Senate
16 March 1960

23rd Parliament · 2nd Session

  1. Senate
  2. 23rd Parliament
  3. 1960

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

page 163

QUESTION

CIVIL AVIATION

Senator McKENNA:
TASMANIA

– 1 direct a question to the Minister for Civil Aviation. Is he in a position to say whether the agreement respecting the exchange of aircraft between Trans-Australia Airlines and Ansett-A.N.A. will be tabled in the Senate?

Senator PALTRIDGE:
Minister for Civil Aviation · WESTERN AUSTRALIA · LP

– No, Sir, not yet, although I can tell the Leader of the Opposition that since last Thursday, when he put a question to me on this matter, I have discussed it with the chairmen of both organizations. One chairman holds the view that the matter is unusual and he had not expected that he would subsequently be asked to make public a document which he had regarded as private. After a further discussion which I had with him, he said, “ Well, as far as I am concerned, there is really nothing except a point of principle involved - nothing of a secret nature; but because of the unusualness of the request I want to discuss it with some of my fellow directors “. As soon as he has done that, I will acquaint the Senate with the result and if possible, as a result of his further discussion with his fellow directors, I will be pleased to table the agreement.

Senator O’BYRNE:
TASMANIA

– Will the Minister for Civil Aviation say whether it is a fact that Trans-Australia Airlines crews have been transfererd to Ansett-A.N.A. for the period of time that the Viscounts, which are involved in the cross-charter, are being run by Ansett-A.N.A., and also whether Ansett-A.N.A. crews have been transferred to T.A.A. to assist the training of pilots employed by T.A.A.? I would also like to ask the Minister whether it would be possible, in view of the fact that T.A.A. is under the expense of making its crews available to another organization, for T.A.A. to be given an opportunity to recoup its losses by going into the economy trade immediately and so get the full loading of which the public has been told DC6B aircraft are capable of carrying.

Senator PALTRIDGE:

– The honorable senator is right in his assumption that T.A.A. crews are in fact on loan to Ansett-A.N.A. and that Ansett-A.N.A. crews are in fact on loan to T.A.A., one for the purpose, as I understand it, of undergoing a conversion course on DC6B’s, and the other for the purpose of undergoing a conversion course on Viscounts. This is in no way an unusual happening. When aircraft are chartered from one company to another and the aircraft so chartered is strange to the airline chartering it, it is usually part of the arrangement that crews should go for the purpose of conducting what are called, I understand, conversion courses. Neither T.A.A. nor Ansett-A.N.A. will suffer financially as a result of these transfers. Wages are adjusted. The added cost to either airline is not a point that is raised at all.

page 163

QUESTION

AUSTRALIAN NATIONAL UNIVERSITY

Senator WRIGHT:
TASMANIA

– J wish to ask a question of the Minister representing the Prime Minister. It has reference to the welcome announcement, made some time ago, and repeated recently in the Governor-General’s Speech, that the Government has decided to associate the Australian National University with the Canberra University College in one institution. It will be remembered that the vote last year for the Department of Works contained two items, exceeding £100,000, for faculty buildings related to the Canberra University College. Can the Minister state whether those projects are being proceeded with or whether they are being deferred in view of the announcement which I have mentioned?

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

– I am not sufficiently conversant with the subject to be able to answer Senator Wright’s questions. 1 am aware that the Prime Minister hopes to introduce legislation on the matter before he leaves for overseas.

page 163

QUESTION

COOL STORES

Senator BENN:
QUEENSLAND

– I direct some questions to the Minister for Customs and Excise, who is the Minister in this chamber responsible for dealing with the affairs of the Commonwealth Scientific and Industrial Research Organization. I preface my question by saying that 1.700 bags of prime onions had to be destroyed in Brisbane in December last, and that Tasmania expects to have a near record apple harvest this season. Cool stores are essential in Australia to preserve foodstuffs such as meat, fruit and vegetables. My questions are: Has the Minister had an opportunity to examine the report, described as Bulletin No, 282, furnished by G M. Rostos of the C.S.I.R.O.? If he has, will he inform me in what States the 23 cool rooms studied by Mr, Rostos were situated? Is the Minister informed as to the adequacy of cool storage for fruit and vegetables? Will he consider asking the architects of the Department of Works to prepare, from the information contained in Mr. Rostos’s report, a handbook for use by builders, boards and authorities interested in the construction of cool stores?

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

– I had a cursory look at this bulletin, which is a survey of cool stores. I understood that the cool stores referred to in it were in New South Wales, Tasmania and Victoria. I should not have thought that it would bc necessary for the departmental architects to prepare a handbook on cool stores, based on this report. T would have thought that competent cool store architects would have been able to follow quite clearly Mr. Rostos’s report, because it is an excellent work. If the honorable senator is seeking something a little simpler, then I would refer him to the “ Food Preservation Quarterly “ of June, 1948, which contains an article by Mr. Rostos dealing with some aspects of the design of fruit cool stores. That article is more likely to be understood by laymen such as myself and the honorable senator. As for the remainder of the honorable senator’s question, if he will place it on the notice-paper I will obtain an answer direct from the Minister in charge of the Commonwealth Scientific Industrial Research Organization. This matter of preserving surplus foodstuffs is very important in a primary-producing country such as ours and is of great interest to primary producers.

page 164

QUESTION

PERTH AIRPORT

Senator CANT:
WESTERN AUSTRALIA

– I ask the Minister for Civil Aviation whether it is a fact that the runways at Perth Airport are being lengthened. If so, is it proposed to permit jet aircraft to use the lengthened runways?

Has the Minister considered the effect of the excessive noise that such aircraft would cause in a built-up area? If the excessive noise caused by jet aircraft has a detrimental effect on surrounding districts, what steps does the Government intend to take to compensate the residents of the district?

Senator PALTRIDGE:
LP

– The noise nuisance at Perth airport is. fortunately - I am sure that my friend from Western Australia will be pleased to hear this - much less than in many other cities. Land has been acquired which ensures that aircraft that take off from or land on either of the runways are, generally speaking, well above the nearest houses when in their vicinity, and so do not cause a great noise nuisance. Such nuisance as does occur generally results from wind conditions that are experienced on only a few occasions during the year. However, before extensions are undertaken at Perth airport a programme of acquisition is to be completed which will, with the exception of a very small number of habitations, remove almost altogether the nuisance about which the honorable senator feels so apprehensive.

page 164

QUESTION

BROADCASTING IN WESTERN AUSTRALIA

Senator TANGNEY:
WESTERN AUSTRALIA

– My question, which is directed to the Minister representing the Postmaster-General, deals with the provision of regional radio stations in Western Australia. Has any provision been made, or is any proposal under consideration, to establish a regional radio station, possibly on Mount Magnet, which would serve the Murchison district? Such a station would also serve northern outlying areas where at present radio reception is exceedingly poor.

Senator Sir WALTER COOPER:

– I understand that this matter of radio stations and radio sub-stations in Western Australia has been the subject of a great deal of discussion and experiment. I am not certain of the present position, but I know that a lot of important experimental work has been done in Western Australia to see whether improved radio facilities can be provided over a wide area. I will bring the honorable senator’s question to the notice of the POSt.masterGeneral. and let the honorable senator know just what is the position.

page 165

QUESTION

CIVIL AVIATION

Senator MARRIOTT:
TASMANIA

– I ask the

Minister for Civil Aviation: Did TransAustralia Airlines seek and gain permission to purchase twelve Fokker Friendship aircraft? Did T.A.A. then find that some of those aircraft were surplus to requirements? Did T.A.A. sell or charter any of those surplus aircraft to other Australian airlines? Did T.A.A. lend crews to other airlines to train crews for the companies purchasing the aircraft?

Senator PALTRIDGE:
LP

– Yes, with Government approval, Trans-Australia Airlines did buy twelve Fokker Friendship aircraft. The circumstances in which those aircraft were purchased were explained at length by me during the last session, and I do not want to occupy the time of the Senate now in repeating a lengthy story.

Senator Hannaford:

– It was a good deal.

Senator PALTRIDGE:

– As my friend, Senator Hannaford, has just said, it turned out to be quite a good deal from a national viewpoint. Subsequently, T.A.A. disposed, by charter or sale, of three of those aircraft. Following what I described earlier in reply to a question asked by Senator O’Byrne as being quite normal practice in such cases, T.A.A. undertook conversion courses for the pilots of the airline to which the aircraft were either chartered or sold. TransAustralia Airlines would have been compensated for the loss of time or any other costs involved, just as it is not standing out from any revenue duc to it as a result of the chartering of aircraft to AnsettA.N.A. in accordance with the recent crosscharter deal.

page 165

QUESTION

WAR SERVICE HOMES

Senator AYLETT:
TASMANIA

– I ask the Minister for Repatriation: What would be the position of a widow who, prior to the death of her husband, occupied, with him, a war service home before negotiations had terminated and the necessary signing of documents had been completed? 1 have in mind the position of a woman without any dependants, whose husband became ill and passed on and left her in occupation of the house. In view of the fact that she has not any dependants, would she be eligible to proceed with the purchase of the property?

Senator SPOONER:
LP

– 1 shall answer the question. I think the honorable senator would find that the War Service Homes Division would protect the position of the widow. It seems that Senator Aylett has a particular case in mind. If that is so, I invite him to see me about it.

page 165

QUESTION

RIVER MURRAY WATERS

Senator SPOONER:
LP

– In accordance with section 21 of the River Murray Waters Act 1915-58, I lay on the table of the Senate the following paper: -

River Murray Waters Act - Annual Report of the River Murray Commission, together with statements of gaugings and diversions, for year 1958-59.

Senator LAUGHT (South Australia) [3.191. - I move -

That the paper be printed.

I ask for leave to continue my remarks at a later stage.

Leave granted; debate adjourned.

page 165

SEARCH FOR OIL

Senator SPOONER:
Vice-President of the Executive Council and Minister for National Development · New South Wales · LP

– by leave - I am pleased to announce that the Commonwealth Government has decided to engage the Petroleum Institute of France to make a review of the petroleum possibilities of Australia. This review will be made in two stages. The first stage will consist of a general survey of the Australian sedimentary basins; the second, of more detailed examination of selected areas.

The making of a review of the kind proposed has been an objective of the Bureau of Mineral Resources for many years. Indeed, the bureau has made some progress with this review, but it has been apparent for some time past that, because of the continually increasing demands on the bureau, some unusual action would need to be taken if the review was to be completed in a reasonable time. Recruitment of an adequate number of experienced scientific officers for the purpose would have been virtually impossible. Moreover, it is considered that there are considerable advantages to be gained by employing such an experienced and successful organization as the Petroleum Institute of France.

The institute has been in existence for about sixteen years. It is an unusual organization, not only because it is concerned with all aspects of petroleum, from exploration to refining, but because it has three distinct functions: To teach, to do research, and to undertake investigations on a contract basis. An added attraction from our point of view is that the institute is advisory, not executive, and that it has no commercial interest in oil-field development.

The institute has had some striking successes in its petroleum investigations. These investigations are of two kinds. The first consists of a review of the petroleum geology of areas where a considerable amount of geological information has accumulated and where drilling has been done. The institute describes this kind of investigation as synthesis. The second kind of investigation consists of the reconnaissance of sedimentary basins about which only limited information is available and where little drilling has been done.

The institute has made syntheses in Tunisia, in the African French territories of Madagascar and Gabon; and within France, of Aquitaine, Savoy, Bresse and Jura. The results obtained in Gabon illustrate the contribution which can be made by re-interpretation and synthesis. The operating company, acting on the advice of the institute, completely re-orientated its prospecting, with considerable success. There are now four oil-fields in the territory which, in December, 1959, were producing at the rate of 15,000 barrels per day.

The institute has made reconnaissance investigations of the Paris Basin, the Limagne, the Rhone Corridor and the Sahara. The institute states that before the completion of its report on the Paris Basin the prospects of the basin for oil were regarded as negligible. The institute reached a different conclusion. It did not assess the possibilities as of the first order, but considered there was a real chance of success. There are now three producing oil-fields in the basin and prospecting operations cover virtually the whole of it.

Concerning the southern Sahara, the institute states -

We were able to establish the possibility of accumulation in the Palaeozoic. Above all, we were able to show that the strip north of the Hoggar, until then officially condemned, possessed, on the Contrary, possibilities which the accumulations of gas and oil discovered by the Company for Exploration and Development of Petroleum in the Sahara have fully confirmed. We were able to show, before the commencement of prospecting, that it was in areas so far neglected that prospecting should be undertaken.

So much for the record of the institute. But my officers are equally impressed by the scientific and systematic manner in which the institute goes about its work. Moreover, we appreciate that the institute sincerely desires to “ renew the confidence of friendly countries in the value of French thought “, that it desires “ the willing cooperation of our outside colleagues as an essential condition of accepting an assignment “, and is well aware that it “ requires their opinions and their active assistance for the actual performance of its operations “.

This is the basis on which the institute will be employed. It will work in the closest collaboration with the Bureau of Mineral Resources and, in individual States, with the officers of the Mines Departments. As its work develops, I hope also that all exploration companies will be prepared to make information available to the institute’s scientists and to enter into discussions with them.

The Government believes that the institute has something novel to contribute to oil exploration and that its engagement cannot fail to have a stimulating influence on the search for bil in Australia. A mission from the institute headed by Dr. Trumpy, the Director of its Bureau of Geological Studies, will arrive in Australia shortly arid will thereafter be engaged continuously for some months on the first stage of its assignment.

Senator McKENNA:
Leader of the Opposition · Tasmania

– by leave - I very cordially welcome the announcement that has just been made by Senator Spooner. I think ‘the Senate will recall that, down the years, I have been pressing the Government to take leadership in undertaking a complete and comprehensive survey of the sedimentary basins of Australia. The Opposition felt that the great difficulty was that the examination of the sedimentary basins, where alone oil may be found, had been left to the unco-ordinated activities of the oil exploration companies. That, in our opinion, did not constitute a scientific approach, nor was it the best way in which to deal with the problem.

It may be recalled that I argued that, despite the fact that this required specialized knowledge, the Opposition was confident that the necessary brains could be bought. I am surprised at the solution the Government has found for that. I do hope that all that has been said regarding the officers of the Petroleum Institute of France will be realized. I welcome them to this country with their very fine record of achievement, and I join with the Minister in trusting that they will be given the fullest co-operation not only by the Bureau of Mineral Resources, but also by everybody else concerned with the discovery of oil in Australia.

It is a matter which could revolutionize our economy and make an untold contribution to our security in this part of the world. I hope that the advent of the officers of the institute will mean one more determined effort to locate oil in this country. I trust that, in co-operation with our own officers, they may have the pleasure of leading Australia to the key to the formation of our sedimentary basins which, once found, will unlock all the doors in other sedimentary basins. I conclude, as I began, by saying that I very warmly welcome the Minister’s statement.

page 167

QUESTION

GOVERNOR-GENERAL’S SPEECH. ADDRESS-IN-REPLY

Debate resumed from 15th March (vide page 160), 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 been 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 of 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 with young families;

its action in lifting import restrictions with its accompanying threat to the employment of thousands of Australians and the security of Australian enterprises; and

its decision to ask the Arbitration Commission to reject the current application of the trade union movement for an increase in the basic wage “.

Senator LAUGHT:
South Australia

– Honorable senators may recall that last night, when speaking to the motion before the Senate, I asked them to set their sights high and to reject Labour’s amendment expressing no confidence in the Government, which is based on the Government’s alleged failure to halt inflation, and the Opposition’s claim that the Government did wrong in freeing certain imports from controls and in presenting its views to the Arbitration Commission in the hearing of the current basic wage application. I asked the Senate then, and I ask it now, to look ahead to the year 1970. In my concluding remarks last night, I directed attention to the exciting possibilities of 1970. At about that time we should be experiencing, in Australia, a high demand for consumer goods. There should be an increase of from 30 to 35 per cent. in the population. What is still more important is that there should be an increase of from 70 to 75 per cent. in the number of persons in the 15 to 24 years age-group. In other words, there should be between 70 and 75 per cent. more teenagers and young married persons in our population in 1970 than there are now. We could expect that period to be a wonderful era for commerce and industry. The work force should have increased by 33 per cent., and in the interim there are great possibilities for immigration. As I explained, the Minister for Immigration (Mr. Downer) has been untiring in his efforts to attract immigrants, particularly British immigrants.

I directed attention also to the rather dismal picture painted by Mr. Arthur Calwell, Leader of the Opposition in another place, in a television interview heard and seen by many persons in South Australia last Sunday night. I recall well the attitude that Mr. Calwell took and the remedies that he suggested. Foremost amongst his remedies were control of interest rates, control of hire purchase, the imposition of a new tax to be known as a capital gains tax, and price control. Despite the fact that several Labour governments in Australia have given away price control as impracticable he, the new Federal Labour leader, speaking for the whole of the Australian Labour Party, said that if Labour had power now it would institute rigorous price control. What concerned me more than anything else was Mr. Calwell’s idea of dividing Australia into a number of local areas, cutting away existing State boundaries and, in effect, having just municipalities and a unitary government. We, especially those of us from the smaller States, well know the vast power that would be wielded by the influences from Melbourne and Sydney in such an arrangement. The whole idea of federation could well be cut away if Labour had its way. Labour had its say through the mouth of Mr. Calwell on Sunday evening. So, Sir, I would like to look at the brighter side of the picture because I feel sure that the Senate will not accept the amendment to the Address-in-Reply that has been moved by the Deputy Leader of the Opposition (Senator Kennelly).

I was very interested to read recently an article in the “ Quarterly Review of the Australia and New Zealand Bank “, which stated that the Australian index of factory production showed a 2.7 per cent, rise in November. 1959. compared with production in October, 1959. The rise was 8 per cent, higher than a year earlier. The average for the first five months of factory production in 1959-60 is 9 per cent, higher than it was in the corresponding period of 1958-59. So, there is no foundation for this talk of gloom which has been presented by the Opposition in relation to these figures, which are very recent.

However, Sir, there was a great challenge to the Government to achieve great expansion in our economy to absorb all these new people to whom I referred last evening and earlier to-day. At the same time, I feel that by this absorption in gainful occupation we can improve our economic performance. We see a great interest in this country being evinced by people from overseas. New ideas are being introduced to Australia by the migrants and new ideas are being introduced also by firms and industries that are commencing here. The

Commonwealth Scientific and Industrial Research Organization is doing great things in the field of research. The universities all have their research departments and, of course, over the last six or seven years the Australian National University has been doing remarkable work in pure research.

We have before us in the Senate this month the report of the Australian Atomic Energy Commission, which shows that at Lucas Heights work is proceeding; and I suppose data is being distributed for use by Australian industries. The local production of isotopes has just commenced and we hope that their use in Australian industry will be stimulated. Then, of course, foundations are being laid to enable laboratory equipment to be made available to the large teaching high schools in Australia. I understand that it is expected that over £300,000 will be expended from a foundation created with money from industry to fit up physics and chemistry laboratories in independent schools in Australia. So there is a great surge forward being made at the present time at the university level, at the research university level, at the C.S.I. R.O. level, and even at the secondary school level. We confidently predict that this increase will take place and will be spurred on by the increased local demand that the increase of population will generate.

Our overseas trade position is, I think, satisfactory because there should be record wool production in Australia this year, as His Excellency’s Speech recorded. It is interesting to note that the wool market is on the move forward in favour of sellers. As a South Australian, it gives me great pleasure to know that despite the tremendously dry season that has been experienced in that State the fact that a large number of the sheep population has gone from South Australia has not been because of the death of the sheep - that is the destruction of the sheep through drought to any marked extent - but because of the fact that the sheep were able to be moved by vast road trains and sold, reasonably profitably, in the other States. The loss that would otherwise have occurred in South Australia has been considerably cushioned.

Sir. we can expect a great increase in population in Australia and a great increase of the teenage and the young married population in 1970. I would say: Let us look ahead just for a moment at the position as it will be then - as to-day we have forward planning - and not grizzle about a few little things that are occurring at the moment which cause some minor disquiet. Let us look ahead and plan ahead for the next ten years. Professor Downing, Research Professor in Economics at the University of Melbourne, said in a lecture before the Winter School of 1959 of the New South Wales branch of the Economic Society of Australia and New Zealand that we have prospects in 1970 of having an increase of population of from 25 per cent, to 30 per cent., a 33 per cent, increase of the work force, a 31 per cent, increase in productivity, and a 70 per cent, increase in the gross national productivity, and that productivity per head could well increase by 43 per cent. There would be. he predicts, an annual growth at the rate of 5i per cent. Half of this would be due to productivity, a quarter to natural increase, and a quarter to immigration. So, from the figures I have been able to find - I think the authority of Professor Downing is quite marked in Australia at the present time - this is what we ought to be able to look forward to, and we should set our sights accordingly high. In the 1950’s, one of the great things that inspired many people was the Snowy Mountains scheme, which was a physical manifestation of Australia’s intention to develop. I give the Labour Party credit for conceiving the scheme and drawing up the blue prints for it, but the present Government has pursued it with great vigour. I pay a tribute to the Leader of the Government in the Senate (Senator Spooner) who has worked untiringly for the fulfilment of the tasks that have been set. Indeed1, he is ahead of time in many of the tasks that have been planned. I believe that this great project has inspired private overseas investors to come to Australia and invest their money here. This great national project has done a great deal for Australia.

In the few minutes that are still available to me, I should like to outline to the Senate some of the things that are happening in South Australia today. I can speak with some authority about that State, which I represent in this chamber. I have moved through South Australia a good deal over the last twelve months. As a matter of fact I have travelled from as far north as Innamincka to as far south as Eight Mile Creek where it enters the Southern Ocean. I believe that the forward planning that is taking place in South Australia - I hope that similar planning is going on throughout Australia - is becoming most significant. As all honorable senators probably know, the Premier of South Australia is Sir Thomas Playford. During the last few weeks he has made regular broadcasts concerning projects that are planned in South Australia. I wish to mention them rather quickly. In Port Pirie, since 1889, there has been a vast accumulation of slag from the smelters. As a result of the encouragement that the State Government has given to Broken Hill Associated Smelters Proprietary Limited this slag - I understand it amounts to 5.000.000 tons - is to be treated. It is hoped that 800,000 tons of zinc will be produced from this waste material, accumulated since 1889. That will involve the building of furnaces costing £2,500.000. and a coke works is to be created at a cost of £750.000. It will involve also the duplication of the WhyallaMorgan pipeline, which brings water from the River Murray. We are hopeful that the increased economic importance of Port Pirie, wrapped up with Broken Hill, will result in the standardization of the railway between Broken Hill and Port Pirie. I give that project as an illustration of forward planning in South Australia. It is one of the ways in which South Australia plans to cope with the great and exciting surge of population that we can expect within ten years.

I pass to another matter of great importance, and I am glad that Senator Spooner is in the chamber to listen to what I have to say about it. He tabled in the Senate to-day a report of the River Murray Commission. From the point of view of South Australia, that is one of the most important reports that could be tabled in the Senate. It gave me great pleasure to move for the printing of the report, and I should like to discuss it further at a later time. I invite the attention of the Senate to a project that Sir Thomas Playford described in a broadcast to South Australians about three weeks ago. Some of our problems in South Australia arise from the fact that industry is developing so fast there. The fact that a Liberal government is in power, the existence of good conditions of employment and the quiet efficiency with which things are handled there are attracting industry in large measure, but that has brought with it the problem of finding sufficient water. Unless something is done in quite a big way, it is feared that in not less than ten years from now we may reach the limit of our assured water resources. It is feared that the diversions that are taking place in the Snowy Mountains area will have a marked effect on denying an adequate water supply to South Australia. I am not going to debate that subject, but I present that fear as a reasonable fear, in the light of the increased use that is being made, and will be made, for irrigation and other worthy objects, of the Murray and Murrumbidgee waters between their source and the boundaries of South Australia. South Australia has no water storage scheme of its own of any note on the Murray. Sir Thomas’ proposal, which he has already investigated, is that a dam costing approximately £9,000,000 be built near the borders of Victoria, New South Wales and South Australia. It would form a lake approximately 49 miles long. Within the borders of South Australia, vast quantities of water would be impounded. The dam would impound all the water from the Darling, the Murrumbidgee and the Murray which reaches South Australia.

Sir Thomas, in his broadcast, indicated that the average flow into South Australia of the river Murray waters over the last 21 years was approximately 9,000,000 acre feet a year. The forward planning that has been done by his engineering chief indicates that in the next 21 years that flow will fall to 6,000,000 acre feet a year, on an average. So honorable senators will see that the problem is, to his way of thinking, a real one, and I think that, as a South Australian senator, I should present it to the Senate. Consequently, I ask that when this matter is brought forward in the official manner, the Leader of the Government in the Senate, who is the Minister for National Development, will give it very serious consideration.

As I have said, in South Australia other great forward planning is taking place. There is the great development near Port Adelaide by the Imperial Chemical In dustries organization where it is hoped that a vast reclaimed area will be used to produce soda ash, which, I understand, can be used in the aluminium industry. A large oil refinery to be built near Adelaide will require a lot of water. Of course, as the population of South Australia increases - it could well pass the 1,000,000 mark within a few months from now - there will be a much greater demand for water. By and large, there are not many flats in South Australia, so the existence of many more gardens, with lawns, &c, will create a big demand for water. That is a problem for South Australia.

Then there is the Greater Port Adelaide scheme, which envisages the building of new wharfs and the reclaiming of land by means of moving sand from one side of the river to the other, so that areas for industry can be established within 8 or 9 miles of Adelaide. I give these as instances - almost taken at random - of what is actually planned for South Australia in the next ten years. I emphasize the importance of this forward planning, and I suggest that we should work in a federal partnership with South Australia in these developments.

What have we heard from the Opposition with regard to the future development of South Australia? What has the Opposition told us about the progress of Australia in the 1960’s? I feel that the Opposition is. misguided in presenting its amendment, lt has suggested a capital gains tax. It has made suggestions with regard to the profits of General Motors-Holden’s, and Mr. Calwell has suggested abolishing the Australian Broadcasting Commission and putting broadcasting under a Minister for Broadcasting. These ideas are not forward planning ideas. They are the ideas of the 1940’s, when bank nationalization and nationalization of airways were being attempted in this country. We must look to the future - the 1960’s and 1970’s - when we hope that Australia will develop under a system of free enterprise.

I have been presenting some aspects of South Australian life as I see it. I congratulate the Government on the job it is doing. I ask it to pay particular attention to the problems of South Australia in considering the matters that come before it from time to time. I ask the Government to pay particular attention to those problems when Sir Thomas Playford arrives to-morrow to discuss the proposed Murray dam.

Senator O’BYRNE:
Tasmania

.- The Senate has before it a motion in which we desire to express our loyalty to our Most Gracious Sovereign, and to thank His Excellency, the Governor-General, for the Speech that he has been pleased to address to Parliament. To that motion the Opposition has proposed an amendment in the following terms: -

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 of 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 with young families;

Its action in lifting import restrictions with its accompanying threat to the employment of thousands of Australians and the security of Australian enterprises;

Its decision to ask the Arbitration Commission to reject the current application of the trade union movement for an increase in the basic wage.

The Governor-General, in his opening words, said that Parliament was gathered together to deal with matters affecting the well-being and advancement of the Australian nation. If ever there has been a time when the well-being and advancement of the Australian nation is jeopardized, it is the present time, when the forces of inflation are not only creeping upon us, but are malignant and cancerous in the body economic.

Senator Laught spoke of the great future of Australia, and said that the Opposition was inclined to take the short-term view. I submit to Senator Laught that the main fault that the people of Australia find with the present Government is that it has no longterm view. It is a spasmodic Government with a spasmodic policy. During the last five or six years we have seen many changes in the Government’s policies. We have seen many changes of face by Government supporters. We have had ponderous pronouncements by the Prime Minister (Mr. Menzies) about the prosperity of Australia, to be followed in his next breath by warnings of the inflationary tendencies. But for the benefit of Senator Laught, and particularly for the benefit of the two Western Australian Country Party senators, I should like to quote from the “Farmers Weekly” of Thursday, 10th March last. This is the official organ of the Farmers’ Union of Western Australia, and the article in question reads -

When members of the Federal Parliament reassemble next week they will have to face up to the problems associated with the increasing threat to the stability of our exporting primary producer industries, and our entire national economy, created by the rapidly intensifying inflationary spiral–

Senator Wade:

– That is what the Government is doing.

Senator O’BYRNE:

– It continues -

Pious pronouncements, abstract proposals and belated appeals by Government leaders to “John Citizen “ will not be sufficient.

Senator Wade interjected and said that the Government was meeting the situation, but as usual the Government is giving us words, not deeds. Later in my speech I will develop the theme that is running all the way through the Governor-General’s Speech of the Government’s ability to lift production. But it is all words and the graph of actual deeds is falling away very rapidly. The article that I am quoting continues -

Protected and monopoly industrial and commercial interests sheltered from reasonable competition by the imposition of excessive and prohibitive tariffs now generally apply the new practice of merely passing on cost increases through higher prices and charges in order to maintain determined profit margins. To these interests the sanctity of profit margins is paramount. In these circumstances the spiral of inflation will not only continue but will inevitably, and with increasing pace, race to heights ending in economic chaos for primary producers, small investors and those on fixed incomes. There needs to be another look at our tariffs, this time from the angle of what our exporting industries - the primary producer industries - can afford to pay for the needed capital goods in order to maintain and expand, on an economic basis, their operations which are so vital to the nation.

That article expresses the feelings of the primary producer throughout Australia. In the last few days Mr. R. W. C. Anderson, director of the Associated Chambers of Manufactures, said -

The import situation was explosive. Imports for February, a short trading month of 21 working days, had been £78,500,000.

On this figure Australia was annually importing goods worth more than £940,000,000 - before import licensing was virtually abandoned.

If the £20.000,000 spent annually on international aircraft were added, the import bill would be about £960,000,000- the rate when SO per cent, of imports were “ free “.

More than 90 per cent, of imports were now “ free “, and when timber was freed on 1st April the percentage would be even higher.

If imports arrive at the rate of £1,000,000,000 a year (a very conservative estimate) Australia would need to finance an international payments bill of more than £1,200,000,000 after freight and insurance payments were added.

Senator Wright:

– Does not Mr. Anderson think that each importer will have the responsibility of providing credit to pay for his imports?

Senator O’BYRNE:

– Senator Wright should be an expert on the economic cycle of the capitalist system. He subscribes to the principle of free enterprise. He subscribes to the present rat race to get in for one’s cut and let the devil take the hindmost. Where we have no plan or pattern and where every man gets in for his cut, we must take the consequences. Mr. Anderson concluded -

How Australia can do this without steadily running down its international reserves is difficult to see.

It may be argued that this is what international reserves are for, but this is not so.

Reserves are for emergency drawings and an extraordinary situation.

They are not designed to be drawn against steadily.

Senator Hannaford:

– He is biased.

Senator O’BYRNE:

– Because he is not a yes-man for the present Government? One of our great troubles to-day is that the Government is surrounded by too many yesmen who have vested interests and they want to see the Government protect vested interests, monopolies and cartels.

At this stage I want to join with other honorable senators in an expression of loyalty to Her Majesty. I also wish to congratulate Her Majesty on the birth of a son and to wish both of them every happiness and good health in the future.

I should like to refer also to the retirement from political life of a very distinguished statesman in the person of the ex-Leader of the Opposition, Dr. Evatt. 1 should like to place on record the fact that I personally, other members of the Australian Labour Party and I am sure the great majority of the Australian people, appreciate the very great service that Dr.

Evatt has rendered to Australia in so many different fields. It is a great misfortune that many of our best men have had to wait almost until their death notices have appeared in big black print in the press before their qualities have been recognized. I wish to express here and now the view that Dr. Evatt, who has been appointed Chief Justice of the Supreme Court of New South Wales, has left behind him in the

Federal Parliament-

Senator Wright:

– I rise to a point of order. I submit that Senator O’Byrne is out of order in referring to an occupant of judicial office other than during a debate on a substantive motion affecting that person.

The ACTING DEPUTY PRESIDENT (Senator Pearson). - Order! In my opinion. Senator O’Byrne is in order. He is not criticizing Dr. Evatt in his capacity as a judge.

Senator O’BYRNE:

– Having been rudely interrupted by the eminent lawyer from Tasmania who is able to wield great influence in the courts of that State, let me say that perhaps in the dim, distant future some one - I do not know who - will rise and speak in terms of appreciation about Senator Wright. All things are possible in this world.

The monumental work of Dr. Evatt in the parliamentary and international spheres will be of lasting benefit to Australia. In the parliamentary field he displayed the breadth of vision and thought that is so necessary in any approach to the confusion which exists in the world. The political pygmies who repeatedly attacked this great ex-leader of the Labour Party and who used every subterfuge and ruse to try to discredit him in that high office have only shown themselves to have been actuated by a form of jealousy. I wish Dr. Evatt a long, happy and contented period of office in his present exalted position. He will bring great credit to himself and the New South Wales judiciary as a whole.

His Excellency the Governor-General, in his Speech, referred to inflationary tendencies in the economy and said that the Government will give consideration to legislation to protect and strengthen free enterprise against the development of tendencies to monopoly and restrictive practices in commerce and industry. Senator

Laught painted a picture to show there was nothing wrong with the Australian economy. It is my firm opinion that the hue and cry about inflation being caused by wage increases is a calculated and premeditated attempt to divert the thoughts of the public from the- errors of this Government, and to try to build up public opinion against the claim at present before the Commonwealth Conciliation and Arbitration Commission for an increase in the basic wage.

Supporters of the Government argue that wage increases are the cause of inflation. When inflationary tendencies have emerged in the past, the Government has been very quick to blame the just wage demands of the working people. The Prime Minister (Mr. Menzies) became acutely aware of the situation only recently when he suddenly found that he was compelled to pay 29 permanent heads of departments in the Public Service an increase of nearly £18 a week. When we compare that increase with the meagre few shillings recently awarded to tradesmen as an increase in margins, we pause to consider just what encouragement we are giving to the youth of this country to become skilled artisans and tradesmen.

A very important principle is involved. The terms of the judgment of the Commonwealth Arbitration Commission in the recent margins case are well known to us all. The increase was granted after the unions had proved their case. They had to show that prices had risen and that the cost of food, clothing, rent and the other commitments of family life was such that an increase was justified. Government supporters are adopting a very unfair attitude, therefore, when they attack the wage-earner for applying for a higher basic wage, and when they attack the commission for granting increases. I repeat that wage increases are granted only after the unions have proved their case. Not a week passes without the price of some essential commodity or service having risen. Recently, in New South Wales the price of eggs increased by 6d. a dozen. In Victoria, rail passenger fares have increased by 10 per cent., and freights are expected to rise by Ti per cent. In most of the eastern States steak is retailing at between 6s. and 10s. per lb., and even more for special cuts. Australian butter .s selling at 2s. 6d. per lb. in London, but it costs about 4s. per lb. on the home market. Furniture prices are up by 10 per cent, on 1959 prices. The building industry in both Sydney and Melbourne is now calculating the price of an ordinary home on a base figure of at least £559 a square, as against £390 a square when this Government took office. We find in the building industry a tendency, when builders are making out estimates of costs and quantities, to add so much for contingencies. This practice has an inflationary effect and is reflected in the higher cost of building, which, in turn, is reflected in higher rents, and so the inflationary trend continues.

During the last twelve months we have seen a very rapid rise in the volume of profits of the large concerns that are dominating Australia’s industrial and financial life. We have only to look at the pages of the daily newspapers to see that, despite the loud claims that are made about the effect of increased wages, profits have never been higher. Company reports and balance-sheets show continuing increases of profits. There are take-overs and manipulation of share capital to hide the true position of certain companies, without any attempt by the Government to challenge such actions. Profits are reaching staggering heights. Their effect on our economic life far outstrips that of the small increases of wages and margins that are granted.

His Excellency the Governor-General, during the course of his Speech, said -

The development of tendencies to monopoly and restrictive practices in commerce and industry has engaged the attention of the Government which will give consideration to legislation to protect and strengthen free enterprise against such a development.

I do not know how long it will take for the people of Australia to appreciate that a situation such as that which exists at present is inevitable with the economic system that we have. We see to-day another turn of the wheel. I shall never tire of repeating that, with our present economic system, we can have four phases. First, we can have a boom; secondly, we can have a bust; thirdly, a depression; and fourthly, a war. We have a war, and then we have a period or so-called prosperity, or a boom; then there is a slide downhill to a depression, and then we have another war. The truth is that we cannot afford to have a war. We know, of course, that wars seldom profit any one. As has been well said, a war represents the failure of governments to handle their affairs on an amicable basis.

When are we going to do away with conditions which permit the stupid wastefulness of booms and the inflation which goes with them, depriving of their rights sections of the community who were provident in earlier years, such as those who paid into superannuation funds, thinking that ten, twelve or fifteen units of superannuation would give them security in their old age? To-day, those people have become the new poor. We know that if a married couple who are pensioners are able to work they may have a combined income of up to £16 10s. a week, but there are many people who saved during their working life to contribute to an annuity or to a superannuation fund and who now receive less than £16 10s. a week. The existence of the means test deprives them of eligibility for social service benefits. There, we see how boom conditions unfairly deprive people of their just rights. I have not noticed very much action on the part of the Government to rectify that position.

Stock exchange reports featured in the financial columns of the newspapers indicate that fantastic things are being done in the commercial world, lt is obvious that our economic conditions favour the bulls and the bears, not only of the stock exchange but also those involved in take-overs and monopolies. Because of the rapacity of the self-seekers and the monopolists, we are finding great difficulty in selling our goods on the markets of the world. We just cannot afford to sit down and allow our export markets to dwindle. Of overwhelming economic importance to us is the fact that we are being challenged by the highly organized economies of the Eastern bloc of nations. Those nations are entering markets that were traditionally ours. They are exporting goods that are evidently of a quality equal to Australian goods, and are under-cutting us.

I cannot say how we should cope with this situation, but I say that the Government, has missed a golden opportunity to establish the Australian nation as a bulwark in South-East Asia and in the southern hemi sphere. It has failed to establish a stable economy, with true values and conditions under which investors from other parts of the world could apply themselves to the pioneering work that is still to be done, to opening up and developing our natural resources and thereby enabling us to compete with other countries on the markets of the world. Unfortunately, this Government has lost us that wonderful opportunity. There has been no move at all on its part to instil in the minds and hearts of the Australian people a national purpose, a reason for their existence as a nation and an appreciation of their position in relation to the rest of the world.

Senator Wade:

– That is a pretty sad commentary on the Australian population.

Senator O’BYRNE:

– It is a sad commentary on Australian leadership over the last ten years, and on our facilities for the dissemination of information. We never seem to have given to us, either through the press, over the radio or on television, any outline of a definite national purpose. Certainly, we do not get any lead from cur Government. All we get from it is a continual emphasis on the unbridled and undisciplined right of private enterprise to exploit the country. Under this Government, the law of the economic jungle obtains.

I put it to honorable senators that the economic situation is critical, that some measures will have to be taken to replace it on the rails. Australia is at the crossroads and we must be prepared to face up to the world’s situation; we must be prepared to fight at the coming summit conference for disarmament, world peace, coexistence amongst nations and against the rights of so-called private enterprise to enjoy protected competition and the benefit of government-subsidized competition. We must be prepared to do our utmost to unite our people in the common cause of advancing Australia and its people’s welfare, and of ensuring that every man shall get his fair share of the productivity of this country; we must restrain present so-called business in its undisciplined, rapacious pursuit of private profit to the detriment of the people of the country. I emphasize to honorable senators that now is the time for re-thinking, for re-orientating our position in the world. It is still not too late, but if we allow the present position to continue lor much longer we shall have much to answer for to future generations.

Senator WEDGWOOD:
Victoria

. - I rise to support the motion for the adoption of the Address-in-Reply to the Speech delivered by the Governor-General and to oppose the amendment. I join with other honorable senators in congratulating and welcoming our new Governor-General, His Excellency Viscount Dunrossil, and Viscountess Dunrossil, and in expressing the wish that their stay in Australia will be both >happy and beneficial to them as I believe it will be to Australia and the Australian people.

His ‘Excellency, in his Speech, referred to the birth of a second son to Her Most Gracious Majesty the Queen. We again affirm our loyalty to Her Majesty, and our heartfelt good wishes go out to her and to the young prince. This baby prince strengthens the line of succession to the Throne and provides yet another link in an hereditary monarchy which we fervently pray will remain steadfast and constant during the turbulence and changes in this twentieth century.

I should like to pay tribute to the work of a former Victorian colleague, the former Minister for External Affairs, the Right Honorable R. G. Casey, upon whom has been conferred the signal distinction of life peerage. Lord Casey’s record of public service won for him the respect and admiration of all people in the free world. Whilst we .regret his resignation from this Parliament, we know that his knowledge and .experience will be available always in the service of Australia and the Commonwealth of Nations. I .am sure that all women would wish me to offer very deep appreciation to Lady Casey for the splendid1 work she has done, first, as the wife of her distinguished husband, and, secondly, on her own account in her efforts at all times to advance the rights of women, especially in those parts of <the world where advantages to women have been slow in coming.

Senator O’Byrne referred to Jack of purpose in Australia, and on the part of the Government in particular. I remind him that in His Excellency’s Speech there is mention of Australia’s participation in world affairs, of the proposed summit conference and what is hoped from it, of

Australia’s continuing and expanding help to Asian countries, of what we are doing to promote overseas trade and of a number of interrelated subjects, all of which indicate clearly that Australia is thinking along the right lines. Broadly, the Speech outlines the earnest consideration the Government is giving to finding a solution of the many problems that beset the world, especially those confronting us at home and abroad. A sober warning is given that trends in the economy are causing concern and that certain measures are being taken to counter the inflationary pressures that are developing so rapidly. This warning has been met with the usual political shamfighting by the Opposition. Honorable senators opposite have attacked the Government heatedly but have shown very little appreciation of the matters at stake. They know as well as any one else does that Australia’s prosperity depends upon the growth of her export income and that inflation is inevitable if wages, salaries and incomes rise faster than the productivity of the community.

Senator O’Byrne was very critical of the Prime Minister’s statement about prosperity in Australia but, strangely enough, his own leader seems to agree with that .statement because, in a television interview last Sunday night, Mr. Calwell admitted that Australia was the best place in the world for the investment of overseas capital. Surely, that is an indication of the solid1 growth of prosperity in Australia.

The Leader of the Government in the Senate (Senator Spooner) made a very thoughtful contribution on the impact of inflation and Australia’s prospects of increasing her export income. He emphasized the urgency -of holding down costs. He quoted statistics which proved that Australia has been more successful than many other countries in holding down prices despite the fact that our rate of national development has been much greater than that of .any other country. The Australian Labour Party is pinning its case on restraining inflation to sweeping changes in the Australian Constitution; but I think Senator Wright will agree when I say that would be a very lengthy and very inconclusive proceeding. The Government proposes acting with the real courage it has displayed on many previous occasions. Senator O’Byrne said that the Government had taken different courses of action from time to time. Of course, it has. But it has taken a different course because it was necessary to meet particular circumstances. On this occasion, the Government has announced that it proposes to follow orthodox measures for restraining inflation. As any one who has any knowledge of economics at all well knows, those measures are to control bank lending, avoid deficit finance, lift certain controls on imports and to intervene in the current basic wage case, not for the purpose of suggesting that there should not be increases in wages but rather that the Australian economy should first be allowed to digest the recent increases in the basic wage and certain margins.

Time does not permit of my making more than passing reference to three matters of particular importance in His Excellency’s Speech. These are the review of our taxation laws, the very urgent need to develop the north-west of Australia, and the need for an overhaul of our pensions system, particularly in relation to the application of the means test. I hope that the Government will proceed with those matters as quickly as it possibly can.

I should like to refer to one other matter in His Excellency’s Speech that interested me greatly. He said that the Government was considering the report of the Boyer committee on Commonwealth Public Service recruitment, and that legislation would be introduced to permit greater flexibility in meeting present and future recruitment needs. This report was presented to the Government on 21st November, 1958. Shortly after its tabling, I directed attention to paragraphs 236-247 as they applied to the employment of married women in the Public Service. As is well known, Australia is one of the last countries to retain the marriage bar against women public servants. I shall not deal with the relevant sections of the act but I remind the Senate that the Boyer committee recommended the repeal of these provisions which it said were anachronistic. It went further and said that limitation upon the employment of women, rather than such employment itself, should be exceptional. The committee also recommended that consideration be given to amending those provisions of the Commonwealth Superannuation Act that denied superannuation rights to married women. These provisions abrogate the superannuation rights of women officers upon their marriage, even if the Public Service Board decides to continue them in employment. I do hope that when the Government is overhauling the legislation that applies to the Public Service it will ensure that these injustices are remedied.

The Boyer committee also made a number of valuable recommendations in paragraphs 248-253 of its report under the heading, “ Physically Handicapped “. An extraordinary situation exists in this regard because, through the rehabilitation services that were referred to by my colleague, Senator Dame Annabelle Rankin, the Commonwealth Government provides training specially designed to rehabilitate physically handicapped persons and to equip them to take their place in life. The Government makes a special appeal to employers in industry to find positions for physically handicapped persons who have been specially trained but, oddly enough, the Public Service Act is so inflexible as to limit opportunities for their employment and to deprive many of them of promotion.

I should like to cite as an example one case that I know very well and that illustrates exactly what I mean. It relates to a young woman who, in her intermediate year at school, contracted poliomyelitis. After two years under the supervision of a correspondence school she matriculated and entered the University of Melbourne to do an honours course in pure English. She obtained the degree of Bachelor of Arts with Honours. She then travelled overseas for twelve months and, on her return, sought employment in the Public Service. After a struggle, she was appointed to a clerical position in the imperial pensions section of the Department of Social Services. She then applied for gazettal as a permanent officer. After she appeared before a Commonwealth Medical Officer, her application was rejected. She appealed, but the appeal was not allowed.

Here we have a young woman whose disability, in the opinion of a very well known orthopaedic surgeon, will in no way preclude her doing the work she is required to do, yet she is debarred from holding a permanent position in the Public Service and from earning for herself the promotion merited by her determination and her courage in overcoming almost insurmountable difficulties. I hope, therefore, that the Government will give every consideration to the recommendations of the Boyer committee that cover such cases and difficulties in relation to superannuation and contributions to the Provident Account. I believe that the Government has an obligation to offer Public Service employment to persons who have qualified themselves for such employment, but have had the misfortune to suffer disabilities such as the one I have mentioned, and are thus unable to pass a medical examination.

Another matter that T think is worthy of Government attention is the dramatic change that has taken place in the pattern of employment of women in recent years and the problems associated with it. This was the subject of discussion at a meeting held in Geneva from 12th to 16th October, last year. Although nineteen countries participated in the discussions, Australia was not listed amongst the countries that sent delegations, and I understand that it had no representation at government, employer or employee level. That is unfortunate. Whenever discussions on an international level are taking place, Australia should have full representation.

One of the great difficulties that beset any person who wishes to arrive at a factual assessment of the position of women in the work force is the absence of any coordinated channel of information. This information is supplied in many countries by women’s bureaux inside departments of labour. These bureaux are responsible for formulating standards and policies affecting the welfare of all women wage-earners, improving their working conditions, increasing their efficiency, and advancing their opportunities of profitable employment. Of all these bureaux, the United States women’s bureau appears to have been longest in existence. It was established to deal with women in industry in 1918, and it was made permanent in 1920 by congressional act. It concerns itself with women in all fields of employment cr seeking employment, including the girl in her first joh, the professional woman, the older woman, and particularly the woman who is both home-maker and wage-earner. The United States of America places such importance on these bureaux and on the work they do that in 1957 the director of the United

States bureau was appointed to the position of Assistant to the Secretary for Labour. Published leaflets - I have some of them here, Sir - are available to show what is being done in the field of employment for women in the United States of America. They refer to the minimum wage of women workers, equal pay for women and to what is new about hiring older women. I am quoting these because I believe they fill a need that exists in Australia for statistical data about women in the labour force in this country.

The Canadian bureau was set up in 1954. The objects of that bureau were listed as being the promotion of a wider understanding of the role and contribution of women in the labour force, and to advance opportunities in employment so as to enable women to make a more effective contribution to the development of Canada. 1 would imagine that if the Canadian Government believed that it was advantageous to set up such a bureau to enable Canadian women to make a more effective contribution to the development of Canada, that need exists in Australia which has more developmental problems than Canada. The functions of the Canadian bureau are substantially the same as those of the United States bureau. It also provides special publications such as I have just indicated. One of the very important features in some of them is vocational guidance for girls and women. Vocational guidance for girls and women is entirely different from that which is required for boys and men because, as we all know, the latter are trained to hold positions throughout their adult life, whereas the life of an average woman is divided into three phases. The first phase comprises education, training, some work and then, generally speaking, marriage. The second phase is when she is devoting all her time to home making and family raising. If women enter the work force in those years it is usually to do part-time or intermittent work, unless they are among those most unfortunate women of whom there are far too many - the neglected wives - who are forced out into the labour market to support their families. The third phase in the working life of a woman - this goes for women who are employed in industry and professional women - is when her home responsibilities become less demanding and allow her to go back into the labour force. It is true to say that there are few women who go through their working life without having an interruption at some time or other; even professional women leave their professions for a time and return to them later.

As the years of participation by women in the work force are increasing, so is the necessity to study their vocational qualifications. One matter that I feel to be of particular importance is the interest that is taken in the problems of home-making services. It is interesting to recall that of all the inquiries that pass through the Canadian bureau, in particular - this may apply in other countries of the world, also - the largest number is made by the working mother who is concerned with the provision of facilities for the care of her children. The very important question of equal pay ranks second in Canada. I think that this shows the need that exists for bureaux of the kind that have been established in these other countries to provide assistance to women. In the United Kingdom there is a women’s consultative committee. That committee consists of women with wide and varied public interests, and they are called upon to advise the Minister on questions of employment policy relating to women. The committee meets under the chairmanship of the Parliamentary Secretary.

So, Sir, I would just like again to say that I believe the time has come when Australia should consider the establishment of bureaux or a consultative committee - I do not mind which. I believe that such bureaux should be charged with the responsibility of performing the same functions as are carried out by them in other countries of the world. As well as giving information and assistance on a local level they would also be able to advise delegates who attend international conferences. The absence of detailed data on the work force of Australian women in industry, and in the Commonwealth and State public services, places women delegates at a considerable disadvantage when they travel overseas to represent their country and are called upon to participate in international discussions. Therefore, Sir. for these reasons I hope hat the Government wilL give some attention to the matters I have raised. As I said before, there are many others contained in the Speech of His Excellency which I believe are worthy of mention. I again congratulate the Government on having taken steps to correct the inflationary pressures that are becoming so apparent in the community. I congratulate the mover and the seconder of the motion, which I fully support, and I oppose the amendment.

Senator SHEEHAN:
Victoria

.- Unlike Senator Wedgwood, I rise to support the amendment. But let me say at the outset, Mr. President, that I heartily support much of the matter that she dealt with during her speech. I regret very much that, due to the procrastination of the present Government, greater progress has not been made in regard to the very important subjects to which the honorable senator addressed herself. I would suggest that she and any of her colleagues who think along the same lines use every endeavour, in their party meetings and political organizations, to bring pressure to bear to galvanize this Government of procrastination into taking action to remove the anomolies of which she has spoken. I will be pleased if they succeed.

The motion before the Chair at the moment is a motion for the adoption of the Address-in-Reply, in which we thank His Excellency the Governor-General for attending here and delivering his Speech to us. I agree with what has been said by previous speakers about the thanks that we tender to His Excellency and the loyal greetings that are contained in the proposed Address-in-Reply. However, I feel that honorable senators who had the opportunity to hear the speeches delivered by previous holders of the office of GovernorGeneral were very disappointed at the paucity of the information given in this Speech. When I say that, of course, I cast no- reflection upon the gentleman who now holds the high office of Governor-General, because we all know that he came to the Parliament and delivered a speech prepared for him by his advisers - by the ministry of the day. Honorable senators and the nation at large expect, when such a speech is delivered, to receive an indication of what the Government regards as the most important problems confronting the people. They expect also that during the course of the speech there will be unfolded to the Parliament and the nation proposals for solving those problems, and that an indication will be given of the order in which it is proposed to deal with the problems.

What have we heard in this Speech? Have we heard any proposals to solve the great problems that confront this country? Not at all. lt has been left to Senator Kennelly, the Deputy Leader of the Opposition in this chamber, and to Mr. Calwell, our leader in another place, to direct attention to the very important problems that will confront us in the immediate future. The Opposition moved an amendment to the AddressinReply. As amended, it expresses our thanks for the Speech delivered by the Governor-General, but draws attention to very important matters. The Opposition has attacked the Government for failing to advise His Excellency that there was need to deal with the great problem of inflation, for its precipitate action in withdrawing many import licensing restrictions, and for appearing before the Conciliation and Arbitration Commission in an attempt to prevent the working class of this country from regaining some of the purchasing power that they have lost over the years. On these three points the Opposition expresses grave concern. I am pleased to support the amendment that was so ably moved.

Let us consider the question of inflation, which has been paramount in the discussions that have taken place, not only in this chamber, but also in another place. Every one appreciates the importance of this problem to the Australian economy. The Prime Minister (Mr. Menzies) recently, when attending a conference of the International Committee of Scientific Management, drew attention to the fact that if inflation were left unchallenged, it could bring about a national disaster. However, what else did he do? He did not offer any solution other than a pious pleading to the racketeers and profiteers of this country to go a little more quietly and not be so avaricious. He pleaded quietly, in that very fine style of which he is capable when speaking to a receptive audience. He said, in effect, “You must go a little more quietly; you must not be as avaricious as you have been in the past. This must be a community effort.” He indicated that some of our exporting industries - the smaller but not insignificant industries - were feeling the pinch and were apprehensive. He said in addition that our great exporting industries, such as the wheat and wool industries, might also have some qualms about the position which has arisen.

Mr. Menzies was not alone in his fear about our primary industries. Very rapidly, corroboration came from Mr. Falkiner, the president of the New South Wales Sheepbreeders Association, a gentleman who was quoted, I think, by either the mover or the seconder of the motion we are discussing. He drew attention to what was likely to happen if inflation were allowed to continue uncontrolled. He said that many of the smaller people engaged in primary production would face ruination. Any one who has studied the position knows that the great percentage of wool-growers are small men, who have only a few thousand sheep. They are the ones who are in danger.

A warning also came from the dairying industry very quickly afterwards. Mr. Harvard, I think, drew attention to the plight of the dairying industry and suggested that it should be consulted if any efforts were made either to cure this problem or to bring in some palliative. There is great apprehension amongst primary producers and workers - the two sections of the community that have mostly to bear the impact of inflation, the two sections of the community that are least able to resist the effects of inflation. Although these two sections have this fear, very little reference has been made to this problem by Government spokesmen in the course of the discussions in this and in another chamber.

The Treasurer (Mr. Harold Holt), when speaking in Melbourne, dismissed the problem as being something in the nature of an attack of measles. I think the usual remedy for- measles is to go to bed and keep “warm. That is the advice generally given to children who contract measles. I do not know how the Treasurer thought the people who are interested in our economy could take time off to go to bed and keep themselves warm. His remarks typify the attitude of the people who are responsible for guiding this nation, an attitude of laisser-faire, of let things go and they will be all right. His remarks highlight the belief that if only the worker would keep away from the Arbitration Commission, if only he would take a little less money for his labour and if he would accept a lower standard of living things would be all right. That would appear to be the attitude of this Government.

Yesterday’s Melbourne “ Age “ reported that a Mr. Aird had appeared before the Conciliation and Arbitration Commission on behalf of the private employers. He said that the employers claimed that the tribunal, because of the grave errors it committed, contributed to inflation. That was the tenor of his remarks. He said that the workers were responsible for inflation because they had received an additional amount of money out of the pool of wealth that they, by applying their labour to raw materials, had produced for this country. It is a well known economic fact that production depends on two very important sections of the community. You have your captains of industry, who supply the wherewithal, and you have the labour force which applies its labour to the raw materials. The pool of wealth that is created should be divided between those two sections. But what has been the position over the years? Those who supply the labour have received the smaller share of the wealth created. That has been so ever since the Industrial Revolution, or even earlier. Because of that condition of affairs, slowly but surely, with much attendant industrial strife, a system known as the arbitration system was evolved in the hope that a more equitable measure of the wealth produced would be granted to those who supplied their labour. But the worker has been resisted all along the line in his efforts to seek a fair share of the pool of wealth. He has been consistently told that his share should be smaller. Thus, Mr. Aird has suggested that grave errors of judgment on the part of the Arbitration Commission have brought about the present inflation in the Australian economy. He suggested to the court that any further wage increases would cause irreparable damage to the economy. He urged the commission to dismiss an application by eight metal trades unions for an average increase of 22s. in the basic wage.

Just imagine the riotous time the worker would have in spending that 22s., if he were to get it, with to-day’s high prices! What a wonderful time he would have on that 22s.! A glance elsewhere in the newspaper to which I have been referring reveals the increased dividends paid by the various companies, and emphasizes the futility of the claim that wage increases granted to the workers have been the sole cause of inflation. Mr. Aird suggested that wage and margins increases granted since 1952-53, and particularly last year, have aggravated the evil of inflation, have created problems for governments and employers in financing a growing economy, have added to our balance of payments difficulties, have caused the precipitate removal of import restrictions and have exposed industry to the threat of overseas competition at a time when the commission’s decisions had further undermined the competitive position of industry. Just fancy: These workers, in asking for a few shillings a week extra, have caused all this trouble to so many people?

Mr. Aird suggested that last year’s decision to increase the basic wage by 15s. - the second highest amount ever granted, mind you - plus the 28 per cent, margins rise, had increased award rates by almost 10 per cent, in less than six months. Ten per cent, represents 2s. in the £1 - a very fine increase - and that is causing all this trouble. Mr. Aird said that those two decisions had accelerated cost and price increases, had created an atmosphere of apprehension regarding the stability of the economy, and had raised doubts as to the adequacy of the arbitration system to resolve national wage problems. Evidently Mr. Aird believes that arbitration courts exist for the purpose of refusing claims made by workers. If the employers had their way, no increases in wages or salaries would ever be granted. Ever since the arbitration system was introduced, determined efforts have been made to prevent the workers from obtaining anything from the pool of wealth.

The gentlemen who have been appointed to the commission by this Government must know something about the tasks they have undertaken. Did the Government appoint a pack of fools to the commission? Did it willy-nilly appoint anybody to the bench, or did it select the judges because of their undoubted knowledge? As a matter of fact, I believe that when the appointments were made to the bench the feeling was that if these honorable gentlemen were to err at all, they would err, because of their past environment, to the detriment of the worker.

In view of the attacks that have been made on the commission, and the suggestions that it has acted in error, I propose to quote from the report of Mr. Justice Kirby, President of the commission, to show that the commission knew what it was doing when it granted increases in the basic wage and in margins. Mr. Justice Kirby, when delivering his judgment in the margins case, referred to the manner in which the case for the employees had been presented by Mr. Hawke, on behalf of the Australian Council of Trade Unions. He said -

Mr. Hawke put broadly the case that in the proper fixation of margins the basic criteria are the market value at the time of the fixation of the wage and the economic capacity of the economy to pay the wages claimed.

Mr. Justice Kirby then said ;

The problem may be re-stated in a more general way, namely to what extent should the Commission be influenced in arriving at its decisions by the economic consequences which flow from them.

The question also arises whether in the fixation of margins the Commission should ignore Commonwealth Government fiscal and general economic policy, and whether it should proceed to a decision which, if the Government thought necessary, could be remedied by some fiscal or other government action . . . the Commission will bear in mind the various economic submissions made to it, including those about price rises and inflation. It will also bear in mind the fiscal and economic policies of the Government. It will not ignore the consequences to be expected from its actions, but it will not deliberately create situations which will need rectification by governmental action.

His Honour, after discussing submissions about percentage profits on shareholders’ interests and so on, had this to say -

We might add that the expression “ percentage profits on shareholders’ funds” is capable of more than one meaning, and may mean somewhat different things in different companies. We therefore conclude that in looking at the important item of company profits we are most assisted by looking at the aggregate profits of companies. Considering these aggregate profits and bearing in mind the other material which is before us, we feel that the position of companies is such that they are able to bear increases in award rates.

We are aware that in the past increases in wages have led to increases in prices, and we believe that in some cases increases in wages have been used as an excuse for increasing prices when this could have been avoided.

That was the opinion of the gentlemen who heard the submissions. Yet it is suggested by Mr. Aird, and by honorable senators who are opposing the amendment now before the Chair, that increases in the basic wage and margins have caused the present inflationary trend.

An address by the well-known economist, Dr. Coombs, has been referred to extensively in both this chamber and another place. I have read a report of the address. I think it was a most important address and that I would do well to quote one or two paragraphs from it. Senator Spooner rightly directed attention to a statement by Dr. Coombs that there could be an explosion if wages continued to rise. But before Dr. Coombs made that statement he had this to say -

Management appears to assume that increases in costs can be passed on, and this makes it less responsive than it should be to measures which by increasing productivity could reduce costs, or alternatively avoid increasing them.

Similarly, management fails to pass on in the form of reduced costs increased output resulting from increased productivity. in addition, management tries to set prices at a level which will give profits sufficiently large to provide new capital for their expansion.

Dr. Coombs then suggested that in his humble opinion the workers are entitled to demand a greater share in the country’s productivity and that because of the attitude of producers or retailers in passing on costs there could be an explosion. It seems to me that two factors are operating to force up prices. The first is the unreasonable attitude of industrialists and traders who want to increase their profits by passing on all costs but refuse to pass on the results of increased productivity or work for increased efficiency within their own plants. Because of the ability of manufacturers to pass on increased costs, very little, if any, effort has been made to improve plant efficiency.

I have been amazed and appalled to read in recent weeks of the need for some of our industries to go to foreign countries to obtain necessary materials. Representatives of the Commonwealth Railways are going to Japan for improved rolling-stock in spite of the fact that over the years Australian tradesmen have been able to supply all the requirements of our railways systems. During the years of my association with the Victorian railways all of Victoria’s highclass rolling-stock was made in its own workshops. But it is now proposed that we go to a subsidized Japanese company to obtain signalling equipment, which has been manufactured in this country ever since railways were first established here. Is not that an indication that those in charge of the industries concerned have failed to keep pace with the developments that are taking place? Industrial concerns that think only of profits are responsible for this situation.

It is said that the reasonable demands of wage-earners for a share of the increased production to which they contribute would cause further inflation. There has been a per capita increase of production, and the workers are entitled to their share. Was it not said by the President of the Commonwealth Conciliation and Arbitration Commission, in making the award, that if the workers could not obtain an increase of wages in times of prosperity, he did not know when they could obtain an increase? Yet we have honorable senators and people such as Mr. Aird, who appeared before the Arbitration Commission, suggesting that there should be no increase.

Senator Wedgwood, during the course of her remarks, directed attention to the position of women workers. I wonder whether honorable senators have ever thought that the prosperity that we are talking about, and the development of our economic conditions, have been brought about largely by the industrialization, as it were, of our women folk. In our younger years, women played their part, and Senator Wedgwood dealt with some of the ways in which they did so. But woman is no longer the queen of her home. No longer has she the opportunity to devote herself exclusively to home duties, as she did in the past. To-day, owing to the development of our industrial concerns and to increased costs of commodities, it is necessary for wives to enter employment. When young women marry, there is not now the kind of send-off that used to occur. They do not say goodbye to their jobs, with their workmates wishing them well in their new sphere. To-day, the question that is asked is, “When are you coming back? How long will you be away - a week, a fortnight, or longer “? The change in the position of women is due to the economic conditions which exist in this country, often resulting in both a man and his wife having to work in industry.

This Government is represented before the Arbitration Commission to oppose the reasonable requests for improved conditions that are being made before that tribunal. I regret, Mr. Acting Deputy President, that I have not sufficient time in which to develop further my argument in that regard, but let me say to the Government, in conclusion, that if there were an enemy which suddenly confronted Australia with the threat of invasion, the Government would not be looking for a few shillings. In that event, it would be a case of an all-out effort to defeat the enemy. I suggest that inflation within a country is just as dangerous as is the threat of aggression from outside. Inflation could destroy this nation and its economy. Therefore, the Government of the day should be devising ways and means to deal with the problem of inflation. If it fails to do so, we may be overwhelmed. I support the amendment.

Senator MCKELLAR:
New South Wales

– I have much pleasure in supporting the motion moved by Senator Lillico and seconded by Senator Drake-Brockman. I also have pleasure in associating myself with the expressions of loyalty to the Throne that have been voiced during the debate. I extend to our newly-appointed Governor-General and his wife a cordial welcome to Australia and express the hope that they will be just as happy here as were their predecessors. We are very happy to have them with us.

I believe that there are two things that could prevent the continued progress and development of Australia. One is war and the other galloping inflation. I felt very uneasy indeed about the position until a few days ago, when we had a statement from the Prime Minister (Mr. Menzies) informing us of what Cabinet proposed in regard to inflation. I take this opportunity to express my appreciation of the action that has already been taken. It was necessary that it should be taken. It is a start in the fight again inflation.

We know that the lifting of import restrictions will not be popular in many quarters, but I think that, in the interests of all Australians, it was necessary for that to be done. Because much of the criticism in this regard will come from manufacturers, it is refreshing to find a manufacturer who has adopted what I think is a commonsense approach to the matter. The gentleman to whom I refer is the manager of

  1. and J. Farm Equipment Proprietary Limited, a subsidiary of Waugh and Josephson Proprietary Limited. An article published in “ The Land “ last week had the following to say about his views: -

He said that he had seen criticism of the lifting of import restrictions by the Commonwealth Government in the daily press and expected to see more. He went on to say that representatives of Australian manufacturers had expressed fears of competition from abroad. “ In my opinion,” he said, “ secondary industry is capable of meeting this challenge. Indeed, it must, if the Australian economy is to remain healthy. Individual manufacturers, distributors and sub-distributors may have to be content with reduced and more equitable profit margins, but this in the long run is a healthy trend.” He further said that it was essential for Australian secondary industry to manufacture goods at comparable world prices. “ We can do it,” he concluded.

I think that that is a very realistic view of the situation that confronts our manufacturing industries, because in addition to the tariff protection that has been accorded them over the years, they have had the additional protection of import restrictions. The restrictions were never intended for that specific purpose, but they had that effect. It is refreshing to see that at least one man, who has quite a substantial interest in industrial affairs, has adopted such an attitude.

His Excellency the Governor-General, in his Speech, referred to the new defence measures adopted by the Government. It will be remembered that the Parliament did not have an opportunity to debate those measures, because the announcement concerning them was made after the Parliament rose. I, for one, am very disappointed indeed to find that the measures will mean practically the disbandment of Citizen Military Forces units. History provides us with many striking examples of the wonderful officer material that we got from that source, and I think it is regrettable that we are no longer to be able to draw on it.

To return to the subject of inflation, it is evident to all of us that if we are to achieve the objectives that Cabinet has set for the purpose of maintaining a balanced budget, we have to cut costs. There are many angles to this problem of costs, and here the primary producer is vitally concerned. In his case it is a question of either cutting costs or being granted some assistance. We do not want to see him reduced to the position of seeking assistance; he is anxious to retain his independence.

One way in which I suggest his costs could be cut is to abolish the pay-roll tax. I venture the opinion that if that tax were abolished, this Government would be saved an appreciable sum, as would the State governments also. Further, by not being required to pay pay-roll tax, State governments would have less reason for seeking further money from the Commonwealth. Local government authorities would effect a saving in the same way. Further, the primary producer would have lower costs in that abolition of pay-roll tax would reduce freights and, consequently, the landed cost of goods that he requires. I recommend the Government to give serious consideration to abolishing this tax. As an instance of the saving that could be effected in primary producers’ costs, I mention that one co-operative shearing company in New South Wales is required to pay pay-roll tax of approximately £20 for every 5,000 sheep shorn. If that tax were abolished, the grazier who had his sheep shorn by that company would be saved £20 for every 5,000 sheep shorn.

Sales tax is another factor in costs. This tax hits the farmer heavily, and the further he lives from the point of production, the harder he is hit. It is obvious that an article produced in the city close to the source of raw materials costs less in the city than it costs a person living 500 miles away. When I point out that sales tax is levied on the basis of landed costs, including freights, honorable senators will appreciate that it can be heavy on the primary producer.

I feel, too, that industry can do much more than it has done in the past. At a recent inquiry one union advocate stated that the worker received an average of £2 a week more than the award wage. We know also that during the past five or six years employers have been attracting employees from other organizations by offering higher wages. All this adds to the cost of the article produced and retailed to the primary producer. There is room for improvement there. The Tariff Board, which offers protection to such industries, should ensure that, industries operate economically, and that they do not force up the cost of production by paying employees an average of £2 a week above the award rates. The primary producers could help their own cause by ensuring that they are represented at Tariff Board inquiries. Too frequently in the past they have neglected to be so represented and have suffered in consequence.

Many people argue that a person who is settled on a block of land is right for life. Indeed, that has been suggested many times during this debate and, at the risk of wearying honorable senators, I propose to detail facts pertaining to primary production. I shall refer to wheat production first. This is an industry in which I have had a lifetime of experience. Because of that experience, I am able to endorse Senator Wade’s reply to Senator Kennelly the other night that the wheat-growers have contributed something like £200,000,000 to Australia’s economy. They did that by selling wheat in Australia at a much lower price than that obtained on overseas markets.

Now, let me outline the stages of production on the farm. First, the ground has to be made ready for sowing. When it is ready it might be too dry for sowing. If it is sown under those conditions, and no rain falls before winter, the seed does not germinate. On the other hand, at the right time for sowing the wet season might set in and the ground might be too wet. I have seen that happen frequently. If the farmer does get his wheat sown and there is a fall of rain immediately afterwards, the wheat bursts in some districts and does not shoot. That is the end of the farmer’s seed. He might have to re-sow. By the time he has re-sown, it is late in the season and thistles might have grown over his property. These thisties kill the wheat and the yield from the crop is low.

Senator Hannaford:

– That sounds like New South Wales.

Senator MCKELLAR:

– Parts of New South Wales are better than others, but I think the conditions I am describing apply in other States. Let us suppose that the farmer gets his wheat up. The possibility then is that he will have to contend with grasshopper hordes about which very little can be done, although more effective steps can be taken now than a few years ago. Again, let us suppose that the wheat is grown and is almost ready to strip. The farmer may insure against hail and against fire, but he cannot insure against either rust or frost; and both rust and frost can cause a great deal of damage to cereal crops in New South Wales. If the farmer escapes these dangers he is then liable to suffer storm damage to his crop. He cannot insure against that, and there have been instances when the crop has been flattened. Where it has not been flattened, the wheat has started to shoot in the head so that the wheat which is harvested is worth only a fraction of what it would have been worth if no disaster had overtaken the farmer. While all these things are happening to reduce the value of the yield, the farmer’s costs for machinery are soaring rapidly. For instance, it is by no means unusual to have to pay as much as £500 for a plough to prepare the soil in the first place. Again, the farmer works not 40 hours a week but an average of sixteen hours a day.

I turn now to wool. Australia produces one-third of world supplies of merino wool. Senator Sheehan said that the greater percentage of the wool was produced by men running several thousands of sheep. In fact, the greater percentage is grown by men running 1,000 or fewer sheep. Many people have had the impression that the high prices paid for wool in 1951 put the grazier on his feet and in an assured position. They have argued that the grazier would never look back. I admit that those high prices helped to put the graziers on their feet. I admit that because of those prices the graziers were in a better position than they had ever been in before; but I remind honorable senators that the taxing laws at that time prohibited the accumulation of cash reserves. The high prices did mean that graziers could spend extra money on improving their properties, but they gave no opportunity to him to accumulate cash reserves, and because of that fact the graziers have been forced time and again to seek overdrafts from the banks. I hope honorable senators appreciate that present wool prices although they seem to be high are really only marginal prices and that only graziers who have been established in wool-growing for some time are able to carry on their undertakings on a businesslike basis.

Sitting suspended from 5.45 to 8 p.m.

Senator McKELLAR:

– Prior to the suspension, 1 was speaking about the difficulties faced by primary producers. Only to-day I saw figures showing that about 450 soldier settlers who had been engaged mainly in wool-growing had left their blocks. This will probably come as a surprise to most honorable senators; 1 know that it was a surprise to me. 1 cannot say in which State these settlers were. 1 had outlined the difficulties that the wheat industry faces. I propose now to mention some of the difficulties of woolgrowers. They have all sorts of pests to contend with. Blow fly, drought, foot rot, lice, worms and fluke are some of the things against which they have to guard, taking preventive or corrective measures where possible.

Senator Kennelly:

– Are you blaming the Minister for Civil Aviation?

Senator McKELLAR:

– I am not blaming any one. This is information that Senator Kennelly would do well to absorb, because, judging from his remarks during this debate, he is very ignorant of what happens to the primary producer and the difficulties that he confronts. We have also heard some reference to rich wool barons, so it might be of interest to repeat what Mr. W. M. Weatherly, chairman of the Australian Woolgrowers Council, said in Sydney recently, as reported in the “ West Australian” of Wednesday, 16th March. Mr. Weatherly said -

A Commonwealth survey of the sheep industry had shown that the average return of capital in 1958-59 was 1 per cent, in the pastoral zone, 4 per cent, in the wheat-sheep zone, and 0.5 per cent, in the high rainfall zone. Because of higher wool prices, returns for 1959-60 should be better, but much of the price increase would be absorbed by higher costs. No secondary industry would survive for long with returns of this order. It is unreasonable to expect an industry as important as wool production to do so.

When wool-growers and primary producers of all kinds are faced with low prices they endeavour to cut costs by reducing maintenance, reducing employment, and working longer hours themselves. I was very concerned to hear Senator Kennelly say that the high cost of production, particularly to the wheat-grower, would be passed on in the home consumption price. I should like to remind him that higher costs will mean that less maintenance will be done on properties, and consequently less employment will be available. 1 turn now to the dairying industry. I suppose that there is no other industry in Australia, and that there are very few in other parts of the world, wherein producers must work seven days a week for 52 weeks of the year. Yet that is what the dairy farmer has to do. We know, of course, that a committee is at present inquiring into the dairying industry. It is hoped that as a result of that inquiry some further relief may be granted to dairy farmers. I ask honorable senators to contrast the return received by the dairy farmer for working seven days a week for fifty-two weeks a year, with that received by waterside workers who, according to a newspaper I read the other day, received £1 1 for working one Sunday shift.

I turn now to the fruit industry, wherein the grower is at the mercy not only of the weather, but also of the high cost of selling his produce, which has almost put him out of existence. Only last week I read of a glut of pineapples in Queensland, where sound pineapples were selling for as little as lid. each. One can imagine the loss that would be sustained by the grower under those conditions.

I remind honorable senators that a great proportion of the costs of the primary producer are items over which he has no control. Among these are local authority charges, which are very high. Rates have risen to an alarming degree. So far as I can see, unless shire councils can obtain further relief by way of increased monetary assistance, they will need to curtail maintenance. Rates have reached an all-time high, and if they rise further it will be simply impossible to meet them. I suggest to persons engaged in local government that their costs could be cut by getting greater production from their employees. Just recently, my wife and I were travelling to Sydney when, in the vicinity of the Sutherland shire area we saw, much to our amazement and horror, three men using one shovel. Tt was an ordinary shovel, with a rope attached to it. One man put the shovel into the dirt and the other two, holding the rope, pulled the shovel, with the dirt on it, a distance of about three feet. These were three fully grown. adult men, operating one shovel. Our one regret was that we did not have a camera in order that we might be able to show others what we had seen.

The only suggestion that Opposition senators have made for meeting the inflation about which they are so alarmed - I give them credit for being alarmed - is the imposition of controls. Are they prepared to go back to the era when we had virtually nothing but controls, with petrol rationing, sugar rationing and butter rationing? I am quite sure that they are not prepared to do that. Yet that is, in effect, what they are advocating to-day. That is their only solution for the problem that confronts us. They say that we must have prices control with all its evils, black-marketeering and all the rest. I am quite sure that they do not really want to return to those conditions, but they have to advance a solution and that is all that they suggest. Senator Cant mentioned his dislike of big employers.

Senator Courtice:

– Of what?

Senator McKELLAR:

– Of big employers. That is what “ Hansard “ has recorded Senator Cant as having said. What do those big employers do? Do they not provide employment for many people who would not otherwise be employed? If only for that reason, surely they are entitled, to some consideration, even if the Opposition considers that they are making too much money at present. I understood Senator Sheehan to cite evidence given before the Arbitration Commission of profits made by large companies. A few moments ago I mentioned the profits being made by primary producers, which might well have been taken into consideration before wage margins were last increased. Senator O’Byrne said that the margins adjustment would involve an increase of just under £18 a week for some of our public servants. That figure is not correct. I should like him to know that the figure is just under £15 a week.

As I said earlier, this Government has taken positive steps. Those initial steps were necessary. Other steps will also be necessary. Some of them I have outlined to those who, I hope, will be putting them into operation. Although the Opposition has not produced any worth-while plan for combating inflation, it is very keen, as are the rest of us, to ensure that the economy remains sound and it has made suggestions as to how this may be achieved. I am afraid they would not work. We at least have this consolation, that during the regime of the Menzies Government we have seen the welfare of everybody in Australia improved immensely. I think that has given us some comfort regarding the future, because we can look with confidence to a Government which has done so much in the past for its people continuing the work, and I feel that this task is so much harder. I still feel confident that this Government will produce a plan to stave off inflation and put us on as stable an economy as possible in the circumstances.

The other evening, my friend, Senator Drake-Brockman, from Western Australia, touched on a subject that is considerably exercising the minds of wool-growers at the present time, and it will be exercising their minds to a greater extent now in. view of the present threat of inflation. The suggestion has been made - he commented on it - that there should be a floor price for wool. The attitude of the responsible Minister has been that when the woolgrowers of Australia make up their minds that they want a referendum regarding a floor price for wool, he will see that an opportunity is given to them to hold a referendum. Prior to the growers making up their minds and making a request to him with a united voice, he feels that this Government will not do anything about it. I support that attitude. In conclusion, once again I have pleasure in supporting the motion for the adoption of the AddressinReply, and I oppose the amendment.

Senator McKENNA:
Leader of the Opposition · Tasmania

– Mr. President, in common with other Opposition speakers, I cordially support the terms of the motion relating to the Address-in-RepIy. I wholeheartedly support the terms of the amendment moved by Senator Kennelly condemning the Government for its failure to halt inflation. At the outset, I refer to the speech made by the Leader of the Government in the Senate (Senator Spooner) last Wednesday evening. In a speech that sounded very impressive he covered a number of matters. I propose to refer to one or’ two of them. I should like to traverse the whole of the speech, but time will not permit of my doing that. The honorable senator took an Opposition senator to task for referring to Dr. Coombs’ speech and chided him for the manner in which he did so. He objected that anyone should take only those parts of it that suited his argument in debate and ignore the balance. Then the honorable senator proceeded to show what Dr. Coombs had said regarding consumers, wage earners and producers; and he himself offended in exactly the same way in that he made no reference whatever to the admonition that Dr. Coombs directed at government.

He referred to three of the factors the doctor had adverted to as affecting inflation and completely ignored any reference to government. I invite him to see what Dr. Coombs said on that point where he chided governments generally for the high taxation that prevented the people making savings and where he drew attention to the excessive taxation involved in financing public works. Dr. Coombs said that in 1958-59 public authority expenditure on works totalled £521,000,000- in that one year - but the net increase in public indebtedness in that year was no more than £126,000,000. In other words, the difference of £394,000,000 was taxed from the people of Australia by governmental authorities and expended on public works, to the detriment of savings.

The honorable senator himself completely ignored the fact that there was a fourth factor involved in the doctor’s address. Very impressively, the honorable senator quoted from the monthly bulletin of the United Nations Information Bureau, in these words -

As I said earlier, what we have clone to check inflation has been comparatively successful, having regard to what has happened in other parts of the world. I shall quote from the monthly bulletin of the United Nations Information Bureau to show the increase in living costs over the last six years for various nations. These figures show that the increase in living costs in Australia was 15 per cent., in Great Britain 19 per cent., in the United States 8 per cent., in New Zealand 18 per cent., in South Africa 14 per cent., and in Canada 8 per cent. On those figures, we have done better than Great Britain and New Zealand, we have done as well as South Africa and we have been beaten only by the United States and Canada.

That certainly sounded exceedingly impressive, and quite a good argument. I thought so until I looked at the bulletin and then the argument fell to pieces. In the first place, the honorable senator did not refer to the past six years; he quoted six years to the end of December, 1958; and on further examination that boiled down to five years only because 1953, the commencing year of the period he selected was treated by the United Nations as the base year at 100 per cent., and accordingly reflected none of the increase in that particular year.

Let us consider the figures that he quoted and which were in front of him. I am looking at them now; they were figures for the countries he selected, in some cases the year ending in September, 1959, and in others, November, 1959. He did not refer to this differentiation, although if the periods had been uniform there would have been very significant changes in the percentage. There were eight years covered in statements going back in fact prior to the base year 1952. He selected six only that suited his argument. If one included the figures for 1959 that were in the statement at which he looked, one would find that the rise in the cost of living in Australia according to the latest figures available was not 15 per cent, but 19 per cent. - a very significant difference. The rise in Great Britain was not 19 per cent, but 20 per cent.; in the United States of America it was not 8 per cent, but 10 per cent.; in New Zealand, not 18 per cent, but 24 per cent.; in South Africa, not 14 per cent, but 15 per cent.; and in Canada the rise in the cost of living was not 8 per cent., but 11 per cent. That information was before the honorable senator when he prepared his figures - I concede that somebody may have prepared them for him - which presented a completely wrong picture to this Senate, excluding the trends in 1959.

Let me add that the honorable senator claimed that Australia had been beaten by only two countries. We were beaten - and beaten badly - by three countries, as one will see when he looks at the latest figures, and it is very significant that the rate of increase in the cost of living in this country, Australia, has been approximately twice that of the United States of America and of Canada.

So much for the honorable senator’s lecture about the presentation of cases in this place, and so much, indeed, for his argument on that score. He also quoted statistics issued by the Central Bank - the

Reserve Bank of Australia - indicating that between 1950 and 1959 wholesale prices had risen by 53 per cent., retail prices by 76 per cent., and wage rates by 91 per cent. First of all, I would say that he and his Government should be ashamed to quote those figures in the light of the promise they made in 1949 that they would reduce living costs. He should be ashamed to quote them in this place. He and his Government were the ones who promised to put value back in the £1, and yet he uses an argument that there have been rises of that kind. But again, when he says that wages have risen by 91 per cent., he does not take into account ali the factors that operate to depreciate the value of wages most significantly. He ignores the incidence of taxation, particularly the enormously increased incidence of indirect taxation - which is paid at the same rate by rich and poor alike - that has developed under this Government. He ignores the fact that in 1956 this Government, without having given a warning at the elections held a few months before, imposed indirect taxes upon the people of this country to the tune of £115,500,000.

Senator Hannaford:

– What percentage increase is that?

Senator McKENNA:

– Let me develop my theme. Please do not interrupt when I am in the middle of a theme. What was that £1 15,500,000 of indirect taxation applicable to? lt applied to things that most people use every day - liquor, tobacco, petrol, cars and spare paris tor cars. Cars are not luxuries any more in this country. There is hardly a family in Australia that is not on wheels. There was hardly a family that was not affected by this increase. That £115,500,000 has to be taken into account when you consider a wage increase of 91 per cent.

That is only one of the factors. There is another which is very much more significant. There has been no increase in child endowment for ten long years, although during that time the basic wage has just about doubled. How has that operated on the worker with a family? It means that the value of child endowment has been more than cut in half. The thief called inflation has been let loose on child endowment during that period of ten years and has stolen more than a half of its purchasing power. That is another factor to which the honorable senator did not refer.

Let us consider the budget that we discussed in this place last year. It is true that everybody was given a 5 per cent, reduction of income tax, involving about £20,000,000, but although the Government granted that reduction with one hand, with the other it took away £22,000,000 - £17,000,000 of it in postal charges alone. Increased postal charges affect the whole community, including people who do not use the postal services, because they lead to increased costs. Another £5,000,000 was taken in pharmaceutical charges, which affect all the people of this country. Those are factors to which the honorable senator did not refer, although they are all factors completely relevant to the argument that he was addressing.

I come now to what he said about trade unions, to the approval that he claimed the trade unions gave to the decision of the Government to intervene in the proceedings before the Arbitration Commission and oppose any further addition to the basic wage at this stage. I shall quote him exactly. He said -

I am convinced, loo, (hat the trade unionists and the trade union movement appreciate and realize themselves that our action in putting the national viewpoint before the Arbitration Court is directly in the interests of trade unionists and is aimed at improving their living standards in Australia.

I should like to know who made Senator Spooner the spokesman for the trade union movement of this country. He could have had access to two documents that would have convinced him that what he said was not right. The interstate executive of the Australian Council of Trade Unions - the body that controls the trade union movement of Australia, with the exception of the powerful Australian Workers Union - had something to say on 26th January, when the Prime Minister had declined to meet the Premiers. It stated -

This meeting of the A.C.T.U. Executive condemns the attitude of the Australian Prime Minister disclosed in his letter to the State Premiers suggesting that the efforts of the A.C.T.U. to restore real wage standards for Australian workers should have been opposed by all State Governments.

There is the flattest contradiction by the trade union movement of what Senator

Spooner had to say. If Senator Spooner will look at the circular letter issued by the A.C.T.U. on 8th March to its State branches and to affiliated unions, he will find that it included the following statement: -

Secondly - and in a general sense much more important - this decision of the Arbitration Commission has revealed the Menzies Government in its true light as having a so-called economic policy which is no more than opposition to legitimate wage increases.

There are other aspects of the honorable senator’s speech that I wish I had time to deal with, but one or two of them will obtrude as I proceed with my theme.

Inflation is not new in Australia. The present inflation is not the kind of inflation that we had in the immediate post-war years, but there is no understanding of the position to-day. There is no vesting of responsibility for it unless one has a rapid look at the history of inflation in this country from the time of the post-war years. If one man is to be blamed for inflation in Australia it is Hitler. The war was the cause of inflation. All normal activity was stopped - building, travel, housing and every mortal thing - so that we could marshal the resources of the country for total war. Normal activities could not proceed. After the war, terrific purchasing power had accumulated in the hands of the people and of the troops. The Labour Government of the day realized very clearly that it could not wait for these two forces to come together. Materials were in short supply and there was terrific purchasing power, so the Government had to do something to endeavour to prevent their impact on each other. Without control, inflation was the inevitable result.

With a sense of responsibility, the Labour Government put to the people of this country in 1944 a referendum asking for a number of economic powers. It did not ask for them forever, but for five years, during the period of adjustment. It warned the people of Australia of what would happen and asked, amongst other things, for power over employment and unemployment, companies, trusts, combines and monopolies, profiteering, prices and the production and distribution of goods. The Government knew that without some form of control, inflation would go through the roof. The parties who now constitute the Government went on to the hustings and advised the people not to support the referendum. I concede that the referendum proposal had the defect that all fourteen points had either to be accepted or rejected at once, but on the advice of the parties that now constitute the Government, the people rejected it.

In 1946, the Labour Government again submitted a referendum on industrial conditions. The parties opposite opposed that too. I have heard many an honorable senator now on the Government side argue that one of the greatest elements affecting the Australian economy is the wage structure, and I concede that without hesitation. It is a great factor, but honorable senators opposite advised the people in 1946 not to vote for the referendum proposals. It was at that point that this country got on to the slippery slide. After that pronouncement by the people of Australia, made at the instance of the Liberal Party and the Country Party, the Government of the day realized that “no longer could it hold proper wage controls. They were relaxed throughout 1946 and 1947, and then abolished. That is when Australia really began to go bad in the matter of inflation. We are still concerned about the other factor that affected costs.

In 1948, as a government, we put another referendum to the people on rents and prices, including charges. Again the supporters of the present Government went on the hustings and said to the people: “ Let us abolish all restrictive controls. If the economy is allowed to run free, prices will adjust themselves and everything will be cheaper.” Unfortunately, the people of Australia accepted that advice. As a consequence the slide to inflation was completed, killing from that minute on all possibility of further effective prices control. The men working in the prices administration realized that their jobs were about to peter out and that a challenge to the exercise of the power at that stage in the High Court would bring the power down. Even if the power were there, the staff deserted. Naturally enough! I do not blame them. They had to find their way in the post-war world. Those are the two factors that were primarily responsible for inflation in Australia.

What a different story it would have been had power been held for the five-year period. Supply and demand would have been adjusted in. that time. There would have been no slippery-slide from which the economy has never escaped.

Now let me come to the era of LiberalAustralian Country Party government. In 1949, Mr. Menzies- promised the people what he would do if elected. I have a copy of his election speech and his advertisements at that time. I will not weary the Senate with them, but I. remind honorable senators of some of the promises in their exact terms. One promise was toreduce living costs and increase real wages: Mr. Menzies said that he had a practical plan for increasing’ the purchasing power of wages and reducing the cost of living. He promised to put value back into the £1. They were promises made solemnly to the people of this country in 1949. They were accepted by the people, and the present Government was elected to office.

Senator Wade:

– And has been returned at every election since those promises.

Senator McKENNA:

– Yes. In 1950, when the basic wage rose 13s. - a most extraordinary rise due to increases in the cost of living - the Labour Party, as the Opposition - and we had a majority in this chamber then- raised the matter again and again. We eventually passed a bill in this place to force the Government into some kind of action, if we could, with respect to rising prices. We asked for a referendum on prices. The bill was passed in this chamber, sent to the House of Representatives, put at the bottom of the notice-paper and never considered or debated. Nevertheless, it was a constant reminder to the Government. That was the historic occasion upon which Senator Spooner, who then represented the Treasurer in the Senate, said -

The other method of approach is to try in an intelligent way -

He was talking about inflation - to diagnose the basic cause’ of the trouble, and so to direct the national effort as to eliminate that cause; in other words, to encourage the efforts of the citizens of Australia, who alone -

I emphasize that word - can provide the solution of the problem insofar as it can be solved by any action within Australia.

That is the most helpless and hopeless statement in the face of a rising threat of inflation that has ever been made. In short, the captains in charge of the Australian economy abandoned ship. They left, it to the people of Australia to do what they could about it.

Now I come to Mr. Menzies’ own actions following the passing in this place of the bill that I have mentioned. That bill really stirred him up. He went on the air for a very lengthy period with two statements one night after the other. The first statement was on 5th October, 1950, and the second on 6th October, 1950. The first statement was entitled, “ Rising Prices - Why? “ The second statement was entitled “ Rising Prices - The Answer.” I have before me copies of those two statements, issued by his own- office. This is what he said in proposing answers to the problem of rising prices -

We propose to present to the Parliament a bill to impose an excess profits tax. This is a novelty in time of peace.

No such bill has ever been seen or heard of from that day to this. We have had inflation with us for the whole ten years. Mr. Menzies’ statement was a plain acknowledgment that there was a degree of price inflation in the situation. He developed the theme in the course of his talk. He promised the people, in a nation-wide broadcast, to introduce a tax on excess profits, but no such bill was introduced. In another promise he said -

We promise to institute a control over basic materials.

Basic materials were in short supply at the time. He. did not lift one finger with regard to that matter either. It is interesting to trace the history of these matters, and to see the pattern of inaction on the part of this Government running throughout. What the Opposition has suggested now may not, I concede, be the best thing. We have never argued in this place that price control is a panacea, but we have always said that it is an essential ingredient in the control of an inflationary situation such as the one that has afflicted Australia from 1950 onwards.

I pass now to the next highlight of the situation. An election was held in 1951. The leader of the Labour Party, in placing Labour’s policy before the people on that occasion, said that -

I am certain that it will be possible to obtain the fullest co-operation with the A.C.T.U. and the great trades unions in carrying out Labour’s programme for stabilizing the economy of Australia.

Such agreement would most certainly lead to a firm understanding that, subject to effective price and profit control the trades unions would cooperate most actively with a Labour Government to achieve and maintain economic stability in this country.

What did that mean? It meant that Dr. Evatt, not speaking at large but speaking, of course, after consultation, was in effect saying that the trade union movement is realistic, that it is responsible and that it would consider accepting wage pegging provided it were coupled with effective prices and profits control.The same opportunity was available to this Government. Was the approach ever made? No. The Government went blithely on its way and in its first three years of office most of the damage was done. It was during this period that the cost of living beganto rise. During the Government’s first year of office the basic wage rose by 13s. a week through costofliving adjustments. I ignore completely the £1 that was added to the wage by the Arbitration Court in December of that year. The 13s. increase in the basic wage was because of rising prices. In the next year the basic wage rose by 38s. a week due to rising prices. You can imagine the measure of inflation that brought about that result. In 1952, a further 31s. was added to the basic wage. In other words, because of rising prices the basic wage, in the first three years of this Government’s mandate, rose by a total of £4 2s.

Senator Hannaford:

– You do not say anything about the £600,000,000 wool cheque.

Senator McKENNA:

– I am not talking about the wool cheque. I know what the Government did about wool. I know that it pre-collected the tax with regard to wool as an anti-inflationary measure, and undoubtedly that was a wise move. Senator Hannaford is still interjecting, but I do not propose to go wool gathering with him, and I will not be diverted from my theme. I make the point that, through nothing but rising prices, £4 2s. accrued to the basic wage in the first three years of this Government’s term of office. That represents an increase of 63 per cent. of the basic wage of £6 9s. a week, which this Government inherited. To-day the basic wage is £13 16s.; it would be £14 if cost of living adjustments were still applicable. In other words, the basic wage would have risen from £6 9s. to £14. That is the story of inflation.

To show the utter absence of understanding on the part of this Government, I direct attention to a statement that I have before me and which was made by Sir Arthur Fadden when he was Treasurer. He claimed that inflation stopped in 1952, but in that year alone the rise in the cost of living was 31s. a week. Could there be clearer evidence of the fact that the Government did not know what it was doing? Now we come to September, 1953, when the Arbitration Court decided that cost-of-living adjustments should be abolished. From then until June, 1956, the basic wage remained pegged at £11 16s. From a practical viewpoint, wages were pegged.

But what happened to prices during that period? Did they stand still when the basic wage was pegged? Of course they did not. They moved all the time. They moved slowly at first, but in 1956 the order of rises for each of the quarters was 15s., 18s., 14s. and 23s. a week. The last rise would have been 33s. but for the basic wage increase of 10s. which was awarded by the court in June of that year. The truth of the matter is that, despite increases of 10s., 10s., 5s. and 15s. in the basic wage over the last four years, making a total rise of £2, the cost of living, as shown by the C series index, has been ahead’ of what the workers have been paid as a basic wage except in one quarter when they broke even at £13 16s. The quarter to which I refer was the August quarter of last year. Senator Cant dealt very well with the basic wage and its ingredients, so there is no need for me to deal with that matter. He showed that the worker never managed to catch up with rising costs and prices.

Senator Maher:

– What did Professor Arndt say?

Senator McKENNA:

– I should imagine that Professor Arndt has said a lot of things in his time. Senator Ridley, an Opposition senator, made one of the best informed speeches I have ever listened to in this place on the subject of margins. He indicated how they have lagged all the time. Yet, I repeat, prices have risen throughout the whole period in question. Dr. Coombs directed attention to that matter in a most powerful way right at the beginning of the speech he delivered in Perth. I am not able to put my hands on a copy of his speech instanter, but I recall that he pointed out that, even in a period of some recession in Australia some years ago, with less production, more unemployment and lower retail sales, prices continued to rise. Dr. Coombs’s idea in making that speech - he does not advance solutions - was, as he said, to stimulate thought. He rendered a great service in making it. He pointed out that the trend in Australia is for prices to rise despite what is happening to the rest of the economy.

Senator Maher:

– They must rise following wage increases.

Senator McKENNA:

– Let the honorable senator rise later and explain why there were price rises in the year to which I directed attention in spite of the fact that the basic wage was frozen for nearly three years.

Senator Maher:

– I shall tell you to-morrow.

Senator McKENNA:

– You may, but I do not intend to let you have the floor now. Let me refer to some of the comments of the Commonwealth Arbitration Commission when it granted the last increase in margins and was dealing with the basic wage. I do not think any one will deny that the Arbitration Commission is concerned about the stability of our economy, that it is prepared to allow something to workers for their degree of productivity, and that it has some regard to the capacity of industry to pay. If one reads the basic wage judgments of the commission, one sees that it has dealt with those three aspects of the matter one by one. Now, in partial reply to Senator Maher, let me quote some extracts from the commission’s judgment on the margins issue. This part of the judgment has been quoted in this chamber before, but it bears repeating -

Considering those aggregate profits-

The commission is referring to company profits - and bearing in mind the other material which is before us, we feel that the position of companies is such that they are able to bear increases in award wages.

Of course, when the commission said that, it had before it the material that the Commonwealth Statistician and the Government had submitted.

I refer now to the White Paper issued for 1958-59, at page 11 of which it is pointed out that undistributed profits and depreciation allowances amounted to a large part of the total funds available to businesses for financing investment. Now I turn to table 6 in the attachments to the White Paper to indicate what has happened over the past few years while this Government has been in office. In 1951-52. the total amount available to industry under those two heads for private investment was £262,000,000. That sum represented only 23 per cent, of the total amount available for private investment. But what happened in the last financial year? The sum available had risen to £640,000,000 - all taken out of profits earned. Of that sum, £201,000,000 was in the form of undistributed profits and £439,000.000 was set aside for reserves. In other words, the people of this country contributed that sum in prices to provide for the future expansion and development of companies.

Senator Henty:

– What percentage did that sum of £640,000,000 represent?

Senator McKENNA:

– It represented 56 per cent, of the total sum available. I repeat that the total sum held by companies under those two headings in 1951-52 represented 23 per cent, of the total sum available for private investment and that the sum available to-day represents 56 per cent, of the total. Does not the Senate think the Arbitration Commission had regard to that factor? It is not a matter of looking at what dividends were paid. These two sums were in addition to dividends. Supporters of the Government in another place have been critical of the Government on this account.

I quote now the following passage in the recent margins judgment of the Arbitration Commission -

We are aware-

It was a unanimous judgment - that in the past increases in wages have led to increases in prices, and we believe that in some cases increases in wages have been used as an excuse for increasing prices when these could have been avoided.

That is undeniable. How far that has gone, the commission does not say, but it had before it ample evidence, in the facts and figures supplied by the unions, the employers and governments, to make that statement. The truth is clear to anybody who thinks. To-day we are in the midst of prices inflation.

Senator Maher:

– Which is full of danger for the economy.

Senator McKENNA:

– I agree entirely. That is why I am devoting this whole speech to the subject. That is why the Opposition, acting with a sense of responsibility, has moved an amendment relating to that one topic. We realize the danger, and we hope to galvanize the Government into taking effective action.

Senator Sheehan:

– That will be pretty hard to do.

Senator McKENNA:

– It will be difficult. One really needs to be charged with atomic power (o achieve it. Let me make my last reference to what the commission had to say. As recently as November last, it stated -

We are conscious of the desirability of attempting to maintain the economic stability which this country has achieved. We are also conscious of the desirability of ensuring that wage justice should be done to employees under this Award. We have looked at the increases which we propose to grant in this case in the light of the submissions about economic stability and we do not consider that such increases are so likely to affect that stability that the economy will be adversely affected. If marginal increases cannot be granted in times of economic prosperity such as the present, it is difficult to imagine when they can be granted.

Senator Mattner:

– Does the honorable senator believe that?

Senator McKENNA:

– The members of the commission, the majority of whom were appointed by the Government which the honorable senator supports, not only believed it, but said it. I think that it is the quintescence of common sense to say that at a time when conditions are booming. We hear from every speaker on the Government side about the prosperity we are enjoying. It seems to be a matter of common sense, in those circumstances, for a responsible body like the Arbitration Commission to say that if the workers cannot obtain marginal increases at such a time, they will never be able to get them.

Senator Mattner:

– Does the honorable senator believe what it said?

Senator McKENNA:

– I not only believe it; I am quite certain it is right.

I want to refer to words used1 by the Prime Minister (Mr. Menzies) in a statement that he made on 21st February last, which had nation-wide circulation. This brings the matter right up to date. The Prime Minister said -

There are other tendencies which are perturbing. The most serious of these is the rise in costs and prices. In some degree, this has been going on for a considerable time, but in recent months it has become faster and it is now decidedly too fast.

We agreed with that. In fact, the whole Senate agrees on that point. The Prime Minister went on to say -

It has been a process of adding, one on top of the other, a great many particular increases in wages, profit margins, charges and the like, some large, some small, but all contributing to a general upward movement that has grown faster as it has gone on.

I do not contest one word of that statement, but I say that the remedies that the Prime Minister has put forward, apart from the relaxation of import controls, have not been directed to trimming profit margins, charges and the like - factors that he admits are involved in the inflationary trend. Time permitting, I shall deal with this matter in a moment or two.

I want at this stage to say a word or two about the side effects of inflation in this country. The increase of interest rates under this Government has destroyed the loan market. I need not argue that point. I have argued it many times previously in this place. The Government has done what Dr. Coombs warned against - it has raised almost unlimited moneys by taxation from the people of Australia to fill the gap left in the loan market. The figures are of no mean order. The sum of £1,084,000,000 has been taken in taxes from the people at the instance of this Government, together with £576,000,000 for the States, a total of nearly £1,700,000,000. This year, the Government will undertake capital works of a value of £142,000,000 from its own revenue. I point to that matter merely to indicate how the failure of the loan market, through inflation, has led to a terrific burden of taxation being placed on the people of Australia.

Then we come to another subject about which I have spoken quite often in this Senate. The Government has taken from the people nearly £600,000,000 which it has lent to the States at interest. The States are obliged to repay the money and to pay interest on it in the meantime, although it is money that has been raised by taxation from the people of Australia. What kind of an effect has that on an inflationary situation? Of course, it places a heavy additional burden of interest on State budgets. The States are forced to increase charges for the services they provide. Those charges increase costs and, of course, increase the inflationary tendencies. They add fire to inflation. That 19 a most decidedly inflationary process.

I pass to the question of interest rates, held at a very low level by the Labour Government but now so high that, according to public advertisements, people may obtain 15 per cent, by lending their money to investment companies. This means, of course, that undertakings which borrow money at rates of interest of that nature have to pass on the cost by way of increased prices ot charges.

Senator Maher:

– There is not too much security behind the 15 per cent.

Senator McKENNA:

– There may not be. I do not know much about that, and I shall not comment. The companies have to earn the 15 per cent., and to do so they have to make additional profits.

Senator Maher:

– My money will not be in companies of that kind.

Senator McKENNA:

– But there is no doubt that money goes into such companies. In this inflationary situation, it is interesting to note that the Prime Minister, in the speech that he made on 29th February last to the International Congress of Scientific Management, to which I have already referred, stated -

We are severely restricted in our powers to halt inflationary trends.

Surely a government with a sense of responsibility, which had seen this situation developing during the last few years, knowing ‘that it lacked powers, would take the people of Australia into its confidence and at least give them the opportunity to correct the position. The interesting thing is that the position of the Government has been getting worse as the years have gone by.

Senator Robertson:

– If our economy has slipped as badly as the honorable senator is trying to make out, how does he account for the fact that savings bank deposits are at the highest level they have ever attained?

Senator McKENNA:

– The honorable senator is looking at the figures in regard to depositors. She has to recognize that despite the fact that savings bank deposits have increased, there is a grave deficiency in the money required for the development of this country. The honorable senator must be fair and remember another factor. Until this Government made it possible, there were no private savings banks in Australia. There were only government banks interested in the savings banking field. The Government repealed section 28 of the 1945 Banking Act which prohibited private banks from embarking on other activities. To-day we find the private banks doing two things - moving into the savings bank field, which primarily was a government bank field, and moving out into hire purchase. The point I am leading to is that whereas some five years ago the banks provided some 56 per cent, of the credit of this nation, they are to-day, with this new development, providing not more than from 20 per cent, to 25 per cent.

Senator Robertson:

– Out of the people’s savings.

Senator McKENNA:

– Yes, but the point I am leading to is that the power of this Government to control interest arises under the banking power and not under any other. At one time, that power extended to some 56 per cent, of the credit provided in this community; to-day, it has gone down to about 20 per cent, or 25 per cent. I refer anybody who is interested to pages 141 and 142 of the report of the Joint Committee on Constitutional Review for evidence of that. That committee, comprising members of all parties, said this in paragraph 1065 of its report -

In all probability, internal finance accounts for around two-thirds of all finance available to business and over this the Commonwealth has no direct control. The remainder is credit, and, as the committee has stated, the Commonwealth now controls only a small and declining proportion of it through the banking power.

So, when Mr. Menzies tells the nation, in the Governor-General’s Speech, that he is going to exercise credit restrictions to withhold inflationary tendencies, it means he will be controlling roughly about one-fifth of the credit in the nation. He said in

Melbourne that he believed the Government had no power over hire purchase. I do not accept that altogether. The Commonwealth has power over financial institutions, and no attempt has ever been made by this Government to exploit that particular power. It is true that this power was narrowly construed by the High Court back in 1909, but a government which is moaning about lack of constitutional power for controlling credit might be expected - one would think, if it is a responsible government - to have a look at its power over financial institutions when such a vast amount of credit moves over to that field. The increase involved in hire purchase in this country is simply staggering. The Joint Committee on Constitutional Review dealt with that at length and pointed out that in a period of recession the obligation to make repayments could be a very damaging factor in getting industry going again.

Those are some of the factors. I have referred already to the undue emphasis this Government is giving to indirect taxation. I refer to the Tariff Board’s statement a few years ago that sales tax and pay-roll tax, which run out at about £200,000,000 a year between them, become £400,000,000 by the time they are translated into costs in this community. That is an inflationary injection into the community. What does the Government do about that, especially in the face of the advice tendered to it by the Tariff Board in which the Government professes to have great confidence?

I should like anybody who will do so to take the opportunity to refer again to paragraph 1067 on page 142 of the report of the Joint Committee on Constitutional Review. There will be found an excellent passage dealing with the effects of inflation at large. I have not the time at present to advert to it, but it is perfectly certain that everybody in the community is affected when inflation is abroad. In the short term, a few - and governments are amongst them - get an advantage, but even those few come a crash in the long term if inflation is allowed to run its course.

I want to refer now to some of the remedies proposed by the Government. The first is to lift import restrictions. I accept without question the position that they were imposed for the purpose of preserving our balance of payments position.

It would have been a breach of our international obligations under Gatt and the International Monetary Fund not to have done so. But they have become virtually a permanent feature of our economy. They were introduced in March, 1952, and we were told then that they would be lifted as soon as possible. Now, some eight years later, they are about to be almost totally abolished. Eight years is a very long period, and there is no denying that in the meantime a good many industries have sheltered under import restrictions as though they were a tariff. To borrow a phrase from Senator Spooner, that is one of the facts of life. But I think the Government has chosen an unwise time and an unwise mode in which to abolish them. After all, we are completely dependent upon our private industries for our balance of payments position.

Senator Maher:

– How are we going to absorb the tremendous increase in purchasing power?

Senator McKENNA:

– I have got only a few minutes left. We have heard from Senator McKellar of the difficulties that afflict the primary producer. He painted a very harrowing picture of those difficulties. The main bulk of our primary production is sold overseas, and when we look at what is happening overseas to-day, there are many causes for caution. We have the European Free Trade Association coming into being on 1st July. That association comprises seven countries. We have also the European Economic Community already operating. That comprises six major countries - Belgium, France, Germany, Luxemburg, Holland and the Netherlands. Both those organizations have agricultural policies. One objective to which they direct their purposes is selfsufficiency in connexion with agricultural products, and I see, as anybody who thinks must see, a period of danger ahead. And the Government chooses this particular minute, when these great forces are being marshalled, to lift import restrictions.

Senator Maher:

– How do you absorb the increased purchasing power released by those court decisions?

Senator McKENNA:

– If the honorable senator thinks that giving the wage-earner another 15s. a week-

Senator Maher:

– It represents £65,000,000 in one year, and that is a blow to the country.

Senator McKENNA:

– In total, it does, but I point out to the honorable senator that I have indicated to him the vast amount of reserves being paid by the people in prices to-day. These reserves represent £640,000,000 according to the white paper issued by the honorable senator’s Government. Does he not think there is room to accommodate most of that in a reduction of prices? Would not that be the desirable thing in the interests of not merely the working people but also industry itself in the long term?

Senator Maher:

– But prices are dictated by wage increases.

Senator McKENNA:

– I have very few minutes left, and I do not propose to enter into an argument with the honorable senator. As to import licensing, I merely want to say that it frightens me that we are going to allow in unlimited quantities of cheap-cost goods without ensuring that they are passed on to the people at only a reasonable profit. There is nothing that this Government contemplates to prevent importers becoming new entrants into the field of profits and price increases. What is there in the Speech, delivered by the Governor-General on behalf of the Government to indicate any contemplated action by the Government, and where is the power in the Commonwealth to prevent those who import goods from low-cost countries selling them to the people at prices just below those at which our own industries sell the same classes of goods? If these importers do that, how can it be argued that costs will be kept down? I think the Government has been unduly precipitate. I think it would have been better to have eased those controls off over a period, giving notice to our various industries and having some assessment made of the effect the entry cf these new importers into this particular field will have. Sooner or later this is bound to have an effect upon our trade.

The Government proposes to have a balanced budget. It would be a disgrace if it did not do so in a time of inflation, because the Government rides it all the time, getting its share of every increase in prices and in profits. The Government referred to restrictive trade practices, saying not that it would do anything about them but merely that the development of tendencies to monopolies and restrictive practices in industry had engaged the attention of the Government which would give consideration to legislation. It did not say that it would bring in legislation, but merely that it would give consideration. That is exactly like all the other promises that the Government has made.

I find that I cannot honour our arrangement and also talk at length. I say only that the Government has proposed nothing that is effective or that could be effective. The first cure for the situation is to get rid of this Government and get another, one that will do something effective and give the people action and not merely words. We have had from this Government incompetence, ineptitude, lack of leadership, promises galore, but no performance. In February, 1960, we found Mr. Menzies saying exactly the same things as he said ten years ago and even later than that. I shall conclude by repeating a statement that the Prime Minister made on 5th October, 1950, entitled “Rising PricesWhy? “ He said-

All that can be said against the present Government by its political opponents is that we have not so far, that is in nine months, arrested a process which went on at approximately the same rate during the last two or three years of Labour rule.

We of the Opposition can say exactly the same thing now, ten years afterwards. When is the Government really going to do something effective about the inflation that has been with us every day of its rule?

Senator PALTRIDGE:
Minister for Civil Aviation · Western Australia · LP

– At once I associate myself with the expressions of loyalty that are traditionally a part of this debate on the Address-in-Reply. I should like to extend congratulations to the new Governor-General and my thanks for the Speech that he delivered in this chamber. I hope that both he and Viscountess Dunrossil will enjoy their stay in Australia. I trust that their stay will be marked by a continuation of the mounting prosperity that this country has enjoyed over the last ten years.

I congratulate most warmly the mover of the motion, Senator Lillico. As has been remarked, his speech was not a maiden speech, but it was a characteristically thoughtful speech, which contained some most interesting matter. Similarly, I congratulate Senator Drake-Brockman on the manner in which he seconded the motion.

The Opposition has taken the opportunity to move an amendment to the motion for the adoption of the Address-in-Reply. As I understood it, this was to be an occasion for a rip-roaring attack upon the Government for its handling of the inflationary spiral. Having heard the Deputy Leader of the Opposition (Senator Kennelly), who opened the debate for the Opposition, and the Leader of the Opposition (Senator McKenna), I can only say that the attack, so-called, has not been vested with any of the power or the enthusiasm that we knew in other days. I am wondering why. Is this because one of the strange shifts in policy and tactics that so frequently occur in the ranks of the Opposition? I do not wish to offend the Leader of the Opposition at all. I merely say that the change in leadership that has occurred has not, apparently, introduced any change in tactics or any notable variation in tune. When the Leader spoke to-night, I had the feeling as, I am sure, did many others, that I had heard it all before; there was a ring of familiarity about it. I also thought that the Australian people had heard it all before, and had consistently rejected it. As was said by interjection by one of my colleagues, when Senator McKenna referred to the 1949 election, the Australian Labour Party was defeated at that election and it has been defeated ever since, still singing the same song, with which we have become so familiar, of depression and famine and pestilence and death.

Is it not strange that the picture that Senator McKenna drew to-night was of a country in which a motor car was no luxury. I got the impression of an Australia in which, I think, one person in four possesses a motor car, but all were standing on the brink of disaster. According to the Opposition, they have been standing there for a long time but nothing has happened.

Senator O’Byrne:

– They are waiting for the hire-purchase companies to repossess the motor cars. There is plenty of that going on.

Senator PALTRIDGE:

– Nothing has happened, despite the fact that this dismal song has been sung for so many years. I do not know what interest Senator O’Byrne, who interjects, has in hire purchase. I am not one who pays a great deal of attention to newspaper accounts. If I did, I would gather from some references in this afternoon’s newspapers that there is a greater knowledge of hire-purchase and its operations within the ranks of the Opposition than there is within the ranks of the Government.

I look back now, as the Leader of the Opposition did, over a decade, at the changing economic circumstances that have affected this country, at the various actions that the Government has felt constrained to take from time to time to meet those changing economic circumstances, and I remember the attitude that the Opposition took to those measures that we adopted, and how consistently wrong the Opposition was. The first major economic matter that came under my purview as a senator was the inflationary trend that was sparked off early in the last decade by the rise in wool prices.

Senator Henty:

– By the Korean war.

Senator PALTRIDGE:

– Yes, the Korean war and the consequent rise in wool prices. I remember the action that was taken by the Government to protect the economy from the inflationary effects of that boom. I equally remember the attitude taken by the Labour Opposition to that legislation, because although Senator McKenna says to-night - I took down his words - that it was a wise thing that was done at the time, he and those who sit behind him to-night, having berated the woolgrower for 100 years, could not get on the band wagon, fast enough to criticize the Government for taking that action and to pose as the friends of the woolgrower. The woolgrower, in his wisdom, treated with contempt the obvious political manoeuvre made then by the Labour Opposition led by Senator McKenna.

I go on a few years and remember another circumstance when we found it desirable and necessary to increase income tax, particularly company tax. As I recall it, we increased company tax by ls. in the £1 in one year. What was the attitude then of the Labour Party which, up to that point, had been the declared enemy of private commercial enterprise in Australia?

Senator McKellar:

– And still is.

Senator PALTRIDGE:

– Yes , and still is. Then the pose was to become the friend overnight of the companies. This crippling company tax which we were levying was going, to be the means of running out of business those good people who for years had given employment to so many good Labour men. And to-night those same companies, because of a shift again in the tactics of the Opposition, are once again, not those people who provide employment, not those people who by enterprise and skill and by exhibiting investment courage contribute to the progress of this country, but rapacious profiteers taking the blood of the Australian worker.

We had an interesting dissertation tonight about import restrictions. I have pointed out before that if there was one measure which should have won the support of the Labour Party when we introduced it, it was the measure imposing import restrictions, because in 1947 when Labour prepared its famous White Paper on unemployment, into that White Paper was written as a cardinal point the quantitative restriction of imports in certain economic circumstances. But when we did it then, in the particular year that we did it, it became the wrong policy; and to-night we are doing the wrong thing because we are. removing import restrictions.

Senator O’Byrne:

– You are always doing the wrong thing.

Senator PALTRIDGE:

– Well, the great sorrow with which I greet that remark is deepened only because I have listened to Senator O’Byrne say that for so many years and simultaneously seen him sit in his seat opposite me where he will be sitting for a good many more years to come. Then there was something said about deficit financing. Senator McKenna said to-night that it would be a disgrace if we did not balance our Budget next year and had not announced our intention to balance our Budget, at the same time presuming to have information that late last year inflation was with us and was then dangerous within the economy. But at that same time - on 25th August, 1959, the white hope of the Labour

Party, now its leader, had this to say when commenting on the Budget which provided, as honorable senators will recall, for a deficit of £60,000,000-

We believe that at certain times it is right and proper for the Government of the day to use bank credit. The present is such a time.

Where is there consistency within the Labour Party? What, policy does- the Labour Party pursue? Is it restricted purely and simply to criticism of the Government? Cannot the Labour Party find a policy of its- own? That, surely is at least part of the answer as to why Labour is still wandering in the political wilderness after being there for ten years.

Senator O’Byrne:

– Get off our back. Tell us what you are going to do.

Senator PALTRIDGE:

– I am going to do that, but I thought it might be interesting, particularly as we are on the air, to show the hollowness and hypocrisy of some of the things Labour supporters have said. I think we should look briefly - and only briefly - at a few of the things we have done over the last ten years. Possibly the most spectacular of those things has been the maintenance of the immigration policy.

Senator Ormonde:

– We started it.

Senator PALTRIDGE:

– I know that, and we have always acknowledged- it; I was on the point of saying so. But, my goodness, it has given you some pain since. I would like to be in your caucus room when immigration is discussed. Our immigration policy has surpassed anything previously undertaken in Australia. We have pursued a vigorous policy of national development, and it is apparent in every corner of the Commonwealth, in public works which are not only of real value at present but will also greatly benefit’ Australia in the future. Our policy of development has attracted factory after factory to this country in order to provide for the needs of Australians and to give employment to Australians. We have seen a remarkable capital inflow over the same period for private investment of some £800,000,000. I pause to ask myself whether this is not a test of the standing of this country among the nations of the world. There is no more final test than the willingness of other countries with money to invest to invest it in this country. I say, too, that while all these things have been going on, all within themselves having an element of inflation, desirable as they may be, real living standards have been progressively raised. No. better evidence of that can be seen than the real things that make for comfort that are now in people’s homes but were not there before. Consumer goods of all types are now available to people in the lower income brackets. Ten years before they would not have dreamed of possessing them. Most important of all, we have maintained full employment. We do not take the view that 5 per cent, of unemployment represents full employment. At the present moment, only 1.6 per cent, of the work force of Australia is out of work - a percentage which compares most favorably with that in any other country.

I have mentioned these things because I felt that Senator McKenna, in the early part of his speech, was attempting to point to some basic inaccuracies in the figures presented by Senator Spooner. If I accept the variations which the Leader of the Opposition has claimed should be made to those figures, I do not see that in any material sense they alter the import of what Senator Spooner said. They do not in any material sense alter the picture that he painted. In a speech, figures can become boring, but I notice that the Commonwealth Statistician is on record as saying that real wages have increased by Ti per cent, since this Government took office.

Senator McKenna referred to a statement which was made as recently as 21st February by the Prime Minister. I sometimes wonder whether this statement has been mistakenly accepted by the Opposition as the stimulus for the amendment to the motion which is now before us. I sometimes wonder whether the new leaders of the Labour Party, casting around for something to discuss at this session of the Parliament, did not seize upon this statement and attempt to make more of it than is actually contained in the document. I say that because the statement itself is no more than one of the characteristically candid, considered and reasoned statements that the Prime Minister makes from time to time to the people of the country on the state of the Australian economy. I’ propose to read three or four paragraphs to indicate the truth of my description of the statement. The Prime Minister said -

Last week Cabinet made a general survey ot the Australian’ economy. This is something we do at fairly frequent intervals. The previous occasion was just before Christmas. We always have before us a great deal of information on employment, production, consumption and investment expenditure, costs and prices, external trade and payments, monetary conditions and so on. After studying all these factors, we consider what, if anything, the Government should do to influence the situation in one way or another.

We find a good deal in our current position that is favourable and encouraging. The employment situation is particularly strong. Industrial production continues to rise. Although there has been drought in South Australia and some other areas, rural output will, as a whole, be quite high. We are having a good export year. It looks as though the total value of exports will be well above £900,000,000. More imports are coming in and helping to increase the supply of goods and materials.

But there are other tendencies which are perturbing. The most serious of these is the rise in costs and prices. In some degree this has been going on for a considerable time, but in recent months it has become faster and it is now decidedly too fast. Our aim - we believe the aim of everyone and not only of the Government - must be to slow it down and bring it to a halt. We say that unequivocally, because we reject the view that a rise in prices and costs is harmless so long as it keeps within “ reasonable “ limits. We believe that, on all counts, we are better off with a stable level of prices and costs.

The rise in prices which has occurred has been due principally to causes within our own economy. For a long time past, import prices have been virtually stable. Export prices, it is true, have risen during recent months and this has probably helped to raise the local price of some articles.

I particularly invite the attention of the Opposition to these words -

But in the main it has been a process of adding, one on- top of the other, a great many particular increases in wages, profit margins, charges and the like, some large, some small, but all contributing to a general upward movement that has grown faster as it has gone on.

This candid statement encompassed and acknowledged the- very thing which the Opposition would have the people believe we propose to ignore - the addition to profit margins. The Prime Minister then stated plainly - as he did again when he addressed a conference of business people in Melbourne some little time later - what the true position is. Having described the economic situation- as it is, the Prime Minister- went on to state what the Government proposed to do to meet the situation. First, there was the appearance before the commission of the Commonwealth, putting the point of view that at this particular time an addition to the basic wage structure could have nothing but a damaging effect on the economy generally. We believe that, so, with a sense of responsibility, we believe that it is our obligation to advocate to the commission that the economy should not suffer by virtue of another rise. The Leader of the Opposition, and indeed the members of the Opposition generally, took exception to that course.

Senator Ormonde:

– What about profits?

Senator PALTRIDGE:

-I will deal with them in a minute. What are the facts? The facts are that last year there was a basic wage increase of 15s., followed almost immediately by the margins increase of 28 per cent. and consequent increases. Now there is another basic wage application before the commission. I say to the Senate that, in the name of common sense - not of political philosophy, economics or anything else - rises of that nature, coming one after the other, must be digested before other increases are granted if there is not to be grave distortion within the economy. Holding that view, the Government, out of a proper sense of responsibility, has expressed it to the court. When Senator McKenna says that such an action can only result in some disadvantage to the wage-earner I differ from him emphatically. Money wages are not important, but real wages are. If a wage-earner or anybody else is to see his increased income dissipated - run into the sand like water - because of increased prices, then it is far more advantageous to the wage-earner to hold the level of wages and prices and the level of real values - rather than chase a mythical increase.

The Prime Minister (Mr. Menzies), referred to the Government’s agreement with the policies applied by the Reserve Bank. Senator McKenna did not say anything about this aspect of the statement. I wonder why? What would be the policy of the Labour government - presuming there were a Labour government - in respect of bank liquidity at this moment? I ask Senator McKenna to tell me by way of interjection. I ask any honorable senator who follows me in this debate to tell me what would be the policy of a future Labour government. Would such a government agree with the action taken by the

Reserve Bank? Will somebody tell me? What about budget finance? What about deficit finance? How frequently have we sat in this chamber and listened to the continuing wail from the Opposition about the shortage of money for public works, Commonwealth and State. What is the real policy of the Labour Party in respect of deficit budgeting? Will it state its policy? The Opposition twits us about our policy. I pose those questions to the Labour Opposition, hoping that somebody will provide answers because the answers are not to be found in a series of statements criticizing the present Government. If our policy is wrong there must be alternate policies. What are they? Nobody has revealed them.

Senator McKenna:

– They will be revealed at the appropriate time.

Senator PALTRIDGE:

– I heard an honorable senator opposite mention the La Trobe by-election. Perhaps that by-election will afford the Labour Party an opportunity to state what its positive policies are in respect of these matters. It has not done so yet.

Senator McKenna:

– We do not want to tell you.

Senator PALTRIDGE:

– I am sure you do not. Nor does the Labour Party want to tell us. It avoids telling us or anybody else. But it cannot go on avoiding the issue. If it is to be the alternative government it has to state its policies. All we hope is that the Labour Party will tell us, and through us the people of Australia, what are the answers to the questions that I pose.

I have only a little time left in which to speak. I regret that, because far from getting off the Opposition’s back I had hoped to get on its back rather more. Let me say this and end on a positive note. As far as this Government is concerned, through what is almost a decade now we have not felt ourselves firmly bound by any doctrinaire policy of socialism or any other ism such as the Labour Party espouses. We have had to meet changing economic climates through ten years, and I claim that we have done so with flexibility and reasonableness. We may have made minor mistakes along the way - no doubt we did. No government is perfect. I have never heard that claim made for any government except the claim that has been so consistently made for the Labour Administration that failed so dismally in 1949. We have met these changing economic climates with flexibility and reasonableness and I claim that we have succeeded. I express the belief and the hope that if we continue to do that we will continue to receive from the Australian people a manifestation of their satisfaction, and that our policies will be endorsed at succeeding elections.

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

– I join with other honorable senators in extending felicitations to Her Majesty, the Queen, and the Duke of Edinburgh on the birth of their son. I think now is an appropriate time for the women in this Senate to raise the subject of the rights of women, because now the Royal daughter has been relegated to third in line of succession. Now would be a time when the rights of women could be brought forward very forcibly by our lady senators.

I wish to welcome Lord Dunrossil and his good lady to this country. I hope that they will enjoy their stay here, both for their own sakes and for Australia’s sake. 1 wish to congratulate Senator Lillico, the mover of the motion for the adoption of the Address-in-Reply, on the excellent speech that he made. It is rather peculiar that Senator Lillico should come from the same district as me.

Senator Wade:

– He makes a good speech.

Senator COLE:

– He does. He has been in the Senate only about twelve months, but has already had the honour of moving a motion for the adoption of the AddressinReply, whereas I have been here for ten years and I am still waiting for the honour. I think it will be quite t>. long time before T have that honour.

I did not think that the Speech of His Excellency, the Governor-General, was very inspiring so far as substance was concerned. The Government did not put forward anything very definite that would inspire confidence in the people of Australia. Take as an example the subject of rising costs and prices, which is a subject very close to the people. The only reference in the Speech to this subject was an undertaking that the Government would decide on a certain course of action. That was a very indefinite statement, and it would be interest.ing to know what that course will be. The whole Speech, except for the enumeration of what had already been done, and quite creditably done, was too vague and too indefinite.

I propose to deal with certain points made in the Speech. I will deal with them mostly in the order in which they were placed by the Government, not naturally in order of importance. The Government mentioned first the Colombo Plan and its proposal to continue to support that scheme. At this point I should like to praise the work of Mr. Casey when he was in charge of Australia’s participation in the Colombo Plan. He did a great job in that field. I think more should be done to help the people of Asia, under the Colombo Plan. This wonderful scheme is not only helping the under-privileged people of that continent, but is also of very immediate benefit to Australia. That benefit lies in the fact that we are guiding those people to a rising standard of living. The money we spend on the Colombo Plan is money very well spent.

The Governor-General’s Speech also contains reference to the Government’s defence policy. The Government is re-organizing our defences. But I believe that it acted badly in deciding to abolish compulsory military training. That scheme formed a basis for the training of our youth not only in the use of arms but also in the art of self-determination. We need to remember that, with atomic weapons spreading throughout the world to the various powers, the likelihood of an atomic war is receding. There will still be localized wars, however, which I think will be fought with conventional weapons. For that reason, we in Australia cannot afford to abandon training in the use of conventional weapons. The Government should look into this matter as it proceeds to re-organize our defence forces.

I know I am being a little parochial, but I think Tasmania is being insulted in the re-organization of our defences. No longer have we the 12th and the 40th battalions - those two great battalions which fought so wonderfully in two world wars. They have been almost wiped out, as peacetime units anyhow. Tasmania is to have, besides a few ancillary units, a couple of rifle companies which will work with the forces in Victoria. I repeat that that is an insult to Tasmania. Over the years, whether it be by voluntary or compulsory training, Tasmania has been able to support two battalions. The proposed rifle companies will have officers of correspondingly lower rank, with the result that men will not have the incentive to try to rise in the ranks. I think the highest rank will be that of major. I ask the Government to re-examine this matter.

Now I come to the subject of rises in costs and prices, which has led to a great deal of discussion in this chamber. Whether or not we should blame the Government for inflation is another matter, but I think that to-night Senator McKenna presented a good history of and a reasoned argument about inflation in Australia. There has been a sudden increase in wages. Wages definitely have a very important bearing on the cost structure. I am of the opinion that our action in increasing our parliamentary salaries has triggered off this surge of increases, and that it could even have something to do with the thinking of members of the Commonwealth Arbitration Commission. We gave ourselves a huge rise in salary. We who are supposed to control inflation or who are responsible for the government of this country set an example which naturally other people will follow. For that reason, I cannot see how we have the right to prevent people in the lower income groups from bettering their position.

If we think wages are getting out of hand, what is wrong with our setting a good example by agreeing to a 20 per cent, cut in the increase we received? We have set a bad example and have seen the results. If we were to agree to a 20 per cent, cut in the increase of our salaries - not of our allowances - we would be adopting a reasonable approach in our efforts to stop this sudden surge in wages. If the Government tries to prevent a rise in prices by legislative means, it will cause trouble and heartburn. But I am afraid that, if the rise is not stopped, our overseas balances will fall and we will be priced out of overseas markets. I know that the Government appreciates that that is the important point, but as I have said, it set a bad example.

The people who are most hurt by rising prices and salaries - and, of course, increases of salaries cause prices to rise - are those on fixed incomes. They are the people who suffer most from the inflationary trend. The Government has appointed a committee to consider various aspects of taxation. I suggest that one of the first things that the Government should do, if it wishes to reduce costs, is to abolish the payroll tax. It cannot be denied that pay-roll tax inflates prices. The Government could help the family man, who is feeling the effects of inflation more than any one else in the community, by abolishing the sales tax. The question may be asked: How would you make good the loss of revenue if those two taxes were abolished? I believe that income tax is the fairest tax that can be imposed on the people. An increase of income tax would make good the loss of revenue that would result if the pay-roll tax and the sales tax were done away with, assuming, of course, that the Government really needed to make good the loss of revenue. The people like to know what they are paying in taxes, and I should like to see the position openly stated.

The subject of social services was referred to by the Governor-General in his Speech. No definite statement was made in this respect; it was merely stated that all the benefits would be kept under review. For many years I have tried in this Senate to have an independent committee or tribunal appointed to examine social services legislation and pensions, but I have never succeeded. The Government has seen fit to appoint an independent committee to investigate taxation matters, and I cannot see why it is not possible to appoint a similar committee to study questions related to social services. After all, if it did so it would be merely applying the policy of the Australian Democratic Labour Party, a policy which it has applied in respect of other matters, as I shall indicate later in my remarks.

In view of the great increase of prices and wages, the Budget that will be presented later in the year should provide for a big lift in rates of pension. It is essential that pensions be increased if pensioners are not to be in even worse straits than they are to-day. The Governor-General’s Speech referred to the means test. I hope that the

Government does not merely ameliorate the means test and forget all about the pensioner on the base rate of pension. If it does so, it will be unfair to those people who have no income other than their pension, although I admit that liberalization of the means test would help people on fixed incomes. It is about time, of course, that those who depend on superannuation and other forms of fixed income were shown some consideration by this Government. I am pleased to know that there is a good chance that the means test will be substantially modified in the next budget session of the Parliament.

It is time that the Government gave effect to the policy announced away back in 1938 and introduced a national insurance scheme. The introduction of such a scheme is perhaps the only way to overcome the need for a means test. If we had a national insurance scheme, perhaps we could provide decent conditions for the old people of this country in the eventide of their lives.

His Excellency’s Speech stated that a marriage bill would be introduced during the current sessional period. That seems to me to be a back-to-front procedure. The Government has already introduced the iniquitous divorce legislation. I thought one had to be married before one could be divorced. I cannot understand why the marriage bill was not introduced before the divorce bill.

Reference was made in His Excellency’s Speech to the subject of housing. I must give praise to the Government for providing money for housing, money which goes a long way towards meeting the housing needs of the people of Australia. It seems to me that it is mainly government money that is now used to build homes for Australians. The provision of £80,000,000 by the Government in this financial year for this purpose is praiseworthy. I do not blame this Government so much as I blame the ineptitude of State governments for the housing lag. It is said that we need cheap money for housing. Yet, we find that the State governments push up the interest rates on money that is provided by the Commonwealth.

Senator Sheehan:

– The honorable senator must remember that the Commonwealth charges the States interest.

Senator COLE:

– I know. I am about to deal with that aspect. The Commonwealth Government lends, at 4 per cent., money to the States for housing, and the treasuries in the States pass the money on to the various banks, such as the Agricultural Bank of Tasmania. The State treasuries charge the banks one-half of 1 per cent, interest for doing so, thereby making a profit on the money that the Commonwealth Government has passed to them. Then, when the banks pass the money to building authorities, such as cooperative building societies, they charge one-quarter of 1 per cent, interest on the transaction. If the Commonwealth Government dealt directly with these co-operative building societies, it would save i per cent., which would represent a considerable sum over the period of repayment. I am very pleased indeed with the Government’s support of co-operative building societies which are doing an excellent job in housing the people. I am firmly convinced that if a greater percentage of the money made available to the States for housing were allocated to such societies the people would be housed quicker and much more value would be obtained for the money expended. There are a few people who cannot provide a home for themselves because they lack the meagre deposit required by these societies, and that is where the Government should provide housing. But these people number very few, and I congratulate Senator Spooner on the great work he has done for the building societies in Australia.

The Governor-General’s Speech mentioned the report of the Constitutional Review Committee which suggested amendments to the Constitution. I venture the opinion that an attempt will be made within the near future to implement the recommendation relating to a reduction in the powers of the Senate. If that recommendation is implemented, the Senate will become a House of very little consequence in Australia. Whatever might be said about the Senate now, it is a House of some consequence in the scheme of things in Australia; and I am certain that the founders of the Constitution intended that it should be a House of some consequence. I shall be very disappointed indeed if my fellow senators agree to any reduction in the powers of the Senate. I go so far as to say that if the powers of the Senate are decreased-

Senator Branson:

– They will not be.

Senator COLE:

– I am not so sure. There is too much party consideration within the Senate for the position to be healthy. For instance, the Labour Party advocates the abolition of the Senate. There might be a strong fight on the Government side if a number of the members of the Liberal Party do not agree with a reduction in the powers of the Senate and the Government insists that they should be reduced; but I warn honorable senators now that if any attempt is made to decrease the powers of the Senate, I shall move for the abolition of the Senate.

Another very important matter relates to monopolies and restrictive trade practices. That proposal has been taken from the policy of the Democratic Labour Party.

Senator Hannan:

– Break it up!

Senator COLE:

– That has been part of our policy for some time.

Senator Tangney:

– When a Labour government was in power in Western Australia, the Parliament passed an act for that purpose and a Liberal government repealed it.

Senator Hannan:

– There has been an act on the Statute Book since it was passed in 1910.

Senator COLE:

– Then it is time it was implemented.

Senator Hannan:

– I agree with you there.

Senator COLE:

– This proposal to restrict monopolies is extremely important. The Labour Party says it does not believe in monopolies, but I point out that it believes in socialization and, after all, socialization means nothing more than the establishment of a State monopoly. There is no difference between a State monopoly and a private monopoly. Indeed, I should say that a State monopoly would be worse than a private monopoly.

Senator Tangney:

– When did you find that out?

Senator COLE:

– There have been many State monopolies, the efficiency of some of which could be questioned. Monopolies must be curbed; I hope that the Governmen will do something to curb them and not just look into the matter.

The decentralization of population and industry is essential if Australia is to progress and expand as it should. But I believe that before transferring industries and population from the big cities, we must ensure that the economic climate is suitable for taking that step.

As to shipping, first I congratulate Senator Paltridge on what he has done for Tasmanian shipping. The putting into operation of “ Princess of Tasmania “ has made it possible for ignorant people from Victoria and other places to see a new country. Further, “ Bass Trader “ will soon be in commission. Senator Paltridge would seem to have a soft spot for Tasmania, and I can asure him that he will be welcomed over there. As Minister for Civil Aviation, he is doing something for that State. At the moment officers from Trans-Australia Airlines are touring Tasmania with a view to ascertaining the type of aircraft best suited to the promotion of tourist traffic to that State.

While speaking of Tasmania. T should like to refer to one or two parochial matters. One relates to the potato industry which was dealt with very fully by Senator Lillico. This very important industry is in need of a great deal of organization. Then, there is the Tasmanian pea industry. It could be helped a great deal by the provision of more refrigerated ships. Two nights ago, I heard over the air that there is a great potential market for frozen peas in the United Kingdom where, it is believed, at least 3,000,000 lb. of frozen peas could be marketed each year. That is about equivalent to the output of the largest frozen-pea factory in Tasmania. The fostering of this industry would be a great boon to primary producers. We really need a good refrigerated ship. We have not such ships on the Australian run, and I should like the Minister for Shipping and Transport (Mr. Opperman) to do something about having one built. Frozen peas must be kept frozen, whereas apples are kept at a temperature that is above freezing point and are transported in what are really only cool stores.

I hope that the Government will do something to assist the apple industry, which will be confronting great difficulties. It would be a good thing if the Commonwealth, in conjunction with the Tasmanian Government, were to set a cost price on apples. I understand that this year apples will be sold at a price that is below cost of production. This, coupled with the hail damage that has been suffered in the Huon Valley and other places, will make it difficult for the orchardists to carry on. Any help that the Government can give would be greatly appreciated.

Senator Kendall:

– Are not apples sold by auction?

Senator COLE:

– They are sold f.o.b. on the wharf. Apples are a great sterling earner, and it would be a pity if the industry were lost to Australia.

We hear much from the Australian Labour Party, newspapers, and such people as Lord Verulam about the recognition of red China. We all know that communism is the greatest danger in the world. We should know also that red China, under its present regime, is the greatest danger facing Australia. Yet the people I have mentioned urge recognition of red China and the establishment of trading and cultural relations with it. We, as a Christian nation, know that communism will be defeated ultimately. I believe that that defeat will come from an explosion within the Communist countries, but it is our duty to contain communism unless we want to suffer in Australia what has been suffered in the countries that are now behind the iron or bamboo curtains. When people talk about more trade with China, do they realize that trade is just an economic weapon to the Communists? When they talk about recognition of red China, do they realize that recognition would mean the rape of Formosa? What are the cultural relationships that it is suggested we should foster with red China? Would they include the learning of the technique of brain-washing, by which people are robbed of their minds? Would they include learning how to run slave camps, which people enter with no hope of salvation? Would we learn how to destroy family life by collectivization, whereby children are taken away from their parents and reared by the State? Do we believe in these things? Do we want to learn how to destroy the churches and the temples so that the people will forget there is anything other than the material things of life? Do we want to learn how these people care for their aged folk? Perhaps I may read an extract from a pamphlet that I commend to those people who advocate the recognition of red China. It is a record of a con sultation with five Protestant ministers of religion from China and is entitled, “ Communist Persecution of Churches in Red China and Northern Korea “. It is a very interesting publication, consisting of questions and answers. It details how the Communist Chinese care for their aged.

Senator Kendall:

– They care for their aged better than any other country does.

Senator COLE:

– You are talking about Communist China?

Senator Kendall:

– Yes, both Chinas.

Senator COLE:

– Here is an extract from this pamphlet -

All the elderly people 60 years of age and above who cannot work are put in the old people’s “ Happy Home “. After they are placed in the homes they are given shots. They are told these shots are for their health. But after the shots are taken, they die within two weeks. After they die, the corpses are placed in vats. When the bodies decay and maggots set in, the maggots are used to feed chickens. The remainder of the body is used for fertilizer.

Senator Courtice:

– They have certainly pulled your leg.

Senator COLE:

– The honorable senator should read this pamphlet, which is a record of a consultation with five Protestant ministers. Is this the sort of relationship the fostering of which is urged by those people who advocate recognition of red China?

Senator Courtice:

– The United Kingdom wants to recognize red China.

Senator COLE:

– That is what is wanted by people like Lord Verulam, who seeks trade with that country. We know that he is the head of a great steel mill in England. Those people who advocate recognition of red China would sell their birthright for a mess of pottage. Finally, Mr. Deputy President, I wish to speak about Mr. Calwell and the present new look in the Labour Party. I notice that the new look was not towards the Democratic Labour Party.

Senator Cant:

– Why should it be?

Senator COLE:

– I remind Senator Cant that this afternoon Senator O’Byrne eulogized Dr. Evatt, the former Leader of the Australian Labour Party. What amazed me was that when it was thought Dr. Evatt would be appointed to a judicial position in New South Wales, no member of the Australian Labour Part) anywhere in Australia got to his feet and said, “ Do not take it. We cannot do without you “. They were wishing that he would take the position, and he did, to the great joy, of course, of most Labour members within that party. Now, Mr. Calwell is being reported by the newspapers as saying continually “We are not having anything to do with the Democratic Labour Party at all “. Well, we have not asked him about it. First of all, we want to know whether he is willing to agree to the things we have set out for his agreement. Honorable senators will remember that the first thing we put forward referred to trustworthy leadership. Well, we got rid of one leader at least whom we thought was untrustworthy, and now we have to see whether Mr. Calwell has the trust of the people of Australia.

In to-day’s “ Sydney Morning Herald “ there is a well written article by Dr. Lloyd Ross, which I advise honorable senators to read. Under the heading “Labour at the Crossroads “, he states that Labour has to get a new look, but he wonders how that new look is coming about. The article goes on to state -

  1. . the voters who left Labour did so because they believe Labour policies were suspect, uncertain,–
Senator Tangney:

– Is that why he left the Communist Party?

Senator COLE:

– He is one of the leading members of the Labour Party and is on its executive.

Senator Tangney:

-No, he is not.

Senator COLE:

– Yes, he is. The article goes on - or unrealistic.

So,I say to the members of the Australian Labour Party: If you need the help of people who support us to win elections, do not think you are going to get it merely because a change of leadership has occurred. You must change your policies. Even one of your leading men has told you that in to-day’s newspaper. You have to go to the party and do the things that we asked you to do before. One, of course, referred to leadership. You have gone a little way along the line. You have done that - or we did it for you.

Senator Sheehan:

– What was that one?

Senator COLE:

– About the leadership. Now go on with the rest, including the adoption of a decent foreign policy to safeguard Australia. I have already told you what you are doing in advocating the recognition of red China.

Senator Courtice:

– What about red Russia?

Senator COLE:

– It applies to red Russia, too. You have to go on with Labour’s traditional fight against communism in the unions; and no unity tickets. I do not know whether your leader is going to change or not. He has continually denied that there have been any unity tickets. Well, it may be that he will have the strength to grasp the nettle, as Dr. Lloyd Ross has said, and do something about it.

Senator Cant:

– Do you mean there will be no unity with the Democratic Labour Party?

Senator COLE:

– If you want me to tell you the truth of the matter, I will do so. When your leader appeared on television in Victoria, he said there would be no unity tickets if it were not for the Democratic Labour Party and that Labour had to join in a unity ticket with the Communists, otherwise the Democratic Labour Party would take away the unions’ terms.

Senator Ridley:

– Is that a direct quote?

Senator COLE:

– That is exactly what was said on television. If those people observe democratic rules, as they should, but which they did not do at Hobart, probably something could be done to help you along a little bit, but I am afraid that under your present scheme we will have to wait and see.

Senator Courtice:

– You will have to get rid of the leader first.

Senator COLE:

– Which leader?

Senator Courtice:

– The leader of the Democratic Labour Party.

Senator COLE:

-I am afraid that would be so under the present circumstances. I am very pleased, Mr. Deputy President, to be present to consider the AddressinReply, and I hope, as I said before, that there will be very close ties between Australia and the Crown for many, many years to come.

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

– I join with all honorable senators who have expressed loyalty to Her Majesty the Queen and referred to the great delight with which the people of Australia heard of the birth of a new prince and of the royal engagement. With others, I also express my appreciation of the manner in which His Excellency delivered his Speech at the opening of the current session.

Mr. Deputy President, I wish to refer to one matter which Senator Cole mentioned during his address. I join with him in saying that the people of Tasmania are deeply appreciative of the inauguration of the “ Princess of Tasmania “ service which has had such a vast influence on Tasmania’s economy during the last few months. Sir, all manner of people throughout Tasmania to whom I have spoken about this matter, including proprietors of service stations, motels, hotels, snack bars and those engaged in other industries, give great credit to the Menzies Government for inaugurating this service which has brought prosperity to Tasmania, particularly to the little man in that State. This vessel has( brought many thousands of tourists to Tasmania, and they have all spent money in that State. In addition, “ Princess of Tasmania “ has provided a regular service and carried goods at cheaper freights. These things have meant a great deal to both rural and manufacturing industries in Tasmania.

Senator O’BYRNE:
TASMANIA · ALP

– You have forgotten one thing.

Senator HENTY:

– I have forgotten nothing. I have not finished yet. One other thing I want to say is that lower freights and regular services have triggered off one of the greatest industrial developments that we have seen in Tasmania for a considerable time. Following cheaper freights and regular services, we have seen the establishment of a steel industry by Broken Hill Proprietary Company Limited at Bell Bay and of paper mills at Dover and Wesleyvale. Other industries will follow. That development was triggered off by the cheaper freights and regular shipping services for which we in Tasmania have been asking for many years. The people of Tasmania - particularly the little people - are grateful to the previous Minister for Shipping and Transport for what he did in this matter, and they are grateful to the Government for finding the necessary money.

I now wish to mention the addition that the Opposition proposes shall be made to the Address-in-Reply. Frankly, I think it would be far better without that addition. If the amendment moved by the Opposition were accepted, the AddressinReply would state that we desire to advise His Excellency that the Government no longer possessed the confidence of the Parliament and of the nation because of its failure to halt inflation, its action in lifting import restrictions and its decision to ask the Arbitration Commission to reject the current application by the trade union movement for an increase in the basic wage.

Sir, I think it is ludicrous that the Government should be accused by the Opposition of failing to halt inflation, and then berated by it for taking steps which would halt inflation. The Government believes that it is in the best interests of the people of Australia that the Arbitration Commission should be told that, in the Government’s opinion, the economy should be allowed to digest the 15s. increase in the basic wage and the recent marginal increases, and that we should see what effect those increases have on our industries, particularly our rural export industries, before we go any further. I believe that it is proper to put that view to the commission, and that the Government is acting in the best interests of the Australian people in doing so, but we are berated for doing that, although it could be one of the means, in conjunction with the other steps we are taking, of halting the present position.

Senator Courtice:

– What are the other steps?

Senator HENTY:

– If you cannot read, I shall tell you all about them in the limited time at my disposal. Another step which the Government has taken is to lift import restrictions. Ninety per cent, of the import restrictions will be lifted. For years the Opposition has berated the Government for imposing import restrictions.

Senator Wade:

– In season and out of season.

Senator HENTY:

– Yes, in season and out of season. Now it says that we are wrong in lifting them.

Senator Wade:

– They want to have a bob each way.

Senator HENTY:

– A couple of bob each way. From the speeches of honorable senators opposite anybody would think that the lifting of import restrictions amounts to abandoning the protection of Australian industry. Of course, the lifting of import restrictions will not take away protection from Australian industry. The protection for Australian industry is the tariff, and a rate of tariff is decided after a proper public hearing, at which anybody can give evidence, before the Tariff Board. The board recommends the rate of tariff which should be imposed in order to protect an Australian industry. That is the proper means of protecting Australian industry. It has been made clear to the people of Australia, ever since the inception of import restrictions, that those restrictions were imposed to protect our overseas balances, and for no other reason. The Government has said that, not once, but over and over again at election after election. It cannot be said that we did not tell the people of Australia that import restrictions would not be used to protect Australian industries.

What does the lifting of import restrictions mean? It means that there are now alternative, and possibly cheaper, sources of supply of the raw materials that we use. If materials can be purchased more cheaply, that will assist Australian industry to offset rising prices and rising manufacturing costs flowing from the marginal increases and from the basic wage increase. In addition, importers can now get their supplies by importing directly through their own importing organizations. Those who had import licences and were charging a distributor’s rate of profit for acting as brokers are no longer in the picture. Those intermediary costs will be removed. I have great hope that, with the lifting of these restrictions, greater competition in the retail business will bring cheaper prices. I think that what the Government has done will help considerably to ease the position we are in to-day.

I do not see that the position gives cause for panic. I was interested in the speech made by Senator McKenna. He quoted from the Arbitration Commission’s judgment and said that he was 100 per cent, in agreement with the commission’s point of view. He said that the basic wage increase was granted by the commission because the commission did not think the increase would affect the economic stability which this country had achieved. I agree that this country has achieved sound economic stability. If any one doubts that, I think he should look at some of the improvements in conditions that have taken place in the last ten years.

In 1950, for every 100 Australians there were ten motor cars. In 1960, for every 100 Australians there are eighteen motor cars. Please do not mention hire purchase to me in this connexion, because, as one honorable senator on this side of the chamber has already said, we are quite convinced that honorable senators opposite know more about hire purchase than do those on our side. In 1950, there were approximately nine refrigerators to every 100 persons in Australia. In 1960, there are 30 refrigerators to every 100 persons.

Senator Ridley:

– What were those factories making previously?

Senator HENTY:

– The housewife is not interested in what they were making previously; she is interested in the fact that there are now more refrigerators in Australian homes. In 1950, there were eight washing machines for every 100 persons; in 1960, there are twenty washing machines.

Senator Ridley:

– Not enough.

Senator HENTY:

– But it was a very great improvement on the position as at 1950 when we took over. Also, in 1950 there were no television sets in Australia. To-day two out of every three homes in Sydney and Melbourne are furnished with television sets. Those are significant advances in the prosperity of the people of Australia in that ten-year period.

I was particularly interested is one statement made by Senator McKenna wherein he said that taxation was so high that the people were unable to invest amounts comparable with those invested by people in other countries. I have before me details of the capital re-investment of the gross national product in seven countries. It is not without interest to find that to-day Australia has the highest ratio of re-investment in industry - 25 per cent, of the gross national product. For the other countries about which I have information the figures are -

The only country whose figure equals that of Australia is Russia, where the ratio is also 25 per cent. So Senator McKenna’s argument falls to the ground when he says that taxation is so high that the people cannot re-invest as much as do people in other countries.

I was most interested to hear an admission from the Opposition that inflation was a rushing bushfire inflation long before this Government ever came to office.

Senator Wade:

– The Leader of the Opposition said so.

Senator HENTY:

– I am not worried about this being said by the Leader of the Opposition in this instance. I was most interested to hear another honorable senator give us the picture. He apparently knew what he was talking about because he had been a union advocate in the court. He said that in early 1948 he had an application before the Arbitration Court for a basic wage of ?7 a week. By mid- 1948, six months later-

Senator Ridley:

– I did not say that.

Senator HENTY:

– I have the honorable senator’s words before me. He said that by mid- 1948 a supplementary claim had to be made seeking a basic wage of ?10 a week - a rise of ?3 a week in a period of six months.

Senator Ridley:

– I said midway during the hearing of the case - not midway during 1948. The case was on for four and onehalf years.

Senator HENTY:

– As reported in “ Hansard “ the honorable senator said -

About mid-1948 the period of galloping price rises commenced and the basic wage started to go up by leaps and bounds;

I think it went up by over ?2 in one year.

Senator Ridley:

– It went up by 39s.

Senator HENTY:

– That was in 1948 when the Labour Government was in office. Senator Ridley said that this occurred about mid- 1948. This was at a time when Labour was in office with its planned economy, an era when there was an application for a 50 per cent, rise in the basic wage.

Senator Ridley:

– You are misquoting me and you know it.

Senator HENTY:

– I have quoted the honorable senator’s exact words. Over and over again we on this side of the chamber have asked what is the alternative, what is Labour’s alternative to the measures that we as a Government have put forward. What is Labour’s alternative to a reduction of bank credit, a reduction in Government spending and a balanced budget? We have put forward our plans. Labour has criticized them. Labour has one great cure. It will have a referendum to seek more powers for the central government at Canberra. That is why the people threw Labour out of office eleven years ago. The people would not give Labour the powers that it wanted in Canberra. The people of Australia are very canny. Labour’s only cure is a referendum to seek more powers. Powers for what?

I should like to read the leading article from the Hobart “Mercury” of 10th March, 1960. It reads -

In fact the Government cannot be blamed for “failure to stop inflation” for its powers are strictly limited. It has adopted a balanced-budget policy, begun a credit “ squeeze “, and freed imports to provide price competition. Farther than that it cannot go. It cannot control the economy in detail, but merely apply pressure here and there.

Mr. Calwell tacitly admits this ; as he is bound to do if he is quite honest about it - and has invited the Government to seek more constitutional powers. He has offered Labour support to get these powers. Naturally, Labour would be all for this proposition, for it would bring within reach the planned Socialist economy which is the party aim.

The people had a taste of planned economy during the war; they can hardly have appetite for more. It was a period in which departments decided what industries should or should not operate, where men should work, and how they should spend their money. It was a period of wagepegging, price control which did not hold prices, and rationing used after the war as a cover for incompetence. When Mr. Calwell wants more controls these are what he means; there are no others.

The economic powers which Labour wants should be permitted only in dire emergency. The country now faces an economic problem - not a national emergency - and it will surmount it under a free economy as it has surmounted others. There is no need for Labour to rush the lifeboats; Australia will not sink.

Those are sentiments with which I heartily agree. Labour’s only proposal has been to hold a referendum to seek more powers. What will Labour do if the people refuse to give it those powers? Labour will be bankrupt without any policy and with nothing at all to do. Over and over again the people of Australia have refused to take those powers from the States and place them in the hands of the central government in Canberra because they know what would happen once a socialist government here got hold of those powers. They know the controls that would be placed on them. They are not prepared to trust Canberra with those powers.

Mention has been made of the report of the Constitutional Review Committee. I think the least said about that the better. The recommendations in the report would greatly assist the Labour Party to obtain centralization of government, the abolition of State governments and all that it wishes to do in its economic proposals.

Debate interrupted.

page 210

ADJOURNMENT

The PRESIDENT (Senator the Hon. Sir Alister McMullin). - Order! In conformity with the sessional order relating to the adjournment of the Senate, I formally put the question -

That the Senate do now adjourn.

Question resolved in the affirmative.

Senate adjourned at 11 p.m.

Cite as: Australia, Senate, Debates, 16 March 1960, viewed 22 October 2017, <http://historichansard.net/senate/1960/19600316_senate_23_s17/>.

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