Senate
15 May 1963

24th Parliament · 1st Session

  1. Senate
  2. 24th Parliament
  3. 1963

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

page 429

QUESTION

TRADE

Senator KENNELLY:
VICTORIA

– I direct a question to the Minister representing the Minister for Trade. Has the Minister seen reports that Great Britain has already secured Australian and New Zealand agreement to suspending tariffs on butter imported into Great Britain? Are these reports correct? If so, why did Australia agree to the suspension of these tariffs? What effect will such suspension have on our butter exports to Great Britain?

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

– I have noticed reports on the agreement of the Australian Government to forgo the preference of 15s. a cwt. on butter; but there were conditions attached to that agreement, and as the honorable senator has evinced interest in this matter perhaps I should read those conditions. First, the British Government will consult with the Australian Government in the course of each year about the total quantity of butter that may be imported by Great Britain during the year. Secondly, the British Government will continue to allocate to Australia not less than its present proportional share of the total permitted imports and, except as may be agreed by the Australian Government, a minimum of not less than the quantity allowed to be imported from Australia under the existing quota. Thirdly, the British Government does not intend to depart from its present policy of not encouraging the expansion of milk production in Britain for manufacturing purposes. It is not without interest to the Senate that the price of Australian butter in Great Britain prior to this system of import quotas was 247s. sterling a cwt., but that since the introduction of import quotas the price has been steady at 314s. sterling a cwt.

page 429

QUESTION

SHIPPING

Senator MARRIOTT:
TASMANIA

– My question is directed to the Minister representing the Minister for Shipping and Transport. Although it has been announced that the new passenger-cargo ship which is being constructed for the Australian National Line to trade between Sydney and Tasmania is to be named “ Empress of Australia “ will the Minister ask his colleague, the Minister for Shipping and Transport, to consider changing the name to “ Lady Nelson “? In the early history of Australia a ship, “ Lady Nelson “, was associated with the settlement of ports in Tasmania, New South Wales and Victoria. Will the Minister inform his colleague that the name “ Lady Nelson “ would be more suitable and more widely approved? Will he also note that there is a Canadian shipping line which includes the now obsolete term “ Empress “ in the names of all its ships?

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

– I shall refer the question to my colleague, the Minister for Shipping and Transport, but I should think that the name of a ship under construction having been announced, only a most unusual circumstance would lead to its being changed. I am sure the honorable senator is well aware that certain conventions apply to the naming of vessels. For example, the “ Princess of Tasmania “ was so named because it had become a convention in the shipping world to use the word “ Princess “ in naming ships of that type. Possibly something of that nature exists in relation to the naming of the new vessel “ Empress of Australia “. As I said, I shall refer the matter to my colleague.

page 429

QUESTION

TELEVISION

Senator BENN:
QUEENSLAND

– My question is addressed to the Minister representing the Postmaster-General. Under the rationalization scheme that is applicable to two wellknown airline organizations, will the Postmaster-General recommend to the Australian Broadcasting Control Board that Trans-Australia Airlines be granted the third television licence for a station at Brisbane?

Senator WADE:
Minister for Health · VICTORIA · CP

– I should have thought that the honorable senator would be well informed on the procedures that have been adopted by the Government in the allocation of television licences. He will recall that the Government, in its wisdom, has decided that there shall be one, two or three commercial television stations in the various capital cities and in rural areas, as the case may be, and, having made that decision, it has forthwith proceeded to call for applications for licences. The Government has referred those applications to a completely independent board and the board’s recommendations have invariably been accepted.

page 430

QUESTION

WHEAT

Senator MCKELLAR:
NEW SOUTH WALES

– Just recently, I asked the Minister representing the Minister for Primary Industry whether he could tell the Senate if the whole of the last season’s wheat crop had been sold. At that point of time he was not able to give me an answer, but 1 believe that he may now be able to do so. Has he the information?

Senator WADE:
CP

– Yes, I have that information. At 27th April, 1963, 157,000,000 bushels of the 1962-63 season’s wheat crop remained for sale. This included about 55,000,000 bushels which were needed for local use for the rest of the season and for the usual carry-over. The interesting point is that all of the 1961-62 season’s wheat crop has been sold.

page 430

QUESTION

CIVIL AVIATION

Senator POKE:
TASMANIA

– Will the Minister for Civil Aviation inform the Senate of the increase in traffic through the Wynyard and Pardoe airports during the past two years? Is the Minister aware that considerable congestion occurred at each airport during the past week-end? If he is not so aware, will he obtain a report from his departmental officers about alleged overcrowding in the existing airport terminals? Can the Minister tell the Senate whether or not passenger and cargo traffic has increased sufficiently to warrant the installation of night-landing facilities at Wynyard? ls he aware that failure to display the names of the Wynyard and Pardoe airports causes considerable confusion to incoming passengers? Will he have the position corrected at the earliest possible moment?

Senator PALTRIDGE:
LP

– Senator Poke was good enough to indicate to me that he intended to ask that part of the question which relates to traffic congestion, and I have been able to get some information for him. Last year, the Wynyard airport handled 28,385 passengers compared with 26,386 in 1961, an increase of 7.6 per cent. The Pardoe, or Devonport, airport handled 33,012 passengers in 1961 and 34,599 last year, an increase of 4.8 per cent. I am not aware that any congestion occurred at these airports during the past week-end. I am informed that in normal circumstances they handle the traffic quite well but that some temporary crowding can occur at times because of special flights and diversions.

The Wynyard airport has no night landing facilities other than the normal flare path, which can be laid in an emergency. The provision of night landing facilities at any aerodrome depends on traffic available, finance, and whether the airlines themselves want to operate night services. My department has no firm proposals from the airlines stating that they want to operate night services into Wynyard. If and when we do receive a request, it will receive proper consideration.

Senator Poke:

asked that the names of Wynyard and Pardoe airports be prominently displayed. I said in answer to a question directed to me yesterday by Senator Tangney in relation to Perth airport, that ] did not think that the display of the name would have any functional benefit. I acknowledge that the situation is not the same in Western Australia as in Tasmania and that the closeness of the airports in Tasmania to one another may cause confusion, especially when passengers are strangers to the places. No proposal for the display of the names is at present being considered, but as the relevant works programmes come under consideration. I shall keep the suggestion in mind and examine it.

page 430

QUESTION

PHOSPHATE

Senator SCOTT:
WESTERN AUSTRALIA

– My question to the Minister for National Development relates to the great phosphate deficiencies in the higher rainfall area of the Northern Territory. Can the Minister advise me of the significance of last year’s discovery of phosphate deposits in the Territory?

Senator Sir WILLIAM SPOONER:

–

If last year’s discovery had led to the establishment of commercial deposits of phosphate, it would have been of very great significance to Australia and New Zealand. Although the deposit has been discovered, as yet insufficient drilling work has been done to indicate the size and quality of the deposit, so we are still, as it were, in a state of suspension, waiting to learn the importance of the discovery.

page 431

QUESTION

BUTTER

Senator O’BYRNE:
TASMANIA

– 1 should like to preface my question, which is directed to the Minister representing the Minister for Primary Industry, by referring to the changing relationship between the United Kingdom and Australia with regard to our butter exports. In view of the answer given by the Minister in another place to a question as to whether the Australian Dairy Produce Board had suggested to him a method of controlling butter production, and particularly in view of to-day’s announcement of a changing arrangement with the United Kingdom, which could have considerable repercussions upon Tasmanian dairy farmers and butter producers, I ask whether any arrangement has been made for calling a conference of State Ministers for Agriculture to meet this problem. If it has not, will an early conference be called to deal with this quite serious situation?

Senator WADE:
CP

– I think that my colleague dealt adequately with the points raised by Senator O’Byrne, with the exception of his request for a conference. I shall discuss very briefly just one point that Senator Henty made on this new arrangement. I think he emphasized that Australia was prepared to agree to the suspension of the preference of 15s. a cwt. while the present quota system was in operation. Those are the operative words. The Australian dairy industry, I am sure, accepts that as being in the best interests of the industry. Mr. Roberts, the chairman of the Australian Dairy Produce Board, has been in London while these negotiations have been taking place. He has made his services available to the Minister for Trade and he has expressed himself as being satisfied that the decision taken is in the best interests of the dairy industry. The Minister has reminded mc that since quotas have been imposed in the United Kingdom the price of Australian butter has risen from 247s. to 314s. a cwt. I am sure that the dairy industry would be far more happy to have a set quota at a payable price than to be subject to marketing conditions in the United Kingdom which were susceptible to the dumping of cheap butter. I suggest to Senator O’Byrne, who thinks a nearcrisis has arisen, that the position is not as he considers it to be. The chairman of the

Australian Dairy Produce Board, in his wisdom, has supported this agreement and has expressed himself as being satisfied with it.

page 431

QUESTION

INDUSTRIAL UNREST

Senator WEDGWOOD:
VICTORIA

– I direct a question to the Minister representing the Minister for Labour and National Service. Has his attention been directed to a report that the freighter “Persic” left 10,000 cartons of canned fruit and 3,000 boxes of butter behind when she sailed for England yesterday? Is it a fact that 4,300 waterside workers will hold a four-hour unauthorized stop-work meeting in Melbourne to-day? What course is open to the Government to put a stop to direct action of this kind and to the losses that are consequent upon it?

Senator GORTON:
Minister for the Navy · VICTORIA · LP

– I understand that the figures stated by the honorable senator are correct so far as they go. They do not, of course, give the full extent of the losses which have been caused to Australia’s export -trade by the time which has been lost on the waterfront in recent weeks. The part of the question which relates to tha action open to the Government perhaps verges on matters of policy. The Minister for Labour and National Service, in response to questions on this subject which have been asked in another place, has stated quite clearly that one of the great disappointments in this field and one of the great difficulties which is leading to disruption of Australia’s export trade, to the joy only of such Communist elements as there may be in the Waterside Workers Federation, is the fact that, although concessions have been made to the industry and the field of arbitration has been left open to it, the union has not taken advantage of arbitration but has indicated that it will accept from the arbitrators only those decisions which accord with its own wishes. As I have said, the action to be taken is a matter of policy.

page 431

QUESTION

UNITED NATIONS

Senator COLE:
TASMANIA

– My question is addressed to the Minister representing the Minister for External Affairs. In view of the critical financial situation threatening the continued existence of the United Nations, will the Minister consider the advisability of instructing the Australian delegate to move for the suspension of membership of all nations which persist in refusing to meet their financial obligations?

Senator GORTON:
LP

– As the honorable senator no doubt knows, the World Court recently held, in an advisory opinion and not in an opinion on arbitration as between two contestants, that contributions to the expenses of the United Nations for such purposes as the Congo operation were properly to be regarded as expenses of the organization, and that, therefore, countries which were in arrears in their payments towards those expenses were properly and justly obliged to pay them. The Charter of the United Nations, I understand, indicates that nations which are in arrears in their just and proper payments should not be entitled to have a vote while they are in arrears, should the General Assembly so decide. I speak subject to correction, but I do not believe that provision is made for suspension of a member nation or for removal of any kind, but the Charter definitely provides for the withholding qf the vote. I shall bring to the attention of the Minister for External Affairs the suggestion made by the honorable senator.

page 432

QUESTION

FRUIT FLY

Senator BUTTFIELD:
SOUTH AUSTRALIA

– My question is directed to the Minister representing the Minister for Trade. Is it a fact that Japan will not accept fresh fruit, particularly citrus fruit, from Australia because areas in Australia are subject to fruit fly infestation? Is it possible to guarantee that some areas in which export citrus fruit is grown are fly-free areas? Has any attempt been made by the Australian Government to negotiate the acceptance by Japan of fruit if the Government can guarantee that it has come from a fly-free area?

Senator HENTY:
LP

– The question comes rather within the jurisdiction of the Minister for Health who administers the quarantine regulations, but I believe that what the honorable senator said is correct. Japan has placed an embargo at the present time on citrus fruits from areas in Australia in which the fruit fly is in existence. 1 do not know what work has been done in endeavouring to locate areas which are free of fly. I will have the position examined if the honorable senator will put her question on the notice-paper,

page 432

QUESTION

PENSIONER MEDICAL SERVICE

Senator COOKE:
WESTERN AUSTRALIA

– My question is addressed to either the Minister for Health or the Minister representing the Minister for Social Services. Is the Minister aware that the means test applying to free hospital and medical treatment for pensioners was fixed more than a decade ago? Has the Minister had information, and is he mindful of it, that hospital and medical costs have increased at least 100 per cent, since that time and are causing embarrassment not only to hospitals and State authorities but also to pensioners who are subject to this thoroughly antiquated means test? Will the Minister assure the Senate that the means test will be revised in favour of pensioners and that the permissible income and assets will be increased in order to relieve real hardship and suffering that are faced by pensioners when they become ill and have to receive hospital and medical treatment? Very often they are unable to pay their bills and need to have them written off by State authorities.

Senator Sir WILLIAM SPOONER:

– I agree that the present arrangements have been in existence for a long time but, of course, a lot has happened during that time. The rate of pension has been increased substantially. My colleague the Minister for. Health has pioneered and introduced medical benefit and hospital benefit schemes. All this makes the picture different from that presented by Senator Cooke. I am sure that the matter will be looked at - as is the case with all social service benefits - during the preparation of the Budget.

page 432

QUESTION

NATIONAL DISASTER FUND

Senator TANGNEY:
WESTERN AUSTRALIA

– My question is directed to the Leader of the Government in the Senate or other appropriate Minister. In view of the tragic floods in various parts of eastern Australia, resulting in loss of life, damage to property and loss of national and personal income, will the Minister consider establishing a national disaster fund for the relief of flood, bushfire and cyclone victims throughout Australia?

Senator Sir WILLIAM SPOONER:

– I have a clear recollection that Senator Tangney has asked me this question previously.

Senator Tangney:

– Several times, unfortunately.

Senator Sir WILLIAM SPOONER:

–

This is a matter which has been exhaustively examined from time to time, not only by the Commonwealth Government but by State governments as well. The verdict has always gone against the practicability of inaugurating such a fund. I cannot think off-hand of all the reasons that have been given, because it is a fairly complex question. One of the main objections is the strong disinclination of people who are in areas not subject to flooding to agree to the establishment of a fund. They claim that in the purchase and acquisition of properties people take into account that the areas are subject to flooding.

Senator Tangney:

– Yet people give generously to funds.

Senator Sir WILLIAM SPOONER:

– I know it is a big matter that applies not only to floods but also to bush fires and other disasters with natura] causes. People say that if help can be given to repair war damage in war-time it can be given in peace-time, but I find that when this suggestion is examined the weight of argument does not support it.

page 433

QUESTION

SIREX WASP

Senator MCKELLAR:

– My question is directed to the Minister in charge of the Commonwealth Scientific and Industrial Research Organization. What is the latest position with regard to the sirex wasp?

Senator GORTON:
LP

– This matter is partly within the scope of the administration of my colleague, the Minister for Health. The latest report that I have heard with regard to the sirex wasp is that the work which is being carried out by State departments, particularly in Victoria, South Australia and Tasmania, in combating the pest in areas where it has lodged itself and on research into methods of finally getting rid of it, is encouraging. I cannot say any more than that at the moment. I will endeavour to find out the latest position and inform the honorable senator. I do not know whether my colleague has something to add to what I have said.

page 433

QUESTION

SOLDIER SETTLERS ON KANGAROO ISLAND

Senator BISHOP:
SOUTH AUSTRALIA

– My question is directed to the Minister representing the Minister for Primary Industry. On 28th November, 1962, I asked the Minister a question concerning pioneering disabilities of soldier settlers on Kangaroo Island. Is the Minister in a position to report upon or to indicate the extent of any Commonwealth assistance to the 160 soldier settlers arising from the Minister’s discussion with them on 9th November, 1962?

Senator WADE:
CP

– I must confess that I am not in a position to supply the information now, but I undertake to do so without delay.

page 433

QUESTION

PUBLIC SERVICE

Senator SANDFORD:
VICTORIA

– My question is directed to the Leader of the Government in this House and it is prompted by an answer to a question by Senator McClelland in which he asked how many officers had resigned from the Commonwealth Public Service in the last two years. The reply was that in the year ended 31st December, 1961, 4,119 officers resigned, and that in 1962, 4,079 officers resigned. My question is: How do these numbers in 1961 and 1962 compare with resignations from the Commonwealth Public Service in 1959 and 1960?

Senator Sir WILLIAM SPOONER:

– I will have to ask the honorable senator to put the question on the notice-paper because I cannot carry such details in my mind. I think the honorable senator could appropriately have asked the following question as well: -

How does this number of resignations compare with the total number of public servants?

I do not think it is a great proportion. Perhaps a further question could appropriately be added, as follows: -

What were the recruitments of the Commonwealth Public Service during those years?

page 433

QUESTION

HOUSING FINANCE

Senator ORMONDE:
NEW SOUTH WALES

– My question is directed to the Leader of the Government in the Senate. Has the honorable senator seen the Australian Mutual Provident Society’s advertisement in to-day’s newspapers announcing that the society has assets of over £602,000,000, that its assets are increasing at the rate of £1,000,000 a week and also that new business amounts to £1,000,000 a day? Is it a fact that only a very small proportion of this vast sum of money finds its way into housing loans in Australia? Can the Minister suggest any way by which we can interest such a vast financial organization as the A.M. P. in doing something to help us with our housing problem?

Senator Sir WILLIAM SPOONER:

– I did not see this morning’s advertisement but I do not doubt the accuracy of the figures that Senator Ormonde has given. I speak only from memory but I would think that the Australian Mutual Provident Society is a good supporter of the Australian housing programme. I think the society makes substantial advances for housing, but, holding the portfolio that I do, I say that however good may be the advances (hat it makes, I should like to see more made available. 1 doubt very much whether ways and means can be evolved which would result in the directors of a big mutual co-operative society such as this making other than what they regard as appropriate advances for housing.

Senator WRIGHT:
TASMANIA

– I wish to ask the Leader of the Government a question on a subject related to that on which he has just spoken. I ask him whether or not theannual report of the life assurance commissioners for the year ended 31st December, 1962, does not show that the life assurance companies of Australia devoted to housing last year £157,000,000, representing 13.01 per cent, of their premium income. Is it not a sad fact that they devoted only £25,800,000, representing 2.14 per cent, of their premium income, to rural loans? Will the Government give emphatic encouragement to the view that greater support should be forthcoming from the life assurance offices for loans to the rural community?

Senator Sir WILLIAM SPOONER:

– I have not seen the report to which Senator Wright has referred but he has confirmed my impression that the life assurance companies are substantially supporting the housing programme. Senator Wright’s strong advocacy of rural loans, which is to be expected of him, reinforces the sort of answer that I gave to Senator Ormonde to the effect that it is rather difficult to tell organizations such as this the specific direction in which they should make their investments from time to time.

page 434

QUESTION

CANCER

Senator FITZGERALD:
NEW SOUTH WALES

– Can the Minister for Health advise the Parliament whether any action has been taken or will be taken b’y Australian medical authorities to test the drug which a Russian cancer specialist has claimed can cure malignant cancer tumours?

Senator WADE:
CP

– I have a note from my department on this very drug. I thought that my friend, Senator Brown, would be particularly interested to raise this matter to-day. I am disappointed that he has been by-passed. My department has informed me as follows: -

Much research into the cure of cancer is going on throughout the world and many avenues of treatment are being explored. The use of drugs is one of these avenues. Unfortunately the effects of drugs are rather unpredictable and there are commonly unpleasant side effects. Most drugs have been found to be only palliative but claims of cures have occasionally been reported. Many cases and many years of intensive and controlled work are required before such claims can be substantiated.

The drug referred to by Senator Fitzgerald is sarcolysine and is also known as melfalan and alkeran. Referring to this drug, my department’s report continues -

Sarcolysine … is one of the drugs which has been investigated in various countries, lt was first produced in 1954 and has been used in the fight against leukaemia and inoperable cancer. As far as is known it has not been used in Australia, though for many years other drugs have been used in Australia for the same purpose.

page 434

QUESTION

AIR SEARCHES

Senator BRANSON:
WESTERN AUSTRALIA

– Is the Minister representing the Minister for Air aware that recently, in Western Australia, there was an intensive air, sea and land search for the survivors of the trawler “ Nor 6 “? Does the Minister agree with the criticism in the leading article in the “ West Australian “ of Tuesday, 14th May, which stated that it was a cause for public concern that the Royal. Australian Air Force had only one suitable aircraft available for the search? Does he agree with the statement in this article that it should be a charge against the R.A.A.F. to supply most of the aircraft used in such searches?

Senator WADE:
CP

– Answering the last portion of the question first, I do not think it should be contended that the provision of aircraft for search and rescue is primarily the responsibility of the Royal Australian Air Force. Honorable senators on both sides of the House will readily agree that in times of emergency the R.A.A.F. operates a magnificent service without hope or expectation of reward. If the persons in distress are in a position to pay they may be asked to meet a portion of the costs, but if they are not in a position to do so the R.A.A.F. makes its contribution in the public interest. I do not think it should be contended that the R.A.A.F. should be required to station aircraft for this purpose in various parts of the Commonwealth with its vast land mass. The prime responsibility of the R.A.A.F. is to defend Australia, and if ever its efforts are dissipated on other activities the service will not be as effective as it should be in time of emergency.

page 435

QUESTION

CIVIL AVIATION

Senator KENNELLY:

– Has the Minister for Civil Aviation received any indication from Trans-Australia Airlines that that organization, due to lack of statutory authority to engage in certain categories of operations, cannot take full advantage of the helicopter charters offering? If so, has the Minister considered granting statutory authority to enable the airline to engage in such work? This may mean an amendment of the 1946 legislation.

Senator PALTRIDGE:
LP

– I do not think I have seen the statement to which the honorable senator has referred.

Senator Kennelly:

– I think it was in the last report of the Australian National Airlines Commission.

Senator PALTRIDGE:

– I was about to say that 1 thought I had seen some reference to it in the report. The airline operations of Trans-Australia Airlines are governed by the act. T.A.A. is empowered to conduct an airline service and services incidental thereto. The other restrictions in respect of prohibition of intra-state carriage flow from the act. This has always been the position concerning operations by T.A.A. No restriction has been placed by this Government on helicopter operations, and in this respect the powers of T.A.A. are much the same as those it held when the Labour Government was in office.

Senator Kennelly:

– They have been changed of course.

Senator PALTRIDGE:

– I agree that many things have been altered. One significant thing which might have escaped the honorable senator is that the authority to operate helicopters has not been changed. The airline might have secured helicopters knowing that their use would be restricted by the provisions of the act.

page 435

QUESTION

PASSION FRUIT

Senator BUTTFIELD:

– M y question is directed to the Minister representing the Minister for Trade. Can the Minister inform the Senate how the passion fruit, which is so well known in Australia but not so well known outside this country, got its name? Is he aware that this name militates against the demand for passion fruit in many countries, even Great Britain and the United States of America? Will the Minister undertake to persuade the growers and consumers in Australia to change the name of this fruit and will he then offer such assistance in promoting its sale overseas that there may be a great increase in production, not only in Australia but also in New Guinea, where it grows very easily and where there is a great need for additional cash crops?

Senator HENTY:
LP

– I cannot agree with the honorable senator that this is a bad name. I think it is a very good one. As a matter of fact, the first comment I ever heard on this subject was by an American who, seeing the words “ Passion fruit juice” on a bottle for the first time said: “ Boy, what a honey of a name! Let’s get this to the States “. So my experience is contrary to that of the honorable senator. If she thinks that the name militates against the sale of passion fruit or passion fruit juice in other countries I remind her that the traders, who are the people really interested in this matter, would have known of this long ago and would have taken steps to alter it.

page 435

QUESTION

SOCIAL SERVICES

Senator TANGNEY:

– I direct a question to the Minister representing the Minister for Social Services, ls the Minister aware that as a result of a recent arbitration court decision the female basic wage for a single female is in excess of £11 2s. a week, which is more than double the amount of pension available to a civilian widow with dependent children? Will the Minister, during the preBudget discussions, bear this matter in mind with a view to raising the pension of Class A widows to a more realistic figure in keeping with the educational and living needs of their families?

Senator Sir WILLIAM SPOONER:

– The honorable senator is aware that all social service matters are reviewed at Budget time.

page 436

QUESTION

CIVIL AVIATION

Senator VINCENT:
WESTERN AUSTRALIA

– Has the Minister for Civil Aviation seen a press report to the effect that East-West Airlines Limited has commenced a service from Sydney to Albury, presumably with his knowledge and consent? Has the Minister received any complaints from members of the Opposition about the granting of approval for such a service? Has any member of the Opposition suggested that the service could have been performed by some other airline, such as Trans-Australia Airlines?

Senator PALTRIDGE:
LP

– This is a development in airline operations which should be received with a double dose of gladness by members of the Opposition, because Trans-Australia Airlines was recently granted interstate rights for the service between Sydney, Albury, Melbourne and return. This most recent development means that the New South Wales transport licensing authority has granted a licence to East-West Airlines Limited to operate an intra-state service from Sydney to Albury and return. It will be necessary, as is well understood by East-West Airlines Limited, that the company now obtain a licence from the Commonwealth Department of Civil Aviation. The company has made no application for that licence as yet. I understand an application will be submitted within a few days, when the matter will be thoroughly considered.

page 436

QUESTION

UNITED NATIONS

Senator DITTMER:
QUEENSLAND

– My question to the Minister representing the Minister for External Affairs is consequential upon a question asked by Senator Cole. Will the Minister ir-form the Senate that in relation to contributions made by nations to the United Nations there are set out definite conditions governing the position before default can be debited to any particular nation, whether it be France, Belgium, Portugal or the Soviet, and affect its membership? What are the conditions governing the position?

Senator GORTON:
LP

– I am not sure what the honorable senator has in mind.

Senator Dittmer:

– They are definitely set out under the terms of the constitution of the organization.

Senator GORTON:

– Not as definitely as all that.

Senator Dittmer:

– They are.

Senator GORTON:

– With all respect, they are not set out as definitely as that. What is set out is that in assessing contributions by various members of the United Nations, their ability to pay shall be one of the matters taken into consideration. All that is set out in relation to countries which fall into arrears, as happened with various countries in relation to moneys due for operations in the Middle East and the Congo, is that they can suffer the loss of a vote unless they are able to persuade the United Nations that their failure to pay was due to some new factor not known when the original assessments were made and which was beyond their control. This is not something that is definite, as the honorable senator has suggested.

page 436

QUESTION

WEST IRIAN

Senator WOOD:
QUEENSLAND

– Has the Minister representing the Minister for External Affairs noted a statement purported to have been made by a Minister of the Indonesian Government to the effect that a full-scale publicity campaign will be initiated to prevent a plebiscite for self-government and independence being taken in the territory now known as West Irian? Will the Minister for External Affairs see that Australia’s delegate to the United Nations is instructed to ensure that a plebiscite is conducted by the Indonesian Government, as that was one of the conditions under which Indonesia assumed control of what was formerly Dutch New Guinea?

Senator GORTON:
LP

– I have seen the statement to which the honorable senator has referred. If I remember correct!:’, it was made by the Minister for Information in the Indonesian Government. All I can say is that the attitude of the Australian Government in relation to selfdetermination was made perfectly clear by the Minister for External Affairs in a public statement in August last, and by other spokesmen for Australia. When an arrangement was made between the Netherlands and Indonesia for the taking over of West New Guinea, the United Nations took note of the arrangement and assumed responsibility for seeing that it was carried out. That is the position as it is to-day.

page 437

QUESTION

ANNUAL REPORTS

Government Departments and Instrumentalities

Senator MCCLELLAND:
NEW SOUTH WALES

– I ask the

Leader of the Government in the Senate whether it is a fact that in the past the annual reports of certain government departments have been made available to honorable senators after the Estimates debate has taken place. To enable honorable senators to have full knowledge of the functions and administration of each department, will he request Ministers to see that the annual reports of their departments and of government instrumentalities under their control are tabled in the Senate and made available to senators before the next Estimates debate takes place?

Senator Sir WILLIAM SPOONER.This is something that has recurred over the years. I speak subject to correction when I say that in the past arrangements have been made for interim reports to be tabled in the Parliament before the Budget debate when complete reports cannot be produced in time. I think that before the next Budget debate the honorable senator will find that a number of interim reports from various bodies will be lodged and that Ministers, when tabling them, will say that they will be followed by the complete reports at a later stage.

page 437

QUESTION

ASIAN STUDENTS

Senator HENDRICKSON:
VICTORIA

– I address the following questions to the Minister representing the Minister for External Affairs: Mow many foreign students, particularly Asian students, are temporarily in Australia doing courses in primary, secondary, technical and university sub jects? How many of these students are studying under the Colombo Plan and under the United Nations specialized agencies’ programmes? What financial guarantees are required in respect of these overseas students, not including those to which I have just referred? If the guarantors are unable to meet their financial responsibilities, can any action be taken to enforce the guarantee? If these students become ill or are unable to secure employment, are they entitled to medical and unemployment benefits similar to those granted to Australians?

Senator GORTON:
LP

– There are approximately 10,000 foreign students in Australia. Approximately 1,000 students are studying under the Colombo Plan. I do not know how many are studying under the United Nations specialized agencies’ programmes. Students who come here privately do so entirely at the expense of their parents. They are given the hospitality of this country, and our schools, universities and technical training establishments are thrown open to them provided the necessary fees are paid. Those fees do not cover the cost of running the establishments but cover only a part of the expense to which the Australian people are put to provide this service for these students. Being private visitors, they are not entitled, as far as I know, to particular medical or unemployment benefits.

page 437

QUESTION

WEST IRIAN

Senator MURPHY:
NEW SOUTH WALES

– I address to the Minister representing the Minister for External Affairs a question about the serious matter which was raised by Senator Wood. Will the Government ascertain whether the report of the statement on the future of West Irian made by the Minister in the Indonesian Government is correct and whether it represents the attitude of the Indonesian Government? Will he then report the result to the Senate?

Senator GORTON:
LP

– The Minister for Information in the Indonesian Government, to whom the statement has been attributed, is not the Minister directly concerned with West Irian matters. The report of the statement has been received by the Department of External Affairs and is being studied. There is no reason that I know of to doubt that it is substantially accurate.

page 438

QUESTION

SOCIAL SERVICES

Senator COHEN:
VICTORIA

asked the Minister for Health, upon notice -

  1. How many persons receiving (a) age pensions, (b) widow’s pensions, and (c) invalid pensions have been granted a medical entitlement card?
  2. How many persons in each of these categories are ineligible to receive such card because their income exceeds £2 per week?
  3. How many persons in each of these categories receive a full pension and are nevertheless ineligible to receive such card?
  4. What is the average annual cost per person of services and medicines supplied to pensioners holding medical entitlement cards?
  5. Will the Government give consideration to abolishing this restriction and authorizing the grunting of a medical entitlement card to all pensioners or, alternatively, to extending the present limit of £2 per week as the maximum permissible income?
Senator WADE:
CP

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

  1. Separate figures for persons receiving age, invalid and widow’s pensions are not available. However at 31st December, 1962, there were 720,277 persons in receipt of age, invalid, widow’s and service pensions and tuberculosis allowances enrolled in the pensioner medical service. 2 and 3. This information is not available. At 3 1st December, 1962, there were 96,060 pensioners who were not enrolled in the pensioner medical service. This figure includes those pensioners who, although eligible, have not chosen to enrol in the service as well as those not eligible for enrolment.
  2. For the year ended 30th June, 1962, the average annual cost per person enrolled in the pensioner medical service - pensioners and dependants - for medical services and pharmaceutical benefits was £17 2s. 3d.
  3. The Government has this matter continuously under review but it is not proposed to amend the existing means test at present.

page 438

QUESTION

CIVIL DEFENCE

Senator MCCLELLAND:

asked the Minister representing the Prime Minister, upon notice -

In view of recent publicity arising from the 1963 Aldermaston peace march in England to the British Government’s previously secret emergency proposals in the event of nuclear attack on that country, is the Prime Minister able to inform the Senate whether or not the Australian Government has formulated any emergency plans for the administration of government in the event of any nuclear attack on Australia?

Senator Sir WILLIAM SPOONER:

– The

Prime Minister has supplied the following answer to the honorable senator’s question: -

In Australia, the Commonwealth’s planning for all aspects of civil defence includes consideration of the measures necessary to maintain the essential functions of the Commonwealth Government in an emergency situation. We have not yet proceeded to the point of firm arrangements in the sense of the British plans.

page 438

QUESTION

NUCLEAR TESTS

Senator CAVANAGH:
SOUTH AUSTRALIA

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

  1. Have experiments with nuclear explosions been conducted al Maralinga, South Australia?
  2. Were Department of Supply personnel and vehicles used prior to such explosions in attempting to keep native aboriginals away from the area?
  3. Were aboriginals kept away from the area at the time of such explosions?
  4. Has the Government any knowledge of harmful effects on natives as a result of these explosions?
Senator HENTY:
LP

– The Minister for Supply has furnished the following answers: -

  1. Yes, but not since 1957.
  2. Department of Supply personnel and vehicles were used in conjunction with aircraft to ensure by survey that natives were not within the prohibited area.
  3. No aboriginals were in the area at the times of such explosions.
  4. No.

page 438

QUESTION

TRADE

Senator HENDRICKSON:

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

  1. Has the Government yet made any assessment in regard to President Kennedy’s proposals for United States’ trade expansion and the possible effect upon Australian primary industry?
  2. Is it a fact that the United States inflicted a serious blow against the Australian rice industry recently when an arrangement by Australia to sell 40,000 tons of Australian rice to Indonesia was cancelled and the United States was able to sell 60;000 tons of rice to Indonesia? If so, is this just one example as to how the United States will break down so-called trade barriers?
Senator WADE:
CP

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

  1. The Government has been giving close consideration to the possibilities arising from these important United States’ initiatives for trade expansion. The matter has been the subject of highlevel discussions by the Minister for Trade in Wellington, Washington and Ottawa. The Minister for Trade is currently participating in Commonwealth discussions in relation to this matter in London and will go on to Geneva for the General Agreement on Tariffs and Trade ministerial meeting commencing on 16lh May, where this subject will be one of the major items for consideration.
  2. No. 1 am informed that rice marketing authorities in Australia have not had any official enquiries from Indonesia for any large quantity of rice. In any case, Indonesia is not a normal customer of Australia Tor rice and regular markets are absorbing the limited export surplus which still remains to be sold for this season.

page 439

QUESTION

ABORIGINES

Senator TURNBULL:
TASMANIA · IND; AP from Aug. 1969; IND from Jan. 1970

asked the Minister for Health, upon notice -

In view of the large sums of money spent outside Australia to build up the health and dietary needs of foreign and trust territory populations, will the Minister advise how much has been spent in each Slate in each of the last five years on improving the health of our own aboriginal population?

Senator WADE:
CP

– I now furnish the following reply: -

The money spent in each State on improving the health of the aboriginal population is the responsibility of each of the Slate governments, and these figures are not available as such. In the Northern Territory, the health services arc provided by my department. It should be pointed out, however, that a complete medical service is provided for all residents in the Northern Territory, and no differentiation is made between the European and aboriginal population. My department owns three aircraft which are used to maintain regular visits at approximately five-weekly intervals to the remote areas in the Territory, for which there are no other means of transport. The areas visited include native settlements under the control of the Welfare Branch of the Department of Territories, mission settlements conducted by various religious organizations and cattle stations which are privately owned. Medical and dental attention is provided for both Europeans and natives in these areas and, if necessary, patients are evacuated from these areas to base hospitals free of charge, regardless of whether they arc European or native. In the past eighteen months, health inspectors have been appointed in the Northern Territory, solely for the purpose of looking after the health and hygiene of the people on the various settlements in the Northern Territory. Four hospitals in the Northern Territory cater for both European and aboriginal patients and it is not possible to differentiate the cost involved for treating aboriginal patients. They receive the same drugs and treatment and arc nursed by the same nursing staff, although in certain circumstances they may receive their treatment in separate wards.

page 439

QUESTION

OVERSEAS INVESTMENT IN AUSTRALIA

Senator COHEN:

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

  1. With reference to a publication issued by the Manufacturing Industries Branch of the Department of Trade entitled “ Directory of United States

Investment in Australian Manufacturing Industry “, is it a fact that the publication sets out the names of United States firms and their Australian associates and the relevant industry, but, apart from the general statement that about 820,000,000 dollars, or almost one-third of the total inflow of private overseas capital into Australia in the decade to 1960-61, came from the United States and Canada, gives no other information as to the amount of such capital invested in the various sectors of the economy?

  1. Has the Government any statistical information available concerning United States capital investment in Australia, firm by firm or industry by industry?
  2. Will the Minister arrange for the inclusion of such information in the next issue of the directory?
Senator HENTY:
LP

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

  1. Yes. A large and continuing demand for this booklet, however, indicates that it is regarded by industrialists, both in Australia and overseas, as being a very useful reference publication. 2 and 3. Detailed official statistical information of this nature is not available.

page 439

QUESTION

CIVIL AVIATION

Senator WHITESIDE:
QUEENSLAND

asked the Minister for Civil Aviation, upon notice -

Now that Ansett-A.N.A. by its acquisition of the MacRobertson Miller Airlines, has a route to operate from Darwin to Perth thus completing its around-Australia circuit, is the Minister prepared to authorize Trans-Australia Airlines to operate a service between Perth and Darwin to enable it to compete on a similar circuit? If not, why not?

Senator PALTRIDGE:
LP

– I now furnish the following answer: -

If Trans-Australia Airlines makes application to enter the Perth-Darwin route, then such application will receive full consideration. However, as I have previously pointed out, ail routes are allocated on the basis of the needs of existing traffic. Until recently there was no clamour for the admission of a second airline on the Penh-Darwin route and I am not aware that traffic has increased to the point that would justify such a move. The network operated by MacRobertson Miller Airlines, including the Darwin route, is regarded as a “ developmental “ air operation and is subsidized. One of the principles of subsidization is that eligibility ceases as soon as there is competition.

page 439

QUESTION

AIRMAIL

Senator ORMONDE:

asked the Minister for Civil Aviation, upon notice -

  1. Under the 1952 legislation was half the interstate airmails of Australia diverted from TransAustralia Airlines to Australian National Airways Proprietary Limited?
  2. Would it not have been more consistent with the Government’s announced policy of fair competition between the two major airlines if they had been left to submit tenders for the carriage of those mails?
Senator PALTRIDGE:
LP

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

  1. Prior to 1946, airmails were carried by the private enterprise operators at commercial rates negotiated with the Post Office. When the previous Government attempted to nationalize the airways in 1946 one of the measures adopted to force the private airlines out of business was to take away the right of mail carriage. Wherever possible mails were transferred to Trans-Australia Airlines and paid for at a rate considerably in excess of the rate previously paid and at no time were tenders called or even contemplated. Indeed, the payment was determined on a basis designed to disguise the significant losses then being incurred by T.A.A. under Labour administration. When the present Government established the two airline policy with fair and equal competition between the Government-owned airline and the private enterprise airline, it was natural that the available mail should be shared, provided always of course that the dictates of speedy mail delivery were met. However, a new rate was again agreed on a commercial basis and paid to both operators. Mail payments were not manipulated as in the Labour administration, as a device to pay substantial subsidies to the airlines.
  2. No. The airlines agreement provides for consultation and agreement among the airlines on matters such as air routes, time-tables, fares and freight rates and related matters. Any agreement reached by the airlines is subject to appropriate government approval. So with airmail carriage the operators in consultation agreed with the Post Office and my department to a commercial rate for the carriage of mail having regard to the service performed.

page 440

QUESTION

CIVIL AVIATION

Senator COHEN:

asked the Minister for

Civil Aviation, upon notice -

  1. Did the provisions of the Airlines Agreement Act, passed just prior to the 1961 federal election, that the airlines agreement, as set up in 1952 and subsequently amended and due to expire in 1967, be extended for a further ten years from 1967, have the effect of giving the agreement a 16-year currency from the passing of the act?
  2. Does the Minister regard it as proper to bind the hands of future governments over such a long period?
  3. Are there any proposals under consideration to extend the period beyond 1977?
Senator PALTRIDGE:
LP

– The following answers are now supplied: -

  1. Yes.
  2. It is true that the Commonwealth has entered into a solemn and binding contractual obligation with Ansett Transport Industries Limited of a long-term nature, but in this respect the airlines agreement is no different from the many hundreds of other contracts of more than three years’ duration to which the Commonwealth is a party. Because of the important issues involved, the Government subjected the airlines agreement to the full scrutiny of Parliament and provided that that agreement would not come into force unless and until approved by Parliament. This does not make the agreement any more binding but certainly establishes that it is in accordance with the will of the people. Furthermore, the extension of the contract was fully justified because of the commercial consideration involved. Both the government airline and the private enterprise airline were faced with immediate decisions on major re-equipment with turbo jet aircraft involving the expenditure of many millions. The Government was desirous of facilitating this re-equipment of both airlines thereby ensuring the continued availability of a high standard of service to the travelling public and ensuring that the aircraft were selected and introduced in circumstances which would promote the stability of the domestic air transport industry. It was essential for the management of the private enterprise airline to know, before it committed the funds of more than 59,000 share and deposit holders, the circumstances which would obtain during the period over which the aircraft would be financed and depreciated. No responsible management would authorize the expenditure of funds of this magnitude in face of a continuing threat of nationalization of the air transport industry, unless it was assured of the right to operate the equipment throughout its effective economic life. Equally with the government airline, operating as it is under the Liberal administration on a business basis, it was vital that it should be free to plan its long-term development in terms of jet re-equipmenti
  3. No.

page 440

COMMONWEALTH CENTRE, MELBOURNE, VICTORIA

Report of Public Works Committee

Senator ANDERSON:
New South Wales

– Mr. President, I present the report of the Parliamentary Standing Committee on Public Works relating to the following work: -

Proposed erection of Stage Two ofthe Commonwealth Centre, Melbourne, Victoria.

The committee has recommended the construction of the building to the size and design proposed, at an estimated cost of £2,560,000. This recommendation includes full air-conditioning at an estimated cost of £126,000.

I invite the attention of the Senate particularly to this report of the committee, with special reference to paragraph 74 on page 14, which reads in part -

The Commonwealth Centre in Melbourne is a project of considerable magnitude, ultimately involving development of a whole city block, lt fs too large an investment by the Commonwealth to be developed on a piece-meal basis. That this has been the case is, we believe, indicated by the extent of over-crowding in Stage I., some of its deficiencies, and indecision even now, about the occupancy of Stage II.

I also direct attention to conclusions numbers 11, 12, 13, 14 and 15. In summary, Mr. President, these conclusions point out that stage 11. of the Commonwealth Centre, Melbourne, was submitted to the committee on the basis of providing office accommodation of a general administrative nature. During the course of the evidence the committee was told that it was proposed to accommodate certain government departments, including the Repatriation Department, in the proposed new building. Evidence having been called from the Repatriation Department, it was revealed that the department had special requirements, and evidence subsequently taken from the Department of Works estimated that these additional requirements would involve extra expenditure of some £200,000.

During the course of the hearings, it was resolved departmentally that accommodation in the Commonwealth Centre, as proposed, would be allotted only to departments with general administrative functions. This is the basis of the recommendations of the Public Works Committee.

The foregoing comment is only a brief background to evidence which prompted a number of the recommendations from your committee. For example, recommendation No. 6 reads -

To ensure (hat new office buildings meet the needs of occupying departments, decisions about occupancy should bc made in the early planning stage.

Recommendation No. 7 reads -

A comprehensive review of the needs for accommodation should be made without delay, and if necessary the master plan for the Commonwealth Centre amended accordingly.

Recommendation No. 8 states -

An order of movement of departments to the Commonwealth Centre should bc established.

I direct the attention of the Senate to the fact that the question of air-conditioning in

Commonwealth buildings is a recurring issue of the greatest magnitude. The committee has recommended that an inquiry into all aspects of the need or otherwise for airconditioning in Commonwealth buildings should be put in hand without delay.

Senator ORMONDE:
New South Wales

– 1 wish to support the remarks made by Senator Anderson and to make a few comments of my own on this proposed building. We found that there is very considerable overcrowding in the Commonwealth departments in Melbourne and a great need for additional space. Anything that I have to say in this respect is, of course, said as a new member of the Public Works Committee. 1 have been a member of the committee for some eighteen months and I have always found1 that-

Senator Wright:

– I rise to order, Mr. President. I should like to be informed on the method of procedure. As 1 understand the position, Senator Anderson has presented a report and Senator Ormonde is now proceeding to speak to it. Is the matter open to debate at this stage? I should have thought that the correct procedure would have been for someone to move that the report be printed. Had that been done, all honorable senators would have had a chance to discuss it. I should prefer that the debate be deferred until we have had an opportunity to peruse the report. I question whether Senator Ormonde is in order.

The PRESIDENT:

– Order! The honorable senator is not in order at this stage. He should ask for leave to make a statement or propose a motion.

Senator Ormonde:

– I ask for leave to move, “ That the paper be printed “.

The PRESIDENT:

– There being no objection, leave is granted.

Senator ORMONDE:
New South Wales

– by leave - I move -

That the paper be printed.

There are a few general observations I want to make about the Department of Works and government departments generally. That is why I think the Senate should hear my views.

Senator Sir William Spooner:

– I rise to a point of order. None of us has seen this report. I think it would be more appropriate for the honorable senator to ask for leave to continue his remarks at a later stage. Then we could all have a look at the report. I am prepared to give an undertaking on behalf of the Government to put this matter on the business paper so that we can all become acquainted with it.

Senator McKenna:

– On the point of order, I point out that it is quite proper for Senator Ormondes - who has moved that the paper be printed - to proceed at once to speak to the motion.

Senator Wright:

– ls there a motion before the Senate that the paper be printed?

Senator McKenna:

– Yes. It is quite competent for the honorable senator to make forthwith whatever remarks he wishes to make. It is a matter for him. No point of order can be upheld denying him that right. More than one honorable senator may like to comment at this stage. That would be perfectly proper. I suggest that no point of order is involved.

The PRESIDENT:

– Order! Senator Ormonde, as a member of the Public Works Committee, is informed on the- subject, but that does not apply to other honorable senators who have not had the advantage of seeing the paper. The honorable senator may proceed.

Senator ORMONDE:

– -I have found that, generally speaking, government departments seem reluctant to do anything about parking. They did not seem to be prepared to take a lead in providing parking space in the area surrounding this building. Many members of the committee suggested that it was important for the Commonwealth Government particularly to take a lead in this matter, as other private institutions and major building organizations were providing parking space in relation to their projects. Private organizations have to make provision for parking space in accordance with government and municipal transport regulations in most of the States. As Senator Anderson has said, some provision will be made, but it was with great reluctance that the departments agreed to that.

Anybody who is familiar with Melbourne will know that unless there is big thinking about parking in this area things will be serious for the public and those who occupy the building. After all, Public Service departments will be accommodated in this building. If they are going to serve the public and give effect to the real meaning of the term, Public Service, it is at least necessary to enable the public to get into the building readily in order to be served. As I see the position in Melbourne, great difficulties are likely to occur.

As a member of the committee 1 found, too, that there is a tendency for departments to exclude themselves from the operation of regulations governing heights of buildings and heights of ceilings in rooms. The departments seem to regard themselves as sacrosanct. When this matter has been raised in other towns, as well as in Sydney and Melbourne, the departments say in effect that they arc a law unto themselves and do not need to conform to the regulations if it does not suit them to do so. I do not think that is a very good idea in view of traffic congestion and the general accessibility of buildings - problems that face the public to-day.

I wish to make another comment. The’ committee visited the centre twice and spent six months investigating the project. 1 compliment members of this non-party committee who really did good work in bringing the faults of the administration to the fore. For example, one public servant - he shall be unnamed as I do not want to mention his name - said quite plainly that if he had had his say in the design of a functional building it would have been designed differently from the shell’ building he was asked to design. As Senator Anderson said, originally arrangements were made for the Repatriation Department to occupy a portion of the shell building, but after arrangements had been made and the department was ready to occupy the building it was found that the mechanical installations and medical equipment necessary were of such a nature that the shell building was not suitable. That came out as a result of probing by members of the committee, but the proposition that came before the committee in the first instance was that the Repatriation Department should occupy the building. Senator Anderson did a lot of probing in this matter. He has had experience in hospitals and repatriation matters and I commend him for his part in having the position altered.

Another thing that has worried me about the Department of Public Works is its reluctance to do anything about air conditioning. It was only with the greatest reluctance that it agreed that air conditioning was necessary. If honorable senators look through the reports of the Public Works Committee - of inquiries into projects at Darwin and other places - they will find that this reluctance on the part of the Commonwealth to agree to air conditioning for workers is pretty general. The department even had second thoughts about air conditioning for the nurses’ quarters at the Darwin Hospital.

Senator Wade:

– The Government has agreed to air conditioning for the nurses’ quarters.

The PRESIDENT:

– Order! The honorable senator is getting too far away from the motion.

Senator ORMONDE:

– I am sorry. I know that the Government has agreed to air conditioning of the nurses’ quarters at Darwin. I shall get back to the Melbourne building. I found also that the departments seem to be horrified at the idea of providing toilets for the public. It was only after much pressure that they agreed to provide toilets for the public: - and this is in a Public Service building which is to be established to provide service to the public.

I conclude by suggesting that the powers of the Public Works Committee ought to be extended. I know that Senator Wright will agree with this. I feel that we do not have enough information. A proposition is placed before us by the Treasury that a building of a certain type at a certain cost is to be constructed, but we have no information about contracts, the types of materials to be used, whether the lowest tender is to be accepted and all the sorts of things which I think the Public Works Committee should consider. I think also that once the committee has given its decision it should be able to continue its interest in the project until its completion. I can imagine that between the present time and the time of completion of the Commonwealth Centre No. 2 in Melbourne a number of things may have to be considered. For example, in the No. 1 building very serious constructional faults have occurred. The flooring and panelling have split. I would suggest that the reason is that poor quality material has gone into the job.

I should like to make one other point. This building is used by the Department of Social Services. On the morning that I arrived in Melbourne I saw an old, crippled woman with a man on the ground floor of that building at five minutes past nine. The man was being pushed along in a wheel chair. That couple could not get into the lift because there was no lift driver; it was an automatic lift. A situation such as that is quite serious for age pensioners who are feeling the strain of their journey to the city to arrange details of their pension or social service benefit. The couple to whom I refer had been pushed about from floor to floor and were still in that building at 12.30 p.m., their business not completed. My own reaction to that situation was such that I brought the matter to the attention of the head of the department and suggested that an officer could be sent to the suburbs to see such people and give them the service they need at home.

The PRESIDENT:

– Order! The honorable senator’s remarks are becoming wide of the subject again.

Senator ORMONDE:

– I support the report that has been tendered by Senator Anderson and thank him for his help to me and other members . of the committee. I suggest that serious consideration be given to the ideas expressed by members of the Labour Party regarding the extension of the powers of the Public Works Committee and the enlargement of its responsibilities.

Debate (on motion by Senator Wright) adjourned.

page 443

PROCESSED MILK PRODUCTS BOUNTY BILL 1963

Second Reading

Debate resumed from 9th May (vide page 366), on motion by Senator Wade -

That the bill be now read a second time.

Senator KENNELLY:
Victoria

– Mr. President, the bill before us has two purposes. The first is to continue the export bounty on processed milk products for a further twelve months from 30th June, 1963; the second is to increase from £350,000 to £500,000 the maximum amount of bounty payable for the year 1963-64. The bounty will be payable on the exports of processed milk products, which consist of sweetened and unsweetened condensed milk, full cream milk powders, infants’ and invalids’ foods, malted milk, &c.

The original purpose of the bounty was to reduce the severe disadvantage suffered by Australian suppliers of processed milk products in relation to competitors from other countries in export markets. It was known that those who were in the processed milk business in other countries were subsidized by their governments. This, of course, gave them the opportunity to under-sell the Australian product on the world’s markets.

The Minister representing the Minister for Primary Industry (Senator Wade) has stated that the bill has another purpose. He has said, in effect, that this purpose is to divert butter fat from the manufacture of butter and cheese. The reason he has given is that the world markets for butter and cheese are over-supplied and that if Australia can use more butter fat in the (manufacture of processed milk products it will put us in a more favorable position than if we had to use it in butter or cheese manufacture only.

A most remarkable thing in this country is that we now have to divert butter fat from the manufacture of butter or cheese -because that market is over-supplied. Yet on our television screens, particularly in Melbourne, we see advertisements for Swiss cheese, sold under the “Tiger” brand. I have been associated with other tigers, but this was “ Tiger “ cheese. I have ascertained that the value of the cheese that Australia imports each year is £803,000. Yet we cannot sell all the cheese we make here! I suppose I eat as much cheese as the Australian consumption per capita per annum. I do not know whether I have eaten any “ Tiger “ brand cheese or whether it is any better than our own cheeses, but it does not make sense to me that we pay the bounty to this industry, while imports of cheese are so high, in order to divert butter fat away from the manufacture of butter and cheese. We cannot sell or consume ‘the quantity of cheese made in Australia.

At present we produce about 15,000 tons of cheese a year, and we pay 23s. per cwt. as a subsidy on that cheese. Then, to complicate the whole position, we permit people to import cheese; To me that just does not add up. I do not say that the whole £803,000 worth of imported cheese comes from Switzerland or from any one country, nor do I know whether so-called Swiss cheese comes only from Switzerland, but I took the trouble to ascertain the imports of Swiss cheese because that is the one advertised. These advertisements appear on Sundays, particularly, between the hours of noon and 2 p.m. I am certain that if the Minister ever has a moment at home he turns on the television in that period.

I admit that Switzerland might say: “We buy so much wool and other commodities from you. You must buy from us.” No one objects to Swiss imports into this country if they do not cut across our own production as do imports of cheese. Nobody is opposed to the importation of watches from Switzerland instead of from other countries. I cannot understand why we pay a subsidy of £1 3s. a hundredweight on all the cheese that we produce in this country because we cannot find a market for the cheese that we make here and at the same time, yet, being a benevolent country, allow cheese to be imported.

Senator Kendall:

– It is not the same sort of cheese.

Senator KENNELLY:

– How long can we keep on pumping money into an industry such as this? I do not blame the’ industry but I blame the administrators for allowing this state of affairs to continue.

Senator Mattner:

– We are rapidly gaining that market for ourselves.

Senator KENNELLY:

– I do not think we are. If you look at the figures I think you will see that each year we are importing a little more. You came in. a little too quickly, senator. Not so fast next time’ I have not the precise figures in my mind. I think that last year we imported cheese worth about £30,000 more than the value of the imports in the preceding year. There is a steady increase.

Senator Mattner:

– But there is a greater increase in the production of the same kind of cheese in Australia.

Senator KENNELLY:

– There could not be.

Senator Wright:

– I should think that the position was as was stated by Senator Mattner.

Senator KENNELLY:

– It is not. I ask you only to examine the official figures in the Commonwealth publication. You will see that, over the years, there has been a slight but steady increase in the imports of cheese to this country. It is true that there are now more people in Australia than there were previously. But I do not think that they would consume the whole of the extra amount available. I was somewhat amazed at the position. We export 24,300 tons of cheese a year. It is estimated that, at the end of June, we will have 3,078 tons in stock. We have not found a market for it yet either at home or abroad.

A tremendous amount of subsidy goes into the processed milk industry. I think that we provide £30,500,000 for the production of butter and cheese. In addition, a great deal of assistance, such as herd testing and improvement, is given by State governments. I admit that, on the other hand, dairying has been a very good industry for this nation. I suppose that, in many small country towns, it provides a continual supply of ready cash which assists to keep those towns afloat. As a rule, the farmer gets his cheque for butter fat once a fortnight, or once a month, and this results in there being ready money in the towns. In wheat or wool districts the farmer gets his money, in the main, after the crop or the clip has been disposed of. The dairy industry has played a significant part in keeping country towns alive and maintaining our exports. I think that exports of all dairy products are valued at about £40,000,000 a year.

The proposals in this bill before the Senate will cost the taxpayers £500,000 a year. The Minister for Health said that under the first bill on this subject we spent £350,000. He said that that expenditure was worth while because it encouraged the export of butter fat in the form of processed milk products and thus diverted butter fat away from butter and cheese production. He said that the legislation had achieved its purpose because for the first seven months of 1962-63 there had been a great increase in the consumption of butter fat in processed milk products. He stated that the consumption of butter fat had increased to- 3,642 tons compared with a consumption of 2,798 tons and 2,579 tons in the same period in the two previous years.

I believe that the more of our milk we can convert to processed milk products the less trouble we are likely to strike in the world’s markets of the future. It is true, as the Minister said in answer to a question, that we will not continue to receive a preference of 15s. a cwt. in respect of our butter shipped to the United Kingdom market, but he has assured us that we will continue to enjoy at least our present quota. As we know, the price of butter fluctuates. One wonders whether, at the moment, we are really giving away our advantage of 15s. a cwt., having regard to the maintenance of our quota and the fact that the price of butter has jumped. We can only hope that that position will continue.

During the year 1957-58, a total of 1,264,000,000 gallons of milk was produced in Australia. Of that total, 64.2 per cent, was used for butter production, 6.2 per cent, for cheese production, 6.3 per cent, for processed milk products, and 22.3 per cent, was used for other purposes, mainly domestic milk supplies. In 1958-59 production of milk was 1,370,000,000 gallons and the proportion used for butter was 65.8 per cent. The proportion used for cheese rose from 6.2 per cent, to 6.9 per cent.

Senator Wright:

– Does that not prove the point that you were disputing?

Senator KENNELLY:

– No, I do not think it does. There was a drop of 5.9 per cent, in milk used for processed foods and a similar fall in milk used for domestic purposes. There has been an upsurge in the total production of milk. In 1961-62 it was 1,450,000,000 gallons, of which 63.3 per cent, went into butter and 8.6 per cent, into cheese The quantity used for processed milk products fell to 5.7 per cent, and there was a slight fall from the preceding year in the domestic use of milk.

When one looks at the figures for processed milk products it must be admitted that they form a very small proportion of our total milk products. On the other hand, the figures relating to the value of processed milk products show that in 1956-57 condensed and evaporated milk produced were valued at £9,200,000, powdered milk at £5,500,000, infants’ food at £4,400,000 and other milk products at £4,600,000. While production of condensed and evaporated milk fell to £8,100,000 . in 1958-59 compared with £9,200,000 in 1956-57 production of powdered milk rose to £6,100,000. Production of infants’ food remained more or less stationary at £4,700,000 and production of other milk products rose by possibly½ per cent.

These figures are taken from the McCarthy report following the investigations of the Dairy Industry Committee of Enquiry. I think it was an exceptionally good report although it was side-stepped - and not altogether by one side. I wonder whether we can afford not to have another look at the report. At present, we are fortunate. Great Britain is still outside the European Common Market, but I should be very surprised if it is out of the Common Market for all time. If Great Britain is admitted to membership we will not be guaranteed a quota on the British market because it seems unlikely that we will ever be able to talk terms again and if Britain gains entry it will look after itself.

One point which gives me some concern, although it does not really affect the bill, is the consumption of butter. In 1952 consumption of butter in Australia was 31.2 lb. per person but it fell in 1959 to 25.9 lb. It is true that between the same years consumption of margarine rose only from 7.9 lb. per person per annum to 8.8 lb. As I have said, this is not directly concerned with the bill because butter is not involved in the provisions of this measure, but taking the industry as a whole there has been an appreciable decline of approximately 5.3 lb. a head in the use of butter by Australians. This decline occurred in the years when we are said to have been so prosperous. Possibly immigration has had some effect on these figures,because some of the immigrants do not like butter as much as we do and buy other food instead. It may be said that people were so prosperous that they could afford to buy other food. Nevertheless this represents a pretty big drop in consumption of butter over the period.

One is concerned about the value of the products. We are paying at least £500,000 a year as a subsidy so that our manufacturers, on the one hand, can compete successfully with their competitors manufacturing processed products in other countries. The subsidy is also designed partly to divert butter fat from butter or cheese to processed products. Then we find that exports of processed milk products have shown a decline. I could get figures only to 1960-61 from the Commonwealth Statistician. The value of processed milk products exported in the various years was -

I regret that I could not get any other figures which would fit in with the original subsidy of £350,000, but, I sincerely hope that we can deduce from the figures I have given that either we are consuming more processed milk foods in Australia or we are exporting more. One wonders just to what extent we will be able to improve the position. I think the Minister for Health (Senator Wade) indicated that for the first seven months of the 1962-63 season the export of butter fat in the form of processed milk products was approximately 800 tons greater than in the corresponding period for the previous season. If our exports do not rise but fall, the subsidy will be rather expensive.

The least we all can do is attempt to bridge the gap. So far no one has been prepared to rise and support the McCarthy report. Not having been prepared to support it, we must be prepared to pay the price. I do not think any one would have any doubt about the capacity of Mr. McCarthy, as I think he then was. I do not know whether he was knighted after presenting his report or before.

Senator Hannaford:

– It was afterwards. Senator KENNELLY. - No, I do not do him an injustice, because I think anybody who has ever dealt with him would speak of him as being an extremely able man who has rendered great service to this country. Let us hope the bill will achieve its purpose, that butter fat will be diverted from the production of butter and cheese to the manufacture of processed milk products, and that the farmer will be helped. The farmer who forwards his whole milk to the processing factories will not be as lucky as the farmer who sends his butter fat to the butter and cheese factories. On the other hand, the farmer whose whole milk goes to the butter and cheese factories has a lot more worries, because he has to keep up his supply the whole year round. The Opposition supports the bill.

Senator CORMACK:
Victoria

.- It is my very great pleasure to follow my yeoman friend from Albert Park. Senator Kennelly will understand that in using those words I am not having a crack at him. The honorable senator has done well in bringing to the notice of the Senate a matter which we tend to avoid. He has referred to the McCarthy report. Any one who has any knowledge of the dairy industry cannot read the McCarthy report without being impressed by its deep social and economic significance. The bill is confined to processed milk products, but it is really a by-product of the whole problem that is associated with the dairy industry.

I read the report of the debate on this measure in another place. It was obvious that, for understandable political reasons, there was a tendency on the part of honorable members on both sides of the House of Representatives to approach the matter from the standpoint of the needs of their constituents. Of course, it was proper for them to do so. Honorable senators likewise must interest themselves in the needs of their constituents, but the length of time for which they are elected is such that they can afford to take a broader view of this industry than can members of the House of Representatives. This measure should be considered in the light of the social and economic problems that Senator Kennelly has touched upon this afternoon.

It is inescapable that at some time or other we must have a searching look at the Australian dairy industry. Let me state the position in the form of a parable. The dairy industry is very much like the electric wiring system of an old car, the owner of which is constantly snipping out pieces of wire and putting other pieces in. From time to time the main cable has insulation tape wrapped around it, and occasionally a short circuit occurs in another part of the wiring loom. That gives us a picture of the problem that is associated with the Australian dairy industry. I think I shall be able to demonstrate to the Senate quite clearly that that is a fairly just comment.

I believe it has been necessary for the Government to introduce some form of subsidy to help the industry, because the condenseries have had, as Senator Kennelly and the Minister for Health (Senator Wade) have said, to meet competition from heavily subsidized products that have come out of France, Denmark and Holland, and which have invaded markets which the Australian industry thought were reasonably secure. In those countries the industry has been subsidized. So we have the absurd situation of one group of nations subsidizing their industry, and of our being pushed out of the market and having to resubsidize our industry to meet the competition. While our condenseries were endeavouring to meet this competition, the milk which was coming from the cows had to be diverted into other spheres of production. That milk flowed into the production of cheese.

The domestic consumption of cheese is between 24,000 and 28,000 tons a year. That figure is fairly static; there are no signs that it will rise greatly. Because of an agreement which has been entered into between Great Britain, New Zealand and Australia, 15,000 tons of cheese is exported to Great Britain. As Senator Kennelly said - most honorable senators will agree with him - all sorts of agreements can be made between the European Common Market countries and those which belong to the European Free Trade Association, and at some time or other we may find ourselves without access to the British market for 15,000 tons of cheese. We would then have to find a market for a total production of 43,000 tons.

As a result of the diversion of milk from the Australian condenseries because of competition in South-East Asia, the production of cheese rose from 50,000 tons in 1959 to 54,000 tons in 1961. This year the production is estimated to be 56,000 tons. We have - I repeat - a fixed market of the order of 28,000 tons in Australia and 15,000 tons in Great Britain - a total of 43,000 tons - but the gap between the amount of cheese produced in Australia and what it is possible to sell is widening. So although this subsidy was introduced to help condenseries to go back into the market and to take milk away from cheese production, it has set up a sort of short circuit across the system. This situation is now getting out of control. There are several reasons for this and for the problem of disposal, which I should like to tell the Senate, because the matter is very important.

I shall deal with the subject, which Senator Kennelly raised, of exotic cheeses coming into Australia. The consumption of exotic cheeses has risen. Senator Kennelly gave us the position in terms of money, whereas I propose to reduce it to terms of tonnage. In 1961, I find, 1,800 tons of exotic cheeses came into Australia. Last year, the amount imported was 2,500 tons, and this year it may be greater. These cheeses come from New Zealand, Switzerland, Denmark, Holland and France, particularly.

Senator Mattner:

– From 30 countries.

Senator CORMACK:

– They may come from 30 countries. The ones I have named are the main sources of supply of exotic cheeses. Not only do we have in Australia over-production of cheese to the extent of about 10,000 tons a year, but also we have exotic cheeses totalling between 2,500 and 3,000 tons coming into the country. I am not one to say that the importation of these cheeses should be banned, because they meet a need here. For example, it is of no use to say that we produce all the types of exotic cheeses that come into Australia; we do not. What is more important is that we cannot effectively produce them. Some people like Camembert cheese, for example. It cannot be suggested that we should prohibit the importation of Camembert cheese. I do not think that this cheese can be made in Australia. There is a great range of cheeses of that nature which cannot be made in Australia, but I do not think that, therefore, people should be refused the right to purchase and eat them if they want to do so.

Hidden behind this is the more serious problem that the quality of Australian cheese of the cheddar types is pretty bad. That is where our trouble starts. I believe that this bad quality cheese is produced in substantial tonnages because of this curious system that we have of subsidizing the quantity of our products irrespective of quality. I have some alarming figures. They are alarming to me and they must be alarming to the Senate. As far as I know, they have never been disclosed. I intend to refer to the areas of production of these bad cheeses simply by calling them Complex A, Complex B and Complex C, for the simple reason that, as senators, we have a provincial responsibility and a State responsibility. When an individual senator hears a comment which, he feels, reflects upon the State he represents, very properly he sets out to defend his State and what he conceives to be its interests. I hope that the Senate will forgive me. When I use these descriptions, Complex A and Complex B, I am referring in reality to a State, and honorable senators may draw their own conclusions about the State to which I am referring. That is their affair.

Senator Hannaford:

– Most of the complexes are in Victoria?

Senator CORMACK:

– It is suggested that most of the complexes are in Victoria. I am bound to confess that Victoria is doing pretty well out of the subsidy or the short circuiting of the system, for the simple reason that the greater the subsidy pushed into the industry the higher the monetary return to Victoria. Yet there are some very odd by-products of this. Every time there is an increase in butter subsidy from the equalization funds and it comes into Victoria, the value of land of a person who is not engaged in dairying goes up, and he has to pay more rates and more State land tax.

Senator Hannaford:

– It is a vicious circle.

Senator CORMACK:

– It is a completely vicious circle. Let me get back to Complex A, which is a fairly large cheeseproducing area of Australia, where the cheese industry is fairly efficient, where automation and highly developed mechanized means of production of cheese exist, and where there is a good deal of scientific control over the making of cheese. The average cost of cheese in that complex is £28 a ton. Of that cheese produced in that area at £28 a ton, 10 per cent, is downgraded.

In Complex B, where a comparable situation exists in terms of climate, soil and grass, the cost of producing, up to the level to which the Division of Agricultural Economics will admit, is £50 a ton, in other words, nearly double the cost in Complex A. The tragedy is that this area, which produces 15 per cent, of the total tonnage of cheese made in Australia, contributes to the Australian market 50 per cent, of the downgraded cheese. So you have, on the one hand, an area which produces 90 per cent, of the choicest cheese at £28 a ton, and on the other hand an area, almost similar in character, in which 75 per cent, or 80 per cent, of the downgraded cheese is manufactured at nearly double the cost of production.

Senator Mattner:

– That is the manufacturing cost?

Senator CORMACK:

– Yes. Not only does it cost nearly twice as much to produce a ton of cheese, but also the area produces 50 per cent, of the downgraded cheese in Australia. It is this downgraded cheese that is destroying the market, to this extent: The cheese from Complex B has to be got rid of, and in order to do this the market is flooded with cheese at cut-rate prices. Therefore, another vicious circle begins to operate. The efficient producer of cheese, who produces high quality cheese, is driven out of the market by a group of producers who are subsidized by the Commonwealth to drive the good quality cheese out of the consuming markets of another area. This, to me, is just madness. I do not know how it will end unless wc tackle the industry and some differential is applied. Standards of quality will have to be laid down before subsidies are paid. To satisfy New South Wales senators, I say that I am not referring to their State, because its southern milk and cheese production is pretty well in balance.

Senator Ormonde:

– Everything is in balance in New South Wales.

Senator CORMACK:

– Until you get to Sydney.

Senator Arnold:

– What is the cause of so much downgraded cheese?

Senator CORMACK:

– In this particular area, it is just inefficient processing of the milk. In the area to which I am referring are fourteen co-operative butter or cheese factories - mostly cheese factories. There is a good test of their inefficiency. These co-operatives meet the problem by reducing the price that they pay to their suppliers, so the more money we pour into the support of this industry the greater the percentage of downgraded cheese.

Although I support the bill, because it is a bill with a limit placed on it - the subsidy is to extend to 1964 - I have risen to occupy a few minutes in placing before the Senate some of the absurdities in the economic policies involved in putting in these new fuses and wires. Senator Kennelly is perfectly correct in stating that this problem will never be solved until the industry has been held up to the light and there has been a factual examination of it.

In saying that we should sustain, for example, the level of the industry in Queensland, in northern New South Wales and in Western Australia, I may rightly be accused by honorable senators from other States of advocating the interests of the State of Victoria. I am not advocating the interests of that State. I am merely pointing out to the Senate that there are curious economic anomalies involved in this matter and that eventually, somehow or other, they will have to be tackled. I have been attempting to demonstrate this afternoon that the system whereby we are trying to help the dairy industry is a fallacious one because the subsidies are not based on areas where efficiency is being promoted. In reality, the efficient producers and the efficient processors of milk and cheese are being penalized because we are sustaining the’ inefficient elements in the industry which constantly are cutting the price in the domestic market. There are some hopeful signs in this respect, of course.

The dairy industry itself, on its efficient level, is trying to meet the problem of the over-production of cheese in Australia. For example, I think that the Japanese Government has been made a gift of something like 3,000 tons of high-grade Australian cheese to be used for lunches in Japanese schools. The leaders of the industry have told me that already this move has had a pretty profound effect in Japan, and they expect this particular phase of cheese promotion to improve. If we are to export cheese to markets such as that, we must manufacture cheese which the people in the countries concerned will want to eat. Not so very long ago - I think it was last year - there was in Australia a group of Japanese businessmen who were trying to discover where they could obtain Australian cheese to import to Japan. They wanted cheese which could be treated in a special way, such as by adding fish pastes to it, and so on. The Japanese businessmen travelled throughout Australia, and at every cheese factory they visited they were told: “ Yes, we can give you some cheese. Taste this.” A piece of cheese was cut off with a knife, and the Japanese were asked, “ What do you think of that? “ They were told, “ We can let you have it at so much per lb.”

The businessmen were about to leave Australia, but fortunately, before they did so they visited a group of Victorian factories where the manager asked them, “ What kind of cheese do you want? “ They were quite excited to hear some one asking them, as prospective customers, what they wanted, because in all the other parts of Australia they had been given a hard sell on cheese they did not want. The result was that the Japanese gave an order in Victoria for 2,300 tons of cheese.

Senator Wright:

– Did the Victorian factories manufacture to a special recipe?

Senator CORMACK:

– Yes. Flexibility of that kind must be introduced into the Australian cheese industry. Otherwise, not only will the cheese-producing section of the dairy industry fall, but also it will pull down with it the other sections of the industry.

Senator O’BYRNE:
Tasmania

.- The Opposition supports this bill, which is designed to increase the amount of the export bounty on various kinds of processed milk products, such as sweetened and unsweetened condensed milk, full cream milk powder, infants’ and invalids’ foods and malted milk. The bill that we are discussing will provide, in the year commencing 1st July next, for the amount of the bounty to be increased from £350,000 to £500,000.

I thought it was rather apt that Senator Cormack should refer to this legislation, as being like the wiring system of an old motor car. He said that the introduction of legislation such as this is like snapping off a little piece of old wire and replacing it with a new piece. In making that comparison he spoke words of greater wisdom than he perhaps meant to speak. This bill, and also a series of bills that has come before the Parliament in recent years, may be likened, not to the wiring system of an old motor car, but to the placing of pieces of leather on the harness of a horse and buggy. In so many ways Australia is suffering from a horse and buggy philosophy because of its Constitution. Our economic system is outdated and belongs to the horse and buggy era. This bill points to some of its inherent deficiencies. The introduction of legislation such as this is virtually like applying a piece of sticking plaster to a festering sore, the festering sore in this instance being the basic anomalies and inconsistencies in our economic system.

The measure before the Senate is a simple one in effect, but it has very important undertones. To bring some of those undertones into relief, I wish to refer to to-day’s edition of the Sydney “Daily Telegraph” newspaper. Under the heading, “ Ministers of Trade ‘ Glum ‘ “, the newspaper stated-

Commonwealth Trade Ministers left their London conference yesterday “ glum and silent “, the London “Daily Express” said to-day.

British delegates had told them more Commonwealth trade preferences would be eliminated, the paper said.

The head of Britain’s Board of Trade (Mr. Frederick Erroll) had forecast that more preferencesmust diminish, it said.

Australia and New Zealand already have agreed that Britain suspend tariffs on butter imports.

The “ Daily Express “ said Mr Erroll and Mr. Heath, at the conference yesterday “ quickly dispelled any idea that the British Government had plans for strengthening the Commonwealth trading system “.

Here, we see evidence of the fluid situation of the dairy industry throughout Europe and the Commonwealth countries. It is true that we have a responsibility to find alternative markets for our dairy products. It is our responsibility to see that, in a world in which there is poverty in the midst of plenty, we find markets for the dairy products which are the staff of life. Life begins far the human being with the flow of milk. The greatest substitute for human milk is cow’s milk. At a very early stage in a person’s life, milk takes its place in his diet.

At the present time, a freedom from hunger campaign is being waged throughout the world. The people of Australia are being made to realize in no uncertain terms the great problem of hunger in the world to-day. Is it not incongruous and anomalous that we should bc in a stew, politically and economically, in deciding whether our dairy farmers are to continue to milk their cows and produce dairy products to the fullest extent? There is no question that we must decide that the dairyfarmers should continue ‘to produce to the fullest extent. Any one who, for economic or other reasons, attempts to justify a policy that dairy farmers must not produce to their utmost capacity is betraying the trust that people have in a government. Over a period of years dairy farmers have been emancipated. Those of a past generation were in a rut. In the olden days they had, possibly, one of the worst jobs in the community. A dairy farmer had to be up early and had to work out in the elements in all weathers. The economics of the industry were such that he had to makeshift in every way. Often he could afford only poor quality cattle and his returns were very low. But a little bit of organization has come into the industry by way of a subsidy and a price which gives the farmer an incentive to improve his condition. This has produced results, and as a consequence, although we have gluts because of the changing nature of the market, they are only temporary. The subsidizing of butter and cheese production has brought about a tremendous revolution in the dairy industry.

It has been said that the main purpose of this bill is to divert milk at present being used to produce butter and cheese into the manufacture of processed milk products. At present there is very little evidence of any organized promotion of processed milk products, or for that matter of butter and cheese. Senator Cormack referred to the importation of exotic cheeses. As in the case of food and wine we have connoisseurs, and every one’s taste varies just that little bit. Thank God for that! If we all had to eat the same type of cheese life would be very dull. Because of the availability of an infinite variety of cheese flavours we can make a wide choice. I should like to direct attention to the fact that we can produce very fine cheeses in Australia. For years we have always taken it for granted that blue vein cheese must come from Denmark or Holland, but there is a cheese on the Australian market that is, I believe, equal to the imported product. It is known as Girgarre, and is made in Victoria. Although it is little known it always appears in our larder. I go so far as to say that very few people realize that we can produce exotic-type cheeses in Australia.

The industry has had to make do on a shoestring budget. Promotion costs money. Competing television stations and the multitude of newspapers and radio stations in various States make it necessary for any one conducting a campaign to advertise over the whole field. Members of Parliament know what it costs to put their propositions before the public; it is a very expensive exercise. The same thing applies to products of the dairying and milk processing industries. The industries will have to be organized. The initiative must come from the farmers themselves or through a properly organized instrumentality such as perhaps, the Australian Dairy Produce Board. Men of the calibre of Sir William Gunn of the wool industry will have to come to the aid of the dairy farmers and say in effect, “ We have a good product to sell, so let us set about finding a way in which to sell it “.

An important factor is that the milk products concerned in this measure are transportable and have good-keeping qualities. Our condensed milk has for a long time had a reputation for good-keeping powers and regularity in quality. The same thing applies to full cream milk powder. Not only in the cities and urban areas, but also right throughout the backblocks of Australia, people make good use of full cream milk powder. They now have a luxury that was not available to past generations.

Not only can the market in Australia be expanded by proper promotion but markets to our near north and in Asia generally can become more and more available to us. I refer particularly to the Indian market. A process is available whereby butter can be reduced to a type of oil known as ghee. Here we have a commodity which hundreds of thousands of Indian people are only too glad to buy. The question of cost, of course, is involved. Is it an economic proposition for us to produce ghee at a price at which it can be exported and the Indian people can purchase it? From experience I had with Indian troops during the 1939-45 war I know that when ghee came to them in Red Cross parcels in prisoner-of-war camps they looked upon it as a great luxury. They loved it. They felt they were getting something that was satisfying a deep yearning within them. 1 interpret that experience to indicate that the population of India is a potential market for our processed milk products.

I come to the next point: How are we to tap this market? When I was in the United States of America in 1953 I made it my business to look at the more modern types of dairy farm - perhaps not so much dairy farms as milk production units. I found that the old sloppy method of production of milk, with the cows up to their hocks in mud in the rain, and with production figures falling or rising as the temperature rose and fell, had gone by the board. The Americans place importance on three things. First they have a well-bred beast. The way in which they obtain a well-bred cow is by breeding for quality. They believe that it costs as much to feed a mongrel as it does to feed a thoroughbred, but that the thoroughbred will, on the average, produce more butterfat and milk than the mongrel. That proposition is denied by a number of farmers because they have old Millie or some other old cow who happens to produce a lot of milk. They have a sentimental attachment for these old cows and will not exclude them from their herds. On a purely economic basis the dairy farmer must go for quality in his herd. When you drive around the countryside in Australia you observe a tremendous number of dairy herds in which practically every colour in the rainbow is to be seen. You see the Jersey cross running through to Herefords and into Black Polls in the herd.

Senator Hannaford:

– You can get some pretty good cross-bred cows.

Senator O’BYRNE:

– The odd one, but give me a herd of pure breds - the butterfat producers like the Guernsey or Jersey, and the milk producers like the Holstein, Illawarra or Ayrshire. I will back my pure-bred herd against your herd of Brown’s cows any day of the week. However, I do not want to be diverted from the point I was making.

Senator Mattner:

– I would not mind taking you up on that.

Senator O’BYRNE:

– You would not; you are a horse-and-buggy man, so it is no good arguing with you.

Senator Mattner:

– I guess I have milked a thousand cows.

Senator O’BYRNE:

– It is that kind of mentality that is holding back our dairy industry. There are difficulties associated with artificial insemination, but we have before us the possibility of lifting the standard of our herds to the extent that we can get the best local, interstate or international breeds straight into our dairy herds. However, there are all sorts of complications in the process of artificial insemination. A lead should be given to the dairy-farmers of Australia to improve the standard of their herds.

My next point relates to the very casual approach to the science of dairy production, and I refer particularly to fodder conservation. There is a great waste in open grazing of dairy cattle. Pastures grow prolifically in the spring. Top dressing and other treatment give a great flush of pasture at a certain time of the year. Then out comes a herd of 50, 60 or 70 cows, every one of them with hooves that measure about four inches across. Every time they take a step they flatten an area .of about four inches by four inches - sixteen square inches - of pasture, which lessens its value. This is a very simple little example, but it gives an idea of some of the things that our dairyfarmers have to look at if they are to overcome this problem of cost of production.

There are wonderful organizations in this country that are producing equipment for ploughing, sowing, reaping and mowing, and others are building barns. Agriculturists are getting the know-how to grow more crops for conservation and are learning how to conserve them. In that way we can get the best from our well-bred cows. Instead of allowing the cattle to tread down a lot of good fodder which could be conserved, our dairymen should follow the example of the Americans who keep their dairy cattle in the barn or dairy shed for nine months of the year.

Senator Kennelly:

– What about the cost?

Senator O’BYRNE:

– The point is that the fields, which normally would have cattle grazing on them, can be used to grow crops.

Senator Hannaford:

– You mean the fields are under half an inch of snow. That is the reason for it.

Senator O’BYRNE:

– No. That is the practice followed in America, and the same will have to be done here. I have seen this system practised also in Europe.

Senator Mattner:

– Do you mean with the rotolac.

Senator O’BYRNE:

– No, but that is possibly one system that could be used. Unfortunately, the rotolac has only been able to pay its way by being a tourist attraction, but donot under-estimate the idea behind the rotolac.

Senator Ormonde:

– We have it in Sydney.

Senator O’BYRNE:

– The rotolac?

Senator Ormonde:

– Yes.

Senator O’BYRNE:

– However, that is diverting me from the point I was making. With an improvement in the breeding of cattle, with the conservation of pastures and the promotion of the sale of our dairy products, great savings can be made in the cost of production and distribution.

It is my opinion that the distribution of these products is mainly in the hands of people who have traditionally pressed up the market to its maximum by the charges they have made. On this important point, distribution, I must pay a tribute to many of the co-operatives. Senator Cormack spoke perhaps a little disparagingly of some of the co-operatives, not because of the cost of their commodities but because of their technique.

Senator Cormack:

– That is Complex B.

Senator O’BYRNE:

– The co-operatives should be encouraged to expand and develop to enable them to get the commodity to the consumer at the minimum cost so that more people will be able to afford to eat more of these basic milk products.

Another point of importance is the matter of promotion, to enable us not only to sustain our dairy industry at its present level, but also to expand it, because we have a responsibility, as a primary producing country, to become the larder of Asia. Australia has departments of agriculture in the States and has the Commonwealth Scientific and Industrial Research

Organization working to improve the breeds and technique. The farmers themselves have proved through the years that they can put up with pretty bad circumstances - they have done so in the past - but they are prepared to go ahead, if they have the incentive and that sense of security that has emancipated them. I believe that the subsidy, makeshift as it is, in the long run has emancipated the dairy farmer. It has given him and his family a new lease of life so that they can look into the future with confidence. The subsidy has also led him to improve his property to the extent where, instead of having ragged, ricketty old fences, broken-down gates and sloppy old cowyards, he has a property that has the appearance of efficiency and management. That is an advantage, and I believe it has come about because of the subsidy payable on butter fat used in the manufacture of milk products.

It is a strange thing that many people argue against the butter-fat content of milk and find fault in the practice of supplying to the public milk with a reasonable butterfat content. In New South Wales the Milk Board encourages a standard of milk with about 3.8 per cent. butter fat, that is, fats not solid. As a consequence, the consumption of milk has risen. The board’s most capable chairman, Mr. Jack Ferguson, has carried on a campaign to advertise the qualities of milk. He has engaged in all types of advertising campaigns, has encouraged the publicity of milk and has improved sales.

Senator Ormonde:

– He used to be a president of the Labour Party.

Senator O’BYRNE:

– A very respected president of the Australian Labour Party, a man of great discernment and intelligence.

Senator Mattner:

– What has that to do with it?

Senator O’BYRNE:

– That is just an aside. Now Senator Wright is trying to divert me with an interjection. If I were dealing with a subsidy on cheesecake I would choose Senator Wright as the next speaker.

Sitting suspended from 5.45 to 8 p.m.

Senator O’BYRNE:

– Mr. President, when the sitting was suspended for dinner we were debating the bill to amend the

Processed Milk Products Bounty Act. I had tried to make what I considered were essential points with regard to the dairy products of this country, particularly in view of the fact that we have to face up to the realities of the United Kingdom gradually abolishing preferences on our dairy products and many other of our primary products. I had made points which 1 should like to reiterate quickly. It is essential for Australia to continue to keep the dairy-farmer prosperous The position has been improved considerably. He has been emancipated from the horrors of dairyfarming in the bad old days. It is the nation’s responsibility to see that he has a proper incentive and proper facilities to produce this very vital product of the dairy in all its forms - milk, cheese, and processed milk products.

Before the suspension of the sitting I also spoke of the importance of bringing science to farming, and the drive to increase production which, in turn, would decrease costs. Every farmer should be assisted, if possible, by the various State government departments to obtain the services of very high grade bulls for the improvement of his herd and by such aids as a brucellosis eradication campaign. Every possible aid should be given by the State governments to the dairy-farmers.

Another point that I want to stress is the importance of the promotion of the sale of dairy products, not only in Australia, but throughout the markets of the near north, and in the east where our potential future markets lie. I believe that markets exist there for our products in ever-increasing quantities. It is a matter of breaking the existing economic barrier. Just as Sir William Gunn has launched a promotion campaign for the wool industry, so must the dairy industry get itself organized by a man of similar initiative who understands the industry and is able to get on with the job of selling more and more of its products. I was also saying before the suspension of the sitting that the sale of whole milk is of great importance to the industry. It is interesting that New South Wales which has a high percentage of butter fat or cream in its milk has greater sales of whole milk per head of population than the State of Tasmania which has a low butter fat content in its milk. The process of homo- genization by which the cream and milk are whipped in together makes milk more palatable as a drink. I am sure that much more milk could be sold if we undertook virile sales promotion campaigns and made high quality milk available to the public.

The Opposition believes that the bounty provided for in this measure is justified. We believe that we should never allow such an important industry as the dairy industry to fall back. It is part of our great responsibility to this nation and to the world to sustain it at the highest level. If we are to participate in freedom from hunger campaigns we must prove our suitability to retain this wonderful rich land. If we fail to do this we are recreant to our trust. Throughout the world there is poverty amidst plenty and, after all, in our dairy industry we have the potential to provide for plenty. I bid this bill a speedy passage and give it our support.

Senator DRAKE-BROCKMAN:
Western Australia

– Mr. President, in rising to support this bill, but before dealing with some of the points just made by Senator O’Byrne, I take this opportunity to express the deep sympathy of my Australian Country Party colleagues and myself to the people who have been affected by the disastrous floods in the north coast area of New South Wales. Having myself experienced floods during the time that I was on the land, I know the heartbreak that one must feel in seeing one’s land swamped by raging torrents, and the havoc that can be wrought by floods. It is a terrible experience to see soil that you have been cultivating by good husbandry swept away and carried down the river courses to the sea. lt is a terrible experience, too, to wake up in the morning and see the whole of your land covered by water; to look where your fences should be and find that they have been swept for miles down the river. When the flood waters recede and you carry out an inspection of the property and you see the devastation wrought by the flood, you really do not know where to begin. We in this corner of the Senate can feel sympathy for the flood victims, particularly those in the dairying area of New South Wales.

Last night, Sir, I had an opportunity to speak to two members of another place, the honorable member for Richmond (Mr. Anthony) and the honorable member for Lyne (Mr. Lucock) who, during the weekend, had visited their respective electorates and carried out an inspection of the flooded areas. Yesterday, in company with some other parliamentarians, they had made a flight over those areas. From the stories that they told me it seems to me that the condition of many of the farmers there is heartbreaking. We only hope that something is done in this place in the near future to give them some sort of compensation for the unfortunate circumstance in which they find themselves.

Having said that, Sir, I should like to touch on some of the points raised by Senator O’Byrne. Just before the suspension of the sitting, we heard some of Senator O’Byrne’s views on the problems that face the dairy industry. Having listened to him, I wonder why the Government has gone to so much trouble in bringing this bill before the Senate and in paying other subsidies to this industry. Senator O’Byrne gave me the impression that if the dairyfarmers of this country heeded his advice and- worked their farms in the way that he had worked his dairy farm, there would be no problems whatever facing the industry. He also indicated that the dairy industry contains a lot of inefficient farmers who do not know their job. Then he touched on problems of the promotion of the sale of dairy products. I say to the honorable senator that there is, in this country, no industry, and particularly no primary industry, which has achieved the absolute ultimate in the way of sales promotion. We all would like to see improvement in the promotion of the sale of our products overseas, but it is a case of economic factors. 1 remind the honorable senator that Australia spends about £460,000 a year on the promotion of the sale of its primary products in the United Kingdom and that a considerable part of that amount is spent on stimulating the sale of dairy products. In the Asian areas we have trade commissioners who are doing everything possible to sell our dairy products, particularly processed milk. Honorable senators may find information on this service in the “ Overseas Trading Journal”.

The dairy industry is sometimes called the Cinderella industry of Australia. Senator Cormack referred to the conditions that are enjoyed by the industry in Victoria. Compared with Western Australia, Victoria is fortunate. In Western Australia, the dairy industry is confined to the south-west corner which has a heavy rainfall and is heavily timbered, and farming costs there are heavy. This places a burden on the Western Australian industry. It was established after World War I., mainly with ex-servicemen in group settlements. I do not know what were the costs of clearing and preparing a dairy farm in those days but I know that they were far beyond the reach of the average dairy-farmer. The dairy-farmers still have insufficient finance to assure them of the minimum carrying capacity necessary to provide a living. Although the dairyfarmers of Western Australia are better equipped now they still suffer from lack of finance, and although they are slowly but surely getting on top of their difficulties it will take a long time yet to do so .completely.

Reference has been made to the report of the committee of inquiry into the dairy industry. I do not think any of us has the right to tell the dairymen that they are uneconomic producers and should sell out and find a job elsewhere. The problems must be faced squarely because of their economic impact, not only on the dairyfarmers but also on those who get their li-ing indirectly from the dairy industry in the south-west of Western Australia.

It is fair to say that while this Government has been in power the Australian dairy industry has experienced a considerable degree of security and prosperity which can be attributed in no small way to the fact that stabilization schemes have been successfully administered by the Government. Through these plans the annual income of the dairy-farmers has been almost doubled, mainly because of the policy of maintaining a subsidy on butter and cheese. I do not suggest that there is no room for improvement. I believe the industry faces many challenges, and one of these is the challenge to exploit more markets for Australian dairy products. These markets are highly competitive and will remain so.

We also face the problem of costs, which is a difficulty facing all exporters. The primary producer is not responsible for a considerable proportion of his costs. They are handed on to him through services provided to him, but I believe the dairyfarmers are making an energetic attempt to do something about costs by increasing the productivity of their herds. If they can succeed in that they will be in a far better position to compete on the overseas markets.

We must also face the problem of marketing. Senator O’Byrne said that the dairy farmers and the Government, through its trade services, must look for more markets; but while we are doing so we must think what we are going to make with the milk we produce and who will buy our products. I think we all realize that too large a proportion of our butter fat is going into butter and cheese, both of which protcts are difficult to sell overseas. Therefore, I am glad that the Government is trying to encourage the production of processed milk. This bill provides for continuance of an export bounty on processed milk products for a further twelve months from the end of June, 1963. It also provides for an increase in the maximum amount of bounty from £350,000 as at present to £500,000 for the 1963-64 season.

Senator Hannaford:

– Because of greater production.

Senator DRAKE-BROCKMAN:

– That is so. Honorable senators will recall that when the previous legislation came before the Parliament last year it followed a recommendation by the dairy industry that some Commonwealth assistance should be afforded to the export of processed milk products. The industry recommended this because it felt that if a serious decline in this trade were to be avoided the industry must be supported by the Government. It had been evident for some months that the manufacturers of processed milk products had been operating at a disadvantage with overseas competitors who were frequently heavily subsidized. As a consequence, Australian producers were having great difficulty in holding their share of the export markets. They were also being forced to s.-ll on those markets at a loss.

The exporters attributed this situation largely to the price, they had to pay to suppliers of milk. They claimed that they had to compete with butter and cheese factories and had to pay milk producers a price comparable with that paid by butter and cheese factories. As honorable senators know, suppliers of milk to butter and cheese factories not only receive a government subsidy but also benefit from the fact that the factories they supply receive an equalized return from domestic and export sales. The price received for the product that is sold on the domestic market is greater than that received for the exported commodity. On the export market, the milk processors have to compete with such countries as the Netherlands, which is the main exporter and which heavily subsidizes its industry. It will be recalled that some manufacturers told the Government that, if some assistance were not given to the processors for the exported product, they either would have to cease exporting or would have to close down their factories. That caused a problem for the dairy industry. The representatives of the butter and cheese sectors of the industry approached the Government. They were alarmed at the situation. They were afraid that, if these processors ceased operation, there would undoubtedly be a big diversion of butter fat to the butter factories - a sector of the industry that was already seriously over-supplied.

The Government decided to introduce the payment of a bounty. It is now proposed to extend the period of operation of the bounty for a further twelve months and to increase the amount paid. I am very pleased to see the Government take this step, because I believe it will provide a great incentive for the industry and perhaps will solve a very grave problem that confronts us. I have much pleasure in supporting the bill.

Senator MATTNER:
South Australia

– This is a very short bill, and I have pleasure in supporting it. Its main feature is the proposal to increase the bounty for 1962-63 to a total of £350,000 and to provide for a bounty of £500,000 for next year to compensate the producers of whole milk whose product is sent overseas in a form from which it can be recombined. I would not have entered into this discussion were it not that a lot has been said about the bounty, or subsidy, that is paid to the dairy-farmer.

Senator Wood:

– And about cheese.

Senator MATTNER:

– I shall also touch upon the subject of cheese, because it has had a fair airing in the Senate to-day. Let me tell my friend from Queensland that I do not know of any money which has been expended to better advantage than the subsidy that is paid to the dairy-farmer. I was quite delighted to hear Senator O’Byrne mention that fact in his speech. Until ten or fifteen years ago dairying was a Cinderella industry. I suggest that those people who question the rate of the subsidy should quietly reflect upon the way in which it has been applied by the recipients.

Senator Hannaford:

– Some of the great industries have sought assistance.

Senator MATTNER:

– Yes. Even in the great wool industry efforts have been made to obtain assistance. However, that is beside the point. As I travel throughout the length and breadth of Australia and see how the farmers are utilizing the subsidy to improve their herds and pastures, and to provide better milking sheds and equipment, I am fortified in my belief that the payment of the subsidy is one of the best things that has happened to the industry. The improvement is reflected in the ability of the majority of the factories, cooperative and otherwise, to handle the product in a much better manner. When we look at the townships and towns which are wholly dependent upon the dairy industry, and when we see the marked increase in the prosperity of every one concerned, does anybody want to see that prosperity removed? What would happen to the 600,000 persons who are actively engaged in the industry, the 14,000,000 cows which enter the milking bails twice a day, and the whole milk that is produced? If that milk were to flow into Adelaide, it would cover the whole city to a depth of 8 feet.

Reference has been made to fancy cheese. We have been chided because the consumption of fancy cheese imported by Australia has increased. Nobody denies that that is so, but our manufacturers are making a mighty effort to capture a lot of that trade. It is interesting to note, in passing, that, although Victoria is one of the biggest milkproducing States in Australia, in that State it is necessary to get a permit to manufacture fancy cheese. That is one of the problems which confront the industry, but I shall say little more, about it at the present time. I cannot produce figures to show how much fancy cheese is being manufactured in Australia, but I can assure Senator Kennelly that the quantity is increasing. The manufacturers know that the market within Australia for fancy cheese, which is worth £1,000,000 a year, is worth having. But it is necessary to import cheese makers. I have recently visited some of the exhibitions of fancy cheeses, and of other cheeses which our manufacturers have produced, and have been astounded by the variety and the quality. The fancy cheeses that are imported by Australia come from 30 countries, one of which is New Zealand.

We have heard a lot about the consumption of cheddar cheese. The home consumption of this commodity totalled 25,000 tons in 1958-59 and 32,000 tons in 1961-62, an increase of approximately 33 per cent. Although the consumption of cheddar cheese has not risen by the same percentage as that of fancy cheese, nevertheless it is increasing. Reference has been made to the grading of cheese. Over the past seven years there has been a steady improvement of the quality of cheese which we have sent overseas. A lot has been made of the fact that the choicest cheese represents only 8.3 per cent, of our production. New Zealand, which is a great cheese producing country, does not do very much better than that. Last year, our firstquality cheese represented 82.7 per cent, of production. The difference in price between choicest and first grade cheese is about 5s. a cwt., which is just a fraction over id. per lb. The price of first-grade cheese is £222 a ton. There is very little difference in the prices of second and third grade cheese, which account for 8.1 per cent, of our total exports.

We have had difficulty in selling cheeses, whether fancy or cheddar, but our producers and others engaged in the industry have sought to sell butter fat overseas in the form of re-combined milk. The Australian Dairy Produce Board has established in Manila, with the aid of local finance, a processing plant to re-combine milk. The board has loaned money, which it may convert into capital if it so desires. It has a directorship and appoints a manager. Plans are in hand for the establishment of a factory in Bangkok, which will have a Tasmanian manager, and other factories are planned for Malaya, Hong Kong, Singapore and Burma. The board desires to establish factories in near-neighbour countries which have stability. These will take thousands of tons- of butter fat off the Australian market. The success achieved so far has been gratifying and it seems that greater use will be made of milk in this recombining process.

Senator Hannaford:

– What’ do you say about the inefficiency that is supposed to exist in the industry? I do not say that there is inefficiency, but I am wondering what your viewpoint is.

Senator MATTNER:

– There may be some inefficiency. If there is, it has been brought about because the persons engaged in the industry have not had sufficient capital for the improvements that are so necessary. Because of the subsidy, the industry has been stepped up. It is now not a Cinderella industry but a mighty important overseas income earner for Australia. It gives the Australian public some of our best products in the form of milk and cheese.

This avenue of disposing of dairy products is a valuable one. Having seen one of these factories, I say that they are the best means we have ever had of showing goodwill to our near neighbours. We are supplying to them at a reasonable price reconditioned milk, a product that they want. This will do more good for our public relations, perhaps, than has any other bill we have had before us this session. I wholeheartedly congratulate the Minister upon making this contribution towards enabling the dairy industry to remain alive and be a very important industry for Australia.

Senator SCOTT:
Western Australia

– I, too, rise to support the bill. I shall not delay the Senate for very long, but I wish to make a few remarks. This measure to increase the bounty by £150,000 a year, from £350,000 to £500,000, is an example of the Governments’ generosity to the dairy industry. Butter fat producers are receiving about £13,500,000 by way of subsidy. This subsidy of £500,000 this year, plus a further £500,000 next year will help producers of processed milk and bring them into line with butter fat producers. We can look back with complete and utter satisfaction upon the measures that have been introduced by the Government, since I have been a member of the Senate, to help farmers, including dairy-farmers.

In 1946, the Labour Government established the Joint Dairying Industry Advisory Committee, consisting of six producer representatives, one Prices Branch representative, one Treasury representative, and one representative of the Department of Commerce and Agriculture. It took evidence from representatives of dairy-farmers throughout Australia in an effort to find the cost of producing 1 lb. of butter fat. The committee returned a majority recommendation that producers should receive 2s. lid. per lb. However, the Labour Government heeded the minority recommendation of the representatives of the Treasury, Department of Commerce and Agriculture, and Prices Branch, that the price should be 2s. per lb. This Government has always endeavoured to look after the producers and has taken notice of representations of sections of the industry. If a dairy-farmer does any fencing or builds a shed, or a home for his employees, he has the benefit of a depreciation allowance of 20 per cent, a year. That was unknown before we came into office.

Senator O’Byrne:

– Since you have been in government, they have not had enough money to build houses.

Senator SCOTT:

– Some little time ago we talked about what this Government had done in relation to housing. The honorable senator, I am sure, realizes that a record number of houses is being built each month.

Senator TURNBULL:
TASMANIA · IND; AP from Aug. 1969; IND from Jan. 1970

– It is a record, but it is still insufficient. It is 100,000 short.

Senator SCOTT:

– We had a debate on the subject of housing a short time ago, and the honorable senator remembers what was said then as well as I do. We are building houses at the rate of 100,000 a year at the moment-

The DEPUTY PRESIDENT (Senator McKellar). - Order! The honorable senator should return to the bill.

Senator SCOTT:

– Thank you very much for your protection, Mr. Deputy President. I want to come back to the bill and to refer to some of the terrible things that have happened to people engaged in the primary industries of Australia, including the butter producers.

I extend my sympathy to the people living in the northern areas of New South Wales which recently have been inundated by floodwaters. The people who live in the south-west of Western Australia had a similar experience a couple of years ago. Because of the short production season in Western Australia, the farmers who are producing cheese and other dairy products are finding it very difficult to produce them at payable prices. I think that the average cost of production is higher in areas with short rainfall periods than it is in areas where the rain falls over a longer period and the dairy-farmers are able to milk their cows for eight, nine or ten months a year. Since the average cost of production is based on costs over the whole of Australia, the farmers in the low production areas are helping considerably those in the high production areas. Therefore, the dairy-farmers in the small State of Victoria are quite satisfied with the position. They are doing remarkably well on the prices they are receiving at present for the dairy products they produce, whereas dairyfarmers in other areas, such as those in Western Australia, are experiencing great economic difficulty.

The Government of Western Australia has decided in the last few years to increase the area under cultivation, so that dairyfarmers may be able to milk a greater number of cows. That is being done by the State Government as a means of helping industry. This measure that we are discussing to-night will help the dairying industry as a whole and particularly the section of it which is engaged in processing milk. It will help our milk processors to compete with milk processors in other countries where the production of milk products is subsidized, and it will also assist the producers of butter fat and cheese.

Senator WADE:
Minister for Health · Victoria · CP

– in reply - I am greatly indebted to the Senate for the reception it has given this bill. Not a word of criticism has been offered from either side of the chamber. Having said that, I suppose there is little more to be said by the Minister in charge of the bill. Nevertheless, construc tive speeches have been made and some comment is called for. Most of the speakers in the debate have made very thoughtful and, perhaps, valuable contributions to the welfare of the dairy industry. Perhaps I had better exclude from that general statement a proposition that was advanced by Senator O’Byrne in the course of some rather novel criticism that he made of the old dairy cow. He suggested that her feet were so big that she trod much fodder into mother earth ‘ and that something should be done about the matter.

During the suspension of the sitting for dinner I gazed into the crystal ball to see whether I could find a solution to the problem. Perhaps Senator O’Byrne himself has some suggestion to make. No doubt he has read of the little females in certain Eastern countries who, at birth, have their feet tightly wrapped in bandages to prevent them from growing. The idea is that this particular form of beauty will make the girls attractive to males and ensure them a happier future. If the honorable senator is suggesting that that treatment should be applied to the cloven hoof of the dairy cow with the idea of making a great advance in the dairying industry, perhaps I shall have an opportunity at a later stage to ask him just what he has in mind on this theory for improving Topsy.

This bill has been introduced for the purpose of increasing the bounty on processed milk products from £350,000 to £500,000 a year. The Government has taken this step in an attempt to meet competition in world markets from other countries which are adopting similar measures to make their products competitive. Senator Kennelly raised a very interesting point which has been causing concern to quite a lot of people in Australia. He asked, in effect, “ Why do we permit the importation into Australia of cheese of various kinds when we have fairly substantial unsold stocks of our own cheese? “ He emphasized, of course, that the cheese to which he referred was of special kinds. There are several reasons why the demand for fancy cheese is increasing. It is true, as the honorable senator said, that the demand is in fact increasing. As a matter of fact, in the last three years importations of cheese of this kind have doubled. To-day, their value is about £1,000,000 per annum.

I am sure it will be agreed that this country has benefited tremendously from the influx of new Australians who are coming here in large numbers. It is fair to say that they have their own peculiar fancies in eating and drinking. I should like to think that, if we went to live in some other country, the first thing we would do would be to ask for some Australian cheese, some Australian wine, or some other product of our homeland. The desire for those things is inherent in us. I think that that is one reason why there has been such an increase in the importation of cheese of special kinds. I proceed to the point that because those people have demanded in Australia the types of cheese to which they were accustomed in their homelands, they have created an additional demand for such cheese in the Australian community. We have tasted these special kinds of cheese and have found them to be good. We have sought them for ourselves.

It is appropriate at this stage to make some reference to the consumption of cheddar cheese in this country. As Senator Mattner has stated, the consumption of cheddar cheese has increased by almost 33i per cent, during the period to which I have referred. An increasing demand is being built up in Australia not only for cheddar cheese but also for other varieties of cheese.

Senator Benn:

– The use of margarine is increasing, too.

Senator WADE:

– We are not discussing margarine. If the honorable senator wishes to bring that subject into the debate, I think he should ask himself bluntly: Which is making the greatest contribution to the Australian economy - margarine or butter? If he is frank with himself, I think there is only one answer he can make. Let us keep things in their correct perspective when we are dealing with this subject.

There are signs that the production in Australia of these special varieties of cheese is increasing, and, as I have said, the demand for them has grown tremendously in the last few years. For a long time now Australia has been, perhaps, a little complacent about the cheese and butter it produces. We know they are good by our standards, and we say they are as good as similar products anywhere in the world. The fact remains, however, that if we are to meet world competition, either at home or abroad, it is necessary for those who manufacture and process dairy products to be prepared to meet the demand. They must be ready to produce a special product for a special market or a peculiar taste. It might well be said that, while we are saying to the dairy industry in this debate, “ You are making a magnificent contribution to the economy of the country “, we also are inclined to say, “ You can do even better “. The challenge that is abroad to-day is one that does not brook any apathy. Whether we produce motor cars, butter, textiles or anything else, the whole world to-day is fighting for markets, and as a young and great trading nation we have to do all we can to meet the situation. I am sure that we can meet the challenges, but the only way is by facing the facts as we see them. This debate must be of real value to the industry when it is considered in that light.

The only other comment I want to make is in reply to the very constructive contribution made by Senator Cormack. He featured the variations in the quality of products of the dairy industry. He cited cases by nom-de-plume, as it were.- For very good reasons he talked about complexity A and complexity B. It is therefore hard to pinpoint any area, and I have no desire to do so. He did make the point that in certain areas where soil composition is identical, climatic conditions are similar and the herds identical, there was a variation in the qualify of the product. That is something that can, and should, be eliminated. It is a luxury that this country cannot afford to carry. Some one might ask: What is the Commonwealth Government doing about it? Let me remind honorable senators that in this field the jurisdiction of the Commonwealth is greatly limited because these are features that are controlled in the main by State governments. But I say quite frankly that I believe the Commonwealth Government has a role to play in this field. The Australian Agricultural Council is representative of all States and the Commonwealth, and things like this, I believe, will occupy the attention of that body. I know that the scientists of the Commonwealth Scientific and Industrial Research Organization are concerned about variations in the qualify of products. I know, too, that the scientific officers of the Department of Primary Industry are interested in these things.

Finally, 1 believe that this debate has served a very useful purpose. Whilst as a Parliament we have paid tribute to the contribution the dairy industry is making to the economy we have tried to be constructive in the things we have said. We have highlighted the fact that Australia generally to-day is facing highly competitive markets both at home and abroad. We have asserted without fear of contradiction that the Australian producer has the know-how, can produce a quality product, and has the initiative to meet competition. We are confident that as time goes on he will do just that. I commend the bill to the Senate.

Question resolved in the affirmative.

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

page 461

INSURANCE BILL 1963

Second Reading

Debate resumed from 14th May (vide page 391), on motion by Senator Paltridge -

That the bill bc now read a second time.

Senator COOKE:
Western Australia

– The bill seeks to amend the Insurance Act 1932-1960 in certain particulars. It is interesting to note that in the principal act “ insurance business “ is defined as follows: - “ Insurance business “ means the business of undertaking liability to make good, or indemnify against, any loss or damage, including liability to pay damages or compensation, contingent upon the happening of a specified event, and includes any business in relation to insurance business as so defined, but does not include- . . .

Then life assurance and other forms of insurance are named as not being included.

This bill is a most important measure. The amount collected in premiums in Australia under insurance covered by this bill is about £210,000,000 a year. It is derived from many sources. An amount of £8,500,000 is in respect of householders’ comprehensive insurance, £12,000,000 comes from fire insurance premiums and £35,000,000 from other types of insurance.

Senator Wright:

– Those figures are quite wrong.

Senator COOKE:

– I understand that the general consensus of opinion is that about £210,000,000 is collected annually.

Senator Wright:

– That total figure is quite right.

Senator COOKE:

– The amount is split up into various divisions. It is important that the liability of the insurer should be clearly stated in the act, because insurance is ah integral part of our economic system and is just as important to the security of the people of Australia as is the stability of the banks. People should be protected by insurance legislation just as they are protected by legislation governing banking. Whilst Senator Wright may not agree as to the amounts of premiums paid under each division of insurance, he is agreed that the total amount collected yearly in insurance premiums is about £210,000,000.

I have had association with insurance business and I know that the vast majority of offices in Australia are solid and secure. I am sure that insurance underwriters probably make a different assessment of the value of premiums from that made by the Government Statistician. Reinsuring between big offices is an art. It is a most intricate business. Offices must decide how much risk they can carry. Certain insurance transactions have become almost an actuarial business for insurance companies. It is not a simple matter to define upon whom the greatest burden will fall if an insurance company becomes insolvent, but it is lamentable that at the present time an insurance company should be able to become insolvent. Honorable senators will find as they peruse the second-reading speech of the Minister for Civil Aviation (Senator Paltridge) that this bill does not propose to increase the protection of the policy-holder or the insured; it merely gives a different order of precedence to payments from the sum held by the Treasury as the security or deposit paid by the insurance companies to the Treasury.

Senator Wright:

– The bill gives absolute preference for the payment of the claims pf the policy-holders.

Senator COOKE:

– I shall proceed with that thought and develop it. In section 11 of the act of 1960, which is to be amended by this bill, provision is made for a deposit to be paid to the Commonwealth Treasurer. The provision states -

The deposit required to be made and maintained by a person under the last preceding sub-section shall not, in any case, be less than One thousand pounds or more than -

  1. in the case of a person other than a foreign company - Eighty thousand pounds; or
  2. in the case of a foreign company - One hundred thousand pounds.

Section 13 states - (1.) A person (other than a company to which the last preceding section applies or a person to whom section thirteen A or thirteen B of this Act applies) not carrying on insurance business in the Commonwealth at the commencement of this Act shall, before commencing to carry on insurance business in the Commonwealth, deposit with the Treasurer approved securities to the value of Five thousand pounds and shall, while carrying on insurance business in the Commonwealth, maintain on deposit with the Treasurer approved securities to that value. (2.) Subject to the next succeeding sub-section, a person who has made a deposit in accordance with the last preceding sub-section, in respect of insurance business carried on by him, shall, after making the deposit, from time to time as prescribed, deposit and maintain on deposit with the Treasurer approved securities to the value of One thousand pounds for every Five thousand pounds by which his annual premium income exceeds Twenty-five thousand pounds. (3.) The last preceding sub-section does not require a person to deposit or maintain on deposit with the Treasurer approved securities to a value exceeding Eighty thousand pounds.

That is the wording of the act as it was amended in 1960. Section 3 (5.) of the principal act, as amended, states -

For the purposes of this Act, a person who has at any time carried on insurance business in the Commonwealth shall be deemed to be so carrying on insurance business until the liabilities (including contingent liabilities) of that person to policy owners in the Commonwealth have been met to the extent required by law.

So it appears that the original act envisaged that there would be protection for the policy holder in every department of insurance. If the insurer failed to keep the contract or went into liquidation such portion of a premium as remained paid for insurance cover during a period after the insurer became insolvent would be refunded to the insured. Such a condi tion would be written into a policy, whether the policy related to fire, marine or accident insurance covered by this act.

The Minister stated in his second-reading speech -

The essential feature of the Insurance Act is the requirement’ that insurers operating in the general insurance field must lodge deposits with the Commonwealth Treasurer. Those deposits are wholly charged in favour of policy owners and may be used by the Treasurer to settle claims under policies, provided that the policy owners concerned first obtain final judgments against the insurer in respect to such claims . . . -

Most insurance policies contain a clause to the effect that if the policy is cancelled by the insurer before its normal term expires, that proportion of the premium appropriate to the unexpired period of cover, will be refunded to the policy owner.

I understand that the Crown Solicitor has advised that in the winding up of several companies it has been found expedient to make it very clear that claims for such refunds of premiums qualify for payment out of the deposits held by the Treasurer. The Minister said -

This bill, therefore, provides that claimants for these small refunds of premiums will not share in the distribution of the deposit. It removes a preference which was not intended to be given.

Although we were at variance about what I was trying to make clear to the Senate previously, I think the Minister’s words make it clear that a priority will be given to claims in respect of risks insured, notwithstanding the provisions of the contract in those policies that the insured will obtain from the insurer a pro rata refund of premium in respect of his policy if it no longer covers the whole period for which the contract has been made. The Government admits, and the Opposition for many years has considered, that insurance is so important that the act should be looked at continually and revised so that protection can be given. That has been acknowledged by the Government to the extent that the Minister has stated -

Since this act was last amended some three years ago, several insurance companies in Australia have become insolvent.

That is true, and I hope to give particulars of those companies shortly -

  1. . However, it believes that this particular weakness in the existing act should be removed at this stage so that the deposits lodged by those companies that are now in liquidation can be applied by the Treasurer solely for the benefit of those policy owners who have lodged claims in respect of the risks insured and who’ in many cases badly need the consequential financial relief.

The Opposition is sympathetic with that view and does not intend to vote against the bill. The Minister continued -

This amendment will not apply to those companies that have entered into, or are in the process of entering into, schemes of arrangement with their creditors. As the creditors concerned, including the claimants under policies, have given their formal consent to them - indeed, in one case the New South Wales Supreme Court has approved the scheme - it is not considered that they should be disturbed at this stage.

That is an admission that the Government is fast closing the gates after the horse has got out. Nevertheless, I think we can agree that it is most important that the Government look at the Insurance Act in its entirety, see that the contract made by any insurer can be honoured in full and ensure that the insured is given thorough protection. It is also necessary to ensure that any person paying a premium to an insurance company shall be fully protected. Such a provision must be included in the act at some stage. The Government says that it it intends to include it, but not for some considerable time.

Six insurance companies have been wound up, or are in the process of being wound up, in the last five years. For a considerable time before that, very few insurance companies became insolvent. There has been a flush of insolvencies over the last five years involving six companies. Proceedings are now in hand to make a scheme of arrangement,’ or winding-up proceedings will be taken with the court in the future. Four associated companies also became involved, but liquidation proceedings were avoided as the creditors agreed to schemes of arrangement. The court has given its formal approval to the principal scheme which covers, in effect, the securities of three companies, and it is expected that it will be likewise in the case of a fourth associated company.

Recent figures showing the present financial position of the companies in liquidation are not available. Their assets are in the process of realization and the claims are still being examined by the liquidators. In some cases disputed claims are awaiting decision by the court. However, the latest available figures, some of which have been estimated by the liquidators or claim directors, can be given to the Senate. The figures disclosed a very serious position in relation to this matter. In the main, these are small companies that have sprung up. I should think that it would be the desire of the stable insurance companies that something be done to prevent such companies as this from operating and flourishing for a time.

There is another aspect which should receive the attention of any government. That is the practice of smaller insurance companies combining with an industrial or retail selling organization, or finance company, in order to place duress on the purchaser of an article on hire purchase to insure the goods with the particular insurance company which is associated with the selling company. In many cases a stable insurance company may be. associated with such transactions. But in many cases an unstable insurance company is concerned, and this is a very bad practice which should be eliminated.

The first company, particulars of which I wish to place before the Senate, is the Liberty Insurance Company Limited, in liquidation. Excluding approximately £13,000 in claims! for which proofs of debt were not received by the liquidator, the deficiency to 31st December, 1952, was estimated at £7,000. These figures take into account the sum of £37,596 17s. held by the Treasurer, representing the proceeds of the sale of the securities deposited with him by the company. In this case, a scheme of arrangement has been agreed to by creditors and it is expected that the liquidation will be stayed by the court. Under the scheme, unsecured creditors will receive 5s. in the £1, but claimants under policies will receive an additional amount of approximately 9s. in the £1 out of the deposit held by the Treasurer. If claims for refunds of premiums had not been entitled to participate in the distribution of the deposit, payments under policies in respect of risks insured would have been paid in full.

That case shows why the Government has considered it desirable to introduce .a measure such as this and why the Oppostion agrees that it should be passed. £ also shows that, in these circumstances, many small householders and other persons who have paid premiums would not be able to get a refund and would sometimes not be covered by ‘insurance when the company went into liquidation. They would have to raise the money to pay premiums to another company to cover the period already covered by the initial policy.

Another company that I wish to mention is the Seven Seas Insurance Company Limited, in liquidation. This is a subsidiary of Latec Investment Limited, and a winding up order in relation to it was made only on 22nd April last. A deposit of £52,000 is held by the Treasurer for the benefit of claimants under policies. It is understood that approximately 8,000 claims, totalling approximately £175,000, including claims for refunds of premiums, are outstanding in this case. The liquidator is unable at this stage to make any reliable estimate of the amount of the claims for refunds of premiums other than they will be considerable. There have been very many intercompany transactions which, will require close examination by the liquidator and it will be some time before the position is reasonably clear. In view of re-insurance and other arrangements between these companies, I think that this will be a very involved matter. This emphasizes the necessity for insurance companies to be placed in a position, by statute, in which they cannot evade their responsibilities to the insured.

Then there is the Australian Medical and Accident Insurance Company Limited, in liquidation. In the statement of affairs, the estimated deficiency is stated to amount to £57,628. The statement includes a deposit of £33,150 held by the Treasurer. The liquidator advised subsequently that the - known claims subject to determination would exceed the £54,906 previously estimated.

Another case in point is the Standard Insurance Company Limited, in liquidation. The total deficiency in this case has been estimated at £1,250,000. No reliable information is available as to the extent of the actual claims under policies. A deposit of £47,960 is held by the Treasurer and the court is dealing at present with a demand by him for a further £52,040.

Concerning Graham Sinclair Proprietary Limited, the liquidator has not been able to prepare a statement of affairs. A deposit of £6,000 is held by the Treasurer. The New South Wales police have laid 49 charges of fraudulent misappropriation of funds against the managing director, who was also the principal shareholder. No information is available to date regarding unsatisfied claims by policy-owners. That is a very unsatisfactory position. Whilst the Treasury receives a deposit in giltedged securities I wonder whether the amount of the deposit is adequate for the purposes of the bill. For certain companies, it is adequate. Nevertheless, the cases I have quoted provide proof that this matter should be examined. The law should lay down quite definitely that insurance companies should be scrutinized in relation to their directors, the administration of their funds, their association with underwriters, and their reinsuring of policies for which they accept liability so that policy-holders may be protected in every possible way.

Insurance is a big business which takes £210,000,000 in premiums out of the pockets of the Australian public each year. The payment of these premiums affects every man from the top to the bottom of our social structure. The small home-owner and the man with big business interests will both be severely affected if an insurance company with which they placed their business becomes insolvent. Those who pay premiums should be protected by law against loss arising from such a contingency. It behoves people to see that the insurance company with which they insure is a solvent, strong and substantial company. But many times people have to insure with a particular company at the dictates of a finance company or firm from which they are purchasing goods on hire purchase. Die person who knew anything about such transactions could probably avoid insuring with the company stipulated by the firm from which the goods have been purchased; but people are told that if they want the goods on hire purchase they will have to insure them with a certain company.

Another company that I wish, to mention is the Mercantile Indemnity Company Limited, in liquidation. This was a mush-, room company which did not survive, for very long. It was unable to meet the deposit requirements of the act and was forced into liquidation by the Treasurer. Its assets were negligible. The principal officer of the company was sentenced to throe years gaol for fraudulent misrepresentation and on other charges. So the initial act has done some good. The original act provides for some supervision of a company which seeks permission to operate as an insurer; but I think that the act should” go further. It should provide for the stability of the company to be examined. The deposits held by the Treasurer should be balanced against the liability of the insuring company. The total assets of the company should be sufficient to ensure that policy-holders will not suffer in the event of its liquidation. Special arrangements’ should also be made to cover re-insurance contracts between the companies themselves.

Another case concerns the Australian and Overseas Insurance Company Limited, Motor Traders Insurance Company Proprietary Limited, Nottingham Insurance Company Proprietary Limited and Nottingham (Workers’ Compensation) Insurance Company Proprietary Limited. These four companies are interlocked and the Treasurer holds a single deposit of £30,000 covering the deposit liability of all four of them. Probably they are re-insuring with each other and are operating with reputable companies which will relieve them of commitments to some extent, but they are all plying for business and all are covered by the same deposit.

The great majority of insurance business in the group I have referred to was written by the Australian and Overseas Insurance Company Proprietary Limited. It assumed direct liability also for its subsidiary company, the Nottingham Insurance Company Proprietary Limited and its sub-subsidiary Nottingham (Workers’ Compensation) Insurance Company Proprietary Limited. The statement of affairs shows that the estimated deficiency, of liabilities over assets, amounted to approximately £341,000. Under the scheme of arrangement which has been approved by the court unsecured creditors will receive approximately 2s. 6d. in the £1 while claimants under policies will receive an additional amount of at least 3s. in the £1 out of the deposit held by the Treasurer. Claims for refund of premiums exceed £100,000.

Little information is yet available regarding the position in the Motor Traders Insurance Company Proprietary Limited case. The estimated deficiency in the statement of affairs was £164,000. Claimants under policies will receive the same amount in the £1 out of the deposits as the claimants against the Australian and Overseas Insurance Company Proprietary Limited. There we see a number of interlocked companies covered by one deposit, under the parent act, of £80,000, while their liabilities would be almost unassessable. Their affairs could hardly be untangled, with straight out insurance companies operating through underwriters and re-insuring with one another. Independent companies offering policies to cover every liability shift their responsibilities from one company to another. One company insures with another, a policy is issued and held in the event of a claim. But the initial insurer is relieved of his liability so that he will not be carrying an over-burden of risk in one department of his business.

These things are vital. This is part of the financial structure of Australia, and it involves the security of hundreds of people, including poor people, home owners and pensioners who have a struggle to pay their insurance premiums. Probably not 80 in 100 make a claim, but to gain security against loss by fire or other disaster they have to try to protect themselves so that they can re-establish themselves in the community in case of need.

I do not think it is necessary for me to impress on any honorable senator that it is most important that there should be ari early .revision of the law. Early consideration must be given to the deposit held by the Treasurer. This consideration should go beyond whether the deposit is sufficient or insufficient. Every aspect of insurance should be studied. Companies which are insecure are starting in business. Many companies are quite stable and give a great service to the community and I believe that every person should have insurance; but it is a prime and important duty of the Government to see that no person can step out in business as an insurer- - and take money to provide compensation that cannot be covered adequately. People should be protected, even if it means establishing a national fund by insurance companies to ensure that every insurer is properly covered, lt is worth going to that extent to make sure that people who struggle to pay premiums for their security, as well as big businesses insuring for large amounts, are equally covered.

This measure is most important. It is a patchwork amendment of the act, but it is probably the best choice of two evils. It is well based and apparently it has been reasoned soundly by the Government and its advisers that the person who suffers most will get the most compensation. But there is no reason why legislation should not be drafted to provide that an insured who is likely to suffer because of maladministration in the insurance company or the company’s lack of funds will be covered for the remaining term of his policy. Alternatively, he should get some distribution from the fund. I understand that the Treasurer’s deposit will provide that an insured will get something from the residue. But I believe there is an urgent need for a full review of the Insurance Act to cover the deplorable weaknesses I have mentioned.

Senator WRIGHT:
Tasmania

.- This is quite a small bill, in my view, but it is set in a context of fire, accident, marine and general insurance, and that is quite important as a field of public responsibility. As I understand the measure, it revises the security provisions which were set up under the principal act as amended several years ago. The bill requires any company carrying on fire, accident, marine or general insurance to deposit with the Government £5,000 worth of securities as a condition of carrying on business. Then, for every £5,000 of premium income in excess of £25,000 the company is bound to add to the deposit security an additional £1,000, with a total limit of £80,000 as the ultimate security any company can be required to provide. That security is designed to act as some indication to the commercial community and the public at large that there is at least a government guarantee held in respect of every company carrying on this sort of business.

Here we have a bill which provides that where a company has gone into liquidation the security held by the Government shall be applied, not equally in satisfaction of all liabilities of the company at the time of liquidation, but shall be applied first of all in satisfaction of claims proved by policy-holders, to the exclusion of claims by policy-holders who have paid their premiums but whose loss is not crystallized before liquidation. By this bill there is a postponement in priority of their entitlement to be paid a proportionate share of their premium.

I note that there has been no criticism of the bill from any quarter in the House of Representatives or from the Opposition in this place. I do not wish to offer any criticism either, but I have gained the impression that the measure has been somewhat hastily conceived. I should be failing in my duty, as I see it, if I did not refer to a few matters which I should like to hear the Minister for Civil Aviation (Senator Paltridge) touch upon in’ his reply so that I may have an assurance that they have been considered and that the bill will operate satisfactorily.

Let us take the case of the Standard Insurance Company Limited, the recent insolvency of which has startled the commercial community. I understand that in this case and many other cases claims will be made simply under the commercial guarantees of hire-purchase finance companies. I just wonder whether those commercial houses have a greater right to payment than has the man who has paid fire insurance premiums amounting to £1,000 and who two months later, after the company has gone into liquidation, is left lamenting in relation to £800. Under the uniform company legislation which has been adopted recently in the six States of Australia with some degree of eclat, not the least on the part of the Commonwealth Attorney-General (Sir Garfield Barwick), distinctions are drawn in the priority of claims against insolvent companies as between wages and salaries owing by the company, workers’ compensation, rates and taxes. That order of priority is totally ignored in the case of a fire insurance company the only asset of which is the deposit that is lodged with the Government under the principal act.

I ask the Minister whether, as between claims for payment out of the security lodged with the Government, priority will not be given to claims for workers’ compensation or personal accident in contradistinction to properly claims. I am not saying that regard should be had to that order of priority, but I just raise the matter to test the general principle of equity which is said to be written into the act by this legislation. I should have thought that it was quite clear as a legal proposition, as the Minister has told us and as the Crown Solicitor has advised, that, when the existing legislation provided that the government security should be applied in satisfaction of liabilities to policy-holders, unpaid premiums would rank the same as unpaid claims. At first blush it seems to be a fair proposition, and I am not in the mood to accept responsibility for rejecting the measure, particularly in view of the unanimity that prevailed iri the House of Representatives and which seems to prevail here.

Senator Cooke:

– You did not accept my speech as being a compliment, did you?

Senator WRIGHT:

– The only comment I have to make about that speech is that it was utter confusion, and I warn everybody against reading it as being a reliable guide to an understanding of either the principal act or the amending legislation. I am endeavouring to make a contribution to the debate now because’ the Minister has said that although this amending legislation, which is of particular importance, has been introduced, we are to have later a considered and thoughtful review of the whole legislation. But there is nothing in the Minister’s speech which would excite us to think that that review will be placed before us in the near future. It will probably be submitted in due course.

I am putting forward this general proposition: Upon the liquidation of an insurance company, should the claims of policyholders be paid before payment of the unexpired portion of premiums in respect of which there is a claim? At first blush I would accept the proposition. But it seems to me that claims by commercial finance houses have not any priority as against the claim of a man who has paid a premium of fi, 000 to insure his premises . against fire and who, upon liquidation of the company, receives only £200 and has to take out another policy for £1,000.

I direct attention to the bracketing of all claims with no distinction being drawn as between claims for workers’ compensation, personal accident, loss by fire or finance underwriting claims. These matters warrant further attention. I direct passing attention to the fact that recently the High Court of Australia dealt with .priorities in relation to rates and taxes in the Commonwealth’s taxation legislation. The court said, that taxation in the nature of income tax, land tax, probate duty - that would not apply to a company, of course - or sales tax took “ absolute priority. In the bill now before us no attention has been given to reconciling the very complex problems that the High Court dealt with on that occasion. The court said that a bill to deal with the matter was very much overdue. No attention has been given in the bill to a priority for the payment of claims such as was set in the uniform company legislation. I do not want the Senate to Imagine that I am being critical of the measure. I believe that, if a general review of the relevant legislation is in the offing, each man- has a duty to express any thought which he may have to offer.

In view of the fact that there is to be a general review, let me offer a few general comments which are related not particularly to the bill but to the field of insurance which provides its context. The subject is one of importance, because, according to the statistics available as at February, 1963, the people of Australia pay £209,216,000 per annum for this class of insurance. Of that amount only £131,000,000 is returned to policy-holders in payment of claims leaving £76,000,000 which is otherwise accounted for. I have computed the amount paid in claims as representing 63 per cent, of the premium income. The figures which I have obtained from the Commonwealth “Year Book” for 1953, and which cover the period 1950-51, show that the premium income was £57,000,000 and that claims paid amounted to £27,000,000, or 47 per cent, of the premium income. It is interesting to note that the ratio of claims paid to premiums received has risen from 47 per cent, to 63 per cent.

Senator Cooke:

– Can you tell us what the overhead costs were?

Senator WRIGHT:

– I can give you only the management expenses for the current year. Out of the premium income of £210,000,000, expenses of management are £36,000,000, and commission and agents’ charges £19,000,000. Those are the signifcant figures. The figures given to me show that there are 150 registered companies throughout the Commonwealth. In the House of Representatives debate on this bill I have seen the number stated as 350 companies.

The economy of this industry, as illustrated by those figures, should prompt the question as to whether or not there should be some provision such as we have in the Life Insurance Act, whereby people have a right to inquire as to the expense ratio in relation to premium income. Do not let it be said that in suggesting that I am a defector from the idea of free enterprise and proper private enterprise. In order to ensure proper private enterprise, we have to make it such as commands integrity and confidence. I believe that the time has come when, in view of the multiplicity of companies, the obligations inter se, and the inextricable financial arrangements that can be made - as witness the Standard Insurance Company - some provision of that sort might be considered in addition to the present guarantee, for continued stability of these companies.

Senator Cooke commenced his speech with an extraordinary series of figures which I felt bound, in the interests of the integrity of “ Hansard “, immediately to deny. Just so that he will know the basis of my denial, I want to put on record one or two figures in relation to important departments of insurance, which I think should be taken into account for the purpose of any general review such as the Minister tells us is to be undertaken.

Last year, fire insurance premiums amounted to £35,536,000, and fire claims paid to £12,465,000. Householders’ comprehensive insurance premiums amounted to £11,900,000, and claims paid to £3,100,000. Premiums paid in respect of motor vehicles, other than motor cycles, amounted to £56,200,000, and claims paid to £37,600,000. Compulsory third-party motor vehicle premiums amounted to £25,900,000, and claims paid to £24,900,000. Employers’ liability and workers’ compensation premiums amounted to £43,600,000 and claims paid to £33,900,000.

Senator Cooke:

– The figures I was reading were the same for premiums paid. I did not give any figures for claims paid.

Senator WRIGHT:

– No, they were completely different. Do not muddle my figures by confused interjections, please. I am putting the figures for consideration by people who are interested.

It can be seen that motor vehicle insurance is making an inordinate drain on premium income to the disadvantage of orthodox fire and household insurance. We are all conscious of the trend, but, if a general review is to be undertaken, it is time there was a general re-adjustment in relation to each section of insurance, otherwise the motor vehicle insurance field will not be paying its fair share of the claims that it incurs. The maintenance of every department of insurance upon an equitable basis” is an essential contribution to proper commerce in this country, I submit.

As hire-purchase companies have multiplied, they have been prone to create their own insurance companies. That development has produced a very restricted outlook on the part of these particularized insurance companies. I believe that they have failed to carry on the general tradition of the larger companies that have always brought to the insurance field the attitude that a fair claim is fairly met. With some of these recent, puny companies, we get technical objections, which are not in consonance with the spirit of fairness but are based upon strict legalities. We see, too, rather unusual conditions introduced into their policies. Whereas a motor car owner may think that his car is insured for its full value, some of these companies have an artificial restriction either to the amount still unpaid on hire-purchase under the contract or to a. sum of £500.

These insurance policies have become very” complex. Although the theory is that the policy holder is supposed to read the policy, policies are so technical that even the most industrious person could not be expected adequately to understand them. Even trained legal men can differ as to their meaning. This prompts me to suggest that if a general review is to be undertaken, it might be considered proper to have some set form of policy for each type of insurance.

Senator Cooke:

– It would be very difficult in respect of stock.

Senator WRIGHT:

– I have no doubt that this thought needs further development, but I hope that the idea of a standardized policy for the different sections of insurance business will be considered so as to avoid the disappointment of people who rely upon their policies and then find that there are limitations in the conditions which they did not know or understand.

It is disquieting to find that in the last recent period nine of these companies have gone into liquidation. As to others, I think, schemes of arrangement are afoot. The Minister says that the amendment before us will not interfere with any scheme of arrangement yet made. . I infer from that that his intention is that the other provisions of the bill will operate in relation to liquidations already commenced. In all humility, I just express a doubt as to whether the terms of the bill do make clear that it operates in relation to liquidations already commenced. In relation to the payment of losses out of the deposit held by the Treasurer, I want to know whether or not re-insurance is taken into account, and whether or not the re-insurer is paid in full the quota of the claim that he has guaranteed by way of re-insurance, before the claim qualifies for contribution from the government security.

Although these failures are unfortunate, and such as to warn us that we should bring the legislation completely up to date to ensure security in future, the fact that liquidations are so few, the general confidence of the community in the insurance world, and the fact that premiums have risen from £57,000,000 in 1950-51 to £210,000,000 this year, with a vastly improved claim ratio, rising from 47 per cent, in 1950-51 to what I calculate to be 63 per cent, to-day, constitute a remarkable tribute to the efficacy and efficiency of the insurance business that is being transacted in the community.

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

– in reply- - The purpose of this bill, as I stated in my second-reading speech and as has been pin-pointed by both . Senator Cooke and Senator Wright, is to address itself to a single particular weakness that has been manifested during recent years.

Senator Cooke:

– And which needs quick correction.

Senator PALTRIDGE:

– If the honorable senator will allow me to make my own speech I think it will be better. The second-reading speech referred to the fact that, as a result of experience, particularly over the last few years, the Government has in hand a comprehensive survey of the whole scheme of insurance in Australia. It proposes to bring down a comprehensive measure as soon as possible. I am told that it is hoped that the measure will be before us before the end of the year. I emphasize that, at the moment, it is no more than a hope, but I take the opportunity to point out that it is the desire of the Government to bring the measure before the Parliament as soon as possible. For the purpose of introducing this comprehensive amending measure, investigations are being made in many other countries in order to produce a piece of legislation which, it is hoped, will be first class.

Senator Wright has referred to a number of matters in what he has described as the general context of insurance. I express my gratitude that he has done so. I assure him that his comments will be taken into account when the measure to which I have referred is being considered, both departmentally and at government . level. The honorable senator, raised the important question of the priorities which it is proposed to give to policy-holders with outstanding claims, as against other creditors of the affected companies. The Government, in reviewing the situation, exercised a judgment so far as the deposits held by the Treasurer were concerned. It decided that those with claims against the companies, because of their greater need, in a general way, than the other creditors, shall have first claim on those Treasurer-held deposits. That does not necessarily mean, of course, that the other creditors will find themselves with nothing available.

This scheme applies only to the deposits held by the Treasurer. I emphasize this because, at one stage of Senator Cooke’s remarks, I felt that he had not grasped this point. The other assets of the company will be a matter for distribution over the whole field of the creditors. In exercising that judgment the Government was persuaded by the fact that, by and large, in respect of this particular weakness and until such time as we are able to bring the comprehensive measure before the Parliament, this was the fairest and most equitable way to deal with the matter.

Senator Wright:

asked specifically whether the proposed amendment would apply to all those companies which were in the process of liquidation, or for which schemes of arrangement were being designed. The answer is: Yes, this amendment will have application to all those companies including one, I understand, for which a scheme of arrangement is currently in the process of formation.

I thank the Senate for the reception it has given the measure.

Question resolved in the affirmative.

Bill read a second time.

In committee:

The bill.

Senator COOKE:
Western Australia

– Proposed new sub-section (2a.), which the bill seeks to insert in section 3 of the principal act, refers to a liability to refund the whole or a part of a premium, or to any other liability arising otherwise than by way of insurance. I should like that provision to be explained. I think I understand it, but it was in respect of this provision that the Minister for Civil Aviation (Senator Paltridge) stated, in replying to the second-reading debate, that there appeared to be some doubt in my mind. Perhaps he will be good enough to put the matter beyond doubt. As I understand it, the bill provides that the first charge to be made on the Treasury fund that is held will be for claims which have been proved.

Senator Paltridge:

– Yes.

Senator COOKE:

– The bill does not say much about the extent to which proof will be required. The insurance company will be indemnified to an extent against responsibility for refund of premiums in whole or in part. The provision implies that if there is a residue after claims have been met, then a pro rata refund will be made in respect of premiums paid but for which cover has not been given, and the remaining moneys will be distributed after claims have been proved. Is that the situation?

Senator WRIGHT:
Tasmania

.- I began to consider this bill only to-day, so the deficiencies in my comments may be even more apparent than is usually the case. I direct the attention of the Minister to the fact that clause 3 of the bill seeks to insert a new sub-section (2a.) in section 3 of the principal act. That is the definitions section. The proposed new subsection states -

A reference in this Act to a liability under a policy shall be read as not including a reference to a liability to refund the whole or a part of a premium . . .

Let me pause there. As I understand the measure, the amended form of section 21 of the principal act is designed to give preference to the payment of claims and then to permit claims for refunds of premiums to come in against any unexpended part of the government security. Proposed new section 21 provides -

All moneys and securities for the time being deposited by any person with the Treasurer under this Act shall, subject to this Act, be and remain as a security for the meeting of liabilities of the person under policies issued by the person and shall not be liable for the meeting of any other liabilities of the person until the first-mentioned liabilities have been met in full.

Let us assume that we have a deposit of £80,000, that there is a loss of £40,000, and that there are unpaid premiums which are due to be paid back to the policyholders amounting to £20,000. I raise the question whether, by reason of the fact that in clause 3 amending the definitions section we have the words - liability under a policy shall be read as not including a reference to a liability to refund the whole or a part of the premium- the Government has prohibited payment at any time out of the government security of the whole or part of the premium by virtue of proposed new section 21. This proposed new section provides as follows: -

All moneys and securities for the time being deposited by any person with the Treasurer under this Act shall, subject to this Act, be and remain as a security for the meeting of liabilities of the person under policies issued by the person and shall not be liable for the meeting of any other liabilities of the person until the first-mentioned liabilities have been met in full.

The position is expressly stated in that proposed new section 21, but in the proposed new definition it is stated that a liability under a policy shall be read as not including a reference to a liability to refund. Is the Minister satisfied that the Government has achieved the point it set out to achieve? I am not so satisfied myself.

The other point I raise is a more familiar one. It deals with the restrospectivity of the act - its application to existing liquidations. From the framework of clause 6 it seems to me that clause 4, which introduces proposed new section 21, should apply from the date of the passing of this bill to any liabilities unpaid at that time. I should have thought that there is considerable doubt as to whether it applies to the payment of any claims unpaid in respect of a liquidation that commenced before the passing of this bill. I raise the question only because there is a specific assurance in clause 6 that it does not apply to deeds of compromise or schemes of arrangement entered into with creditors before the date of the commencement of the act. I should have thought that the proposed new section 21 would apply only in respect of claims which accrued under liquidations which commenced after the passing of this bill.

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

– I shall reply first to Senator Cooke. I hoped that I had made it clear that the priority accorded by the act applied to claims which had not been made by the company in liquidation, and that the claims had application to the deposits held by the Treasurer. That is stage one. In that stage only the premiums to which the honorable senator directed his comments would be taken into consideration. In stage two all the liabilities of the company would be a charge upon those assets of the company other than the Treasurer’s deposit, to which would be added any section of the Treasurer’s deposit not required for the discharge of the claims.

Let me acknowledge at once that I had difficulty in following the query raised by Senator Wright. As I understood it, he referred to the Treasurer’s deposit and cited a figure of £80,000. He assumed that of that figure £40,000 was required to discharge the claims that were outstanding and that there would be a balance of £40,000 which would be available for the discharge of claims other than claims under the policy.

Senator Wright:

– The question is whether or not, although it is the intention in respect of premiums to have access to that £40,000, by reason of the definitions section - where it is stated that a liability under a policy shall be read as not including a reference to a liability to refund the whole or part of a premium - you have prevented a person from having access to that balance.

Senator PALTRIDGE:

– I am assured that the definition does not have that effect for the reason that proposed new section 3 (2a.) refers to a liability under a policy.

Senator Wright:

– That is where I think the ambiguity arises, but I raised the point only so that it will not escape the attention of the Government by inadvertence. If the Minister is satisfied, I will not dispute the matter.

Senator PALTRIDGE:

– I am advised as I have indicated.

The amendment will apply to all liquidations whenever they commence, with the exception of the cases of those companies that have already entered into schemes of arrangements or have given notice of schemes of arrangement.

Bill agreed to.

Bill reported without amendment; report adopted.

Bill read a third time.

page 471

COMMONWEALTH INSCRIBED STOCK BILL 1963

Second Reading

Debate resumed from 14th May (vide page 392), on motion by Senator Paltridge -

That the bill be now read a second time.

Senator McKENNA:
Leader of the Opposition · Tasmania

.- The bill has two very simple purposes. It seeks to amend the Commonwealth Inscribed Stock Act which was first put on the statute-book in 1911. The act is somewhat archaic, but I understand it will be remedied in the near future. The difficulty arose over orders that are made by the Governor-General for the inscription of stock and the setting up of stock. I should like the Minister for Civil Aviation (Senator Paltridge), if he can, to indicate how proximate is the revision of the act that I understand is under contemplation.

The first purpose of the bill is to permit the inscription in inscribed stock registers, for the first time, of special bonds - bonds having a currency of up to seven years - and Treasury notes which are ordinarily limited to three months only. There have been reasons under the terms of the existing act whereby neither of these securities could be treated or accepted for inscription in the inscribed stock register. The amendments proposed by the bill will permit them to be so included.

There are advantages in that, of course, not only for those who prefer that mode of title, but also for the Government. It costs the Government a good deal of money to take out elaborate bonds, which in themselves constitute title for the amounts they mention, and to take out treasury-notes. Moreover, as there are no documents of title to lose, those who administer stock are saved a good deal of work in dealing with many cases where people lose their stock and where lengthy investigations have to take place before they can be replaced. So it is a matter of convenience to both the Government and the investors. The investor has not a document of title that he might lose; it is capable of easy transfer without production of title, and one cannot lose the title when that ownership rests upon the inscription in the name of the owner in the register.

It rather surprised me that there should be a need to inscribe notes with the short currency of three months, but I am told that this is a procedure that will be readily availed of and that a good many transactions will take place with those notes during the currency of three months. They pass about freely on the short-term money market, and it apparently will be to the advantage of investors to be dealing with inscribed stock in respect of treasury-notes, rather than in the notes themselves. There is no objection to that from the viewpoint of the Opposition.

The only other provision is to elaborate and extend the section which, at the moment, authorizes the registrar to pay stock on the death of an owner without production of probate or letters of administration, if the amount involved does not exceed £100. The bill proposes now to allow the amount to be fixed by regulation. We were told by the Minister for Civil Aviation in his second-reading speech that at the moment it is contemplated to lift by regulation the amount that may be so treated to the amount of £600, the amount which the Commonwealth Banking Corporation is free to deal with without production of probate or letters of administration. That is an improvement. There is no objection to that from the viewpoint of the Opposition, and I indicate that we support the measure.

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

– in reply - I think I am obliged only to reply to the query of the Leader of the Opposition (Senator McKenna) as to how proximate is a revision of this measure. I am informed that an examination is being made of overseas arrangements for the issue of securities, but that no firm outline of the new legislation has yet been prepared. The legislation will be complex, several associated acts being involved, and it will be some time before the review can be completed.

Question resolved in the affirmative.

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

page 472

ACTS INTERPRETATION BILL 1963 AND ASSOCIATED BILLS

Acts Interpretation Bill 1963.

Australian Antarctic Territory Bill 1963.

Christmas Island Bill 1963.

Cocos (Keeling) Islands Bill 1963.

Heard Island and McDonald Islands Bill 1963.

Seat of Government (Administration) Bill 1963.

Second Readings

Debate resumed from 14th May (vide page 394), on motion by Senator Gorton -

That the bills be now read a second time.

Senator COHEN:
Victoria

.- The Opposition supports the Acts Interpretation Bill 1963, which will make some necessary amendments to the Acts Interpretation Act, and the five complementary bills to amend the Australian Antarctic Territory Act, Christmas Island Act, Cocos (Keeling) Islands Act, Heard Island and McDonald Islands Act, and Seat of Government (Administration) Act respectively. The Acts Interpretation Bill, which is before the Senate, deals with three matters, one of which is common to each of the other five bills which all deal with that one matter only.

The Acts Interpretation Act is a very useful act. It is rather like a handyman’s guide through the labyrinth of words used in statutes. It is essentially an act facilitating the construction of other acts since it supplies definition and meaning to many expressions used in legislation. As the Attorney-General (Sir Garfield Barwick) said in introducing the bill in another place, its main usefulness lies in the economy of language that can be used in the other acts.

The first matter dealt with by this bill arises from the recent changes made in the Standing Orders of the House of Representatives. Standing Order No. 315 has been amended to include a provision that papers may be delivered to the Clerk of the House instead of being presented in the House, and the papers so delivered to the Clerk shall be deemed to have been presented to the House on the day on which they are recorded in the “ Votes and Proceedings “. The purpose of the amendment is to give effect to the House of Commons’ practice and so to save the time of the House of Representatives. I refer to the report of the Standing Orders Committee of the House of Representatives in which that comment appears. The committee points out in its report that it is intended that the new procedure should apply mainly to papers of a machinery character, and that the more important papers, particularly those where an immediate order to print is required - for example, a report of the Commissioner of Taxation or papers, the subject-matter of which is to be debated - shall be tabled openly in the House as at present. I want to say something about that matter a little later. This change in the Standing Orders of the House of Representatives gives rise to the present amendment.

As the Minister for the Navy (Senator Gorton), who is in charge of the bill, has said, this method of presentation would not satisfy the existing Commonwealth legislation providing for presentation of papers. The reason for this is that various expressions are used in the acts, for example, expressions such as “ present to “, “ lay before”, “table”, “lay on the table of”, and so on. Clause 2 of the Acts Interpretation Bill will insert a new section, 34b, in the act. As the Minister says, it makes the proposed new procedure of the House of Representatives as to the presentation of documents legally effective, and it will enable the Senate to adopt a similar procedure if it so desires.

That leads me to observe that the Senate has yet to adopt this procedure. It would require an amendment of Standing Order No. 361, which is in terms identical to Standing Order No. 315 of the House of Representatives prior to the recent amendment. I hope that the Standing Orders Committee of the Senate will give consideration in the near future to suitable amendments to the Standing Orders of this chamber so that the new provisions of the Acts Interpretation Act may be invoked to facilitate the presentation of papers in the Senate. I hope, too, that the words of qualification used by the Standing Orders Committee of the House of Representatives will be noted here when this task is undertaken. That committee stated that important papers should be tabled openly in the House as at present. I believe it is of the greatest importance that these things should be done openly and publicly and be subjected to the watchful scrutiny of honorable senators. The second matter covered by the amending bill, the Acts Interpretation Bill, is one to which I refer only in passing. That is the provision which will permit United Kingdom acts to be cited in Commonwealth legislation in the same way as they are in the United Kingdom. I do not want to elaborate on that. It is a proper provision and the Opposition supports it.

The final matter with which I wish to deal is one which is covered by all six bills. The Acts Interpretation Bill proposes to amend the provision of the principal act concerning disallowance of regulations made under Commonwealth acts. The amendments proposed are welcome and proper and, as I have said, the Opposition supports them. At present, section 48 of the principal act requires regulations to be laid before each House of the Parliament within fifteen sitting days of their making. They are disallowed if, within fifteen sitting days from being laid before the Houses, either House passes a resolution to that effect; or if notice of motion of such resolution is given within that period and at the expiration of fifteen sitting days from the giving of notice the resolution has not been withdrawn or otherwise disposed of. If, however, the motion has not been dealt with before the House of Representatives expires or before a dissolution or prorogation of Parliament, even if fifteen sitting days have not elapsed since the notice was given, then the opportunity of disallowance has gone for ever.

The Government is now taking steps, by proposing this amendment, to ensure that, where notice of motion to disallow a regulation is given in either House of Parliament in accordance with the provisions of section 48 of the act, the Government cannot avoid a vote on a motion for disallowance of which notice is given near the end of the session by keeping it at the bottom of the notice-paper until expiry of the House of Representatives or prorogation or dissolution of the Parliament. The effect of this amendment will be to keep the notice of motion alive so that the fifteen sitting days will date from the resumption of the Parliament or from the first sitting of the new Parliament, as the case may be.

The same amendment is made to the ordinances referred to in the other five acts. I have named them and I do not propose to go into them in detail. I think it is sufficient to say, referring to the speech of the Minister for the Navy when introducing this bill, that section 12 of the Australian Antarctic Territory Act is amended; section 10 of the Christmas Island Act, section 13 of the Cocos (Keeling) Islands Act, section 11 of the Heard Island and McDonald Islands Act, and section 12 of the Seat of Government (Administration) Act are amended. The ordinances that are the subject-matter of the amendments suffer from the same deficiencies as the relevant provisions in the Acts Interpretation Act. The same principle is involved. Similar provision is made in all these bills to meet the shortcomings. I should be interested to hear the Minister comment on the Government’s omission to make similar provision in the Norfolk Island Act. That is an act in which the present proposal, as I understand the position, does not appear. I would like the Minister to tell the Senate the reason for the omission.

I believe, Mr. Acting Deputy President, that what is proposed in these bills, particularly in relation to the disallowance procedures, constitutes a notable advance in the procedure for keeping executive regulations under the scrutiny of the legislature. I think it is particularly important in the case of the Senate - the House of review - the House which is peculiarly fitted to undertake such a scrutiny. This is the chamber in which a great deal of work in this field has been done by the Standing Committee on Regulations and Ordinances. The functions of that committee are set out at the beginning of each of its reports. They are as recommended by the 1929 select committee which was set up to look into the establishment of these committees. The functions of the Standing Committee on Regulations and Ordinances are described as follows: -

Since 1932, when the committee was first established, the principle has been followed that the functions of the committee are to scrutinize regulations and ordinances to ascertain -

that they are in accordance with the statute;

that they do not trespass unduly on personal rights and liberties;

that they do not unduly make the rights and liberties of citizens dependent upon administrative rather than upon judicial decisions; and

that they are concerned with administrative detail and do not amount to substantive legislation which should be a matter for parliamentary enactment.

The work of this committee, I believe, has been extremely valuable. It is a verycritical function of this chamber, which is peculiarly suited to it, to undertake the work of supervising subordinate legislation of this kind. That is why it is of particular importance that the Government should introduce amendments which will enable that function to be the better carried out. This is welcomed by the Opposition because our Standing Committee on Regulations and Ordinances will have more time and we will have more time, in some cases, as a Senate, to consider statutory regulations, as well as ordinances in the case of the Territories, and to see whether they trespass on the very vital principles that underlie the work of the Regulations and Standing Orders Committee.

I have made these general observations because they seem to arise in this particular way in the consideration of these bills. There are really two respects in which they are of especial interest to the Senate. First, because an early review of the Standing Orders of the Senate may well be involved in relation to the presentation of papers. 1 think that there should be such a review and I think it should be done at the earliest possible time. Secondly, the liberalization of the procedures under which regulations may be disallowed is of very special importance to this House of review. The Opposition supports the bills before the Senate.

Senator GORTON:
Minister for the Navy · Victoria · LP

– in reply- All I need do is express appreciation of the general support that has been given the bill on both sides of the House. Senator Cohen has raised two points to which I should refer. The first was whether the Senate Standing Orders should eventually be amended in a form approximating that in which the House of Representatives Standing Orders have recently been amended. As Senator Cohen knows, when the bill before the Senate becomes law it will cover the presentation of papers whether or not the Senate Standing Orders are amended.

Senator Cohen also referred to Norfolk Island. This matter has not been overlooked. It is not in this bill probably because a more comprehensive review of the whole act is contemplated and that would be more appropriate.

Question resolved in the affirmative.

Bills read a second time, and passed through their remaining stages without amendment or debate.

page 475

APPROPRIATION BILL (No. 2) 1962-63

First Reading

Debate resumed from 14th May (vide page 426), on motion by Senator Paltridge -

That the bill be now read a first time.

Senator BREEN:
Victoria

.- In supporting the bill I shall continue my comments on the plight of class A civilian widows. The report of the Director-General

F.3822/63.- S.- 119J

of Social Services for 1961-62 showed that recipients of the class A widow’s pension totalled 24,584, including 14,995 widows and 7,235 deserted wives. It is to be hoped that ways and means may be found to recover the maintenance owed by deserting husbands. In the meantime, their wives and children are dependent on the class A civilian widow’s pension.

A debt of gratitude is owed to the authorities who made possible the survey by Jean Aitken Swan. Although the survey was conducted in New South Wales it reflects the position throughout Australia. There are some widows who are in a somewhat satisfactory position, such as those who have their own homes or have a child earning and contributing to the family income. In some cases relatives are helping. But the survey showed that among the widows who were interviewed 29 per cent, had less than 10s. a week over and above their payments for rent and a low cost diet, while 52 per cent, had less than £1 surplus after the week’s budgeting for food and payment of rent.

This is borne out by the report of the Director-General of Social Services for 1961-62 which showed that of the total number of 24,584 shown as class A civilian widows at 30th June, 1962, 54 per cent, had more than one child. To make the position quite clear I should like to give the following percentages: 49 per cent, of class A civilian widows had two children, 28 per cent, had three children, 13 per cent, had four children, 6 per cent, had five children and 4 per cent, had six children or more. Of course, there is supplementary assistance, and 15 per cent, of the total number of class A civilian widows availed themselves of it.

State welfare departments give some supplementary assistance also. In Victoria, the class A civilian widow may require help at times to pay rent or hire-purchase commitments or possibly to maintain her hospital and medical benefits contributions. If a widow is working she may need to make a payment to a creche to care for her children. She can apply for relief. Her case is considered by the Social Welfare Department and she may receive from 5s. to 35s. a week for each child under fourteen years. If the conditions warrant it payment will be made for a child seventeen or eighteen years of age. But, with the help available from the Commonwealth and the State, that is not sufficient to enable a mother to care for her children adequately and to house, feed, clothe and educate them. Many of these mothers seek employment, mostly part-time, but the permissible income they may receive without affecting the pension does not bridge the gap between income and necessary expenditure. Again, many mothers of pre-school children feel that their children should not be deprived of the care of the mother as well as the father. They recognize that the emotional security of the child is of tremendous importance.

So, 1 urge that consideration be given to assistance and relief for the civilian class A widows by way of an increase in pension and in the allowance paid for children. I urge also that the means test be made more liberal by raising the income a widow is permitted to receive. Senator Dame Annabelle Rankin suggested a domestic allowance and I believe this also could receive consideration.

In supporting this bill I have spoken of the thousands of men, women and children of the developing countries who are in dire need. I commended the Government’s endeavours to alleviate their distress, and also the voluntary organizations which are trying to raise £1,000,000 for the FreedomfromHunger Campaign. Finally, I have referred to the plight of class A civilian widows, who are endeavouring to be mothers, fathers and breadwinners. I commend the case of these women to the Government and have pleasure in supporting the first reading of the bill.

Senator POKE:
Tasmania

.- I was quite interested to hear Senator Breen detail the plight of civilian widows. I was interested in the whole field of social service activity even before 1 became a member of the Parliament. Certainly I have had a better opportunity since I became a member of the Parliament to bring the plight of the pensioners to the notice of the Government than I had before. On every occasion on which a Budget has been considered in this chamber and in another place members of the Australian Labour Party have endeavoured to bring the needs of these people before the

Government. The pensioners have been badly treated by this Government ever since it assumed office in 1949. I sincerely hope that when the Government is considering its appropriation for the next financial year it will do something for the pensioners, and in particular for civilian widows.

In the past I have mentioned the plight of the unfortunate poor who are committed to mental institutions and who do not receive any pension whatsoever. Both you, Madam Acting Deputy President, and I have pointed out that approximately 80 per cent, of mental patients throughout Australia recover. Many people are confined to these institutions for a very short time and others for a number of years. Something should be done to accord them pension rights so that when they are discharged they will have some money with which to endeavour to rehabiliate themselves. Quite a number of these people have not close relatives and. upon discharge are more or less thrown upon the mercy of charitable organizations. I have known of some persons who have been picked up by the police because they have had no lawful means of support and who have been put away as the guests of Her Majesty for a certain time. I thank Senator Breen for reminding me of these matters. If she had not mentioned the plight of the civilian widows, I am afraid that I would have passed over it.

It is normal during the autumn sitting for the Government to seek an additional appropriation for the remainder of the financial year, and to seek supply to enable it to meet its commitments until the next Budget has been approved by the Parliament. At the same time opportunity is presented to the Opposition to raise matters which in some cases can be regarded as grievances but all of which should receive the attention of the Government. An opportunity is presented also for members of the Opposition to criticize the Government for its lack of achievements. During this sessional period there has been a dearth of worthwhile legislation. I have been a member of the Senate for almost seven years, and I think that the sitting which is expected to end next week is one of the most barren we have had in that time. I offer that as fair comment.

This sitting has been far too short. Certainly some reasons were advanced for a late start, but nevertheless, the legislation which has been introduced, except, perhaps, for the legislation which is now before us and one or two other small measures, has not been of any great consequence. 1 understand that early next week legislation will be introduced which will occupy the Senate for some time. It is characteristic of the Government to leave its important legislation until the dying hours of a sessional period. A possible exception is the Budget, which is usually introduced early in the first sessional period of the financial year. The bill we are now considering has been before the Senate for only a few hours and there has not been an adequate opportunity for Opposition members to go through it and examine it in the light of financial legislation which was passed during the Budget session.

There are many matters in relation to which one can criticize the Government. One of them is the lack of economic stability. Another is the unsatisfactory employment situation, about which 1 shall have a little more to say later. The Government’s economic policy over the past few years could be likened to a yo-yo. The Government has adopted an up-and-down, stopandgo policy. There have been recessions and then slight recoveries which have been followed by further recessions. Consequent upon the Government’s adoption of stopandgo policies a considerable number of persons have been unemployed. During the last three years at least, the unemployment situation has been very bad. Admittedly there has been some improvement over the past few months, but we must realize that there is still an army of approximately 84,000 unemployed in Australia. If my memory serves me correctly, the reduction in the number of unemployed for the month of April was approximately 160.

What concerns me as much as anything else in the number of young persons who are unable to obtain jobs. Approximately 27,000 young people who have left school recently are still out of employment. In the district in which I live a young Iiss who left school just before Christmas has been endeavouring to obtain employment ever since. It is now the middle of May. That girl has not been successful in obtaining a position, except for some seasonal work lasting three weeks or a month.

The absence of economic stability is probably due to a lack of initiative on the part of the Government in finding overseas markets. I thank the Parliament for making it possible for me to go to Nigeria recently. This was a most educational trip, which was enjoyed by every member who took part in it. We were taken on a very well-conducted tour of the country and I made it my business to ascertain whether or not it was possible to buy Australian products. To my delight, 1 found that it was possible. The prices, although a little higher, compared quite favorably with Australian prices, but the field was very limited. Australian butter, principally from Queensland, although some was from other States, sold at 6s. per lb., if I remember correctly. Preserved fruit, also from Queensland, was readily obtainable. Australian dried fruits, too, were on sale. During our visit, a world trade fair was conducted at Lagos, and I was most disappointed to find that Australia did not have a pavilion. We should have endeavoured to establish a pavilion at that fair to further the sale of our products in Nigeria. The only explanation of the absence of representation was that it would have been too expensive to have a pavilion there. If we allow such considerations of expense to enter into matters of this nature, although we desire to establish markets in countries that, no doubt, require our products, we are working on a false economic basis.

The Government is also liable to criticism for the housing situation throughout the Commonwealth. There has been no concerted effort to overcome the shortage. Although it is eighteen years since World War II. finished, we still have thousands of people waiting for homes. In Hobart, the waiting period is considerable. Housing, unemployment and social services are the matters which concern most of the people that come to my office. A few months ago it was possible to obtain a house from the State housing trust after waiting for two months. The Tasmanian Government is building houses as fast as they were built in the latter part of last year, but for some unknown reason the waiting period has extended to four months. In some instances, dependent upon the nature of the accommodation occupied by applicants, the waiting period may run to six months. I have known of people who had to wait for eighteen months. The Government should make a greater allocation to the States for housing, in order to overcome these conditions.

There is also a shortage of war service homes. Applicants are sometimes subject to a waiting period of eighteen months. This applies to houses which have been built for some time and which applicants desire to purchase. The waiting period for a loan for the erection of a new home is very short. The Government must make more money available for housing, not only to ease the problem of persons who are awaiting accommodation but also to assist to relieve unemployment. No other industry has a greater effect on employment than has the building industry, because of its many allied trades. Whenthe building industry is buoyant, so also are the allied trades, and employment is created for persons engaged in them.

The Associated Chambers of Manufactures of New South Wales conducted a survey which showed that 60 per cent. of industries were working below full capacity. The reason lies in the Government’s stopgo, up-down economic policy over the past few years. In addition, the survey disclosed that 65 per cent. of Australian factories were suffering from lack of orders.

Debate interrupted.

page 478

ADJOURNMENT

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

That the Senate do now adjourn.

Question resolved in the affirmative.

Senate adjourned at 11 p.m.

Cite as: Australia, Senate, Debates, 15 May 1963, viewed 22 October 2017, <http://historichansard.net/senate/1963/19630515_senate_24_s23/>.

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