22nd Parliament · 1st Session
The PRESIDENT (Senator the Hon. A. M. McMuilin) took the chair at 10 a.m., and read prayers.
– I direct a question to the Minister representing the PostmasterGeneral. It relates to the proposed increased charges for the installation of telephones in businesses and private residences. Does the Government intend charging the increased fee to the many thousands of people who have had applications in for a telephone service in some instances for as long as eighteen months or two years?
– Order! As the honorable senator’s question anticipates the discussion on the budget papers, it is not in order.
– The honorable senator will have an opportunity to raise that matter during the debate on the Estimates and Budget Papers.
– In addressing a question to the Minister representing the Minister for Primary Industry, I might explain briefly that the members of the Cadell branch of the Australian Dried Fruits Association are vitally interested in the claim which has been made on the United Kingdom Government under the Support Prices Agreement covering the 1 954 season’s sales of currants and seeded and unseeded lexias A month ago, the Minister informed me that discussions were proceeding at the official level and that the Commonwealth was doing all in its power to have the claims admitted by the United Kingdom Minister. Has the Minister any information which he can give to the Senate and which would be of value to the members of the Cadell branch and others concerning the matters which I have referred to him?
– The matter referred to by Senator Pearson has been the subject of written negotiations between the United Kingdom Ministry of Agriculture and the Australian Dried Fruits Association. The position at the moment is that the
United Kingdom Department of Agriculture has rejected the last proposals put forward by the Australian Dried Fruits Association, and the chairman of that association has now suggested that an independent arbitrator should be accepted by both sides to the dispute and that his finding should be accepted as the basis of a settlement. I am not aware that the Commonwealth Government has yet been told of the reaction of the United Kingdom Ministry of Agriculture to that proposal. I will make inquiries of my colleague, Mr. McMahon, and find out if the matter has progressed beyond the point where the council’s proposal has been submitted to the United Kingdom Ministry of Agriculture.
– I address a question to the Minister representing the Minister for Primary Industry. On what basis is the allocation made for tobacco leaf imports? Is the basis designed deliberately to ensure the use in blends manufactured in Australia of the whole of the useable portion of the Australian tobacco crop? Does the basis differentiate between manufacturers competing in the Australian market to the extent that the ability of some manufacturers to compete at auction for Australian tobacco is adversely affected? What is government policy regarding the expansion of the Australian tobacco growing industry, and will expenditure of government money in experimental and expansion work in the industry serve any useful purpose in the absence of government action to protect the interests of Australian growers?
– I can say briefly that the Government’s policy is this matter is to ensure that the greatest quantity of Australian leaf is used in the manufacture of tobacco, but as the important series of questions asked by the honorable senator covers so many aspects of the matter, I ask him to put the question on the notice-paper, and I shall obtain a considered statement from the Minister.
– In view of the constant criticism of company profits in Australia expressed by the Opposition, has the Minister representing the Treasurer any comment to make on the information in that connexion contained in the White Paper entitled “ National Income and Expenditure 1955-56”?
– The White Paper referred to shows that company profits were estimated at £550,000,000 . last year. That was an increase of 4.9 per cent, on the previous year. That increase of 4.9 per cent, fell substantially below the 6.1 per cent increase of the national income and the 8.9 per cent, increase of total wages and salaries paid. The point is that, in an expanding economy, profits earned by companies did not increase proportionately to the increase of the national income and total wages and salaries paid. Those profits are subject to tax of at least 8s. in the £1. The dividends that are paid from them are again subject to tax in the hands of shareholders, and at least £250,000,000 of the £550,000,000 profits comes back to the Government in the form of taxation. I remind honorable senators that those companies are the major employers in Australia, and make a major contribution to the development of this nation. I make the simple suggestion that honorable senators opposite in their constant criticism of their fellow citizens who are the shareholders in those companies, run the risk of killing the goose that lays the golden eggs.
– Will the Minister representing the Minister for Social Services inform the Senate whether it is a fact that paralysed cripples are being exploited by the Department of Social Services? Is it not true that certain poliomyelitis victims, who have been permanently and totally incapacitated in the lower limbs, after being partly rehabilitated are denied the invalid pension when out of work, and are compelled to take the lower unemployment benefit, even when there is no other work available?
– Having at one time had the honour of being Minister for Social Services, I must indignantly repudiate, any suggestion that the department is exploiting social services beneficiaries. The officers of the department are there merely to carry out Government policy, and I am sure that they do so faithfully and sympathetically. I find it difficult to answer offhand the point raised by the honorable senator. I know that the rehabilitation system has been one of the very good services under the direction of the Department of Social Services. I cannot say offhand what the arrangements are. Allowances are made while these people are undergoing training, and a different scale of allowances is made when they finish their training and go into employment. I am quite sure that all those arrangements have been very carefully evolved and are very sympathetically administered.
– My question, which is directed to the Minister for Shipping and Transport, relates to the loading of potatoes on “ Enfield “ which has been taking place at Ulverstone in Tasmania. “ Enfield “ has now been switched from the port of Ulverstone to Devonport, and that has caused some inconvenience to the potato growers in the Ulverstone area. I recently received a telegram from the Ulverstone Harbour Trust which reads -
Kindly enter protest proposal Enfield load next trip Devonport feel confident merchants can obtain potatoes full load.
Will the Minister indicate whether “ Enfield “ will continue to load at Ulverstone?
– Apparently, several Tasmanian senators have received requests from the Ulverstone Harbour Trust similar to the request mentioned by Senator Wardlaw. I inquired why “ Enfield “ was diverted to Devonport, and I discovered that the chairman of the Tasmanian Potato Shippers Committee has advised the Australian Shipping Board that there may not be a full load of potatoes ready for loading at Ulverstone when “ Enfield “ next calls. I have confirmed that with the agents for the vessel, whose information is the same as I have detailed. For that reason the ship has been diverted to Devonport, where there is sufficient tonnage of potatoes awaiting shipment. The method by which space is allocated for the shipment of potatoes from Tasmania is that allocations are requested by the Potato Shipping Committee of Tasmania, the body set up by the Tasmanian Government to end the prolonged differences of opinion which were occurring between the various interests as to what space should be allotted for potatoes from the various Tasmanian ports..
That committee is in direct touch with the shipowners and the Australian Shipping Board as to the allocation of space. In this case it would appear that there is a conflict of opinion between the Ulverstone Harbour Trust and the Potato Shipping Committee, and the Australian Shipping Board, under the arrangement I have indicated, has taken the only advice that it reasonably could take, which is the advice of that committee.
– My question is directed to the Minister representing the Treasurer. In view of the Treasurer’s statement on profits of companies, will he inform the Senate how much has been collected in taxation out of the millions of pounds profit made by registered societies under the medical benefits scheme? Such profits have amounted to millions of pounds in the last few years, and it would be interesting to honorable senators to know how much has come back to the Government by way of taxation.
– I do not know the circumstances of organizations registered under the medical benefits scheme, but if they are profit-making companies then they are subject to taxation in the same way as are all other corporations.
– Is the AttorneyGeneral aware that Sir Jack Stevens, chairman of the Atomic Energy Commission, retired shortly after his return from an important mission overseas on business of the Atomic Energy. Commission? While I am not greatly interested in the whys and wherefors of his resignation, I should like the Minister to inform the Senate whether he considers that in future the Government should obtain an undertaking from highranking public servants about to go abroad to ensure that they will be willing to serve the Government for a definite period of years following their return?
– I am not aware of the precise position of Sir Jack Stevens at the moment. I think there is a good deal of merit in the suggestion implicit in the second part of the honorable senator’s question, that high-ranking public servants going overseas on public business should be available to give the benefit of their experience to the Government which send* them. I shall bring this matter to the noticeof my colleagues.
– I direct a question; to the Minister representing the Treasurer. Will he be so good as to find out and tell the Senate how many trading and financial corporations were operating in Australia on- 1st July, .1955, as compared with the number operating on 1st July, 1956? How many persons were employed in Australia on those dates?
– I shall endeavour to obtain the information required by the honorable senator. I again emphasize the point I made earlier that the expansion of company profits has fallen short of the expansion of the national income.
– I direct a question to the Minister for National Development. Since problems relating to irrigation and drainage are of such great moment I ask the Minister whether he intends to send a competent representative to the InternationalConference on Irrigation and Drainage to be held in San Francisco in 1957 in order to obtain first-hand knowledge of the experiences and progress of other countries in this field?
– I was not aware that such an international conference was to be held,- and I thank the honorable senator for bringing the fact to my notice. I shall give very careful consideration to the suggestion.
– Bearing in mind thewelldeserved eulogy of the Navy delivered by the Minister for the Navy, I ask the Minister whether the submarine is vital for Australian security, both in attack and defence? How many Australian submarines, are attached to the Royal Australian Navy? Is Australia- dependent on the United Statesof America, in the event of war, for submarine assistance to defend our shores? Has. the Minister any information regarding the number of Russian submarines in Pacific waters? Are any Australians being trained in submarine service?
– I shall begin with the last question asked by the honorable senator. From memory, 1 cannot say how many Russian submarines are in Pacific waters, but the best information to hand is that Russia has the largest submarine fleet in the world. It is very substantial - of the order of 400 vessels. Where they are located and disposed, we do not know. Australia has not built, and does not possess submarines of its own. Such as we have are on loan from the Royal Navy. Our men are being trained in the operation of submarines. In the unfortunate event of war we would, of course, rely on our friends and allies for submarines and for other aid, but at the same time we would render them such service as we were able to give.
– I ask the Minister representing the Treasurer, in view of the necessity of encouraging technical education in electronics, both for civil purposes and in order to provide a reservoir of trained personnel for the defence services, and in view of the fact that licensed radio amateurs are filling a large part of the gap in these requirements, will the Minister consider exempting from sales tax all electronic and radio equipment sold to persons holding amateur radio transmitting or experimental licences, provided that such equipment is for experimental purposes, and that such persons quote their call sign or a special sales tax number?
– I cannot answer the honorable senator’s question offhand, but I shall confer with my colleague, the Treasurer, and ask him to give the honorable senator his views upon the proposal.
– My question is directed to the Minister representing the Minister for Primary Industry. Is the Minister aware of a press report to the effect that a large sale of wheat, representing millions of bushels, has been arranged between the United States of America and the Indian Government? If so, can the Minister say whether the Australian Wheat Board was consulted about the deal? What were the advantageous circumstances enabling the United States to have preference against Australia notwithstanding that it is, similarly, a member of the International Wheat Agreement?
– I am not aware of the particular transaction of the sale of wheat to which the honorable senator refers. I shall confer with my colleague, the Minister for Primary Industry, and obtain answers for the honorable senator in that regard.
– Last week, I addressed a question without notice to the Minister representing the Minister for Labour and National Service in relation to the unemployment problem in Western Australia. In answering that question the Minister. was good enough to indicate the position in that State as at some time in August. Has he any later information which he can give to the Senate in relation to this subject?
– I am getting figures on the trend of employment regularly each week from my colleague, the Minister for Labour and National Service. The figures I mentioned previously were for the week ended 18th August. The figures I have for the week ended 25th August relate only to unemployment benefit. They show that in Western Australia 2,304 persons were on unemployment benefit as against 2,333 the previous week. The total for Australia for the week ended 25th August was 10,177 as against 10,416 the previous week. I mention the figures not because of their variation, but to illustrate the point that my colleague does keep this matter under very close consideration so that he can see what is happening from week to week and do what he can to control the position to advantage.
– T address a further question to the Minister representing the Minister for Labour and National Service. Is it a fact, as reported in the press, that 600 Italians have left Western Australia because of the unemployment position there? Approximately, 300 have emigrated to other States and 300 have returned to Italy-!”
– I have no information on the point.I did not see the report in the newspaper soI cannot help the honorable senator’s inquiring turn of mind.
– Will the Minister seek information as to whether the statement that appeared in the press is correct or otherwise?
– If the honorable senator will put his question on notice, I shall no doubt prove to him in due course that he is wrong as usual.
– My question is directed to the Minister representing the Treasurer. Is it a fact that the figures given by the Minister for National Development in answer to a question by Senator Henty on company income for 1955-56 are based on an estimate only? Is it true also that at the corresponding budget time in 1 954 the estimated income of companies was £415,000,000, whereas the actual income was later found to be £478,000,000; and in 1955 the estimated income was £505,000,000 whereas in actual fact the income was £523,000,000? As the figures I have cited are takenfrom official sources, it would seem that the figures given by the Minister for National Development are based on wrong premises.
– This is the usual tussle as to the interpretation of figures. I cannot, off the cuff, argue the point as to whether the honorable senator has the correct figures. I make the suggestion that he may have looked at the wrong column because I had a careful look at my own figures to ensure that they were right.I do not know what more we can do than take the figures in the white papers that are put before Parliament. They are more than estimates. There is, of course, a great deal of estimation in them, but they are based on progressive figures that arise during the year. Figures for the remaining portions of the year are estimates.
– The Minister has suggested thatI might have looked at the wrong column. If he so desires, I shall hand the statement to him, so that he can see for himself that I did not look at the wrong column.
– Were the figures obtained from the budget or from the White
Paper on national income and expenditure that was presented to the Parliament?
– The figures were obtained from the White Paper that is attached to the budget papers.
– Will the AttorneyGeneral inform me whether the chairmanship of the Constitution Review Committee is vacant because of Senator Spicer’s appointment to the Commonwealth Arbitration Court? If the position is vacant, can the Minister say whether that is the reason why Mr. Playford, the Premier of South Australia, has said that the Constitution Review Committee was only fiddling around with the matter of constitutional alterations?
– In answer to the first part of the honorable senator’s question, it is a fact that there has been a vacancy in the position of the chairman of the Constitution Review Committee since the resignation of Senator Spicer. What the Premier of South Australia has said in that regard, I do not know; why he said it, I do not know; and whether he said it, I do not know.
asked the Minister representing the Minister for Trade, uponnotice -
– The Minister for Trade has supplied the following answers: -
At the same time I should mention that there -are long-standing administrative devices which assist small importers. The most notable of these is the provision which permits holders of quotas of less than £1,000 per annum to use that quota in full at any time during the licensing year, instead of in quarterly amounts as in the general practice.
It will be appreciated, however, that the present overseas exchange situation is an extremely tight one and it has now become increasingly difficult to provide these extra licensing facilities beyond normal quotas if we are to achieve the target reductions in imports set by Cabinet.
These problems mean that so far as the small importer is concerned, he too will be largely confined to his normal quota entitlements in the future, but, as I have explained earlier, these entitlements represent his reasonable share of the import trade, fairly arrived at under the quota system.
asked the Minister for Shipping and Transport, upon notice -
If so - (a) what are the names of the companies; (b) for what vessels was approval given;
– The answers to the honorable senator’s questions are as follows: -
– by leave - I desire to submit a statement relating to the case of Private Luxton, which has been the subject of question and answer in the Senate for some considerable time. During the course of my questions and answers, my colleague, the Treasurer (Sir Arthur Fadden) stated that he would have a statement of the circumstances made for the information of the Senate. The Commonwealth Employees’ Compensation Act 1930-1954 is administered by the Treasurer. As the appeal by Mr. F. Luxton was being considered it was not possible before the conclusion of the last sittings to reply to this question. However, the Treasurer wrote to Senator Ryan and to Senator Critchley on 3rd July last. In view of their very close interest in Mr. Luxton’s claim and their representations on his behalf, the Treasurer has asked me to make this detailed reply to the substance of the matters appearing in the question, although it has been discharged from the notice-paper -
The Commonwealth’s liability to National Service trainees is prescribed by the Commonwealth Employees’ Compensation Act 1930-1954 which also applies to all civilians who are employed by the Commonwealth. The relevant sections apply in different circumstances to injury by accident and to disease; liability for the consequences of a disease exists only if it is due “ to the nature of the employment “. Liability does not otherwise exist for disease, e.g. for the consequences of those whose sole relation to employment is that they occur during the course of employment.
The claim by Mr. Luxton was made under section 10, i.e. in respect of incapacity resulting from a disease due to nature of his employment. The Minister for the Army, on 1st October, 1953, stated the right of a dissatisfied claimant to appeal to a local court. It was the claim under section 10, and the decision to disallow it, which was the subject of an appeal lodged in the local court of Adelaide on 14th December, 1955. The claim, the appeal and all discussion of Mr. Luxton’s claim centred upon a disease and upon section 10 of the Act.
Upon receipt of the Attorney-General’s opinion, the Treasurer advised Senator Ryan, on 3rd July of the conclusion of the Attorney-General that liability did not exist under section 10 of the Act.
On the other hand, the Attorney-General, at the same time, advised that recent authorities have extended the claims which are subject to compensation and has now given the opinion that the contraction of a common cold in some circumstances constitutes “ an injury by accident “ within the meaning of the Act. Moreover the act provides that aggravation of the injury is in itself an injury. His opinion was that, in the circumstances of the case, Mr. Luxton’s contracting broncho-pneumonia was the result of aggravation of a previous injury by accident and as such constituted in itself an injury by accident arising out of his employment. Upon receiving this advice, the Commissioner for Employees Compensation therefore decided that liability would be admitted if a claim was made by Mr. Luxton under section 9 of the Act. His legal advisers were informed of this conclusion so that a new claim might be made and, if they wished, the appeal in respect of the claim and the termination made under section 10 of the Act discontinued.
A new claim by Mr. Luxton under section 9 of the Act was received by the Commissioner on 16th August, and liability on that claim was admitted on 20th August.
I assure Senator Ryan and Senator Critchley, who have pursued this matter so closely, that there has been no indifference to the feelings of Mr. Luxton or to their representations. The original determination on the claim under section 10 was in accordance with established practice and principle, and it is confirmed that liability did not rest upon the Commonwealth under that section. The opinion that the common cold may impose a liability upon the Commonwealth under section 9 and constitute injury by accident is based upon recent authorities and was not one on which a claim had been made by Mr. Luxton or considered. However, as soon as the Commissioner was advised that liability existed under section 9, he informed Mr. Luxton’s legal advisers so that he might consider making a claim under that section of the Act.
Motion (by Senator O’sullivan) - by leave - agreed to -
That Senator Wade be appointed to fill the vacancy now existing on the House Committee.
Debate resumed from 5th September (vide page 142), on motion by Senator Spooner -
That the following papers be printed: -
Estimates of Receipts and Expenditure, and Estimates of Expenditure for Additions, New Works, and other Services involving Capital Expenditure, for the year ending 30th June, 1957,
The Budget 1956-57 - Papers presented by the Right Hon. Sir Arthur Fadden in connexion with the Budget of 1956-57, and
Upon which Senator McKenna had moved by way of amendment -
That all the words after “ That “ be left out with a view to insert in lieu thereof: - “the Estimates and Budget Papers 1956-57 tabled in the Senate are unacceptable and should be rejected because they seek to implement policies which are seriously detrimental in their effect on the interests of Australia and for which the Government deserves to be censured “.
– When the Senate adjourned last night, I was referring to the importance of stimulating investment in government loans. I pointed out that the budget that is before us provided for capital works totalling £110,000,000, and that there was the usual promise to underwrite loans for State programmes. I remind honorable senators that the Commonwealth has advanced to the States from Consolidated Revenue - that is money provided by the taxpayers - £74,000,000 in 1953-54; £59,000,000 in 1954-55; and £91,000,000 in 1955-56. Therefore, it is important that government borrowings should be successful.
Correlative with that need is the question of saving, and the availability of money for Commonwealth loans. During the coming financial year, loan redemptions totalling £149,000,000 will have to be met by the Treasury and before 1961, the colossal total of £870,000,000 of loan redemptions will be faced. In addition, there will be a need to raise sufficient money to continue the vast developmental programmes that the States, as well as the Commonwealth, have in view. It is refreshing to note in the “ Adelaide Advertiser “ yesterday that a recent loan floated by the Commonwealth Government was oversubscribed. That is very satisfactory, and gives further emphasis to the point I made last night that, since the introduction of this budget, there has been a general lift in the bond market and in good shares on the share market.
I believe that wrong theories have been applied to the matter of saving in the past. We hear constantly from members of the Opposition that, during the post-war period, the Chifley Government had no difficulty in filling government loans at record low rates of interest, but the reason is easily seen. In those years, Australia was in an economic strait-jacket. There were no opportunities for general investment other than government loans, and the surplus of money that was being saved was channelled, of necessity, into them. Since that time, Australia has gone ahead as shown in the figures I cited last night, both in population and national income. There is no comparison between the conditions that exist now, when the Government is competing for loan money with industries and municipalities, and the days of the Chifley regime.
This Government has been somewhat misguided by the advice that was tendered to it early this year by a group of professional gentlemen who met and issued a statement. In it, there was a recommendation to the Government that it should “ draw off “ from the community certain surpluses. They suggested that that should be done by taxation. I believe that there are great dangers in a policy of siphoning off into government coffers money for the Government to spend, instead of allowing the taxpayers of the community to use it. I think there should be a positive programme to make saving attractive and, in that connexion, I have some ideas to place before the Government.
The first point I wish to make is that governments should float loans of shorter duration. It has been interesting to note the steady nature of short-term government loans. Their attractiveness is very noticeable. My second point is that I believe the Government should encourage the use of government bonds for the payment of death duties. On this point I would go further than some others. Honorable senators have suggested in the past that Commonwealth bonds should be accepted in payment of federal estate duties. I believe that we should go further, and that the Australian Loan Council should be persuaded by the Treasurer (Sir Arthur Fadden) that every State Premier should introduce into the Parliament in his State, legislation to make State death duties and State succession duties payable by Commonwealth bonds at face value. It does not benefit the people whom I shall mention later, to know that these bonds will be available for the payment of federal estate duty only. Our receipts from federal estate duty, in a year, are about £10,000,000 or £11,000,000, which are obtained from a community of about 9,000,000 people. However, I believe that the raisings of the State Treasurers from death duties and succession duties are about £70,000,000 or £80,000,000, and consequently any suggestion that I shall make will have a far greater bearing in the field of State succession or death duties than it will have in the field of federal estate duty. The Federal Treasurer can give a direction to the States in this matter, a direction which 1 believes he should give, because when he attends meetings of the Australian Loan Council he presides at a body whose decisions mainly benefit the States. The Commonwealth draws relatively nothing from the fruits of Loan Council meetings, and, therefore, any amendment to ease the position of bondholders with regard to the payment of State death duties should be an amendment readily agreed to by the States. That is for the obvious reason that the results of any such amelioration will be to the benefit of the States, and the subjects of the States. lt should be possible for people to purchase bonds on the market and have them available after a certain time for the payment of death duties, both State and Federal, at their face value. If that were done, trustee companies, solicitors and others who advise people about death duties and estate affairs would become valuable agents for promoting the sale of bonds. There could well arise a great demand for bonds in those circumstances. I suggest that with certain reasonable safeguards that would be a valuable way of saving which should be encouraged in respect of people who are making provision for death duties at a later date. Any move in that direction would have far more significance if the bonds were made available for the payment of State death and succession duty as well as for the payment of federal estate duty. This suggestion is not new, because at one time it was possible to pay federal estate duty with certain Commonwealth bonds. Unfortunately, that system lapsed about fifteen years ago and has not been revived. I ask the relevant Minister to take this matter further on behalf of the Senate and to have it put forward strongly at the next meeting of the Australian Loan Council.
At the present time the Government, in its wisdom, provides an income tax rebate of 2s. in the £1 on income from Commonwealth bonds. I and other honorable senators have given some consideration to this matter, and we have arrived at the conclusion that the 2s. in the £1 rebate should be increased tor interest on other Commonwealth bonds according to their lower rates. If interest on bonds is received at the rate of 5 per cent., let the rebate remain at 2s. in the £1. If it is received at the rate of 4i per cent., that is, on bonds which have shrunk in value on the market, lel the rebate be 2s. 6d. On 3i per cent, bonds let the rebate be 3s. in the £1, and on 3i per cent, bonds let the rebate be 3s. 6d. in the £1. On the old 3i per cent, bonds, which have been called the “ Cinderella “ bonds, let the rebate rise to 3s. 9d. in the £1. I believe that a scheme such as that would give a new look to some of the “ Cinderella “ bonds, because it would become known that the income tax on the proceeds from those bonds would be less than on the interest from other bonds.
The Government should consider the possibility of granting bondholders the option of taking up loans carrying interest at variable rates adjusted periodically to the latest Commonwealth loan issue, but certainly with a fixed maturity date so that the Treasurer would know where he stood. That is not a completely unusual suggestion, because it should be remembered that in 1950 the Treasurer of the day was able to cut short the contract in relation to certain securities because he wanted to convert bonds which were then carrying interest at about 4 per cent, to securities carrying interest at a considerably lower rate. As he was contractually able to do so, he chose to cut short the period of the bonds. In the strenuous efforts that we should make to ensure that bonds become more attractive, we might consider doing something along those lines.
I welcome the income tax relief which is given by increasing the maximum allowance in respect of life assurance premiums. That is an imaginative step by this Government, i know that the Leader of the Opposition (Senator McKenna) ridiculed this provision by saying that it was such a small relief that it was not worth anything; but the main point is that it will encourage people to save more whether it be by way of superannuation, life assurance or anything else. That is a very good thing, and it will do justice to people in fairly high superannuation groups who also want to go in for life assurance. When the deduction limit was £200, many people were not able to claim as deductions amounts that they had actually saved in superannuation or assurance payments. The provision will do justice to many persons and, at the same time, it will encourage savings.
I now intend to make a further suggestion about taxation relief in order to promote savings. I believe that there could well be savings by deposit supported by taxation relief. After the war it was not possible, particularly for farmers, to buy implements which they needed for the regeneration of their properties, so it was made possible, at that time, for a primary producer to deposit with the Federal Treasurer - then the late Mr. Chifley - and the Commissioner of Taxation, certain cash. In that particular year they were entitled to claim that amount as an income tax deduction, and in the year in which it was spent it was added to their taxable income. It might be possible to encourage savings by allowing a deduction in the year of deposit, and then there would be the accretion to the man’s taxable income in the year of withdrawal.
– Would that be for farmers only?
– No, for all people. It would be applicable particularly to young people about to marry. They could deposit the money in the years prior to their marriage when they were earning good money and paying a higher rate of income tax, and after they marry and later have family responsibilities and consequently were paying a lower rate of income tax, they would withdraw the money and get the tax deduction. Such a plan would provide an incentive to put the money away, and the taxation deduction would be an attraction to support that incentive. Another valuable way to encourage saving would be to take a leaf out of the book of the Chancellor of the Exchequer of the United Kingdom. I have before me portion of his budget speech, delivered last April, and I propose to read an extract from it. These were his words -
I propose to give effect in a simplified and modified way to the recommendation of the second Millard Tucker Committee for relief of the selfemployed in respect of pensions for retirement.
This will grant relief from income tax and surtax within certain limits, in respect of premiums paid to promote a deferred annuity on retirement.
The relief will apply to professional men in practice, to individuals who are not companies, to controlling directors of companies, and partners, to employees who are not entitled to any benefit under the schemes set out by their employers, lt will be a condition of relief that the benefits secured by the premium shall be payable only as annuities and not as lump sums.
The relief will be limited to premiums not exceeding £500 or 10 per cent, of earned income in any one year. The cost to the revenue of this relief will be small in the first year, perhaps £7,000,000.
That figure must be read, bearing in mind that the population of the United Kingdom is about 50,000,000 - five times as great as that of Australia.
The Chancellor continued - but may rise to some £35,000,000- £40,000,000 in consequent years, according to the extent to which advantage is taken of the relief. But as I expect it- and I ask the Senate to bear in mind particularly these words of the Chancellor - to lead to a large amount of new savings, the effect on the economy should be the reverse of inflationary. The scheme covers a very wide range. The potential beneficiaries will bc very numerous. The self-employed themselves number 1,500,000. They range from the city accountant to the village grocer. There are many employees who are not pensionable. For all these the scheme will be a measure of fiscal justice. It will also increase the savings that we want.
As a corollary of this new relief, I propose to carry out a related recommendation of the Tucker Committee and to relieve from income tax the annuity fund of life assurance companies insofar as they represent invested premiums arising from deferred annuity business for the self-employed or from the re-insurance of approved superannuation funds. This will cost about £500,000 in 1956-57, but the cost will increase later.
There, in the United Kingdom, they have embarked upon this imaginative and bold experiment, and are doing two things. They are giving justice to that vast body of selfemployed persons ranging, as the Chancellor said, from the city accountant to the village grocer. These are people who do not come under civil service pension schemes or the superannuation schemes of the large companies - the poorer little business people - and also the professional men. It proposes a concrete scheme of retiring benefits for them so that they get the income tax deductions to a considerable extent while they are working. That is a strong incentive to go in for this scheme.
It was my privilege, about a week or two ago, to meet two honorable members of the House of Commons in this building. I discussed with one of them the effect of this scheme in England and he assured me that it was working excellently already, although it had been in operation only a few months. It has gripped the imagination of the “ forgotten “ people who do not participate in any superannuation scheme, and, as the learned Chancellor of the Exchequer predicted, it has led to a lot of new saving. As he said also, the effect on the economy should be the reverse of inflationary. I hope that the Treasurer will immediately give some thought to the United Kingdom legislation. The British Government did not rush into the scheme. The Millard Tucker committee sat in 1952, and since that time has given extensive thought to this plan. Australia could reap a quick benefit from what has been done in England.
I make a further suggestion, copying some of the things that were done during the war by the late Mr. Chifley. He issued war savings certificates which were bought for 16s., and after a year their value increased to 16s. 6d. and at the end of the next year to 17s. and so their value continued to increase annually. They were also tax free. The lift in value each year did not have to be included in the holder’s income tax return. There was a limit to the total value of certificates which one person could hold. At this time the Government, should consider a similar proposition, possibly lifting the interest on such certificates by 50 per cent, to make the value comparative with that of the war savings certificates at that time. None of these ideas should be brushed aside by the Government, because the more that we are able to save the less we will have to raise by taxation, and the less we have to raise in that way, the more there could be available for saving. The great nations throughout history have been those which put aside a little for a rainy day.
The Government should also consider exempting from taxation interest on savings bank deposits. Most savings banks limit deposits by one person to £1,000, and I suggest that the interest from deposits should be either tax free or taxed at a reduced rate. The people must be encouraged to save their money, whether by depositing it in banks or by buying bonds and certificates, &c. Australia’s company tax legislation may not be the best to promote savings, because it provides for a tax of 10s. in the £1 on undistributed profits. The purpose seems to be to force companies to distribute profits among their shareholders so that they can use them. Would it not be better to follow the pattern set by the United Kingdom, where a profits tax on reserves is, I believe, only 2½ per cent., whereas if the money is distributed, the tax is levied at the rate of 27½ per cent.? In other words, should not the Government turn its attention to the ploughing back of all profits, so that there may be further developments along those lines, rather than impose a tax of almost 10s. in the £1 on undistributed profits, thereby forcing the money out?
Those are some of the thoughts that I. pass on to the Senate this morning in connexion with the budget. By and large, I believe that the budget will have a steadying effect, although, obviously, there are matters associated with it that call for some regret. There are, for instance, shortages in the granting of benefits that we would like to see granted. Indeed, we would all like to see greater benefits in a number of directions granted to the people of Australia, but I feel that the zest for attainment of those benefits at the present time, as indicated in the budget and the legislation that will arise from the budget, should cause the people of Australia to do some of the basic things that should be done. I mention, particularly, for consideration by the Government, action that could be taken to promote greater personal savings by the people.
– The paltry diatribe which Senator Laught has just inflicted on the Senate is, in my opinion, out of place in a budget debate. The honorable senator spoke on behalf of the wealthy members of the community only.
– In what class is the honorable senator himself?
– I shall deal with those engaged in pearl fishing later. Senator Laught, as I have said, dealt mainly with the wealthy members of the community. Although he was engaged in a budget debate, or in what is alleged to be a budget debate, he had nothing whatever to say about the average member of the community. He was concerned only with Commonwealth bonds and stocks, which he wanted to be made more attractive to investors. I am concerned to know how the average member of the community, under present-day conditions, can possibly save £100 to invest it in a Commonwealth loan. In that respect, the honorable senator’s speech was a failure, and not in keeping with a budget debate.
– Has the honorable senator seen the latest figures regarding savings bank deposits?
– I shall deal with that matter later. There is a history associated with them which I shall expose later. We acknowledge as a fact that every budget contains something of interest to every member of the community, because a budget speech is supposed to contain the financial and economic policy of the government in power at the time it is delivered. Ever since the present Government came into office, in 1949, it has failed to present to the Parliament a sound financial and economic policy. I ask for leave to continue my remarks at a later stage.
Leave granted; debate adjourned.
Debate resumed from 5th September (vide page 96), on motion by Senator O’Sullivan -
That the bill be now read a second time.
– This is one of a series of customs tariff bills that are before the Senate, and, with the concurrence of the Senate, I propose to refer very briefly to all of them at this stage, as that would save time. My first observation in regard to all these bills is that the Opposition does not intend to oppose their passage. It would be difficult in any circumstances to do so, because all the tariff proposals are already in actual operation, and, indeed, some of them have been in operation for about twelve months. Obviously, it would be impossible to retrace what has happened in the intervening period.
I understand that all the proposals have the support of recommendations from the Tariff Board. I agree with the remarks of the Minister for the Navy (Senator O’Sullivan) in introducing these measures that it is the general practice of the Parliament to accept those recommendations without very much question. There is one. measure, however - Customs Tariff (Papua and New Guinea Preference) Bill 1956 - which provides for preference being given to the importation into this country of timber from Papua and New Guinea, concerning which a number of honorable senators on the Opposition side are particularly concerned, and 1 have therefore suggested to the Minister that one of my colleagues might be given the opportunity to secure the adjournment of the debate on that measure although the Opposition will permit the speedy passage of the other . measures. Both Senator Aylett and Senator Poke, the latter of whom was at one time secretary of the Timberworkers Union of Tasmania, and has a particular knowledge of the timber industry, wish to have further time for consideration of the measure, and will address themselves to it later. The Minister has been good enough to concur in my request that that course be taken. So far as the other bills are concerned, I have no further comment to make.
– Item 329 deals with leather boots and shoes on which an additional tariff is proposed. This item has concerned me for some time, largely because it is now impossible to have a pair of boots or shoes made to order as it was some years ago. To-day, a person who needs a pair of boots must be content with boots which most nearly meet his requirements, with the result that he has to be satisfied with an inferior article. There was a Tariff Board inquiry into boots and shoes in 1935 - more than twenty years ago - and at the time one of the reasons given for higher duties was that local boot manufacturers feared the competition of the British Bata Shoe Company Limited of Czechoslovakia. In that report of the Tariff Board the board stated -
Bata’s venture in the United Kingdom can only be successful because of superior efficiency. The Board considers it reasonable to assume that, following the practice of the past, Australian boot and shoe manufacturers will not fail to take advantage of all possible improvements and developments, and feels confident that the Australian industry is quite capable of successfully meeting competition of this nature.
One would think that, in view of those remarks by the Tariff Board, local manufacturers of boots and shoes would have done something to meet competition but, surprisingly enough, twenty years later the same fear of competition from the Bata company is again raised as one of the reasons why local manufacturers should be given greater protection. In its report for 1955, on page 11, the Tariff Board says -
The fear of competition was almost entirely in respect of footwear from the United Kingdom and particular fear was felt regarding the products of the British Bata Shoe Co. Ltd. That company is a member of the world wide Bata organization which originated in Czechoslovakia and, through the use of mass production methods and special machinery, has been able to undersell other manufacturers of low and medium grades of footwear. So far importations into Australia from Bata have been negligible, although in New Zealand the organization appears to have become firmly established as an importer and, it seems, as a manufacturer.
Therefore, over the whole twenty years that company has not affected the industry in Australia to any extent. Indeed, it is very interesting to note that the Tariff Board states that the Australian industry is able to meet the demand and that imports generally consist of boots and shoes of a very high grade from Italy which range in price from £12 to £14 a pair. They are boots and shoes of types that are not manufactured in Australia. About twelve months ago I was fortunate in buying a pair of English-made shoes which were soled with specially prepared leather. Although I have been wearing them for twelve months there is hardly a scratch on them. I venture to say they will last for at least three years whereas locally-made shoes rarely last six months without being repaired.
By putting up the duty we are causing our own consumers to pay a higher price. Within three weeks of this tariff resolution being tabled in the House of Representatives the price of boots and shoes went up 5s. a pair. By increasing the duty we are only forcing our own people to use shoes or boots that are not of the quality of the imported articles. I have here some very interesting figures to show the effect that imports have on the local industry. In 1951-52 local production totalled 16,794,648 pairs of boots and shoes whereas imports totalled 1,009,579 pairs. In the following year, our manufactures dropped by 400,000 pairs to 1 6,2 1 1 ,500 pairs and our imports dropped to 77,000 pairs. The following year, 1953-54, our manufactures went up to 17,885.848 pairs whilst the imports were only 232,334, or something like .03 per cent, of the total boots and shoes manufactured. Imports are negligible. As the Tariff Board pointed out, our manufacturers are able to meet the demand.
From the board’s report we also find that there are 35 manufacturers of footwear of all types. Of those, nineteen produce leather footwear. The net funds employed by those nineteen firms were £1,658,019 in 1951. Sales in that year amounted to £5,343,222 and the net profit to £245,108, or a net profit in relation to the funds employed of 14.8 per cent. The following year, 1952, the net funds employed were £1,759,826; sales amounted to £6,327,062, and the net profit was £238,799, or 13.6 per cent, of the funds employed. In the following year, the net funds employed amounted to £1,624,200, sales to £6,716,759 net profit to £266,259 and the profit per cent, was 16.4 per cent. That is a very reasonable profit, in my opinion.
Dealing with the kinds of shoes and boots manufactured, in the high grades of men’s and women’s shoes - not the type imported from Italy ranging in price up to £12 or £14 - we find that in 1951 the percentage of net profit to funds employed amounted to 19.4 per cent., in 1952 to 18.3 per cent, and in 1953 to 23.1 per cent. For ordinary grades of men’s and women’s shoes produced in 1951 the profit was 9.5 per cent., in 1952 it was 12.8 per cent., and in 1953 it was 8.7 per cent. In respect of youths’, maids’ and children’s shoes the percentage of profit in 1951 was 15.9 per cent., in 1952 it was 6.6 per cent, and in 1953 it was 14.4 per cent. The Tariff Board based its recommendation of an increase in duty on the fact that in respect of ordinary grades of men’s and women’s shoes the net profit on funds employed amounted to 9.5 per cent., 12.8 per cent, and 8.7 per cent, for the three years respectively. It has fallen from 12.8 per cent, to 8.7 per cent, in the one year, but 1 maintain that three years is not a sufficiently long period to take in this respect. In each of the figures I have quoted, with the exception of those for high-grade shoes, there has been a fluctuation. Before the Tariff Board makes a recommendation for a rise in any of these matters, particularly when the increase is going to affect our consumers, a longer period than three years should be taken in considering profit levels. However, because the profit fell in one particular line, a rise in duty has been recommended.
Of course, if it were a matter of ensuring the stability and efficiency of one of our own manufacturing industries, I would be cordially supporting the increase, but I maintain that when a manufacturing concern has been established over a period of twenty years there should be a gradual reduction in tariffs in order to promote efficiency in the industry.. That is the way the English trade met the Bata competition, and that competition was much closer to Britain than it is to us. British firms met it by increasing their efficiency. That was the advice the Tariff Board gave to the people concerned, to increase their business efficiency and thus render it unnecessary to give this continued tariff protection which only has the effect of raising the price of the article to the consumer. I know of an instance - I may have mentioned it before - when some years ago a manufacturer was not able to get delivery of one of the necessities of manufacture and he had to put off 200 men. Before he put them off he was turning out 3.5 per cent, of a particular article. After he put them off he was turning out 5.2 per cent, of the article. In other words, he obtained more efficient work from his employees because they feared they might be the next to be put off. That is what we have to do. The organization I have in mind was not a particularly large one; it may have employed 400 or 500 people. An organization could not be described as being efficiently managed if it employed 200 surplus men. It is high time the Tariff Board made some move to see that manufacturers meet competition by improving their efficiency so that there can be a reduction of duties and also a reduction of price to consumers. The Government is continually asking people to reduce costs of production. There are many ways in which the Government could assist in reducing the costs of articles to the consumer, and one is by the progressive reduction of tariff duties. As establishments become secure in their business, they should be able to meet the competition which young establishments obviously cannot meet. Young establishments must be protected.
I direct attention to this particular increase because I think it has been granted unwisely. As far asI can find out, no possible cause exists, because the competition the industry feared in 1935 did not eventuate, and the industry has developed in. the intervening twenty years. By increasing, the duty, we are forcing the Australian people to purchase inferior articles at a higher price.
Question resolved in the affirmative.
Bill read a second time, and passed through its remaining stages without requests or debate.
Debate resumed from 5th September (vide page 96), on motion by Senator O’Sullivan-
That the bill be now read a second time.
Question resolved in the affirmative.
Bill read a second time, and passed, through its remaining stages without requests or debate.
Debate resumed from 5th September (vide page 96), on motion by SenatorO’Sullivan -
That the bill be now read a second time.
Question resolved in the affirmative.
Bill read a second time, and passed through its remaining stages without requests or debate.
Debate resumed from 5th September (vide page 97), on motion by Senator O’Sullivan-
That the bill be now read a second time.
Debate (on motion by Senator Aylett) adjourned.
Debate resumed from 5th September (vide page 97), on motion by Senator O’Sullivan -
That the bill be now read a second time.
Question resolved in the affirmative.
Bill read a second time, and passed through its remaining stages without requests or debate.
Debate resumed from 5th September (vide page 99), on motion by Senator O’sullivan-
That the bill be now read a second time.
Question resolved in the affirmative.
Bill read a second time, and passed through its remaining stages without requests or debate.
Debate resumed (vide page 154).
.- 1 shall now continue my speech until I am once more interrupted. Almost every Australian citizen has an interest in the Commonwealth budget because the Commonwealth is now the dominating force in financial matters in this country. I was greatly amused when I read the criticism of the budget in the metropolitan press of Australia. In one way or another, a Commonwealth budget affects every individual in this country. It improves the economic status of some, and adversely affects that of others. On the day following the bringing down of the budget, the press had nothing good to say about it. Why was that? I do not say that the press always has good things to say about a budget, or about a government, but on this particular occasion there was nothing very good at all in the budget, and I know very well why the press adversely criticized its provisions. As we know, the press - particularly the metropolitan press - in three or four States is associated with television. Within the next three or four months, newspaper interests will be operating television, and inside three or four years they will have a stranglehold upon television in Australia. Their main concern was about the £7 excise on the cathode-ray tubes. They had no interest at all in the welfare of the people of Australia. The sole thing prompting them to say anything at all was this charge on the cathode-ray tubes.
Upon reading the press, one might gain the impression that the Treasurer was the sole person responsible for the budget. The
Government seeks constantly to keep the Treasurer before the eyes of the public so that if there is any complaint about the budget people will tend to blame the Treasurer personally for it. We know, of course, that, poor as it is, the budget expresses the weak financial and economic policy of the Liberal party. I have said on previous occasions that the Australian Country party is the mangy dog for the Liberal party to kick at its will. If there is anything unpleasant to be done, the Australian Country party is called upon to do it. On this occasion the whole of the criticism is levelled at the Treasurer because he happens to be a member of the Australian Country party. But the people of Australia are no longer misled by that type of propaganda. They know only too well that whatever may be put forward by the Treasurer it is something which has been cooked up by the Liberal party. He is merely the catspaw of the Liberal party in Australia. I do know that had the Labour party been in power last year and introduced a budget similar to the one brought down then, the press of Australia would have sought all possible means of removing the party from office.
The budget under discussion follows the introduction only a few months ago of what has been called the little budget. That little budget seriously affected many small manufacturers and businessmen in Australia. I know of my own knowledge that many small manufacturers have found it extremely difficult to carry on their businesses since the introduction of that budget, and especially since the introduction of import restrictions. I know of many that are on the point of closing down. I know of many small manufacturers employing from fifteen to twenty hands and who are now unable to obtain the raw materials necessary to manufacture the articles which they have been producing over the years. Perhaps the Government gloats over that fact. I think it does. It might look upon that as good economic policy. It is certainly consistent with its attitude over the years for we all know that ever since it has been elected it has always stood for the big money interests in the community, for the shipping combines, private bankers, cartels, middle man profiteers and so forth. Always, when it comes to deciding between the welfare of the people and pandering to the money interests of the country, the decision is in favour of legislating for the benefit of the moneyed interests. It is not surprising to see that no relief is provided in the present budget for the smaller people.
This budget merely re-enacts the little budget introduced a few months ago. That little budget is now to become a permanent part of the financial and taxing structure of Australia. The unusual taxation which was levied under the provisions of the little budget will now become the commonplace throughout the industrial and commercial life of Australia for years to come or until this Government is defeated. The extraordinary will become the commonplace. I have said repeatedly here and outside the Parliament that the Menzies-Fadden Administration has never had a financial or economic policy extending beyond a period of three or four months ever since 1949. It has always relied upon something to tide it over a particular point, but which has led to further difficulties. I invite any honorable senator to tell me what the exact position will be at the 30th June next. I invite the Government to show me how its present negative policy can be connected in any way or lead in any way to anything solid for the commencement of the next financial year. By this budget, the Government is simply eliminating a channel upon which we could travel soundly and firmly financially for the next five months. I cannot be convinced that this budget contains any semblance of sound financial policy. This Government is merely following its usual practice. It is merely seeking to pass from crisis to crisis or from movement to movement. Ever since it was elected, it has relied upon the high price of wool to carry it through. It knew once the price of wool commenced to soar that it did not require to adopt any sound financial policy. It knew that the taxation revenue resulting from the high price of wool would be sufficient to tide it over from time to time, and that is how it has carried on.
Now we come to another stage. I have pointed out time and again that the economy of Australia has been changing rapidly from simply agrarian to both agrarian and industrial. The Government does not seem to appreciate that. It does not realize that it now becomes necessary to formulate a sound policy to meet changing conditions. We have had all sorts of economic statements from the Treasurer, the Prime Minister and the lesser lights of the Government, but they all deal with the one subject, lt has become nauseating to either hear or read these statements. Often the Prime Minister might say something which is repeated by his followers. For instance, he might say that there is a boom in consumption expenditure. We have heard that said time and again. I have never been able to understand what was meant by a boom in consumption expenditure. Do Government members mean that people are spending money upon goods which can be consumed and that as a result of this boom in expenditure on consumption goods the people have attained a higher living standard? If Government members believe that, they are merely deluding themselves. The position purely and simply is that we are suffering from inflation. There is actually no boom in consumption expenditure at all. Let us consider this so-called boom, and compare the value of the £1 when this Government was elected to office in 1949 with its value to-day. The £1 is worth now only 6s. or 7s., and inflation is still rampant. That is the boom that supporters of the Government talk about.
Reference has been made by honorable senators on the Government side to private investment. I often wonder whether they are in favour of the principles espoused by their own political parties. There must be some provision for private investment in the community because the means of production are in the hands of private individuals. Companies, and their operation in Australia, were discussed at some length this morning. Supporters of the Government implied that supporters of the Australian Labour party were opposed to public companies. We know that they exist, and we understand their place in the economy. We know that they are connected with major industries and that, in present circumstances, we cannot do without public or private companies. If they have to expand their plant and improve their manufactures, the money they spend is classed as private expenditure. If our society as it is now constituted is to progress we must have expansion of private investment. The population is growing and production must keep pace with it.
I honestly believe that supporters of the Government do not know what they are talking about when they discuss these matters. They speak of over-expansion of credit: They are afraid to grant credit for essential industries. They have closed down on financial advances. I recall when the Defence Preparations Act, which had 52 clauses in the preamble, was introduced in this chamber. That measure was introduced, not for the purpose of preparing Australia to meet war-time conditions, but to enable the Australian Government to control capital issues. It wanted to -put that control beyond all doubt, and to stop the over-expansion of credit. Surely a man who conducts a business knows whether he is on a safe financial margin or not. Surely there are officers in the Commonwealth Bank who can assess the amount of credit that can be given to an individual who wants to expand his industry. Although supporters of the Government have stated repeatedly that they do not believe in any form of control or restriction they are constantly practising restriction in one form or another.
The Government has stated that the hirepurchase business is expanding too rapidly in Australia. I am old-fashioned, and I am opposed to hire purchase to a certain point, but we know that there are many people in Australia at the level of poverty, and if they did not have the facility to buy some of the amenities of modern civilization through hire-purchase arrangements, they would never get them. My objection is to the high rate of interest that is charged by the extortionists who control hire purchase companies. One big retail firm operating in Australia has formed its own hire purchase company. After that company had operated hire purchase agreements for about twelve months, it paid a dividend of 10 per cent. The profit was extracted from the people by lending money to them to buy goods. Then the retail firm was able to pay a dividend of nearly 20 per cent, out of its profits.
– The honorable senator said that the company paid a dividend of 10 per cent.
– It paid 10 per cent, on hire purchase business. Senator Scott knows, as I do, that the great retail shops pay anything from 20 per cent, to 25 per cent, dividend on their capital. That is one of the most lucrative forms of business. I was amused to read criticism of the budget in the metropolitan press of Australia. It published comment by big business, and allotted a great deal of space to that section of the community, but consumers, who could not buy a potato, were not given an opportunity to speak.
We recall that, in 1949 and 1950, there was a lot of talk by supporters of this Government about putting value back into the £1. The people were asked to support the Government so that it could solve the problem of inflation. I am concerned constantly about the average citizen. I am not worried so much about the wealthy people, because they can look after themselves and can conduct their businesses in such a way that they will be all right in the end, but what of the little man? Last July, the Commonwealth Government increased the price of butter by Hd. per lb. At the same time it arranged, at the request of those who support it in and out of season, to give a subsidy of £14,000,000 a year to the dairy farmers of Australia. No supporter of the Government can justify that action. First, the Government charged the people of Australia Hd. per lb. more for butter, and in this budget it is granting to the dairy farmers, the most backward political group in the community, a subsidy of £14,000,000. I challenge honorable senators on the Government side to refer to that matter during this debate.
Only a fortnight ago, the price of bread was increased in Victoria by 2£d. a 2-lb loaf. This Government then brought in legislation to give the wheat-growers so much a bushel. The Government said this money was to cover working expenses. I know very well that the wheat-growers can tinker with their costs in such a way that they can make them appear to be inflated and more than they actually are. The Government is granting the wheat-farmers a price for every bushel of wheat. Although there is a surplus of wheat throughout the world, the price of bread is increased. Then we find supporters of the Government standing in their gowns of hypocrisy and talking about supply and demand. If that law operated now, the price of bread would be 2id. or 3d. a 2 lb loaf, which would be absurd.
– You voted for the wheat stabilization legislation.
– Yes, because we would not oppose the Government’s measure. As well as that, a sum of £3,000,000 was made available for the construction of silos and sheds in which to store the excess wheat. When I consider the humble spud which has assumed such great importance in Australia, 1 find that its price has soared to more than £170 a ton. When I commented upon the price of potatoes a few months ago, one honorable senator, on the Government side said that if the people did not want to buy potatoes they did not need to buy them. Of course, honorable senators on the Government side like to think that the price of potatoes is continually rising, but I shall tell them a fact or two about that. The interjection to which I have referred was the most ignorant one that has ever been made in this Senate. The ideas of honorable senators on the Government side about . the liberty of the subject, liberalism and philosophy of life come down to the belief that this is a great, free country, and if you cannot buy boots, you can go barefooted. They believe that if people with large families cannot buy potatoes they can go without.
Senator Maher made the interjection to which T have referred, but I am sure that when he interjected he did not know that potatoes are an item in the C series index. Therefore, whether people purchase potatoes or not, the price of that vegetable is considered by the Commonwealth Statistician, when he determines upon the C series index. Those governments throughout Australia which have rightly observed the fluctuations of the C series index in their basic wages during the period of inflation in this country, so ensured that people would be able to purchase the basic items mentioned in the C series index. There will be another increase of the index within a month or two, and I believe that the increase will be not less than 3s. 6d. per week. Honorable senators can calculate what that will mean to the employers who will have to pay the increased wages, mainly because the primary producers of Australia are falling down on their responsibilities and obligations to the people. They have the land and equipment to produce potatoes, but they do not produce them. I know that Senator Wright, who appears to be trying to interject, is a very smart man, and that in the near future he will be the Attorney-General. I shall be surprised if he does not occupy that position, because he is, perhaps, one of the most able men on the Government side.
I represent a State in which 77.4 per cent, of the people own their own homes. I stand for home ownership, and am always pleased to hear of more people becoming home owners day by day and week by week. To 30th June last, many homes were erected from loan advances made by the Commonwealth to the States at a rate of 3 per cent, interest. That transaction was carried out under a housing agreement introduced in 1945 by a Labour government. This year, the interest rate of 3 per cent, was increased to 4 per cent., and yet we continue to talk about prosperity and the expansion of the production of consumer goods. Under this new agreement, the Australian Government is practising extortion towards potential home owners by increasing the rate of interest on the money advanced to the States to 4 per cent. The effect of the increased interest rate is that a person who builds a house which costs £2,750 will be required to pay an extra 8s. 8d. a week off his principal and interest. Who is to meet the extra cost of the average wage-earner who occupies a house which cost about £2,750 to build?
During recent years our economic position has changed considerably. In 1939 when the basic wage was £4 4s. a week, a borrower could have obtained £1,000 for the erection of a timber house, repayable over twenty years with interest at 4£ per cent, per annum. On that loan the repayment would have been £1 9s. 3d. a week. At the present time, with a basic wage of £11 17s. a week, a borrower may obtain £2,400 to build a timber dwelling, repayable over 45 years at 4i per cent, interest, the weekly repayment being £2 7s. lOd. That £2 7s. lOd. is an economic rental calculated according to a formula devised by the Australian Government. Even a wageearner on a fairly high salary finds it difficult to pay out that rent each week for his home. Only those who have had to pay rent during the course of their lives know what an impost it is upon their earnings every week. It is a dead payment. Yet that is the situation before us to-day. The whole of our circumstances are changing, and no improvement will be effected by anything that the Government proposes to do in the budget. As a matter of fact, the budget will make our position worse.
To-day the Government is creating conditions which will cause costs to rise still further, and it is quite obvious that having increased the rate of interest on loans to States a further impetus will be given to increasing costs. When we consider costs we must consider rates of interest, freight and other charges as well as wages, and the small amount of money made available to the States this year for home building is totally inadequate and will not allow anything near the number of houses to be built that the people of this country require. The Government is proceeding apace with its immigration policy, and I have nothing to say against that, at this stage, unless the Commonwealth Government assumes fully its responsibility in respect of immigration. At the present time, it is not making available to the States sufficient funds to allow them to cope with increase of population. It is common knowledge that migrants coming to Australia do not represent a labour force only; they are an economic force. They have to be provided for, and because the majority are married homes have to be found for them. There must also be community services and telephones, and industrial plants and other amenities have to be increased. The economy is changing all the time while we are bringing immigrants into the country.
At question-time this morning, mention was made of levels of employment, and I warn the Government that on the day that it decides to discontinue bringing migrants to Australia, mass unemployment will once more begin. On the day that the housing problem is solved in Australia many workers will go out of employment. At the present time, there is a great housing shortage throughout Australia, and notwithstanding the meagre funds for home building made available to the States by the Commonwealth or from the resources of those who finance home-construction from time to time, there is still a great lag in housing. If that were overcome, what would be the situation? Every one knows that to build brick houses, bricks are required, and bricks are made from clay. The men in the clay pits would be idle, also those in the brick kilns, and the carriers who cart the bricks to the various towns where houses are being built. In the case of wooden houses, the building begins with the tree-fellers and hauliers, the men employed in the saw-mills, and the carters. There are also those employed in joinery works where doors and windows and such things are made. In other factories, metal fittings for windows and other parts of the house are manufactured. Other workers are employed in making glass for windows. If home-construction ceased, all those workers would be unemployed. The building tradesmen would all be affected also - the carpenters, bricklayers, plasterers, plumbers and painters - as well as the great body of labourers who assist them. One thing which lifted Australia out of the sorry mess it was in after the last depression was the revival in the building industry. If ever a recession comes in the building industry, this country will again have to provide for a large mass of unemployed. If the Government wishes to improve the employment situation in Australia it has only to step up immigration. On the other hand, if it wishes to have unemployment on a wide scale, it has only to curtail the present activity in the building industry. 1 am greatly concerned over the prices which people have to pay for the necessaries of life. These are increasing day by day. and there appears to be no way in which they can be effectively prevented from rising further. The Government may have scruples about introducing prices control. When a proposal to give the Commonwealth power to control prices was put before the people of Australia in 1946, the Liberal party opposed it strongly and bitterly, and has maintained that attitude ever since. That party would like to reduce wages also. Only recently, a conference was held in Canberra between the Acting Prime Minister (Sir Arthur Fadden) and the State Premiers to consider a Commonwealth proposal for pegging the basic wage in the various States, or to bring them into line with the Commonwealth base rate. I read the fifteen-page document which was presented to that conference by the Commonwealth Minister for Labour and National Service (Mr. Holt), and the whole purport of it was that the governments and the courts should noi recognize the increases reflected from time, to time in the C series index.
– What did the Minister recommend?
– There was no recommendation.
– There was.
– I would say that there was no definite recommendation because the matter was submitted for discussion only. The Minister began by referring to the first basic wage ever fixed in Australia by Mr. Justice Higgins, and then traversed the history of wage fixation to the present time. His whole argument was that wages should be held at the present rate.
– He wants to stabilize them.
– That is so. I remind the Senate of what happened when the Commonwealth did fix prices and the basic wage rates of the various States of the Commonwealth. We are not without experience. On one occasion I said in this chamber that it was this Government which had stopped the operation of the C series index in relation to Commonwealth awards, and I was taken to task for doing so. I was told that the Commonwealth Government had nothing to do with it because that was an action of the court. I am not Alice in Wonderland or Blunderland. and I know how these things happen. One of the weaknesses of the arbitration system is that arbitration courts do lend an ear to governments and give effect to the policy of governments.
Price-fixing was introduced about 1939, and in that year the basic wage in Queensland was £4 4s. a week. In August, 1943, four years later, the basic wage was increased to £4 17s. Price control had been in operation all that time, and the basic wage was increased by only 13s. a week - and those were war years. No honorable senator can tell me that there was any discontent among the workers during that period. Wages were fixed also, during that period, according to living costs, and they were kept at a safe margin. There were no strikes, and there was no talk of striking, during that period, and there was greater contentment among the workers then than there is at present. It is not possible, nowadays, to read any newspaper without seeing a report of some group of workers threatening to go on strike, or actually striking because of inadequate wages. Many of the men are accustomed to observing rules and regulations which apply to every minute that they are in employment. It is hateful to them to do anything which is contrary to the rules which have been laid down. They find that the struggle, to maintain life is far worse to-day than it has ever been. Notwithstanding the facilities that are provided by way of hire purchase and otherwise, the struggle to live is getting keener every day. In saying this I know what 1 am speaking about.
– Are we in a depression?
– If the honorable senator has any young children I suggest that he should ask his wife of her experiences which trying to buy shoes for them. He should ask her what she has to pay not only for boots and shoes, but also for other articles of clothing. He should ask any citizen with whom he comes in contact what it costs to buy school clothes for his children. The situation is alarming. I am referring not to the prices charged for luxury lines of clothing, or for fashionable millinery for wealthy ladies, but to the prices charged for everyday goods such as school clothes for children, and essential clothing generally. Those are the articles the prices of which are reflected in the basic wage. There is still price-fixing in operation and I shall give some particulars of increased costs. We were told that in 1949, when there was a change of government, there was a measure of inflation in Australia. Let us accept that as a truthful statement. All this is reflected in the movement of the basic wage. I am confident that there is a definite relationship between the operation of the C series index and the basic wage, and values generally throughout the Commonwealth. Even the values of property are fixed according to the basic wage. The basic wage has an undisputed influence in the community; it influences rents and freights, and even the charges made by professional men for their services. From 1943, when wage fixing was set in operation, until 1949, when Labour went out of office, the basic wage rose from £4 17s. to £6 9s. a week. That was a small increase during that period. My point is that if the Commonwealth Government adopts a policy of price-fixing for essential commodities the economy of Australia as a whole will be stabilized. Such a policy would stabilize wages and values generally throughout the Commonwealth. But if the Government lacks the courage to do so, further inflation will be inevitable. Yesterday, the Minister for the Navy (Senator O’sullivan), speaking in this chamber, referred to a basic wage of £14 a week. The honorable senator is the Leader of the Government in this chamber but 1 tell him that in no State is there a basic wage as high as £14 a week, and that that rate is far above the Commonwealth basic wage. In Queensland the basic wage to-day is £11 17s. a week, but I am confident that it will be increased by October. > Honorable senators opposite tell us that in 1949 when the Labour Government was in office, the age pension was only £2 2s. a week, whereas to-day it is £4 a week. Such a statement is meaningless, because we cannot compare conditions to-day with those of 1949 simply by mentioning the rate of social services payments and disregarding the value of money - what money will buy. A pension of £2 2s. a week in 1949 bought more essential goods than £4 a week will buy to-day.
The same argument is repeated in various ways. I have before me figures relating to the national income and expenditure for 1955-56. The national income in 1948-49 is shown as £1,945,000,000, whereas for the financial year 1955-56 it was £4,312,000,000. Notwithstanding those figures, there was not a substantial increase of the national income during those years. Those are only figures. What we ought to do is to compare what the £1 would purchase in 1949 with the few goods that £1 will purchase to-day. Such arguments are a form of hypocrisy. A similar condition of affairs is revealed when we study the amounts paid to the States by way of income tax reimbursements. In 1950-51, under the formula and the taxation structure which operated at that time, the amount refunded to the States was £70,398,000. To-day, the refund to the States is more than double that amount; the estimate in the budget before us is £153,600,000. But is there one citizen in the Commonwealth who will say that, whereas the State governments will receive £153.600,000 this year compared with £70,398,000 in 1950-51. the States can do more with the money and provide more services than they could provide in 1950-51? The contrary is true; the States are finding it more difficult to carry on, and they are curtailing services which they have carried on for many years. That is because of the inflation which this Government has allowed to go unchecked. I remember the Hallelujah chorus that was sung on 3rd April, 1953, when it was announced that the industrial court had made static the basic wage and suspended increases under the C series index. . Every supporter of the Government at that time approved that action. Of course, we on this side expected them to do so, because it is the policy of the Government, which believes in communism, to create conditions which will spawn communism and Communists. The Government ‘ and its supporters deny that they are the allies of the Communists, but we know that they stand for communism and unhesitatingly produce conditions which lead to unemployment which is the hotbed in which communism geminates. Without any compunction whatever they do things which encourage the growth of combines and cartels, and produce conditions which lead to the permanent unemployment of a large section of the people. Yet they have the hypocrisy to talk about socialists. Do these people send their children to universities? I wonder whether they do. If they do, those children are getting a socialist education. Governments pay 75 per cent, of the expenditure incurred by the universities of the Commonwealth. Only 25 per cent, of that cost is derived from fees. How do governments obtain the funds they make available to the universities? Only by sales tax and by generally taxing the working people of Australia. That cannot be denied. Honorable senators opposite are hypocrites when they say they are opposed to socialism. Similarly, they profess to believe in private enterprise but, at the same time, they take money out of the coffers of the Commonwealth Treasury - this year an amount of £14,000,000 - and pass it over to that very backward group in Australia, the dairyfarmers, in order to subsidize their industry.
This budget contains no policy; it is the worst budget that has been introduced into the Parliament. The Government is rapidly on the way out and, speaking on behalf of the average citizen of this country, I say the sooner its demise takes place the better it will be for Australia.
– I listened carefully to Senator Benn make his speech in this budget debate and I commiserate with him on his feeling of despondency. During the whole of his speech he never said anything of a constructive nature. All he did was condemn the Government and say that the sooner it is out and Labour gets in the better it will be for this country. He also said that the worst type of people in the country to-day are the farmers, and that the dairy-farmers are the lowest grade of all farmers. I remind him that the farmers or this country are to-day doing a better job than has ever previously been done by primary producers during the history of Australia. Let us compare production figures in 1952 with production figures to-day. We find that the dairy-farmers in 1952 produced 120,000 tons of butter-fat compared with the estimate for 1956-57 of over 200,000 tons. That increase has taken place in the space of a few years. When we look at the wool production figures we see that this year the production will be 4,500,000,000 bales - a production record. This has all been brought about by this Government and by the help it has given to producers through taxation concessions. We have done that in order to increase production and we see the desired result in Australia to-day.
The honorable senator said that the only cure for our problem of rising costs is to revert to the 1949 price-fixing controls of the Chifley Labour Government. He said that if we re-introduce price-fixing as it applied then, we should be able to stabilize wages. He cited a lot of figures, but honorable senators will remember that in 1949 if any person in Australia went into a shop to buy a pound of butter which was rationed-
– It was not rationed in 1949.
– In 1949 it was rationed. If he went into a shop he could buy butter with coupons at the fixed price of 2s. lOd. per lb., but if he bought it from under the counter without coupons he would pay up to 6s. per lb for it. Tea and sugar were also rationed, and honorable senators opposite cannot deny that petrol was rationed in 1949. If one went along to ft bowser in 1949 to buy petrol he had to produce coupons in order to buy a certain number of gallons. Those were the conditions that existed in 1949. If a person wanted to buy a washing machine, a refrigerator, a sewing machine or a motor car he had to go along to the people who sold them and put his name on a list and wait until they became available. Prior to the general election, when we on this side became the Government we said in our policy speech that we would do away with petrol rationing if we were returned. On 10th December, 1949, we won the election and by March 1950, petrol rationing was a thing of the past, and it has never been re-introduced despite the fact that the ‘ Labour party said that it was impossible for any political party or any government to . abolish petrol rationing. Within three months of this Government’s election, the late Senator McLeay, who was the Minister in charge of fuel, managed to bring in sufficient petrol from sterling areas to enable this country to abolish petrol rationing and, at the same time, maintain all the stocks needed for our defence. We have never looked back since.
Let us consider how the Labour party looked after the workers. In 1949, how many workers had a washing machine or a refrigerator? To-day, 90 per cent, of the workers have those facilities which could never have been provided by a Labour government because it stifled everything. Nobody in Australia could make anything under the Labour government because they could not obtain the raw materials such as iron or steel.
– We were at war.
– We were not at war in 1949. The Labour Government did not increase the production of coal; it did not increase the production of steel, or iron, but as soon as this Government came into power we set about increasing the supply of those materials. We even had to import coal from Africa, or India, in order to get our furnaces going so that we could manufacture steel which was vitally necessary as a component part of a refrigerator or washing machine. We did that so that the workers of this country could get those facilities which every person in Australia should have. The party opposite had no idea how it was going to bring about such a state of affairs. All it said was that it would consol prices and that control of prices was the -answer to everything. Of course, we could re-introduce prices control, but would that be the answer to the present difficulties? The States, which have the power to control (prices, have tried to do so and have failed. As an honorable senator mentioned yesterday, interest rates in New South Wales run as high as 20 per cent. Although it is within the power of the New South Wales Labour Government to control interest rates in that State, it has failed to do so. In fact,’ that Government is keeping very quiet about the matter. If the control of prices was re-introduced by the Common”wealth, how could we avoid black markets such as those that existed in 1949?
– The black marketeers could be gaoled.
– The Labour Government did not put them in gaol in 1949. In New South Wales, at that time, hundreds of shop-keepers kept certain goods under the counter. If a person had sufficient money, he could buy any amount of cigarettes and other commodities. That is the condition of affairs that Labour would like to see brought back to Australia, but the people of this country will not stand for it. This Government does not believe in prices control but, nevertheless, it has offered to make available to the State governments one of its senior officers to assist them if they desire, to re-introduce prices control generally. But, as I have said, this Government does not believe in it and will have nothing to’ do with it. Apparently, Mr. Cahill, the Premier of New South Wales, does not favour prices control. All that honorable senators opposite can do is to howl about this matter.
Although I have listened to all of the speeches that have so far been delivered in this chamber since the budget was brought down, I have not heard one constructive suggestion advanced from the Opposition side. AH that honorable senators opposite have tried to do has been to condemn the budget. To-day, apart from a little unemployment in Western Australia, the people are enjoying conditions as prosperous as they have ever been. I believe that the unemployment that does exist in
Western Australia has been caused chiefly by the maladministration of the Labour Government in that State.
– What was the verdict of the people of Western Australia a few months ago?
– Prior to the election in that State, the Labour Government of Western Australia did not think for a moment that it would be re-elected to office. Consequently, it expended about £4,500,000 more than it was entitled to do. During the first seven months of this year, it expended approximately £3,500,000 on housing, which was its allocation for a full year. The result has been stagnation in the building trade. More than 2,500 carpenters and other building tradesmen were thrown out of work.
Sitting suspended from 12.45 to 2 p.m.
– At the luncheon adjournment, I was explaining to the Senate the reason for the great number of unemployed in Western Australia. I had not quite completed my remarks, and in order that the position might be clearly understood, and in order to ensure that those senators who come from Western Australia do not blame the Commonwealth Government for this state of affairs, I shall give those reasons again. I was saying that by the end of last year the Labour Government of Western Australia had over-spent to the extent of £4,500,000. That meant that this year it had to make up that amount of money before proceeding with its developmental programmes. Because it could not carry on with those programmes, some 2,500 people in the building trade and associated industries had to be dismissed. Then, the Labour party in that State, with the approval of the other States, came to this Government asking for a further £4,000,000.
Let me now compare the unemployment position in that State with that for the whole of Australia. The unemployed in Western Australia, at 31st July, 1956, numbered 5,149. At that date, there were 800 jobs unfilled in that Stale. On 31st July, 1956, there were 31,000 people registered as unemployed throughout the whole of Australia, and on that same date there were 28,300 jobs unfilled. In other words, there was a job registered as vacant for almost every person registered as unemployed. In Western Australia, however, there were 5,149 people registered as unemployed, but only 800 jobs vacant. That means that, in a State whose population is 7 per cent, of that of the whole of Australia, the ratio of unemployment was 25 per cent, of that for the whole of Australia. At the middle of August this year, the total number of persons drawing unemployed benefit was 10,000 for Australia, and of that number 2,300, or 25 per cent., were in Western Australia. The reason for that sad state of affairs is the unimaginative approach made by the Western Australian Government to its developmental works. When that Government took office, there was full employment in Western Australia. The previous State Government had been able to carry Western Australia through the slight recession in 1952 with the least number of unemployed of any State, and yet, within three years, under an unimaginative Labour government, the position there has deteriorated from the best to the worst of any State in the Commonwealth. The McLarty Government carried on developmental works all the time. It attracted overseas capital to Western Australia. During its regime, the Kwinana refinery was constructed at a cost of approximately £50,000,000. The steel-rolling mill of Broken Hill Proprietary Company Limited also was completed. Then, we had the establishment of the Cockburn cement works. All of those huge constructional works employ large numbers of people. Because of that employment, new towns sprang up in the vicinity of Kwinana, and the State prospered; but when the Labour party took office there things changed drastically. I challenge any honorable senator to name one large developmental work that has been carried out in that State since the advent of the Labour Government. It has not been able to attract capital from overseas or for other States for expenditure on developmental works, and I challenge hon.orable senators to name one large industry that has been developed in Western Australia since the days of the McLarty-Watts Government.
The other day, I received a letter from a member of the Labour party who represents a Western Australian constituency in this Parliament. He asked me to join with him in making representations to the Minister for Labour and National Service (Mr. Harold Holt) for something to be done about the unemployment position in Western Australia and he suggested in the letter that the Government should help the unemployed in Western Australia because the unemployment benefit had not been increased since its introduction in 1943. I found it quite easy to explain that since this Government attained office the rates of unemployment benefit had been doubled. At the time of receiving this request, I discovered that the Premier of Western Australia was already in Canberra asking this Government for help. In those circumstances, I did not feel that I should join in any deputation to the Minister for Labour and National Service, and, accordingly, I refused the invitation. After all, the Western Australian Government is responsible for the present unemployment in that State. It has made a mess of things in Western Australia, now it comes howling to the Commonwealth. We have had too much of that in the past, and I thought it proper to make the position clear to-day so that it may be understood by all.
When the Minister for National Development (Senator Spooner) presented the budget papers to the Senate last Thursday, he said -
At present, residents of remote areas of Australia are granted special deductions as a recognition of the disadvantages to which they are subject through uncongenial climatic conditions, isolation and the high cost of living in those areas as compared with other parts of Australia. In the case of Zone A, which broadly covers the area north of the tropic of Capricorn, the present deduction is £120 per annum, and in the case of Zone B is £20 per annum. It is proposed to increase as from 1st July, 1956, the present deductions to £180 and £30 respectively. At the same time, the area of Zone A . will be extended to include that part of Western Australia north of the 26th parallel of latitude, the whole of the Northern Territory, and that part of western Queensland west of the 141st meridian which is now in Zone B.
That, no doubt will help some of the people living in those areas, but we must do more for the pastoralists who are engaged in primary production there. We must encourage those people to re-invest their profits in the areas in which they are living. At present, the people who own large leasehold properties are encouraged to re-invest their net profits .in the development of areas in the southern part of Australia where clearing and fencing for vermin are allowed as tax deductions. They avoid taxation to a large degree and build up a capital asset which they can sell later. That is known in income tax law as capital appreciation, and it is not subject to income tax.
A pastoralist who has a net profit of £10,000 or £20,000 a year can buy an unimproved, uncleared property in the southwest of Western Australia, clear it, put a fire through it and sow pastures, knowing that all those items are deductions for income tax purposes. If a man gets a profit of £10,000 from a pastoral lease in the north, he can invest some of it in the south and thus reduce his income tax and increase his capital account without suffering any undue hardship. We should do something to encourage people who are making big profits on pastoral properties to reinvest their money in the areas in the north already held by them. If concessions, such as 100 per cent, depreciation for capital investment, were granted, the people in those areas would be only too pleased to re-invest their net profits there. This proposal is not novel. It has been incorporated in legislation which applies to the Northern Territory. A property holder in the Northern Territory can claim as tax deductions all capital improvements of a fixed nature such as fencing, the erection of mills and tanks and houses for employees. A settler in the north-west of Western Australia can claim only 20 per cent, of those costs as tax deductions. Many pastoralists in the north are developing properties in the south-west with their net profits, and have been doing so for a number of years.
The least the Commonwealth Government could do to rebuild those areas from which money has been taken would be to adopt the recommendations of the Northwest Rehabilitation Committee. It suggested that if 40 per cent, of net profits were re-invested in the areas concerned, the balance of the money should be tax free. That should be done for about twenty years to encourage the re-investment of money that has been drained from those areas. They can be developed only by encouraging capital investment which now is going to the south.
Recently, I spent months in those areas. I travelled 5,000 miles by motor car and 4,000 by air. The story is the same from one end of the northern part of Western Australia to the other. Everybody north of Carnarvon wants the Government to encourage development there. In addition to the taxation concessions 1 have mentioned, 1 believe that all the workers in those areas should be given tax concessions for the same number of years. The northwest of Western Australia, the Northern Territory and certain parts of Queensland have been stagnant for 50 years. If capital and labour were encouraged, the development of the mining, pastoral and fishing industries would be stimulated. The present population of 10,000 to 15,000 would be more than doubled within ten years.
The Treasurer (Sir Arthur Fadden) has said in his budget speech that our income from overseas should be increased from £800,000,000 to £1,000,000,000 as soon as possible. To that end, I suggest that the great mineral wealth of Australia should be exploited. What have other nations done for their mining industries? Canada gave tax concessions some years ago to encourage the development of mineral resources. Production from mining in that country increased from 500,000,000 dollars in 1945 to 1,500,000,000 dollars in 1955. Minerals and metals now comprise 25 per cent, of Canada’s total exports. The return to Canada totals 1,000,000,000 dollars, or £400,000,000 in Australian currency.
The industry had expanded because the Canadian Government altered its taxation laws in relation to mining, lt gave total exemption from income tax to all new mines for a period of three years. All operating costs may be deducted from mine revenue, and this provision covers depreciation on plant and developmental expenditure. From the resulting profit, a further deduction of one-third is allowed for depletion before any taxable income is reached. Tax rates of 20 per cent, on the first 20,000 dollars and 40 per cent, on the rest are then applicable to the net taxable income. At present, the cost of working plant and machinery for a mine may be allowed as a deduction from income tax, and there is an allowance of 20 per cent, on some minerals, 100 per cent, on gold but nothing on lead. Subject to those allowances those engaged in mining pay the same rates of tax as do all other taxpayers I suggest that the Government has not taken into consideration the fact that a mine is a depleting asset, and consequently very little encouragement is given to “”.-sons to invest capital and effort in mining in Australia.
Over the last ten years Canada has adopted the policy of encouraging mining with the result that that country has developed an export trade worth about 1,000,000,000 dollars a year. I believe that in a similar period of ten years we in Australia could develop an export trade in minerals worth about £400,000,000. If we did that we should balance our exports and imports and there would no longer be any necessity for the restriction of imports. We cannot go on forever imposing import restrictions when we find that we have not earned sufficient money to pay for the goods coming to this country from overseas. Import controls will never solve our balance of payment problems; price-fixing is not the answer to our economic difficulties, and the only way in which we can get out of our troubles is to develop export industries to earn sufficient to pay for our imports. I have great pleasure in supporting this budget.
– lt is stated in the budget speech that Australia must earn about £200,000,000 a year more from its exports in order to pay for its imports. Senator Scott has advocated that there should be greater activity in mining in this country, and he has suggested that those who are at present unemployed in Western Australia might be engaged in this industry. The Opposition is indebted to Senator Scott for being the only supporter of the Government who has admitted that there are thousands of unemployed in this country to-day. Moreover, he has admitted that the Government does not know what to do with them. The Minister for National Development (Senator Spooner), who is a little more ruthless than Senator Scott, is not concerned about some unemployed, so long as there are not too many. Recently, when the Leader of the Opposition (Senator McKenna) stated that there were about 30,000 unemployed in this country, the Minister said, “ How many? “, thus indicating that it did not matter about those people being unemployed so long as Senator Spooner and his close relatives and friends were not unemployed. According to the Minister it does not matter whether the other fellow goes hungry, so long as there are not too many of the other fellows. Of course, we can well understand that attitude because if there were too many unemployed the people would not stand for the policies of this Government. Therefore, until unemployment snowballs, as it will, honorable senators on the Government side will not be very much concerned.
Within the last few months great damage has been done by floods in New South Wales, Victoria and, particularly, South Australia. If an enemy were dropping bombs on that area and destroying tens of thousands of sheep, putting ten of thousands of dairy-cows out of production, destroying rich pastures and causing the same destruction as is being caused by these floods, the Government, and probably the Parliament also, would be in a panic to do something about it. But because the damage is done by water, which is a natural enemy, the Government merely talks a lot about it and does nothing. However, it does claim that it needs about another £200,000,000 worth of exports, although our primary producing industries in this area have suffered a very heavy blow. The Government expects the States to do something about it, but the States are powerless to do anything, just as they would be powerless to do anything to prevent an enemy dropping bombs. The States can only give their support and cooperation to the Commonwealth in any action that it might take.
I did not know that there were so many engineers in this Senate until I heard a debate recently about how these floods could be prevented. I do not pretend to be an engineer myself, and, consequently. I do not put forward any solutions. However, I suggest that the Government should obtain the advice of the best engineers in the world about how to prevent or, if they cannot be prevented, about how to mitigate floods in the Murray River valley. I have no doubt that there will continue to be floods in that area unless something is done to prevent them. If the Government did set about tackling flood mitigation work in a proper manner it could make use of the thousands of unemployed persons that are now anxious to find work. Also, it would not need to reduce its immigration programme but could use surplus immigrants on this work. It is easy to see that the Government is not really concerned about the advancement or defence of this country when it cannot keep a stream of immigrants flowing steadily into it. It is pure nonsense to talk about bridging the gap between imports and exports and about preparing for our defence when the immigration programme is to be reduced and thousands of good Australians are unemployed.
The Government has stated that it cannot develop this country without using capital from overseas. I believe that if the Government can get overseas capital for developmental works in Australia, by all means it should do so. That is a very wise plan. But if the country cannot be developed without borrowing dollars from overseas, obviously the statement made by the head of the Government is not very intelligent. Australia’s overseas trade balance is in debit by about £40,000,000 in the sterling area, and I am not aware of the deficit in the dollar area, but the Prime Minister (Mr. Menzies) is now overseas trying to borrow more dollars. Senator Laught praised him for his great work in doing this. Perhaps it is better that he should borrow more dollars to pay interest on the dollars already borrowed rather than that Australia should default on its interest payments. If the Prime Minister were not able to borrow more dollars, imports would be more severely restricted, or the interest on previous dollar loans would not be paid.
History does repeat itself, and a similar position existed in the late 1920’s. The government of the day was of the same political colour as the present Government - only it was then called the National party - and its cry was that Australia could not be developed without borrowing overseas capital. Money was borrowed from the sterling area, and it was not many years before the government had to send its representative to borrow more money to pay interest on the original loan. The only difference to-day is that Australia is borrowing from the dollar bloc instead of from the sterling bloc, as happened in the 1920’s. It is important, however, that honorable senators should recall the result of that borrowing. A recession began in the building industry, and developed into the depression of a few years later. Although the cost of building is high today, already a recession can be observed in the building industry and unless the Government takes the position in hand there will be a repetition of that former catastrophe.
This problem will never be solved by stealing money out of the defence account and using it for other purposes. Honorable senators know that a sum was allocated for defence, but in the brief period that the Minister for Air (Mr. Townley) was Acting Minister for Defence he took some of that money to buy aeroplanes for use on Government passenger airlines. If an ordinary citizen were to do that sort of thing he would be charged with the criminal offence of stealing or misappropriating public funds. If it is good enough for the Government to pinch money out of the fund appropriated for defence, and spend it on civil aircraft, it should be good enough for the Government to spend some of that money on training seamen for the merchant navy. They would be able to render invaluable service by operating ships of the merchant navy around the coast of Australia, and if, unfortunately, war should come to our shores, they would play a vital part in the defence of Australia.
There is need for a better shipping service between the Australian mainland and Tasmania. Before the war, a passenger and freight service operated between Sydney and Hobart. Since the war, that service has disappeared, and the Government has done nothing to replace it. But the. railways on the mainland have not disappeared, and although they are all working at a loss they are maintained because they are providing a service essential to the development of the country. It is equally necessary that a regular shipping service should be provided and maintained between Tasmania and the mainland similar to that which operated between Hobart and Sydney before World. War II., even if it showed a small loss. It is just as essential as the rail link between Melbourne and Sydney or Melbourne and Perth. I stress again the importance of training men for the merchant service. More ships would be a means of increasing trade, and they would play an important part in the event of an outbreak of hostilities. The Government should realize that adequate shipping services could play an important part in supplying the needs of the people. Instead of produce being allowed to go to waste, it could be transported to various Australian markets. The whole economy of the country would benefit, but so long as the
Government delays in taking action to bring this about it is retarding the progress of the country.
Senator Scott, in speaking of the alleged prosperity of Australia, said that many workers owned washing machines. He is obviously unaware that the great majority of workers do not own washing machines because of the heavy sales tax which the Government has imposed on them. If it were not for the inflationary spiral caused by the heavy sales tax, workers would be able to enjoy many more amenities in their homes. Immediately sales tax is imposed on a machine or any essential article a cost spiral is begun. Let us consider how sales tax on transport affects us. The moment a tax is imposed, it is passed on, and eventually it has to be paid in the shape of increased prices by the man on the lowest rung of the ladder. Every tax causes prices to spiral still higher. The Government, which sets out to obtain additional revenue by imposing sales tax, is the chief offender in causing rising prices and inflation. Sales tax on essential parts of transport vehicles which carry produce to market hits the man on the basic wage. In fact, every increase of sales tax leads to the man on the basic wage. The Government buries its head in the sand and refuses to face the situation. Some time ago, it called the State Premiers together in the hope that they would be able to devise a plan to check inflation, but when the conference met, not one constructive proposal was placed before the Premiers by the Commonwealth Government. It is true that that Government did make one suggestion at the conference, but any one who describes it as a constructive proposal can only be described as brutal and cruel, because it was not a constructive proposal. The suggestion placed before the conference was that the basic wage worker should have his wages pegged, while, at the same time, prices were to be allowed to continue to rise. That meant that the man whose wages were pegged had to pay the increased prices. That was the brutal and cruel suggestion put before the conference by the Acting Prime Minister. Senator McCallum. - He never said that.
– The Acting Prime Minister has not contradicted the press statement that ascribed the proposal to him. In any event, the general public of Australia, including ordinary laymen like honorable senators on this side of the chamber, interpret his suggestion in the way that I have indicated. I am accusing the Government now of having made no constructive proposal at the conference of Premiers. If, as honorable senators opposite appear to think, the Acting Prime Minister put forward some other and better proposal, let them tell us what it was. Can they point to one constructive suggestion that he made? Did he suggests that if wages were pegged, profits also would be pegged? Did he say that the Government was prepared to peg dividends? Of course not. Did he say that he would do something to regulate the prices of foodstuffs, which differed considerably in the several States? Of course not. All the Acting Prime Minister said was that, if the States decided to control prices, he would give them the assistance of officers to help them to do so. When he said that, he knew very well that in the States to which he addressed his remarks there were Upper Houses of the same political colour as that of his own Government, and he knew well that because they were pledged to a policy similar to that of the Commonwealth Government there was no hope of legislation authorizing the introduction of prices control being passed through the Legislative Councils of the States. Indeed, there was as little likelihood of such legislation being passed by the States as there is that I am in danger of bumping my head against the moon.
– What about the position in New South Wales?
– Let us be Australian in our outlook, and deal with this matter on a nation-wide basis, and not be like the Acting Prime Minister who wanted the workers to carry all the burden. The honorable senator who has interjected thinks in the same small way as the Acting Prime Minister did. It is time that we thought on a national basis. I remember when, in 1939, a Treasurer in a government of the same political colour as that now in office introduced a budget which provided for an expenditure of £100,000,000. He described it as a record budget in the history of this Parliament. This year, the present Treasurer is budgeting for a surplus greater than that of the whole of the budget expenditure contained in the 1939 budget. It is a good thing that the Treasurer this year has budgeted for a surplus, because. so far, he has given no indication that the Government intends to do anything about the devastation caused by floods in South Australia. Some of the surplus may be needed there, and, indeed, money could be spent to great advantage in that direction. Every year, millions of pounds from Consolidated Revenue are being poured into the Snowy Mountains scheme. The Government says that the money must come from Consolidated Revenue because the loan market cannot finance that huge scheme. It is time that the Government thought nationally, instead of being parochial in its outlook. Although the Snowy Mountains scheme is being proceeded with in the interests of Australia generally, it will benefit principally the States of New South Wales and Victoria. Those States will gain the benefit of the electric power which will be generated, but neither Queensland nor Tasmania will gain any advantage of that kind. While that scheme is being financed out of Consolidated Revenue, chiefly in the interests of New South Wales and Victoria, Tasmania is compelled to borrow money in the open market and pay full interest rates on the money borrowed to finance its State hydro-electric scheme.
– Let us be big Australians.
– Is the honorable senator prepared to advocate that the Government should apportion money from Consolidated Revenue to assist Tasmania with its hydro-electric scheme, as it is assisting New South Wales and Victoria? What applies to Tasmania applies also to other States that have to borrow money for their developmental schemes. Not many in the community realize that the people in some States are paying double. They are paying interest on money raised for the development of their States, and also contributing to Consolidated Revenue out of which money is provided for the hydro-electric schemes of New South Wales and Victoria. The people of the two last-mentioned States make no contribution towards the cost of the Tasmanian hydro-electric scheme.
– That situation is met by Commonwealth grants to Tasmania.
– The Minister for Repatriation (Senator Cooper) should not try to silence me with that silly story. Tasmania is not getting the money back by means of Commonwealth grants. Tasmania and some other States received grants long before the Snowy Mountains Scheme was begun. The grants were made because of other disabilities suffered by those States, and had nothing to do with the supply of hydro-electric power, as the Minister well knows.
– What about the project at Bell Bay, in Tasmania?
– That is a national project.
– I thought the honorable senator claimed that it was Tasmanian enterprise. He has said so many times.
– It is true that Tasmania out-bid Queensland in connexion with that project, but that project would never have been started in Tasmania had not the so-called experts of that day decided that Tasmania was the most appropriate place for it, from a defence point of view. They did not consider that Queensland was so suitable, because of the defence risk.
There is nothing whatever in this budget to give relief to pensioners, who are most in need of help, but as that aspect has been dealt with adequately by other speakers on this side I shall not deal with it further. To-day, I asked a question of the Minister representing the Treasurer, who was eager to tell us something about dividends and profits. I asked him if he could tell us what were the profits of these registered societies established under the medical benefits scheme, but he certainly dodged that question. The societies have not disclosed their profits, but they were £1,000,000 the year before last and £800,000 last year.
– The shareholders do not get the profits; they accumulate in the funds of the society for the benefit of those who pay the premiums.
– Let me tell the Senate how the funds are distributed under clauses in their charters which were sanctioned by this Government. These clauses are interpreted by the officials of the fund and by the shareholders who happen to be members of the British Medical Association. No one can get anything out of the fund if members of the British Medical Association are opposed to him, because the officials of the fund interpret the regulations according to the desires of the British
Medical Association. For instance, if an honorable senator were in hospital suffering from influenza three years ago and he again contracted influenza this year and went into hospital, it would be classified as a recurring or chronic disease, and unless he had been a member of the fund two years prior to the first attack he would not get anything. That is how the regulations are interpreted by members of the British Medical Association. They are the gentlemen who get the dividends, and that is why they are not disclosing their profits to this chamber. If an honorable senator met with an accident and broke his leg three years ago and were to meet with an accident this year and again break his leg, that would be classed as something recurring and chronic. I know exactly what I am speaking about.
Furthermore, if an honorable senator’s -wife is ill, a member of the British Medical Association will not sign the necessary form unless he is given full permission to make a secret report to the society concerned. That man must not know what is wrong with his wife; yet an office boy employed by the society in one of our capital cities has full access to the particulars on the form and could tell him. That is the greatest swindle and the greatest racket that has ever been legalized in Australia. That is about the best compliment any one could pay to it. What did this scheme replace? It replaced a completely free hospital and medical benefit scheme for all who went into public hospitals in Australia. That was the position until this racket was introduced. The general public is still paying for the old scheme and it is paying for another scheme by way of premiums which are, in fact, just another form of taxation. It amounts to double taxation. The whole thing is a racket. If the Government were sincere in wishing to do something to assist the general public that is suffering and smarting under some of its legislation it would do something about it. The Government will not peg profits and prices; all it wants to do is to peg wages.
Then, there is the case of a man who gets a prescription from a doctor for pills or something of that nature which are, in fact, just a patent medicine. Because it is written on a prescription form by a doctor the pharmaceutical guild demands that it must be paid for at prescription rates. Without a prescription, it could be bought for less than half the price. A person does not know what is in the prescription unless the chemist tells him. I took a prescription to a chemist and asked him what was in it. He said, “They are just such-and-such a tablet; I am taking them myself “. He told me that to make up the prescription all he would do would be to dissolve the tablets, and it would cost me ls. a dose. I could buy the box for 3s. 3d., but by getting it under the doctor’s prescription it would have cost me 12s. 6d. Needless to say I did not get the prescription. That is the sort of racket that is going on. The Government will not do anything to peg profits of that kind. No; but it will peg wages. That is the only proposition it puts up in an attempt to stop the spiral of inflation.
Now, let me deal with something of a more serious nature.
– Was not the honorable senator serious before?
– I was speaking about something very serious. If the honorable senator does not consider what I was talking about to be of a serious nature, he demonstrates how brutal and callous some members of the Parliament can be. We need not be surprised at anything if all the members of the Government are of the same opinion as he is. I come now to the subject of defence. I believe in defence, but let me tell honorable senators that the enemies of this country are not only without but also within, lt will be those within that we shall be called upon to face if they are not checked before they go too far. That is the position at the present time. We have enemies in this country who are ruthless and cowardly. They do not care whom they come up against, or what methods they use. There is a secret organization working inside the country, and I have every reason to believe that it was first engineered by what we know to-day as the “ groupers “. There may be others involved who are not “ groupers “, but is is from the “ groupers “ and their sympathizers that this organization originated in the first place; and it still exists.
– Why not tell the security service about it? Why tell us7
– We have had instances of the work of the security service in which some might consider it did disservice to this country’s security. We have to consider that angle of the problem as well. Probably, if we could unearth the main offenders in the matter I am now mentioning, we might find that they are connected in some way with the security service. We do not know in what stations of life some of these people are, or with whom they are connected. I could name people in here to-day who, if they were put on a criminal charge for offences they have committed over the last twelve months, would spend the rest of their lives probably in gaol, that is, if they were justly sentenced for the criminal offences that they have committed. Some honorable senators laugh at such a thing; but that is exactly how Hitler started in Germany - by the aid of small secret organizations. It is exactly how Mussolini started; and such a small secret organization is operating in Australia, -and not in one State alone.
– When we tried to get rid of them honorable senators opposite voted against us.
– Let me finish my story, and, in due course, I will probably bring forward evidence in this Senate. “When it is getting to the stage when a man who is known as an underworld gunman can walk into an hotel and threaten to shoot up people if they do not bow to his wishes, the position is getting serious. That is what is taking place.
– When we reach the -position where those chaps will make a -statement in front of a most prominent witness - and when I say a prominent witness I refer to one of the leading barristers of -one of the capital cities of Australia - that they are carrying out the direct instructions of the Attorney-General of a State, it makes one stop and think just what is going on in that State.
– Can you give us the particulars?
– I shall not furnish the particulars to-day, but I can say that it is going on in Tasmania and New South Wales, and although not to the extent that I mentioned a moment ago, in Victoria. As I said at the outset, I have every reason to ^believe that the organization that is behind it is what honorable senators on the Government side call the “ groupers “ and their “ fellow travellers “. Compared with those people the “ Corns “ are amateurs. I refer particularly to things that are going on in Tasmania to-day.
– To whom does the honorable senator apply the term “ groupers “?
– The honorable senator who has just interjected can place his own interpretation on that term. If supporters of the Government are depending on the “ groupers “ to keep them in power, they should be careful that that idea does not boomerang, as happened in both Germany and Italy and may probably occur in Russia. Prior to the advent of the “ groupers “, only the Premier of Tasmania, Mr. Cosgrove, and myself fought the “ Corns “ on the public platform in Tasmania. But I emphasize that the organization that I have mentioned is far more, dangerous to Australia to-day than ever the “ Corns “ were. I hope that the Government will take notice of the warning I have given about what is going on in Australia to-day. This will not be the last time that this matter will be raised in the Senate by myself and by other honorable senators.
– In sporting parlance, as far as the budget is concerned, the ball is now in my court. I do not propose to weary the Senate bygetting down to talking depression or discussing the hysterical fears that we have heard expressed from the other side of the chamber, nor do I intend to try to make political capital out of these things. We are conscious that, in this great country, there are people whose income is insufficient to enable them to enjoy the standard of living that we should like them to enjoy. We know that, despite the great prosperity that exists, there are many unfortunate souls who have not been able to obtain the standard of housing that they merit.
I should like to discuss, from a layman’s point of view, the budget that has been brought down by the Treasurer (Sir Arthur Fadden). Generally speaking, in a budget, era, that is, the period from immediately before a budget is introduced until just after it has been introduced, the people of Australia can be divided into two choirs, one singing, “We want more money; give us some, give us some do “, and the other, completely out of tune, but equally sincere, saying to the tax gatherer, “ You are driving us crazy; taxes are too high “. Unbiased members of the community admit readily that, taking into account both direct and indirect taxation, Australia is a highly taxed nation, lt is also just as readily admitted that pensioners and other persons in receipt of fixed incomes, such as superannuated persons have become the new poor people in Australia. I believe this description was applied first by the Leader of the Opposition in the House of Representatives (Dr. Evatt). Although I do not often agree with the views of the right honorable gentleman, I agree with them on this occasion. The people I have mentioned are the greatest sufferers from inflation. Big business doss not suffer from inflation. This being so, the aim of this Government, and of the Parliament, must be to curb inflation and to provide, if it is possible within the economic resources of the country, an adequate system of social services. In speaking of curbing inflation, I want to remind the Senate of something that the Treasurer said, and I should hope that every newspaper would direct attention to the right honorable gentleman’s words from time to time, in order to remind the people of a very salient factor. The concluding paragraph of his budget speech reads as follows: -
As I have said on other occasions, Inflation cannot be remedied by government action alone. The kind of measures we have taken are designed to restore a state of general balance in the economy and I think they have had a degree of success in that direction. But inflation is a pervasive thing. It draws upon many sources and is helped along by a multitude of actions on the part of individuals and of groups. This has to be more widely recognized and there must be a common will to resist inflation and do the things necessary to avert it - to produce more, to save more, to look for ways of reducing costs and of economizing in resources whatever the line of activity may be . . . If those sentiments could be inwardly digested and acted upon by big business in Australia to-day, as well as by ordinary business and by ordinary parliamentarians, I, think that the Government would have a great and powerful partner in its efforts to curb inflation. Do not let us run away with the idea that, at any particular time, the government in office can alone make a sufficient impact in its fight to curb inflation. In recent years, the Commonwealth
Government, as a part of its policy to curb inflation, has taken away surplus cash from the people by the fairest and most equitable means - taxation - and put it into Consolidated Revenue. That is part and parcel of the Government’s responsibility. It is as well to remind ourselves at this time of just what is the Commonwealth Parliament’s responsibility in the financial sphere. First and foremost, it is to provide moneys for the States. Uniform taxation is a pernicious system of financing the Australian Commonwealth. It is a system that leads to waste and extravagance and to lack of responsibility in the States. It leaves to the Commonwealth Government, the central government, the sols authority for raising big amounts of revenue and, of course, all the stigma attached to taxation. The second responsibility that the Commonwealth Government has is to provide revenue in order to meet its own important commitments, such as social services. I am not talking party politics when I say that no previous Australian government has such a proud record for initiating new ideas in social services legislation. This Government has, in previous years, introduced the free milk scheme, the free drugs scheme, and the pensioners medical and hospital benefits scheme. It has also passed legislation to provide homes for the aged. During the last financial year, £1,500,000 was expended on such homes. That is the second of the Government’s responsibilities. The third is to provide, in a time of cold war, for the adequate defence of the country in time of war. The Government’s record in this direction is good, but, unfortunately for all of us, a little cloud has come over our thinking on the expenditure of £190,000,000 in one year for defence. There have been assertions, allegations and rumours of waste. All I say to the Government here is that I admire it for providing £190,000,000 out of Consolidated Revenue for defence. I think that expenditure is warranted, but it behoves the Government to see to it that no one is given grounds for alleging that Id. of that money is being wasted. If it is being wasted, then some heads should come off. The Government has a sacred right and trust, when Parliament votes the money, to spend that money honestly and without waste.
The capital works and services responsibility of the Commonwealth Government is another important aspect for which it has to raise revenue. That revenue must be raised on an equitable basis and along lines which it and its advisers believe to be sound economically. What this Parliament and the people of Australia must always remember is that when they cry for more money for this, and less taxation for that, the people are the ones who pay, irrespective of what the Parliament provides. There is no orchard where one may go and pluck £5 notes from trees. The people must find the money, and it is well to remember this when asking for more money for this and less taxation for that.
What is wrong with the budget as presented? Where is there any budgetary weakness in connexion with expenditure? I should say that the chief responsibilities rest with the States, and this Government is providing the States with £243,000.000 this year, an increase of £23,000,000 over last year’s budget. Not one honorable senator will have the courage to say that the Commonwealth is being too generous in its allocation of funds to the States, and 1 remind the Senate that the total budgetary expenditure of this Government for the present financial year is £1,121,000,000, as compared with £566,000,000 in the last year of the term of the gone and almost forgotten Labour Government. In its final year, the Labour Government expended roughly only half the amount provided for in the budget under discussion. We are providing £243,000,000 for the States whereas, in 1949-50, the Labour’ Government made available only £100,000,000, less than half the amount provided by us, although its budgetary expenditure was equal to half ours.
The next big capital expenditure relates to social services. This year, the Government is devoting £226,000,000 to that purpose. That is an increase of £12,000,000 over last year’s budget. Again I point out that the Labour Government spent only £92,000,000 on this work. The present Government has been far more generous than the Labour party was. I do not say that this Government is too generous, or even generous enough in this field, but it ill becomes members of the Labour party to criticize this Government when the Labour government itself was mean, thoughtless and uncaring for the people. To-day members of the party show nothing but “ blatant insincerity in their protestations of concern for the welfare of the people. When we compare defence expenditure we find that this Government is spending £190,000,000 whereas the Labour government spent only £41,000,000 and left the defence forces tattered, torn and merely wrecks of their former selves. It did not care a hang about defence.
I come now to capital works and services. It is the responsibility of the central government to build up those things that it is necessary to build up under the Constitution. We are devoting £109,000,000 to that purpose this year. This is an increase of £8,000,000 over what was spent last year, and the Labour government spent only £53,000,000 on this work. In those circumstances, the Labour party can hardly criticize this Government for its allocation.
When we come to considering expenditure on the departments, it is time for the Labour party to sit up and take notice. Members of the Labour party and the daily press continually accuse this Government of being over-generous and wasteful in its administration of the Public Service and government departments. This year, the expenditure under this heading is £56,000,000, or £3,000,000 more than last year. I point out that we now have 2,000,000 more people in Australia than we had when the Labour government was in office. We also have a far greater defence force than the Labour government had, yet the only budgetary item in which Labour’s record comes anywhere near half ours is in relation to expenditure on departments. The Labour government spent £30,000,000 under this heading. If that amount were doubled, it would be £60,000,000, so that, taking Labour’s record, if it were the government to-day there would be far more justification for criticism than there is in connexion with the present Government.
I come now to a point about which T am not so critical of the Labour party. I refer to war and repatriation services. We are spending £123.000.000 under this heading whereas the Labour government spent £96,000,000. I admit that our expenditure on war and repatriation services has not kept pace in the last two budgets with that of the Labour government during its time, but I can say without fear of contradiction that in 98 per cent, of cases the ex-servicemen are satisfied with the deal this Government gives them in connexion with social services.
Another responsibility of the Commonwealth Government is the raising of loan funds for the States. I emphasize that it is the raising of loan funds for the States. This year they asked for £210,000,000. The Commonwealth Government said it would agree to underwrite £190,000,000 and that it would meet again early next year to see if it could provide the total amount by way of raisings and underwritings. But the greedy States, the States who have no responsibility, have asked for £210,000,000! Honorable senators opposite chide this Government with budgeting for a surplus of £108,000,000, but I remind them that the purpose of the surplus is to provide for the underwriting of loans for the States and for loan maturities. This Government’s record for helping the States by providing loans to the States from revenue is second to none. A comparison of what this Government has done with what the -Labour government did is most unfavorable to the Labour government. In 1949-50, the Labour Government provided £92,000,000. This Government provided £193,000,000 last year, so it is not correct or fair to suggest that we are being mean in providing loan funds for the States. This Government has given private enterprise a fair go, and in an expanding economy such as Australia’s is now, there is a great call for funds that normally would go to the Government by way of loans.
One of our greatest problems is that we have not available a sufficient quantity of loan money to provide for all the wants of the State governments. Each year since it has been in office, this Government has provided large sums of money to help the States. In addition, it has paid out of revenue for defence, capital works by the Postmaster-General’s Department, housing for the States, war service land settlement and war service homes. It has done that without any idea of political expediency. The Government knew it would be unpopular as a tax gatherer, but it believed that Australia would benefit if funds were available to the States for capital works. I regret the shocking waste that I see in someStates, but I support the general principle. This year, the Government has promised the States to find, if possible, £210,000,000.
I believe the Government should try to make the bond market more popular with small investors. A lot of money is lying idle in Australia. In the last month, the deposits with trading banks have fallen, slightly, but . each month there has been a. marked growth in the savings of the people.. At the end of June last, money in the savings banks of Australia had risen by £32,000,000 since March. There was then. £1,140,000,000 of the people’s savings in the savings banks of Australia. That was equal to £116 per head of population. That illustrates how much money is available, but is not going on to the bond market. As there is a great need for loan funds, we have to tax the people to raise revenue for expenditure on capital works. I know that that contributes to inflation, and any plan that would entice more money on to the bond market so that taxation could be reduced would be invaluable.
A suggestion came to me in this connexion from the Liberal party in Tasmania, one that should receive close consideration from the Treasurer (Sir Arthur Fadden). It has been suggested that death duties should be payable in Commonwealth bonds which would be accepted at their face value. That would mean that if bonds were worth. £93 on the market when a person died, they would be accepted by the Commonwealth for the payment of death duties at their face value of £100. From that day on, the Commonwealth would not have to pay interest on the bonds and, in due course, it would pay the money to itself. I believe there would be a great upsurge of buying of Commonwealth bonds if that plan wereadopted. Of course, it would apply only to the original holders of the bonds so that there would not be any illegal trafficking in them.
I object to much of the silly, expensive advertising of Commonwealth loans. Thereseems to be an inane competition to giveeach loan a new name. We need morethan advertising. We must provide draw cards to encourage the people to invest. I do not know whether the Government hasseriously considered following the United’
Kingdom Government’s bond lottery proposal. I do not support it, but the Government could give it some thought.
As I have said, there is a new poor section in the community to-day. It is made up of pensioners and those on superannuation. However, before we become critical of the Government in that connexion, we should study some salient features of this problem. Most honorable senators on the Labour side are critical of the Government, but it is well to remember the responsibilities of the previous Labour Government compared with those that face this Government. In 1949, the Chifley Government paid pensions to 397,000 people. We pay pensions to almost 529,000 people. That is an increase of age and invalid pensioners of 131,599. The reason is that our social services legislation has been enlarged to cover more pensioners. Besides, we are a healthier people, and are living longer now. The number of persons entitled to age and invalid pensions has grown from 406 for each 10,000 of population in 1949 to 473 at the present time. So we have an ever-growing number of age and invalid pensioners to care for.
I support the budget, but I believe that the Government has a sacred duty to cut out waste and undue expenditure, and from the savings so made to give better pensions to those who are entitled to them. I should not make that suggestion unless I had some good reason for doing so. We have a fairly large army which includes engineers, signallers and other specialists. Consider the signals sections for example, in which I was proud to serve during World War II. The unit of which I was a member built the permanent telephone line from Port Moresby over the Owen Stanley Range to Kokoda. I suggest that signals units in Australia to-day should be used in country areas to build permanent telephone lines, and in that way gain valuable experience and bring a permanent benefit to the country. They should do that rather than go out into back paddocks behind camps and put up telephone lines and pull them down again for practice. The signals units built a line over the Owen Stanleys, and they could build one in Bourke street, Melbourne, Pitt-street, Sydney, or along any bush track. The Government has to train and equip specialist units in the Army, and we might just as well allow these units to build permanent works rather than to put up poles and cross arms in a paddock behind Brighton camp, and then pull them down again.
I suggest also that the men of these units would have much more pride in their work and training if they were allowed to put up telephone or electric power lines in new housing areas rather than merely to practice in paddocks. They would know that they were doing something for the nation in return for the pay that they were getting. The engineer groups in the Army use earthmoving and bridge-building equipment in their training in order to obtain experience. Let them practise where we need roads and bridges, and where it is necessary to level off land for playgrounds and schools. Let them do all these things which will save a vast amount of money for the Federal Government and State governments and local government organizations. I suppose that some one will raise the objection that the unions would be opposed to that sort of thing. It is my opinion that in this time of full employment there would be no longlasting opposition from the unions, although a few militants might have something to say in the beginning. Any such opposition would be easily overcome, and the result of such a change of policy would be that the men would be trained properly, much public money would be saved and urgent works would be carried out.
Our greatest difficulty to-day, because of full employment, is that we are getting too little too late in the way of general service for the people. The Royal Australian Air Force has air-field construction units. I do not know whether they are busy at present, but if they are not let them be sent to places like Tasmania, where there is plenty of work to be done. They could work on King Island, Flinders Island, Smithton air field, St. Helen’s air field and Pardoe. It is far better that they should be laying down fair dinkum runways than playing about practising at doing so. If all that were done there would be less complaint about far too much money being spent on defence.
Much money is wasted in recruiting persons for the Services. The three Services, and the recruiting directorate, should immediately take a public opinion poll of every recruit that they get. They should ask him why he joined up, whether it was because of an advertisement in a newspaper, whether it was because his father or brother was in the Services, or whether he heard something about the Services in news broadcasts or newspapers. I should say that not one in ten would say that he was induced to join up by an advertisement that he saw in a newspaper. Yet, hundreds of thousands of pounds must be spent in advertising in the daily press. There are four or five Ministers responsible for defence, and I should like to see them take a little gamble and abolish press advertising for six months. By doing so they would save about £100,000, and 1 venture to suggest that they would get just as many recruits. Also, if there were less advertising for the Services probably more publicity would be given to the proceedings of the Senate. But, seriously, I believe that my suggestion should be adopted.
If money must be spent in order to get recruits, it should be spent on good, honest copy, and, mainly, on films. I recently saw a film about the Royal Australian Air Force, and if I had been younger and did not wear a hearing aid, I would have joined up then and there. Films such as that appeal to young men to-day to a much greater degree than stupid advertisements in newspapers. Under the present scheme, it costs an enormous sum to get one person into the services because of advertising, administrative work, and so on, and so we should aim at getting those who are already in the Services to join up for another term of perhaps six or twelve years. We should not have people entering the Services for one period and then leaving altogether; we want to keep them in. If that were done it would improve the value of the Services and save money.
Another way in which we could save money and set an example to the people lies in a revision of the sittings of the Parliament. We could do our job better, and spend more time in our electorates, if we met on Tuesday, Wednesday, Thursday and Friday until 6 p.m., had Saturday and Sunday free - and it would do honorable senators a world of good to see Canberra as I did last week-end - and hold party meetings and sit on Committees on Monday. The following Tuesday the sittings would commence in the morning and be continued on Wednesday, Thursday and Friday. We would all go home on Saturday and not return to Canberra until the following Tuesday week. That would save the nation the cost of more than 90 per cent, of the air fares of members to and from their States. Every time that I return to Tasmania on a Friday, and come back’ to Canberra on the following Tuesday, the nation has to pay £34. If I stay in Canberra it costs the nation £5 more than my Canberra allowance, but saves £29. Honorable senators can appreciate the saving which would be effected if we attended parliamentary sittings at Canberra during the times I have suggested. During a long session of Parliament an enormous saving in air fares alone would be effected. It is useless to say that air fares are merely book entries, because I travel by Australian National Airways Proprietary Limited, and that involves an expenditure of the people’s money.
If a programme such as I suggested were followed, the sittings of Parliament would be better attended, honorable senators would give more time to their duties and party meetings, they would get to know the national capital better and public money would be saved. Of course, I should like to see the broadcasts of parliamentary proceedings eliminated, but I will not be allowed to discuss that matter now. I hope that the Government will consider the suggestions I have made. The press, according to its political colour, has given the budget various names. Unlike Senator Aylett, I think the press is biased in different directions. Various authorities have been blamed for certain aspects of the budget, but speaking as a layman, with my good ear to the ground, I consider that this budget is solid and sincere. However, it will lose its value unless the Government, backed by the Commonwealth Public Service, makes an honest attempt this year to save money by cutting out waste, and tries, in the near future, to do something to alleviate what is admittedly a stress on a number of those in receipt of various social services. I support the budget.
– The time has come again when honorable senators on the Opposition side have to examine and fairly criticize a budget presented by a Liberal-Australian Country party Government. It is a statement of tremendous magnitude. Large sums of money have been received into government revenue, but so far not one of the promises made by the Government during the last election campaign has been honoured. The Government has presented this budget, and has sincerely apologized to the people for being unable to cope with inflation and balance Australia’s overseas trading account or, indeed, to report to the nation that Australia is enjoying any measure of economic stability.
I was interested to hear Senator Marriott’s constructive suggestions to the Government. Up to this time we have acknowledged, and the Liberal party must also admit, that the Government has found a method of taxing the Australian citizen from the cradle to the grave. Senator Marriott has now gone one better, and has suggested that the Government, even before a testator has reached the grave, should collect from him advance payments of death duties. The Government is expert at extracting money in advance, and leaving its successors to worry about the deficit because it has taken what legitimately should not have been collected for many years.
Much has been said about the present economic position, and comparisons have been made with that which existed when the Labour Government left office in 1949. Facts have been twisted - probably not with intent, but as a result of ignorance - and I propose to read from the budget speech of the Prime Minister and Treasurer, Mr. Chifley, at that time. He said -
In 1948-49, for the second time since the war ended, it was possible to balance the Commonweal h budget. All expenditure, excluding advances to the States for housing, was met from revenue, and, in addition ion, subs tantialsums were set aside in the National Welfare Fund and the War Gratuity Reserve.
This result marks a great improvement in the national finances under post-war conditions - an improvement which can be measured by comparison with 1944-45, the last full financial year of the war period. In that year revenue fell short of expenditure by £266,000,000, which had to be borrowed.
I remind Government senators that this period followed one of the most expensive and terrible wars in the world’s history, and I direct their particular attention to what the Treasurer of the day was able to report concerning the nation’s economic position. He said -
In the four years since then-
That is, since the war ended - tax reductions have been made which, on present income levels, would be valued at £280,000,000 per annum.
That was in good, solid, uninflated currency. He went on -
Large outstanding war accounts, including the lend-lease settlement, have been met; £108,000,000 has been provided for repatriation and reestablishment of ex-service men and women.
No wonder Senator Marriott feels a little distressed at belonging to a party which has ridden on the backs of the returned soldiers, and whose policy has produced inflation. Mr. Chifley was able to report in 1949 that- £184,000,000 has been found for interest and sinking fund on debt arising from the war; gifts totalling £35,000,000 have been made to the Uni ed Kingdom; contributions worth £30,000,000 have been made for the relief of war-distressed peoples: social service expenditure has been increased from £39,000,000 a year to £81,000,000 a year and the National Welfare Fund has been built up to nearly £100,000,000. Social service expenditure this year is estimated at £100,000,000; annual payments to the States have been increased from £48,000,000 a year to £79.000,000 a year.
Again, that was in uninflated basic currency, which was double the value of the present currency to which the Government is proud to refer. The former Treasurer added - £132,000,000 has been paid in subsidies to keep down the cost of living and to assist primary producers; a post-war defence programme to cost £295,000,000 has been pushed forward and great national works have been undertaken in the fields of the post office, civil aviation and power development.
At that time, Australia had the best internal economy in the world. From time to time we on this side of the chamber have brought to the notice of the Government the fact that, on account of its inflationary policies and its departure from a regulated and balanced economy, Australia must eventually reach the point where it will cost itself out of the world’s markets. The Government denied that such a thing was possible, but to-day we have reached the position where our costs of production are such, because of the inflationary policy of the Government and its maladministration, that we cannot compete in the world’s markets. In many instances, it does not matter a great deal to what degree we can increase production, because increased production will not improve our economic situation unless we can sell our products overseas at world parity prices, or better. It is not sufficient for the Government to say that it cannot be concerned about that, because I know that it is concerned. However, it does not tell the Australian people of its concern. Now we find that the Government is extracting from the people of Australia an all-time record amount in taxes. Its estimated revenue from all sources for this financial year is £1,230,153,000. Out of that tremendous sum, the Government talks of giving something back to the people in the form of social services, but it is idle for honorable senators supporting the Government to say, as they have said, that the position is satisfactory, and that the economic situation is such that the Government can be proud of its record. Only a few months ago, the Prime Minister (Mr. Menzies), in what might be termed an interim budget speech, put the position clearly and truthfully to the people. He told them what the Government did and what action it proposed to take, but for reasons of political expediency that statement was delayed until certain important elections in the States had taken place. Fortunately for Western Australia, that State is so far removed from the seat of government that the people were not misled by the attempt to conceal the facts. In the economic statement of the Prime Minister, to which I have referred, the right honorable gentleman said -
We are, as a nation, enjoying a high measure of prosperity. Our purpose is to preserve and consolidate it. To achieve these purposes, we must be prepared to face up to the factors which tend to destroy prosperity by aggravating our costs, to the inflation of our currency, and to the great task of maintaining and building our trading position in the world.
Those were nice words, and we can all agree with him, but the actions of the Government have aggravated the serious position about which the Prime Minister warned the people. On that occasion, he went on to say -
We proceeded, in September, to impose further restrictions upon imports, in order to help to arrest the fall in our international reserves and therefore to check the threat that would otherwise arise to our exchange rate.
A country must be in a desperate position when it has to take such action.* The present Government professes not to believe in controls, but that control is a vital one, because of its effect on the Australian people, particularly as it is not applied uniformly. The control can be applied to make the way easy for some people, whereas in other instances it can bear hard on the persons affected. Western Australia has suffered severely from this policy, but it is true that the whole of Australia has suffered as a result of the import restrictions imposed by the Government. Quotas which apply to traders in Western Australia have never been re-assessed. In other words, the position which existed in the base year has continued, and the import restrictions which operate relate to years when many Western Australian business people were struggling to establish a quota, they having previously dealt with traders in the eastern States as principals, the quotas remaining in the eastern States. Under this system of control, the position has been reached in Western Australia where importers have quotas so ridiculously low that suppliers have told them that it is not worth while sending such small quantities as those to which they are entitled. Western Australian traders find it very expensive, because of high freight rates and insurance charges, to buy from the eastern States more than four times the quantity of goods that they are permitted to import from abroad, and to pay rates 12i per cent, above what they would have to pay were they able to obtain import licences themselves. Yet the Government claims that this is good administration, and that its action has prevented blackmarketing. The fact is that business people in Western Australia are virtually buying import licences from major firms in the eastern States, and are paying 12i per cent, for those licences. I have on many occasions appealed to the Government to have this position rectified, but no action has been taken.
I come now to the Government’s attitude towards the imposition of taxes and the concessions to be granted under this budget. Following the pattern of its previous budgets, the Government has again acted with a callous disregard for the welfare of the people in the lower income groups. Because of inflation, we find that the basic wage, which in 1948 was £5 16s. a week - I refer to the needs basic wage - has now risen to £13 a week. Under Labour’s administration a person who was in receipt of the- basic wage, and had a wife and two children, paid no income tax or social services contribution.
– Is the honorable senator correct in saying that there is now a needs basic wage?
– The Government has destroyed it but the court still gives the figures. That is the basic wage which the Government would pay if it gave the worker his legitimate rights and was not robbing him. The figures supplied by the court indicate the amount of the basic wage, and the State governments are paying that wage to workers under its awards. However, the Commonwealth Government is cheating the workers by not paying the proper needs basic wage as determined by the court, and on the basis that existed when the basic wage of £5 16s. a week was determined.
– When the honorable senator says that the courts have cheated the people his remarks are more suitable for the regatta ground than for the Senate.
– The honorable senator led with his chin when he asked whether it was the needs basic wage. I did not say that the court had not paid it but that because of the Government’s policy and a direction to the court, it has not been paid. It the policy of the Government had been fair, the court would not in any way have impeded the basic wage but would have fixed it on fair, equitable and honorable grounds.
A plea has been made by this Government that we should have a uniform wage system throughout Australia. Where the implementation of that suggestion breaks down between the Commonwealth and the States is that the States say that the uniform system should be determined on a fair assessment of social justice. This Government has denied that justice to a small section of the community only, its own servants and those few people working under federal awards. Again, the attitude of the Government to those workers whose wages have gone up as’ the result of inflation is that whereas previously a man, with a wife and two children, earning the basic wage was not taxed he is now forced into the taxation field. His frugal wage, determined by a court of justice, is subject to tax. It should be removed from the taxation field’. It is true that this Government has given some relief in taxation but not to persons in the lower income ranges. In that way the Government has changed the incidence of taxation in the community by gradually placing the burden on those persons.
It may be argued that some advance has been made in social services. I compliment the Government on its scheme for subsidizing on a £1-for-£1 basis institutions and charitable associations which are building homes for aged people. That is an excellent idea but it has touched only the fringe of the problem. A very fine institution has been built in Western Australia. It accommodates 120 aged persons, and I pray God that more of such institutions will be built. However, the Government has failed in the big job. Thousands of pensioners are trying to exist on £4 a week, and the Government has done nothing for them. It admits that inflation has become so solid in this country that it is necessary to extract from the people two and a half times as much revenue as the Labour Government found necessary to extract in the years immediately after the war. Because of an interference with the base on which wages have been paid, a statistical comparison of wages becomes somewhat distorted. This Government uses that distorted comparison regularly in this House, but let us attempt to arrive at a statistical basis so that we can compare wages that were paid in 1949 with wages that should be paid to-day and which are being paid in the States. It will show just how the Government has treated the pensioners in relation to the purchasing power of their pension. We find that class A widow pensioners in 1948 were receiving £2 7s. 6d. If taken on the basis of the needs basic wage, or the basic wage applying in the States to-day, those pensioners should be receiving £5 6s. 6d. a week. That means that a widow in this class is suffering a loss of £1 ls. 6d. a week, or £55 18s. a year. Class B widows, who were receiving £1 17s. in 1948 on a basic wage of £5 16s., should be receiving, on a basic wage of £13 a week, the sum of £4 2s. lid. Under this budget, the class B widows’ pension is £3 7s. 6d., so that the widow is suffering a loss in actual purchasing power ,Or 15s. 5d., or £40 ls. lOd. in> a year. Yet, the Government claims with pride that it is relieving the widow by giving her some mediocre and miserable payment - probably the cost of two potatoes - if she has two children or more. What has the Government to be proud about in that instance?
Since it came into office the Government has made an increase in unemployment and sickness benefits. Over a period of seven years it has magnanimously and generously, so it thinks, given an increase to this unfortunate section of people, but there have been basic wage adjustments during that period, marginal increases to tradesmen and two increases in parliamentary salaries. These are the people the Government talks to and promises to do something for but to whom it gives very little. A single adult in 1948 received under this heading £1 5s. a week, when the basic wage was £5 16s. On the basis of the needs basic wage he should be receiving £2 16s. The position is that under this budget he receives £2 10s. His actual loss of purchasing power is 6s. a week or £16 12s. annually. A dependent wife, in 1948, received £1 a week. She should be receiving £2 4s. 10d., but actually she is receiving £2 under this budget. That amounts to a loss of 4s. lOd. a week, or £12 1 ls. 4d. a year. Unemployment and sickness benefit in respect of the first permissible child was 5s. in 1948. Based on the unpegged basic wage, the amount for that child should be lis. 2d., but the Government has not seen fit to increase the amount of 5s. Thus, the family man has been left right out of the picture. The loss in that instance amounts to 6s. 2d. a week, or £16 0s. 8d. a year. In the case of other permissible children the amount paid in 1948 was £1. That amount should have risen to £2 4s. 10d., but the Government has left it at £1. The loss sustained is £1 4s. lOd. a week, or £64 1 ls. 4d. a year.
The Government has failed badly to maintain rates of pensions on the basis of purchasing power. What was the Government’s promise to the pensioners? It said it would keep the pension rate as high as the national economy could afford and, what was more important, it said that it would put value back into the £1. That promise has become famous. An attempt is made by the Prime Minister and his satellites to push it into the background.
They always refer to something on the horizon; but actually they have failed during their seven years in office to do anything about it. The position in relation to inflation, on the Government’s own admission, could not be worse than it is to-day. There are, of course, other matters which need to be examined. The Government parties have boasted of the number of returned soldiers in their ranks. But they have not a monopoly in that respect. There are just as many ex-servicemen in the ranks of the Opposition, but we do not boast of that fact. During election campaigns, the Government parties promised to the exservicemen a decent standard of living, but they have failed to honour that promise. Let us consider the case of the totally and permanently incapacitated ex-servicemen. If the nation can afford to give them anything at all, it should give them pensions that will enable them to enjoy the highest possible standard of living. Because of disabilities that they have suffered in the service of the nation, these pensioners are unable to work. Furthermore, they have additional needs. For some, special diets have to be prepared, and many of them are confronted with transport difficulties. Because of the low pensions paid to them, they have been hard hit by inflation. If it is necessary for the Government to obtain two and a half times as much revenue as formerly in order to carry on, logically the pensions of the totally and permanently incapacitated ex-servicemen should he two and a half times as much as formerly. It is of no use for supporters of the Government to argue about the matter. The plain fact is that these pensions have not been raised as they should have been.
This Government also promised that it would remove the onus of proof from repatriation pension applicants, but it has failed to do so. These provisions have been a running sore in our repatriation legislation, and although all political parties condemn them, they remain on the statutebook. When Labour relinquished office, shortly after the war terminated, the rehabilitation and repatriation benefits payable in Australia were considered to be particularly high. I emphasize that during the seven years that this Government has been in office it has taken no steps to remove the onus of proof requirement, despite the fact that every honorable senator on the Government side promised during election campaigns that this would be done if they were returned to office. Irrespective of the cost involved, this promise should be fulfilled as soon as possible. I have stressed before in this chamber the need to increase the pensions of partially blinded exservicemen. When their representatives interviewed the Minister for Repatriation (Senator Cooper), they received a most sympathetic hearing. The Minister promised to reconsider the amounts payable to them when the Commonwealth revenue and expenditure was under review. Whilst there may he some room for argument as to whether the loss of a leg is more serious than the loss of an arm, and so on, undeniably loss or partial loss of sight is a grave disability warranting substantial compensation. Very often the injury is such that there is a progressive deterioration of sight. Something must be done about this matter. Although it may have been considered behind closed doors, there is no provision in the budget to improve the position. Here again is an unfulfilled promise. Unless the Minister can assure me that he has done something about the matter, I must conclude that he did not pay sufficient regard to honesty when he was speaking to the representatives of these people. Although this budget reflects considerably increased costs in the community, it makes no provision to assist incapacitated ex-servicemen to maintain a decent standard of living.
At the time that the little budget was introduced, as well as during the campaigns which preceded the last two or three general elections, the Prime Minister (Mr. Menzies) exhorted the nation to produce more. The right honorable gentleman emphasized the necessity for us to step up exports and to obtain new overseas markets for our goods. He also said that it was necessary for us to reduce the costs of production. But what has been done about these matters? Nothing! This Government has a most shameful record in relation to reducing the costs of primary industry. I have been astounded that the members of the Australian Country party have been prepared to sit as stooges behind the Government, knowing full well that the primary producers were being ground into the dirt.
There is a tremendous carry-over of wheat in Western Australia, for which no market is available.
Supporters of the Government claim that it has adopted the recommendations of the Tariff Board in relation to subsidies on tractors. In fact, the Government has adopted only some of the recommendations and, by increasing tariffs ostensibly in order to protect Australian trade, it has involved the primary producers in extra expense. There have been complaints from the farmers’ organizations because, quite apart from money matters, they have been unable to obtain from the Minister for Trade (Mr. McEwen) certain information in relation to overseas trade. This information is being kept secret. There has been no explanation of the Government’s refusal to permit bilateral trade with certain other countries, or of the breaking of governmenttogovernment and other contracts. The Government has been reluctant to issue a statement on these matters. Apart from wool, which has held its own because of the world demand, the prices of primary products have gone haywire. Even the return from wool is not so good as it used to be, because of the ‘ increased cost of production. Although, on the one hand, the woolgrowers receive reasonable returns in terms of money, they do not get full value for their money.
There has been a suggestion - a very good suggestion - that we should engage in trade only with nations that are prepared to carry on reciprocal trading with us. The result of all sorts of government controls and restrictions is that, for trading purposes, some nations are regarded as privileged and others as putrid. But the supporters of the Government do not run their personal businesses as they conduct the affairs of the nation. The Government has a responsibility to arrange reciprocal trade as far as possible. Although I am convinced that the Government does not really believe that, because we refrain from selling goods to certain nations, those nations cannot obtain our products, it tries to persuade the public that that is the position. What actually happens is that the goods are exported to other countries which, in turn, sell to countries with which we are not trading. The result is that countries buying from us sell at a premium to countries with which we are not trading. In this way, they enjoy the cream of the market whilst Australia is obliged to accept lower prices than it should be enjoying. I do not say that this practice has been peculiar to the present Government’s term of office; it has been going on for some time; but the point is that this type of trade has grown during this Government’s administration. To give some idea of the damaging effects of this type of trade, I mention that when I was in Japan in 1 948, I saw some Australian wool of very poor quality and the Japanese were complaining that they had paid a terrific price for it. That wool could not have been bought by Japan direct from Australia. It had passed through the Bank of China and other British sources, eventually finding its way to the Japanese who were obliged to pay a terrific price for a very small quantity of very low-grade wool. I do not like having to say this, but it is a fact that certain people outside the Government who have tremendous influence with the Government are enjoying a huge rake-off from this type of trading, and it is wrong. We must trade on sound lines. For instance, if any honorable senator on the Government side who happened to have a business did not like, perhaps, Mrs. Smith up the road, he would not refuse to sell goods to her because he did not like her while, at the same time, being prepared to sell to nice Mr. Jones next door so that he might sell to Mrs. Smith for an extra 6d. No honorable senator would dream of trading in that way, yet that, in effect, is what is happening in connexion with the type of trading to which I have referred.
Both Italy and France have very favorable trade balances with this country. Both are willing to export to us goods which we need. They have even gone so far as to say that they would allow their trade balances to stand in an adverse position if we would engage in reciprocal trade with them; but we have not accepted the offer. That is not right. We have the goods to sell and we should trade. The Liberal party, which professes not to believe in controls is, in effect, imposing very effective controls upon free trade. The whole position merits thorough investigation.
There has been a good deal of criticism of the present Government’s attitude in connexion with defence expenditure, and it is deserving of criticism. I am not objecting to the amount it is proposed to spend because it is not nearly as much as the Labour Government was spending at the end of the war, but 1 do complain that the Government is not showing results for its expenditure. Much has been said about national development. I point out that the Labour government, by agreement with the States, launched the Snowy Mountains hydro-electric scheme as a defence project. That was the only way by which it could be done, and it is one of the biggest developmental schemes ever undertaken in Australia. It was boycotted at the outset by the Liberal party, and it is to the credit of two members of the Liberal party, George Rankin and Bernie Corser, that the boycott was broken; but the fact is that as a result of the delay brought about by the Liberal party’s boycott originally, the scheme is now costing an extra 33 per cent, due to the fact that costs have increased during the period of the delay. This Government severely embarrassed the chairman of the authority when it prevented him from entering into contracts for the purchase of materials. That involved extra cost because of increases in prices in the meantime.
The Labour Government also established and developed Trans-Australia Airlines, realizing that if we were faced with another war an efficient air transport system would be essential to effective defence. By developing that undertaking and making it profitable, we relieved the taxpayers of a certain amount of taxation in that the revenue derived from the operations of Trans-Australia Airlines meant that so much less was required from the pockets of the people. But the present Government has offset the effectiveness of this undertaking. It has restricted the development of TransAustralia Airlines. It has said that it can earn only a certain amount of money, that the trade must be shared with Australian National Airways Proprietary Limited, an undertaking that has no responsibility whatever in the event of war. I repeat that we do not quarrel with the amount being spent on defence; we quarrel with the manner in which it is being expended. I ask for leave to continue my remarks at a later date.
Leave granted; debate adjourned.
Senate adjourned at 4.27 p.m.
Cite as: Australia, Senate, Debates, 6 September 1956, viewed 22 October 2017, <http://historichansard.net/senate/1956/19560906_senate_22_s9/>.