Senate
24 October 1963

24th Parliament · 1st Session

  1. Senate
  2. 24th Parliament
  3. 1963

The PRESIDENT (Senator the lion. Sir Alister McMullin) took the chair at 11 a.m., and read prayers.

page 1383

QUESTION

TOWING SERVICES

Senator O’BYRNE:
TASMANIA

– I direct a question to the Minister representing the Minister for the Interior. Have police in the Australian Capital Territory been instructed that a roster be observed in the allocation of towing services for damaged vehicles in the Territory? Have complaints been received from some towing contractors in Canberra that the police are favouring an individual towing contractor in the allocation of towing jobs resulting from motor accidents, and that such monopoly is damaging the livelihood of smaller operators in Canberra? Has the Minister any proof of instances of favouritism which have been submitted to the department? If favouritism has been shown, has he taken action? Will the Minister see that an instruction on the observance of the towing roster issued to the police by the department is carried out by the police?

Senator WADE:
Minister for Health · VICTORIA · CP

– The implications of the question are so serious that I ask the honorable senator to put it on the noticepaper.

page 1383

QUESTION

STATEMENT BY AMBASSADOR

Senator BRANSON:
WESTERN AUSTRALIA

– Has the Minister representing the Minister for External Affairs anything further to add to a statement attributed to Mr. David Hay, Australian Ambassador to the United Nations? Mr. Hay is reported to have said -

The attitude of Communist China gives us cause for deep anxiety as they contemplate with apparent equanimity the destruction of. half the world. . . . This is deeply disturbing to us who live in (he Asian and Pacific areas.

Senator GORTON:
Minister for the Navy · VICTORIA · LP

– The statement of the Australian Ambassador to the United Nations appears to me to be so clear and1 self-explanatory that there is very little that needs to be added to it, or could be added to it, by me.

page 1383

QUESTION

SHIPBUILDING

Senator LILLICO:
TASMANIA

– I preface a question to the Minister for Customs and Excise by staling that f’ understand’ that he anil the’’

Minister for Shipping and Transport have discussed with the Government some provision for financial assistance towards the cost of building in an Australian shipyard the roll-on roll-off vessel “ King Islander “ which was constructed at Devonport for the Melbourne to King Island shipping service, conducted by R. H. Houfe Proprietary Limited. Will the Minister inform the Senate whether a decision has been reached on this matter?

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

– Discussions have taken place as stated by the honorable senator. One difficulty associated with the construction of this ship in an Australian shipyard was that the Tariff Board had laid down that a subsidy would be paid only on ships of more than 500 tons built in Australia. Because of the peculiarities of the trade to King Island a ship of more than 500 tons would not have been suitable for the King Island service. The company then had constructed in Australia one of the modern roll-on roll-off vessels which is proving successful in this trade. The initial trips have been quite successful. The vessel was built at Devonport, in Tasmania, and I understand that the company is very pleased indeed with it. The Prime Minister visited King Island in 1961 and was impressed by the great development that was occurring there. He was particularly impressed by the activities of the soldier settlers on the island. Having weighed all the difficulties and problems relevant to the question, the Government has decided that it will assist in the cost of building the vessel by means of an establishment allowance of £20,000 payable over three years. It is realized that the company provides a vital service to King Island. I am confident that the residents of the island and those who have made representations in the matter will receive this news with pleasure.

page 1383

QUESTION

BROADCASTING AND TELEVISION

Senator SCOTT:
WESTERN AUSTRALIA

– My question is addressed to the Minister representing the Postmaster-General. In view of the fact that a general election is to be held on 30th November next, can the Minister supply me with information on the following matters: Will the programme known as “ The Candidates “ be televised by Australian Broadcasting Commission stations? ls consideration being given to enabling parties to convey their policies to the electors by means of broadcasts and also by means of television? What broadcasting time was allocated by the Australian Broadcasting Commission to the Northern Territory during the last general election campaign? Which parties participated in the broadcasts? Should a political party not take advantage of the time allocated to it, may it make the time available to another party or person? Are independent candidates given broadcasting or television time to enunciate their policies during an election campaign?

Senator WADE:
CP

– I have interested myself in this matter and am in a position to inform the Senate that the Australian Broadcasting Commission has decided that the programme known as “The Candidates “ will not be presented in connexion with the forthcoming election. The commission allocates broadcasting and television time to the major political parties and it allocates time also to minor parties on the basis of the commission’s estimate of the measure of significant public support for such parties. No time additional to that to which I have referred was allocated to Northern Territory candidates during the last federal election campaign, for the simple reason that time is allotted to parties and not to individuals.

page 1384

QUESTION

ALBURY AIRPORT

Senator MCKELLAR:
NEW SOUTH WALES

– Can the Minister for Civil Aviation inform me whether the Albury airport is now functioning? If it is not, can the Minister say when it is expected to be available for use?

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

– I regret that I am unable to answer the honorable senator’s question. I shall make inquiries to-day and will let him have an answer immediately I receive the information he seeks.

page 1384

QUESTION

SUPERPHOSPHATE BOUNTY

Senator WRIGHT:
TASMANIA

– My question, which is addressed to the Minister for Customs and Excise, relates to the Budget announcement that a bounty on superphosphate is to be paid. Can the Minister say whether the bounty has yet been made available, particularly to farmers in southern Tasmania?

Senator HENTY:
LP

– The honorable senator will recall that the fact that the superphosphate bounty had not yet been made available to Tasmanian farmers was raised last week at a meeting of the Liberal Party executive. At that stage I was under the impression that the bounty was available elsewhere in Australia. I have since checked with the department and have found that my belief was correct - that as from 14th August companies in other States have been allowing for the bounty. I checked also with the company concerned in Tasmania and I was informed that, as the legislation had not yet been passed by the Parliament, the company considered that it should wait to see the details of the legislation before passing on the benefit of the bounty. The company was not aware that the bounty was being made available in the other States. When I informed the company that the payment was being made in other States, it said it would pass on the benefit directly to Tasmanian farmers as from Monday morning. I informed the company that it need not have any fear that the legislation would not be passed, as I believed that it would have the support of both sides of the Parliament.

page 1384

QUESTION

HEROIN

Senator WEDGWOOD:
VICTORIA

– I address this question to the Minister for Customs and Excise: In view of an announcement in today’s Melbourne pi ess of the seizure by customs authorities of substantial quantities of heroin, can the Minister inform the Senate whether any additional precautions can be taken to prevent the smuggling into Australia by air of heroin and other narcotic drugs?

Senator HENTY:
LP

– The Department of Customs and Excise has been very active in this field. It has made a considerable number of hauls recently on ships and at airports and even, as in the case which I read about in this morning’s press, within Australia itself. We are planning to expand our preventive staff with a view to making every effort we can to locate and seize this material at the point of entry. The fact that the department has been having such success indicates, I believe, that it would have further success if it had additional staff.

page 1384

QUESTION

AUSTRALIAN ECONOMY

Senator MARRIOTT:
TASMANIA

– Has. the Leader of -the Government in the Senate, seen the news item in to-day’s Sydney “Daily Telegraph” under the headline “Figures Disclose Strong Economy”? The item publicizes three sets of official figures which relate to building, production, and the availability of money for Commonwealth loans. Does the Minister believe that this news item indicates the success of the Commonwealth Government’s economic policy, which has been of benefit to all Australians?

Senator Sir WILLIAM SPOONER:

– I did read the article. Of course, the facts were known to me before I read it. The rate of home-building is back to the top levels of 1960 but wilh the tremendous advantage that there have not been any cost increases. That has provided a solid foundation for the home-building programme.- The recent Commonwealth loan was a success, activity on the stock exchange is vigorous, and the production of all basic commodities has reached almost record proportions. This is a state of affairs which the Government expected; its expectation has been fulfilled.

page 1385

QUESTION

AUSTRALIAN FLAGS

page 1385

QUESTION

COMMONWEALTH GRANTS

Senator SCOTT:

– My question is directed to the Minister representing the Treasurer. Has he seen a statement in this morning’s “Sydney Morning Herald” to the effect that certain grants made last year by the Commonwealth to New South Wales have not been completely used, and that the New South Wales Government has used more than half of the special unemployment relief grant to improve its current year’s Budget? Can the Minister advise me whether the Commonwealth has any way of policing these special grants to see that they are used for the purpose for which they are granted - in this instance, to relieve unemployment?

Senator PALTRIDGE:
LP

– The honorable senator will no doubt recall that at the time the Commonwealth decided to make these grants available to the States discussion occurred at the Australian Loan Council as to whether States that were in budgetary difficulties might, for the purpose of assisting their Budgets, take the amounts so granted into their Consolidated Revenue. On consideration of the request the Commonwealth agreed that where a State so wanted to employ the grant it could do so.

page 1385

QUESTION

BRITISH AIRCRAFT DISASTER

Senator LAUGHT:
SOUTH AUSTRALIA

– Has the Minister for Civil Aviation yet received information as to the cause of the disaster which befell a British jet aircraft recently undergoing trials, with tragic loss of life? Will officers of the Department of Civil Aviation at present in the United Kingdom be requested to keep the Minister supplied with information as to the cause of the disaster? Will they be required to attend any inquiry that is held?

Senator PALTRIDGE:
LP

– No information is yet available anywhere as to the probable cause of this disaster, which is sad in so many ways. The British civil aviation authorities and the Australian civil aviation authorities maintain a very close contact. The findings of the British civil aviation authorities - progressive findings, if possible - will be followed very closely and with great interest by our authorities. I am not sure, but I think the honorable senator askedwhether I would make some statement as information became available. I will consider that request at the appropriate time because I realize the very keen interest of many Australians in the future of the British aircraft industry and, particularly, in the performance of this plane.

page 1386

QUESTION

AUSTRALIAN NATIONAL UNIVERSITY APPOINTMENTS

Senator MARRIOTT:

– My question is addressed to the Minister representing the Postmaster-General. I refer to a broadcast by the Australian Broadcasting Commission on Wednesday, 9th October, 1963, when Mr. Alan Manning was interviewing the vice-chancellor of the Australian National University. Mr. Manning asked, “ Suppose an eminent scholar who was considered in some way a security risk, was eminently suited for an appointment, would he get it? “ The vice-chancellor, I am reliably informed, said: “ Yes, if he were an eminent scholar, as you say, 1 think he would be appointed on his academic record. Of course, if he had a criminal record with it we would necessarily think twice.” The point I am making is that the vicechancellor gave the impression that a man who was a security risk would be acceptable to the university authorities but that they would think twice about a man with a criminal record. What is the Government’s view of this attitude?

Senator Sir WILLIAM SPOONER:

– I think thatthe Government would take the view that the entry of people into Australia is controlled by the immigration laws. If an applicant for a university position lived overseas he would have to satisfy the immigration laws before he could secure the appointment. If the applicant were resident in AustraliaI should think’ that the university, as an autonomous body, would have to accept the responsibility for the appointment.

page 1386

QUESTION

RADIO AND TELEVISION POLI TICAL BROADCASTS

(Question No. 89.)

Senator COLE:
TASMANIA

asked the Minister representing the Postmaster-General, upon notice -

Since the federal elections held in December, 1961, what members of the Commonwealth Parliament from (a) the Australian Democratic Labour Party, (b) the Australian Labour Party, (c) The Australian Country Party, and (d) the Liberal Party of Australia have been given the opportunity by the Australian Broadcasting Commission to discuss or to comment on political, social or other matters in radio or television sessions conducted by the commission, apart from ordinary Parliamentary broadcast’s?

Senator WADE:
CP

– The PostmasterGeneral has furnished the following reply: -

  1. Australian Democratic Labour Party -

Radio- Nil.

Television - Senator J. P. McManus.

  1. Australian Labour Party -

Radio- Mr. K. E. Beazley, Dr. J. F. Cairns, Hon. A. A. Calwell, Mr. L. C.Hayden, Hon. W. J. Riordan, Senator D. N. Tangney, Mr. E. G. Whitlam, Hon. E. J. Ward.

Television- Mr. L. H. Barnard, Dr. J. F. Cairns, Hon. A. A. Calwell, Mr. E. G. Whitlam, Hon. E. J. Ward.

  1. and (d) Liberal-Country Party Coalition -

Radio - Hon. Sir Garfield Barwick, Senator Nancy Buttfield, Hon. C. W. Davidson, Hon. A.R. Downer, Dr. A. J. Forbes, Senator the Hon. J. G. Gorton, Senator the Hon. N. D. Henty, Hon. P. M. Hasluck, Rt. Hon. Sir Robert Menzies, Rt. Hon. J. McEwen, Hon. H. F. Opperman, Hon. R. W. Swartz, Senator V. S. Vincent, SenatorI. A. Wood.

Television - Hon. Sir Garfield Barwick, Hon. L. H. Bury, Mr. R. Dean, Hon. C. W. Davidson, Senator the Hon. Denham Henty, Rt. Hon. H. E. Holt, Rt. Hon. Sir Robert Menzies, Hon. W. McMahon, Hon. A. G. Townley, Senator V. S. Vincent, Senator the Hon. Sir William Spooner, Hon. A. R. Downer.

page 1386

QUESTION

TELEVISION

(Question No. 110.)

Senator COHEN:
VICTORIA

asked the Minister representing the Postmaster-General, upon notice -

  1. When commercial television licences were first granted in 1955 in the Sydney and Melbourne areas -

    1. Did Amalgamated Television Services Proprietary Limited- to whom the

Channel 7 licence in Sydney was granted propose that 67 per cent. of the programme material would be live production and therefore Australian?

  1. Did Consolidated Press Limited to whom the Channel 9 licence in Sydney was granted propose that50 per cent. of the programme material would be live production and therefore Australian?
  2. Did G.T.V. Corporation Proprietary Limited to whom the Channel 9 licence in Melbourne was granted propose that Australian content would be 54 per cent. in the first year, 55.8 per cent. in the second year and 62.8 per cent. in the third year?

  3. Did the Herald and Weekly Times Limited to whom the Channel 7 licence in Melbourne was granted propose that approximately 78 per cent. of programme material would be live production and therefore Australian?

    1. Do the statistics published by the Australian Broadcasting Control Board in its latest annual report show that each of the above television operators mentioned has failed to live up to its proposals?
    2. Is it a fact that Austarama Television Proprietary Limited, Channel 0 in Melbourne, undertook to have 58 per cent. Australian content in its programmes in the first year of operation?
    3. Did the Postmaster-General recently state that new stations such as Channel 0 would be exempt from the new 45 per cent. provision in relation to Australian content of programmes for three years and would be allowed five years to reach 50 per cent?
    4. If so, will the Postmaster-General explain why he has now applied the requirement of 45 per cent. Australian content not only to the new Austarama channel but also to the other operators who have had seven years to make good their original proposals?
Senator WADE:

– The PostmasterGeneral has supplied the following answers: -

  1. The programme proposals of the successful applicants for commercial television licences in Sydney and Melbourne, in 1955, included the following: -

    1. Amalgamated Television Services Proprietary Limited, licensee of ATN Sydney, proposed operating for 25 hours weekly in the first year, 28 hours weekly in the second year and 35 hours weekly in the third year, with an estimated live programme content of 67 per cent,. or 16-2/3 hours weekly Australian material in the first year, 18-2/3 hours weekly in the second year and 23-1/3 hours weekly in the third year.
    2. Consolidated Press Limited, on behalf of Television Corporation Limited, the company formed to operate as licensee of TCN Sydney, proposed operating for 35 hours weekly in the first year, 40-42 hours weekly in the second year and 55 hours weekly in the third year with an estimated live programme content of 50 per cent., or 17½ hours weekly Australian material in the first year, 21 hours weekly in the second year and 27½ hours weekly in the third year.
    3. General Television Corporation Proprietary Limited, licensee of GTV Melbourne, proposed operating for 8½ hours weekly in the first year, 14½ hours weekly in the second year and 27½ hours weekly in the third year, with an estimated live programme content of 54 per cent. in the first year, 55.8 per cent. in the second year and 62.8 per cent. in the third year; that is, 4½ hours of Australian material in the first year, 8 hours in the second year and 17½ hours in the third year.
    4. Herald and Weekly Times Limited, licensee of HSV Melbourne, proposed operating for 35 hours weekly in the first year, 40 hours weekly in the second year and 50 hours weekly in the third year, with an estimated live programme content of 72 per cent. or 25¼ hours of Australian material in the first year, 283/4 hours weekly in the second year and 36 hours weekly in the third year.
  2. Statistics published in the fifteenth annual report of the Australian Broadcasting Control Board show that in June 1963, ATN Sydney telecast 33 hours weekly of Australian material, TCN Sydney 374 hours weekly, GTV Melbourne 36 hours weekly, and HSV Melbourne 31¼ hours weekly of Australian material. The actual amount of Australian material televised exceeds the amounts proposed in 1955 by the licensees of ATN, TCN and GTV; in the case of HSV the amount televised is slightly less than the amount proposed in the application, but the proportion still exceeds the present requirement of 40 per cent.
  3. Yes.
  4. The statement to which the honorable senator refers was intended to apply only to country and provincial stations which, after three years’ operation, will be required to televise the proportion of Australian programmes then currently required of . metropolitan stations.
  5. The requirement of 45 per cent. of Australian programmes as from January 1964, has as yet been applied only to the ten metropolitan commercial stations now in operation. In 1960 when the minimum requirement of 40 per cent. was specified, it was stated that the figure of 40 per cent. could not be regarded as satisfactory in the long term. After examination of the circumstances it is considered that the present time is opportune to make the first increase from 40 per cent.

page 1387

QUESTION

ABORIGINES

(Question No. 129.)

Senator CAVANAGH:
SOUTH AUSTRALIA

asked the Minister representing the Prime Minister, upon notice -

  1. Over the past twelve months, how many petitions have been received by both Houses of the Commonwealth Parliament seeking an alteration to section 127 of the Constitution to remove any determination against aboriginal citizens?
  2. What was the total number of petitioners?
  3. If a significant number of electors has sought an alteration of this section of the Constitution, will the Government give consideration to the holding of a referendum to permit the electors to express by vote whether an alteration to the section is desired?
Senator Sir WILLIAM SPOONER:

– The Prime Minister has provided the following answers to the honorable senator’s questions: - 1 and 2. During the first session of the 24th Parliament which commenced on 20.h February, 1962, and up to the 26th September, 1963, two petitions containing 89 signatures were presented to the Senate and forty-three petitions containing approximately 43,900 signatures were presented to the House of Representatives.

  1. The Government has made it abundantly clear that it opposes discrimination against the aboriginal citizens of Australia. However, any proposal to alter section 127 of the Constitution needs very careful consideration if only to establish the feasibility of enumerating that portion of the population which normally lives under nomadic conditions some distance from settled areas.

page 1388

QUESTION

STANDARDIZATION OF RAIL GAUGES

(Question No. 125.)

Senator BISHOP:
through Senator Cavanagh

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

  1. Has. the Minister seen a report in the Adelaide “ Advertiser “ of Friday, 20th September, 1963, that the conversion of the Port Pirie to Broken Hill line to standard gauge may now be completed earlier than scheduled?
  2. Is it a fact, as reported, that the Commonweal h Government, at a conference in Canberra, accepted that the Kalgoorlie to Kwinana standardization should be completed in 1967 instead of 1968 and that Commonwealth officials believe that the time-table for the South Australian work may now be advanced?
  3. Will the Minister make a statement on this matter?
Senator PALTRIDGE:
LP

– The Minister for Shipping and Transport has furnished the following replies: -

  1. Yes.
  2. At a conference in Canberra between the Western Australian Minister for Railways, Mr. Court, the Treasurer (Mr. Harold Holt), and myself, it was indicated that the Commonwealth would be prepared to give consideration to pro posals for an earlier completion of the Kalgoorlie to Kwinana standard guage project if this was physically possible. It has always been recognized by the Commonwealth Government that it was desirable for both the Broken Hill to Port Pirie and Kalgoorlie to Kwinana projects to be completed about the same time and this is still the desire of the Government.
  3. At this stage and until the constructional and technical problems have been given a good deal of further consideration the Minister has no statement to make.

page 1388

QUESTION

SOCIAL SERVICES

(Question No. 135.)

Senator WRIGHT:

asked the Minister representing the Minister for Social Services, upon notice -

  1. Has the Minister’s attention been directed to the statements in the 1962-63 annual report of the Director of Social Services that (a) of the pensions granted during the year 30 per cent. of Class A and 7 per cent. of ClassB were granted to deserted wives; (b) of analysis of the Victorian figures, the average number of children under sixteen years of age per family was higher for deserted wives than for widows?
  2. What amounts of the widows pension payments were paid to or for deserted wives in the years ending 30th June, 1960, 1961, 1962 and 1963?
  3. Has any consideration been given to legislation for making more effective enforcement of maintenance orders against defaulting husbands?
Senator Sir WILLIAM SPOONER:

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

  1. Yes.
  2. Separate figures for expenditure are not available but based on the average rates of pension payable to widows as a whole, the information requested by the honorable senator would be as follows: -
  1. This is a matter for the States and the Territories. As to the present position please see the answer to part (3) of Question No. 149 to which the Attorney-General has furnished a reply.

page 1388

QUESTION

ALBURY AIRPORT

Senator PALTRIDGE:
LP

– by leave- I wish to answer a question that was asked earlier by Senator McKellar. The honorable senator asked me what the position was concerning the commissioning of the Albury airport. On 27th September, the Albury Council advised me that it hoped to open the aerodrome some time in December. I have had no further indication from that authority yet. I expect the council will write to me as soon as a date for the opening of the airport has been fixed.

page 1389

QUESTION

AUSTRALIAN NATIONAL AIRLINES

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

– In accordance with section 40 of the Australian National Airlines Act 1945-1961, I present the following paper: -

Eighteenth Annual Report of the Australian National Airlines Commission, trading as TransAustralia Airlines, for the year ended 30th June, 1963.

I ask for leave to make a statement in connexion with the report.

Leave granted.

Senator PALTRIDGE:

- Mr. President, I know the Senate would wish me to point out that T.A.A. made a record operating profit before tax of £891,594. After providing £356,637” for tax T.A.A.’s net profit was £534,957 compared with £463,333 for the previous year. This has enabled the commission to recommend to the Government payment of a dividend of 7 per cent, on T.A.A.’s capital of £7,500,000. The commission and the staff of T.A.A. take justifiable pride. in the fact that this is 1 per cent, higher than the profit target set for the airline by me in consultation with the Treasurer and the commission at the start of the financial year. Also I should point out that Trans-Australia Airlines carried more than 1,200,000 paying passengers during the year - a new Australian record.

I think, Mr. President, from these few facts it will be evident to the Senate that T.A.A. has again achieved an excellent result - which is justifiably a matter of pride for the commission and the staff of T.A.A. and a matter of considerable satisfaction to the Australian general public.

page 1389

GOVERNMENT BUSINESS

Precedence

Motion (by Senator Sir William Spooner) agreed to - “ That Government business take precedence of general, business after 8 p.m. this . sitting^’ ‘

page 1389

SPECIAL ADJOURNMENT

Motion (by Senator Sir William Spooner) agreed, to -

That the’ Senate, at its rising, adjourn till Monday, 28th October, at 3 p.m.

page 1389

PROPOSED EXPENDITURE 1963-64

In committee: Consideration resumed from 23rd October (vide page 1379).

Proposed expenditures. - Department of Labour and National Service, £3,043,000; Department of Labour and National Service - Capital Works and Services, £88,000; Post Discharge Resettlement Training, £1,000;. Technical Training, £50,000. Department of Defence, £2,007,000; Recruiting Campaign, £699,700; Department of the Army, £78,317,000; Department of Air, £80,518,000; Department of Supply, £30,539,000; Commonwealth Railways, £5,582,000; Commonwealth Railways - Capital Works and ‘ Services, £2,725,000; Postmaster - General’s Department, . £113,821,000; Postmaster-General’s - Department - Capital Works and Services, £68,775,000; Broadcasting and Television Services, £15,703,000; Broadcasting and Television Services - Capital Works and Services, £3,504,000; Overseas Telecommunications Commission - Capital Works and Services, £1,722,000- noted.

Resolution reported; report adopted.

page 1389

LOAN BILL 1963

Second Reading

Debate resumed from 23rd October (vide page 1380), on motion by Senator Paltridge -

That the bill be .now read ..a second time.

Senator McKENNA:
Leader of the Opposition · Tasmania

– The purpose of this bill is to authorize the raising of £62,500,000 for purposes of defence expenditure in the .current year. Clause 3 sets out the broad purpose of the bill. It provides that the Treasurer (Mr. Harold Holt) may borrow this amount in either of two ways. It may be borrowed pursuant to the Commonwealth Inscribed Stock Act, or it may be borrowed under the provisions of any act authorizing the issue of treasurybills. Clause 4 provides that the moneys raised shall be applied for two purposes only. The first purpose is to. pay the costs of- borrowing, and .the second, to meet the- expenditure specified in Part I of the second schedule to the Appropriation Bill 1963-64. Clause 5 is a safeguarding provision. It provides that the total amount to be expended under the Appropriation Act and this bill is not to exceed the total amount referred to in the schedule I have just mentioned. Clause 5 contains a further protective provision. It provides that the limitation upon the amount that may be expended on defence shall not prevent the Treasurer from using the Treasurer’s Advance for purposes of defence if the need arises. We are not opposing the bill, but I am provoked into making a number of comments.

The Minister for Civil Aviation (Senator Paltridge) stated in his second-reading speech -

Very tentatively, the Treasurer suggested that loan raisings might total £300,000,000 in 1963-64, which would leave a gap of £58,400,000 to be financed from temporary borrowings.

One can understand why the suggestion should have been so tentative and why the Treasurer and the Minister for Civil Aviation, who represents him in this chamber, should be so nervous about forecasting the ultimate Budget result. In respect of the financial year that concluded on 30th June last, an enormous error in estimating by the Treasurer and the Government was disclosed. The Senate will recall that the Treasurer had budgeted for a deficit of £118,000,000 and that at the end of the year there was a surplus of £16,000,000. In other words, there was an error of £134,000,000 in his calculations. We say that that showed the greatest incompetence. This year, he is covering his flank, as it were, by saying how very tentative is the estimate that he puts before the Parliament in relation to the annual accounts for the year.

How very confusing it is to anybody who wants to undertake research into expenditure on defence to find that he may have to go to two parts of the Appropriation Bill, which is yet to come before us. He must look first of all under the defence estimates and then under the Treasurer’s Advance. He must have recourse also to the Loan Fund. Anybody who wishes to work out the total amount expended on defence by this Government down the years must engage’ in a regular paper, chase, lt is confusing and difficult to obtain the information. There have been times when works and services - capital items - have been included in the Appropriation Bill for the ordinary annual services of the Commonwealth. On other occasions they have been dealt with in the bill to appropriate moneys for capital works and services. The procedure tends to create confusion and difficulty for those who are interested in following the course of defence expenditure through the public documents of the Commonwealth.

I have already indicated that the bill authorizes the raising of the money either under the Commonwealth Inscribed Stock Act or by means of treasury-bills. I invite the Minister to tell us whether it is contemplated that the moneys should be raised under the Commonwealth Inscribed Stock Act. My belief is that that is not in contemplation at all. I point out that the Government has alernative courses open to it. I should say that the sole intention of the Government is to have further recourse to treasury-bills. Has any decision been made on that matter? Is the Minister in a position to tell me what will be done?

While he is on that topic, 1 should like him to indicate why this procedure, which in effect is a raising of moneys to cover a deficit, is right when the Government adopts it and why it is declared to be inflationary, irresponsible and wrong when the Opposition proposes it, as it has from time to time, to provide a further stimulus to the economy. What the Government clearly is doing in this case is seeking to provide some stimulus to an economy which at least is sluggish - a condition that has been brought about by the Government’s own misguided policy. We are not arguing that the economy does not need some such injection, but we are pointing out quite calmly and objectively that it cannot be right for the Government to have recourse to treasury-bill finance and wrong for the Opposition to suggest that it would do the same. So I pose these two questions to the Minister: Will recourse be had to treasury-bill finance? Why is it right for the Government to do that and wrong for the Opposition to propose it?

My third comment relates to an accounting procedure,-! lt is quite wrong to present to us in the documents that are attached to the Budget speech a statement which shows the total revenue and1 the total expenditure of the Consolidated Revenue Fund in the form indicated. If the Senate cares to refer to Statement No. 3 attached to the Budget speech, it will note that for the current year the Government has indicated that it proposes to spend £251,671,000 on defence. Then appears the line “ Less Amount Charged to Loan Fund “, and an amount of £62,500,000 is shown. The estimated1 expenditure thereby is reduced to £189,171,000. That sum of £189,171,000 is the only sum related to defence expenditure which is included in the sum of £1,837,221,000 shown at the foot of the column as total expenditure.

I suggest that to incorporate by way of deduction a proposed borrowing of £62,500,000 distorts the total expenditure and also what ought to be the total receipts of the Consolidated Revenue Fund. In my view, it ought to have been done in this way: Amongst the receipts should have been clearly shown, as a matter of honesty and frankness, a deficit of £62,500,000 which it is proposed, to finance by borrowings. If loan moneys are raised and are used for the purposes of the Consolidated Revenue Fund, that fund should show the total moneys that are received. This is purely an accounting matter, but the .procedure that has been adopted understates the receipts of the Consolidated Revenue Fund and the total expenditure of the Commonwealth. I hope I am making my point clear to the Minister.

Senator Paltridge:

– I follow you, but I contest the point.

Senator McKENNA:

– If I am not making myself clear, I would like the Minister to raise the issue with me. It is very difficult, when listening to words, to see figures.

Senator Paltridge:

– From what statement is the honorable senator quoting?

Senator McKENNA:

– I am looking at Statement No. 3 which is attached to the Budget speech for 1963-64. The Minister will note that the incorporation of this sum of £62,500,000 in the Consolidated Revenue Fund is shown as a deduction from expenditure on defence services. That method of presentation distorts the total amount of expenditure as shown in the state ment and also the total receipts of the Consolidated Revenue Fund under the heading “ Revenue “. I claim that the receipt of £62,500,000 should be shown under the item “ Revenue “. It should be shown honestly and frankly for what it is - a contribution for the Loan Fund to the Consolidated Revenue Fund to cover a general deficit. The position could be explained by an accompanying note to the effect that the deflicit is to be covered by money raised by means of a loan.and passed over to the Consolidated Revenue Fund.

To show the position in the way in which it is shown is confusing and misleading and distorts the picture which should be presented in the Consolidated Revenue Fund. The same end result is achieved, but the Government has presented the situation in a tortuous, misleading way. Let it- show the deficit and call it a deficit. If the Government proposes to contribute to the Consolidated Revenue Fund from the Loan Fund, let it indicate its intention frankly and openly. Not only does the procedure which has been followed distort the total receipts and revenue; it is a device which has been used to hide from the uninitiated the fact that there is a deficit. One looks at the page and notes that the position is perfectly balanced. Where is there one word in the document to indicate that there is a deficit? Plainly, the Treasurer is budgeting for a deficit of £62,500,000. This statement disguises, and is deliberately intended to disguise, to all but the initiated the fact that there is a Budget deficit. To do that is wrong.

It is interesting to note that this borrowing is to be appropriated in reduction of one item of expenditure - defence services. The gross total for that item is £251,671,000. Why does the Government take one item of expenditure and- deduct from it. a sum of £62,500,000 because it intends to finance that much out of the Loan Fund and not out of Consolidated Revenue? The reason is quite clear. It does. so because clause 3 of the Financial Agreement provides that the Commonwealth shall not be obliged in any way to submit borrowings for defence purposes to the Australian Loan Council. Any amount that is borrowed for defence purposes, and the terms and conditions upon which the money is raised, do not come within the purview of the Loan Council. Clearly, .the Commonwealth wants to run free of any control by the States in relation to the borrowing we are now considering. The Commonwealth has power to make temporary borrowings under the terms of the Financial Agreement.

Senator Scott:

– The arrangement is necessary for defence borrowing, is it not?

Senator McKENNA:

– I am not really questioning the power of. the Commonwealth Government to borrow for defence purposes in an emergency without submitting its proposals to the Loan Council. But the truth is that, when one looks at the Consolidated Revenue Fund statement for the current year, one sees that the Commonwealth really is not raising this money for defence purposes. In truth, it is just filling the gap between receipts and expenditure. If there were a clear appropriation for defence purposes the Minister would be able to particularize to the Senate the items included in the sum of £62,500,000. To what particular items in the defence estimates has that amount been allocated? I challenge the Minister to tell thc Senate. I say right now that he would not even begin to attempt to answer that question.

Senator Paltridge:

– Neither would you.

Senator McKENNA:

– I know I would not. Neither would I expect anyone in this Senate to do so, because it is impossible to allocate this sum to particular defence items. As I said a while ago, this procedure is only a pretence to cover up thc fact that there is a general deficit. I do not like it, and I am being fairly trenchant about it. I repeat that it is merely a ruse to cover a general deficit. The fact that there is a deficit is concealed by the way that this has been done by the Government. It is, of course, impossible for the Minister, or anybody else, to tell thc Senate for what particular defence items this sum of £62,500,000 is to be appropriated.

This is a two-fold thing. It is a device to get away from the Australian Loan Council procedure in relation to borrowings for general budgetary purposes, and it also aids the Government to conceal, in thc document it presents to the Parliament, the fact that there is a deficit in the Consolidated Revenue Fund for the year. As the Treasurer himself says, very tentatively, it is in the nature of a deficit. He is very nervous after the awful mistake he made in his estimating last year - to the tunc of £134,000,000.

It is certainly a long time since I had the experience of estimating deficits or surpluses for budgetary purposes but the advisers of the Government in my time in office were never that far out. They amazed me with the accuracy of their estimates of receipts and expenditure and of the loan market yield. I have not verified this as a mathematical proposition, but I doubt whether in the whole history of the Commonwealth there has ever been such an enormous error made by a Treasurer as was made last year.

Then there is another difficulty. The Appropriation Bill for the ordinary annual services of the Commonwealth includes provision for the defence services. If there were capital items included in the defence provision in the Appropriation Bill the Senate could not amend the provision for (hem because the Senate cannot amend the Appropriation Bill; but if those capital items were taken out of the Appropriation Bill for the ordinary annual services and shown in the Appropriation (Works and Services) Bill, a different position arises. In the first case, the Senate cannot amend the bill. In the second case, according to the decision of the Senate itself on 4;h November, 1952, the Senate can amend the bill. We have created a particularly illogical position whereby a capital expenditure that is put into the Appropriation Bill for ordinary annual services is unamendable but if, instead, it goes into the Appropriation (Works and Services) Bill, by the decision of thc Senate, the Senate can amend that bill, and therefore that expenditure provision.

I am not contesting the decision to-day. I did contest it on a famous occasion on 4th November, 1952. First, 1 dissented from a decision of the President. 1 withdrew my dissent after receiving an undertaking from the government of thc day that I should be given an opportunity to argue the matter in abstract and by itself. We had a most interesting and objective debate, on the question whether the Senate could or could not amend the bill dealing with capital works and services. 1 am interested to note a question that Senator

Wright has on the notice-paper in relation to this matter, to which he adverted on the adjournment debate last evening. J do not want to anticipate any argument that he may put to the Government, but having regard to my theme I invite any honorable senator who would like to follow up what happened on 4th November. 1952, to refer to Mr. Odgers’ book al pages 153 to 155. Mr. Odgers devotes some two and a half pages to this matter.

I recall with relish that on that occasion the Labour Party let its members in this chamber participate in a free vole. The Labour Party and the Government parties were split on the issue. We had persons wilh legal qualifications on both sides of the chamber, and there was a photo finish of 24-all, which, under the Constitution, resolved the question against the proposition. Ultimately Senator Spicer and I were at common cause in the form of the resolution wc put. Wc were in accord, but owing to the provision that if the Senate is equally divided the motion is not carried our argument that the Senate could not amend the Appropriation (Works and Services) Bill fell to the ground. Quite frankly ] think it is a matter of form rather than of substance whether we can or cannoi amend a bill, because, in relation to any bill whatsoever - whether a money bill or not - the Senate has the power of outright rejection. Even in the case of bills that the Senate cannot amend it can make requests for amendments, and can keep on repeating those requests. Therefore, the question is not so much a matter of substance although it is one of great constitutional and academic interest in the abstract. That question is more or less raised and is implicit in what we are now discussing.

After making those comments - 1 confess that the subject interests me very much - i indicate that I do not propose to open the subject up any further to-day. I indicate also that the Labour Party does not oppose the measure. The Labour Party thinks that in the existing state of the economy it is essential that the Government spend additional moneys to stimulate the economy to try to give some encouragement to an economy still sluggish and still not recovered from the blows that were administered lo it by the stringent economic measures of November, 1960. With those comments that can be regarded either as being in derogation of the bill or otherwise, as any honorable senator chooses, I again indicate that the Opposition supports the bill.

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

[I2.14 - in reply - Naturally I am pleased that the Opposition does not oppose the bill. Indeed, 1 should have been remarkably surprised had it done so. Nonetheless the Leader of the Opposition (Senator McKenna) did make some comments to which I desire to refer in closing the. debate. The Leader of the Opposition referred, as he has done on other occasions, to the discrepancy between the estimate of loan raisings for the last financial year and the achieved figure, and again indulged in some criticism of the Treasurer (Mr. Harold Holt) because of the discrepancy in the two figures. One must remember that estimating the possibilities of loan markets to-day is an extremely hazardous occupation. This is particularly so for a government of our political colour, which makes a habit of obtaining loan money from overseas. Of course, the overseas market is much more difficult to assess than is the local market. The Leader of the Opposition will recall that the big difference in the estimated figure and the achieved figure in respect of loans last year arose because of the outstanding success of the Government in raising loans overseas. I suggest to ‘ the honorable senator that prudent officers of a prudent government would be extremely unwise to write into their estimates at the beginning of the year anything thai could be fairly regarded at that time as other than a realistic figure.

Changes occur very suddenly in’ loan markets. The capital market is probably the most sensitive of all. Australia , was favoured in the overseas market last year because certain areas of the world, because of disturbances which were either local or external, were made less attractive as investment propositions than they had been. For that reason Australia succeeded in raising loans.

In the world in which we live to-day, it is not at all surprising that the overseas loan market docs show fluctuations. I remind the Leader of the Opposition that these fluctuations could occur again. As he was. speaking I allowed myself the luxury of contemplating what might be the reaction of a Labour government in the unlikely circumstance of one being elected in November. If, next year, such a government found itself in a position to obtain loans overseas, what action would it take?

Senator Kendall:

– We know what it would do.

Senator PALTRIDGE:

– I should like the Leader of the Opposition to tell me. Looking back a long way, the Leader of the Opposition said, “In our day we got very close in estimating what the local market would yield “. May I remind the honorable senator that in those days the task was much easier. At that time the market was controlled by government ukase to a point where all forms of investment were inhibited. All that the government of the day had to do was to assess the total figure available from the market and to say, under its capital issues control, that it would permit so much from that figure for private investment and would take the remainder. I remind the honorable senator that the situation is entirely different now from what it was then. In his day it was a much less hazardous task to assess what a loan market would yield.

The honorable senator asked whether the money would be raised under the Commonwealth Inscribed Stock Act. I have been told that this has occurred on some occasions in the past. However, my memory of recent years is that the money had been raised by way of treasury-bills. As to what will happen this year, all I can say is that it will depend on the availability of funds from all sources. The Government will, from time to time, have regard to the various market conditions before deciding through what channel or in what form the money will be raised.

The Leader of the Opposition then said that we proposed to bridge the gap between total receipts and total expenditure with treasury-bills and that we had condemned this practice as inflationary when Labour had advocated it. I hope the honorable senator has not been labouring under any misapprehension of the Government’s policy over the years. We have said - I think in a very realistic way - that there will be times when it will be necessary to embark’ on some measure of treasury-bill finance. The difference between the Labour Party’s announced policies and our policy, particularly as reflected in various policy speeches over the years, has been the extent of the inflationary finance that a Labour government would use. Any honorable senator sitting in this chamber will remember Labour’s series of golden, costly promises.

Senator Wedgwood:

– Recurring expenditure!

Senator PALTRIDGE:

– Recurring expenditure, as my colleague reminds me. Those promises have been made by the Labour Party in successive policy speeches over the years. It is quite wrong and quite misleading to try to liken the responsible policy pursued consistently by this Government to the financial policy announced from time to time by the Labour Party. Surely, if any one wants to check the efficacy of our economic and financial policies in recent times, all he has to do is look about the economy and accept not the judgment of a possibly biassed political personality, but the individual objective judgment of those who are in a position to make it.

In recent times questions have been asked in this chamber, arising from reports that have come from overseas, about the condition of this economy as compared with other economies. Possibly the most satisfying point in all these observations has been that although we have experienced progress, development and expansion, and although there is now increasing activity over the whole economic spectrum, we have achieved over, the past two-and-a-half years, and we will continue to achieve/; a degree of stability which, I sugest, is looked at with envy by every country in the Western world. With great respect, I say to the Leader of the Opposition that it is completely wrong even to attempt to say that our policies are anything like the Opposition’s policies merely because we have used, as a matter of deliberate policy in some circumstances, a measure of treasury-bill finance.

The honorable senator then referred to the presentation of accounts. He pursued an argument in which he said that this presentation lacked honesty and frankness. He referred particularly to Statement No. 3, Consolidated Revenue Fund Estimates, 1963-64, issued with the Budget speech, and indicated- that the defence expenditure under that heading had., been .presented in a misleading form. I put it to the honorable senator that the defence expenditure for this year is set out quite plainly at item No. II of that statement which shows a to al expenditure of £25 1 ,671 ,000. In order not to mislead any one, immediately under that figure is a note reading “ Less Amount Charged to Loan Fund, £62,500,000”, showing quite clearly that the total estimated expenditure is about £200,000,000. Lest there be. any confusion, the statement makes it abundantly clear that the estimated expenditure will not all come from Consolidated Revenue and that we are resorting to loan funds to obtain part of the money. it is misleading, in considering the Budget, to take any one tabic in isolation and try to delude any one into believing that this can or docs tell the complete story. One table cannot do that, despite the best endeavours of the members of the Public Accounts Committee who have devoted weeks of attention to devising a presentation of accounts which is to-day vastly improved. The most devoted member of the Public Accounts Committee would not argue that any one table or, for that matter, any one publication, by itself, can contain the full Story. Related to this item lo which the Leader of the Opposition has referred in Statement No. 3, Consolidated Revenue Fund Estimates, 1963-64, are pages of notes explaining the proposed expenditure in detail. Further, to suggest that any budget document should bc studied without reference to the Budget speech is misleading. The Treasurer (Mr. Harold Holt) was at pains to indicate in his Budget speech that there would be a considerable gap between the total receipts and total expenditure and that resort would be had to loan funds to cover that gap. The statement that these documents, (he presentation of which has been closely examined by the Public Accounts Committee, lack honesty or frankness is just not true. It makes good political claptrap, but is not true.

The Leader of the Opposition alleged that there would be a deficit of £62.500,000 in connexion wilh a defence expenditure amounting to £251,671,000.” He asked why wc treated the loan raising of £62,500.000 as being applicable not to the work’ of go vernment departments generally but to defence only. 1 suggest, with great respect, that the answer lies in the fact that the Commonwealth, under the Constitution, is obliged to accept responsibility for the provision both of physical defence and “finance for defence. It is the most natural thing in the world, therefore, that the amount of loan raisings in question should be applied to this purpose, lt is not correct to suggest, as the Leader of the Opposition suggested, that this is an attempt to evade or avoid the Australian Loan Council. This practice has been followed for a period of years. It was followed, incidentally, during’ the period in which the Leader of the Opposition was himself in office during the war and for some years after the war. lt was followed then for the same good reasons as we arc following it to-day. No doubt we will continue to follow that practice.

I want to rebut completely any suggestion that this has been done behind the backs of the Premiers or of the Loan Council. It has not been done, to use the words of the Leader of the Opposition, to evade the Loan Council. I am sure that the Leader of the Opposition will know that I do not speak in a patronizing way when I say that I am always very interested to hear him speak on these matters because my own researches have indicated the close interest which he himself took in them when he was a Minister. 1 know the large part that he played in preparing and finalizing a number of finanical measures. Notwithstanding that fact, positions change and at this point of time the honorable senator seeks to make comment with which I cannot agree.

Question resolved in the affirmative.

Bill read a second time.

F» committee:

The bill.

Senator McKENNA:
Leader of the Opposition · Tasmania

– I wish to direct attention to what is really a minor matter in respect of which I have curiosity. In clause 5 of the bill there is a reference to a “ purpose or service “. The expression appears in two places, in the third line and in the last line of sub-clause I. 1 notice that the long title of the Appropriation Act makes reference only to “ service “. lt reads -

A bill fur an act to authorize the issue and application from out of the Consolidated -Revenue

Fund, of a sum for the service of the year ending on the thirtieth day of June. . . .

I imagine that the clause would have sufficed if the word “ service “ only were used, but the terminology is “ purpose or service “. I presume that this did not occur haphazardly and that there is a reason for the departure from the expression used in the Appropriation Act. Would the Minister care to comment on that?

Senator Wedgwood:

– Section 4 of the Appropriation Act contains the expression, “ for the purposes and services “.

Senator McKENNA:

– Yes, I see that now. I was reading from the title. I should be interested to hear what the Minister has to say on the subject.

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

– I am not aware of the reason which the honorable senator seeks and unfortunately I have not advice available to me. I ask him to be so good as to leave the matter on the basis that I shall find out and let him know.

Senator McKenna:

– Yes. It is just mild curiosity.

Bill agreed to.

Bill reported without amendment; report adopted.

Third Reading

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

Sitting suspended from 12.38 to 2.15 p.m.

page 1396

CURRENCY BILL 1963

Bill received from the House of Representatives.

Standing Orders suspended.

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

Second Reading

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

– I move -

That the bill bc now read, a second time.

This bill is the first of a number of enactments which will be necessary to give effect to the Government’s decision to introduce a system of decimal currency into i -Australia in .February, 1966. The. main < purposes of the bill are to establish the name of the new decimal currency unit, to settle the denominations and composition of the new decimal coins, and to give statutory effect to the Decimal Currency Board which was provisionally appointed last June, and which will be charged with supervising a number of the main aspects of the change-over arrangements.

At the time of the change-over, the new bill will replace the ‘ present Coinage Act 1909-1947 and, after a transitional stage has been passed and the decimal currency system is fully operating in Australia, it will determine the nature of the Australian coinage system and such matters as legal tender and the fulfilment of contracts and agreements entered into before the changeover date. The bill does not purport to establish legal tender and other arrangements which will apply during the transitional period following the change-over date, when both the old and new systems of currency will be in circulation simultaneously for a period of perhaps eighteen months or two years. These transitional arrangements will be the subject of another bill which will be introduced at a later stage, after a number of matters have been studied and made the subject of recommendations by the Decimal Currency Board.

While this bill contains a blanket provision providing for the conversion into new currency of all references to existing currency in Commonwealth legislation, and in bills of exchange, contracts, agreements and so on, it will be necessary to enact specific amendments to several Commonwealth acts which cannot be conveniently covered by the provisions in the present bill. I may add that, while the present bill and the subsequent legislation dealing with the transitional arrangements will, be designed to give the State governments every possible assistance in their own problems, there are numerous legal aspects of the change-over which can only be covered by amendments to the legislation of each State. The Commonwealth and State governments will be working in close liaison on such matters, and there has already been a meeting of the Parliamentary Draftsmen of the Commonwealth and the States to give preliminary consideration to these questions. I am sure it- will bc . of

Interest to honorable senators to know that the Law Draftsman of New Zealand was invited to attend this conference. He benefited greatly from the exchange of views as, indeed, did the Australian representatives benefit from the observations he was able to make himself. We will, of course, be working in the closest possible liaison with the New Zealand and British Governments in regard to our change-over arrangements, and there will undoubtedly be considerable mutual benefit in having these contacts.

It has been of immense help to us that the South African Government pioneered this field when it introduced a system of decimal currency early in 1961. We have studied the reports of the bodies set up in South Africa to advise the South African Government and we sent observers to South Africa to watch the change-over at close range. However, while we will be following the path pioneered by the South Africans in a number of respects, it should not be assumed that our arrangements will be exactly the same as those in South Africa, in such matters, for example, as Government compensation for the conversion costs of monetary machines.

The history of the decimal currency movement in Australia dates back to federation. Although there was no motion in the Senate, a motion was moved as early as June, 1901, in the House of Representatives by the then member for South Sydney -

That a Select Committee be appointed to inquire into and report upon the desirableness and expediency of the Commonwealth coining gold, silver and copper coins and adopt a decimal system of coinage.

The history in Britain goes back even further and might be said to begin with a motion made by Sir John Wrottesley in the House of Commons in 1824. The question was subsequently discussed by a number of royal commissions and select committees, but one step in the right direction was the introduction of the florin, or two shilling piece, in1 849 as one-tenth part of a pound. The two shilling piece eventually became part of the Australian currency system, and I am glad to say that a coin equivalent in value and similar in dimensions will continue to form an integral part of our new dollar-cent currency system.

The present Government’s first move on the decimal currency question was made in the Prime Minister’s policy speech of October, 1958, when he announced that the Government accepted the principle of decimal coinage and would, if returned to office, establish an independent committee to advise how and when and on what terms to effect this reform.

The Decimal Currency Committee was subsequently appointed in February, 1959. Its seven members were chosen as representatives of such fields as commerce, industry, banking, management, women’s organizations and the trade unions, and itwas given the following terms of reference: -

  1. The advantages and disadvantages which would result from placing the currency and money of account of Australiaon a decimal basis, including an estimate of the annual savings in cost to the community;
  2. if a decimal currency is favoured, the unit of account and denominations of subsidiary currency which it considers most appropriate for Australia;
  3. the method by which the recommended system should be introduced so as to minimize the cost and inconvenience of the changeover;
  4. the estimated cost of replacement or adaptation of accounting, calculating, vending and similar machines, and any other costs likely to be experienced;
  5. other aspects of conversion to a decimal system which it considers should be brought to the notice of the Commonwealth Government.

The committee reported to the Government in August, 1960. It recommended the adoption of a decimal system of currency based on a major unit equal to 10s. in value and made a number of valuable suggestions regarding the manner in which the proposed change should be brought about.

The committee reported unanimously that it was convinced that the adoption of a decimal currency system would be justified on the grounds of savings alone - that is, the savings would amortize the total cost of the change-over within a reasonable period. Although the committee did not consider that the period could be specified, it believed it to be sufficiently short to make the change a worth-while investment. After full examination, the Government is convinced that the change-over is justified, and that it will represent an important contribution to the welfare and convenience of the community as a whole.

The benefits of introducing a decimal system of currency will include the saving of up to half of the time our primary school children have to spend in learning arithmetic; the much simpler sums we will have to do in our everyday shopping; a noticeable saving of office and clerical time in the business world; and the advantages accruing from our business houses obtaining access to a much wider, and in many cases cheaper, selection of modern monetary machines.

It is not possible to quantify the savings resulting from the adoption of a decimal currency system, but the South African Decimalization Board has received reports from a wide variety of businesses to the effect that the cash advantages which they could attribute to the adoption of the decimal currency system were in many cases quite substantial.

The committee carried out a detailed examination of each of the various major units which it would be possible to adopt before deciding that the 10s. unit offered considerable advantages over all others. It recommended that there should be no half cent provided in the new system to replace the existing halfpenny. The committee estimated that it would cost approximately £30,000,000 to convert or replace monetary machines of the type which in South Africa had been accepted as the responsibility of the Government. This estimate was based on the assumptions that an official conversion programme would be adopted and, in effect, sponsored by the Australian Government, and that the changeover to decimal currency in this country would be made in February, 1963. The committee’s report is available to honorable senators. It is a most thorough and useful document and should provide nearly all of the background honorable senators will need to have a full understanding of the complex arrangements which will have to be brought into effect by the time of the changeover date. After examining the report, the Government affirmed its acceptance of the principle of decimal currency, but decided that it was not practicable to announce a definite time-table immediately.

In the first place, it was clear that a very large minting programme would be required if the changeover was to proceed smoothly. It was equally clear that the existing branches of the Royal Mint in Melbourne and Perth would not be able to provide the huge number of decimal coins which would need to be ready by the changeover date and the period immediately afterwards. Preliminary plans which had been commenced already for the construction of a new National Mint at Canberra were therefore pressed ahead. Secondly, the Government needed to examine closely the question of compensation payments for the cost of converting pounds, shillings and pence machines, which had not been included in the terms of reference of the Decimal Currency Committee. A study of the full implications of compensation payments was therefore commenced as a matter of urgency.

By late 1962, plans for the Canberra mint had progressed to the stage where completion might reasonaly be expected late in 1964. The study of the compensation question had also reached the stage where it could be examined at the Cabinet level. A committee of Cabinet was therefore appointed to look at these and other details of the proposed change. The committee recommended that a decimal system, based on a unit of 10s., should be introduced in February, 1966, if practicable. Cabinet endorsed this recommendation, and our decision was announced on 7th April last. The next steps were to decide the name for the new currency unit, to settle the nature of the new coins and currency notes, and to proceed with the appointment of a statutory body which would supervise the changeover arrangements and make recommendations to the Government on such matters as government compensation for the costs of conversion.

The controversy over the name of the new unit is familiar to all honorable senators, and I do not propose to go over all the ground again. Suffice to say that the Government originally decided to use the name royal after a close and careful examination of the many names which had been suggested up till last June, when the original announcement was made. It later became evident that there was a wide and deeply felt opposition to the name royal and, after leaving the question open for some time until the public had been given ample opportunity to form and express its views on alternative names, it was decided last month to adopt instead the name dollar for the new currency unit. It was also decided that the name for the minor currency unit of one-hundredth part of a dollar would be the cent, as originally proposed. Thc decisions which needed to bc made on coinage went far beyond those resulting from thc decision to adopt a decimal currency system. It had long been apparent that’ the sizes of the present bronze coins were inconveniently large, quite apart from thc fact that they were being produced at a substantial loss - that is, at a net cost to the taxpayer. More recently, a sharp increase in the world price of silver meant that the Government was also making a significant loss on the issue of its silver coins, even though these now contain only 50 per cent, silver and 50 per cent, base metals. Various possible alternatives were examined for white alloys, and it was finally decided that cupro-nickel - that is, 75 per cent, copper and 25 per cent, nickel - would be the most satisfactory alloy to replace thc existing silver coins.

At the same time, it was decided that it would now be appropriate to introduce a coin the equivalent of the present 5s. but wilh a much lighter weight than the cumbersome crown which was last minted in Australia in the 1930’s. This will be a prestige coin, which will be predominantly silver in its composition and will have a diameter roughly mid-way between the existing penny and the British half-crown. As it will only weigh the equivalent of approximately 2s. 3d. in our existing silver coins, 1 feci sure that the public is going to find this new coin particularly convenient. The three cupro-nickel coins will bc for denominations of 20 cents, 10 cents and 5 cents and will be indistinguishable in diameter and weight from the present 2s., ls. and 6d., thus allowing the new and the old coins to bc completely interchangeable during the transitional period. Although thc new coins will be 75 per cent, copper, they will have an attractive silvery appearance, and will be similar to the white coins which have been in circulation in Britain and New Zealand for nearly twenty years and in other countries for much longer periods. The two new bronze coins for 2 cents and 1 cent will be of the same alloy as the present Id. and id., but will be much smaller, the 2 cent piece being between the present ls. and 6d’. in diameter and the 1 cent piece slightly smaller than the 6d. In this connexion we arc watching the interests of blind people, and hope that the new coins will be readily distinguishable by them either through differences in diameter, milled or plain edges, and the relief of the design, which will as far as practicable incorporate bold numerals to indicate each denomination.

We have also taken some pains to consider the convenience of the public in general when determining the denominations and dimensions of the new decimal coins. I can illustrate this with the example of a person who decides to carry in his pocket at present a sufficient number of coins to meet any . payment of less than 10s. He would al present need at a minimum to carry ten coins - four florins, one shilling, one sixpence, one threepence, two pennies and a half-penny. With the introduction of the new dollar-cent system, such a person will need to carry only eight coins - one 50-cent piece, one 20-cent, two 10-ccnt, one 5-cent, one 2-cent and two 1-cent pieces. What is more, the weight of coins in his pockets will be reduced by approximately 40 per cent. Needless to say, this is also going to be a great advantage to business concerns which handle coin in bulk and, of course, will greatly facilitate the operations of the new Canberra mint, which will need to process much less metal than would otherwise have been the case. Arrangements for preparing designs for the new coins are proceeding, and it is hoped to commence production of at least one of the new bronze coins by the middle of 1964 at thc Melbourne and Perth mints. Production of the other coins will commence later, probably when the Canberra mint is commissioned in 1964.

For countries employing a pounds, shillings and pence system of currency, the choice of a suitable value for the major currency unit for a decimal system is not an easy one. No system is perfect. Some have unique advantages and others rule themselves out quickly because of technical disadvantages. Some form of compromise is necessary, and the sensible approach is to adopt the system which appears to offer the greatest net advantage, lt must bc kept in mind that in 50 or 100 years’ time, after the old system has been almost forgotten, there will be little to choose between any decimal currency systems, as long as they avoid fractions and are reasonably convenient in size by world standards. But we cannot overlook the transitional stage of up to two years, during which both the old currency and the new will be circulating simultaneously, and the public is entitled to a system which will help it through this transitional period with the minimum possible inconvenience. Accordingly, it is most important that there should be a ready, and if possible visual, method of association of values between the old and the new systems.

Possibly the most obvious system for a new decimal currency in Australia would either start with the £1 and decimalize downwards into one-hundredth parts of £1, thus retaining the existing values of all amounts expressed in units of £1; or start with the penny and decimalize upwards, thus retaining the existing value of all amounts which can be expressed in terms of pence. Unfortunately, there are distinct disadvantages involved in both courses of action, and for this reason the Decimal Currency Committee in Australia agreed unanimously with the committees in New Zealand and South Africa that the best system to introduce is one that builds itself around the shilling, with ten existing shillings being equivalent to the new major unit, and ten new minor units equal to the shilling.

The great disadvantage of retaining the £1 as the major unit in a decimal currency system is that a coin with a fractional denomination would inevitably have to be introduced, as a one-hundredth part of £1 or 2.4 pence, is obviously too large for the lowest unit in retailing transactions. Another disadvantage of the £1 as a unit is that there is not a ready relationship between amounts expressed in shillings and pence and amounts expressed in pounds and cents. For example, 17s. 6d. in the existing currency would become 87i cents under a £l-cent system, which is certainly not obvious visually. Yet another disadvantage is that all coins of 6d. denomination and below would have to be replaced. This would be unfortunate in many ways, particularly as the 6d. plays such a prominent part in coin-operated machines.

The Decimal Currency Committee which met in Britain under the chairmanship of

Lord Halsbury decided by a majority of four to two to recommend to the British Government the introduction of a system based on the £1. However, there are important considerations in Britain regarding the prestige of the £1 sterling in international commerce which apply to a much lesser degree in the case of the Australian £1. It was noticeable, too, that the minority report of the Halsbury committee was that the new decimal system should have a major unit equivalent to 10s., or the same as in Australia, New Zealand and South Africa.

Now I come to the 8s. 4d.-cent system. Suddenly, out of the blue, the Opposition came down recently in favour of this system - more than three years after the Australian Decimal Currency Committee unanimously made its recommendations to the Treasurer, and six months after the Government’s decision to introduce a 10s. system had been announced. It had been well known that legislation would be brought down this session to give effect to the Government’s decisions on decimal currency, thereby ensuring a full debate on all aspects of the question and, as I said in replying to the urgency motion, the motives of the Opposition leave me quite puzzled.

The 8s. 4d.-cent system, while attractive at first sight, has three main disadvantages when compared with a 10s. system. First, it would provide a very awkward conversion between the £1 and the dollar during the transitional period, and could be a source of annoyance for many years to come. For example, £14 would become $33.60, a conversion which would not come easily or quickly to the average Australian. Secondly, although any amount in pounds, shillings and pence could be converted exactly into the new currency by the simple expedient of converting it into pence and providing a decimal point, the actual conversion is far from easy for all but very small amounts. While 8 pence would become 8 cents, and 3s. 4d., or 40 pence, would become 40 cents, it would require some strenuous mental arithmetic to convert 17s. 6d., or 210 pence, into $2.10; or 59s. lid., or 719 pence, into $7.19.

A third, and very important disadvantage of the 8s. 4d. system, is that the penny would be the only existing coin denomination which could be retained under the new system, and we have in any case already decided to replace the penny by a -smaller coin. Coins equivalent to the existing 3d. and above, that is 3 cents, 6 cents, 12 cents and 24 cents, would have no place in a decimal currency system, and we would need to have available by the change-over date an adequate supply of new 1-cent, 2-cent, 5-cent, 10-cent, 20-cent and 50-cent coins, all of which would be circulating in a most confusing fashion with the existing coins through the transitional period. Already the banks are a little concerned about the introduction of three new coins during the transitional period under a 10s. system - that is, the 50-cent, 2-cent and 1-cent pieces’, but think of the confusion for banks, shopkeepers, bus conductors, &c, if twelve different coins were circulating during the transitional period - coins the equivalent of id., Id. - in two sizes - 2d., 3d., 5d., 6d., 10d., ls., ls. 8d. or 20 pence, 2s. and 4s. 2d. or 50 pence! As a matter of fact, the problem of minting such coins would almost inevitably rule out the possibility of introducing a decimal currency into Australia by February, 1966. There would be similar difficulties with currency notes, as new notes equivalent to, say, 8s. 4d. or $1, 16s. 8d. or $2, £2 ls. 8d. or $5, £4. 3s. 4d. or $10 and £8 6s. 8d. or $20, would be circulating for some time simultaneously with the present four Australian currency notes.

The principal advantage of the 10s. system is that it provides a ready and visual association of values for amounts up to about £5 during the transitional period. For example, 2s. becomes 20 cents and 35s. becomes $3.50. For amounts involving pence it is easy to obtain a close approximation visually. For example, 3s. 5d. is very close to 35 cents, the exact equivalent being 34 cents, and 59s. 6d. is very close to $5.96, the exact equivalent being $5.95. Where this is not sufficiently accurate, the precise conversion can be obtained by memorizing the conversion of amounts from Id. to lid. Simple tables showing these will be provided, but for any other system the conversion table necessarily would be far longer. For amounts expressed in pounds, it will be necessary to multiply by two but, while this is certainly an inconvenience, it will be a much simpler translation than would be the case with the 8s. 4d. system.

The 10s. system would probably use more of the existing coins than any other practicable decimal system. Thus all coins 6d. and above will have exact equivalents in the new currency, and can therefore be allowed to circulate for some time after the change-over date.

As I have said, no system is perfect, and one disadvantage of the 10s. system is that the cent has no exact equivalent in pence and that there must, therefore, be some adjustments in prices and other amounts which are not exact multiples of 6d., which will of course be equivalent to 5 cents. It has been argued that traders will tend to price their goods’ at the same number of cents as they are at present charging in pence, that is that everything costing Id. will become one cent, or 1.2d., and everything now costing 6d. will become 6 cents, or 7.2d., and so on. Therefore, it is argued, there will be a tendency for prices of items entering into the normal household budget to increase by up to 20 per cent. However, while it is true that there will inevitably be some upward adjustments to individual prices, it is equally true that there will be many downward adjustments. For example, the popular custom of pricing to lid. will no doubt be replaced by pricing to 9 cents, which represents a small reduction.

It will often be possible to adjust the quantity sold in each packet so that the price per unit will remain the same under the decimal system. It will also be possible to offset increases and decreases in prices where several products or fares or rates are involved - some can be adjusted downwards to offset others adjusted upwards. Another point is that, while a conversion from Id. to 1 cent represents a 20 per cent, increase, a conversion from ls. Id. to 11 cents represents only a li per cent, increase.

It would, I suggest, be quite unfair to see all businessmen as waiting their chance to to take advantage of the situation to reap windfall profits. There will undoubtedly be a few such individuals, but they will be a minority, and the various commercial and trade associations, which are jealous of the reputation and standing of their members, will be watching the situation. After all, if a trader is in a position where he is able and willing to exploit the public by adding a penny or two to his prices, why is he not doing it already instead of waiting twoandahalf years for the introduction of decimal currency? The Decimal Currency Board will be charged by the Government with keeping the situation under close review. Any exploitation is also likely to receive wide adverse publicity, particularly with the growth of consumer organizations. The all-important food sector is now an intensely competitive one with the advent of chain stores and supermarkets, and there is little likelihood of any but isolated profiteering.

Certainly I can assure you that the Commonwealth Government itself will not be using the introduction of a decimal currency system as an excuse for raising its taxes and charges fractionally. I am sure I can give a similar assurance on behalf of the State governments as well. Some charges may have to be increased slightly by force of circumstances, but there will be offsetting reductions in other related charges.

However, the best way to allay the fears of those who are worried about possible price increases is to refer to the experience in South Africa where, as I have said, the path has been pioneered for us in many ways. Decimal currency was introduced into South Africa in February, 1961. The general price index increased over the next two years by approximately 3 per cent., or about

H per cent, per annum. Much of this increase was due to rental adjustments, and the increase in the food index over the two-year period was only .7 per cent., while the clothing index actually fell by nearly 1 per cent. As the all-items index also rose by 3 per cent, in the two-year period preceding the change-over to decimal currency, it could hardly be argued that the introduction of decimal currency had any noticeable effect on prices in South Africa.

I have already mentioned that the Government has decided not to provide a half-cent coin in the new system. Many people appear to have assumed from this that no rates or charges will in future be quoted in fractions of cents; but there are many cases to-day where rates are expressed in fractions of a penny for which no coins exist, and this situation will, of course, be equally possible with the cent. There will, however, be no scope for this in retail prices or charges, except where these take the form of a rate per unit of quantity, as in the case of electricity.

The Government considers that the halfpenny has now outlived its usefulness, as was the case with the farthing, which, by the way, has never been minted as an Australian coin, even though we have been using our own coins for more than 50 years. It is interesting to note that the Halsbury Committee in Britain has come to the same conclusion about the halfpenny. It has, in fact, gone further, and has recommended that the one-hundredth part of the pound, equal to 2.4d. sterling, or 3d. Australian, should become the lowest accounting unit, with the lowest coin to be a halfcent equal to 1.2d. sterling or Hd. in Australian currency.

The inclusion of a fractional coin in a decimal system, although not unknown by any means, is in the Government’s view an unnecessary and complicating factor which is best avoided if possible. In this case, there was very strong evidence submitted to the Decimal Currency Committee that the halfpenny in the present system was now only of token value, and should be discarded. Given that a decimal system functions better without fractional minor units, there seems no convincing case for including a near-equivalent of the halfpenny, and thus perpetuating an outmoded denomination. Nevertheless, the halfpenny will continue to circulate for at least another four years from now.

The Decimal Currency Committee came to the conclusion that the only costs associated with the change-over which could be estimated with reasonable accuracy were those arising from the conversion of monetary machines. The committee also considered that, where no objective and accurate estimate of cost could be ascertained, there would be no practicable basis upon which relief could be provided. In addition, the committee pointed out that the costs of the change-over would fall most heavily on those employing monetary machines, while the benefits of a decimal system, although substantial in total for the community as a whole, would not necessarily coincide with areas of high conversion expenditure.

The Government therefore decided that it would accept the principle of paying reasonable compensation to owners of a large proportion of those monetary machines which will require conversion in order to be used under the new decimal system.

The Government’s decision on compensation was one of broad principle, and the first duty of the Decimal Currency Board will be to make a precise recommendation to the Government on which categories of monetary machines might receive full, cor nearly full, government compensation for conversion costs, which categories might be entitled to partial compensation, and which categories might be outside the Government’s field of responsibility.

When I inform honorable senators that there are at present in operation in Australia no fewer than 40 makes and about 190 different models of cash registers, accounting machines and adding machines alone, and that the age of these machines range from a few days to 50 or more years, you will see that the Decimal Currency Board has been given an immense task in formulating its precise recommendations. The board’s cost consultant and his staff have been working full-time on this problem for several months past, and they have had long discussions with the machine companies. The board hopes to be in a position to present its recommendations to the Treasurer late this year with a view to commencing early next year a registration of all machines which are eligible for the form of compensation which the Government decides to approve. The matter of compensation of conversion costs has been given the highest possible priority, and the Government’s exact intentions should in fact be announced much further in advance of the changeover date than was the case in South Africa.

It might assist honorable senators in their consideration of the bill if I sketch briefly the course of events which it is expected will be followed in connexion with the changeover. A fairly lengthy preparatory period is needed to enable the monetary machine companies to have all the necessary conversion parts manufactured, in overseas plants for the most part, and supplied to this country in time for conversion work to commence. This period is also needed, as I have indicated, to enable the produc tion of decimal coins to commence. A definite change-over date will be announced as soon as possible, and it will be from this date - often referred to as “ D-Day “ - that some part of the community will first commence to operate in decimals.

The only organizations which will be obliged to change to decimal operation from that date will be the banks. Since banks deal entirely in money, it would be quite impracticable for them to maintain their accounts in two currency systems. It is envisaged that banks will close for three or four days preceding the change-over date, during which time they will close off their pounds, shillings and pence accounts, convert all balances to decimals, and reopen on D-Day operating in decimal currency alone.

While some limited amount of machine conversion will be carried out in advance of the change-over date, the machine companies concerned will at that date commence a large-scale conversion operation, the extent of which cannot be gauged until the precise compensation arrangements are known. This programme will be designed to convert all those machines which are economically worth converting. The technicians will move progressively through the community, very probably on some regional or zoned basis, until all such machines have been converted.

No organizations other than the banks will be obliged to change to decimal operation from the change-over date, and the determining factor for most businesses will be when their machines are converted. It will therefore be left to individual concerns to make the change at their own convenience. We have no very clear idea at present how long the entire conversion operation will last, but it is likely that it will be a maximum of two years. During that period it will be necessary for both systems of currency to operate side by side so that businesses wishing to operate in pounds, shillings and pence until their machines are converted can do so. The banks, since they will be accounting in decimal currency only, will require all cheques to be written in decimals. However, for the duration of the transition period, they will supply pounds, shillings and pence notes and coin to any one who wishes to use them.

There are exact equivalents between the two currencies for all denominations of notes and coin down to and including the 6d. in value. Difficulties will only arise, therefore, with threepences and the bronze coins, where there are no exact equivalents. While there will be some inconvenience in this for business houses and other organizations, there will be little inconvenience to the individual consumer or shopper, as adequate changing arrangements will be provided to meet cases where businesses prefer to operate in either the new or the old currency only. By the time all machines have been converted, the existing bronze coins will, for the most part, have been returned to the banks, and will not be issued again. Later, existing silver coins will also be replaced entirely by new decimal coins but, since all but the 3d. have exact equivalents in the new decimal denominations, they can be used as decimal coins until adequate supplies of the new coins have been minted.

The new decimal coins and notes will be issued from the change-over date, the rate of issue being determined by the public’s demand for them. Our plans, however, are to ensure that there will be sufficient to meet all demands. Perhaps I should make it clear that the present bill makes no provision for new decimal currency notes. The denominations of the new Australian notes have not yet been decided, but there will at least be 1 dollar, 10 dollar and 20 dollar notes equivalent to the present 10s., £5 and £10 notes. Provision for the issue of these and other new denominations of the new notes will be made in due course by appropriate amendment to the note issue provisions of the Reserve Bank Act.

I now turn to the text of the bill before the Senate. Part I. is mainly of a machinery nature dealing with such matters as the coverage of the act. This part, together with Part V., which establishes the Decimal Currency Board, will come into operation immediately the bill receives the royal assent. The other parts of the bill will not come into operation until the actual changeover date, which will be fixed by proclamation. Provided that we are able to maintain the time-table at present proposed,the precise date will fall in February, 1966, but this will depend upon further examination of the question by the Decimal Currency Board. The act will not apply to the

Territories of Papua and New Guinea or Christmas Island, which make their own coinage arrangements. They could, of course, adopt the new currency if they wished.

Part II. provides for the repeal of the existing Coinage Act and for the introduction of the new system of currency. As I have said, this part will operate from the change-over date. However, its provisions will be temporarily modified to some extent by subsequent legislation dealing with the transitional period.

In clause 8 the major and minor units of the new system are defined and are related to the existing units of currency. Clause 9 provides that contracts, agreements, &c, are to be made only in decimal currency, although this will not necessarily be the case during the transitional period. Clause 10 provides for the calculation of amounts payable in decimal currency to discharge obligations expressed in the existing currency. As I have said before, this provides no difficulty when the amounts are in multiples of 6d., but there will be some minor discrepancies for smaller amounts. The conversion table set out in sub-clause 10 (2.) will ensure that any fractional overpayments will be offset on the average by similar fractional under-payments. Once again, this section of the bill is looking forward to the period beyond the transitional stage.

Clause 1 1 provides for the automatic substitution of amounts in the new currency for amounts in the old currency, where this is appropriate, in Commonwealth legislation and in bills of exchange, contracts, agreements, &c. While this blanket provision can be applied to a large number of Commonwealth acts without separate revision to those acts, a number of Commonwealth acts will require special attention before the change-over date.

Part III. and the schedule to the bill follow closely the provisions of the present Coinage Act, but it has been considered convenient to prescribe the precise weights and tolerances of the new coins by regulation rather than have them established by the bill itself. This is the general practice overseas, and allows for a little more flexibility in the minting processes. The precise dimensions of the new coins - particularly their thickness - cannot be finally determined until new designs and the extent of their relief have been approved and the coins themselves have been subjected to exhaustive tests.

Part IV. of the bill continues the existing legal tender provisions of the Coinage Act, adapted slightly to fit in better with the new system of currency. It will be noted that coins with a denomination of 5 cents or above will be legal tender for an amount equivalent to £2 10s. in the new currency, whereas existing silver coins are legal tender for only £2. The new bronze coins will be legal tender for an amount equivalent to 2s. in the existing currency whereas existing bronze coins are only legal tender for ls. Part V. provides for the arrangements necessary to prepare for the introduction of the new system.

Division 1 of Part V. provides the necessary definitions, while division 2 authorizes the Treasurer to enter into agreements and to make compensation payments in respect of the cost of converting specified types of monetary machines to enable them to operate under the new system. The clauses in this division are necessarily couched in general terms, as the exact compensation arrangements have not yet been determined by the Government. As I have said, the Decimal Currency Committee’s estimate of £30,000,000 for these conversion costs was related to the cost of converting all machines of the type which were eligible for Government compensation in South Africa. The actual cost iD Australia will depend on the Government’s final decisions, and cannot yet be estimated with precision. There will be more machines to convert in 1966 than there would have been in 1963, which the committee assumed as a change-over date, but we expect to effect economies as a result of the reports made by the observers we sent to South Africa to witness the change-over. In addition, there have been a number of technical developments since then in the monetary machine field which will greatly facilitate the machine conversion operation.

Division 3 will set up the Decimal Currency Board. The machinery provisions in this division are similar to the arrangements normally made for the establishment of bodies of this nature. The board is to make recommendations to the Treasurer on a number of matters relating to the introduction of the decimal currency system, the principal one being, of course, the compensation for conversion costs. Under clause 20 in division 2 the Treasurer may delegate certain of his powers to the board but, whilst the board will therefore be able to enter into agreements with machine companies with the approval of the Treasurer, payments of compensation to the machine companies or to individual owners of monetary machines will be made by the Commonwealth, and not by the board. Division 4 appropriates the Consolidated Revenue Fund as necessary and provides for the board to furnish the Treasurer with appropriate reports. It is expected that a little less than one-half of the total cost to the Government will fall in each of the years 1965-66 and 1966-67, with comparatively small residual amounts falling in 1964-65 and 1967-68. All of this expenditure will be included in the documents accompanying the Appropriation Bill fo/ the year concerned, and will thus be the subject of full parliamentary scrutiny. Part VI. continues a number of machinery provisions in the existing Coinage Act anc authorizes the Governor-General to mala regulations necessary for giving effect to thi act.

The bill is the culmination of several years of investigation by -Cabinet and by Government-appointed committees. During that period, honorable senators have shown a keen interest in development and many of the suggestions made by them, and by the general public, have been incorporated in the arrangements proposed under the bill. There is still a tremendous amount of detail to be settled before we introduce legislation dealing with the transitional arrangements following the change-over date, and I can assure honorable senators that any views they express on these matters, either during the forthcoming debate or later, will be given full consideration before the final procedures are settled. It is fitting that before I conclude I should mention the competent and thorough manner in which the Decimal Currency Committee carried out its functions. The committee’s report covered every possible facet of the decimal currency question, and I am sure honorable senators will refer to it frequently during the debate. The Decimal Currency

Board has most of its work ahead of it, but I am confident that we will receive from the board the same invaluable guidance and critical analysis that we received from the original Decimal Currency Committee. I commend the bill to honorable senators.

Debate (on motion by Senator McKenna) adjourned.

page 1406

INTERNATIONAL DEVELOPMENT ASSOCIATION (ADDITIONAL CONTRIBUTION) BILL 1963

Second Reading

Debate resumed from 23rd October (vide page 1382), on motion by Senator Paltridge -

That the bill be now read a second time.

Senator SANDFORD:
Victoria

– Mr. Deputy President, this bill is designed to obtain parliamentary approval of a contribution of 19,800,000 United States dollars to the International Development Association, commonly called I.D.A., which is an affiliate of the United Nations organization. It is interesting to note that according to the second-reading speech of the Minister for Civil Aviation (Senator Paltridge), by 30th June, 1963, 76 countries had joined I.D.A., whilst applications for membership from a further seventeen countries had been approved. It is significant that by 30th June, 1963, a large number of credit agreements had been signed, involving the sum of 495,200,000 United States dollars in respect of 39 projects in eighteen countries and territories. The Opposition supports the bill. Because of its laudable objectives, I do not intend to delay its passage through the Senate. However, it is interesting to note that it has the long-term objective of aiding underdeveloped and undeveloped countries throughout the world. This must have a cumulative effect in increasing living standards throughout what are commonly known as low-standard countries. This must be conducive to world peace. Australia is a foundation member of the International Development Association.

The contents of a book entitled “World Without Want “, by Paul G. Hoffman, are interesting to note. Mr. Hoffman has been described as the man who carried the

Marshall Plan to success. The book has been said to outline a stirring and practical programme to combat the poverty and illiteracy that enslave two-thirds of mankind and threaten explosive revolt in Africa, Asia and Latin America. According to the author of this book, if we do not do something to combat this great problem of poverty we are likely to have on our hands other Congos and Cubas. It is interesting to note that the vast amount of long-term financial assistance to be given to the underdeveloped and undeveloped countries by I.D.A. is to be provided free of interest. A nominal charge of only three-quarters of 1 per cent, will be made for administrative costs. Because of the laudable nature of this proposal, the Opposition has very much pleasure in supporting the bill.

Senator HANNAFORD:
South Australia

– Mr. Deputy President, it gives me very much pleasure to support the motion for the second reading of this bill. As Senator Sandford said, it has a most laudable objective and we can take very great pride in being associated with it I happen to know that Senator Sandford has been overseas. In view of the fact that he rose to speak on this measure, perhaps he attended the United Nations. I have a peculiar interest in this legislation because, in 1959, I attended the United Nations with the Australian mission. I had an opportunity of sitting on the second committee, that is, the economic committee, which deals with matters of this kind. That is why I should like to say a few words upon the measure.

I remember the discussions that took place in 1959 prior to the establishment of I.D.A. The general consensus of the second committee was that the establishment of I.D.A. was a most worthy objective and that the association could easily be embodied in the machinery of the United Nations organization. This view was later adopted by the General Assembly. I.D.A was developed not to take the place of the International Bank for Reconstruction and Development but to be complementary to that bank. We know the splendid work that has been done by the International Bank, but I.D.A. provides a service which is quite different from the conventional financial arrangements for which the International Bank is responsible.

As Senator Sandford said, no interest is attachable to loans from I.D.A. In that respect it is different from conventional banks or finance houses which legitimately charge interest for their services. All I.D.A. credits are for a term of SO years and are repayable in convertible currency, repayment to commence after a ten-year grace period. Many people may not completely understand the difference between convertible currency and inconvertible currency. Throughout the world there are many countries whose currencies are not readily convertible. My understanding is that the ten-year grace period before repayment commences is to enable such countries to build up reserves of convertible currency which would be acceptable to I.D.A. After the ten-year grace period, 1 per cent, per annum of the principal is to be repaid for ten years, while in the remaining 30 years 3 per cent, of the principal is to be repaid annually. I should say that that repayment would be in convertible currency. Honorable senators, therefore, can see that the arrangements of I.D.A. are unconventional and entirely different from ordinary financial arrangements to assist undeveloped countries.

The economic committee of the United Nations is regarded as one of the really important committees. It was of very great interest to me to be, as a member of the Australian mission, party to the deliberations of delegates from various countries. I suppose the principal function of the committee is to hear and determine matters and to forward resolutions to the Economic and Social Council and other agencies which work in the interests of underdeveloped regions. The decision to establish I.D.A. was taken in 1959. The association came into being in 1960. This was a very big step in the right direction and I am very proud that Australia has been associated with this body since its inception. Originating members of the association numbered 76 countries and applications from an additional seventeen countries have since been approved. The initial subscriptions to the association amount to the equivalent of 969,000,000 United States dollars, of which the equivalent of 765,000,000 United States dollars is payable in convertible currencies.

Fairly rapidly after 1960, 39 projects in eighteen countries, involving credit agree ments amounting to 495,200,000 United States dollars were commenced. I gain some satisfaction from the fact that a large percentage of those projects were in underdeveloped Commonwealth countries. Whether or not we like it, the Commonwealth of Nations has a large proportion of under-developed countries and it has been to their advantage to be able to go to I.D.A. for financial assistance in development. Credits to Commonwealth countries account for 68 per cent, of all credit agreements. About 7 per cent, of the total credits have been extended to Latin American countries, 7 per cent, to African countries or territories, 8 per cent, to the Middle East, and 78 per cent, to Asia. Some of the Asian countries concerned are included in the Commonwealth countries which account for 68 per cent of the total.

Because of arrangements entered into with Pakistan and India, I.D-A.’s uncommitted resources have been largely reduced, although a proportion remains uncommitted. If the funds were not augmented, the association could be in difficulties. It is therefore proposed by the board of governors of the organization that the funds be increased. This bill relates to Australia’s contribution of additional funds.

Senator Benn:

– The money does good work.

Senator HANNAFORD:

– I quite agree. I have not been able personally to examine the work that is being done, but I feel certain that if this money were not made available to under-developed countries their development would be long delayed. I believe that the more enlightened and relatively wealthy countries like Australia have an obligation to assist in the development of the less fortunate peoples. So we see some justification for increasing our contribution towards this assistance. Economists have said that it is really good business on our part and on the part of the other more highly developed and prosperous countries to assist countries which are lagging in development and have a low standard of living. None of us realizes fully how inferior is the standard of living in some countries, including some not far from our shores. I agree that it is good business on our part to contribute generously to their assistance and to help to raise their standard of living. The Australian Government thinks that way also and has done everything within its financial resources to assist.

Senator Benn:

– The fund will operate in addition to the International Bank for Reconstruction and Development.

Senator HANNAFORD:

– As I said earlier, this is supplementary to the International Bank for Reconstruction and Development. We are taking full advantage of the bank’s facilities in Australia; but this is quite different and quite unconventional from a financial aspect. It opens the way for countries which are not in a position to go to the conventional finance houses or raise money in a conventional way to get money through this organization. The organization provides terms completely different from and much more generous than those provided by the International Bank or other world financial houses. It is not necessary for me to go into the pros and cons of the work of the International Development Association.

Senator Benn:

– Does the honorable senator think that this is making a contribution to world peace also?

Senator HANNAFORD:

– Quite definitely. I thank Senator Benn for his interjection. Where there is a level of prosperity there is a much better prospect of peace. However, that is not the complete answer by any means. We must make our contribution to those who live in underdeveloped and depressed regions. It is essential that we build them up financially. But we can contribute in other ways to the peace of the world. We can adopt a more tolerant attitude to trade, for example. Sometimes the attitude of certain developed countries can be described as selfish. They create difficulty for some of the underdeveloped countries which are mainly primary producers and hamper them in raising their standard of living. Some countries have adopted what has been termed economic nationalism and by their restrictive and selfish methods have prevented primary producing countries from earning sufficient income to raise the standard of living of their people.

Economic nationalism is rampant and we have seen it adversely affect our own country. Countries like France have adopted a rather selfish attitude in relation to their own industries. We have seen countries which are most suitable for certain types of primary production penalized because European countries have tried to make themselves economically self-sufficient at the expense of depressed countries which rely on the export of primary products. This action has militated against the primary producing countries getting decent prices for their products. Their markets have been closed, and this has had a depressing effect on their standard of living.

Much can be done to create a freer flow of trade. If a country is eminently suited for the production of particular products it should have relatively free access to world markets so that it can sell its produce at reasonably profitable prices. That in itself would be the biggest contribution that could be made towards lifting the standard of living in some of the countries I have mentioned. Australia has played a very creditable part in assisting some of the under-developed countries. We can take pride in our contribution to the Colombo Plan.

Senator Benn:

– Does the honorable senator think that the ordinary citizen is aware of what is done?

Senator HANNAFORD:

– That might not be so. Unfortunately, it takes a long while for these things to filter through to the community; but there is a general realization in Australia that we contribute to the Colombo Plan. We have seen that plan at work ever since this Government has been in office and we are proud that we are held in high esteem because we have met our responsibilities. Our contribution to the United Nations and our assistance to the Economic and Social Council of the United Nations and various other funds has been commendable. Certainly we need not be ashamed of the part we are playing.

The Minister for Civil Aviation (Senator Paltridge) mentioned in his second-reading speech that we have agreed to increase our contribution to this fund and that this action has been taken after full consideration of the other activities in which we have participated. As the Minister pointed out, Australia has offered a contribution of 19,800,000 American dollars over the three years period compared with a subscription of 20,180,000 dollars for the initial period of five years. So the actual amount being .provided is to be stepped up from 20,180,000 dollars over five years to T9,”800,000 dollars over three years.

According to the schedule attached to <the Minister’s second-reading speech our share of the new resources from which this fund will benefit will go up to 2.64 per cent, of the new resources. The contributing countries are mostly the developed countries. They have all agreed to increase their share of the new resources, thus building them up from the original annual rate of 147,890,000 American dollars to 250,000,000 American dollars. That will mean a considerable increase in the amount of money available to the association.

There are many ways to assist underdeveloped countries. We all should strive for a freer flow of trade, which is essential ito (the economic development of >countries which depend mainly on primary production. When I was at the United Nations, great stress was laid on .the factor of industrialization, but capital is necessary in order to develop industrial activity. When the Treasurer :(Mr. Harold Holt) was overseas recently he expressed the view that other resources could be added to the financial resources at present in existence by setting up capital centres. He urged the International Monetary Fund and the International Bank to make a study of ways and means to expand, diversify and strengthen international capital markets. While I recognize that the International Development Association is an extremely valuable adjunct to the International Bank and -other financial organizations which exist in ‘the world to-day. I do not concede that it is the whole answer to the problem of assisting under-developed countries. I believe that we must play our part, as we are well able to do, in helping to build up the resources of the association so that under-developed countries may have recourse to them.

The bill has a laudable objective. I am sure that if the Australian people fully understood what we are doing in :this direction : they ‘would agree that we are merely acknowledging our responsibility to humanity. In many parts .of the world living standards are .miserably low. Assistance by the International Development .Association, limited though that assistance may be, is a means of helping to improve .those standards. Therefore, I feel that we are doing the right thing in increasing our contributions to the association, in common with other signatory nations. For those reasons, I think we should give our full support to this measure.

Senator LAUGHT:
South Australia

– I, too, support the bill. I am pleased by the attitude of the Opposition, as shown by the speech made by Senator Sandford and the intelligent interjections of Senator Benn. The honorable senators have clearly shown that they are right behind the purposes of the bill. The International Development Association has been in existence since 1960. Australia is one of the original members of it, having paid its subscription in 1960. The committee of the club, as it might be called, has met and has decided to make a call on subscribers. We are now faced with the need to authorize the Government to pay the call. Senator Sandford and Senator Hannaford discussed in detail the purposes of the bill. Senator Hannaford was .fortunate to be present at the United Nations, in New York, when this lusty infant was bom. As will appear during .the debate, in three years the infant has developed a fairly good appetite, but I am not concerned about that because its appetite has resulted in great benefit accruing to many parts of the world.

I was interested to note, at page 5 of the sixteenth .annual report of the International Bank for Reconstruction and Development, which has been in existence for about eighteen years and which has taken a great interest in the proper growth of the International Development Association, the following statement: -

The Bank itself was joined by a .new affiliate: the International Development Association, designed to aid economic growth with credits bearing less heavily on the balance of payments of under-developed countries than conventional loans.

The charter of the association provides for an unconventional system of repayment No repayment by way of capital is required for the first ten years. For the next ten years, repayments are at the rate of 1 per cent, per annum, and for the last 30 years of the 50-year term they are at the rate of 3 per cent, per annum. All the time, however, there is a service charge of threequarters of 1 per cent. If the money that is made available to a country by the association is wisely applied it can be of great benefit to that country.

I am interested to note, also, that the International Bank for Reconstruction and Development, which has developed a technique over the years, has in fact coached the new organization in the way in which its activities should be handled. The following statement appears in the report of the International Bank: -

IDA has a separate legal existence and its own funds, but is administered by the same officers arid staff as the Bank; its first Annual Report is being published separately from this Report Of the Bank. IDA has had a considerable impact on the work of the staff, involving the investigation of a wider variety of projects that are financed by the Bank and the dispatch of missions to countries where the Bank, with its more exacting financial terms, was not able to lend. These investigations and missions are implementing the policy that IDA projects shall be as thoroughly prepared as those financed by the Bank, to ensure the maximum economic benefit in the countries which borrow from the new Association.

It was important to the new association that the experience of the International Bank, gained over fifteen years, should have been available to it, and also that the assistance of Mr. Eugene Black, with his fine personality, also should have been available in the association’s formative years. That fact gives me great encouragement to recommend to the Senate that it should approve the bill.

I have had a look at some of the reports of the new organization. As honorable senators may imagine, they are prepared in almost the same manner as are the excellent reports of the International Bank. The reports indicate that immediately money was made available, the association got to work. The first report is for the period from November, 1960, to 30th June, 1961. The officers of the association, through the president, Mr. Black, have made the following significant statement: -

IDA has no policy of allocating its funds in advance. An effort is being made, however, to assure wide geographic distribution of development credits, taking into account the priority which should be given to the poorer countries.

At the same time, it probably will be necessary to observe a limit on credits for some countries which could quickly present enough suitable projects to absorb a disproportionate amount of IDA funds.

The emphasis is on the priority which could be given to the poorer countries which are not normally acceptable for loans from the International Bank for Reconstruction and Development. Notwithstanding that priority is to be given to the poorer countries, this statement has been made -

In adminstering its funds, I.D.A. will have the same regard as the Bank to the observance by recipient countries of sound financial and economic policies and to the careful selection and preparation of projects or programmes which may be financed.

It will be seen that the excellent tradition of the International Bank for Reconstruction and Development has been observed.

The second-reading speech of the Minister for Civil Aviation (Senator Paltridge) is quite interesting in regard to the geographical spread of risks. About 7 per cent, of the total credits have been extended to countries in Latin America, 7 per cent, to African countries, 8 per cent, to the Middle East and 78 per cent to Asia. I was interested to note from the last report that is available to me - it is a roneoed statement which gives a summary of principal activities from 1st July, 1962, to 28th February, 1963 - that the most recent interests of the association have been in countries quite near to us. The sum of 60,000,000 dollars has been appropriated to India for the expansion and improvement of telecommunications and the expansion and improvement of the port of Bombay. Ethiopia has received 13,500,000 dollars for highway construction. An additional sum of 30,000,000 dollars was made available to India for the Purna irrigation power project and the Koyna power project. It will be observed that the targets will make for increased production in those countries.

Senator Hannaford raised an interesting point as to whether Australia should engage in such activities outside her own boundaries. As I understood Senator Benn’s interjection, he felt very keenly about that too. I believe that Australia ought to cast her bread upon the waters. Australia has been doing that to quite a degree lately. In the current financial year we will contribute £44,000,000 to projects outside -the mainland of Australia. For example, a contribution of £25,000,000 will be made to Papua and New Guinea for the development of the native people. In addition, contributions will be made under the Colombo Plan and for aid through United Nations agencies.

We might ask whether our contribution under the bill now before us is significant and is in keeping with our capacity. I think it is. The statement which the Minister incorporated in “ Hansard “ yesterday when he was delivering his second-reading speech shows that Australia ranks eighth amongst the nations that will participate and we regard ourselves as being approximately the eighth trading nation in the world. Our contribution in terms of new resources will be 2.64 per cent. It is interesting to note that the United States of America will contribute 41.6 per cent; the United Kingdom, 12.88 per cent.; Germany, 9.68 per cent.; France, 8.2 per cent.; Canada, 5.56 per cent.; and Japan, 5.5 per cent.

Senator Hannaford:

– That is, of new resources.

Senator LAUGHT:

– Yes. That proportion is approximately the same as in the case of the original contribution. It will be observed that Australia is not lagging behind. Senator Benn asked, by way of interjection, whether this assistance would help to ensure peace in the world. I really think it will. I should like to illustrate my point by referring to some information I discovered when I was in Indonesia recently with a parliamentary delegation. We had already visited Malaya, Burma and Thailand. When we got to Indonesia we discussed with fairly representative people Blow things were going in that country. It seemed that far too much was being spent <on security and military preparations. It was stated that Indonesia was spending 76 per cent, of its resources in that direction. Some of the money which is spent on the military forces might well be contributing to general development, because apparently the military forces do a good deal of roadmaking and that sort of work. We were told that the Indonesians were aiming to reduce this item of expenditure to less than 50 per cent.

It was quite apparent to me that, because so much was being spent on security and military preparations, little could be spent on real development and social services. I believe that the availability of money through the United Nations agencies, of which the I.D.A. is one, for long-term purposes and on such easy terms of repayment could well open the way for such countries to do something about national development. I hope that some of the countries that are experiencing difficulty at the present time with development will be able to seek approval for and obtain their share of the funds.

As earlier speakers have said, quite a number of countries in South-East Asia are primary producing countries and to them the existence of world markets is of importance. The availability of a market for tin and rubber will govern the viability of Malaysia for some years to come. Any capital development which might flow from sources of finance such as the one we are now considering could well be the forerunner of development as a result of capital inflow from private sources. I hope that the recognition which these countries will receive from this association will encourage other sources to make capital available.

I wish to follow up a point that was raised by Senator Hannaford. Under the Colombo Plan, £1,000,000 is being made available by Australia to Thailand for the specific purpose of building feeder roads in the northeast of that country. Capital development is being assisted by the provision of heavy earth-moving equipment and of men to train the Thais in its use. The capital inflow of £1,000,000 from Australia under the Colombo Plan could increase production enormously in Thailand, enabling the people to construct feeder roads and thus get their produce to markets at all times of the year.

Having observed all these things recently in South-East Asia I can quite understand how this money, to be made available through this association, could be of great value to the people in those parts. By making their economy stronger it will certainly make them more contented and will tend to maintain peace and security in that part of Asia. Malaysia has a rural development plan and is in need of heavy earth-moving equipment, road-making equipment, bridge-building equipment and other types of machinery. I hope that the country will become interested in this source of money. Indeed, I hope that this money will supply the development needs of all of the new emerging countries of South-East Asia.

I wholeheartedly support the bill. I commend the association for the way it has progressed during the last three years. I am thankful that it has received expert guidance .from the International Bank for Reconstruction and Development and I am glad that the Australian Government has seen fit to make its second subscription of an amount which I think is quite appropriate. The subscription brings Australia’s financial interest in the people outside the mainland of Australia to an amount of £44,000,000.

Question resolved in the affirmative.

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

page 1412

APPROPRIATION BILL 1963-64

Bill received from the House of Representatives.

Standing Orders suspended.

First Reading

Motion (by Senator Paltridge) proposed -

That the bill be now read a first time.

Debate (on motion by Senator McKenna) adjourned.

page 1412

APPROPRIATION (WORKS AND SERVICES) BILL 1963-64

Bill received from the House of Representatives.

Standing Orders suspended.

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

Second Reading

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

– I move -

That the bill be now .read a second time.

This bill, in conjunction with the Supply (Works and Services) Act 1963-64 will provide for expenditure from <the Consoli dated Revenue Fund on Capital works and services as .follows: -

The proposed expenditure was outlined in the Treasurer’s Budget speech and is detailed in the Schedule to the present bill. The Schedule is the same as that contained in the “ Particulars of Proposed Expenditure for Additions, New Works and Other Services involving Capital Expenditure for the .Service of the Year Ending 30th June, 1964 “ which has already been examined in detail by the .’Senate in committee.

Debate (on motion by Senator O’Byrne) adjourned.

Sitting suspended from 4.3 to 4.46 p.m.

page 1412

CURRENCY BILL 1963

Second Reading

Debate resumed (vide page 1406).

Senator McKENNA:
Leader of the Opposition · Tasmania

– This bill is a vitally important one, .affecting not merely the business community but also the welfare of every person in Australia. Everybody has a most intimate contact with the currency from the time that he reaches the age of reason until he departs from this mortal sphere. Therefore, we are now legislating on a matter that will have a most important impact upon the whole community. For that reason, among others, on behalf of the Opposition I move, as an amendment to the motion for the second reading -

Leave out all words after “ That “, insert: - “ the Senate, whilst supporting the proposed introduction of decimal currency, considers that a decision as to the monetary unit and money denominations should not be made until the people of Australia have had an opportunity, during the forthcoming general election campaign, to make known their opinions and that, accordingly, further consideration of the proposals should be deferred until the meeting of the sew Parliament’”.

I suggest that’ there was never a bill before this, chamber that more needed, a, select committee of the Senate to examine it. The. Decimal Currency Committee sat for. many years on this subject and produced a most exhaustive and’ complex report. This is a matter with which the- minds of honorable senators are not familiar, let alone the minds of people outside who, I am’ quite certain’, do- not realize the impact that’ this measure will1 have upon their’ lives.

On a side issue of this matter, the naming, by the Government of the new major unit, the Minister for Civil Aviation (Senator. Paltridge), told us in his second-reading speech that it was only after close and careful consideration that the original name “royal”’ was chosen. That was a simple decision on a simple matter, but it provoked, as the Minister acknowledged’, a storm of protest from the people of Australia. As a consequence, the Government changed1 its mind.

In relation to the new unit, I say without doubt that most people do not understand the differences between the 10s.- 100 cent proposal and the 8s. 4d.-100 cent system. I even go so far as to say that many honorable senators - including myself - and members of another place, do not feel completely confident to assess the difference between the two systems. This is a complicated matter. It is the kind of matter that, above everything else, ought to be examined exhaustively and’ leisurely in this chamber. Having regard to the approaching election, it is even more important that a matter of this consequence should not be disposed of, after a 33-page roneoed’ second-reading speech, by proceeding, immediately with the debate. I think the electors are entitled to regard us as treating this matter far too lightly,, having regard to its very great consequences.

The Opposition raised, doubts in the matter of a. choice between the 8s. 4d.dollar and the lOs.-dollar by moving the adjournment of the Senate on 9th October for the purpose of debating this, question. I hope that at least we indicated then that these was an argument in favour of the 8s. 4d.-dollar as against the lOs.-dollar which has been selected by the Government. That subject could, be argued exhaustively and objectively over a. period of time, instead, of being disposed of. to-night in a debate’ to- which’,, in- view of the approaching election, no honorable senator is particularly minded: to> address his best intellect.

I shall, come to the report, of the Decimal Currency Committee presently. When, one reads that report one finds that, even in the view of this expert committee, which I acknowledge has done wonderful work in this matter, there is. a pretty fine line between the lOs.-dollar and the 8s. 4d.-dollar systems. I acknowledge that the committee decided’ unanimously in favour of the former, but I believe that its members addressed’ their minds far too much to the complexities of the transitional period, particularly for the business community, I suggest that they did not address their minds as completely as. they should have to the impact of the proposed system upon the individual Australian man or woman. They were concerned,, quite properly, about the difficulties of. the transitional period but no matter which method, is adopted, there must be a period’ when two currencies are operative and’ when there will be a great deal of confusion. Difficult though the change-over may be, it will end. What the Senate should address its mind to is the ultimate effect of the change-over.

With the adoption of the lOs.-dollar system: we sees the threat of price increases, and we see also incipient, inflationary pressure. I shall come back to that feature in a moment, or two.. We have been told that, before the decimal currency is implemented many other bills, will have to be put through) the. Parliament and that State legislation: will be, required. There cannot be any violent hurry- to pass this measure because the; Minister has indicated that the schemewill not become operative until some date in, 1966. In the meantime, if we pass this bill, we merely bring into operation immediately two parts of it. The first is Part’ I., which, provides preliminary machinery; the other is Part V., which establishes the Decimal Currency Board to go ahead with’ all< me planning- that ‘ is required to- bring the; decimal system- into operation. There is no> need foc haste for a1 month or’ so having: regard to- the fact that 1966 is the year in which the1 scheme is to- come into operation. Other parts of the bill that are controversial will not become’ effective until 19«6.

I suggest to the Minister that it is impossible for the Government to justify making a decision on a matter of such consequence when the electors are waiting to pass judgment. It is a matter of great importance and of great consequence to the public, and it is a matter upon which I should say the people have very little knowledge at this stage. The general public does not read a report of this nature which does not have a wide circulation.

This bill has not been in the position of the matrimonial causes legislation, or the marriage legislation or the proposals in relation to restrictive trade practices, information concerning all those matters has the widest circulation in the community. There was a wide controversy in the newspapers in which all kinds of people at all levels of life were engaged. Consequently, the public was well informed on those subjects and had a thorough understanding of them; and they influenced the Government’s proposals and consequent legislation considerably. The restrictive trade practices proposals are the latest example of that procedure. That approach has not been taken in relation to this vastly important measure. I invite the Government to consider that. I submit that the Government has no justification for hurrying this bill through the Parliament at the moment.

Accordingly, the Opposition has moved an amendment which will not affect the implementation of measures which ought to be implemented now, such as the setting up of a board and the provision of machinery measures, but will affect only proposals which are not to become effective for at least three years. We think it is wrong to rush a decision when the people may, by a change of government, put the disposal of these matters beyond the power of the present Government. Surely a piece of major legislation such as this should not be introduced in the dying hours of Parliament and on the eve of a general election. That is the approach of the Opposition to this particularly important and interesting measure. We do not oppose, at all, the introduction of a decimal system. However, prior to the introduction of such a system there should be patient study, long controversy and objective discussion in order to find out what is good not for one section of the community but for the great body of the people - the individuals of Australia.

We have been told that there will be a transitional period of between eighteen months and two years while both the existing currency and decimal currency are operative. I have conceded that there can be great confusion in that period. But probably the greatest motive power in the world is self-interest. If one were to impose on the people of Australia the responsibility of learning and understanding the new decimal system, merely as a mental exercise, one would not achieve very much result; but when the proposal is made the medium that affects people’s pockets it instantly excites the vital force - self-interest - and they learn quickly. They will learn in almost a day. I feel justified in saying that, when I indicate that going around the world, visiting the United Kingdom, the Common Market countries and the United States of America, stopping at intermediate ports briefly on the way, I encountered a new currency every few days, but I had no difficulty in using each currency with the aid of a little conversion table much smaller than the ordinary envelope. I had not the faintest difficulty with the currency in any of these countries although each had its own. I do not say that I did not get some shocks. I recall that when I made a purchase in Rome that was to cost me about £181 was presented with a bill, as I thought, for £36,000, the lire sign being written exactly as is the £ sign. Frankly, I confess to having been shocked. I did not think that I had so much money with me as to meet a bill for £36,000 at a moment’s notice.

Senator Marriott:

– That would be a change, would it not?

Senator McKENNA:

– It would be a real change. However, I was almost instantly at home with the eight or ten different currencies that I encountered in the course of a few weeks. With the motive of selfinterest to guard the hip pocket, people will learn very quickly. We must not take too seriously the transitional period in the introduction of decimal currency, because it will end. Then the minds of the people will flow straight to the one currency and we shall be afloat. We should not allow our approach to this bill to be conditioned entirely and dominantly by the difficulties inherent in the transitional period.

One of the difficulties in that period will be the conversion of money machines to handle computations in decimal currency. That, too, will be merely an ephemeral problem. It will happen only once. Preparation for it will be necessary. The process of conversion will be costly. For a time it will cause some embarrassment and some difficulty. This is inseparable from the introduction of any new scheme. Furthermore, the cost of conversion will only have to be met once. From the viewpoint of the business community I invite the Senate to remember that although this bill does not deal with the basis of compensation payable in respect of the conversion of machines the Minister for Civil Aviation, in introducing the bill, indicated that compensation would be payable broadly, although not exactly, in accordance with the rates of compensation paid under the South African scheme. Compensation payable in Australia, on the basis of the rates paid in South Africa, would cost the taxpayers of this country £30,000,000. However, that amount would have to be paid only once. We must be careful in safeguarding the welfare of the business community so meticulously that there are not any drawbacks to this scheme which will be continuous and permanent in the lives of the people of Australia. That is the attitude of the Opposition.

On 9th October one of my colleagues put to this chamber that there would be an increase in prices resulting from the fact that the lowest unit of decimal currency, under the Government’s proposals, would be one cent which would be the equivalent of one and one-fifth pence. One of my colleagues calculated that the price of about 157 items in common use, including foodstuffs and newspapers, as well as fares, would be affected and that all price increases could total £50,000,000 per annum. It might be said that that is not a vast amount of money when divided among 10,000,000 people, but such price increases have a cumulative effect. They represent an increased cost which, unlike the cost of compensation for the conversion of machines, is not met only once. Increased prices will have to be borne by people, day in and day out, year in and year out. This might well have a cumulative effect. We must weigh these factors. I repeat: Do not let us be too concerned about the difficulties of the transitional period, real though I consider them to be.

In speaking to the motion for the adjournment of the Senate on 9th October in respect of this subject, Opposition senators expressed fears as to what would happen when the new currency was introduced. They pointed out that the tendency would be for retail prices to rise rather than fall. If that is true we shall have increases in the prices - small increases, let us say-of individual items which, multiplied by hundreds of millions of transactions, will mean vast fortunes to those who deal in the small cheap commodities of every-day use. If the price of an article is in pence only, there will be an increase through the conversion to cents. If it is in shillings and pence, there will be an increase of the portion that is in pence. These increases could add up to a colossal cost to the people. The lowest of the new units will be die cent, which will be equal to 1.2d., or lid. People will not think in terms of lid. They will think in terms of 1 cent. That will be the basis. They will not worry about the id. in their thinking and calculations. The minds of business people and of the community generally will fix upon 1 cent as the unit. In a very short time they will stop thinking about pennies.

I do not propose to traverse all the arguments that were very eloquently addressed from this side of the chamber on 9th October by Senators Kennelly, O’Byrne, Toohey and Cohen, as well as by myself. Although the debate lasted only three hours, we adequately expressed our views on that occasion. I merely record the fact that what we had to say then may be found at page 94 and following pages of “ Hansard “ of 9th October, 1963. Not one of us withdraws any of the arguments that we addressed to the Senate on that occasion.

I should like to refer now to a speech made by the Minister for Labour and National Service (Mr. McMahon) on the same date when the subject was raised as a matter of urgency in the House of Representatives. As appears at page 1594 of “Hansard” for the House of Representatives he dealt with one of the arguments that’ had1 been raised by the Opposition in the- other place as well- as in this’ chamber. He said -

The answer to the Opposition’s argument- may be- stated in this way: First’ of all, 1 do not think that there will be a. very great: impact on our cost, of living.

I pause there to say that the- Minister did not deny that there would be an impact. He denied that there would be a very great impact. He continued -

We examined’ this aspect: There were so many advantages on. the other side that we wereprompted to the conclusion that the balance was in favour of the lOs.-lOO cent system. Even if there were some increases in prices the working man would not lose permanently. Under’ our system of adjusting the- basic wage in accordance with movements of the consumer index, the working man would very quickly get back in terms of an increased basic wage any additional costs he might have to meet. I do not think that in the short run the average wage- earner will suffer.

That was Mr. McM’ahon’s contribution to thought on that argument of the Opposition. I remind the Senate that the Government parties, back, in 1.948, when the Labour government of the day submitted to the people a referendum seeking to give this Parliament control over prices, argued that no control was needed and that if we left everything to competition prices would fall. That was the solemn assurance that was given. The referendum proposal was rejected and prices did not fall. They rose from then until 1949 when, in the course of an election campaign, the Government parties again’ told the same, story. They said: “Let free enterprise run free. Trust to competition and prices will fall.” We know the answer to that: We remember the promise to- put value- back. into, the £1. The truth is that the value- of money has depreciated. At least half of its value has disappeared in the interim.

Senator O’Byrne:

– They are getting rid of the £1 altogether now.

Senator McKENNA:

– They are getting rid of the £1 altogether and substituting the dollar. We say to the Government, and to Mr McMahon in particular, in- answer to the story about competition controlling prices, that this is against all experience. The Arbitration Commission now is prepared to review the basic wage only once a year. Quarterly cost-of-living adjustments were abolished at the instance1 of the Commonwealth Government. Mr:

McMahon is quite wrong when he says that increases in. prices can quickly be overtaken by wage, rises. The Opposition has in mind the fact that - I think in 1960 - for the first time in history the Commonwealth Government stood’ before the Arbitration Commission and argued against any increase being made in the basic wage.

So the argument that is addressed to usby. Mr. McMahon leaves us quite unmoved. It is all very well to say that if prices go up workers will be reimbursed. There, will be at least a year’s delay, and in any case there is no certainty of wage increases. Certainly the workers will not be reimbursed, retrospectively. Even if what Mr. McMahon says-, were true, it would, only bring about what the Opposition fears - increases in prices, immediate applications, for wage increases, and consequently, another inflationary spiral, to the detriment of our export trade and balance of payments position.

However, looking at Mr. McMahon’sargument, we see that it is baseless. We have no reason to believe that his expectations will be realized. The people who will suffer are the wage-earners. We realize that, day by day, the business of this country is falling more and more into the hands of monopolies. Back in 1960, the Government acknowledged that this was so. In March of that year, when the GovernorGeneral opened the parliamentary session, we were told’ that the Government would introduce legislation to deal with monopolies and restrictive trade practices. That is almost four years ago and nothing has been done. It is this very aggregation of monopoly that will eliminate the very thing upon which Mr: McMahon and the Government are relying - the free run of competition. Control of prices of foodstuffs, clothing, and all the other things- that the people use every day of their lives is being put more and more into the hands of fewer and fewer organizations. Whatever virtue competition has, its scope is being curtailed day by day. The Government has acknowledged the trouble but has only talked about it for four years. So we draw no encouragement from Mr. McMahon’s remarks.

He went on to say -

There are. two other arguments, that I believe to> be decisive and of overriding importance. The first is that undoubtedly there will be increased competition over a wide range of articles in the consumer goods or retail trade. I have no doubt that in the large stores - Woolworths and Coles, for example - competition will be so great that they and very few retailers will exploit the market or affront public opinion by blatantly increasing their prices over a wide range of goods. Perhaps the prices of some articles will increase but there should be no increases over a very wide range of goods. Competition will gradually pull the prices back and the consumer will be sure of getting a fair deal. I do not want it to be thought that I am ignoring the fact that there will be an attempt by some people to exploit the change. I am sure that there will be, but I am equally certain that, having regard to the keen competition which has existed in the past and which we can expect to continue during the next five or ten years, increases will be kept to a minimum. They certainly will not be anywhere near as great as the Opposition has argued.

Implicit in that last sentence is an acknowledgment that there will be price increases. That is an acknowledgment of the basis for the complaint that the Opposition makes over this proposal. I want to refer briefly to the report of the Decimal Currency Committee. At page 34 the committee reviewed the 8s. 4d.-cent system, and in paragraph 153 it dealt with the question of the simplicity of this system. The committee commented -

It has the virtue of simplicity inasmuch as it is a two-decimal system. The relationship between the old and new denominations of coin is easy to understand, since this system retains the penny AH existing coins could, therefore, continue in circulation for a time although, as explained in paragraph 160, this course would give rise to many practical difficulties and would not be desirable.

With the leave of the Senate I incorporate paragraph 160 in “ Hansard “.

Some advocates of this system argue that all the existing coins (and notes) could continue in use after its introduction. They base their case, presumably, upon the fact that all decimal values have exact equivalents in pence. This view fs, however, an over-simplification which ignores the many practical problems that would arise in the absence of decimal denominations, quite apart from the impracticability of continuing to use existing coins denominations of 1, 3, 6, 12 and 24 cents. If the difficulty of “ making up “ change, from the viewpoint of shop assistants, is considered, the impracticability of continuing to use existing coins (excepting the penny and halfpenny) becomes apparent. The practice is to make up change to the next highest shilling, and then to go on until the amount tendered is reached. This simply could not be done for the 8s. 4d. unit, or most multiples of it, with the existing coins. Similarly, since 8s. 4d. is an exact multiple of only the penny and halfpenny, among existing coins, it would be impossible for banks to make up packets of threepences, sixpences, shillings and florins to the value of the new major unit, or most multiples of it. It would therefore be necessary to replace all coins excepting the penny and halfpenny as from the change-over date, a task which would be quite beyond the capacity of the present Mints unless over a period of several years, lt must also be pointed out that, in view of the evidence (referred to in paragraph 246) regarding the unpopularity of the penny as a coin in many quarters, it may even be necessary to replace the penny itself at some future time.

At paragraph 154, the Decimal Currency Committee hit a note that appeals to the Opposition by commenting -

From the point of view of the needs of the community, this system is conspicuous for the fact that, providing a half-cent is circulated, it is the only one which need involve no change in values in pricing.

I want to underline those words “ the needs of the community “. The committee has said that, for the needs of the community, the 8s. 4d.-cent system is the system. In other words, this is easily the best system for all individual Australians. That is the thought that dominates the minds of the Opposition. We are concerned about the good of the people as individuals. After all, business can look after itself. In paragraph 155, there is this statement -

The system is fairly satisfactory from the machine aspect.

There is no trouble about the conversion of machines. The paragraph continues -

As a two-decimal system, the choice of new decimal machines would be quite as wide as for the £-cent (assuming no complication arising from a half cent) and lOs.-cent systems, though with some reduction in capacity.

The committee is saying that the 8s. 4d.cent system will work in relation to machine conversion equally well as the £1 unit or the 10s. unit. So there is nothing between the two systems on that point. In any event, the conversion is a purely temporary thing, and those owning the machines are to be compensated by the taxpayers. So we need not shed any tears over them. At paragraph 157, the committee said about the 8s. 4d.-cent system -

Although eminently satisfactory from the viewpoint of the lower denominations, the chief disadvantage of this system lies in the relationship of the new major units to the pound. All statistics, financial records, contracts, bank balances and other amounts expressed in terms of pounds would have to be altered, and this would require multiplication by 2.4 involving recourse to machines, comparatively laborious manual calculations or ready reckoners.

That does not tear at my heartstrings. If the financial institutions with their machine computers and staffs cannot multiply by 2.4, or if that is to be a hardship, they are very soft indeed. My sympathy cannot be excited in their favour, and after all is said and done this is only a temporary phase too. This is a problem of the transitional period. In the case of the banks, it will be over after four days. We are told that the banks will close for four days and thereafter all their accounting will be in decimals. I will not lose any sleep over their difficulties in multiplying pounds by 2.4. It is the merest detail, and it is this struggling for an argument that does not impress us - the argument in favour of the interests of finance and business.

Senator Prowse:

– Who is struggling for the argument?

Senator McKENNA:

– I do not mind the honorable senator wondering. Does he suggest that there is a real difficulty for the banks and financial institutions in multiplying pounds by 2.4? Does that appear to be terrifically embarrassing? Even I could do it, and I would have no computing machines or anything of the kind. Where is the trouble? The Decimal Currency Committee has rather strained itself in saying that multiplying pounds by 2.4 would present difficulties. I refer now to paragraph 158 which states in part -

The disadvantage arising from the awkward relationship of the major unit to the £ is paralleled by the lack of associability of values between this system and the existing currency.

Then the committee points out that up to 8s. 4d. the penny is equivalent to !he new cent; there is no change at all under this system. But you have to divide by twelve to reduce the original currency to dollars and cents. For how many Australians W1 it be a problem to divide by twelve - or multiply by twelve if you take the reverse process - to convert shillings and pounds to dollars and cents, particularly when your activity is inspired by selfinterest? I do not see the difficulty that the committee sees there. I think it is stressing these things unduly and any difficulty will be for a comparatively very brief transitional period. I make one more reference to the report. In paragraph 230 the committee states under the heading “ Conclusion and Recommendation “ -

The outstanding advantage of the 8s. 4d.-cent system is the exact equivalence of values for all £.s.d. amounts which do not include halfpence. The lOs.-cent system has an exact equivalent for every amount in shillings or ending in sixpence, and has the advantage over the 8s. 4d. unit of providing an easy conversion to pounds and a ready associability of values, as well as retaining the shilling as a decimal denomination.

Then it makes this conclusion -

In economy of figures there is little between these two systems, although since the 10s. unit is slightly higher in value it has the benefit of what difference there is.

There again, even in the mind of the committee that made the recommendation, it is acknowledged that the difference in the virtues and disadvantages of each system is drawn with a very fine line.

The Minister, in his second-reading speech, dealt with three main disadvantages. In the course of my general remarks I have perhaps covered the points he made. In referring to the 8s. 4d.-cent system, he said -

Firstly, it would provide a very awkward conversion between the £1 and the dollar during the transitional period. . . .

I think I have answered that argument. He went on -

Secondly, although any amount in pounds, shillings and pence could be converted exactly into the new currency by the simple expedient of converting it into pence and providing a decimal point, the actual conversion is far from easy for all but very small amounts.

I have dealt with that argument, also. The Minister continued -

A third, and very important disadvantage of the 8s. 4d. system, is that the penny would be the only existing coin denomination which could be retained under the new system. . . .

What would that matter? There are to be new coins from beginning to end. Who wants to retain the penny? New coins are to be made, so what does it matter if there is one more new coin? The penny is big and cumbersome, but frankly, I do not follow the third argument submitted by the Minister. I do not see the virtue of the argument that he has addressed in this respect and should be grateful if he would pursue the matter when he replies to the debate.

It seems to me and to the Opposition that the Government is more concerned to ease the path of business during the transitional period than we are. The Opposition is far more concerned, and it thinks properly so, with the welfare of the individual people of the Australian Commonwealth. I hope that, in the circumstances I have outlined, the Senate will accept the motion I have put forward, not for the purpose of rejecting the bill but in order to defer it for a period of approximately one month. I take it that the Parliament will re-assemble very soon after the election. I do not know whether a date has yet been fixed for the return of writs, but when a date is fixed the Parliament must come together within 30 days of it.

Senator Wedgwood:

– Would not that be early in February?

Senator McKENNA:

– It could be. , It is within the competence of the Government to fix a date for the return of the writs. My feeling is that the date will not be so late on this occasion as on previous occasions, because there is not ‘to be a general election for the Senate. There is to be an election for only one Senate vacancy, in Queensland. Generally, the date for the return of the writs is fixed fairly well ahead to enable the results of the Senate voting to be concluded. So, I should expect the Prime Minister (Sir Robert Menzies) and the Government to appoint a reasonably early date for the return of the writs, and that we would be re-assembling at the end of January at the latest.

Senator Kendall:

– It might depend a little on the Queen Mother’s visit.

Senator McKENNA:

– Yes. Of course, that event might involve a meeting of the Parliament. I do not think I expressed myself accurately when I said that we could defer the bill for a month. In saying that, I meant that we could put off for a month a decision in the matter and give the people the opportunity to determine which of the two proposals they prefer. They could express their opinion either in favour of the Government or of the Opposition, because the subject of decimal currency will be one of the matters to be raised during the election campaign. I think that is certain. If we won the election we would claim that, having raised the matter, we had a mandate to go ahead and do what we felt the people had authorized us to do. We have to wait only a month for that decision.

Out of consideration for the people, I think we should defer the bill. At the worst, I imagine that we shall be coming back here towards the end of January, or not more than three months from now. There is no reason for haste. If the Government were to cut the bill down to Part I. and Part V. we would pass it in a moment. Then, whichever party was elected to office could look at the operative parts of the bill which, in any event, will not be put into force until 1966 but for which preparations have to be made in the meantime.

Senator SCOTT:
Western Australia

– I rise to support the bill. I am rather amazed that the Leader of the Opposition (Senator McKenna) should have moved an .amendment which merely requires the Government to defer a decision regarding the value of the currency until some time after the forthcoming - general election in order to enable the people, .of Australia to consider the matter.- We had a debate on the subject of decimal currency in the Senate about a fortnight ago. On that occasion, Senator Kennelly, who is the Deputy Leader of the Opposition, spoke on behalf of the Opposition and advocated the adoption of the 8s. 4d.-cent system. He put forward most of the arguments which the Leader of the Opposition presented today, and he stated the reasons why the Opposition believed the 8s. 4d.-cent system should be adopted. One of those reasons was that there would be a terrific increase in costs if the lOs.-cent system were adopted, despite the fact that the Decimal Currency Committee stated, in many paragraphs of its report, that in its firm opinion there would not be violent increases although there might be slight increases in the initial stages.

We must remember that the Government and the Decimal Currency Committee, before making their recommendations, studied reports from other countries. A system of decimal currency has been in operation in South Africa since February, 1961. That country adopted the lOs.-cent system, as Australia proposes to do. It may be assumed that, under the South African system, the cent would be equivalent to 1.2d. and that if violent increases in the cost of living were to follow the adoption of the l Os.-cent system they would have occurred in that country during the two years in which the system has been in operation. When we study the cost index system of South Africa we find that over the two years costs have increased by only 3 per cent., or an average of 1.5 per cent, a year. The costs of foodstuffs have increased by only .7 of 1 per cent. In the same period there has been a decrease of 1 per cent, in the cost of clothing. 1 believe that is sufficient evidence to convince reasonable persons that violent increases of costs do not follow thc adoption of the 10s. -cent system. 1 was pleased to bear the Leader of thc Opposition say that if the amendment was not carried thc Opposition would raise this issue during thc forthcoming election campaign. If it does, he will have to argue against the recommendations of a committee of six mcn and one woman who were appointed by this Government and who took evidence throughout Australia from -200 or 300 different organizations and 150 or 200 individuals. The report of thc committee must make a terrific impact on the people of Australia.

The Leader of the Opposition supported his argument by reading certain paragraphs in the committee’s report. He read those which he said favoured the adoption of the 8s. 4d.-cent system. The report consists of more than 400 paragraphs, of which the honorable senator read about half a dozen. The main paragraph which condemned the 8s. 4d.-cent system is paragraph 160. Senator McKenna obtained leave to incorporate that paragraph in “ Hansard “, but I propose to read it so that honorable senators may compare it with the ones read by the honorable senator and so they may form their own opinion about which is the best system to adopt.

Senator McKenna placed great stress on paragraph 153 and then he read paragraphs 154 and 155. Paragraph 154 states - . .

From the point of view of the needs of the community this system is conspicuous for the fact that, providing a half-cent is circulated, it is the only one which need involve no change in values in pricing.

That is very important. Now I propose to read paragraph 160 which, as I said, thc Leader of thc Opposition incorporated in “ Hansard “. lt states -

Some advocates of this system argue, that all trie existing coins (and notes) could continue in use after its introduction. They base their case, presumably, upon the fact that all decimal values have exact equivalents in pence. This view is, however, an over-simplification - which ignores the many practical problems that would arise -in the absence of decimal denominations, quite, apart from the incongruous nature of a decimal system with denominations of 1, 3, 6, 12 and 24 cents. If the difficulty of “ making up “ change, from the viewpoint of shop assistants, is considered, the impracticability of continuing to use existing coins (excepting the penny and halfpenny) becomes apparent. The practice is to make up change to the next highest shilling, and then to go on until the amount tendered is reached. This simply could not be done for the 8s. 4d. unit, or most multiples of it, with the existing coins. Similarly, since 8s. 4d. . is an exact multiple of only the penny and halfpenny, amongst existing coins, it would be impossible for banks to make up packets of threepences, sixpences, shillings and florins to the value of the new major unit, or most multiples of it. lt would, therefore be necessary to replace all coins excepting the penny and halfpenny as from thc change-over date, a task which would be quite beyond the capacity of the present Mints unless over a period of several years. It must also be pointed out that, in view of the evidence (referred to in paragraph 246) regarding thc unpopularity of the penny as a coin in many quarters, it may even be necessary to replace the penny itself at some future time.

That was the viewpoint of the committee which was appointed to inquire into this matter. The more one reads the report the more one becomes convinced that there really is only one system that we should adopt - the 10s. -cent system.

With the concurrence of honorable senators, I incorporate in “ Hansard “ paragraphs 230 and 231. 230. The outstanding advantage of the 8s. 4d.cent system is the exact equivalence of values for all £ s. d. amounts which do not include halfpence. The lOs.-cent system has an exact equivalent, for every amount in shillings or ending in sixpence, and has the advantage over the 8s. 4d. unit of providing an easy conversion to pounds and a ready associability of values, as well as retaining the shilling as a decimal denomination. In economy of figures there is little between these two systems, although since the 10s. unit is slightly higher in value it has the benefit of what difference, there is. 231. Judging from the evidence received by the Committee, the simplicity and other - advantage* of the 10s. -cent system appear to be. more widely appreciated than the merits of the other system*.

In paragraph 232 the committee stated -

The Committee has, therefore, after very careful analysis of all these systems-

They include the 5s.-cent system, the £1 systems, the 8s. 4d.-cent system and the 10s. -cent system - concluded that the10s.-cent system is the most appropriate for adoption in Australia. For the reasons set out, the Committee recommends

  1. that the10s.-cent decimal system should be adopted;
  2. that no provision be made for a half-cent, but that the halfpenny be re-valued to serve as a half-cent for the duration of the transition period.

That was the unanimous recommendation of the Decimal Currency Committee. Yet members of the Opposition come forward now and say that we should accept the amendment they have proposed so the people of Australia may have further time in which to consider the matter, and that if we do not adopt the amendment we will hear more about the matter during the forthcoming election campaign. It will suit us if the Opposition raises the matter.

I am convinced that the Government will not accept the amendment. We have been investigating this matter since 1958. In his last policy speech, the Prime Minister (Sir Robert Menzies) said that if the Government were returned to office it would appoint a committee to inquire into the decimal coinage system and would probably adopt its report. The Government appointed that committee. It has adopted its report and has introduced legislation to implement its recommendations. I support the bill.

Sitting suspended from 5.47 to 8 p.m.

Senator AYLETT:
Tasmania

.- I rise to support the amendment moved by the Leader of the Opposition (Senator McKenna). I do so for various reasons which I shall state. I do not intend to go into the merits or demerits of the bill at this juncture because I consider that it would be utterly impossible, with the short notice we have had of the bill, for any honorable senator - at least on this side of the chamber - to do so. This is one of the most important bills to come before the Parliament since the last general election. It will concern every individual in Australia, from the baby in its cradle to elderly people approaching the end of their lives.

Broadly, the Opposition does not oppose the principles of the bill. My personal view is that a bill to introduce decimal currency into Australia is long overdue. So it would be difficult for anybody to oppose the bill. However, as it is a major bill which covers many aspects of our currency system it requires due consideration. It is a bill the effects of which, when decimal currency is introduced, will cause confusion throughout the country. We must expect these things. If decimal currency is introduced in the right manner it will be to the advantage of Australia in the long run. That is why the Opposition is not opposing the bill in principle, although it considers that the time allowed for its consideration - by the Opposition at least - has been completely inadequate.

There is no need for undue haste in this matter, and no reason why the bill should be introduced at this juncture, allowing no time for the Opposition to give it due consideration. Decimal currency will not operate for more than another two years yet. There are many features of the bill that do not justify the way it is being rushed into the Parliament at this time.

Senator Scott:

– You have had only six years to think about it.

Senator AYLETT:

– The Opposition had no details of this bill until very late this afternoon. It was so late that my leader had to request that the Senate be suspended for half an hour to enable him to study the bill. This gave the Leader of the Opposition an opportunity to make a few notes to enable him to lead the debate for the Opposition. Because of his legal training the Leader of the Opposition has a more alert brain than most honorable senators. We require more time than he does, but even with his alert and astute brain the time was completely inadequate for him to do justice to the subject.

I repeat that the time has been completely inadequate for members of the Opposition to give the consideration to this matter that it deserves. There is no justification for the undue haste. The new mint to be established in Canberra has not even been commenced, and will not be completed for another year. That is another reason why there should be no undue haste to pass this bill. This a controversial matter with the general public. Some considerable time ago the Government announced that one of the major denominations of the new currency would be called the royal. The Opposition did not have any part in selecting that name. It did not offer any opposition to it in the Parliament, but because of the resentment of the public throughout Australia, the Government decided to drop the name “royal” and selected the name “dollar”. With inadequate time to consider this bill how are we to know that there are not other features of the Government’s proposals that the general public might resent as bitterly as they resented the name “ royal “?

The introduction of this coinage system will cause endless confusion if the people do not adequately understand what is involved. Until the bill is properly considered nobody can give to the people of Australia the adequate explanation that they justly deserve. If they are,not adequately prepared for the change-over to the decimal coinage system the confusion that will be caused will be ten times worse than the confusion that occurred over the choice of the name “ royal “. I ask for leave to continue my remarks at a later stage.

Leave granted; debate adjourned.

page 1422

ROYAL AUSTRALIAN AIR FORCE

Ministerial Statement

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

– by leave - The statement I am about to read is a statement that is being read by the Prime Minister (Sir Robert Menzies) in another place. When I use the first personal pronoun it will be understood that it refers to the Prime Minister and not to me. The statement is as follows -

On 22nd May of this year, I made a comprehensive announcement about a review of Australian defence, of the defence programme and of defence expenditure.

The decisions I then announced involved an average increase in the defence vote over a period of five years of the order of £41,000,000 a year. At the same time, though I stated the nature of the extended Mirage fighter procurement, I pointed out that neither the programme nor the figures included any re-equipment of the strikereconnaissance force. I went on to say -

This is an ‘ important matter. ‘ The Canberra is by no means obsolete; it is still being used by overseas air forces, including those of Nato

But we are giving close consideration to the future as we must. There are, of course, great financial ‘problems, but there are vital questions as to the availability of suitable types to meet out requirements. Having regard to our special geographic circumstances, we must consider range, the capacity to perform both reconnaissance and attack and the ability to use existing runways and services. An on-the-spot evaluation by a team of qualified experts is necessary, as it was in the selection of the Mirage. Such a team will bc sent overseas at an early date, under the Chief of the Air Staff, to investigate and report. Then, of course, the Government will consider the matter further in the light of the report.

We sent the evaluation team overseas and in due course received its report. It was clear that, subject to problems of the timetable and of payment and of interim provision to supplement if necessary the Canberra force, the evaluation team regarded what was then called the TFX in the United States as the most modern and complete answer to our requirements.

I then decided to ask Mr. Townley, the Minister for Defence, to undertake the very onerous task of going to the United States to examine these problems more closely. He had, of course, one further objective. He was not to discuss aircraft in isolation from strategic needs and priorities, but he was to have close political consultation with the United States Administration on those very matters. It is very easy, if I may say so to the Leader of the Opposition, to say, “ We will procure a Canberra replacement “ as if all we had to do was to go, so to speak, to the shop and buy it over the counter.

Honorable members will realize that this is not the position to-day. Both- of the two most recently designed reconnaissance bombers, the TSR-2 in England and the TFX in the United States, are still .in the developmental stage. It will, of necessity be some time before they become available. The cost of such modern instruments of war is, of course, enormous, - although the cost tends to come down if very large orders are placed. . *<

The Minister for Defence has the great advantage of being on very close and friendly terms with the American defence administration. My colleagues and I felt that he would have a reasonable prospect of fruitful discussion. I am happy to tell the House that his mission, has been most remarkably successful; so successful that I have found it necessary to advise the United Kingdom Government that we propose lo go ahead with thc arrangement he has negotiated,

Before going on to state the substance of the arrangement that my colleague has made in Washington, I would like to say that 1 have observed some inspired statements in one or two newspapers to the effect that our discussions in the United States were either accelerated or affected by some statement made in this House by the Leader of thc Opposition (Mr. Calwell). The answer to this is that we had our first full and promising report from the Minister before the Leader of the Opposition spoke at all. Having received it and studied it, we were attracted by it, but we sent one or two inquiries to him so that he might clear up a few outstanding points. This he has done, with the result that I will in a few moments announce it to the House.

The whole business of re-equipping the Air Force is extremely complex. It cannot be solved by a few rhetorical phrases. It has in the present case required most exhaustive technical investigations by our highest technical advisers and this rather remarkable negotiation has been conducted by the Minister himself in the United States. In the result, the defence programme I announced will of course be very substantially added to. But the arrangements made by my colleague will unquestionably result in a very substantial saving to Australia, as against the original estimates of TFX costs as formulated when the evaluation mission made its inquiries. To this must be added the other practical defence advantages which will appear.

I will now state in agreed language the nature of the arrangements that have been made. In pursuance of the Government’s policy of improving Australia’s defence preparations, the Minister for Defence has been in Washington discussing with Mr. McNamara, the United States Secretary of Defence, the re-equipment of Australia’s bomber squadrons, together with . other defence matters of mutual interest. As a result of these negotiations, the following most favorable arrangements have .been made with the United States: - The Government of Australia has agreed to purchase from the United States two squadrons of F-111A aircraft, which used to be called the TFX. By special arrangements with the United States of America, the aircraft will be available to Australia at the same time as deliveries are made to the United States armed forces, which will be from 1967 onwards. Financial arrangements are entirely satisfactory to Australia.

In a most favorable “ package deal “ the United Stales has agreed to supply the aircraft on the basts of a purchase price that includes one year’s initial spare parts including engines, ground handling equipment, training aids, and the initial and operational training of crews, which would be carried out in the United States.

A further important and valuable consideration is that the United States has agreed to integration of the R.A.A.F. and the United States Armed Forces logistic pattern so that Australia will be able to draw future requirements of spare parts and equipment from American stocks and therefore secure the advantage of much lower prices than would be the case if Australia itself had to procure independently the full range of stores. The financial arrangements for the purchase of the F-111A aircraft enables Australia to spread its payments to suit its own budgetary requirements over a period of years. As Australia will commence progress payments immediately, a special and important part of the deal is that Australia’s payments will attract interest from the United States until such time as payments are in fact made to the United States contractors for the aircraft.

The F-111A aircraft will now be available to Australia at least two years earlier than had previously been thought possible. At the same time, in case the years between now and 1967 were to see a deterioration in the international situation, thc Government has been concerned that Australia should have, if necessary, some additional long-range strike and reconnaissance capacity in the R.A.A.F. over the. intervening years. Arrangements have now been made to ensure that there will be suitable strike reconnaissance aircraft available to the R.A.A.F. until the F-111A comes, into operational service. Agreement has been reached with the United States that up to two squadrons of B-47/RB-47E aircraft will be made available to Australia, with no leasing charge to the Australian Government. Australian personnel will be trained by the United States Air Force on the basis of reimbursement for actual costs, and ground handling equipment and logistic support provided at satisfactory prices.

Performance details of the F-111A arc classified but it can be said that it is a twoman bomber which can fly at two and a half times thc speed of sound and well above supersonic speed at sea level. It can take ofl and land from short and, if necessary, rough airfields. It can fly to any place on earth within 24 hours.

The TFX programme, embarked on by the United States, is the largest programme, both in numbers and in cost, of any Aircraft since World War II. Twenty-two prototype and development aircraft are scheduled for delivery to United States in 1965. The B-47E is now used in the Strategic Air Command of the United States and will be in squadron service for some years. It has proved a most versatile and effective aircraft in operational service to date. Its full operational capability is still partly classified but it has a subsonic speed of over 600 miles per hour and a ceiling of over 40,000 feet. It is also particularly effective at low level. It is a six-engine aircraft with a range of over 3,000 miles and a capacity to carry over 20,000 lb. of conventional bombs. It is equipped for air-to-air refuelling.

I am sure all honorable members will agree not only that my colleague’s mission reflects credit on himself but also that its success is an indication of the high opinion which the United States Government has of the capacity of the Australian armed forces and of the reliability and importance of Australia as a nation in this area of the world.

Senator McKENNA:
Leader of the Opposition · Tasmania

– by leave - The Minister for Civil Aviation (Senator Paltridge) began his narration of events with thc 22nd May, this year, when the Prime Minister (Sir Robert Menzies) made a comprehensive statement on defence. I think we ought to go back a little earlier than that, to April, 1957, when the Prime Minister made an earlier comprehensive statement on defence. He had found at that time that Australia lacked adequate ships of the right kind, that our army needed to be overhauled, and that we needed new fighters and new bombers. That was six years ago. In the interim there has been quite a large number of missions abroad which have been looking, inter alia, for a new bomber. Minister after Minister went abroad on that search. Now, on the eve of a general election, we find that there is a sudden sortie to the United States of America and a very fine arrangement is made to obtain the latest type of aircraft to re-equip the Royal Australian Air Force with a strike reconnaissance force - two squadrons in 1967 and onwards.

I said on a previous occasion in this place, somewhat facetiously, that the Government would want ten years notice of a war. In actual fact, it is working out to that now because it was back in 1957 that the need for these aircraft appeared. May I remind the Senate that the Prime Minister (Sir Robert Menzies) indicated in April, 1957, that the Government had decided upon the fighter that it wanted - .he American Starfighter. He sent Sir Philip McBride to the United States of America immediately in order to make final arrangements. In a supplementary statement Sir Howard Beale said that we would make the Starfighter in Australia. We still have the Avon Sabre. When Sir Philip McBride came back in a month or two he found the decision that had been made was futile because the Starfighter was not adaptable to our purpose. It was supersonic and it wanted far too much electronic ground equipment. Accordingly, the decision that had been made was reversed within months. To-day, six years later, we still have the Avon Sabre. We are told that it is to bs replaced by the Mirage some years ahead. To-night, we have heard the statement of the Minister for Civil Aviation (Senator Paltridge) regarding the bomber.

I express my delight on behalf of. the Opposition that our logistics in relation to aircraft are to be integrated with those- of the United States. - I am delighted at the continued “generosity of the United States Administration in coming to our aid with the new type of bomber. I understand that we are to have two squadrons of- B-47E bombers. In other words, if I understood the Minister correctly, Australia is to have no financial commitment in respect of these two squadrons until we get the F-111A bomber. That is a most generous offer, if that is the case. The Opposition pays a great tribute to our ally, the United Stales of America, for that generous gesture.

But T wonder whether it was the proximity of a general election that stirred the Government to action in such a hurry. I take it that the F-111A aircraft have been on the drawing board and under discussion for a very long time. Could this decision to purchase them have been made a little anterior to the fixing of an election date? Why did not the Government approach the United States concerning the two squadrons of B-47E bombers mon.hs earlier? Did we make any previous request to the United States Government that it should sell or lend us aircraft? The generosity of the United S States Government and its readiness to integrate its forces with purs is well known. I welcome the announcement that we are to have something like a strike reconnaissance force. I welcome this American gesture. I deplore the fact that the Government took so long to take such a step in the interests of this country. I only wish that the Government had been more active in other fields in relation to defence. But at least I am cheered by the news that I have heard to-night.

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

– by leave - Mr. President, I wish that the Leader of the Opposition (Senator McKenna), in speaking upon such an important matter as this, had not tied his observations to the fact that we are on the eve of a general election. It is so easy to associate any decision that is made, with an election in the offing, with electioneering tactics. This matter had engaged the consideration and the deep concern of the Government for many months prior to the time at which we decided to hold an election. It is an unrealistic approach to think that important defence decisions such as this can be quickly reached and quickly carried into effect. Our original desire naturally was to acquire aircraft for the Royal Australian Air Force ourselves. That we did in respect of the Mirage fighter, which is a straight-out acquisition on terms by the Government. But when we came to the problem of acquiring reconnaissance aircraft, despite the fact that we sent missions overseas and had the best technical advice that the Air Force was capable of providing, we could find no practical solution upon conventional lines.

In that situation wc had cither to take action upon lines which, up to this stage, have been thought unconventional by Australian defence standards, or not have the aircraft which the Government thought was necessary, and which the Government’s professional advisers considered to be necessary. These were the circumstances in which we decided to make an unconventional approach to the problem. In this situation we were assisted by the great personal standing and prestige of the Prime Minister (Sir Robert Menzies). Do not let us put that fact to one side in a matter of this consequence. Do not let us be altogether too cynical. In this respect, national matters are not different from business matters or political matters. A man’s personal standing, his prestige and integrity are of great consequence. The Prime Minister’s personal standing and prestige were of consequence in a transaction such as this.

Against that background the Minister for Defence (Mr. Townley) went to Washington and has hammered out the details of this arrangement which the Opposition has been able to criticize only on bogus grounds. This criticism cannot bring any comfort to the Opposition. On a great national matter like this which, in the world in which we live, goes to the very basis of the security and integrity of Australia, it is unfortunate, Mr. President, that the Opposition, whilst conceding that. this arrangement will help to keep Australia secure, should challenge the bona fides of the Government. That is an unworthy stand for the Opposition to take. After all, we are all Australians and we will remain Australians whatever may be the result of the election. In a matter of this consequence, for the Opposition to say that this is a political issue does it no credit at all. This arrangement will fill a big gap in Australia’s defence preparedness. This is equipment that we hope we shall never have to use and the mere filling of the gap will make it less likely that there will be need to use the equipment. I should have thought that this was an occasion on which the Opposition might have said to the Government, “ Well done “.

Senator O’BYRNE:
Tasmania

– by leave - The Leader of the Government in the Senate (Sir William Spooner) has accused the Opposition of having unworthy motives in passing comment on the statement that has been read on behalf of the Prime Minister (Sir Robert Menzies). He is quite naive about the fact that we are on the eve of an election and that this statement has been made, obviously, for public consumption. He spoke of politics being brought into such a matter. But the Prime Minis:cr has announced that defence is one of the issues in the election. Senior Royal Australian Air Force officers are critical of the TFX. They say that the aircraft is not likely to go into service before 1973. Yet the Government has hurried to make a statement on the eve of the election!

Senator McKenna pointed out that in 1957 we were promised immediate action to bring our fighter aircraft up to world standard. The new fighter aircraft are not likely to go into operation until 1967, that is, ten years after the promise of immediate action, lt has been said that the replacement bomber aircraft is not even properly on the drawing board. There is quite a lot of concern in the United States as to its suitability. It is thought that it cannot be put into service until 1973.

I join issue with the Leader of the Government who said that the Leader of the Opposition’s comment on the state.ment was unworthy. With my leader, I welcome the assistance that is being offered to us by the United States of America to fill thc obvious gap in our defence forces. From the limited knowledge that we have of the performance of the replacement aircraft, it appears to be very suitable for long-distance reconnaissance and for Australia’s needs generally. But it is a revolutionary type of aircraft with a virtually, untried type of folding wing Recently the British aviation industry tested a prototype aircraft, as it is wont to do. being a pioneer in the field of aircraft design and construction. The British suffered a great misfortune with this prototype. They had every confidence that it could bc put into operation and that British aviation could continue to lead the way. There is no guarantee that the aircraft that we have been offered will s’and up to all the tests that will be required or that it will even be put into production as quickly as the Government seems to expect. As it is likely to be a considerable number of years before the TFX does become avail-, able, why did not our delegation approach the United Kingdom Government, which throughout the century has been in close co-operation with the Australian Govern-. ment on defence matters? The British TSR-2 promises to fulfil the requirements of the R.A.A.F. and it is already being tried and tested. The Vickers Armstrong organization and the United Kingdom Government agreed to let the R.A.A.F. have this aircraft.

These matters are controversial and could easily have been left for the calmer consideration of thc new year instead of being introduced at this stage of our political history, on the eve of an election. The Leader of the Government could quite well have left unsaid the things that he said of Senator McKenna”. Senator McKenna’s comments were basic and fair. The Minister seemed quite surprised that they should have been made. The announcement has been timed to fit in with the election campaign, and in view of the fact that five or ten years will elapse before these aircraft go into service with the R.A.A.F., this announcement could quite easily have waited until thc new year.

page 1426

CHOWILLA RESERVOIR AGREEMENT BILL 1963

Motion (by Senator Sir William Spooner) - by leave - agreed to -

That leave be given to introduce a bill for an act relating to an agreement between the Commonwealth and the State of New South Wales with respect to the construction of a reservoir at Chowilla.

Bill presented, and read a first time.

Standing Orders suspended.

Second Reading

Senator Sir WILLIAM SPOONER (New South Wales - Vice-President of the

Executive Council and Minister for National Development) [8.40]. -I move -

Thatthe bill be now read a second time.

The purpose of this bill is to obtain the approval of Parliament to an agreement between the Commonwealth and the State of New South Wales for the provision of financial assistance to the State in respect of its share of the cost of construction of the Chowilla reservoir on the river Murray in South Australia.

This bill is complementary to the measure already passed by the Senate to approve amendments to the River Murray Waters Agreement for the principal purpose of providing for construction of the Chowilla reservoir as a work under that agreement, the cost of the project to be shared equally between the Commonwealth and the States of New South Wales, Victoria and South Australia. When introducing that measure I explained at some length the important purposes the Chowilla reservoir will serve, and I shall not go over that ground again here.

During the inter-government discussions that led to the decision for construction of the reservoir as a work under the River Murray Waters Agreement, the Government of New South Wales indicated that, while it fully agreed with the desirability of going ahead with the project as quickly as possible, it was not in a position to provide its one-quarter share of the cost because of the extent of its other water conservation obligations. In view of the great national importance of the project, the Commonwealth offered to provide special loan assistance to New South Wales to enable it to finance its share of the cost. The State accepted the Commonwealth’s offer, and the agreement now before the Senate incorporates the arrangements that have been agreed to between the two Governments for the provision of Commonwealth financial assistance to the State.

Under the agreement the Commonwealth will provide assistance to New South Wales to the extent of the State’s obligations, under the River Murray Waters Agreement, to contribute one- quarter of the cost of the Chowilla project. Commonwealth payments to the State will be made in amounts equalto the amounts the State is required to pay from time to time to the River Murray Commission in respect of its share of the cost of construction of the project.

The State will repay each Commonwealth payment in twenty equal half-yearly instalments commencing ten years from the date the Commonwealth payment to the State is made. Interest, at the long-term bond rate applying when each payment by the Commonwealth is made, will be paid to the Commonwealth by the State, at halfyearly intervals from the time the Commonwealth payment is made, on the outstanding balance of each Commonwealth payment. The repayment and interest provisions are the same as those applying in the case of the agreement between the Commonwealth and New South Wales on the Blowering reservoir.

The agreement also contains a number of machinery provisions of a similar kind to those embodied in other recent Commonwealth/State agreements for the provision of special Commonwealth financial assistance for major developmental projects in the States.

On the basis of the tentative cost estimate of £14,000,000 for the Chowilla project the extent of Commonwealth assistance under the agreement will be £3,500,000. The agreement does not, however, limit the amount of Commonwealth assistance to this figure; the State will be entitled to assistance equal to one-quarter of the actual cost of the project.

In addition to the assistance to be provided to New South Wales under the agreement the Commonwealth will, of course, be providing its own contribution of onequarter of the cost of the project under the provisions of the River Murray Waters Agreement. The Commonwealth willthus be financing, in the first instance, one-half of the cost - a fact which indicates the great national importance attached by the Government to a major project for further conservation of the waters of Australia’s foremost river system. I commend the bill to the Senate.

Debate (on motion by Senator Cavanagh) adjourned.

page 1428

NORFOLK ISLAND BILL 1963

Motion (by Senator Paltridge) - by leave - agreed to -

That leave be given to introduce a bill for an act to amend the Norfolk Island Act 19S7.

Bill presented, and read a first time.

Standing Orders suspended.

Second Reading

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

– I move -

Thai the bill be now read a second time.

The main purpose of this bill is to give effect to changes in the powers of the Norfolk Island Council that have been requested by the council. In 1957, at the request of the residents of Norfolk Island, this Parliament amended the Norfolk Island Act in order to make it possible for a council elected on adult franchise to undertake certain functions similar to those- performed by local governing bodies in Australia. The Norfolk Island Act 1957 provided that there should be a Norfolk Island Council, with a general power to advise the Administrator on any matter affecting the peace, order and good government of the Territory and, in addition, with power to exercise a wide range of functions set out in the second schedule of the act, power to levy rates and impose charges, power to make by-laws and power to carry on a business undertaking.

The Norfolk Island Council as- envisaged in the act was to be constituted by ordinance of the Territory, and was to replace the previously existing advisory council which had functions only of advising the Administrator. The 1957 act was designed to give the people of the Territory a more active part in the conduct of their own affairs. At the time the bill was passed through this Parliament the Government believed it met the wishes pf the island people. f; After the passing of the act, however, it became apparent that there was a reluctance to assume the responsibilities which the act would have placed on the council. Differences of opinion were expressed by island people. Eventually the- Minister for

Territories (Mr. Hasluck), on a visit to the Territory in May, 1959, after discussing these matters with members of the advisory council and at a public meeting of residents, informed the Norfolk Islanders that they were not compelled to accept local government, although the Government hoped that they would make use of the opportunity offered by the Norfolk Island Act, which had been passed at their request.

Following this visit, the advisory council adopted a resolution stating that it wished to see a draft of the proposed Norfolk Island Council Ordinance, under which the new order would be established, and finally, in 1960, the council adopted a resolution approving a draft of this ordinance. The ordinance was made on 7th April, 1960, and on, this date the Norfolk Island Act 1957 also came into operation. Subsequently discussions were held to reach agreement on the financial arrangements to be made and the functions to be transferred to the council.

The first elections for the Norfolk Island Council were held in July, 1960. The form of government of the island was a major issue at the elections. Since then the council has declared its opposition to the constitutional changes envisaged by the 1957 act, and a subsequent election has confirmed in office those who took this view. The council has not exercised its power to carry out any of the functions of local government. Instead, the request has been made for fuller consultation in the administration of the- Territory and particularly for consultation on the raising and expenditure of revenues in the Territory.

During the past two years both the Minister for Territories and the Administrator of the Territory, Major-General Wordsworth, who will be remembered with respect and1 esteem as a former senator, have had discussions with the council on a number of occasions in order to reach arrangements for the government of the Territory which would meet the wishes of the people as expressed by the Council. These discussions resulted earlier this year in agreement on the proposals which are now being incorporated in the bill before Parliament and on consequential proposals to which effect can be given subsequently by ordinances of the Territory. At a meeting of thc council on ( 18th June, 1.963, the following resolution was ‘adopted: -

That Council records its appreciation of the recent visit by thc Minister for Territories. and his efforts to establish a satisfactory form of government for Norfolk Island. Council trusts that Commonwealth Parliament will see fit to approve Council’s recommended amendments to the Norfolk Island Act 1957. Council is convinced that the proposals represent the wish of the people of Norfolk Island and will result in an economic smooth-running administration.

This bill contains the recommended amendments. The principal amendments proposed by the bill are contained in clauses

I and 8. It is proposed to omit certain provisions of section 1 1 of the principal . act relating, to the powers and functions of the council, and to provide that the council shall be constituted as by ordinance and shall have such powers and functions as are conferred on it by this act. Clause 8 repeats the present provision in sub-section

I I (5.) of the act which gives the council the power to advise the Administrator on any matter affecting the peace, order and good government of the Territory. At the request of the council provision is made, in sub-clauses (3.) and (4.), that where the Administrator disagrees with the advice tendered to him by the council he shall, except in cases where he considers urgent action is required, suspend action in relation to that matter and notify the Minister of the advice tendered and of his reasons for disagreeing with that advice. Sub-clause (5.) requires the Administrator, where he has received the directions of the Minister, to act in accordance with those directions.

Section 16 of the act provides for the Minister to refer a copy of every proposed ordinance to the council for its consideration. Clause 9 inserts a new section to provide for a copy of all proposed regulations to be forwarded also to the council. The provisions of the clause for the council to make representations on proposed regulations, consideration by the Minister of these representations, and the making of regulations on the grounds of urgency without first referring a copy of the proposed regulations to the council are identical with the present provisions in section 16 in relation to ordinances. Clause 13 amends section 26 of -the act to provide that only the Minister may make grants on other dispositions of Crown land in the Territory.

Those are the arrangements for which the people of Norfolk Island have asked, and I submit to the Senate that we should respect and give effect to their wishes. The opportunity is also being taken to make other minor amendments.

Clause 10 of the bill amends the provisions of section 17 relating to resolutions of either House of the Parliament disallowing an ordinance, to bring them into conformity with the recent amendment made to section 48 of the Acts Interpretation Act. The present act provides that the Supreme Court of the Territory shall consist of a single judge. Clauses 11 and 12 contain provisions whereby the Governor-General may appoint as judges of the Supreme Court persons who are judges of a federal court. A judge shall be remunerated with the salary, that he receives as a judge of the other court and shall be paid such travelling expenses as the Governor-General determines. Judges will have seniority as judges of thc Supreme Court according to the dates of their commissions, and provisions have been inserted so that the appointment of the present judge should not be disturbed. This amendment will facilitate the work of the court by enabling the judges to act in turn on the Supreme Court bench. Clause 14 repeals section 31 of the act which applies certain provisions of the Crimes Act to proceedings in the Sup. cine Court, and which have been redundant since the last amendment of the Crimes Act.

In order that there will be a person available on the island to carry out thc duties of the Administrator if the Administrator is absent or otherwise unable to act and an acting Administrator has not been appointed, provision is made in clause 5 for the appointment of a Deputy Administrator. Under the present provisions of the act, if it is desired to appoint as Acting Administrator an officer of the Administration of Norfolk Island it is necessary to bring that officer to Australia to take the oath of office and this results in transport difficulties and delays in appointment. Clause 6 provides that the oath of office may be taken before a person appointed by the Governor-General for this purpose.

In addition to the changes proposed by this bill; it is also intended that the Norfolk Island Council Ordinance will be amended to provide that the council will be constituted by the Administrator and eight members elected for a two-year term. At present, the council is comprised of eight elected members, of whom four retire each year. As the council does not wish to carry out any executive actions, the provision incorporating the council will be deleted. Provision will be made for a president of committees of the council elected from the elected councillors with the duties of presiding over committees other than committees of the whole council. Various other amendments dealing with qualifications of electors and the machinery of elections will also be made.

In a new public monies ordinance the council will be given the opportunity to tender advice before the preparation of the annual estimates for the Territory and upon variations in the estimates unless special circumstances make this impracticable. To meet the request of the council it is proposed to provide by ordinance for the holding of referendums in the Territory. In conclusion, I would again emphasize that these changes are being made at the express wish of the Norfolk Island Council which has assured me that it is voicing the wishes of the people. While the council will thus no longer have power to carry out functions of a local government nature, the people, through the expansion of the advisory powers of the council, will have a fuller opportunity to express their views on all matters affecting the government of the Territory.

Debate (on motion of Senator O’Byrne) adjourned.

page 1430

UNIVERSITIES (FINANCIAL ASSISTANCE) BILL 1963

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Sir William Spooner) read a first time.

Second Reading

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

[8.58]. - I move -

That the bill be now read a second time.

The report by the Australian Universities Commission for the six years 1961-66, which I tabled in this chamber earlier this week, and the legislation now before the Senate are stages in the familiar procedure whereby we define the terms of the partnership between the Commonwealth Government on the one hand and the State Governments and State universities on the other. This is, in fact, the third occasion on which we have introduced legislation covering triennial periods of university development. The first was in 1958, following the Murray report of 1957. It covered the years 1958-60. The second was in 1960 when the Universities Commission, established in 1959, made recommendations for the years 1961-1963. The present legislation covers the period 1964-1966 and provides for assistance to the State universities at a higher level than ever before.

The Government is greatly indebted to Sir Leslie Martin, the full-time chairman of the commission, and his six fellow commissioners - Professor N. S. Bayliss, Mr. K. B. Myer, Professor S. Sunderland, Professor A. D. Trendall, Dr. J. Vernon, and Sir Kenneth Wills. They have presented a report which will be of great value to all who are interested in the development of Australia’s universities.

The problems connected with university development and with the national need for greater numbers of highly trained people are such that the commission has a committee actively investigating the future of the whole field of tertiary education. This committee’s report, which should be completed at the end of this year, promises to be of great importance.

Apart from assistance for State universities, which is dealt with in this bill, the commission’s report also makes recommendations for the development of the Australian National University during the years 1964 to 1966. These recommendations are not dealt with in the present legislation as the Australian National University is wholly a Commonwealth responsibility and financial decisions affecting it are reached during the annual debates of the Commonwealth budget. Honorable senators will be interested to know, however, that, in general and subject to normal annual budgetary provision, the Government accepts the recommendations of the commission for the Australian National University during the next three years.

The commission’s report is a detailed one and it will repay close study. I think it would be appropriate for me to draw the attention of honorable senators to some of its main features. Perhaps the first matter demanding our attention is the fact that the commission concludes that the 1964-1966 triennium will be a period of rapidly increasing university enrolments at both undergraduate and post-graduate levels. The evidence available to the commission shows that an increasing proportion of secondary school students are staying on at school for the matriculation year. This fact, combined with the increasing numbers passing through the secondary schools, means big increases in the numbers wanting to go on to universities. The best estimates available to the commission suggest that equivalent full-time enrolments at universities, that is the number of students calculated after certain allowances for parttime and external students have been made, will rise from about 53,000 in 1963 to about 74,000 in 1966. Thus, the universities will be expected to provide for an increase of 40 per cent, in their student numbers over a period of three years.

Inevitably, such increases require comparable increases in staff numbers. The commission .estimates that if the. present staff-student ratio is to be maintained, about 2,000 additional academic staff- will be required. For both staff and students, the rate of increase will bc much greater in the coming triennium than it was between 1960 and 1963. In that period the increase in equivalent full-time students was 11,000 and the increase in equivalent full-time staff was about 1,000. The rate of increase in student numbers is expected to decline somewhat from 1966 onward.

The report contains chapters dealing with research and computing facilities and under both of these headings greatly increased expenditure is recommended. With the great increases in university enrolments in recent years, it has been difficult to keep pace with the demand for residential accommodation for students. Yet it is essential to do so if students whose homes arc far from universities are to be able to take full advantage of expanding university facilities. At present about 14 per cent, of full-time students live in halls of residence or residential colleges affiliated with univer sities. The commission recommends new buildings and extensions which should lift this proportion to over 16 per cent, by the end of 1966.

When we come to look at the commission’s recommendations for the financial needs of the universities, it is inevitable, with the rapidly growing enrolments and the related increases in staff, that we should find big increases in recurrent expenditure. The commission also finds that further capital development is required but a study of the recommendations shows that, if we set aside- the money recommended for residential accommodation, the cost of buildings recommended by the commission for 1964-66 is not much more than the cost of those erected in the present triennium. No change is proposed in the relative shares of the Commonwealth and State governments - that is to say £1 for £1 on the capital side,’ and a Commonwealth contribution of £1 for every £1.85 of State grants plus students’ fees for recurrent expenditure.

Despite all that has been done in recent years and what is in prospect, the universities still have big problems. The commission expects that difficulty will be experienced in recruiting suitable qualified academic staff. Then there is the matter of quotas at Australian universities. This subject has received much publicity this year. It is therefore pleasing to find the commission reporting that except for all faculties of medicine, other than that of Queensland, restrictions on entry have been significant only in the four universities in Sydney and Melbourne. For relief in the medical field, the commission recommends greatly increased medical training facilities at the University of Melbourne and the establishment during the triennium of a faculty of medicine at the University of Tasmania. In addition, of course, the rapidly expanding new medical school at the University of New South Wales will give welcome relief in that State. Having looked carefully at the whole question of quotas, the commission recommends additional grants in the coming triennium beyond those first contemplated so that the University of New South Wales and the Monash University will be able to accept students ‘Who might otherwise have to be excluded.

Despite difficulties flowing from rapid increases in student numbers, the difficulties in recruiting staff, and the disruptions caused by extensive building programmes, the universities have made tremendous strides since the first effects of the Murray report were felt in 1958. An excellent scries of photographs in the report gives a vivid impression of the amount of building that has been accomplished at each of the universities. It is a fact that the universities have been able to admit almost all thc students seeking admission including the enrolment of many students from overseas. In 1962, there were 3,500 overseas students in our universities.

At the same time, academic results have greatly improved. Of those who entered our universities in 1951 about 57 per cent, graduated. Of those who entered in 1956. some . 70 per cent, graduated. This improvement is being maintained. In 1962, there were nearly five times as many higher degree students as there were in 1953, and the universities expect the numbers to double by 1966. This increase is of great national importance, particularly in the fields of research and of university teaching.

The circumstances were such that the commission was unable to present a complete set of financial recommendations for the coming triennium. No recommendation is made for Commonwealth assistance for teaching hospitals. This form of assistance dates only from 1962, and since the completion of the commission’s first investigation of the subject its members have been fully engaged with their inquiries into the general pattern of assistance for the universities. A recommendation with regard to the teaching hospitals will be made to the Government next year.

The level of academic salaries is another matter in relation to which arrangements for the coming triennium have not yet reached finality. In calculating the needs of the universities and the level at which Commonwealth support should be offered, the commission used the same scales of academic salaries as were adopted from December, 1960. This was based on a standard professorial salary of £4,250. I shall be saying more about the salaries question later in this speech.

The commission provides a summary of all its recommendations in Table 5 on page 4 of the commission’s report. In a further condensation of those figures, I ask honorable senators to note the following amounts for 1964-66 and the comparisons with 1961-63: For general recurrent expenditure, £37,700,000 - an increase of about £12,000,000 over the provision in the present triennium. For buildings and furnishings, other than student residences, £15,700,000 - an increase of about £1,000,000. For research and computers, £2,900,000- an increase of £2,400,000. For building and furnishing halls of residence and affiliated colleges, £3,400,000 - an increase of nearly £2,000,000. For recurrent expenditure in the halls of residence and affiliated colleges, £700,000 - an increase of £200,000.

From the figures I have just given it will be clear that acceptance of the commission’s present recommendations would require the Commonwealth to offer to the States over £60,000,000 for their universities during the coming triennium. This is an increase of nearly £16,000,000 over the Commonwealth money provided during thc present triennium. To attract this amount, the total of State grants and students’ fees in all of the State universities would need to be over £90,000,000- an increase of more than £25,000,000 on the corresponding amount for State grants and students’ fees in the present triennium. To complete this brief summary I might mention that the income which universities will derive from students’ fees during the coming triennium has been estimated at nearly £20,000,000.

Subject to certain comparatively minor reservations, the Government has accepted the financial recommendations of the commission and the aim of the present bill is to give legal effect to an order to the States for financial assistance for their universities at much higher levels. The Prime Minister has informed the Premiers of the commission’s financial recommendations and of the Government’s intentions with regard to them. We attach great importance to the place of the State governments in this partnership, as they have a major responsibility for the development of their respective universities. At the same time, I am pleased to be able to tell honorable senators that there is abundant evidence that the

State governments recognize the Australian Universities Commission as an expert body to which they can turn for advice on matters affecting university development.

I have already mentioned that additional provision will need to be made for academic salaries and for teaching hospitals. There is no doubt, either, that the problems with which the commission’s Committee on the Future of Tertiary Education is concerned and the recommendations which the Government will receive as a result are likely to be very significant for the provisions to be made in the future for universities.

The commission has recommended a grant of £5,000,000 on a £1 for £1 basis as between the Commonwealth and the States to support special additional research activities at post-graduate level. It has not, however, completed its study of the distribution of the proposed research fund and recommends, in the first instance, a distribution of £1,000,000 in the proportion shown in Table 60 of the. report.

The Commonwealth is ready to accept the commission’s proposals for the initial £1,000,000 on the understanding that the funds shall not bc used, in substitution, to finance research activity already supported from the general funds of universities or from other sources, and shall not be used in such a way as to compete with the Commonwealth post-graduate awards or similar schemes for assisting post-graduate research students. We have postponed a decision on the balance of the commission’s research proposals until it has completed its study. We would hope shortly to take an opportunity to look at the whole question of Commonwealth involvement in research ?n Australia. Table 68 of the report shows the commission’s proposals for assistance to affiliated colleges and halls of residence. The Government supports the total scale of assistance suggested by the commission. But we wish to ensure that within this total the affiliated residential colleges should have access equally with halls of residence to the Commonwealth grant on a £1 for £1 basis. This is a matter which the Prime Minister will discuss with the commission.

The levels of academic salaries which the Commonwealth will support and the method by which these levels should be established are questions which have received the Government’s close attention. Wc accent the commission’s view that it should not be the salary-fixing body for the universities of Australia.

The Government is aware of measures and proposals for increases which have resulted from a decision earlier this year by the New South Wales Industrial Commission. Even before this, proposals had been put to us that the Government should set up some machinery on an Australia-wide basis to make recommendation on appropriate levels for academic salaries. Though the finance required for salaries is of vital concern to the Commonwealth when making its offers to the States for recurrent expenditure at universities, we recognize also that salaries paid in a State university are, in the last analysis, a matter for that university and its State Government. In the present circumstance, with changes in salaries occurring, but with no scales recommended by the Universities Commission, the Government has decided to make new arrangements to obtain advice concerning the scale of academic salaries which the Australian Universities Commission would be able to use when calculating the recurrent grants for each triennium. Our intention is to appoint a person of suitable qualifications and experience to inquire into academic salaries with the assistance, perhaps, of two assessors who would repre.ent Government and university interests. We would hope, as a result, to have a determination for the 1964-66 triennium which would take effect from 1st January, 1964.

The Prime Minister has informed the Premiers of the Government’s intention to seek this arrangement as a means of providing guidance to the Commonwealth on the level of salaries to which its offer to the States for universities’ recurrent expenditure should be related. When deciding on our plans for an inquiry, we shall take into consideration the views of the States, ft is our hope that the States will give this proposal their full support.

In the meantime, and as an interim measure which we consider necessary because a professional rate of £4,250 per annum is no longer generally accepted, we have decided that we should offer to the States recurrent grants calculated on the basis of a professorial salary of £4,600 per annum. The Premiers have been informed of our willingness, to support increases up to this level in salaries in State universities from 1st July, 1963. The Government has also informed the Australian National University of its willingness to endorse corresponding increases in the scales of academic salaries at that institution. It follows from what I have said above that it will be necessary later to introduce amending legislation to provide the supplementary funds required from the Commonwealth- to support the interim levels indicated and subsequently to support whatever levels for the 1964-66 triennium as are arrived at as a result of the inquiry.

The terms of the present bill are very similar to those of previous legislation offering assistance to the States for their universities. A change, in clause 3 and the related First Schedule, which reflects the firm partnership which now exists between the Commonwealth and the States in providing finance for State universities, is that it is no longer considered necessary to have the rather complicated system of first and second level grants. This device was introduced some twelve years ago when the Commonwealth first made block grants to the States for their universities’ recurrent expenditure and it was designed to ensure a minimum level of State contribution. We agree with the commission that this provision is no longer necessary.

In view of what I have said earlier, it will be clear to honorable senators that the references to salaries in clause 4 are based on the figures used by the commission. It has not been practicable in the time available to recalculate the figures in the first schedule to make allowance for the Government’s decision to support salaries based on a professorial rate of £4,600. Nor, in view of the further arrangements the Government will be making, do we think it worth while to make changes at this stage. In due course, appropriate amending legislation will be introduced.

In clause 5 and the related Second Schedule, which deal with grants for expenditure on university building projects, &c, there is a departure from the 1960 legislation in that there is no separate provision for furniture and equipment. The figure recomended by the commission and accepted by the Government for each building project contains an appropriate allowance for furnishing and equipping that building. Clause 6- and the Third Schedule, which deal with . special post-graduate research activities, are tentative for thc reasons which I have already explained.

Clause 7 and the Fourth Schedule give effect to our decisions concerning finance for halls of residence and affiliated residential colleges. The Fourth Schedule therefore combines the extent of Commonwealth support for both types of institutions at each university. The provision of Commonwealth money within any one university is conditional on approval by the commission for each amount spent and the purpose for which it is spent. As experience has shown that it is difficult to forecast precisely the needs for residential building at any one university, this section provides that the Minister may -make certain variations of the amounts allocated to the various universities.

I have said that the commission’s report is an important one. Similarly, this bill is important, making as it does a most significant increase in the provision of finance for university development in Australia. In giving effect, to its provisions, both the Commonwealth and the State governments will be required to find many more millions of pounds in the next three years. We are convinced that there is a great national need for more graduates. We are aware also that there are many problems’ to be solved not only in the universities but in other areas of tertiary education. We are therefore looking forward to receiving the commission’s recommendations when it has considered the report of its committee into the future of tertiary education in Australia. When we have those recommendations, it will be possible for the Government to develop a co-ordinated plan for many aspects of tertiary education. In the meantime, however, we are sure of the need to continue our support for universities on the scale envisaged in this bill and in the necessary amendments which I have foreshadowed.

Debate (on motion by Senator Cohen) adjourned.

page 1434

STATES GRANTS (UNIVERSITIES) BILL (No. 2) 1963

Bill received from the House of Representatives. . . .

Standing- Orders suspended.

Bill (on motion by Senator Sir William Spooner) read a first time.

Second Reading

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

[9.25]. - I move -

That the bill be now read a second time.

In the present triennium, the Commonwealth provided a total of £1,000,000 for affiliated colleges within the universities and, within this total £150,000 was set aside in the State Grants (Universities) Act for residential colleges within the University of New South Wales. Plans for these colleges have not matured at this stage and, instead of allowing the appropriation to lapse, on the advice of the Commonwealth Universities Commission, we propose, by this amendment, to make these funds available to colleges within other universities, on the usual £1 for £1 matching basis.I commend the bill to the Senate.

Debate (on motion by Senator Cohen) adjourned.

page 1435

CURRENCY BILL 1963

Second Reading

Debate resumed (vide page 1422).

Senator AYLETT:
Tasmania

.- I shall endeavour to continue my remarks from where I left off when the debate was adjourned toenable the Senate to hear the ministerial statement on our token Air Force. Because of the long interval since the Leader of the Opposition (Senator McKenna)- moved his amendment, which I support, I should perhaps repeat it. The amendment to the motion, “ That the bill be now read a second time “, states -

Leave out all words after “ That “, insert “ the Senate, whilst supporting the proposed introduction of decimal currency considers that a decision as to the monetary unit and money denominations should not be made until the people of Australia have had an opportunity, during the forthcoming general election campaign, to make known their opinions and that, accordingly, further consideration of the proposals should be deferred until the meeting of the new Parliament “.

I can see no urgency about this bill and I cannot understand the need to rush it through the Senate. It is a measure which deserves full consideration. A deferment of this bill would not cause the Government any great inconvenience. Perhaps at a later stage we shall be told why the Government has endeavoured to rush the bill through so that it will be disposed of before the election.

The second-reading speech of the Minister for Civil Aviation (Senator Paltridge) contained no less than 33 pages, which honorable senators are supposed to digest and analyse in the course of an hour or so. In the course of that speech he dealt with protection against exploitation and unnecessary price increases. However, the only assurance on that score that we have from the Minister is in these words -

Certainly I can assure you that the Commonwealth Government itself will not be using the introduction of a decimal currency system as an excuse for raising its taxes and charges fractionally. I am sure I can give a similar assurance on behalf of the State governments as well. Some charges may have to be increased slightly by force of circumstances, but there will be offsetting reductions in other related charges.

Surely it is not necessary for a responsible government, whether it be Federal or State, to give an assurance that it will not take a mean advantage of the people of Australia by the use of the fractional differences that will arise from the introduction of the decimal currency system. I should like to have from the Minister an assurance that he will give the community protection against increases of prices by private industry. So far, the Government has given no such assurance.

Government supporters in another place have admitted that price increases will result from the introduction of the new currency. The Leader of the Opposition (Senator McKenna) mentioned that fact during the course of his speech. What has the Minister to say in reply? The Government supporters to whom I have referred claimed that any price increase will not be great, but they admitted that increases will occur. The Leader of the Opposition has claimed that the increases could be substantial if some safeguards are not provided. All that the Government has been able to do to allay the fears of the people in this connexion has been to cite the experience in South Africa. Fancy picking South Africa.’ The Minister said - as I have said, the path has been pioneered for us’ in many ways. Decimal currency was introduced into South Africa in February, 1961.

He went on to say that the increases which had taken place in prices had been very small. Senator Scott has reiterated the remarks of the Minister in this connexion. But fancy picking South Africa as an example. The dogmatic, Hitler-like Government of South Africa has only to say. the word and people will not dare to increase prices. Under its apartheid policy that Government has passed so much antisabotage legislation that it is now easy for it to point the bone at anybody and have anyone arrested on a charge of sabotage. The Australian Government could not have picked a worse example among the countries of the world in attempting to allay the fears of the Australian people. If that is the only evidence that the Minister can produce in support of his case that fact in itself, indicates that the passage of this bill should be deferred in order that it may be thoroughly analysed both by thc Government and the Opposition.

In support of its case, the Government should be able to do better than cite an example such as South Africa, a country which is likely to bc thrown out of the United Nations and which is likely to have sanctions directed against it by countries all over the world because of the measures that it has adopted not only against coloured people but also against its own whites. It is only necessary to read the newspapers in order to learn what is going on in South Africa. That country is not an acceptable example for a democratic country such as ours. The Minister should try to provide other evidence in support of his contention that conversion to decimal currency will not result in price increases.

In this Senate, even among honorable senators who have had many years of experience, there seems to be great confusion on this subject. I rate the Leader of thc Opposition among the top-notchers. As for Senator Scott, who has spoken in support of the measure, I think that the Government would rate him highly. Yet these two senators have different opinions on thc likelihood of price increases. They have different opinions also as to which system of decimal currency would be the more advantageous - the 8s. 4d.-cent system or the lOs.-cent system. Senator McKenna argued in favour of the 8s. 4d.- cent system whilst Senator Scott argued in favour of thc lOs.-cent system. Each of them quoted paragraph 230 of the report of thc Decimal Currency Committee in support of his arguments. If such confusion exists within this chamber, what must be the extent of the confusion among the general public on this subject? Are thc rank and file of honorable senators clear on the subject? Senator Scott did not read paragraph 230 of the report to which I have referred. He asked that it be incorporated in “ Hansard “.

Senator Paltridge:

– He read it.

Senator AYLETT:

– Well, it will pot do any harm to read it again. It reads as follows: -

The outstanding advantage of the 8s. 4(1.-cen 1 system is the exact equivalence of values for all £ s. d. amounts which do not include halfpence. The lOs.-cent system has en exact equivalent for every amount in shillings or ending in sixpence, and has the advantage over the 8s. 4d. unit of providing an easy conversion to pounds and a ready associability of values, as well as retaining the shilling as a decimal denomination.

At one and the same time the committee states that the lOs.-cent system has an advantage over the 8s. 4d.-cent system and that the 8s. 4d.-cent system has an outstanding advantage. It is generally admitted that it would be easier to convert to decimal currency if we were to adopt the 8s. 4d.-cent system. Paragraph 230 concludes -

In economy of figures there is little between these two systems, although since the 10s. unit is slightly higher in value it has the benefit of what difference there is.

This report does not deal with the question pf price increases which could result from the introduction of the lOs.-cent system. Those increases have been well illustrated by the Leader of the Opposition. Some honorable senators can speak from experience on this subject. Speaking of foodstuffs, the Minister said -

The all-important food sector - is now an intensively competitive one with the advent of chain stores and supermarkets, and there is little likelihood of any but isolated profiteering.

How little the Minister knows about selfservice stores and supermarkets. If he wants to find out about them let him go into a small self-service store and price its goods and then go into a big self-service store where he will find that the prices are some pence higher than those in the small self-service stores. I speak from practical experience in this line. If I were a selfish individual I would sit down and say .no more. I have had two years’ experience in the self-service grocery business. I have also had experience, and I am still getting experience in the financial side of business. The lOs.-cent system would be the simplest for the average person to apply, but with it increases in price could occur and it is my candid opinion that they will occur. There is no provision in the bill, and no provision is contemplated by the Government, to protect the consuming public, of whom advantage will be taken. The 8s. 4d.-cent system could be applied on the basis of current prices.

Let us consider the case of a daily newspaper, now priced at 5d. What do honorable senators think will be the price of that newspaper when we change to the lOs.-cent system? I have not any doubt that the price will be 5 cents, which will be the equivalent to 6d. Under the 8s. 4d.-cent system the price of the newspaper would bc 5 cents, but this would be equivalent to 5d. The conversion of the present price of 5d. to 5 cents under the lOs.-cent system will take millions of pounds out of the pockets of the general public. Does any honorable senator think that newspaper companies will reduce the price from 5d’. to 4 cents? There is no protection against price increases which Government supporters themselves admit will result. I speak in the interests of the general public and not as a selfish individual. I admit that there are advantages in the lOs.-cent system provided the people are protected from wholesale rises in prices in the changeover. In the absence of that protection, the Labour Party’s case in opposition to the proposal is unanswerable. The matter needs far more consideration than it has been given. I have no doubt that there will be wholesale increases in price, because 1 know how simple this will be.

Any one who believes that chain stores provide protection has another think coming. If the chain stores continue to monopolize retail trading, in a few years they will have no competitors. All retailing will bc conducted by about four monopolies. Then we will really know what high prices arc. Thc Minister pins much faith on the chain stores, but if they continue on their present course every small store will be out of business and the chain stores will charge whatever prices they choose.

Senator McClelland:

– They will set thc price to the producer.

Senator AYLETT:
TASMANIA · ALP

– They will set the price to the producer and they will set their own profits. Let no one suggest that chain stores are a protection for the general public. They are working with only one end in view. The small storekeeper whose finances allow him to operate only from day to day or from week to week, must go out of business. He has not a hope in the world of remaining. The small storekeeper who has money behind him can survive only until the monopoly grows larger. Then he will take the price that is offered to him and he will get out. Everybody will then be at the mercy of three or four combines. When they put their heads together we will know how high prices can go. Real difficulties will face whatever government is in office. I throw out this warning because I happen to know this line of business.

The Minister dealt with the conversion of monetary machines. Let me take up the cudgels for another section of the community. There is not one section of the community and there is not one individual that this legislation will not affect in one way or another. It is necessary legislation, subject to the existence of safeguards. The Minister stated -

The Government therefore decided that it would accept the principle of paying reasonable compensation to owners of a large proportion of those monetary machines which will require conversion in order to be used under the new decimal system.

Hie Government’s decision on compensation was one of broad principle, and the first duty of the Decimal Currency Board will be to make a precise recommendation to the Government on which categories of monetary machines might receive full, or nearly full, Government compensation for conversion costs, which categories might be entitled to partial compensation, and which categories might be outside the Government’s field of responsibility.

The Government has not any plan. The Treasurer must wait for a report from the board that will be established to help him with the big problems that will confront him. The Minister went on to refer to the various types of monetary machines.

The agc of these machines ranges from one or two days to 50 years. Some of- them are adequate under the present currency system and would do their work efficiently for many years to come, but because of their agc they cannot be converted.

The Minister has referred to categories which may be outside the Government’s sphere of responsibility. If the Minister was not referring to some of these old machines, what was he referring to? Some of them are doing an adequate job for small storekeepers who cannot afford £300 for a new machine. Are the owners to be compensated for machines that cannot be converted? The Minister has been silent on questions like this. Why is the Government so anxious to rush this legislation through before the general public have had an opportunity to learn what is involved?

We have seen the public resentment that was aroused when it was announced that the basic unit of the new currency would be called the royal. How “do we know that there will not be great public resentment over the old machines which are working satisfactorily under the present system but arc too obsolete to be converted to the decimal currency? Are these machines in a category outside the Government’s field of responsibility? Will the Government slate whether small storekeepers who have such machines are to be compensated if they have to pay out £300 or more for a new machine or a cash register? None of this information is to be found in the Minister’s second-reading speech and the Opposition is justified in moving that the bill bc deferred until after the elections for the House of Representatives. Let us give the people an opportunity to study its provisions. Is the Minister afraid that if the people learn the details of this bill there will be a barrage of protest as there was against the royal? We can only assume that the Government is afraid of the public’s reaction. If it is not afraid, why not defer the bill? Does the Government fear that outside interests, perhaps the various makers of accounting machines, will prevent the bill being proceeded with? The Government has nothing to lose and everything to gain by deferring it.

The Government that is returned to office after the forthcoming elections will want to see the new currency system working smoothly. Tt will want the people to be satisfied with the new system and (here will be everything to gain by ironing out all the difficulties before the bill becomes law. We do not want a half-baked currency system. Once the bill is passed, there is nothing to be done about it. No matter what happens there will be confusion, but why pile confusion on confusion? Honorable senators are confused over one clause which has been cited by both sides in support of opposing cases.

If I were in business and looked at this legislation from a selfish point of view I would say there was nothing wrong wilh it, but the consumers, who have not had an opportunity to analyse the bill, would not be in such a hurry as the Government is. They would want to analyse the bill first. The Opposition’s fears are for the general public. I believe that business people would favour the Government’s proposals, but the consumers, if consulted, would bc 100 to one in favour of the 8s. 4d.-cent ^system before the lOs.-cent system. That is the view of the Opposition because we know - and it has been admitted on the Government side - that there will bc increases in prices under the lOs.-cent sys’em. I repeat that the Government has nothing to lose by deferring the bill until after the forthcoming elections so that tho people will have an opportunity to become informed on the provisions of the bill.

Senator KENNELLY:
Victoria

.- I join other honorable senators on this side of the chamber in requesting the Government to postpone this legislation. I admit that it was necessary for legislation to be introduced to give effect to the proposals announced in the Budget, but now that an election is to be held shortly there seems to be a great rush on the part of the Government to introduce bills. I cannot understand the necessity at this time to introduce the bill now before the Senate, and I do not think that any one else can understand it, cither. Surely no great hardship would be imposed if the introduction of decimal currency were to be postponed for a year. We have had our present currency system ever since the first settlement. There is no need for haste.

It is true that the introduction of decimal currency . was mentioned by the Prime

Minister (Sir. Robert Menzies) in the policy speech of 1958 and. that a committee was appointed in the following year and presented its findings in 1960. But how many people outside the Parliament took an interest in this question until the Government announced that it was proposed to call the basic unit of decimal currency the royal? As we know, there was a barrage of criticism of the name “royal”. Even the Government’s friends took it to task. I believe that prior to the stupid choice of that name the ordinary people had not considered a change in our system of currency. Since then, the people have been aware that the Government has bowed to the popular clamour, particularly that of its friends of the press. It has been announced that the new basic unit will be the dollar. Does it matter much to the mass of the people which system of currency we adopt? I suggest that all they are concerned about is how much of the currency they can obtain and what it will purchase. The world is turning towards decimal currency, but we are still to have our weights in hundredweights, quarters and pounds and our measurements in feet and inches. It is true that in some sections of the community, such as the flour industry, the short ton is used.

The second-reading speech of the Minister for Civil Aviation (Senator Paltridge) contains some remarkable passages. For instance, he said, in effect, “Think what decimal currency will do for the child at school and how easy it will make his life “. I do not think any one would say that the Minister is not competent, but I would not like him to ask me how much I remember of the arithmetic I learnt at school, or was supposed to learn. With decimal currency, we shall have to add two columns, in dollars and cents. To-day, we add three columns, in pounds, shillings and pence. I want to know, and so do the people outside the Parliament: What are the great advantages of decimal currency? I wonder who is to receive the big benefit from its introduction. I do not say that I am opposed to the introduction of decimal currency, but I would like to see the metric system of weights and measures introduced at the same time. Why not let us, and also the people outside, think about the whole question? It would be interesting to know how many copies of the report of the Decimal Currency Committee were printed and how many copies were read by the ordinary people in the community. The. introduction of decimal currency will affect the living standards of the ordinary people. In my view, anything that affects living standards should be placed before the people in simple language so that they may consider it for themselves. The subject will be raised during the forthcoming election campaign. Is the introduction of decimal currency so vital that this legislation must be passed now? If the legislation were Held over for a month or two, would the introduction of the new currency by the desired date be affected? I do not think it would.

Why should we hasten to pass this legislation? Is it because the Government is afraid that instead of a lOs.-cent system being adopted an 8s. 4d.-cent system will be introduced? The Minister for Civil Aviation said that, if an 8s. 4d.-cent system were adopted the necessary coins could not be minted in time to introduce the system by the desired date. Is it vital that decimal currency should be introduced in 1966? Would our position in world affairs be affected very greatly if we could not mint the coins before 1967? We have not done too badly up to date. The real difficulty experienced by the mass of the people is that they have not enough of the present currency. The Minister’s second-reading speech seems to imply that the introduction of the new system is urgent and that the lives of the people will be affected if it is not implemented soon. I want to know how the people will be affected. I believe that the lOs.-cent system will adversely affect the people.

Senator Marriott:

– It does not make sense to you.

Senator KENNELLY:

– You just keep quiet and I will get on a lot better. I do not mind sensible interjections; in fact, as a rule I like them. It is getting near the end of the session, s». let us depart in a friendly atmosphere. We will do so if you keep quiet.

For the Minister to read a speech which covered 33 pages of typescript and to expect us a few hours later to give the legislation the mature consideration that it deserves is to make a farce of this House.

If we were dealing wilh a vital proposal that was mentioned in the Budget, such as the superphosphate bounty which the Government hopes will win it a few votes, the Government would be entitled to expect the legislation to be passed now. But there is no urgency about the introduction of decimal currency.

Senator Marriott:

– Were you forced to debate the bill? Could you not have moved that the debate be adjourned?

Senator KENNELLY:

– The bill is now before us for consideration, and even if the time available for studying the measure has been limited one is entitled to express his viewpoint if he so desires. If the honorable senator wants to advance a certain viewpoint, nobody will prevent him from doing so. I like this passage in the Minister’s second-reading speech -

The controversy over the name of the new unit is familiar, to you ali, and I do not propose to go over all the ground again.

How beautiful that statement is! How nice! I wonder who drafted that statement.

Senator Henty:

– I thought they were your words.

Senator KENNELLY:

– No. I was reading that passage in the Minister’s second-reading speech in a very nice way. I do not want to get into the state of mind that the Leader of the Government in this place was in about an hour ago. I nearly burst out crying then! The Minister continued -

Suffice to say that the Government originally decided to use the name royal . . .

Later in his speech the Minister said -

Now I come to the 8s. 4d.-cent system. Suddenly, out of the blue,’ the Opposition came down recently in favour of this system - more than three years after the Australian Decimal Currency Committee unanimously made its recommendations to the Treasurer, and six months after the Government’s decision to introduce a 10s. system had been announced.

Was there anything wrong about the Opposition’s using the forms of the House - honorable senators opposite will soon have an opportunity to use those forms - to place before the people of Australia its point of view, particularly in regard to prices? The Opposition offers no apologies for what it did. We thought that by proposing a formal motion for the adjournment of the Senate we would have an opportunity to let the Government and the people outside know our point of view. As 1 indicated earlier, we shall express our viewpoint during the forthcoming election campaign, too. We thought that, as the Government believed that a 10s. system would be best and as we favoured an 8s. 4d.-cent system, the Government would not introduce this legislation just now but would let the people outside decide what system should be adopted. But the Government thought otherwise and it has introduced legislation to permit thc implementation of the 10s. system.

The Minister for Civil Aviation also said, in his second-reading speech -

The 8s. 4d.-cent system, while attractive at first sight, has three main disadvantages when compared with a 10s. system. First, it would provide a very awkward conversion between the £1 and the dollar during the transitional period, and could be a source of annoyance for many years to come.

What would be wrong with having thc two currencies working together for one or two years? Would it be a hardship for stores to have to put up their prices in both currencies? It would not be a great hardship.

Senator Wright:

– You mean “ display “ the prices?

Senator KENNELLY:

– Yes. During the transitional period, whether it bc one year or two years, thc stores could display the two prices. If that were done this would not be one of the main disadvantages. The Minister’s second-reading speech continues -

Firstly, it would provide a very awkward conversion between the £1 and the dollar during the transitional period, and could be a source of annoyance for many years to come. For example, £14 would become $33.60, a conversion which would not come easily or quickly to the average Australian.

I know that we are dumb, but do not tell us in a prepared speech in this Parliament that we are so dumb as all that. Two million people have come to this country since the end of the war, at any rate since about 1948 or 1949. I think about 16,000 arrived in 1947. These 2,000,000 people came from different countries, the vast majority of which have currency systems different from ours. I have not heard of many, when they commenced to work, who did not find out quickly what their money was worth in our currency and what our money was worth in their currency. If that is the second main disadvantage of the 8s. 4d.cent system, I do not think it has any foundation. I think that what the Government is doing is putting up an Aunt Sally and then knocking it over. If anybody had prepared a speech like this for me I would have told him to take it away and bring back a speech that I could read with some self-respect. It is ridiculous to say that Australians are so dumb that they do not know whether they are getting value for their money or not.

The Minister went on -

Secondly, although any amount of pounds, shillings and pence could be converted exactly into the new currency by the simple expedient of converting it into pence and providing a decimal point, the actual conversion is far from easy for all but small amounts.

Again I say that I do not mind knowing that 1 am dumb, but I do not like being told it, and I do not like the people of Australia having to swallow this rubbish. Listen to this gem. The Minister continued - it would require some strenuous mental arithmetic to convert 17s. 6d., or 210 pence, into $2.10; or 59s. Hd., or 719 pence, into $7.19.

If that is not telling the people of Australia that they are dumb, I do not know what it is. It may be true that some people could not work out such a calculation within a minute or two, but if the Government wants this system to work - and I think it does - the easiest way would be for the storekeepers to put up the price in the present currency and also in decimal currency, [f that were done it would take away the strenuous mental exercise to which the Minister referred. Is not this absolute rubbish! We come to the third disadvantage -

A third and very important disadvantage of the 8s. 4d. system is that the penny would be the only existing coin denomination which could be retained under the new system, and we have in any case already decided to replace the penny by a smaller coin.

That is true, but is there any need that this system be introduced on the date that has been laid down? No case -has been submitted to show that the people of Australia want to rush into this change-over. We can mint the coins we need. I understand the Government is building a new mint here in Canberra. It has one in Melbourne, the city in which I reside. Some of our coins have been minted outside of Australia in the past. Is there anything wrong in continuing to have them minted outside of Australia?

The Government must take us for the dumbest lot of creatures one could ever dream of. As I have said several times, I do not mind being stupid, but I hate being told, as we are being told in this secondreading speech, how stupid we are.

Senator McKenna:

– How stupid they think we are.

Senator KENNELLY:

– Yes, how stupid they think we are. The Minister went on -

Coins equivalent to the existing 3d. and above, that is 3 cents, 6 cents, 12 cents and 24 cents, would have no place in a decimal currency system.

That is true; we are to have a new system. Anyhow, I understand that it is uneconomic to mint bur present Id., ls. and 2s. coins. The price of silver is such that minting of the last two is uneconomic. I do not like even this Government doing uneconomic things. Does it matter whether the coins are minted in silver, copper, bronze or nickel? The only thing that matters to me is how many of them I have, and how much they will buy, and that is all that matters to the people of Australia.

I have marked another passage in the Ministers’ speech. It is suggested that if we had an 8s. 4d.-cent system it would cause confusion for the banks. The Decimal Currency Committee report suggests that also. One of the contentions of the committee is that such a system would affect statistics and banks. I do not know whether or not the committee mentioned the Government’s other friends, the insurance companies. I have no wish for these people to be adversely affected. This suggestion of the committee is to be found on page 34 of the report. Conceding that everything in the report is true, the subject of inconvenience is dealt with only once.

Debate interrupted.

page 1441

ADJOURNMENT

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

That the Senate do now adjourn.

Question resolved in the negative.

page 1442

CURRENCY BILL 1963

Second Reading

Debate resumed.

Senator KENNELLY:

– In the report of the Decimal Currency Committee there appears only one reference to the inconvenience that will be caused. However, what worries me is the number of times that the people will suffer because of the introduction of the lOs.-cent system. I refer again to the second-reading speech and cite an important part of it. The Minister said -

As I have said, no system is perfect. . . .

The only coinage system that the Minister and I would agree was perfect is one under which we both had a lot. The Minister continued - . . and one disadvantage of the 10s.’ system is that the cent has no exact equivalent in pence and that there must, therefore, bc some adjustments in prices and other amounts which are not exact multiples of 6d. which will of course be equivalent ; to 5 cents. It has been argued that traders .. wilt tend to price their goods at the same number of cents as they are at present charging iri pence, that is, that everything costing Id. will become one cent, or 1.2d., and everything now costing 6d. will become 6 cents., or 7.2d., and so on. Therefore, it is argued, there will be a tendency, for prices of items entering into the normal household budget to increase by up to 20 per cent. However, while it is true that there will inevitably be some upwards adjustments to individual prices, it is equally true that there will be many downward adjustments. For example, the popular custom of pricing to ltd. will no doubt be replaced by pricing to 9 cents., which represents a small reduction.

Does the Minister really believe that that will happen?

Senator Paltridge:

– Yes.

Senator KENNELLY:

– The Minister should get his feet on the ground and not be so airy-fairy. I say that wilh great respect because the Minister and I are good friends, despite our different political beliefs. I suggest that the Minister knows that that will not happen.

Senator Prowse:

– Of course it will.

Senator KENNELLY:

– Does thc honorable senator believe that an article which a retailer now sells for 3d., he will sell for 2 cents, which is the equivalent of 2.4d., rather than 3 cents, which is the equivalent of 3.6d.? I invite the honorable senator to ask himself that question.

Senator Scott:

– That is what happened in South Africa.

Senator KENNELLY:

– It did not.

Decimal currency was introduced there at a time when people were being shot at Sharpeville and the whole economy of the country was upside down. What 1 suggest will happen is already happening with respect to charges for telephone calls. One reason stated by the Government for increasing the local call fee from 4d. to 6d. is that this will enable the same equipment to be used when the new currency is introduced.

Is it suggested that the small shopkeeper who is fighting the chain store will reduce his prices? What happened to prices when the 121 per cent, sales tax on foodstuffs was removed? There was no reduction in prices, even on ice cream for the kiddies. However, this is not because of any action taken by the retailer; the wholesaler has increased his prices. 1 do not care how much honorable senators opposite fool themselves - I cannot prevent that - but they should not attempt to fool the ordinary man in the street by saying that the person who is selling an article for 4d. to-day will, with thc introduction of the new currency, reduce the price to 3 cents, which is the equivalent of 3.6d. Surely the new price will be 4 cents. That is only commonsense. Honorable senators opposite should forget about economics and just think of what the average person will do.

Honorable senators on this side of the chamber have asked the Government to postpone consideration of this measure for a couple of months. The Government would lose nothing by doing so, and we would bc able to fight the question at the polls. The people would then have an opportunity to decide what they want. After all, they are the ones who will suffer from the introduction of the scheme proposed by the Government. It is just not commonsense to say that a person who is selling an article for 4d. or 5d. will reduce his price and charge only 3 cents or 4 cents. If the Government’s proposal comes into force it will enable one person whom I have in mind to make an added profit of £1,000 a day. I am prepared to tell the Minister in confidence who that person is.

Senator Branson:

– Is it a newspaper?

Senator KENNELLY:

– The honorable senator suggests that it is. a newspaper. I am prepared to tell the Minister whom I have in mind. Senator Branson thinks I am referring to a newspaper, but I have not said that.

Senator Branson:

– I. did not say that. I asked you whether it is a newspaper.

Senator KENNELLY:

– If the honorable senator wants to suggest that the newspapers will make an increased profit of £1,000 a day from this proposal then he may do so. I have not said that. I do not think it would be right to use the report of the Decimal Currency Committee to make that suggestion about anybody. However, if the honorable senator chooses to say that the newspapers will benefit to that extent 1 shall leave it to him.

Senator Hannaford:

– You arc not usually so guarded.

Senator KENNELLY:

– I must be a very transparent person because Senator Hannaford seems to know what is in my mind.

Senator Branson:

– You said it when speaking on the adjournment motion.

Senator KENNELLY:

– Then produce what I said.

Senator Branson:

– It is in “ Hansard “.

Senator KENNELLY:

– The n produce the “Hansard”. If that is what I said it was what I believed to be true. When I look at the names of the members of the Decimal Currency Committee I see that some very fine people were included. One was Sir Kenneth Coles who, I suppose, would be one of the directors of Coles chain stores. 1 do not know the lady member. I know Mr. Henderson, who was secretary of a union but has now retired. I knew also the late Mr. Vine. I do not suggest that those people supported a report that they did not believe in, but surely we are permitted to say that we do not believe that what they recommended is in the best interests of the people. I shall now revert to that missile of 33 pages delivered by the Minister a short while ago.

Senator Scott:

– Do you reckon there arc votes in this?

Senator KENNELLY:

– You are more concerned about getting the second position in your party group on the ballot-paper than you arc about votes. Do not worry over votes. I think it may be possible to obtain some odds about this matter. I know it would be wrong to offer them in this chamber. On a previous occasion one honorable senator was offering odds, but I have not heard him offer any since. He is pretty quiet at the moment. I do no! want to treat the matter before the Senate with levity. I believe that it is one of the most important matters that has come before the Senate because it will affect the lives of the great mass of the people.

Senator Kendall:

– They do not understand.

Senator KENNELLY:

– When Senator Aylett was speaking I think I heard Senator Kendall interject that he would not care if all the stores went bankrupt. Now he says that the people do not understand the decimal currency proposal. We should, at least, give them a chance to understand it.

Senator Kendall:

– Do you understand it? 1 do not.

Senator KENNELLY:

– I cannot help it if you do not understand it. I think I understand it insofar as it will affect me. I am one of the common people. 1 am putting their case. I believe it is true that they have taken these proposals for granted. I have never known anything that has been sold so adroitly to the people of this nation as this proposal has been. I think it has been a very clever sale. It has been sold so cleverly that the people want to agree to it. I believe that in these circumstances there is always a little nigger in the woodpile, and I like to have a look at him.

The Minister said that compensation would bc paid to people who had to convert machine’s to the calculation of decimal currency. Who will gain financially by this change-over? Who will get something out of it? I do not think that the people who use machines should bear the whole cost of conversion. My recommendation would be that these people should pay the cost of converting their machines but that they could claim the expenditure as a deduction for income tax purposes. Then, both they’ and the nation would bear a proportion of. the expense. I do not mind the nation being . a Father Christmas to a lot of people, but let it not be a Father Christmas all the time. I know that, as the Minister said, compensation was paid in South Africa. But the South African Government has done a lot of other things which I would not approve. Who will gain from the proposal to pay compensation? The proposal would not have been made if somebody were not going to gain from it. I do not imply that only particular individuals will gain but I suggest that some section of the Community will gain. Will it be people who own machines which will have to be altered? If so, let them bear a proportion of the cost.

Senator Hannaford:

– Will the nation not gain in efficiency?

Senator KENNELLY:

– How much efficiency will result from this proposal? I suggest that more efficiency would be gained if we were to adopt the decimal system of weights and measures as well as the decimal system of currency. Like Senator Hannaford, I had a trip overseas once. In fact, I have had two trips.

Senator Hannaford:

– You are much luckier than I am.

Senator KENNELLY:

– I do not know. I am due for a trip now because I have not had one for eleven years. I am running a bad second but everything comes to those who wait. I suppose that every honorable senator has been outside this country for one reason or another. Whenever they have travelled they have been able to change their money without difficulty. I think that our weights and -measures should be converted to the decimal system at the same time as our currency is converted instead of doing the job in a piecemeal way.

Senator Hannaford:

– But currency is the more important.

Senator KENNELLY:

– I am not arguing about that. But do not suggest that one of the reasons in favour of decimal currency is that it will make the curricula of the schools easier.

Senator Hannaford:

– It certainly will.

Senator KENNELLY:

– That may be so to the extent that only two columns will, bc required to add up dollars and cents instead of three columns for pounds, shillings and pence. I do not contend that that will maks no difference, but it is not a great advantage.

Senator Branson:

– The educationists say that decimal currency will be better.

Senator KENNELLY:

– They do. But I think that our weights and measures should be converted to the decimal system, too. I am not opposed to the introduction of decimal currency, but I am opposed to its introduction with undue haste. There is no need for a decision to be made on a controversial matter such as this just before a general election. No harm would be done if consideration of the matter were postponed for a couple of months. I hope that the Minister will see the position in that light. If he does not, he can rest assured that the case in favour of the 8s. 4d.-cent system will be put to the people. It will be explained to the people that if normal practice is followed upon conversion to decimal currency, items which previously cost 3d. will cost 3 cents. There is no hope of prices being fixed in decimal currency which will be lower than existing prices. The Minister for Civil Aviation is in favour of competition in another sphere, admittedly on an unfair basis.

Senator Paltridge:

– No.

Senator KENNELLY:

– Yes you are. There is keen competition to-day, even between chain stores, irrespective of what one is buying, but I believe that under the proposed decimal system there will be no possible chance of a reduction in prices. I honestly believe that there will be an upsurge of prices. The Minister for Labour and National Service (Mr. McMahon) said, in effect, that if there were an increase in prices, the Arbitration Commission would take this into account in fixing wages. But as Senator McKenna said, the workers do not get to the commission as often as they used to. The basic wage is considered only once a year. Does that mean that there will be a lag of twelve months in compensating the workers for price increases? There always used to be a lag of three months, whether there was an adjustment upwards or downwards. If the assumption of the Minister in another place is correct, the mass of the people will have to wait twelve months for an adjustment, and let us remember that increases are not made retrospective. 1 ask the Government to give the matter more thought. I do not expect this to be done but I am prepared to say that on the issue of the 8s. 4d.-cent system, if not on other issues, we will have the support of the mass of the people.

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

.’ - This debate has served one quite unexpected purpose. It has isolated or identified one of the election issues, because I am bound to tell my friend, the Deputy Leader of the Opposition, at once that the Government does not propose to accept the amendment which has been submitted by Senator McKenna. I was a little surprised at one aspect of the Deputy Leader’s speech, because the proposed amendment reads -

The Senate while supporting the proposed introduction of decimal currency considers . . .

Senator Kennelly seemed to throw substantial doubt on whether he himself accepted the concept of decimal currency. He criticized that part of my speech which dealt not with any particular monetary system but with the general principle of decimal currency. He referred particularly to those sections of the speech which dealt with the advantages that would accrue in education. This was surprising. I thought we had common belief, that . whatever the unit was to be, decimal currency as such did have advantages and that one of the great advantages was to be found in education and in time saved. . If this is not so, some of the leading educationists, not only in Australia but throughout the world, are completely wrong. One of the prime submissions in respect of decimal currency has always been that it provides a simple way’ of teaching mathematics to children and that time will be saved in commerce and in all forms of business. But apparently that view is not held by my friend.

Senator Kennelly:

– You put up Aunt Sallys and knock them over.

Senator PALTRIDGE:

– Not at all. That is what the honorable senator said. He surprised me very much. It has been said that a political opposition has the right at any time to express a view on any subject of public importance. Of course, it has. No one on this side would resist any claim that the Labour Party or any other party might have to putting a point of view. But, acknowledging that right, is it not strange that an issue like this, which has been before the public for so long did not attract one syllable of comment from the Labour Party for over three years?

We are told to-night that we are rushing (his measure through, that there has not been sufficient time to study the proposition. In 1958 we announced our intention of inquiring into the adoption of decimal currency. In 1959 the committee was appointed. It sat for eighteen months; it moved around Australia, and despite what may now bc said about failure to attract public attention, my clear recollection of the activities of the committee is that its proceedings were well covered by the press and by public comment. The amount of interest evinced in this inquiry is borne out completely by the list of witnesses at the back of the report. They represented all phases of national life and were drawn from many geographical locations. The committee itself was represenative of the people to an extent that is not always seen in a committee of this sort. Not only were business and banking interests represented but also the committee included a Director of Posts and Telegraphs. It included also Mr. Henderson, a former federal president of the ‘Electrical Trades Union, for more than 30 years secretary of the Victorian branch of the union, and a member of the State Electricity Commission of Victoria. It included also Alderman Dorothy Edwards, O.B.E., B.A., a well known Tasmanian lady who has been twice mayor of Launceston and is a past president of the Australian National Council of Women. It has been suggested by the Opposition that the system which has been recommended lends itself to exploitation of the public. The two people I have mentioned would be particularly interested in recommending a system which would permit only to the minimum extent any exploitation by ruthless people who were so disposed.

It is of interest that the report submitted to the Government was unanimous. There was no dissentient voice on the committee. This unanimous report was submitted in 1960 - three years ago. The actual system recommended - the unit that should be used - was the unit that was chosen after an exhaustive examination by a South African committee. Subsequently it was also selected unanimously by a New Zealand committee.

But of even greater interest was the decision’ in the United Kingdom of the committee under the chairmanship of Lord Halsbury. After sitting for a long time that committee recommended, by a majority of four to two, the adoption of the £l-cent system and not the lOs.-cent system. In that bastion of sterling currency and of the £1, with its long tradition of importance in the field of international finance, there could be found two men out of a committee of six to say that they believed the lOs.-cent system was the best. This is very important to remember for the simple reason that the Leader of the Opposition (Senator McKenna) chose to take parts of our committee’s report and say, in effect, “ See the thin line which exists between the one hundred penny system and the lOs.-cent system “. I suggest that if this matter is argued in that way we are not going to reach a very honest or objective conclusion, because despite what was said in the Decimal Currency Committee’s report- and it is to the credit of the committee that it said a lot about every system it examined, mentioning in each case the advantages and disadvantages - it is important to remember that having said all those things and examined all the advantages and disadvantages, the committee unanimously favoured the lOs.-cent system. I believe that to be a very persuasive point indeed.

What is of relevance to this discussion is the fact that in my second-reading speech I mentioned that a week or two ago - after three years - the Australian Labour Party declared itself in favour of the 100 penny system. This is relevant because, since we announced acceptance of the recommendation of the committee that the major unit should be 10s., there has been no clamour of any size at all about acceptance of that recommendation. If there were substantial doubts about the decision, one could reasonably expect that some organization would pursue a campaign against it; but in point of fact no such campaign has been launched.

The case of the Opposition, as I understand it, rests almost entirely on the proposal that this currency system would cause a rise in prices. Each speaker on the Opposition side was at pains to give some cases, however isolated, in which it might reasonably be expected that price increases would occur. But the exposition of a comparatively few isolated cases over the whole field of individual sales does not prove anything. It is acknowledged that there will be adjustments. But the fact that there will be some adjustments does not make a case that there will be an all-round increase in the cost of living.

With due respect to Senator Aylett, whom I do not want to ruffle at this time of night, the South African experience is relevant indeed. As Senator Scott said earlier in the debate, the South African experience has shown that a price increase did occur in one aspect of household purchases but a price decrease occurred in another. He went on to show - as I mentioned myself earlier in the debate - that the overall rise in the cost of living, which was pretty well the same over the two years in question as in the two years prior to that, could not be attributed to the adoption of a lOs.-cent. decimal system.

Since the report of the Decimal Currency Committee has been referred to, as well it might be, I want to make some references to it myself. I think it is a document which is well worth the study of anyone interested in this matter. After canvassing five separate systems that might have been adopted for the Australian, decimal currency, and having nominated one, the committee set down in a series of pages, beginning at page 38 of its report, considerations favouring the lOs.-cent system. That was a singular omission from the contributions to the debate by those who oppose the lOs.-cent system. Not one of them referred to that part of the report.

The section of the report which I have just mentioned refers to the effect on the price structure, indicating that the committee was exercised to see that the system it had recommended was not one which would lead to ready exploitation of the buying public. A number of matters of particular relevance are mentioned in this part of the report. I want to read some of the paragraphs because they are germane to the criticism which has been made of the recommendation that the LOs.-cent system should be adopted. Paragraph 187 states -

Slight adjustments would be required in prices which did not end in threepence, or any multiple of threepence, if either the 10s.-cent system with a half-cent, or the £-cent system wilh a quartercent were adopted. Larger adjustments would, be required under the 8s. 4decent and 10s. cent systems without a half-cent, and the £-cent system with a half-cent only, while the adjustments required would be at a maximum under the £-cent system with no fractional coins. It should be noted that the price adjustments necessary would be less under the lOs.-cent system wilh a halfcent than under the 8s. 4d.-cent system without a half-cent.

That is particularly relevant, because the halfpenny will remain in circulation during the transitional period, which will last perhaps until the end of 1967, During that period all traders, who will still be pricing in pounds, shillings and pence, will of course be able to express prices in halfpennies if they wish. There will be nothing to prevent traders who are pricing in dollars and cents from stating prices in half-cents. Such traders could accept halfpennies in payment for half-cent amounts, or give halfpennies as part of the change. If, at the end of the transitional period in 1967, during which time we would have the halfpenny, there should be a strong desire on the part of the general public to keep the halfpenny in circulation for a further period, the Government would no doubt give careful consideration to that possibility; but the present view is that traders and the public generally will have become convinced by 1967 that their best interests will lie in using only the new decimal coins after that stage, thus avoiding fractional units.

In paragraph 188 of the report, (he Decimal Currency Committee stated -

It has been suggested that the adoption of the lOs.-cent system would be inflationary, in. the sense that prices without exact equivalents would bc raised to the nearest ‘cent above, and not reduced to the next lower. The first thing to be said about the system in this connexion .is. that prices in shillings or ending in sixpence, .would not be affected since . there are exact cent equivalents for these amounts. - No revision would therefore be required for those goods which’ do not normally include pence (other than sixpence) in their prices. . ,

Paragraph 189 states -

Furthermore if, as the Committee recommends, a half-cent is provided during the transition period, the extent of the adjustment necessary would be further reduced to those amounts which were not multiples of threepence.

Paragraph 190 reads -

A survey carried out for the Committee did not confirm that there was any significant scope for price increases in. the retail field. The survey showed that for articles priced at about £5, prices are expressed in even amounts (that is, in shillings or ending in sixpence). There would, therefore, be little or no latitude for increases in such prices.

Paragraph 191 states -

For prices below £5, the survey revealed that clothing, material and accessories (handbags, costume jewellery and so on) were priced either in even amounts or to lid. i Outside this field even prices generally prevail, excepting in the very competitive lines, and groceries, where pricing takes all possible forms including, frequently, the halfpenny.

In paragraph 192, the committee stated -

The prices of these lines, including groceries, would have to bc adjusted to the nearest half-cent, but the competitive factor here is so strong that it would not allow a greater over-all gross profit to be taken. There is, as a result little likelihood of price increases in this field.

Paragraph 193 is as follows:-

In the case of clothing and associated articles, the public would definitely benefit, since an article now marked 15s. lid. would undoubtedly be marked at 1.S9 units, showing a slight reduction. The price ending of lid. is very widely used (to such an extent that in some shoe stores, for example, practically every price ends in Hd.).

Those paragraphs strongly suggest that the committee addressed itself to the problem of prices in relation not only to the system it recommended but also to the other four systems. Having addressed itself to those four systems, it recommended in favour of the lOs.-cent system.

As the debate proceeded I discussed with my advisers one or two things that might occur if the 10Od. system were adopted, and I have some examples to place before the Senate. Let us consider the price of 6s. Id. which, converted under the 10Od system, would be 73 cents. Is it not possible that the 73 cents would become 75 cents under the 100d. system? A price of 8s. would become. 96 cents, but I suggest that a trader would be inclined to charge 99 cents. I mention those examples to indicate in a very broad way that if the 10Od. system were adopted it too would have within it possibilities for the trader to take advantage of the new system, if he wanted to do so.

A good deal has-been said during the debate about the forthcoming general election and the introduction of this legislation in relation to the time of the election.

I point out that since the report of the Decimal Currency “Committee was received in1960, it has been the subject of close and continuing examination by a Cabinet sub-committee. Action having been taken at the administrative level to set certain matters in train, the Treasurer (Mr. Harold Holt), speaking for the Government, announced weeks ago that he would introduce legislation before the parliamentary session ended. This legislation is now before us for the purpose of implementing a policy that was announced as long ago as 1958.

Part I. and Part V. of the bill are to be proclaimed immediately. Part V. deals with the setting up of the Decimal Currency Board to administer many aspects of this very complicated and detailed scheme. If decimal currency is to be introduced in 1966, it is necessary to establish the board and to have it working as soon as possible. In the most unlikely event of this Government not being in office after 30th November, the present Opposition will have an opportunity to do what it thinks is advisable. Nothing that we do to-night will create an irrevocable situation. If elected to office, the Labour Party will be able to proceed as it wishes.

Amendment negatived.

Original question resolved in the affirmative.

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

page 1448

APPROPRIATION BILL 1963-64

First Reading

Consideration resumed (vide page 1412).

Question resolved in the affirmative.

Bill read a first time.

Second Reading

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

– I move -

That the bill be now read a second time.

The purpose of this measure is to appropriate the amounts that will be required for expenditure in 1963-64 from the Consolidated Revenue Fund other than those amounts which will be provided by special appropriations and the Appropriation (Works and Services) Bill. The amounts sought for each department are. shown in detailin the second schedule to the bill, the sum of these amounts being £679,980,000. This bill seeks an appropriation of £378,216,000, the balance of £301,764,000 having already been granted under the Supply Act 1963-64.

The expenditure proposals of the Go vernment were outlined in the Budget speech and the details included in the schedule to this bill have already been examined under the procedure whereby the Senate in committee has “ taken note “ of the amounts included in the document “Particulars of Proposed Expenditure for the Service of the Year Ending 30th June, 1964 “.

Question resolved in the affirmative.

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

page 1448

APPROPRIATION (WORKS AND SERVICES) BILL 1963-64

Second Reading

Consideration resumed (vide page 1412).

Question resolved in the affirmative.

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

page 1448

ADJOURNMENT

Pensions

Motion (by Senator Sir William Spooner) proposed -

That the Senate do now adjourn.

Senator COOKE:
Western Australia

– I wish to refer to a statement made by the Leader of the Government in the Senate (Senator Sir William Spooner) about the case of two invalid - not age - pensioners which I mentioned in this chamber last night. These two people have suffered severely under this Government’s legislation. As a result of getting married they are paying more for accommodation but are receiving from the Commonwealth Government £1 a week less than single persons would receive. Senator Sir William Spooner was unethical enough to suggest that I had raised this matter without being requested to do so by the persons concerned.

These people interviewed me, andI think they tried to interview a Government member in Western Australia but could not gain audience with him. They told me that they had presented their case to the Department of Social Services but could not get any relief. They added that they thought they had been grievously hurt by the Government’s legislation. 1 informed them at that stage that the Government had implemented its legislation and thatI could not do more for them. I told them that if the Government did not intend to show any sympathy towards them - there are many such cases - the only way in which attention could be directed to the matter would be to bring it up in the House. I said that it was not my desire to do that.I told them further that if that was their wish, it was the only way open to me, and the Minister might be sympathetic to their case. They were not concerned about their own case only. They told me that there were many cases of a similar nature. I resent the suggestion that what I did was in bad taste. What 1 did was at the request of the persons who had been hurt. I again appeal to the Minister, and to the Government, to give consideration to the plight of persons in the position that I have described. The Director-

General of Social Services should be given the discretion to extend some relief to such people.

As a result of their marriage the couple I mentioned last night receive £1 a week less by way of pension from the Government. I repeat that it was not my desire to bring their case before the Senate, but I did so at their request. Mention was made of a doctor and a Baptist minister. The doctor and the Baptist minister did not advise the couple to get married, but advised them to do something to relieve the circumstances in which they were living. In asking me to bring the matter up, which I did, these people in effect offered themselves as martyrs. What happened in this case is not like what happens in the case of eviction orders, where action is taken quickly and quietly, and a family is put out on the street before any one knows what has happened. I raised the matter in the Senate in the hope that the Government would be sympathetic, not only to two people who asked me to do so, but also to many other people in similar circumstances.

Question resolved in the affirmative.

Senate adjourned at 11.32 p.m. till Monday, 28th October, at 3 p.m.

Cite as: Australia, Senate, Debates, 24 October 1963, viewed 22 October 2017, <http://historichansard.net/senate/1963/19631024_senate_24_s24/>.

View PDF View XML View in Voyant