23rd Parliament · 2nd Session
The PRESIDENT (Senator the Hon. Sir Alister McMullin) took the chair at 1 1 a.m., and read prayers.
– I ask the Minister representing the Minister for Defence whether it has been decided that the .303 rifle is of small significance in the general affairs of the Department of Defence. If that is so, does the Department of Supply intend to proceed with the manufacture of it at the same rate as in the past? Will the Minister favorably consider a request to restore, in the next financial year, all the assistance that was granted to rifle clubs twelve months ago?
– I should not like to commit myself on the merits and demerits of the .303 rifle as against the FN .30 rifle. As every one knows, the FN rifle is replacing the .303 rifle, and in those circumstances the manufacture of the .303 rifle will not be continued to the same degree as in the past. The matter of assistance to rifle clubs has been carefully considered by the Government. The Government is continuing to assist them by the supply of ammunition and in other directions, but not to the extent that it has done in the past.
– Can the Minister for Repatriation give me any information as to when the psychiatric ward at the Dawes-road Repatriation Hospital in South Australia is likely to be commenced? The Minister knows, I think, that the present building is definitely sub-standard and that the authorities there have waited a long time in patience for this work to be undertaken. I am wondering whether it is likely to be included in the 1960-61 Estimates.
– I admit that there has been some delay in reaching finality in this matter. I and my department are to blame in some respects. After plans had been prepared there was some change from a medical viewpoint, and the preparation of fresh plans led to some delay. However, I can inform the honorable senator that plans have now been completed. The new psychiatric ward, which has been approved by the Public Works Committee, was given No. 2 priority in the works programme for this year, first priority being given to work in Hobart. A greater need existed for new wards at Hobart than for the psychiatric ward at Dawes-road. The existing wards at Hobart are old temporary wards put up in 1914. The work at Hobart was commenced this year. The new psychiatric ward at Dawes-road has been given first priority in the department’s major works programme. I can only say that I shall do my best to get this work started as early as possible, but much depends on the public works lo be carried out, the amount of money that is allocated by the Commonwealth Government for its own works and the priority that this work will receive in the general works programme. I hope that the new ward will be put on the works programme next year.
– My question, which is addressed to the Minister representing the Attorney-General, refers to that portion of His Excellency’s Speech in which it was stated that the Government proposes to amend the Crimes Act. Can the Minister state whether the proposed amendment will embody the recommendations of the Petrov commission with respect to espionage and security?
– I think it is section 8 of the Crimes Act which is concerned with official secrets. That section is modelled on a section of an old English Official Secrets Act which has since been superseded in England. Section 8 of the Crimes Act will be one of the sections with which the Government will deal in the terms of the Speech delivered by the Governor-General in this chamber.
– I should like to ask the Minister for Civil Aviation three questions without notice. Would the remarkable exchange of three Viscounts for two DC6’s have taken place if Trans-Australia Airlines had had a completely free hand?
Has the Government insisted on the carrying out of its policy and forced the Australian National Airlines Commission to act contrary to the best interests of T.A.A.? What would be the market price of a Viscount and what would be the market price of a DC6, having regard to the service rendered and the miles travelled by these aircraft?
– Senator Brown refers to what he describes as a remarkable exchange agreement which has been entered into between T.A.A. and Ansett- A.N.A. In point of fact, there is nothing very remarkable about it at all. Chartering as between airlines is quite a common practice. Cross-chartering between airlines for the avowed purpose of bringing benefits to both airlines, as I explained in answer to a question yesterday, is, I should think, something that would commend itself not only to airlines, but also to the Australian taxpayer, who has such a large stake in the airlines industry of this country. Senator Brown asks me whether T.A.A. would have entered into this agreement if it had had a free hand. Senator Brown can be assured that T.A.A. had a completely free hand in this matter and that no pressure of any sort was brought to bear on it. T.A.A. reached this decision as the result of a sound and complete assessment of the commercial possibilities that the future presented and an examination of its own equipment, problems and requirements. Let me repeat that any suggestion that the board of T.A.A. was influenced by any pressure whatever is a reflection upon the character of the men who control that splendid government organization.
Senator Brown further asks what are the comparative values of DC6B aircraft and Viscount aircraft, encouraged, no doubt, by the press statements which have been issued for and on behalf of the Labour Opposition in an endeavour to create the impression that the DC6B aircraft is an outmoded aircraft and that its value does not compare with that of the Viscount 700’s which were affected in the cross-charter deal. For the benefit of the Labour Opposition, and indeed all the members of the public who might have been misled by this malicious propaganda, let me put it on record once and for all that after the most exhaustive inquiry made throughout the world as to the relative values of these aircraft, the values accepted by both operators as the basis of the agreement were £280,180 for the DC6B and £225,900 for the Viscount 700.
– I direct a supplementary question to the Minister for Civil Aviation. Some months ago I asked him about the exchange of aircraft which, apparently, he did not know was taking place. At that time, I asked whether the exchange would adversely affect TransAustralia Airlines in respect of the keeping of spare parts and the carrying out of maintenance. Now that T.A.A. is to have these piston-engine aircraft, is it proposed to remove from all T.A.A. aircraft the words, “ The nation’s jetline “?
– The kernel of the question seems to be the effect that the acceptance by charter of two DC6B aircraft will have on the keeping of spare parts and the carrying out of maintenance by T.A.A. The two airlines have reached an agreement under which maintenance will be carried out and spare parts will be held by each airline at the most economical rate. There will not be any disadvantage suffered by either airline in the carrying out of maintenance under this cross-charter agreement.
– I ask a supplementary question. Is the Minister prepared to table in the Senate or to make available to senators a copy of the exact agreement between the two airlines?
– I anticipated the question and have already asked for arrangements to be made for an interview to discuss with both the Chairman of the Australian National Airlines Commission and the managing director of Ansett Transport Industries Limited the very matter which the Leader of the Opposition has raised. This is an agreement between the two operators. If neither of them objects to the Leader of the Opposition seeing that agreement, then I shall be pleased to let him have a copy of it.
– I also ask a supplementary question. During the controversy, the Minister said that the former chairman of the Australian National Airlines Commission favoured this deal. Will the Minister lay on the table of the Senate or allow senators to see the full text of Mr.
Warren McDonald’s alleged agreement? I have in mind a signed article by Mr. Warren McDonald, which appeared in a Sydney newspaper, in which he condemned this agreement.
– Over almost the entire length of the service of Mr. Warren McDonald as chairman of this organization, he and I had constant discussions about the resolution of this equipment problem. It has been recognized by objective observers of the problem for a long time that its solution lay in achieving parity of equipment, and Mr. McDonald consistently subscribed to that principle. Indeed, it stands to Mr. McDonald’s credit that, at the time of the controversy as to whether Caravelle or Electra aircraft should be bought, he came within an ace of effecting an arrangement which would have had a similar effect to that of the present arrangement. Discussions subsequent to that date all confirmed the view then held by the then chairman that there should be parity of aircraft if the problem was to be resolved.
The Deputy Leader of the Opposition refers, no doubt, to a particular report that Mr. McDonald submitted to me immediately after his resignation. He had told me prior to his resignation that he proposed to submit it to me. In that report Mr. McDonald again stated his adherence to the principle of parity of equipment achieved by some basis of exchange, although he had in mind, when writing that report and when previously discussing the matter with me, not a cross-charter but in fact a sale by one operator to the other. That report by Mr. McDonald is a lengthy document covering a number of phases of the airline industry. I shall be prepared to make the document available when I have completed my study of it and have commented upon it. When Mr. McDonald submitted the report to me, he made it quite clear that it was not a confidential document, but I will not table it piecemeal or make it available piecemeal. I shall make it available when I have had time to complete my own comments on it.
– I desire to ask a question or two - not maliciously. I thank the Minister for his efforts to clarify the issue but in the minds of the public there is a question, “ Why? “. Never mind about generalities-
– Order! The honorable senator will ask his one, two, or three questions.
– I must say, Mr. President, with all due respect to you, that it is a peculiar thing that time and time again you allow-
– Order! I will not allow Senator Brown to comment. He should ask his question.
– I know-
– What is the question?
– I will ask my question and have a private talk to you later. In asking my question, I do not desire to score politically. The Minister has stated that the reason for this exchange is to achieve parity. Does that mean that T.A.A. is being disadvantaged by this exchange - it is giving up three modern Viscounts for two DC6B’s - or advantaged at all by the exchange except in the matter of parity? Let the Senate know and let the public know whether or not under this plan of parity T.A.A. is being disadvantaged by giving up three Viscounts for two DC6B’s. Let us have the truth.
– In public statements, and in answer to a question asked yesterday by Senator O’Byrne, I have categorically said that T.A.A. itself did not feel any disadvantage as a result of this crosscharter arrangement and, indeed, if T.A.A. had felt itself disadvantaged, I do not think for a minute that it would have concurred in the arrangement. What are the advantages? As I explained yesterday, unless there was some parity of equipment achieved, each airline would necessarily have to look after its own re-equipment programme - its own purchases of new equipment - in a way which could only impose further strain on the financial resources of both airlines. Indeed, T.A.A. had an application before me for another Electra aircraft. Having regard to the disparity which exists between T.A.A. and Ansett-A.N.A. as to number of aircraft - T.A.A. holding fifteen Viscounts and Ansett-A.N.A. six Viscounts - the granting of such an application to T.A.A. would necessarily have been followed immediately by another application from the Ansett organization.
Having regard to the fact that the total fleet within Australia both as to quantity and as to quality was sufficient to meet the reasonable demands of the Australian public, both organizations said, as any two sound business organizations would say, “ Let us get together to obtain the maximum result out of the equipment available without engaging, in part at the taxpayers’ expense, in expenditure on further acquisition of new aircraft”. Doing that, they came to this agreement which, in fact, is no more than a sound commercial arrangement which should be applauded by the Australian public rather than deplored as it is by some members of the Opposition.
– 1 address a supplementary question to the Minister. Can he inform me of the cost price of the two aircraft which Ansett-A.N.A. wishes to exchange for three T.A.A. Viscounts, and also of the’ cost price of the three Viscounts? Further, can he inform me of the present monetary value of each aircraft?
– My memory is fairly good, but it does not go back to the point at which the aircraft were purchased. 1 cannot give the honorable senator, off hand, the purchase price of the aircraft, but for his benefit and for the benefit of the record, let me repeat that at the date of the agreement the value of the aircraft, accepted by the two airlines as the basis of the agreement, was, in the case of the DC6B aircraft, £280,180, and in the case of the Viscount 700 aircraft, £225,900- a difference of almost £55,000 in favour of the DC6B, if my arithmetic is correct. Let me go further. When these wild statements were made about the comparative values of the aircraft, I was interested to know who had supplied the Deputy Leader of the Opposition with information which may have led him to the conclusion that the Viscount 700 was worth more than the DC6B, because in my three years’ experience of this portfolio, which has necessitated a close following of aircraft values, I had not previously heard such a suggestion. T caused inquiries to be made at a number of places in Australia to which Senator Kennelly might have addressed an inquiry regarding the comparative values of the aircraft, and in all those places there was a negative result. Senator Kennelly had not inquired where one might reasonably have expected him to inquire. I can only draw the conclusion, therefore, that his statement was a mischievous one, made without knowledge and for the sole purpose of attempting to gain some cheap political capital - an attempt in which he failed dismally.
– I address a question to the Minister representing the Minister for Shipping and Transport. The standardization of railway gauges in South Australia is a matter of considerable interest to the Senate, particularly to South Australian senators. Although Senator Paltridge is no longer the Minister for Shipping and Transport, he may be able to tell me, first, what progress had been achieved in negotiations with the South Australian Government prior to his relinquishing that portfolio, and secondly, what progress has been made since the appointment of Mr. Opperman as Minister for Shipping and Transport.
-I do not know whether any developments have occurred within recent weeks, but I shall be pleased to refer the honorable senator’s question to my colleague, the Minister for Shipping and Transport, and obtain the information for him.
– My question is directed to the Minister representing the PostmasterGeneral. Has he been made aware of criticism by the Beaconsfield council of the buildings and facilities at the Beaconsfield official post office? Will the Minister have this matter investigated with a view to providing a new post office for this growing district of Tasmania?
– I shall be pleased to bring the honorable senator’s suggestion to the notice of the PostmasterGeneral.
– I ask the Leader of the Government in the Senate: Is it a fact that Australia has agreed to contribute almost £7,000,000 to the International Bank’s plan for the construction of link canals and water storage on the Indus
River between India and Pakistan? Can the Minister advise me whether one of the bank’s conditions for making the advance available is that the work shall be completed on a contract basis and that those contracts shall be open for competitive bidding? If so, and in view of the excellent work being carried out by Australian contractors on similar projects in Australia, will the Minister do his best to see that contracts for the Indus Valley project are widely advertised in Australia?
– I am sorry that I cannot give Senator Scott much information in reply to his question. Of course, I know something of the importance of the Indus Valley scheme and its effect on relations between India and Pakistan. I also know the reasons that prompted the Australian Government to support the International Bank in its proposal. I doubt very much indeed whether the preliminary work has been completed or whether the stage has yet been reached at which contract work can be commenced. All I can say is that I will try to keep in touch with what is going on and endeavour to put forward Senator Scott’s point of view if the opportunity to do so occurs.
– I direct a question to the Minister for Civil Aviation. While thanking the Minister for his offer to make available for my perusal the agreement between Ansett-A.N.A. and Trans-Australia Airlines if neither organization objected, will he please note that I would not be prepared to peruse that agreement on a confidential basis? Also, will the Minister please address himself to the question that I asked, which was whether he would be prepared to make that agreement available to the Senate?
– I had not thought that a document of this character, which in effect is an agreement between a private enterprise entity and a statutory corporation, should in normal circumstances be made a public document. However, in view of the obvious interest of the Opposition in this matter and its equally obvious desire to create the impression that there is something a little fishy about this agreement, if the two airline operators agree that the agreement should be made a public document I will be only too happy to make it available.
– My question is directed to the Minister representing the Treasurer. Will he inform me of the personnel comprising the committee appointed to review our taxation laws? Will he also acquaint me with the scope of the committee’s inquiry and the expected date upon which the committee will submit its report?
– I think I could more satisfactorily answer the question if I referred it to the Treasurer and obtained direct from him the information sought by the honorable senator. I shall follow that course.
– Will the Minister representing the Minister for Primary Industry tell me which primary industries are in receipt of subsidies or payments from the Commonwealth Government? What amounts were paid to such industries during the financial year 1958-59? What were the reasons in each case for those payments?
– In order to be sure that the list of such payments is entirely accurate I will ask the honorable senator to put his question on the notice-paper and obtain a reply from the Minister for Primary Industry.
– I ask the Leader of the Government in the Senate whether, in view of the increased status of Australia in world affairs and the importance now attached to personal visits between leaders of nations, the Government will consider extending an invitation to President Eisenhower, as the representative of our most powerful friend and ally in the Pacific, the United States of America, to visit Australia some time after the Summit conference, more especially now as transPacific flying time has been cut to about sixteen hours? Does not the Government believe that President Eisenhower would be given a tumultuous reception by the
Australian people? Does not the Government .believe that such a visit could have a tremendously beneficial effect upon both our defence and economic planning?
– I am sure that all sections qf the Australian community would be pleased to see President Eisenhower come to Australia. A matter such as this is best dealt with between the heads of the governments concerned, and I should not like to create any impression that the outcome rests upon my answer to the honorable senator’s question. I can only say that I shall see that the proposal is considered in the appropriate way.
– 1 address the following questions to the Minister representing the Minister for Health. Is the Minister aware that serious borer infestation has been discovered in imported prefabricated houses in more than one State and that treatment at heavy cost has been necessary? What steps are taken at ports of entry to examine such houses to ensure their freedom from pest infestation? Is the Minister seeking more effective methods of examination, in view of evidence that present methods are ineffective?
– I did read in the press a report to the effect that borer infestation had been located in some of the prefabricated houses coming into more than one State. If the honorable senator places the other two questions on the notice-paper I shall get the Minister for Health, who is responsible for the administration of the quarantine regulations, to give him a considered reply.
– Is the Minister for National Development yet in a position to make a statement to the Senate about negotiations he has been conducting in regard to the Australian Aluminium Production Commission?
– No. Negotiations are proceeding. These negotiations are of great importance, because they affect not only the position of the Commonwealth Government but also that of the Tasmanian
Government. The relevant act provides that, should the negotiations lead to some finality, any agreement entered into must be approved by the Commonwealth Parliament. I do not think it would be appropriate to discuss what is occurring when no finality has been reached.
– I ask the
Minister for National Development the following series of questions which relate to the question asked by Senator Wright and which was partially answered by the Minister: Has the British Aluminium Company made an offer for the Bell Bay aluminium industry? Has the Government an obligation to accept any offer made by the British Aluminium Company under any agreement existing between that organization and the Commonwealth? Has the Commonwealth fully informed the Tasmanian Government on all aspects of the present negotiations with representatives of the British Aluminium Company with regard to the sale of the Commonwealth Government’s interest in the Bell Bay project? Is the Minister prepared to give an assurance that the Bell Bay aluminium industry will not be disposed of until a full report has been produced to this Parliament? As the taxpayers of Australia, through the Commonwealth Government, have £9,700,000 invested in the Bell Bay works, if the Commonwealth is determined to sell its interest in the project will it give an undertaking that world wide tenders will be called? In making a final decision, will the Commonwealth take into account the consideration that any purchaser should not be put in the position of creating a monopoly of the aluminium production industry in Australia?
– I plead for a little indulgence if I do not cover all the points raised by the honorable senator. I have no desire to be other than frank about the matter. I have already mentioned that the relevant legislation provides that, if any transaction is concluded, it must be approved by the Commonwealth Parliament. We are in close touch with the Tasmanian Government about what is happening. I have no ground for criticism of my relations with Mr. Reece in this matter, and I only hope that he would say the same about me. The Government is in the position that it is bound by an arrangement originated by the preceding government to the effect that the possibility of negotiating with the British Aluminium Company should first be explored. I do not suppose I have stated it in legal terms, but that is the sense of the arrangement.
– Has the Government an obligation to accept any offer by the British Aluminium Company7
– Governments being governments, they observe obligations to which they have been committed by their predecessors, but not even the preceding government was foolish enough to leave us the obligation of accepting any offer that was made. We are not in that position. 1 think that is about all I can say.
– I address a supplementary question to the Minister for National Development. Can the Minister inform the Senate whether the aluminium firm of Reynolds, which has a great monopoly of aluminium production in the United States of America, has recently taken over the British Aluminium Company? Is it not a fact that the British Aluminium Company is negotiating for a share in the aluminium industry in Tasmania? In view of the statement by His Excellency the Governor-General that the Government wishes to inquire into monopolies and price rings, will the Government give very serious consideration to keeping the Australian aluminium industry out of the hands of the international aluminium cartel?
– The constitution of the British Aluminium Company and Reynolds’s interest in it are well known. Public statements on those matters have been made and Reynolds’s share in the British Aluminium Company is no secret. I remind honorable senators that this matter goes further than that of the situation at Bell Bay. What we as a Government have before us is not only a negotiation in regard to the Bell Bay project but also what is the best method of developing Australian bauxite deposits. It has been only in very recent times that we have discovered we have deposits of bauxite. In fact, we in Australia have more bauxite than there is in any other country. The development of bauxite resources up to the stage of smelting aluminium is a task that requires tremendous capital investment and the development of markets for aluminium products. Wrapped up with the problem is the future development of the Bell Bay project. Whether the Commonwealth Government or the Tasmanian Government retains an interest in the project or disposes of that interest still remains to be determined, but inherent in the problem is the proposal that the size of the Bell Bay undertaking shall be quite appreciably increased.
– I thank the Minister for his answer to my series of questions. However, although it was a comprehensive answer, he did not cover all the questions, probably because he did not have an opportunity to write all of them down. I should like to repeat the questions that he was not able to deal with. Has the British Aluminium Company made an offer for the Bell Bay aluminium industry? As the taxpayers of Australia, through the Commonwealth Government, have £9,700,000 invested in Bell Bay, will the Commonwealth Government, if it is determined to sell its interests in Bell Bay, give an undertaking that world-wide tenders will be called so that the greatest value will be received for this industry? The Minister has discussed the question of bauxite. Already the great deposits at Weipa are in the hands of British Aluminium and the Zinc Corporation, and so also are the other great deposits at Gove. If the fabrication and production of aluminium ingots also were placed in the hands of those companies, the basis for a monopoly in aluminium would have been established. Therefore, I ask the Minister: Before making a final decision, will the Commonwealth take into account the proposition that no purchaser should be able to create a monopoly of the aluminium production industry in Australia?
– I cannot say more than I have already said. I have no desire to walk away from these questions. The situation is that we must, so to speak, weld together and get the best results from the bauxite deposits and the Bell Bay smelter.
– Has an offer already been made?
– I am not prepared to answer that question. I am not prepared to negotiate with the world looking over my shoulder, and I know the honorable senator would not ask me to do that.
– My question is directed to the Minister representing the Minister for the Army. Will the Minister make available to the Senate a full and detailed report on the recent Rip tragedy, when some trainees were sent to their doom across, if not the most treacherous, then one of the most treacherous stretches of water in the world, in spite of official warning, and in spite of the fact that fishermen would not go out there at that time? Will the Minister, in that report, indicate what action, if any, is to be taken against the authority who insisted on that manoeuvre despite an official warning?
– The Minister for the Army has advised me that there is to be a full coronial inquiry into this happening and that until that has been held no statement will be made to the Parliament.
– Will the Minister for the Navy inform the Senate of the present expenditure on the naval air station at Nowra? I understand that, under Government policy, the station will be closed down within three years. I should like to know whether any of the expenditure at present being incurred is unnecessary because of the proposed closing of the station.
– 1 shall find out for the honorable senator the cost of running the Nowra air station this year. I think that was the first question he asked me.
– I am referring to capital expenditure.
– I shall ascertain that for the honorable senator. The second part of his question is based on a statement which he has made, but which has never been made by the Federal Government. It has never been stated by the Government that Nowra air station is to be closed down in three years’ time. The Government has stated that the Fleet Air Arm is to cease its operations by about mid-1963. It is true that at present Nowra is used as a base for the Fleet Air Arm, but it does not necessarily follow that after mid-1963 Nowra will not be used for some other naval purpose, lt is not at all true to say that it has been stated that Nowra will be shut down in mid-1963. Some expenditure is being incurred at Nowra at present. From memory, something like £12,000 is being spent on the installation of a sewerage scheme.
– I am not interested in that. If the Minister will make a check of the money that has been spent on the runways, I shall be quite satisfied.
– The honorable senator just wants to know the expenditure on the runways?
– r shall let him have that information.
– Pursuant to section 31 of the Atomic Energy Act 1953-1958, I lay on the table of the Senate the following paper: -
Seventh Annual Report of the Australian Atomic Energy Commission, together with financial accounts and Auditor-General’s report thereon, for year 1958-59.
I thought it might be of interest to the Senate if I gave a summary of some of the matters that are contained in the report. Steady progress is the keynote of this annual report of the Australian Atomic Energy Commission. The earlier years were years of innovation and trial as one new activity or another commenced in furtherance of the commission’s objectives, which are laid down in section 17 of the Atomic Energy Act 1953-1958. As the report shows, we are leaving that phase behind us.
The research programme at Lucas Heights has now settled into its stride with hard work designed to establish two basic validities. The first is that the materials which our research scientists believe can be combined to give us an economic power reactor, are in fact compatible. They must be capable of living with each other in ordinary chemical reactions and physical effects. The second is that such compatibilities as our researches do establish will hold good under the conditions of intense radiation which will obtain in a power reactor.
Side by side with the many scientific activities which are being pursued, new buildings are nearing completion and new equipment is being installed which is specifically necessary for the tasks I have mentioned. This will allow the research to be carried forward through its more advanced stages. These buildings, some portions of which are already in use, include the large metallurgy-engineering building, a building devoted entirely to beryllium research, and another devoted to isotopes and technical physics. In addition, the building which will house the Australian Institute of Nuclear Science and Engineering, and the canteen, are well advanced.
At the beginning of this year, the reactor Hifar was taken up to full power, after two years of calibration and testing. This thoroughness of preparation has produced good results in trouble-free operation. It has been greatly assisted by the advice and information provided by the United Kingdom Atomic Energy Authority, which operates the prototype of our reactor. For our part, we have willingly reciprocated with information which the authority did not possess, gained from our experience.
From what I have said, you will appreciate that Hifar is primarily a reactor for testing materials in the combinations which might occur in a reactor suitable for Australian requirements. But we can make an important subsidiary use of it. It has begun production of radioisotopes for medical, scientific and industrial use. This is one of the ways in which our atomic energy programme is providing immediate benefits. When we talk of atomic energy, we tend to think of power stations, and in Australia nuclear power is still a long-range goal. In all countries, it is further away than was commonly thought three or four years ago. The principal reason is not because nuclear power has failed to come up to expectations, but because of unexpected developments in other fields.
Most coal-producing countries now have surpluses. At the same time as fears of an imminent coal famine have been dispelled, mechanization of coal mines plus engineering improvements in power-house construction have brought down the cost of generating electricity from coal to a quite remarkable extent. Disparities of costs which once appeared only marginal have now widened appreciably. While this has been taking place, a world surplus of oil has emerged. Oil is competing with coal in many uses. This easing of fuel difficulties is, of course, welcome. It has delayed the need for the large-scale introduction of nuclear power in other countries, but nuclear power will still be required eventually. We can look forward with confidence to substantial reductions in nuclear power costs which will flow from two causes. The first is that with experience, engineering techniques will improve both in design and in manufacturing with a lowering of capital costs of nuclear power stations. The second cause is the current development of more advanced reactor systems. It is virtually certain that one or more of these will be successful in lowering both capital and running costs. The most important ingredient in running costs is fuel utilization. Countries which have already adopted programmes of nuclear power construction, therefore, are not abandoning their programmes. They are simply stretching them over a longer period.
The question is not whether nuclear power will be needed on a substantial scale in Australia, but when it will be needed. On present indications we shall be building nuclear stations by the end of this decade, and we must be ready for the day. This does not mean that by then, atomic power will be competitive in all circumstances with other forms of power. But there are areas i» Australia where the coal and water resources needed for coal-fired or hydroelectric stations are either not economical or else non-existent. We hope that suitable reactors will be evolved, which will provide power at economic rates for these areas. The choice between the different sources of power will always be determined by the relative economics of the different systems. Atomic power has the great advantage that as time goes on, progressive improvements will undoubtedly be made in nuclear power plant and fuel utilization.
Parallel with the development of power stations, which has been occupying most attention, there has been good progress in the application of nuclear energy to ship propulsion. This is exemplified by the U.S. passenger-cargo vessel “ Savannah “, due to go into operation later this year. The “ Savannah “ is not expected to be economical, but nuclear propulsion is likely to be economical for some special applications such as tankers and ore carriers within a few years, and for fairly general application in the nineteen-seventies. The commission is keeping in touch with these developments, so as to be able to give technical advice and assistance when the need arises.
The “ stretchout “ in world nuclear power programmes has, of course, reacted on the market for uranium. We now have five producers in Australia - one Commonwealth enterprise at Rum Jungle, one State enterprise in South Australia, and three companies. Rum Jungle, launched under conditions almost of emergency, has now settled down to smooth and efficient production after the inevitable troubles of the early stages. Our chief concern at the moment is to discover further ore within reasonable reach of the treatment plant to support future operations. Having fostered a successful uranium mining industry in Australia, the Government is anxious to keep it alive and active in the face of the lull in demand which can be foreseen at the expiration of current contracts. We are giving close attention to this problem.
In conclusion, I would like to touch on the international aspects of atomic energy. Our research owes much to the cooperation we have received from our friends overseas. We have bilateral agreements for peaceful co-operation in atomic energy matters with the United Kingdom and the United States. Last year, we complemented these by concluding a similar agreement with Canada. I might add that we have always enjoyed the most cordial help from Canada in this field. Along with these bilateral arangements, we are playing an active part in the International Atomic Energy Agency. It is a tribute to the Australian programme that this country is selected without hesitation for a seat on the Agency Board of Governors, as the country most advanced in atomic energy in SouthEast Asia and the Pacific.
– I move -
That the paper be printed.
I ask for leave to continue my remarks at. a later stage.
Leave granted; debate adjourned.
– On behalf of the Public Accounts Committee I present the following report: -
Forty-sixth Report - Outstanding Claims, sections 36 (2.) and 51 (f) of the Audit Act 1901-1959. and move -
That the paper be printed.
Some years ago the Treasurer arranged that his department would inform and discuss with the committee the substance of major alterations to the Audit Act. This forty-sixth report of the committee, which flows from such an inquiry, deals with two sections of the Audit Act - sections 36 (2.) and 51 (f) which require departments, at the close of each financial year, to prepare and submit to the Treasury statements of all claims outstanding at the close of the year which might, by law, have been paid out of the Consolidated Revenue Fund. The Auditor-General is required to disclose details of those outstanding claims to the Parliament. The purpose of the committee’s inquiry was to consider whether the preparation of these statements, which involve the employment of considerable numbers of staff at an important time of the year, should be continued.
From an administrative viewpoint, there are sound grounds for the repeal of the legislative provisions concerned: And from the viewpoint of the Parliament, we think its interests can be protected just as effectively by other means without the effort involved under the existing legislation. We have therefore recommended the repeal of sections 36 (2.) and 51 (f) of the Audit Act.
It is perhaps fitting that I should inform the Senate that this is the last report which will be prepared for the committee by its present chairman, Professor F. A. Bland, the honorable member for Warringah in the House of Representatives. Professor Bland, who, before his entry into Parliament in 1951, had a distinguished career in the field of public administration, has been chairman of the Joint Committee of Public Accounts since its reconstitution in 1952.
We deeply deplore the circumstances which have required the resignation of Professor Bland, who brought to the chairmanship of this committee exceptional qualities gained over many years as a teacher, lecturer, writer, and holder of the first chair of public administration at the University of Sydney. Added to a very profound knowledge and great experience was a burning belief in the supremacy of Parliament. The fearless, penetrating and constructive approach of Professor Bland has been an inspiration to all members of the Public Accounts Committee in whom he has at all times sought to inculcate his own respect for the dignity and authority of Parliament. During his long and honorable career he has written and made many statements which will serve as powerfully worded warnings on the problems associated with the running of modern government and the necessity for keeping the reins of government in the hands of the people’s elected representative.
I have had the privilege of serving under Professor Bland since 1955 and I should like to-day in this chamber to thank him for his unfailing courtesy and his assistance to me at all times. The knowledge that I have gained from him will be of inestimable value throughout the remainder of my lifetime. Under his guidance the committee has earned a very significant place in the Parliamentary structure and gained for itself the respect of every section of the community. Scholarly by training and gentlemanly by nature, Professor Bland has set an example that will be a guiding star to future committees, and his work, recorded in the reports to this Parliament and in his many writings, will find an abiding place in the history of the Commonwealth of Australia.
.- I deeply regret the circumstances that have caused Professor Bland to resign from the Public Accounts Committee. He is widely known, not only throughout the Commonwealth but also elsewhere, for his work. I think it is possible to go round Australia and to meet everywhere officers of the Commonwealth Public Service in high positions who were at some time or other pupils of Professor Bland. His work will remain with us because of the reports that he has furnished to the Parliament since he became chairman of the Public Accounts Committee. Never have I been associated with a gentleman who was so conscious of his objective when he undertook any task. He was always conscious of what he was attempting to find and he worked positively towards that end. His reports will remain as a monument to his service to this Parliament.
I regret to say, especially on this occasion, that some honorable senators and some members of the House of Representatives have, on occasions, disparaged the work of the Public Accounts Committee. When I hear any one disparaging the work of that committee, I say to myself, “ He does not understand finance at al! “. I have heard the work of the committee disparaged and statements made that the recommendations of the committee were never implemented by the Government. How little is known of that feature of the work of the committee! Every recommendation submitted to the Parliament by the committee is considered by the Treasury and the Public Service Board and I know of my own knowledge, that where possible those recommendations are implemented.
Professor Bland has been admired by nearly every one for his work in the Parliament and outside it. I know that as chairman of the committee he had no politics at all. He was at all times the most independently minded man with whom it was possible to be associated. It was a pleasure at all times to work with him. Never once did I attend a meeting of the committee without learning something from him. I have said that his reports will remain as a monument to his great work in this Parliament. I prefer to remember him as a kind, genial gentleman.
– [ should like to address myself quite briefly to the motion before the Senate. It was my privilege to serve as a member of the first and second Public Accounts Committees after that body had been reconstituted. Professor Bland was, of course, the initial chairman. He is the only chairman that the committee has had since it was reconstituted. I recall his insistence in the early days that the committee’s work should come to be regarded as something of a really responsible character that would be accepted not only by the Parliament of the Commonwealth but also by the people of the Commonwealth as a useful and proper contribution to the administration of this country. In the early days, his work was consistently directed to this end. The success of this work is now apparent, because in fact, the reports of the committee are accepted by this Parliament and, I believe, by the public as statements of great value and of great assistance to all those whom they concern.
I deplore the circumstances that have made it necessary for Professor Bland to tender his resignation. 1 take the opportunity of expressing the hope that the health of his wife which, in recent years, has not been good, will be considerably improved by the fact that the professor, relieved of his very onerous duties as chairman of this important committee, may possibly be able to spend more time with her. Sir, I warmly and sincerely associate myself with the remarks that have been made by Senator Wedgwood and Senator Benn, and I place on record my personal high tribute to the magnificent work that has been done by Professor Bland. I wish him well in the future.
.- I, too, as a member of the Public Accounts Committee, should like to pay my tribute to a very great Australian. It is a matter for great regret that circumstances have forced Professor Bland to relinquish the position that he has held with such great distinction for so long. It is true to say that he has set a pattern of conduct in public administration that will remain as a monument to him for generations to come. As chairman of the Public Accounts Committee, he also has set a pattern that may be emulated with advantage by all of those who follow him. He had only one objective, which was to decide for himself what was right and what was wrong. Having come to the correct conclusion, he pursued his policy of fostering that which was right. As Professor Bland bows out of this committee that he has graced for so long with, such distinction, I should like him to know that those who have worked with him have for him not only a very high regard but a very personal affection.
Question resolved in the affirmative.
Motions (by Senator Spooner) - by leave - agreed to -
That a Standing Orders Committee be appointed, to consist of the President, the Leader of the Government in the Senate, the Chairman of Committees, and Senators Cooke, Kendall, Nicholls, O’Byrne, Vincent and Wright, with power to act during recess, and to confer with a similar committee of the House of Representatives.
That a House Committee be appointed, to consist of the President and Senators Amour, Aylett, Drake-Brockman, Hannaford, Sandford and Wardlaw, with power to act during recess, and to confer or sit as a joint committee with a similar committee of the House of Representatives.
That a Printing Committee be appointed, to consist of Senators Benn, Buttfield, Cooke, Marriott, Robertson, Sandford and Scott, with power to confer or sit as a joint committee with a similar committee of the House of Representatives.
– I have to inform the Senate that I have received letters from the Leader of the Government in the Senate nominating Senators Laught, McKellar, Wood and Wright, and from the Leader of the Opposition in the Senate nominating Senators Arnold, Cooke and Willesee to be members of the Standing Committee on Regulations and Ordinances.
Motion (by Senator Spooner) - by leave - agreed to -
That a Standing Committee on Regulations and Ordinances be appointed, to consist of Senators Arnold, Cooke, Laught, McKellar, Willesee, Wood and Wright, such senators having been duly nominated in accordance with the provisions of Standing Order No. 36a.
Motion (by Senator Spooner) - by leave - proposed -
That a Library Committee be appointed, to consist of the President and Senators Arnold, Hendrickson, Kendall, McCallum, Robertson and Tangney, wilh power to act during recess, and to confer or sit as a joint committee with a similar committee of the House of Representatives.
– There being no further nominations, a ballot will be taken. Ring the bells. (The bells having been rung, the Clerk read the names of the candidates and the distribution of the ballot-papers proceeded) -
– The clerks at the table having handed out the ballot-papers, honorable senators will now vote by striking out the name of one nominee whom they do not wish to serve on the committee. I invite Senator Spooner to come to the table and act as a scrutineer. (A ballot having been taken) -
– I declare that the following senators have been chosen to serve on the Library Committee: - Senators Arnold, Kendall, McCallum, McManus, Robertson and Tangney. The voting figures were - Senator Arnold, 54; Senator Hendrickson, 22; Senator Kendall, 54; Senator McCallum, 54; Senator McManus, 34; Senator Robertson, 53; and Senator Tangney, 53.
The question is -
That a Library Committee be appointed, to consist of the President and Senators Arnold, Kendall, McCallum, McManus, Robertson and Tangney, with power to act during recess, and to confer or sit as a joint committee with a similar committee of the House of Representatives.
Question resolved in the affirmative.
Message recieved from the House of Representatives intimating that Mr. Pearce, a member of the House of Representatives, has been appointed a member of the Joint Committee on the Broadcasting of Parliamentary Proceedings in the place of Mr. Opperman, resigned.
Debate resumed from 9th March (vide page 71), on motion by Senator Lillico -
That the following Address-in-Reply to the Speech of His Excellency the Governor-General be agreed to: -
May it Please Your Excellency:
We, the Senate of the. Commonwealth of Australia in Parliament assembled, desire to express our loyalty to our Most Gracious Sovereign, and to thank Your Excellency for the Speech which you have be^n pleased to address to Parliament.
Upon which Senator Kennelly had moved, by way of amendment -
That the following words be added to the Address-in-Reply: - “ , but desire to advise Your Excellency that the Government no longer possesses the confidence of the Parliament and cf the Nation because of -
its failure to halt inflation with its adverse effects on wage and salary earners, on pensioners, on persons on fixed incomes, on primary producers and on home builders, particularly those wilh young families;
its action in lifting import restrictions wilh its accompanying threat to the employment of thousands of Australians and the security of Australian enterprises; and
its decision to ask ibc Arbitration Com mission to reject the current application of the trade union movement for an increase in the basic wage “.
– Mr. President, last night 1 had just concluded a summary of the history of wage assessments by the Arbitration Court based on my own experiences over the past twenty years. I stated that on only two occasions during the term of office of this Government had the Arbitration Court made any re-assessment of wages, and that in point of fact there had been only three overall assessments of margins by the court since the mid-depression years. I also stated that from the nature of the decisions of the Arbitration Court, and more latterly the Arbitration Commission, in point of fact there had been no real increase in the marginal portion of the workers’ wages in the sense of purchasing power. In other words, each decision of the court was more in the nature of a re-assessment of margins to restore their relativity to the then basic wage or, in other words, to restore to the marginal portion of the workers’ wages the purchasing power lost since the previous assessment.
In 1947 the effect of the court’s decision was to apply to the higher margins in the various awards an increase of 16s. for every 30$. existing in the margin at that time. With respect to the lower classifications, another mathematical formula was used, namely to increase to 22s. every 8s. in the margin. That formula was applied to margins of less than lis. and had the effect of increasing the margin of the largest group of workers in the lower classifications - process workers - from 8s. to 22s. Those increases were granted in 1947. Not until 1954 were margins again reviewed by the court. On that occasion the court again applied a mathematical formula. The court took 1935 or thereabouts as the base year and multiplied the margins existing in 1235 by two and one-half. In 1954 the court made no decision with regard to the lower classifications of margins, and no increase whatever was granted to workers on the lower classifications under federal awards. That means in effect that workers on the lower range of margins reverted to their 1935 margins so far as purchasing power was concerned. With regard to the tradesmen and allied classifications the two and one-half times formula adopted by the court was on the basis that between prewar years and 1954 the purchasing power of the £1 had decreased to such an extent that in 1954 an amount of £2 16s. 8d. was required to purchase goods that could have been purchased pre-war for £1. There can be no doubt that the 1954 decision by the court was not a marginal increase in the true sense. It was a re-assessment of the margins to restore some of their lost purchasing power.
That brings me to the last decision of the commission in December, 1959. Again the commission granted a blanket increase of 28 per cent, in margins. It cannot be disputed that the commission’s purpose on this occasion was also to restore the lost purchasing power of the margins. I think anybody statistically minded could easily satisfy himself that the purchasing power of money has fallen by at least 28 per cent, since 1954. The history of assessments by the Arbitration Court indicates clearly that in respect of margins there has been no real increase in terms of purchasing power. It follows that during the war years and up to 1 947, when costs outstripped margins, the workers were at a disadvantage as far as the purchasing power of their margins was concerned, lt is also true that between 1947 and 1954, when prices rose at an unprecedented rate, the workers suffered in the purchasing power of their margins. As I mentioned last night, during that period there was some compensation because of the automatic adjustments to the basic wage. But dealing with margins alone it cannot be denied that between 1947 and 1954 workers in receipt of the award wage only suffered because of the decline in the purchasing power of their margins.
From 1954 onwards the purchasing power of margins suffered every time there was a rise in prices. As I have pointed out, on only three occasions since the war have the margins of workers been in any way truly equated to the purchasing power of money. In the intervening years between those reviews of margins the workers have suffered. It cannot be denied that the decisions of the Arbitration Court have done no more than restore to margins their lost purchasing power, and in some cases they have not even done that.
That brings me up to the present time. Having dealt with margins I come back to the other portion of workers’ wages - the basic wage portion. As I mentioned last night, and as Senator Cant said, automatic adjustments to the basic wage, based on the Commonwealth Statistician’s C series figures, were suspended by the court in 1953 on the application of the employers, who were supported by this Government. The application was opposed by the unions on the ground that automatic adjustment of the basic wage was the only safeguard the workers had against a continual rise in prices. The employers argued that automatic adjustments of the basic wage created a condition of a dog chasing its tail. They argued that the escalator clause in awards should be suspended - that automatic adjustments should be suspended.
Sitting suspended from 12.45 to 2.15 p.m.
– Mr. Deputy President, before the suspension of the sitting I made the point that assessments by the Arbitration Court over the last twenty odd years had not resulted in any real increase in the money value of margins and that perhaps those adjustments could better be described as being a re-assessment to equate wages with the purchasing power of money. I also dealt with the basic wage. In the early stages of my association with the court there were two increases, the first of which, speaking from memory, was an increase of 7s. in about 1947. That was at a time, incidentally, when the Australian economy was completely controlled, and the increase had little, if any, effect on the Commonwealth Statistician’s figures. Then in about 1950 there was an increase of £1. That undoubtedly had an effect on the cost structure, because at that time there was no control over prices and profits. There possibly is some dispute as to whether that award represented any real increase in the wages of workers. If it was a real increase, it did not last for very long; it was soon swallowed up by increased prices.
Then I passed to the stage where cost of living adjustments were suspended. I said that that action was the result of a claim which was lodged by the employers and supported by this Government. The court proposed a different procedure. It proposed that in lieu of the adoption of the Commonwealth Statistician’s figures for the adjustment of the basic wage, there should be periodical reviews, and that it should be open to either party to make an application to have the matter brought before the court. The court also laid down the indices that were to be used. To put the matter in another way, I think the court said that the only argument to which it would listen would be argument based on the indices that it had proposed.
I think it is true to say that at that time those indices were approved by the employers and also by this Government. The result is that any periodical reviews of the basic wage that have been conducted since 1953 have been under terms and conditions laid down by the court and which were acceptable to the employers and this Government. At no stage have those terms and conditions been accepted by the trade union movement as a just method of assessing the basic wage. The trade union movement has claimed at all times that the basic wage should be tied to the cost of living.
That brings us to the intrusion by this Government into the hearing of claims lodged by the unions. The Government has said, in effect, to what is now the Conciliation and Arbitration Commission, “ Regardless of whether or not the unions can sustain their claim under the terms and conditions that have been laid down, regardless of whether or not they can prove that earlier increases have been swallowed up by increased costs, we say that you should not now grant any increase”. Yet last night Senator Spooner said, and I think he hoped to convince some honorable senators and perhaps some members of the public at large, that this Government had the confidence of all sections of the trade union movement. I state categorically that his statement was fallacious. It may be true to say that not all sections of the trade union movement vote for the Australian Labour Party, but it certainly is not true to say that there is any section of the trade union movement of any size that has confidence in this Government.
I suggest that, if the Government wished to enjoy some degree of the confidence of the trade union movement, its approach to the commission should be along these lines: It should ask the court not to proceed with the application at this stage but, once the court, using its own indices, had assessed the real position in regard to the basic wage, should introduce legislation to ensure that the manufacturers proved their claim for increased prices and profits. If that were done, I think probably the unions would accept the position that they should submit their claims to the commission on the basis of increased productivity, which has been referred to quite a lot during this debate. As the position is at the moment, there is nothing to prevent any increase that is granted, whether it be on the score of increased productivity or for any other reason, being swallowed up at the other end of the scale. There is no barrier to the passing on of increased wages, thereby negativing the benefit of such increase. I think there would be reason to expect greater confidence in the Government on the part of the trade union movement if someone were to tell other parties to our cost-structure that before they could pass on their costs or increase their profits beyond existing levels they would have to state a case based on indices somewhat similar to those upon which the unions must base their claims. The failure of the Government to insist upon that approach emphasises lh; difference between the policy of this Government and that of the Australian Labour Party and of the great bulk of the Australian trade union movement. If the unions are obliged to argue their case in the light of the interests of the economy, the employers should be obliged to do the same.
I think it was while Senator Cant was speaking that a query was raised as to whether it could be proved that over the last few years there ‘has been an increase in man-hour production. I think it was Senator Paltridge who interjected and asked whether there was proof that there had been a 20 per cent- increase. Probably what was exercising the mind of Senator Paltridge, if it was he who interjected, was that the Commonwealth Statistician has stated that it is difficult to draw up a productivity index to cover the whole of Australian industry. I think it is correct to say, nevertheless, that the Commonwealth Statistician is endeavouring to draw up such an index. Whether that be so or not, there is no doubt whatever that no difficulty is experienced in measuring the increase or decrease of man-hour output in individual industries. In fact, I have no doubt that most of the bigger companies could estimate the increase or decrease to a decimal. Up to the present time - whether the practice will continue in the future is in the lap of the gods - General Motors-Holden’s Limited have published an annual report and balance-sheet. In the annual report, they have displayed graphs which show conclusively how the money received from the sales of their products is distributed. One of the graphs shows the percentage paid out in wages. It would be a revelation to some honorable senators opposite if they perused those annual reports, because they would find that the wages bill paid by General Motors-Holden’s Limited is by no means the greatest expense in the production of the car.
– What is the percentage represented by wages costs?
– Approximately 20 per cent.
– The reports are available. In one year the wages cost was 17 per cent., in another year 18 per cent, and I think that it reached 20 per cent., but certainly no more, in another year. The money expended by the company on wages does not represent more than 20 per cent, of total expenditure in one year. The wages bill is certainly not as great as the amount that is paid to this Government in sales tax on the cars, because wages have never reached 30 per cent, of the total cost. I cannot prove that this is so, but I do not think that the wages bill amounts to as much as that which is received by the distributors of the products of General Motors-Holden’s. Senator Wright may scoff, but that is the position. I do not know exactly the profit margin that is allowed to distributors of the Holden product, but I know that it would be in the vicinity of 20 per cent. However, that is not very germane to the argument.
We can divide the number of employees, as disclosed in the annual reports, into the number of units produced by the company since it has been in operation. We see that year by year the unit production by employees of the company has increased. If honorable senators opposite scoff at that, I can only say that the representatives of General Motors-Holden’s in the courts do not scoff at these figures. It might be germane to this argument to mention that the stated purpose of the General Motors Corporation in endeavouring to purchase the ordinary shares that are held in Australia, is to avoid the present requirement to publish an annual report and balancesheet. The company is compelled to do that as the law stands at the moment. If we take any year from 1952, when the Holden car was well established, we shall see that it is beyond dispute that the productivity per employee or per man hour of General Motors-Holden’s has increased, despite the fact of a reduction in the working week.
In mentioning the percentage of receipts paid in wages, it should also be stated that General Motors-Holden’s does not pay only award wages. The company pays amounts well above those which it is compelled to pay under the awards, in the form of overaward payments or what is called a service loading. Those amounts are shown in the graphs that have been prepared.
In conclusion, let me say that nothing that has been said in this debate has convinced me that the wages factor in costs has had anything to do with the passing on of increased costs to the consumer. At no stage during the last ten or fifteen years could claims for increased wages have succeeded before the arbitration courts if costs had remained constant. On each and every occasion they have been based on the diminished purchasing power of money.
– 1 wish to associate myself with the speakers who have supported the motion for the adoption of the Address-in-Reply. First of all, I wish to congratulate Her Majesty the Queen on the birth of her second son. I should also like to congratulate His Excellency the GovernorGeneral on his appointment and to wish him a successful and enjoyable stay in Australia. I congratulate, too, the mover and seconder of the motion for the adoption of the Address-in-Reply on the manner in which they have carried out their tasks. 1 wish to say a few words in reply to Senator Ridley, who quoted figures purporting to come from the balance-sheet of General Motors-Holden’s Limited. He stated that only 20 per cent, of the cost of manufacture of the company’s vehicles is attributable to wages paid. He said, in effect, that if the basic wage were increased by £1 a week, or 22s. a week, we could expect that it would increase the price of the Holden motor car by only one-fifth of the amount of the increase in wages.
– I think you would find that it would not increase the price at all. The company announced that it would absorb the increase.
– I do not know anything about that, but I should like to tell the honorable senator that there is far more involved in this than the wages that are paid by General Motors-Holden’s to its own employees. The company has to purchase steel and other commodities in order to manufacture its vehicles. A general increase of wages would increase the price of those commodities quite considerably. Then, of course, it is not right to select a highly mechanized company, which turns out thousands of vehicles a year. Such a company cannot be compared with other companies which have to meet increased costs.
Opposition speakers have referred to the Government’s intervention in the basic wage case. The Government is opposing an increase of the basic wage because it does not want the workers to obtain an increase at the present time. The fact of the matter is that the margins increase granted in the last few months will cost the community in the vicinity of £65,000,000 a year, and the basic wage increase of 15s. a week will cost in the vicinity of £100,000,000 a year. If the present claim were to go through, then, immediately following the increases I have mentioned, another additional £100,000,000 a year would be involved. In all, we could expect from £250,000,000 to £300,000,000 of extra money to be injected into the economy of this country each year in the form of extra wages. The Government has been criticized during this debate for creating unemployment. I think the first two speakers in this debate yesterday said that we had far too much unemployment in Australia. They mentioned the figure of 1.6 per cent. The Deputy Leader of the Opposition (Senator Kennelly) then attacked the Government because of inflation. If we take the past as a guide when analysing the situation, we discover that during periods of depression and recession there is always a large amount of unemployment in the community. For instance, during the 1929-31 depression unemployment reached the tremendously high figure of almost 25 per cent. This Government has endeavoured at all times to maintain a stable economy. During our term of office of ten years we have had periods of inflation and periods of recession. On each of those occasions, the Government, acting on the advice of its experts, has taken the steps necessary to restore stability to the economy. I venture the opinion that no honorable senator opposite can point to any time during our term of office at which unemployment has been higher than 2i per cent.! In June, 1949, something like 5 per cent, of the work force of Australia was unemployed whereas during the real depression of 1929-31, the figure reached 25 per cent.! During the Labour government’s term, one of its supporters said - it was in 1945 - that, so far as he was concerned, if a government could reduce unemployment to less than 5 per cent, of the work force, then, to all intents and purposes, it had achieved a state of full employment. There has never been 5 per cent, of the work force unemployed during the present Government’s term. The reason why we have never had as much as 5 per cent, unemployment is that this Government believes in full employment.
How have we achieved this record? Honorable senators remember the boom in wool prices in 1952. They will remember that with that boom came a period of rapidly spiralling inflation. They will remember also that this Government took the unpopular step of skimming from the wool-growers 20 per cent, of the gross proceeds from the sale of their product and holding it to meet the following year’s tax commitments. At that time, members of the Labour Party rose in their places and condemned the Government for interfering with the wool-growers.
During 1956, 1957 and 1958, we ran into a recession. This Government immediately made available to trading banks a certain amount of the central bank’s reserve funds, and in this way bolstered ‘ the economy of the country. In 1958, we budgeted for a deficit of £110,000,000 thereby providing extra money within Australia with which to keep the economy stable. Last year, we budgeted for a deficit of £60,000,000 having the same object in view.
As a result of that action, Australia felt the effects of that world-wide recession far less than did any other country. Now we are moving out of the recession rather quickly. If I remember correctly, when this Government sought to adopt certain remedial measures some little time ago honorable senators opposite opposed us, suggesting that such steps should not have been taken during the period of recession. Now we are out of the recession and are entering another period of inflation. Within recent months, there have been two adjustments of wages which have meant the injection of an additional £150,000,000 into the economy. If the wage increases being sought at the moment are granted, £100,000,000 will be injected into the economy. The Government proposes to place before the Arbitration Commission a statement of the Government’s view of what the effect of any further increase will be. As a government, we say that the time is not ripe for the injection of another £100,000,000 into the economy.
Senator Ridley spoke at length about General Motors-Holden’s Limited, and said that that organization will be able to absorb any increases that are granted. I remind him that there are many undertakings in Australia that cannot afford to absorb the cost of further increases in the basic wage. For instance, one industry that has hit an all-time low in its returns is the fruit industry of Australia. Growers are getting less for their apples to-day than they did two years ago. Thousands upon thousands of cases of apples are being sold on the European market for less than £1 a case. Some are being sold for as little as 15s. a case f.o.b.
– You have found out the right prices at last.
– I knew the right prices when I spoke to you previously. I have mentioned 15s. a dump case for Dunne seedling apples. That is not a popular variety, and that is the lowest price of which I have any knowledge. The cost of packing that case of fruit from the time the fruit is picked in the orchard to the time the case is placed on rail in Western Australia is 9s. lOd. That is the cost of a bushel case. This means that the grower is left with a margin of only a little over 5s. to meet the cost of cultivating, pruning and spraying the orchard, picking the fruit and conveying it to the packing shed, and I suggest that this figure is at least anything from 2s. to 3s. a bushel case less than the actual cost. Honorable senators will appreciate, therefore, that the apple growers cannot absorb any additional increase in wages. I should say that the apple producers of Australia are probably worse off than any section of the community to-day. If the workers in that industry are given an increase in wages it will simply mean that many orchards will go out of production. But I say that in passing.
I should like to refer now to one or two matters mentioned in His Excellency’s Speech. First, His Excellency states that the Government is providing £2,500,000 for the development of the Ord River diversion dam in the north-west of Western Australia. It is part of a gift to the Western Australian Government for the development of the Kimberleys. I believe that this is a step which will aid considerably in bringing this great area of country into production. It is to be used to construct a diversion dam across the Ord River at Bandicoot Bar, which will enable 10,000 acres of rich irrigable land, of black loam and red loam, to be brought into production. This land will grow such crops as sugar, rice and safflower.
– Is there a market for those products?
– As a result of asking questions on that aspect during the last session, I have found that there is a ready market for rice and safflower at prices that should be profitable to producers. I do know that the price in South-East Asia of rice from Thailand is about £45 Austraiian a ton and that the Australian price at present is something over £50 a ton.
– Will the farmers carry the cost of the dam?
– This money is a gift from this Government to the Western Australian Government. There will be no cost to the farmers.
– How will a decision be made as to who will be settled?
– That point will be decided by the Western Australia Government, which will implement the scheme and establish a form of settlement that will no doubt be satisfactory to the people who want to develop this region. Can we as a nation expect to hold such a large area as the Kimberleys, which is somewhat bigger than Victoria and has a rainfall higher than that of Victoria, with a population of fewer than 2,000 white people? We must embark upon projects for its future development. It is a national responsibility to make money available for the development of outback areas.
– Is 10,000 acres the total area to be brought into production?
– That is only the beginning. The major dam will irrigate about 2,000,000 acres. This is the second stage of the development. Honorable senators will recall that the previous Commonwealth Government and the Western Australian Government entered into an agreement on a 50-50 basis for the conduct of experiments on the Ord River to determine just what could be done with the water that runs freely down that stream. The Ord is, of course, the largest river in Western Australia. More water flows out of the rivers of the Kimberleys into the sea than flows into the sea from the Murray, Mumimbidgee and Darling Rivers in South Australia. A terrific amount of water annually runs into the sea. Much of it can be conserved to irrigate the large areas of the Kimberleys that are awaiting development.
So, having decided that we can grow these crops, we are starting this scheme. We can also grow pastures for fattening stock. All of this will be achieved in the second stage of the scheme, for which this Government has made a gift of £2,500,000 to the State Government. I firmly believe that this is only the beginning of extensive development in the Kimberleys. The people of the south will be shown tie great opportunities that exist for development. This will encourage the introduction of more capital to the rich areas of the north.
South of the Ord River we have a scheme on the Fitzroy River for the growing of rice. It is conducted by a private organization. The irrigated acreage for rice and safflower growing has been increased from about 200 acres a couple of years ago to over 800 acres this year. Difficulties were experienced initially. There were floods that carried away a dam wall, and although 400 acres were planted, only 200 acres could be irrigated a year or so ago. The State Government has now provided adequate water supplies to irrigate between 800 and 1,000 acres this year. I understand that it has been shown that rice and safflower can be grown successfully in this locality. Now, after 50 years, a start is being made on the actual development of the Kimberleys, and I look forward to the day when, instead of there being about 2,000 white people in the Kimberleys, there will be about 200,000. But we have had to make a start. I congratulate this Government on its broad national outlook in making this finance available to Western Australia for the development of the diversion dam on the Ord River.
– We who are from Victoria also provide the roads.
– You used to provide some of the roads, but we have a different formula now. I should also like to give the Senate some information that will be of interest, on the large areas awaiting development in the south of Western Australia. Yesterday I asked the Minister representing the Minister for Shipping and Transport a question about shipping facilities at Esperance. I had occasion to go there within the last fortnight and I inspected with great interest the country between Albany and Esperance. I was amazed at the development that is taking place there. Strange to relate, many people are coming over from the Labour State of New South Wales where, they believe, they have not been very well treated, to settle in the southwest of Western Australia under a Liberal Government. About 2,000,000 or 3,000,000 acres are awaiting development. I can illustrate the position best by citing the case of three brothers named Kirwan, who decided in 1951, when they had virtually the seats out of their pants, with a bank overdraft of £200 and no assets, to go to Esperance. They took up about 13,000 acres of land which was sold to them for 6d. an acre, payable under the conditional purchase scheme over a period of 25 years, with no payments to be made in the first five years. They settled there in 1951, without any money. Two of them obtained work away from the property in order to keep the third on the property. After about five years the Chase syndicate made arrangements to take over an area of about 1,500,000 acres from the Labour Government in Western Australia. That syndicate was unable to carry on because it did not follow the advice of the Department of Agriculture, whose research station in the area has carried out experiments of untold value in connexion with the way that this land should be developed. If one follows its advice carefully, he cannot go wrong. The department advises a two-year process, under which the farmer burns off in November and ploughs in February. He then lets the land lie fallow for one year. In the next year he ploughs it back and seeds it after the rain. The Chase organization endeavoured to carry out this process in the first year and was unsuccessful with the germination of the clover seed that had been planted.
The Kirwan brothers carefully followed the department’s advice and this year shore some 3,000-odd sheep for 106 bales of wool valued at between £6,000 and £8,000. They also harvested 400 acres of barley, the estimated return being 9,000 bags, worth about £11,000. The astounding thing is that they intend to cultivate a further 600 acres of barley this year - similar land that has been sown down for many years with clover, which is full of nitrogen, and from which they are harvesting the clover seed. They are deriving an income of some £200 per acre of clover seed harvested. I only mention these matters as an illustration of what can be done in the south of Western Australia where there are several million acres of land awaiting development. Of course, costs in Esperance are high. The farmers have to get their superphosphate from Perth, the cost of freight being £3 10s. a ton. At the present time, they are using only 11,000 tons or 12,000 tons of superphosphate a year, but the quantity needed is gradually increasing. I look forward to the establishment of a superphosphate works in the area so that the rock sulphate can be shipped direct to the port of Esperance. Costs will then be lowered.
We in Western Australia believe that we have probably greater opportunities for rural development than exist in any other State. We have to expand our export income over the next few years. I think it can safely be said that provided this Government remains in power - I hope that it will - the population will increase in the next five years by about 1,500,000 people. According to the report of the Export Development Council, our export income will have to rise by £250,000,000 within the next five years. As our export income is almost £1,000,000,000 a year, in five years’ time it will need to be £1,250,000,000. There does not appear to be a great opportunity for development in Western Australia, apart from rural development. We are a small community and I believe that we should develop our rural industries first whilst trying, at the same time, to encourage as many secondary industries as possible. Honorable senators should not think from this statement that I am against secondary industries. We in Australia have to encourage them. Overseas capital is attracted to secondary industries commenced in the more thickly populated areas. We in Western Australia have to increase our population by the development of our rural industries before we can encourage large amounts of capital for investment in secondary industries there.
In the overall Australian picture, I think that the rural industries will find it harder and harder to get markets for their produce. We must therefore concentrate on the development of our secondary industries in order to gain the additional export income of £250,000,000 that we need. I believe that the manufacturers and the workers will have to get together in order to attain this objective. This is not the responsibility of the workers, or management, or the farmers alone; all of them must get together. Having got together, they will have to find ways and means of raising the additional money that we shall need so urgently within the next five years. 1 am fully aware of the criticism that has been offered by the Opposition that if wages and costs continually rise it will be difficult to maintain our export markets. It is true that some of the wage increases of the past have been absorbed by secondary industry, but secondary industry cannot absorb all increases. Some of our secondary industries are already battling. I emphasize the necessity for us all to get together and work out a satisfactory formula. It is the policy of this Government to see that all sections of the community in Australia get a fair go and receive a fair cut of the cake. It goes without saying that if, through continually rising wages and costs, and inefficient management, we cannot sell our goods overseas, our standard of living will fall. In order to maintain our standard of living we must increase our export income, as I have said, by about £250,000,000 a year within the next five years. In order to do so, we must improve our efficiency. We must mechanize our secondary industries as far as possible. In this connexion, science can play a valuable part. If we do this, we can look forward to a continuance of our present standard of living, of which we have every right to be proud.
I was very interested in Senator Spooner’s statement last night to the effect that the cost of living in Australia, compared with that of other countries of the world, is not excessively high. The cost of living has increased by 19 per cent, in the United Kingdom, compared with 15 per cent, in Australia. The cost of living in Canada and America has increased at the rate of 8 per cent., while that in New Zealand has increased at the rate of 14 per cent. It is common knowledge that the cost of living has risen in all countries of the world. At this stage, we do not want our costs to go any higher.
As I have said previously, this Government over the period of ten years that it has been in office has successfully maintained a stable economy. In that period, there has never been more than 2i per cent, of our work force unemployed. We have always been able to check inflationary tendencies during certain periods. If appropriate steps are taken at the right time, inflation can be controlled, and I believe that the measures the Government has announced it intends to take to control the present inflationary tendency will be successful. I should not like it to be thought that the Government is at present opposing an increase of the basic wage in order to stamp down the workers. Bearing in mind the last basic wage increase of 15s. a week and the more recent margins adjustment - both have occurred in recent months - the Government does not think that it would be a good thing for another £100,000,000 to be injected into the economy. This would only make it harder still to control the present inflationary pressures. Therefore, we have said that we will go to the commission and place our views before it.
– No, you are going further than that. You are opposing the union claim.
– I am trying to point out that, as a government, we are not opposing an increase of the basic wage simply for the sake of opposing it, to the detriment of the workers. We believe that to do so is in the interests of Australians, including the farmers, the manufacturers and the workers. That is our belief, and we stand by it.
This Government has been entrusted with the care of the Australian economy, and I suggest that we can leave it to the Australian people to judge whether the Government has acted properly or otherwise. During the last ten years the countries of the world have gone through periods of inflation and periods of recession. I suggest to honorable members opposite that Australia has felt the effects of inflation less than have some countries, and that it has certainly felt the effect of recession less than any of the countries of the western world during that time. I do not think I will be contradicted when I say that at no time during those ten years have we had more than 2i per cent, of our work force unemployed. In the six months prior to this Government coming to office, about 5 per cent, of the work force of Australia was unemployed- But that is a long time ago. We do not want to look back to the days of Labour party government; we want to look forward to prosperous times.
– The honorable senator is not referring to the period of the coal strike, is he?
– I am trying to indicate the wonderful prosperity that we have had in Australia during the last ten years. I believe, Mr. President, that we are going to see another ten years which will be even better than those through which we have just passed. I am not a bit afraid of the inflationary trend that we have in our midst at the present time, because I believe that it will be controlled as it has been controlled in the past.
In my view, the Australian people have ahead of them a period of even better economic conditions than they have experienced during the last decade. It cannot be said that the standards of living of the worker have not increased during the last ten years and that he is not better off to-day than he was ten years ago. To-day, he can go and buy almost anything that he wants to buy. Taking my own case, for instance, I now have a refrigerator, whereas ten years or so ago I did not have one because I did not have the money to buy one. Similarly, a little more than ten years ago the workers could not get some of the necessaries of life.
– They could not even get electric lighting for their homes.
– That is so.
– Has the honorable senator read about the war that we went through?
– I do not want to look back as far as that. It makes 1113 feel sad to do so, and I think it makes everyone else in the community sad when they recall the conditions that existed ten years ago.
I have much pleasure, Mr. President, in supporting the motion so ably moved by Senator Lillico and seconded by Senator Drake-Brockman.
.- Before I deal with the motion before the Chair, I should like to associate myself with the expressions of goodwill, by other honorable senators, towards Her Majesty and her family, and also towards our new Governor-General. I support the amendment moved by Senator Kennelly. In doing so, I shall try to explain the causes of inflation and indicate to what inflation is likely to lead. To the present, those who have referred to this matter, in this place and another place and also in the press, have referred to effects. They have deliberately ignored the real causes of inflation. They have attributed inflation to increased costs and prices, and to increased wages. I propose to show that there has been no real increase of charges or costs, but before doing so I should like to remind the Senate that as far back as 1896, when questions similar to those we are discussing to-day occupied the attention of people throughout the world, a professor of economics at the University of Rome, by the name of Antonio Labiola, said -
The art of persuasion does not always suffice. Often it is necessary to resign ourselves and wait until the hard school of disillusion serves to instruct better than our reason can do.
Most people are learning from the hard school of disillusion at the present time, particularly in connexion with finance.
The ex-Treasurer, Sir Arthur Fadden, at the conclusion of his Budget speech on 30th August, 1956, said -
As I have said on other occasions, inflation cannot be remedied by government action alone. The kind of measures we have taken are designed to restore a state of general balance in the economy and I think that they have had a degree of success in that direction. But inflation is a pervasive thing. It draws upon many sources and is helped along by a multitude of actions on the part of individuals and of groups. This has to be more widely recognized and there must be a common will to resist inflation and do the things necessary to avert it - to produce more, to save more, to look for ways of reducing costs and of economizing in resources, whatever the lines of activity may be. Given such an effort by the whole community, I have no doubt that inflation can be mastered and our economic and social life freed from the dislocations and injustices it entails.
That was said in 1956. Four years have elapsed since then and, us J said, the position has gone from bad to worse; so much so, that prominent businessmen and responsible men in other walks of life, are now warning the Government against inflation, whereas previously they were silent. They are beginning to fear the effects of inflation and have issued warnings about what will happen in the future. Throughout we have heard the cry, “ Produce more! “ But production has increased enormously since 1956. Stocks have increased and real capital has increased, but the inflationary position has not been improved. It is said that we must seek ways to reduce costs, but in my opinion costs have never been lower. 1 quote from a leading English authority who in 1954 published a wellwritten and carefully reasoned book entitled “ How Money is Managed “. He was Dr. Paul Einzig and he is regarded as a leading authority on the present monetary system, i direct attention to what he writes because we should think along the lines laid down by him. At page 34 of his book he states - lt would be a mistake to assume - as many people do - that sterling is now entirely divorced from gold. At the time of writing its value is pegged almost as rigidly in terms of gold as it was under the gold standard.
At page 113, and this is apropos, he states -
It is reasonable to assume that ever since the beginning of the industrial revolution >n the middle of the eighteenth century the cost of goods in terms of human effort has been declining.
So if we want to form some idea of the extent to which the country has been crippled by inflation we must bear in mind that our currency must be assessed in terms of gold and costs must be assessed in terms of labour and time. Inflation means the issue of intrinsically worthless bits of paper representing values enormously in excess of actual values. As I have said before, the inflationists are in the same category as counterfeiters. A counterfeiter seeks to obtain goods or services by passing counterfeit paper money representing various amounts. That is what is happening at present. Senator Scott referred to the world position, which is again developing as it did before the 1930 s.
I quote now from the “ Age “, of 10th December, 1959, an article headed “ Unemployment Hits U.S. Hard “, dated Washington, 9th December. The article reads -
A special Senate committee reported yesterday that unemployment has reached “ disaster proportions “ in some sections of the United States. In a preliminary report on a two-month field survey of unemployment problems, the chairman of the committee (Senator Eugene McCarthy, Democrat, Minnesota; said the group found areas where the lack of jobs “ is as bad as during the depression of the 1930’s”. The areas were not specified. “ The national figures of unemployment can be misleading”, Senator McCarthy said. “ The national rate of unemployment, seasonally adjusted, has been between 5 and 7 per cent, of the civilian labour force for the past two years and is currently at about 6 per cent.”. The lates government report listed 3,270,000 unemployed in October, about 6 per cent, of the work force. In the same period employment reached a new record of 66,800,000. Government experts estimated that lay-offs due to the steel strike added 500,000 workers to the number of unemployed. Senator McCarthy said testimony gathered by his committee showed that the rate of unemployment was more than 25 per cent, in some countries.
Conditions under which hundreds of thousands are living to-day are shocking and the more so when contrasted with the relative prosperity of the majority.
That is the position that has developed in America and it is similar to the position that developed there before the 1930’s. The depression came almost overnight and that is what will happen throughout the world again unless responsible people in control of government and the machinery of finance make the necessary adjustments to forestall it. To date they have made no efforts along those lines and prominent people in Australia and elsewhere are emphasising the need for corrective action.
Senator Scott would have us believe that in the last ten years Australia has passed through a wonderful period. Well, on 28th September last Senator Henty, in his second-reading speech on the Social Services Bill, said -
The total number of age, invalid and widow pensioners has grown from 450,000 in 1949 to the present total of over 630,000; so that it has increased since 1949 at an average rate of 20,000 a year. This means that every ls. a week increase in the pension rate now requires an additional expenditure of £1,690,000 a year, and this figure will, of course, grow progressively larger each year as the total number of penb. oners increases, lt is worth noting, too, that if the total number of pensioners continues to grow at the rate of 20,000 a year the pension bill will increase by over £4,000,000 a year even if no further increases or liberalizations are granted.
A large proportion of the age and widow pensioners are nien and women whose financial position has suffered because of inflation. During the war years they were engaged on production work. As everybody knows, they were able to keep the economy going so that the requirements of that period could be met. But when the war ended their employment was terminated. To-day they could be classified, without exaggeration, as being so many destitute wards of the State, due entirely to mechanization and the depreciation of the currency. lt will be recalled that on 31st October, 1957, I reported the extent to which currency had depreciated in England. Between 1914 and 1956 there was a depreciation of 78 per cent, which meant, in effect, that the 20s. sterling of 1914 was worth only 4s. 4d. in 1956. Since then there has been a further depreciation and to-day 20s. sterling is worth approximately 4s. After making allowance for our adverse exchange rate of 25 per cent., we find that our £1 is worth 3s. at the most - that is, in terms of gold. So there has been no real increase in wages, small salaries and small pensions. Any apparent increase has been only an increase in terms of paper money. It can be said without exaggeration that the cost of production was never lower than it is to-day when assessed in terms of gold or of labour time, they being the only two ways in which cost of production can be assessed. But the price of commodities has risen tremendously in terms of intrinsically worthless bits of paper. A leading authority has referred to it as being an economic disease. Actually it is a colossal confidence trick; that is all it amounts to. We will never be able to adjust the situation unless different methods of approach are adopted.
It is of no use honorable senators telling us that we are passing through a wonderful period of prosperity. Since 1949 the number of victims of mechanization and inflation has increased by 20,000 a year. Added to that number are those who are unemployed, their number having fluctuated between 70,000 and 80,000. So the situation that is developing in Australia to-day is similar to that which has developed in America. A two months’ survey in that country reveals that a similar situation has developed in England and throughout Europe. That is simply because we are wedded to the orthodoxy of the present monetary system. Let me quote what Dr. Einzig, who is a leading authority, has to say about inflation. At page 39 of his work, “ How Money is Managed “, he says -
When politicians or administrators decide to plunge their country into inflation for inadequate economic reasons they abuse the monetary system.
Then, at page 106, he says -
Needless to say, once inflation has reached an advanced stage its constructive aspects disappear and its destructive aspects become prominent.
Further, at page 107, he says -
In one word, a policy of rising prices is apt to create not only a fool’s paradise where producers work for fictitious book-keeping profits, but also a more or less foolproof system where mistakes escape their penalty.
He continues, at page 108 -
Feaveryear was right in saying in the concluding section of his standard work ‘The Pound Sterling’, - ‘There is- no doubt that the world’s history can afford no example of a monetary unit which has been allowed for any very long period to appreciate.’
Then at page 114 he says -
Another reason why technological progress has failed to reduce prices is that, relatively brief intervals apart, the monetary trend has been distinctly inflationary.
He further says, at page 135 -
The adoption of paper currency opened new possibilities for treasuries to secure large financial resources with the aid of monetary policy devices.
At page 137, the following passage appears - ‘
Advanced inflation, however, is liable to operate in the opposite direction because the increase of expenditure may well outdistance that of revenue.
That is exactly what happened in Germany in 1924. A state of chaos and misery was produced throughout the land. Further on, at page 142, Dr. Einzig says -
A non-stop depreciation or a too frequent repetition of devaluations tends to produce an allround demoralizing effect.
That is true. He adds, at page 260 -
Today Treasuries are responsible for the economic stability and prosperity of their countries.
That is perfectly true. Since 1949 the Australian Treasury has been responsible for the management of our monetary system. But it has failed, not because its officers would have it so but because the management of the monetary system has been in conformity with government policy. He further says, at page 275 -
If those in charge of monetary policy are anxious to avoid inflation they can do so either by fixing direct limits to the quantity of money or by setting a high standard for its quality.
This is what he had to say, at page 320, in respect of Australia -
An article in the Australian supplement of “The Economist” of 7th March, 1953, remarks that Australia is the only country in the world in which inflation is written into the Constitution.
Yet we have the statement of Sir Arthur Fadden and others that nothing can be done to alter the present situation. If honorable senators arc interested in the technique of the present monetary system, it would be well worth their while to read this book by Dr. Paul Einzig. They should study the book in the light of conditions peculiar to this country, where the destitute wards of the State are increasing at the rate of 20,000 a year. They should also consider the subject as it affects those who have been mechanized out of industry.
The author’s concluding remarks are well worth placing on record. He is a man who has written more than 40 books on finance and is an acknowledged authority on the subject. In 1938 he forecast what would happen as the result of English and American capital being used to build up the military machine of Germany. What he said in 1938 would happen, did happen. He concludes his book by saying -
The conception that a country’s economy can be run satisfactorily with the aid of purely monetary methods which became fashionable between the wars, is now at a discount. It is now realized that much more is needed than to take appropriate monetary measures and hope for the best…… In spite of its progress during the last two decades, monetary policy is always liable to remain somewhat behind in the development of the monetary situation. History in the monetary sphere seldom repeats itself exactly. There are always new factors or different combinations of the old known factors calling for original measures. Confronted wilh new situations, those in charge are often not in the position to apply rules elaborated on the basis of former experience. It is their task to adapt themselves to the new situation.
A new situation has developed. The situation that has developed to-day is quite different from that which existed between the wars and since the war. The author continues -
Only too often they have to be content wilh being wise even after the event.
That was the case after the 1930’s. He goes on -
Even that is preferable to not being wise even after the event. Mistakes will always be made through the application of wrong devices or through the application of right devices in the wrong way. Important as it is to avoid such mistakes on the basis of accumulated experience and foresight, it is even more important that the ends which monetary policy is to pursue should be correctly conceived. The solution lies in a reconciliation between social and economic ends.
There is no sign of a reconciliation at the moment in this country between social and economic ends. Wages to-day, assessed in terms of gold or labour time, have never been lower. That has been brought about by the fact that labour time continues to be a diminishing factor in production. Wages are based on the cost of subsistence plus margins for skill. In 1899, before Federation, I received a sovereign - which was a quarter of an ounce of gold - for sixteen hours work. I could quite easily do on the bench now the same work in eight hours or even four hours. The amount of gold that I would receive now would be one-eighth or one-sixteenth of an ounce. That is the reason why countries have gone off the gold standard. At that time there was the English sovereign, the American five-dollar piece, the French napoleon, the German mark, the South African sovereign and the Russian imperial. By international agreement, they were limited to a quarter of an ounce of gold. When machinery was introduced and men and women were able to produce in excess of the bare subsistence wage, the real wage was reduced. That is why the welfare state has been introduced, as a means of softening the blow. It is from that angle that the subject of inflation should be studied.
On page 114 of his book Dr. Einzig says -
Economic isolation can be attained through physical control over imports and exports or through controls of financial transfers in payment for imports and exports.
In effect, he says that you must have more controls. What has happened? This Government has allowed the banks to become laws unto themselves, with the result that banks are being built everywhere. Palatial buildings are being erected almost next door to one another. This is absolutely unnecessary. It means that banks are converting liquid capital into fixed capital, as a means of escaping the effect of the inevitable adjustment that will have to be made. The other financial institutions are doing the same thing.
Let me refer to America. It is becoming impossible to invest money in America at a profit, so American investors are coming to Australia. They are not investing their money here for the benefit of the Australian people, but rather for the benefit of themselves; they are influenced by economic necessity. They have either to invest their capital at a profit or hold it at a loss, so they come to Australia. The result is that you have these palatial offices in every city. On the outskirts of the city, where the workers live, you have houses more than 100 years old in which workers are still living. The capital cost of those cottages has been recovered over and over again, yet the rents for them are being increased. Senator Lillico said, in effect, that those who are on the receiving end, those who are enjoying the profits, are quite satisfied. Of course, they are! What constitutes profits? Profits are moneys that should have been paid for labour.
– That is nonsense! Where do you think wages come from?
– Profit is the balance left after all expenses such as the wages of workers, the wages of technicians and others have been paid. Those profits are collectively created and privately appropriated. The average worker fully understands the position. He sees profits accumulating and increasing in every direction.
– What about the return on capital invested?
– Who creates the capital? Capital is comprised of profits, land, machinery and so forth. Who creates all that? Boards of directors do not create it; it is created by the collective efforts of the working classes employed. If employees were not required to work for a subsistence wage, the accumulation of capital would be impossible.
Now we have a position in which the owners of capital and land are becoming wealthier and fewer in number. In this highly mechanized age under private monopoly control, every take-over strengthens the position of private monopoly capital at the expense of the non-owners. The nonowners, who are the workers, small business men and small farmers, are being almost liquidated; they are being reduced to the level of wage-earners. The army of wageearners is increasing, not only in this, but in every country and they are the impoverished victims of viciously unbalanced economies. Either this position is not understood by the governing authorities, or it is being deliberately ignored by them.
Such a situation cannot be allowed to go on indefinitely. If it continues, one of two things will happen. Either there will be a depression worse than that of the 1930’s or there will be a war. I can remember a depression in this country as far back as 1893. Then came the depression of 1907. This was followed by a depression just before World War I. Then came the depression of the 1920’s. Each was worse than the previous one until, in the 1930’s, we had the worst depression of all. When I took my seat in this chamber in 1938, approximately 600,000 men, women and children were expected to exist on the dole in this country of unlimited resources. They were told, “Money is not available, therefore we can do no better for you “. That state of affairs went on until 1939 when war broke out. Immediately war broke out, the Government discovered that the thousands who were living under semi-starvation conditions could be paid, fed, housed, trained and equipped for war, and that was done.
The war ended in 1945, and since then we have seen this accumulation of capital - I speak now of machinery, land, money and everything else - and we are faced with gluts in almost every direction. As an example, I refer to the fact that many thousands of tons of valuable sugar cane are being ploughed back into the land in Queensland in preference to giving the people cheaper sugar. That type of thing is happening all over the world. It happened in America during the 1930’s. Any one who cares to read the report of the International Relief Committee will be astounded to learn that, in these days when we are supposed to be intelligent, when we are supposed to be so humanitarian and so anxious to raise the standards of all, not a few of the people, such a state of affairs could exist. I repeat that if the governing authorities do not change their policies in the directions I have indicated, if they do not do something to control their economies for the benefit of all the people, there will be either a depression or another war. That is the position with which we are faced to-day. lt is of no use members of the Government telling us that everything is quite all right, that prospects for the future are bright. That has been said on the eve of every depression that ‘has taken place. It will be remembered that the economy of Germany was in a similar condition in the thirties, and Hitler said, “We must either explode or expand “. What he meant was that there would be a revolution in Germany unless export trade was expanded. In an effort to expand her export trade and control markets, Germany came into conflict with other imperial powers. At that time, for instance, England was following the same policy. Then came the war with its disastrous consequences.
After the 1914-18 war there was an interval of preparing in the directions I have indicated - the accumulation of capital on the one hand and the more or less starving of the working population on the other. To-day we have reached the stage at which in almost every country there are either small wars or revolutions, all of them having their origin in viciously unbalanced economies. I feel it necessary to say that. Other people say what I say. The federal director of the Associated Chambers of Manufactures of Australia, Mr. R. W. C. Anderson, was reported in the “Age” of 10th December, 1959, as having said -
The Government and all sections of the community must play an active part in solving this national problem. However, practically all public statements on the rises voiced fears of mounting inflation and generally concluded that industry must absorb the increased costs.
Of course, costs have only apparently increased, in terms of depreciated currency. That gentleman used the expression “increased costs “ without any qualifications. He went on to say -
The unhappy alternatives were either an expansion of demand by increasing the money supply and establishing a higher price level or else the suffering of unemployment.
He said that we should -
The workers are forced to make demands for inflated wages. How else can they expect to live, if the £1 is really worth only 3s.? The purchasing power of the basic wage has not increased since before the 1914-18 war, although, as everybody knows, production has increased enormously since that time. If I were working at a trade, I would have to work 60 hours to buy a suit similar to the one I am wearing now, whereas years ago I would have had to work only 40 hours for that purpose. While the money wage has been increased and hours have been reduced, the cost in terms of hours of work has been increased. That is the way the money system operates, and that is the way in which the workers are deceived.
Financial periodicals, including monthly reports of banks, speak of pounds, implying that there has been no depreciation in the purchasing power of the £1. They do not say that the £1 of to-day is worth only 3s. as compared with the £1 of 1914. Their inflationary policy is actually a form of corrupt, indirect, private taxation, quite independent of the government. That is why profits are becoming so colossal.
An ex-Prime Minister of Australia, who is now Lord Bruce, recently visited this country. In the Melbourne “Sun” of 11th January he was reported as saying, amongst other things, in relation to the fight against inflation, that the Government should say -
He repeated that statement later. He was very scathing in his condemnation of the Government. At every opportunity he expressed his opposition to the policy of the
Government and warned of the danger of inflation. On one occasion he said -
It is much simpler if you say inflation is the depreciation of the value of money you have got, with the result that it will buy less.
That is exactly what I have said. He repeated that day after day during his visit.
Business leaders also have had a good deal to say about the subject, but their words have fallen on deaf ears so far as the Government is concerned. The Melbourne “ Herald “ of 19th January stated -
Business leaders today urged moves to cut costs in Australia. They were commenting on a survey by the Stanford Research Institute of California, which described Australia as a “ most attractive business investment “.
They were impressed by the report to which I have directed attention, which described Australia as being most attractive for business investment. Capital cannot be invested as profitably in America, so it comes to Australia. The report continues -
President of the Victorian Employers’ Federation, Sir Lewis Burne, said the Federal Government should consider a new approach to the problem of old machinery and buildings.
One of the most substantial buildings in Melbourne, the Equitable Insurance Building at the corner of Collins-street and Elizabeth-street, was built in 1892. It is possibly the most solidly constructed building in the whole of Melbourne. It is of granite construction and I can remember, as a boy, seeing it built. It is being demolished to make way for new buildings. That is a sign that enormous profits are being made. A building that would last for another hundred years or more is being demolished. What is true of that building is true of a number of other buildings, not only in Melbourne, but also in every other capital city.
Quite a number of businessmen have gone on record in directing the attention of the Government to the problems I have mentioned. In the “Sun”, of 12th February, 1960, the Prime Minister himself was reported as saying that rises for Public Service heads were unavoidable. He said -
The new doctrine . . . appears to have been adopted that … the salary even of a highly paid executive should be divided into the basic wage plus a margin.
If the court is satisfied that rises are not justified it has the power to refuse to make them. But it does not. As we all know, cost inflation is most profitable to inflationists. Although the Government is aware of this state of affairs, it does nothing to correct it. In the Melbourne “ Sun “ of 18th February, Dr. H. C. Coombs, the Governor of the Commonwealth Bank commented on inflation. The article appears under the heading “ Inflation: Danger of ‘ Gallop ‘, warns Dr. Coombs:” and reads -
The Governor of the Reserve Bank, Dr. H. C. Coombs, warned in Adelaide yesterday that the present “ creeping “ inflation was in real danger of becoming a “gallop”.
This is typical of statements that are being made by men in responsible positions. Dr. Coombs is a man who can be called upon to take certain action and he wants to be in the position, as a far-seeing individual, to say that he publicly warned the Government of what was likely to happen. Referring to prices, he implied that something must be done. He did not say directly to the Government “You have to do something “. But nothing is done. All that has happened in this chamber and in another place is that an apology has been made for the present state of affairs and the Government has promised something better in the future.
I wish now to quote from a statement that was made on 27th February by another man who is actively and prominently engaged in business. I refer to Mr. Staniforth Ricketson, of J. B. Were and Son, who stated at the 9th annual general meeting of Hilburton Investments (Australia) Limited - when referring to more difficult conditions ahead -
The benefits derived by individuals from recent increases in basic wage and marginal rates have been short-lived.
The Arbitration Court raised the basic wage by 15s. a week as from last June, and in November granted a 28 per cent, increase (ranging up to 35s. a week) in marginal rates for metal trades workers, indicating that this should form a guide for marginal rates in other fields.
Immediately thereafter, widespread increases were conceded to employees throughout the whole range of business and industry as well as to Commonwealth and State public servants and those employed by public bodies and local authorities.
Reactions have been swift and widespread and have been intensified by the present application by the trades unions to the Arbitration Court for a further increase of 24s. a week in the basic wage.
Inevitably, these happenings have been followed by rises in the prices of a wide range of necessary commodities, including bread, milk, eggs, onions, furniture and electrical appliances, as well as in doctors’ fees and hospital and university charges. Further increases have been indicated in tramway fares and railway fares and freights, also in gas prices in some areas and in other fields.
Therefore, there has been no real increase of wages. Immediately increases are granted by the Conciliation and Arbitration Commission, prices are increased by persons who are not responsible to anybody. Therefore, any increase of wages has been cancelled out by increased prices. I remind the Senate that this has been said, not by a member of the Labour Party, but by one of the leading financiers of Melbourne. Mr. Staniforth Ricketson’s statement continues -
Indeed, the advance in costs, following recent wage increases, will most certainly involve higher prices over the whole range of economic activity in Australia during the next few months.
A significant corollary has been an appreciable advance in prices for many categories of iron and steel, which must be passed on progressively by manufacturers using steel products. . . .
Even now, the purchasing power of the Australian £1 has deteriorated, and the soundness of the national economic structure is being threatened.
I am quoting what this gentleman has said to answer Government supporters who have asserted that we on this side of the chamber have exaggerated the danger of inflation. As far as I know, Mr. Staniforth Ricketson is not identified with any political party but is permanently and actively engaged controlling the machinery of finance in this country. Despite his statement that I have mentioned, as well as other similar statements, all that the Governor-General’s Speech did was to imply that something will be done to correct the position. No specific method of tackling the problem is mentioned; this is left in the air to enable the Government to adjust its outlook according to circumstances from day to day.
– What would the honorable senator do?
– First, I would control banking and capital issues and concentrate on doing the things that are really necessary. I would pay particular attention to the housing of working people and I would provide age pensioners, many of whom are younger than I am, with an opportunity to earn a decent living instead of almost starving on a miserable pension.
Could any one imagine Senator Wright or his colleagues existing on a pension of £4 15s. a week? Why, many landlords demand this amount and more as rent! Imagine the reaction of an ultra-individualist such as Senator Wright to a situation of that kind! Faced with such a situation, 1 should not be surprised if a person of that kind applied for membership of the Communist Party.
On 1st March last, the Prime Minister (Mr. Menzies) had a lot to say about inflation, in an attempt to justify the position that has been reached. On 2nd March, the Melbourne “ Age “ published the following report of a statement by Sir Robert Knox: -
Public acceptance of the idea that some inflation was inevitable would be disastrous, the chairman of the National Mutual Life Association of Australasia Limited (Sir Robert Knox) said at the annual meeting yesterday. Life offices welcomed and supported appropriate official action to bring about greater stability in the currency, he said.
Such action has not been taken. Sir Robert Knox apparently expects it to be taken. The report went on -
Sir Robert pointed out that individual savings and life assurance, which produced the major part of capital investment, were based on confidence that the value of money would remain more constant than in recent years. “ Unfortunately in certain quarters there has been a misguided feeling that a so-called creeping inflation is an inevitable by-product of an expanding economy and full employment,” he said. However, other countries had recognized stable currency as a basic necessity, and Australia should take stock of its own situation.
Sir Robert then went on to pose four practical steps which, in my opinion, are in many ways not practical. Nevertheless, he was putting the viewpoint of one of the leading businessmen of Melbourne and of Australia. The four steps were as follows: -
Insisting on value when buying necessities, and saving something from wages.
How can a wage-earner really insist on value? If he is not prepared to pay the price asked, he has to go without. The second step was -
Giving a real pound’s worth of labour for a pound.
I suggest that the workers are giving more than £1 worth of value because, as I have pointed out, they are receiving pounds which are worth only about 3s. Sir Robert Knox’s statement is the kind of thing that is expected to impress the reading public. The third step was -
Realizing that by raising prices because of what the market will accept, we add to the price spiral.
The fourth step was -
Taking more than a passing interest in how taxes are spent.
The Melbourne “ Age “ article continued -
Sir Robert said the association was investing increasing sums in property and ordinary shares, partly because they gave some protection against inflation and also because they gave a remunerative annual yield.
That is true. Money invested in property is a much safer proposition than is money in the bank, particularly when we remember that those who years ago purchased bonds worth 10s. in the £1, to-day find they are worth only 3s. Sir Robert Knox has told us exactly what is taking place. His views are there for every one to see.
In every city of Australia, Mr. President, we see petrol stations next door to one another, and the same with banks. Skyscrapers and palatial hotels are going up, while rents for the old, dilapidated houses in which thousands of workers live are being raised. Recently, we had a visit from an American international banker, Mr. Robert L. Garner. At a press interview, Mr. Garner is reported to have said that Australians should speak frankly to the General Motors Corporation about participation in their Australian operations. An article in the Melbourne “ Sun “ of 7th March last, in referring to the interview,
The silver-haired president of the International Finance Corporation gave this advice on the HSV7-3DB programme Meet the Press . . . Mr. Garner, questioned on inflation, said that Australian land values were moving up faster than anything else he had ever seen.
That is due, of course, to inflated prices. Here we have a man of vast experience in America expressing his views on what he had seen in Australia. I think it was Senator Kennelly who pointed out last night that the worker would have to pay £2,000 or £3,000 nowadays for a block of land similar to the one on which I live and for which I paid only £150. The Melbourne “ Sun “ article continued -
Sound growth without inflation could be achieved by discipline.
What Mr. Garner meant by “ discipline “ was control of inflation and of the gentlemen who manipulate the machinery of finance for their own benefit, at the expense mainly of the working population. The article went on -
In 14 years of finance dealings around the world he was convinced that inflation was the most dangerous economic disease.
I do not call it a disease. I call it a colossal fraud that has been perpetrated in the name of British justice and equity before the law. The article continued -
He said: “ You have had reasonable stability since the war, with less inflation than most countries. But I don’t think Australians should be too complacent about that.” American inflation had been caused by wages being pushed faster than productivity.
I commend to honorable senators opposite the challenge issued by the Government itself, in which reference is made to the enormous increase of productivity in America in recent years.
I could quote the words of dozens of other men who occupy responsible positions and who are answerable to the people; not mere newspaper writers or persons who have no responsibility at all, but men who have to live up to their reputation, and I could point out how they have warned the Government about the dangers of inflation. I will leave it at that and trust that what I have said has not fallen on barren soil. If it has, then we all know that nobody can escape the consequences of his actions or inactions and nobody can escape the effects of his own ignorance. If we are complacent and wait for something to turn up we will be faced with a depression worse than that of the 1930’s or even the possibility of another world war. There are a good many people whom I would describe as political paranoics in charge of world affairs and they would involve us in another war if it were possible. An attempt was made to embroil us in war in 1956 over Suez, and in the small booklet that he wrote at the time Mr. Paul Johnson, assistant editor of the English “ Statesman “, indulged in a scathing indictment of the English government at that time. Mr. Johnson is not a Communist and he has not been indicted for libel as a result of his article. But in spite of all these warnings, which are obvious even to partially blind people, politically, nothing is being done. Like Micawber, honorable members opposite are waiting for something to turn up, wailing for somebody to give them a lead. As I have said on many occasions from platforms and in other places, those who are physically blind and those who are mentally blind require leaders, but to-day we are being led in the wrong direction. When the storm comes the Government will make all kinds of apologies for what has happened. We are not living in the past now. We are living in the present and if steps are not taken politically to control the present situation the result will be devastating. It is apparent that if the Government were to take action to control the present inflationary situation it would meet with a good deal of adverse criticism from its own supporters. Up to date, rather than face that criticism, the Government has stood still, waiting for something to turn up. The position will become really chaotic if the Government does not bestir itself and do more than it has done in the last ten years.
Senator Dame ANNABELLE RANKIN (Queensland) [4.29]. - I rise to support the motion that has been moved by Senator Lillico and seconded by Senator DrakeBrockman, and to oppose the amendment moved by the Opposition. I always feel that it is a very great occasion when we have a Speech from the Throne at the opening of a Parliament, and I deplore very much the sentiments expressed by Senator Cameron, who would have us believe that we are passing through a severe form of depression and misery in this country, and that we have no future, no hope and no light. I believe that the true story of Australia to-day is quite the opposite, not only ir; its position as a Commonwealth country but as a nation among nations.
So to-day I re-affirm my loyalty to Her Most Gracious Majesty Queen Elizabeth, and together with ali of us I offer congratulations and our message of great joy on the birth to Her Majesty in her royal household of another son, a young prince, a member of this very great family that has shown such a spirit of great service to mankind, not only in its own country but throughout the world.
The last 50 years in the history of mankind have indeed been spectacular years of achievement. We have had great dis coveries in the field of science and medicine. Great steps forward have been taken in all fields, and when one thinks of a young prince born at this time one wonders what the next 50 years may hold. I believe that we as a Parliament and people of the great British Commonwealth of Nations have a responsibility to ensure that we take the utmost advantage of these great achievements of the last 50 years and ensure that these achievements are for the betterment of mankind. That surely would be perhaps the greatest gift that we could give to the young prince born at this time.
I would like to congratulate the mover and seconder of the motion for the AddressinRepIy. I should also like to say how pleased we are to see Senator Kennelly and the Opposition Whip, Senator O’Flaherty, back in the Senate after their recent illnesses. As I said to Senator O’Flaherty recently, one Whip welcomes the return of another Whip with very sincere good wishes.
At the opening of the second session of this Parliament we heard for the first time a Speech from the Throne by our new Governor-General. Speaking not only for all honorable senators in this chamber but also for members of all political parties and for all people throughout the Commonwealth, we wish His Excellency and Lady Dunrossil good luck, good health and every happiness while carrying out their most important duties within our land. His Excellency can be assured that he has the loyalty of all of us.
I always feel that the Governor-General’s Speech is very important, for it sets the pattern of thinking of a Parliament for a period of time ahead, a pattern of thinking for a Commonwealth country and a pattern of thinking for this nation as it plays its part amongst the other nations of the world. Therefore, I cannot agree with members of the Opposition who have said that the Speech delivered by His Excellency was depressing. It was not. It was a speech that touched on a variety of subjects. It dealt with the picture both at home and abroad. What can be more important to a country than plans for the part it is to play amongst the other nations of the world? We are reminded of the forthcoming Summit conference. What an important event in world affairs that will be. We are reminded of the forthcoming conference of Commonwealth Prime Ministers. That, too, will be a very important event- Events such as those surely must have a great bearing on the future welfare of the world and the people who live in it.
The path for a government is never easy. Of course problems face us and, as my leader said in his able speech last night, not the least of those problems is the problem of inflation. But in His Excellency’s Speech we see the picture of future development in Australia, the hope of continuing prosperity, the desire for full employment and a courageous attempt to deal with this problem of inflation. I believe it is a far greater thing for a government to face problems with courage than merely to do what is popular. So I commend the Government on its actions and its plans.
I must at this stage reply to and, indeed, cross swords with a fellow Queenslander - Senator Benn - who spoke yesterday. From his speech one would imagine that the problem of unemployment in northern Queensland was very much greater than it is. We all deplore unemployment. We want full employment. We believe in the importance of full employment and all of us are greatly distressed when there is unemployment. But the places mentioned by Senator Benn - Townsville, Mackay and Rockhampton - are places that are affected by problems of seasonal work. Anybody who knows Queensland will know the problems confronting the sugar industry, which is a seasonal industry. The meat industry is in a similar position. Senator Benn was discussing employment figures in relation to those places, but he knows as well as I do that the problem there is a seasonal one and that by now the position will have changed and many of those previously listed as unemployed will have been absorbed in employment. The failure of Queensland Labour governments over the past twenty years or more to face up to the problem of seasonal employment in the meat industry has left a legacy the effects of which are now being felt in that State. That legacy is an irregular pattern of heavy unemployment from November to March or April every year. What Senator Benn did not tell the Senate was that the Nicklin-Morris Government was tackling the problem with very great sincerity and that plans were being laid to put stability into the beef industry. The need to provide a continuity of supply of cattle for killing all the year round is being given very real consideration by the Queensland Country-Liberal Party Government.
The closing down of the meatworks at Ross River and Alligator Creek has a very widespread effect on the wharfs and in the transport industry, as well as in other fields of employment. I am informed that the closure of the meatworks for this period of time costs Townsville £1,000,000 in loss of wages. That is a very great sum of money. I am sure we all deplore a loss of that magnitude. We should sincerely congratulate the present Queensland Government for having tackled this problem very strenuously. Queensland has a very active Secondary Industries Division which is playing its part in attempting to solve the problem. In addition, Mr. Morris has established standing committees at Cairns and Townsville to advise the department. I bring these facts to the attention of Senator Benn, because I feel it is unfair of him to give the impression that this problem is new or has not been given very great consideration. The previous Queensland Government - a Labour government - did nothing to encourage industries that could absorb the unemployed during the slack season, nor did it assist to provide cattle all the year round for killing. That government stands condemned on that point. I am glad that consideration is now being given to this matter.
Reference was also made in the Speech of His Excellency the Governor-General to another undertaking that will assist to overcome the problem. I refer to the Commonwealth advance of £20,000,000 for the reconstruction of the Mount Isa railway line. This will mean that greater numbers of cattle will be brought down to the killing centres. The plans of the present Queensland Government provide for greater pasture improvement and improved transport. The Mulligan Highway will bring in peninsula cattle. All this will help to overcome the very real fear of seasonal unemployment. I have felt impelled to bring these matters to the knowledge of the Senate in contradiction of the remarks of Senator Benn.
I think all Australians have been tremendously interested in the Colombo Plan. We have met students and got to know them, and have seen them at work. We have learned, too, that they have gone back to their own countries not only with the technical advice that we have given them, but also with a very real feeling of goodwill for the people of Australia. 1 can recall meeting a nursing sister who was training at a hospital and saying to her, “ It will be a great day for you when you go back to your own country having had this training “. She replied, “ It will indeed be a great day. But I will take back not only my training, but also a feeling of warmth and friendship for the Australian people which I could never have had if I had not worked in this hospital side by side with Australian nurses and doctors.” That in itself is a contribution to good relationships and unity amongst the peoples of the world, which is something that we can never measure in terms of pounds, shillings and pence.
I think we should all examine the aid that has been given under the Colombo Plan, because perhaps we do not know nearly enough about what has been done. The fact that the operation of the Colombo Plan has been extended for another five years is something we will all applaud. Aid given under this scheme will do a lot to raise the standard of living throughout the area involved and to unite the people in a feeling of goodwill. I decided to examine some aspects of the Colombo Plan, and 1 discovered that since the inception ot it Australia has spent £31,000,000 on aid, of which more than £25,000,000 has been in the form of capital aid and approximately £6,000,000 has been expended ou technical assistance, training experts, the provision of technical equipment for research purposes, and so on. Imagine how the effect of that aid will spread out through the children and the families. To use an old quotation which, strangely enough, I heard my father use in his political speeches, it is like dropping a stone into a silent pool of water and seeing the rings stretch from bank to bank. None of us will ever know how far-reaching will be the effect of the teaching that has been given in terms of goodwill between Australia and the countries concerned. The total number of trainees received under the
Colombo Plan to 31st January last was 2,761; 753 of them were still undergoing training in Australia at that time. The number estimated to be in Australia towards the end of February was greater than 800, and it is still rising steadily. It is hoped that by the end of the year 1959-60 the total number of students will rise to between 950 and 1,000. 1 feel it would be profitable to mention the kind of training and1 work that is covered by the plan. The fields of study include engineering, education and public administration. We all know how important those fields of study are. Just let us imagine what can be done in the field of engineering. It can lead to the opening up of new areas of land in countries which would not otherwise have had the opportunity to undertake such work. Training has also been given in the fields of nursing, agriculture, medicine and health. We not only are giving training that will lead to the healing of the bodies of people in these countries but also are making it possible for them to open up new areas to produce food for those who need it. I believe that the whole of Australia is proud of the part it is playing in this programme.
In addition to training students here we are sending people to give instruction in the countries concerned. We have lent experts for advisory and instructional assignments for periods ranging from a few weeks to as long as six years. Moreover, we have supplied publications and equipment for research and teaching purposes. In addition, at the request of Asian governments, we have sent 355 experts overseas at a cost of much more than £1,000,000 - a very fine contribution indeed. I am glad, Mr. President, to know that this work is continuing for another five years.
Now I should like to refer to the World Refugee Year, to which reference was made by His Excellency the Governor-General. In Australia there are very many people who have come from other parts of the world. His Excellency informed us that already approximately 250,000 refugees have taken up residence in Australia. Many of them have told us of the problems that confront friends, relatives and members of their families who are still living under the most tragic conditions and who want to migrate to a country such as ours. I listened with great interest to Mr. Nansen, a visitor to the recent Australian Citizenship Convention, when he spoke in Brisbane. My heart was touched and I am sure the hearts of all others who listened to him were touched as he told of the tragedy of families living in a single room and needing care and medical help, their way of life having been disrupted through no fault of their own - people who still do not know where their relatives are or from one day to the next what their own future is. I am glad to know that Australia is playing her part in the World Refugee Year and that people will be brought here to find freedom and security. They will know what it is to have health, hope and happiness. In their own countries there was no room for the needy, but here they will find a welcoming hand. I congratulate the Government on allowing Australia to play its part, with other nations, in the World Refugee Year.
Later in the Speech there is a comment about the housing record of this Government. His Excellency said -
The year 1958-59 saw the completion of a record number of more than 84,000 houses and flats . . . This financial year my Government is again providing approximately £80,000,000 for housing.
Honorable senators have heard me say many times that I believe one of the most important things is adequate and good housing for the people. Good housing is surely one of the most important things in family life, in the care of our aged people and in the rehabilitation of ex-service men and women. Housing means a great deal to them. I am proud that this Government has such a fine record in housing, not only in one section of the housing field, but in housing for the aged, in war service homes and, if I might use the term, in general housing.
Let us look for a few moments at the aged persons’ homes scheme. I do not think we can repeat this story too often. Honorable senators will remember, as I do, that the Government brought in legislation to make it possible for the Government to contribute to special housing schemes for our aged citizens. That was, indeed, a recognition of the work done by church and charitable organizations in caring for aged persons. It showed an understanding by this Government of the tremendous work that these bodies do. It was also a recognition of the need for our elderly citizens to have security in their old age, to be freed from a fear of loneliness or of being somewhere where they could not be cared for if they were ill, and, in the case of aged married couples, to be freed from the very real fear that in the twilight of their lives they would be separated. This legislation gave special consideration to aged married couples in garden settlements. Indeed, it gave consideration to the housing of all aged persons.
The Government began, as honorable senators know, by giving a £l-for-£l subsidy, and then increased the subsidy to £2 for £1. The stage has been reached where the Government has approved over £6,730,000. We have increased the number of beds in homes for aged persons by 7,993. It is a wonderful story, Mr. President. It is a story of great humanitarian work, a story of achievement by church and charitable organizations, a story of the appreciation by a government of the needs of our elderly citizens and of our responsibility to them in the closing years of their lives.
Then let me speak of war service homes. What a record there! It is a story of which every Australian can be proud. At the end of June last year, the Menzies Government had provided £277,202,000 for war service homes, and 123,670 homes had been built with this money. This financial year, the Government is providing a further £35,000,000, and it is expected that this will build a further 12,274 dwellings. This means that from the time this Government took office until the end of the present financial year, it will have provided a total of £312,000,000 for war service homes. Perhaps we become a little casual about millions in this Senate when we are discussing figures, but £312,000,000 is a considerable amount of money. With this amount, 136,000 homes will have been constructed. Surely that is important in the lives of Australian people.
May I remind honorable senators opposite, who have made depressing speeches, that between 1945 and 1949 the Chifley Government spent only £22,659,000 on war service homes - about £8,500,000 less than the Government has allocated for this year alone. Surely the present Government has a record in this field of which we can be proud. Since the war service homes scheme started in 1919, at the end of World War 1., about £365,000,000 has been provided for war service homes. The Menzies Government has contributed approximately 85 per cent, of that amount. It is a wonderful story.
But we still have another story to tell about housing. Up to the present, I have dealt only with two sections. This year, a record number of 84,000 new houses and flats has been erected, and another £80,000,000 is to be provided for housing. Since this Government came into office in 1950, more than 768,000 new houses and flats have been erected in Australia. The housing shortage was one of the great problems that faced us. It was disturbing people throughout Australia. It presented a great challenge, but the Government accepted the challenge with a very great sense of responsibility. As a result of its onward march in the field of housing, the Government has reduced the shortage of houses, estimated to have been 250,000 in June, 1947, and now there is virtually no shortage in most of the Australian States. New South Wales and Victoria, I believe, are the two States which still have a housing problem, but even in those two States the shortage has been considerably reduced and the construction of new dwellings continues at record levels. In 1958, nearly 80,000 new houses and flats were completed in Australia, and in 1959 the record figure of over 86,500 was recorded. Over the past five years, on an average, over 78,000 new houses and flats have been completed. This must surely show, Mr. President, that this Government fully appreciates what housing means to the community, to the well-being of the nation and to the prosperity of its people.
Let me speak for a moment or two on another section of His Excellency’s Speech. I was very pleased to hear him say that, prior to the preparation of the next Budget, the Government will consider particular problems associated with the application of the means test and the general pensions system. We all have a real concern for persons who are recipients of pensions and also for those who are excluded because of the application of the means test. I would remind the Senate that this Government has lifted the means test over and over again, with the result that more people are receiving pensions to-day. However, I believe that there is still a great deal to be done in this field. I commend the Government very sincerely for promising to look again at the problem of the means test, and I trust that the consideration to be extended will benefit all those people who in the past have been confronted with problems arising from the means test.
I think it is good to remind ourselves of some of the lesser-known services which this Government has assisted so strongly. I should like to pay a special tribute to the Government for the work which it has done since 1957 in the field of the homenursing service. I wonder how many of us realize the very great contribution which this Government is making every year to this domiciliary service, the home-nursing service, through which excellent women go into homes to care for people. They are providing a great service for those who are aged and ill. I remind honorable senators that in the first six months of the operation of the scheme, from 1st January to 30th June, 1957, the amount contributed by the Government was £1,807. By the next year, we had increased it to £18,135. In 1958-59, the figure jumped to £34,538, and the estimate for 1959-60 is £60,340. What a contribution to a service which goes into every home throughout the Commonwealth in which it is needed! It is a contribution which promotes a feeling of security and safety in aged persons who have no one else to come and care for them. This service gives them marvellous relief. We all know that if we are ill, or if one of our own is ill, we experience fear and great anxiety. We experience those feelings about ourselves, our relatives or friends, but immediately a trained person comes into the home we feel that we have amongst us a person who knows what to do, and our fears are relieved. This subsidy by the Government to the home-nursing services is something that we should let the whole world know about because it gives tremendous help to a great humanitarian service.
But I have one request to which I do ask the Government to give very serious consideration. First, however, let me emphasize the splendid work done in our rehabilitation centres. If honorable senators have not visited the rehabilitation centres in their own States I advise them not to hesitate about doing so. Recently, I visited the Kingsholme rehabilitation centre in Queensland. It gave me great heart and a feeling of exhilaration to see what has been done for people who, through accident or disease, have suffered some disability which prevents them from continuing their normal activities. These people lose confidence. Perhaps they are afraid of taking their part amongst the busy throng of the world again, and these special centres have specially trained staff with special equipment to help such sufferers. If I may speak for a moment about by own State, without being parochial, I should like to mention that in Brisbane we have, I believe, one of the most courageous people in Malcolm Bryce, a blind physiotherapist who brings to these sufferers great comfort and help, who gives them the benefit of his extensive knowledge in the world of physiotherapy. He is a shining example of courage. He is a man who lost his eyesight during the war, then trained at St. Dunstan’s. He does much to help these men and women regain their courage and their health to do a job in the community. He does much to restore in them confidence to go back into the world, be with other people and not feel afraid. He does a great deal to dispel from their minds the fear that there is no place in the world for them.
But there is one section of the community that is not able to get the help which is so necessary. I remind honorable senators that those eligible for free treatment at these rehabilitation centres must be either breadwinners, unemployed or recipients of some kind of pension. Others may have the treatment if they pay for it. I now plead the case for the young married women, the mothers and wives who have been smitten by that dread disease poliomyelitis, women who put up a courageous battle to win back their health yet who are not breadwinners in the sense that we accept the term and who are not in receipt of any pension. I am glad to say that they may obtain treatment at the centres, and I commend the Government for that, but they must pay for it, and it is costly. Surely the wife, the mother, the person who cares for the family, the mainspring of the family unit, should be assisted in every possible way! I do ask that consideration be given to those special cases. We hope that the number will never be great, for poliomyelitis is a terrible disease, but whether the number be great or small, I make a plea to-day for the married women, the mothers and housewives who have fallen victim to this paralyzing disease which makes it impossible for them to care for their homes and their families without this special remedial treatment. In our rehabilitation centres we have special remedial kitchens with special equipment, we have the trained staff and everything set up ready for use. I merely ask that these unfortunate women be given the opportunity to benefit from free treatment at these centres without causing any financial burden to either themselves or their families.
I know of one woman who is having treatment at present at a rehabilitation centre. The improvement she has shown since attending the centre is one of the most exciting and thrilling things one could ever see. She will be able to go back, take her place in the home and carry out her duties in a happy and efficient manner because of the very specialized treatment she has been getting. Unfortunately, there are many cases in which lack of finance prevents women from benefiting from this excellent treatment. I do ask that special consideration be given to these cases by the Government.
To-day we stand once again at the opening of a parliamentary session. Once more we are examining a plan laid down in the Speech delivered by His Excellency the Governor-General. It is a great plan for the future. As I read His Excellency’s Speech I am convinced that the present Government has a full sense of responsibility for the welfare of its people. It is a government which is anxious that there shall be prosperity and greater development throughout the length and breadth of the land. It is a government which is anxious that there shall be security for all, that there shall be proper care for those who need it and that Australia shall play its proper part in promoting peace in the world and amongst the nations of the world. It is a government which realizes the importance of goodwill with our near neighbours. It is a government which realizes the importance of playing its part in great world conferences. I support the mover and seconder of the motion for the adoption of the Address-in-Reply and say to one and all that His Excellency’s Speech contains a pattern and plan laid down by a Commonwealth Government which will play its part in this country and amongst the nations of the world, giving its people prosperity, security and faith in Australia. It is a plan which makes one more great step along the road to Australia Unlimited.
– In rising to take part in this debate, I associate myself with the expressions of loyalty and good wishes uttered by His Excellency the Governor-General in this chamber last Tuesday.
Ever since I have been a member of the Senate, I have been amazed to hear honorable senators on the Government side stating at every possible opportunity that the Australian Labour Party has never made any contribution to the welfare of this country. When we have looked back over the years, honorable senators opposite have scoffed at us. Let me delve into history, let me go back just a few years and tell honorable senators on the Government side just what the Australian Labour Party has done for the nation and how it has played its part in ensuring Australia’s salvation.
I go back to the war years. I go back to the time when the government in power in 1941 would not and could not shoulder the responsibility of fighting a war. So the reins of government were handed over to the Australian Labour Party. History proves that that party’s war-time effort and postwar effort put this nation well on the way towards the economic stability that it is supposed to enjoy to-day.
We have been told that during the Labour regime smaller amounts of money were expended on social services and other schemes than have been expended by this Government, but Government supporters do not realize that during Labour’s term in office the national income was much lower than it is at present, in terms of money. They do the Australian Labour Party a great injustice when they say that it has never played an important part in building up this nation.
During this debate we have heard much about the inflationary trend and about the basic wage. Other countries have had the same problem in regard to inflation, as 1 believe Senator Scott stated, but they faced up to the problem much sooner than did this Government. They faced up to it ten years ago or even earlier, but it has taken this Government ten years to realize that the inflationary spiral has caught up with the economy of the country. I take the minds of honorable senators back just two years, when the Prime Minister (Mr. Menzies) said in his policy speech that the economy of the country had reached a state of equilibrium and that the stability of the nation was greater than it had ever been before. He also said that the Government, upon being returned, would restore value to the £1. Much is being said in this debate about the value of money, but it has taken the Government a long time to realize just where Australia is going
I congratulate the Government on what it has done over the years, but what is a government for? It is in office to look after the welfare of the nation as a whole. I hope that the Government will bear that in mind. Anything that it does is done in the interests of the people who put it on to the treasury bench of the Parliament. The position should be examined closely before one engages in eulogies. We have heard about the war service homes that have been provided, but for whom were they provided? They were provided for the men who risked their all, who went overseas and suffered privations in order to make our country safe. The provision of war service homes is in fulfilment of only one of the promises that the Government made to the electors.
In 1946 and 1948 the then Leader of the Australian Labour Party and Prime Minister of the Commonwealth, Ben Chifley, realized the danger of inflation and sought to procure alterations to the Constitution that would give the Commonwealth Government power to control inflation. We all remember the opposition that was shown to the granting of additional constitutional powers. The forces opposed to Labour did everything possible to have the referendum proposals defeated, and they succeeded. lt has been said that if an increase in the basic wage is granted this year there will be terrible repercussions upon the economy, but are we not anticipating? Who has said that there will be an increase in the basic wage? I think that the Government is anticipating in going before the Arbitration Commission to influence the judges against granting an increase, lt should have left those three responsible men, who are hearing the claim of the Australian Council of Trade Unions for an increase in the basic wage, to bring down their own judgment without government influence. Why oppose an increase in the basic wage on the basis that increased wages are a cause of inflation? I admit that in many cases increases in wages are added to the price of consumer goods, but is that always necessary? Is it not true that employers do not show very much opposition to an increase in the basic wage? I think that employers show only token opposition because they know that with every increase in the basic wage their margin of profit and their overall profits will increase.
One Government supporter said yesterday that he was appalled because employers did not oppose very strongly an increase in the basic wage. I reiterate that this is because employers know that every increase brings more profit into their own pockets. What does it matter how much a man receives in his pay envelope each week or fortnight? The important thing is what it will purchase. Any man with a family who receives the basic wage is going through more than a struggle to make ends meet. Why blame inflation on an increase in the basic wage? Such an increase may add some millions of pounds to our annual expenditure. A figure of £150,000,000 was mentioned. But let us look at some of the other causes of inflation. The increased cost of land has been mentioned by both Senator Kennelly and Senator Cameron. I know that in South Australia land which, five years ago, was bought for £360 is now being sold for £1,660 without the holder having done anything to improve it. How can the increase of the basic wage be blamed for the terrific price of land in Australia to-day? A young couple who want to establish a home have to pay almost onethird of the total estimated cost of the building before they can put a brick on the land. It cannot be said that the increase of the basic wage has caused land values to spiral. The price of land has increased throughout Australia. However, let us have a look at some of the other causes of inflation.
Senator Scott said that the working man was never better off than he is to-day. Although I was pleased to hear him say that, I point out that the working man obtains many of the amenities in his home by means of the poor man’s overdraft - hire purchase. In many instances, his wife has to go out to work to increase the family income, and so her children are not under her direct control until she returns home. References have been made to the seriousness of child delinquency and how it can be overcome. I believe that a factor contributing to child delinquency is the necessity for wives to take jobs in order to supplement their husbands’ incomes sufficiently to enable hire-purchase payments on amenities in the home to be made. The Labour Party is not opposed to hire purchase. What we do oppose, as has been stated many times previously in this chamber, is the imposition of high rates of interest on hire-purchase transactions.
I should like now to quote the views of Mr. Justice Foster, who was one of the adjudicators at the previous basic wage inquiry. In “ Facts and Figures “, No. 62, at page 31, His Honour is reported to have stated -
In an inflationary period, the wage received always lagged behind the cost of living and the standard awarded was eroded by price rises from the moment of its pronouncement . . . Price changes should be examined frequently and the wage altered accordingly, and that could readily be done by an index.
The facts and figures concerning basic wage increases over the years that were presented by my colleague, Senator Ridley, are very hard to rebut. I feel that his contribution to the debate has given us all food for thought. It should make us all realize that, as Mr. Justice Foster said, it is not an increase in wages that forces up the cost of living, but rather the increase of the cost of living that forces up wages.
It has been said that the economy of the country was never more buoyant than it is at the present time. If that is a fact, I feel that the wage-earners are entitled to receive a share of our supposed prosperity. I agree with Senator Anderson’s contention that the Government should, when framing its next Budget, make provision to improve the lot of taxpayers who have families to support. The family is a very important unit of the community, and it is time that more consideration was given to family men.
The Minister for National Development (Senator Spooner) has said that the Government has the confidence of the majority of the Australian people. I have before me figures which prove that, at the last general election, the majority of the electors of Australia did not cast their primary votes for the anti-Labour parties. In the election of the House of Representatives, the Liberal and Country parties received 46.41 per cent, of primary votes, compared with a combined Labour Party vote of 52.9 per cent.
– There was not a combined Labour Party.
– The other Labour Party received 9.3 per cent, of the votes. I believe that had it not been for the propaganda that was circulated, the misstatements that were made and the mudslinging that took place, those votes would have been cast for the Australian Labour Party.
– How many votes did the Australian Labour Party receive?
– We received 42.93 per cent, of the primary votes.
– But 46 per cent, is not a majority vote.
– I would say that a majority is 50.1 per cent. Let me quote the result of the voting for the Senate election. The Liberal and Country parties received 45.91 per cent. The Australian Labour Party received 42.78 per cent, of the votes and the other Labour party 8.42 per cent., making a grand total of 51.2 per cent.
– That is the combined total.
– Yes. Therefore, I feel that Senator Spooner’s statement was not a true reflection of the feeling of the people in Australia to-day. Despite the confidence that this Government has in itself, I feel that at the next general election the Australian Labour Party will be returned to the treasury bench.
We on this side of the chamber have always had the welfare of individuals at heart. It has been said during the course of this debate that the Australian Labour Party has never had any interest whatsoever in the primary producers. That statement also is untrue, because at all times the Australian Labour Party has recognized that Australia is a primary-producing country. The party has always recognized the primary producer as one of the most important units of our community.
This Government, which claims to have such a great interest in the primary producers, some time ago was approached by South Australia for assistance for droughtstricken farmers of that State who, during the last five years, have experienced three bad seasons.
– Which ones were they? Were there not two out of three?
– I said that there were three out of five, and I shall stick to that.
– Some one said that last year we had a bad season, although we had 60,000,000 bushels of grain.
– The point is that this Government refused to help the droughtstricken farmers of South Australia.
– That is not correct.
– I ask the honorable senator: What did this Government do to assist the farmers? Did it give them any financial assistance?
– It assisted them through the ordinary channels.
– The deputation that approached the Government was told that assistance would have to be sought from the State Government.
– That is quite right - through the ordinary channels.
– But because of the droughts that have occurred over the years, the South Australian Government has not the money to help the farmers. The Federal Government refused to assist when it was requested to do so.
Is the Australian Labour Party the big, bad monster that Government supporters would have the people of Australia believe it to be? Only recently, I undertook a tour of the south-east of the continent, and 1 found that feeling towards the Australian Labour Party is better now than it has been during the last fifteen years. I think that Labour enjoys the confidence of the people.
In my opinion, the basic wage increase is not to blame for the inflationary spiral. We should do well to examine the real causes of inflation. The Leader of the Opposition (Mr. Calwell) stated during a press interview this morning that he would assist the Government in any way he could to halt inflation. I ask for leave to continue my remarks at a later date.
Leave granted; debate adjourned.
Message received from the House of Representatives intimating that, in accordance with the provisions of the Public Accounts Committee Act 1951, Mr. Bland, a member of the House of Representatives, had been discharged from attendance on the Joint Committee of Public Accounts.
Senate adjourned at 5.30 p.m.
Cite as: Australia, Senate, Debates, 10 March 1960, viewed 22 October 2017, <http://historichansard.net/senate/1960/19600310_senate_23_s17/>.