Senate
8 December 1960

23rd Parliament · 2nd Session

  1. Senate
  2. 23rd Parliament
  3. 1960

The PRESIDENT (Senator the Hon. Sir Alister McMullin) took the chair at 11 a.m., andread prayers.

page 2195

WORDS USED IN DEBATE

Senator KENNELLY:
VICTORIA

– by leave- During, the debate on the sales tax measures yesterday I mentioned certain matters about which I had heard rumours. Then, following some interjections, I said other things which I realize now, after consideration, could reflect on a man’s character. I wish to. withdraw unreservedly anything which may have reflected on a man’s character. I play the game: tough and I like it to be played tough, but nothing would hurt me more - 1 really mean this - than to think that I went out of this House having made a personal enemy because something I had said had reflected upon a man’s honour.

I say to Senator Wright that I withdraw unreservedly any imputation of wrongdoing on his part. In the first part of my speech, before the interjections were made, I said that I did not accuse him of wrongdoing, and I reiterate that now. If I hurt him - and no doubt I did - I apologize to him. We live in glass houses and therefore we should not throw stones. The debate yesterday was a bit tough, a bit heated and a bit hectic. Irrespective of politics, if I reflected on Senator Wright’s honour, I withdraw unreservedly and apologize for what I said.

page 2195

QUESTION

REPATRIATION

Senator PEARSON:
SOUTH AUSTRALIA

– My question is directed to the Minister for Repatriation. Is there any foundation for the rumour that he is planning a visit to South Australia in the near future? If so, will he visit the Daws Road Repatriation Hospital during the course of that visit? In view of his pending retirement from office, I can assure Sir Walter Cooper that he will be cordially received by the patients and staff generally, and that such a visit would be appreciated by all concerned as a farewell gesture on his part.

Senator Sir WALTER COOPER:

– I propose to be in Adelaide on Monday, 19th

December. I should be only too glad to visit the Daws Road Hospital then. I think I could manage to make the visit in the. afternoon. I shall get in touch with Mr. Panton, the deputy commissioner in Adelaide, and ask him to make arrangements for me to get to the hospital and to visit the various parts of it.

page 2195

QUESTION

IRON ORE

Senator SCOTT:
WESTERN AUSTRALIA

-Now that the Government has decided to lift the ban on the export of iron ore, can the Minister for National Development tell me the estimate of the quantity of iron ore that can be exported from the Mount Goldsworthy deposit, which is approximately 60 miles from Port Hedland, in Western Australia? Is it a fact that recent tenders called by the Western Australian Government for this deposit included proposals to spend about £4,000,000 on port facilities and dredging at Port Hedland? Does this mean that quantities of iron ore outside the resources of the Broken Hill Proprietary Company Limited in outback areas can earn additional export income for Australia and also help to develop our outback areas in the north of Australia?

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

– I hesitate to give any estimate of the quantity of iron ore that can be exported from the Mount Goldsworthy deposit. What has happened at Mount Goldsworthy is, I think, likely to be repeated at other iron ore deposits. A couple of years ago the estimate of iron ore in the deposit was 7,000,000 tons. It was increased to 10,000,000 tons some months ago. The latest information I have is that the estimate is now 25,000,000 tons. In other words, when these deposits are looked at and examined and a little drilling is done, more often than not they prove to be very much greater than the amount that was originally estimated. The policy is to encourage exploration and to find out how much iron ore we have. The only way to encourage exploration is to permit the export of iron ore so that there is an incentive for people to incur the very large expense that is involved in drilling and exploration. What we will do is to treat each proposition on its merits, giving permission to export a quantity to make it worth while for concerns to incur the heavy expenditures and at the same time ensure that we increase our internal reserves.

The development of Mount Goldsworthy will follow a familiar pattern. The geographical situation is such that roads and ports have to be provided, and a good deal of capital expenditure will be incurred in addition to the cost of the actual mining operations. These operations will result in the earning of export income, and will lead to quite a substantial increase in the amount of exploration for minerals as well as to development in our outback areas, because these resources are, by and large, in isolated geographical areas and people will be attracted to them for the exploration and the development of the deposits themselves.

page 2196

QUESTION

BROADCASTING

Senator SHEEHAN:
VICTORIA

– I preface a question to the Minister representing the PostmasterGeneral who. I understand, has some remote control over the Australian Broadcasting Commission, by saying that for many years 1 personally have enjoyed an excellent programme broadcast by the commission known as “ The Village Glee Club “. 1 ask the Minister: Is he aware that for many years the Australian Broadcasting Commission has presented over its stations a very enjoyable weekly session known as “The Village Glee Club Rehearsal “7 I understand that this programme, which has presented to the listening public a number of very talented Australian artists who have been supported by an excellent choral combination known as the A.B.C. Wireless Chorus, is to be eliminated from the commission’s weekly programmes, with a consequent serious effect on the employment opportunities of the combination to which I have referred. Will the Minister request his colleague in another place to use his best endeavours to induce the commission to continue to broadcast this very entertaining item?

Senator SPOONER:
LP

– There is a very old saying, that kissing goes by favour. As we know, some people like certain radio programmes and others do not. In this instance, 1 am glad to say that I subscribe to Senator Sheehan’s view. I have always thought that the programme he has mentioned was quite an attractive one. I had not heard of the proposal to discontinue it. Of course, the decision whether or not it should be continued is, in the nature of things, one that is left to the Australian

Broadcasting Commission, which has the responsibility to decide which programmes are popular and justified and which are not. However, I shall certainly derive a little personal satisfaction from bringing Senator Sheehan’s question before the PostmasterGeneral.

page 2196

QUESTION

CANBERRA TREES

Senator MCCALLUM:
NEW SOUTH WALES

– I direct a question to the Minister representing the Minister for the Interior. My attention has been drawn to an illustrated booklet on trees in the Botanical Gardens at Entebbe, Uganda. I understand that you, Mr. President, have some private knowledge of those gardens, having been to Uganda. Could the Minister arrange for the publication of an inexpensive but informative booklet on the trees of Canberra which could be sold to the residents of Canberra, to members of the Parliament and to visitors to this city?

Senator Sir WALTER COOPER:

– I shall be pleased to bring the honorable senator’s request to the notice of the Minister for the Interior.

page 2196

QUESTION

IRON ORE

Senator BENN:
QUEENSLAND

– My question, which is addressed to the Minister for National Development, relates to the export of iron ore, to which Senator Scott has referred. Has the Government fixed the maximum annual tonnage of iron ore that it will permit to be exported, and will the permits to export iron ore operate indefinitely?

Senator SPOONER:
LP

– The answer is “ No “ to both parts of the honorable senator’s question. The statement I made recently was clear on the point that each application will be treated on its merits and that great care will be taken to ensure that there is not a specific commitment for an indefinite period. By and large, it is contemplated that the maximum quantity exported from the largest deposits will be 1,000,000 tons a year. Of course, only a very large deposit could support the export of a quantity of that order. However, we have been careful to say that we can go over that mark if the circumstances warrant doing so. It must be remembered, of course, that a tremendous amount of capital investment is needed to develop a large deposit. The sum of about £1,000,000 would be required for the mining operations alone. In addition, there must be roads of access, ports and shipping facilities.

In the second part of the question the honorable senator asked whether the approval would operate indefinitely. Again, the answer is “ No “, as was made clear in the statement. This is a new venture into a new policy. We shall always have to carry to conclusion, of course, any commitments that we make. If we agree with someone that he may go ahead with a certain programme, then that programme must always be carried through in order to honour the bargain; but the Government has the right at any stage to make a variation or to discontinue the arrangement if it is not successful.

Senator VINCENT:
WESTERN AUSTRALIA

– My question, which is addressed to the Minister for National Development, also relates to the recent decision of the Commonwealth Government in regard to the exportation of iron ore. Can the Minister inform the Senate whether iron ore is a strategic mineral and as such, pursuant to a policy decision, is not to be exported to Communist countries? If iron ore is not regarded as being a strategic mineral for the purpose I have mentioned, will the Government consider ensuring that no export of it reaches a Communist country either directly or indirectly?

Senator SPOONER:

– I confess that that is a good question. I should not like to answer it without looking at the policy in relation to the export of steel. My recollection is that a limited export of steel is permitted in certain circumstances. I should think that what we would do with iron ore would follow very closely what we do with steel, but I should like to look at the matter carefully before going on record as having stated in specific terms what we would be prepared to do.

page 2197

QUESTION

TEXTILES

Senator O’BYRNE:
TASMANIA

– Is the Leader of the Government in the Senate aware that employees of a textile factory in Hobart which manufactures printed piece goods have been placed on part-time employment for the first time? Also is he aware that since 30th October last 83 persons have been dismissed as being redundant? Further is he aware that the value of imports of printed goods in the last financial year exceeded the value of those of the previous year by £5,330,000? Will he consider having a review of Tariff Board decisions in relation to this industry and take appropriate action when trade agreements are renewed? If this trend is not to be checked - it is a type of economic conscription of labour - what action is the Government taking to rehabilitate in other suitable employment the employees who have been dismissed from the textile industry?

Senator SPOONER:
LP

– I can only say in reply to Senator O’Byrne that this Tasmanian industry has a fairly long history of applications to the Tariff Board and of decisions by the Minister for Trade following recommendations by the board. I would assume that Senator O’Byrne, being a Tasmanian, would be far more familiar with that history than I am. I am sorry I cannot give him a more detailed answer beyond saying that I am sure the Minister for Trade has carefully made arrangements for the Tariff Board to look into the circumstances of this industry, having regard to its importance to Tasmania. I am sure that, subject to that general overriding consideration, the Minister for Trade would be doing what he could to keep the industry in a healthy condition.

page 2197

QUESTION

GENERAL MOTORS-HOLDEN’S LIMITED

Senator LAUGHT:
SOUTH AUSTRALIA

– My question is addressed to the Minister for National Development in that capacity and also in his capacity as Leader of the Government in the Senate. Has the Minister noted that General Motors-Holden’s Limited claims that the sum of £25,000 recently given to the Heart Foundation Appeal signified a gift of £1 for each Australian motor vehicle that that company had exported in playing its part in Australia’s export drive? Has he had occasion to study the extent of the company’s production activities? If he has not, will he check and publicize what I believe to be a fact, namely, that the previously announced expansion of this organization will proceed as planned despite some faint Opposition rumours to the contrary? Will he develop his inquiries and examine the position at Woodville and Elizabeth in South Australia, where splendid expansion programmes have been announced?

Senator SPOONER:
LP

– The possible adverse effects of any new policy are always exaggerated by the opponents of that policy. The information 1 have is that General Motors-Holden’s Limited is continuing its activities at the existing level. Whether it did so was for the company itself to decide, but the company is so big that naturally I made inquiries. I found that to be the position. The only comment I make is that I hope the company will do even more than it is doing now to expand its export trade. I remind the Senate that the company has no mean record already in that direction. I do not want to give a commercial plug to any company, but let me say that this company has exported 25,000 motor vehicles to 36 overseas countries and has already earned over £13,000,000 in export income. I hope that it will carry on with the good work, and if its programme is maintained at the present level, that will be mainly for the purpose of exporting more and more.

page 2198

QUESTION

FLY CONTROL

Senator BROWN:
QUEENSLAND

– I direct to the Leader of the Government a question that is important, although not of world-shattering importance. I preface it by saying that about a week ago I noticed in the “ Sydney Morning Herald “ a report that concern was felt about the prevalence of flies in a number of places, including Canberra. I believe that the Commonwealth Scientific and Industrial Research Organization has on several occasions experimented with methods of eradication.

The PRESIDENT:

– Order! What is the question?

Senator BROWN:

– I am coming to it. I have noticed that others are permitted to preface their questions with remarks, but immediately I make a few prefatory remarks I am called to order. I have noticed that some honorable senators opposite have gone on in this way for almost five minutes.

The PRESIDENT:

– Order!

Senator BROWN:

– My question is: Does the Leader of die Government - -who undoubtedly displays a wonderful know ledge at question time - remember that upon the return from Formosa of a party of politicians, one of them - I think it was Senator Gorton - said in this chamber that there were no flies in Formosa? If so, in view of the importance of the matter in Canberra and other parts of Australia, can he say what method has been adopted by the Formosans to eradicate flies?

Senator SPOONER:
LP

– I suppose that the obvious answer is that there are no flies on Senator Brown. I am sorry that I cannot help, beyond saying that there is a constant endeavour to reduce the number of flies in Canberra and elsewhere. I am certain that the Commonwealth Scientific and Industrial Research Organization has made inquiries about the methods of eradication used in other countries.

page 2198

QUESTION

IRON ORE

Senator O’FLAHERTY:
SOUTH AUSTRALIA

– I ask the

Minister for National Development whether the Broken Hill Proprietary Company Limited and the South Australian Mines Department have been experimenting with the refractory ores jaspilite and limonite. Has any arrangement been made by private enterprise or State governments for the Bureau of Mineral Resources to experiment with low-grade refractory ores containing iron in order to ascertain whether greater industrial use may be made of such ores?

Senator SPOONER:
LP

– Although I am not in a position to give detailed information about the nature of the work that is being done in this connexion, I do know that many experiments are under way and that they have a very good chance of success. If I recollect correctly, the Broken Hill Proprietary Company Limited has built a pilot plant to put into practice the theoretical experiments that have been conducted up to date. I am aware that other experiments are going on elsewhere in Australia. I am hesitant to try to translate the professional opinions that have been given to me, but I understand that the work being undertaken shows such great promise of success that the present picture of our iron >ore reserves seems likely to be transformed. If the work is successful, large deposits of ores previously regarded as of too low a grade for practical use will, as the result of beneficiation, become available to the steel industry on a competitive basis with other ores. I am further informed that when this happens in Australia the pattern of development will follow that in other countries which do not possess rich deposits of ore but beneficiate their low-grade ores and use them. We have not yet had to do that.

page 2199

QUESTION

DAYLIGHT SAVING

Senator VINCENT:

– I apologize to the Leader of the Government for calling upon him to answer yet another question. My question relates to official time in this country and the practice known as daylight saving. Has the Government recently considered the advantages that can accrue to the Commonwealth, particularly the southern States, in savings of power and electricity, by the introduction of daylight saving, which is the alteration of official time in order to provide more hours of daylight during normal working periods? If the advantages are real, will the Government give consideration to making this desirable alteration, which is now common practice throughout most of the world and. which would provide such enlightened cities as Melbourne with more working hours of daylight?

Senator SPOONER:
LP

– All I can say is that I have no knowledge of any recent inquiry by the Government into this matter.

page 2199

QUESTION

HOUSING

Senator TANGNEY:
WESTERN AUSTRALIA

– I direct a question to the Minister representing the Treasurer. As the result of the recently introduced financial restrictions, will home owners, who are in the process of buying their homes with loans from the Commonwealth Bank, be required to pay higher interest rates notwithstanding the terms under which the loans were originally negotiated?

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

– A question similar to this question was asked in the House of Representatives this morning. I can only give the honorable senator the answer which the Treasurer gave to the. honorable member who asked him the question: He will have a look at the matter and make a statement on it.

page 2199

QUESTION

CANBERRA

Senator TANGNEY:

– My question is addressed to the Minister representing the Minister in charge of the Commonwealth Scientific and Industrial Research Organization. It is along the same lines as Senator Brown’s question, except that the subject-matter is on a slightly larger scale. Has the Minister seen recent newspaper reports that snakes are prevalent in Canberra at this time of the year and that householders should take care? Does the C.S.I.R.O. know that there are no snakes in Ireland? Can it carry out investigations to see why that is so, and apply to Canberra the processes which apply in Ireland?

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

– I understand that there are snakes in Canberra. We have more evidence of them at some times than at other times. I cannot answer for Ireland. If it is snake-free, it has my blessing.

page 2199

QUESTION

IMMIGRATION

Senator BUTTFIELD:
SOUTH AUSTRALIA

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

  1. Can the Minister give the Senate any information regarding the working, to date, of the Operation Reunion scheme, under which relatives of Australian citizens or migrants living behind the iron curtain are permitted to be reunited with their families in Australia?
  2. Has the situation eased at all during the last eighteen months or so and has the Soviet Government shown any leniency towards these people?
Senator HENTY:
LP

– The Minister for Immigration has supplied the following answers: - 1.. The Operation Reunion scheme, initiated in 1956, was based on an appeal, on humanitarian grounds, to the Communist countries of eastern Europe to grant exit visas to their nationals who wish to be reunited with their relatives in Australia. The results achieved have varied at different times from country to country, and also at different times in the same country. It will be. readily appreciated that the granting of an exit visa depends ultimately on the goodwill of the country concerned. However, it is gratifying to me to be able to say. that over the past four and a half years more than 10,000 people have come to Australia from these countries to join their relations, including fiances. Another 14,000 are hoping to come here.

  1. Within the last eighteen months the Soviet Government has granted permission to 168 people to come to their families out here - seven times as many as in the previous three years. Thus the statement that this was “ only a beginning “, made in May, 1959, when it announced that it had decided to allow 21 people to go to Australia, is being substantiated; and I fervently hope that, as the months go by, a much greater number of parents, wives, husbands and children from the Union of Soviet Socialist Republics will realize the ambition they have cherished for so long of being able to join their families again after years of separation.

page 2200

QUESTION

RAIN-MAKING

Senator PEARSON:

asked the Minister for National Development, upon notice -

  1. Does the submission to an independent overseas expert for assessment of the results of the recently completed five-year experiment in rainmaking, conducted by the Commonwealth Scientific and Industrial Research Organization and referred to by Sir William Hudson, indicate that the Snowy Mountains Hydro-electric Authority now considers that these experiments are worth continuing?
  2. If so, will similar experiments be carried out in other parts of Australia?
Senator SPOONER:
LP

– I give these answers -

  1. The Snowy Mountains Hydro-electric Authority considers the results of the cloud seeding experiments in the Snowy Mountains area during the past five years to be sufficiently promising to warrant further work being carried out. The authority is of the opinion that this additional work must be undertaken before unqualified support can be given to the apparent results achieved to date.

  2. The Commonwealth Scientific and Industrial Research Organization is at present carrying out three other experiments similar in general principle to that which has been conducted in the Snowy Mountains area during the past five years. These are -

    1. over the New England area in New South Wales;
    2. over the Darling Downs in Queensland;
    3. over the catchment area of the Warragamba Dam in New South Wales.

page 2200

QUESTION

COMMONWEALTH EMPLOYEE’’ COMPENSATION ACT

Senator McMANUS:
VICTORIA

asked the Minister representing the Treasurer, upon notice -

  1. Has the Government received representations from organizations and unions representing Commonwealth employees seeking improvements in the Commonwealth Employees’ Compensation Act?
  2. Does the Commonwealth act compare most unfavourably with State acts of this type?
  3. Does the operation of the present act involve undesirable delays?
Senator PALTRIDGE:
LP

– The Treasurer has supplied the following answer: -

  1. Amendments to the Commonwealth Employees’ Compensation Act have been sought by organizations and unions representing Common wealth employees. In his acknowledgements of these representations, the Treasurer said that he would consider the requests in the light of the most recent High Court judgments. He asked that the arguments which would justify additional liability being imposed upon the Commonwealth be elaborated in written form. The last communication the Treasurer has received on the subject, on 8th August, 1960, from the Australian Council of Trade Unions said that “ officers will give consideration to the points you have raised and the request for elaboration in written form of the arguments in support of the organizations’ request.” A review of the High Court judgments has now been sought in the Privy Council.
  2. It is not possible to make a generalized reply to this question. It would be necessary to compare each part of the Commonwealth act with each part of every State act since there are differences between the State acts. For example, the maximum amount payable to a widow under the Commonwealth act is £3,000; under the Tasmanian act it is £4,000 and under the South Australian act £2,750. Even this example would be subject to the further qualification that, in Tasmania, there is no general liability of the kind provided under the Commonwealth act in relation to journeys to and from the employment.
  3. Claims for compensation are dealt with as quickly as possible. Most cases are finalized without delay, but more time is required for the investigation of the more difficult cases. A delay in the finalization of claims built up during 1959 because of the shortage of staff in relation to the rapid growth of work. These arrears have now been overtaken as a result of special measures taken to divert staff from other work.

page 2200

QUESTION

MEAT

Senator McMANUS:

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

Will the Minister consider and comment on the report of the Victorian Inland Meat Authority just issued and particularly on those aspects of the report which appear to differ strongly from opinions recently expressed by Commonwealth primary production authorities that there is no need for alarm regarding allegations of a decline in meat production?

Senator HENTY:
LP

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

It is suggested that the report of the Victorian Inland Meat Authority refers specifically to prospects in that area of Victoria in which it operates. It would therefore be impractical to compare some of the opinions expressed in that authority’s 1959-60 annual report with those of Commonwealth primary production authorities.

There was a reduction in cattle numbers in 1958-59 which was mainly attributable to losses through drought and the heavy demand for lean cattle for the United States market. However, although beef exports to the United States in 1959-60 continued at a high level, figures issued by the Commonwealth Statistician show that beef cattle numbers increased in the twelve months ended 31st March, 1960, by 222,000 head. One of the principal benefits of the American market is the wonderful opportunity it has provided producers judiciously to cull their herds and introduce better class bulls. In addition, the substantial investment which has occurred in recent years in Northern Queensland has contributed materially to a marked improvement in the quality of cattle both carried and marketed.

Commonwealth beef production for the three months ended September, 1960, was 60,000 below the figure for the corresponding period last year while beef exports for the same period were down 19,800 tons compared with last year. Given favorable seasonal conditions there could be substantial numbers of killable cattle available for export in 1961, but in view of the dry conditions that have obtained in much of Queensland the cattle may not commence to come forward during the early months of 1961.

With increasing sheep numbers, mutton production has shown a slight increase during the July-September period and total exports have also increased. In a similar manner, lamb production and exports also increased during the July-September quarter when compared with the same period last year.

The report of the authority indicates that there has been a virtual cessation in the export of manufacturing type beef and mutton to the U.S.A. However, the Commonwealth Statistician’s figures show that during the first four months of the current 1960-61 season 24,400 tons of beef and veal valued at £8,190,000 and 3,230 tons of mutton valued at £740,000 were exported from the Commonwealth to the U.S.A. Mutton exports to Japan for the four months period totalled 750 tons valued at £120,000 compared with nil in the same period last year and lamb exports to the U.S.A. and Canada for the four months amounted to 654 tons valued at £180,000 and 1091 tons valued at £250,000 respectively compared with 265 tons valued at £80,000 and 898 tons valued at £180,000 for the same period in 1959.

It may be seen therefore that the Commonwealth is still exporting considerable quantities of beef, mutton and lamb to the U.S.A. and exports of mutton to Japan have increased from nil to 750 tons. It would appear that the latter market has considerable potential for further expansion.

page 2201

QUESTION

CANBERRA TO QUEANBEYAN RAILWAY

Senator McMANUS:

asked the Minister representing the Minister for Shipping and Transport, upon notice -

  1. Is a proposal under consideration for transfer of ownership of the railway line between Canberra and Queanbeyan from the Commonwealth to the New South Wales Railways Department?
  2. Would such a proposal ensure a better rail service for Canberra?
  3. Is it a fact that Canberra will be deprived this Christmas of the diesel air-conditioned train normally linking it with Sydney and that its travellers will be provided with an old-type steam train for the Christmas holiday period? If so, is this in keeping with Canberra’s status as federal capital?
Senator PALTRIDGE:
LP

– The Minister for Shipping and Transport has provided the following answers: -

  1. The Commonwealth Railways Commissioner has had discussions with the New South Wales Railways Commissioner regarding the transfer of ownership of the Canberra-Queanbeyan railway line but a definite proposal has not yet been submitted for the consideration of the Commonwealth Government.
  2. The rail service provided would be a matter for the New South Wales Government Railways and presumably, as at present, would be related to the demand.
  3. The New South Wales railway authorities advise that owing to heavy holiday traffic on Thursday, 22nd December, Friday, 23rd, Tuesday, 27th, Saturday, 31st, and Monday, 2nd January, 1961, and Saturday, 7th January, the full eight-car airconditioned train set, which normally divides at Queanbeyan with four cars proceeding to Cooma and four to Canberra, will run to Cooma for the convenience of the long-distance passengers. On those dates the Sydney-Canberra service will be provided by a six-car non-air-conditioned steel set hauled by a diesel electric locomotive. Train services on the Canberra-Queanbeyan railway are provided by the New South Wales Railways with their locomotives and rolling-stock. In determining the services to be provided at holiday periods that department. like all other railway systems, is obliged to make the best possible use of available resources.

page 2201

QUESTION

COMMEMORATIVE POSTAGE STAMPS

Senator SPOONER:
LP

– On 29th November Senator Hannan asked me the following question: -

I address a question to the Minister representing the Postmaster-General. Has his attention been directed to the current United States Post Office stamp commemorating the Polish hero Paderewski? Does not the Minister believe that the issue of commemorative stamps featuring in turn the national heroes of countries to the people of whom Australia has offered refuge from communism, would be a gracious act which would improve the morale and spirit of those people who have settled here and also would be a reminder of Australia’s unceasing opposition to Communist dictation and aggression? Is the Minister further aware that the free Ukrainian movement has petitioned the United Nations to declare 1961 the year of Taras Schevchenko, the great Ukrainian poet and champion of freedom who died in 1861? If the idea commends itself to the Government, will the Minister consider the suggestion that a start should be made with Taras Shevchenko, the heroes of other countries being honoured as suitable annniversaries present themselves over a period of years?

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

The Postmaster-General’s Department does not contemplate issuing a stamp series commemorating the national heroes of various countries, such as the current “ Champion of -Liberty “ series being produced by the United States Post Office. In any event the number of other projects on hand makes it impracticable to add further to the stamp programme for 1961.

The overall policy of the Australian Post Office with regard to stamp issues is to endeavour to reflect various aspects of Australian life and development. The present policy on commemorative stamps is that they shall be limited in number and be issued only on occasions of outstanding national importance or of special historical significance.

The Postmaster-General has indicated that a series depicting national heroes of various countries hardly comes within the ambit of this policy.

page 2202

QUESTION

COMMONWEALTH OFFICES, ADELAIDE

In view of the fact that at the present time the Commonwealth Government rents premises for its departments in at least 21 different buildings in Adelaide, and in view of the fact Chat several large office buildings either are under construction or are to be constructed in the near future in that city, does not the Minister consider it advisable in the interests of efficiency and the convenience of the general public to review the whole departmental set-up in Adelaide and to endeavour to group the Commonwealth’s main offices in the space available in one of these large modern buildings?

The Minister for the Interior has now supplied me with the following information: -

The Department of the Interior acts only as agent in the acquisition of premises when a department indicates some requirement for new office accommodation.

Some departments in Adelaide have, within comparatively recent years, been housed in new and modern accommodation and as requirements arise so additional accommodation in new office buildings will be obtained. It should, however, be remembered that the rents for such premises are paid by the ‘departments who use them and the great increase in rentals between the older type accommodation and new modern offices .is so great that it could well cause the department .concerned to hesitate before committing itself to greatly increased expense.

In .course of time it is .likely that the Government will build its ;own .office accommodation in whole or in part in Adelaide, but its present large capital commitments in other cities do not make it possible at the present time to find the resources to do this.

page 2202

ADVANCE TO THE TREASURER. 1959-60

Statement of Expenditure

Senator PALTRIDGE:
LP

– I lay on the table of the Senate the following paper: -

Advance to the Treasurer - Statement for the year 1959-60 of Heads of Expenditure and the amounts charged thereto pursuant to section 36a of the Audit Act 1901-1960.

Ordered -

That the statement be .considered in Committee of the Whole.

page 2202

GOVERNMENT BUSINESS

Precedence

Motion (by Senator Spooner) agreed to -

That Government business take precedence of general business after 8 P.m. this sitting.

page 2202

LOAN (QANTAS EMPIRE AIRWAYS LIMITED) BILL 1960

Second Reading

Debate resumed from 7.th December (vide page 2138), on motion by Senator Paltridge-

That the bill be now read a second time.

Senator KENNELLY:
Victoria

– The purpose of this bill is to give parliamentary approval to the borrowing by the Commonwealth of 30,000,000 dollars, equivalent to £13,300,000 in Australian money from the Export-Import Bank of Washington on behalf of Qantas Empire Airways Limited. This loan will enable Qantas to buy three new Boeing 707-138B aircraft and spare parts for them, and also to convert the existing Qantas fleet of seven Boeing 707-1 3 8’s into 707-1 3 8B aircraft. As the Minister for Civil Aviation (Senator Paltridge) said in his second-reading speech, this will give the planes an increase in cruising speed of 40 miles an hour and, what is very dear to my heart, it will cut fuel consumption by 10 per cent, and increase the pay-load. It will also increase the take-off thrust from 13.500 lb. to 17,000 lb.

We are all very proud of Qantas, which is equal to if not better than any other international airline. It is a credit to this country. Qantas will accept the full responsibility of seeing to it that the Commonwealth will not be out of pocket in this matter. I do not intend to go into the details of the intricate borrowing agreement. The Opposition supports the bill.

Question resolved in the affirmative.

Bill read a second time.

In committee:

The bill.

The Schedule.

AGREEMENT

This Agreement made and entered into this dayof , 19 , by and between the Commonwealth of Australia (hereinafter called “ Commonwealth “), Boeing Airplane Company, Seattle, Washington (hereinafter called “ Boeing “) and Export-Import Bank of Washington (hereinafter called “ Eximbank “), an agency of the United States of America.

WITNESSETH:

Whereas, in addition to the predelivery payments of Four Million Two Hundred Six Thousand Six Hundred Thirty-Five Dollars and Twenty Cents ($4,206,635.20) to be made with respect to the Boeing model 707-138B aircraft and not to be financed hereunder, Qantas has agreed to make other cash payments with respect to the contract price of the program; and

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

. -I move -

In the tenth paragraph of the preamble, after “with respect to the”, first appearing, insert “ ‘ retrofit kits ‘ and the three (3) additional “.

The acceptance of this amendment is necessary for the reason that there was last week an undetectable and freak fault in a cable transmission and the six words proposed to be added were not received in Canberra although they were relayed from Washington. The omission was not discovered until yesterday, by which timethe bill had been passed by another place. The addition of these words merely makes clear the fact that the amount of 4,206,635 dollars referred to in the preamble is the same as the pre-delivery payment to which the preamble makes reference. This wording of the preamble has been drafted by the Export-Import Bank.

Senator KENNELLY:
Victoria

– I shall not detain the committee for more than a moment or two. In his secondreading speech, the Minister said that the letters of credit will be issued by a commercial bank. I take it that they will be issued by a bank other than the Commonwealth Bank?

Senator Paltridge:

– Yes, by an American bank.

Amendment agreed to.

Bill, as amended, agreed to.

Bill reported with an amendment; report adopted.

Bill read a third time.

page 2203

LOAN (AUSTRALIAN NATIONAL AIRLINES COMMISSION) BILL 1960

Second Reading

Debate resumed from 7th December (vide page 2139), on motion by Senator Paltridge -

That the bill be now read a second time.

Senator KENNELLY:
Victoria

– This bill is similar to the Loan (Qantas Empire Airways Limited) Bill 1960 that the Senate has just passed, insofar as it seeks parliamentary approval for the borrowing by the Commonwealth in the United States of America of 2,000,000 dollars, which is equivalent to £890,000 in Australian money. The agreement provides that the loan will be repaid by the Australian National Airlines Commission which operates TransAustralia Airlines. In this instance, the loan has been negotiated with the Chase Manhattan Bank of New York. The money is to be used to purchase a third Electra aircraft. The Minister’s second-reading speech does not tell us the cost of such an aircraft, and I should be interested to have that information.

I regret that this bill has been brought before the Senate at such a late stage of our sittings, Mr. Deputy President. As you know, we have had some late nights which have knocked us about. I am sorry that the bill was not introduced in the Senate a little earlier, because there are several interesting questions that could be raised. I think, for instance, ofthe question why the Government forced T.A.A. to purchase Electra aircraft instead of Caravelles, and also why it does not permit that airline to trade intra-State. However, the festive season is approaching and we shall not raise those questions now, but there is an important point that I want to make. The Electra aircraft are to go back to America for modification of the wing structure, as I understand it. I appreciate that it is quite safe to operate them as they are, so long as they do not exceed a certain speed. This modification will not cost T.A.A. anything, but I am wondering what arrangements will be made if, at some future time, a further minor adjustment should be necessary. May I say that I think that the Electra is a wonderful aircraft from the point of view of the comfort of passengers. In raising this point, I do not want to take advantage of the debate to play one of our major airlines off against the other, because they both operate Electras and they both have good pilots, and so on. I merely say that I am disappointed that the bill did not come to the Senate earlier, because I am sure that we could have had an interesting discussion.

I hope that when the modifications have been effected and the aircraft are cleared, there will be no need for them to go back for further modification, but should that be necessary, I should like to know whether the cost will be met by the company, as it appears to be in this instance.

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

– in reply - Senator Kennelly has asked about the cost of Electra aircraft. I inform him that the cost is £1,130,000. The loan which the bill proposes to seek will be £890,000, and the balance of the cost of the aircraft will be found from the resources of Trans-Australia Airlines. Regarding the suggestion that Caravelles should have been purchased instead of Electras, I appreciate the point made by the honorable senator that the festive season is approaching, and for that reason I also do not propose to pursue the matter at this time. We have discussed it in the past and I have no doubt that we shall do so in the future.

The honorable senator also asked what would happen if it became necessary for the aircraft to be sent back for further modification. I inform him that the modification that is to be made, and also other modifications that may be necessary, are covered largely by warranty provisions that are accepted when aircraft are purchased. I should not like to mislead the honorable senator in any way. The warranty conditions that are applicable to aircraft of any type are not those to which we are accustomed when we purchase a motor car, for instance. Because of the nature of the aviation industry, the warranty provisions are not as tight as I should like to see them, and they certainly are not as tight as those which one would require when purchasing a motor car or other equipment. However, I assure the honorable senator that the waranty conditions applicable to Electra aircraft are in conformity with those that apply to the sale of all aircraft and are as tight as it is possible to get them in the circumstances.

Question resolved in the affirmative.

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

page 2204

PUBLIC SERVICE BILL 1960

Second Reading

Debate resumed from 7th December (vide page 2132), on motion by Senator Spooner -

That the bill be now read a second time.

Senator WILLESEE:
Western Australia

– The bill before the Senate is one which, at first glance, might be thought to be of no great significance and to warrant no more than a second-reading speech by the Minister and a vote of the Senate. However, the Opposition has examined the bill closely and has given long and earnest consideration to it. It has been the subject of much debate and several meetings. We have found that it is not all that it seems to be on the surface. Some major changes of policy are proposed.

The first matter that I want to deal with, Mr. Deputy President, will not be the subject of an Opposition amendment, although we shall be seeking to amend other clauses of the bill. I shall refer to those amendments in a few moments. The first, and perhaps the most important, change of a policy that is proposed is not embodied in the bill, but is merely referred to in the second-reading speech of the Minister for National Development (Senator Spooner). It relates to the movement of officers from the Fourth Division, or the general division, to the Third Division. It is unfortunate that this proposal is not embodied in the bill because I think that the opinion of the Senate should be tested on it. I make no criticism beyond saying that, because 1 realize that it has been the practice to leave the administration of such matters to the Public Service Board and to give the board scope for flexibility in relation to the Public Service recruitment and promotion systems. This bill will do nothing to disturb those systems.

As honorable senators are aware, the two main divisions of the Public Service are the Fourth Division and the Third Division. There are also a First and a Second Division, in which are to be found officers in the upper echelons of the Public Service but, as Senator Spooner has pointed out in his second-reading speech, the Fourth Division comprises 66,000 public servants of the Commonwealth. The board may appoint persons to that division, either without examination or upon such examination as it thinks proper. That is as it should be. The division covers public servants in the lower grades, such as lift drivers, cleaners and labourers, as well as highly skilled people, such as technicians, security officers and so on. The division covers a wide field of employment, but those within it are not concerned with policy making and the higher administrative tasks. In general, the policy of recruitment to that division is not altered by the amendments proposed1 in the bill, and we offer no criticism of that aspect of the matter.

Then we come to the Third Division, which covers a wide range of people from those doing clerical jobs right up to high administrative and policy-making officers. Over the years and up to the present time a person applying for appointment to the service - for example, a boy leaving secondary school - has had his results in the leaving certificate examination, or its equivalent in the various States, taken into account. If he has been sufficiently far up the scale, he has been appointed to the Third Division in that year. In addition, the board has also accepted for appointment to the Third Division university graduates, with a limit for any one year of 10 per cent, of the total intake. Highly technical or specialized jobs have been excluded.

Furthermore, under existing section 47, the Governor-General has power to make appointments, without examination, to sections of the Public Service in which very special skills or qualifications are needed. Such appointments are hedged around with safeguards with which I quite agree. For example, the Public Service Board1 must certify to the Governor-General that there is no one within the Public Service who is capable of performing the duties in question. The relevant papers must be laid on the table of both Houses of the Parliament with a view to seeing that nepotism or that kind of thing does not take place. 1 query the alteration to this aspect of the legislation which is proposed in the bill, and I trust that the Minister for National Development will offer a satisfactory explanation of it when he replies. I note that it is intended not to make the provision specific, but to make it apply to the general division. I assume that means the unattached positions. There may be a very good reason for doing this. I merely indicate that I should’ like to hear it.

The fourth method by which the Public Service Board may recruit people to the Third Division is to appoint persons from within the service upon their passing an internal examination. Although there is no such provision in the bill, both the Prime Minister (Mr. Menzies) and the Minister for National Development have made it abundantly clear in their secondreading speeches that the board will insist upon such officers passing the equivalent of the leaving certificate examination. Up to the present time, the Public Service Board has recognized that officers who have sat for the internal examination have rendered years of loyal and1 faithful service. I know of officers who have devoted themselves to their work in perhaps a technical position, in the postal service or perhaps in a supervisory capacity. Up to the present, when such persons, in pursuit of their ambition to rise to the higher echelons, have sat for the requisite examination, the board has always recognized the fact that they have had vast experience on the lower rungs of the ladder in various departments. When all is said and done, experience cannot be gained by sitting for an examination; it can be obtained only over a period of time. In view of that fact, the board has modified the examination and has set it at what I would describe as being a subleaving standard. In other words, when a person enters the Third Division by this means he has complied with a standard which is a rough approximation of the standard of the leaving certificate examination. In other words, he is knowledgable in the particular subjects covered by the examination and has had long and faithful service in the Public Service.

In future the policy of the Government, as clearly laid down by the Prime Minister and the Minister for National Development in their second-reading speeches, will be to insist that people entering the Third Division by the means I have just indicated, will have to pass the equivalent of the leaving certificate examination. In my opinion, that is a retrograde step. First, no marks will be given for the valuable experience that has been gained by the officer concerned. I pause just now to pose this question: What is the most valuable qualification that a person can have when he is moving into a higher administrative position in which policy decisions have to be made? From now on, does the board intend to say that it would rather have a man who has passed the leaving certificate examination and who could be a rubber stamp? Or will it prefer a man who has rubbed shoulders with others in several departments and who has served in an administrative or supervisory capacity? I am inclined to say that experience is the more valuable qualification to have. That is the point I want to emphasize. I hope that when this becomes a matter of administration, the Government will have another look at its proposal.

Let us look at the human side of the problem. The Public Service Board is encouraging juniors of the age of fourteen years to join the Public Service. It sets before those lads the wide field of opportunity which exists in the Public Service. It has always been thought - in fact, it has been said - that the same opportunities for promotion exist in the Public Service as exist in the Army where it is said that every private carries in his knapsack a potential field-marshal’s baton. And over the years that has been proved to be so in the Public Service. Quite often we hear of a person retiring from tr-<? Public Service who has commenced duty as a telegraph messenger or in some such capacity in a remote hamlet or glen. But the Government is now moving away from that approach and, having encouraged a young lad in some remote hamlet or glen to join the Public Service at the conclusion of his primary education, it suddenly requires him to compete with boys who are entering the service at the conclusion of their secondary education. If it were necessary to have this higher qualification, I would agree with it. But there are so many positions within the Public Service that it is unnecessary for the board and the departments to require people who are seeking promotion to measure up to the standard of the leaving certificate examination.

The Minister has pointed out that this proposal is based upon the recommendation of the Boyer committee. I point out that it goes beyond the recommendation of that committee. The Boyer committee recommended that a special Public Service test should be adopted. Prime facie, that would seem to be a very good idea. It would be a further test of the suitability of an officer for the type of work he would be required to perform and would cover such matters as a general knowledge of the political set-up and relationships between the Public Service Board and the departments. As I have indicated, I believe such a test would be very good. However, I make a special point of the fact that the committee recommended that the standard of this Public Service test should approximate that of the leaving certificate examination. We could bandy about definitions of the word “ approximate “, but surely if the committee intended to insist, as the Prime Minister and the Minister for National Development have assumed it intended to insist, that the standard should be that of the leaving certificate examination, it would have recommended that that standard be applied and would not have used the word “ approximate “. For those reasons, the Opposition opposes the provision.

If the board said that in any year it would take the best applicants that it could get, that would be. a horse of a vastly different colour. We have discussed this matter in the party room and we support a raising of standards in the Public Service, but that will not be achieved by this bill. If the policy were, “We will take the best that can be obtained, and devil take the hindmost; it is not our job to worry about helping people “, the board would take all the university graduates it could get. But that is not being done. The provision limiting the intake of university graduates to- 10 per cent, of the total intake in any one year is being preserved. To the boy with a leaving certificate, the board says, “ We will take you into the Third Division. We will protect you from fierce competition by limiting to 10 per cent, of the intake the number of appointees with a better education.” He is, so to speak, a protected person. However, to the boy who has not had the advantage of a secondary education, the board says, “ We will not give you any special protection “. Despite the knowledge that he has picked up in a department or several departments, he has to compete with the other boy on an equal basis, so far as scholastic attainments are concerned, in that one year. I suggest that as the boy with a leaving certificate is protected against people with university degrees, the protection should be extended further to help the boy who has not a leaving certificate, but who may have given long and faithful service and have acquired considerable experience in a department or in a number of departments. Credit should be given for that.

Senator Spooner:

– If he is a good lad, he will sit for his leaving certificate, will he not?

Senator WILLESEE:

– You are dealing with a person already in the Public Service. It is all very well to say that, but I have made a two-pronged approach. I do not want to play on the Minister’s emotions, because he is not the type of fellow for that approach.

Senator Spooner:

– You do not know me.

Senator WILLESEE:

– Perhaps I know Caesar too well. There is the human element, but there is also the departmental angle. Why throw away this experience? Why make it tougher for this person? It is not merely a question of sitting for the leaving certificate examination. Certain people have the faculty of judging what an examiner will ask. I do not say that derogatorily. The Minister is an experienced accountant, and he knows that it is handy to be able to do that in preparing for accountancy examinations.

This fellow will not be going scot-free. He may have passed four or five technical examinations. Consider the case of a technicianone of the most highly trained men in the Public Service. He does a five-year course to qualify as a technician. Under his own steam, he may do another course, occupying two or three years, to become a supervising technician. As such, he handles important jobs in the installation of technical equipment. In the course of that employment he might be bossing twenty or 30 men. He frequently has to act as an engineer in the planning of engineering projects. If he were allowed to sit for a modified leaving certificate examination of a somewhat lower standard, surely he would be able to demonstrate that his intelligence was up to the standard required for higher administrative positions. At this stage he is not a lad. He is in the prime of life. After twenty years’ experience, he is only about 34 years of age. If he can demonstrate that he is not completely dumb on such subjects as economics, foreign languages and English - which is always a compulsory subject - and if he can show that he is sufficiently intelligent as to be able to engage in top-level discussions later in his career, that is all that is required.

I leave the matter there. There could easily be some confusion on this point. After all, when you read a report as com.prenhensive as that of the Boyer committee, you can easily come to one conclusion and, upon examining the report more carefully, find that you were led up the garden path. We have all had that experience.

It is commendable that the board has made these recommendations and that the Government is trying to raise the standard of the Public Service. I say merely that a very real problem is being overlooked. I know that we are moving into an era when the tendency is not even to look at somebody who has not a degree. To a point, that is very good. However, there are jobs for which any number of degrees will not fit a person. We find that only particular types of people can handle particular jobs. A field that comes readily to mind is that of arbitration. Certain types of people appear to be peculiarly suited for work in that field1. The value of degrees can be over-estimated. Because of the increasing number of young people now coming on the employment market as a result of the increase in the birth-rate after World War II. employers’ organizations such as the Public Service Board - the board is an employers’ organization - will be able to pick and choose to a greater extent than in the past. I agree with that. I do not say that we should down-grade the Public Service - far from it. In countries where the public service has failed, governments have failed, because governments cannot function without sound public services. This matter should be very carefully examined before the administrative machinery goes into action.

There are other provisions in relation to which we shall be moving amendments. I shall not deal with the amendments in detail now, but I shall outline them in order to give the Minister an opportunity to give them a few minutes’ consideration. He could very well accept the amendments which we propose in good faith. For many years the Public Service Board has laid down, for admission to the Public Service, minimum requirements as to age, health, nationality, loyalty and1 that type of thing. It is the normal right of an employer to decide whether or not an applicant is a fit and proper person. If he had a long criminal record, he would not be put in charge of the exchequer or in a job where he would be handling money - in fact, he would not be employed in the Public Service in any capacity. To put the position beyond any doubt, the board’s powers in this regard are written into the legislation. That is a good1 thing. However, the Opposition intends to move an amendment to safeguard the rights of applicants. First, a mistake may be made. There may be 300 or 400 applicants in a group. A check is made with the criminal investigation branch and information received is accepted as applying to a particular applicant, but it may be a case of mistaken identity. I have seen this happen in the Public Service, with some embarrassment to myself on one occasion. There is a possibility of mistake. An applicant ought to be able to protect himself against that possibility. If he is told merely that he is not accepted, he has no way of knowing why he is not accepted and has no chance of appealing.

He is bewildered and thinks he is not a suitable person. The other aspect is the weight that is given to certain information. A man might be excluded because of something that happened twenty years ago - something that is regarded as serious by one person but not by another. An applicant may merely have been involved in a brawl or something of that nature many years previously. On the one hand it may be said that such a person has a violent nature and should not be placed in charge of people. On the other hand his action may be regarded1 as youthful indiscretion, probably committed under provocation. In the committee stage I will have more to say on that matter.

The Boyer committee and the Minister referred to physically disabled persons. The Opposition thinks that more employment opportunities should be made available in the Public Service to such persons. The Public Service is better suited than private industry to employ these people. It has a greater variety of positions to offer them. It should do more to absorb these unfortunate people into the work force of the community. Many of these people have been injured in the defence of this country; others have been injured as a result of accidents, and consequently they cannot compete for positions with the general run of employees.

Equal pay for the sexes is a principle in which the Labour Party firmly believes. The Commonwealth subscribes to international charters that embody this principle, and it should give equal pay to women if they do the same work as men. Women are being paid the same amounts as men in many industries to-day and we feel that the practice should be extended to the Public Service. After all, the Government should set the example for the community to follow.

With regard to the position of temporary employees, the Public Service Board has done a lot in recent years to absorb these people in the various departments on a permanent basis. There has been a marked improvement in this matter since the end of the Second World War, but we feel that more could be done towards granting permanency of employment to persons who have given many years of service to the various departments. In the committee stage we will move an amendment along the lines I have indicated.

Although the Public Service Board is to upgrade employees in the Third Division in accordance with the Boyer committee’s report, it does not propose to carry out the further recommendation of the committee - to increase the base rate salary from £968 to £1,083 per annum. If higher qualifications are to be insisted upon, the base salary should be increased as recommended by the committee. The Opposition will deal with this matter further in the committee stage.

I have outlined the Opposition’s attitude to this bill. The Prime Minister in another place said, in effect, that he agreed in principle with the improvements that the Opposition is seeking. When these matters are raised in the committee stage the Government might well accept some of our suggestions, with benefit to all concerned.

Senator McCALLUM:
New South Wales

– I support the bill. I think it is a comprehensive bill and a very good one. However, I will defer a detailed discussion of the bill to the committee stage.

The alterations proposed to the act by this bill are very good ones. Public service boards were instituted in the various States mainly in order to prevent political patronage and favoritism. They were instituted in order to secure efficiency in the services. In the main they worked very well. The State public services became very efficient bodies, but certain defects grew up. I am well aware of those that developed in the service in New South Wales. There was too great a tendency to rely on regulations; there was an inability to use one’s personal judgment even when it should be used; and promotion tended to be almost entirely determined by seniority. Promotion by seniority has great merit in that it makes for happiness and contentment within the lower grades of the service. If tests are applied at various stages, promotion by seniority may be very good. The old idea of the office boy always having the opportunity to become the manager was good. Its application has worked well in some private enterprise and reasonably well in the State services. But, very wisely, the Commonwealth (Public Service Board has abandoned that principle in order to give encouragement to graduates.

I applaud its attitude in allowing graduates to enter the service at higher levels of educational attainment. The work of the Public Service is so complicated to-day that it must have experts of all kinds. Its higher officials must be men with attainments at least equal to those of university trained men. For employment in any division where the work is other than routine the minimum qualification required should be the leaving certificate. Senator Willesee said that tests may be devised within a department which would in some way differ from the standard of the leaving certificate, but I think that the Service should endeavour to procure employees of at least leaving certificate standard. I regret that the leaving certificate is not a very high standard. Before I entered the Parliament I was teaching at a teachers’ college. The minimum standard required there for trainees was the leaving certificate, but I am afraid that many of the students got through their leaving certificate examinations very easily and the teachers had to fill in the gaps in their education, or at least to try to do so. I think the system worked fairly well in the circumstances.

This bill is designed to get rid of some of the rigidity which is almost inevitable in a public service. The old-fashioned public servant in New South Wales was an extremely rigid man. I remember a very good friend of mine, a most efficient man, who had to look after various things that I did when I was an examiner. On one occasion I wrote a report, but my friend did not like several of the phrases that I had used in it. He asked me whether 1 would mind altering them and using alternative forms of words. I asked him the difference between his words and mine. He thought about the matter for a long time and finally he said that he could not see any difference but that his phrases had been in common use for 25 years and had never got anybody into trouble. That is the sort of standard that has led to criticism of the Public Service, but it is something that exists and is very hard to break down. I welcome people who enter the Service at the lower grades and who bring with them efficiency but not tradition.

With regard to educational standards, I think the answer to Senator Willesee’s remark is that an energetic and capable person may enter the Service in the lower grades and reach a higher position. I entered the New South Wales service when I was sixteen years of age and bad reached an educational standard roughly equal to that required for the present intermediate certificate. I gained my higher qualifications while I was in the service.Professor Bland, who hasrendered great service to this Parliament and who before that service was a most distinguished academicianin New South Wales, where he was the first Professor of Government, entered the New South Wales PublicService at the age of fourteen years, and all his subsequent academic distinctions were gained as an evening student, except for one occasion when he was given leave and went tothe University of London. However, I agree that it is preferable if the better standards can be attained early so ‘that people are able at that stage. That is all I wish to say as a general criticism of the bill. I shall be listening to the debate in committee.

I wish to refer to a matter which has been much discussed outside the Parliament. That is the employment of married women in the service. That there is nothing about that matter in this bill is not a criticism of the bill. I am fully in favour of the employment of married women in the Public Service, but it is a very complicated problem. One matter that must be considered is whether the Public Service should encourage young married women with children to continue their service. I am not referring to whether the employment of such women should be forbidden. I believe that the time has gone when it can be said that women should be denied the opportunity to serve in positions for which they have the qualifications, but themost intelligent woman I know is at the present time fully occupied with four young children.I know how difficult the job of managing them is because sometimes I helpher with them. “She is capable of ‘filling any position that I can think of in the academic world or anywhere else, but she is fully occupied with four children. This is something that must be taken into consideration: To what extent will the Public Service encourage the employment of married women?Personally, I do notthink a large number of married women will ever want to remain in the service. The women who wish to do so will be single women or women who have no children. It is not for the State to say that we have to encourage the second condition of affairs.

One most important point isthat I believe that the women who can best serve the Public Service are women who have married and whose children have grown up, but it is difficult for the Public Service to provide for them. I think the service should be flexible enough to do so. A woman couldleave the Public Service and, if she had the qualifications, retain the right to re-enter the service in fifteen years’ time or twenty years’ time. If she was a very young woman when she married, she would have quite an adequate period in which to give service to the Commonwealth. That is a case where private industryhas the flexibility that I am afraid can never be achieved within the Public Service. I welcome the bill and I welcome all the elements of flexibility that have been introduced in it.

SenatorMcMANUS (Victoria) [12.39]. - As Senator McCallum said, one purpose in setting up the Public Service Board was the prevention of political patronage or nepotism. Of course, there were several otherpurposes associated with the desire to promote efficiency in the Commonwealth Public Service. I have been interested in the references in the secondreading speech of the Minister for National Development (Senator Spooner) to the re-casting of the recruitment provisions of the Public Service Act, -because -recently on two or three occasions I have been critical,in respect of certain Government organizations or Government-controlled organizations, such as Trans- Australia Airlines,of amendments of the lawwhich appeared to me to leave the way open to patronageinappointments tothe serviceofthosebodies.

Therefore, Ihave carefullyscrutinized the bill and theMinister’ssecond-reading speech.I ampleasedtosee this statement in that speech -

It has been decided, therefore, to re-cast completelyDivision4 ofPartIII of the Public Service Act whichdealswithrecruitment and appointment. There is nevertheless, no departure inthenewprovisionsfromthebroadprinciples onwhichthepresentlegislationisfounded.

Ihopethattherewillneverbeanydeparturefromtheprinciplethatthemakingof appointments to or promotions in the Public Service shall be on merit, and that, as far as possible, no opportunity shall be given for undesirable influences to be used to the advantage of anybody. I am pleased to see that appointments to the Service will remain in the hands of the Public Service Board as an independent authority and within the principle of open competition. I hope that that will continue, because if we are to have confidence in the making of appointments it is essential that we should be sure that there is no scope for political patronage. Another matter to which I want to refer comes under the heading of criteria for promotion. I notice that the Boyer committee recommended that seniority as a criterion for promotion should be dropped entirely from the 'Public Service Act and Regulations. I disagree. As one who has been a member of the teaching service of Victoria, I disagree entirely with any suggestionthat seniority should be dropped entirely. Of course, I believe, as every one does, that efficiency or ability to do the job has to be the first qualification. But I also believe that the question of seniority can never be removed from consideration in regard to promotions if we are to have a contented Public Service. I have a very high opinion of the Public Service Board and its officers. I also had ahigh opinion of the officers of a similar body in Victoria. But, as in all human institutions, one or two of its members possessed human frailties. I have known instances where men who had done a good job over the years and deserved promotion were deprived of it because of a dislike, a distrust, or perhaps a doubt in the minds of the people in whose hands their future lay. I believe that seniority should be taken into consideration. In the Minister's second-reading speech, reference is made to a statement in regard to certain appointments that, where the qualifications of the two candidates were equal, seniority should prevail. That is highly desirable and highly necessary. I therefore repeat thatI believe seniority should be retained inthe consideration of the qualifications of candidates for appointment. I have a great deal of admiration for the officers of theCommonwealth Public Service. Those of us who have to deal with them are impressed by the courtesy which is always shown to us in any inquiries we make of, or demands we make upon, the Service. Thatis very creditable to the officers, and it is also creditable to the Public Service Board, which appears to me to be efficiently conducting the affairs of the Service at the present time, and also adopting a very reasonable outlook on the many problems which come before it. {: #subdebate-24-0-s2 .speaker-K7A} ##### Senator SPOONER:
New South WalesVicePresident of the Executive Council and Minister for National Development · LP -- in reply - The Opposition is not opposing the bill. I propose to answer during the committee stage the points that **Senator Willesee** has raised in his secondreading speech. I should like to tilt a lance with him on some of the points he made and I should like to have an opportunity to consider what I should say. Therefore, I suggest that the bill be read a second time and then the matter be considered in more detail incommittee. Question resolved in the affirmative. Bill read a second time. Sitting suspended from 12.45 to 2.15 p.m. In committee: Clauses 1 to 10 agreed to. Clause 11. The heading to Division 4 of Part III. and sections thirty-three to forty-seven A (inclusive) of the Principal Act are repealed and the following heading and sections inserted in their stead: - " Division4. - Appointment and Recruitment of Officers. " 34. A person is not eligible for appointment to the Commonwealth Service unless - {: type="a" start="a"} 0. he is a British subject; 1. the Board is satisfied, after he has undergone a medical examination approved by the Board, as to his health and physical fitness: 2. the Board is satisfied that he is a fit and proper person tobe an officer of the Commonwealth Service; and 3. he has made and subscribed, as prescribed, an oath or affirmation in accordance with -the Fourth Schedule to this Act. "45. - (1.) The Board may, from time to time- 4. holdexaminations, or cause examinations to be held on its behalf, for the purposes of this Division; " (3.) An examination shall not be held under this section unless adequate public notice has been given, by notice published in the Gazette or otherwise, of the intention to hold the examination and of the prescribed particulars in relation to the examination. "47c.-(1.)WheretheBoardissatisfiedthat- 5. a person who was an officer - {: type="i" start="i"} 0. retired from the Commonwealth Service in order to become a candidate for election as a member of a House of the Parliament of the Commonwealth or of a State; 1. was a candidate at the election; and 2. failed to be elected; and 6. the retirement took effect not earlier than one month before the date on which nominations for the election closed, the Board may, upon application by that person within two months after the declaration of the result of the election, re-appoint him to the Commonwealth Service under this section, at the same salary as he had immediately before his retirement. " (2.) A person may be re-appointed under this section without being required to undergo any medical examination and whether or not he is within the appropriate age limits for appointment determined under this Division or possesses the prescribed educational qualification. " (3.) A person may, if the Board thinks fit, be re-appointed under this section without probation. {: #subdebate-24-0-s3 .speaker-KBC} ##### Senator WILLESEE:
Western Australia -- I move - >At the end of the proposed section thirty-four, add the following sub-section: - " (2.) Notwithstanding paragraph (b) of the last preceding sub-section, the Board may, if it considers that it is desirable to do so, appoint to the Commonwealth Service, as an officer of the Second, Third or Fourth Division, a person otherwise eligible for appointment who, because of some physical defect, is not able to satisfy the Board as to his health and physical fitness, whether the physical defect from which he is suffering is due to war service or not.". I outlined briefly the purpose of this amendment during the second-reading stage. I know that this is a question that is fraught with difficulty in the community as a whole, as well as in the Public Service. Firstly, the Opposition thinks that the Commonwealth Government should give a very clear lead in this field, and secondly, it thinks that the Commonwealth Public Service offers a greater opportunity than other fields of activity for the employment of handicapped persons because of the wide spectrum of jobs in the service. The establishment of rehabilitation centres operated by the social service authorities has given rise to a new outlook on the employment of physically handicapped people. In moving this amendment, the Opposition does not suggest that the Public Service has not in the past paid some regard to disabled people. It has them within its ranks, for a start. If somebody is injured and cannot carry on the duties for which he was appointed, the board has the problem of demoting him or transferring him to another job. The board also has to face the problem of bringing back into the service people who have been out of it for some time on account of ill health. The Opposition is well aware of the problems associated with this matter, but it feels that it is time that a stand was made and that clear provision was made in the act to recognize the responsibility that rests on a body which represents the Commonwealth Government as an employing agency. {: #subdebate-24-0-s4 .speaker-K7A} ##### Senator SPOONER:
New South WalesVicePresident of the Executive Council and Minister for National Development · LP -- This problem was dealt with at some length in my second-reading speech. It is a great social problem. I am glad that **Senator Willesee** recognizes that the Commonwealth, through the Public Service Board, already has a creditable record in making a contribution to a solution of the problem. I am sure we all hope that it will not only continue to do this but will do even more in the future. It is one thing for the Commonwealth to do all it can, but it is another thing to write an appropriate provision into a bill in specific terms. I am sorry to say that the Government is not prepared to do that. The Government is giving the question expert consideration. When a report has been received from the committee that has been constituted, the Government will tell the Parliament of the result of the committee's deliberations and will give the Parliament an opportunity to discuss the matter further, if it so desires, in the light of the decision that the Government makes, based on expert advice. Question put - >That the words proposed to be added **(Senator** Willesee's amendment) be added. The committee divided. (The Chairman - Senator the Hon. A. D. Reid.) AYES: 25 NOES: 28 Majority . . . . 3 AYES NOES Question so resolved in the negative. {: #subdebate-24-0-s5 .speaker-KBC} ##### Senator WILLESEE:
Western Australia -- I move - >After proposed section thirty-four, insert the following section: - "'34a. - (1.) Where the Board decides that it is not satisfied that an applicant for appointment to the Commonwealth Service is a fit and proper person to be appointed to the Commonwealth Service, the Board shall inform the applicant, in writing, of that fact if so requested by the applicant. (2.) The applicant may, within such period as is prescribed, appeal against the decision of the Board to the Commonwealth Industrial Court. (3.) The Board shall be the respondent in the appeal. (4.) The Commonwealth Industrial Court has jurisdiction to hear and determine an appeal under this section, and shall, if it is satisfied that the applicant is a fit and proper person to be appointed to the Commonwealth Service, order that the applicant be treated by the Board as not ineligible for appointment to the Commonwealth Service by reason of paragraph (c) of the last preceding section. (5.) The jurisdiction of the Commonwealth Industrial Court under this section may be exercised by a single judge.". I should like to say, **Mr. Chairman,** that the double negative contained in the amendment is not the product of my thinking; it has been taken from the amending bill. I thought that the expression was fascinating. The purpose of my amendment is fairly obvious. It is to try to protect the rights of a citizen in an issue that is crucial to him, namely, his livelihood. As I indicated during the second-reading debate, one does not need a great deal of imagination to see that a mistake can very easily be made. Even if a mistake is not made, there may be many interpretations of the phrase " a fit and proper person ". Dealing first with the question of a mistake being made, I mention that it is within my own personal knowledge that mistakes have been made. When a lot of people are being taken into the service of a department a snap check is made. It is very easy for confusion to arise in connexion with names, and a situation can be arrived at in which an applicant could be rejected on another person's record. I know of a case in which that was about to happen but fortunately the mistake was noticed and the matter was rectified. If it had not been rectified, the poor fellow concerned would never have known that his application was rejected due to a mistake. Under the present law, there is no obligation on anybody to inform him of what has happened. Therefore, a very serious wrong can be done. I do not think that anybody would want to be placed in the position of injuring a person for the remainder of his life. This is a punishment that no court would ever impose. I come now to the other aspect of the matter, culpability. Let us consider the case of a person who is convicted and fined £5 for participating in a fight. There is nothing in the measure to say what view the board would take of such a conviction. It might take the view that the applicant was a violent person who had already struck another person and that therefore he was not a fit and proper person to be employed among junior staff, or in any position in which because of his physical attributes he could force his will on other people. On the other hand, an independent body might take the view that the offence happened donkeys' years ago, that the applicant had since had a completely clear record and that, therefore, the conviction did not warrant the rejection of his application. Frankly, I do not know what should be done in those circumstances. In my younger days, I would have been inclined to say, " Let it go ". But as one matures he realizes the tremendous responsibility that is entailed in these matters. The person making the appointment wonders whether a person, if promoted, would make the lives of his subordinates a misery or otherwise, or whether he would encourage them or otherwise, and consequently he hesitates to make a decision. The amendment seeks to guard against the board, or a department exercising power delegated by the board, making a serious mistake or mistakes which, could affect people for the remainder of their lives. The amendment places an obligation on the applicant to- make a request to the board to inform him in writing if his application is rejected on the ground that he is not a fit and proper person. I should say that the Opposition considered when framing its amendment whether an obligation should be placed on the board so to. inform such an applicant, but we decided that some responsibility should be placed on the individual himself. Surely if he were a hardened criminal he would not seek such written advice from the board. We thought it better to release the board from the obligation to inform an. applicant to this effect other than in response to a request by him. The next move is for a rejected applicant to appeal to an independent body on any ground that he thinks fit. I. think that the two grounds I have mentioned are worthy of consideration. I urge the Minister to consider seriously the amendment I have proposed. The amendment provides that an appeal may be made to the Commonwealth Industrial Court, but we are not wedded to that proposal; the Minister may consider that appeals should lie to another body. On the other hand, the Minister may take the view that it is sufficient for the board to inform the rejected applicant that it does not con sider him to be a fit and proper person for appointment, and that the next move should then be up to the applicant himself to write to the board or appeal to a member to assist him. In putting forward our proposal, we thought that a watertight provision should be made in the legislation, by specifying that an appeal may be made to the Commonwealth Industrial Court, which is used to handling problems of this type. The Opposition has suggested this amendment in order to protect people who otherwise might be the victims of wrong decisions, and I trust that the Minister will accept it. {: #subdebate-24-0-s6 .speaker-K7A} ##### Senator SPOONER:
New South WalesVicePresident of the Executive Council and Minister for National Development · LP -- I point out to **Senator Willesee** that the clause relates to appointment to the Public Service. It does not seek to provide protection for persons who are already members of the Service. The clause prescribes circumstances in which persons shall not be eligible for appointment, but once a person is appointed, his rights and his position are protected in many ways within the existing four corners of the act. To say that provision should be made for appeals against decisions of a statutory body which has been given authority under an act of Parliament to decide the circumstances in which persons shall not be eligible for appointment to the Public Service, is an unusual concept. If honorable senators refer to paragraph (c) of proposed new section 34, they will see that it states that a person shall not be eligible for appointment to the Service unless the board is satisfied that he is a fit and proper person to be an officer of the Service. I think that we have to proceed on the assumption that that provisionwill be applied in a responsible way. li do not think that we should pay overmuch attention to the circumstances mentioned by **Senator Willesee.** He referred to the possibility of mistakes being made.. I cannot conceive of circumstances in which-> a body such as the Public Service Board! would not lean over backwards to rectify a mistake if it thought that one had been* made. I suggest that such a body would i go out of its way to correct a mistake. In my view, it is infinitely preferable to' leave the provision as it stands, rather; than' to take the important step of interfering with the basic, normal right of an employer to choose employees from the applicants who present themselves or who seek employment with him. That right corresponds with the normal right of an employee to decide for whom he shall work. After all, the board is not given unfettered discretion. The restriction of eligibility is within a fairly narrow compass, lt is the view of the Government that it would be better to allow the provision to remain as it is in the bill. {: #subdebate-24-0-s7 .speaker-KBC} ##### Senator WILLESEE:
Western Australia -- I appreciate the Minister's point of view, but I ask him to have regard to the fact that the words " fit and proper " have not been defined in the bill, and that being so, there is scope for a variety of interpretations of their meaning. If the provision were in terms such as those found in electoral acts, whereby a person may be indicted for an offence and be subject to a fine on conviction, there would be no objection. But so far, we have been discussing criminal records, and it might be possible for all kind's of other considerations, such as known character, about which we have heard so much recently, to apply. I do not wish my reference to mistakes to be misunderstood. I agree that a body that was worth its salt would not fail to rectify a mistake if it knew that one had been made. But, **Mr. Temporary Chairman,** a mistake may be made without the person or instrumentality who makes it knowing about it. Let me refer to one of the few such mistakes of which I have knowledge. A man had been told that he was not employable, but no reason was given, although in fact the reason was that it was thought that he had a criminal record. It was subsequently discovered that his name was identical with that of his father. The man of whom I am speaking was a returned soldier, was married and had a couple of children, and had never seen the inside of a court. Fortunately, the truth was accidentally stumbled upon, but had the file been put away, it might never have been discovered. Yet, in the first place he had been told: "We do not want you. There is no place for you." In another case of which I know - it was rather amusing, although it could have had serious consequences - a cleaner received a written instruction to the effect that, because of his record, he was to be dismissed. A few weeks later, the man who had written the instruction saw a person, whom he thought to be the person to whom the instruction had been addressed, standing on a ladder. He spoke to him and wanted to know why the instruction had not been carried out. He did not know until later that the man to whom he spoke had a twin brother. He, therefore, had dismissed one brother on paper and the other on sight, assuming that his instruction had not been observed. I suggest that there is a possibility of that kind of thing happening, particularly in view of the large number of employees in the various departments. The Minister has spoken of the normal rights of an employer. I suggest, however, that the Public Service Board has greater responsibilities than those of the normal employer. In private industry, the right to hire and fire is completely in the hands of the employer. He has the right to sack an employee if he wishes to do so, according to his whim or fancy. I do not think that that principle should1 apply in the case of a public body, which surely must have a greater sense of responsibility. I say to the Minister that if the board had the normal rights of an employer to hire and fire, the clause that we are discussing would not have been included in the bill. Amendment negatived. {: #subdebate-24-0-s8 .speaker-KBC} ##### Senator WILLESEE:
Western Australia -- I move - >In proposed section 45, sub-section (3.), leave out " in the Gazette or otherwise ", insert " in the Gazette and in such other manner as the Board considers advisable.". Sub-section (3.) of proposed section 45, which Lt is sought to amend, reads as follows: - >An examination shall not be held under this section unless adequate public notice has been given, by notice published in the Gazette or otherwise, of the intention to hold the examination and of the prescribed particulars in relation to the examination. Our objection to the provision is that there is a tendency to move away from the use of the Commonwealth " Gazette " to make known particulars of Public Service examinations, although that has been the practice for many years. I know that it may not always be possible to notify particulars by publication in the " Gazette ". There may not always be sufficient time to do so; but what is meant by the words " by notice published in the Gazette or otherwise "? Are we to take it that notification will be given by publication on the back page of the Snake Gully " Times ", or by a notice tacked up outside the local post office or pub, or, if that is not a suitable place, pinned to the old gum tree near the swamp? I am not saying that that is what the board intends. I am merely saying that such expressions as " or otherwise " should not be used in important legislation. The wording should be more specific. I do not accept the view that there is a time limit involved in this matter. I would assume that about only two weeks would be required in which to forward a notice from any part of Australia, for it to be checked by the Public Service Board, sent to the Government Printing Office, and inserted in the " Gazette ". The provision we wish to see inserted in the act would impose an obligation to have the matter recorded officially and also to bring it to the notice of the public in any way deemed fit. {: #subdebate-24-0-s9 .speaker-K7A} ##### Senator SPOONER:
Vice-President of the Executive Council and Minister for National Development · New South Wales · LP -- On the face of it, this seems to be a comparatively minor amendment. It stems from the thought that notice of an examination will not be published in the " Gazette ". In practice, such notices will be inserted in the " Gazette ". The kind of situation which the bill is intended to cover is that in which an examination is to be held for a junior postal officer in a remote country area. The board suggested to the Government that its administration would be facilitated if, when there was to be an examination for a junior position in some remote places like Bourke or Darwin, it could advertise in the local newspaper instead of inserting a notice in the " Gazette " with the possibility that the " Gazette " notice would not be seen. It was pointed out that an advertisement in a local publication would be a subject of local consideration and comment. It is not expected that such a procedure would be adopted, except to cover the circumstances I have mentioned and in which at the present time the existing arrangement has some disadvantage. {: #subdebate-24-0-s10 .speaker-KBC} ##### Senator WILLESEE:
Western Australia , - It seems to me that there is no argument against the Opposition's proposal. The Minister states that the relevant provision in the bill seeks to expedite the work of the board and that it is visualized that it will be applied only on rare occasions. That seems to me to provide a perfect argument in favour of the Opposition's amendment. The fact that more time would be involved if the notice were inserted in the " Gazette " does not impress me, because there are air services all over Australia. I cannot visualize a situation in which an examination for even a junior postal officer would not be in some one's mind at least a fortnight before. Perhaps this is not a major issue and perhaps no one will be injured, but why should we drop our guard and allow even a remote possibility for that to occur? Amendment negatived. {: #subdebate-24-0-s11 .speaker-KBC} ##### Senator WILLESEE:
Western Australia -- I move - >In proposed section 47c, sub-section (1.), leave out " may ", insert " shall ". Proposed new section 47c (1.) relates to the re-appointment of persons who have retired from the Commonwealth Public Service to become candidates for an election. The existing provision in the act was inserted in 1947. Prior to that a very unsatisfactory state of affairs existed. Public servants were, in effect, second-class citizens. If they dared to stand for election to a State parliament or the Commonwealth Parliament, they had to resign from the Public Service. They were pariahs; they had no rights when they sought re-entry to the Public Service. The act was amended in 1947, in my view quite rightly. I can quite understand that on such an occasion a person would want to leave himself some room in which to manoeuvre if a crisis arose. But the proposed new section is not worth the paper it is written on. I know, of course, that if a man is wanted back in the Public Service he is taken back irrespective of whether or not there is legislation covering the situation; a loophole is found. What we now seek to do, and what it was set out to do in 1947, was to give a person an inalienable right to get back into the Public Service irrespective of his political opinion. Surely the proposition I am advancing is attractive to most people. Surely we have reached that stage in our development where officially we do not hold against any person the fact that he has certain political or personal opinions. When all is said and done, no legislation can drive opinions out of the minds of men. If the word " may " remains in the legislation, a person may resign from the Public Service one month before an election, he may contest that election and fail, and then the powers that be may go over him with a fine-tooth comb to discover some reason why he should not be reinstated. I was interested to note that, during the debate in another place, the Prime Minister **(Mr. Menzies)** was attracted to this amendment. He was worried, though, about the superannuation aspect. 1 readily see his objection. But I suggest that it would not be difficult to overcome the problem. Under the normal procedures, when a person resigns the Superannuation Board immediately proceeds to refund to him his contributions to the superannuation fund. The point taken is that if the word " shall " were inserted in the proposed new subsection and the officer in question was reinstated, he could say, " The provision says nothing about the money I have received from the Superannuation Board. It is for the board to work out where I stand." I have no doubt that the board would handle that situation all right, but I agree that we should not throw the responsibility on to its shoulders. But surely the difficulty could be overcome if we provided that in such cases the contributions should be retained until the statutory period had expired. Then, if the officer concerned were to be reinstated, the order for his superannuation contributions to be paid to him could be cancelled. I am pleased that the Prime Minister saw the wisdom in this amendment. However, I appreciate his difficulty. But I am wondering whether, a day or two having elapsed since he dealt with the matter, the Government will now look upon it favorably. {: #subdebate-24-0-s12 .speaker-K7A} ##### Senator SPOONER:
Vice-President of the Executive Council and Minister for National Development · New South Wales · LP -- There is no divergence of views between the Government and the Opposition upon the principle that, if a person resigns from the Public Service to contest an election and he is unsuccessful, he should have the right to take back his position in the service. There is no known instance of a person who, having resigned to contest an election and having been unsuccessful, was denied re-appointment. As the Prime Minister **(Mr. Menzies)** said in another place, the amendment has great merit. But he was advised that the superannuation aspect of the matter should be considered. It may well be that if the Public Service Act were amended in the manner proposed by the Opposition, it would be necessary to amend the Superannuation Act as well in order to give legal effect to something which at the moment operates satisfactorily in a practical way. Whilst I cannot accept the amendment, I tell the committee that the Government will look at the position under the Public Service Act and the corresponding position under the Superannuation Act, and will decide whether to amend the Public Service Act further or, if necessary, to amend both acts. {: #subdebate-24-0-s13 .speaker-KBW} ##### Senator WRIGHT:
Tasmania .- I want to be heard only briefly. I have listened to **Senator Willesee** with a good deal of respect. When dealing with the question of the reinstatement of defeated political candidates in the Public Service, possibly after a change of government, it is very important to decide whether or not there should be a legal right to reinstatement. I do not think that this should be a matter of a discretion, exercisable by the Public Service Board to discriminate in favour of candidates who are favoured by a new government, of whatever colour. To my way of thinking, this a matter in which there should be a strengthening of the security of the individual, if the policy is one of reinstatment. I am not of course, protesting against deferment of the matter for further consideration. I rise only to be heard in support of the claim that no Public Service Board should have the right to discriminate, when a decision might turn upon the attitude to defeated political candidates. Amendment negatived. {: #subdebate-24-0-s14 .speaker-KBC} ##### Senator WILLESEE:
Western Australia -- I move - >In proposed section 47c, sub-section (2.), leave out "may", insert "shall". This amendment is a corollary of the one we have just debated.. Amendment negatived. {: #subdebate-24-0-s15 .speaker-KBC} ##### Senator WILLESEE:
Western Australia -- I move - >In proposed section 47c, omit sub-section (3.), insert the following sub-section: - " ' (3.) The re-appointment of a person under this section shall be without probation.". If a defeated candidate has. the right to come back to the service, he should have the right to come back without probation. After all', he served a period of probation perhaps twenty years ago, upon entering the service. We desire also that he be brought back without medical examination. If the authorities want to get rid of such a person, they should charge him, if they can, with a breach of duty. They should not go over the regulations- with a fine-tooth comb to find an excuse for keeping him out. If he was medically unfit in the week before he resigned, it would be the department's responsibility to say that he was unfit to continue in the service. The department should not be permitted to say later that in three months his health had deteriorated to such a degree that he should not be readmitted. There are loopholes that allow the authorities to pick a fellow off under the medical, probation and other provisions, when, in fact, he is being got at for political reasons. Amendment negatived. {: #subdebate-24-0-s16 .speaker-KBC} ##### Senator WILLESEE:
Western Australia -- I move - >After proposed section forty-seven c insert the following section: - "'47ca. - (1.) A person who has been an employee for a continuous period of not less than twenty years is, subject to this section, entitled to be appointed as an officer of the Commonwealth Service, in an office the duties and salary applicable to which are substantially the same as the duties and salary applicable to him as an employee. (2.) The appointment of a person to the Commonwealth Service in pursuance of the last preceding sub-section shall be without probation. (3.) A person to whom sub-section (1.) of this section applies shall not be required to undergo any medical examination before appointment and shall be appointed' in accordance with that sub-section whether or not he is within the appopriate age limits for appointment determined under this Division or possesses the prescribed educational qualification.':". As I indicated in my speech during the second-reading debate, the amendment is designed to protect the rights of temporary employees who have had twenty years' service. Surely we have not been hard in suggesting a period of twenty years. If it is good enough for the Public Service to take the benefit of a man's services for twenty years, it is good enough to give him the rights, privileges and protection that he is entitled to in the Service, at least morally. I know that it is not possible to fix an optimum number of permanent officers for the Public Service and to say, " We do not want any more or any less. Extra requirements will be met in overtime or in some other way." The vagaries of the Commonwealth Government, in spending a lot of money one year and1 not so much the following year tend to push the Public Service Board into the employment of temporary officers. We are very lenient in suggesting that after twenty years of temporary service a permanent position should be found. I can understand that it may be necessary to employ a man for one, two or three years on, say, a line gang, when money is available, but a person who has served for twenty years has a moral right to permanent status. We are seeking to convert that to a legal right. There is also a psychological angle. It is all very well to say that when a man is engaged he knows that he is temporary and that the sword of Damocles will hang over his head from day to day, but that is not quite true in relation to the Public Service. I have pleaded with temporary employees, telling them that they were employed only temporarily and that they should get out and find another job. The reply has always been, " This is the Public Service. We are working for the Commonwealth Government As long as I am in good health and doing my job, they will see me right." That is the atmosphere that has developed. I suggest that the amendment be accepted in order to convert a moral right to a legal right. **Senator SPOONER** (New South Wales - Vice-President of the Executive Council and Minister for National Development) P.5]. - This is a basic question. The proposition is that because a person has been in the Public Service for twenty years, and hisappointmenthasassumedapermanent character, he should be given a permanency. That sounds, attractive superficially. But other matters must be taken intoconsideration. The Public Service is a career service. By its very nature it is bound by rules and classifications. Positions are divided into categories with rights of promotion and rights of appeal against promotions. All that is inseparable from the management of a big organization. To introduce the principle that those who may not have the educational qualifications or may not have the same experience as permanent officers are entitled to be appointed to a permanent classification would, I think, have a discouraging effect on other officers in the Service who have qualified for permanent appointment. There are basic differences in the two points of view. Another matter should be borne in mind. The Government is a good employer. It Should not be thought that a person who has been in its employ for twenty years will be harshly treated. There should be no suggestion that such persons are likely to lose their positions. They have certain pension rights.. They have certain leave and furlough rights, as indeed they should have. The Government has no intention of varying those arrangements or its policy in relation to those employees. The Government's attitude is that although there is no threat to the continuance of the employment of those people, it is neither practical nor desirable to make those employees permanent employees by virtue only of the accident, as it were, that they have been employed in a temporary capacity for a particular period of time. Amendment negatived. {: #subdebate-24-0-s17 .speaker-K7Y} ##### Senator TANGNEY:
Western Australia -- I wish to refer to proposed new section 47a which deals with the appointment of returned soldiers. The bill establishes a new educational standard for ex-servicemen. In his second-reading speech the Minister for National Development **(Senator Spooner)** said - >Since the First World War, ex-servicemen have enjoyed the following concessions: - > >Preference in appointment over other candidates. > >Eligibility for appointment up to age 51 years. > >Lower medical standards where the medical condition results from war service. > >Reduced education standards - in particular, the acceptance of a qualification of Intermediate examination standard for appointment to the Third Division. When this bill becomes law the educational requirements referred to in (d) will be altered. All ex-servicemen will be required to have the leaving certificate or such other certificate as is set as the basic standard for entry to the Third Division. I think this is a retrograde step and will react harshly on the ex-servicemen. More than twenty years have passed since the Second World War commenced and ex-servicemen of that war have not been at school for at least that period of time. Some of them had great difficulty in resuming their studies after the war.. Some were children of the depression years and consequently had to leave school after reaching the sixth grade and seek work. On returning from war service many of them entered the Public Service, studied and passed, in Western Australia at least, the junior examination. Those men have had years of service in the Public Service. It would be impossible for the majority of them to obtain the leving certificate after so many years away from school. Many of them have been doing a good job in the Public Service for a long time. Their work must have been satisfactory otherwise they would not have been retained in the service. It should be borne in mind that a person may obtain a leaving certificate with passes in drawing, music, art of speech, English, ancient history, geometry and trigonometry. Very few of those subjects would be of practical value to a person in the Public Service. I think that an ex-serviceman who has been employed for many years in the Public Service and has come in contact with the public has acquired more useful knowledge than he would if he possessed the remote academic qualifications to which I referred. I know of instances of ex-servicemen who, after leaving school, have worked hard to obtain the junior certificate. They have many years of service but are still classified as temporary employees, despite the fact that they have complied with the conditions laid down in the act. In view of the fact that these employees are not likely to become permanent employees until the end of next year I would like to know whether they will be required to obtain higher qualifications. I should like to know whether the tests proposed in these new provisions will come into operation immediately. I should also like to know whether ex-servicemen who have struggled to get the Intermediate Certificate, and who have not yet been able to secure permanent appointment, notwithstanding the fact that for years they have satisfactorily carried out their duties as temporary employees, will now be expected to attain the prescribed higher educational qualifications. In those circumstances, when will they secure some kind of permanency? At present their position seems to be like that of Kathleen Mavourneen. {: #subdebate-24-0-s18 .speaker-K7A} ##### Senator SPOONER:
New South WalesVicePresident of the Executive Council and Minister for National Development · LP -- In the main the bill continues preference in employment and concessions to ex-servicemen. Where there is equality of qualifications the ex-serviceman receives preference. If he has a disability due to war service he still enjoys the benefit of relaxed medical conditions. He retains eligibility for appointment up to 51 years of age, even though other applicants are not eligible at that age. The ex-serviceman may still go into the Fourth Division with an intermediate certificate and subsequently qualify for transfer to the Third Division. So, he is not denied career opportunities by virtue of the provisions in the bill. The practical position is that in only one State is there at present a waiting list of exservicemen seeking appointment. By and large, we have taken every precaution to see that this provision operates fairly. We will maintain existing arrangements for all ex-servicemen who have the minimum intermediate certificate and who have made application for entry to the Public Service. The door will not be shut where a person has made application under the old conditions. The alteration is that under this bill an ex-serviceman, and every one else, will need to have the leaving certificate as the minimum standard for entry into the Third Division, which is the stepping-off place for the important administrative positions in the Public Service. I am sure that there is acceptance of the view that it is most desirable to have minimum educational qualifications of the highest reasonable standards. I hope that there is acceptance of the view, but it is not unreasonable to say that in view of the period of time which has elapsed since ex-servicemen were overseas on war service we should require the minimum leaving certificate standard in this important sphere of governmental activity, remembering that the rights and privileges of ex-servicemen are retained in all the other directions which I have already enumerated. Clause agreed to. Clauses 12 to 15 - by leave - taken together, and agreed to. Clause 16 (Leave of absence to attend proceedings under Public Service Arbitration Act, &c.). {: #subdebate-24-0-s19 .speaker-KBC} ##### Senator WILLESEE:
Western Australia -- This clause seeks to amend section 69 of the principal act by omitting subsection (3.). The heading of that section is "Leave of absence to attend proceedings under Arbitration (Public Service) Act 1920 ". It allows leave with pay to be given to officers to enable them to appear in arbitration commission proceedings. That is a concession which is appreciated by the various people who are generally part-time officials in the various Public Service unions. The section also allows leave without pay for the preparation of arbitration claims. Sub-section (3.), which this clause seeks to omit, reads - >The periods during which any officer - > >is absent on leave granted pursuant to the last preceding sub-section; . . . shall for such purposes as are prescribed be included as part of the officer's period of service. That paragraph relates to leave of absence without pay. The clause seeks to take out of the act what I call an implication contained in the act, and leave the decision entirely to the discretion of the Public Service Board. It is true that on this point the board still has the right of veto. Nevertheless, there is an implication in the act that when such leave is granted without pay, in no way will that be held against the officer " for such purposes as are prescribed ". I know that nobody has got around to prescribing the purposes; but in general parlance that would be understood to mean that if, over a period of twenty years, a man had had six months' leave - two days here, a week there, and so on - at the end of that time he would not be told, " You have six months to go before you get your long service leave and while we are looking at that matter we note that you are not eligible for your sick leave or your recreation leave ". I know that it is only an implication, but I think it is an implication which should be left in the act. After the passing of this amendment to the act, the position will be that in every case the Public Service Board will have to pass judgment, whereas I imagine that the present machinery would be that the department would automatically be instructed not to take action in the way I have indicated. The Government may say that it is the difference between tweedle-dee and tweedle-dum. The final right of veto, in the first place, rests with the board, whereas in the other case it has the initial right to move to make a decision on it. I merely say that I am sure the present system has worked over the years without ill effect to the department and it has been deeply appreciated by the people who give such good service to the unions and the departments. If one looks at the regulations that flow from the Public Service Board, one will find that many of them have their genesis in the conferences which are held by the various Public Service organizations every year or two. I feel that this implication should be left in the act. At the moment I visualize something like this happening: If a departmental head reported adversely on an officer who he considers was taking too much leave, the Public Service Board would be hard put to agree with him, as the act is at present. But by this amendment of the act the matter is put on an even-money basis, as it were. If the same recommendation came forward, it would be much easier for the board to rule against the officer. At present the right is provided for people who can get themselves into all sorts of positions by appearing for unions. Sometimes their actions are viewed with favour, and sometimes with a great deal of disfavour. They do not get anything out of it; they are merely trying to make the Public Service a better place for their fellow workers to work in. I think we would all agree that that is pretty commendable. I believe that it is rather paltry to take this implication out of the act and put the final right in the hands of the board. For that reason, I express opposition to this clause. {: #subdebate-24-0-s20 .speaker-K7A} ##### Senator SPOONER:
New South WalesVicePresident of the Executive Council and Minister for National Development · LP -- As sometimes happens, this matter becomes a little more complicated when we delve into it. I propose to read from the brief that I have on it because one cannot get a grasp of all the clauses in a bill. This clause is part of a tidying-up operation. The only significant amendment is that in future the board will be able to determine that leave without pay may be counted as service for some purposes and not for others. There is no expansion or reduction in the purposes for which leave without pay may be granted. The board will be put in a position in which it will be able to determine whether or not the leave without pay is to count as service for any of the following purposes: Furlough, incremental advancement, recreation leave, seniority and sick leave. The board holds the view that the best way to go about this matter is to give it some flexibility in its administrative arrangements. The board believes that it is correct to say that both the Public Service associations and the Government have confidence in the board dealing with the matter impartially. **Senator Willesee** may remember that when this clause was debated in another place the Prime Minister **(Mr. Menzies)** gave a quite specific assurance that if there was any breach of the spirit in which these provisions have been administered in the past to the satisfaction of every one concerned, he would be prepared to make a statutory amendment to deal with it. Clause agreed to. Clauses 17 to 19 agreed to. Clause 20 (Leave of absence for service with other governments, &c). {: #subdebate-24-0-s21 .speaker-KBC} ##### Senator WILLESEE:
Western Australia -- This clause seeks to amend section 72a of the principal act by omitting subsection (2.) This really follows on the matter we have just been talking about. While 1 am on my feet I say in fairness to the board that I may have intimated that what the Government is doing in this clause and clause 18, which we allowed to pass, is a blow at officers of the department. That is not so. 1 disagree with it. Flexibility is already provided for in the act, because the board has the final say. On the question of confidence, it is very nice to say that you have great confidence in the board's officers to-day, but unfortunately these officers have not yet achieved immortality. They will pass on, and we do not know what type of people will follow them. Having regard to the way in which recruitment is hedged around, I am not suggesting that their successors will not be excellent people. Unfortunately, there is a tendency, of which we are all guilty in this place - including myself - not to watch these things as they should be watched and to allow them to become a little too flexible. After all, we are here to make the laws of the land. I do not wish to pursue the point further. I felt that there was an implication in the provision, both for and against an officer, and I felt that it should be left in the act. I appreciate the assurance given by the Prime Minister **(Mr. Menzies),** with which, I take it, the 'Minister for National Development is in complete accord. By raising the point, we have at least succeeded in having that assurance placed on record. Clause agreed to. Clauses 21 to *24* - by leave - taken together, and agreed to. Clause 25 (Transfer of employees of Repatriation Commission and War Service Homes Commissioner). {: #subdebate-24-0-s22 .speaker-KBC} ##### Senator WILLESEE:
Western Australia -- This clause seeks to amend section 81z of the principal act by omitting subsection (6.). I have a minor query to put to the Minister. The clause refers to the transfer from statutory bodies to the Public Service of employees of the Repatriation Commission and the War Service Homes Commissioner. Sub-section (6.) provides - >Any person transferred by virtue of this section who is on probation at the time of the transfer shall be deemed to be on probation under section thirty-seven of this Act for the period of probation unexpired at the date of the transfer. That seems to be reasonable. If a person is transferred, half-way through his probationary period, from a statutory body to the Public Service, I think he should be credited with the period of probation already served. I am wondering why the Government wants to take this provision out of the act. {: #subdebate-24-0-s23 .speaker-K7A} ##### Senator SPOONER:
Vice-President of the Executive Council and Minister for National Development · New South Wales · LP -- This provision was inserted a long time ago. The people in this category have already been transferred and the subsection no longer has practical application. Clause agreed to. Clauses 26 and 27 agreed to. Clause 28 (Temporary employment). {: #subdebate-24-0-s24 .speaker-KBC} ##### Senator WILLESEE:
Western Australia -- The proposed new provision states that certain sub-sections of section 82 of the principal act shall not apply in relation to the employment of persons in a temporary capacity to perform duties overseas, and in relation to employees performing duties overseas. One of the provisions referred to is sub-section (2.) of section 82, which states - >If the Board is satisfied that such assistance is required, the Board shall select, in such manner as is prescribed, from the register of applicants for temporary employment, such persons who are available as appear to be best qualified for the work. Another of the provisions referred to is sub-section (9.), which states - >A person shall not be engaged for employment in a temporary capacity under this Act unless he makes and subscribes an oath or affirmation in the form in the Fourth Schedule to this Act. It seems to me these are two very reasonable provisions, yet it is suggested that they shall not apply to persons of the type that I have mentioned. I am wondering what is the thought that underlies the proposed amendment. {: #subdebate-24-0-s25 .speaker-K7A} ##### Senator SPOONER:
New South WalesVicePresident of the Executive Council and Minister for National Development · LP -- According to the information supplied to me, this clause amends section 82 of the principal act. The amendment is designed to ensure that there is a positive power of employment in the section - at present this power is implied - and to exempt from the procedural provisions of the section the employment of temporary staff overseas. The provisions are inappropriate for such staff. 1 understand that to mean that, in relation to the engagement of temporary staff overseas, the circumstances are such that the officers concerned wish to be able to make the necessary arrangements without being tied down or handicapped by the provisions of the act, because those circumstances are such as to prevent the provisions from being applied in a practical way. Clause agreed to. Remainder of bill - by leave - taken as a whole, and agreed to. Bill reported without amendment. Motion (by **Senator Spooner)** proposed - >That the report be adopted. {: #subdebate-24-0-s26 .speaker-KBC} ##### Senator WILLESEE:
Western Australia -- I move - >That the bill be recommitted for the purpose of establishing in the bill the principle that the rates, or scales of rates, of salary payable to female officers shall not be less than the rates, or scales of rates, of salary payable to male officers performing equivalent duties. I am forced to take this action because the Standing Orders of this House, which differ from those of another place, prevent us from moving to amend the act. We can only move to amend the bill before us, or take other specific action in one or two ways. I am asking the Senate to recommit the bill for the specific purpose of placing this matter before the committee and of giving the committee a chance to speak about it. While Iam on my feet, let me say that there are one or two things that I said during the second-reading stage to which the Minister did not refer. I am sure that he overlooked them and that he would like to have an. opportunity to reply to them. I referred to the recommendation of the Boyer committee that there should be an increase ofthe salaries for base grade positions. I pointed out that although the Government is legislating to ensure that these officers will have higher qualifications, it is ignoring the corollary and is not increasing the salariesof these officers, as was recommended by the Boyer committee. {: .speaker-K7A} ##### Senator Spooner: -- Would you mind repeating that? {: .speaker-KBC} ##### Senator WILLESEE: -- The Minister will recall that during the second-reading stage I pointed out that the Boyer committee had recommended increased standards and that it had also recommended that the salaries of those on the base rate should be increased from something over £900 a year to more than £1,000 a year. I pointed out that the Government had done nothing about the second recommendation. It seems to me to be clear that if the Government is prepared to accept the first recommendation, it should also accept the second recommendation of this very efficient committee and increase the salaries to which I have referred. The other point I raised had to do with section 47, which provides for special appointments by the Governor-General from outside the Public Service. As the act stands at present, these appointments can be made only to specific positions. The board now asks for general power to appoint.I assume that that means to unattached positions. I shall offer no great criticism of that until I hear of the necessity for it, because I am sure that the Minister concedes that the matter is very jealously guarded. There are all sorts of safeguards, such as the fact that the recommendation for appointment must be accompanied by a certificate stating that no suitably qualified person within the service is available for the appointment, and the appointment papers must be laid on the table in each House of the Parliament. It seems to me that if the Government is to generalize in relation to these appointments instead of keeping them to a particular level, it will get away from the safeguards that are at present provided. I remind the Minister that he said during the second-reading debate that he would deal with these matters in committee. Adverting to the question of equal pay for the sexes for work of equal value, I think that the reason I am seeking to have the bill recommitted is self-evident. The Opposition believes that in the many fields in which women are performing duties with equal skill and vigour to that displayed by men and are satisfying the employing authority, they should receive the same pay as the men. I believe that we have already subscribed to the resolution of the International Labour Organization in this respect, and I think it is high time that the Government adopted the principle, as far as its own employees are concerned, of equal pay for the sexes for work of equal value efficiently carried out. {: #subdebate-24-0-s27 .speaker-K7A} ##### Senator SPOONER:
Vice-President of the Executive Council and Minister for National Development · New South Wales · LP -- **Mr. President,** the Government is not prepared to agree to the recommittal of the bill for the purposes that **Senator Willesee** has mentioned. He ranged over a very great field of argument, in which a number of very important issues was raised. For reasons that appealed to it, the Government did not make any provision in the bill in relation to the payment of equal wages to men and women for work of equal value. As has been pointed out previously, the Government regards that matter as one for determination by the arbitration tribunal. We believe that it would be quite wrong in principle for the Parliament to fix rates of pay. I remind the Senate that there is equal application of margins, that being the only sphere in which the Commonwealth is responsible. By that, I mean that the wage structure is in two parts; the basic wage is fixed by the arbitration tribunal and margins are fixed under the Public Service Act. In respect of margins, the Government pays equally, and in respect of the basic wage it accepts the decisions of the arbitration tribunal. I come now to the second point that was raised by **Senator Willesee,** concerning appointments under present section 47. Proposed new section 37 will govern the main source of recruitment of professional and specialist officers, while new section 38, which is along the same lines as present section 47, will apply to recruitments in special and exceptional cases. I remind **Senator Willesee** that under this bill persons will be appointed to a division, not to specified positions within a division. It is necessary to deal with batches of recruits, and they must be put into specified positions before their period of probation ends. Special appointments will be made under new section 88, which is the same in substance as existing section 47, the difference being that in future the board will be able to make the appointments; at present, they may be made only by the GovernorGeneral. **Senator Willesee** also pointed out that the Boyer committee had recommended an increase of the base rate salary. The Boyer committee recommended that theassured incremental range in the base grade of the Third Division be extended to a maximum salary of £1,083 per annum. The Government decided not to adopt this recommendation because there is a substantial difference between the salary structure and the promotion opportunities, provided in the Commonwealth Public Service and those in other services that have been cited for the purpose of comparison, including some State public services and the banking industry. We thought that it. would be undesirable to change the salary structure which was established only recently following an arbitration tribunal decision. It is all very well for the honorable senator to talk about altering the base in one division. There is a great deal of interlocking between that division and other divisions, and consequential adjustments, would be involved. For these reasons and other reasons the recommendation of the Boyer committee was not adopted by theGovernment. {: #subdebate-24-0-s28 .speaker-K7Y} ##### Senator TANGNEY:
Western Australia -- I should like to ask the Minister to elaborate some of the remarks he has. just made. Am I to understand from what he said that when a female professional, doctor or legal officer is appointed to the Public Service she does not receive pay equal to that paid to professional men in the service, although in the community it is a recognized practice- {: .speaker-K7A} ##### Senator Spooner: -- I rise to order.. **Senator Tangney** is proceeding to canvass, something that the Senate has not decided. {: .speaker-K7Y} ##### Senator TANGNEY: -- I am sorry. E thought the Minister gave an answer in.* relation to this matter. Question put - >That the motion **(Senator Willesee's)** be agreed to. The Senate divided. (The President - Senator the Hon. Sir Alister McMullin.) AYES: 22 NOES: 29 Majority . . 7 AYES NOES Question so resolved in the negative. Original question resolved in the affirmative. Report adopted. Bill read a third time. {: .page-start } page 2225 {:#debate-25} ### STATES GRANTS (UNIVERSITIES) BILL 1960 {:#subdebate-25-0} #### Second Reading Debate resumed from 7th December (vide page 2135), on motion by **Senator Spooner** - >That the bill be now read a second time. {: #subdebate-25-0-s0 .speaker-K7Y} ##### Senator TANGNEY:
Western Australia -- The Opposition supports the bill, **Mr. President.** The community has come to realize that no State university can exist without either Commonwealth aid or aid from a State instrumentality. Throughout the last 100 years, the major universities of Australia have played a very important part in the community. It is interesting to note that during the last twenty years the composition of the student body at our universities has undergone a great change. If we look at the statistics included in the report of the Australian Universities Commission, we see that to-day there are more full-time students attending our universities than there are part-time students. That is a complete reversal of form, except, perhaps, in the case of the University of Sydney and the University of Melbourne. At the latter university, the number of full-time students has always exceeded the number of part-time students. The University of Western Australia has always been different from the other universities of Australia, in that it is a free university. Unfortunately, in the last couple of years students undertaking courses in certain faculties, such as medicine and dentistry, have been obliged to pay fees. Generally speaking, however, it may be said that no fees are payable by students who undertake courses at that university. From its inception, it has had to depend on government grants and bequests. In this respect it has been very fortunate. A few years ago, when it was decided to establish a medical school in the university, the Western Australian representatives in this Parliament appealed over and over again for assistance for that proposal, but no Commonwealth assistance was forthcoming at that time. A very fine example of community spirit was given by the people of Western Australia in the way in which they rallied to the appeal for funds for the medical school. In every little hamlet and town in the State, committees were appointed, and people from all walks of life gave what they could to assist in the foundation of the school. In a very short space of time, about £500,000 was collected from the public, with no strings attached, and we were able to get our medical school going. Right from the time that the University of Western Australia was established, the people of that State were conscious of its value to the community. I have referred to that matter because I think that the economic position of the University of Western Australia is vastly different from that of every other Australian university. Just before the outbreak of World War II., I was the president of the students' council at that university when a survey was made of the kind of homes from which university students came, and other such matters. I believe that it was a .part of an Australia-wide survey that was being made at the time. We found that the number .of students attending the University of Western Australia who came from homes in which the only income was the basic wage was considerably higher than that of any other State. We also found that the number of full-time students taking professional courses, such as ..the medical course, who came from workingclass homes was only about 10 per cent, of the total number of students at the universities in the other States. I mention these matters because I think they are important. The figures showed that, until the last 20 years, a university education was regarded as the preserve of a few - those who could afford it. The aim of the Australian Labour Party has always been that those who may profit from a university education should not be deprived of such an education because of economic considerations. I notice that in the publication " Vestes " there is a rather slighting reference to parttime university students. I think that parttime students at a university are generally among the most conscientious students, because they are working their way through. They are keen on their courses because they give up their spare time to undertake courses of study, and they have to depend on themselves. There are part-time students of the University of Western Australia in this Parliament. We have the Minister for Territories **(Mr. Hasluck),** who is a very gifted graduate, and also the honorable member for Fremantle **(Mr. Beazley).** I was only one of the " also rans", but I did manage to graduate. But I had to travel up to 280 miles a week and to teach all day so that I could go to the university. **Sir Arthur** Tange, who is the head of the Department of External Affairs, was a part-time student at the University of Western Australia. **Dr. Coombs,** who holds the economic future or the economic fate of Australia in his hands, not only was a part-time student but for part of the time was an external student. Now he is the Pro-Chancellor of the -Australian National University and holds degrees from many universities overseas. If it had -not. been that the University of Western Australia had had such a fine record of service to its part-time and external students, I am quite certain that **Dr. Coombs** would mot he in the position which he occupies to-day. There are many others who owe a great debt, to the University of Western Australia. I suppose the same situation obtains in other States. I noticed in a recent magazine article a reference to university students who had a 5 p.m. to -8. p.m. complex. I thought that was rather slighting, because it referred to part-time students. If a student attends between 5 p.m. and 8 p.m., it means he is attending after he has done his day's work. Those students should be encouraged rather than discouraged. However, I should .not like to see the students of to-'day have to work as I had to work when I was at the university, without being able to participate in the student and corporate . life .of the university. I believe that only seven or eight honorary life memberships have been granted by the University , of Western Australia, but three of them were given to persons who were part-time students. I refer to **Dr. Coombs, Dr. Gorton** and myself. They were not given because df academic qualifications; otherwise, I would not have received one. They were awarded for the work we were able to do for the student body, which indicates that even part-time students take an interest, in their university and in student affairs generally. The University of Western Australia at first did not have adequate buildings. - Our Tin Pot Alley in Irwin-street was quite a joke, but within its walls there were very great teachers. The last, two survivors of the original staff are Professor Murdoch, who is well known to thousands of people not only in Australia but also beyond our shores, and Professor Ross, a very great scientist who is still active in the scientific world. Great masses of stone and concrete are .not needed to build a great university. The people who are within the walls of a university - its teachers and its students - make or mar the institution. At the same time, it is very helpful if one is able to study in the pleasant surroundings that are now to be found at most of the universities in. 'Australia. Over thepast few years the student population hasincreased. Accordingto the report of the Australian Universities Commission, it islikely to rise to 95,000 by 1966. That number represents a very high proportion of the Australian population. It will make us one of the most university-minded nations of the world. But it will also impose very heavy responsibilities. In 'the Commonwealth sphere, it was not until after the last war that the Federal Government had any financial interest in the universities.It decided, under the Commonwealth rehabilitation training scheme, to grant scholarships to exservicemen so that, as a result of university training, they could be rehabilitated in theprofessions. Later that scheme was merged into the Commonwealth scholarships scheme, which has afforded many students an opportunity to attend universities. Although the number of students attending our universities has trebled since 1950, the number of scholarships has remained the same. Only about 3,000 scholarships are awarded annually, but there are many more applicants who should receive them and who are being debarred from university education. This bill seeks to increase the number to 4,000, but that is still insufficient. The bill also makes provision for payments to the universities to improve their buildings so they may cope with more students. There is one aspect of this matter with which I most heartily disagree. It has been stated that £15,000 is to be spent in Western Australia to enclose the " Undercroft " for library purposes for the students. That has been an arena for free speech - a kind of Domain or Yarra Bank - ever since the university was built on the banks of the Swan. I do not think its like is to be found elsewhere in Australia. But, as I have indicated, because of theshortage of library accommodation it is to be enclosed as a temporary measure to house portion of the library. We know what the word " temporary " means. We have heard it for twenty years or more. We know a lot about its use in relation to public buildings and so on. I regret that portion of the money that is to be made available by the Commonwealth is to be spent in that way in Western Australia. If the university authorities are happyabout the matter, all I can do is to register a protest on behalf of the many thousands of students who have passed through the University of Western Australia, many of whom have written to me about the matter. I regret that the report of the Universities Commission, which took about fourteen months to compile, was presented to the Parliament only on 10th November. There has not been very much time for us to study anddebate it. It contains a greatdeal of worth-while materialwhich should be debated by the National Parliament, particularly when we are speaking about the disbursement of £100,000,000 within the next three years for the purposeof increasing university amenities throughout Australia. There is one part of the report which I believe calls for a little further consideration.I have in mind the fact that, although we are spending a lot of money to provide very fine buildings - I am in favour of it - those buildings are not being used for a large part of the year. Evening classes are held in some faculties, but, because of the vacations at the end of the first and second terms and the long vacation at the end of the third term, for almost one-third of the year those buildings are not used. The commission suggests that consideration should be given to a re-orientation of the university calendar so that more use may be made of the buildings to cope with more students. The staffing of universities is a very vexed question. It is of no use having a fine university building if you have only secondrate teachers. And we will get only secondrate teachers if we do not offer first-class amenities, salaries and so on. In this respect, there are differences between the various States. We know that one State university does not want to try to score off another. But they are all trying to build up their own institutions. Instead of having rivalry between the States in the matter of staffing, many of the universities eventually will have to rely upon the products of their own efforts for staff. I do not know whether any consideration has been given to the training of university teachers. A person who has a brilliant degree will not necessarily become a brilliant orsuccessful university teacher. This is one aspect of university work that ought to be investigated, particularly in view of the high rate of failure of students, particularly in the first year of their studies. University education is costing Australia a great deal of money each year and we do not want to have waste by having a very large percentage of students failing in their first year. The causes of failure are varied. We could perhaps say that the principal cause is the defects in our secondary education, whereby students are taught, not to think for themselves, but only to cram for examinations. At the university, they are left out on a limb and they cannot cope with altered conditions. There may be something in that view. Nowadays, with all the pressures around us, I do not think that many students go to universities, as was the case formerly, just for the social prestige that it gives. If students do not do their work, after a reasonable time has been given for them to show what they are made of they are told not to come back. That is all to the good. A university course can be a great waste of time if a person sets out to have a good time and to do nothing else. That is not the case with university students as a whole. Some people get a false impression of them owing to their performances on certain occasions. That is a very superficial view to take. Those people that I know who have been through universities and become teachers and leaders in the community are fully aware of the debt that they owe to their universities and to the States which made a university education possible for them. Another feature of the report is the recommendation for continued financial support for the construction of university residential colleges. The proportion of students living at university colleges has increased considerably since the war. In Western Australia, quite recently, a very fine women's college, St. Catherine's College, was opened, and there are two other highly-regarded residential colleges conducted by churches. There is also the university hostel, which has played a big part in university life. The premises came to us as a lease-lend arrangement after World War II. They were temporary buildings erected to house American submarine crews who were based in Perth. When the war was over, the university authorities got me to approach the then Minister for the Army to see whether they could get these wooden huts for a time to house university students. This was agreed to, and they have been a wonderful asset. They do not look very grand, but they are quite all right inside. They are formed into two sections, one for men and one for women, and they have provided accommodation at an intermediate cost, midway between the cost of living in the colleges and the cost of living in rooms in the suburb where the university is located. That hostel has built up traditions over the years. Now that the women have moved to St. Catherine's College, more accommodation is available in a good environment for country students. They are not second-rate students. This suggests one solution of the problem of providing students with some kind of residential accommodation. The provision of worthwhile colleges involves terrific expenditure. More could be done along the lines of the university hostel in Perth, where many of the advantages of corporate living are available at a mere fraction of the normal cost. At this late hour of the day, at the end of a busy week, I do not wish to say much more. The measure is not controversial. Many problems remain to be solved. The only criticism I make at this juncture is that we have not had time to receive from the various university authorities their comments on this report. We have been so deluged with all kinds of legislation in the last week or so that we have not had time to study the report properly. I received notice only yesterday that I was to lead for the Opposition in the debate on the bill, and I know that I have not done full justice to its importance. It is one of the most important bills with which we have had to deal. I regret that it is being hurried through in this way. I hope that when we receive the second report of the Australian Universities Commission, which is composed of men of the highest calibre in the academic world, we shall have more time to study and discuss it. I support the bill. {: #subdebate-25-0-s1 .speaker-KT8} ##### Senator McCALLUM:
New South Wales .- The task that the Commonwealth Government has undertaken in making provision for universities is most important. Now that we have this bill and this report, we are only beginning to realize how enormous the task is and how greatly it will increase in the future. We accept the advice of the Australian Universities Commission, which this Government established. Although that commission has no authority over the universities, it must advise them indirectly, and unless the universities accept the advice that is contained in the report and written into the bill they will be failing in their duty. What is really being undertaken is the re-shaping of our whole system of tertiary education. At present we have universities which began as bodies pursuing liberal studies. Then one or two technical duties such as the teaching of physicians and surgeons were added. We have a large number of technical and other tertiary bodies. We must re-shape them so as not to lose what is good from the old, while fitting ourselves for a changing world. The essential thing about the report and the bill is that they look forward to the future and do not minimize the task. One recommendation of the commission which I heartily welcome is that which says that the universities themselves must re-shape the courses if they are to be re-shaped. If the courses were re-shaped from outside - by this Parliament, a State parliament, or some other body - we might easily lose much that was good. I was interested to read in the schedule - which is worth reading - that two technical bodies are grouped with the University of South Australia. These are the South Australian School of Mines and the South Australian Institute of Technology. The important point is that the universities themselves must see that such technical bodies as come into the universities maintain university standards, although we shall have to have tertiary bodies of other kinds doing something that is, perhaps, slightly inferior. We do not create a university by calling something a university. There are bodies not called universities which have fulfilled the best of the university spirit. One of these is the great institute of technology in Massachusetts. That is all I have to say. People should know that this bill has been considered, that the report has been considered, and that the members of the Senate know what they are doing in supporting it. I support it with the greatest pleasure and pride, because I think it will go down to the credit of everybody in the Senate and also to the credit of the Prime Minister **(Mr. Menzies)** and the other members of Cabinet who determined to take the course that we are now pursuing. {: #subdebate-25-0-s2 .speaker-KUD} ##### Senator McMANUS:
Victoria -- I support the bill. I congratulate the Government on having accepted this financial responsibility. There has been some adverse criticism of the Government's refusal to enter the field of secondary and primary education, which it claims is the field of the States. It is good to see that the Commonwealth is accepting these responsibilities in tertiary education to the extent outlined in the bill. The universities are fortunate that the Government has accepted this financial responsibility. I think all of us realize that if the matter of finance had been left in the hands of the States, the universities would have fared by no means as well as they have under the present arrangement. I have noticed in recent years that business and industrial leaders have tended more and more to accept some responsibility towards university education. We are familiar with the fact that in other countries - notably the United States of America - some very important foundations have been established by business firms which have contributed greatly to university education. I used to feel that business organizations in this country had not accepted their responsibilities in this field. I am pleased to see an increasing tendency among those organizations to realize that they have a responsibility towards our universities. This is only right because the business organizations will depend on the universities to provide them with trained personnel in the years to come. I am not happy about the tendency of many business firms to-day to offer cadetships to brilliant young men and women to train at universities on the condition that they will eventually become employees of the companies concerned. I realize that this system provides an opportunity for young people to obtain university education which they otherwise may not be able to afford. But the system has disturbing implications in that the courses which those young people undertake are subject to a form of compulsion. The firm pays the piper and feels that it should call the tune. When a young person goes to a university he or she should have freedom of choiceof subjects and of the course to be undertaken. It is true that many young people would not otherwise be able to undertake a university education, but it rs undesirable that they should be forced to turn their attention in directions other than those in which they would most like to go. There has been some controversy in Victoria over this matter of cadetships. There are points for and against the system, which needs to be examined m the future. I congratulate the Government for having: increased the number of Commonwealth scholarships. I brought this matter to the attention of the Government last year and pointed out that there had been a big increase in the school population and in the number of applicants for Commonwealth scholarships, but there had been no corresponding increase in the number of scholarships awarded. I would have liked to have seen a greater increase, but 1,000 is a sizeable increase and I congratulate, the Government on its decision. One part of the Australian University Commission's report deals with a most serious aspect of university educationtoday - that of staffing. In regard to not only university education but also primary and secondary education we are somewhat inclined' to think that as long as we provide a lot of money to build schools we shall advance greatly the cause of education. It is useless to build schools unless we have qualified people to teach in them. Anybody who knows what has happened in Victoria knows that there are large numbers of persons teaching in primary and secondary schools who are by no means as qualified as they should' be for the positions that they are occupying. This- is not the fault of the teachers concerned. They have made their services available in order to help the State to overcome a crisis. It is undesirable to have p.:op!e appointed to a> school teaching staff- and to have the headmaster, after seeing them in action, decide to put them on to library, physical training or other wor-k because they are not capable of doing anything, else. The staff problem- in the- schools and the. universities is; very serious. In his seconds-reading speech the Minister for National Development **(Senator Spooner)** said - >Chapter MI. of the report- That is, the report of the Australian Universities Commission - deals with academic staff. !n spite of considerable staff recruitment in recent years, the number of students in relation to the number of staff is increasing and the position in Australia compares unfavorably with that in the United Kingdom. The commission goes on to suggest that universities must be prepared to consider far reaching changes in the form of university education, and in teaching methods, in order to meet this problem. As to the availability of additional staff, the commission, believes that Australian universities must rely in the main on their own resources- That is a most ominous statement - for new staff in the next decade. The commission estimates that by 1966 the number of staff would need to be more than doubled to keep pace with the increased number of students. The commission comments that " It is difficult to see the solution of this staffing problem if the present pattern of tertiary education persists ", but it points out that a similar problem exists in other countries. There is very cold comfort in the fact that other countries are in much the same position as Australia. I would say that the staff position in our universities is extremely serious. If honorable senators look at the Saturday issues of the Melbourne " Age " they will see columns of advertisements from our universities seeking qualified staff. When I realize that the Monash University is to be opened in Victoria soon, and when I remember that the Premier of Victoria has said that he must consider the possibility of establishing a third university there, what occurs to my mind is the problem of staffing those universities when already our lecturers are lecturing to more people than they should. If we are determined to rely on our own resources in the next decade we must bear in mind' that very attractive positions are open in overseas countries to trained university staff. Already we are losing people from this country to universities abroad, and we will continue to lose them. Therefore I think that the problem that transcends all others in university education to-day is the problem of obtaining, lecturers, professors' and. other trained staff: Not only is trained staff attracted abroad by better salaries, better conditions and better opportunities for research, but also private industry is making inroads into university staffs, particularly in engineering and similar faculties. This problem is related to the problem that occurs in the secondary schools. We must embark on a big training plan. That is one reason why I should have welcomed a greater increase in the number of Commonwealth scholarships. It would have been costly for the Government to double the number of scholarships from 3,000 to 6,000, but had it done so the Government would have reaped the reward of its action in the next four or five years when we experiencethe full effects of what is called the population explosion. The Government would have reaped the reward of a large number of university graduates available as trained personnel for industry. I hope that the Government will pay due regard to the warnings of the commission with respect to the staffing problem, and that it will examine the possibility of increasing the number of Commonwealth scholarships, bearing in mind the fact that any cost incurred will be recouped many times over. Finally, I have noted the provision to give assistance to university residential colleges. I am glad to see that provision in the bill, and I was pleased to hear **Senator Tangney** say that the number of students in residence is increasing. For some years I had an opportunity to be in a university residential college. It is a most rewarding experience which should be made available to as many Australians as possible. I should like an answer to this question, if possible: Do the provisions in regard to university colleges apply only to colleges that are officially associated with a university? Recently the provincial of a religious teaching order mentioned to me that his order is a very extensive one which provides secondary teachers for schools and colleges throughout Australia. Of course, nowadays it is necessary for more andmore of his teachers to have university degrees. He has reached the stage where he feels that he must build his own college to accommodate, during their university course, the members of his religious order who will teach in schools in the future. The question that was put to me was this: Does the Government provide assistance on this £1 for £1 basis to a residential college for the members of the order during the period when they are doing university courses with the object of becoming teachers later? {: #subdebate-25-0-s3 .speaker-K7A} ##### Senator SPOONER:
New South WalesVicePresident of the Executive Council and Minister for National Development · LP -- in reply - **Mr. Acting Deputy President, Senator McManushas** bowled a googly on the off-stump. This is not an easy question to answer. Previously, my answer would have been, " No, the spirit of the legislation must be to assist colleges within university grounds " rather than a college such as the one **Senator McManus** described. One can envisage that college being built, perhaps, in an outlying suburb. It might not be within a short distance of a university. {: .speaker-KUD} ##### Senator McManus: -I think the intention is to build it within a stone's throw of the university. SenatorSPOONER. - My instructing officer points to the definitions in the bill, which seems to be a safe course to follow. I will read the following definitions to **Senator McManus,** with the request that he does not askme to interpret them: - "Hall of Residence" means a hall, college, or other establishment administered by a University in a State at which any students of the University reside; "Residential College" means a residential college affiliated with, but not administered by, a University in a State. At this stage I can do no more than read those definitions and relate them to the overall situation that the university itself would make the decision on the matter. I assume that first of all it would be for theuniversity to make a formal declaration, or whatever the appropriate word is,that a college is a college within theuniversity, coming within those definitions. Having made that declaration, it would make a formal application to the Commonwealth. I am sorry that I am not more definite, but this is just one of those new points that must be expected to arise in any new legislation and new set of circumstances. Question resolved in the affirmative. Bill read a second time, and passed through its remaining stages without amendment or debate. {: .page-start } page 2232 {:#debate-26} ### CUSTOMS TARIFF BILL (No. 4) 1960 {:#subdebate-26-0} #### Second Reading Debate resumed from 7th December (vide page 2187), on motion by **Senator Henty** - >That the bill be now read a second time. {: #subdebate-26-0-s0 .speaker-KPK} ##### Senator KENNELLY:
Victoria -- **Mr. Acting Deputy President,** this bill proposes amendments of the schedule to the Customs Tariff Bill 1933-1960. The first schedule deals with alterations in respect of furnishing fabrics. The changes that the bill makes are based on the Tariff Board's findings. The second schedule deals with travel goods, chlorination regulators and controllers and voltage regulators. Another amendment contained in the bill deals with importations by the Government for the Government's use, pursuant to an agreement reached with the country from which the goods are imported. The third schedule of the bill increases the duty on unwrought copper. I take it, as the Minister for Customs and Excise **(Senator Henty)** said, that the increase of duty is to help the local industry. No doubt, this increase in the duty on unwrought copper is brought 'about because, unfortunately, the value is still ebbing out of our currency. I suppose all honorable senators on both sides of the chamber would like to know when that process will end. If it does not finish there will be bounties not only on unwrought copper, but on everything that we export. The Opposition agrees to the passage of the bill and trusts that the extra duty will help those who are interested in the copper industry. Question resolved in the affirmative. Bill read a second time, and passed through its remaining stages without requests or debate. {: .page-start } page 2232 {:#debate-27} ### CUSTOMS TARIFF (NEW ZEALAND PREFERENCE) BILL (No. 3) 1960 {:#subdebate-27-0} #### Second Reading Debate resumed from 7th December (vide page 2187), on motion by **Senator Henty** - >That the bill be now read a second time. {: #subdebate-27-0-s0 .speaker-KPK} ##### Senator KENNELLY:
Victoria -- This bill proposes amendments to the first and second schedules of the Customs Tariff (New Zealand Preference) Act and is complementary to the bill that has just been passed. It relates to moquettes with uncut woollen pile and to bags, cases and similar containers. The New Zealand preferential rates are being removed and goods that now come into Australia from New Zealand will come in under British preferential tariff treatment. The Opposition agrees to the passage of the bill. Question resolved in the affirmative. Bill read a second time, and passed through its remaining stages without requests or debate. {: .page-start } page 2232 {:#debate-28} ### COPPER BOUNTY BILL (No. 2) 1960 {:#subdebate-28-0} #### Second Reading Debate resumed from 7th December (vide page 2188), on motion by **Senator Henty-** >That the bill be now read a second time. {: #subdebate-28-0-s0 .speaker-KPK} ##### Senator KENNELLY:
Victoria -- The contents of this bill are based on a Tariff Board recommendation aimed at assisting local industries. By so doing, we will to some degree, however small, improve our overseas balances position. The bill provides for a maximum profit of 10 per cent, on capital involved for the companies that obtain this bounty. A bounty on copper was authorized by an act passed in 1958. A duty is levied when the overseas price of copper falls below £275 per ton and a bounty is paid, subject to the 10 per cent, profit ceiling to which I have referred. This is just another bill which is made necessary because of the decrease in the value of our currency. I do not know when we will cease passing such bills. It proposes to raise the price at which a duty is levied from £275 per ton to £290 per ton. It prescribes a maximum bounty of £35 per ton. There is one good thing about this bill and also about another bill which the Senate will be discussing later. The bounty will help the Mount Morgan Mining Company, which is really keeping the town of Mount Morgan in Queensland alive. Along with other members of the Constitutional Review Committee, I visited certain parts of Queensland, one of which was Mount Morgan. No doubt the case submitted by this company was such that sooner or later something had to be done in regard to copper and pyrites. Mount Morgan is a nice town, and I cannot bear to think of what would happen to the dwellings that are there and the people who *live in them* if this mine were to close down. The Opposition supports the bill. Question resolved in the affirmative. Bill read a second time, and passed through its remaining stages without amendment or debate. {: .page-start } page 2233 {:#debate-29} ### PATENTS BILL 1960 Bill received from the House of Representatives. Standing Orders suspended. Bill (on motion by **Senator Paltridge)** read a first time. {:#subdebate-29-0} #### Second Reading {: #subdebate-29-0-s0 .speaker-JZY} ##### Senator PALTRIDGE:
Minister for Civil Aviation · Western Australia · LP -- I move - >That the bill be now read a second time. The main purpose of this bill is to amend the Patents Act 1952-1955 so as to give effect to recommendations made by the committee that reviewed the first three years working of the Patents Act 1952. The opportunity has also been taken to include amendments which are required in order that Australia may subscribe to the Lisbon Revision of the International Convention for the Protection of Industrial Property, and also to include certain other amendments of a drafting or procedural nature. Probably the most important recommendation made by the committee was that the documents lodged in respect of an application for a patent should not become open to public inspection until after the acceptance of the application. However, after the bill had been introduced in another place various representations were made asking for the withdrawal of the provisions in the bill which would have given effect to this recommendation. At present section 43 of the act provides for certain documents of an application becoming open to public inspection six months after the complete specification of the application has been lodged. It is recognized by all concerned that early publication, as at present provided by section 43, has certain advantages and disadvantages. These were summarized by the Attorney-General as follows: - " The chief advantages of early publication are - {: type="a" start="a"} 0. The applicant's right of protection from infringement dates from publication; and 1. Manufacturers are able to ascertain at an early date whether they are infringing or likely to infringe an invention which is the subject of the application for a patent. On the otherhand, the main disadvantages of early publication are - {: type="a" start="a"} 0. An applicant's right to amend his complete specification is considerably restricted after publication; and 1. Early publication enables competitors of applicants, particularly overseas applicants, to ascertain, at a much earlier date than in overseas countries, inventions in fields in which the applicant is interested." After considering all the oral and written representations that had been made the Government remained of the view that the disadvantages of early publication were such that the provisions for it in the act should not remain in their present form. My colleague the Attorney-General announced a scheme by which it would be possible to secure the advantages of earlier publication while avoiding the disadvantages. Details of this scheme were circulated to interested parties who submitted comments and suggestions in relation to the scheme. However, it was clear from these that the amendments of the act which would be necessary to give effect to the scheme could not be settled in time to be included in the present bill in this session. Consequently, an amendment of the bill, intended as an interim measure, was made and the bill now provides that publication will take place at acceptance of the application or at the expiration of two years from the lodgment of the complete specification whichever is the earlier. This amendment would give effect to the intention behind the Patent Law Review Committee's recommendation for later public cation while avoiding the disadvantages accruing from any worsening in the work position in the Patent Office. The amendment is intended as an interim measure. It is hoped that a further bill will be introduced next? session to give effect to the scheme mentioned above. One of the main recommendations of the Patent Law Review Committee was that the period within which an application for a patent can be accepted by the Commissioner of Patents should be extended. At present, this period is fifteen months from the date on which the examiner's first report on the application is sent to the applicant. In the case of applications lodged from overseas, it has been found that this period is not long enough. The committee accordingly recommended that the period for acceptance should be extended to 21 months from the same date. Proposed new section 54(1.),inclause10, gives effect to this recommendation. I now turn to the classes of persons who may make an application for a patent. These classes are set out in section 34 of the act, but this section, as it now stands, does not permit a person who would be entitled to the benefit of a patent, when granted, to apply in this capacity. Thus, for example, an employer is entitled to the benefit of a patent in respect of an invention made by an employee in the course of employment; however, the employer cannot apply in his own name unless- the right to apply has been formally assigned to him. The committee recommended that these persons should be allowed to apply in their own names, and clause 5 of the bill gives effect to this recommendation-. The Commissioner has power, under section 160 of the act to extend the time set down for the doing of an act where the act has not been done due to an error on the part of the Patent Office, or by reason of circumstances beyond the control of the person concerned. The committee recommended that an error or omission by the applicant should be an additional ground for extending the time for the doing of an act and that provision should be made for persons who are adversely affected by the grantofanextensionoftime.There statement of section160 by clause 28 of the bill gives effect: to these recommendations. Having dealt with the more important of the recommendations of the review committee I now turn to deal with the Lisbon Revision of the International Convention for the Protection of Industrial Property, and the amendments of the Patents Act required to enable Australia to subscribe to this revision. Australia is, at present, a party to the convention as revised in London in 1934. A diplomatic conference, at which Australia was represented, was held in Lisbon in; October,. 1958, to revise this convention. In accordance with the provisions of the convention, before the Lisbon revision, the Patents Act provides that an application made in a convention country can be used as the basis of an Australian application if it is the first application for the invention in a convention country and if the Australian application is made within twelve months of that application. In determining which is the " first application in a Convention country ", all applications including abandoned applications are considered. The Lisbon Revision of the convention requires that if an application in a convention country has been abandoned without becoming open to public inspection, it shall be disregarded in determining which is the " first application ". Clause 24 gives effect to this requirement. Section 108 of the act provides for compulsory licences where a patent is not being adequately worked. The Lisbon Revision of the convention requires that these compulsory licences shall be nonexclusive, and that these licences shall be assignable only in connexion with that part of the enterprise using the licence. Clause. 19 amends section 108 of the act to. give effect to this requirement. Most of the other amendmentseffected by the bill are of a consequential nature or are intended to remedy a drafting or procedural defect in the act which was not previously noticed, or about which doubt has arisen. However, there is one amendment which I should mention. This is the proposed repeal of section176 (2) which provides that the renewal fees in respect of patents granted under the repealed actsshall be as fixed by those acts. It is intended toincrease the renewal fees in respect of patents, including those granted under the repealed acts. Before this can be done section 176,(2.) needs to be repealed, and clause. 29, in re-stating section 176, gives effect to this. Debate(on motion by **Senator McKenna)** adjourned: {: .page-start } page 2235 {:#debate-30} ### SULPHURIC ACID BOUNTY BILL (No. 2) 1960 {:#subdebate-30-0} #### Second Reading Debate resumed from 7th December (vide page 2189), on motion by **Senator Henty** - >That the bill be now read a. second time. {: #subdebate-30-0-s0 .speaker-KPK} ##### Senator KENNELLY:
Victoria **. Mr. President,** sulphuric acid is a vital commodity in the industrial and the economic life of this country. In fact, it is claimed to be more or less the basic chemical in vast numbers of processes used in' the production of an almost endless variety of products some of which, such as superphosphate, are produced in vast quantities. The bill is based on the Tariff Board's report recommending the provision of assistance to the industry. It extends the bounty for a further five years. It provides for the payment of a bounty at the rate of £3 a ton on sulphuric acid. The measure also provides that the rate of profit limitation shall remain unchanged at. 12½ per cent. of the capital employed in the production and sale of the acid, and it limits the payment of the bounty to the producers of materials who were operating on 1st December, 1960. While the Opposition does not oppose the bill,I do not like the idea of this limitation. On the surface, it appears to be relatively easy for any one to undertake the production of sulphuric acid, but in fact it is as hard for one to enter this field as it is to become a member of the Melbourne Slock Exchange. According to the information that has been supplied by the Minister for Customs and Excise **(Senator Henty)** and his department, the firms which are at present engaged in this industry can produce sufficient sulphuric acid to meet the requirements of this nation, but the Australianproduced acid cannot be sold overseas unless its production is heavily subsidized. I suppose that is the reason why a bounty of £3 a ton on sulphuric acid is being paid. I hope that when our economy becomes stable it. will not be necessary so often to seek increases of the rates of bounties as during the last few years. The Opposition agrees to the bill. {: #subdebate-30-0-s1 .speaker-KSS} ##### Senator MATTNER:
South Australia -- I am sure that the passage of this measure and of the Pyrites Bounty Bill 1960, with which we will also deal this afternoon, will have a tremendous effect on the economy of South Australia. It is expected, not without consternation, that the price of superphosphate will rise in South Australia. As **Senator Kennelly** has said, sulphuric acid is of great importance to industry in Australia, particularly to agricultural industries. The low cost of American sulphur has contributed to agricultural economy in Australia. The price and the availability of brimstone have been determining factors in its use-. Because the position in relation to those factors became alarming in 1959, Australia was faced with a shortage of brimstone from which to manufacture superphosphate for its- agricultural industries. In 1950. there was a particularly grave world shortage of sulphur. The price of sulphur was high at that time, and Australia's requirements of the commodity were severely rationed. Faced with this situation, the Government decided to foster and extend the use of indigenous sulphur. I propose to quote from a letter dated 14th January, 1952, written by the Minister for Defence at that time to the chairman of the Australian Sulphuric Acid Committee. The letter stated, in part - >The Commonwealth Government gives a definite assurance to the industry- That is, to the sulphuric acid industry. - that it will be effectively protected whenever necessary against the importation of brimstone at a cost which may render uneconomic the use of indigenous sulphur-bearing material as a source of sulphur dioxide gas. Again, on 27th March, 1952. further assurances were given to the producers of sulphuric acid from indigenous materials that protection would be afforded by means of a flexible provision in the Sulphur Bounty Act, which would permit the bounty to be varied on the advice of the Tariff Board, as circumstances made necessary. As honorable senators will see, there was a grave shortage of brimstone and sulphuric acid, and there were certain assurances by the government of the day. On the strength of those assurances, South Australian manufacturers proceeded to use indigenous materials instead of sulphur for the production of sulphuric acid. To meet the desire of the Government that Australia should be made less dependent on imported brimstone, two companies were formed in South Australia. They were Nairne Pyrites Limited and Sulphuric Acid Limited. The cost of their plants was £1,194,684 and £2,716,000 respectively. Particulars of the costs involved in establishing the plants are available to the Tariff Board, to the South Australian prices authorities, and to the Commonwealth Government. In addition, Broken Hill Associated Smelters Proprietary Limited erected a contact plant at Port Pirie to utilize waste gas from lead concentrates. From that source alone, the company produces 60,000 tons of sulphuric acid a year. I point out, **Mr. President,** that 94 per cent, of all the sulphuric acid that is produced in South Australia is made from indigenous materials, which results in a saving of at least £750,000 for our overseas funds. 1 also point out that plants for the roasting of pyrites are costly. It is safe to say that such a plant costs double the price of a sulphur-burning plant. The Tariff Board has stressed this matter in its 1960 report. T hope that the Minister for Customs and Excise **(Senator Henty)** will bear with me in putting forward these facts on behalf of the South Australian industry. In 1959, the Government decided that it was economically unsound to continue to encourage the production of sulphuric acid from indigenous materials. It requested the Tariff Board to inquire into the advisability of providing a suitable bounty. I may say that the 1958 recommendations of the Tariff Board were not adopted. The latest report of the board on this subject - that for 1960 - has recommended the extension of a bounty for five years, the provision of separate bounties for iron pyrites and sulphuric acid made from pyrites, and that no bounty be paid on acid made by Broken Hill Associated Smelters Proprietary Limited from sinter gas. The board proposed alternative bounty rates of £3 and £5 4s. a ton on sulphuric acid production. The Government elected to choose £3 as a suitable bounty. Those two figures are worth a moment's consideration. The decision to select £3 as an overall basis of bounty payments to the sulphuric acid industry affects South Australia in two important ways. As I have said, 94 per cent, of the sulphuric acid produced in South Australia is made from indigenous materials. The cost of production is relatively high, as was verified by the Tariff Board, but the high cost is not due to inefficient manufacture or management. One of the main factors in it is the high cost of installing plant between 1952 and 1955 to meet the Government's wishes. The high costs which those who have installed new plants have had to meet have placed them at a distinct disadvantage. Whether we view this matter from the defence angle, or solely from the agricultural angle, we must agree with the recommendation of the Tariff Board. The industry in South Australia must receive a bounty of £5 4s. a ton if it is to continue to exist. I know that I shall be told that the bounty of £3 a ton was the average amount recommended. The adoption of the averaging principle will cost South Australia at least £2 4s. a ton. My reply is that a part of this industry was established at the specific request of the Government. It has fulfilled its obligations. Its plant is up to date and its management is good. Its costs have been reduced to the lowest possible level. Having regard to all those factors, and also to the fact that, in order to offset its disabilities, it requires a bounty of £5 4s. a ton, there is no doubt that the South Australian industry is at a disadvantage when compared with industries which are able to keep going on a bounty of only £3 a ton. Let me point out a further disability which will occur in South Australia following the recommendation of the Tariff Board that Broken Hill Associated Smelters Proprietary Limited be disallowed the present bounty of £4 per ton for sulphuric acid. I do not disagree with the suggestion that that company will not suffer; I do not think it will suffer. But the point is that the withdrawal of that bounty from B.H.A.S. must force up the price of acid in South Australia by at least £4 per ton. The price of acid produced by that organization is rigidly controlled by the South Australian Prices Commissioner. We must conclude that the commissioner takes the bounty of £4 per ton into consideration when conducting his- inquiries. I repeat that, in my opinion, the price of this sulphuric acid will rise by £4 per ton when the bounty is removed. Such a rise in the price of sulphuric acid will have an adverse effect on the price of superphosphate in South Australia. As sulphuric acid is used for the manufacture of superphosphate, I believe I am at liberty to link the price of superphosphate with the subject-matter of this bill. In South Australia, Sulphuric Acid Limited supplies 74,500 tons of sulphuric acid and B.H.A.S. supplies 54,000 tons, making a total of 128,000 tons. We can assume that the supplies of Sulphuric Acid Limited will be available at the existing rate. But the withdrawal of the bounty from B.H.A.S. will mean that possibly £216,000 will be added to the cost of sulphuric acid which, as I have said, is used in the manufacture of superphosphate. As the price of superphosphate is strictly controlled in South Australia, the additional £216,000 must be passed on to the users of superphosphate. {: .speaker-KBW} ##### Senator Wright: -- What is the present price of superphosphate there? {: .speaker-KSS} ##### Senator MATTNER: -- It is much higher than in Victoria. Offhand, I cannot give you the exact price of superphosphate 45. It varies somewhat. {: .speaker-KNR} ##### Senator Hannaford: -- It is £13 or £14 per ton. {: .speaker-KSS} ##### Senator MATTNER: -- The withdrawal of the bounty from B.H.A.S. could cost the superphosphate user at least an additional 9s. per ton. So the user of superphosphate in South Australia will suffer two great cost disabilities. The price of sulphuric acid produced by plants which use pyrites is 14s. per ton higher than that produced by plants which not only use brimstone now but which have persistently used it since 1950, in spite of the national appeal to use indigenous materials. The Tariff Board has set out that fact very clearly in its report. I repeat that the effect of this bill will be a further rise of possibly 9s. per ton in the price of superphosphate in South Australia. If we reject the bill, no bounty at all will be paid. I ask the Minister to give favorable consideration to South Australia's position so that some equitable means may be found to rectify the hardship that will be imposed upon the South Australian superphosphate industry by reason of the added cost of at least £216,000. Perhaps that could be done by paying B.H.A.S. a bounty on its acid production, provided the superphosphate industry received the benefit. Let me mention a second way in which it could be done. The Sulphuric Acid Company and Nairne Pyrites Limited erected plants for the production of superphosphate when it was urgently needed. The Government might look at the cost involved in establishing those plants and grant those companies favorable interest rates or, if that is not possible, special amortization rates over the next few years. As I see the situation, the South Australian interests, despite their loyalty to the Government, now face extinction. That is a cold hard fact. My support for the bill is conditioned by the fact that I feel certain the Minister for Customs and Excise, who is in charge of the measure, will bring the disability suffered by South Australia to the notice of the Government and that the Government will give well-deserved relief to that State. {: #subdebate-30-0-s2 .speaker-KOW} ##### Senator HENTY:
Minister for Customs and Excise · Tasmania · LP -- in reply - I point out to **Senator Kennelly** that the restriction is not quite as he envisages it. The purpose of this bounty was to honour the Government's undertakings to those who set up pyrites plants. No new people will be brought into this field, because the Government does not now wish to encourage the use of pyrites or indigenous materials in the manufacture of sulphuric acid. I repeat that the Government is honouring its undertaking to those who are in the field but that it is certainly not encouraging new operators to come in. That is the reason for the restriction. I listened to the comments of **Senator Mattner.** I shall convey his remarks to the Minister for Trade **(Mr. McEwen).** As a matter of fact, I have already discussed the matter with my colleague. becauseithascometomynoticeasMinisterforCustomsandExcise.Iamcon fidentthat,iftheSouthAustralianspresent a documented case to the Minister for Trade, he will carefully consider the position in that State. The Government has adopted the Tariff Board's recommendation of £3 per ton, that being the average. Wecannotpayonerateofbountytoone Stateandanotherrateofbountytoanother State. {: .speaker-KAF} ##### Senator WADE:
VICTORIA · CP -You cannot subsidize the inefficient States, can you? {: .speaker-KOW} ##### Senator HENTY: -I do not think I could accept that statement. To act constitutionally, you must have a uniform rate of bounty. The Tariff Board recommended the rate of £3 per ton, that being the averagecost,disability in Australia. The Government has accepted that recommendation. The board went further and said that, having examined the proposition submitted by Broken Hill Associated Smelters Proprietary Limited, which was producing sulphuric acid from sinter gas, itwasoftheopinionthatitsufferedno cost disability. As a matter of fact, the costwaslessthanifthecompanywere using brimstone. Therefore, the board could not recommend that payment of the bountyforthecompanyshouldbecontinued.TheGovernmenthasleftthisproduct as a bountiable product. If it can be proved later that there is a cost disadvantage in comparison with brimstone, it will attract a bounty. The bounty is not entirely wiped out. **Senator Mattner** has mentionedtheinterestingpointthatthe Prices Commissioner in South Australia writes down the price because -there is a bounty. {: .speaker-KSS} ##### Senator Mattner: -Thatisinfaceright. {: .speaker-KOW} ##### Senator HENTY: -Itmaybe,butitis interesting that the payment of a bounty is taken into account in fixing the price of a commodity. That is something we shall havetoexamine.Ithinkthatitopensup possibilities. **Senator Wright.** Wouldnotthepayment of a bounty be to ensure a reduced price to the consumer? {: .speaker-KOW} ##### Senator HENTY: -Yes.Thereisa profit limitation. {: .speaker-KNR} ##### Senator Hannaford: -Theyhavekeptthe profit down. {: .speaker-KOW} ##### Senator HENTY: -Itmaybethatifthe normalpricewereallowedtobecharged inSouthAustralia,nobountywouldbe payable.Thepointmaybeinteresting. It is something that we can think about. I assureSouth Australian senators that the whole of this matter has been before the Minister for Trade and if a documented case is forthcoming it will be given consideration. Question resolved in the affirmative. Billreadasecondtime,andpassed throughitsremainingstageswithamendment or debate. {: .page-start } page 2238 {:#debate-31} ### PRINTING COMMITTEE {: #debate-31-s0 .speaker-K3O} ##### Senator BUTTFIELD: -Ibringupthe sixthreportofthePrintingCommittee. Report-byleave-adopted. {: .page-start } page 2238 {:#debate-32} ### PYRITES BOUNTY BILL 1960 SecondReading. Debate resumed from 7th December (vide page 2189), on motion by **-Senator Henty-** >Thatthebillbenowreadasecondtime. {: #debate-32-s0 .speaker-KPK} ##### Senator KENNELLY:
Victoria . -ThisbillisonallfourswiththeSulphuric AcidBountyBill.Itdealswithanextra bounty on pyrites. This country is fortunate in having a great quantity of pyrites. ThemainsourcesareMountLyellinTasmania and Mount Morgan in Queensland. However, we have very little brimstone. Our great friend, the United States has, in additiontomanyotherthings,atremendous amount of brimstone in Louisiana and elsewhere. I understand that when this is shipped to Australia it is about 98 or 99 per cent. sulphur. It is landed here at a cost of £21 a ton. Australian commercial pyrites deposits contain about 50 per cent. of sulphur, a commodity which is essential for the production of superphosphate, and heavy costs are incurred in transporting the pyrites to places where the manufacture of superphosphate takes place. Equipment for converting pyrites into sulphur requires considerably more capital and maintenance than is the case with brimstone. The storages and disposal of the residue left after the sulphur has been extracted, involves tremendous cost. The bill is based on the report and recommendations of the Tariff Board and contains proposals similar to those of other bounty bills that the Senate has passed. TheGovernment has seen fit to restrict the payment of bounty to firms that were operating priorto the introduction of thebounty {: .speaker-KOW} ##### Senator Henty: -- I dealt with that. {: .speaker-KPK} ##### Senator KENNELLY: -- Iheard the Minister do so. I was out of the chamber for a moment, butI was able tohear what was said. Although the cost factor is very important, we would be placed in a much more awkward position in relation to our overseas balances if we had to import this commodity. This bounty leads to the provision of more employment. While our present employment position is very satisfactory, immigrants who are coming to help us build this country will find jobs more readily because of this measure and will not be kept as long in holding camps as they are kept now, although I am not implying that they are now kept a long time. The Opposition supports the bill, which will help to keep country towns in existence. Without the payment of bounties on copper and pyrites, companies that have been in production for many years might cease production. {: #debate-32-s1 .speaker-K0L} ##### Senator PEARSON:
South Australia -- I agree with the remarks that have been passed by **Senator Kennelly** and **Senator Mattner** on this and similar legislation. I agree with all the arguments that have been advanced during this debate and, -rather hesitantly, I support the bill. In my opinion the Government has somewhat let down the pyrites industry by adopting the minimum rate of bounty recommended by the TariffBoard instead of a rate approaching the maximum rate. The Tariff Board recommended that a minimum bounty of £3 a ton and a maximum bounty of £7 a ton should be paid to the industry. The industry did a great deal for this country in complying with the Government's request in the difficult days of 1950-51. The Government has decided to adopt the minimum suggested bounty of £3 a ton, which will be insufficient to meet the needs of the industry. South Australianparliamentarians have met representatives of the industryhere inCanberra and we have been left in no doubt that theindustry cannotcontinue to operate satisfactorily if onlythe minimum bounty of £3 a ton is paid. It cannot be said that the Government has necessarily acted wrongly, because the Tariff Board recommended a bounty of between £3 and £7, according to the way in which the Government viewed its obligations to the -industry. The Government, having decided that it had very little obligation to the industry,has introduced a bounty of £3 a ton. In my opinion the Government couldhave acted more generously towards the industry and I register my protest at the insufficiency of this bounty. The Minister for Trade **(Mr. McEwen)** yesterday promised South Australian members of Parliament that if the industry supplies facts and figures in support of its case,he will further investigate its claims. My support to-day for this bill is conditional on that undertaking being honoured. Ihave no doubt that it will be honoured,because I know that **Mr. McEwen** is a man of his word. I know that he will make investigations into this industry. I accept his assurance and on that basis I supportthe bill. Question resolved in the affirmative. Bill read a second time, and passed through its remaining stages without amendment or debate. {: .page-start } page 2239 {:#debate-33} ### ASSENT TO BILLS Assent to the following bills reported: - >Explosives Bill1960. > >Seamen's Compensation Bill 1960. > >Defence Forces Special Retirement Benefits Bill 1960. > >National Library Bill 1960. {: .page-start } page 2239 {:#debate-34} ### BILLS RETURNED FROM THE HOUSE OF REPRESENTATIVES The following bills were returned from the House of Representatives without amendment: - >Customs Bill(No. 2)1960. > >International Organizations (Privileges and Immunities)Bill 1960. {: .page-start } page 2239 {:#debate-35} ### INCOME TAX AND SOCIAL SERVICES CONTRIBUTION ASSESSMENT BILL (No. 3) 1960 Bill received from the House of Representatives. Standing Orders suspended. Bill (on motion by SenatorPaltridge) read afirsttime. {:#subdebate-35-0} #### Second Reading {: #subdebate-35-0-s0 .speaker-JZY} ##### Senator PALTRIDGE:
Minister for Civil Aviation · Western Australia · LP -- I move - That the bill be now read a second time. This bill seeks to give effect, by way of amendments to the Income Tax Assessment Act, to two of the proposals referred to in my statement of 15th November on economic measures. These proposals relate respectively to the treatment for income tax purposes of interest on borrowings in general by certain classes of companies, and to interest on convertible notes. In my statement I outlined why the Government had decided upon these measures. I pointed out how the bidding of higher and higher rates of interest for borrowed money had been working to the disadvantage of governments and other public authorities and, through them, to the disadvantage of the general taxpayer. This was because the less governments could borrow on reasonable terms the more they had to obtain in taxes to finance basic developmental works and the provision of community services. I also went on to say that the bidding-up of interest rates imposed a burden on productive enterprises and added to costs generally. Industry, in general, seeks to raise finance as cheaply as it can, especially when it wants the money for long-term investment and when it has to engage in strenuous competition to sell its products either on local markets or overseas. But in recent years there has grown up a class of borrowers who are not too much inhibited by those considerations. They have found opportunities for using money on a large scale in various fields of activity. The largest field so far has been hirepurchase finance and various other forms of consumer credit; but there are others which have rapidly grown in importance. Some of these borrowers are engaged in lending to small businesses, or to other people who need money for some purpose but who do not have access to ordinary sources of funds. Others are taking part in speculative real estate operations or in speculative building and similar activities where they expect a quick turnover of their funds and early and rich profits. When I speak of specula tive real estate in building activity, I want to make it clear that the Government does not regard all such activity as speculative. Indeed, it recognizes that most building activity and development is highly desirable and serves a vitally important economic function and community purpose. On the other hand, some of it is undoubtedly speculative. Irrespective of the element of speculation, the overall demands now being made on the building industry are considered to be excessive and to warrant reduction to a lower level. But it is the more speculative activity that I am referring to at the moment. Because some borrowers can find soft marks for lending money at high rates, and because they can make quick and easy profits on turnover, they are prepared to bid aggressively for the money which is their principal stock in trade. They are prepared to outbid other borrowers, public and private alike, who have to keep a more careful watch on costs and who are not in a position to pass higher interest charges on. This unrestrained competition for capital is not good for the economy, either in the short term or the long. It leads, as I have said, to a forcing up of interest costs both on industry and on governments. It causes taxation to be higher than it need be. It leads also to a diversion of resources away from the sounder and more enduring forms of production and commerce into speculative and even predatory forms of activity. There can be no question but that such activities have contributed much to the prevailing boom. {: .speaker-KBW} ##### Senator Wright: -- What have you in mind as the " predatory forms "? {: .speaker-JZY} ##### Senator PALTRIDGE: -- I will probably discuss that a little later. This readiness on the part of some organizations to borrow large sums at relatively high rates and to outdistance other borrowers in the prices they offer for money, has undoubtedly been encouraged by the fact that, under the income tax law as it stands, interest paid on borrowings for purposes of a business is regarded as an expense of earning income and as such is deductible in full when taxable income is computed. The saving in net cost of borrowing which this provision allows is quite substantial, and it becomes more marked the higher the rates paid for money. As I pointed out in my statement to the Senate, with the general rate of company tax at 8s. in the £1 the net interest cost of an 8 per cent, loan is only 4.8 per cent. The net cost of a 10 per cent, loan would be only 6 per cent.; and so on. To allow deductions of interest as a business expense has been a long-standing practice in taxation. We would have had no thought of disturbing it had it not so clearly been contributing to the harmful developments of which I have spoken, and had we had access to effective alternative measures. We have had the matter under consideration for some time and have reached the view that, in the interests of the public finances, of the general taxpayer and of the great majority of enterprises in industry and commerce, some modification in the practice ought to be made. It is no easy matter to devise amendments to the law which would meet the general objectives we have in view and at the same time be capable of practical administration. We have given a great deal of thought to the subject and .have carried investigations to some length. The task has not been made easier by our inability up till now to seek information outside governmental circles or to consult, as widely as we would have wished, authorities in the world of business at large. But the policy having been announced, we are free to do that now. Whatever may be our decisions about the form a more permanent scheme should take, it has seemed to us necessary in the meantime to take some form of holding action - and this for special reasons. As part of our general plan of action for relaxing some of the pressures on the economy, we are convinced that there must be a sharp reduction in the flow of funds to certain forms of investment, and especially in the funds which are being channelled through the so-called fringe institutions into consumer credit, real estate promotions and the less useful types of financing operations generally. Several of our measures are directed to that end. It is a particular aim, for example, of the selective restriction of bank advances which has been requested by the Reserve Bank of Australia, and it is also one of the main purposes for which trading bank interest rates, and especially deposit rates, have been raised. But, as pointed out in my general statement, the effects of these forms of action could be largely, if not wholly, nullified if the institutions whose access to funds we are trying to limit were left in a position to bid up rates of interest as freely as they have done in the past. We have therefore decided to bring down an interim measure and it is that which this legislation embodies. Its main purpose is to put an immediate curb on the kind of competition for money we are endeavouring to subdue during the period while a continuing scheme is drawn up and presented to Parliament. We intend to bring such a scheme forward as soon as we possibly can. In saying that, I would like it to be realized that the difficulties are quite formidable. Nevertheless we are conscious of the need to push the matter forward with all possible despatch. Naturally, some honorable senators would like me to say as much as I can about the general nature of the continuing scheme we have in view. At the same time, they will appreciate that the Government cannot commit itself on points of detail which may yet require a lot of further investigation. In my earlier comments I have given some indication of the general purposes the Government has in view. Perhaps I may re-emphasize here two points. One is that it should not be assumed that the continuing scheme will bear any close similarity to the interim scheme now being introduced. The second is that our broad aim will be to reduce as far as possible the advantages which deductibility of interest provides for companies which seek to borrow excessive amounts of money at excessive rates of interest - the accent here being very much on the term " excessive ". This is something which those now tempted to follow either course should carefully ponder. I expect also that, like the interim scheme now before the Senate, it will be confined to interest on borrowings by companies. We have provided this in the interim scheme because, as a general rule, the largest and most aggressive borrowers are not found amongst individuals and organizations other than companies. There are, no doubt, a few exceptions and others could arise, but probably not on a sufficient scale to warrant extension of the scheme beyond the range of company borrowings. I shall take up now some other features of the interim scheme. It provides that interest on borrowings by or from certain classes of companies shall remain fully deductible. These companies include banks, pastoral finance companies, approved short-term money market dealers, certain classes of building or co-operative housing societies and companies engaged in the utility services of supplying gas, electricity and water. Interest on loans from governments or public authorities or guaranteed by such bodies will also continue to be fully deductible.. The. chief reason for making these exceptions is that in most, if not all, cases, coming within the defined categories, rates of interest are subject to some degree of official control or supervision. We have also wished to ensure that the scheme does not act in any way retrospectively, and that is the reason for a special provision in the bill which gives companies an option as to the basis for calculating the amount of interest for which they may seek deductions in the income year 1960-61. They may deduct up to the amount of interest for which they were liable in the income year 1959-60, or alternatively, elect to deduct the amount of the annual interest liability as at 15th November last, which was of course the date on which the proposal was announced. Besides this, the bill covers the position of companies which had at 15th November entered into firm commitments to borrow particular sums of money or had actually invited applications for the loan of particular amounts of money. We have taken account of the position of small companies or' companies coming' on the market, some perhaps for the first time, for modest amounts of loan money. These cases should, we think, be reasonably met by the provision that full deductibility will be allowed for amounts of interest up. to. £10,000. We have, however, included safeguards against the inappropriate use of this provision. It has seemed reasonable, too, to make some concession for cases where companies which, in the preceding income period, were relying to some extent on bank finance but have since had to replace that bank finance wholly or in part by borrowings from other sources. The bill provides in effect that, for purposes of assessing the deductible amount, interest payable by a company in 1959-60 and 1960-61, or the substituted periods, shall not be taken to includebank interest in either period. When, however, bank interest in the second period is less than in the first, the amount of other interest payments eligible for deduction in the second period will be increased to that extent. These are the main features of the bill to which I need call attention at this stage so far as it relates to deductibility of interest in general. The bill also deals with our proposal to disallow henceforth interest on convertible notes: Unlike the interim scheme on de- ductibility in general, which has application only to income tax assessed in respect of 1960-61, the provisions relating to convertible notes: are intended) to have effect indefinitely: I would first mention that the provision will not apply to interest on notes issued on or before 15th November,1960. Nor will it apply to interest on notes issued alter that date: if the terms of issue were announced by the company before that date, or the company was, at that date bound by agreement to issue the notes. The purpose of the new provision is to ensure that deductions are not allowed for amounts: raised by a company as borrowings but which arereally designed to be a permanent investment in the company and ultimately converted into share capital. There has recently been a strong trend for companies to issue convertible notes in lieu of shares, and by this means they have been obtaining a deduction for interest paid on the notes. If, however, they had issued share capital, any dividends paid on that share capital would not have been allowed as a deduction in arriving at their taxable income. The notes have in substance more in common with the permanent capital of the company than they have with either short-term or long-term borrowings. The holders of the notes are, very often if not invariably, given rights corresponding very closely with those of shareholders. It is in these circumstances that the Government has decided that in arriving at the taxable incomes of companies that issue con vertible notes in the future, the interest on the notes will not be deductible. A memorandum explaining each of the clauses of the bill: will be made available to honorable senators and in these circumstances I do not propose, at this stage, to discuss in detail the technical aspects of the bill which I now commend to the Senate. Debate (on motion by **Senator McKenna)** adjourned. Sitting suspended from 5.48 to 8 p.m. LOAN (QANTAS EMPIRE AIRWAYS LIMITED) BILL 1960. Message received from the House of Representatives intimating that it had agreed to the amendment made by the Senate in this bill. PATENTS BILL 1960. Second Reading. Debate resumed (vide page 2235). {: #subdebate-35-0-s1 .speaker-KTN} ##### Senator McKENNA:
Leader of the Opposition · Tasmania .- The bill before the chamber is of historic interest for all senators, I think, because I understand it is the last bill that **Senator Sir Walter** Cooper will introduce in the Parliament from the ministerial bench. I think for that reason that comment should be made. Speaking from a personal viewpoint, I am delighted to figure with the honorable senator in the last measure that he introduces in his ministerial capacity. I shall store it among my pleasant recollections, and I am happy that it is a measure that provokes no real controversy. The bill has two main purposes, as the Minister indicated in his second-reading speech. I shall not traverse the various descriptions he has given to the clauses. All I need say is that the bill gives effect to recommendations of an expert committee that was appointed after the act was amended and consolidated in 1952 to observe its working. It also gives effect to the Lisbon Convention.. We accept the recommendations implemented by the new provisions. We have no hesitation in accepting the recommendations of the Lisbon conference. We have only one objection. It goes to the matterthat has been the subject- of public controversy, concerning the time at which- a specification ought to be published. There are conflicting interests in that matter. On the one side are the manufacturers, who are very keen that the specification shall be published at the earliest moment, and on the other side there arethe overseas interests who want to establish patent rights in this country, and inventors themselves. They are the conflicting interests in the field. . The mind of the Opposition is rather inclined1 to be on the side of the manufacturers in Australia, so that they may know at the earliest moment the improvements that they might be able to adopt and apply in their own factories and undertakings and avoid the possibility of breaching a patent. Broadly, we shall not oppose the motion for the second reading, but in committee I shall, on behalf of the Opposition, move an amendment designed to hold the present positron, which provides for publication of a patent application and specification earlier than the bill intends. I shall reserve what I have to say on that subject until we are in committee. {: #subdebate-35-0-s2 .speaker-K6W} ##### Senator COLE:
Leader of the Australian Democratic Labour Party · Tasmania -- I should like to second **Senator McKenna's** remarks in reference to **Senator Sir Walter** Cooper, who is retiring from the Ministry. Unfortunately, I was absent from the chamber recently when notification of his retirement as a Minister of the Crown was given. I want to pay a tribute to **Senator Sir Walter** Cooper for the wonderful way in which he has administered his portfolio and for the kindness and consideration that he has shown to all people who have brought cases to him. I convey to him also the thanks of recipients of repatriation benefits for what he has- done in this field. The job of Minister for Repatriation has always been a suicidal one, politically, in this Parliament. Of relatively recent times, **Senator Sir Walter** Cooper is the only occupant of that post who has decided to retire from it; his predecessors have been retired from the portfolio. **Mr. President,** on behalf of my party I want to thank **Senator Sir Walter** Cooper for the consideration he has given to cases that we have placed before him. I am sure there has never been a kindlier man than he is in charge of the administration of the Repatriation Department. Because of these nice things that I have said about the Minister, I will not oppose the bill or even vote for **Senator McKenna's** amendment at the committee stage. Question resolved in the affirmative. Bill read a second time. In committee: The bill. Clause 7. Sections forty-two and forty-three of the Principal Act are repealed and the following section is inserted in their stead: - "42. Where- {: type="a" start="a"} 0. an application was accompanied by a specification purporting to be a complete specification; and 1. the applicant, within twelve months after the date of the application and before the application and the complete specification have been accepted, requests the Commissioner to treat the specification as a provisional specification, the Commissioner may direct that the specification be treated as a provisional specification and, in that case, the specification shall, for the purposes of this Act, be deemed to be, and at all times to have been, a provisional specification.". {: #subdebate-35-0-s3 .speaker-KTN} ##### Senator McKENNA:
Leader of the Opposition · Tasmania -- I move - >Clause 7, leave out " Sections forty-two and forty-three of the Principal Act are repealed and the following section is inserted in their stead ", insert " Section forty-two of the Principal Act is repealed and the following section is inserted in its stead ". The effect of the amendment is that, instead of the repeal of sections 42 and 43 of the principal act and the insertion of a new section 42, as the bill proposes, only section 42 will be repealed and the new section inserted in its stead. The Opposition objects to the repeal of section 42 of the existing act. I shall very briefly put the position as I understand it. Under section 41 of the act, a complete specification has to be filed within twelve months from the time an application or a patent is lodged, otherwise it lapses. Under existing section 43 - that is, the section that the bill proposes to repeal and which the Opposition considers should stand - it is provided that at the expiration of six months after the complete specification is filed, the com missioner gives public notification that the specification is open to public inspection. In all, that would occupy a period of something like eighteen months. Under proposed new section 52 (4.) (a), set out in clause 10 of the bill, it is provided that on acceptance of the application and the complete specification the documents are to be opened to public inspection. Proposed new section 54 provides that the application and the complete specification may be accepted - originally it was provided that they may be accepted within 21 months, and that provision is retained - 21 months from the date on which the first report of the examiner in the Patent Office is sent to the applicant. So in all, counting from the time that the application is lodged, there is a year in which to lodge the specification and then a further two years may elapse before the document is available for publication. In all, the period could extend to three years. The Opposition considers that that is altogether too long. The Government has not made up its mind finally on this provision of the bill. It has announced that this is an interim measure for the purpose of holding the position while it considers the matter further. It is expected that a new bill, incorporating the Government's final determination in the matter, will be available early in the New Year. The Opposition does not see the wisdom of extending the period before the Government has made up its mind. We on this side think that the existing provision should be left alone. I understand that that is also the wish of the manufacturers of Australia. If section 43 is retained, the provision will read - >At the expiration of six months if a complete specification has been lodged, the Commissioner shall publish in the " Official Journal " a notification that the complete specification is open to public inspection and, upon publication of the notification, the application, complete specification and provisional specification (if any) shall, subject to this Act, be open to public inspection. In other words, we seek to maintain the existing position that withholds publication for a period of approximately eighteen months at the most. It is a very clear issue. We think that it is unwise to alter the existing situation, since the Government does not intend that the elongated period shall stand in its present form for any length of time. {: #subdebate-35-0-s4 .speaker-JQP} ##### Senator Sir WALTER COOPER:
Minister for Repatriation · Queensland · CP [8.12]. - First, I wish to think the Leader of the Opposition **(Senator McKenna)** and the Leader of the Australian Democratic Labour Party **(Senator Cole)** for their very kind remarks. I was not aware, until the Leader of the Opposition mentioned the matter, that this is the last bill of which 1 shall be in charge. I now realize that I am practically out of the Ministry. Since the bill does not seem to be a very contentious one, and as it was originally introduced by the AttorneyGeneral **(Sir Garfield Barwick),** perhaps honorable senators will assist me in giving it a smooth passage through the Senate. As **Senator McKenna** has said, this is an interim measure. The two-year period has been selected as a trial period, because the various organizations concerned - not only the manufacturers - have not been able to agree amongst themselves as to what the actual period should be. I therefore ask the Opposition to accept the bill as it is until it has been decided to fix the period definitely one way or the other. {: .speaker-KTN} ##### Senator McKenna: -- The Minister has given a delightful exhibition of his capacity to say " No " very pleasantly. I want to say to him, through you, **Mr. Chairman,** that it has been a pleasure to do business with him. Amendment negatived. Bill agreed to. Bill reported without amendment; report adopted. Bill read a third time. {: .page-start } page 2245 {:#debate-36} ### INCOME TAX AND SOCIAL SERVICES CONTRIBUTION ASSESSMENT BILL (No. 3) 1960 {:#subdebate-36-0} #### Second Reading Debate resumed (vide page 2243). {: #subdebate-36-0-s0 .speaker-KTN} ##### Senator McKENNA:
Leader of the Opposition · Tasmania -- As 1 listened to the Minister for Civil Aviation **(Senator Paltridge)** delivering his second-reading speech, which I have no doubt was prepared for him by the Treasurer **(Mr. Harold Holt),** I thought that" I was listening to an Opposition member criticizing the Government. Perhaps I could be pardoned for being sur prised that it really was the voice of the Treasurer, speaking through the Minister for Civil Aviation and indulging in what we have come to know as the Communist technique of public self-criticism. Self-criticism is certainly good for the soul, particularly if the criticism is accurate and well justified. I find that the preliminary passages of the speed amounted to almost as severe, a condemnation of the Government's performance in the economic field as I could have made myself. Let me direct attention to some extracts from the Minister's speech. For instance, he said - >I pointed out how the bidding of higher and higher rates of interest for borrowed money had been working to the disadvantage of governments and other public authorities and, through them, to the disadvantage of the general taxpayer. This was because the less governments could borrow on reasonable terms the more they had to obtain in taxes to finance basic developmental works and the provision of community services. How many times have I said that, year after year! I have blamed the failure of the loan market on high interest rates. On behalf of the Opposition, I have adverted regularly to the theme of the terrific burden of taxation that the failure of the loan market has cast upon the taxpayers of to-day. During the last eleven years, while this Government has been in office, some £2,000,000,000 of revenue has been applied to the developmental works mentioned by the Minister. So, what the Treasurer has said in another place, and what the Minister for Civil Aviation said in this place, confirms what I have been saying on behalf of the Opposition over the years. Accordingly, I appreciate the authenticity of that piece of self-criticism. The Minister went on to say - {: type="i" start="1"} 0. . the bidding-up of interest rates imposed a burden on productive enterprises and added to costs generally. Those are the words of the Treasurer, not a member of the Opposition, after eleven years of administration by this Government. That is the kind of statement that the Opposition has been making consistently in recent years. The Minister also said - >But in recent years there has grown up a class of borrowers who are not too much inhibited by those considerations. That is, the need to keep costs down - >They have found opportunities for using money on a large scale in various fields of activity. The largest field so far has been hire-purchase finance and various .other forms of consumer credit. . . . What the Government must recognize is that -it is entirely to blame for that development, lt was the Government's repeal of section 28 of the Banking Act back in 195-3 which opened the door for the banks to escape from the control of the Reserve Bank and to enter into the fringe institutions which now form part -of the Treasurer's jargon. That meant, -of course, a reduction of the area of banking over which the Reserve Bank could exercise control. The Government must accept a great deal of blame for the fact that it has not sought to exercise the powers that lie to its hand. In the view I take and which the Opposition generally takes, the banking power could extend to hire-purchase companies, which take deposits and make loans. It could extend to finance companies of that kind, and many of them in fact acknowledge that. I understand that quite a number of -them have applied to the Treasurer for exemption from the operation of the Banking Act, and I know that exemptions were given by the previous Treasurer. I do not know how many exemptions the present Treasurer has given during his administration .of the Treasury portfolio. Quite apart from that, there was the possibility that the Government might have exploited the other great constitutional power - power over foreign trading and financial corporations formed within Australia. That is one head of power that the Government has never attempted to exploit. It is almost completely unexplored by judicial decision, except to impose a limitation in any matter relating to the formation of a corporation in the Commonwealth. So the Treasurer has not been bereft of powers, as he presently claims. One might have expected him, in the desperate situation that has developed under his hand, to explore to the limit every constitutional power that may even have appeared to be available to him. But he has not done that. The Minister for Civil Aviation said further - >Others are taking part in speculative real estate operations or in speculative building and similar activities where they expect a quick turnover -of their funds and early and rich profits. There is nobody to blame for that situation but the 'Government itself. Further on in his speech, the Minister made this extraordinary statement - >Because some borrowers can find " soft marks " for lending money at high rates, and because they can make quick and easy profits on turnover, they are prepared to bid aggressively for the money which is their principal stock in trade. That tendency has been apparent for many years. It is not one which has developed in the last few months. It is the kind of thing about which the Opposition has been complaining over many recent years. The Treasurer's outlook is summarized in this paragraph - >This unrestrained competition for capital is not good for the economy, either in the short term or in the long. It leads, as I have said, to a forcing up .of interest costs both on industry and on governments. It causes taxation to be higher than it need be. It leads also to a diversion of resources away from the sounder and more enduring forms of production and commerce into speculative and even predatory forms of activity. That sounds much more like bitter criticism by an Opposition speaker than an announcement by the Treasurer of the state of affairs of this country. {: .speaker-KBW} ##### Senator Wright: -- Will you say that again? {: .speaker-KTN} ##### Senator McKENNA: -- It sounds more like a bitter speech by an Opposition senator than a statement from the Treasurer announcing the state of the country. The honorable senator imposed a test on my memory. I hope I succeeded in repeating, what I said. {: .speaker-JZY} ##### Senator Paltridge: -- I think you did, but your contention is wrong. {: .speaker-KTN} ##### Senator McKENNA: -- If I have contributed to **Senator Wright's** mirth, I anr delighted. {: .speaker-KBW} ##### Senator Wright: -- A significant sentenceuttered in this place always arouses my enjoyment. {: .speaker-KTN} ##### Senator McKENNA: -- The Minister'swhole speech is the best argument I havelistened to for a long time in support of a properly planned economy. A properly planned economy is the theme which runs, right through this speech. Presently, I hope to indicate the various instruments, and methods, rather covered and -hidden, indirect and inefficient, which the Government seeks to apply to the present economic: situation. A couple more paragraphs of the Minister's speech are worthy of: comment. The Minister said - >As I pointed out in my statement to the- Senate, with the general rate of company tax at 8s. in the: £1, the net interest cost of an 8 per cent, loan is 4.8 per cent. The net cost of a 10 per cent, loan would be only 6 per cent.; and so on. {: .speaker-KBW} ##### Senator Wright: -- Does that imply that company tax at the rate of 8s. in the £1 is a cost? {: .speaker-KTN} ##### Senator McKENNA: -- In this context, it certainly is an element in relation to which the company is able to benefit. {: .speaker-KBW} ##### Senator Wright: -- Is that, statement a direct implication that the tax is a cost? {: .speaker-KTN} ##### Senator McKENNA: -- I would not argue against the proposition that income tax is a: cost in the eyes of the company. I am not concerned about costs for the purpose of the argument I am advancing now. I am merely pointing out that the Treasurer, through the Minister for Civil Aviation, makes that announcement as though he has made a recent discovery. I can recall stating that very position in this place some years ago and pointing out exactly what the effect was. I find a lot of consolation in some of these comments, which justify the stand the Opposition has taken over quite a few years. Coming to the new proposal to disallow certain interest which companies claim as a deduction in determining assessable income, the Minister said - {: type="i" start="1"} 0. . we would have no thought of disturbing it had it not so clearly been contributing to the harmful developments of which I have spoken, and had we had access to effective alternative measures. By and large, all that has been said is as strong an intimation of the state of the economy as the Opposition itself could put forward. I ask the Senate: Where is the prosperity that until the last couple of months the Government was so continually prating about? I repeat that the Government itself is to blame for very much of the present state of affairs. It opened the door to the banks to escape from the control of the Reserve Bank,, and it is not using, or at least is not trying to exploit, the powers that lie to its hand. If the exercise of those powers was not sustained by the High Court, it could go to- the- people- and point out that there could not be effective guidance of the economy, without additional powers being given, to the Commonwealth Parliament. The Government itself forced up interest rates, on bonds. It joined with the Reserve Bank in the policy of not supporting the loan market, of issuing bonds at higher rates, and of depreciating the capital value on the market of all prior bonds. It destroyed confidence in the loan market. When the Government complains about a depressed loan market and it has regard to the state of inflation that it has let run and which it has encouraged', particularly in its early years of office, and to the effect that its increase of interest rates has had upon the loan market, it finds that the chickens are coming home to roost in large numbers. Under the emergency measures that we heard about for the first time on 15th November, the Government is using bank control in a limited field of the provision of credit - a marginal field of about 21 per cent. - as a hidden and very ineffective form- of import licensing and capital issues control. The control is hidden, it is ineffective, and it operates only in an exceedingly small field. {: .speaker-KNR} ##### Senator Hannaford: -- Will not this action increase the percentage of banking control? {: .speaker-KTN} ##### Senator McKENNA: -- I would not pronounce a final judgment on that proposition in answer to a question at such short notice. I would like to think about it. This action should result in a reluctance of borrowers to borow further. The action now proposed should have the effect of forcing interest rates down, because there will not be such keen competition for money. It may well be that the ambit of the banks will be increased as a result of this action. I think I would affirm that proposition at firstthought. {: .speaker-KNR} ##### Senator Hannaford: -- And the increase in the bank rate, too, would have some bearing on it. {: .speaker-KTN} ##### Senator McKENNA: -- Increased bankdeposit rates would undoubtedly have some hearing; but there is a long way to go before the scope of the bank as a provider: of credit reaches the pre-war level. In thosedays, the banks provided, I think, 56 per cent. o£ the total, credit,, but in 1958 they were- providing only- 21 per cent.. If the.- measure does have the effect that the honorable senator suggests, I hope it will mean a substantial increase in legitimate banking, taking the function away from the fringe institutions, bringing it under the control of the Reserve Bank and so under the control of this Parliament. If those are the results of the legislation, they will have my approval. I think that the legislation will have effects on excessive borrowing and that it will tend to reduce interest rates, but one of the great defects of what is being done is that it is not the general application of a control. It is not a general approach to the question of lower interest rates. The sales tax increase was an instance of a sectional tax directed at one industry that was, we were told, making an undue demand on labour and resources. It seemed to me that the fairest thing to do in that situation was to spread restrictions over general fields - to have a sort of rationing of resources, instead of throwing the whole burden upon one industry. Under this legislation, the burden is cast upon companies only. Firms and individuals are not caught up, and certain companies are deliberately left out of the field. Again one must face the fact that it is sectional. The Senate will appreciate that I have had only a limited time to give attention to this highly technical, complicated bill. I notice that snares have been set for those who seek to find a way out of this legislation, but on a very rapid look it seems to me that there are still ways of escape for the ingenious. Moneys can still be lent by companies at high rates of interest to firms, which may then lend the moneys at still higher rates of interest. The door is still open to that. They may be able to charge very high rates of interest in a lucrative form of business, even a speculative form of business attracting the high profits that the Treasurer talks about. That may still be done. If the Minister speaks presently, I should like to know from him whether that possibility has been guarded against. I regret that I have not had time to read the memorandum that the Commissioner of Taxation, with his usual courtesy and efficiency, has placed before the Parliament. I should like to know whether that type of gap has been covered. Apart from that, here again we have an inefficient, sectional approach to the problem, dealing with companies only. There may be major activities on the part of individuals which will not be touched in any way by what we are doing. Here is the taxation power being used to achieve the economic purposes of the Government. A blunt, inefficient and sometimes unfair instrument is being used to achieve a particular result. I cannot see this scheme working quite fairly as between company and company. One company may, in the base period - 1959-60 or the year ended 15th November, 1961 - have had a very high degree of borrowing. It is perfectly certain that while this remains the law, that company will not be anxious to pay off the loans. If it does, it will rush to build up its loans again to the level that will allow it to deduct the full amount of interest. On the other hand, a company may have discharged a very heavy loan programme in anticipation of going in for an expansion programme and raising more money. It may have plenty of assets and good securities. It is caught in the interregnum between two periods of developmental activity. In that situation, the legislation could work most harshly. I ask the Minister how that position could be rectified as between company and company. Is there any provision for adjustments of equity, or have we again an arbitrary rule that might be a good thing for one company and a harsh thing for another? If that is possible, it may not be a just control. I can envisage all kinds of hardships on some and undue advantages to others. I would appreciate it if the Minister would devote himself to that theme and indicate what the Government thinks of that position. The Opposition says quite frankly that it finds the new control novel and even startling. The Opposition was startled when the Government adopted it. We can see it having a powerful effect to achieve what the Government wants in the way of restricting excessive borrowing and intending to force down interest rates. Our criticism is that it attacks only one field, which is, undoubtedly, a most important field. The Opposition would like to know how much lies outside that field. We are told that this is a temporary measure and that the Government has not had an opportunity to canvass the field in a practical way, either in Australia or overseas. The reason for that, I assume, is that the Government did not want to show its hand or alert the people before bringing in this legislation. That is an indication that the Government has proceeded without ascertaining all the facts in the situation. {: .speaker-JYY} ##### Senator O'Flaherty: -- The usual fits and starts. {: .speaker-KTN} ##### Senator McKENNA: -- Yes. It is proceeding without laying a basis of fact. That is one aspect that makes the Opposition nervous of this rather sectional approach to the problem. The convertible notes are in future to be treated as if they are shares. We have no quarrel with that proposal. Although the convertible notes are not, in law, shares, they are very largely resorted to as such by companies. They are of the character of shares and we do not quarrel particularly with the Government's intention to treat them as shares. We believe that the Government has failed the country in allowing things to drift to the position described in the Minister's speech alone. There is a lament in his speech about the lack of proper controls and of adequate constitutional power. On that point the Government is to be pilloried, because not only did it set up a committee to review the Constitution but it has had the committee's report in its hands for two years. During that time the Opposition has pointed out that the Commonwealth has been endeavouring to condition the economy from a position of grave constitutional weakness. The Constitutional Review Committee devoted very much thought to this problem of constitutional power and provided the Government with a great deal of matter for consideration. Just imagine how much more efficiently the Government could approach these crises if it had precise tools with which to meet the different situations that it encounters from time to time! {: .speaker-KBW} ##### Senator Wright: -- Such as? Suppose you had control over interest on mortgages in respect of land deals. What sort of tools would you use? {: .speaker-KTN} ##### Senator McKENNA: -- You would use a direct legislative approach to the matter. You would have to have regard to quite a lot of factors on the side but I suggest that you would do what was done at the time of the operation of the various moratoria legislation. You would legislate to fix the interest rate in those matters and you would apply that legislation not to one section only but to all sections of the community. I suggest that the legislation could be made effective by a broad provision that loans made in contravention of the interest rate legislation could be deemed to be void. You would then have a very tight control. In the view that I take such control could be operated effectively quite instantly. The Government confesses that it is in difficulty in legislating to deal with restrictive trade practices. The Government says that it would like to act, but one of the reasons given for the fact that legislation foreshadowed earlier this year is not yet before the Parliament is that the Government has encountered constitutional difficulties. Power over capital issues would be a precise instrument to use in the present situation when, as the Treasurer points out, you want to direct the flow of capital into activities that are important as against activities that are not so important. If the Government had control over consumer credit it would have control over the whole field of hire purchase and interest rates as they apply to hire-purchase transactions. The Government would have control over consumer credit and interest on loans secured against land. In his speech the Treasurer referred to certain predatory people. He pointed to the scandal of land speculation. I assume that he was pointing to the people who exploit the urgent need of our citizens for homes and who make outrageous fortunes out of land sub-division. {: .speaker-KBW} ##### Senator Wright: -- Are not some of the big hire-purchase companies lending money for homes at 6 per cent, interest? {: .speaker-KTN} ##### Senator McKENNA: -- I believe that some of them are lending money for homes but I do not know what interest rates they are charging. I should be surprised if the major portion of their funds was channelled towards home building, and I should also be surprised if they were making loans at rates of interest as low as that suggested by the honorable senator. {: .speaker-KBW} ##### Senator Wright: -- I think the rate is 6 per cent. flat. {: .speaker-KTN} ##### Senator McKENNA: -- That may well be an 'effective 9 per cent, or more. It is the concealed charge that constitutes the greatest burden for the unfortunate inexperienced person who has .to seek hirepurchase accommodation. {: .speaker-KPI} ##### Senator Kendall: -- To the interest charge is added the insurance premiums carried by the company itself. {: .speaker-KTN} ##### Senator McKENNA: -- That is right. Added together those items constitute a terrific burden for the person who needs commodities. In recent years we have seen the rush to buy television sets. That has been a normal rush because we have not had television in this country for very .long. One must point out that the new control introduced by the Government breaches a very long-standing principle in the taxation field - the principle that outgoings properly incurred should be allowable deductions in determining the assessable income. I suppose that is the first serious breach of the principle. It will be a breach of magnitude and it will have widespread effects. We shall certainly watch with interest to see whether the Government's expectations are realized. The Opposition will not oppose the measure. We will allow the Government to carry the full responsibility for imposing this tax, which is not directed at the whole economic field, not even at all companies, but only at some companies. We shall be very interested to see whether the legislation works with equity. We are not enthusiastic about the Government's approach to the problems that confront it. All we do is ask it to carry the responsibility for what it does. We shall watch the experiment with very great interest. {: #subdebate-36-0-s1 .speaker-KQQ} ##### Senator LAUGHT:
South Australia -- My speech this evening will necessarily be short. I was very interested in the analysis of this bill by the Leader of the Opposition **(Senator McKenna).** I was particularly struck by his reply to the rather apposite interjection of **Senator Wright,** who asked the Leader of the Opposition about rates of interest on mortgage transactions. **Senator McKenna** -said that the rate of interest would be limited. I recall that during the war period, when the war-time national security legislation was in force, it was possible for the Execu tive - the Cabinet - to make .regulations under .the defence power on practically every subject under the sun. A bureau was set up in each State. Those bureaux were under the control of the sub-Treasury. Every loan and every mortgage had to be submitted to a bureau for consideration. The flow of business - necessarily small at that time - was greatly limited. I should not like to see such a state of affairs in existence again. I do not think that the control that will be exercised under this bill is of the type of control that Senate McKenna advocated when he answered **Senator Wright.** If we had the kind of capital issues control advocated by **Senator McKenna,** with its limitation on rates of interest on mortgages, the present rate of overseas investment in Australia would fall alarmingly. As I see the position, investment from overseas is tremendously important at the present time in our developing economy, with our vast responsibility to develop this country and with the large migrant inflow. I believe that nothing is surer than that if the measures suggested by the Leader of the Opposition were given a serious go, that would happen in a very short time. Consequently, the future development of Australia would have to come from within this country through high taxation and the forced savings of the people. With **Senator McKenna,** I believe that this legislation possibly contains some ways of escape from the coils, as it were, of the legislation. It is new legislation and possibly it has been drafted quite hurriedly. Admittedly, the fact that this bill was received in the Senate only late this afternoon and the secondreading debate is, perhaps, half finished before ten minutes to nine on the same evening does nobody credit, lt is a great pity when close examination of legislation is apparently not provided for by the Government. The problem that has obviously confronted the Government is the new pattern of capital raisings which have taken place in the post-war period. I have looked at some figures which show that in the financial year 1948-49 new capital of slightly more than £30,000,000 was raised, of which £30,000,000 was in the form of new shares and only £300,000 was in the form of new debentures and notes. {: .speaker-JZY} ##### Senator Paltridge: -- What year was that? {: .speaker-KQQ} ##### Senator LAUGHT: -- That was 1948-49. In 1950-51 the new raisings by shares were £67,000,000 and the new raisings by means of debentures and notes shot up to £7,000,000. In 1956-57 the new raisings by shares was £43,000,000, and that figure was exceeded by the newraisings by debentures and notes which were £56,000,000. The figures for 1958-59 are astounding. The new raisings by shares were £48,000,000, and by debentures : and notes, £139,000,000. I believe that the figures contained in the October report of the Reserve Bank of Australia show new raisings by shares of £48,000,000- that figure was practically static between 1958-59 and 1959-60-but the newraisings which were secured by debentures and notes jumped from £139,000,000 to £193,000,000. {: .speaker-KBW} ##### Senator Wright: -- Can you offer any explanation for that trend? {: .speaker-KQQ} ##### Senator LAUGHT: -- Yes. I suggest to theSenate that the advantage that promoters and companies gained was that a straightout deduction for income tax purposes was allowed for interest on the £193,000,000 of the new raisings by debentures and notes, whereas there was not a deduction for dividends paid on the new raisings by shares of £48,000,000. Consequently, as was pointed out in the Minister's secondreading speech, that in effect gave a great taxation advantage to those who raised fresh capital by means of debentures, notes and equivalent securities. The problem disclosed in those figures was staringthe Government in the face, and this bill is what the Government has presented at this late hour of the session. However, I am inclined to take a broad view of this matter. The Treasurer **(Mr. Harold Holt),** in his second-reading speech, was perfectly frank about the whole business. He said - >We have therefore decidedto bring down an interim measure and it isthatwhich this legislation embodies. Its main purpose is toput an immediate curb on the kind of competition for money we are endeavouring to subdue during the period while a continuing scheme is drawn up and presented to Parliament. We intend to bring such a scheme forward as soon as we possibly can. In saying that, I would like it to be realized that thedifficulties are quite for midable. Nevertheless we are conscious of the need to push the matter forward with all possible despatch. So, the Treasurer has been quite frank. In effect, he said, '" We are putting the stops in now with this temporary scheme, this immediate curb, while we are bringing forward a comprehensive scheme which we will do as soon as we possibly can ". This legislation is unique in my experience in this Parliament. I do not praise the Government for bringing forward legislation of this nature at this late hour, with such a limited time for consideration of it. But I do say that the Government has taken a bold step and the Government would be mostblameworthy had it not done what it is doing to-night. {: .speaker-KNR} ##### Senator Hannaford: -- It is a pity that the Government did not do it before. {: .speaker-KQQ} ##### Senator LAUGHT: -- That is quite right. But, of course, it is very easy to have hindsight. However, we are faced with this problem and I intend to make a few suggestions as to what I expect the Government to do about it. I suggest that the new legislation be made the first item of business when the Parliament resumes. I suggest that the Government should not delay the resumption of the Parliament, as I regard it of paramount importance that precise information on this matter should be before the Parliament and receive close consideration. Australia is in mid-flight, as it were. As the Leader of the Opposition pointed out, vast projects are in progress and the people of this country and investors and entrepreneurs from overseas must know something definite about what will happen in the future, both in regard to money advanced to companies for their development and money advanced to individuals. Individuals within the country must know their taxation commitments with more precision than has been shown to-day in the Minister's second-reading speech. That should be the first business of the new session of Parliament. I would even go so far as to suggest to the Government that it should not prorogue the Parliament. 1 suggest that this problem should be a challenge to the Government to keep this Parliament open after the Christmas recess - until this legislation is settled. I feel that this problem presents an urgent challenge to the Government. 1 am conscious of the fact that a very important committee, which is investigating the taxation laws of the Commonwealth, is sitting at present. I refer to the Ligertwood Committee. That committee is discovering the whole field of income tax, but it has no charter to consider the aspect of income tax that relates to depreciation deductions because it was felt, I believe, that the Hulme committee, which met five or six years ago, had dealt with that subject in an adequate manner. We have this rather remarkable committee sitting in Australia at the present time, lt has been to every capital city, including the National Capital. It has received submissions from leading practising taxation consultants, accountants and business houses in every capital city. It has invited those who have made submissions to testify as to their submissions and to discuss any matters that the. committee desires to discuss arising out of the written submissions. I understand from discussions I have had in the right quarters that this committee is at present preparing its report. It could well be that the normal report of the committee will not be received by the Treasurer until well on into the middle of next year - about April or May. There would then be the usual period during which the report would be considered by officers of the Taxation Branch, the Treasurer, the Cabinet subcommittee and the Cabinet. It could well be that this Parliament would not see the result of the committee's work until the next Budget session. I suggest to **Senator Paltridge** that the attention of the committee be directed to the urgency of the matter before the Parliament to-night - the taxation of payments made by companies on convertible notes and other raisings. I suggest further that the committee be asked whether it would be possible to segregate from the evidence it has taken that portion of the evidence which relates to this problem. I suggest also that the committee be invited to make a preliminary report on that aspect of its investigations. I know that some fairly interesting evidence has been placed before the committee. One reads in the newspapers from time to time the submissions that have been made to the committee. In yesterday's Adelaide "Advertiser" I read a statement by **Mr. Walsch,** the president of the Taxpayers Association of South Australia, in which he commented on the problem that is now being considered by the Government. **Mr. Walsch** referred to the Government's approach as a patchwork and discriminatory approach. He is entitled to his opinion on that matter and I will not canvass it now, but he went on to say that the Taxpayers Association of South Australia had submitted to the Ligertwood committee a detailed submission suggesting that there be a deduction of all interest and dividends to a prescribed percentage of net profits, with an adjustment to the rate of company tax. One could speculate on the fuller meanings of those words, but to me the suggestion appears to be an interesting one. That suggestion has been made in detail to the Ligertwood committee and has no doubt been sifted by some of the great commercial brains of Australia that are on that committee. One of the members is a high executive of one of the leading banks of Australia. **Sir George** Ligertwood, the chairman, is, of course, a great legal figure in Australia. There are other men with practical experience. One is **Mr. Neale,** a former Chief Commissioner of Taxation for Victoria. These men, with their analytical minds, have sifted the evidence given on that problem and I submit that this Parliament would be enriched if it had a section of the Ligertwood report, devoted to the problem before us, presented to it in the orthodox way. It would come through the Treasury to the Minister, and then to the Parliament as soon as practicable after its resumption. I feel that this country needs all the brains it can muster to cope with this problem. I do not want to see this Parliament lay down legislation through which a horse and coach could be driven. This experimental legislation could be subject to that deficiency. I make my suggestion to the Government to-night with all due deference and respect, hoping that something can be done in the direction I have suggested. I make another suggestion to the Government. The Commonwealth is in a difficult constitutional position. The Constitutional Review Committee - of which **Senator** McKenna, **Senator Kennelly, Senator Wright** and **Senator Sir Neil** O'sullivan were distinguished members - has made a report. It will be some time before adequate amendments - if there are to be amendments - of the Constitution could be made, but in view of the urgency of the situation - there is urgency, as was indicated by the second-reading speech of the Minister - what would be wrong with having discussions with the Treasurers of the States and their chief executive officers, the UnderTreasurers? The State Treasurers would possibly welcome the opportunity to confer with the Government on the question that is before the Senate to-night. If the Commonwealth does not have the power to do certain things, you can rest assured 'that the balance of the power - the residuum - is with the sovereign States. I believe that a pooling of the brains of our Treasurer, our Treasury officials, State Treasurers - who in many cases are identical with the State Premiers - and State Treasury officials would be of some value. I make that suggestion to the Minister. When the Parliament meets again to give precise and detailed consideration to these matters, we could then be told of the reaction of the States to this problem. I know that in my own state of South Australia the State Government has given some consideration to the question of hire purchase, but its approach has been a dead and alive sort of approach, if I may put it that way. No doubt consideration has been given to that matter by other States of the Commonwealth. I believe that this is an occasion for joint State and Commonwealth action. I have nothing more to add. I do not think that one can usefully examine this bill clause by clause to-night. I will support the bill, but I urge the Minister to accept the challenge that the legislation presents and, during the next two or three months, before the Parliament resumes, to give consideration to the problem in the manner I have suggested. {: #subdebate-36-0-s2 .speaker-KBW} ##### Senator WRIGHT:
Tasmania .- I commence my remarks upon this bill by saying that I do not propose to vote against it. That is the measure of approval that I accord it. I suppose there will be those who will say that that is an attitude un becoming an individual in a House of Parliament, but I should explain that the time factor is very special in this case and, that it is quite obvious that any one in Parliament should exercise restraint in judgment as well as exercise authority. Therefore, when I spoke upon the Government's economic measures, distasteful as they were to me, I singled out for direct attention sales tax on motor cars and proposals for compulsory loans from life insurance companies. But I cannot abstain from referring to this measure, because it compels me to re-examine my judgment on matters political. I have put on record my views with regard to a controlled economy in a part of a dissenting report accompanying a report of the Constitutional Review Committee, and I shall make a quotation from it. If I am to be shifted from my faith that individuals who have savings and money to deal with should be left a measure of freedom to deal with them according to their judgment, in a spirit of free enterprise, then I must hear argument - purposefully discussed argument. I have yet to be persuaded that the idea of a controlled economy, whether it be on the order-and-decree basis - the true bureaucracy - such as capital issues control, and the control of the lending of money during war-time, or the restriction generally of the activities of an industry, the restriction of imports or the creation of a comprehensive supervisory body, such as the Reserve Bank, indicates the truth of this matter. I quote this passage from a judgment by **Mr. Justice** Kitto of the High Court - Financial controls of this general description have become familiar as devices appropriate to situations of actual or potential inflationary tendencies. They provide a means of assisting a selected category of purposes in the economic life of a community by precluding access or other purposes to some of the chief sources of finance. By thus controlling the flow of purchasing power, they have the practical effect of diverting goods and services away from those purposes which are not within the favoured class and (since they are unlikely to be allowed to lie idle if there is a demand for them in another direction) towards the purposes which the controls are designed to help. Having thus expressed himself with characteristic clarity, His Honor went on to say that such controls, although they differ in difficulty, are identical in nature with the conscription and direction of labour and- the compulsory acquisition and rationing of goods, direct and obvious controls- {: .speaker-JZU} ##### Senator Ormonde: -- A new order! {: .speaker-KBW} ##### Senator WRIGHT: -- I have found a reference to the matter in the Constitutional Review Committee's report.. The Treasurer **(Mr. Harold Holt),** when he introduced this matter to the Parliament, said that unrestrained competition for capital is not good for the economy, either in the short term or the long term. **Mr. President,** I must say that if I had heard that statement on the platform in December, 1949, I think it would have called forth from the people that I think supported my side of politics, a pretty vigorous response. I say that because I believe that the floor of this chamber is the place where one should debate the evolution of political principles and development. I shall not discuss the matter further because, as I say, this bill was introduced into this chamber only late this afternoon. This interim measure embraces a major part of the Government's plan. I regret that it has been presented in this way. As it applies to the 1960-61 taxation year, the measure will not really operate between now and March next. Everybody knows that the bill is on the stocks and there is a liability to be met, so it seems to me that no disadvantage would accrue if it were not enacted until March. On the other hand, possibly no real advantage would accrue. But there is one thing that I feel keenly. The impact of a measure of this sort can be made known to the Government only when the bill in its final form is distributed among the people who skilfully conduct their businesses in the complex economy of to-day. When the accountants and the traders have had a look at it,, all sorts of difficulties may be presented as the result of the specific experience of each taxpayer. If there were an interval of a fortnight between the circulation of the bill in its final form and the resumption of its consideration, members of the Parliament could' be alerted to the oddities of its application. I think we deprive the community of a real advantage if the people have not an opportunity to point out the difficulties. The next point I make is that taxation! is being used as an instrument of economic. control. I do- not know how long this has been, the political, theory of the Federal Government, but I do find in this type of taxation some extraordinary ideas - extraordinary to the outlook 1 have developed. I. do not know whether taxation; is more, acceptable than the direct form, of controls, the order-and-decree type where application has to be made to the controller of capital issues if you want to raise the capital of your company by inducing the public to put in another £50,000 or you have to ask a controller of finance for permission to borrow an extra £50,000 if you want to take your capital in loan capital. It seems to me that with the system of taxation that we have to-day, this proposal will introduce complexities which, in turn, must lead to inequities. This measure, **Mr. Acting Deputy President,** is said to have an anti-inflationary purpose. When I find that company tax is reckoned as a cost in industry, I see in that confirmation of the claim I make that, company tax is already an additional' cost in industry. To- add to that cost in the way that is now proposed carries the direct implication that a company can exist only by means of increasing its borrowings. If. a company has to go on the money market' and offer a rate of interest that will attract money, and if it then has to forgo the right to deduct that interest from income tax, it means that the company tax that that company must pay has been increased. As a permanent measure, to my way of thinking, this proposal will aggravate inflation. The next matter that worries me is that we have had no examination of our system of company taxation in comparison with the company tax systems of other countries, such as the United Kingdom. I had intended, to make a comparison for m.y own satisfaction, but I have not had the. opportunity to do so. We. must always, realize that company tax takes 8s.. in the £1 from the. profit of companies. Shareholders have to be paid a dividend from, the amount that remains.. That dividend', yield, already taxed in the hands of the company, is taxed again in the hands of the individual recipients- of the dividend.. It seems to me that the system of taxation in; the Commonwealth is clustered around the idea; of incorporation, and is investing- iti - almost, besieging it - primarily for the? purpose of yielding revenue. Incorporated companies have assisted our trading developments a great deal over the last century, but we are reaching the stage where such companies will be bearing a load of taxation that is really too great for the national interest. Having accepted the system of double taxation of companies for several years, we now propose to introduce what I believe to be a most anomalous principle. I should like the Minister to tell me whether this idea of denying to a company the right to deduct any portion of the interest that it pays on capital borrowed for the purposes of its business activities exists in any other British dominion or in the United Kingdom. It appears most anomalous to me. If the rates of interest that are being paid by the bidders in the fringe market outside banking control are the menace that they are said to be to the operations of the Reserve Bank and the control that stems from our banking system, will the Minister tell me why it is not possible to make a special rate of tax applicable to such rates of interest, as a part of income taxation? We used to have a differential between personal income and property income. In the State income tax acts, different methods were provided for assessing the income of insurance companies, banks and so on, and I suggest that it would be possible to provide a different method of assessing income tax for particular types of companies. {: .speaker-KNR} ##### Senator Hannaford: -- That point surely will be considered. {: .speaker-KBW} ##### Senator WRIGHT: -- I should like to know why, if I have been receiving interest at the rate of 10 per cent, on £10,000, that interest should not be taxable at a specially severe rate. It is a simple idea, but I suggest that honorable senators apply their minds to it. It would be interesting to know why such a special rate of taxation of high rates of interest has not been imposed. As long ago as 1954, **Sir Arthur** Fadden informed me that an excess profits tax, as a general provision, was impracticable and would lead to all sorts of inequities. But if predatory profits are being made from land speculation, why should not a specially severe rate of tax apply to income earned by persons selling and re-selling land in that way? If it is thought that there might be difficulty in determining which land sales were so taxable, I point out that in the old State legislation it was provided that if land were acquired in one year and disposed of within a fixed time, the proceeds Were taxable. {: .speaker-KUD} ##### Senator McManus: -- How would you get over the difficulty that people who sold land to young couples who wanted to build a home would simply pass on the tax? {: .speaker-KBW} ##### Senator WRIGHT: -- I think that the answer to that question will appear in a moment. I do not think that you can prevent that problem from arising, within limits, in respect of people who are buying land to build a home; but what about the people who trade with the companies that undertake to borrow money when this measure is in operation? The cost of the money will go up from 9 per cent, to 13 per cent. I think that a restriction such as this is an awkward impost to put on trade, as a permanent proposition. {: .speaker-K7A} ##### Senator Spooner: -- Your idea might well prove the basis for a capital gains tax in the future. {: .speaker-KBW} ##### Senator WRIGHT: -- The Leader of the Government in the Senate says that my suggestion, if it were applied to the acquisition and disposal of land within a limited period, might be the basis for a capital gains tax. But when, in 1952, I vexed the Senate for a whole afternoon, I am sorry to say, with amendments of an income tax bill, which was a feature of the economic controls of that year, my efforts were ineffective. When the Government introduced the " deemed disposition " provisions, which were very objectionable to me, it imposed a tax on capital accrual so that, on the death of a person and on his son inheriting the estate or taking it over in partnerhip, it became the subject of an income tax assessment. If the son did not elect to come in as the successor to the father, the father's estate would be liable to a tax which is not distinguishable from a capital gains tax. When in 1937 there was introduced for the first time a tax, not on the profits of carrying on a business but on profits made on winding up a business, you had a tax that was not distinguishable from a capital gains tax. When you draw a distinction between the carrying on of business and speculation in land as a capital transaction or speculation iri stocks and shares not carried on as a business, you impose a tax upon the yield of ordinary business profits and let the speculative profits go untaxed. I do not see a solution of the problem. All I wish to say is that we have had experience of some controls. **Senator Laught** has pointed out the way in Which trade has found that it is better to get loan capital than to get share capital. Why is loan capital preferred? It is preferred because not only is double dividend taxation avoided but also, while inflation goes on at the present rate, the borrower can be assured that in five years' time he will be paying back in depreciated currency. It is good for the shareholders of a company to borrow. The reason why the rates of interest are so high is that the lender will not lend at a fixed rate unless there is a compensatory consideration for the fall in the purchasing power of his capital during the period of the loan. Experience has shown that each control simply makes finance shy of this particular form of investment. Whereas ten years ago about 46 per cent, of trade investment was channelled through the banks, to-day only about 25 per cent, is so channelled. As I understand the situation, it has fallen by about 50 per cent, in ten years. {: .speaker-JZQ} ##### Senator Anderson: -- There has been an attraction to this other form of investment, of course. {: .speaker-KBW} ##### Senator WRIGHT: -- Quite so. Investors of capital are shy of controls. They will seek other fields so long as any part of the economy is free of controls. To my mind, to use taxation for the purpose of stemming inflation is a dubious procedure. {: #subdebate-36-0-s3 .speaker-JZY} ##### Senator PALTRIDGE:
Minister for Civil Aviation · Western Australia · LP -- in reply - I observe with satisfaction that the measure before the Senate has not attracted Opposition from any quarter of the chamber. Therefore, I do riot propose to speak at any length and I shall certainly attempt to avoid 'saying anything which may shatter the silence. However, I wish to offer a few comments that are pertinent to the subject we are discussing and which I think ought to be said. On a number of occasions when we have been discussing economic problems the Australian Labour Party, quite understandably from a political viewpoint, has taken the stand that if we had the economic controls that were advocated by a majority of the members of the Constitutional Review Committee ali would be well. We are now discussing a problem which does not necessitate the implementation of the economic controls which were proposed by the Constitutional Review Committee, even in the unlikely event of their being approved by the people. I use the term " unlikely event " because the whole history of referenda indicates that only on rare occasions - only when the proposals submitted to the people have attracted the active support of both parties - have they been carried. Let me say with great respect that I do not believe that the economic proposals put forward by the Constitutional Review Committee would attract the support of both the major political parties. I never fail to listen to the Leader of the Opposition **(Senator McKenna)** with interest and to admire his consistency of purpose, even though I may not admire what he advocates. Running right through his speech to-night was that continuing sense of purpose which we have correctly associated with him and his party over the years. I refer to his overpowering yen to have complete controls arid his endeavour to present this legislation as the kind of control which his own party would seek. The honorable senator has entirely forgotten, or has failed to discern, what has happened in recent years. **Senator Wright,** on the one hand, looks back almost with nostalgia to the days before there was a complete central banking system in Australia and when the banks themselves controlled their overseas funds and their domestic assets. **Senator McKenna** on the other hand speaks of the need to implement such direct controls as controls over imports, and particularly capital issues control. In recent years there has been established within the Australian banking system, a central bank which, on the one hand, has taken over control of a situation that was controlled by nine or ten separate banks prior to 1932, when overseas funds Were mobilized, and which, on the other hand, has removed the basic need for the direct control to which the socialist is always attracted. {: .speaker-JZU} ##### Senator Ormonde: -- We would just get there more quickly. {: .speaker-JZY} ##### Senator PALTRIDGE: -- I think that that is one of the things that impels the socialists to adopt a policy of control. They believe that they will reach their goal of socialistic control quicker that way than by any other means. That is the basis of their whole policy. To-day, direct controls have been replaced by banks operating under a central banking system. Looking at the matter historically, fairly and objectively, one might ask What was wrong with the old system, when the banks individually controlled their own overseas funds and domestic assets. If one answers that question quite honestly, one has to say that it did not work as well as it might have, for two reasons. One is that there was no overall knowledge of the strength of reserves, overseas or internally, and the other is that certain social changes had taken place in the democracies which the banks were not ready or equipped to accept. I think it is fair to say that prior to 1932, when banks individually felt the draught, or the effect of falling overseas reserves, they tightened up on domestic advances to an extent far greater than they have done now and certainly far greater than they did during recent months. {: .speaker-KBW} ##### Senator Wright: -- Would it be the same with the Bank of England? {: .speaker-JZY} ##### Senator PALTRIDGE: -- The Bank of England is an entirely different proposition, even in its central banking functions, if I may say so in passing, for this one reason: England - the Bank of England, particularly - has a magic box of financial control by virtue of government control of the bank rate. {: .speaker-KBW} ##### Senator Wright: -- I meant in comparison with individual banks. {: .speaker-JZY} ##### Senator PALTRIDGE: -- 1 do not follow the reference to the Bank of England in comparison with the Australian banks. On the one hand, **Senator McKenna** yearns for direct control. On the other hand, **Senator Wright** seems to see some attraction in complete absence of control. I simply express the view that the Government, not tied to the dogma of the Labour Party or to the practices of the past, is adopting a policy that is realistically related to the conditions of the times. I am reinforced in that view by this statement made by the conservative Chancellor of the Exchequer in England as recently as June, 1960, when faced, as this Government has been faced over a period of years, with ever-changing economic circumstances - >We have got to keep the economy within very narrow limits by using such controls as are appropriate The alternative to such controls as are available is a system of rigid controls. I have no doubt that in making this statement, he would have in mind the sort of controls which the British Labour Party, like the Australian Labour Party, has in its platform. He went on - >No one wants to return to the booms and slumps of pre-war, so people must get used to the fairly frequent, though not, I hope, violent turns of the wheel to keep the national economy on course. Having said that, he then detailed in three pages the various economic measures which the British Conservative Government had taken between July, 1958 and November, 1960. From that I draw some comfort. I also feel fortified that a conservative Chancellor should acknowledge the need not to seek the same dogma worked out years ago and probably worn out now but to be prepared to meet the changing economic circumstances of the time. {: .speaker-KQQ} ##### Senator Laught: -- The winds of change. {: .speaker-JZY} ##### Senator PALTRIDGE: -- The winds of change, as my friend reminds me. That is why the Government has continually taken action which is not laid down by precedent but is considered to be appropriate to the particular circumstances that obtain at the time. Taking only one aspect of this measure, the Government has felt compelled to take action in connexion with the non-convertible note. The reason, realistically stated by **Senator Laught,** was that the use of that sort of finance had reached a point where it had become a means of avoiding tax, and consequently a means of attracting capital at a rate less than a normal dividend rate. I know that a move in that direction prompts the very pertinent query: Why should that be done? This practice has existed for a long time. It has always been the practice to allow tax deductibility for this purpose. That only illustrates my point that tax deductibility was allowed over a period of years when the raising of finance of this sort was kept within what might be regarded as normal or reasonable limits. When that was departed from, the Government sought to take action to prevent it in order to protect its resources. {: .speaker-KBW} ##### Senator Wright: -- You are referring there not merely to convertible notes but to borrowings. {: .speaker-JZY} ##### Senator PALTRIDGE: -- I referred initially to convertible notes. I addressed the latter part of my argument to the entire field of raising finance in the manner described. I found **Senator Wright's** speech most interesting. The points that he raised were just those matters that the Government is now examining before bringing down precise proposals. Some of the things that **Senator Wright** mentioned reminded me that the Government's consideration had already been activated. **Senator Wright** referred to speculative sales of land. What is a speculative sale of land? The Government must find the answer to that question. I am not prepared to say to-night at what point penal rates should be applied against profits or against money raised at interest and used in this particular field, but I acknowledge at once that this is one question to which the Government must direct its attention before it introduces its legislation next year. **Senator Wright** spoke also of varying rates of interests as applicable to varying activities. That, too, is an interesting point. In the field of taxation it is not new that some activities should bear a higher rate of interest than others. I think that principle has applied in Commonwealth taxation at one time or another and was removed some years ago. The problem is intensified to-day because business, particularly big business, makes a practice of diversifying its activities. Is it a practicable solution to this particular problem to relate the volume of money raised by loan to shareholders' funds? Can you find a common base which can apply equitably to all types of business? I acknowledge that the Government must direct its mind to the questions asked by **Senator Wright,** but it has stated quite openly and frankly that the legislation now before the Senate is of an interim nature. It is not presented as a final, comprehensive or perfect scheme. It is presented to the Parliament as a step towards bringing about the cessation of practices that have not done the economy any good. I frankly acknowledge that answers to some of the really pertinent questions have not yet been formulated. Let me again express my satisfaction at the knowledge that the Senate is prepared not to oppose this measure. Question resolved in the affirmative. Bill read a second time. In committee: The bill. {: #subdebate-36-0-s4 .speaker-KBW} ##### Senator WRIGHT:
Tasmania -- Will the Minister for Civil Aviation **(Senator Paltridge)** tell me the significance of the words " declared pastoral company " appearing in proposed section 51aa.? In his original statement on the economy the Treasurer **(Mr. Harold Holt)** used the word " approved ". I am not particularly interested in the distinction between " approved " and " declared " but the expression " declared pastoral company " obviously suggests reverberations from history. What are we expected to look for before a pastoral finance company may be declared? Will the Minister also tell me what is meant by the expression " a dealer in the short-term money market "? Was that term used in the Treasurer's statement on the economy? I do not remember whether it was. {: .speaker-KNR} ##### Senator Hannaford: -- I think it was. {: .speaker-KBW} ##### Senator WRIGHT: -- Why is that person given a benefit in relation to excepted interest? {: #subdebate-36-0-s5 .speaker-JZQ} ##### Senator ANDERSON:
New South Wales -- I wish to refer to proposed new section 51aa. The section refers to "a company the principal business of which is the supply and distribution, by a system of reticulation, of water, gas or electricity ". Can the Minister amplify that provision, because quite clearly it is calculated to ensure that the section does not operate against bodies that are providing essential services. Nevertheless, reference is made to companies which supply and distribute. Some companies supply and some distribute. I would like to know whether we could have a clearer definition than is provided in sub-section (2.) of proposed section 51aa. I wonder whether the provision could be extended. For instance, take our telephone services. There you have almost an analagous situation in terms of cost to the community and community service. I would think that in this regard many companies may be committed in respect of distribution of telephonic communications and they might almost qualify in the same way as companies referred to in paragraph (e) of sub-clause (2.). lt is very difficult for a lay senator to understand the full significance of the provisions of the bill relating to retrospective application. The Minister, on page 8 of the circulated copy of his second-reading speech, said - >Besides this, the bill covers the position of companies which had at 15th November entered into firm commitments to borrow particular sums of money, or had actually invited applications for the loan of particular amounts of money. Let me give a hypothetical case. I do not want to discuss this matter on any other level. Clearly, a situation could arise in which a big undertaking, the bulk of its activities being the provision of governmental equipment, could be in the process of entering into financial obligations which could involve thousands and thousands of pounds, or almost £1,000,000. I suggest to the Minister the circumstance of tooling up which might involve a period of two or three years, and the undertaking's forward planning may commit it for sums of money amounting to hundreds of thousands of pounds two or three years hence. At that stage that undertaking may have made its financial arrangements only by memorandum and not by contract at all. It might well be that memorandums had been exchanged between the organization and a financial institution, but at that stage in the forward planning, nothing more than the memorandums existed. {: .speaker-KBW} ##### Senator Wright: -- Giving rise only to an understanding, but not a contract? {: .speaker-JZQ} ##### Senator ANDERSON: -- Yes, an understanding, but not a contract. I think the Minister would readily concede that that would be quite normal business practice. I ask whether that situation is met in this bill because as I understand it from my reading of it - I know my limitations in regard to this bill - there is a limit of £10,000 on deductibility for amounts of interest, and I do not know where we go from there. The point I want to make is that- {: .speaker-K19} ##### Senator Poke: -- You are taking a long time to make it. {: .speaker-JZQ} ##### Senator ANDERSON: -- That may be so, but this provision may affect the employment of thousands of men and women. If an organization enters into an agreement of this kind and suddenly finds at that stage of its planning that it will be involved in something which was not foreseeable, it may have to alter the whole of its forward planning. Whilst it is good to read the Minister's references to this matter in his second-reading speech, I wonder whether he would make some reference to the point I have raised in regard to retrospectivity. {: #subdebate-36-0-s6 .speaker-JZY} ##### Senator PALTRIDGE:
Minister for Civil Aviation · Western Australia · LP -- I shall deal first with the last point raised by **Senator Anderson.** It must be understood that provision exists in relation to the period before 15th November. Any money that a company borrowed prior to that date would be covered, and many of the companies of which the honorable senator spoke, which are carrying on continuous programmes of expansion, would have qualified already by virtue of the arrangements to borrow which they had made prior to that date. {: .speaker-KBW} ##### Senator Wright: -- If it was a binding contract, but not if it was a general understanding. {: .speaker-JZY} ##### Senator PALTRIDGE: -- Yes, but wait a moment. They would be covered on borrowings up until that date. It is true that cases may occur in which after 15th November arrangements may have been made without a firm commitment. The Treasurer **(Mr. Harold Holt)** has recognized that. In the debate in the House of Representatives this afternoon this very point was raised. I remind the honorable senator that a company has available to it the provision that full deductibility will be allowed up to £10,000, which will assist it. It also has available to it the provision as to the matching of the amount deductible this year with the amount for last year. Both of those provisions would be of aid in the case to which the honorable senator referred. We acknowledge that there may be a case whichis not taken up by any of the three provisions to which I have referred - a firm commitment or offer to make a specified borrowing, the £10,000 and the matching of the amount of interest for 1959-60. I say quite frankly that in that circumstance it would be necessary for the arrangement to be deferred until the new scheme comes into existence so that there will not be an extra charge. One cannot evade the point that to defer that sort of commitment might inconvenience the company concerned, but it would at least have the temporary effect which this legislation seeks. So, I make the point that the company can go up to the amount of £10,000 or it can go to an amount which matches last year's amount. Beyond that the company might be inconvenienced, but the purpose of this legislation would be served if the company deferred its action until June, 1961, about six or seven months hence. The honorable senator asked another question in respect of paragraph (e) of proposed section 51aa (2.), which reads - {: type="a" start="e"} 0. a company the principal business of which is the supply and distribution, by a system of reticulation, of water, gas or electricity. In this connexion the honorable senator mentioned the provision of telephone services. This paragraph does not apply to such activities. The companies to which it applies are private enterprise companies, not public utilities. The private enterprise companies would be such undertakings as the North Shore Gas Company Limited in Sydney. I am sorry that I cannot give the Senate any other examples. I do not know that there is one in my own State. Honorable senators will know other examples. The companies to which the paragraph applies are private enterprise companies, not public utilities, which are not included within the ambit of the paragraph. {: .speaker-JZQ} ##### Senator Anderson: -- May I interrupt to point out that clearly private companies must provide equipment for the PostmasterGeneral's Department. Part of the whole structure of the service rendered by the department is that private companies manufacture the equipment. That is the point I was making. {: .speaker-JZY} ##### Senator PALTRIDGE: -- I think the honorable senator will appreciate that it is difficult to give a general answer, but in the particular case where a company is undertaking the supply of materials to the PostmasterGeneral's Department, I think the almost general practice would be that that is a continuing operation which has been in existence for a number of years. Such a company would be covered by the provision that interest is deductible up to the amount of the interest that it paid last year. {: .speaker-KBW} ##### Senator Wright: asked a question about " declared pastoral finance companies ". The phrase means no more than approved pastoral finance companies. Those companies which will be approved are wellestablished companies. Their reputation is such that they are firmly established as pastoral finance companies. I was also asked why short-term money dealers are exempt. They are exempt because their rates are already controlled under the conditions of their permit or registration, whatever the appropriate word may be. Only nine companies are permitted to operate on the short-term money market, and their rates are already regulated. {: .speaker-KBW} ##### Senator Wright: -- Under what provision is that? Is it under the banking legislation? {: .speaker-JZY} ##### Senator PALTRIDGE: -- It is under the general banking legislation. I cannot refer to the particular act. {: #subdebate-36-0-s7 .speaker-KBW} ##### Senator WRIGHT:
Tasmania .- I hope there is no disposition to abbreviate the discussion of this most interesting subject. I should like the Minister for Civil Aviation **(Senator Paltridge)** to further elucidate what he has just said about matching amounts. Let me put a hypothetical situation. I have got to pay to a company interest on £100,000 of borrowed capital. That was my commitment last year. I want to borrow £50,000 this year. It seems to me that any additional borrowing this year must inevitably add to the interest commitment. {: .speaker-JZI} ##### Senator Sir Neil O'Sullivan: -- Is that in substitution? {: .speaker-KBW} ##### Senator WRIGHT: -- It does not seem to me that the effect of this legislation is that I can go on, year by year, adding to the capital. {: .speaker-JZI} ##### Senator Sir Neil O'Sullivan: -- What if you borrowed to pay off a debt? {: .speaker-KBW} ##### Senator WRIGHT: -- If you borrowed to pay off a previous amount, you certainly would not increase your interest liability, and therefore this would not apply. You lose only your deduction in respect of interest on principal borrowed in excess of what you borrowed last year. In connexion with these matching amounts, what the Minister said seemed to me to convey that if you borrowed £50,000 last year and brought up your total borrowings to £500,000, then you could borrow £50,000 again this year. I just state that for the purpose of having it corrected if it is wrong. It does not seem to me to be the correct position under the bill. I only raise that by way of preface to what I really rose to speak about. I direct the attention of the Minister to sub-sections (5.) and (6.) of proposed section 51aa. Those are the provisions to which **Senator McKenna** referred as laying a trap for those who would seek to escape the impact of the bill. You will notice, **Mr. Chairman,** that proposed sub-section (5.) begins by using the words " Where the Commissioner is satisfied ". That gives to the Commissioner the right to say whether he is satisfied or not. It is an arbitrary matter. The decision of the Commissioner is subject, I believe, to the discretion of a taxation board of review. Then we turn to what the Commissioner has to be satisfied of. He has to be satisfied that the company was - {: type="i" start="1"} 0. . incorporated after the fifteenth day of November, one thousand nine hundred and sixty, with a view- I emphasize that expression - to the affairs of that company and of another company being so arranged that this section would, but for this sub-section, have effect more favorably in relation to either or both of those companies than would otherwise have been the case. The expression " with a view " seems to me to be a vague generality. It is not an expression commonly used in legislation of this type, when the true intention of the expression is " with a purpose ". I direct attention to this matter in order to see whether or not the words " with a view " are used deliberately in order to cast the net wider. It seems to me that some ex planation should be given of the dropping of the word " purpose " and the substitution for it of the general word " view ". {: #subdebate-36-0-s8 .speaker-JZY} ##### Senator PALTRIDGE:
Minister for Civil Aviation · Western Australia · LP -- The honorable senator is quite right when he says that should a company request that the application of either proposed sub-section (5.) or proposed subsection (6.) be referred to a taxation board of review, the board will be free to substitute its own determination for that of the commissioner. I think that that in itself is some protection to a company. I am informed that the purpose of proposed sub-section (5.) is to prevent a company from forming a number of companies, each company in turn being able to obtain a £10,000 deduction. {: .speaker-KBW} ##### Senator Wright: -- Could I have explained to me why the words " with a view " are used when what is meant is " for the purpose "? {: .speaker-JZY} ##### Senator PALTRIDGE: -- I am informed that the expression " for the purpose " might, in this instance, berather too narrow to meet a situation in which companies might have purposes in addition to this one purpose. {: #subdebate-36-0-s9 .speaker-KBW} ##### Senator WRIGHT:
Tasmania -- If no other senator intends to rise, I wish to raise one further query. I refer to proposed sub-section (3.) on page 4 of the bill. Reference is made to a " company or body ". On looking at the definition of a company in the principal act, I find that it includes an association or body corporate or incorporate. Can I have explained to me the reason for using the word " body " in this proposed sub-section? Secondly, I should like to have explained to me what the operation of this sub-section is. It states - >For the purposes of the definition of " excepted interest" in sub-section (1.) of this section, interest paid or payable to a bank, company or body as a trustee, or on account of a customer or person dealing with the bank, company or body, shall be deemed not to be interest paid or payable to the bank, company or body. I find difficulty in visualizing the application of that provision as intended, and I should be glad if that could be explained to me, not in detail, but generally. {: #subdebate-36-0-s10 .speaker-JZY} ##### Senator PALTRIDGE:
Minister for Civil Aviation · Western Australia · LP -- The use of the word " body " has been queried by **Senator Wright.** I am informed that that word has been used to cover organizations such as building societies and enlarges the term " company " or any other such term. The other aspect to which the honorable senator has directed attention concerns payments to a person dealing with a bank, company or body. That provision, I understand, applies to payments made to the bank account of such a person. {: #subdebate-36-0-s11 .speaker-KBW} ##### Senator WRIGHT:
Tasmania -- I regret to trouble the Minister further and to detain the committee, but the matter is not yet clear to me. I should like the Minister to attempt once more to penetrate my understanding. Let us assume that a bank holds £50,000 as the trustee of an estate and that interest is paid to it in that capacity. I take it that that interest is not intended to be excepted interest. The next thing is that the payment is made into the bank to the account of a specified customer - John Smith. He is in one case a trustee and in the other case not a trustee. Is that interest excepted interest or not? {: .speaker-JZY} ##### Senator Paltridge: -- The interest referred to is interest on money lent by a bank and it is to be exempt, but interest on money lent by the customer and paid to his account is not. Bill agreed to. Bill reported without amendment; report adopted. Bill read a third time. {: .page-start } page 2262 {:#debate-37} ### ADVANCE TO THE TREASURER. 1959-60 {:#subdebate-37-0} #### Statement of Expenditure In committee: Motion (by **Senator Paltridge)** proposed - >That the committee approves the Statement for the year 1959-60 of Heads of Expenditure and the amounts charged thereto pursuant to section 36a of the Audit Act 1901-1960. {: #subdebate-37-0-s0 .speaker-KPK} ##### Senator KENNELLY:
Victoria -- To be quite candid, **Mr. Temporary Chairman,** I suppose the only person in the chamber who knows exactly what we are being asked to approve is the Minister for Civil Aviation **(Senator Paltridge)** himself. I greatly regret that at this hour we are called upon, after several very late sittings, to deal with matters that we have not had time to examine. The Minister has now handed to me a printed document headed "Division No. 650, Advance to the Treasurer - £16,000,000". That is quite a lot of money. As it would take some time for me to go through this document, which comprises 57 pages, and discuss it, all I can say is that I regret that the statement has been brought forward for consideration at a time when we are not able to scrutinize it closely. I protest against the way in which business is presented to this chamber. {: #subdebate-37-0-s1 .speaker-JZY} ##### Senator PALTRIDGE:
Minister for Civil Aviation · Western Australia · LP -- I feel that I should say something in reply to the criticism which has just fallen from the lips of the Deputy Leader of the Opposition **(Senator Kennelly).** I think honorable senators will recall that this paper was tabled this morning, and the Senate ordered that it be considered in the Committee of the Whole at a later hour of the day. {: .speaker-K7Y} ##### Senator Tangney: -- How many hours ago was that? {: .speaker-JZY} ##### Senator PALTRIDGE: -- That was about 11.30 o'clock this morning. {: .speaker-K7Y} ##### Senator Tangney: -- But we have been busy ever since then. {: .speaker-JZY} ##### Senator PALTRIDGE: -- That is not the point. This is a document headed " Statement of Heads of Expenditure and the amounts charged thereto pursuant to section 36a of the Audit Act 1901-1960". It refers to the item " Advance to the Treasurer - £16,000,000 " under Division No. 650 of the Second Schedule to the Appropriation Act 1959-60. This statement merely sets out what amounts have been expended from the Treasurer's advance, approval for the expenditure of the total sum of £16,000,000 having been given by the Parliament at a prior date. {: .speaker-KAW} ##### Senator Wedgwood: -- It was included in the Estimates. {: .speaker-JZY} ##### Senator PALTRIDGE: -- That is so. A statement of this kind comes before the Parliament each year. There is nothing mysterious or unusual about it. The committee is now considering it, pursuant to an earlier decision of the Senate that it be made an order of the day for a later hour of the day. Consideration interrupted. {: #subdebate-37-0-s2 .speaker-JZQ} ##### The TEMPORARY CHAIRMAN (Senator Anderson:
NEW SOUTH WALES -- Order! In conformity with the sessional order relating to the adjournment of the Senate, I formally put the question - >That the Temporary Chairman do now leave the chair and report to the Senate. Question resolved in the negative. Consideration resumed. {: #subdebate-37-0-s3 .speaker-KPK} ##### Senator KENNELLY:
Victoria -- The Minister for Civil Aviation **(Senator Paltridge),** who has spent a long time in this chamber to-day, should know as well as 1 do that there has not been much time for us to peruse the statement. I am pleased to know from **Senator Wedgwood** that the amount of £16,000,000, to which the statement refers, was included in the Budget. {: .speaker-KAW} ##### Senator Wedgwood: -- It was in the Estimates. {: .speaker-KPK} ##### Senator KENNELLY: -- Only in total. It was not itemized. I do not think that castigation is called for, but I remind the Minister that some of us are finding it difficult to keep awake because of the long hours for which the Senate has been sitting. One becomes physically exhausted. {: .speaker-KPI} ##### Senator Kendall: -- We are getting soft. {: .speaker-KPK} ##### Senator KENNELLY: -- I suppose we are not of that great breed with which **Senator Kendall** associated when he was serving in ships during the war. The fact that the details of the expenditure are given in the statement that we are discussing might have afforded us an opportunity to scrutinize the expenditure, had we the time to do so. However, I raise no further objection. {: #subdebate-37-0-s4 .speaker-JZY} ##### Senator PALTRIDGE:
Minister for Civil Aviation · Western Australia · LP . -I assure **Senator Kennelly** and, if it is necessary to do so, every member of the Senate, that there is no rush and that no haste is called for in the consideration of this paper. In fact, it was distributed to **Senator Kennelly** and all other members of the Senate on 16th August last, or about four months ago. {: #subdebate-37-0-s5 .speaker-KPK} ##### Senator KENNELLY:
Victoria -- As the Minister knows, quite a numberof documents are placed in our offices each day. One would need quite a large staff if he wished to have documents placed in front of him at exactly the right time. I suggest to the Minister that the sitting be suspended for about 12 hours and that we meet again at half-past ten in the morning. In the meantime, we would have an opportunity to give to the statement the thought that the Minister wishes it to be given. However, as I can see from the expression on the Minister's face that there is no hope of that request being granted, I shall say no more about the matter. Question resolved in the affirmative. Resolution reported; report adopted. Sitting suspended from 10.37 p.m. to 12.28 a.m. {:#subdebate-37-1} #### Friday, 9 December 1960 {: .page-start } page 2263 {:#debate-38} ### JUDICIARY BILL (No. 2) 1960 Bill received from the House of Representatives. Standing Orders suspended. Bill (on motion by **Senator Henry)** read a first time. {:#subdebate-38-0} #### Second Reading {: #subdebate-38-0-s0 .speaker-KOW} ##### Senator HENTY:
Minister for Customs and Excise · Tasmania · LP .- I move - >That the bill be now read a second time. The purpose of this bill is to increase the salaries of Her Majesty's justices of the High Court of Australia. The present salaries, last dealt with in 1955, are as follows: - Chief Justice, £8,000 a year; each puisne justice, £6,500 a year. It is proposed to set the salaries at these figures - Chief Justice, £10,000 a year; each puisne justice, £8,500 a year. The High Court of Australia is the constitutional court of the Commonwealth. That is to say, it is the only court established by the Constitution itself, and thus is the only court dealt with in this bill. It performs, as an organ of the National Government, the supreme judicial task of the interpretation and safeguarding of the federal Constitution. Not merely does this function call for consummate knowledge of the Constitution, its history and its past construction, but also for great judgment of a practical kind. The decisions of the Court on constitutional questions carrygreat consequences for the people of Australia as a whole, and indeed form part of the history of the nation, not merely of its developing law. In addition, the High Court, in this respect unlike the Supreme Court of the United States, has a general appellate jurisdiction throughout the whole range of the law from other federal courts and from the supreme courts of the Stales. One has only to glance through the voluminous Commonwealth law reports to be alerted to the wide spread knowledge, experience and practical judgment required of the members of this great court. The problem of setting appropriate salaries for the judiciary is never easily resolved. Many factors must be weighed, such as the need to attract the most able men when still at the height of their careers in the legal profession, the need to secure to the Bench financial independence and freedom from pecuniary anxiety, the need to reflect the prestige of the court, and a sense of justice in the remuneration for the work required to be done. Tn addition, some questions of relativity arise. Whilst the Government does not think that judicial salaries should be varied with any frequency, or with any particular reference to changes in the wage levels or structure in industry, it cannot overlook an altered level of remuneration in the community generally and particularly the chances in the salaries of the statutory officers. In this connexion, it should be recalled that the judges have not been included in the adjustments made since 1955 in the salaries of Commonwealth officers and that by the Salaries (Statutory Officers) Adjustment Act 1960, which was passed earlier this year, salaries of some of the most senior statutory office holders were increased to £6,900 a year. Even more significantly, the salaries of the judges of the supreme courts of some of the States of the Commonwealth have been increased several times since 1955. I shall mention in a moment the amounts of these salaries to enable comparison to be made. But let me at once say that the supreme courts of the States are great courts carrying heavy responsibilities over wide fields of law, finally settling the greater number of controversies of fact between citizens. However, not only are many constitutional cases beyond their competence, but also the High Court is a general court of appeal in respect of their decisions. It is, in the Government's view, intolerable that salary of any of the judges of a supreme court should be larger than those of the justices of the High Court. The present position is that in comparison with the salaries payable in the States of New South Wales and Victoria the salaries of the justices of the High Court, with the exception of the Chief Justice, are less than the effective salaries of the supreme court judges. The following table shows the movement of the respective salaries over the last five years: - In making these comparisons it must be borne in mind that the allowances paid by the States are intended to be free of tax and in fact are deductible for purposes of taxation without any vouching of their expenditure. As I have said, the Government does not desire that there should be frequent changes in judicial salaries, and in particular it does not desire that this movement should be in any particular sense related to changes in wages payable in industry. It therefore hopes that the present levels of salary will endure for a substantial period of years in the future. Weighing all these factors involved, the Government has decided to ask the Parliament to set, by this statute, what it considers to be proper levels of remuneration for the justices of the High Court of Australia. These figures I have already mentioned. The only other matter I need to mention is that the Government decided that the new salaries should take effect from 1st October, 1960. Pressure of other business prevented this legislation from being introduced earlier, but the bill provides accordingly. I commend the bill to the Senate. {: #subdebate-38-0-s1 .speaker-KPK} ##### Senator KENNELLY:
Victoria -- It is remarkable that a bill of the importance of this measure should be introduced at this hour on the last day of the session. I am not opposed to judges of the High Court being well paid. I agree with the Minister for Customs and Excise **(Senator Henty)** when he says that they occupy a very high judicial office. Over the years we have held the judges of the High Court, irrespective of who they have been, in the highest esteem. I believe that a man is worthy of his hire, but I remind the Senate that the proposed rise in the salaries of these judges is approximately £40 a week or approximately £6 a day. It is true, of course, that the proposed salaries will be taxable. But it is remarkable that the increase should be so great. I would have no qualms if the bill now before us fixed the salaries of judges in the same proportion in which they were fixed in 1955. It is not of much use for the Government to say that the economy is in a certain condition, that we all must tighten our belts, that the great mass of the people who use hire-purchase finance must not be as free to use it in the future as they have been in the past, and then for it to provide for an increase like this. I would be the last to cast any reflection upon the great men who sit on the High Court bench. I do not believe that the position of Chief Justice of the High Court should be measured in terms of pounds, shillings and pence. I admit that the Chief Justice has to live, but he is able to live well on £8,000 a year. I know he has to pay tax, but he still lives extremely well. No doubt his work is heavy and, as do most members of the legal profession, he has to do a lot of work at night. Surely the matter of money cannot be important, particularly at this time, to a man who occupies the position held by **Sir Owen** Dixon, whose name I say with great respect. If the Government had said that the Chief Justice of the High Court received so much in 1955, that the purchasing power of his salary had decreased by so much since that time and that it should be restored, I would have agreed with the proposition. When all is said and done, he gets the things to which he is normally entitled, and I do not object to that. He receives a travelling allowance and he has a secretariat to assist him in his work. I have no growls about that. But in addition, when he has served ten years or is 60 years of age, he can retire on a non-contributory pension of half his salary. When we come to talk about pounds, shillings and pence in this context, we are entitled to examine the whole position. I marvel at it especially when there is a suggestion that every one should tighten up. The bill proposes that the increases be made retrospective to 1st October. We have tried to make many things retrospective, but we have not got very far. The Parliament has been sitting now for eighteen or nineteen weeks. This is not a very big bill. It must have been in the mind of the Government long ago. Why was it not brought down at about the time when it was intended that the increases would apply? It is of no use to tell the masses of people that they have to do this and that they cannot have any increase in wages. They cannot get any improvement at all. I did not want to say that in regard to this bill. I intended to mention it in the debate on the bill which will be presented next. and to which I am even more strongly opposed. The Government is talking with tongue in cheek. It suggests that we have to draw in the belt a little but then it introduces a measure such as this. I have the greatest respect for the people who fill these high and honoured positions, but I do not think it is a fair thing to bring in this measure at this time of the day in the closing hours of the session, at the end of a busy week. The Government should have abstained, out of respect for the people concerned, from taking this course. The Chief Justice of the High Court is a big Australian. His work is renowned not only within Australia but also in other spheres in which the Government has asked him to work. {: .speaker-K2I} ##### Senator Branson: -- Is the Parliament less important in the dying hours than in the initial hours of a session? {: .speaker-KPK} ##### Senator KENNELLY: -- I think it is much less important. We should not have had to wait until this time to get this bill, when the Government wanted to make the increases retrospective to 1st October. A remarkable plea has been advanced. It is said that High Court judges' salaries should be increased, because some judges in State courts have received increases. The Government has no jurisdiction at all over those judges. I do not think it would want jurisdiction over them. It does not want the powers that I would like it to have. The fact that the New South Wales Government or the Victorian Government has given its Chief Justice a certain salary is not an argument in favour of increasing salaries of High Court judges. Quite candidly, I believe that the Chief Justice of the High Court ought to receive a higher remuneration because he occupies the highest judicial position in the land, not just because New South Wales pays its Chief Justice a little more or because Victoria increases the salary of **Sir Edmund** Herring, for whom T have great personal respect. Those are arguments used m the second-reading speech to justify the increases proposed. That cannot be a proper basis. {: .speaker-KAC} ##### Senator Vincent: -- Why not? {: .speaker-KPK} ##### Senator KENNELLY: -- I do not think that it should be. If we fixed the remuneration of all the judges, we would certainly put their salaries in correct perspective, but Jim Brown in one State fixes the remuneration of his Chief Justice and Joe Blow in another State fixes the remuneration of his Chief Justice. If increases in the States are to be used in favour of the increases proposed in the bill, the natural corollary will be that Joe Blow will restore the former salary relationship that his Chief bore to the Chief Justice of the High Court. It will be a case of a dog trying to catch its tail. I speak with the .greatest respect for the judges concerned, tout I think that the procedure is wrong. Let us be quite candid. I suppose that after paying tax on a salary of £10,000 a year the Chief Justice would be lucky to retain half of that salary. Any man receiving about £100 a week is not doing too badly. {: .speaker-K2I} ##### Senator Branson: -- Are you judging the position on that, irespective of the work that is done? {: .speaker-KPK} ##### Senator KENNELLY: -- If the honorable senator wants to make my speech, I shall sit down. *Tin,* Government cannot have it both ways, but that is what it is seeking to do. One day, in a statement on the economic position the Government nearly frightens me. {: .speaker-K2I} ##### Senator Branson: -- You are drawing the long bow. {: .speaker-KPK} ##### Senator KENNELLY: -- It is a real bow to most of the people. They will not understand this behaviour. They will want to know why this is being done. {: .speaker-K2I} ##### Senator Branson: -- You should help them to understand it. {: .speaker-KPK} ##### Senator KENNELLY: -- How can one help them to understand it? The Australian Labour Party in no way decries the occupants of the High Court Bench, but the bill is badly timed. I do not think any hardship would accrue to the judges if the bill were defeated. I regret that the Government, while it was dealing with conditions of appointment of judges, did not fix a retiring age. I do not want to become involved in another altercation - one a week is sufficient - 'but I can remember a certain member of the judiciary - a judge of the High Court - who delivered some very sound judgments during his early days on the bench. Towards the end of his career he doggedly held on to his office until there was a change of government. He then quickly retired. I regret very much that a retiring age is not fixed for judges of the High Court. However, that is not a matter strictly related to the bill. I have not intended my remarks to show any disrespect for the occupants of these high positions. I know that they are great men. I know that they are doing a great job. But we think that the bill is wrong and we will vote against it. {: #subdebate-38-0-s2 .speaker-KBW} ##### Senator WRIGHT:
Tasmania -- -MV presence in this place imposes on me a duty, in the light of what has been said by **Senator Kennelly,** to rise to state a few simple fundamental beliefs. We live in a dominion steeped in the tradition of British justice. The first element in ensuring the liberty of the individual in Great Britain was to secure the independence of judges. When the tyranny of the Stuarts was overthrown and the revolution established something like an incipient democracy, the first thing that was done was to grant life tenure and emoluments that gave independence to the judiciary. Those emoluments were not related to the remuneration received by us people who work and live in other sections of the community. When we speak of the judiciary we do not refer to the persons who occupy these exalted positions. It is our function as a parliament to fix a salary appropriate to the position of the judiciary. Our system of government divides our community, first, into the Parliament; secondly, into the Executive; and thirdly, into the judiciary - the arbiter or the exponent of justice upon whom every individual member of the community depends for justice. How nobly our judicial officers have served this Commonwealth! Does **Senator Kennelly** know that the present Chief Justice has been acknowledged by pre-eminent jurists of America and England as the foremost jurist of this generation in the English-speaking world? Australia is distinguished by the federal judiciary that serves it and expounds the law. I implore every section of the Parliament to get a conception of the importance of the judiciary. Do not make comparisons between the remuneration of the judiciary and that of other sections of our community. All of us pursue our employments but the judiciary is the third branch of our constitutional government. Let us respect it as the dispenser of justice as between governments, Commonwealth and State, as between citizens and governments, and as between individuals. **Senator Kennelly** referred to the remuneration of supreme court judges. That is a legitimate consideration because in the judiciary the hierarchy of jurisdiction is traditionally respected and the High Court of Australia is the superior appellate court in this country. In our tribute and recognition of the superiority of that jurisdiction we recognize that the office should be accompanied by emoluments that indicate its relative position in the hierarchy. The High Court comes first, followed by the supreme courts of the States, which, as the Minister for Customs and Excise **(Senator Henty)** has said, discharge most important duties in the State jurisdiction. We live in a Parliament that has terrific national duties. The first duty is to appreciate how every member of this Parliament, serving the institution of Parliament, is dependent upon the judiciary to see that the laws are administered as between governments and individuals without fear or favour, affection or ill will. Let us divorce personalities from our consideration of this matter. Let us pay due recognition to this noble office, at which no person in this country can point a finger indicating disparagement. When we come to the question of providing remuneration for the judiciary, let us not attempt to compare incomparables because the function of the judiciary is the third function of government. We should recognize the responsibility of the judiciary when we fix salaries for the office. In accepting the statement made by the Attorney-General **(Sir Garfield Barwick),** we recognize that there is no one in Australia more competent to indicate the degree of prestige that should be accorded to the federal judiciary. I hope that every party in this Parliament will regret the public vilification that occurred elsewhere, because the electors all depend for their security in justice upon maintaining the independence and prestige of the judiciary. {: #subdebate-38-0-s3 .speaker-JYA} ##### Senator O'BYRNE:
Tasmania -- **Mr. Acting Deputy President,** I have no desire to measure the remuneration of judges by imponderables, but I believe that justice knows no boundaries. I should like to direct the attention of the Senate to a few thoughts I have on this matter. As shown in the table included in the Minister's second-reading speech, since 1955 the salary of the Chief Justice of the High Court of Australia has remained at £8,000. Over the same period, the salary of the Chief Justice of Victoria has increased from £5,000 to £7,250, and the salary of the Chief Justice of New South Wales has increased from £5,925 to £7,250. At present there is a difference of £750 between the salaries of the Chief Justice of the High Court and the Chief Justice of New South Wales. Since 1955 the salary of a Commonwealth puisne judge has remained at £6,500, while the salary of a New South Wales puisne judge has increased from almost £5,000 to £6,500, and the salary of a Victorian puisne judge has increased from £4,500 to £6,500. {: .speaker-KAC} ##### Senator Vincent: -- We have heard all those figures before. {: .speaker-JYA} ##### Senator O'BYRNE: -- I want to make the point that justice knows no boundaries and we want to get men of the highest calibre as judges of our courts, as was stated in the Minister's second-reading speech. I hold the view that it is intolerable that the salaries of any of the supreme court judges should be higher than those of the judges of the High Court. I believe that we should have justice on the highest level and, using the Minister's words, we should be able to " attract the most able men when still at the height of their careers in the legal profession " and " secure to the bench financial independence and freedom from pecuniary anxiety ". {: .speaker-JZY} ##### Senator Paltridge: -- Are you supporting the bill? The **PRESIDENT (Senator the Hon. Sir Alister McMullin).** - Order! {: .speaker-JYA} ##### Senator O'BYRNE: -- Order! Continuing to use the Minister's words, there is a " need to reflect the prestige of the court and a sense of justice in the remuneration for the work required to be done ". I should like to know where this practice of the dog chasing its tail will stop. {: .speaker-K5K} ##### Senator Scott: -- When the dog catches its tail. {: .speaker-JYA} ##### Senator O'BYRNE: -- You would know a bit about that, too. When the Australian Constitution was framed, the salary of the Governor-General was set at £10,000. To-day, because of economic circumstances, the salary of the Chief Justice is being set at £10,000. {: .speaker-JZU} ##### Senator Ormonde: -- That is not a bad salary. {: .speaker-JYA} ##### Senator O'BYRNE: -- As one of my colleagues says, that is not a bad salary. I believe that a salary of £10,000 should free the Chief Justice from pecuniary anxiety and enable us to attract to that post the very best men, the ablest in the profession. But the fact remains that justice knows no boundaries and justice is just as important in Victoria and New South Wales as it is in the Commonwealth. Are we going to make a division between the judges of the Commonwealth and those of the States? They are men of the highest quality and the highest calibre. It has been said that there is a wider range of jurisdiction in the Commonwealth than in the States, and that is true. {: .speaker-KAC} ##### Senator Vincent: -- Does justice or Justin know no boundaries? {: #subdebate-38-0-s4 .speaker-10000} ##### The PRESIDENT: -- Order! The honorable senator can make his speech without assistance. {: .speaker-JYA} ##### Senator O'BYRNE: -- Have we reached the point where the division of status as between the States and the Commonwealth is being accentuated when it is said that the puisne judges of the Commonwealth must receive a higher salary than the puisne judges of the States? When the salaries reach the proper level, where the salaries of puisne judges of the Commonwealth and of the States are on the same level, it is suggested that the salary of the Chief Justice must be increased to maintain his proportionate advantage. {: .speaker-JZU} ##### Senator Ormonde: -- For him to keep his margin. {: .speaker-JYA} ##### Senator O'BYRNE: -- That is right. That is what the bill does. I hope that the line will be drawn here because salaries at this level should give men of the calibre of our judges freedom from pecuniary anxiety. I hope that the practice of the dog chasing its tail will stop here, but it will not. {: .speaker-KAC} ##### Senator Vincent: -- Keep that dog out of it. {: .speaker-10000} ##### The PRESIDENT: -- Order! **Senator O'Byrne** is making a speech on an important bill. When this bill was in another place the behaviour of some persons was not very good. Honorable senators should listen to **Senator O'Byrne** in silence, without giving him the assistance of interjections which are not helping him in his speech on this important matter. {: .speaker-JYA} ##### Senator O'BYRNE: -- Thank you, **Mr. President.** In a comparison, we should divorce the salaries of judges from the salaries for other forms of human endeavour, valuable as they may be. Our judges should be completely free from any fear of not being able to maintain their status, but that should be the last consideration. One of the great features of the Australian judiciary is that we have never had any instances of such things as bribery and corruption of its members. That is proof that the people of Australia have realized how necesary rt is to pay them a salary commensurate with the high office they hold. From the table included in the Minister's second-reading speech, it appears that once the Commonwealth judges receive an increase in salary, the natural sequence will be for the States to follow, and so it will go on. I believe that we should look at this matter with the object of drawing the line somewhere in regard to CommonwealthState jealousies and values. We should make it our standard to give the Chief Justice of the High Court of Australia a salary which will free him completely from any monetary anxiety, and the puisne judges of the Commonwealth and States should receive equal salaries. Then we should do away with this continuous process of one section of the judiciary trying to catch up with another and of one section trying to establish a prestige higher than that of another. T do not think it is in the best interests of the lesser people of this country to see this type of thing going on at the highest level. However, I support the bill. THE PRESIDENT.- Order! There is a great deal of laughter. Let me say this to honorable senators: If you want to turn the debate on this important subject into a source of entertainment, I would advise you not to do so. The honorable senator is perfectly entitled to make his speech on what surely is one of the most important bills that the Senate has had before it. It calls for restraint. The honorable senator is entitled to say what he wishes to say without being laughed at. {: .speaker-JYA} ##### Senator O'BYRNE: -- In conclusion, I should like to say that we should not go haywire in connexion with relative values. I hope that this measure will serve to set a standard that will not be quickly altered. I think that the position has gone as far as it should go. {: #subdebate-38-0-s5 .speaker-K5X} ##### Senator SHEEHAN:
Victoria -- I rise to speak on this very important measure, not because I disagree with the method of fixing the salaries of our judges, not because I think the salaries suggested are not commensurate with the very high positions that the judges occupy, but to suggest, **Mr. President,** that the circumstances under which this bill has been introduced into the Parliament are not in the best interests of either the judges or this Parliament. This is a matter that should be considered with dignity. It should not be dealt with in an hilarious manner. In presenting a case in favour of the bill, **Senator Wright** suggested that the High Court of Australia was the third instrumentality in the government of this country. Upon consideration, I think it is the most important instrumentality in the government of the country. In the United Kingdom, the Parliament is supreme. It initiates all laws and gives effect to the laws it passes. This Parliament, however, does not have supreme power. Every act passed by this Parliament is subject to challenge in the High Court, and it is the judges of that court who have the final say as to whether this Parliament has exercised its powers in accordance with our Constitution - a written Constitution. So the judges of the High Court have greater power than we have. We can initiate legislation, but they interpret that legislation and determine the function of the Parliament. The determination of the salaries of the eminent gentlemen who comprise the High Court has to be considered from that point of view. I do not intend to quarrel with the amounts that have been allotted to them. They occupy high offices and, as **Senator Wright** has pointed out, they should be placed in such a position financially that no one could ever believe that their judgments could be in any way tainted by things that happen in other walks of life. I have said that this bill has been introduced at a most inappropriate time. Had the Government introduced the bill in October of last year, after large salary increases were granted to heads of departments, the possibilities are that it would have passed unnoticed. But the Goernment has introduced the measure in the dying hours of a parliamentary session and at a time when this country is in a turmoil because of economic conditions. What is the main contention that has been put forward in relation to the cause of the present economic conditions? It has been contended that the Commonwealth Arbitration Commission has been over-generous to the workers of this country. It has been said that because of the increases recently granted by the commission, inflation has increased. It has been suggested by honorable senators in this chamber that these wage increases constitute the main cause of the present inflationary surge. Just consider the conditions that exist in the industrial world at present because of this inflation. No section of the working community is thoroughly satisfied with its conditions. One section of the community has been refused any amelioration of its conditions, but the increase in the remuneration of the judges is to be made retrospective. The Arbitration Commission has never made its awards retrospective, nor has this Parliament made increases in social service payments retrospective. The pensioners have asked the Government to give them something to tide them over the Christmas period. They have pointed out that they will not have a pay day before Christmas. What will the pensioners say when they hear what is contained in this bill? We can imagine the turmoil in their minds when they learn of the retrospective provision contained in this measure. I say that the Government has been most ill-advised in introducing this measure at this particular time. The Government is responsible for what has happened. It will be responsible if a large section of the community, instead of having a great respect for this body of men, is inclined to think the other way. Some honorable senators have said, " Let us get away ". We should have gone long ago, but why should a bill such as this have been introduced at the fag end of a long session? I think the Government deserves criticism for introducing it at this time. {: #subdebate-38-0-s6 .speaker-L8E} ##### Senator CAMERON:
Minister for Health · Victoria · LP -- **Mr. President,** I agree with those who have said that this proposed increase in judges' salaries is ill-advised, and I say in addition that it is unwarranted. The amount of money proposed to be paid to the judges is, in my opinion, considerably in excess of what is actually needed. I am concerned particularly with the effect that this will have on the workers. **Senator Wright** referred emphatically to British justice, but he did not define exactly what is meant by that term, lt means justice for those who are doing exceptionally well, but organized injustice for those who are poverty-stricken. That phrase, spoken without qualification, and other phrases are used in order to create a wrong impression or are used by people who have not a correct understanding of the actual position. **Senator Sheehan** referred to the Arbitration tribunal. As he rightly pointed out, the court has never granted an award with retrospective application: Why is the Government, in this bill, establishing a precedent in that regard? The fact that it is doing so will cause many people to think that the judges receive preferential treatment, compared with the people who are judged. Who are to judge the judges? Are not we members of this Parliament and the community entitled to judge them? That is the question that we should ask ourselves - and answer. At the present time we have an economy based on what I term organized injustice. I do not believe that there has been any increase in real wages. We are told that higher wages are paid today than formerly. That is true on paper, but I remind honorable senators that the real wage is measured by the quantity of the necessaries of life that it will buy. Can anyone seriously contend that there is real justice in Australia today? Thousands of men and women are living under conditions reminiscent of the mediaeval ages. They are denied adequate housing. Many people are living in rooms when they should have proper housing units. The intellectual and moral effects on their children are such that teenage-delinquency is increasing. No attempt has been made to deal with the cause of the present situation. Supporters of the Government assert that the proposed increases of judges' salaries are justified. We are all human beings. Other members of the community are as entitled as we are to proper living conditions. This right is being denied to them, yet supporters of the Government expect them to believe that they are receiving justice. I believe that justice must be based on principles of equity and good concience. When there is no equity among men and women, there is no justice, but only organized injustice in the name of justice, particularly at the instance of legal men and other men who hold the view that **Senator Wright** holds. In his opinion, the judges are deities; they are beyond suspicion. I have the greatest respect for some judgments but not all of them. I judge them on their performance - their judgment. I do not think that judges who interpret the law based fundamentally on injustice, in the name of justice, without pointing out the anomalies, have the knowledge that they are supposed to possess. As I have said previously, a man is not qualified to judge his fellow men unless he possesses at least an elementary knowledge of the science of men - anthropology, biology, history and other aspects of men's lives, enabling him to act, not in comformity with theory only, but in accordance with reality. Of course, some judges do that. I can remember the time when judges ordered men to be flogged. Such a sentence was imposed as recently as about this time last year. I believe that men who order their fellow men to be flogged have very primitive minds and are not qualified to be judges. The bill proposes to increase judges' salaries at a time when thousands of our people are suffering from veritable injustice. I refer particularly to thousands of elderly men and women who, although capable of earning a decent livelihood, are denied the right to do so because it is not profitable for employers to employ them when juniors can be employed to do the work for much lower wages. If this bill becomes law, the impression will be created in the minds of intelligent men and women that the maximum amount of consideration is given to those who occupy highly privileged positions, but only the minimum amount of consideration is given to those who occupy the less privileged or unprivileged positions in the community. On this ground, I believe that the bill should be opposed. If it becomes law, supporters of the Government, when next they face the electors, will be challenged for granting these increases to the judges while at the same time denying justice to the workers. For example, the Government intervened in an application that was made to the Commonwealth Conciliation and Arbitration Commission by certain unions which claimed that wage and margin increases should be granted. The Government's representative stated that increases should not be granted because to do so would cause inflation. The court did not call upon the representative of the Government to define precisely what he meant by " inflation ". Even **Senator Wright** and a number of other legal men have never yet attempted to define exactly what is meant by that term. They speak in vague generalities, which has a misleading effect on people who do not understand the position. Of course, they do not understand it because neither in the schools nor in the universities are we taught about the science of economics. As far back as 1871, John Stuart Mill was writing about education. At that time, compulsory education was being advocated {: .speaker-10000} ##### The PRESIDENT: -- Order! The honorable senator is getting right away from the bill. {: .speaker-L8E} ##### Senator CAMERON: -- I just want to make the point, **Mr. President,** that the men and women who are supposed to be educated and to have certain qualifications, do not really understand the economic position. It was said by John Stuart Mill that the purpose of State and denominational education was to establish despotism over the mind which would ultimately and inevitably establish a despotism over the body. That is the reason that people take advantage of others or, as is attempted in this bill, try to create a false impression in the minds of the people that judges are beyond question and are entitled to receive whatever amount of money it is proposed to give them. I am not one who would deny judges the security to which they are entitled, but I believe that they should not be paid an amount that is considerably in excess of that which is necessary for their economic security, either while they are serving on the Bench or when they retire. I believe that the proposal of the Government to pay judges the salaries referred to in the bill will cause a good deal of dissatisfaction. As has been said, there are highly paid officers in the Public Service. The payment of the salaries that are proposed in the bill is creating dissatisfaction in the Public Service, which has already expressed itself and will continue to do so even more forcibly. Consequently, the Government is forging with this bill a weapon that will be used against it, particularly by people who are suffering because they are denied reasonable quantities of food and clothing, and because they are denied housing and other essentials for themselves and their children. Australia is supposed to be one of the wealthiest countries of the world, but there are hundreds of thousands of such people in the country to-day. Complaints have been made about the lateness of the hour. It is true that the hour is late, but it is not too late for me to protest against the bill. I repeat that the proposed increase of salaries in the present circumstances is a gross injustice perpetrated by this Government at the expense of the unfortunate people who are being denied the justice to which they are entitled and who are the victims of organized injustice which goes under the name of justice. Question resolved in the 'affirmative. Bill read a second time, and passed through its remaining stages without amendment or debate. {: .page-start } page 2272 {:#debate-39} ### JUDGES' REMUNERATION BILL 1960 Bill received from the House of Representatives. Standing Orders suspended. Bill (on motion by **Senator Henry)** read a first time. {:#subdebate-39-0} #### Second Reading {: #subdebate-39-0-s0 .speaker-KOW} ##### Senator HENTY:
Minister for Customs and Excise · Tasmania · LP -- I move - >That the bill be now read a second time. This bill is complementary to the one dealing with the salaries of the judges of the High Court. Its purpose is to increase the salaries of the judges of the Commonwealth Industrial Court, the Federal Court of Bankruptcy, the Supreme Court of the Australian Capital Territory, and the presidential members of the Commonwealth Conciliation and Arbitration Commission. It will establish a basic judicial salary of £7,000 a year for judges of those tribunals, and a salary of £8,000 a year for the Chief Judge of the Commonwealth Industrial Court and the President of the Commonwealth Conciliation and Arbitration Commission. Australia - and I am sure the Senate agrees with me on this point - has the greatest respect for the judiciary and the functions it performs, and knows that it is essential to the maintenance of our democratic way of life that the rule of law, whether it be in the industrial sphere, in bankruptcy administration or in the ordinary administration of justice, should be impeccably observed. This can be achieved only if the judiciary is completely independent, and consists of men of the highest quality and integrity. The salaries of the Commonwealth judges, with which this bill deals, must be such as will enable them to discharge their singular responsibilities with independence and without financial embarrassment and will not be so low as to deter the best-qualified persons from accepting the duties and the personal sacrifices of the Bench. Amongst these sacrifices, in the case of the federal judges, are the interruptions to the family and personal life of the judges necessarily involved in the ambulatory character of Commonwealth courts. When the Government reviewed the salaries of the justices of the High Court, it also looked at the salaries of other federal judges, and was confronted with the same disparity between the present salaries of those judges and the remuneration payable to other public officers of the Commonwealth and State judges to which I referred in my second-reading speech dealing with the salaries of High Court judges. In the industrial sphere, the disparity since 1955, when the present Commonwealth salaries were fixed, is obvious from the table which, with the concurrence of honorable senators, I shall incorporate in " Hansard " at this point. It is as follows: - The allowance payable to the members of the New South Wales Industrial Commission is *in the same* case, in relation to taxability, as are the allowances payable to the judges of the Supreme Court, whereas the whole of the salary of Commonwealth judges is taxable. It will be seen, therefore, that all members of the Industrial Commission of New South Wales are now better paid than any member of the Commonwealth Industrial Court or the Common- Wealth Conciliation and Arbitration Commission. As I mentioned in my second-reading speech on the Judiciary Bill, the Government's view is that judicial salaries should not be altered with great frequency, but on the contrary should be fixed so as to provide a just remuneration over a substantial period, making it possible to disregard changes in the meantime in other salary levels. In particular, in the Government's view, there can be no question, in salaries of this kind, of mere adjustment by arithmetical formula in response to movements in industrial wages or prices. It is the Government's view that the salaries of the judges of the superior courts created by the Parliament should not be less than those fixed for the presidential members of the Conciliation and Arbitration Commission. I have already mentioned the considerations that make necessary an increase in the salaries of the presidential members. Several judges of the Commonwealth Industrial Court at present also hold appointments to the Supreme Court of the Australian Capital Territory, and similar assignments of judges from one Commonwealth court to another may be found to be convenient in future. These considerations make a measure of uniformity desirable as between the various Commonwealth tribunals on the mainland. For the reason I gave when explaining the Judiciary Bill (No. 2), clause 2 of this bill provides that the new salaries shall take effect as from 1st October last. I commend the bill to the Senate. {: #subdebate-39-0-s1 .speaker-KPK} ##### Senator KENNELLY:
Victoria -- This bill provides for an increase in the salaries of the judges of the Commonwealth Industrial Court, the Federal Court of Bankruptcy and the Supreme Court of the Australian Capital Territory, and of the presidential members of the Commonwealth Conciliation and Arbitration Commission. Now that the Senate has passed the Judiciary Bill (No. 2) 1960, I suppose one should say that there is *some* justification for increasing the salaries of the judges of the Federal Court of Bankruptcy and the Supreme Court of the Australian Capital Territory. But when we come to a consideration of the salaries of presidential members of the Conciliation and Arbitration Commission, there is a little difference of opinion. Later I shall quote from one of their judgments. As the presidential members of the Conciliation and Arbitration Commission deal with the basic wage, I suppose they will not mind my referring to their salary or remuneration and saying that at the present time their basic wage is £5,500 a year. The salary of the President of the Conciliation and Arbitration Commission is £6,500 a year. Now it is proposed to raise his salary to £8,000 a year, and that of the presidential members to £7,000 a year. That is not a bad rise - £1,500 a year, or £30 a week, or £6 a day for a fiveday week. {: .speaker-K7Y} ##### Senator Tangney: -- What hours do they work each week? {: .speaker-KPK} ##### Senator KENNELLY: -- I do not know. No doubt they have certain hours. I understand that the commission meets at 10 a.m. and rises at 4 p.m. No doubt they have some study to do afterwards, just as we have. If we do not attend to our homework, we do not make much of a fist of our job. I repeat that that is not a bad rise - £1,500 a year, or £30 a week, or £6 a day for a five-day week. Actually, it is pretty good. I direct the attention of the Senate to the following passage in a judgment delivered by the Conciliation and Arbitration Commission, as reported in the " Industrial Information Bulletin " published by the Department of Labour and National Service in March last - >He said- That is, **Mr. Eggleston-** "The Commonwealth's position in the present case is unambiguously clear. It is that having weighed all considerations which seem to it to be relevant to the present and prospective state of the economy, the Commonwealth is convinced that above all what is needed now is a firm rejection of any new measures that could add to current inflationary pressures, and time for the adjustment of the economy to the general wage increases awarded over the past twelve months." Such a clear statement of the Commonwealth Government's attitude, supported as it is by submissions and economic material, is a matter which the Commission must seriously take into account May I say in passing that when **Mr. Justice** Spicer was a member of the Senate, I thought he was a great man, and I believe that he would perform his duty as Chief Judge of the Commonwealth Industrial Court fairly and in accordance with what he believed to be right. The fact is that the Conciliation and Arbitration Commission rejected the last claim for an increase of the basic wage. If the Government wants the people to have respect for the commission, it cannot knock over the ordinary people for the sake of a few shillings a week and then come along, and put forward a proposal like the one we are now considering. I know that the Government will say that a basic wage rise of 5s. a week would place a tremendous burden on the economy as compared with the cost of these increases, but that is not what counts in the mind of the average person. The average person says to the members of the commission: "We cannot have a rise. Because costs are rising, we have to be content with a little less. You are not doing too badly at the moment, but you are to get another £1,500 a year." The Government is going the wrong way about achieving respect for the commission. I do not want to see people work for less than a reasonable wage; I have never done so myself. I have always believed in selling my labour to the highest bidder. I have never made any bones about that. I point out to the Government that it has never caused an industrial award to be backdated for a week or a fortnight; but now it seeks to backdate these rises to 1st October. Can the Government imagine what I would say if I were in Healy's place? If I were in his place and I could cause the Government a little inconvenience, I would make no bones about doing it. Is it any wonder that some unions want to keep away from the commission and to engage in collective bargaining? The building trades unions are standing the employers up. I do not agree with that, because it raises costs. This bill is outrageous, silly and wrong. It does not get the Government anywhere. It makes the whole show just a laughing stock. We have been told that the economy has a touch of the shakes. Many people with the shakes are cured and I hope that the ills in the economy will be cured. I do not know why the Government persists in this measure. It is treating the people outside as a pack of ninnies, and a lot of them are not in that category. Thank goodness that I shall not be an official of the Waterside Workers' Federation when this measure goes through. I would cause the Government a bit of trouble, but I do not want that to happen. I think the whole business is shocking. The court tells the workers that they cannot get an increase of ls., 2s. or 3s., because if that were done the economy would topple over. I know that the cases are not strictly parallel, but the principle is common to both. I regret that the bill is being presented. I oppose it. A mockery is being made of the whole show of wage and salary adjustments. This proposal will not enhance the position of the court and it will not assist those people who are trying to keep the workers happy. Once the workers get the bit in their teeth it is hard to restrain them. The measure is wrong. We oppose it, but the Government has the numbers to pass it. Question resolved in the affirmative. Bill read a second time, and passed through its remaining stages without amendment or debate. {: .page-start } page 2275 {:#debate-40} ### SNOW MOUNTAINS HYDROELECTRIC AUTHORITY BILL 1960 Bill returned from the House of Representatives without amendment. {: .page-start } page 2275 {:#debate-41} ### QUESTION {:#subdebate-41-0} #### BERYLLIUM {: #subdebate-41-0-s0 .speaker-K5K} ##### Senator SCOTT: asked the Minister for National Development, upon notice - {: type="1" start="1"} 0. Is the metal manufactured from beryllium becoming very important because of its high heat resistant dualities? 1. Is the ore known as beryl in short supply? 2. Has the Minister any information on the new device called a berylometer which is being used in America for locating sub-surface ore? 3. Is this new device being used in Australia; if not, can the Minister advise on its cost and availability? {: #subdebate-41-0-s1 .speaker-K7A} ##### Senator SPOONER:
LP -- I now furnish the following replies: - {: type="1" start="1"} 0. The metal beryllium combines lightness with substantial strength, has a high melting point and has favorable nuclear properties for use in atomic reactors. Important potential non-nuclear applications of the metal are fabrication of the nose cones of missiles, the skins of supersonic aircraft, the air intake, surfaces and exhaust outlets of jet engines. In the field of design of nuclear reactors the metal beryllium and its oxide beryllia, show promise as canning materials for fuel, moderators, fuel diluents and structural materials. The use of beryllium and beryllia should contribute to reduction in both capital and operating costs of nuclear power stations. 1. World production of beryl, the ore from which beryllium is extracted, has always been small and in 1959 was 7,400 tons. The United States imported 6,200 tons - about 70 per cent, of the world's production. Consumption in the United States may now be as high as 7,500 tons of ore per annum. If the use of beryllium and beryllia increases substantially new sources of supply will have to be exploited. 2. The berylometer is a newly-developed instrument which detects beryllium by registering in a manner similar to a geiger counter, its reaction to radiation emitted from the instrument. It can also be used for assaying samples of rock believed to contain beryllium on the spot in the field. It will only detect beryllium at a depth of a few inches below the surface of the ground but the instrument has already been used with some success overseas. 3. One large mining company in Australia is already using a berylometer in its exploration programme and it is known that several other companies have been considering the possibility of purchasing instruments of this type. One model manufactured in Canada weighs 25 lb. and must be suspended from a pole eight feet long carried by two men. It costs about 2,500 dollars. A similar machine is manufactured in the United States and is available on one month's delivery. An instrument working on the same principle but different in some details is also available from the United Kingdom for about £875 sterling. {: .page-start } page 2275 {:#debate-42} ### QUESTION {:#subdebate-42-0} #### DUTCH NEW GUINEA {: #subdebate-42-0-s0 .speaker-KUD} ##### Senator McMANUS: asked the Minister representing the Minister for External Affairs, upon notice - {: type="1" start="1"} 0. What information has the Government on reports of a landing in Dutch New Guinea by a force of alleged Indonesian irregulars? 1. If the reports are correct, has the Government any action in mind to ensure that this landing does not develop so as to threaten peace in any area of vital concern to Australia? {: #subdebate-42-0-s1 .speaker-KH5} ##### Senator GORTON:
Minister for the Navy · VICTORIA · LP -- The Minister for External Affairs has supplied the following answers: - {: type="1" start="1"} 0. The Government has information from various sources on this landing. The situation has been summarized by the Netherlands Government in two statements by the Netherlands Ministry of Home Affairs. On 21st November it announced that a small armed group of Indonesians landed on the south-west coast of Dutch New Guinea in mid-November and some were apprehended. On 29th November, it announced that the Dutch Navy had intercepted and apprehended in waters around Dutch New Guinea an Indonesian vessel which was intended to supply an earlier group of infiltrators. There have been several press reports of official Indonesian statements on these matters. The most recent of these reports available to the Government quotes an official spokesman of the Indonesian Navy as stating on 2nd December that " so far asI know the Indonesian armed forces have never conducted infiltration into " Netherlands New Guinea. 1. In addressing itself both publicly and privately to these matters and to public references to the possibility of an armed clash between Indonesia and the Netherlands, the Government has been concerned that no threat to the peace should develop. {: .page-start } page 2276 {:#debate-43} ### QUESTION {:#subdebate-43-0} #### ATOMIC WEAPONS {: #subdebate-43-0-s0 .speaker-K6P} ##### Senator BROWN: asked the Minister representing the Minister for External Affairs, upon notice - {: type="1" start="1"} 0. Has the Government any information on the development of the nuclear bomb in mainland China? 1. If so, can the Minister inform the Senate how far the mainland Chinese have gone towards the successful production of the bomb? 2. Has Russia a weapon similar to the American "Polaris" missile? {: #subdebate-43-0-s1 .speaker-KH5} ##### Senator GORTON:
LP -- The Minister for External Affairs has supplied the following answer: - 1 and 2. Communist China has been engaged since about 1955 in a research and development programme for the peaceful application of nuclear energy which could have military applications. Statements by Chinese political and military leaders have revealed an intention to develop atomic bombs, but I am not aware of any claims that they have yet done so. Without discussing in detail our knowledge of the work being done in this field by Communist China, it can be said that if the Communist Chinese were to give a sufficiently high priority to the project they could probably develop a nuclear weapon within from five to ten years from the date when they decided to proceed with its development. {: type="1" start="3"} 0. **Mr. Khrushchev** has, on separate occasions, claimed that the Union of Soviet Socialist Republics has both nuclear powered submarines and submarines armed with guided missiles. Other developments in nuclear marine propulsion, (e.g., the nuclear icebreaker " Lenin ") and rocketry suggest that these claims may well be true but, so far as is known, he has not claimed that the Union of Soviet Socialist Republics has developed a missile capable of being fired from a submerged submarine. {: .page-start } page 2276 {:#debate-44} ### LEAVE OF ABSENCE Motion (by **Senator Spooner)-** by leave - agreed to - >That leave of absence be granted to every member of the Senate from the termination of the sitting this day to the day on which the Senate next meets. {: .page-start } page 2276 {:#debate-45} ### SPECIAL ADJOURNMENT Motion (by **Senator Spooner)** agreed to- >That the Senate, at its rising, adjourn till a day and hour to be fixed by the President, which time of meeting shall be notified to each senator by telegram or letter. {: .page-start } page 2276 {:#debate-46} ### ALUMINIUM INDUSTRY BILL 1960 Bill returned from the House of Representatives with an amendment. In committee (Consideration of House of Representatives' amendment). House of Representatives' amendment- >After clause 10, add the following new clause :- " 11. The Consolidated Revenue Fund is appropriated to the extent necessary for the purpose of the making by the Commonwealth of payments required to be made by section five of this Act and any payments that the Commonwealth is liable to make by reason of the operation of the last preceding section.". {: #debate-46-s0 .speaker-K7A} ##### Senator SPOONER:
Vice-President of the Executive Council and Minister for National Development · New South Wales · LP -- I move - >That the amendment be agreed to. I remind the Senate that the undertaking is being sold under contracts to a company being formed, in which the Tasmanian Government has a one-third interest, the other parties holding a two-thrrds interest. In terms of the contract of sale, the purchase price is payable by a deposit and instalments over a period of years. That purchase price is to be distributed between the two governments on a formula related to their respective capital interests. From memory, to the Commonwealth. It is necessary for the Commonwealth to account to Tasmania for the proportions which belong to each and for the Parliament to make an appropriation to give authority for those moneys to be paidover. It is not within the power of the Senate to originate a bill for that purpose. We adopted the procedure of putting the bill with the main provisions through the Senate first, because I was the responsible Minister and was able to explain its complexities. The bill then went to the House of Representatives. That being the House with authority to make an appropriation, the necessary amendment was made to give the Commonwealth power to pay to Tasmania the amount to which it is entitled. The amendment has now come back to us for incorporation in the bill. Amendment agreed to. Resolution reported; report adopted. {: .page-start } page 2277 {:#debate-47} ### VALEDICTORY {: #debate-47-s0 .speaker-K7A} ##### Senator SPOONER:
New South WalesVicePresident of the Executive Council and Minister for National Development · LP -- by leave - I think we have reached an appropriate time at which to extend to each other Christmas greetings. I start first with you, **Mr. President.** I pay you my tribute, that of the Government parties and, indeed, I would hope, that of the Senate as a whole for the manner in which you have carried out your responsibilities during the year. I pay that tribute sincerely. I say with respect that you have held your high office with dignity to yourself and credit to all of us here. I extend felicitations to the Chairman of Committees, who is hiding his light behind a bushel in the corner seats. As I have often said, he is perhaps the most experienced parliamentarian of us all. As a Minister I always look forward to seeing him in the chair when we are dealing with a complicated piece of legislation which requires firm control and which demands reasonably quick action. I thank my Cabinet colleagues, if any of them survive with me at this late hour, for their assistance during the year. I also thank all other honorable senators who sit behind me. I find it hard to choose the appropriate words of thanks for the loyalty and support that I have had from my team. I appreciate that loyalty and support very much indeed. Although I express my thanks in formal words, the formal words do not convey the friendship that I feel for all of you and the thanks that I extend to you for what you have done. Of course I particularly thank my Deputy Leader. I have had a good mate. If at this Christmas of 1960 we know a little more about the Standing Orders than we did at Christmas 1959 it is not surprising, remembering the gaps in our knowledge twelve months ago. 1 extend season's greetings to the Leader of the Opposition **(Senator McKenna)** and those who sit behind him. Oh . . . that mine adversary had written a book! Never say a good word about your political opponents. If you do, at some critical stage you will be confronted with that good word. However, I will break the golden rule and say " Merry Christmas " to the Leader of the Opposition in particular, because a parliament cannot work unless the Leader of the Opposition and the Leader of the Government have confidence in each other and can together work out the machinery things that must be worked out so that the Parliament may run effectively. I say " Thank you " to **Senator McKenna** for the way in which he has helped me during the year. We have worked together. We have talked together. I do not remember an occasion when really in our hearts we had a bitter thought, although we may have said a few bitter words here. I say " Thank you " to the press - to such of its members as survive at five minutes past two in the morning. I said to pressmen at lunch time yesterday that in the last year I think we in the Senate have had better reporting in the newspapers than we had in the previous year. Of course, none of us gets the space in the newspapers to which he is entitled. We could not expect to get it. I think that this year the Senate has had more dignified, accurate and amplified reporting than it has had in any previous year. So 1 say to the gentlemen of the Fourth Estate: " Happy Christmas to you all. May the fishing be as good for you during the holidays as I hope it will be for the rest of us." Rather low in the list, for some unknown reason, come the officers of the Parliament - the Clerks at the table, the Parliamentary Draftsman, the " Hansard " reporters, who conceal all our deficiencies, and the Senate attendants. This year, more than in previous years, I have been put in the position of realizing the wisdom of the Clerks at the table and the knowledge that they have. It is incomprehensible to me that anybody should understand the Standing Orders. We devote out attention to them and the more we do so the more confused we become. This year I have found that I have had to lean very heavily on **Mr. Loof** and I thank him for the help that he has given to me. I say "Thank you " to all of you who have helped the Government senators and the Opposition senators in the work to which we have set our hands and which, in the innocence of our hearts, we believe to be of great national inportance. {: #debate-47-s1 .speaker-KTN} ##### Senator McKENNA:
Leader of the Opposition · Tasmania -- by leave - On behalf of the Opposition I should like to subscribe very sincerely to every word that the Leader of the Government said in relation to you, **Mr. President,** and the distinction with which you occupy your office. I extend those remarks to the Chairman of Committees, who is also our Deputy President. If I were to draw distinction between the President and the Deputy President 1 should say that the art of brinkmanship was far more dangerous in the case of the Deputy President than in the case of the President. I extend to all Ministers and Government senators the compliments of the season. I trust that they enjoy the recess. The sessional period has been leng and arduous and inevitably in the closing stages tempers became a little frayed. But that is all that ever really happens. I know, and I think everybody else in the chamber knows, that there is a very high degree of really sincere personal cordiality between the Government and the Opposition. 1 extend to all Government supporters and to my Deputy Leader and our supporters my best wishes. I thank them for their co-operation throughout the session. We have received great co-operation from the Government. To all the other people mentioned by **Senator Spooner** I extend the Opposition's compliments and good wishes. All persons and every class of persons that he mentioned are complely indispensible to the proper functioning of the Senate. It is amazing how wonderfully well the place runs. I hope I shall be excused for not naming all those people, but everybody will understand that I support **Senator Spooner** in all that he said. I am looking forward1 to a spell, as I trust everybody else is. **Mr. President,** on behalf of the Opposition I thank the Leader of the Government for his good wishes and I extend my good wishes to everybody. The **PRESIDENT (Senator the Hon. Sir Alister McMullin)** - Honorable senators, I thank the Leader of the Government in the Senate **(Senator Spooner)** and the Leader of the Opposition **(Senator McKenna)** for the very kind remarks that they have made about me. I thank them very much for the sincerity with which those remarks were uttered. I should like to say to you, honorable senators, that I feel a deep debt of gratitude to you for the assistance you have given me during the year and for the pleasant way in which we have worked together. You have made it possible for me to take part in other activities to which, in my humble way, I tried to make a contribution. I hope that I have been successful. My participation in these activities would not have been possible had it not been for your ready cooperation in permitting me to go away during the time when the Senate was sitting. In that regard, I appreciate what the Chairman of Committees has done during my absence and also the work of the temporary chairmen of committees who carried on the good work while I was away at various conferences. I thank you very much and very sincerely for that. At this time I should like to extend our felicitations to some of the people who have been mentioned in a general way. They are the unseen workers around Parliament House. I refer to the people who work in the kitchen, the workshops and other places, who play their part very effectively in carrying on the work of this Parliament. They should not be forgotten because they are not seen, and I am sure that honorable senators appreciate the part they play in the general running of the Senate. The loyalty I have received from the officers of the Senate, down to the most junior officer, has always been a source of great pleasure to me. I am also aware of the part that the officers of the Library have played in the year's work, and I look forward to the Library of the future being even more valuable to you, honorable senators, than it has been during the years that have passed. I thank you all very much. It has been very pleasant to work with you and I want you to know that I appreciate all that you have done for me during the year. Senate adjourned at 2.15 a.m. (Friday) till a day and bour to be fixed by the President.

Cite as: Australia, Senate, Debates, 8 December 1960, viewed 22 October 2017, <http://historichansard.net/senate/1960/19601208_senate_23_s18/>.

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