of an outpost of Asia. The term. “Ear East”, as this part of the world was once called in textbooks, conveys a false impression. The situation has changed. Our near north neighbours are all Asian people and instead of antagonizing them we should, at least, be following a line of compromise. We should ascertain whether we cannot see our way clear to form friendships with these people. The history of colonialism throughout Asia resembles the history of Dutch rule in Indonesia. I understand that the Dutch did not leave very much behind in Indonesia for the native people to be grateful for. The present Indonesian Government has extreme influences within it but, at least, it is trying in its own way to institute some basis of democracy where that basis did not previously exist. In opposing the application of the Indonesian Government for its case to be heard in the United Nations organization where points of view can be exchanged, the Government is distorting the view of the Australian people. I believe that the Australian people are overwhelmingly against the opposition of the Minister for External Affairs (Mr. Casey) to the Indonesian case being heard in the United Nations organization. Australia is supposed to be an advanced democracy. The Indonesian Government is a member of the United Nations organization and should have its case heard by that body.

Senator MARRIOTT:
TASMANIA · LP

– Why?

Senator O’BYRNE:

– Because there is no other instrumentality to which it can appeal. The forces of colonialism which are trying to maintain the status quo throughout Asia are such that Indonesia is being squeezed out of the United Nations organization. These forces cannot put the mark of communism on the Indonesian people because^ although there is a strong Communist influence in Indonesia, the Government is not Communist. It is anti-Communist. The policy of the Australian Government will tend to discredit the Indonesian Government and throw the Indonesian people into the hands of the Communists. The Government has been very wrong in opposing the hearing before the United Nations organization of a matter which is of great importance to the Indonesian people and to the Australian people because Australia has to administer Papua and New Guinea. The area which is under disput is adjacent to Indonesia, and the Australian Government should avoid being at loggerheads with the Indonesian Government. For that reason, every effort should be made to find some level of compromise and to make friends of the Indonesian people rather than openly flout their wishes by opposing the application for their case to be brought into the full searchlight of the United Nations forum.

To-day, the Argus published a state- ment by the Director-General of Army Medical Services, Major-General Kingsley Norris, commenting on the effect of the atomic bomb. He said that the effects of the atom bomb had not been as great as had been expected and that, with modern protective measures, loss of life and damage to property could be minimized. He said that he attended the Commission of Inquiry, which was held concerning the atom bomb that was dropped on Hiroshima, and was able to get first-hand information there. He said that the atom bomb. was now a conventional weapon of war and that he would expect it to be used in another war. The fact that the Director-General of Army Medical Services is preparing the ground for people to expect atom bombs to be dropped indicates that the outlook of our Army chiefs, as well as the foreign policy of the Government, has reached a very sorry pass. Major-General Kingsley Norris said that the immediate effects of the terrific heat and tremendous blast of the atom bomb are horrible but that the suspected long-range effects of radioaction had not proved as serious as had been expected. From what I have seen of the effects of the ordinary T.N.T. bombs, and from what I have heard of the small bomb that was dropped on Hiroshima and Nagasaki, the potentialities of the hydrogen bomb and of the larger atom bombs are too terrible to contemplate. It appeared that the report that was published in the press to-day was designed to prepare people to expect the dropping of atom bombs. I deplore the publication of this report very much indeed.

With the friction that exists in parts of the world in close proximity to our country, with the rising tension of a clash of arms on the Chinese coast and the island of Quemoy, it appears as though we are being carefully conditioned to accept a really hot war in the near future. The Chinese people cannot see any great hope of their being recognized in the United Nations organization. The American Chiefs of Staff seem to be preparing to undertake hostilities alone. What has happened off the Chinese coast very nearly amounts to provocation and could have serious consequences for the whole world by starting another world war. If the island of Quemoy, which is off the Chinese coast, is to be a base for an invasion, and if the ports along the Chinese coast, which are sheltering invasion barges, have been attacked from Formosa, then the next step would be the dropping of atom bombs. That state of affairs must appal every decent, thinking person in the world. The terrifying possibility of a clash of arms in which hydrogen bombs would be used should make every responsible person on. the diplomatic level do his utmost to avoid such a catastrophe. Yet Major-General Kingsley Norris and Government spokesmen have spoken of the practical inevitability of a future war. Each week the tempo becomes faster. We are fed with fresh information that is designed to make us more accustomed to the possibility of war. I deplore that tendency. I believe that we are not receiving as much information as we should about events in the field of diplomacy and where our policy is leading us. Instead of following the policy to which Australia is pledged as a member of the United Nations organization, the Government has approved the exclusion of nations who wish to become members of that body. That is a negative policy, and the people of Australia should be told exactly, where we are heading.

We are reaching a stage where there does hot seem to be any room for a policy of co-existence. Apparently the diplomatic world is resigned to the belief that no compromise is possible, and that the only way to solve the ideological problem is to smash the heads of those who believe in other ideologies. We and our allies propose to do that, not in a primitive way, but with the most terrible weapons that man has been able to devise. People in this country and throughout the world are being conditioned to accept an atomic war when it comes. Indications are that it will take place on the mainland of China, to the disadvantage of the peoples of Asia and the interests of Australia. In the past few years, the people of India, Ceylon and Indonesia, who are among our near neighbours, have been given no encouragement by the foreign policy of this Government to be friendly towards us. We shall be in a position of terrible isolation on the fringe of Asia if we adhere to the policy that has been applied by this Government in the past few years. I have in my hand a copy of an article that was published in the Melbourne Argus and was written by Mr. Richard Crossman, a member of the British Parliament. It is headed “ U.S.A. is Scared to Make Peace”. Iri this article Mr. Crossman stated -

I have had frank, informal talks with top level policy makers including Admiral Radford, Chairman of the U.S. Joint Chiefs of Staff, an alleged exponent of preventive war, and with Admiral Strauss, who controls the production of the H bomb.

Here is the picture which emerges:

What Americans feel really excited about is Communist China. Europe is a long way off. But Mao is the Red enemy on America’s back door.

How to deal with that enemy V

After a phase of desperately dangerous lunging and lurching, the United States is steadying up.

Since last April when Admiral Radford urged intervention in Indo-China, the war party here has suffered a series of reverses. But that party is still entrenched in key positions.

The preventive warriors believe, like General MacArthur, that war with Communist China is inevitable in the long run. They believe it would be fatal to wait until Mao has built up his .armed forces. In the Pentagon - the Defence H.Q. here in Washington - I heard it said that the only sane military policy is to pull up the Chinese Communists dead by dropping tactical atomic bombs on them - at Quemoy or anywhere else where they threaten.

I have quoted from that article because Australia is vitally affected by the policy of the nations towards Asia, whether that policy flows from the United States of America or the United Nations! The conditioning process to which I have referred is designed to make the Australian people believe that war is inevitable. It is a negative and destructive policy, and can bring only danger and suffering to the people of this nation. In the present clash of rival ideologies, the most fertile field for the spread of communism appears to be in the Asian countries. Australia is a member of the United Nations organization, and one of the important articles of its Charter is to assist undeveloped countries. The Charter is opposed to colonialism in any form. It is designed to assist countries that have poor standards of living. If we continue to disregard the countries that have genuine claims to assistance, and if we exclude or fail to recognize countries such as India, Burma, Ceylon and Indonesia, any pacts for mutual assistance in the defence of Asia must fail. Whether there is a war or not, we shall be left with a legacy of distrust and hatred against us that may last for many generations. I wish to place on record my opposition to the Government’s policy of disregarding those important neighbours of ours to the north of Australia.

Senator McCallum:

– We have not disregarded them.

Senator O’BYRNE:

– We have done so in at least one respect. We have been prepared to by-pass them because they have no big armies or armaments. They are not strong in a military sense. The tendency to-day appears to be to get friendly with the strong, and hang on to the coat tails of the man with the biggest stick. That might be expedient, but I am certain that, in the long-run, future generations of Australians will inherit the distrust of our neighbours. Long after this Government has ceased to be in power, Australia will still exist and we shall retain it, but the people in the countries to the north will have attained the ful] status of democracy, and they will still distrust us because the policy of this Government is against their interests. Geographically, we are part of Asia. Unless this Government adopts a different approach to our near neighbours in the north, beginning with its attitude to the disputed territory of Dutch New Guinea, Australia will suffer.

There. is no reason why we cannot coexist with the Chinese people. The Chinese have seen past civilizations come and go, and they may see the beginning and the end of future civilizations. The policy of this Government indicates that it believes we can offer open insults to our neighbours. I object strongly to that policy. I believe that such an attitude is damaging, not only to Australians of this generation, but .to generations to come. I appeal to the Government to try to widen its outlook. Australia has built up a reputation in the United Nations organization as a sponsor of the smaller nations. We have no reason to antagonize the peoples of the countries that I have mentioned. We are just emerging from the embryo stage ourselves. The nations of the world that are strongest to-day have gone through revolutionary stages. The democracy of the United States of America was the result of a revolution. That statement can be applied also to France and to Germany. History does not stand still. The upheavals that are taking place in various parts of Asia are the natural results of a long period of suppression. The ordinary peasants have been deprived of land from which they could produce food and develop natural resources. In justice, we should give those people the opportunity to determine for themselves their own internal policy, just as we claim that right for ourselves. They should have the rights that are set out in the United Nations Charter of self-determination, access to raw materials, and trade with other countries. If we follow out the principles upon which the United Nations’ organization was founded, we shall find that, instead of building up antagonisms among our near neighbours, we shall build a friendship that will last and be of benefit to Australia and to countries in the near north and in Asia.

Senator PALTRIDGE:
Western Australia

– Ever since the Government established a Foreign Affairs Committee, about three years ago, there has been an open invitation to members of the Opposition in the Parliament to join that committee. For reasons of its own the Labour Party has, from time to time, rejected that invitation. But whatever those reasons are, and however valid they may have been in the past, I suggest that, to-night the Opposition has been provided with a final and compelling reason whyit should appoint representatives to the committee. If Senator O’Byrne thinks for one minute that Australian public opinion on the question of north-west New Guinea runs along the lines he has described to-night, I suggest that he could best put himself right by calling a public meeting in his home town of Launceston, and getting the citizens of that town to tell him just what they think about the matter.

The Opposition’s contribution to the 1954-55 budget debate will not be noted in our political history as a fierce attack, a spirited attack, or even a lively attack, on the Government’s financial proposals. Indeed, from my reading of Hansard, and from my rather brief experience as a member of this chamber, I should hazard a guess that never before in the history of federation has an Opposition of any political party- launched such a weak, insipid, lifeless, and dispirited attack on an important occasion such as this. The only thing that can be said about it is that it has been characterized by some most unusual features in both form and substance. Last week, when the motion foi1 the printing of the Estimates and budget papers was before the Senate, the Leader of the Opposition (Senator McKenna). possibly influenced by what had happened elsewhere, declined to lead his party, although it is true that, later in the debate, and with obvious reluctance, he did speak to the motion. He was rather like that Gilbertian character, the Duke of Plaza Toro, who led his forces from behind. The honorable senator said on that occasion that, when the Appropriation Bill came before the Senate, lie would lead the debate and we have seen him to-day in all his resurgent might as a leader. I venture to say that it was the most disappointing speech that we on this side of the chamber, and even those who sit behind the Leader of the Opposition himself, have ever heard delivered by him. He completely failed, as he did last week, to address himself to the major issues with which any budget must confront a Parliament. Yet, only a few months ago the honorable senator was loud in his attack on the Government. Only last May he denounced the general financial and economic policy of the Government as a policy that must spell disaster. He carried that cry to the public. He told the electors that if the Menzies Government were returned to office, there would be a continuance of the disastrous administration that they had already experienced.

There is another important question to which he might have addressed himself to-day because he had a good deal to say about it in the past. I refer to employment and unemployment. How frequently have we been obliged to sit here and listen to his dreary prognostications about what is going to happen to the employment position in Australia? We have heard him speak frequently also about the disastrous results that must follow this Government’s developmental policy. But those subjects, which hitherto have been of first-class importance to him, were forgotten to-day as they were forgotten last week. It is fair to ask why. Does his silence indicate that, at last, even he and his colleagues have been convinced that their erstwhile criticism has been utterly false and baseless; that they have gone to the people time and time again with proposals that have been subsequently shown to be wrong; and that from their places in this chamber and the House of Representatives they have advocated policies which the course of events has proved to be abundantly wrong? Was that why he did address himself to those other matters? The honorable senator was certainly more concerned with returning to a discourse on the elections. Although he said last week that he did not want to rake over the ashes of the election campaign - I think that was his expression - like a moth attracted by the embers, he immediately went back to the elections, not knowing that again he would have his wings well and truly singed as they were singed this afternoon by Senator Henty. In a discussion of the cost of Labour’s election proposals in which he attempted to prove that the estimate made by Treasury officials of £372,000,000, was completely wrong, he certainly introduced some fantastic material.

Senator Hannaford:

– Very novel, too.

Senator PALTRIDGE:

– Yes. Senator Henty this afternoon drew attention to Labour’s quaint - that is the only word that can be used to describe it - idea about depreciation and its effect on taxation. Even a fourteen-year-old student must know that if the collection of a tax is deferred even from one year to the next, the necessity to collect the tax for the current year still remains. Then the Leader of the Opposition advanced a little and took in the important subject of war service homes. He said that the Prime Minister (Mr. Menzies) had most improperly included increased expenditure on war service homes in his estimate of the annual cost of Labour’s election proposals, whereas such expenditure was outside the budget. ‘ But if the honorable senator will examine the budget papers, he will finds that finance for war service homes has been appropriated from revenue for at least the past four years. That has been done because loan funds, which are the usual source of this finance, have been allocated _ to States. The fact that war service homes finance is provided from revenue completely removes the validity of the honorable senator’s argument that it is outside the budget proper. It is well inside the budget proper, and I am sure that the Leader of the Opposition knows that better than most of his supporters do. I deny, too, that expenditure on war service homes is immediately reproductive as the honorable senator would have us believe. I invite him to examine his accounts again. Such expenditure is not 33 per cent, reproductive. Yet that is the kind of argument that is used in this chamber in an attempt to disprove a statement made on the highest possible Treasury authority!

The Leader of the Opposition also suggested that the Commonwealth Bank might provide finance for war service homes. He said that was a proper function of the Commonwealth Bank. I should be almost inclined to agree with him if I did not suspect his financial methods. Does the honorable senator mean that the Commonwealth Bank would advance money for war service homes by normal trading methods or that the bank, under a Labour government, would be empowered to create money? The creation of bank credit is an interesting matter. The Leader of the Opposition advocated a policy of creating bank credit to the extent of available finance and resources as good policy, and as a justification for that policy, he said that even the Menzies Government had adopted it. It is true that the Menzies Government issued bank credit. Each year, when that course was adopted, the Menzies Government announced what it was doing and the extent to which bank credit had been issued, and for what purpose. It was not done as a matter of general policy. It was done as a temporary palliative in order not to impose too great a brake on the economy and thus cause immediate unemployment. It was done sparingly and with discretion. It was done until last year, when the point had been reached where further bank credit was not necessary. We were able to retire no less than £35,000,000. worth of treasury-bills and thus confer upon the community the benefits of stability that flow from that retirement of treasury-bills. Yet this swash-buckling financier now says, as a matter of policy, “Let us take the lid off again and issue treasury-bills ad lib “. I suggest that such a policy is completely and utterly irresponsible.

There are one or two other significant features of the honorable senator’s speech. The first was the adroit way he flirted with the problem of the abolition of the means test. Just as remarkable, of course, was his lack of inclination to make any assessment of what Labour’s election promises would have cost. But let me speak first of the manner in which the Leader of the Opposition flirted with the abolition of the means test. I put it to the honorable senator that, whatever division of opinion may exist behind him, he, as Leader of the Opposition in this chamber, should make his own position clear, because ‘surely it is obvious now that the official policy of the Labour party, the policy in which Dr, Evatt believes, is the abolition of the means test. Are we to believe that the Leader of the Opposition in this chamber is not in line with his party leader on this question? Does he believe, as the honorable member for Fawkner believes, that it would not be desirable to put this policy into practice? Does he accept the view of the honorable member for Fawkner? That honorable member said -

It has only une thing to commend it - winning a few votes as a short-term political expedient. But it would be done at a terrible cost. It would be a calamity which might well wreck our social services structure.

I suggest that the Leader of the Opposition has a responsibility to the Senate and the people to state what he believes to be right in this connexion. Senator Kennelly has some views on this matter, and he has been courageous enough to state them. He was reported to have said in Melbourne some time ago - I remember reading that the report had not been denied or contradicted - that he had no objection to abolishing the means test if he could be shown how it could be done without increasing taxation or risking inflation. I suggest that the Leader of the Opposition should state where he stands on these matters, so that we can know what the official attitude of the Labour party is.

I turn to the failure of the Leader of the Opposition to give an estimate of the cost of Labour’s promises, despite the fact that he averred continually that one figure quoted was completely wrong. If it was completely wrong, and if, by a process of examination, he had found it to be completely wrong, he must have discovered for himself what the cost of the promises would be, but he declined to make any reference to that figure. When he was pressed to do so by Senator Spooner by way of interjection, he said he could not state the cost with any precision, but subsequently, in answer to another interjection, he said that it would be considerably less than a half of £372,000,000. At that point, I thought we were getting somewhere.

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

Senator Byrne interjecting,

Senator PALTRIDGE:

– He was referring to the total cost of Labour’s. promises and to the amount of central bank credit that would be involved. A half of £372,000,000 is £186,000,000. Giving Senator McKenna credit for whatever he may consider to be considerably less than a half of £372,000,000, his estimate lies somewhere between £100,000,000 and £150,000,000. That brings us to a very interesting point. Dr. Evatt said, or the official advertisements of the Labour party said - I presume that at that time the schism was not so great that what Dr. Evatt said was not synonymous with what the official advertisements said - that the abolition of the means test could be achieved without increased taxation and without inflation. Senator McKenna put the cost of Labour’s promise at between £100,000,000 and £150,000,000. During the course of the election campaign, Mr. Calwell said that the estimate of £372,000,000 was completely wrong, that he had worked out the cost and found that it would be no more than £200,000,000. Underlying all these estimates, there is the statement by the late Mr. Chifley that the means test could not be abolished without resort to central bank credit or extra taxation.

During an election campaign, it is the prerogative or the privilege of any political party to go before the people, present its policy and make its promises. It does not matter if those promises are extravagant to the point of absurdity. A political party has a perfect right to present its policy to the people, but it is also under an obligation, when challenged to say what its policy will cost, to state the cost without equivocation or hesitation. The Labour party failed dismally to discharge that obligation during the course of the last election campaign. Months after the campaign, its Leader in the Senate has told us that he is unable to state what the cost of his party’s -promises would be. I suggest that that approach to this question is one of complete political irresponsibility and political unscrupulousness. The duty of the Labour party at any future election will be to say what its promises will cost. “Whatever may have been the attractions of Labour’s promises at the last election, I believe the inherent honesty of the Australian electors rebelled against a party which could not say what its promises would cost.

The Leader of the Opposition had something to say about oil companies. Unfortunately, time prevented him from concluding his remarks. I always listen with a good deal of interest to remarks emanating from the Labour party oh the oil industry. I believe with Senator McKenna that oil is the life-blood of any economy, and that its discovery, production and refining should be encouraged. I believe that no economy can do without oil, and that the greatest possible encouragement should be given to the establishment of an efficient oil industry in this country. I should say that one of the first duties of- any Australian Government would be to try to establish an oil industry here. But, looking over the record of the Labour party in this connexion, we find, not only that Labour did not encourage the establishment of an Australian oil industry, but also that its approach to the problem was such that it actually prevented the establishment of an oil industry in this country. In January of this year, the managing director of Ampol Petroleum .Limited made this statement -

The nationalization policy of the Australian Government seven years ago delayed the discovery of oil in Australia. In 194(1 we did not have the amount of risk money or the knowledge to search for oil in Australia. A Californian company was on the point of nroriding the money when Australia’s nationalization policy became news. The Californian executives immediately drew out, saying they had lost 20,000,000 dollars through nationalization in Mexico. We could not interest American, Canadian or British companies in the Exmouth Gulf project.

I suggest to the members of the Labour party that when next they address themselves to the subject of oil they give some consideration to the type of encouragement they gave to the establishment of an oil industry in Australia.

– I am certain that the honorable senator would not like to be pilloried for everything done in the name of his party, and neither do I. Nevertheless, I remember that during that campaign the Treasurer (Sir Arthur Fadden) said that taxes would be reduced by 25 per cent., and the Prime Minister (Mr. Menzies) outbid him by an additional 10 per cent., or vice versa. That was a most interesting campaign. Those who say that the Australian Labour party has lived its political life on promises are like people who live in glass houses and throw stones.

Senator Paltridge read something, about oil from a pamphlet in -his possession. The honorable senator probably agrees with me that the best thing that could happen to the oil industry would be to place it under the control of the nation. Until atomic power can be used for industrial purposes, this country will be largely dependent on oil. Are we to be at the mercy of the oil cartels? Does the honorable senator not know that Sir Winston Churchill has said that those cartels held the British Government to ransom when Great Britain was the only democracy at war with Germany during World War II.? It is foolish to say that we are frightening capital away.

Senator Maher:

– We should get into a worse mess than Mossadeq did in Persia.

Senator KENNELLY:

– As long as the parties which the honorable senator supports are able to ensure a profit for the people who support them, they have no political principles at all. They are like birds that flit from twig to twig. Such a policy is all very well while they are in government. For my part, I do not want to see the Australian Labour party in government unless it attains office on the principles of the party. It does not matter to those who have spent their lives in the Australian Labour party whether they are in government or in opposition, as long as they continue to expound the principles of the party. For my part, that goes for the objective of the party as well. Indeed, that is the only reason why I am a member of the party. I should not want to be a member of it if its objective were not as it i3.

Senator Hannaford:

– The Australian Labour party will have to put its house in order.

Senator KENNELLY:

Senator KENNELLY:

– I propose that we leave the court to do its own work. Let us hope that justice will prevail.

The budget provides for a reduction of £32,000,000 in income tax. One cannot be other than pleased that it provides for that reduction. I should be very foolish to say that I did not want the Government to make any reductions in taxation but I am concerned as to who will receive these reductions. When I analysed the Government’s taxation proposals in order to ascertain who would be allowed reductions, I saw that the same old fatted pig had been greased once again. People who earn between £650 and £850 a year comprise 75 per cent, of those who pay income tax. Yet that 75 per cent, of taxpayers will be allowed only 31 per cent, of taxation reductions under the budget proposals. It has been estimated that reductions of taxation will amount to £32,000,000, and 75 per cent, of the people will receive only £10,000,000 of that amount. Taxation reductions should be given to those who need them most. From 1941 to 1949 the Labour Government levelled incomes in this country to a large extent. It did that with much pleasure because such action was needed. The Labour Government enjoyed taking back some of what were, in the main, ill gotten gains. I know of no people who could have felt the effect of that action more than certain legal men who support the Government. The Government has now proposed that the income tax payable by a man in receipt of £15,000 a year should be reduced by £671 a year which is the equivalent of £12 15s. a week.

Senator Mattner:

– Mr. Hill has £9,000 a year.

Senator KENNELLY:

– Who is Mr. Hill?

Senator Mattner:

– The Lord Mayor of Sydney.

Senator KENNELLY:

– Oh, apparently Senator Mattner is referring to Mr. Hills. I was thinking of some one who was appearing before a certain tribunal. Under the Gbvernment’9 proposals, the man on the basic wage with a wife and one child will have his income tax reduced by lOd. a week. I get rather tired of listening to arguments on this matter by honorable senators opposite who quote percentages. Wages are fixed by a court which, in effect, tells men how much they can eat and what their wives can wear. In discussing these matters I attempt to evaluate money by the level of the basic wage. Notwithstanding that the basic wage was about £6 a week in 1949 whilst it is now £12 a week each of those amounts was intended to provide the same amount of food, clothing and shelter. In 1949, a man on the basic wage with a wife and one child paid income tax of 16s. a year. As the basic wage is now approximately double the amount of the basic wage . in 1949, the most that the man on the basic wage with a wife and one child should have to pay in income tax is £1 12s. which is double the amount that was payable by such a man in 1949.

I am pleased that the Government has made an allowable deduction from income for taxation purposes an amount of £75 in respect of education expenses for children. However, I ask the AttorneyGeneral (Senator Spicer), who went through the University of Melbourne with great distinction, to give particular attention to the claims of those students who have to work part of the time in order that they may earn the fees to pay their way through the university. No deduction from income is allowed those people in respect of the fees that they pay to the university. I think that all honorable senators wish to help those who are battling their way through the universities. The least that the Government could do for them would be to make the amount that they pay in fees an allowable deduction from income for taxation purposes. If that cannot be done on this occasion I ask that the Government give the proposal favorable consideration in the future.

The Government has granted a reduction of sales tax, but it is interesting to examine the incidence of the new provisions. In the case of some essential goods, the Government has reduced sales tax from 12£ per cent, to 10 per cent. That is a reduction of 2£ per cent, or 6d. in the £1. Yet on luxuries, the Government has reduced sales tax from 16f per cent, to 12£ per cent., or more than 4 per cent. I cannot understand that. If the Government wants to give something back to the people by way of concessions of sales tax, at least it should lean towards concessions on essential goods rather than reductions on those that are not essential. I believe that if Senator Wright examines the list of articles on which sales tax has been reduced by 2i per cent, and compares it with the list on which there has been a reduction of 4 per cent., he will agree with me. The Government could achieve the same reductions in terms of money by reducing sales tax on essential goods only.

Senator Hendrickson:

– Even if Senator Wright agreed with that proposition, his party would not agree.

Senator KENNELLY:

– It is always good to see one person, at least, with independent thought. I direct my attention now to a tax that has caused some grave concern to honorable senators on both sides of the chamber. That is the pay-roll tax. I believe that it is a wrong tax. Senator Henty reminded honorable senators to-day that the Australian Government extracted pay-roll tax from many government and semigovernmental bodies. The Government of Victoria, the State that I represent, contributes nearly £1,000,000 a year by way of pay-roll tax. It is extracted from every municipality also. If the Government proposes to remove the pay-roll tax from any section of the community, it should give relief first to nonprofitmaking concerns. I am one who believes that we cannot have everything we would like in this world although I should be happy to know if there is any way of attaining them. I believe that the pay- roll tax is wrong because, like the sales tax, it has a cumulative effect. I do not know how many times the person at the bottom end of the production line pays it. The pay-roll tax is added to the cost of every process through which an article passes. It can start with a dealer in Flinders-lane and then go on all along the line until all of it, or a proportion of it, is recovered from some final source. I believe that often the person at the end of the line, who is actually charged with the tax, pays much more than it is alleged to be.

All who have given the matter serious consideration will agree that the only fair form of taxation is the income tax. All indirect taxation is a burden on the people on the lower incomes. Irrespective of what the political future may hold, I would vote for increased income taxation if I thought that indirect taxation would be abolished. I believe that I should be honest enough to do that. In abolishing indirect taxation, let us start with the sales tax and attack the pay-roll tax second. If the amount of money that is collected in those two taxes is essential for the conduct of the affairs of the nation, I personally would be prepared to vote to increase direct taxation to that extent and wipe out those two taxes at any time I had the opportunity.

It is true that the government has alleviated the means test as it is applied to the payment of pensions. I am pleased that the Government has decided to do so. A man aged 65 years with a wife aged 60 may have a total income of £7 a week and a home of their own and still receive a pension of £7, giving them a total income of £14 a week. I believe that that is extremely fair. Before I would want to see the means test alleviated any further, I should want to assist the pensioner who receives a pension of only £3 10s. a week and has no other income, and improve his lot. I know that 70,000 people who are in receipt of a pension will gain from this budget, but there are 420,000 pensioners in Australia. In effect, the Government is saying to the other 350,000 pensioners, “ You are not wanted “. I believe that 78 per cent, of the persons who are drawing the age pension have no other income. Therefore, I suggest that from now on we should lift the pension rates of the persons who are on the lowest range and give them more. If we do that, we shall be doing a service to the people.

I do not wish to reiterate the statements that I made about defence expenditure last year. I was grateful to be in the Senate when Senator Kendall spoke on this matter last week. I was also pleased to note that the Government has seen fit to put more money into the air arm of Australia’s defence. I am concerned about the amount that is provided for defence. I believe that no nation of 9,000,000 people can find the amount of money that has been provided for defence in Australia, even in the troubled state of the world to-day, but by the will of the people, the Government has the responsibility of administration. I, and all the people of Australia, simply say to the Government, “ See that this money is spent in the best way for the defence of Australia “. That is the only point upon which the Opposition would quarrel with the Government. Honorable senators on the Opposition side are keen to provide for the defence of Australia as is any honorable senator on the Government side. I believe the supporters of the Government would agree with that statement. No one person or political party has a monopoly of interest in the defence of Australia. Our only difference lies in the avenues of expenditure of the defence vote. Therefore I thank Senator Kendall for the speech that he made in this chamber recently.

I should like to speak on other matters including cancer, and in that connexion, I regretted to hear my home State of Victoria maligned by Senator Wedgwood, but as she is not in the chamber, I shall defer my reply to her speech until a later stage. I should like to refer briefly, however, to some phases of immigration. 1 know that immigrants are needed in Australia. We need them to help us develop the country, and we may need their help in its defence. On Saturday, however, I. was given some startling figures in relation to the percentage of tuberculosis sufferers among immigrants. More startling still was the percentage of immigrants who have become mentally ill since they arrived in Australia. The figures were given to me in conversation by one of the most responsible persons in Victoria. They were given to him as correct figures and I can only assume that they are accurate. Much as we desire immigrants to come to Australia, 1 charity begins at home. We should ensure that officials who are charged with the responsibility of examining immigrants do their job thoroughly in the interest of the nation. If those figures are correct, something is wrong somewhere, and it is too important to allow to pass. I am sure that honorable senators on both sides of the chamber will be just as interested in the answers as I will be. If the percentages that have been given to me are correct, there will have to be a change. The matter can be rectified only by changing our officials overseas or doing something equally drastic. Certainly something will have to be done in the interests of the nation.

Senator ANNABELLE RANKIN:
QUEENSLAND · LP

– I rise to support the Appropriation Bill. First I should like to congratulate the Treasurer (Sir Arthur Fadden) upon the early presentation of the budget. As the 1st July each year comes along, rumours begin to circulate about the probable date of the presentation of the budget and about its likely contents. There is speculation on whether taxes will be increased or reduced; whether subsidies will continue to be paid; and whether the budget proposals will affect the cost of living. With all this uncertainty in the community any delay that occurs in the presentation of the budget to the Parliament, affects considerably the normal flow of business, and a state of “budget jitters” exists. Thanks to the Treasurer, this year’s budget has been presented comparatively early and there has been an absence of disrupting rumours about budget proposals. Business has been able to proceed smoothly.

In recent years it has been the vogue to give budgets short, apt titles. We all recall that when a budget was introduced some years ago to counter certain weaknesses in our economy due to inflation, it was given the title of the “ horror budget “. That corrective budget could more honestly have been called a courageous budget. The budget which we are now discussing indicates a state of quiet prosperity in the community, and a continuing condition of well-being amongst the people. I have not yet heard a really apt title given to this budget, but I think it could well be called the “ people’s budget “. This budget is the most definite proof that the welfare of the Australian people is the first and greatest consideration of the Liberal party and the Australian Country party Government.

There are one or - two points in connexion with the budget that I should like to put before the Senate to-night. We on this side of the chamber are always spoken of by our political opponents as the representatives of wealthy interests, big business and monopolies. We are tired of hearing that. This budget proves that the Government of which I am a supporter, honestly and sincerely represents the working man and woman of Australia. It must be bitter medicine for our political opponents to realize that they no longer represent the people but only an economic theory known as socialism, about which we have heard something from honorable senators tonight. One of the most important features of this people’s budget is the taxation reductions that it foreshadows. Despite the threat to our peaceful way of life, the Government has been able to reduce taxes considerably. This is a creditable achievement in view of our large commitments for defence and the consequent necessity to expend huge sums of money on defence establishments. I believe it to be most important that the people of Australia should have the benefits of reduced taxation, because it means that they themselves will be given an opportunity to spend or save that money, according to their own desires. I am sure that the citizens of Australia prefer to determine what they shall do with their money rather than have it spent through the Government. Income tax reductions provided for in the budget average 9 per cent. The reductions range from about 20 per cent, on the lower incomes to 8 per cent, on the very high incomes. Those are very important figures. Since 1949, when this Government came into office, taxes have been reduced by about 30 per cent. That is a substantial reduction and one which I arn sure is appreciated by the people of Australia. In addition to returning appreciable sums to the people of Australia in the form of reduced taxes, the Government has also shown its solicitude for the welfare of the community by liberalizing social services and health benefits. That too illustrates my contention that this is a people’s budget. Because social services benefits and health benefits are administered by different Ministers, members of the public do not always appreciate the aggregate value of those benefits. I propose, therefore, to cite the aggregate expenditure that is incurred by the Department of Health and the Department of Social Services, because it tells a story which I am sure will be appreciated by the Australian people. Last year, expenditure by the Department of Social Services totalled £147,000,000, and £29,000,000 wa3 expended on health services, making a total of £176,000,000 for the two departments. In spite of the huge defence expenditure provided for in the budget, and in spite of the tax reductions to which I have referred, expenditure on health benefits and social services benefits, will be £34,000,000 and £159,000,000 respectively, or a spectacular aggregate of more than £193,000,000 for the year. In effect, that money will be paid back to the community in the form of .services. Those figures are significant. They are not just cold figures in black and white. They mean great services to the people of Australia in the current year.

Let us look at what our social services mean. Honorable senators opposite have referred to pensions, and various points of view have been expressed. I remind the Senate that the true meaning of the budget figures is that, as the Government fulfills its promise to liberalize the means test, more members of the community will receive pensions, and more people will receive greater pensions. The property exemption is to be raised from £150 a year to £200 a year. Income from property will in future he disregarded in applying the income test. This too points to the Government’s appreciation of the difficulties of the less fortunate members of the community. The con cessions will be of particular value to many aged people who own houses but who are unable to obtain possession of them and are receiving rent from tenants. Such concessions are of real and practical assistance to the community. With the easing of the means test, about 90,000 pensioners will receive increases of their pensions, and many thousands will be brought into the pension field and receive part-pensions. In addition, of course, they will receive other benefits such as free medicine and free medical benefits that go hand in hand with the payment of a pension. That,. I believe, is a splendid thing. It is important that we should ensure that when aged people are faced with illness they will know that they will be given the assistance they need to bring them back to health, or at least to make their illnesses more bearable. I repeat, therefore, that the figures that I have cited are not merely cold statistics. They mean more benefits for more people.

Increased assistance is also being given by the Government in the housing of aged people. I spoke on that subject in this chamber recently, and I shall not traverse the whole ground again, but I am proud that the Government has concerned itself with the problem of ensuring that citizens of this country, in the twilight of their lives, shall have satisfactory housing. By means of the assistance given through this people’s budget, church and charitable organizations will be able to house more aged people. Already these organizations are doing valuable work in this field. The provision of £34,000,000 this year for health benefits will ensure the continuation of the provision of free milk for schoolchildren. This is an important service which does much to ensure that the children of to-day will grow up to be strong and healthy citizens. This vote means too that life-saving drugs will continue to be available, free of charge, to the people of Australia. This, too, is a vital service to the community. Already the sick people of this country when they need assistance most, are being’ saved no less than £10,000,000 a year by the provision of these drugs. The health vote this year also includes provision to continue the fight against tuberculosis. Largely by the efforts of the Menzies Government, that disease is being eradicated from the community. Since this Government came into office, deaths from tuberculosis have been reduced tremendously. More hospitals are now available to deal with sufferers. The payment of tuberculosis allowances, the most generous in the world, means that concealed cases are coming forward for treatment. We hope that as the result of earlier treatment, many more sufferers will be completely cured. In addition, the problems and worries associated with going into hospital have been greatly alleviated by the voluntary hospital insurance scheme, subsidized by payments from the Commonwealth.

In conclusion, as we come to the end of this sitting day, I stress again the point that I made when I began my remarks. This Government is indeed a government that is concerned with the welfare of all the people of Australia. This people’s budget has, I believe, proved beyond doubt the desire of the Government to provide the vital needs of the people of this community. I remind the Senate that, through lower taxation, the people will have more money in their hands, to spend or to save, as they wish; more people have been brought within the ambit of the social services scheme ; more people are being assisted by health benefits than ever before; and there are greater repatriation benefits. On more than one occasion, the Government has provided further assistance for family units. Therefore, I believe that this budget proves to be wrong the accusation of the Opposition that this Government is not concerned with the welfare of the working men and women of this community. This Liberal party-Australian Country party Government has, I believe, shown the greatest concern for all sections of the community ever shown by any government in the history of the Commonwealth. In my view, and, I believe, in the view of the majority of Australians, this is a budget of which the Government can be very proud. Not only have we done much for the people, but we have proved to them that, as a government, we have their welfare at heart most sincerely.

Motion (by Senator McLeay) put -

That the question be now put.

The Senate divided. (The President - Senator the Hon. A. M. McMullin.)

AYES: 28

NOES: 20

Majority . . 8

AYES

NOES

Question so resolved in the affirmative.

Question put -

That the words proposed to be left out (Senator McKenna’s amendment) be left out.

The Senate divided. (The President - Senator the Hon. A. M. McMullin.)

AYES: 21

NOES: 28

Majority . . 7

AYES

NOES

Question so resolvedin the negative.

Original question resolved in the affirmative.

Bill read a first time.

Second Reading

Senator SPOONER:
Minister for National Development · New South Wales · LP

– I move -

That the bill be now read a second time.

This measure authorizes the appropriation of revenue for the ordinary services of the various departments. The hill provides for an appropriation of £289,138,000 for the services of the year 1954-55, to which should be added the amount already granted under Supply Act No. 22 of 1954, namely £151,002,000, making a total amount of £440,140,000. This is the estimated expenditure from annual appropriations for ordinary services for the year 1954-55, as set out in the second schedule to the bill.

The expenditure proposals of the Government have already been covered in the budget speech and it is not intended to deal now with the various items in detail. Any explanations that may be desired by honorable senators will be furnished at the committee stage.

Debate interrupted.

page 549

ADJOURNMENT

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.

Question resolved in the negative.

page 549

APPROPRIATION BILL 1954-55

Second Reading

Debate resumed.

Motion (by Senator Armstrong) put -

That the debate be now adjourned.

The Senate divided. (The President - Senator the Hon. A. M. McMullin.)

AYES: 21

NOES: 28

Majority . . 7

AYES

NOES

Question so resolved in the negative.

Senator ARMSTRONG:
New South Wales

.- This bill proposes to grant and apply out of the Consolidated Revenue Fund the sum of £289,158,000 for the services of the year 1954-55, to which should be added the amount, already granted under Supply, of £151,002,000, making a total of £440,140,000. I have examined the votes of the various departments and have been interested to find that over-estimates running into many millions of pounds have been made. Last year, for instance, the Government over-estimated the requirements of the departments by approximately £4,500,000. I suggest that that is another way of refusing to pass back to the taxpayers money that could well be in their pockets rather than hidden in this fashion.

Senator Kendall:

– How does the honorable senator know that overestimates have been made?

Senator ARMSTRONG:

– I have studied the Estimates. As I have said, last year the over-estimations amounted to about £4,500,000. The additional appropriations with which the Senate is now dealing made me feel that further substantial amounts will be concealed. I suppose that, in relation to private companies, such sums would be referred to as. “ hidden reserves “.

I have been looking for an item of appropriation for the Foreign Affairs Committee, to which reference has been made during earlier debates in the Senate. I suppose that that committee costs the Government something, although the cost may not be very great. The. Opposition would like very much to serve on this committee, if only because of the educational value of such service, but we on this side of the chamber need to be convinced that we would be given scope to express our opinions. There is no question that the formation of this committee constitutes a departure from the precedents that have been laid down in connexion with such committees. During the previous Parliament, members of the Opposition had certain discussions with the Minister for External Affairs (Mr. Casey), at which Senator Gorton was present, and I think that a very fair and amicable arrangement concerning the functions of the committee was reached. Because the life of the Parliament was coming to an end, however, nothing further was done at that stage. At the beginning of the current Parliament, the matter was raised in the House of Representatives by the Minister for External Affairs, but the arrangements made at the discussions to which I have referred were not incorporated in the motion for appointment of the present committee. That omission has again caused the Opposition to lose confidence in the bona fides of the Government, which is unfortunate, because this is a committee on which a substantial number of members of the Opposition would be happy to serve. In my opinion, it could be easily the most important of all the Parliamentary committees. In the present circumstances, the committee system in this Parliament is essential to the wellbeing of rankandfile members. As I see it, private members must be given special work to do. The work of debating is not sufficient. The opportunity to do other work and engage in certain studies would enable them to develop their minds along certain lines and so become ‘better informed. The more knowledge a member has, the better will he be able to represent the people. In the early days of the war, the previous Labour Government established important committees of all kinds which performed worth-while tasks. They served, also, as a means whereby the members of the Parliament might obtain greater knowledge and so become more competent.

I do not understand why the Minister for External Affairs should have ignored the talks that we had in relation to the Foreign Affairs Committee. It must have been obvious to him that the Australian Labour party would not accept conditions other than those that had been expressed unofficially. The Minister is directly responsible for the fact that that committee has been unsuccessful. He is overseas at the moment, and I have no doubt that the Parliament will have adjourned for the Christmas recess before he returns. The fact remains that the Opposition would have joined in the committee if a genuine proposal had been made by the Government. The Government has not seen fit to confer on the committee the status that it- deserves. It has not been consulted in the way that we thought it would be consulted. As reports have ceased to come from the committee, I do not know whether or not it is still meeting. It seems to have lost its early enthusiasm. The Government had an opportunity to recognize the importance of the committee by sending one of its members - preferably the chairman - to the current sittings of the United Nations organization. I consider, also, that one of its number should have been sent to the Manila conference as an observer. Even the newspapers of this country thought that the drafting of the Seato treaty was sufficiently important to warrant their representatives being present. I was very interested to read about the interview a newspaper correspondent named Loxton had with the Mayor of Manila. After joining the mayor in eight whiskies, he poured one over the mayor’s head, in order to demonstrate what he had done to another gentleman. Although the Government claims that the committee’s work is important, it has not recognized the committee. One of the best ways in which the Government could convince the people of the importance of the committee, which is a working committee, despite the fact that no representative of the Opposition is included in its personnel, would be to recognize it. The sooner that is done, the better.

I come now to the matter of the invisible amounts which are included in the Estimates of every department. Senator Paltridge referred in general terms to this factor this afternoon, and Senator Kennelly pointed out that the most important problem facing this country is our high cost structure. One very important aspect of invisible expenditure relates to shipping freights. The Government has allowed itself to be insulted by the great shipping combines. It should retain the reins of government. Invisible expenditure is incurred in connexion with every commodity that we import and export. We are a tremendous importing country. In this year, the value of our imports will probably he about £800,000,000. We absorb an extraordinarily large proportion of the production of other countries. Australia is the greatest importer of textiles, and is probably the biggest importer of motor cars produced in the United Kingdom. Because of our tremendous capacity to import, wc are carrying an enormous proportion of the burden of high shipping freights. It is reflected in every aspect of our economy. The Government recognizes that we have been cheated by the shipping combines. Recently, when I went to the Department of Trade and Commerce to seek help for a section pf the fishing industry, I found ‘ that frozen tuna that is shipped to the United States of America by the American Pioneer Line is carried at about a half of the freight charged by British lines which are plying to New York. Although I only get a glimmer of information in relation to these matters, the Minister for Shipping and Transport (Senator McLeay), who is sitting at the table, has made a close study of them. The Minister for National Development (Senator Spooner), also> is in possession of details which support my contention that the high freights charged for the carriage of commodities to and from Australia are completely unjustifiable. In 1949, we enjoyed about 42 per cent, of the Singapore market for tinned foods; to-day we have only about 7 per cent, of that market, duo to the fact that freight on tinned food from Europe to Singapore is about 50 per cent, cheaper than from Australia, although the distance from Europe to Singapore is about twice the distance from Australia to Singapore. In Hong Kong, we’ are rapidly losing our tinned milk market, because the freight on tinned milk from Holland to Hong Kong is only about 40 per cent, of the freight charged from Australia to Hong Kong, . although the distance from Holland to Hong Kong is almost three, times the distance of Australia from Hong Kong. The Australian Government seems to be powerless to rectify the position. The Minister for Shipping and Transport has written letters to the shipping companies pleading with them to reduce freights on Australianproduced commodities, but the shipping companies have not even extended to him the courtesy of saying that they will consider the matter. When the Australian Government recently legislated to reduce, the levy on the Australian shipping companies to provide a fund’ for the payment of appearance money, whereupon those companies reduced freights on the Australian coast, the overseas shipping companies immediately increased freight charges. In effect, they put the back of their hands across the face of the Government. I do not know what the Government is going to do about the matter. An enormous quantity of money is taken out of the Australian economy through excessive shipping freights.

Invisible imports involve an expenditure of about £135,000,000 a year. That is big money, in anybody’s language. I do not know the proportions represented by freight and insurance respectively, but they are both very substantial figures. I think the Minister for Shipping and Transport would be the first to admit that we are being cheated by the Conference shipping lines, which have a monopoly on the shipping trade to and from Australia. There are only two approaches to this problem. The first is that the Australian Government must never sell the Commonwealth line of ships; however bad a deal might be now, the ultimate result, because of our having no ships with which to compete with the overseas shipping companies, would he infinitely worse. The second approach is, that we must give serious consideration to the establishment of a national shipping line, by purchasing, chartering, or building ships. Why should not a country as big as Australia develop its own shipping line? Even the comic strips in the newspapers contain references to a Greek shipping merchant who, within a few years, built up the greatest line of tankers in the world. The establishment of our own international shipping line would provide a very important service to the people of Australia. Excessive shipping freights are adding greatly to our cost structure. The Government should do something about this matter.

I come now to the Australian aluminium industry. Although this matter does not come within the purview of the Minister for Shipping and Transport, I know that ho is very interested in it. Now is the time to plan an extension of the Australian Aluminium Production Commission’s undertaking at Bell Bay, in Tasmania, which is expected to produce about 13,500 tons of aluminium a year. I consider that, by the time the works are completed next year, we will be importing as much aluminium as we were before the plant was established, due to the fact that greater quantities of aluminium are now being used in industry in this country. We should aim to make ourselves self-sufficient in this field. We should also establish fabricating plants to handle the Tasmanian production.

Motion . (by Senator McLeay) put -

That the question be now put.

The Senate divided. (The President - Senator the HON. A. M. McMULLIN.)

AYES: 28

NOES: 21

Majority . .7

AYES

NOES

Question so resolved in the affirmative.

Original question resolved in the affirmative.

Bill read a second time and committed pro forma; progress’ reported.

Senate adjourned at11.1 p.m

Cite as: Australia, Senate, Debates, 28 September 1954, viewed 22 October 2017, <http://historichansard.net/senate/1954/19540928_senate_21_s4/>.

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Senate28 September 1954

QUESTION

CIVIL AVIATION

Senator GUY:TASMANIA

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

QUESTION

IMMIGRATION

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

Senator SPICER:Attorney-General · VICTORIA · LP

QUESTION

SHIPPING

Senator LAUGHT:SOUTH AUSTRALIA

Senator McLEAY:LP

QUESTION

SCALLOPS

Senator HENTY:TASMANIA

Senator McLEAY:LP

QUESTION

CANBERRA

Senator TANGNEY:WESTERN AUSTRALIA

Senator McLEAY:LP

QUESTION

TIN

Senator GUY:

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

QUESTION

WINE

Senator CRITCHLEY:SOUTH AUSTRALIA

Senator McLEAY:LP

QUESTION

WHEAT

Senator VINCENT:WESTERN AUSTRALIA

Senator McLEAY:LP

QUESTION

WAR MEMORIALS

Senator LAUGHT:

Senator McLEAY:LP

QUESTION

BROADCASTING

Senator AMOUR:NEW SOUTH WALES

Senator COOPER:Minister for Repatriation · QUEENSLAND · CP

APPROPRIATION (WORKS AND SERVICES) BILL 1954-55

Second Reading

Senator SPOONER:Minister for National Development · New South Wales · LP

APPROPRIATION BILL 1954-55

Senator McKENNA:Leader of the Opposition · Tasmania

Senator WRIGHT:TASMANIA

Senator McKENNA:

Senator Wright:

Senator McKENNA:

Senator Spicer:

Senator McKENNA:

Senator Hannaford:

Senator McKENNA:

Senator McCallum:

Senator McKENNA:

Senator Spooner:

Senator McKENNA:

Senator Spooner:

Senator McKENNA:

Senator Spooner:

Senator McKENNA:

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

Senator McKENNA:

Senator Spicer:

Senator McKENNA:

Senator Vincent:

Senator McKENNA:

Senator Paltridge:

Senator McKENNA:

Senator SPOONER:LP

Senator McKENNA:

Senator McKENNA:

Senator GORTON:VICTORIA

Senator McKENNA:

Senator Guy:

Senator McKENNA:

Senator Vincent:

Senator McKENNA:

Senator Vincent:

Senate
28 September 1954

Senator GUY:
TASMANIA

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

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

Senator SPICER:
Attorney-General · VICTORIA · LP

Senator LAUGHT:
SOUTH AUSTRALIA

Senator McLEAY:
LP

Senator HENTY:
TASMANIA

Senator McLEAY:
LP

Senator TANGNEY:
WESTERN AUSTRALIA

Senator McLEAY:
LP

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

Senator CRITCHLEY:
SOUTH AUSTRALIA

Senator McLEAY:
LP

Senator VINCENT:
WESTERN AUSTRALIA

Senator McLEAY:
LP

Senator McLEAY:
LP

Senator AMOUR:
NEW SOUTH WALES

Senator COOPER:
Minister for Repatriation · QUEENSLAND · CP

Senator SPOONER:
Minister for National Development · New South Wales · LP

Senator McKENNA:
Leader of the Opposition · Tasmania

Senator WRIGHT:
TASMANIA

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

Senator SPOONER:
LP

Senator GORTON:
VICTORIA

Senator HENTY:
Tasmania

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

Senator O’BYRNE:
Tasmania

Senator MARRIOTT:
TASMANIA · LP

Senator PALTRIDGE:
Western Australia

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

Senator KENNELLY:
Victoria

Senator GEORGE RANKIN:
VICTORIA · CP