Senate
1 October 1958

22nd Parliament · 3rd Session



The PRESIDENT (Senator the Hon. Sir Alister McMullin) took the chair at 3 p.m., and read prayers. assent to Bills.

Assent to the following bills reported: -

Australian Capital Territory Supreme Court Bill 1958.

Social Services Bill 1958.

Superannuation Bill 1958.

Defence Forces Retirement Benefits Bill 1958.

Repatriation Bill 1958.

Seamen’s War Pensions and Allowances Bill 1958.

Excise Bill 1958.

page 745

QUESTION

UNEXPLODED AMMUNITION

Senator TOOHEY:
SOUTH AUSTRALIA

– I preface my question to the Minister representing the Minister for the Army by saying that following a question I asked last week with reference to the discovery of a live shell on property which was once a firing range about 5 miles east of Murray Bridge, South Australia, I have been informed by the State member of Parliament for the district, Mr. Bywaters, that seven more shells have been found on the property in question during the last few days, at least two of the shell’s being alive. As an examination of the area by the Army some eighteen months ago following a near fatal accident failed to disclose the presence of these shells, does it not indicate that some degree of negligence was associated with the search? What action can be taken to guarantee the safety of the people who now farm the property? Will the Department of the Army compensate the owners of the property for the serious loss of value due to the presence of these shells?

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

– I shall ask the Minister for the Army to make some inquiries into the matter.

page 745

QUESTION

PAYMENTS TO MARITIME UNIONS

Senator LAUGHT:
SOUTH AUSTRALIA

– Will the AttorneyGeneral indicate whether he intends to direct the Crown Law officers to take any action following the presentation to the Senate of the report of the Senate select committee appointed to inquire into payments to maritime unions? If so, what action does the Attorney-General intend to take as a result of the serious matters disclosed by the committee?

Senator O’SULLIVAN:
Attorney-General · QUEENSLAND · LP

– At this stage I am not prepared to direct the Crown Law officers to take any action on this matter, but I shall ensure that they receive the report and such’ of the transcript as is available. I shall then ask them for their advice. In the light of the advice received, the Government will decide what action, if any, it will take.I shall certainly seek their advice.

page 745

QUESTION

ALUMINIUM

Senator O’BYRNE:
TASMANIA

– I direct my question to the Minister representing the Minister for Trade. Is it a fact that the Tariff Board has under consideration an application for tariff protection in relation to aluminium and aluminium products? By whom was the application made? When was it referred to the Tariff Board? Has the board yet completed its report? If not, when is it expected that the report will be available? Is the Government either contemplating or negotiating for the sale of the Bell Bay aluminium project to private enterprise? Has the Australian Aluminium Production Commission served a log of claims on unions whose members are employed at the Bell Bay works? Does this projected discard of the agreement hitherto operative between the commission and the unions forecast the taking over of the project by private enterprise?

Senator SPOONER:
LP

– The honorable senator has asked a rather silly lot of questions, but I shall do my best to answer them. Firstly, there is an application in regard to aluminium and aluminium products before the Tariff Board. Secondly, the application is before the Tariff Board following a request made by the industry, which was agreed to by the Minister.

Senator O’Byrne:

– Which industry?

Senator SPOONER:

– The aluminium industry itself.

Senator O’Byrne:

– By the Bell Bay commission?

Senator SPOONER.I could not say whether the application was made by the Bell Bay commission or not. I would hot think so, because it deals with aluminium; and aluminium products. Thirdly, the Tariff Board’s report has not been completed. Fourthly, some overtures have been made - there have been no negotiations - and 1 have made some representations concerning the future of Bell Bay. As the honorable senator should know, they have been made by arrangement with Mr. Cosgrove and the Tasmanian Government. The last question had something to do with an industrial award. I have no information on that, but any one with even limited intelligence would know that that would have nothing to do with any change of ownership of the Bell Bay undertaking.

page 746

QUESTION

BROADCASTING

Senator HANNAN:
VICTORIA

– I direct a question to the Minister representing the PostmasterGeneral. Has the Minister seen the recent press and magazine announcements of statements, attributed to President Eisenhower, that much of the trouble in the Middle East has been caused by inflammatory broadcasts from Radio Cairo, directed at an illiterate people, and also that many broadcasts from the free world are jammed by Communist countries for their own reasons? In view of the worldwide reputation acquired by Radio Australia, can the Minister advise me whether there are any reports of substantial jamming of its transmission by any country? Can the Minister advise the Senate whether Australia possesses jamming transmitters, which, in the event of inflammatory broadcasts being made by Peking or Indonesia, directed to any of the native peoples under Australia’s care, could be used for the protection of these people?

Senator COOPER:
Minister for Repatriation · QUEENSLAND · CP

– I regret that I am unable to give the honorable senator an answer to his question right away, but I shall bring it under the notice of my colleague, the Postmaster-General, and ask him to post the honorable senator a detailed reply.

page 746

QUESTION

GENERAL ELECTION

Senator BROWN:
QUEENSLAND

– I should like to direct one or two questions to the Leader of the Government in the Senate. Is it true that Mr. Menzies made it clear at the Liberal party conference that he would make a series of personal attacks on the political integrity of Dr. Evatt? Will such personal attacks call for reprisals and will Mr. Menzies be the target? Does not the stated attitude of Mr. Menzies concerning Dr. Evatt mean that Government supporters will have the all clear for emptying the slime and smear buckets on the doctor? Is it too much to ask that the Government parties keep the fight clean by avoiding personal attacks? Living as we are in such troublous times, under the shadow of the world-shattering bomb, and when the paramount necessity is for sanity in political matters, should we all not be anxious to keep the forthcoming political fight on the highest politically moral plane?

Senator O’SULLIVAN:
LP

– The last pari of the honorable senator’s question shows how hypocritical the whole question is. The Prime Minister has never engaged in personal attacks on the integrity of the Leader of the Opposition, or, as far as I know, on the integrity of anybody in public life. He is not likely to do so.

page 746

QUESTION

BEEKEEPING

Senator PEARSON:
SOUTH AUSTRALIA

– I address a question to the Minister representing the Minister for Primary Industry. Before doing so, I should like, with the indulgence of the Senate, briefly to explain the circumstances that lead up to the question. At a recent conference of beekeepers from all States of the Commonwealth, held at the Waite Agricultural Research Institute in South Australia, the need for research at the university level into the problems confronting the industry was stressed. Such problems as pollen feeding, diseases in bee colonies, bee breeding, &c, were cited as typical fields for such research work. It was suggested that the Waite Agricultural Research Institute was ideally situated and equipped to conduct such research. It was pointed out that the Commonwealth Government’s policy has been to subsidize contributions for research purposes by other primary industries, such as the wool, wheat and tobacco industries, in cases where the industry itself approves. t My question is: In the event of an approach being made to the Government along these lines by the beekeepers’ organizations, will the Minister ascertain from his colleague, the Minister for Primary Industry, whether he will meet representatives of the industry with a view to hammering out a scheme for such research work, similar to that which the Government has so willingly and successfully promoted in the case of the other primary industries I have mentioned?

Senator PALTRIDGE:
Minister for Shipping and Transport · WESTERN AUSTRALIA · LP

– 1 will inform my colleague, the Minister for Primary Industry, of the matter raised by Senator Pearson. I am sure he will give courteous consideration to the request.

page 747

QUESTION

OVERSEAS TRADE

Senator HENDRICKSON:
VICTORIA

– I preface my question, which is directed to the Minister representing the Treasurer, by saying that one of the tragic results of the Montreal trade talks was the unfortunate statement by the representative of the United Kingdom that it was intended to liberalize dollar imports into the United Kingdom. Does that mean that the magnificent role played by Australia over a number of years in conserving the resources of the dollar pool and in helping to fill this reservoir must be increased and that the Australian people must make greater sacrifices to enable England to enjoy dollar luxuries that will be denied to the people of Australia? Does it not mean that England is letting down those countries which saved the sterling area? The specific questions to which I should like an answer are as follows: - First, is it correct to say that European subsidized agricultural products are already spilling over into the British market and that Britain is safeguarding the European market for its manufactured products? Secondly, instead of Australian Ministers rushing around the world and beating the air with words, would it not be more effective for the Australian economy if the Government were to convene a conference in Australia of all interested organizations with a view to discussing ways and means of attempting to solve these terrific problems which seem to be worsening the longer the Menzies Government remains in office? I have made this suggestion on many occasions in my frequent questions relating to the European common market and the free-trade area.

Senator SPOONER:
LP

– I think I could reasonably start off by assuring the honorable senator that the Menzies Government will remain in office a lot longer. I interpret the amelioration of dollar imports in quite a different way from that adopted by

Senator Hendrickson. I remind the honorable senator that it was only a few months ago that we in Australia liberalized imports from the dollar area. Now Great Britain has liberalized such imports. I regard that as evidence of a strengthening of sterling, and that we are in a better position to liberalize those imports.

Senator Hendrickson:

– But not in the same categories.

Senator SPOONER:

– Different categories suit different economies. What we want may be different from what Great Britain wants. As to the second question, which related to an increase of trade in subsidized products from Europe and to British manufactures, I can only refer the honorable senator -to frequent statements, which were repeated at the Montreal conference, that it was the intention and objective of the United Kingdom to protect British dominions and the existing preference arrangements. The proposal that a conference be convened in Australia is an interesting one. T shall see that it is placed before the Minister for Trade.

page 747

QUESTION

LEAD AND ZINC

Senator HENDRICKSON:

– I direct the following questions to the Minister representing the Minister for Trade: - First, does the Government receive any warning from countries such as the United States of America before drastic cuts in our exports are made? Secondly, if no warning is received, will the Government include in all pacts and trade agreements a provision that ample notice be given when cuts similar to that which took place in respect of lead and zinc exports are made? Thirdly - this is a rather important question - is the Minister aware that warnings have been given by mining companies to their employees that production would have to be cut and that they would lose their jobs unless the Government took action to remedy the present situation?

Senator SPOONER:
LP

– Surely Senator Hendrickson is a month or sue weeks behind the times. He asks whether or not a warning is given. What was happening in regard to lead and zinc was world-wide news for months before the actual import quotas were fixed.

Senator Hendrickson:

– Where?

Senator SPOONER:

– There was the finding of the Tariff Commission in America, which was published in the Australian press. The commission brought forward two proposals, one of which was adopted by the American Administration but rejected by Congress. That led to the next step, the import cuts announced by the President.

Senator Hendrickson:

– So you knew, but did nothing!

Senator SPOONER:

– What nonsense! Everybody knew. The honorable senator had better go to night school, so that he may learn to read. Information about all that has been happening overseas and in Australia in this respect has been published in the newspapers. The honorable senator has asked whether we will make reservations in pacts, trade agreements and so on. That is already done in every pact or agreement. I have never heard such a silly request. There is no trade agreement that does not contain a provision that notice is to be given before the arrangements are changed. In regard to the question about mining companies, I point out that the mining companies at Broken Hill had reduced their output by 20 per cent.long before the American’ decision was made.

page 748

QUESTION

COMMONWEALTH HOSTELS

Senator TANGNEY:
WESTERN AUSTRALIA

– I address a ques tion to the Minister representing the Minister for the Interior. Is he aware of a statement which appeared in yesterday’s press to the effect that various hostels and hotels in Canberra were to pass from the control of the Department of the Interior to that of private enterprise? Is he also aware that such hostels and hotels last year showed a profit of nearly £5,000? If the decision of the Minister in this matter is final, can the Senate be informed of the steps that are being taken to safeguard the rights and privileges of employees who have given long and faithful service at those places? For instance, some of the employees of the Hotel Kurrajong have worked there for more than twenty years. Will the Minister also ensure that, if this change takes place, civil servants, workers and members of Parliament who are concerned will not be unduly penalized by the transfer?

Senator HENTY:
Minister for Customs and Excise · TASMANIA · LP

– I shall obtain the information from my colleague, Mr. Fairhall.

page 748

QUESTION

AUSTRALIAN AIRLINES

Senator BENN:
QUEENSLAND

asked the Minister for Civil Aviation, upon notice -

  1. Has the Government been asked to lend money to Ansett-A.N.A. for the purchase of Electra or Viscount aircraft, and, if so, what decision has been reached?
  2. Will the Minister give an assurance that further public money will not be advanced to this airline without a complete investigation into the company’s present financial situation and the profitability or otherwise of its operations?

Senator PALTRIDGE.I now supply the following answer: -

No. The nature of the assistance requested by Ansett-A.N.A. for the purchase of Electra aircraft will be explained in connexion with the Airlines Equipment Bill.

page 748

QUESTION

EGGS

Senator McMANUS:
VICTORIA

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

In view of allegations made by Mr. Talbot, president of the Victorian branch of the Associated Poultry Farmers of Australia, on a television session, “ Meet the Press “, in Melbourne on Sunday, 17th August, will the acting Minister advise whether it is a fact - (1) that the British Government offered to agree to pay 4s. a dozen for Australian eggs; (2) that the Australian Minister for Trade refused to accept that agreement; (3) that, as a consequence, Australian eggs are now being sold in Britain for1s.10d. a dozen?

Senator SPOONER:
LP

– The acting Minister for Trade has supplied the following answers to the honorable senator’s questions: -

  1. The 1952-53 season was the last season in which eggs in shell were purchased from Australia under contract by the United Kingdom Ministry of Food.In that season the contract prices, on an f.o.b. Australian ports basis, were - 3s. 10.9d. a dozen for the 14-lb. pack; 4s. 2.2d. for the 15-lb. pack, and 4s. 5.6d. for the 16-lb. pack. The United Kingdom Ministry offered to purchase 1953-54 shell egg exports at the same prices which had applied in 1952-53. 2.The then Minister for Commerce and Agriculture, in accordance with the Government’s policy of securing the concurrence of producers in respect of any proposed contracts for sale on a governmental basis, asked the Australian Egg Board whether the offer should be accepted. The Australian Egg Board, which was constituted predominantly of elected producer representatives, after considering the matter, advised against the acceptance, and accordingly the offer was declined. It was finally decided to sell Australian eggs in the UnitedKingdom on the open market. This was the desire of the industry.
  2. The price of1s. l0d. sterling a dozen may refer to the rock-bottom price in the United Kingdom to which Australian eggs fell for a short time some years ago. The price received for a recent sale of Australian shell eggs on the United Kingdom market was 33s. sterling per long 100. This price is equivalent to approximately 2s. l1d. a dozen f.o.b. Australian ports.

page 749

QUESTION

TRADE WITH JAPAN

Senator WEDGWOOD:
VICTORIA

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

  1. Is it a fact that the United States of America has sent a continuous flow of productivity missions to European and other countries, and that in 1955 the Japanese productivity centre - based upon the European productivity centres - was formed?

    1. Is it further a fact that the Japanese centre was backed by the United States Government, by Japanese subsidies and by assistance from private industry?
    2. Is it also a fact that, since its formation three years ago, it has sent almost 1,000 Japanese businessmen to the United States of America to study the operations of American industry, and has invited some 60 experts to study productivity problems in Japan?
    3. Has such a centre been established in Australia; if not, will the Government give some consideration to the formation of such a centre?
Senator SPOONER:

– The acting Minister, for Trade has furnished the following reply: -

During the last ten years productivity missions have been constantly going to the United States from the United Kingdom, Europe and other areas to study American manufacturing and managerial techniques. At the same time American technical and managerial consultants have visited the countries in which productivity centres have been formed.

A Japanese productivity centre was formed in 1955, and I have asked the Trade Commissioner for further information on its activities and the support it has received from the United States Government, the Japanese Government and private industry. I will pass this information on as soon as it is received.

The Government has given a great deal of consideration to the general problem of improving industrial efficiency and increasing the productivity of industry. In. particular, my colleague, the Minister for Labour and National Service, has discussed the problem with representatives of industry, both of management and employees, and on the Ministry of Labour Advisory Council, That council issued an important statement emphasizing and endorsing the importance of, and the need for higher productivity to develop measures to increase productivity in Australian industry. The standing committee has done valuable work in making more widely known the importance of increased productivity. Because of a decision of the Australian Council of Trade Unions that its members should not participate in the proceedings of the council, no meeting of the council or its standing committee has been held in recent months. At the time this decision was made the standing committee had arrangements almost completed to give effect to a plan negotiated by my colleague’s department which would have involved teams drawn from the ranks of management and the trade unions going to the United States of America to study productivity and related matters in United States industry. For the time being this plan is in abeyance. Some consideration has been given, in the light of the activities of productivity organizations in other countries, to the question of establishing a productivity centre in Australia, but as the Ministry of Labour Advisory Council has pointed out, Australian conditions differ in some important respects from those of other countries, and these differences are very relevant in determining the priorities to be accorded in the development of productivity promotion activities.

page 749

QUESTION

TARIFF BOARD REPORT ON TIMBER

Senator McKENNA:
TASMANIA

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

  1. Has full consideration yet been given to suggestions made by the Tariff Board in its report of 22nd April last on the timber industry to the effect that the Government should subsidize freight charges on timber exported from Western Australia and Tasmania?
  2. Were representations made to the Minister by timber interests in Sydney on 20th June last?
  3. When will the Government make a decision . regarding the Tariff Board’s recommendation?
Senator SPOONER:
LP

– The acting Minister for Trade has furnished the following answers to the honorable senator’s questions: -

  1. In the report referred to, the Tariff Board drew attention to the disabilities of the Western Australian and Tasmanian sections of the Australian timber industry arising out of sea freights. The board did not suggest that the Government should subsidize those freights, although it did mention that a reduction in freight or a freight subsidy would improve their competitive position. These matters are still under consideration.
  2. Yes.
  3. As indicated in 1, the board made no recommendation on this matter. The Government will, however, make a decision on the matter raised by the board as soon as the problem can be fully examined.

page 749

QUESTION

CHARTER OF ANTARCTIC SHIPS

Senator KENDALL:
QUEENSLAND

asked the Minister representing the Minister for External Affairs, upon notice -

  1. What is the cost per month of chartering each of the three vessels “ Kista Dan “. “ Thala Dan “ and “Magga Dan”?
  2. What is the total cost to date for the charter of each of these vessels employed on Antarctic work since the establishment of Australian bases at Mawson, Heard Island and Macquarie Island?

SenatorO’SULLIVAN.- The acting Minister for External Affairs has supplied the following answer: -

  1. The three Danish vessels mentioned are chartered on a daily basis by the Antarctic Division of the Department of External Affairs.
  2. The cost of chartering these vessels has been - “ Kista Dan “, chartered 1953-54 at £470 a day, total £54,962. “ Kista Dan “, chartered 1954-55 at £470 a day, total £49,901. “ Kista Dan “, chartered 1955-56 at £535 a day, total £62,984. “Kista Dan”, chartered 1956-57 at £535 a day, total £61,249. “Thala Dan”, chartered 1957-58 at £662 a day, total £81,111.

Total to date, £310,207.

During the 1958-59 season “Thala Dan” and “ Magga Dan “, at £662 and £645 a day respectively, will be used.

page 750

QUESTION

ALMONDS

Senator HANNAFORD:
SOUTH AUSTRALIA

asked the Minis ter representing the Minister for Trade, upon notice -

Has the inquiry by the Tariff Board into the matter of protection for the Australian almond industry yet been completed and if so, when are its recommendations likely to be released?

Senator SPOONER:
LP

– The acting Minister for Trade has supplied the following answer: -

The Tariff Board has completed its inquiry into the question of assistance to the Australian almond industry and I have recently received its report on the subject. The report is at present under consideration.

page 750

QUESTION

AUSTRALIAN BROADCASTING COMMISSION

Victorian Symphony Orchestra

Senator McMANUS:

asked the Minister representing the Treasurer, upon notice -

  1. Has any decision yet been reached on the request made for Commonwealth assistance to enable the Victorian Symphony Orchestra, sponsored by the Australian Broadcasting Commission, to accept the invitation recently tendered to it to make a cultural lour of Japan?
  2. If no decision has yet been reached, can it be expedited, as the scheduled period for the tour is the New Year and time is running short?
Senator SPOONER:
LP

– The acting Treasurer has supplied the following answer: -

There has been no formal request to the Commonwealth Government for financial asssitance to enable the Victorian Symphony Orchestra to visit Japan. In the absence of such a request, and without further knowledge of the proposal, the Government is not in a position to consider the matter.

page 750

QUESTION

ANTARCTICA

Senator WEDGWOOD:

asked the Minister representing the Minister for External Affairs -

  1. Is it a fact that Australia is to take over the United States antarctic station at Wilkes?
  2. If so, (a) when is it anticipated that the takeover will be effected, and (b) will the use of the station by Australia be for a limited period, or is it in the nature of a “ timeless loan “ by the United States of America to Australia?
Senator O’SULLIVAN:
LP

– The acting Minister for External Affairs has supplied the following answers: -

  1. On 7th May this year a statement was issued by the Australian and United States Governments announcing that the two Governments had agreed to co-operate in maintaining operations at Wilkes station after the end of the International Geophysical Year on 31st December, 1958. For this purpose the United States Government is contributing all the buildings and facilities of the Wilkes station and all of the supplies, fuel and food remaining at the station at the end of the International Geophysical Year. The Australian Government, on its part, has agreed to provide the logistical and administrative services needed for the continued operation of the station. Scientists from both countries will participate in the programme of technical studies, research and scientific observations to be carried on at Wilkes station. It is anticipated that the take-over will take place in early February, 1959.
  2. It will remain within the power of the United States Government to ask for the return of the facilities, but it is not thought that this contingency will arise.

page 750

QUESTION

AUSTRALIAN NATIONAL SHIPPING LINE

Senator HANNAN:

asked the Minister for Shipping and Transport, upon notice -

  1. Are any of the five Australian National Line ships, at present without cargoes, suitable for the carnage of motor car bodies and chassis between capital cities?
  2. If so, in view of the greatly improved relations in the shipping industry between capital and labour, will the Minister consider the possibility of an attempt to secure this freight which should be cheaper than road transport and which would greatly reduce the wear and tear on main highways?
Senator PALTRIDGE:
LP

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

  1. Any or all of the National Line ships at present laid up could be used for the carriage of motor bodies and chassis and in fact they have been so used in the past.
  2. Before these vessels were laid up and since that date the National Line has explored every possibility of finding suitable cargoes for these vessels, including the possibility of using them for the transport of motor bodies. At the present time this class of cargo is lifted as part cargo by vessels now in commission and the National Line’s examination of the position has indicated that the diversion of this proportion of the available motor body cargo to other vessels would seriously impair the earning capacity of vessels in commission. The examination also disclosed that it would not be economically justifiable to recommission the comparatively large “ River “ class vessels for the sole purpose of lifting motor car bodies and chassis.

page 751

QUESTION

DAIRYING

Senator O’SULLIVAN:
LP

– Yesterday, Senator Courtice asked me the following question, without notice -

In view of the serious economic position of the Australian dairying industry, will the Leader of the Government indicate to the Senate, before the closing of Parliament, whether the Government intends to take action to assist the industry in its present crisis, a crisis which has been caused by inflationary conditions for which the industry cannot be held responsible, but for which the Government must accept a large measure of responsibility?

I replied -

I am aware that the subject raised by the honorable senator is one to which my colleague, the Minister for Primary Industry, has given very earnest and serious consideration. I shall be pleased to bring the honorable senator’s question to his notice. 1 have now received the following reply from the Minister for Primary Industry: -

The Government is concerned about the difficulties existing in the dairy industry. The principal reasons for the current situation are not as suggested in the honorable senator’s suggestion, but the continued low returns from export sales and the after effects of the drought which struck many dairying districts during 1957-58. To help alleviate the position, the Government has decided to underwrite a return on total production of butter and cheese for the 1958-59 season which will enable the average butter factory to pay producers a minimum of 40d. per lb. commercial butter basis when the pool is finalized. This decision will ensure producers of an increase of at least 3d. per lb. over the present interim return of 37d. per lb. The guarantee has a potential liability for the Commonwealth and is additional to the Commonwealth subsidy to the industry of £13,500,000 for 1958-59.

In addition, the Government will be prepared to consider applying the same principle of underwriting a final equalized return for the remaining period of the five years stabilization scheme at levels ‘ determined after examination of all relevant factors. The fundamental problems of the industry - high cost production, land development problems, competition from substitutes and depressed overseas prices - must be tackled largely by the industry itself. The Australian Agricultural Council meeting on 9th and 10th October is to give consideration to proposals related to these problems.

page 751

QUESTION

BUTTER

Senator WEDGWOOD:

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

  1. Is it a fact that one Victorian butter factory is exporting tinned butter to Malta, Rangoon, Singapore and countries near the Arabian Sea?
  2. What was the value of butter exported to Asia and South-East Asia during the last financial year?
  3. What action is the Commonwealth Government taking to promote increased sales of butter to our Asian neighbours?
Senator SPOONER:
LP

– The acting Minister for Trade has furnished the following answers to the honorable senator’s questions: -

  1. Yes, this is correct.
  2. The value of butter exports to Asia, expressed in £ Australian f.o.b., in 1957-58 was £1,651,152. Of this £893,423 went to South-East Asian countries.
  3. Efforts have been made to expand the sales of Australian butter to Asia. For example, in 1957, Australian butter was featured at the Tokyo Trade Fair. However, at present time, the economic difficulties of most Asian countries is a limiting factor to the expansion of trade in this area. Sales of our butter to Malaya and Ceylon have increased during the last few years. As a result of the recently completed Trade Agreement with Malaya, Australian butter is now accorded a margin of preference in the rate of duty payable. The dairy industry is planning to spend £250,000 a year on sales promotion and research and the Commonwealth Government will contribute an amount equal to the amount expended on research. This expenditure should maintain our position as a large butter exporter notwithstanding the intense competition due to the present world surplus of dairy produce.

page 751

QUESTION

RICE

Senator BUTTFIELD:
SOUTH AUSTRALIA

asked the Minister representing the Minister for Primary Industry, upon notice -

  1. Does Australia grow sufficient rice for domestic consumption?
  2. How much rice per head per year is consumed in Australia?
  3. Does Australia export rice?
  4. What is the acreage under cultivation and the output per acre from the Murrumbidgee area?
  5. Is any more land suitable for rice cultivation available in the Murrumbidgee area?
  6. What acreage is at present under cultivation in the Humpty Doo area, what was last season’s yield, and what acreage is expected to be under cultivation in that area next season?
Senator PALTRIDGE:
LP

– The Minister for Primary Industry has supplied the following answers: -

  1. Yes.
  2. About 41/2 lb. of table rice.
  3. Yes.

  1. The area is controlled by the State according to the water available, the needs of other crops, and sound farming practice.
  2. In the Humpty Doo area about 5,285 acres are now under cultivation of are expected to be put under cultivation in the 1958-59 season; the yield last season - 1957-58 - was about 330 tons from approximately 297 acres; no firm indication is yet available of the acreage expected to be under cultivation in the 1959-60 season.

page 752

QUESTION

TEXTILES

Senator MARRIOTT:
TASMANIA · LP

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

  1. Is it a fact that there has been some unemployment in the textile industry in Tasmania and that a shorter working week has been temporarily introduced?
  2. Is it a fact that this situation has caused the Government some concern?
  3. Can the Minister state what the situation is at the present time, and what the indications are for the future prosperity of this industry?
Senator SPOONER:
LP

– The acting Minister for Trade has furnished the following answers to the honorable senator’s questions: -

There has been some reduction this year in employment in the textile industry. In addition, some short time has been worked.

The Government is naturally concerned that textile mills have been forced to work short time.

Recent reports from textile mills in Tasmania Indicate that the employment position is now improving. A report from one of the major producers, which was working short time recently, indicates that the company shortly expects to go on a five-day double shift production schedule. Most sections of the textile industry are highly competitive, and the future of the industry is largely dependent on such factors as the ‘ direction of consumer spending, the cost of wool, the increased use of synthetic materials and the general level of economic prosperity.

page 752

CANCER RESEARCH

Senator COOPER:
CP

– On 23rd September,

Senator Tangney:

asked the following question: -

Is the Leader of the Government in the Senate aware of the suggestion made by Sir Macfarlane Burnet on Sunday evening in a broadcast talk that a commission similar to the Murray commission of inquiry on Australian universities be set up to investigate medical research in Australia, particularly biological and medical research in relation to cancer? In view of the increasing death rate from this scourge, will the Government consider the appointment of such a commission?

The Minister for Health has now furnished the following reply: -

The honorable senator may be assured of the Government’s interest in research in regard to both cancer and other ailments. I am in agreement with Sir Macfarlane Burnet’s views on the importance of pure scientific research as the basis of improved knowledge and progress in treatment. I am quite prepared to consider any scheme for co-ordinating the activities of various research workers throughout Australia and to discuss it with the National Health and Medical Research Council, which is already active in this same field.

page 752

REPATRIATION GENERAL HOSPITAL, HOBART

Report of Public Works Committee

Senator O’BYRNE:

– I present the report of the Public Works Committee on the following subject: -

Construction of extensions to the Repatriation General Hospital at Hobart, Tasmania.

The inquiry into this matter was completed two days ago and, because of the nature of the project, the report has been presented before the close of the session. The portion of the hospital that is to be replaced by the work mentioned was taken over from the Department of the Army in 1920. The existing buildings are of wooden construction, and compared with present-day structures, are sub-standard. Their replacement previously could not be effected because of lack of funds and priorities given to other departmental projects.

The evidence placed before the committee highlighted the inadequacy of the old wooden buildings, and the superintendent of the hospital stated that he was horrified at the condition of the buildings, which are lacking in essential facilities. There is no isolation ward, and a grave risk exists of airborne infection arising from the nature of the structures. The committee, therefore, has recommended that the project be proceeded with as a matter of urgency. On present day values the extensions are estimated to cost £220,000.

The proposed site for the buildings is most convenient, and the plans indicate that the structure will be both adequate to meet requirements and pleasing in appearance.

Ordered to be printed.

page 753

INTERNATIONAL LABOUR CONFERENCES

Report of Australian Delegates - Australian Government’s Proposals

Senator SPOONER:
New South WalesMinister for National Development · LP

– On behalf of the Minister for Labour and National Service (Mr. Harold Holt), and the acting Minister for External Affairs (Sir Philip McBride), I lay on the table of the table of the Senate the following paper: -

Reports of the Australian Government, Employers’ and Workers’ Delegates to the Fortyfirst (Maritime) and Forty-second Sessions, Geneva, 1958.

In the interests of economy, I do not propose to move that the reports be printed. Copies will be available to honorable senators from the parliamentary officers. Following the practice initiated by the Minister for Labour and National Service some years ago, the Senate will be informed at a later date of the action taken, or proposed to be taken, in respect of the conventions and the recommendations adopted by these conferences.

On behalf of the Minister for Labour and National Service, I also lay on the table the following paper: -

Statement in relation to the Convention and Recommendations adopted by the 38th and 39th Sessions of the International Labour Conference.

In the interests of economy, I do not propose to move that the paper be printed. Copies will be available to honorable senators from the Clerk of the Papers.

page 753

QUESTION

INTER-PARLIAMENTARY UNION

Senator LAUGHT:
South Australia

– by leave - I lay on the table the following paper -

Report of the Australian delegation to the 47th Conference of the Inter-Parliamentary Union, held at Rio de Janeiro, July to August, 1958, and move -

That the paper be printed.

I should like to make a few brief remarks concerning, this matter. The Australian delegation to the conference comprised three members from the Government parties and three from the Opposition parties. Senator Harris and I were the senators in the delegation. The report which I have tabled indicates, among other things, that there were 277 delegate members present, representing 46 national groups. The topics discussed included the strengthening of peace, principles governing the investment of foreign capital in countries in the process of economic development, cultural exchanges between countries, and1 freedom of information.

I can speak with appreciation of the conference and the value of the contact made between delegates, both inside and outside the conference room. I commend the report for the earnest consideration of the Senate. I ask for leave to continue my remarks at a Inter stage.

Leave granted; debate adjourned.

page 753

COAL INDUSTRY BILL 1958

Bill returned from the House of Representatives without amendment.

page 753

COCOS (KEELING) ISLANDS BILL 1958

Message received from the House of Representatives, intimating that it had agreed to the amendments made by the Senate in this bill.

page 753

LOAN BILL 1958

Bill received from the House of Representatives.

Standing Orders suspended.

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

Second Reading

Senator PALTRIDGE:
Minister for Shipping and Transport and Minister for Civil Aviation · Western Australia · LP

– I move -

That the bill be now read a second time.

As was explained in the recent Budget speech, the Government is budgeting this financial year for an overall cash deficiency of £110,000,000. That is to say, total receipts of the Commonwealth from revenue, public borrowings and other usual sources are expected to fall short of total expenditure commitments by £110,000,000. The intention is to finance this deficit by borrowing from the central bank by the issue of treasury-bills. In this bill the authority of Parliament is sought to make the borrowing of £110,000,000 required to meet the estimated deficit, and to expend the proceeds of the borrowing.

The manner in which the proceeds of the borrowing will be applied was explained in the Budget speech and in Statements 2 and 4 attached to the speech. They will be used to finance expenditure on defence services to the extent of £78,000,000 and to finance redemption of maturing securities to the extent of £32,000,000. The maturing securities, redemptions of which are to be financed from the proceeds of the borrowing, are Commonwealth securities that were issued for war purposes. The borrowing, therefore, is wholly for defence purposes of the Commonwealth.

Total expenditure on defence services in 1958-59 is estimated at £190,000,000. Details of this estimated expenditure are set out in Part 1 of the second schedule to the Appropriation Bill 1958-59. Of the total estimated expenditure of £190,000,000, an amount estimated at £78,000,000 is to be charged to loan fund, where it will be financed from the funds raised under the authority of this act. A similar procedure of charging part of defence expenditure to loan fund was followed in some of the war and early post-war years, when total estimated receipts were inadequate to meet total estimated expenditure.

It is estimated that, in addition to utilizing the current receipts of the National Debt Sinking Fund, it will be necessary to call on the balances in the Loan Consolidation and Investment Reserve and the Sinking Fund to the extent of £32,000,000 to finance redemptions of Commonwealth securities issued for war purposes. The borrowing will enable this to be done by providing cash for the realization of some of the investment of these funds. I commend the bill to honorable senators.

Debate (on motion by Senator McKenna) adjourned.

page 754

AIRLINES EQUIPMENT BILL 1958

Bill received from the House of Representatives.

Standing Orders suspended.

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

Second Reading

Senator PALTRIDGE:
Minister for Shipping and Transport and Minister for Civil Aviation · Western Australia · LP

– I move -

That the bill be now read a second time.

During recent months, the major domestic airlines - Trans-Australia Airlines and Ansett-A.N.A. - have placed orders for more than £18,000,000 worth of aircraft equipment, most of which is due for delivery before the end of 1959. T.A.A. will buy two Lockheed Electra aircraft, two 800 Series Viscounts and twelve Fokker Friendships, while Ansett-A.N.A. will buy two Lockheed Electra aircraft, four 800 Series Viscounts and six Fokker Friendships.

These orders raise acute financial problems of a very similar nature for both operators which can only be satisfactorily solved with some measure of Government assistance. The purpose of the Airlines Equipment Bill 1958 is to authorize the Commonwealth to give such assistance under terms and conditions which will ensure the stability of the domestic air transport industry and promote the objectives of the Civil Aviation Agreement Acts of 1952 and 1957 approved by this Parliament. It will be recalled that the purpose of this legislation as set out in the agreements is to ensure: -

  1. the continued existence of the company, as well as of the commission, as an operator of airline services within Australia;
  2. the maintenance of competition between the commission and the company; and
  3. the efficient and economical operation of air services within Australia.

I turn first to the measure of assistance which we seek for the commission. The commission’s re-equipment programme will cost approximately £10,000,000. The Commission’s capital is £4,870,000, including the sum of £500,000 made available in June, 1958, for the purpose of meeting, deposits on new equipment. An additional £ I. ,000,000 capital is to be appropriated in the current Budget, which the commission urgently requires for the same purpose. It is intended to make this available as soon as practicable after the approval of this bill, thus bringing the Commission’s capital to £5,870,000. Nothwithstanding this additional capital, the commission will still have a cash deficiency at the peak of its reequipment programme of approximately £5,000,000. This bill contains provisions which will completely meet the commission’s requirements.

At present, the commission can borrow under section 31 of the Australian National Airlines Act 1945-1956 up to £1,000,000, but only for temporary purposes on bank overdraft. It is proposed to replace this section by a new section which authorizes the commission to borrow up to a sum not exceeding in aggregate £3,000,000 at any one time, and to authorize the Treasurer, in appropriate circumstances, to lend up to this amount in the form of interest-bearing Treasury advances or to guarantee repayment of loans up to that amount. These extended powers will be used initially to assist in financing the two Vickers Viscount 800 Series aircraft and also some of the Fokker Friendship aircraft.

In addition, Parliamentary approval is sought for arrangements in respect of the two lockheed Electra aircraft, which will give the commission access to the equivalent of £2,350,000 in United States currency. First, the Commonwealth has negotiated a loan of 3,000,000 dollars (£1,350,000 Aust.) from J. P. Morgan and Associates at 4J per cent., and the Commonwealth proposes to re-lend this amount to the Commission at the same rate of interest repayable over a period of five years. Approval for this loan is being sought in the Loan (Australian National Airlines Commission) Bill 1958, while approval to re-lend the proceeds of the loan to the commission is sought in this bill.

The Commonwealth has also negotiated a loan for 13,000.000 dollars in United States currency to enable Qantas to purchase five Lockheed Electra aircraft. Approval for this loan is being sought in the Loan (Qantas Empire Airways Limited) Bill 1958. Because of arrangements recently concluded with the New Zealand Government under which Qantas . will use’ the excess capacity of TEAL’s three Electra aircraft, Qantas will now require four instead of five Lockheed Electra aircraft. Rather than reduce the Qantas loan, which is on very favorable terms, to the amount necessary to finance four Electra aircraft, an arrangement is proposed, with the consent of the lenders, under which the commission will buy the surplus Electra aircraft from Qantas and pay Qantas interest and principal corresponding exactly with the Qantas commitment in respect of that aircraft under the loan agreement. In addition to obtaining the benefit of the very favorable interest rates, the commission will receive credit of 2,250,000 dollars (£1,000,000 Aust.) under this arrangement.

To sum up, subject to approval of this bill, T.A.A. will have received, for purposes of re-equipment, the following government support: - Additional capital of £1,500,000, of which it received £500,000 in June, 1958; the proceeds of a 3,000,000 dollar loan from J. P. Morgan and Associates at 4£ per cent, for one Electra; credit of 2,250,000 dollars at a similar interest rate, from funds originally raised on behalf of Qantas; and the right to borrow a further £3,000,000 in the form of interest-bearing treasury advances or government guaranteed loans.

This support, in various forms, gives the commission access to £7,000,000 of additional government funds or governmentguaranteed loans to cover its reequipment programme. I think it is fair to say - and, indeed, to emphasize - that these arrangements, if approved by Parliament, will fully meet all requests by the commission for assistance to enable it to re-equip. I should also point out that, if the bill is not approved, the commission will not be in a position to proceed with the full reequipment programme it needs to maintain its competitive position.

I turn now to outline the re-equipment problems of Ansett-A.N.A. The present management of this organization is very sensitive to its urgent need to acquire the turbo-prop aircraft necessary to give it fleet parity with the commission, and has taken positive steps towards this end. As I have1 already indicated, it has obtained’ approval for the purchase of two Lockheed Electras, four Viscount 800 Series, and six Fokker Friendship aircraft, involving the early disposal of two DC6 aircraft and one DC6B aircraft during 1959. However, the private airline has substantially similar financial needs to the commission and would be greatly handicapped in financing the projects without some forms of assistance. If government guarantees are available, a greater percentage of the total outlay for aircraft and spares can be borrowed and lower interest rates can be negotiated, although not as low as the Commonwealth has been able to obtain on the money it borrowed on behalf of T.A.A. and Qantas. A longer period for repayment can also be obtained. lt will be recalled that the Civil Aviation Agreement of 1952 authorized Australian National Airways Proprietary Limited to borrow, with the assistance of government guarantees, or in certain circumstances Treasury advances, up to £4,000,000 to purchase an equal number of heavy aircraft comparable in type and price to those authorized for purchase by the commission. This clause clearly recognized the difficulty of the private company raising capital or obtaining loans when in competition with a government instrumentality which has all its needs met from government sources.

Since 1952, the prices of aircraft, including spares, of comparable capacity have almost trebled, and the measure of assistance which we now propose to give to the commission is of such magnitude that, to maintain the relativity established in 1952, it is clearly necessary to review the limits then imposed on the level of guarantees available to the private operator. I should, perhaps, point out that the practice of governments guaranteeing the purchase of aircraft and related equipment is being resorted to in many countries - for example”, the United States, where the Government has enacted special legislation authorizing the Civil Aeronautics Board to guarantee aircraft-purchase loans.

After taking into account all these matters, it is considered fair and equitable to offer Ansett Transport Industries Limited guarantees for the purpose of enabling the purchase of two Lockheed Electra aircraft of loans not exceeding £3,000,000 and repayable over a period not exceeding seven years, and for the purpose of enabling the purchase of six Fokker Friendship aircraft and related spare parts, loans not exceeding £2,000,000 and repayable over six years. These guarantees are in addition to the contractual entitlement of AnsettA.N.A. to guarantees under clause 3 of the Civil Aviation Agreement under which, at the present time, a balance of £1,300,000 remains available for further guarantees. Ansett-A.N.A. proposes to seek assistance under that clause to facilitate the financing, in part, of two Vickers Viscount 800-series aircraft.

It is most important to appreciate that while the commission receives the greater part of its assistance in hard cash - in the form of capital or the proceeds of loans negotiated by the Commonwealth on its behalf - the assistance proposed for the private operator is limited to guaranteeing repayment of loans which it negotiates on its behalf. Unless there is a default the Commonwealth will, at no stage, be responsible for providing any funds for the private airline. If there were default, the Commonwealth has an adequate security over the aircraft which will ensure that, in any event, it will not be involved in loss as a result of the giving of the guarantees.

It will be noted from the bill that very strict conditions will attach to the guarantees. In particular, the money must be borrowed on reasonable terms; the lender is to take proper security over the aircraft; the loan arrangements must contain provisions transferring the benefits of the securities to the Commonwealth if the Commonwealth is called upon to make payments under the guarantees; and the Treasurer may impose any other conditions he considers necessary to protect the interests of the Commonwealth. The aircraft must be fully insured and cannot be sold, mortgaged, or otherwise charged, and cannot be taken outside Australian territory except after furnishing such security as the Treasurer may require. In addition to these financial conditions, it is a condition of any guarantee that Ansett Transport Industries Limited enter into certain obligations relating to its aircraft fleet. If, and for so long as Ansett-A.N.A. is bound by these obligations, the commission is by force of provisions in the proposed legislation similarly bound, but not otherwise.

These obligations all relate to the “ quality “ and “ quantity “ of aircraft capacity to be provided by the two major domestic operators. The Government has already taken decisions which set the qualitative pattern of domestic airline services. It will be recalled that, originally, the commission proposed to purchase two Caravelle aircraft and Ansett-A.N.A. four Lockheed Electra aircraft. The Government rejected both these requests since it was quite clear that the stage would be set for a struggle by each airline to out-equip the other, regardless of the capital cost involved.

In the domestic field, where there are only two major operators, the pre-requisite for stability is to achieve adequate and comparable front-line equipment and then to ensure that such equipment is used for a reasonable period before being replaced, thus reducing to a minimum the heavy capital investment involved in airline operations. When these principles were made clear to the operators they finally agreed to purchase two Lockheed Electra aircraft each and to build the remainder of their fleets around Viscounts and Fokker Friendship aircraft, both of which have RollsRoyce Dart engines.

What I might term, the quantitative aspect of aircraft capacity is simply the number of revenue traffic ton miles which the aircraft fleets are capable of providing in a given period at a particular revenue load factor. In general terms, the load factor is the ratio of aircraft capacity actually used to aircraft capacity provided and available for use on a given route during a specified period. If profitable load factors are to be achieved, it is essential that the combined capacity of the T.A.A. and Ansett-A.N.A. fleets does not exceed the capacity necessary to perform the aviation task in this country. Both airlines firmly and unreservedly support this proposition.

Part IV. of the bill sets up machinery to ensure that the two airlines do not provide excess capacity. First of all, an estimate is to be made of the traffic on competitive and non-competitive routes during a specified period. A determination will then be made on the basis of an optimum revenue load factor of the aircraft capacity necessary for the commission and the company respectively to carry one-half of the total traffic on competitive routes and to operate its noncompetitive services during that period.

In the light of this determination, the two operators will then be mutually bound during the period in which any guaranteed loans are not repaid in full by three obligations. First, neither airline must provide on competitive routes, during the specified period, more aircraft capacity than is necessary to carry half the estimated traffic at the predetermined revenue load factor. Secondly, the operators must dispose of any aircraft capacity in excess of- that required to operate their competitive and noncompetitive services after making due allowances for the need for stand-by aircraft, maintenance and overhaul of aircraft, and crew training and similar matters.

Finally, there is an obligation on the airlines not to acquire additional aircraft which would result in the capacity limitations being exceeded, and not to introduce aircraft of a type which, having regard to the types already in operation, would1 be detrimental to the stability of the air transport industry. This latter obligation is, of course, designed to stop a wasteful re-equipment race leading to a multiplicity of new and expensive aircraft types. These obligations have been discussed in detail with representatives of the two airlines and they have indicated that not only do they support control of aircraft capacity along the lines proposed, but regard some such form of control as essential for the future stability of the Australian domestic air transport industry.

Nothing in the bill affects existing rationalization machinery- established under the civil aviation agreements. This machinery will continue to be used to determine routes, time-tables and fares and freight rates, and related matters, but the task of co-ordination will be greatly simplified because aircraft capacity of the airlines has first been pegged to the amount necessary to perform the domestic air transport task. It is most important to appreciate that this system will intensify rather than reduce competition. Although there is a limitation on the aircraft capacity to be provided, there is no other limitation on the amount of traffic which either airline can carry.

Currently, the total annual revenue on competitive routes is £19,000,000. Although the airlines will provide, on an equal basis, the capacity necessary to carry this traffic at a specified optimum revenue load factor - it will probably be in the vicinity of 70 per cent. - they are each free to carry as much of the business as they can attract on their authorized capacity. A shift of only 1 per cent, in the traffic is equivalent to a revenue increase, without significant extra cost, of £190,000, so that there will be a great incentive to attract an extra percentage of the market and, at the same time, to reduce costs.

The measures proposed in this bill are fair and non-discriminatory, and stand or fall as a related whole. They are consistent with this Government’s established domestic air transport policy. The new equipment will give the Australian travelling public a first-class air transport system. The rationalization of fleets will eliminate excess aircraft capacity and, at the same time, retain the competitive incentive which has contributed so greatly to the efficiency of the domestic air transport system. Furthermore, it should contribute greatly to stability in an industry which is receiving considerable financial support from the Government. This support is not confined to aircraft purchases by the airlines, but covers also the heavy annual costs involved in the maintenance and operation of airways facilities. We are naturally concerned, therefore, to see that this industry is placed on a sound economic basis as soon as possible. All our rationalization commitments have been directed to this end and to the maintenance of competition in Australian civil aviation. I commend the bill, which is vital to the re-equipment programmes of the domestic airlines.

Debate (on motion by Senator McKenna) adjourned.

page 758

LOAN (QANTAS EMPIRE AIRWAYS LIMITED) BILL 1958

Bill received from the House of Representatives.

Standing Orders suspended.

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

Second Reading

Senator PALTRIDGE:
Minister for Shipping and Transport and Minister for Civil Aviation · Western Australia · LP

– I move -

That the bill be now read a second time.

In this bill, Parliamentary approval is sought for a borrowing of 13,000,000 dollars by the Commonwealth from the Chase Manhattan Bank of New York and associated banks to finance the purchase of aircraft and equipment by Qantas Empire Airways Limited. Legislation is required to appropriate the Loan Fund to enable the proceeds of the loan to be paid over to Qantas, and to appropriate the Consolidated Revenue Fund to ensure that principal repayments and interest and other charges due on the loan will be met.

The loan agreement with the Chase Manhattan Bank was signed in New York on 17th June. This loan will furnish part of the dollar funds required by Qantas for the purchase of five Lockheed Electra turboprop aircraft and related spare parts and equipment. As payments are due on these aircraft, the Commonwealth will receive advances from the lenders and will re-lend these amounts to Qantas. The loan agreement requires the Commonwealth to enter into an agreement with Qantas, under which Qantas will assume full responsibility for the payment direct to the lenders of all interest charges and principal repayments on the loan. However, other charges associated with the loan will be met in the first instance by the Commonwealth and these will be reimbursed by Qantas.

As already explained in my secondreading speech on the Airlines Equipment Bill 1958, it was decided, after the loan from the Chase Manhattan Bank had been arranged, that Tasman Empire Airways Limited should purchase three Electras, one of which would be made available to Qantas on a charter basis from time to time. Qantas accordingly needed to operate only four Electras in its own name. As the loan agreement specifically covered the purchase of five aircraft, the full consent of the lenders was obtained for Qantas to transfer one of the Electras to TransAustralia Airlines, which has also decided to purchase two of these aircraft. A bill covering a borrowing on behalf of T.A.A. to finance the purchase of its second Electra will shortly be introduced into the Senate.

The sale of the fifth Electra to T.A.A. did not require an amendment of the loan agreement. However, the agreement has been amended, as indicated in the letter appearing ..as the Second Schedule to the bill, in order to permit advances to be made to the Commonwealth, and thence to Qantas, in units of 1 ,300,000 dollars instead of 1,000,000 dollars as originally agreed. This amendment was made to meet the mutual convenience of both the lending banks and Qantas.

As this was a borrowing in the name of the Commonwealth under the authority of the Commonwealth loan programme for 1957-58, the proposed terms and conditions were submitted to the Australian Loan Council before the loan agreement was signed, and they received its full concurrence.

The loan agreement is reproduced as the first schedule of the bill. Interest is payable at 4f per cent, per annum on three-fifths of the loan and at 4i per cent, per annum on the remainder. The loan is repayable in ten equal semi-annual instalments between 30th June, 1960, and 31st December, 1964. A commitment fee of £ per cent, per annum on the undrawn amount of the loan is payable from the date on which the Chase Manhattan Bank agreed in principle to make the loan, namely, 15th May, 1958. All of the funds are expected to be drawn in the second half of 1959.

In effect, this borrowing is very similar to the loan raised by the Commonwealth in November, 1956, on behalf of Qantas for its Boeing jet aircraft. The Commonwealth in each case merely acts as an intermediary between the lender and Qantas, incurring no net financial liability but giving Qantas the benefit of its high credit standing overseas. I commend the bill to honorable senators.

Debate (on motion by Senator McKenna) adjourned.

page 759

LOAN (AUSTRALIAN NATIONAL AIRLINES COMMISSION) BILL 1958

Bill received from House of Representatives.

Standing Orders suspended.

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

Second Reading

Senator PALTRIDGE:
Minister for Shipping and Transport and Minister for Civil Aviation · Western Australia · LP

– I move -

That (he bill be now read a second time.

This bill is very similar to the Loan (Qantas Empire Airways Limited) Bill, on which I have just delivered my second-reading speech. It seeks the approval of Parliament for a borrowing of 3,000,000 dollars by the Commonwealth from a group of United States banks to finance the purchase of a Lockheed Electra aircraft and related spare parts and equipment for the Australian National Airlines Commission. The aircraft will be used by Trans-Australia Airlines on its internal services in Australia.

The legislation appropriates the Loan Fund to permit the proceeds of the loan to be paid over to the Australian National Airlines Commission, and it makes appropriations from the Consolidated Revenue Fund to ensure that principal repayments and interest and other charges on the loan will be met on the due dates. The loan agreement was signed in New York on 10th September. The lenders are the four United States banks whose names appear in the schedule to the bill.

As was explained earlier, when the Airlines Equipment Bill was introduced, T.A.A. intends to operate two Lockheed Electras, one of which will be acquired from Qantas. The other will be mainly financed under this loan. The current borrowing of 3,000,000 dollars is actually part of a loan of 12,000,000 dollars arranged with the four banks named in the loan agreement. The other 9,000,000 dollars will go to Tasman Empire Airways Limited, which is jointly owned by the Commonwealth and New Zealand Governments, to assist with the financing of its own three Electras. The same interest rate is payable under the two separate loan agreements, and the other terms and conditions are broadly similar after making allowance for the fact that T.E.A.L. is borrowing in its own name and requires the funds about six months later than T.A.A.

Under the loan agreement covering the financing of the T.A.A. Electra, the Commonwealth will receive advances from the lenders as payments fall due on the aircraft and will re-lend these advances to the Australian National Airlines Commission. An agreement will be entered into between the Commonwealth and the commission under which the commission will assume full responsibility for reimbursing the Commonwealth for payments of principal and interest and all other costs of the borrowing. This borrowing is being made in the name of the Commonwealth under the authority of the Commonwealth loan programme for 1958- 59 and, accordingly, the proposed terms and conditions were approved by the Australian Loan Council before the loan agreement was signed.

The loan agreement is reproduced as the first schedule to the bill. It is similar in most respects to the loan agreement for the Qantas borrowing. Interest is payable at 4i per cent, per annum, which is slightly higher than the rate we obtained for Qantas in the agreement signed three months earlier. We were very fortunate to negotiate a rate as low as 4i per cent, for the T.A.A. borrowing as the yields on United States Government securities had risen appreciably in the meantime.

The loan is repayable in equal semiannual instalments from 31st December, 1959 to 30th June, 1964. A commitment fee of one half per cent, per annum on the undrawn amount of the loan is payable from the date on which the lending banks agreed in principle to make the loan, namely 25th July, 1958. All of the funds are expected to be drawn in the first half of 1959.

As with the borrowings on behalf of Qantas, the Commonwealth is merely acting as an intermediary and there will be no net call on Commonwealth cash resources because of this loan. I commend the bill to honorable senators.

Debate (on motion by Senator McKenna) adjourned.

page 760

MARRIAGE (OVERSEAS) BILL 1958

Bill returned from the House of Representatives without amendment.

page 760

AIRLINES EQUIPMENT BILL 1958

Second Reading

Debate resumed (vide page 758).

Senator McKENNA:
Leader of the Opposition · Tasmania

– The bill now before the Senate has been floated in conjunction with two other financial measures authorizing the borrowing of dollars, but they all form part of the one pattern. I hope that the Minister for Civil Aviation (Senator Paltridge) and the Senate will agree to the three bills being taken together, so that one may refer freely to all of them.

I acknowledge that each of the measures would have to be put to the vote separately.

Senator Paltridge:

– That course would be quite acceptable to me.

The DEPUTY PRESIDENT (Hon. A. D. Reid). - There being no objection, that course will be followed.

Senator McKENNA:

– The three bills are concerned with a vastly important matter - the modernization of the airlines of this country. Very largely, the present fleets will be replaced, the ordinary propellor aeroplane giving way to the turbo-prop jet and machines of a much more modern type. Two questions arise in a matter such as this. First, what types of aircraft have been chosen? Secondly, what are the costs, and the difficulties of finding the appropriate currency with which to make the purchases?

I begin by dealing with the first matter. Looking at its history, I find that in March last there was an intimation from TransAustralia Airlines that it wished to buy two jet Caravelles. These aeroplanes, which are pure jets, would have been quite new to the airlines of this country and would undoubtedly have been a distinct advance on anything operating hitherto. Simultaneously, Ansett-A.N.A. indicated that it wanted four Lockheed Electras. This American aircraft is of the turbo-prop type and is not a pure jet. It is, however, a very modern machine.

The Minister, and presumably Cabinet, considered these requests by the two major operators on the interstate routes and on 27th March the Minister indicated that Cabinet had refused the airlines permission to acquire machines of the type that they had in mind. The principle laid down as the basis for that refusal was that it was economic for both lines to build upon British Viscounts in the new 800 series. It was argued, and I quote the Minister exactly - that the traffic background to-day shows a decline in the rate of growth and the Electra and the Caravelle cannot be operated as economically on the shorter route stages up to SOO miles, which carry 75 per cent, cf the total traffic.

It is quite obvious, from the fact that T.A.A. asked for two Caravelles only, that that airline did not intend to use them on short trips. The economics of the matter surely pointed to the fact that T.A.A. intended to use them on the long runs, in particular to Perth. It is quite obvious that T.A.A. would have been a restricted user of the Caravelle.

I say at once that it must have been very disappointing to T.A.A. to be prevented from taking ‘ this highly progres»sive step - in respect of but two of these machines, which were purchasable in a soft currency country, and whose purchase presented none of the difficulties associated with the purchase of American machines. The fact that the Government refused T.A.A. the right to acquire ultra-modern machines of that type, and has compelled the two main airlines in the interstate field to standardize on a different type - the Electra, a turbo-prop aircraft - means that future airline development in this country will be based on the turbo-prop aeroplane and that the day of the pure jet is now further away than ever. In other words, the Government’s action has been a blot upon airline progress.

T.A.A. has always shown enterprise and excellent judgment in selecting aircraft for particular purposes. One of the many reasons for its great success has been the fact that it has been free to choose its aircraft. The acquisition of the Convair was an outstanding move. T.A.A. then progressed to Viscounts, and has always remained in the forefront of progress. The Government did not act in an enlightened fashion when it prevented T.A.A. from taking the progressive step that it had in mind.

The matter was the subject of discussion over some months between the Minister and the operators and, to the amazement of many, an announcement was made on 22nd May that the Government had settled on Electras as the type that the airlines should use. The Minister had indicated that they would be suitable only in about 25 per cent, of the interstate field, or the internal air services of Australia, and it did come as a complete surprise to find that Electras were chosen for not only the interstate lines but also for Qantas on its international routes, for T.E.A.L. on the flight over to New Zealand and back, for AnsettA.N.A. and for T.A.A. It came as a complete surprise to find that, in the light of a refusal on 27th March to allow AnsettA.N.A. to purchase Electras, the Government suddenly - within two months - determined on Electras for all these operators, both overseas and interstate.

The Government decided that of the Lockheed Electras Qantas would get four, Ansett-A.N.A. two, and T.A.A. two. It also decided that there would be six Fokker Friendship jet machines to replace the DC3’s, but those Fokker Friendships were to have a 63 per cent. British content, including British engines. This would bring T.A.A.’s order for Fokker Friendships to twelve, instead of six. The Government decided also that T.E.A.L. was to get three Electras and that four Viscounts were to be purchased for the use of T.A.A. and Ansett-A.N.A. It is very good to see some degree of standardization in this country. I concede at once the advantage of having Qantas, T.A.A., Ansett-A.N.A. and T.E.A.L. using Electras. I understand that the aircraft are powered with Allison engines, which will be of the same type that propels the Hercules transports being purchased for the Army. I concede at once that that does make for ease of maintenance, repair, spare parts and so on. But the whole question is whether it is the right machine to select for the particular purposes that are required in Australia. On long flights, unquestionably it is; but, on the Australian scene, the jet might well have been the more progressive venture.

I should say that we have now reached the stage where Australia is committed for many years ahead, as a result of this decision, to the turbo-prop type of aeroplane and that the day of the pure jet in our internal air services has been very long postponed. The effects of this will not be felt immediately because the Electra is a very fine machine, but I fear that, with the fast development that takes place in the field of aviation, before long the Electra itself will be outmoded and Australia will be dragging behind instead of being in the forefront of activity in the air.

I note that in the report of T.A.A. which was tabled in the Parliament only the other day, the manager of the organization was very careful, despite what the Minister says, not to give specific approval to the use of Electra aircraft. I am now looking at page 4 of that report, on which the manager says -

Following the Commonwealth Government’s decision to approve the. purchase of Lockheed Electra aircraft by Australian overseas and domestic operators, the commission is negotiating the purchase of two of these aircraft for delivery in mid-1959.

He expresses no joy about the decision, and it is clear, from that statement, that T.A.A. was under the compulsion of the Government’s decision.

Senator Kendall:

– lt is a government line.

Senator McKENNA:

– Of course, it is a government line, but it is also an airline that enjoyed a great degree of autonomy until this Government came into power and began its rationalization process back in 1952, a process which it has continued right up to the present time! It may be derogatory to the dignity and enthusiasm of the executives of T.A.A. to find that, after they had combed the world - and they indicated that they had - to select the best type of aircraft, their choice is spurned by a government. In this bill, as we go through it, we find that the Minister is the man who determines the minimum payload and all kinds of things in relation to aircraft operating in Australia. But I am certain that our Minister would not claim to be an expert in these matters, and therefore he will have to rely upon the advice of officers. In short, we shall get to the position where some officer or official of the Department of Civil Aviation will be the real czar in relation to interstate activity in Australian airlines.

Senator Wright:

– Does not that usually follow as a result of government control of business?

Senator McKENNA:

– I put it to the honorable senator that this is not a public service activity in the ordinary sense. The Australian National Airlines Commission has chosen its own staff, and it has been managed from the beginning by people who are not integrated into the public service.

Senator Wright:

– I am not disagreeing with your argument; I just ask whether you agree with my conclusion.

Senator McKENNA:

– No. I do not say that at all. It depends entirely upon how the organization is run. I merely draw the distinction between an instrumentality like T.A.A. and an ordinary government department.

Senator Courtice:

– The Government is telling the commission what to do.

Senator McKENNA:

– That is true, and it is taking out of the commission’s hands an exceedingly vital matter at a time when it has an opportunity to .compete with Ansett-A.N.A., and to forge ahead of that airline, because of the excellence of its machines. At that very point, when its , enthusiasm is at its height, the commission is diverted.

Senator Kendall:

– Do you not think it is more annoying to a private company to be told by a government what it is to buy?

Senator Henty:

– Or not to be given dollars to buy anything!

Senator McKENNA:

– That is another point I take up with the Government at once. At this time, when Australia is in great difficulty about dollars, indeed in greater difficulty than ever before, it does seem a pity that the Government’s mind did not address itself not only to the wishes of T.A.A. in the choice of type of machine but also to the availability of dollars. Why bypass British and Continental machines which would have been available without the need to borrow dollars abroad? There will now be all the added costs of replacement and all the balance of payments difficulties with the dollar area?

Senator Mattner:

– Did I understand you to say that the Government is giving instructions to the airlines commission as to what it should do?

Senator McKENNA:

– The Government has made the decision for the commission as to the type of aeroplanes it should buy. The Government has settled down in favour of the types of machines preferred by Ansett-A.N.A. and has completely disregarded T.A.A. ‘s wishes to go into the air with the French Caravelle, a pure jet machine.

Senator Mattner:

– I am only asking whether you said the Government gave instructions as to what should be done. As long as I understand that you said the Government gave instructions for certain things to be done, that is all I wish to clear up.

Senator McKENNA:

– The honorable senator has only to advert to what I read from page 4 of the report of T.A.A., where it says -

Following the Commonwealth Government’s decision to approve the purchase of Lockheed Electra aircraft . . .

If he reads that, he will appreciate that the decision was made by the Government, not by T.A.A., however much it might have been pressurized by the Government into the matter. It is completely clear that this was a government decision.

I thought, in relation to the whole of this matter, that the most laughable part of the Minister’s second-reading speech - it would be laughable if the situation were not somewhat tragic - was the indication that he was concerned about promoting competition between the two major airlines. I understand the policy of the Government, as announced by the Minister in 1952 and 1957, and again at this time, to be that there should be two, and not more than two, operators on the interstate air routes.

Senator Henty:

– That policy allows one more operator than is provided for by the policy of your party. The Labour party would have had only the Government airline.

Senator McKENNA:

– That is perfectly true. If the Labour party had had its way in 1947, only one airline would be operating to-day. Then we should not have had this enormously heavy superstructure. How many honorable senators understand the formulae written into the bill to determine paying capacity? The bill contains an extraordinary set of figures and hieroglyphics that any layman would have the utmost difficulty in understanding. The Government has established an intricate organization of rationalizers, arbitrators and conferences while, if there were only one airline operating on the interstate air routes, that organization would not be necessary.

Senator Kendall:

– Before the Labour party interfered, there was only one airline - doing a jolly good job, too!

Senator McKENNA:

– Of course it did a very good job. The old A.N.A. always did a very good job. Further, that company improved enormously when T.A.A. entered the field. The long waits were eliminated; quick transport to and from airports was provided, and generally far better facilities were available. The competition provided by T.A.A. had a very salutary effect, and the people of Australia reaped the benefit.

The Minister now claims that he is promoting competition. Every move that this Government has made since 1952 has been directed towards rationalizing or eliminating it until the two operators are moving almost as one. It is most extraordinary that a government that continues to sponsor its own airline should say to that airline, as it did in 1952, “Hand over to A.N.A. half the freight and Government mails you are carrying. We intend to make Government business available to both airlines on an equal footing. We have guaranteed a loan of £4,000,000 to your competitor.” The whole situation is Gilbertian.

Senator Henty:

– The arrangement encouraged competition and resulted in good service. The honorable senator has just admitted that.

Senator McKENNA:

– It has produced a Gilbertian situation. I announce our opposition to this bill, because it, like the 1952 and 1957 measures, is designed to build up the competitor of T.A.A. to the detriment and disadvantage of that airline. The ordinary air travellers of Australia will also suffer a disadvantage if this bill is passed. I propose to come to that point in a moment.

Despite the help that was given to A.N.A. in 1952 - a share in the carriage of passengers, mails and freights - the company collapsed. It was not able to meet its commitments; in fact, in June last year it was unable to meet commitments amounting to £500,000. This Government had to go to the company’s aid in 1957, re-arrange its loans, obtain extensions of time to meet commitments, and re-guarantee the company. To keep the airline up to date, private enterprise is attempting to raise some £5,000,000, £6,000,000 or £7,000,000 on the open market and the Government has to guarantee it. The company is so weak financially that it cannot stand on its own feet. , The series of bills to which I have referred covers guarantees of millions of pounds to enable the private airline to keep up to date and compete with T.A.A. If a company has prospects of successful continuance, I should think it would have no difficulty in raising £5,000,000, £6,000,000 or £7,000,000 in Australia. But this company must have Government support - I repeat, Government support - by way of guarantee. As I stated earlier, it is extraordinary that a competitor of the Government airline should be so nurtured by the Government. Despite the assistance that has been given in the past - the right to draw up to £4,000,000 on Government guarantee - it still has to be helped. It cannot look to ordinary financial fields for assistance.

This discrimination against T.A.A. is apparent in all legislation dealing with airline companies. When the 1957 measure was before us I said that the new tax of 6£d. a gallon on aviation kerosene would fall almost entirely upon T.A.A., and that it was perfectly certain that before very long charges would have to be increased. My words were proved completely true. Only a few months later a 10 per cent, increase was made in freight charges, an overall 5 per cent, increase in fares on interstate air services; a 3 per cent, increase in fares on services into and out of Darwin, and an increase of 5 per cent, in fares on secondary routes. That information is recorded on pages three and four of the report of the Australian National Airlines Commission.

I should like to refer briefly to my remarks on 20th November last which appear at page 1390 of “Hansard”. I said -

I wish lo refer now to something which concerns every one in Australia, lt is quite obvious that the imposition of this additional burden of £350,000 on T.A.A. in this year of grace-

I referred then to the tax on aviation kerosene - will result in it either accepting a debit, or deciding to raise fares. Therefore, not only T.A.A. but all air travellers and users of air freight are to suffer from the Government’s blundering. Already T.A.A.’s competitor, the private airline, is flying the kite. If the Minister will refer to the press of 14th November, he will see that Ansett-A.N.A. has predicted a fare increase of 5 per cent, on its part very soon. Therefore it is obvious that TA.A., as a result of what the Government has done quite recently, must either suffer a financial loss this year, and be accused of inefficiency - thus allowing the Government to get ready for the kill, as it has done with so many other successful organizations - or set about raising fares. I suggest to the Government that what it is doing is to the detriment of every one interested in the interstate airlines of this country.

That is exactly what happened - in a very short time too! Honorable senators will be interested to learn the amounts taken out of T.A.A. by the Government during the past year. Some of the figures I shall quote are included on page 10 of the report. For the year ended 30th June, 1958, the following amounts were paid to Consolidated

Revenue: - Air route charges, £152,021; aviation fuel tax - most of which would be the tax of 6£d. a gallon on aviation kerosene, £469,219; pay-roll tax, £106,752; dividends, £218,500; income tax on the airline’s ordinary operations, £178,238; and tax on capital profit arising from the sale of aircraft, £17,626. In short, T.A.A. with a capital of £4,000,000, yielded to the Government in revenue and dividends under the various heads that I have mentioned the amount of £1,142,356.

Senator O’Byrne:

– A mighty airline!

Senator McKENNA:

– It is a mighty airline. It has shown a marvellously good result.

Senator Henty:

– What does its competitor pay?

Senator McKENNA:

– That is the very thing the nation is entitled to know, but has never been told. Ansett-A.N.A. is a proprietary limited company, which publishes no accounts, although I have no doubt that the Minister has a right of access to its accounts. I think the nation has a right to know just what is its position. What does it put in? As it is being subsidized or financially supported - I used the wrong word when I said “ subsidized “ - to this vast extent, why should not its affairs be open to inspection? How do I and how does Senator Henty or anybody else in this chamber know whether the company needs supporting, whether it is making a profit, and whether it is worth bolstering up? Here is an airline supported by this Government to the extent of a guarantee covering many millions of pounds. It is being nurtured, in that the Government is making sure that it will get a half-share of mails and freights. T.A.A., on the other hand, is being limited in its carrying capacity, so that Ansett-A.N.A. will have an equal opportunity. The Minister asks me, “What is the position of T.A.A.’s competitor? “, and I say to him that I do not know. He may know, but I have no idea. I say that I should know, that everybody in this Parliament and everybody in the nation should know.

Senator Kendall:

– Why should you know the position of Ansett-A.N.A. rather than the position of any other company?

Senator McKENNA:

– If it were free from government help and sponsorship, I would have no right to know, but as it is completely dependent upon government assistance for its existence and its ability to keep in the air, we are entitled to know its financial position so that we can decide whether it is worth supporting. In the absence of such information, we can only have doubts on that matter.

It amused me mightily to hear the Minister say in his second-reading speech that what is being done under this bill will intensify rather than reduce competition. What is being done under the bill, from a rationalization viewpoint, is to say that one airline must have no more capacity than is strictly necessary for it to carry out operations on its competitive routes and its non-competitive routes and to provide a margin for standby replacements and that type of thing. Anybody who has read the bill will know that it requires that both airlines shall have exactly the same capacity. What will happen if a substantial majority of air travellers wish to travel by T.A.A.? They will have to spill over to another line, one which they have not selected. The Minister said in his speech that the minimum capacity will be fixed at 70 per cent., but there will be 30 per cent, of capacity in which there is elbow room. That is a very small margin. Suppose that one airline - as I believe it does - commands a greater degree of support by travellers than the other airline. How soon will the 30 per cent, of capacity be filled? What will happen then? Those who wish to travel by the national airline will be told, “You will have to find room with the other one “. If people wish to travel by air and have a preference for one airline, why should they not be completely free to give effect to that preference when they want to do so?

This goes very much further than merely the standardization of types of aircraft and types of engine, and giving an even break to each of two competitors in the field. It affects freedom of choice, about which Government members continually prate. It affects the freedom of choice of air travellers, prospective or actual. They should be able to please themselves. I would be glad to hear some member of the Government stand up and try to justify this denial to a substantial majority of the people of Australia of the right to exercise a clear unfettered choice.

I do not think I am unfair to AnsettA.N.A. - I cast no reflection on that company - when I say that I think that throughout the world air travellers generally feel a little more safe and comfortable in aircraft operated by a government airline, whose primary objective is not to make profits.

Senator Wright:

– Does that apply to motor vehicles too?

Senator McKENNA:

– I cannot say that. I do not know of any government that is engaged in that type of manufacture. I would say that what the Government has done in relation to this measure is completely to negate the possibility of competition between the two airlines. It has ruled competition out. One finds it most amusing to read the last clause of the bill, which states -

The Minister shall not, in the exercise of his powers under this Parliament, unfairly discriminate in favour of the Commission or the Company as against the other.

There is complete discrimination against the national airline. It is not allowed to choose the type of aircraft it wants; its carrying capacity is limited, and it can be directed by the Minister to dispose of surplus aircraft. In oher words, the Minister becomes the Pooh Bah of the airlines of Australia. He tells them what types of machines they can buy, how they are to allocate the machines between themselves, and what they must do with surplus machines.

Senator Paltridge:

– That applies to the competitor too.

Senator McKENNA:

– The Minister cannot have it both ways. If he wants competition, he must let both airlines carry on and allow the better one to survive or take a major part of the business. The point I am making at the moment is that he cannot claim that what he is doing now is an incentive to competition.

Senator Scott:

– You were not going to have any competition at all.

Senator McKENNA:

– It was provided by statute that when an adequate service was established between two points, then the Government line should have that service to itself, paying compensation. An adequate service was clearly defined; the matter was not left to the discretion of a Minister or other individual. The very best thing that could have happened to this country would have been to have done what the Labour Government wanted to do. However, it was proved not to be possible, and, of course, it has not been attempted since. It cannot be attempted now without an alteration of the Constitution.

Senator Scott:

– And a change of Government.

Senator McKENNA:

– No government can nationalize airlines in this country or - I add for the honorable senator’s information - anything else.

I think the Minister should have indicated to the Senate from where Ansett-A.N.A. is to get the necessary dollars. We have been told in detail how Qantas and T.A.A. will get them. From where is Ansett-A.N.A. going to get all the dollars that will be required to purchase its Electras? Will the Government facilitate that purchase, or will Ansett-A.N.A. have to act on its own in that matter? If we are to be given every detail of the finances of T.A.A., why does not the Minister tell the Senate something about the basis of finance of Ansett-A.N.A.? What loans are to be guaranteed? From whom are the loans to be raised? Are they overseas loans or local loans? These are questions which, if the Minister is to put the position fairly before the Senate, must undoubtedly be answered.

I invite him to say what has happened in relation to the Butler proposal. If I remembered correctly, Mr. Butler has announced that he intends to enter the interstate airline business. The point I make is that, if Butler decides to enter that service fully equipped, the Minister will not be able to keep him out. Then what will happen to the Minister’s principle of two operators and no more in the domestic airline field? Would Butler be kept out of the air by being refused a licence to import the necessary machines? Would he be kept out of the air by being refused the foreign currency that he might require? I think the Minister should indicate to the Senate quite frankly what prospects he has of holding down the number of operators to two unless, when a third one emerges, he takes such drastic steps as to refuse import licences or the provision of foreign currency. I repeat that I think we should be told about that matter, because Butler has announced that he proposes to re-enter the field. If that happens, the whole basis upon which the rationalization agreement between AnsettA.N.A. and T.A.A. is effected will fall flat to the ground. The Minister will have to start all over again.

Senator Wright:

– Do I understand the honorable senator to suggest that it would be iniquitous discrimination?

Senator McKENNA:

– I do suggest that, if it is achieved on the side by denying dollars and import licences.

Senator Wright:

– But you would justify it if it were achieved by direct socialization.

Senator McKENNA:

– I have dealt with that particular topic, and I have indicated that socialization is a physical and legal impossibility. Having said that, I do not propose to pursue the matter any further with the honorable senator or anybody else.

Senator Wright:

– Do you suggest there is any legal impossibility about refusing an import licence for anything that Butler asks for?

Senator McKENNA:

– I did not suggest there was a legal difficulty, but I should say it would be a complete and direct defiance of the provisions of section 92 of the Constitution, for which I thought the honorable senator had such warm regard.

Senator Wright:

– Hear, hear!

Senator McKENNA:

– It would be an indirect way of getting around the protection afforded by section 92. It makes one wonder whether we are getting around to the principle enunciated here by Senator Spooner not very long ago when he indicated that the Government’s outlook in this very matter was that, if the Government was in a field of business, it should vacate that field when private enterprise was ready to take over. Will some honorable senator opposite indicate where T.A.A. stands in that regard? Is all this bolstering of its competitor leading to the day when that competitor will have been strengthened and when the position will have been reached where, as Senator Spooner said, speaking officially about the Government’s outlook on socialization, the Government should get out of the field, private enterprise being ready to do the job? I should like some one on the other side of the chamber to say emphatically and clearly whether that is affirmed and whether all that is being done in the building up of T.A.A.’s competitor is being directed coldly, steadily, and brutally to that end.

I posed this question in November, 1957: If the Government is concerned about T.A.A., why is that organization not allowed to operate to New Guinea? Why is it not allowed to operate in the intra-state field, into which State governments are prepared to let it go? Look at the marvellous job it has done in Queensland in developing the outback, and right down into South Australia and the north of New South Wales.

Senator Kendall:

– A.N.A. did that before T.A.A. was ever thought of.

Senator McKENNA:

– The areas to which I have referred were pioneered by T.A.A. That is developmental work which only a government airline will undertake, because it cannot pay for years. It is national work.

Senator Kendall:

– A.N.A. is still covering the whole of the north. T.A.A. does not operate north of Townsville.

Senator McKENNA:

– This developmental work is vastly important.

Senator Kendall:

– You are talking a lot of rubbish.

Senator McKENNA:

– I think the honorable senator- should read the report of the-

Senator Kendall:

– I do not care about the report. I travel in the ‘planes.

Senator McKENNA:

– The report of the Australian National Airlines Commission indicates just what T.A.A. has done. The report indicates very plainly that these developmental routes are being operated not at a profit.

Senator Kendall:

– 1 agree with that.

Senator McKENNA:

– Does the honorable senator contend that Ansett-A.N.A. is operating routes in the outback not at a profit?

Senator Kendall:

– Of course, it is.

Senator McKENNA:

– Well, good luck to it, if that is the case.

Senator Paltridge:

– How wrong can you be!

Senator McKENNA:

– I am merely asking for information. I shall be very glad to hear some details about it.

Senator Wright:

– And A.N.A. operated these routes on a pioneer basis at first, not at a profit, until Labour monopolized them.

Senator McKENNA:

– The honorable senator goes too far when he says we monopolized them.

Senator Wright:

– You tried to. The High Court thwarted you.

Senator McKENNA:

– The Government’s attitude towards airlines operations is amusing. In regard to our overseas airline, Qantas, the Government is the complete socialist. It owns every share in that organization, which is one of the greatest airlines in the world. In the other overseas airline - T.E.A.L. - the Government is on half-shares with another government - again the complete socialist! It is half socialist in regard to Australian interstate activities. In fact, it is three-quarters of the way to being socialist because it is perfectly certain that, without government support, Ansett-A.N.A. would fall out of the air race.

Senator Scott:

– But it is not five-fifths socialist.

Senator McKENNA:

– I should like to hear some of the philosophers on the other side of the chamber explain the Government’s socialistic outlook on overseas airlines and its abhorrence of socialization in regard to the internal airlines. Does distance lend enchantment to the view?

I conclude by intimating that we will oppose the bill, for the reason that it is only an extension of the 1952 agreement into which, as the Minister has frankly admitted, T.A.A. was coerced. Last November, the Minister himself put it delightfully when he said that T.A.A., though effectively bound, was not a voluntary party to the agreement. The whole world knows that in 1952 T.A.A. was opposed to what was then done. All that was done in 1957, and all that is to be done pursuant to the passing of this measure, is built upon the iniquitous step that was taken in 1952.

Senator Paltridge:

– The Australian National Airlines Commission signed the 1957 agreement, thereby binding itself to the 1952 agreement.

Senator McKENNA:

– But the 1952 agreement was not particularly specified. The honorable senator must recall that T.A.A. was not even a party to the 1952 agreement.

Senator Paltridge:

– I am saying that it was bound by the signing of the 1957 agreement.

Senator McKENNA:

– According to my recollection, the 1957 agreement did not specifically bind T.A.A. to the 1952 agreement. The 1952 agreement was adverted to, but T.A.A. has never accepted that agreement.

Senator Paltridge:

– The 1957 agreement bound it to the 1952 agreement.

Senator McKENNA:

– The 1957 agreement was directed almost primarily to bolstering the loan defaults of A.N.A. and to binding the Ansett series of companies to the 1952 agreement. I indicate that we oppose the bill immediately under consideration for that and the other reasons I have given.

Senator MARRIOTT:
TASMANIA · LP

, - Mr. Acting Deputy President, we have been unfortunate enough to have had to spend about 45 minutes listening to the most rambling speech that we have ever had to listen to from one of the most able debaters in this chamber, the Leader of the Opposition (Senator McKenna). The reason for the rambling nature of his speech and the ring of insincerity in the argument he advanced against this bill may lie in the fact that we are at the end of this sessional period or in the fact that his mind is on other matters related to 22nd November next.

It is apparent that because this Government continues the policy, expressed in 1949 and carried out consistently ever since, of helping to maintain in Australia two of the world’s finest domestic airlines, the Labour party sees fit to criticize it. The members of that party make veiled references and do what they can, in their speeches, to make the general public of Australia feel that there is something sinister about the privately operated airline companies. It would be well for them to appreciate that the people of Australia, who are rapidly becoming more and more air-minded, are very grateful for the privilege of being able to travel by one or other of those major air services.

Senator McKenna debated the question of whether or not there should be one or two major airlines, whether or not there should be fair competition, and so on, but we know perfectly well that if the party of which he is a member came to office again, one of its first moves would be to try to close the privately operated company, but if it did so, the people of Australia would give it no thanks. In addition to the great value to our own travelling public and to visitors of two such airlines as Trans Australia Airlines and Ansett-A.N.A., efficiently operated and with a modern fleet of aircraft, they could have a great defence value. I am pleased to see that the Government is taking every step that it can to ensure that our domestic airlines are run on an economic basis, with modern aircraft and under conditions that provide for fair and decent competition.

We in Tasmania, of course, recall with pride that it was from that State that the pioneers of the airline companies came. The Holyman brothers did a wonderful job in pioneering the air services that have developed to the stage at which they are to-day. Then, in 1946, the Labour government of the day brought about the formation of T.A.A. It did that, not to develop Australian airline services, but with the direct intention of driving the privatelyoperated companies out of the air. At that stage, these so-called lovers of freedom in the Labour party would not permit those who travelled on Government vouchers to choose the airline with which they wished to travel. These lovers of freedom said, “ No. You will travel on T.A.A., whether you like it or not.” I think that it is greatly to the credit of this Government, in this so-called free country, that straight away, on coming to office, it said to the public servants and others who travelled on government vouchers, including members of the armed services, “When you travel on a government voucher you may choose the airline that you desire to travel with. You may select the one with which you feel you will be happier.” That policy has been reiterated time and again, and the public servants and members of the defence forces are very pleased that they have that freedom of choice. They will never thank any future socialist government that attempts to take that right away from them.

This legislation, in effect, says to the people of Australia, “You are going to have some of the most modern aircraft “. Senator McKenna was somewhat critical of the Government because, he said, it refused to allow T.A.A. to buy the French Caravelle jets. The honorable senator may know more about this matter than I do, but 1 wonder whether our airport authorities would welcome the Caravelles, because I understand that one of the great problems associated with the jet aircraft, in its present stage of development, is the noise that it creates. I believe that the Government is wise in offering to the airlines the chance to have fleets of the consistently high standard that they will have when the Electras, the new Viscounts and the Friendships- come into operation.

The criticism by the Labour party of the financial clauses of the legislation before us is weak, because the purchase of new aircraft and the provision of spares and equipment for them, due to the great expense involved, is beyond the present financial ability of the airlines. This Government has followed the example of overseas governments which have exercised the right, under legislation, to provide backing for private airline companies in order to keep their equipment modern. The people of Australia may be assured that not one penny piece of the public money will be spent under this legislation to help the private-operated airline companies. We are merely guaranteeing the loans that they will have to find themselves for the purchase of the aircraft with which they are being given authority to equip themselves. I trust that the Labour party will remember that fact and will not, either here or during the forthcoming general election campaign, accuse the Government of paying money to a privately owned airline to purchase new aircraft.

Those of us who have studied the legislation and listened to the speech of the Minister for Civil Aviation (Senator Paltridge) will appreciate that the Government has inserted very wise and obviously carefully-thought-out financial conditions. The private operators will have to adhere to those conditions, and the Government’s guarantee is thereby rendered safer than it might be otherwise. This legislation is really the third chapter of the Government’s policy in respect of the airlines. I congratulate it for maintaining its policy in this respect. I trust that the people of Australia will realize that it is better for them to have two airlines running, with a certain degree of rationalization, and with solid support, than to have one airline run solely by the government-operated commission.

Senator O’BYRNE:
Tasmania

.- The bill before the Senate has been presented by the Minister for Civil Aviation (Senator Paltridge) as one that covers the future activities of the major airlines operating within Australia. It has been decided that we shall discuss, at the same time, the three bills dealing with the loan for AnsettA.N.A., the purchase of aircraft by TransAustralia Airlines, and the financial arrangements for Qantas Empire Airways Limited and Tasman Empire Airways Limited. It is rather significant, Mr. President, that the Minister for Civil Aviation, who has shown a degree of energy and ability in handling his portfolio that is unusual in the present administration, should find himself playing second fiddle in the presentation of this legislation. Senator McKenna has recalled that, earlier in the year, the decision to buy Caravelles was altered. Ever since that time the negotiations in this matter seem to have been handled by the Treasury. This bill was presented in another place by the Prime Minister (Mr. Menzies) in his capacity as acting Treasurer. This shows that it is not just an ordinary bill to provide for the domestic requirements of the airlines, but that it has a very deep significance. I am certain that it is not understood by supporters of the Government nor by the people of Australia who, after all are the ones vitally affected. The people should know the level on which this arrangement has been made.

At this vital period in the history of Australia’s airlines, the bill represents a departure from the traditional practice of Australian trade. Australia has acknowledged down the years the high standard of British science and engineering, the magnificent standards set by the Rolls Royce organization, the high levels reached in both peace-time and in war-time by the British aircraft manufacturers, and the outstanding performance by the Vickers organization in presenting to the world what is, I should say, one of the finest commercial aircraft, the Vickers Viscount. It is a pity that this Government, by design, is altering the pattern of Australia’s traditional trade with Great Britain and is turning to a new source of supply at a time when we are changing from one era of flying to another, from the internal combustion engine and the piston engine to the turbo-prop and the jet aircraft. When the history of aviation is written, it is most likely that the present will be regarded as a vital period. It is a period in which we should consider very closely whether we should change from our traditional supplier, the British aircraft industry, to the American industry. Mr. President, at this juncture, I ask for leave to continue my remarks.

Leave granted; debate adjourned.

page 770

CONSTITUTION REVIEW COMMITTEE

Report

Senator O’SULLIVAN:
General · QueenslandVice President of the Executive Council and Attorney · LP

. -I bring up a report from the Joint Committee on Constitutional Review, and move -

That the report be printed.

I should like, in the first instance, to pay a very warm trbiute to the talented and devoted staff who assisted the committee in its work. All were excellent, but I mention especially the really brilliant work of the legal secretary, Mr. J. E. Richardson.

I feel that he was to this committee of no less value and assistance than was the late Sir Robert Garran to the federal conventions from which emerged the Australian Constitution. The report will endure as a very fine record of his industry and ability.

Secondly, I wish to thank my colleagues for the cordial and co-operative attitude that they displayed at all times, even when the discussions were of a vital and very contentious nature.

Lastly, I say that the document now presented to the Parliament is not claimed to reach anything like perfection. It is essentially a compromise designed to reach the attainable. The degree of unanimity reached emphasizes this. The committee trusts that its report will receive full consideration not only by the next Parliament but also by the public bodies and the people of Australia.

Senator McKENNA:
Leader of the Opposition · Tasmania

– I have very much pleasure in seconding the motion that has been submitted by the Leader of the Government (Senator O’Sullivan). I am delighted with the tributes he has paid to the staff of the committee. In particular, I commend the tribute that he paid to our legal secretary, Mr. Richardson. I thank the honorable senator as chairman, for the very many courtesies that he extended during the long period the committee functioned and on the many days on which it sat. I join with him in expressing thanks to our other colleagues on the committee. Apart from the joy of work one of the most pleasurable events was the opportunity it presented for association with those who constituted the committee. That is a phase of activity in the Federal Parliament that I shall always remember with a very warm glow of pleasure. In conclusion, I join with the Minister in trusting that the report will receive the full consideration of the Government, of the Parliament and of the people of Australia.

Question resolved in the affirmative.

page 770

TARIFF BOARD

Reports on Items.

Senator HENTY:
LP

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

Cotton piece goods (sheeting, &c).

Electric filament lamps.

Thioglycollic acid and its salts.

Vegetables of the type classifiable under Tariff Item 102.

page 770

PRINTING COMMITTEE

Senator BUTTFIELD:
South Australia

– I present the third report of the Printing Committee.

I should like to say that the Printing Committee decided early in the year to make an investigation of the various sizes used for the printing of parliamentary papers and official reports. Your committee sought the views of Mr. A. J. Arthur, Commonwealth Government Printer, Mr. W. G. Murray, Assistant Government Printer, Mr. C. L. Hewitt, First Assistant Secretary, Department of the Treasury, Mr. F. A. Bland, M.P., chairman of the Public Accounts Committee, and Mr. R. C. Davey, secretary, Public Accounts Committee.

The relative merits of the use of the five standard sizes, from foolscap folio to royal octavo, have been discussed at length by the committee. The further the investigation progressed, the more evident became the need for a thorough, consideration of the problems involved. Your committee has reached general agreement on the need for standardization of parliamentary papers and official reports, and recommends that in the new Parliament an investigation be made as to what size or sizes should be adopted.

These investigations became advisable because the other parliaments particularly of the Commonwealth have already adopted practically a universal size. For this reason, the committee has been undertaking this investigation, lt has not been practicable so far to arrive at any accurate indication as to costs because of the variation in sizes of papers, the number of pages, sizes of type, the inclusion of tables, and type-setting of single or double columns. We have been studying comparative costs for a 32-page report of crown quarto and of royal octavo and also that, as at present, of foolscap folio. It seems evident that the charges could vary between 5 per cent, and 15 per cent, and may in some cases be even lower than that. The Commonwealth Government Printer has said that he will make further investigations during the forthcoming recess and we have recommended that the committee in the next Parliament should continue those investigations.

Report - by leave - adopted.

page 771

CUSTOMS TARIFF VALIDATION BILL 1958

Bill received from the House of Representatives.

Standing Orders suspended.

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

Second Reading

Senator HENTY:
Minister for Customs and Excise · Tasmania · LP

– I move -

That the bill be now read a second time.

The bill now before the Senate provides for the validation, until 30th June, 1959, of the collection of Customs duties under the following proposals: -

Customs Tariff Proposals No. 5 of 14th August, 1958;

Customs Tariff Proposals No. 6 of 11th September, 1958;

Customs Tariff (New Zealand Preference) Proposals No. 3 of 11th September, 1958;

Customs Tariff (Canadian Preference) Proposals No. 3 of 1 1th September, 1958;

Customs Tariff Proposals Nos. 7 and 8 of 1st October, 1958;

Customs Tariff (New Zealand Preference) Proposals No. 4 of 1st October, 1958; and

Customs Tariff (Papua and New Guinea Preference) Proposals No. 2 of 1st October, 1958.

As honorable senators will be aware, the bill is purely a machinery measure. Unless tariff alterations are enacted or validated within six months of their introduction into the Parliament, or before the end of the parliamentary session, whichever happens first, the alterations are open to legal challenge. The bill merely safeguards the position until 30th June, 1959. I commend the bill to honorable senators.

Debate (on motion by Senator McKenna) adjourned.

Sitting suspended from 5.45 to 8 p.m.

page 771

AIRLINES EQUIPMENT BILL 1958

Second Reading

Debate resumed (vide page 770).

Senator O’BYRNE:
Tasmania

.- When the debate was interrupted, I was speaking of the significance of the present era in the development of civil aviation in Australia. I was expressing regret at the fact that at this very important stage in the expansion of the industry, we are making such a drastic change in the type of aircraft to be used on Australian airlines. Most people believe that we should continue to favour British aircraft because British aircraft manufacturers have made a magnificent contribution to the development of aircraft in war and peace. Especially is this so of the Rolls Royce organization which was responsible for the production of the Vickers Viscount aircraft which is so popular in Australia.

This bill seeks to provide for the purchase of eighteen American aircraft and six British aircraft. It appears that during this period of radical change in aircraft development we are departing from the former practice of buying British aircraft and committing ourselves to the purchase of American aircraft, spare parts and so on. As the development in air transport is so rapid, it is possible that decisions which we consider to be wise to-day will prove to be incorrect in three or five years’ time. In those circumstances, and even though, as Senator McKenna suggested, there might be some tie-up with the defence aspect in connexion with these negotiations, I do express profound regret at the fact that it is not proposed to concentrate on the use of such aircraft as the Vickers Viscount and, for that matter, the Comet Mark IV., which has just been granted its certificate of airworthiness by the Department of Civil Aviation in England. The Vickers Viscount has proved most efficient in Australian airlines. It has achieved excellent results for T.A.A., as will be seen from an examination of the loadings of that organization. The difficulty experienced very often by people in obtaining seats on these Vickers Viscount aircraft should be adequate proof that the Australian people desire the retention of the Vickers Viscount in our airlines. I again express regret at the fact that the Vickers Viscount is to be displaced by aircraft produced not in Britain but in another part of the world.

I submit that this legislation follows the pattern of the bills introduced in 1952 and 1957 in that it seeks to weight the scales very heavily against T.A.A. I do not wish it to be thought that I am casting any aspersions at the Ansett-A.N.A. organization, its staff, administration or equipment. On the contrary, I think that Mr. Ansett’s rise to eminence in civil aviation has been one of the most meteoric that Australia has seen in recent times. He must be given full credit for his business acumen, and our objections to the bill are not directed so much at Ansett-A.N.A. as they are against the Government’s policy. The Government has often proclaimed loudly that it believes in encouraging private enterprise, that it believes in competition. In actual fact, the Government’s policy has produced the disappearance of private enterprise from the air transport industry. By measures such as the one under consideration, by the restraint, it has placed on the development of T.A.A., and by what is virtually a system of subsidy assistance to Ansett-

A.N.A., this Government has suppressed both private enterprise and competition in this industry.

In 1957, Mr. Ansett was reported as having said that the directors of his company were absolutely convinced that if private enterprise was to prosper and compete effectively with the privileged governmentowned airline, competition between private airlines must be eliminated. This bill aims at making it possible for those two great enterprises - T.A.A., which has rendered great public service to the Australian people, and Ansett-A.N.A., which operates under the guise of private enterprise - to work together in eliminating competition in this industry. The claim of the Minister and other speakers on the government side that the Government is sustaining competition falls on very barren ground.

During his second-reading speech, the Minister mentioned some of the restrictions he has placed on the operations of the airlines of Australia, and I propose to show how heavily the scales are weighted against T.A.A. by quoting again some of the restrictions to which the Minister referred. For instance, the Minister said -

First of all, an estimate is to be made of the traffic on competitive and non-competitive routes during a specified period. A determination will then be made on the basis of an optimum revenue load factor of the aircraft capacity necessary for the Commission and the Company respectively to carry one-half of the total traffic on competitive routes and to operate its competitive services during that period.

The element of competition is completely eliminated there. In effect, the Minister will be given an estimate of the total amount of business available. He will then determine how much of that trade shall go to one airline and how much to the other. If that is a typical example of competition, it is certainly a new departure from the ordinary definition of competition as I understand it.

The Minister went on to say -

Neither airline must provide on competitive routes, during the specified period, more aircraft capacity than is necessary to carry half the estimated traffic at the pre-determined revenue load factor.

Here again, competition is eliminated in actual fact. Despite the wonderful service rendered by T.A.A., the scales are being weighted heavily against that organization.

The Minister proceeded -

The operators must dispose of any aircraft capacity in excess of that required to operate their competitive and non-competitive services after making due allowances for the need for stand-by aircraft, maintenance and overhaul of aircraft and crew training and similar matters.

Again the element of competition is reduced to. a simple division of the total traffic available. A progressive and expanding airline is being brought back to the standards set by its nominal competitor.

The Minister added -

Finally, there is an obligation on the airlines not to acquire additional aircraft which would result in the capacity limitations being exceeded and not to introduce aircraft of a type which, having regard to the types already in operation, would bo detrimental to the stability of the air transport industry.

In my view, that excludes even competition between aircraft manufacturing companies. The purchase of the American aircraft will exclude the Comets and the Vickers Viscount from the field of operations. Honorable senators opposite, in their somewhat half-hearted support of this bill, have stressed that competition is the key note of the country’s activities and that the Government must sustain private enterprise and, in turn, competition. When they look at our hydro-electric schemes, gas corporations, railways, bus services or, for that matter, the post office, do they feel that they should set up and subsidize private companies to compete with those government undertakings? To contemplate such a state of affairs is ridiculous. Do honorable senators opposite consider that the people of Australia should bear the added burden of providing competitive services in those fields? The duplication of organization that we have in the field of aviation simply means that the taxpayer and the air traveller pay for those duplicated facilities.

Qantas is purchasing a number of Boeing 707 aircraft. Although the Comet Mark IV. does not have quite the same range and speed as the Boeing, at this stage of Australia’s development the Comet aircraft would meet our needs equally as well as the Boeing. It is well known that the Boeing has a very high wing loading and, as a result, the airstrips on our aerodromes will have to be extended and strengthened to carry the extra weight that will be placed on them,. To equip the aerodromes in the main capital cities with hangars and other facilities to handle these heavy aircraft is estimated to cost up to £30,000,000 or £40,000,000. Australia has entered into an agreement with the United States of America for reciprocal international airline operations which means that Qantas aircraft may travel across the United States, and we can expect that United States aircraft will enter Australia. Such aircraft, therefore, will require airstrips of a greater carrying capacity than they have at present. The expense involved in improving and extending our airport facilities could well have been deferred for a number of years if the Government had been content to use the Viscounts on our internal lines and the Comets on our international lines. A great deal of pressure, no doubt, will be applied to the Department of Civil Aviation, and the Treasury, for finance to provide the facilities which will give the heavy Boeing aircraft the opportunity to operate continuously and safely in all weather. To introduce a measure such as the bill before us at this late stage in the life of this Parliament is wrong. A bill with such longrange implications should remain in abeyance until the new Parliament assembles.

In his second-reading speech the Minister said that the bill will give him the power to determine the routes, time-tables, fares, freight rates and related matters in respect of airlines operating in Australia, but the task of co-ordination will be greatly simplified because the number of aircraft has been pegged to the level which will enable the airlines to carry out satisfactorily their domestic tasks. This proposal will tie the hands of the Australian National Airlines Commission and T.A.A. Over the years many imposts have been placed on T.A.A. and, for the information of honorable senators, I shall quote again the figures contained in the thirteenth annual report of the commission for the year ended 30th June, 1958. Air route charges paid to the Commonwealth amounted to £152,000; fuel tax to £469,000, and payroll tax to £106,000; making a total of £727,000. Incidentally, T.A.A. has been penalized to the extent that the diesel fuel tax has acted unequally against it because the other airlines use aviation petrol. In addition, a dividend of £218,000 has been paid to Consolidated Revenue, making the annual contribution by T.A.A. to the Commonwealth, £946,000.

We do not know whether Ansett-A.N.A. has produced similar figures to its shareholders because, being a proprietary limited company, the balance sheet is not available.. Therefore, we are not in a position to gauge the financial stability of the company which is being guaranteed by the Commonwealth Government.

Since beginning operations ten years ago, T.A.A. has paid a total of £6,000,000 in air route charges and aviation fuel tax. Not only is T.A.A. performing a great public service by transporting people efficiently and quickly from point to point, not only has it elevated the standard of aircraft travel in Australia so that it is equal to, if not better than, that provided by other airlines in the world; but it is also producing a considerable amount of revenue for the Commonwealth.

The proposal now before us, like the proposals of 1952 and 1957, will weigh down the scales heavily against T.A.A. If Ansett-A.N.A. may approach the Government for assistance, which is given under the guise of sustaining competition and private enterprise, it is only right that the balance-sheets of that company should be available to the Senate.

I support the policy of the Australian Labour party in this matter. We oppose this measure. If private enterprise is to exist in Australia, it must stand on its own feet. The same facilities for obtaining finance are available to Ansett-A.N.A. as to any other private business. If that company is unable to compete with T.A.A., that is just too bad.

The Government’s decision to purchase American aircraft is most unwise, particularly as it will involve the expenditure of dollars at a time when our overseas balances are so precarious and when the British aircraft industry, which needs so much help and which has done such good work in the past, can supply the aircraft that we need. I therefore support the speech that was made earlier by Senator McKenna. We on this side propose to vote against the motion for the second reading of this bill.

Senator WRIGHT:
Tasmania

– To-night the Senate is addressing its attention to an Australian industry which, 1 think, is efficient and of great value to theeconomy. We can rejoice in having twoefficient airlines to serve the internal, requirements of a country such as this - a country of tremendous distances. Those distances gave rise to problems which were almost insoluble until the invention of aviation. It is a matter for intense regret that the Labour party, in the full flush of its extravagant exercise of war-time powers, followed the lamentable policy of damaging an industry which to-day, but for that, would have been conducted magnificently by private enterprise and would have been providing efficient services. That would have been the position now but for the doctrinaire socialist approach which led the Chifley Government to introduce theAirways Bill of 1947.

I remind you, Mr. President, that that bill had two purposes; first, to establish the Government airline, and secondly, to expropriate the undertaking of Australian National Airways. You will recall that A.N.A. had paid its establishment expenses in the form both of cash and lives in the unfruitful years of the pioneering of air services in Australia. That action by the Chifley Government was completely out of keeping with the Australian spirit. That was the time when most of us here came into politics.. We came into politics then to support the people who protested against that ruthless damage to the enterprise and industry of private men.

This afternoon we listened to a speech on this bill by the Leader of the Opposition (Senator McKenna), who was a Minister in the Labour Government responsible for the legislation I have mentioned. He expressed not one word of regret for the unfair, discriminating and arbitrary conduct of that government, which inflicted such damage upon a great Australian enterprise. Rather, he found it an occasion for gloating that that private undertaking, now reduced to a position of pseudocompetition, is struggling to survive, in the same way as the most magnificent private undertaking would have to struggle to survive when challenged by the enormous power of the Federal Government, backed by unprecedented revenues exacted compulsorily from the people by taxation. That was the ideology that we came here in 1949 to combat and destroy. It is significant that the party that adopted that ideology is now divided and almost dead, with no hope in the foreseeable future of gaining political power. I am one of those whose spirit is only slightly stimulated by seeing this pale, moonlit shadow of private enterprise maintained in pseudocompetition with a government undertaking.

In 1952 the Menzies Government was confronted with the situation that the High Court had invalidated the measure by which the Chifley Government had attempted to expropriate A.N.A. Led bv that resourceful Australian, whose death we lament. Sir Ivan Holyman, A.N.A. had taken up the challenge. He determined to maintain his enterprise and, in the result, the legislation was invalidated. Then, in 1952, this Government adopted a unique method of solving the problem that existed. In the Senate, a House of review, we can afford the time to indulge in the pleasure of studying the idea that occurred to the Government for the solution of the problem. The solution was, T suggest, unique in political science. The Government adopted the expedient of maintaining the Government airline and of giving succour to its competitor - which then still had the form of a private enterprise - by giving it a fair share of Government air transport business and by according ‘it financial guarantees - guarantees without which it could not have maintained, in 1952, the standard of its air fleet.

Let us consider the position thoughtfully to see whether that experiment has succeeded or failed. We are all sadly aware that A.N.A. found it necessary to offer its undertaking for sale, and that it was purchased by the Ansett organization. I know nothing of Mr. Ansett, except what I have read of his career, but I should think that he is as typical an Australian as was Sir Ivan Holyman. So far as T know, he started with nothing, but, urged on by his spirit of purpose and aided by his resourcefulness, he built up a transport and travel organization of which any country could be proud. By his enterprise and initiative, and by the inspiration that he gave to those who cooperated with him, he built up the greatest transport undertaking that Australia has ever seen, yet honorable senators opposite sit there gloating over the fact that the Government airline will be able to subdue Mr. Ansett’s organization unless this Government comes to its aid, fairly and undiscriminatingly, and gives it a fair share of business.

Senator Sandford:

– You are not dinkum.

Senator WRIGHT:

Senator Sandford, speaking from his prostituted level of outlook, says that I am not dinkum. When such an assertion comes from such a miserable representative, I say no more than just those few words to indicate the contempt with which I look down on him.

In 1952 a proposition was put to the Parliament which I thought was based upon an approach that would guarantee stability as between these two airway undertakings, which would guarantee that their future would not depend upon political vicissitudes, and which would guarantee to T.A.A. the very freedom which enabled A.N.A. to survive - that is, an equal and undiscriminating freedom as to interstate trade. I understood that the 1952 legislation was based upon agreement between the two undertakings and that the obligations imposed by the agreement would not be governed by section 92 of the Constitution. I understood, too, that the agreement was to be for fifteen years and that it was on a basis of rationalization - that blessed term, that much abused term - which would enable both organizations to survive and render service. But it is now history that some of us were mortified when we learned that the agreement was not an agreement between T.A.A. and A.N.A. but was really an agreement between the Government and A.N.A. and that the obligations imposed upon A.N.A. were statutory and therefore, if in conflict with section 92, of no avail in rendering a uniformity of business as between the two competitors when other political forces gained control of this country.

Six years have passed and now we have before us a measure in relation to which the Senate is invited to endorse the decision of the Government, first, to approve, as I understand the situation - I am subject to correction - a loan from the American banks of £13,000,000 designed to reequip Qantas and T.A.A. Of that amount, £3,000,000 is to be devoted to T.A.A.

Judging by the interjections of honorable senators, there seems to be some conflict as to the figure. Forgive me, Mr. President, if I confuse the millions, and if I confuse the dollars with the pounds. It is some figure the significance of which I have difficulty in comprehending; it transcends all my experience.

We are asked to approve a loan for the re-equipment of T.A.A., and to give authority to the Government to guarantee the additional capital that is required for the re-equipment of Ansett-A.N.A. By borrowing for T.A.A. and guaranteeing capital for Ansett-A.N.A., the public credit of this country is being committed. And in what circumstances are we asked to do that? The capital to be devoted to T.A.A as an outright grant of capital by the Government is, I understand, £5,000,000 short of the requirements of its re-equipment programme.

I think there is some strength in the Opposition’s statement that both Houses of the Parliament are asked to deal with the situation which confronts Ansett Transport Industries Limited without complete, indeed without much, information as to the organization’s financial structure. I think that objection from the Opposition needs re-consideration. It is the inevitable requirement of parliamentarians and of persons who are charged with the responsibility of expending the people’s money that they should know the financial structure of the undertakings that are to be assisted by public expenditure. What have we before us as business men for the purpose of considering the pros and cons of the purchases these two undertakings intend to make?

I am not able to speak of the virtues of the Electras or the magnificent performance of the Caravelles or the Viscount 800 Series. I am daunted by them; I do not understand them. But placed in charge of T.A.A. are gentlemen of the calibre that is indicated simply by a recital of their names. They are Warren McDonald, Sir Giles Chippindall. A. S. Blackburn, V.C., Mr. Vial and Mr. Murdoch. I should have thought that they had gone to the management of that undertaking so that their experience could be expressed. We have on the other hand, a private enterprise organization, the directorate of which I do not know, but which is led by Mr. Ansett.

As the inevitable concomitant of government assistance come government control and the usual unfruitful management of Ministers when applied to government business. Do not let me be misunderstood by those who get some fun out of the mere phrase I use. I may be critical on matters of principle and in the defence of the principles that I came here to represent, and differences of opinion will inevitably occur. But for no Minister has one more regard than the Minister who is in charge of this difficult assignment, the Hon. Shane Paltridge, whose business acumen and judgment perhaps it ill becomes me even to refer to, much less to criticize. Nevertheless, principles should be expressed in this chamber if one feels that they are good.

But I point out that, when government business comes under the direct management of Ministers, the success of that business depends upon the acumen of the Minister of the day. Not necessarily because he belongs to a particular political party will he be efficient in the running of an enterprise. He will be trammelled by political considerations, whatever party he belongs to. Those are handicaps which ministerial office can enable no person to transcend. Therefore, when I say that business management is at a disadvantage when it is placed under the direction of a Minister, that is not a reflection upon any individual person. It is an observation on the system. These two undertakings, dependent on government assistance by way of finance, have imposed on them under this bill certain conditions. Clause 12 provides that - (1.) The Minister shall, from time to time, in relation to a specified future period -

  1. estimate the total traffic on -

    1. each of the competitive routes;
    2. the non-competitive routes of the Commission; and
    3. the non-competitive routes of the Company; and
  2. determine the maximum aircraft capacity of the aircraft required by the Commission and the Company, respectively, for the purposes of -

    1. carrying one-half of the total traffic estimated by the Minister in respect of the competitive routes; and
    2. operating its services on noncompetitive routes;

That is to say, there is superimposed on each of these undertakings a managing director, superior to the board of management of each of them, who has directing power as to the aircraft capacity that either may acquire. To show the virulence with which this idea has penetrated the bill, clause 12 goes on to indicate that the Minister shall have regard to rates of traffic increase; the types, speeds and reasonable extent of utilization of aircraft; the revenue load factor; the necessity for overhaul and maintenance; the necessity for having aircraft available to meet emergency situations; and any services operated otherwise than by the commission or the company on noncompetitive routes.

In fact, surveying all the exigencies which a business management would of course take into consideration, the Minister is given the final power to direct and control each of these undertakings in regard to the aircraft capacity that it shall operate. To indicate the extent to which this control goes, I point out that clause 13 provides that -

The obligations that are … to become applicable to the Company and the Commission upon the giving of a guarantee cn behalf of the Commonwealth under section eight of this Act are the following: -

where the Minister has made a determination under the last preceding section - that is, as to aircraft capacity - . . an obligation not to provide, on the competitive routes, during that period, air services capable of performing a number of revenue traffic ton-miles in excess of the aircraft capacity specified in respect of the competitive routes . . .

The clause goes on to provide that where, at any time during the period, the Minister has made a determination and has notified the undertakings of it, each of them is under an obligation to dispose of aircraft to the specified extent communicated by the Minister.

Simply put, Mr. President, that provision places the Minister in the position of a superior governing director, with powers to override the management in respect of those vital factors. Of course, as the Minister has explained to us in his second-reading speech, he is well-intentioned and has a definite purpose to exercise those powers so that there shall be the greatest service of the public interest. That is the proclamation of every Minister in office. But the fact is that there are few people in the community who regard that as the most satisfactory method of direction of any business, whether operated by private enterprise or a government instrumentality. We have reached the stage at which, I should think, the majority of socialists consider that government enterprise is best managed by an independent commission, free from the immediate direction of Ministers. Certainly we should support private enterprise, though it will sicken under the dead hand of government control. I have put forward these views, Mr. President, for the sober consideration of the Senate, because without an agreement that will enable these two undertakings to survive a challenge under section 92 of the Constitution, should such a challenge be provoked under another political regime, are we really advancing the aviation interests of Australia by continuing the present pseudo competition?

We are considering these matters in a chamber whose powers of review are almost co-ordinate with the powers of the House of Representatives to legislate. But I think that it would be an imprudent exercise of our powers if, in relation to a measure involving such direct financial commitments undertaken by a responsible government, we were to impose anything like a contrary opinion on a matter which is so essentially administrative in character. That does not excuse one, of course, from failing to take the opportunity to put forward, for the consideration of the Government, views which I am presumptuous enough to think are based upon reason. I note that Senator Sandford is absent from the chamber at the moment, but I point out that these views are based on deep political convictions.

Senator Cameron:

– Not too deep!

Senator WRIGHT:

– But not so old as yours. Therefore, I suggest, Mr. President, that if it were not at this stage of the session, we could very usefully adopt a practice which, the Senate might be pleased to know, becomes a common course of business in the only independent chamber of review still left in Australia - the Legislative Council of Tasmania. In that place, if a proposition of this sort came up, some responsible person would move for the adjournment of the debate, as an indication that members would like to hear from the entrepreneurs in the undertaking. Then, those of us who were interested would repair to our committee room and hear Mr. Ansett for an hour, and Mr. McDonald for an hour, and it may be, after that, call in the Director-General of Civil Aviation for his explanation. But, of course, such a course is impracticable to-night.

It might be wise, too, to refer this bill to a committee. We could come back here next Wednesday or Thursday and hear what the committee thought of it, after close discussion with those concerned. That, too, I feel is impracticable. In those circumstances, Mr. President, it seems to me that the proper thing for the Senate to do is to pass the bill, but to leave with the Minister matter fit for his consideration.

Senator COLE:
Leader of the Australian Democratic Labour Party · Tasmania

– 1 cannot see why members of the Australian Labour party are opposed to this bill except for the reason that that party believes that there should be only one interstate airline in this country. I should like to state my party’s policy on this matter. We do not believe in monopolies whether they be of a State or private character. I believe that it would be detrimental to the people of Australia if only one major airline operated in this country. Therefore, my party wants to see two or more well-equipped and wellserviced interstate airlines operating. We do not want a monopoly - especially a State monopoly - to be established in this field; we believe that that would be the very worst thing that could happen. If we look at the history of monopolies we find that the conditions of the workers under State monopolies have been worse than those of persons employed by private enterprise monopolies.

My party believes that there is no need for much discussion on this measure. The greater part of the subject-matter of the speeches we have heard during this debate has been devoted to determining which of our major airlines - Ansett-A.N.A. or T.A.A. - is the better. Well, both are good airlines, in that each must conform to certain regulations and conditions prescribed by the Department of Civil Aviation. I do not want fierce competition to develop between those airlines. Personally, I prefer to keep my feet on the ground, although statistics support the contention that has been made that air travel is safer than surface travel. I believe that the development of fierce competition between the two major airlines could lead to disaster in the future.

The measure before the Senate provides for the re-equipment of the two major airlines. In relation to one of them, it is proposed that the Government shall provide the money, and in the other case, the Government will guarantee the company to the extent necessary to enable it to reequip its fleet. I should like to see that re-equipment of the two airlines undertaken; to turn down this bill would be equivalent to putting a clock back. Our two major airlines need all the aircraft in good condition and all the navigation facilities they can get.

I think it would be a retrograde step it only one major airline were permitted in this country. The elimination of one of the two major airlines would result in the dispersal of trained technical staff among other industries. This would react detrimentally against Australia if in the noi distant future this country had to engage in a fight for its existence. Therefore, I consider the more airlines and the more trained personnel we have the better. We know that defence in the air is the most important aspect of defence in this country. Consequently, the more airlines we have the safer we may feel.

About 14,000 trained personnel are employed by the two major airlines. We want this trained staff to remain in the industry. I believe that the maintenance of transport aircraft by the two major airlines constitutes a safeguard for this country. If Australia were ever attacked - and we must remember that we could be attacked at any time in view of the position that exists in Dutch New Guinea and other countries tr the north of Australia - transport aircraft would be needed to convey troops to various parts of this country. Troop transport aircraft would be needed urgently in the event of attack. Therefore, I consider that it is necessary in the interests of defence to keep the two major airlines operating efficiently.

I repeat that my party cannot understand why this bill, which is designed to enable the re-equipment of our two major airlines, is being opposed by the Labour party. Members of that party have stated that the Government is interfering with T.A.A. in relation to the choice of aircraft. Caravelles have been mentioned. As it will be necessary to improve our aerodromes so that the larger aircraft can be accommodated, the Government is entitled to exercise its influence in relation to the choice of aircraft. We know that the aerodromes throughout Australia are not adequate even for the types of aircraft now in use. Viscount aircraft are not permitted to land at the Devonport aerodrome because the landing strip was designed only for D.C.3 aircraft. A similar position exists at other aerodromes in Australia. In order to provide satisfactorily for the types of aircraft that were mentioned by Senator McKenna, many of our aerodromes will have to be strengthened’ and lengthened, and additional facilities will have to be installed. As it will fall to the Government to provide these additional facilities, I think it is entitled to say to the government airline, as well as to the private airline, “ You may operate only certain types of aircraft from the existing aerodromes, but when we have strengthened them and extended them we will consider permitting you to use them for the other types of aircraft you desire to take into use.

Although I am not well versed in aeronautics, I believe that only a limited field of operation would be available in this country for jet aircraft. Therefore, I do not think we need devote much time to a consideration of which of our two major airlines is the better. As I said at the outset, I do not want great competition to develop between them. The people who have invested their money in Ansett-A.N.A. are entitled to a reasonable return on their investment. We must realize that those investments have relieved the Government of the necessity to provide money for the development of the airline. I reiterate that I think the development of fierce competition now between our two major airlines would lead to trouble in the future. It is futile for any one to say that a private airline can compete successfully against a government airline. The Government airline is not required to provide a dividend. A private airline must, of course, do so. For that reason a certain amount of rationalization must take place and, because we do not believe in monopoly control, we support the Government’s efforts to keep the second airline going. If there were allout competition there would soon be only one airline in Australia. We do not want that to happen. For that reason, we support this measure, as we supported the 1957 legislation. I do not think that 1 need traverse all the matters which have been mentioned during this debate. I wish merely to give the outlook of our party on civil aviation, and on the future of the two major airlines in particular.

Senator cooke (Western Australia) [9.1]. - To-night, we have had the unique privilege of hearing the Government vindicate a policy which has been closely followed by Labour - that if the good of the community demands it the Government should step in and ensure that national rights are protected. The only difference between the two sides is that the Government is prostituting its own policy. When any government enterprise proves successful the present administration sells it at a ridiculous price to people, inside or outside of Australia, who are prepared to rob this country of its birth-right. Trans-Australia Airlines has been successful and we are always fearful that, for that very reason, the Government may deal with it as it has with other succesful public enterprises.

I have no quarrel with Ansett-A.N.A., nor has any Opposition member. We have no quarrel with Reg Ansett and his group. They are engaged in business enterprise and are doing a good and honorable job - establishing themselves competitively. It is idle to deny that Australian National Airways Proprietary Limited failed simply because it was inefficient. In saying that, I cast no reflection on the respected administrators of that organization. Their judgment simply was not good. The fact that an accountant who had been with the organization for only three months could take £32.000 out of its funds is itself proof of inefficiency. Again I emphasize that I do not wish to cast any reflection on the directors, or upon the organization as a whole.

The Government claims that Labour established T.A.A. for the purpose of crushing private enterprise. That is not so. As any Government supporter knows, we had to seek the right to control the airways of this country. That was given us. We sought it because it was essential to both national development and defence. The organization had to provide good service and train flying personnel to meet the needs of a country which was undeveloped and poorly protected. We had to be sure that, in both peace-time and war-time our air transport and air defences were not less modern than those of any other country.

One marvels at the hypocrisy of people who can come here and tell the nation that the anxiety of the Opposition to ensure that T.A.A. remains an efficient and profitable Government enterprise is prompted by ulterior motives. We are forever hearing from the Government that public enterprise cannot operate successfully. The various State railways are described as being burdened with the dead hand of Government control. When that is said one hears nothing about competition. The State Government railways operate for the good of the community as a whole. They go out into undeveloped areas and are run at a loss in order to develop them. They carry school children at concession rates, and provide essential public services - the accounting expression used is “ unremunerative service.” This Government delights in directing attention to the failure of State railway systems to pay a dividend, but to-night we are in the unique position of hearing the Government admit that a public enterprise has not only been successful and beneficial to Australia but has also contributed greatly to Consolidated Revenue. T.A.A. has been able to pay its fees ever since its inception: its ledger is clear.

When the Government speaks of fair competition it has in mind the fair competition that was given to the Australian Whaling Commission. We had in Albany a small company formed of young returned soldiers from the last war. One of them was Buzz Farmer, a popular journalist and a great athlete. He was there shooting whales with the rest of them. Another organization was the Nor West Whaling Company. Then the Australian Whaling Commission came into the field. Each had its quota, but the Australian Whaling Commission proved eminently successful. There was no talk of unfair competition. The national undertaking was doing so well in the face of competition that it had to be destroyed. It was sold for a ridiculous price. The cost to the new owner has been amortised in a few short years and this great undertaking - which was established by Labour - is now returning 114 per cent, profit to investors. The dividends are 500 per cent, greater than they would be under normal competition. The Government sold this great national asset to certain investors. The shares of the new operating company did not even hit the share market. In this matter the Government was not even fair to the people who supported it - the investing public.

Government supporters may ask what we are afraid of. The Government has reached the stage where it cannot assert, with political safety, that T.A.A. should be put out of the field, as was done with the Australian Whaling Commission. Undoubtedly, however, it would like to sell T.A.A. to private enterprise, which would readily absorb it. The Government, seeks to break down the organization gradually. It now says, “ By fair competition, we shall restrict and retard the management of T.A.A. because that organization is much too successful. We shall guarantee advances to private enterprise and we shall not bother to submit to the National Parliament any solid business reason for our actions. We do not like monopolies.” Why, any one who has any knowledge of the principles for which the Liberal and Australian Country parties stand will look upon that as the joke of the season! And it is the joke of the season because the members of the Liberal and Australian Country parties have been financed into office by the monopolies.

Having spoken of the Government’s policy, let me refer now to the Labour party’s attitude towards these matters. The Labour government established T.A.A., the national organization which has been so successful that this Government now seeks to restrict its activities. The Government is afraid because it has been so successful. If the combines which the Government supports have a reasonable proposition to submit, if they can produce balance-sheets to show that they have the necessary security, why does not the Government send these people to the proper authority - the Commonwealth Bank - for finance, as a Labour government would have done? The Government will not do so because the whole matter has now become a political issue. Instead of going to the credit fonciers ofthe nation and proving to them that they have sound security, these people come to the Government, and the Government, in an effort to be extremely careful on this vital political issue, says, “ We are not giving these people money; we are only guaranteeing them “.

That attitude reminds me very much of the story about the young business man who said to his very wealthy father, “ I want to start in business and need a loan of £3,000,000. The bank manager has told me that if you will affix your signature to this guarantee I can have the money.” His father said to him, “ Son, go back to the bank manager and tell him that if he will affix his signature to the guarantee I, your father, will advance you the money “. A similar position arises here. The Government is using public money to guarantee a proposition that would not bear scrutiny based on sound principles of making monetary advances.

At this stage, let me say that I admire Senator Wright for his courage in criticizing the measure as he did, but he spoilt it all by saying that he would vote for the bill. He should have been big enough to carry his attitude to the logical end by indicating that he would .vote against the measure.

The principles underlying the bill are bad. If the Government had advised T.A.A. to arrange credit through the great banking institutions which the Government says are so beneficial to the nation, this huge amount of public money which the Government proposes to use for the purposes of a guarantee, would have been saved for the taxpayers. By the Government’s action, air transport in Australia is to be reduced to a standard at which both ‘organizations can operate -without damaging each other. No thought whatever is given to -the important factor that we had to consider - the urgent need for a most efficient air transport organization to defend our small population in time of war. It appears to me that this Government is adopting the Russian -policy of co-existence rather than that of rationalization. The Government’s attitude seems to be that if Ansett-A.N.A. is capable of rendering service of a certain standard T.A.A. must come up to that but if, on the other hand, the service rendered by T.A.A. is infinitely superior to that offered by Ansett-A.N.A., then T.A.A. must .reduce .its standard ito .that .of Ansett-A.N.A.

If further proof of the Government’s restrictive policy be required, I need only point to the position of others who would wish to operate in the industry on as big a scale as either Ansett-A.N.A. or T.A.A. I shall not mention their name. We all know to whom I refer. They have no hope whatever of being able to intrude into this field of operations. Legislation such as this prevents their doing so and, in fact, could prevent their entering into the industry anywhere else.

We have heard nothing but arrant hypocrisy to-night from this Government, the champion of private enterprise, which is faced with adopting one of two courses. Either it must seek to stop the rot by utilizing public money or it must adopt Labour’s policy of releasing the credit of the nation to the nation’s capacity to earn and the worker’s capacity to produce. Senator Wright certainly spoke the truth to-night, and I repeat that it is a great .pity that he did not indicate that he would oppose the measure.

We have put the position clearly and concisely. We have explained how a great, successful national institution is being destroyed gradually. The gun has been pointed at it, so to speak, and the Government has threatened that in time it will flatten this organization out. This bill is the second step in the Government’s efforts to do so.

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

.- I rise to indicate the attitude which I propose to take in connexion with the vote which will be taken subsequently. I have listened with considerable interest to the arguments advanced, especially those adduced in connexion with the Airlines Equipment ‘Bill 1958 and the provisions contained therein. I think that one of the overriding considerations is the desirability, as expressed by Senator Cole, to avoid a monopoly, whether in private or government hands. Another important consideration in our approach to this measure is the necessity for a high technical -standard in the operation of airlines, stemming from free and untrammelled competition. Legislation of this character :first .came before Parliament in 1952 and, had I been a member of this chamber at that .time, I should .have .opposed it. In 1.957, when the next similar .legislation was introduced, I was absent from the Parliament and, therefore, did not vote on the proposals put forward by the Government. As the measure now before us is more or less a continuation of the 1957 legislation, I feel that I am not entitled to express, by my vote, a formal attitude. While expressing my point of view, I shall abstain from voting.

Senator Henty:

– The honorable senator is having two bob each way!

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

– The position is not altogether as the Minister states. If it were my intention to have two bob each way, I should not have expressed my position but merely would have refrained from voting. Instead, I have stated my attitude to the Senate.

The most compelling fact emerging from this debate is the necessity to preserve competition and avoid monopolies for social, economic and technical reasons. The Government is not involved in any actual expenditure in assisting Ansett-A.N.A.; it is merely buttressing the loan possibilities open to the company when it approaches the market for the money necessary to reequip its fleet of aircraft. After giving the matter a good deal of thought, I have come to the conclusion that two competing airlines cannot survive in this community. That position will become more and more apparent as times goes on. Some time ago during the adjournment debate I asked the Minister when the last financial assistance was given to A.N.A. because that company was then in a state of financial deterioration and, in my opinion, that fact had not been disclosed to the Senate when we were asked to pass certain legislation.

Senator Anderson:

– The honorable senator would not suggest that is the position to-day.

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

– I do not make that suggestion, but we were not fully acquainted of the financial position of the company at the time. If my contention is correct that two competing airlines cannot operate economically in this country, this legislation is extremely unwise and I should have no alternative but to oppose it because, on the dissolution of one of the airlines, the aircraft proposed to be purchased could not be properly, economically and technically integrated into the fleet of the surviving operator. Alternatively, if Ansett-A.N.A. should encounter the difficulties experienced by its predecessor and it should be necessary to integrate that company’s aircraft into some national airline, that can be done if Viscounts, Electras and Fokker Friendships are purchased because they will be the same types of aircraft as those in the T.A.A. fleet. To that extent I think that the legislation is justified.

The Government also has a moral obligation in this matter. When a contract from which springs moral obligations is entered into, the contracting parties must carry the contract through to its conclusion. Therefore, in the background of the circumstances of the last six or seven years, it would have been morally indefensible if the Government had denied to this company the opportunity to purchase - by guaranteed assistance - the type of aircraft which it proposed to buy.

Honorable senators will acknowledge that my vote on this occasion will not be decisive but, although I feel under a personal obligation to refrain from voting because of my absence when similar legislation was before the chamber in 1957, nevertheless I feel myself under an obligation to explain why I adopt that course. While I may support in principle measures such as the Loan (Qantas Empire Airways Limited) Bill and the Loan (Australian National Air Lines Commission) Bill, I refrain from participating in any division that may be taken on this measure for the reasons that I have outlined.

If I am right in my submission that only one airline will emerge due to the natural characteristics of Australia and our limited economic circumstances, and if by administrative act, legislation, public consent or force of circumstances, only one airline does emerge in the future, let it not be said that every opportunity was not given to all operators in the field. If financial assistance were denied to Ansett-A.N.A. and if ultimately only one airline survives, honorable senators would leave themselves open to the charge that they had precipated that state of affairs by denying to all operators the opportunity to function.

This legislation represents perhaps the last opportunity given to the private operator. If he cannot carry on with this support, those honorable senators who agree with my submission will be able to say that every avenue for success was opened to the airline.

For those reasons, Mr. President, I shall refrain from voting on the three bills. 1 shall look with tremendous interest to the effect of this legislation upon the private operator. If he cannot carry on economically and within the limits of competition allowed by this measure and with the proposed financial support, the nation undoubtedly will have to face up to the only alternative offering. At this stage, I should imagine a unanimity of opinion exists among all honorable senators on this important question.

Senator PALTRIDGE:
Minister for Shipping and Transport and Minister for Civil Aviation · Western Australia · LP

– in reply - The Evatt Labour party opposes this legislation because allegedly discrimination will be exercised against T.A.A. Indeed, the last speaker from the Evatt party, Senator Cooke, addressed himself with characteristic vigour to the bill and stated that he feared that the Government was in some way preparing to sell T.A.A. Of course, that is an argument with which we are rather familiar. From time to time we hear that sort of argument but it is discounted because events have proved it to be so faulty on so many occasions.

The Labour party does not oppose this bill because of discrimination against T.A.A. It opposes it because, in 1957, as in the years gone by, it is bent upon putting the private operator out of business. That is the historical background to the approach of the Labour party to this industry, as demonstrated to-night by Senator Wright. That is the approach the Labour party will make now and at any time when it has the opportunity to do so. Possibly one thing that ought to be said to-night is that this approach of the Labour pary will be noted with great interest in the electorates of Maribyrnong and Lalor in Victoria, and St. George and Kingsford-Smith in New South Wales, where 4,000 employees of the Ansett-A.N.A. organization will learn that, on the eve of an election, the Labour party stands opposed to the continuance in operation of the private airline.

Senator HARRIS:
WESTERN AUSTRALIA · ALP

– Are you going to send Bob Menzies down to tell them that?

Senator PALTRIDGE:

– I do not think so. 1 think my colleagues, and I myself, might be able to do the job quite well. Senator McKenna referred to discrimination which had been shown in favour of the Ansett organization in the choice of aircraft. Truth to tell, when Ansett and T.A.A. made application in March of this year to be equipped with certain types of aircraft, both their requests were refused. T.A.A. was refused Caravelles and AnsettA.N.A. was refused Lockheeds.

Senator Cooke:

– Yet you say that you do not believe in the Government’s interfering!

Senator PALTRIDGE:

– If my good friend from Western Australia will devote a little attention to what I am saying, he may learn something, because, judging from the speech he made to-night, he knows nothing at all about this subject. The Government always had in mind the necessity, or desirability, of having the domestic air fleets equipped with a type of aircraft which might successfully be operated on the medium or longer runs, but it was not prepared and still is not prepared - I shall say why in a minute - to stand by and allow a diversity of new aircraft types to be introduced into Australia at this time.

From time to time, when we have debated civil aviation and related matters in this chamber, many honorable senators have taken the opportunity to point out to the Government, and to me as Minister, the desirability of some form of standardization. Even the Leader of the Opposition in his speech to-night was forced to admit that there was some merit in standardization. The position was that Qantas had chosen the Lockheed aircraft for its intermediate stage routes, which roughly correspond with the stage routes in Australia for which we intend to use this type of aircraft. The New Zealand government has also chosen the Lockheed Electra for a similar stage route. The C130 aircraft, the Hercules, used by the Air Force is equipped with an Allison engine, the same engine as is in the Lockheed aircraft. Ansett-A.N.A. wanted Lockheeds. Were we then to introduce into the Australian airlines system a completely untried aircraft, which would be used 12,000 miles away from the source of supply of spares and everything else that goes with it, merely to satisfy one aircraft operator, although admittedly a first-class aircraft operator?

Perhaps I should say something about the Caravelle aircraft, because Senator McKenna devoted a good deal of time to it. He referred to it as a more advanced or more modern type of aircraft than the Lockheed. I regret to tell Senator McKenna that, on this occasion at least, he does not know what he is talking about. The Caravelle first flew in May, 1955. The Lockheed flew in December, 1957, two and a half years after the Caravelle first took the air. It was not until June, 1956 - thirteen months after the Caravelle first flew - that the first order was placed for it. How many Caravelles have been ordered so far? Firm orders have been received for 28 of these aircraft, seventeen of them from French airlines operating in France or French territories, and only eleven from outside France. Of those eleven orders from outside France, nine are from places on the Continent in the near vicinity of France. What is the position with the Lockheed aircraft? Not 28, but 161 have been sold. What is the judgment of the airlines of the world?

A lot has been said about the approach of T.A.A. to this problem, and of its disappointment at its final equipment with Lockheeds. In March last, at the annual meeting, in Melbourne of the Royal Aeronautical Society, Mr. John- Watkins, the chief engineer of T.A.A., when presenting the principal paper, the subject of which was “ Selection, of Aircraft for Australian Airlines “, stated that of the available aircraft the French Caravelle and the Electra were equally well suited to the requirements of T.A.A. He went on to say that T.A.A. would be perfectly happy with either aircraft.

The next point of complaint seemed to spring from the suggestion that there had been- discrimination against T.A.A. because T.A.A. had been asked to pay air route charges and’ a tax. on aviation- kerosene. The Opposition- did not take into account, of course, that for years before last year the; private competitor was. paying in petrol tax some £-200,000 per annum more than T.A.A. was paying in tax on aviation kerosene. The next complaint was that T.A.A; was asked to pay payroll tax, income tax and; last of all, dividends. I know, Mr.

President, that it is rubbing salt into the wounds of the Labour party when an enterprise such as this is successful enough to pay a dividend. I know that the Labour party believes that government enterprises, supported by public moneys, should be run at the public expense. But I am pleased to be able to say that, when this Government runs public utilities, it does so almost on a commercial basis and at a profit, and it returns a dividend.

The Leader of the Opposition went to some trouble to say something about the great T.A.A. venture upon which the Labour Government embarked and which, he said, had operated so well. It is true that Labour established the organization, but in the first two and a half years of operation it succeeded in losing some £720,000. In the years since this Government assumed office, T.A.A. has made a profit of almost £2,000,000. It has made a profit every year with the exception of one, and for the last seven years it has paid a steadily increasing dividend. That has been done while the airline has been expanding. To-day it has a bagger and better fleet, a more modern fleet, than it had years ago.

The number of passengers carried annually has. increased, and the number of its employees has- increased. As I have already indicated, the losses that were incurred during Labour’s period of office have been converted, into profits. Those facts constitute a complete rebuttal of the stupid criticism that the Government is discriminating against this organization. Indeed, we have set out in the preamble to various bills that we believe, as a matter of basic policy, in the maintenance of a twoairline system on the trunk routes, and we shall continue to believe in that system.

Another statement made- by Senator McKenna calls for some comment. He said that most people felt more comfortable and safer in government aircraft which were not flown for profit. Much the same thing was said- by the- honorable member for Hindmarsh. (Mr. Clyde Cameron) in another place last- night. On. previous occasions I have said- that every- aircraft which flies in Australia is- safe to fly in. That is a result of the splendid supervision that is exercised by the Department of Civil Aviation, which is exemplified by the fact that

T.A.A. has a completely accident-free record. Lest the comments of the honorable member for Hindmarsh in another place, or those of the Leader of the Opposition in this place, should be construed as meaning that Ansett aircraft are not quite as safe as those of other operators, I would defend the Ansett organization against any implied criticism on the ground of lack of safety, just as I defend T.A.A. In 22 years of successful operation, Ansett has not put a scratch on a passenger, and if in 22 years’ time T.A.A. is in that position, it will be able to be proud of its record. I hope it will be in that position.

The point was taken that the provision for the operation of 50 per cent, of aircraft on the main trunk routes did not leave room for effective opposition. I went to some pains in my second-reading speech to point out that a switch of 1 per cent, in traffic could mean a difference in income to one operator, at very little extra cost, of £190,000. With the load factor for these aircraft fixed at 70 per cent., there is ample room for the most virile competition. Indeed, with a 70 per cent, load factor, it would be possible for one aircraft operator to increase his revenue by some £5,000,000 per annum. The formula that has been applied has been arrived at only after long and intensive study by me and my officers, together with the two operators concerned, who welcome this arrangement. They know that their future stability depends on the fact that there must be no excess of aircraft which are not earning their keep and, at the same time, upon their having a chance to engage in reasonable competition. It may be of interest to the Senate to know that the load figures do not vary very much as between the two operators. At the moment, Ansett-A.N.A. carries 48.2 per cent, and T.A.A. carries 51.8 per cent.

I thought it might be of use if I were to say something about the Ansett organization and about what Ansett has been able to achieve in the ten months that have elapsed since he acquired A.N.A. Everyone knows that he took over quite large commitments from A.N.A. and that, in addition, he undertook to pay to the vendor £3.300,000 over a period of some two and a half years. He has met all his payments under the guarantees, in one instance well ahead of the due date. He has met all his payments to the vendor, too. He now owes only £1,050,000 of the £3,300,000 which he paid for the airline, and he has made provision for the payment of the balance.

When it is recalled that during the last complete year of operation of the airline by the old owners a loss of £253,000 was sustained, it will come as poor comfort to the Opposition to know that, when Ansett reports to the parent company, Ansett Transport Industries Limited, in a few weeks’ time, he will report the conversion in ten months of a loss into a significant profit.

The security that we shall hold against the loan to be raised by him will give us ample cover. As I indicated in my secondreading speech, in order to obtain the guarantees he will have to comply with very strict conditions, and I stated what those conditions were. I said that he would not be permitted to borrow on terms that were not reasonable, that the lender necessarily would take proper security, and that the loan benefits would be transferable to the Commonwealth in the event of any default. There is a blanket provision that the Treasurer may impose any other conditions which he considers necessary.

Senator O’Byrne is greatly troubled that we should be buying four American aircraft when we might be buying British aircraft. He completely overlooks the fact that, although we are buying four American aircraft, there also will be purchased at least six British Viscount aircraft, and that when those aircraft are purchased, there will be no fewer than 21 Viscount aircraft in operation in Australia. It is a fact that the operations of both air fleets pivot on the Viscount, a British aircraft. I have taken rather longer than I had hoped, but I wanted to reply to the few points which were made by Senator McKenna, and to which t thought I should reply. As I said in my second-reading speech, I commend the bill. I believe that it is a significant step towards re-establishing the private sector in the airline industry of Australia.

Senator Sandford:

– I realize that the debate has been closed by the Minister’s reply, but may I ask a question?

The PRESIDENT:

– Order! The Minister has closed1 the debate.

Question put -

That the bill be now read a second time.

The Senate divided. (The President - Senator the Hon. Sir Alister McMullin.)

AYES: 29

NOES: 18

Majority 11

AYES

NOES

Question so resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without amendment or debate.

page 786

LOAN (QANTAS EMPIRE AIRWAYS LIMITED) BILL 1958

Second Reading

Debate resumed (vide page 759) on motion by Senator Paltridge -

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 amendment or debate.

page 786

LOAN (AUSTRALIAN NATIONAL AIRLINES COMMISSION) BILL 1958

Second Reading

Debate resumed (vide page 760) on motion by Senator Paltridge -

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 amendment or debate.

page 786

CUSTOMS TARIFF VALIDATION BILL 1958

Second Reading

Debate resumed (vide page 771), on motion by Senator Henry -

That the bill be now read a second time.

Senator McKENNA:
Leader of the Opposition · Tasmania

, - The Opposition does not oppose the passage of this measure. lt provides for the validation until June of next year of certain customs duties under various proposals that have been in the Parliament, most of them for some time, some of them as recently as the beginning of September, and Tariff proposals Nos. 7 and 8 as late as to-day.

I agree with the statement of the Minister for Customs and Excise (Senator Henty) that this is a purely machinery measure. 1 had some mild interest in looking at the nature of the matters that were covered by the various determinations. Amongst them was one that appealed to me very particularly, and I made some inquiries about it. The determination related to the substance thioglycollic acid and its salts. I think the Senate will be interested to know that I have been informed that this material, which is produced by a certain organization in Sydney, does two other extraordinary and perhaps contradictory things. It is used to put a curl into women’s hair and to put the permanent crease in men’s trousers. So it seems to be a substance that has served a very useful purpose and one which certainly should be protected against invasion from abroad. We support the bill. Mr. President.

Question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without requests or debate.

page 786

STATISTICS (ARRANGEMENTS WITH STATES) BILL 1958

Second Reading

Debate resumed from 30th September, (vide page 744), on motion by Senator Spooner -

That the bill be now read a second time.

Senator BENN:
Queensland

.- The Opposition does not oppose the bill. It may be recalled that a few years ago some State governments were collecting their own statistical information, but over the last few years the Commonwealth Government has taken over the responsibility of compiling all statistics. In view of the fact that the Opposition is not opposing the bill, 1 have nothing more to say.

Question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without amendment or debate.

page 787

ADVANCE TO THE TREASURER 1957-58

Statement of Expenditure

In committee:

Senator SPOONER:
New South WalesMinister for National Development · LP

– I move -

That the Senate approves the Statement of Heads of Expenditure and the amounts charged thereto pursuant to section 36a of the Audit Act 1901-1957.

The statement provides details of expenditure totalling £8,572,490 from an appropriation of £16,000,000 made available to the Treasurer to meet expenditure which could not be foreseen when, the Estimates were prepared. The full details of expenditure for 1957-58, which include these items, are set out in the Treasurer’s Finance Statement which has already been tabled for the information of honorable senators. As I indicated earlier, various items of expenditure were examined and reported upon by the Public Accounts Committee. I commend the resolution to honorable senators.

Senator BENN:
Queensland

.- Honorable senators may recall that when we were considering the Estimates for the vear 1957-58, it was observed that in Division No. 232 provision was made to advance to the Treasurer the sum of £16,000,000.

Yesterday, the Minister for National Development (Senator Spooner) laid on the table the Statement of Heads of Expenditure and the amounts charged thereto pursuant to section 36a of the Audit Act 1901-1957. That document discloses how the various departments of the Commonwealth have spent the money which was allotted to them. They expended £8,600,000 of the £16,000,000.

Honorable senators may also have observed quite recently when we were dealing with the Estimates for the current financial year that the sum of £16,000,000 was again made available as an Advance to the Treasurer. The document to which I have referred discloses the departments which spent the amount of £8,600,000. It may be observed, too, that that sum is more than the annual amounts that have been spent over recent years. as indicated in this table-

lt is easy to understand why the departments expended more in the last financial year than in previous years when we consider the means that are at the disposal of the Parliament to make available sufficient money to meet the costs of government. I think it is well known that there are three distinct ways of making funds available to the Government to meet the costs of the departments. The first way, of course, is by means of the Appropriation Bill that is dealt with when the Estimates are under consideration. The second way. as is now being observed, is by means of the Advance to the Treasurer. The third way is invoked if it is found that insufficient money has been provided; in the next year, Additional Estimates can be brought into the Parliament. As I have said, the document shows how the expenditure of £8,600,000 has been accounted for, and I think the requirements of the Parliament have been fully satisfied. In view of those circumstances, I have nothing more to say.

Question resolved in the affirmative.

Resolution reported; report adopted.

page 787

LOAN BILL 1958

Second Reading

Debate resumed (vide page 754).

Senator McKENNA:
Leader of the Opposition · Tasmania

.- The bill before the Senate is novel in that it authorizes, although not in express terms, the Government to raise £110.000,000 by way of central bank credit. We have not had a bill for that specific purpose in the last nine years. The bill authorizes the Treasurer. to borrow, under the provisions of the Commonwealth Inscribed Stock Act, or under the provisions of any act authorizing the issue of treasury-bills, moneys not exceeding in the whole £110,000,000. The (interesting thing is that it is required to make up the deficit in moneys required, .first, for providing the annual services of the Commonwealth and, secondly, to meet the capital expenditure of not only the Commonwealth but also the States.

It could well be argued that this central bank credit, being capital moneys, ought to be appropriated entirely for capital purposes. I believe it to be completely wrong for the Government to do what is proposed in the schedule; namely, appropriate £78,000,000 of this rather extraordinary sum against a defence expenditure of £190,000,000. It is no answer to the point that I am about to make to say that something of the kind was done by a Labour administration. I know it and admit it. I had checked upon it long before the Minister drew attention to it. Whoever may do it, I say that it is completely wrong in principle to import capital sums of this nature into the ordinary Budget instead of leaving them in loan account entirely.

The worst feature of all is that it is to be applied to an item such as defence because, by and large, the sum of £190,000,000 which, according to the Estimates, is to be expended this year will be completely unreproductive; it will be wasted. I realize that that sum includes £36,100,000 for what are termed “ capital works and services “, a good deal of which are concerned with warlike stores and munitions. It may be spent on stockpiling, but it will certainly be spent on things that are expendable and wholly unreproductive.

There would, I think, be a legitimate claim to apply about £15,000,000 out of the £190,000,000 in this way, because it is set aside for the erection of buildings and the purchase of land. They would be tangible assets which, whilst not reproductive in the hands of the Department of Defence, would unquestionably accrue in value over the years.

It is quite wrong, from a strict accounting viewpoint, to take £110,000,000 of capital money, raised by central bank credit, and apply it to an expense item such as the defence account. Moreover, it distorts and misrepresents the amount of revenue that the Commonwealth is using - passing it through to the Loan Consolidation and Investment Reserve Account, allegedly to support certain other capital works, including State capital works. I put it to the Senate that if this £78,000,000 were not brought into the Budget to reduce the expenditure of £190,000,0000 the only amount that would be available for transfer to the Loan Consolidation and Investment Reserve Account would be £24,000,000, not £102,000,000 as the Budget papers show. I hope that I have made that point clear to the Minister for National Development (Senator Spooner); if not, I shall readily amplify it. If the £78,000,000 had not been imported, the full defence expenditure of £190,000,000 would be shown. The surplus then available for transfer to the Loan Consolidation and Investment Reserve Account would be £102,000,000. less £78,000,000, which is £24,000,000.

Senator Wright:

– What is the virtue of making that transfer to the Loan Consolidation and Investment Reserve Account?

Senator McKENNA:

– It is used for capital purposes. There was on 30th June a credit of £299,000,000 in that particular account.

Senator Wright:

– Is the honorable senator suggesting that that fund was created for the purpose of hypothecating moneys for capital purposes?

Senator McKENNA:

– Unquestionably. It was created solely for that purpose. The very name, “ Loan Consolidation and Investment Reserve Account “, implies that. I go further and say that it has been used for those particular capital purposes. I am suggesting that it is a completely false presentation of accounts when £78,000,000 of central bank credit is imported into a Budget to reduce, on the face of .it, an expendable item such as defence by £78,000,000. This enables the Government to claim that it has a surplus revenue of £102,000,000 to transfer into the Loan Consolidation and Investment Reserve Account. It puts a completely false face on the position. If the Minister wishes to controvert that, he may do so. I know that he is an accountant and will doubtless appreciate my argument.

Senator Wright:

– But is not the Loan Consolidation and Investment Reserve Account merely a reserve account?

Senator McKENNA:

– The honorable senator should know that it has been used for a number of purposes. It has been used to repatriate debt. The face value of debt last year was £136,000,000. It has been used to provide subscriptions for special loans. It has been used for doing the very outrageous thing of which this Government has been the pioneer.

Senator Wright:

– In other words-

Senator McKENNA:

– The honorable senator should keep quiet and allow me to finish what 1 am saying. The revenue collected from the taxpayers of the States and the Commonwealth is passed into that fund, is invested in loans, and is then passed on to the States which, in. turn, have to meet interest and sinking fund payments on it for a period of some 53 years. I say that that is an undue burden to place upon the States. It is money that has cost the Commonwealth nothing more than the expense of collection.

Senator Wright:

– That is another point.

Senator McKENNA:

– The honorable senator says that that is not the point. It is very much the point.

Senator Wright:

– I said, “That is another point”.

Senator McKENNA:

– If the honorable senator had spoken up I might have heard him clearly.

Senator Wright:

– The honorable senator should not expect me to assume all the time that what he is saying is nonsense. I am willing to give him credit for having some sense.

Senator McKENNA:

– I assure the honorable senator that I am not trying to be smart so far as he is concerned.

Senator Wright:

– I thought you were.

Senator McKENNA:

– I was not. I simply did not hear him. One reason why I do not like this bill is that it enables the Government to put an entirely false view of the position before the people. Capital items ought to be separated entirely from a statement which shows the ordinary annually recurring expenditure of the Commonwealth. No matter who may do it, it does not give a clear and honest representation of the position. I should say with a degree of deliberation-

Senator Spooner:

– Why should the1 borrowing be on capital account ratherthan current account?

Senator McKENNA:

– For the simplereason that the borrowing is a capital item, not a revenue item. There are many reasons why capital borrowings should be applied to the discharge of capital commitments rather than to revenue expenditure. I think it high time the Federal Treasurer settled down to a basis of accounting which would show clearly just what he had left after meeting the ordinary annual services of the country. Then, quite separately, let us have a loan or capital account to show what the commitments are for defence.

Senator Wright:

– Do you say that defence expenditure is not usually debited to revenue?

Senator McKENNA:

– I am suggesting that it is, and that most of it ought to be. What I am complaining about is the taking of capital receipts like central bank credits, which is a borrowing in the same category as borrowing on the loan market, except that it is obtained easier.

Senator Wright:

– But if it is debited to the Loan Consolidation and Investment Reserve, it is only a cross entry.

Senator McKENNA:

– It is just a matter of presenting the accounts accurately and not distorting the position. If we eliminated the £28,500,000 for capital works and the £3,500,000 payment to the States, and if the £78,000,000 of central bank credit, which; is shown as a revenue receipt, were eliminated, the Budget would show a surplus of £156,000,000 of taxation available to meet capital works, and the people would know that they were being taxed to carry out works that should be financed with moneys raised on the loan market, but for the failure of the loan market.

One reason why the Treasurer confuses the accounts in this way is to conceal the fact that the people are asked to pay so much taxation to meet capital commitments. That is one of the reasons why I am objecting to what is being done under the schedule to the bill.

I am not complaining about the use of central bank credit by the Government under the circumstances. I think that maybe warranted - in a situation such as this where, I have no hesitation in saying, we have unemployment to a far greater degree than the Government admits. I would not be prepared to hazard a guess, but I submit that to the 62,000 unemployed - the figure which the Government admits - must be added all the immigrants who are awaiting placement in employment and who get what is termed special benefit, which is exactly the same as the unemployment benefit. Those immigrants are not included in the figures which the Government puts to the country. I submit that, to put the position accurately, they should be added. The figures also do not take into account the tens of thousands who are working two, three and four days a week. Further, they take no account of men who do not register for unemployment benefit, knowing that they can get no unemployment benefit when their wives are in employment. So I put it to the Minister that there is a vast area of unemployment outside the figures which the Government admits. I do not know the figure to which it would run, and i am not prepared to hazard a guess at the moment, but I have indicated three clear avenues in which there are pools of unemployed to which the Government never adverts.

Accepting the unemployment position, even on the Government’s own figures - 62,000 odd people - as serious, and knowing, as I do, that there are many others who are unemployed, I think it is completely proper to use central bank credit so far as it is necessary to get those forces back into circulation, back into employment, more especially when, at the same time, there are materials in plenty, especially for the building trades. It is only a matter of bringing the materials and labour together with the money in appropriate fields, and there is no better field for stimulus to be given in this country, and no higher social need at the moment than the field of housing and building.

It is infinitely better, of course, if money of this type can be earmarked to works of a reproductive character like many of the Commonwealth capital works and many of the capital works of the States, such as power, water and transport undertakings. It would be more suitable if they were applied there.

One of the great complaints the Opposition makes against the use of central bank credit on this occasion is that it merely enables the level of expenditure in last year’s Budget to be preserved. It is true that in certain items, such as social services, where the number of pensioners grows, there is higher expenditure. The expenditure is up by £6,000,000 because of the fact that an extra period for child endowment falls within the term. But, by and large, the use of this £110,000,000 of central bank credit merely enables the level of Government expenditure to remain where it was last year. And last year was a period in which unemployment mounted to some 75,000, an all-time peak for the nine years. It has now settled down to something like 62,000 persons officially and permanently or, I should say, steadily unemployed.

Senator Anderson:

– Not permanently.

Senator McKENNA:

– I corrected myself and said, “ steadily “. I certainly hope they will not be permanently unemployed. I have no doubt the personnel is changing from week to week, or from time to time, but there is a far more serious pool of unemployed in this country than the Government’s figures indicate. I put it very strongly that the Government has an obligation to go even further to mop up that surplus of unemployed and to get the increased resources into action. Just as the Government failed to handle what it was pleased to term prosperity but what was in fact only the intoxication of inflation, and a raging inflation at that, so, too, with an onset of depressed conditions with unemployment, materials not being used and depressed world markets, it is failing. It should now be taking its courage into its hands and, spending money through the Budget, which is a very flexible form of conditioning the economy and ensuring that moneys go where they will do the most good. Through the Budget, the Government has a selective power as to which activity should be stimulated, and I submit that the Government fell down in not making a more courageous approach to getting materials into use and men out of unemployment when a brilliant opportunity was offered to it.

In recent months, the unemployment position has improved only very slightly and it really needs the infusion of extra money, extra life in order to pick up thai lag which has persisted for far too long. After all, anybody who studies the Government’s unemployment figures knows full well that from the time of its “ little Budget “ in March, 1956, there has been one long continuous trend of rising numbers of unemployed. The one gesture which the Government made in the two other years was .in February or March of this year when it gave an extra £5,000,000 to the States. It did not put men back to work. I said at the time that all that the grant would do would be to stop more from being spilled into unemployment, and that is exactly what happened. Municipalities were authorized to raise another £3,000,000 to promote various works in their areas.

The third step which the Government took, and which was a seasonal and normal one, was to have the Commonwealth Bank release fairly large sums to the banks from special accounts to give them more liquidity.

Senator Anderson:

– About £80,000,000.

Senator McKENNA:

– The figure I had in mind was £75,000,000. Obviously the slack has not been taken up. In other words, the money has not been used in the right direction. While this proposal is acceptable in that it will prevent worse conditions developing, it lacks imagination and courage. Even though we support this measure, it does not go as far as we would like it to go in picking up the slack in the community and giving a stimulus to the whole economy.

Senator WRIGHT:
Tasmania

– The Senate has been treated to an extraordinary speech by the Leader of the Opposition in this chamber, and I presume to rise to express my views because the honorable senator’s speech defies my understanding. I should like the Minister for National Development (Senator Spooner) to correct or confirm my views. As we expected, the Opposition does not oppose the use of central bank credit to finance a Budget deficit of £110,000,000. That is truly the socialist idea, to look to central bank credit when the Government faces a deficit. While I do not criticize that outlook, it appears to me that the Treasurer is taking an adventurous step in experimenting with central bank credit by drawing on it to the extent of £110,000,000, particularly in view of the downward trend of our export markets and the price levels existing in those markets. I should appreciate the Minister’s comments on that point of view.

Senator McKenna, in presenting his second argument, gave me the impression that he was dazzling the Senate with science.

Senator McKenna:

– Not at all.

Senator WRIGHT:

– Perhaps because of my failure to understand the position, I do not appreciate any substance in this ready transfer of figures that Senator McKenna, with his accountancy experience, so readily flashes before us. This bill provides for a total expenditure of £110,000,000, redemption of war-time expenditure accounting for £34.000,000, and current defence expenditure for the remainder. The honorable senator said that the transfer of £102.000,000 to the Loan Consolidation and Investment Reserve Account is masked by the Budget provisions. A cursory glance at the Loan Consolidation and Investment Reserve Account shows that it dwindled from £377,000,000 last year to something of the order of £200,000,000 this year.

Senator McKenna:

– The figure is £299,000,000.

Senator WRIGHT:

– It is quite clear that expenditure from the account exceeded receipts, and on 1st July, 1958, the account stood at £299,000,000, the amount brought forward from 1st July, 1957, being £317,000,000.

The Loan Consolidation and Investment Reserve Account is the account into which the surpluses of preceding Budgets have been tucked away so that they will be available to meet various State expenditures. The confusion arises, not by the fact that this £110,000,000 is being treated as revenue, but by the fact that out of revenue, the surplus of which is credited to the account, we have been not only defraying the cost of Commonwealth capital works, but also meeting the deficiency in the State loan market, a deficiency which must be subsidized to allow the States to carry on their public works. The imbalance of the situation has arisen because capital raisings within the economy to meet the cost of State public works are not nearly sufficient to cope with the public works programmes.

If I am wrong in my understanding of the position I should like the Minister to correct me. I submit that the sum-total of Senator McKenna’s reference to these figures is that a few entries offset other entries in the various accounts. But they do not lead to the conclusion that a false impression is created by transferring £102,000,000 to the Loan Consolidation and Investment Reserve Account, and placing £110,000,000 into Consolidated Revenue.

Senator McKenna also stated that the chief burden upon the account results from the fact that the Commonwealth Government now feels obliged to underwrite the loan raisings of the States out of that account - which is actually out of revenue - to avoid the collapse of the State public works programmes. That impression has been created because the Commonwealth, in 1942, appropriated the whole of the public revenue of Australia with the exception of some relatively insignificant fields of taxation, and has assumed the responsibility of collecting those revenues in the form of customs, excise, sales tax, income tax and so on and, by supplementary reimbursement, has financed the States works. Then, as a corollary, the Commonwealth Government has felt obliged to finance the deficiencies of the States in respect of their public works out of its own budgetary responsibilities and not out of raisings approved by the Australian Loan Council.

An unexampled chaotic condition of public finance has been created in which no regard is paid to the real distinction between the expenditures which should fall upon the present generation and those upon the generation that will reap the benefit of the capital works on which the money is expended. Not only is that fundamental distinction ignored, but the very elementary conception of representative government is denied. It is a cardinal principle of representative government that the people have the right to hold responsible the government that levies taxes and spends the revenue. Finance is government. If a State government wishes to pursue a vigorous policy on education, it should be responsible for obtaining the finance to carry out that policy. Correspondingly, it should be conceded sources of taxation that would enable it to raise the revenue necessary to finance that policy. This procedure stems from the period when Senator McKenna’s party was in power. That neither condemns nor excuses it, but it has followed its confused course, gradually getting worse as the years have gone by, since 1949.

One obvious inference from Senator McKenna’s remarks is that we will not get responsible government in relation to finance until we sort out the responsibility for raising finance between the States and the Commonwealth, giving each side its own province, first, in sources of taxation available, and secondly, in responsibility for expenditure. The people who elect a State government should be able to hold that government accountable for levying taxes to meet the expenditure of money on a particular policy, and the people who elect a Federal government should be able to know that the money that is being raised by it will be used to finance its own policy. At the present time, the Federal government excuses this extortionate Budget on the ground that it has to finance the States. In the present unresolved and confused position, it has to shoulder that responsibility, and clarification of the position is one of the most urgent needs in Australia to-day.

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

– I do not disagree with the main burden of Senator Wright’s argument, but I think that, side by side with it, there should be presented a picture of the situation that causes the Commonwealth Government to continue along this track. Firstly, without doubt Australia is passing through the greatest period of progress and development in its history. I shall not try to establish that, because I think it is accepted by all. It would not have been possible to make that progress unless the States had been supplied with adequate financial resources. Surely we are not going to pause or do anything that will arrest that progress. We are confronted with a set of circumstances in which there are opposing political forces and opposing political ideas. From any point of view, those circumstances present a very difficult and intricate problem. I think that

Senator Wright’s argument should be accompanied by what I might call a rider to the effect that the States’ needs have to be provided for and that, in the present circumstances, the present system provides the only available solution.

The purpose of the bill that is being debated is to give the Commonwealth Government ‘authority to borrow £110,000,000 from the Commonwealth Bank on treasurybills. The Leader of the Opposition said that he did not complain about the Government adopting the procedure of using central bank credit, and that his party would support the bill. With respect, that is the whole substance of the matter. Both political parties approve and support the procedure and the principle laid down in the bill, but, politics being politics, the Leader of the Opposition then proceeded to fry to take a few tricks.

Senator Wright:

– How does the sum of £1 10,000,000 compare with previous annual drawings of central bank credit?

Senator SPOONER:

– I should not like to answer that question offhand, beyond saying that I expect that we have drawn on central bank credit since we have been in power, but never for an amount of anything of this order. I have some reservations in saying that we have drawn on central bank credit previously. Of course, this is an historic Budget from the point of view of the use of central bank credit.

Even though the Leader of the Opposition was supporting the bill, he complained about the technicalities of the Government’s approach to the matter. Again, I shall deal with the substance of the matter rather than with the form. The purpose of the appropriation of this amount for defence purposes is, of course, to put the position beyond all doubt from a constitutional point of view. Whatever doubts there may be about certain aspects Of the Constitution, it can never be doubted that ‘the Commonwealth has a complete right to use the defence power. The money must be appropriated under some heading, and from a legal point of view the soundest policy is to appropriate it under the heading of defence.

Senator McKenna:

– I merely suggest it might be far more appropriate if it were - applied to capital works and services.

Senator SPOONER:

– I do not know. Let me deal with the point that if we appropriate the money under the heading of defence we are putting it to revenue rather than to capital services. In reply to Senator McKenna, I say that if that is his argument, he should be a purist, carry his argument right through and claim that all these items of capital expenditure in the Budget should be deleted and put under capital works and services. But the honorable senator and I both know that many items which in normal commercial accounts we should capitalize are, in Government accounting, taken as being on the income and expenditure side.

Senator McKenna:

– It is quite wrong.

Senator SPOONER:

– The next point I make in reply to Senator McKenna is that, on his own admission, this is a procedure adopted by his government when it was in power.

The only ‘flung to which I take exception is the statement by Senator McKenna that there is an air of concealment about this. I do not think that statement is in accordance with his usual form.

Senator McKenna:

– I thought I used the word “ confusion “. Did I say “ concealment “?

Senator SPOONER:

– You used the word “ concealment “.

Senator McKenna:

– I do not withdraw it.

Senator SPOONER:

– My reply is that, in view of the method of presenting Budget papers to -the Parliament - to the Senate in particular - there is no -chance of successfully concealing any large amounts. It is plain for all to see. Even if we do not rise to the occasion and comment upon a certain item, it must pass the Auditor-General and the -Public Accounts Committee and I have no doubt that, if any criticism can be levelled at the way in which a transaction is presented, ‘either the Auditor-General or the Public Accounts Committee will offer that critcism.

I cannot accept the view that there i< any ‘great difference between taking an amount in reduction of defence expenditure, in reduction of expenditure on Capital Works and Services or in reduction of some other item, because the more I see of government accounts the more T am convinced that in the final analysis the only way in which one can approach them is to do so on a cash basis, having on one side all the receipts from revenue and borrowings and, on the other side, expenditure. It is the cash deficiency at the end that is the pertinent figure.

I do not propose to speak at length in reply to criticism of the unemployment situation. I repeat what I have said previously, that is, that all the facts and information that we have and which we can fairly interpret show that the level of employment in Australia is higher than that of any other country.

Question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without amendment or debate.

page 794

CHRISTMAS ISLAND AGREEMENT BILL 1958

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator O’Sullivan) read a first time.

Second Reading

Senator O’SULLIVAN:
Vice-President of the Executive Council and Attorney-General · Queensland · LP

– I move -

That the bill be now read a second time.

The purpose of this bill is to approve the execution of an agreement between the Government of Australia and the Government of New Zealand in relation to the rights which are jointly held by them in respect of the phosphate deposits on Christmas Island. The text of the agreement is given as a schedule to the bill.

The new agreement replaces one made in 1949, when the Australian and New Zealand Governments first acquired exclusive rights to phosphate and other minerals on Christmas Island. The need for a new agreement arises from the transfer of sovereignty over Christmas Island from the United Kingdom to Australia. The new agreement comes into effect on the date of transfer.

The Christmas Island Phosphate Commission, established under the original agreement, will function under the new agreement without change, and the produc tion and distribution of the phosphate will continue as in the past. One new feature of the agreement is a provision for payment to the commission of 8s. sterling per ton of phosphate exported. The proceeds will be used, first, to reimburse the two governments for the costs incurred in connexion with the transfer of the island to Australian control. The principal item in this connexion is the ex gratia payment of approximately £2,800,000 to the Singapore Government to compensate it for the loss of revenue from royalties and rent, which were applied to Singapore when the island was a British colony. After this charge has been met, the payments will be used to build up a fund to help meet the responsibilities of the Australian Government in respect of the inhabitants of the island who may remain on the island after the phosphate deposits have been exhausted in some 40 years time. Details of this proposal are given in Article VI. of the agreement.

May I also direct attention to Article IX. of the agreement, which provides that the cost of administration of Christmas Island will be met from the proceeds of the sale of phosphate? This provision follows the pattern that has long operated at Nauru. It is also in keeping with the arrangements followed during the interim period of United Kingdom control from 1st January to 30th September, 1958. The article makes it clear that any works which go beyond the reasonable requirements of the Administration of Christmas Island - for example, an aerodrome of larger extent than that required for administrative purposes - will not be financed in this way as a charge on phosphate, but by other means.

The effect of these provisions is expected to mean an increase on each ton of phosphate exported from Christmas Island of not more than1s. 6d. per ton f.o.b. compared with the cost before the transfer. The effect on the price of superphosphate paid by the Australian or New Zealand user is expected to be about 3d. per ton, for phosphate from different sources is pooled for the purposes of manufacture in Australia and, of course, the ton of phosphate is only one element in the ton of superphosphate.

In conclusion, I should like to express on behalf of the Australian Government our appreciation of the co-operation of the New Zealand Government in the negotiation of this agreement. We believe, as it does, that the transfer of sovereignty is in the best interests of both countries and that the agreement concluded between us regarding future operations on the island protects the interests of both countries and will contribute to the good government of this new Australian territory and the advancement of its welfare.

Senator TANGNEY:
Western Australia

– The Opposition does not oppose the bill. As a matter of fact, we on this side welcome it. As one who has had an opportunity to see at first hand the work of a similar undertaking on the island of Nauru, I feel that nothing but good can come from the agreement. It is of particular importance to us in Western Australia that the phosphate deposits on Christmas Island be fully utilized. If the Christmas Island Phosphate Commission discharges its responsibilities to the natives of the island in the same way as similar responsibilities have been discharged on the island of Nauru we shall have no complaint, because at Nauru the rights of the native people are well guarded. If, as is stated in the agreement under consideration, similar conditions obtain at Christmas Island, there will be nothing with which we can disagree.

The work that has been done by the Phosphate Commission, and the close liaison that has existed between the Governments of England, Australia and New Zealand, have been excellent. The entry of phosphate ships into the harbours of Western Australia has become a familiar sight. The only matter about which we are a little worried is that there will be a slight increase in the price of superphosphate supplied to the farmer, but as that will be negligible compared with the benefits to be conferred, not only upon the people of Christmas Island, but upon the industry as a whole, we offer no opposition to the measure.

Question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without amendment or debate.

page 795

ADJOURNMENT

The PRESIDENT:

– Order! In conformity with the sessional order relating to the adjournment of the Senate, I formally put the question -

That the Senate do now adjourn.

Question resolved in the negative.

page 795

DAIRY PRODUCE RESEARCH AND SALES PROMOTION BILL 1958

Bill received from the House of Representatives.

Standing Orders suspended.

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

Second Reading

Senator PALTRIDGE:
Minister for Shipping and Transport and Minister for Civil Aviation · Western Australia · LP

[11.11. - 1 move -

Thai the bill be now read a second time.

The purpose of this bill is to give effect to a request from the dairy industry for legislation to provide for a sales promotion campaign for butter and cheese in Australia, and also for research into the many problems of this major primary industry. Some months ago, the Australian Dairy Industry Council, which comprises the major dairying bodies of the Commonwealth, that is, the Australian Dairy Farmers Federation, the Commonwealth Dairy Produce Equalization Committee Limited, and the Australian Dairy Produce Board, informed the Minister for Primary Industry that the council had approved the principle of a levy on the production of butter and cheese for the purposes of financing plans for sales promotion in Australia, and for research.

The Minister was glad to receive a recommendation for such a scheme, as this is the fourth major primary industry which has agreed to a plan to finance research into its problems. The other industries that have already taken this important step are wool, wheat and tobacco. The bill which is now before you is the outcome of negotiations that have been going on for some time. Dairy industry organizations, through the Australian Dairy Industry Council, and the Commonwealth and the States, through the Australian Agricultural Council, have all been involved. The proposals that have received the approval of all interested parties have been provided for in the bill.

A statutory levy will be imposed on all butter and cheese manufactured in Australia. The maximum rates of levy will be 3/16d. per lb. on butter and 3/32d. per lb. on cheese. The operative rates will be prescribed by regulation on the recommendation of the Australian Dairy Produce Board, but for the first year the rates will be id. and red. per lb. on butter and cheese respectively. On an annual production of 200,000 tons of butter and 40,000 tons of cheese, a levy at these rates- would yield about £250,000 a year. The board will recommend the proportions of these rates that are to be prescribed for the purposes of research and promotion respectively.

A promotion and research scheme will be administered by a special committee of the Australian Dairy Produce Board. A special member with suitable qualifications will be appointed to the board for the purpose of co-ordinating all aspects of the sales promotion and research programmes. The board will have authority to co-opt persons outside the board to form ad hoc advisory -sub-committees.

As a result of a request from the Australian Agricultural Council, the industry agreed to increase the membership of the special committee by including one representative of the Australian Agricultural Council and one representative of the Department of Primary Industry. One representative of the Commonwealth Scientific and Industrial Research Organization was also added to the special committee. I consider this decision a wise one, as it will undoubtedly achieve greater coordination and broaden the outlook of the committee, and yet not enlarge the committee to the extent where it will become unwieldy or ineffective.

The Commonwealth has agreed to contribute one-half of the costs incurred on projects included in the programme of research that are endorsed by the board and approved by the Minster, with a maximum contribution of £1 for £1 against funds raised by way of levy that are allocated to and used for research. The sales promotion proposals will be financed by the industry itself without any assistance from, the Government. The administrative aspects of the proposals; are worthy of some special attention. As mentioned previously, the scheme will be administered by a special, committee of the Australian Dairy Produce Board. This committee will comprise nine members, including the chairman of the Dairy Produce Board, three producers? representatives on the board, a special, member to be appointed to the board and one representative on the board of co-operative and proprietary butter and cheese factories who will be appointed by the Minister on the nomination of the board.

Also on the special committee will be one representative each of the Australian Agricultural Council, the Department of Primary Industry and the C.S.I.R.O., who will have full voting rights in the committee in relation to matters associated with the research programme, including the apportionment of the levy between promotion and research. It is considered essential that production, research, extension, marketing and promotion should be integrated. All of these fields will be adequately represented, but it will be the job of the special member, who will be responsible directly to the board, for the detailed administration of the research/promotion programmes and the integration with them of existing work in these fields.

The dairy industry to-day is facing many difficult problems. The traditional export market, the United Kingdom, is oversupplied with butter, and current export prices return, much less than cost of production. In addition, the long term export outlook is anything but bright. In the circumstances, it is evident that the industry’s willingness to provide finance for research and promotion activities strongly reflects the dairy-farmer’s anxiety for the future and the earnest desire to increase efficiency, to reduce costs and to increase the sale of dairy produce on the domestic market.

I would like to remind honorable senators of the assistance afforded the dairy industry by the Commonwealth. In the way of subsidy alone, the butter and cheese industry has received something over £138,000,000 since this Government assumed office in 1949. Our policy of stabilizing this industry is continuing, and for the 1958-59 season we have again made provision for £13,500,000 by way of subsidy. In addition, the Government has decided to give additional support to dairy-farmers, following a period of low incomes due mainly to the recent drought, the fall in London prices and other causes.

The Government is prepared to underwrite a return in total production of butter and cheese for the 1958-59 season, which will enable the average butter factory to pay producers 40d. per lb. commercial butter basis when the equalization pool is being finalized. The current average interim payment for the 1958-59 season is only 37d. per pound. This decision, therefore, will assure producers a final return of at least 3d. per lb. over the present interim return of 37d. per lb. The guarantee has a potential liability for the Commonwealth and is, of course, additional to the Commonwealth Government subsidy to the dairying industry of £13,500,000 for 1958-59.

The assurance means that the dairy farmer will get a minimum return on his total production, whether sold for domestic consumption or for export. The five years’ stabilization plan does not, of course, cover total production. Subject to both parties accepting a calculated risk after subsidy is determined, it applies to domestic consumption of butter and cheese, plus a quantity equal to 20 per cent, of that consumption. This year it is estimated that the production of butter will be about 200.000 tons, while domestic consumption will probably be 115,000 tons. Thus, the quantity covered under the stabilization plan is about 138,000 tons, whereas the quantity covered by the 40d. per lb. guarantee for this year will be total production estimated to be about 200,000 tons.

For the remaining period of the present five-year stabilization scheme the Government will be prepared to consider applying the same principle of underwriting a final equalized return at levels determined by it each year after examination of all relevant factors. The Government recognizes that the guarantee offered to the industry is only a short-term measure to assist dairy-farmers during a critical period. The fundamental problems of the industry - high cost production, land development problems, competition from substitutes and depressed overseas prices - must be tackled largely by the industry itself. The Australian Agricultural Council, at it meeting on 9th and 10th

October, will give consideration to proposals for remedying them.

The dairy industry has obtained considerable benefit from the Commonwealth dairy industry extension grant of £250,000 per annum which is used to strengthen the State extension services to the industry. This grant, which the Government recently decided to continue for a further five years to 30th June, 1963, and which is now in its eleventh year of operation, is intended to promote improved methods on dairy farms with the aim of increasing production efficiently and reducing costs.

Whilst on the subject of finance, I would like to mention the Commonwealth Bank guarantee to the Australian Dairy Produce Board which, in recent years, has been to the value of approximately £40,000,000 annually and is important in giving the farmer almost immediate payment for his butter and cheese exported.

Other services made available by the Government include the inspection service provided by fully qualified Commonwealth butter and cheese graders, which ensures at the point of export a consistency and uniformity in quality within each grade which is highly regarded in overseas countries. There is also the Trade Commissioner Service operating from 28 posts throughout the world, which is continually examining every possibility for extending our dairy produce market opportunities overseas.

Trade publicity is conducted through the Overseas Trade Publicity Committee and is now in its fourth post-war year of operation. The Overseas Trade Publicity Committee is comprised of the chairman of the statutory marketing boards and representatives of the Departments of Trade and Primary Industry. Finance provided by the marketing boards is augmented by a considerably more than proportionate amount provided by the Government. During the 1957-58 season, for instance, the Government provided £330,000 against £123,000 contributed by the boards. The overseas publicity campaign, I am pleased to say, has now developed to a stage where it has been accepted and fully supported by all trade channels in the United Kingdom including importers, wholesalers and retailers.

The Australian Dairy Produce Board has been a keen contributor to overseas publicity funds, and much work has gone into the sales promotion of Australian butter and cheese in the United Kingdom. In addition, the Australian Dairy Produce Board contributes to the Butter Information Council £1 sterling on every ton of butter exported to the United Kingdom. The other traditional exporting countries and the United Kingdom Milk Marketing Board also contribute on a similar scale.

Finally, I would like to say a word concerning contributions for research and extension work by the industry itself to the Commonwealth Scientific and Industrial Research Organization, the universities and other authorities. The Australian Dairy Produce Board, in the last decade, has contributed nearly £250,000 towards the cost of this work. Recognizing that the expansion and increased efficiency of animal production are objectives of prime importance to Australia in ensuring a continued position in world markets, the dairying, meat and wool interests each contributed £50,000 towards the purchase and establishment of a property at Camden, near Sydney. The property was handed over to the University of Sydney in 1954 as a national veterinary education centre and also for research into farming and animal husbandry.

It can be seen that the industry, with Government assistance, has already made considerable progress in fostering research into industry problems. That the intensification of sales promotion and the expansion of research are considered worth while by the industry is reflected in the dairy industry’s most recent request, which is being given effect in the bill before the Senate. I consider that this is one of the most important steps ever taken by the dairy industry towards its own advancement. 1 commend the bill to honorable senators.

Senator COOKE:
Western Australia

.- I move-

That the debate be adjourned.

I understand that this bill is the principal one of three measures that we are to consider in relation to the dairying industry. I suggest that it will suit the convenience of the Senate if the second-reading debate on one of the measures covers the other two measures. They can be considered separately in committee.

Senator Paltridge:

-I am agreeable to the adoption of that course.

The PRESIDENT:

– That procedure will be followed.

Question resolved in the affirmative.

Debate adjourned.

page 798

DAIRY PRODUCE LEVY BILL 1958

Bill received from the House of Representatives.

Standing Orders suspended.

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

Second Reading

Senator PALTRIDGE:
Minister for Shipping and Transport and Minister for Civil Aviation · Western Australia · LP

– I move -

That the bill be now read a second time.

The purpose of this bill is to impose a levy on the production of butter and cheese and to provide for the administrative machinery for the collection of the levy by the Department of Primary Industry. As I mentioned in my second-reading speech on the Dairy Produce Research and Sales Promotion Bill, the Government has been requested by the Australian Dairy Industry Council to impose a levy on the manufacture of butter and cheese for the purpose of financing a research and sales promotion scheme for the dairy industry. Honorable senators will note that the actual rates of levy to be imposed will be prescribed by regulation after recommendation to the Minister by the Australian Dairy Produce Board, but there is provision in the legislation that the prescribed rates must not exceed threesixteenths of a penny per pound on butter and three-thirty-seconds of a penny per pound on cheese. I commend the bill for the favorable consideration of the Senate as a necessary supplement to the Dairy Research and Sales Promotion Bill.

Debate (on motion by Senator Cooke) adjourned.

page 798

DAIRY PRODUCE EXPORT CONTROL BILL 1958

Bill received from the House of Representatives.

Standing Orders suspended.

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

Second Reading

Senator PALTRIDGE:
Minister for Shipping and Transport and Minister for Civil Aviation · Western Australia · LP

– 1 move -

That the bill be now read a second time.

The purpose of this bill is to make certain amendments to the Dairy Produce Export Control Act 1924-1954 which are consequential upon the Dairy Produce Research and Sales Promotion Bill 1958. In my second-reading speech on that bill, 1 explained the role which the Australian Dairy Produce Board will play in the new research and promotion scheme for dairy produce. The amendment of the principal act under which the board is constituted is necessary to enable it to engage in these activities and also to make provision for the appointment to the board1 of a special member who will be responsible to that authority for the general administration of the scheme.

Opportunity has also been taken to make certain other amendments of an administrative nature only to the principal act. I commend the bill to honorable senators.

Senator COOKE:
Western Australia

– If the Senate has no objection I propose to refer to all three of the important measures which the Government has brought down in regard to the dairying industry.

The PRESIDENT:

– The honorable senator is granted leave to refer to all three bills.

Senator COOKE:

– We raise no objection to the measures. We feel that their introduction is commendable. For years dairyfarming, and the marketing of dairy products, have not been in a very happy state. The bill holds out some hope for the future. Indeed, it may be productive of much good in the matter of marketing and research. It is certainly an advance on what we have had hitherto.

I should like to refer to a few matters that should receive the attention of the Government and the Parliament. We have adequate marketing arrangements for the products of the dairying industry. From time to time, boards are set up to carry out particular functions. However necessary they may be, the cost of maintaining them is a charge on industry, on production and on the consumer. The establishment of boards, and the conducting of research may be necessary and admirable but eventually we arrive at the stage when we should do some streamlining and reduce costs of this kind to an absolute minimum. After all, the cost must eventually be borne by the Australian consumer, who is often not getting commodities at a price comparable with the world parity price. To the extent that that is necessary, it must be suffered.

The most important factor in this matter of marketing primary produce is cost of production. In moving the second reading of the main bill, the Dairy Produce Research and Sales Promotion Bill, the Minister for Shipping and Transport and Minister for Civil Aviation (Senator Paltridge) told us that the fundamental problems of the industry were the high cost of production, land development problems, competition from substitutes and depressed overseas prices, which must be tackled by the industry itself. That is very true. However, we must never forget that the blame for at least three of these fundamental problems can be laid at the door of the Government, which permitted inflation to force production costs to a level which made it impossible to compete on world markets. That is, of course, a serious business. Such a state of affairs is usually not referred to except in a debate of this character where the price at which one can produce, and the price at which one can sell become the allimportant factors.

It is rare indeed to hear the Government say that the farmer must aim at production efficiency and reduced costs. The dairyfarmer cannot reduce costs. He works very long hours, and he cannot reduce the cost of employing a farm assistant. The fundamental cost of looking after cows and so on cannot be reduced. The dairy-farmer has to contend with high interest rates, repayment of advances, and inflated costs of services. He can do very little to control costs such as these.

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

– He has to meet interest charges on hire purchase.

Senator COOKE:

– That is so. The Minister says that it is up to the dairying industry to meet these fundamental problems. It is all very well to speak of reducing costs, but if one attempts to pin-point the costs of the dairy-farmer, or even of the dairy factory, one finds it difficult to show just where costs can be reduced. When the Federal Treasurer is asked to provide a more liberal Budget he tellsus that there is certain expenditure which cannot be reduced.

On the consumer side one finds egg boards, dairying boards, onion boards, sales promotion boards and so on. They all cost something. The relevant figure for this industry is in the vicinity of £1,250,000. It all finds its way into the price which must be paid by the housewife and the worker in industry. There should be a leavening of those costs. The Government, in thinking of the position of the dairyfarmer, must also think of the producer in the factory and also the third party - who is usually lamentably forgotten - the householder. The Minister will tell us that a lot of money has been spent doing this and that, but I am afraid that will offer little solace to the consumer.

Another great challenge to the industry was mentioned by the Minister. I refer to substitutes. They are ‘finding their way on to the Australian market only because the housewife cannot afford to buy butter and the like. She must often buymargarine. It is a matternot of choice ‘but of economic necessity. Therefore, when we talk about butter production and the promotion of sales we must not forget that a proportion of any subsidy should be devoted to keeping down the home price. A woman who cannot afford milk uses skimmed milk; a woman who cannot afford butter uses margarine; and a woman who cannot afford first-grade buys second-grade butter.

The points which I have made should be noted by the Government. The legislation is commendable. It certainly meets with the approval of people in the industry. However, an aspect which has received insufficient attention is the price to the consumer - the old stalwart without whose help no industry could flourish. He works to produce a product and* then spends his wages on products produced by other people.If the Government has money to spend on subsidies it should allocate a reasonable proportion of it to supporting the home price. The householder would then buy butter instead of margarine and whole milk instead of skimmed milk. No one would then have any complaint. I make that suggestion as an alternative to sales promotion.

Question resolved in the affirmative..

Bill read a second time.

In committee:

The TEMPORARY CHAIRMAN (Senator Pearson:
SOUTH AUSTRALIA

– Is it the wish of the committee that the bill be considered as a whole?

Senator Wright:

– I should like to discuss clause 6 (1.), which relates to rates of levy on butter.

The TEMPORARY CHAIRMAN:

– We are dealing not with the bill to impose a levy, but with the Dairy Produce Export Control Bill.

Senator Wright:

– I regret it if I have caused the committee any inconvenience. The bill which I wish to be taken clause by clause is the Dairy Produce Levy Bill 1958.

The bill.

Bill agreed to.

Bill reported without amendment; report adopted.

Bill read a third time.

page 800

DAIRY PRODUCE RESEARCH AND SALES PROMOTION BILL 1958

Second Reading

Debate resumed (vide page 798), on motion by Senator Paltridge -

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 amendment or debate.

page 800

DAIRY PRODUCE LEVY BILL 1958

Second ‘Reading.

Debate resumed (vide page 798), on motion by Senator Paltridge–

That the bill be now read a second time.

Question resolved in the affirmative.

Bill read a second time.

In committee:

Clauses 1 to 3 agreed to.

Clause 4 (Act applies to States).

Senator WRIGHT:
Tasmania

.- I realize that it is desirable to have expressed functions, and I should like to know what the object of this clause is. What State enterprises are expected to be levied upon?

Senator PALTRIDGE:
Minister for Shipping and Transport and Minister for Civil Aviation · Western Australia · LP

– I am informed that the States conduct agricultural colleges which receive bounty and which are required to pay taxes. The Commonwealth conducts no such institutions.

Senator WRIGHT:
Tasmania

.- If that is the explanation, then it is somewhat surprising. If it is a question of agricultural colleges, I do not suppose there is very much in it, and I content myself with expressing my dissatisfaction mildly.

Clause agreed to.

Clause 5 agreed to.

Clause 6 (Rates of levy on butter).

Senator WRIGHT:
Tasmania

– Will the Minister explain to me the difference between paragraph (a) and paragraph (b) of sub-clause (1.)?

Senator PALTRIDGE:
Minister for Shipping and Transport and Minister for Civil Aviation · Western Australia · LP

– I am informed that there is no difference in form. Paragraph (a) refers to the rate to be fixed for dairy produce research, and paragraph (b) to the rate to be fixed for sales promotion.

Senator WRIGHT:
Tasmania

– Is that expressed anywhere in the bill? It will come up in connexion with subsequent provisions, but I do not see it, and I should like to see the express direction in the bill.

Senator Paltridge:

– It is referred to in clauses 17 and 18 of the Dairy Produce Research and Sales Promotion Bill 1958.

Clause agreed to.

Clauses 7 and 8 agreed to.

Clause 9 (Exemption from levy).

Senator WRIGHT:
Tasmania

– This is one of those arbitrary powers reserved by a Minister and objectionable to any person who has the slightest respect for parliamentary procedures and the Constitution. It is the sort of thing for which people, 300 years ago, ought to have been, and were, beheaded. Sub-clause (1.) reads -

The Minister may, from time to time, by notice published in the Gazette, after report to the Minister by the Board, exempt any dairy produce from the levy.

That is the general power to exempt any produce from the levy. What is intended? With an exempting power of this kind reserved to’ the Minister, the executive will have an overriding power to shoot holes in a taxing measure imposed by the Parliament. I direct the Minister’s notice to sub-clause (2.) in which, in a classically Canberran fashion, we ensure that our irresponsibility shall be complete. The sub-clause reads -

An exemption under the last preceding subsection may be unconditional or subject to such conditions as are specified in the notice.

A regulation is not necessary to allow exemption. By specifying conditions in a notice, an exemption from Parliament’s will to impose a levy is granted.

Senator PALTRIDGE:
Minister for Shipping and Transport and Minister for Civil Aviation · Western Australia · LP

– The intention of this bill is that factories shall be taxed. Sometimes farmers make butter for their own consumption. That is the kind of case covered by clause 6.

Senator WRIGHT:
Tasmania

– If that is the purpose of the clause, with all the goodwill in the world it should be rejected out of hand. If the intention is to exempt specific classes of persons - those who manufacture less than a certain amount each year - that intention should be specified as in the income tax and other taxing legislation. If Farmer Dick who does not have an exemption is to be required to furnish returns to the Minister I think, even at this late hour of the night, we should give this clause further consideration. The bill could provide for a levy on factories which manufacture butter, but surely the ordinary dairyfarmer who manufactures 10 lb. of butter for his own consumption is not required, under pain of penalty, to pay a levy unless he obtains from the Minister an exemption notified in the Government “ Gazette “.

The Minister for Customs and Excise (Senator Henty) will remember that we welded our . spirits more closely together when discussing this very principle in relation to the diesel fuel tax legislation. The farmers have enough to do now without being required to devote time to completing forms simply to please a draftsman in Canberra.

The TEMPORARY CHAIRMAN (Senator Pearson:

– Are there any requests?

Senator WRIGHT:
Tasmania

.- I am seeking information and, in default of an answer from the Minister, I rise again in my place. When 1 agreed to the inclusion of the word -i manufacturer “ in clause 8 I never dreamed that every farmer who manufactures dairy produce would be required to furnish returns and pay this levy. A specific exemption should be written into the bill to the effect that all producers, other than dairy produce factories, shall be exempt. I am seeking information from the Minister.

Senator PALTRIDGE:
Minister for Shipping and Transport and Minister for Civil Aviation · Western Australia · LP

– As I endeavoured to explain previously, this measure is intended to apply to butter factories, not to the small farmer who, for his own use, makes butter on his farm. By the application of this exemption, the farmer is not required to furnish the returns.

Senator WRIGHT:
Tasmania

.- Even at this late hour a little clarity on the matter is necessary. To achieve the purpose mentioned by the Minister, we would need only to write into the bill that there shall be an exemption from the levy of dairyfarmers who manufacture dairy produce or whose manufacture of dairy produce does not exceed 200 lb. a year, or whatever the figure may be. I live in a district which includes 20 dairy farms. As I read the proposal, those dairy-farmers who have not received an exemption, notice of which is published in the “ Gazette “ after report to the Minister by the board, are subject to payment of the levy. Dairy produce includes cheese and butter. Is it intended to exempt all dairy produce? Will the Minister have power to exempt any farmer who produces less than, say, 200 lb. of dairy produce a year?

Senator PALTRIDGE:
Minister for Shipping and Transport and Minister for Civil Aviation · Western Australia · LP

– I do not wish, to be rude to Senator Wright, but 1 cannot add anything to the estimation I have already given.

Clause agreed to.

Clause 10 agreed to.

Clause 1 1 (Recovery of levy).

Senator WRIGHT:
Tasmania

– Hidden away in clause 11 is sub-clause (2.) which reads -

In proceedings for the recovery of an amount of levy, a statement or averment in the complaint, claim or declaration of the plaintiff is evidence of the matter so stated or averred

What is the reason for that reversal of the ordinary approach? I was tempted to say “ reversal of form “ but I recalled that I am in Canberra. When a similar proposal was made in regard to the Communist party, deep-rooted objection was taken. This clause relates to a dairy-farmer or a dairy manufacturer. Other taxing legislation does not include provisions to the effect that an averment of the plaintiff shall be evidence of the matter stated. Will the Minister advise me on this point?

Senator Paltridge:

– I am advised that this provision is similar to those included in other taxing legislation, and follows the form adopted in such measures.

Senator WRIGHT:

– Will the Minister go a little further in. this instance and specify the taxing legislation to which he refers? I should like to challenge him on, for example, the income tax legislation. Responsible officers are appointed and given the power to make arbitrary assessments of the tax we are to pay, but the matter contained in their complaints is not taken as proof, merely upon their ipse dixit.

Clause agreed to.

Clause 12 (Regulations).

Senator WRIGHT:
Tasmania

.- The clause states -

The Governor-General may make regulations . . and, in particular -

requiring persons to furnish returns for the purposes of this Act; and

The clause requires “ persons “ to furnish returns. It is not confined to dairy produce manufacturers, to whom it would be sufficiently inconvenient and obnoxious.

Why not confine the requirement to persons who are liable to pay the levy?

Senator PALTRIDGE:
Minister for Shipping and Transport and Minister for Civil Aviation · Western Australia · LP

– I am advised that the answer to Senator Wright’s query is that no one other than a person producing dairy produce will, in fact, be required to furnish a return.

Senator WRIGHT:
Tasmania

.- The tentacles of taxation have become most searching. Under the Income Tax Act it is possible for an officer, without warrant or notice of any sort, to go to a person’s banker, solicitor or other confidential agent and require him to breach his confidence. The same thing might occur under this legislation, although we are dealing only with an impost not exceeding threesixteenths of a penny on a pound of butter. I do not suppose there is much in the point I am making, but, still, we should scrutinize these clauses to show that these things are not being put over us unnoticed, even though they are being put over us.

Clause agreed to.

Title agreed to.

Bill reported without requests; report adopted.

Bill read a third time.

page 803

COPPER BOUNTY BILL 1958

Bill received from the House of Representatives.

Standing Orders suspended.

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

Second Reading

Senator HENTY:
Minister for Customs and Excise · Tasmania · LP

– T move -

That the bill be now read a second time.

The purpose of the bill is to authorize payment of bounty at a maximum rate of £45 a ton on refined copper produced in Australia and sold, during the period from 19th May, 1958, to 30th June, 1960, for use in Australia. Following a Tariff Board report of 15th October, 1954, and an examination of the copper industry by an inter-departmental committee, a further reference was made to the Tariff Board in March, 1957, as to whether assistance should be afforded the production in Australia of copper and, if so, the nature and extent of the assistance required to ensure continuity of operation by the major . producers.

In a report tabled last session, the Tariff Board recommended a sliding scale duty (varying inversely with changes in world copper prices) designed to stabilize the Australian price at a minimum of £330 a ton of refined copper. The Australian price was then £330 a ton, whilst the world price was £220 a ton. The Government has accepted the board’s view that assistance to the copper industry is justified. In doing so, the Government had in mind the economic and social consequences likely to flow from a closure of any of the major mines. The Government has also accepted the board’s view that a return of £330 a ton of copper sold locally was required to keep the major producers in active operation for the time being.

The Government did not, however, accept the view that the tariff was the most appropriate or the only effective method of assisting the major producers. Indeed, the Government was concerned at the implications for the Australian economy of a difference of £110 a ton between the Australian and world prices of such a basic raw material as copper. Accordingly the decision was made to assist the industry partly by the tariff and partly by bounty. By these means the gap between the Australian and the overseas price has been narrowed, leading to a considerable saving to the economy generally. At the same time the mines on which several isolated communities depend will be assured of reasonable returns. The lowering of the Australian price should also favorably influence the local demand for copper.

Provision has been made in the tariff for the admission free of duty of blocks, ingots and pigs of copper when the determined price of copper based on the weekly average of the London Metal Exchange quotations is the equivalent of £275 (Australian) or more per ton. When, however, the determined price of copper is less than £275 a ton, duty becomes payable at the rate of £1 a ton for each £1 by which the determined price falls below £275 a ton. Under the bill, the tariff protection will be supplemented by a bounty to the mines in need of assistance of £45 a ton on sales of refined’ copper on the. domestic market. Should however, the overseas price for copper advance above £275 (Australian), the Australian price will rise and the bounty will fall to the same extent.

The bounty will be paid to the mines producing the copper. Provision will be made in the regulations which will enable smelters to make application for bounty on behalf of small producers. This will mean that small producers will be paid the bounty at the same time as they receive the final proceeds from the sale of their ore. For this purpose small producers will be regarded as mines producing up to 50 tons of refined copper in any one year. Bounty has been made payable on the refined copper content of the ore and at the date of sale for the reason that the eligibility of the copper for bounty can be more easily and definitely demonstrated at those points.

Provision has been made for the retrospective payment of bounty on sales effected as from 19th May, 1958, which is the first convenient date after the announcement of the bounty proposal and the imposition of the new duties on copper. This is also the date on which the price of copper in the Australian market was reduced from its previous level of £330 a ton. The customary profit limitation of 10 per cent, per annum on the capital used will be applied to the major producers. It has, however, become apparent that the nature of the operations and the meagre records kept by small producers did not lend themselves to an equitable capital and profit calculation. For those reasons they have been excluded from the profit limitation provisions.

Consideration has also been given to the share of the local market likely to be enjoyed by the producers subject to bounty. It was not so long ago when we had to import some copper to meet our requirements in full. To-day the spectacular advance in copper production has reversed the situation and an increasingly large proportion of the production has to find an outlet on the export market. It has been customary for members of the Copper Producers Association to meet together and amicably resolve a fair share of the local market. I trust that this will long continue.

Nevertheless, it will be a condition precedent to the payment of bounty that bounty may be withheld from any producer who places on the domestic market a greater tonnage of copper than is considered reasonable, having regard to the sales made in a previous representative period and other relevant circumstances. The reason for this provision is that the copper bounty is designed, not so much to encourage expansion of local production, which, as I have said, is already large enough to meet all our requirements and still have a sizeable surplus available for export, but to maintain the major mines in operation during a period of depressed world prices. Briefly stated, bounty may be withheld from producers who expand sales of copper on the more profitable domestic market at the expense of other producers.

As mentioned earlier, provision is made in the bill for the rate of bounty to vary inversely and by the same amount as any rise above £275 in the cost at which electrolytic copper wire bars could be purchased overseas. In the application of this provision, it is proposed to have recourse to the London Metal Exchange prices circulated by Reuters Economic Service in much the same manner as for tariff determinations.

The Australian demand for copper is expected to rise from 38,000 tons for the year ended 30th June, 1957, to 50,000 tons per annum during the period of bounty. It is, however, expected that expenditure under the bill, after the application of the profit limitation provision, will not rise above £1.500,000 for either of the two bounty years. The bounty will continue to operate on sales of refined copper to the 30th June, 1960. It is contemplated that the Tariff Board will again examine the question of assistance to the industry before the expiry of the bounty. I. commend the bill to honorable senators.

Thursday, 2nd October 1958:

Senator McKENNA:
Leader of the Opposition · Tasmania

– The Opposition supports the measure. I think that the speech of the Minister for Customs and Excise (Senator Henty) has done justice to the subject. There is before the Senate a vastly interesting report of the Tariff Board which describes the activities of the main mines. The mines at Mount Lyell, Mount Isa and Mount Morgan, the Peko mine at Tennant Creek, and the one at Captain’s Flat which is run by the Lake

George company, are the main producers. The activities of each of those mines are reviewed very interestingly by the Tariff Board which, towards the end of its report, direct attention to the fact that in the past the copper market has been notoriously unstable and that it is reasonable to expect a continuance of widely fluctuating world prices.

It is interesting to note that since the board made its previous report in 1954, the price obtained for copper has ranged from about £300 a ton towards the end of 1954 to £500 in 1956, down to £330 in March, 1957, later to £240, and at the end of February last down to only £200. That is an enormous variation. Accordingly, the industry is exceedingly difficult to control, subsidize and stabilize. As the Minister has indicated, the Tariff Board proposed a duty alone, but the Government has coupled a movable duty with a bounty payment. The Minister’s explanation as to how they will operate is quite adequate, and I need not traverse that matter.

We trust that the bill will help to stabilize the price of this commodity, in respect of which the Australian position has changed so abruptly over recent years. We have turned from being a net importer to a net exporter of the commodity. It is really, unfortunate that, having reached that happy position, the price on the London Metal Exchange should have taken such a violent and heavy tumble. We welcome the approach that the Government has made, and hope that the bill will achieve the desired end.

Senator SCOTT:
Western Australia

– I compliment the Government upon having introduced this measure to help the copper producers of Australia. I am pleased to learn that the Opposition supports the bill. Although the measure is designed to help the major copper producers and those who have a profit limitation of 10 per cent., some producers who are producing a small tonnage of copper metal will find it difficult to keep their production within 50 tons. As they have very inadequate methods of keeping their books, they probably will not know when the first 50 tons has been produced.

I should have liked to see the gougers who are operating throughout Australia given an opportunity to produce up to 50 tons of copper without a profit limitation, provided the total amount any such company or gouger produced did not exceed 200 tons. I think it can be said that the major mines in Australia, whether they be gold or base metal mines, are the outcome of the efforts of prospectors who have gone into the back country looking for ore deposits, which have been developed to a degree sufficient to prove that the ore body was large enough to warrant exploitation by a larger company.

A person who produces 5 1 tons of copper metal will be precluded from the bounty of £45 a ton. I think that the Government should have protected the small producers, of whom there are fewer than a dozen, by allowing them to produce up to 200 tons and still be eligible for a bounty on the first 50 tons. A lot of the ore they produce is refined by the major companies. That is particularly so in Queensland. The Mount Isa mine is under an obligation, in the terms of an agreement with the copper producers, to treat up to 650 tons of copper metal a year. Before the small producers send their ore to the Larger companies to be treated, they will have to estimate the tonnage of copper metal that will be retrieved. They will try to the best of their ability to keep their production under 50 tons. If the quantity is 49 tons, they will be eligible for the copper bounty of £45 a ton. But, if their production is 51 tons, they will not qualify for the bounty, unless they are exempt under the profit limitation. In view of the fact that such a small quantity is involved, the Government could easily have allowed these small producers, who are so important to the industry, to receive this benefit. I hope that the Minister will see his way clear to do as I have suggested. Only a small sum would be involved. The overall picture is that, at a certain stage of the history of copper mining in Australia, the Government has helped the industry by guaranteeing an Australian price, by means of bounty and subsidy, of up to £330 a ton. That will keep in production our main producers who are employing thousands of people. I congratulate the Government for having done so.

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

– I do not think that even Senator Wright’s doctrine of reprisal would warrant my speaking at great length, but as the honorable senator is not in the chamber, I shall speak even more briefly than I had intended. I merely want to put on record some facts concerning the two copper mines in Queensland which are affected by this bill. 1 commend the Government on the legislation and I also commend Senator Scott on raising the question of the small producer. Perhaps the Government will consider giving effect to his suggestions by means of regulations, if it is so empowered by the act. There are many small producers in Australia who could, having regard to the limitations imposed by the 50-ton provision and the profit- margin, receive the consideration that is intended by the Government in this measure.

The Mr Morgan company will be assisted by this provision, but its position is not easy, because it is a mine which normally produces pyrites, which it has been unable to sell. Its costs of production are high, and its position is more difficult because of its inability, at the time of the Tariff Board report, to sell the pyrites which it produced. There is grave doubt whether this assistance will prove of sufficient benefit to Mr Morgan, in the long run, to enable the mine to continue profitable production. This matter is referred to in the report of the Tariff Board. At least, the proposal before us appears to offer an immediate amelioration, and I think that the mine authorities and the citizens of Queensland generally will be grateful for it.

The Mr lsa mine possibly will be the only mine in Australia that will not benefit from the bounty. The mine is prepared to sell a great proportion of its production on the overseas market and, to that extent, relieve the demand on the Australian market. We should pay tribute to it on that ground. By virtue of its profit margin and other considerations, it has not come within the scope of the bounty. Nevertheless, I think that we should be grateful to Mr Isa for the contribution it makes to the stability of the copper market and the assistance that it has given in that indirect way to the small producers to whom Senator Scott referred.

It is interesting to note that, in the course of statements made by Mr Isa mine officials to the Tariff Board, and referred to in the board’s report of 1954, it is said that Mr lsa is a big producer of zinc-lead. An attempt was made to dissect the overhead costs incurred in the production of copper from those in relation to the production of zinc and lead. I think that the Tariff Board was satisfied that the separation had been made, but in view of the recent trouble regarding the export of lead, metallic zinc and zinc concentrates, I think that one or two references to the submissions of the Mr Isa mines people to the Tariff Board in 1954 are pertinent. Mr. Firman, representing Mr Isa Mines Limited, said -

The dual operations of silver-lead and copper mining reduce the overhead that would otherwise be carried by copper. It is estimated that the added maintenance of the copper plant will increase future operating costs by £8 8s. 9d. per ton of copper. Although certain of the original silverlead plant is used in the production of copper no charge for its use is debited to copper costs.

Apparently, to some extent, the production of silver-lead and zinc has been responsible for the financial position of Mount Isa Mines Limited. It is possible that the company will soon be the greatest producer of silver-lead and zinc in Australia. We do not know whether it will be immediately affected by the action of the American Government in relation to the silver-lead market there, but according to the Mount Isa mines people, the mine exports primarily to the European and British market, and that only indirectly will it be affected if producers and exporters turn to the market which Mount Isa normally supplies. On the basis of the report of the Tariff Board, the position of the Mount Isa mines could be affected indirectly, to an extent that I could not estimate, by the present recession in the export of silver-lead and zinc, and in that event it might receive the solicitude of this legislation, which its present financial position does not warrant and which, perhaps, it has not hitherto expected to receive.

At Mount Isa, there has been a very severe reduction in the lead bonus; or the prosperity bonus. The mines have not been engaging labour at the former rate. At the moment, of course, the company is engaged, with the good offices of the State and Federal governments, in an approach to the International Bank for a loan to finance the strengthening and duplication of the railway from Townsville to Mount Isa. 1 hope that the present difficulties in the metal market will not affect the outlook for this mine and that if the position should deteriorate and it should require support, as other copper producers are now to receive under this legislation, such support will be forthcoming. I commend the Government for its action in this matter. When we consider primary production in Australia we seldom think of metals as primary products, but in that sense, perhaps it is correct to think of the Minister for National Development as a kind of assistant Minister for primary production.

As Senator McKenna has said, the base metal market has been subject to the most violent fluctuations. That is particularly aggravating to the mining industry, which requires long-range and expensive planning. It is almost impossible to do that if the industry is to be subject to these violent fluctuations. 1 trust that the metal market will soon reach a degree of stability that will ensure the continuance of production at its present level and enable the Mount Isa mines to go ahead with their tremendous expansion plans, to enable the railway to be completed, to give Australia selfsufficiency in these metals, and also to provide an increasing margin for export, something that we shall be delighted to see in the mining industry because it will help to rectify our dependence on exports of dairy products and wool as the main contributors to our supply of foreign exchange. I hope that the legislation will not only stabilize the industry but also will induce those at present engaged in it to continue to be confident and to go ahead and wait for the better times which I am sure will come.

Senator HENTY:
Minister for Customs and Excise · Tasmania · LP

– in reply - I thank the Senate for the reception that it has given to this bill. The Government considered the position regarding the gougers, and it also considered the question of production at various levels. It was of the opinion that the 50-ton provision brought the subsidy in line with the bounty on gold. The bounty on the first 500 ounces of gold is equal to the bounty on the first 50 tons of copper which, after all, produces an income of £7,500. It is not altogether correct to say that producers are precluded from benefit if they sell 51 tons of copper or more. All they have to do to qualify for the bounty is to satisfy the authorities that, after paying all working expenses and wages, they are not getting more than 10 per cent, on the capital that they have invested in the mine. From what I know of the present position of the copper industry, I should not think that there would be many gougers who would not qualify for this bounty.

Question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without amendment or debate.

page 807

BILLS RETURNED FROM THE HOUSE OF REPRESENTATIVES

The following bills were returned from the House of Representatives without amendment: -

River Murray Waters Bill 1958. Civil Aviation (Damage by Aircraft) Bill 1958. Railway Standardization (New South Wales and Victoria) Agreement Bill 1958.

page 807

QUESTION

AUSTRALIAN AIRLINES

Senator SANDFORD:

asked the Minister for Civil Aviation, upon notice -

  1. How many Ansett-A.N.A. tickets have been sold by T.A.A. under its arrangement with AnsettA.N.A. whereby each airline acts as agent and sells tickets for its competitor when it is itself unable to provide a service?
  2. What is the value of the tickets so sold?
  3. How many T.A.A. tickets have been sold by Ansett-A.N.A. under this arrangement, and what is their value?
Senator PALTRIDGE:
LP

– I now answer the honorable senator in the following terms: -

  1. The airlines advise that it is not possible to determine readily the number of tickets sold.
  2. £152,378, which is the figure for ten months -October, 1957, to July, 1958.
  3. £160,740 for the same period.

page 807

QUESTION

CUSTOMS SEIZURE OF MOTOR CARS

Senator BROWN:

asked the Minister for Customs and Excise, upon notice -

  1. How many cars were seized by the Department of Customs and Excise during the five years ended 31st July, 1958?
  2. How many of the cars were returned to their owners?
Senator HENTY:
LP

– I now answer the honorable senator in the following terms: -

  1. During the five years ended 31st July, 1958, 40 motor cars were seized by the Department of Customs and Excise.
  2. Ten of these cars were subsequently returned to the persons from whom they were seized.

page 808

QUESTION

HOSPITAL AND MEDICAL BENEFITS SCHEME

Senator BROWN:

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

  1. Is the firm known as Commercial Hospital and Medical Benefits Proprietary Limited, of 99 Stanley-street, South Brisbane, registered under the National Health Act?
  2. Is the organization meeting all just claims made by the contributing public?
  3. Has the Minister received any complaints, from contributors to the funds of this body, concerning long overdue payments of medical benefits to members?
Senator O’SULLIVAN:
LP

– The Minister for Health has furnished the following replies: -

  1. No. 2 and 3. The activities of the Commercial Hospital and Medical Benefits Proprietary Limited, which is incorporated in Canberra under the Companies Ordinance of the Australian Capital Territory were recently investigated by an inspector appointed under the ordinance by the AttorneyGeneral. A petition for the winding up of the company has been lodged by the Attorney-General in the Supreme Court of the Australian Capital Territory.

page 808

QUESTION

CANCER RESEARCH

Senator HENDRICKSON:

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

  1. Has the Commonwealth Department of Health carried out any investigations into the effectiveness of the Japanese discovery named mytomycine?
  2. Will the department give widespread publicity to other recently discovered Japanese antibiotics which are reported to have been greatly effective in arresting the spread of cancer?
  3. Is it a fact that too great an emphasis is being placed on the effects of smoking in relation to the spread of cancer, particularly when it is well known that certain pigments used in colouring food induce cancer?
  4. In view of the importance of the tobacco industry to Australia, has the Department of Primary Industry been consulted in regard to this problem which is of such magnitude and importance to Australia?
Senator O’SULLIVAN:
LP

– The Minister for Health has furnished the following replies: -

  1. No.
  2. The department will endeavour to disseminate the information as it is confirmed, but the most appropriate authorities for such an educational campaign are the National Health and Medical Research Council, the several medical schools with their associated teaching hospitals, and the various post-graduate colleges.
  3. No. It is not correct to say that too great an emphasis is being placed on the effect of smoking in the causation of cancer. It is true that certain pigments are capable of causing cancer, but this is an entirely unconnected problem for which the appropriate approach would seem to be to identify the particular pigments concerned and to eliminate them from use. To this end, the National Health and Medical Research Council, through its Food Additives Sub-committee, is undertaking an active campaign which has, with the willing co-operation of the trade, already obtained gratifying results.
  4. The Department of Primary Industry has been consulted in regard to this matter.
Senator WEDGWOOD:

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

  1. Is it a fact, as reported, that two Japanese pharmaceutical experts have discovered an antibiotic called choromycetin capable of destroying cancer cells in animals in the early stages of the disease, and temporarily checking it in more advanced cases?
  2. Has any research been done in Australia in relation to the use of this antibiotic?
  3. Has the World Health Organization any knowledge of the antibiotic?
Senator O’SULLIVAN:

– The Minister for Health has furnished the following reply: - 1, 2 and 3. There have been newspaper reports to the effect that Japanese experts have discovered an antibiotic for which success in the treatment of cancer has been claimed. However, apart from the newspaper reports I have no knowledge of the antibiotic. No doubt if it is all that is claimed, full details will be made available to the World Health Organization and the medical profession throughout the world. These details will be awaited with interest.

page 808

QUESTION

TELEVISION

Senator O’SULLIVAN:
LP

– On 20th August, Senator Sandford asked me the following question: -

I preface my question to the Minister representing the Postmaster-General by stating that some time ago I asked a question regarding the possibility of direct telecasts to Canberra from Sydney. At that time, in view of the direct reception of television in Sydney from Canberra during the Queen Mother’s visit, I asked whether the Government would explore the possibility of making permanent television- reception available1 to Canberra and. the surrounding areas coming within the scope of reception. Since then, I have been informed by technicians that permanent reception could be obtained by the erection of relay or booster masts at a cost of something less than £200,000, which amount: would soon be recouped by the, revenue received from the thousands of new licences which would be taken out. I now ask whether the Government has pursued the question of- arranging television reception in Canberra. If so, with what result? If not, will the Government make the necessary investigations? I understand that very soon there will be an influx of public servants from Melbourne who are accustomed to television, and naturally it would be a great boon for the residents of Canberra and the surrounding areas if television reception were possible in the Australian Capital Territory.

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

As explained in reply to the question previously asked by the honorable senator on 11th March, 1958, it is the Government’s policy that television services in the Commonwealth should be developed gradually. A commencement was made in Sydney and Melbourne and progress is now being made with the second stage of the plan by the establishment of stations in Brisbane, Adelaide, Perth and Hobart. The Government proposes to consider the extension of television services to other areas as soon as circumstances, including financial considerations, permit. In the preparation of future plans the claims of Canberra will not be overlooked.

page 809

PAYMENTS TO MARITIME UNIONS

Report of Senate Select Committee

Debate resumed from 30th September (vide page 695), on motion by Senator Wright-

That the report be printed.

Question resolved in the affirmative.

page 809

LEAVE OF ABSENCE TO ALL SENATORS

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

That leave of absence be granted to every member of the Senate from the termination of the sitting this day to the day on which the Senate next meets.

page 809

SPECIAL ADJOURNMENT

Motion (by Senator O’Sullivan) agreed to -

That the Senate, at its rising, adjourn till a day and hour to be fixed by the President, which time of meeting shall be notified to each senator by telegram or letter.

page 809

ADJOURNMENT

Valedictory

Senator O’SULLIVAN:
General · QueenslandVicePresident of the Executive Council and Attorney · LP

. -Imove -

That the Senate do now adjourn.

As this is the last day of the sitting of the twenty-second Parliament of the Commonwealth of Australia, I should like to take this opportunity on my own behalf and on behalf, I am quite sure, of all the Senate, to express to you, Mr. President, our appreciation of the courtesy which we have received from you during the year, which has been in keeping with the manner in which you have discharged your duties in the exalted position as President of the Senate since you were first elected to that position. All honorable senators are not only appreciative of that, but are very grateful to you for it. We should like to extend our thanks also to the Chairman of Committees and the Temporary Chairmen. I thank my colleagues of the Cabinet, and those on the Government benches, for their support and co-operation during the session. I also thank the Leader of the Opposition (Senator McKenna), and those who sit behind him for the courtesies-

Senator McKenna:

– And the discourtesies?

Senator O’SULLIVAN:

– And, of course, as the Leader of the Opposition reminds me, the discourtesies, perhaps, that they have extended to my colleagues and me during the session.

I am sorry to hear of the sickness of the Deputy Leader of the Opposition (Senator Kennelly), and I wish him a speedy recovery.

We express our appreciation of the assistance - sometimes very doubtful - that has been rendered to us, and admit the great concern that has been caused us, by the members of the Australian Democratic Labour party and the full membership of the Queensland Labour party.

On behalf of. my colleagues, I should like to pay a particular tribute to Senator, Dame Annabelle Rankin,, the Government-. Whip, for the magnificent work she has performed not only for the Government parties but, I, am quite sure, for the whole of the. Senate. I know that she has had, as far as practicable! great courtesy and consideration from the Opposition Whip (Senator O’Flaherty),

I express appreciation to the Clerks at the table and acknowledge the great assistance they have given us. To the other officers of the Senate; to that very hardworking man the Government Printer, and to the one who is probably the hardest worked of all, due to the activities of one of my colleagues, the Parliamentary Draftsman, who has had very difficult work to do from time to time at very short notice in dealing with very obtuse problems, I also extend our grateful thanks.

I should like to express my appreciation, also, to Mr. Monro, the Senior Legal Officer on the staff of the Parliamentary Draftsman, Attorney-General’s Department, to Mr. Cumming Thom, liaison officer, to the staff of the Parliamentary Library, under the Librarian, and to those wizards of the English language who can make sense out of non-sense, the “ Hansard “ staff. We extend our thanks to the gentlemen of the press who, more often than not, seem to be cut off from the outside world and to have no contact at all with their masters in the cities where their newspapers are published. Perhaps in the future we had better provide them with improved means of communication. Our thanks go also to the officers engaged in broadcasting the proceedings; to our attendants, who seem always to be at hand when they are needed and who are tireless in their attendance upon us, and to the refreshment rooms staff.

Although there will be an election between now and Christmas, and Christmas still seems a long way off, I take this opportunity of wishing everyone the compliments of the season. I hope that the results of the election, whatever they may be, will not unduly mar what should be a happy and enjoyable Christmastide.

Senator McKENNA:
Tasmania Leader of the Opposition

– I cordially endorse all that Senator O’sullivan has said in relation to you, Mr. President. I am happy to place on record the fact that our relations with you have been of the very best, and that our respect for you has grown since we assembled in this Parliament. Certainly there has been no diminution of our kindly feelings towards you. To the Leader of the Government, and to the various Ministers, I express the thanks of the Opposition for very many courtesies, and for co-operation in the difficult situations which have arisen from time to time.

Senator Wright:

– For instance, in the matter of pairs.

Senator McKENNA:

– lt is not surprising that the honorable member should have in mind apples and pears, but it was perhaps rude of him to mention primaryproduce at this stage. I offer my thanks to the Ministers and to their personal staffs and secretaries who suffer us here by day and by night and who are towers of strength to their Ministers and a great help in smoothing our path from time to time. 1 thank the Clerk and his assistants, and all those who have been mentioned by Senator O’sullivan. I would mention, in particular, Mr. Monro, Mr. Cumming Thom, the attendants, “ Hansard “ and the rest - without referring specifically to every one enumerated by the Leader of the Government. We appreciate their attention to their duties and their unending courtesy and complete efficiency. The Senate is blessed with a most happy and competent staff. Fortunately, it has the advantage of being youthful and should see all of us out: indeed, it should be here to welcome many generations of senators.

It has been a particularly strenuous year. I think that it is proper to recall that we have lost two of our colleagues - Senator Ashley on this side, and Senator Seward on the other side. They were losses which everyone in the Senate deplored. Sickness, too, struck both sides of the chamber during the present session. Six of our members are on the sick list. I should like to mention them in order to let them know we are thinking of them. They are Senator Amour, who was operated ort on Tuesday, Senator Grant, Senator Critchley, Senator Fraser, Senator Arnold and Senator Kennelly. In particular, I thank the Leader of the Government for his kindly reference to Senator Kennelly.

On the Government side two Ministers have been unwell - Senator Paltridge and Senator Cooper. We rejoice to see them back, looking fit and well. By and large, it has been a very difficult time for the Senate from the point of view of health and longevity. I know that I, for one, have been conserving my energies in anticipation of transferring’ my activity to a wider forum and arena of conflict than the Senate provides. We shall be going forth to do battle with the Government until 22nd November.

I feel sorry for the press, who for the next fortnight, will be the busiest people in Australia - speculating upon what the policy speeches will contain. In this respect the pressmen will really be in trouble.

Senator Spooner:

– I thought you were about to say they would be busy reporting your speeches.

Senator Wright:

– Then the policy speeches would be based on those that the honorable senator delivered.

Senator McKENNA:

– Weird things do happen. We shall fight the election hard, but we shall fight it fairly. Whatever the result, we will accept the decision of the electors with a perfectly good grace. We will, of course, accept it with a better grace if we happen to be over on the other side looking across at you gentlemen sitting here. Whatever the result, we will accept the decision of the electors. There will be very little immediate change, thank goodness, in the personnel of the Senate as a result of this election. Most honorable senators will carry on until at least 30th June next. We might lose sight of one or two faces temporarily. They might not appear here after to-night until 1st July, 1959.

I think that the Government will appreciate that in the last week or two we have dealt with real expedition with the legislation before us. I give the Government fair warning that that is indicative of the speed with which we will move in. the forthcoming election campaign. We hope to get so far ahead that we will blind you with our dust. I shall look forward to seeing every one again before very long. To our friends of the cross benches I extend best wishes and promise good fighting. We will see them in due course.

Senator Henty:

– With many No. 2 votes to offer?

Senator McKENNA:

– That is a nice suggestion, coming from the other side. I express my very warm appreciation of the constancy and support of my own colleagues, whom I would not wish to omit; above all, of their patience with me as their leader for so long. I do not know when that patience will run out. I also thank our Whip, who has been a tower of strength and who smiles under all conditions. I give him particular thanks for his support throughout this period.

Senator Hannaford:

– He is not half as fierce as he likes us to believe.

Senator McKENNA:

– That is so. I think that the two Whips, between them, keep this Senate running very well. 1 think that we are blessed with very good Whips. In saying that 1 bow in the direction of Senator Dame Annabelle Rankin. I think that the Senate has reason to be indebted to them both. I join cordially with the Leader of the Government in the whole of the remarks that he made. If. there is any one to whom I Save omitted to refer I trust that my remissness will be attributed to the fact that it is now very early in the morning.

Senator COLE:
Leader of the Australian Democratic Labour Party · Tasmania

– I should like to second the remarks made by the preceding speakers. To you, Mr. President, especially, I would like to offer my thanks for the courtesy extended to the members of my party. To the officers and staff of the Senate we owe a deep debt of gratitude. We appreciate all that they have done for us. To everyone we extend the compliments of the season and apologize for any uncomplimentary remarks that we may make during the election that will come along very shortly. A few faces may be missing from this place after 30th June next, but I am sure that when the election arrives our party will be in there fighting and that whoever defeats us will know that he has been fighting. We appreciate all the courteous things that have been done for us by the Ministers and their staffs. We appreciate also Senator McKenna’s leadership of the Opposition and the courtesies he has extended to us over the period. I wish all honorable senators and all those people who are connected in any way with the Senate the compliments of the coming season. May they have a very festive Christmas.

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

– As representative of the only party that is entitled to hold its caucus meetings in King’s Hall, I join in the expressions of appreciation which have come from Senator O’sullivan, Senator McKenna and Senator Cole.

I do not think we realize, until we hear a recitation of the number of .people who are instrumental in keeping this gigantic and sometimes labouring machine of parliamentary democracy going, just how many it takes to keep it on the track. To those of us who may be inclined at times to think that we occupy a more important position than we really do in this great machine of Parliament, it is salutary to think of the Clerks, the Government Printer, and, of course, you, Mr. President, to whom I express my appreciation for your many courtesies, and of all the others upon whom we must rely to keep this Parliament functioning smoothly.

I convey my appreciation to Senator McKenna for the courtesies he has extended to us, as Leader of the official Opposition, in connexion with matters on which he thought we should be consulted. I say also that he has .had a particularly difficult year with so many members of his party sitting behind him sick, or absent on account of illness. Although this has obviously thrown a great deal more work on his shoulders, he has discharged those extra duties with that distinction which we have come to expect of him.

To the Leader of the Government and the Government Whip, Senator Dame Annabelle Rankin, I also express my appreciation for keeping me informed of the businesss of the House. And here I should mention that I acted as Whip of my party when consulting with Senator Dame Annabelle -Rankin and as leader when consulting with Senator McKenna.

Changes will take place inevitably; we know that changes are going to take place because certain ‘honorable senators do not propose to submit themselves for re-election, although many of them will be here until 30th June next. Whatever the outcome of the election may be collectively and individually, we hope for the best, but it has been a great thing to serve in the National Parliament. It is a responsibility we should assume with great diffidence and which we should discharge to the best of our ability, no matter how great or how small that may be.

To you, Mr. President, all honorable senators, and the staff at the table, I extend felicitations for the Christmas season, and look forward to meeting you next year.

This has been a particularly difficult year for the Clerk, Mr. Loof, his Clerk Assistant and members of the Senate staff. I pay sincere tribute to the work done by them in connexion with the parliamentary committees that have functioned during this year and the one committee which functioned last year. We are always saying how important the committee work of the Senate is. It has proved particularly important in two major inquiries which have culminated in the reports presented to Parliament in the .last few days. I am sure that, apart from the ordinary standing committees of the Senate, those who served on the various committees realize that the compilation and presentation of the reports in time for the rising of the Parliament were in a great measure attributable to the magnificent work done by those who had been allotted by Mr. Loof as official secretaries of those Senate and standing committees. We should not let this opportunity go without placing that fact on record.

With those remarks, I convey to you, Mr. President, and to all honorable senators, my best wishes for at least a happy election campaign, and certainly for a happy Christmas, and I look forward to seeing you all in the New Year.

The PRESIDENT (Senator the Hon. Sir Alister McMullin). - On behalf of the Chairman of Committees and the Temporary Chairmen, I thank the leaders of the parties for their very kind wishes and the thoughts they have expressed in connexion with the work of the staff df the Senate. !I assure you that your good wishes are most heartily reciprocated.

Question resolved in the affirmative.

Senate adjourned at -12*45 aim. till a -day and .hour to ‘be fixed by the President.

Cite as: Australia, Senate, Debates, 1 October 1958, viewed 22 October 2017, <http://historichansard.net/senate/1958/19581001_senate_22_s13/>.