Senate
20 September 1966

25th Parliament · 1st Session



The DEPUTY PRESIDENT (Senator Drake-Brockman) took the chair at 3 p.m., and read prayers.

page 501

QUESTION

LOMBOK

Senator KEEFFE:
QUEENSLAND

– I direct to the Minister representing the Prime Minister a question which I preface by drawing attention to Press reports over the week end which indicate that the plight of starving people on the Indonesian island of Lombok has now become serious. Will the Minister advise whether it is the intention of the Government, to make available to the distressed residents of Lombok an immediate shipment of grain or other suitable food relief?

Senator Henty:

– The Acting Minister for External Affairs will answer the question.

Senator GORTON:
Minister for Works · VICTORIA · LP

– To the best of my knowledge, the committee appointed by the Indonesian Government has not yet reported to our Ambassador over there whether assistance is required. If assistance were required, one would need to give consideration to whether one shipped grain from Australia or from the northern part of the island, about two or three miles away from the affected area, if at all.

page 501

QUESTION

VIETNAM

Senator FITZGERALD:
NEW SOUTH WALES

– I direct a question to the Leader of the Government in the Senate. Will the Minister. deny or confirm the statements published in Sydney and Melbourne newspapers yesterday that the Government may send a third battalion of troops to Vietnam to join the two battalions already there, should it be successful in the forthcoming November election? This is a belief that I gained from talks with many people in Vietnam, and I so expressed myself in the Senate last Thursday evening.

Senator HENTY:
LP

– The Prime Minister has made pretty clear statements on this matter. However, I suggest that the honorable senator put this question on the notice paper. If it is possible to answer such a question as this involving as it does a matter of Government policy, I shall get him a reply.

page 501

QUESTION

NORTHERN TERRITORY

Senator DAVIDSON:
SOUTH AUSTRALIA

– Has the Minister representing the Minister for Territories read a statement made by Sir Hudson Fysh to the effect that the Commonwealth might cede the Northern Territory to South Australia - a situation which existed up to 1910? Can the Minister say whether any consideration has been given to a proposition of this kind or whether there is any likelihood of consideration of it and its possible effect on the total picture of northern development?

Senator GORTON:
LP

– I saw in the Press a statement attributed to Sir Hudson Fysh on this matter. To the best of my knowledge, there has been no consideration by the Government of this question, lt is clearly a matter of policy and the situation is likely to remain that the Northern Territory continues under the administration of the Commonwealth Government.

page 501

QUESTION

SOCIAL SERVICES

Senator MARRIOTT:
TASMANIA

– 1 refer the Minister representing the Minister for Social Services to a statement by Senator Turnbull, who is a doctor of medicine, as reported at page 431 of the Senate “ Hansard “, that a single girl - and in this context he was referring to an unmarried mother - who is registered with a medical and hospital benefits fund is not entitled to a Commonwealth allowance or fund benefit in such circumstances. Will the Minister make the record truthful by stating the facts?

Senator Dame ANNABELLE RANKIN:

– J did note what Senator Turnbull said and 1 have also noted some Press reports concerning his statements. I have obtained an answer to those statements not only from the Minister for Social Services but also from the Minister for Health whom I also represent in this chamber. The Minister for Social Services has informed me that any woman who resides or intends to reside permanently in Australia and who gives birth to a child in Australia is eligible for the maternity allowance. There is no means lest and no marriage requirement is involved. The amount of the maternity allowance obtainable depends on the number of children a woman has in her care. An allowance of $30 is paid where there are no other children under 16 years. If it is desired, a mother may receive $20 of the allowance before the expected birth of the baby. Of course, this amount will be deducted from the full allowance entitlement.

In reply to the honorable senator’s statement on hospital benefits in such cases, the Minister for Health has informed me that for Commonwealth benefit purposes, the usual two months waiting period after joining an organisation applies in confinement cases and benefits are payable irrespective of the contributor’s marital status or whether contributions are being paid at the family or single rate. With regard to fund benefits, single persons paying the single rates of contribution are generally eligible for fund benefits in respect of confinement provided that they satisfy the normal waiting period of nine months or ten months according to the rules of the fund.

page 502

QUESTION

ROCKET RESEARCH

Senator LAUGHT:
SOUTH AUSTRALIA

– Can the Minister for Supply give the Senate details of the next tests by the European Launcher Development Organisation to be held, I believe, early in November at Woomera, South Australia? Will this be the last E.L.D.O. test to be held at Woomera? Can the Minister state whether the early cessation of E.L.D.O. activities at Woomera will alter the pattern of work performed at Woomera by the Department of Supply? Will Woomera be undertaking new activities not at present performed there?

Senator HENTY:
LP

– The Europa I firing, which will be firing No. 5, is to take place about November. As honorable senators will remember, No. 4 firing was made a few months ago. Altogether, the European Launcher Development Organisation plans ten firings of Europa I at Woomera. There might even be eleven firings because there has to be a final firing of all the three sections together and this may yet be carried out at Woomera. However, the decision has not yet been finalised. We will be engaged actively on E.L.D.O. work at Woomera until 1968-69.

Of course, other work is being undertaken at Woomera at the present time. We have one project called Sparta, in which the Americans are interested, and we have a joint project in which the British Govern ment is interested. Work on E.L.D.O. now represents between 15 per cent, and 20 per cent, of the total work load at Woomera. Unless additional work is found - I believe it will be - there will be a slackening off after 1969, but until 1969 the position regarding the work load will, if anything, improve a little, not deteriorate.

page 502

QUESTION

VIETNAM

Senator COHEN:
VICTORIA

– My question is directed to either the Leader of the Government in the Senate or the Acting Minister for External Affairs, whichever be the appropriate Minister. Has the Government noted the solemn warnings given yesterday by Pope Paul and SecretaryGeneral U Thant on the dangers of escalating the war in Vietnam, and their moving pleas for “ the need to reach a settlement now “, to use the Pope’s words? Recognising that the words are addressed to all nations, whether combatant or otherwise, will the Australian Government show by some positive responsible act or statement of its own that it is prepared to respond to the calls made by these spokesmen for the conscience of mankind? In particular, may we expect some constructive proposals from the Australian Government for consideration at the session of the United Nations General Assembly which opens this week?

Senator GORTON:
LP

– I noticed the statement made by Pope Paul urging a settlement in Vietnam. I also noticed that it said - in my view, this is quite essential - that any settlement so made must pay full regard to the rights and liberties of the people of South Vietnam. I also saw the statement attributed to U Thant on the question of Vietnam particularly. Whilst I might be inclined to agree with what are, after all, the opinions of one man, that this is not a holy war or even, for the major part, a war of ideologies, I would examine those opinions for the reasons which have been advanced by this Government. The view of the Government is that this does appear to be a war to ensure that armed aggression against a country will not succeed, and that the only basis for lasting peace in the world is for it to be shown that armed aggression will not succeed. That is why the Australian Government has adopted the course that it has.

page 503

QUESTION

NATIONAL CAPITAL DEVELOPMENT COMMISSION

Senator HEATLEY:
QUEENSLAND

– I direct a question to either the Minister representing the Minister for the Interior or the Minister for Works, whichever is the appropriate Minister. Would the Minister explain why the National Capital Development Commission has allocated such a minute proportion of its consultative and constructional work to architects and engineers in Queensland, compared with that allocated to architects and engineers in the other States?

Senator GORTON:
LP

– I think that this matter really comes under the administration of the Minister for the Interior. The National Capital Development Commission is a statutory authority which answers to the Minister for the Interior, and I think it has control itself over the sources it uses for construction work in the area under its control. If the honorable senator wants further particulars, I shall arrange for him to see the Minister for the Interior.

page 503

QUESTION

NATIONAL SERVICE TRAINING

Senator GAIR:
QUEENSLAND

– I desire to direct a question to the Minister representing the Minister for the Army. Can national servicemen, on completion of their service, sign up in the Emergency Reserve or are they allowed only to sign up in the ordinary Reserve?

Senator McKELLAR:
Minister for Repatriation · NEW SOUTH WALES · CP

– I think I know the answer to the honorable senator’s question but in order to be sure I prefer to obtain the reply from the Minister for the Army. 1 will let the honorable senator know the answer that I receive.

page 503

QUESTION

EUROPEAN LAUNCHER DEVELOPMENT ORGANISATION

Senator BRANSON:
WESTERN AUSTRALIA

– My question to the Minister for Supply follows on the question asked by Senator Laught. Can the Minister tell me when it is estimated that the European Launcher Development Organisation project at the Yirrkala Mission in Arnhem Land will be finished and whether it is likely to be finished on that date?

Senator HENTY:
LP

– I have not the latest statistics on this project. From what I know of the matter at the moment, I understand that the completion date is a movable-

Senator Willesee:

– Feast?

Senator HENTY:

– Yes, a movable feast. I will obtain some details in regard to the matter. I have no knowledge of when the project is due to be finished or what stage has been reached at the present time. If the honorable senator will put the question on the notice paper, I will obtain the information he requires.

page 503

QUESTION

ADMISSION OF MAINLAND CHINA TO UNITED NATIONS

Senator MCCLELLAND:
NEW SOUTH WALES

– Has the attention of the Acting Minister for External Affairs been drawn to a statement by U Thant, the Secretary-General of the United Nations, that it is impossible to view such outstanding problems as the crisis in South East Asia and disarmament without China being admitted to membership of the United Nations? In view of this statement by such an eminent world leader, and the reports that the United States of America is reconsidering its attitude towards the admission of China to the General Assembly of the United Nations, and bearing in mind the huge volume of trade amounting to over $105 million that Australia had last year with China, will the Australian Government in the interests of world peace be prepared to review its policy of opposition to China being admitted to the United Nations?

Senator GORTON:
LP

– I am not sure why the honorable senator believes that world peace is likely to be shattered if Mainland China is not admitted to the United Nations. In answer to his question, I did see this statement in the expression of U Thant’s opinions. I think U Thant drew some attention to the fact that he believed that it would be good for one-quarter of the population of the world to be represented in the United Nations. It did cross my mind at the time that the size of the population of a particular country did not necessarily seem to have much result in the deliberations of the United Nations where each country, whatever its size - even a country of a couple of hundred thousand people - has an equal vote in the deliberations carried on in that chamber. The policy of the Australian Government in this matter has been made clear on more than one occasion. That policy has not been changed.

Senator CORMACK:
VICTORIA

– Arising from the question asked by Senator McClelland and the answer given by the Acting Minister for External Affairs, I ask the Minister a supplementary question. In view of the statement made by U Thant, will the Minister inform the Senate whether the requirements of admission to the United Nations are the acknowledgment by an applicant nation that it will accept the responsibilities that are placed upon a member by the Charter of the United Nations? Will he explain to the Senate whether it is a fact or not that the People’s Republic of China has refused to apply for membership of the United Nations until the United Nations resolution branding the People’s Republic of China as the aggressor in North Korea is withdrawn by the United Nations?

Senator GORTON:

– I do not know whether Mainland China has made the withdrawal of that resolution an official condition conveyed to the United Nations. But there is no doubt that Mainland China has unofficially made it quite clear - this might have been put forward officially, I do nol know - that it requires the resolution in which, by a vote of the United Nations, it was declared the aggressor when it backed the attack on South Korea, be withdrawn. 1 understand that Mainland China requires also that the Republic of Taiwan certainly should not be accepted as a member by the United Nations and accordingly should be handed over with its population to the rule of Mainland China. That appears to be the answer to the questions asked by the honorable senator.

page 504

QUESTION

EDUCATION

Senator HENDRICKSON:
VICTORIA

– 1 direct the following questions to the Leader of the Government in the Senate: Has the attention of the Government been drawn to the issue of the “ Border Morning Mail “ of last Wednesday, the whole of the front page of which was devoted to a magnificently worded appeal to the Federal Government for support for a long standing request for funds to enable the establishment of a university to serve northern Victoria and southern New South Wales? Is it a fact that even though a Federal Minister resides in the area support for this proposal has not been forthcoming in the past? Before a decision is reached - L understand it Is to be given this week - will the Leader of the Government in the Senate study this most important and impelling appeal and indicate to the people of this important part of Australia that the Government is sincerely and sympathetically interested in the establishment of a university in the Riverina?

Senator HENTY:
LP

– I did not see the issue of the “ Border Morning Mail “ to which the honorable, senator has referred. Now that he has raised this matter, 1 shall have great interest in studying this issue of the newspaper. No doubt it is in the Library. I shall see what the article states and will then give him an answer as soon as possible.

page 504

QUESTION

EMPLOYMENT AND UNEMPLOYMENT

Senator COHEN:

– I ask the Minister representing the Minister for Labour and National Service whether it is a fact, as stated today by the financial editor of the “ Sydney Morning Herald “, that in the month of August the number of persons registered for employment rose by 3,400 on a seasonally corrected basis, and that the gap between the number of persons seeking jobs and the number of registered vacancies increased by 4,700 in that month? If this is a fact, what explanation can the Minister provide for yesterday’s misleading statement by the Minister for Labour and National Service that the gap had narrowed during August?

Senator GORTON:
LP

– In this question we have another example of a questioner making a statement that is not necessarily true. The honorable senator described the statement of the Minister for Labour and National Service as being misleading. He has produced no evidence at all to suggest that it was misleading other than a query whether a certain newspaper writer was correct. The question should be put on the notice paper so that the honorable senator may get from the Minister for Labour and National Service an answer clearly setting out just what the position is. I take advantage of this opportunity to reject the assumption that something is misleading just because an honorable senator has read a newspaper article.

page 505

QUESTION

NATIONAL SERVICE

(Question No. 828.)

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

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

Will (the Minister assurethe Senate that national service trainees who have qualified for their commercial pilots’ licences will not be used as infantrymen?

Senator McKELLAR:
CP

– I am sorry that Senator Turnbull is not in the chamber to hear the answer. In his absence, I should like to explain that when this question was asked it was not directed to the Minister for the Army. This has been one of the reasons for the delay in answering it. The Minister for the Army has now provided the following answer -

  1. In allocating national servicemen to the various Corps, the Army aims at making the maximum use of their qualifications and skills, subject to the existence of suitable vacancies and the individual soldier’s preference. However, as the allocation must take account of the Army’s needs, no assurance can be given that any individual will not be allocated to the Royal Australian Infantry Corps.
  2. The possession of a civilian commercial pilot’s licence is not in itself a sufficient qualification for Army flying duties. A period of training and assessment would be necessary to establish whether the person has the required temperament, aptitude, sense of responsibility, skill and stamina to become an efficient Army officer and pilot.

    1. The Army, in collaboration with the Royal Australian Air Force - which also has responsibilities for the training of Army pilots - has examined the extent to which a national serviceman in possession of a commercial pilot’s licence and currently employed in flying duties, could be usefully employed as an Army pilot. Initially, the national serviceman in this category must apply and be accepted for officer training at an Officers Training Unit. The successful graduate from O.T.U. would then be required to satisfy a board of examiners of Army and R.A.A.F. flying instructors in a practical and theoretical aviation examination to ensure that he measures up to the standards required of Army pilots. If accepted, he would then be required to undergo an advanced flying course after which, subject to successful completion, he would be employed in aviation duties.
  3. In addition to these special arrangements for national servicemen possessing a commercial pilot’s licence and being currently employed in flying duties, any national servicemen wishing to become an Army pilot, and fit in accordance with Royal Australian Air Force standards as well as having the necessary qualities for officer training, may be selected for training if he undertakes to accept a five year short service commission in the Australian Regular Army.

page 505

QUESTION

OIL SEARCH

(Question No. 927.)

Senator MULVIHILL:
NEW SOUTH WALES

asked the Minister representing the Minister for National Development, upon notice -

  1. Is it a fact that a Government owned corporation has been set up in South Africa to take an active part in oil exploration?
  2. In view of the fact that Australia produces only 2.7 per cent, of its own oil, will the Government consider the establishment of a similar Government owned corporation to search for oil in Australia?
  3. What steps are being taken to make this country independent of overseas oil supplies?
Senator HENTY:
LP

– The Minister for National Development has supplied the following answers - 1 Yes. A Government owned corporation. Southern Oil Exploration Corp. Ltd. has recently been established to explore for oil in South Africa. 2 and 3. The Government, through its subsidy - now amounting to a total of $56.8 million - topographic, geological and geophysical surveys, and taxation concessions for Australian oil exploration company investors, has stimulated the effort to the point where oil and gas has been found in many of the sedimentary basins of Australia. Present production is about 3 per cent, of annual requirements of oil and total indicated reserves are about 200 million barrels.

The Government is continually examining the oil exploration situation in order to decide what further action, if any, should be taken to increase the rate of discovery of oil reserves.

page 505

QUESTION

VIETNAM

(Question No. 938.)

Senator COHEN:

asked the Minister representing the Minister for External Affairs, upon notice -

  1. What was the total cost of printing and distributing each of the following pamphlets issued under the authority of the Minister for External Affairs -

    1. “Viet Nam - Recent Statements of Australian Policy “ - November 1965;
    2. ” Viet Nam - Questions and Answers “- May 1966; and
    3. “Viet Nam and SEATO “ - June 1966?
  2. How many copies of each pamphlet were printed?
  3. What was the distribution of copies of each pamphlet?
  4. How many copies of each pamphlet were sent to-

    1. Government secondary schools in each State or Territory; and
    2. Non-Government secondary schools in each State or Territory?
Senator GORTON:

– The answers to the honorable senator’s questions are as follows - 1. (a) Approximately $3,100.

  1. Approximately $4,100.
  2. Approximately$1, 000. 2. (a) 75,000 copies.
  3. 100,000 copies.
  4. 30,000 copies. 3. (a) 75,000 copies.
  5. 91,000 copies.
  6. 22,000 copies.

Copies of the three pamphlets were distributed to members of Commonwealth and State Parliaments, the Commonwealth Press Gallery, newspaper editors and Australian diplomatic missions abroad. In addition, copies of pamphlets (a) and (b) were distributed to businessmen, clergymen, trade unions, political parties, university and public libraries, headmasters of secondary schools and foreign diplomatic missions in Australia.

  1. Five copies each of pamphlets (a) and (b) were sent to headmasters of both Government and non-Government schools in all States and the Australian Capital Territory. Copies of pamphlet (c) were not distributed to schools.

page 506

QUESTION

TELEVISION

(Question No. 951.)

Senator McCLELLAND:

asked the

Minister representing the PostmasterGeneral, upon notice -

  1. Is it a fact that the residents of Cobar, Louth, Bourke, Booligal, Tottenham and Lightning Ridge in western New South Wales are still without television?
  2. When is it likely that the 25,000 residents of these areas will be able to receive television?
  3. Until their own local television station becomes available to them, will the PostmasterGeneral give consideration to extending the power and range of the Broken Hill station to serve these areas?
Senator ANDERSON:
Minister for Customs and Excise · NEW SOUTH WALES · LP

– The PostmasterGeneral has supplied the following answers -

  1. Yes; however, the residents of the towns of Booligal and Tottenham may possibly receive a rather marginal or fringe area service.
  2. With regard to the future extensions of the television services I have asked the Australian Broadcasting Control Board to prepare a report and recommendations to me and the whole question of additional areas to which it may be possible to extend the national service must await the completion of the Board’s report. I should add, however, that at this stage in the development of television services I can hold out little hope for the early extension of service to distant and sparsely populated areas in various parts of the Commonwealth.
  3. It is not possible to extend significantly the population coverage of the Broken Hill station. The coverage of a television station does vary according to a number of factors, including the powerused. However, even for a high powered station operating in average conditions the reception is generally satisfactory only within a radius of about 60 miles. Thus the possibility of providing a service to the towns in question from Broken Hill station is non-existent as the closest of these towns to Broken Hill is over 200 miles from Broken Hill.

page 506

QUESTION

IMPORTS OF DAIRY PRODUCTS

(Question No. 957.)

Senator McCLELLAND:

asked the Minister for Customs and Excise, upon notice -

What has been the total value of imports of cheeses and other dairy products into Australia in each of the years since 1960?

Senator ANDERSON:
LP

– The following answer is now supplied -

Details of imports of cheeses and other dairy products cleared for home consumption in the years 1960-61 to 1965-66 are contained in Appendix “ A “. These figures have been supplied by the Commonwealth Statistician.

page 507

QUESTION

PREMISES FOR TRADE COMMISSIONER IN HOLLYWOOD, UNITED STATES OF AMERICA

(Question No. 959.)

Senator MCCLELLAND:

asked the Minister representing the Minister for Trade and Industry upon notice -

  1. Has the Department of Trade and Industry rented premises in Rossmore Avenue, Hollywood, U.S.A. for the use of an Australian Trade Commissioner?
  2. What is the monthly rent paid for the premises?
  3. Were the premises vacated at any time in the last 12 months; if so, for how long?
  4. What was the total rent paid for the premises whilst they were unoccupied?
Senator HENTY:
LP

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

  1. Yes.
  2. SUS675 per month, i.e. SA607 per month.
  3. Yes. The former Trade Commissioner, Mr. Mc’Rae, vacated the residence on recall to Australia on the 23rd February and the premises remained vacant until the incoming Trade Commissioner, Mr. M. J. Long, arrived on the 18th July 1966. The lease of the residence is for three years to 20th September 1967, with option of renewal for three years. Six months notice of termination must be given. If a residence had not been available when Mr. Long took up duly in Los Angeles the costs involved in keeping him, his wife and three children in a hotel until a satisfactory residence had been found would have approximated $A2,000 per mon 111. Mr. Long occupied the residence immediately on arrival.
  4. SUS3.375; i.e. SA3.035.

page 507

QUESTION

MAURITIUS

(Question No. 971.)

Senator MULVIHILL:

asked the Acting Minister for External Affairs, upon notice -

  1. What are the latest developments in regard to the Banwell Report which contained far reaching recommendations in regard to the electoral system in Mauritius?
  2. Has the British Government acceded to the request of the Mauritius Legislative Assembly seeking a conference between the political parties of Mauritius and the British Colonial Secretary in London?
Senator GORTON:
LP

– The answers to Senator Mulvihills questions are as follows -

  1. The British Parliamentary Under-Secretary of State for the Colonics, Mr. John Stonehouse, visited Mauritius at the end of June to discuss with the Mauritian Government and with the leaders and members of the Opposition the recommendations of the Banwell Commission on the electoral system. As a result it was agreed that certain amendments to some of the Commission’s proposals would be generally acceptable. With the agreement of the Premier of Mauritius, Mr. Stonehouse recommended these amendments to the Secretary of State for the Colonies, who accepted them, and welcomed the spirit of goodwill, understanding and statesmanship shown by all concerned in the discussions.
  2. In view of the developments referred to above, the conference previously requested by the Legislative Assembly in Mauritius has not been considered necessary.

page 507

QUESTION

NORTH QUEENSLAND NAVAL BASE

(Question No. 974.)

Senator MORRIS:
through Senator Scott

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

Will the Minister arrange for a:i investigation to bc made of the desirability of establishing a naval ba-e in the Cape Kimberley area. Mie 40 mile* north of Cairns, north Queensland, before any final decision is made 10 proceed with the establishment of a base on the western coast of Western Australia, especially in the light of the fact that the area has outstandingly valuable features for such a base, lends itself admirably to maximum security restrictions and has the additional merit of being within some 250 miles of the newly established Army base at Townsville?

Senator GORTON:
LP

– The Minister for Defence has furnished the following reply -

In reaching the decision to investigate the feasibility of establishing a naval support facility for the Royal Australian Navy in Cockburn Sound, the Government had regard to the totality of the factors that must be taken into account to meet the Navy’s requirements, including such aspects as safe anchorage, strategic location in relation to likely areas of operations, communications, an essential level of industrial manpower and support backing and the availability of existing Service facilities. On I his basis various possible sites in Western Australia have been considered fully over many years, and the area of Cockburn Sound has been the consistent choice of both Australian and overseas naval authorities. The technical investigation and design study now authorised will be lengthy and cosily. In the circumstances outlined above, further investigations to include areas other than Cockburn Sound would not be warranted.

page 507

QUESTION

EUROPEAN LAUNCHER DEVELOPMENT ORGANISATION

Senator HENTY:
LP

– I now have an answer to the question asked of me by Senator Branson as to when the European Launcher Development Organisation tracking station at Gove in Arnhem Land is expected to be completed. The station is expected to be completed in Mardi 1967. I should think that this would be about three or four weeks later than was expected previously.

page 508

LEAVE OF ABSENCE

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

That Senator Sir Alister McMullin be granted leave of absence for one month on account of absence overseas.

page 508

PHOSPHATE FERTILISERS BOUNTY BILL 1956

Second Reading

Debate resumed from 15th September (vide page 420), on motion by Senator Anderson -

That the Bill be now read a second time.

Senator CANT:
Western Australia

– The Bill has for its purpose the continuance of the payment of the subsidy on phosphate fertilisers for a further period of three years. 1 state at the outset that the Australian Labour Party does not oppose the passage of the Bill because it will give some assistance to primary industry. However, we intend to point out some of the weaknesses that, are engendered by this type of legislation. When the original Act was proposed in 1963 it was put forward as a measure to assist primary industry. If the debates of that period are studied, it will be seen that when the purpose of the legislation was questioned, in view of the Government’s discontinuation of the bounty in 1950, spokesmen for the Government stated that the bounty was to assist the industry in a time of difficulty. Of course, we know that it became necessary only as the result of a policy decision by the Australian Labour Party before the 1961 election, when it offered to give a bounty of £3 a ton on superphosphate. The Government, thinking that its position might bc in some danger in the 1963 election, decided to pick up that part of the Australian Labour Party’s policy and bring clown legislation to give a bounty of £3 a ton on superphosphate.

The Minister for Customs and Excise (Senator Anderson), in introducing this Bill, stated that in the past three years the use for phosphate fertilisers had increased by 46 per cent. It is claimed that this increase was as the result of the payment of a bounty, but this overall figure does not tell the full story. The increases have been 19 per cent, in 1963-64, 15 per cent, in 1964-65, and 12 per cent, in 1965-66. This shows that the increased use of fertiliser has gradually decreased over this period of time. The figures given by the Minister do not take into account increased land use. In Western Australia alone, approximately one million acres of new land are brought into use each year. If there is anything like this increase in land use in the other States, this factor alone would have a marked effect upon the use of fertilisers. The overall figure of an increase of 46 per cent, in the use of fertiliser does not give the true picture, because as more land is brought into use, automatically more fertiliser is required. It is not to be thought, either, that this increased land use in Western Australia is a new development since this bounty was introduced. Approximately one million acres of new land have been coming into production each year for a number of years, and this will go on for a considerable number of years.

When the bounty was introduced in 1963, it was estimated that the cost to the taxpayers would be $18 million. I have converted the amount to dollars for the purpose of easy reckoning. At that time it was stated as £9 million. That was in the first year. It was estimated that the bounty of $6 a ton would reduce the price to the consumer by approximately one third. In 1963, the average price of bulk fertiliser was about $14.60 a ton in the five mainland States after the reduction of the bounty. I have left Tasmania out of these calculations because the figures supplied to me by the research staff of the Parliamentary Library give the figures for Tasmania at the nearest rail siding. These would include freight.

In 1966 the price of fertiliser in the five mainland States was about $20.20 a ton. This was an increase in the price of bulk superphosphate of $5.60 or 38 per cent, after deduction of the bounty. If we examine the price of bagged superphosphate we find that the average in the five mainland States in 1963 was about $17.60 after the deduction of the bounty. In 1966 the price of bagged superphosphate had increased to an average of $25.25 after the payment of the bounty. This represents an increase of $7.65 or approximately 42 per cent. From these figures it will be seen that the value of the bounty has been eroded by increased prices. I am aware that there have been some increased costs as well because the cost of phosphatic rock has gone up. There has been an increase in wages also. But we have no assurance in the second reading speech of the Minister that the increase in the price to the consumer is anywhere near comparable with the increased cost to the producer. No provision is made in the Bill for an increase in the bounty as prices increase so the value ofthe bounty as an incentive to the greater use of superphosphate is doubtful.

If one studies the details of control of the industry, one finds it difficult to support an increase in the bounty unless there is some control of prices. Since the bounty was agreed to there has been a remarkable increase in the production of superphosphate and a remarkable concentration of control of the industry. We find that C.S.B.P. is owned by British Petroleum, Cuming Smith and Westralian Farmers Superphosphates. Each organisation owns 33½ per cent. Of course, British Petroleum is an overseas company. Albany Superphosphates is owned by C.S.B.P. to the extent of 75 per cent, and by Cresco W.A., 25 per cent. Commonwealth Fertilisers is owned entirely by Imperial Chemical Industries of Australia and New Zealand Ltd. I.C.I.A.N.Z. has a 53.4 per cent, interest in Australian Fertilisers Ltd., a 51 per cent, interest in A.C.F. and Shirley’s Fertilisers Pty. Ltd. and a 50 per cent, interest in General Fertiliser. The new ammonia making venture at Silverwater is controlled by I.C.I.A.N.Z. with 51 per cent, of the shares while Boral Paccal, C.R.A. and Mitsui hold the other 49 per cent. Boral Paccal has shares in Wallaroo-Mount Lyell. Wallaroo-Mount Lyell, Adelaide Chemicals and Cresco Fertilisers each has a 331/3 per cent, interest in Sulphuric Acid Ltd. WallarooMount Lyell, Adelaide Chemicals, Cresco Fertilisers and the Broken Hill Pty. Co. Ltd. each has a 25 per cent, interest in Nairne Pyrites.

This type of holding is common throughout Australia and exposes the overseas ownership of this important industry. The ownership and control of this industry is no longer in Australia. Therefore, when we agree to the bounty we must be careful to ensure that taxpayer’s money is not being used to subsidise overseas investment.

Senator CORMACK:
VICTORIA · LP

– The largest producer of phosphate rock in Victoria is totally owned by the producers in Victoria.

Senator CANT:

– I agree with that. The co-operative is the only one that is locally owned. I said earlier that we were not satisfied that the increase in the price of the product to the consumer is in line with the increase in the costs of production. The Phosphate Fertilisers Bounty Act makes provision for some control by the Minister. Section 14 (2.) states -

A producer of bountiable products is not entitled to bounty unless he furnishes to the Comptroller-General, in respect of each financial year in which bounty is payable -

a manufacturing account and trading account and such other information in relation to the bountiable products and fertiliser mixtures as the Minister requires; and

a certificate signed by the producer that the documents referred to in the last preceding paragraph are true and correct in every particular and a certificate, signed by an auditor, that those documents are true and correct to the best of the auditor’s knowledge and belief.

I noticedthat in another place the Minister for Air (Mr. Howson) said that the Government was satisfied that the companies were carrying out the intentions of the Act. But that was just a statement. I think it would be more assuring to the Senate and to the public to know that this is so in fact.

We find that the $6 subsidy, which comes out of the taxpayers money, has been absorbed in the increased price of superphosphate. Despite the fact that the bounty is paid, superphosphate is now costing the users more than it did previously. In every State in Australia, increases have occurred in freights, handling charges and road transport costs. In Western Australia it is very unlikely that users of superphosphate will be able to get the product on time unless they come to an arrangement to take it in the off season. This is due to the heavy demands made on the rolling stock of the railways. It means that farmers and graziers must build storage bins if they wish to purchase superphosphate in bulk, or storage sheds if they wish to purchase it in bags. This increases the cost to the users. In this way the intentions of the Bill are being eroded. However,the Australian Labour Party will not oppose the Bill, in view of the fact that it does provide some incentive and some assistance to primary producers.

Senator SCOTT:
Western Australia

– I am glad to hear that the Australian Labour Party has decided not to oppose this measure but to give it full support. I was very interested in the remarks of Senator Cant. He mentioned that, with granting of the subsidy of $6 a ton, the production of superphosphate throughout the Commonwealth has increased by 45 per cent, since 1963-64. Senator Cant has mentioned that the increased use of phosphate fertilisers, expressed as a percentage, has decreased over the last three years. The figures he gave are: an increase of from 19 per cent, in 1963-64. to 15 per cent, in 1964-65 to 12 per cent, in 1965-66. But when we take into consideration the increased amount of superphosphate used each year, this might still mean that the same increase in tonnage has been achieved each year. This is not necessarily so, but it could work out that way. The fact remains that in these three years the consumption of superphosphate throughout the Commonwealth, because this subsidy was granted, has increased by 46 per cent.

When we look at the matter closely, we find that the quantity of superphosphate consumed in Australia at present is at the rate cf approximately 4j million tons per annum. If we reduce that figure by the increase of 46 per cent, in consumption that has occurred since 1963-64, we note that the use of superphosphate has risen to 4$ million tons from a little less than 3 million tons some three years ago. When the Government created this subsidy in 1963, it had one thought in its mind, namely, to increase the production of primary producers throughout Australia by the use of increased amounts of superphosphate. There is no doubt that this desire has been achieved, because ever increasing quantities of superphosphate are being used in primary production. In Western Australia, larger acreages of wheat are being sown each year. The production of wool and sheep numbers have increased in the last three years. Sheep numbers have risen in this time by almost five and a half million. A corresponding increase has occurred in the production of wool. During the three year period that this subsidy has been paid, the acreage of wheat planted has increased by approximately 30 per cent. Looking at these figures, we find that the granting of this subsidy has played a large part in in creasing productivity throughout those areas of the Commonwealth that were not affected by the severe drought conditions.

Senator Cant went on to say that notwithstanding the amount of $6 per ton which has been paid as a subsidy on superphosphate over the last three years, the increase in the cost of superphosphate has almost exceeded, and in some cases has exceeded, the price of superphosphate. I think the honorable senator said that this depended on whether it was bulk superphosphate or bagged superphosphate. The honorable senator said that bulk superphosphate had increased by $5.60 per ton and bagged superphosphate had increased by a little over $7 per ton. This may be so. We are not contradicting those figures. The fact remains that this subsidy of $6 per ton is still being paid to producers. If this subsidy had not been granted, producers would be paying an extra $6 per ton for their superphosphate. The main objective of granting the subsidy has been achieved. Consumption of superphosphate throughout Australia has risen by 46 per cent, in three years, ff the Commonwealth required larger quantities of superphosphate to be used, no doubt it would grant an additional subsidy.

In certain areas of Australia, particularly in Western Australia, land is being cleared and developed so quickly that the farmers are unable to buy sufficient stock with which to stock it. It has been reliably stated in Western Australia that although stock numbers are rising at the rate of about 2 million a year, they are still 6 million short of the number required to stock adequately the areas that have been cleared and pastured in the last decade. So if we increased the subsidy, the disparity between the area cleared and the availability of stock would be enlarged. However, trie use of superphosphate in conjunction with subterranean clover has played a major part in the development of the southern areas of Australia. The payment of this subsidy, amounting to $28 million in the past year, has also played a large part in increasing the productivity of the southern areas.

I should now like to refer briefly to the need for the Commonwealth to encourage the use of superphosphate in our northern areas. A plan must be devised to encourage its use in the higher rainfall areas of northern Australia. When I refer to the higher rainfall areas, I have in mind areas that receive in excess of 30 inches of rain a year and which are situated in the north Kimberleys in Western Australia, in the Northern Territory, and in the Gulf country and the Cape York Peninsula and on the eastern coast of Queensland. In many instances these areas are a considerable distance from a port and in some cases are in excess of 1,000 miles from a superphosphate works. Whilst the price of superphosphate, including the subsidy, at various ports or capital cities is in the vicinity of $19 a ton, the cost of freight is prohibitive. Superphosphate that is delivered from Fremantle to the north Kimberleys is shipped to Wyndham or Derby, as the case may be, and is then overlanded a further distance of 100 or 200 miles. In such cases the cost of freight is in excess of the cost of the commodity itself. Reliable authorities on the development of northern Australia believe that a prerequisite to the development of this area is the application of superphosphate to permit the growing of legumes.

Senator Ormonde:

– Can superphosphate be thrown over unfarmed or untilled areas just as effectively as over tilled areas?

Senator SCOTT:

– In many areas of southern Australia subterranean clover pastures have been established on uncleared areas as a result of the use of superphosphate, but much better results are obtained by using the old agricultural methods of ploughing and planting. That is the main way in which pastures are established in the south. Trials have been carried out in the north with the throwing of Townsville lucerne and superphosphate on spear grass and wild sorghum country. When employing this method the best results are achieved by permitting germination, by burning off, and then by stocking the area very heavily after the first rain. It is necessary for the spear grass to be eaten down and to be kept down so that the sunlight can get to the soil to enable the Townsville lucerne to grow and establish itself. I repeat that to establish such areas satisfactorily it is necessary, first, to have the areas fenced; secondly, to burn off after rain and the germination of the first pastures; and thirdly, having thrown the superphosphate and Townsville lucerne on to the areas, to follow up with controlled very heavy stocking so that the wild or native pastures will not choke out the Townsville lucerne.

Millions of acres of such country in northern Australia are awaiting development, but it seems strange that the cost pf superphosphate is one of the factors that is retarding development. Therefore, it is necessary either to establish superphosphate works adjacent to the areas or to devise some method of subsidising freights on superphosphate in the initial stages of development. It is of vital importance that these areas be developed. But no-one can afford to develop them if he has to pay twice as much for superphosphate as do people in the south. No superphosphate company is prepared to invest money in these areas until there is an adequate demand for the product it produces. It is necessary to have a demand for 25,000 tons of superphosphate a year before a superphosphate works can be established. Most companies would regard an output of less than this quantity as being uneconomic. lt is apparent that something must be done to encourage the grazing community to use superphosphate. Until areas in the north require the use of about 25,000 tons of superphosphate annually and so warrant the establishment of a local superphosphate works, it is of vital importance that some form of freight subsidy be granted to the people living in northern Australia. At the moment, the quantity of superphosphate used in the North Kimberleys is practically nil. A few tons are used annually in the Northern Territory and I suppose that less than 1,000 tons are used annually on the Cape York Peninsula.

Senator Ormonde:

– More superphosphate might be used if ownership were restricted to smaller lots.

Senator SCOTT:

– I think that might be true. I would also think that people might be hesitant to use superphosphate, knowing its value of $19 a ton f.o.b. southern ports, and having to pay over $40 a ton for superphosphate delivered on their farms. In the future, someone will have to take notice of that discrepancy. When we consider the tremendous areas awaiting development in northern Australia I do not think it is too much to expect the Government to pay a subsidy, not of the full freight cost of superphosphate used to develop northern pastures, but of at least part of the freight charges. Let us assume that superphosphate is available at a works in a southern port for S 19 a ton and that the average freight charge to carry it to producers in southern areas is about $5 a ton: I think the Government could undertake to pay any freight charges in excess of a cost of $24 a ton for superphosphate delivered to farms, until” sufficient quantities were used to warrant the establishment of a local superphosphate works.

Rock phosphate has been used in northern areas. Rock phosphate dust has been brought into Darwin from islands to the north - Christmas Island and Nauru - for the establishment of pastures in the Northern Territory in particular, in relation to the experimental farms adjacent to Katherine. I do not know the results obtained, but I am aware that the solubility rate of rock phosphate is much slower than that of the manufactured article. Rock phosphate is much cheaper. I have not made a complete study of the question and 1 do not know how successful the use of rock phosphate has been. I am concerned at the need for the development of pastures in our northern areas. In the initial stages of pasture development large amounts of superphosphate are required.

I was pleased to hear Senator Cant say that the Australian Labour Party is not opposing the measure, which will extend payment of the subsidy for a further three years and thus enable our primary producers to carry on the development of Australia as quickly in the future as in the past.

Senator DEVITT:
Tasmania

.- I wish to address a few brief comments to this Bill, the Phosphate Fertilisers Bounty Bill, which, in itself, is simple enough. It sets out to do two things: First, to extend the period of payment of the bounty to 3 1st October 1969; secondly, to bring into current terminology the amounts of bounty to be paid. I agree with the remarks made by Senator Cant and Senator Scott on this Bill. The whole question has been outlined very well by the Minister for Customs and Excise (Senator Anderson) in his second reading speech. He pointed out that, consequent upon the granting of this bounty, the use of superphosphate throughout Australia increased dramatically to the extent of 46 per cent, over a period of three years.

I think honorable senators should take note that, year by year, the use of superphosphate has declined. During the first year of operation of the bounty the use of superphosphate increased by 19 per cent. During the second year of operation of the bounty, the increase dropped to 15 per cent, of usage before the bounty. During the third year - that is 1965-66 - the use of superphosphate dropped to 12 per cent, of that figure. I am assuming that the percentages are calculated on the former usage, so that over the period of three years there was an increase of 46 per cent. I wonder whether consideration has been given to the fact that those figures could reflect the mounting cost of superphosphate. In New South Wales at me time the superphosphate bounty was granted, the price of bulk superphosphate was $15.60 a ton. On 18th July of this year the price had increased to $20.60, an increase of S5 a ton. In Victoria the price of superphosphate has increased by about $7.50 a ton, and similar increases have occurred in the other States.

While, initially, there was obviously a demand for superphosphate and an appreciation by primary producers of the need to use superphosphate, after the bounty came into operation and provided financial assistance for primary producers it is significant that the price of the product to the primary producer has increased and the extent of its use during the period over which the bounty has been paid has fallen. I wonder whether the time is not fast approaching when, with the bounty set at its current figure, its effectiveness will be very largely lost as a boost to primary production. Perhaps the Minister may care to comment on that aspect at a later stage.

I think the Senate should bc told of the likely consequences of further development of the known deposits at Christmas Island. Many primary producers with whom I have spoken recently have been very much concerned at reports - which I am not able completely to confirm - of a possible quite substantial increase in the cost of superphosphate to them consequent upon a suggested 20 per cent, increase in the price we are to pay for Nauruan phosphate. The increase may not come into operation. I do not know. Perhaps the Minister could put us in the picture and allay many of the fears which are current at present as to what is likely to be the effect of a price increase upon the usage of superphosphate. When the report originated about five or six months ago, many primary producers felt that consideration ought to be given to an increase in the bounty from the current $6 a ton to a figure which would restore its value as an aid to the use of superphosphate.

I have noticed that the Minister for Territories (Mr. Barnes) is reported to have said, on 18th August last, in referring to the deposits on Christmas Island, that about one-third of the estimated 200 million tons of rock phosphate on Christmas Island visibly was first grade and comparable to that on Nauru. The newspaper report went on to state -

On average, however, the quality of the deposits may be a bit below that of Nauru.

Mr. Barnes said it was now possible to use the second and third grade deposits on Christmas Island in the manufacture of superphosphate.

The present extraction rate on Christmas Island is about 800,000 tons a year but. this will be increased to a million tons next year and to possibly more than 2.5 million tons by the early 1970’s.

This would more than meet Australia’s increased requirements, the Minister said.

Nauru now supplied about 40 per cent, of Australia’s phosphate rock imports, but Mr. Barnes predicts that by 1972 the figure will be down to about 30 per cent.

In an article in the “ Canberra Times “ of 20th July 1966 reference was made to a S5.5 million plan in which Australia and New Zealand, it seems, will be working in concert to exploit the phosphate deposits of Christmas Island. The article stated -

Within two years output is expected to rise from 780,000 tons to 1.6 million tons and a study aimed al eventually raising output to 2.5 million tons annually is continuing.

My purpose in mentioning those figures is to endeavour to have the Minister state in due course whether exploitation of the deposits on Christmas Island will offset increases in the cost of production of the Nauruan phosphates and so, as it were, maintain the status quo so far as the price of superphosphate in Australia is concerned. lt is essential that we should provide primary producers with every inducement to increase the output of primary products because, as I have stated here on previous occasions, Australia is still very much dependent on primary production to finance its overseas purchases. Therefore, any boost that we can give to primary production, by the provision of a bounty or by other means, is of assistance to Australia generally. I appreciate, of course, that bounties cannot be distributed all over the place, but I would like to see the position of the farmer maintained or stabilised. If we can ensure, by means of exploitation of the Christmas Island deposits, that there will be no dramatic increase in the cost of superphosphate we shall be achieving something worthwhile. One of the problems involved in the exploitation of the Christmas Island deposits may be the provision of a suitable harbour so that ships can berth there and so that proper exploitation methods can be applied. I hope that at a later stage the Minister will be able to supply further information on this point.

The Minister, in his second reading speech, made the following significant statement -

The system of critically examining cost increase information supplied by manufacturers has resulted in one reduction of an announced price increase. In August 1964, I was able to announce that producers in New South Wales had reduced a price increase of 1 7s. per ton by 3s. 6d. down to 13s. 6d., retrospectively to the operation of the increase, following consultations between the Department and New South Wales producers.

It seems that there is a good deal of significance in the fact that the Department is obliged, right throughout the piece, to ensure that costs are kept down to a reasonable level. The Minister did not elaborate on the statement I have read from his second reading speech. He did not say how the reduction was brought about nor did he refer to the pressure that was used or the inducement that was given to cause the producers in New South Wales to re-assess the position and reduce the proposed increase from 17s. to 1.3s. 6d. a ton. Again, I would like the Minister to give a brief explanation of the way in which this reduction was brought about. Increases of prices are being made continually and it is very difficult to justify them in many instances. I am pleased that a reduction was brought about in this instance and I commend the Minister and the Department for taking the initiative and for ensuring that at least a small saving in cost was effected for the benefit of the users of superphosphate in New South Wales.

I should like the Minister to supply answers to the queries I have raised, particularly regarding the exploitation of the Christmas Island deposits. I should like to know whether suitable installations will be provided there, and I should also like information about the ultimate effect of the exploitation of those deposits on the price of fertiliser. May we expect a reduction in the price of superphosphate that is used by primary producers? As Senator Cant stated on behalf of the Opposition, we on this side of the chamber support the measure.

Senator PROWSE (Western Australia) [4.26J. - The stated purpose of the Phosphate Fertilisers Bounty Bill does not need a great deal of elaboration. The Bill is designed simply to continue for another three years the operations of the Phosphate Fertilisers Bounty Act 1963. However, I think it is necessary, having regard to the importance of the manufacture and use of superphosphate to the economy of Australia, to have a look at the operation of the bounty and its effect upon primary production and agriculture generally. The Minister for Customs and Excise (Senator Anderson) in his second reading speech quoted figures which showed that there has been an increase of 46 per cent, in the use of phosphate fertilisers in the three years during which the bounty has been operating. That is quite correct, but in considering that increase we must have regard to the fact that there had been an average increase of 6 per cent, per annum over the previous five years. Therefore, the actual increase due to the bounty should be reduced by that percentage to bring it into proper perspective.

If we consider the figures relating to the increased production during the three years of the operation of the bounty, on the basis on which Senator Devitt examined it, we find that really there has been a decline in the increased rate of usage. The rates for the three years were 13 per cent., 9 per cent, and 6 per cent, respectively. I do not think it is possible properly to evaluate such a position without having regard to the situation which exists in the various States of the Commonwealth. For instance, in New South Wales the effect of the bounty was greatly to increase the use of superphosphate. In the first year of the operation of the bounty, usage in New South Wales jumped by 29 per cent. In

Victoria, it rose by more than 12.33 per cent. In Queensland there was an increase of 34 per cent.; in South Australia, 18 per cent.; in Western Australia, 15 per cent.; and in Tasmania, 6 per cent. There was an overall increase throughout Australia, in the first year, of 17 per cent. But subsequently climatic and other conditions in the various States altered the relative rates of increase. For instance, in South Australia in 1964-65 the quantity of superphosphate used was 606,000 tons. In the next year there was no increase at all; the quantity used was exactly the same. In Western Australia the relevant figure for the first year of operation of the bounty was 864,000 tons. In the next year 868,000 tons - almost the same quantity - was used. Seasonal conditions have a considerable effect on rates of increase, but the overall rates are those that I have stated. It is clear that the bounty has had the effect of increasing the rate of usage.

However, if we attribute the increase in the rate of usage of superphosphate to the operation of the Phosphate Fertilisers Bounty Act and the consequent fall in prices, we now need to look at the present prices. Increases in prices have virtually eroded the effect of the bounty, although they have not yet had the effect of reducing usages. They occurred during the period from 1st January to 18th July. Prices had not risen to any great extent before 1st January; but since then the rises have been very sharp indeed. On a bulk basis the rises per ton have been as follows: In New South Wales $5; in Victoria $6.50; in Queensland $4.90; in South Australia $4.65; in Western Australia $5.70; and in Tasmania $3.25. Incidentally, I suggest that some explanation is needed of why the rises are different in the various States. Many of our producers still have to use superphosphate in bags. On a bagged basis, the rises per ton have been as follows: In New South Wales $7.25; in Victoria $9.70: in Queensland $6.70; in South Australia $6.70; in Western Australia $8: and in Tasmania $4. So we see that in most States the bounty has been more than eroded and, for the coming season, we are faced with paying prices that are higher than those payable at the time when the bounty was introduced. If we argue that the fall in prices following the payment of the bounty resulted in increased usage of superphosphate, surely it is logical to expect that the present price rises will result in a fall in usage, taking into consideration other relevant factors.

This debate on the Phosphate Fertilisers Bounty Bill gives us an opportunity to look at the situation with regard to superphosphate usage in Australia. The Minister has made some comparisons between the prices charged for superphosphate in Australia and in other countries, notably the United Kingdom, New Zealand and the United Slates of America. They show that the Australian price, to some extent, is lower than the prices in those countries. But we need to remember that the prices quoted are factory door prices. The cost to the user is the price at grass, which can vary from country to country. Much depends on the location of the superphosphate works in relation to the place where the superphosphate is used. If we simply compare factory door prices without taking into consideration the other costs that are incurred in the distribution and usage of superphosphate, we are apt to reach false conclusions.

Mr. J. G. Schroder, in an address that he gave to the Australian Institute of Agricultural Science on 21st July 1966 on the economics of supply and distribution of phosphate to the Australian farmer, stated that it costs between $13 and $15 a ton to get fertiliser from the factory to the farmer’s field. The figures for New South Wales, as quoted by him, were: Bulk rail freight $5.50; unloading and cartage $1.50; contract spreading $7; making a total of $14. He compared those figures with the total overall cost per ton, the components of which were: Raw materials $11.5; inwards freight and handling of raw materials $5; manufacturing $9.5; distribution from factory to field $14; making the cost at grass $40. I believe that that is an approximation or generalisation; but it illustrates the relative costs. The cost of distribution is considerably greater than the cost of manufacture.

I suggest that these factors support the demand that is being made very widely in farming areas for a top level investigation of the superphosphate industry. The Minister has given us the rather comforting assurance that under the Phosphate Fertilisers Bounty Act the manufacturers are required to justify price rises. That is very good. But I obtained from the Commonwealth Parliamentary Library Legislative Research Service some figures on increases in material costs during the period from 1963-64 to 1965-66. They show that sulphur prices rose by S4.70 a ton and the average cost of rock phosphate rose by $1.43 a ton. If we make a calculation on the basis of the relative amounts of ingredients used, the average cost of the materials used to make a ton of superphosphate rose by SI. 84. I have already quoted to the Senate the rises in the prices of bulk superphosphate in the various States.

Senator Anderson:

– What about the labour cost?

Senator PROWSE:
WESTERN AUSTRALIA

– I know that there are other costs associated with the manufacture of superphosphate. Material costs have risen, but I believe that it is very difficult to reconcile the rises in material costs with the overall rises in superphosphate prices, particularly when those rises are not consistent in the various States. There is justification for an inquiry on that ground. I think there is also a need for an inquiry into the economics of our present system of siting superphosphate works on the coast. The cost of haulage of the raw material for the manufacture of superphosphate on an economic basis should be, and is, very much less than the cost of haulage of the manufactured article. It takes only three tons of raw material to manufacture four tons of superphosphate, and because of the system we have of siting our works on the coast, the users of superphosphate have had hung around their necks, as it were, the unnecessary haulage of 25 per cent, of material - actually water - that is used in the manufacture. This is basically uneconomic, especially where the haulage is over considerable distances, as is the case in Western Australia, New South Wales and, to a certain extent, Victoria.

If the various States are genuine in their desire to see decentralisation of industry, they could have a look first at the decentralisation of the superphosphate industry and also at their willingness to charge an appropriate rate for the haulage of bulk materials. Obviously, it is ridiculous to charge for hauling bulk materials by the train load from port to works the same price as is charged for the manufactured superphosphate in broken lots, shifted to various destinations, and incurring large costs for rolling stock and demurrage. These things are eliminated in the haulage of bulk materials. We need to look at the economics of the siting of our superphosphate works if we are to have an economic industry, an industry that is really doing the best it can for the economy of the country.

Senator O’Byrne:

– Is there any decentralised place where sulphuric acid is produced, to which rock phosphate can be brought, making it economical to produce superphosphate in the country?

Senator PROWSE:

– This is not really a part of the problem. The real problem is to cart the minimum material of the greatest value to the point where it is needed. The superphosphate is needed in the rural areas and not in the vicinity of a port.

Senator O’Byrne:

– That is where manufacturers get the rock phosphate from overseas - at the port.

Senator PROWSE:

– Exactly, but the point I am making, which 1 think the honorable senator has not fully understood, is (hat only three tons of material are required to make four tons of finished material, consequently a lot of unnecessary material is being carried over the country. Mention of. sulphur brings me to some consideration of this most important constituent, not only in the manufacture of fertilisers but also in many industrial processes in Australia. I did make mention of the need for the development of our own sulphur production, when the Sulphuric Acid Bounty Bill and the Pyrites Bounty Bill were being discussed earlier this year. We must emphasise the need for a careful study of the situation in relation to our pyrites production of sulphur in Australia. Our sulphur costs are rising sharply. They have risen so sharply that at the moment the need for a bounty in the production of pyrites has gone. If we have this opportunity to develop our pyrites industry and the consequential production of sulphur, there is an opportunity to get down our unit costs so that Australia will become competitive, even in the event of a fall in the price of sulphur. It is important that we should develop our sulphur production as rapidly as possible.

I did quote, and I should like to quote again, what was said in this regard at the Tariff Board hearing when consideration was given to the sulphuric acid and pyrites bounties. Professor Hunter, of the University of Sydney, emphasised the importance of further research into the possibility of producing sulphur at the site where the pyrites was mined, so that we would not need to transport bulky material over long distances. A breakthrough in this regard would put Australia on a competitive basis with the rest of the world in the production of sulphur. I feel that the development of our sulphur producing potential is more important to the Australian fertiliser industry than is the discovery of deposits of rock phosphates in Australia, for I fear that unless those rock phosphate deposits were reasonably close to our points of manufacture the transport costs would be greater than the costs of landing rock phosphate here from overseas. The sulphur position is somewhat different. We know that we have extensive deposits of pyrites, and what we need is the application of some research into the development of those deposits.

I should like to touch upon another aspect of this question of phosphate utilisation. I dealt earlier with the rate of increase in usage. In Western Australia, although we are increasing our developed acreage to a great extent each year - about one million acres of land are being cleared and brought into production each year - and this results in a very great increase in our superphosphate usage, there is a retarding effect that is of great importance, [t is not of much use to increase production per acre on established areas by applying increased rates of superphosphate and consequently increasing pastures, if one cannot obtain the sheep to utilise the increased production of grass. If we are to do anything about our overall increase in production, we have to match our increased phosphate usage with an increase in our sheep numbers. Western Australia has been hampered very largely in this respect over the last several years because we cannot obtain the increased sheep numbers to use the pastures that we are growing. I feel that this situation will exist for some time in New South Wales, following the drought and the subsequent loss of sheep numbers. So the overall effect upon the economy of our failure to solve the sheep fertility problems is of very great importance. I urge the Commonwealth Scientific and Industrial Research Organisation to increase the impact of its research programmes on this problem of sheep fertility, because unless we put ourselves in a position where the industry can match the increase in acreage with the necessary sheep to utilise that increase, our economy will suffer. I know of no area where research has been more- strongly needed than in the field of sheep fertility. There is ground for a thorough investigation, not only into the price of superphosphate, but also into its use. It is useless to spend money on a bounty to encourage the use of superphosphate unless we can use the fertiliser economically. This is an economic problem of great magnitude and there should be a most careful investigation of it on both the Federal and the State levels. I have great pleasure in supporting the Bill. With other honorable senators, I regret that it was not possible to increase the bounty but if the price of superphosphate is to continue to rise, the position must be reconsidered soon.

Senator KENNELLY:
Victoria

.- lt was not my intention to take part in this debate until somebody placed in my hands some statistical information that really shocks me. I am shocked because the value of this bounty seems to have been eroded before the ink of the Bill was dry, just as happened with the recent increase of $2 in the basic wage. I do not deny that there has been some increase in the cost of production of artificial fertilisers, as Senator Prowse has said, but if my arithmetic is correct - and I might be a bit rustry in that respect - the figures relating to costs and prices reveal a remarkable situation. Since the bounty was introduced late in 1963. the cost of bulk superphoshate ex works, has gone up 33 per cent, in New South Wales. I use some superphosphate and the figures for Victoria stagger me because in that Stale the price has gone up nearly 60 per cent. Increases in other States are about 30 per cent, in Queensland, 28 per cent, in South Australia and 35 per cent, in Western Australia. These figures are approximate but they are an indication of the increase in the price of superphosphate. So the bounty of $6 seems to have been eroded so far as bulk superphosphate is concerned except for $1. In New South Wales, consumers are paying $2.50 a ton more than they were before the payment of the bounty. This is fantastic.

As Senator Prowse has said, this industry needs some investigation. I do not know any other industry that needs an inquiry more. I am also informed that because of automation, labour costs in the production of a ton of superphosphate are practically the same now as they were years ago.

Senator Ormonde:

– Who is getting the difference?

Senator KENNELLY:

– I do not know. I leave that to the honorable senator. Senator Prowse made a valuable contribution to the debate and concluded by saying that we would have to consider paying a bigger bounty. Who is getting it? The increase in the use of superphosphate has dropped to only 12 per cent, of usage before the bounty was paid. Farmers or agriculturists, or whatever you might call them, must have this commodity. It is vital to the production of primary produce which we export. I have referred to the price of bulk superphosphate but let us examine the prices of superphosphate in bags. It is true, as Senator Prowse has said, that the price in 1963-64, after the bounty of $6 was deducted, was $1.8.15 and now it is $25.40. In Victoria the price is worse. It was $15.35 in 1963-64 and now it is up to $25.05. So it goes right along the line.

As I have said, most Australian workers were fooled recently with an increase of $2 in the basic wage because the rise disappeared before the ink on the decision was dry, although the presiding judge considered that industry was capable of standing the increase. I would not deny the fertiliser industry a fair margin of profit. I believe that producers of the commodity are as worthy of their hire as anyone else including myself but this industry needs a thorough investigation to determine the reason for the rise in prices. If prices are going up and up, as they appear to have been doing from the information handed to me, it is clear that we will not be using 12 per cent, more superphosphate. The increase in consumption is falling each year. I think the total increase over three years was 46 per cent, of pre-subsidy consumption.

No Commonwealth Government irrespective of the political party in control, has any right to hand out the money of tha nation without some regard to how it is spent. With a bounty such as the superphosphate bounty, the Government should be sure that the benefits are going to the right people. In this case, it seems that the manufacturers are getting the bulk of the bounty. One is entitled to know whether this is warranted by the cost of production. For many years emphasis has been placed on the protection of manufacturers. I am not opposed to protection, provided that it is not abused, but we find that in many instances the prices of articles produced in Australia are only slightly below the prices of similar imported articles.

I think that the Government should consider what Senator Prowse has said. I understand that the Western Australian branch of the Australian Country Party is very interested in seeking an inquiry into the ramifications of the superphosphate industry. If the inquiry shows that the manufacturers of superphosphate are receiving no more than is reasonable, I believe that the users of this commodity will be in a far better frame of mind. As Senator Prowse mentioned, I do not think that we are entitled to pay larger and larger bounties unless we know who is receiving the real benefit from them. Are we paying this bounty in order to bolster the dividends of companies which, in the main, are owned by overseas interests and which are making a feast of this industry? I was pleased to hear Senator Cormack say that he knows of one fertiliser company in Victoria which is locally owned. I think it is a co-operative.

Senator Ormonde:

– The honorable senator should buy his superphosphate there.

Senator KENNELLY:

– I use a little, if I am lucky enough to get it.

Senator Cormack:

– I will give the honorable senator a few bags next time he is in trouble in that way.

Senator KENNELLY:

– I know that Senator Cormack would do that.

Senator Cant:

– What about the price?

Senator KENNELLY:

– I will see that I do not pay any more than I should. I want to be serious about the matter. I would say outside the Parliament that this is a ramp. The Government is wrong in introducing this Bill, however worthwhile it may seem to be on the face of it, without being able to tell the Senate the reasons for the increases in the cost of superphosphate that have occurred since the bounty was given. The companies might give some reasons, but whether they would be sufficient to justify the increases is another matter. If the Government could produce good reasons for the increased costs we would have more enthusiasm in supporting the Bill than we have at present.

Senator O’BYRNE:
Tasmania

.- I enter this debate briefly to make a few observations on the important phosphate fertiliser bounty. As the debate has proceeded it has become quite obvious that many honorable senators are concerned at the gradual erosion of the value of this bounty, which, after all, is paid by the Australian taxpayers, whether they live in Western Australia, Tasmania, Queensland or any other State. 1 think that the interests of the taxpayers should be always in the forefront of our minds when we are debating the expenditure of revenue that has been raised from them. When any man who has had experience on the land sees a flock of crows hovering around, he knows very well that in the vicinity there is some carrion that is desirable feed for the crows. Usually he will ride or drive over to where the crows are hovering and investigate the reason for their activity. When fishermen see seagulls clustering in a particular area of the sea they know that there is a shoal of fish feeding on smaller fish, and that the seagulls are there to pick up any of the leftovers.

A close examination should be made of the activities of the large companies which are associated with the production and distribution of superphosphate. On the figures that were presented in the debate in another place, it is apparent that something is radically wrong with this industry. International organisations are rushing in to monopolise the companies in Australia which are producing and distributing fertilisers. They are anxious to take control of those companies. But I would go so far as to say that this influence on the industry is a negative one. The international organisations are not here for the good of the Australian farmer. As long as the farmer can survive and as long as there are sympathetic governments which will provide bounties, the international organisations will be quite happy. They are in the industry only to expand their economic power and to produce high profits for payment to their shareholders in the form of dividends. Naturally, the more the industry becomes monopolised, the more will the value of the bounty be eroded. Indeed, I think that the time is near when the whole of the value of the bounty will be eaten up by the manufacturers. The farmer then will have to pay as much, if not more, for his product than he did before the bounty was introduced.

We have in operation a scheme to provide uniform prices, or at least subsidised prices, for petrol, oil and other similar fuels used for farming purposes in the outback. This has been a great boon to the farmers. It was a commendable move to introduce the concession. It could be likened to a hard living allowance or a climatic allowance for the farming industry. The point I want to stress is that I see the time coming when similar equalisation arrangements will have to be made in relation to superphosphate, so that people in new country - further out country - can receive the full benefit of this bounty.

Reference has been made to the possibility that the rate of use of superphosphate will decline. This could happen if we reach the stage where it is uneconomical to apply superphosphate in some country. I know of marginal land in the west of both New South Wales and Queensland where the carrying capacity would be increased considerably if the use of superphosphate was an economic proposition. Some of the rivers in west Queensland - I think particularly of the Thomson and Barcoo Rivers which are tributaries of Coopers Creek - flow through country which has never known what trace elements are. Some cf the hardy grasses such as Mitchell grass and Flinders grass have evolved in such a way that they are able to withstand the rigors of drought and sun. We do not know how these grasses would respond to a dressing of superphosphate. We will never know the answer on any large scale for the simple reason that the application of superphosphate in these areas would he uneconomical and, so, out of the question.

On the other hand, it should be part of the plan of the Government to find ways and means for the application of superphosphate in these areas in an endeavour to increase the carrying capacity of the land. Dramatic improvements in carrying capacity have occurred in some places. Where previously one sheep was run to every two acres, it is now possible to run two sheep to each acre. If the carrying capacity of many of the areas of marginal land were doubled - such a large proportion of our land is marginal - it could mean a great boon to our economy. The other matter to which I feel we should apply our minds is the new status that superphosphate has assumed in the whole mosaic picture of farming today.

Over the centuries, the requirements of farming have been soil, rain and sun. The most popular areas in which to farm in this continent were those in which the soil was naturally fertile. This land was valuable. Naturally, these were the areas which farmers made their first choice. Superphosphate has revolutionised farming. It has brought in a fourth dimension to farming. After all, the production of this soluble form of artificial fertiliser is a simple process.

I was amazed, when I was on Nauru earlier this year, to see phosphate rock itself. The island, one can safely say, is as barren as any island in the Pacific or Indian Oceans, other than a small fringe around the edge on which is supported the most spindly, uninteresting scrubby growth. The reason is that the phosphate is not available in a soluble form to the roots of those shrubs and plants. It is only when sulphuric acid is applied to the phosphate rock that it becomes water soluble and thus is available to the roots of the plants. Man has discovered this process. He has supplied to the plants this fourth dimension that nature in some cases has not provided. Man has made a breakthrough whereby he can readily supply this fertiliser direct into the soil. The roots of plants thrive on it. As an economic consequence, the returns to the farmers are doubled and even trebled.

When such an important happening as the triggering off of this new era in farming occurs, I consider it to be a breach of trust by any government when it allows the source of supply to fall into the hands of monopolists. I believe that just as the bounty paid in respect of the production of sulphuric acid, pyrites and copper is reduced as the profits of the companies manufacturing these products exceed 10 per cent., the companies producing superphosphates should have the same limit applied to them. The object of the payment of this bounty is to assist the farmer. Honorable senator’s have emphasised during this debate that the value of the subsidy is being eroded by extra costs all along the line in addition to the fact that the companies involved in superphosphate production are a series of subsidiaries and have cross shareholdings to such an extent that it is practically impossible to find out the profits that these companies are making from the industry.

I wish to stress just one point that is of tremendous importance to us as a primary producing nation. Through good diplomatic relations and the foresight of other people, fortunately we have had access to the deposits of phosphate rock on Nauru and Christmas Island particularly. As we have in Australia such a vast area of land that reponds so readily to the application of superphosphate, it should become a much more important and indeed a national responsibility - and the Government should have this at the forefront of its policy - to ensure that this commodity gets to the land at the cheapest possible cost. The subsidy represents an attempt by the Government to meet this requirement. Unfortunately, the policy of the Government has misfired in many ways. Its intentions are good until they come up against the very system that the Government supports - the system of getting in for your cut, for the quick quid, and letting the devil take the hindmost, so to speak. Unfortunately, this is the reason why this bounty is not giving full value to the farmers.

The Opposition supports the payment of this bounty. But I regret very much that the first result of the bounty which is the subject of a three year agreement has been to create a stimulus to farmers to use more superphosphate. The farmers have used more but not always economically. This is part of the process. If a farmer opens up new pastures, he applies a liberal dressing of superphosphate. The annual topdressing is on a reduced scale. This is reflected in the rate of usage, but an economic limit is reached beyond which the use of superphosphate should be reduced because of its cost and because of the diminishing value of the returns from the application of it. All these factors are of great importance. I believe that this matter needs a much more thorough review by those responsible for the administration of this bounty and those who have the interests of primary producers at heart. These are the people who produce from pasture improved land commodities that provide us not only with our food but also with a substantial part of our foreign exchange. For a country to be healthy economically at that level is a good sign. Such a condition becomes contagious. But to see a bounty on superphosphate eroded by causes that are outside our control is very undesirable. When I say that the causes are outside our control, I mean that the Government does not wish to control the people who are monopolising the industry. If the Australian Labour Party were to assume office, it would be obliged, under the terms of its policy, to ensure that the groups or organisations that have rushed in recently to take over the fertiliser industry did not exploit the farmer or the Australian public. If they did so, or if they acted in any way contrary to the interests of the Australian people, they would be amongst those who would be put on our list to be brought under much stricter control.

We do not oppose the Bill, but we do hope that when the bounty next comes up for review we will have seen very strong attempts made by the Government to get the benefit of the bounty to the man on the land, who deserves it and is making the ‘best use of superphosphate, and not to the hawks and the crows who are hovering around trying to monopolise the industry for the purpose of making profits and for the benefit of their own shareholders.

Senator CORMACK:
Victoria

– As a grazier who has used superphosphate for a great number of years, I must confess that the constant increase in the price of this commodity in relation to my cost structure causes me some concern. However, I am quite convinced that the case that has been made out by the Government for an increase in the bounty is fair enough. I direct the attention of the Senate to the remarks of the Minister for Customs and Excise (Senator Anderson) as reported at page 420 of the “ Hansard “ report. The Minister made this observation -

F.o.b. prices for standard superphosphate in terms of Australian currency in the United Kingdom, New Zealand and the United States of America are $24.69, $25.48 and $20.59 per ton respectively.

In other words, the prices paid in the three countries which are the major users of this commodity are comparable. The Minister continued -

The Victorian and New South Wales prices on a comparable basis, net of bounty, are S19.45 and $20.10 per ton respectively.

He added -

Price increases since the inception of the bounty scheme have been caused by rises in the cost of imported raw materials, sulphur and rock phosphate.

The world price of sulphur is governed by supply and demand throughout the world. Therefore, there is no control over a rise in the cost of sulphur. We are finding it extraordinarily difficult to control the price of rock phosphate, because the United Nations Conference on Trade and Development, otherwise known as U.N.C.T.A.D., is trying to ensure that the less developed countries, the less developed entities, get a higher price for their commodities, including, for example, jute and rock phosphate. With each increase in the bounty on superphosphate that is used in Australia, the owners of the phosphate deposits, particularly on Nauru, demand a higher royalty. The royalty on the extraction of rock phosphate at Nauru has gone up this year.

A method exists for checking to see whether the alleged monopolists are making the vast fortunes that Senator O’Byrne and Senator Kennelly claim they are making. I mentioned earlier in the afternoon, by way of interjection, that a large producer of superphosphate in Australia is situated in Victoria. 1 refer to the Phosphate Co-operative Co. Pty. Ltd. If an excessive profit is being made on the production of superphosphate, it must show up in the accounts of that co-operative. This organisation certainly rebates some of its profits. I and my family were foundation subscribers to this co-operative. We know that it is not making an excessive profit. The cost of manufacture or of the various processes could be readily checked by the Department of Customs and Excise. Indeed,

I assume that it has checked the costs of the private manufacturers as against those of the co-operative.

Senator O’Byrne introduced a new note when he said that superphosphate should go out into the marginal areas. One of the curiosities that are observable as a result of the stimulus that has been given by the bounty is what might fairly or reasonably be described as the misuse of superphosphate particularly in the livestock industry. Superphosphate is tending to be used as a condiment rather than in an economic manner. The Commonwealth Scientific and Industrial Research Organisation has demonstrated quite conclusively that the old, set stocking pattern for the production of wool from improved pastures in high rainfall areas involves an uneconomic use of the grass that has been stimulated by the use of superphosphate and of superphosphate itself. The Organisation has demonstrated that, by using what are known as high density stocking techniques, it is possible, with a given quantity of superphosphate, to raise production by approximately 250 per cent. So. wilh the price that is at present being paid for superphosphate, there is a substantial margin if there is a change of stocking patterns, particularly in the production of wool. As I indicated a little earlier, Senator O’Byrne raised a secondary argument when he referred to the use of superphosphate in marginal and low production areas. I suggest that that is not bound up in the problem now before us. If it is necessary in the interests of the economy generally to use this rather expensive commodity in areas of low rainfall and on marginal country - he gave western Queensland as an illustration - 1 suggest that that is another problem and that it is not related to the problem that we are discussing at present.

In the overall picture, involved in the problem we are now considering are the indirect benefits that the Australian economy has enjoyed in the past, and is enjoying now, as a result of the use of superphosphate. I refer to increased productivity. This is not measurable. But I suggest that, if it were measurable, it would be discovered that the price of superphosphate to the Australian producer not only is reasonable but also is within the capacity of the producer to pay. As related to my own activities, I certainly believe that that is so. 1 conclude by again mentioning that the Minister said in his second reading speech that the price of superphosphate to the Australian producer was well within the prices paid in New Zealand, the United Kingdom and the United States of America. Nothing that has been adduced this afternoon by honorable senators opposite indicates in any way that an excessive profit is being made by the processors of rock phosphate. I commend the Bill to the Senate.

Senator ANDERSON:
Minister for Customs and Excise · New South Wales · LP

– in reply - .1 am grateful to the Senate for lending its support to the Bill. Senator Cant, who led for the Opposition, and subsequent Opposition speakers said that they supported the measure. In fact, consistent with that support, several speakers have referred to certain aspects of the application of the bounty.

A number of arguments have been raised and have been fairly well canvassed by honorable senators. One argument put forward related to the effect of price increases on the use of superphosphate. It was said there had been a tendency to a declining use of superphosphate because of erosion that has taken place in its price. I do not accept that as a valid argument. The facts of life are quite clear. Senator Prowse summed up the position in one terse sentence when he said the climatic conditions are a real factor. All honorable senators should realise that on the eastern seaboard particularly, one of the worst droughts in our history has been experienced in the last few years. I think it is fair to say that it is elementary that, consequent upon that drought, there has been a corresponding decline in the natural increased usage of superphosphate. That point was referred to in my second reading speech.

Senator Kennelly made play on the fact that the increase was down to 12 per cent, of the pre-subsidy consumption in 1965-66. Let us be factual and acknowledge that particularly in New South Wales on huge tracts of land no sowing at all could take place, lt is only because of the rains which have come at the right time that redevelopment has taken place of the areas which virtually were allowed to lie fallow during the drought period.

The tonnage figures for superphosphate used show that in 1963-64 the increase was 576,456 tons. In 1964-65 the increase was 321,724 tons. Looked at superficially, it could be thought that those figures support Senator Cant’s arguments. However, in 1965-66 there was an increase of 483,327 tons. I will not argue that there has not been an erosion in terms of costs, because the facts are clear and my second reading speech refers to them. However, I do not think it can truly be argued that the slow climb in usage is a result of the price factor. I think we ought to recognise that there has been a slowing down as a result of climatic conditions which we all hope and pray will be overcome as a result of the present rains.

Senator Kennelly:

– Have the minister’s officers any idea of how much - a rough figure will do - superphosphate was used in the area to which he has referred?

Senator ANDERSON:

– We do not have that figure.

Senator Kennelly:

– It is no good the Minister coming in here and-

Senator ANDERSON:

– It is of no good Senator Kennelly using a generality and, when I answer him with a generality, beginning to shout. The facts of life are, even if Senator Kennelly does not know them, that in New South Wales probably the worst drought in our history has been experienced. While Victoria is a very attractive place, we have had a very tough time in New South Wales.

Senator Kennelly:

– Portion of New South Wales.

Senator ANDERSON:

– lt is a fact of life that the drought has had a serious effect upon the sale of superphosphate. Nobody would know the figure that Senator Kennelly requests.

Senator Kennelly:

– -Does the Minister have any idea of how much superphosphate was used?

Senator ANDERSON:

– It seems that Senator Kennelly has not visited the north western areas of New South Wales, when he asks a question like that. All the computers ever made are not likely to be able to calculate that answer. Senator Devitt, I think, asked me about Christmas Island. I sought advice from my officers, but ‘ they were not able to give me a great deal of information. They say that it is possible that some reductions may occur as a result of the Christmas Island situation. The British Phosphate Commission conducted a survey at Christmas Island. The results of that survey indicate that production can be increased very substantially to meet large additional requirements possible in the future. At present I am not able to give very much information about Christmas Island.

It seems to me that the arguments advanced hinge on the fact that there has been an increase in the price of superphosphate. We all acknowledge that, but we must also acknowledge that the purpose of the bounty is to encourage primary production. To this end, the Government will provide S28 million this year to the farming industry so that primary production may be increased. I think Senator Cormack covered the argument on price increases as adequately as I could. As I indicated in my second reading speech, price increases have occurred as a result of increased royalties, a significant factor, increased labour costs and increased freight charges. The conclusion cannot be escaped that those factors have resulted in increases in the price of superphosphate.

The Department of Customs and Excise has a commission to administer the bounty and to see that it is passed on to farmers. This has been faithfully done, lt also has the responsibility, as Senator Cant indicated, to have regard to any increases in costs. The starting point for this consideration is the time of the introduction of the bounty. When increases in costs occur, it is the responsibility of those people who increase prices to justify the increases to the Department in terms of costs.

I wonder whether my second reading speech was read in as much detail as it should have been read. I thought that even Senator Prowse was a little at fault when referring to comparative figures for other countries. In my second reading speech, figures were given, to use the words of the speech, “ on a comparable basis.” Therefore, to that extent, the figures are based on an attempt to obtain as near as is practicable the same standard.

Senator Prowse:

– There is a variation between the figures I quoted and the figures quoted by the Minister. I do not know which source is correct.

Senator ANDERSON:

– I do not know either. Frankly, I take the figures as presented to me by the Department as being authentic. Perhaps Senator Prowse could tell us what is his source and then we may check later to see whether there is any discrepancy.

Senator Kennelly:

– Surely a rise in price should not be glossed over just because superphosphate is obtainable more cheaply in Australia than elsewhere.

Senator ANDERSON:

– There, again., Senator Kennelly is putting into my mouth words that I did not use. It is a deplorable habit he has.

Senator Kennelly:

– You implied it.

Senator ANDERSON:

– No. The implication was in your mind. 1 was directing attention to the fact that Senator Prowse drew an analogy between my basis of comparison and his, and I merely pointed out that in my second reading speech I said that the figures had been calculated on a comparable basis. Senator Kennelly must not commit me to things I did not say. I know that I am capable of saying things which may not be very good. However, 1 have been rebuked by one of my colleagues for not addressing the Chair. All I am saying, Sir, is that the figures stated in my second reading speech were assessed on a comparable basis as between other countries and Australia. If Senator Prowse has other figures, perhaps he will be good enough to let me have them at an appropriate time and we can then try to find out whether there is any basis for the difference.

The purpose of this bounty, which the Opposition supports, is to assist primary production in Australia. The bounty will cost the Treasury $28 million for the next 12 months. The provision of this bounty is to be looked at in association with the provision of other bounties. I do not think I will offend against the Standing Orders if I state that the Treasurer (Mr. McMahon) in his Budget Speech referred to a proposed nitrogenous fertilisers bounty. The provision of such bounties is calculated to assist the farmers. I would be the last to say that there has not been an increase in the price of fertilisers or that that does not have an eroding effect, but it is also true that the $28 million Which the phosphate fertilisers bounty will cost in the next 12 months will find its way into the hands of the farmers and assist them to increase their production. For that reason, we wish to have the Bill passed by the Parliament.

The only other significant aspects of the Bill are, first, that it proposes to change all references to money amounts in the existing Act to the equivalent values in decimal currency, and secondly, to extend the operation of the Act from 14th August 1966 to 3 1st October 1969 so that it will come up for revision at a more convenient time. I amcertain that the provision of the bounty for a further three years will lead to an increase in the use of superphosphate, now that we apparently have come through the drought conditions, and will be of importance to primary producers.

Question resolved in the affirmative.

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

Sitting suspended from 5.44 to 8 p.m.

page 524

QUESTION

PROPOSED EXPENDITURE 1966-67

Motion (by Senator Plenty) agreed to -

That the Senate resolve itself forthwith into a Committee of the Whole for the purpose of considering the particulars of proposed expenditure for the service of the year ending 30th June 1967, and the particulars of proposed provision for certain expenditure in respect of the year ending 30th June 1967.

In Committee

Motion (by Senator Henty) agreed to -

That, unless otherwise ordered, the Divisions of proposed expenditure be considered in the following order -

Department of Supply, $78,052,000.

Department of Works, $32,930,000.

Civil Defence- Buildings $83,000.

Civil Defence - Repairs and Maintenance, $13,000.

Department of Works, $38,543,000.

Department of Customs and Excise, $17,991,000.

Department of Customs and Excise, $73,000.

Repatriation Department, $260,680,000.

Repatriation Department, $80,000.

Department of Housing, $4,457,000.

Department of Housing, $58,250,000.

Parliament, $3,664,000.

Department of Trade and Industry, $13,482,000.

Department of Trade and Industry, $26,000.

Department of the Treasury, $425,582,000.

Department of the Treasury, $27,959,000.

Advance to the Treasurer, $20,000,000.

Advance to the Treasurer, $20,000,000.

Department of National Development, $31,168,000.

Department of National Development, $47,492,000.

Commonwealth Scientific and Industrial Research Organisation, $28,720,000.

Commonwealth Scientific and Industrial Research Organisation, $1,292,000.

Prime Minister’s Department, $60,752,000.

Prime Minister’s Department, $7,002,000.

Attorney-General’s Department, $10,526,000.

Department of External Affairs, $38,060,000.

Department of External Affairs, $966,000.

Economic and Defence Support Assistance to members of S.E.A.T.O. and Protocol States, $2,000,000.

Department of Defence, $17,765,000.

Department of Labour and National Service, $8,649,000.

Administration of the National Service Act, $949,000.

Post Discharge Re-settlement Training, $2,000.

Department of Territories, $2,166,000.

Department of Territories, $15,000.

Christmas Island, $241,000.

Christmas Island, $78,000.

Cocos (Keeling) Islands, $123,100.

Cocos (Keeling)Islands, $20,000.

Norfolk Island, $76,000.

Northern Territory, $28,674,900.

Northern Territory, $29,853,000.

Papua and New Guinea, $70,933,300.

Papua and New Guinea, $290,000.

Department of Civil Aviation, $42,948,000.

Department of Civil Aviation, $6,250,000.

Department of Shipping and Transport,

$49,500,000.

Department of Shipping and Transport, $25,671,000.

Commonwealth Railways, $15,682,000.

Commonwealth Railways, $10,000,000.

Postmaster-General’s Department, $302,680,000.

Postmaster-General’s Department, $205,200,000.

Broadcasting and Television Services, $43,747,000.

Broadcasting and Television Services, $6,204,000.

Department of the Interior, $25,665,000.

Department of the Interior, $2,371,000.

Civil Defence, $700,000.

Australian Capital Territory, $21,498,700.

Australian Capital Territory, $50,779,000.

Department of Primary Industry,$35,880,000.

Department of Primary Industry, $3,545,000.

Department of the Navy, $193,673,000.

Department of the Army, $328,498,000.

Department of Air, $253,739,000.

Department of Health, $11,509,000.

Department of Health, $3,174,000.

Department of Immigration, $43,606,000.

Department of Immigration, $1,400,000.

Department of Social Services, $23,063,000.

Department of Social Services, $43,000.

Motion (by Senator Henty) agreed to -

That, in relation to each division in the particulars of proposed expenditure, the Chairman shall put the question - “ That the Committee takes note of the proposed expenditure “.

Department of Supply

Proposed expenditure, $78,052,000.

Senator KEEFFE:
Queensland

.- I want to discuss this proposed expenditure, particularly Divisions Nos. 763, 765, 773 and 787. The functions of the Department of Supply include research on various projects, the production of munitions, aircraft, etc., the purchase of general supplies for the armed forces and transport and storage services. We know that because it is stated in the report of the Department for the year 1965. The report for the year 1966 is not available. 1 believe that the Minister for Supply (Senator Henty) is open to criticism in this regard. We are discussing the proposed expenditure of this Department. This is the middle of September. But we have not yet seen the report of this Department for 1966. I understand that we are not likely to see it for some time. So, if there are any points in the particulars of proposed expenditure which require elaboration, it is obvious that we will not know much about them because we have not the report for this year. I suggest that it is regrettable that we know less about this Department than about most others.

Perhaps I will be excused if I sound parochial in referring to the expenditure in the year ended 30th June 1966. There is a great disparity between the amounts of expenditure in the various States. Victoria leads the field with $85,796,000. It is followed by South Australia with $47,776,000; New South Wales with $21,671,000; the Australian Capital Territory with $3,886,000; Western Australia with $3,51 1,000; Queensland - one of the major eastern States - with $2,824,000; and the Northern Territory with $150,000. I should like to have from the Minister a break-up of the expenditure in Queensland. Why was it so small? I would also like any other information that he can give. I have searched through many documents today in an endeavour to find out how this amount was expended and why Queensland is so far behind the other States in this respect. We talk about northern development, and this Government has developed the attitude that it is looking after the north very well. I have given the Committee figures that prove that, if some form of decentralisation is to be carried out, this is one avenue which could very well be followed.

Perhaps we can account for some of the disparity when we see that the government factories, in the main, are in Victoria, New South Wales and South Australia. There is a list of them on pages 32 and 33 of the Department’s report for 1965. Admittedly, that is an old document. But it sets out in detail the various factories and the places in which they are situated. I make an appeal on behalf of the smaller States, and particularly on behalf of my own State. It is significant that most of the contracts have been let in the two major States. New South Wales is a fairly good runner up to Victoria and South Australia.

I draw attention to an apparent discrepancy between the figures that I quoted a minute ago and those on page 120 of the particulars of proposed expenditure. The latter document indicates that the total appropriation for last year was $76,748,100, of which $71,364,173 was spent. The proposed expenditure for this year is $78,052,000. The Department underspent its appropriation last year, but we are providing a greater sum for it this year. The figures that were supplied to my colleague, the Deputy Leader of the Opposition in another place, do not appear to tally with these figures. The total of the appropriations was given as $90,936,000. If there is some confusion between the appropriations and the trust funds, the figures still do not tally. The total of the trust funds is nearly $75 million. Perhaps there is a simple explanation of this. I am sure the Minister will be able to give it to me later, if there is. The total of the appropriations tallies with the figures in the report of the Auditor-General. So there is only the one discrepancy.

In more detailed criticism, I bring to the attention of the Committee the fact that on pages 118, 119 and 120-

Senator Henty:

– Will the honorable senator give the division numbers?

Senator KEEFFE:

– I will give the details in a minute. A very large sum of money appears to be being made available in some cases for “ incidental and other expenditure “ and in other cases for “ other expenditure “. I will now give the items on which I want information. Under Division No. 763, sub-division 2, item 10, incidental and other expenditure, $170,000 is to be appropriated. Under Division No. 765, item 03, other expenditure, $100,000 is to be appropriated. This is very strange. They seem to be nice round sums. I do not quite know the reason why these nice round sums are to be appropriated. Under Division No. 773, sub-division 2, item 10, incidental and other expenditure, $162,000 is to be appropriated. That makes a total of about $430,000. It is strange that these large sums of money should be described as incidental expenditure. Is this petty cash, used for stamps, morning tea and like things, or is it for matters of more major importance? I think that we ought to have some detail on this.

I have some other queries. 1 refer to Division No. 763, subdivision 2, item 02, which relates to office requisites and equipment, stationery and printing. Last year there was an expenditure of $196,728, from an appropriation of $200,000. The proposed appropriation this year is $219,000. That is a fairly big increase under this heading. Provision for postage, telegrams and telephone services this year amounts to $314,000. Last year the expenditure was $277,937. I think that this also needs some explanation. I refer to item 05, which relates to training of personnel. Expenditure last year was $210,871. The proposed appropriation this year is $250,000. If I get an opportunity, I should like to elaborate on that matter. Under item 08, which relates to office services, there was an expenditure last year of $39,789. The proposed appropriation this year is $134,000. That indicates that a fairly big jump in expenditure is expected.

I wish to refer now to disposal sales, which are mentioned at page 151 of the Auditor-General’s report. The report relates to the Departments of Air, Army, Navy and Supply, but I wish to direct attention only to the last paragraph in the section, relating to the Department of Supply, which states -

The increase of $919,119 in disposals sales is due mainly to the disposal during the year of substantial stocks of aluminium ingots.

I think that the Australian electors would like to know how this large supply of aluminium came to be in stock, whether the Department bought the aluminium at a price below this amount and whether it made a profit when it disposed of the aluminium.

This is probably set out in a minor way somewhere in the Budget Papers or the Appropriation Bill, but I certainly could not find it. If the Department purchased this material as an over-supply, obviously someone needs to be criticised somewhere. If the Department sold the material at a loss in its disposal sales, obviously it is deserving of criticism in this respect.

I should like to raise another point while on the subject of disposal sales. If one can believe the advertisements that one reads in the daily press, in relation to the holding of auction sales by the Department of Supply, the Department must over-buy in large quantities. I realise that in large departments whether in private firms or government undertakings, there must be some surplus and accumulation of materials from time to time for which no use can be found. But 1 think that the Department would probably obtain better prices for its surplus stores if it disposed of them in such a manner that it did not work some sort of little operation that helped some of the people who are able to come in with large sums of money and purchase large quantities of materials. I have attended a couple of these sales. Obviously dealers in second hand stores and what-have-you are able to come in and purchase, perhaps, typewriters in a job lot. Suppose, for example, typewriters are purchased at £10 each. I would like to let the Minister know that many of these dealers will sell these goods in a single lot at double the price before they leave the auction room.

If the Department is to dispose of things in the best interests of the people of this country, obviously the answer in this case is to sell in smaller lots. Somewhere along the line is set out an expenditure of about $140,000 associated with disposal sales. Is it not better to pay the auctioneer to spend a little more time? In fact, the Department probably would not lose anything if it paid on a commission basis. The sale would go on longer but the Department would find that many individual members of the public would probably be prepared to purchase at a price that was better for this Government and the Australian taxpayers than if the goods were disposed of in great job lots to a small number of traders who are able to make an exorbitant profit in the process of reselling.

The Auditor-General refers, at page 228, to losses of stores by the Department of Supply amounting to $3,560. Nothing is set out in very great detail. The table shows that in relation to this Department there were four instances of losses of stores to the value of between $100 and $200, the total amount lost being $469. There were six instances of losses of stores to a value of more than $200, and the total value of the stores lost was $3,09 1 . 1 cannot find any reference to whether or not these amounts have been recovered or whether any attempt has been made to recover them. I assume that these particulars do not include the theft of money in two or three instances amounting to $1,677. This is set out, in detail, on page 224 of the Auditor-General’s report. It is obvious that in two of the three instances referred to recovery of the missing moneys is taking place. There is another very strange thing in relation to this Department. Whereas on page 224 of the Auditor-General’s report, in relation to the Weapons Research Establishment a receipt-

The TEMPORARY CHAIRMAN (Senator Wedgwood:
VICTORIA

– Order! The honorable senator’s time has expired.

Senator BENN:
Queensland

.- 1 wish to deal with Division No. 763, but before doing so may I mention that this is not a small or unimportant Department. As a matter of fact, it is one of the most important Departments that we have functioning in the Commonwealth Public Service. I am not concerned about the amounts paid to the officials employed in the Department. I know that they are all worthy servants of the Commonwealth. If anything, perhaps, they are underpaid. I am not questioning their salaries or anything else like that. 1 do not care whether the Department underspent its appropriation last year or whether it is going to overspend it this year, but there are one or two matters that I do want to bring up. I am not sure whether the Department has given special attention to them. Reference to the Schedule of Salaries and Allowances shows that under Division No. 763 the staff employed include a Chief Scientist, 13 Deputy, First Assistant and Assistant Secretaries. I have not a doubt at all that they are all required in a big Department like this which performs many services. One who understands anything about the administration and functioning of the Department appreciates that it has to safeguard the public’s interests and that it has pretty well every safeguard that one can think of. Reference is made to missing property, and in that connection also one must bear in mind that the Department is handling millions of items to the value of millions of dollars. The quantity lost in proportion to that handled is very small.

On the staff, the Department has 175 superintending scientists, scientific and professional officers, 175 cadets, 189 technical officers and technical assistants and 818 technical and drafting officers. I want to put to the Minister for Supply (Senator Henty) that I am concerned about the employment of Australians in scientific positions offering in the Public Service and elsewhere. I want to know from the Minister what the Department is doing to encourage young Australians to equip themselves so that they may qualify for technical positions offering in the Department. Is the Department making a special endeavour to have its own Australian scientists fill these positions? We see reports every day that Australian scientists are going overseas and we know that Australia recruits scientists overseas. It seems that special preference is given to overseas scientists. I want information on this and I want it complete, please. I can only ask the Minister for the information and I believe he will do his best to get it for me. The Minister will notice that there is such a thing as the recruitment of technical staff. Perhaps that is the special function of some officer in the Department. There is a heading at page 164 of the Auditor-General’s report - “ Central Transport Authority “. I am not clear what happens within the folds of that Authority. I do not know what duties are performed by the staff employed there. I have an idea, though, that the Central Transport Authority in some cities of the Commonwealth provides the drivers for the ordinary passenger vehicles that are operated by the Commonwealth Government for the public servants and others. They operate this fleet of cars in Melbourne, Sydney and probably in Brisbane. Later on, the Department of the Interior has to refund the costs. But while the Authority is operating the vehicles, the drivers are employed by the Department of Supply. The Minister himself is a good employer as an individual, but things could go on within his Department without his knowledge. Do the men get a break for a meal during their shift? Is there not a two way radio system controlled from one central part of the city where the men are working? Are not the men told over this two way radio- system to take their lunch? Everybody knows of course that Melbourne is only a bit of a village with gum trees everywhere! The men can drive into the shade of a gum tree and sit back and enjoy their lunch! Let us be realistic. It is a man sized job driving a big vehicle in the cities today and if a man is driving a vehicle for two or three hours, he is entitled to have a half hour or at least 20 minutes break somewhere in comfort. If a man is driving a car, he cannot simply take an instruction to have his lunch and drive to the side of a street to eat his crib. The Department should be reasonable. I ask the Minister to see to this for the benefit” of the men concerned. If the Minister were operating the vehicles himself, he would do that, and I would not find it necessary to talk in this vein. The Department might have 100, 150 or 200 drivers employed in Melbourne or many more. I will raise that question afterwards. lt happens that in the financial year 1965- 66. fewer vehicles were purchased and they were vehicles of a less expensive type with a resultant decrease in expenditure of $440,000. The Department is not buying so many of these vehicles now. It is letting transport out to private companies, to the people who operate hire cars, taxi drivers and others. Is this a part of the Government’s policy? The Department has been getting good service. It has been providing the cars for this sort of work but suddenly the total purchase of vehicles falls by nearly half a million dollars. There must be some reason for this. Apparently, the Government is not going to operate cars until they have travelled 100,000 miles. It still sells them at 30,000 miles.

Reference has been made to the operations of the Department in purchasing manufactures in the various cities. I am not parochial but I am a Queensland senator and if there is anything good going, it is my job to see that Queensland gets a share of it. The principal purchases of the De partment are motor vehicles, mobile machinery and accessories and repairs, machine tools, stationary machinery and accessories, clothing and textile items, foodstuffs, scientific and laboratory equipment, aircraft parts and equipment, metals, radio and telecommunications equipment. Let us have some information about these things. From where are they purchased? I know the system which operates in the purchase of these goods and it is a good one. It was in operation long before Federation. As a matter of fact, it is a copy of the old English system. It has stood the test of time and is hard to fault but it appears that the Department is going only in one direction and I shall point out how it is done.

If honorable senators look at page 164 of the Auditor-General’s report - and there is no more reliable authority than that in this connection - they will find under the heading of “ Production “ a reference to the aircraft factories at Fishermen’s Bend and Avalon, Victoria. Then there is a reference to explosives, filling and ammunition factories at Maribyrnong, and at Albion, also in Victoria. At Albion they manufacture high explosives, gun and rocket propellants and fill unguided rocket motors. At Footscray, also in Victoria, there is the manufacture of small arms ammunition, fuses, primers and cartridge cases. Ordnance equipment, projectiles, rocket motors and missile launchers, heavy forgings and fabrications are manufactured at Maribyrnong, Victoria. Ordnance equipment, large ship turbine gears, large fabricated structures, missile handling equipment and heavy engineering plant are manufactured at Bendigo, Victoria. The manufacture and reconditioning of marine diesel engines takes place at Port Melbourne, Victoria.

The biggest clothing factory in Australia, which is conducted by the Department of Supply, is situated at South Melbourne and Brunswick, Victoria. It is engaged in the manufacture of Service and other uniforms, clothing, canvaswear and accoutrements, including the Postmaster-General’s Department’s requirements. The design, drafting and reproduction services of the Department are situated at Maribyrnong, Victoria. The airframe repair workshops for the maintenance of piston engined and Canberra jet aircraft are situated at Parafield and Northfield, South Australia. Acids nitrocellulose and propellants are manufactured at Mulwala, New South Wales. The filling and assembly of gun and mortar ammunition, bombs, warheads, anti-tank rockets and pyrotechnic and demolition stores takes place at St. Mary’s, New South Wales. Rifles, submachine guns and machine guns are manufactured at Lithgow, New South Wales.

Of the nine large manufacturing establishments conducted by the Department of Supply, five are situated in Victoria, three in New South Wales, and one in South Australia. Poor little old Queensland has not got one works, although there are 375,000 people living north of the Tropic of Capricorn.

The TEMPORARY CHAIRMAN:

Order! The honorable senator’s time has expired.

Senator HENTY:
Minister for Supply · Tasmania · LP

– I would like to deal with a few of the matters raised by Senator Keeffe and Senator Benn. First, I would like to thank Senator Keeffe for giving me an idea. He said that he does not know a great deal about the operations of the Department of Supply, and I gathered that other honorable senators do not understand them very well, either. Perhaps we have been remiss in this regard. I think we should give honorable senators an opportunity to visit our establishments more often. 1 can assure any honorable senator that he would be welcome at any of the establishments.

Senator Marriott:

– The Army did not have much success when it invited honorable senators.

Senator HENTY:

– We will let the Army run its own business. I am running the Department of Supply. 1 would like to give consideration to this matter, so that arrangements could be made for honorable senators on both sides of the chamber to visit the establishments which we run. They are very big factories, as both Senator Benn and Senator Keeffe have said. There are a number of them. I am sure that if honorable senators visit them they will get an impression of a government enterprise which is, I believe, a credit to the factories.

Senator Keeffe:

– This will be handy because we will be the Government after November.

Senator HENTY:

– If the honorable senator is going to wait until the Australian Labour Party becomes the Government, he will never see the establishments. That time is a long way off.

Senator Laught:

Senator Cavanagh does not think that the Labour Party will become the Government.

Senator HENTY:

Senator Cavanagh has said that the Labour Party’s prospects are not very rosy because it has dud leadership or something.

Senator Cavanagh:

– I would not believe Press reports, if I were the Minister.

Senator HENTY:

– I should not have thought that; the honorable senator never quotes from anything else. But let us get on with the matters that have been raised. Senator Keeffe referred to the sale of aluminium. The initial purchase of aluminium was made at about the time of the Korean War, when certain essential raw materials were stockpiled. Of course, since that time aluminium industries have developed considerably in Australia, both in Victoria and Tasmania. We are well supplied with the local products now and there is no need for us to carry the stockpile which we had to carry when we were importing aluminium from overseas. We reduced our stockpile; we sold it.

Senator Keeffe:

– Did the Department lose money or make a profit on that?

Senator HENTY:

– I am sorry that I cannot answer that question. We bought aluminium at market rates, by tender. We sold it, by tender also, at auction rates - the best rates available.

Senator Keeffe and Senator Benn referred to the Department securing materials. We buy mostly for the Services. The Services state what they require, and then it is our job to negotiate contracts for the supply of those materials. We do that by calling public tenders. We have an industry advisory committee and an independent contracts board. The contracts board examines all public tenders for supplies and makes recommendations to the head of the Department. He examines the recommendations and makes his own recommendation to the Minister, who signs the acceptance documents for contracts. As Senator Benn mentioned, this has been the procedure for many years. The fact that those who secure the contracts are located mostly in certain sections of Australia really has nothing to do with the Department of Supply. We call for tenders. No matter where the tenders come from, once we are satisfied that the firms concerned can supply our requirements and that the quality of the goods is up to standard - wc have to be certain of that - we accept the tenders. 1 would be very pleased to see the establishment of further factories in Queensland and in my own State of Tasmania. The only contract that we have in Tasmania is one for the supply of boots. One factory in Tasmania has been successful in getting this contract for many years. As 1 have said, supplies for the Department are acquired by calling for public tenders. The tenders are examined by the industry advisory committee and then by an independent contracts board, which makes recommendations to the head of the Department, who then makes recommendations to the Minister. All tenders are acknowledged publicly. The Department of Supply mostly purchases supplies on behalf of the Services. We carry millions of pounds worth of stock. There are stockpiles of all sorts of things. I cannot tell the Senate about some of them because they are in the restricted category.

The $3,500 worth of supplies, the loss of which is mentioned in the AuditorGeneral’s report, is a small percentage of the total stockholdings. I think any business would be pleased to know that with a staff of some thousands of people and with the enormous responsibilities that the Department of Supply has to bear, it had lost only S3, 500 worth of supplies. We endeavoured to trace this lost material, the loss being discovered when we took stock, but we were unable to trace it.

Senator Keeffe referred to “ Incidental and other expenditure” in item 10, subdivision 2, in Division No. 763. Item 10 includes laundry, hire of computer facilities, maintenance of office machines and accounting equipment, public exhibitions and other sundry expenses. We have carried out quite a lot of work recently in providing public exhibitions, particularly science exhibitions in schools. This is giving good results. We are endeavouring to get children interested in this sort of work.

Our spacemobile has appeared in every capital city of the Commonwealth and is in great demand.

Senator Kennelly:

– Including the capital city of the north?

Senator HENTY:

– Yes, the spacemobile has been to Brisbane. It is in great demand. 1 turn now to Division No. 763, subdivision 2, Administrative Expenses - “ Office requisites and equipment, stationery and printing “. The appropriation in regard to this item has risen from $200,000 in 1965-66 to $219,000 in 1966-67. This is because of an increase in the order for stationery by the Department of Defence. The appropriation this financial year for the next item, “ Postage, telegrams and telephone services”, is $314,000 as compared with $280,000 last financial year.

Senator Keeffe:

– ls this the manilla folder for the Department of the Navy? Is the S.10,000 down the drain covered in this item?

Senator HENTY:

– The increase in relation to “ Office requisites and equipment, stationery and printing “ is cue to an increase in the volume of service demands requiring procurement action by this Department necessitating additional expenditure on stationery. I am dealing with the items about which the honorable senator inquired. If the honorable senator wants me to give these details, I will give them faithfully. I do not like to think that I am doing this for fun. Let me deal now with Division No. 765, “ Other Expenditure “ for which the appropriation this year is $100,000. The provision under this item is to cover miscellaneous costs which are not chargeable to production and include such items as analysis of material samples, retreatment and repacking of certain explosives stores, management consultant services, design of T.N.T. plant, and destruction of ammunition and explosives. Division No. 763, subdivision 2, item 03, to which I have already referred, shows increased appropriation of $34,000, from $280,000 last financial year to $314,000 for the current financial year. This increase represents the cost of the provision of additional telephones and extensions at 339 Swanston Street, Melbourne, in the three floors which were previously occupied by Trans-Australia Airlines.

Senator HENTY:

– Yes. This is the cost of the installation of those services in the Department of Supply building at 339 Swanston Street, Melbourne.

Senator Keeffe:

– Is the honorable senator referring to the increase from the appropriation last year of $280,000?

Senator HENTY:

– Yes. The honorable senator asked me about the increase which takes the appropriation to $314,000.

Senator Keeffe:

– That amount is being provided for in this Budget?

Senator HENTY:

– Yes. The honorable senator next referred to Division No. 763, sub-division 2, item 05, “ Training of personnel “. The appropriation rises from $210,871, being the actual expenditure last financial year, to $250,000 for this financial year. This applies to increases in Public Service Board and departmental scholarships - ‘postgraduate scholarships.

Senator Wood:

– This is “ Training of personnel “?

Senator HENTY:

– Yes. That is the reason. We understand that the extra money was for training personnel in these fields. A reduction does not take place in relation to “ Office services “ as set out in this division. The figure given is not incorrect. This appropriation represents the cost of transferring to the vote for the Department of Supply the appropriation of expenditure for lighting, cleaning, heating, etc., of the premises at 339 Swanston Street, which were met by the Department of the Interior. This expense is now met on the books maintained by the Department of Supply.

Senator Keeffe:

– Why is the item referred to as “ Office services “?

Senator HENTY:

– On the advice of Treasury, we placed this expenditure under that heading.

Senator Keeffe:

– I refer the Minister to my previous query in relation to Division No. 773, sub-division 2, item 10, “Incidental and other expenditure “. Is this another petty cash account? I want to know what the decrease represents.

Senator HENTY:

– This item, “ Incidental and other expenditure “, refers to expenditure other than the heads of expenditure dealt with in that sub-division. The honorable senator will see the expenditure dealt with in items 01, 02, 03, 04, 05, 06, 07, 08, 09, 11 and 12. Any expenditure that is not incorporated in those items is dealt with as “ Incidental and other expenditure “ under item 10. I have not the details in regard to that item.

The TEMPORARY CHAIRMAN__

Order! The Minister’s time has expired.

Senator ORMONDE:
New South Wales

– I wish to refer to Government Factories - Maintenance of Production Capacity. In doing so I suggest that two great minds have been thinking alike. I refer to the minds of Senator Benn and myself. I wish to make a plea for the town of Lithgow in relation to the increased development and production of munitions and items of war that have been announced in the report of the Department of Supply issued last year. May I remind the Minister for Supply that the Estimates last year were debated on on the 1964 report. I think that it would be better if the Department supplied us with an up to date report covering the estimates with which we are now dealing instead of releasing that report a month afterwards. This has happened two or three times to my knowledge. I think that something could be done about it. The present Minister did not “hold the portfolio then. Perhaps things would have been different had the Minister been in charge of the Department last year.

I refer to the town of Lithgow which has been excluded from the increased orders that were mentioned in the report of the Department of Supply for 1965. At page 25, the report deals with the increase in production and states -

The increase in production demands received from the Services has produced a significant growth in the work load in the ammunition and explosive field.

None of this increase has gone to Lithgow. Senator Benn dealt with Maribyrnong and named half a dozen factories in Victoria and a few small ones in New South Wales which are involved in this increased production. Lithgow seems to be in the forgotten land in relation to this increased production. Might I say this on behalf of Lithgow: Lithgow at one stage was the most important munitions town - probably it was the only one - in New South Wales.

It was also a coal mining town. As a result of the end of the coal mining industry in that town, Lithgow faced a problem. The present New South Wales Government, which does not happen to be of my own political colour, has followed the policy initiated by the previous State Labour Government of assisting Lithgow by subsidising industries there and trying to obtain employment for the people in this isolated town.

I am wondering why this Government has not attempted to give more work to the Small Arms Factory at Lithgow. Recently 1 was in London and in the south of England. During my visit 1 noted that right along the coast of the mouth of the Severn and along the bottom of the Rhondda Valley in Wales, where there was a depressed coal industry, where the mines were closed and where there was a great unemployment problem, the present British Labour Government, and earlier the Conservative Government, had set up ammunition factories. The British Overseas Airways Corporation had established factories there. The authorities did not do what this Government has allowed to happen in Lithgow; they did not establish handkerchief factories and all sorts of secondary light industries. Such industries provide jobs for girls, but they do not provide the real sort of security that ought to be given to a town. I suppose plenty of honorable senators have been to England and have seen major industrial undertakings such as the B.O.A.C. factories established in areas where the mines have been closed.

Lithgow was a two industry town. It was a munition making town and a coalmining town, but the coalmining industry has disappeared. There are pockets of serious unemployment in the district. On behalf of Lithgow I make a plea to the Government to place in that town any extra orders it might have. I imagine that extra orders will be placed if the Vietnam situation continues as at present. Something ought to be done to increase the work force that is employed by the Department of Supply in the Lithgow area. Probably labour is easier to get in Maribyrnong, Nicholson Street and similar places where masses of people work and live. Doubtless there are more avenues of employment in those areas. On the other hand, Lithgow is an isolated town. I would like the Minister to consider seriously passing to the Lithgow Small Arms Factory some of the extra production work that will be allocated by the Department of Supply. It is an established undertaking, and I am certain that it could do a lot of the work that needs to be done. It would not be difficult to get the necessary staff. Many of the people who could be employed still have their homes there and travel backwards and forwards to Sydney to work. I am sure they would rather return to their own industry.

I should like some information about a matter relating to the coal industry. Tonight the members of the Australian Labour Party’s Coal and Fuel Committee met and discussed the subject of coal, fuel and power in the light of the new developments that are taking place. In the Department’s last report, this paragraph was published -

Operation of a Ruston Hornsby gas turbine on pulverised black coal has shown the importance of fuel particle size on the process of gas cleaning and ultimately in blade erosion and folding. The operation of the engine combustor and ash separator is being critically examined under various coal feed qualities.

If the Department has succeeded in this experiment and if the results would be of value to the coal industry, I should like to know whether the Department has attempted to sell the idea to the industry and what stage of development has been reached. This development could make a very valuable contribution to solving the problem of providing an alternative use for coal in Australia.

Senator HENTY:
Minister for Supply · Tasmania · LP

Senator Benn asked about the encouragement that was given to young Australians to equip themselves technically for employment in the industries for which the Department of Supply is responsible. We have an active recruiting campaign for cadets, apprentices, Public Service Board scholarships and departmental studentships. A very high proportion of our staff consists of Australian trained personnel. Senator Keeffe asked why the sum of $71,364,173 shown as expenditure for 1965-66 does not balance with the sum appropriated for that year. The sum shown does not include expenditure incurred by the Department on behalf of other departments on items such as aid under the Colombo Plan and aid to Malaysia. These additional items of expenditure are listed in a reply furnished to the Deputy Leader of the Opposition (Mr. Whitlam) in another place. The sum shown in the estimates for the Department of Supply includes only departmental expenditure.

Senator Ormonde referred to conditions at Lithgow. The work force in that town has increased since 1965 and at present the Small Arms Factory has a very full work load. Of course, the Factory has been established especially for the production of small arms, but the possibility of its undertaking other kinds of production has not been ignored. Lithgow has widened the scope of its production over the past three years. It has begun to produce 9 mm. carbines, 81 mm. mortar bombs and fuse components, as well as continuing its high production of the LI A I rifle.

Senator WOOD:
Queensland

.- I refer to the proposed appropriation for extra duty pay under Division No. 773 - Defence Research and Development Laboratories. Last year the sum appropriated was $236,000 and the sum actually expended was $210,978. This year the Parliament is being asked to appropriate a sum of $288,000. It will be noted that last year there was an under-expenditure of a little more than $25,000. The sum we are now being asked to approve is approximately $77,000 more than was expended last year. Also, it will be noted that last year a sum of $350,000 was appropriated for travelling and subsistence, but a sum of only $255,303 was expended. In other words, there was an under-expenditure of about $95,000. In spite of that underexpenditure, this year we are being asked to appropriate about $45,000 more than was expended last year.

I am concerned about the over-estimating that has occurred in regard to various items. This could be very serious. If carried right through the Estimates as a whole, it could involve a considerable sum of money which probably could be used for many other projects which would be of advantage to the country. I should like to know why under-expenditure occurred last year and why in this present year we are asked to appropriate more than was expended last year. I should also like to know the position in regard to seeing that the Budget target is set as near as possible to the likely expenditure.

Senator BRANSON:
Western Australia

– I refer to the item relating to payment for services of the Commonwealth Police Force which appears in subdivision 2. - Administrative Expenses, Division No. 763. Last year an appropriation of $20,000 was made, and expenditure was $19,677. This year no appropriation has been made. A similar item appears under subdivision 2. - Administrative Expenses and General Services, Division No. 773. Last year an appropriation of $45,000 was made and expenditure was $42,241. No appropriation is included for this year. It seems probable that provision has been transferred elsewhere in the Estimates. If that is so, I would like to know where it is now included.

This year, an amount of $340,000 has been appropriated for Division No. 787. - Acquisition of Sites and Buildings. Last year an amount of $11,500 was appropriated and $10,756 was spent. I would like to know the reason for the steep increase this year to $340,000.

Senator HENTY:
Minister for Supply · Tasmania · LP

Senator Wood referred to the provision for extra duty pay in Division No. 773. The appropriation last year was $236,000 and expenditure was $210,978, or about $25,000 less than the appropriation. The increase in the appropriation this year reflects the Department’s increased efforts in the development of the Ikara anti-submarine weapons system for the Royal Navy. It is extraordinarily difficult accurately to predict the expenditure for this item, and also for the item providing for travelling and subsistence payments. Costs are related to the programme of weapon trials and can fluctuate purely for technical reasons. The honorable senator will understand that if a trial is not as successful as was anticipated, it is necessary to hold another trial. For that reason, the expenditure is difficult to predict. An assessment is made on the basis of performances in past years. It is a general estimate based on costs in previous years. It can be affected by increases in the numbers of staff, increases in salaries and wages granted by the Public Service Board and changes in arbitration awards. The items are very unpredictable and, by and large, in a total expenditure of $78 million, we have not been too far astray, although for some particular items we may have been a little more astray last year than previously.

I come now to the provision for the acquisition of sites and buildings included in Division No. 7S7. The Department has purchased a new property for the clothing factory to which Senator Benn referred. Any honorable senator who has seen the old factory in South Melbourne will appreciate that the sooner we get out of it the better it will be for the Department. Senator Branson referred to previous appropriations for payments to the Commonwealth Police Force. Such costs are now being borne by the Attorney-General’s Department and not recouped from customer departments, by Treasury direction. Senator Ormonde referred to the coal industry. The Department of Supply is now developing a gas turbine engine in conjunction with the Department of National Development. Progress has been made and it may soon be a commercial proposition. This is one of the ways in which we are endeavouring to help the coal industry.

Senator KEEFFE:
Queensland

.- I would like to draw the Minister’s attention to Division No. 787 where provision is made for the acquisition of sites and buildings. Expenditure last year was $10,756 and the appropriation for this year is $340,000. I hope that the increase is due to provision in respect of buildings at Townsville.

I wish to refer now to the Treasury Minute on the Sixty-Fourth Report of the Public Accounts Committee. At page 10 some criticism is made of the accounting methods of the Department of Supply. I would like to know whether the defects have since been remedied. The relevant paragraph states - . . it appears to us that as we have commented so often in the past with reference to existing procedures where uncertainties exist, a final decision on the need for funds should have been deferred until Additional Estimates were prepared.

In the Treasury Minute on the Sixty-sixth Report of the Public Accounts Committee another reference is made to accounting procedures of the Department. I raise these matters because I believe they are important to the Australian taxpayers. The report states -

We note that steps have been taken to recruit a qualified and effective internal audit staff and that additional instructions have been issued to establishments regarding their responsibility in the matter.

The criticism relates to the costs of maintaining the capacity of factories. I would like the Minister to tell us whether adjustments have been made since the report was compiled.

I believe that the Minister has not effectively answered my question as to why more money is not being spent in Queensland. 1 should like to have more details of the appropriation for Queensland; I think we should have those details. If the Minister prefers, I will submit a question on notice at a future date.

Earlier I objected that big dealers at some disposal auctions were certainly getting favorable treatment and making money at the expense of the Australian taxpayers. I would like to know why this practice is adhered to and whether there is any way it can be stopped. After all, an appropriation of $78 million is not chicken feed. I am not referring to an amount of $50,000 to provide for the painting of the Prime Minister’s portrait. This is valuable taxpayers’ money that is being spent. Admittedly, some of the expenditure is on Government undertakings, but it belongs to Australia.

My only other question in relation to the bookkeeping side relates to provision for incidental and other expenditure in Division No. 773. It is another petty cash item. The Minister has said that he does not have the details. I do not think that is good enough. The appropriation is for $162,000, and last year $163,379 was spent on this item. It may be sufficient for some people for the Minister to say that he does not have the details, but I am not satisfied with that reply.

I also wish to know what has happened to the report for 1966 of the Department of Supply. As Senator Benn said, this is a very important Department. Is it not considered sufficiently urgent to have the annual report here so that we may consider it and the statements it contains in relation to the estimates for the Department, and not have to wait until after the Federal elections later this year? These points are

Important to me and I would like an elaboration on those points that have been skirted around, and answers to the other points I have raised.

Senator HENTY:
Minister for Supply · Tasmania · LP

– I understand that the Department’s report should be ready in about ten days. The Estimates debate usually is held late in October or early in November each year, and in previous years the report has been available at that time.

Senator Keeffe:

– Yes. Last year the report was ready in September.

Senator HENTY:

– Yes. As I have said, in previous years the Estimates debate has taken place either early in October or late in November. The report would have been available this year, too, if the debate had been held at that time, but because of the forthcoming election the debate is taking place earlier than usual. The honorable senator quite properly referred to the comments of the Public Accounts Committee at page 164 of its 64th report and to the Internal Audit Staff. These matters have been attended to. The Internal Audit Staff of the Department is now centrally controlled and is working effectively. The accounts for 1965-66 have passed the scrutiny of the Public Accounts Committee.

Senator WOOD:
Queensland

.- I wish to discuss further the matter brought forward by Senator Benn regarding the siting of so many of the Department of Supply factories in the State of Victoria. Can the Minister say whether it is intended in the future to site factories in some of the other States which have not been so well favoured so far as this aspect of development is concerned? As Senator Benn mentioned, the majority of the factories are in Victoria, although a few are in New South Wales and there is one in South Australia. Will consideration be given to placing factories in the other States in the future? Does not the Minister consider that the siting of factories in Queensland, Western Australia, Tasmania, his own State, and perhaps also in South Australia, would present a very good opportunity for the Commonwealth Government to bring about a more balanced distribution of population throughout Australia?

Senator HENTY:
Minister for Supply · Tasmania · LP

– The matter which Senator Wood and honorable senators on the other side of the chamber have raised is a most important one. As 1 said earlier, at the present time most of our defence factories have been inherited from the war years. I think that because they were sited in particular States during the war they have remained there. I shall give some thought to the matter concerning the clothing factory which Senator Wood mentioned. I thought that it might be possible to have this factory situated in a decentralised area. Then I found that more than 700 seamstresses would be required, and a labour force of that size simply cannot be obtained in some areas. I examined excellent factory premises which were then empty and could have been used for the purpose, but in the area in which they were situated it was impossible to obtain staff of the requisite number for this particular type of factory. That is one of the difficulties. A factory must be located where a labour force of a suitable size is available. The honorable senator, in referring to smaller industries, raised a very important matter and I shall consider it. There may be smaller industries which could well follow the enormous Army installations in Townsville, for instance. We shall keep this matter well in mind.

Senator ORMONDE:
New South Wales

– The matter that I wish to raise, Madam Temporary Chairman, relates to defence research. I wish to give the Minister a chance to reply because I think that the criticism I am about to mention is of a basic kind. I wish to speak about opinions expressed recently by Professor G. A. Bird concerning the research section of the Department of Supply. Professor Bird is Professor of Aeronautical Engineering at the University of Sydney. He has been highly critical concerning what he regards as a basic trouble with the Department. He has claimed that prior to 1940 aeronautical research, although comparatively small in volume compared with that of today, was controlled and operated in the best traditions of research administration and direction. He has explained that in the early 1940’s the setting up of Woomera brought about certain changes, and that an organisation called the Australian Defence Scientific Service was set up within the Department of Supply.

He went on to say that not only did this bring the laboratories more directly under the Commonwealth Public Service Board, but it did other things as well. He suggested that the Public Service Board was not exactly the type of body to control men who are doing research work. Professor Bird said -

One sure way to defeat the scientific spirit is to attempt to direct inquiry from above.

He was referring, of course, to the Public Service Board. He went on -

All successful industrial research directors know this, and have learned by experience that one thing a “ director of research “ must never do is to direct research, nor can he permit direction of research by any supervisory board.

That seems to be the gravamen of his complaint. He is a professor in a field of science and he has said those things about the Department of Supply. I should like to know whether there is any substance in. the opinions ‘he has expressed because in these days when there is a need for scientific research to be on the highest possible level, I believe those to be important criticisms of the Department. 1 know that the Minister already has replied to some of the Professor’s views and that his comments have been reported in the press, but I think that this is an opportunity for him to clear away doubts that may exist.

Senator HENTY:
Minister for Supply · Tasmania · LP

.- Yes, I would like to answer this criticism because it is a matter of great importance. Naturally, I read Professor Bird’s comments with interest. I think it is true to say that in every research establishment there is available a certain amount of money and there are also available certain resources for research. The Department of Supply has been very careful to see that the money available for research and development is channelled, first of all, into projects that are approved. Very often, that does not meet with the approval of a particular scientist who wants to go off on to some aspect of research which he has in mind. Nevertheless, the project has first to be approved. Then, before it is commenced, it must be costed. This is a requirement which we have instituted, and this is where the rub comes between the research scientist and those responsible for the commercial aspects of the Department.

I can well understand a scientist who has a particular project in mind and who wishes to follow certain lines of research in connection with it, finding it a little galling, if I may use that word, in first of all having to get approval for the work and then having it costed. I think that the statement which I made earlier in answer to Professor Bird’s comments covered all the aspects which he raised, although I did not refer then to the matters I have just stated. I do not know how it would be possible to operate a government industry, or a government department, outside the Public Service Board. This activity is directly under the Public Service Board. In a number of cases men are enticed away by huge salary increases. The Department would love to keep these men, but there is a limit to which a department can go. 1 think that is the crux of the matter. I can well understand the point of view of an energetic, keen scientist; but I do not agree with it within the compass of a government department.

Senator BRANSON:
Western Australia

– I refer to Division No. 786 - Other Administrations - Recoverable Expenditure. I emphasise the word “ recoverable “. It is not qualified. The expression is not “ partly recoverable “ or “ partially recoverable “. I am interested to know whether the Department of Supply is a paying agent for the United States of America, the United Kingdom, the European Launcher Development Organisation and others. We start to recoup the expenditure under subdivision 2, in the form of receipts. In the case of the United States of America we finish up $738,000 in debit. Yet in the case of the United Kingdom we recover §230,000 more than we pay out, and in the case of E.L.D.O. we recover $425,000 more than we pay out. My question revolves around the word “ recoverable “ and why we have a large debit in respect of the United States of America and substantial credits in respect of the United Kingdom and E.L.D.O.

Senator HENTY:
Minister for Supply · Tasmania · LP

– The financial arrangements under Division No. 7S6 are that we receive cash in advance from the United States of America, for example; then we spend money and charge it against that advance. I think we have built up a little credit in this respect. We will spend that credit before we apply for another advance.

Senator O’BYRNE:
Tasmania

.- I wish to follow up the remarks made by Senator Ormonde in relation to Division No. 773 - Defence Research and Development Laboratories. I wish to refer particularly to the reply that the Minister gave. He said that in every research establishment only a certain amount of money is available for research. The whole trouble is that the Department of Supply is not a research establishment at all. In my view, these laboratories should not be in the Department of Supply. After all, the very nature of the Department is to supply. The point that Professor Bird was making is that in Australia we have talents, natural assets and factories that can supply things, but the Department of Supply cannot supply brains and people who are gifted for research. In my view, the cavalier way in which the Minister dismisses the claims made by Professor Bird is unbecoming of a Minister of the Crown and of the government of a country such as Australia.

The crux of this problem is that over a period of years we have had a drain of our best brains in, for instance, aeronautical research from this country. In the past year I have become particularly aware of the case of someone within my family who went to the United States of America and was a professor of aeronautical engineering. He did not like the United States. He was in the south and could not stand the colour problem and all the other difficulties that exist there. He came back to Australia. He saw a magnificent advertisement stating that the Department of Supply wanted someone for its research laboratories. He applied for the position, thinking: “ This is it. Australia is going to give me an opportunity to use my talent here.” The reply that came back was to this effect: “ We do not want scientists; we do not want researchers. We want administrators.” The Department of Supply is an administrative department.

Professor Bird has pointed out that all along the line we are wasting our talent and that the Department of Supply is unsympathetic to Australian talent. As he pointed out, Sweden, with a smaller population than that of Australia, is able to maintain research establishments. Holland has been able to encourage talent to come to it. I refer to the Fokker Friendship aircraft, for instance. This small country has been able to divert some of its brains to producing the established work horse of civil aviation. The Fokker Friendship has taken the place of the old DC3 throughout the world. Holland has directed its attention to developing an aircraft industry and is using the brainpower of its scientists and university graduates within the country.

I suggest that the Minister’s reply to this indictment of his Department did not get to the main point at issue. As he said in his reply to Senator Ormonde, he has to see that the money available is channelled into projects that are approved. That is all very fine for the channels that are approved, but they are not necessarily concerned with this aspect of research. We have certainly directed a lot of effort into weapons research, but we have neglected such things as commercial aircraft and crop dusting aircraft. Earlier today we discussed superphosphate and its importance to Australia. Yet we have to import practically all of the aircraft that are used for the very important work of crop dusting. The spreading of superphosphate, nitrogenous fertilisers and the like is a basic part of the Australian economy, but we have not directed research towards the development of crop dusting aircraft, not only to supply our own needs but also to export, as we exported the Jindivik. If the attitude that we should supply only our own needs had been adopted in respect of the Jindivik, we would never have encouraged its development. I believe that this is the point that Senator Ormonde is making. We cannot afford this wastefulness.

If the Department of Supply cannot handle this research - evidently it cannot because it has not a wide enough horizon - then the Commonwealth Scientific and Industrial Research Organisation, the Office of Education or someone else should handle it. It is very important that we use the brains that we obviously have in graduates from our universities. But the position is that people cannot see any scope here for the development of their talents; so they go overseas and help other people there to develop new ideas and make new approaches to various subjects, such as aeronautical research. Then we have to turn around and buy them back. In my view, that is negative economics. I strongly support what Senator

Ormonde said. 1 also believe that we should have a very close look at whether aeronautical research should remain under the Department of Supply.

Senator HENTY:
Minister for Supply · Tasmania · LP

– I should not like the honorable senator to think that the one or two items I mentioned were all the projects that were being undertaken by the Department of Supply. He mentioned the Jindivik. Let me mention that the greatest work that we are doing at the present time is in the production of the Ikara antisubmarine weapon system, which is the largest development undertaken in Australia, and the cost of the version for the British Navy, which has purchased it, is alone of the order of $12 million. Two other countries are interested in the purchase from us of this Ikara weapon. The development started from original research in Australia. Every bit of it has been done in government aircraft establishments in Australia. Every bit of the design, every bit of the manufacture, and every bit of the selling has been Australian. I cannot mention some other matters because they are classified.

Great work is being done by the Department. It has a great number of research establishments. There are the Weapons Research Establishment at Salisbury and the aeronautical research establishment at Fishermen’s Bend. We have a great number of very competent scientists and good design staff at the government aircraft factory where, as the honorable senator knows, we have been carrying out work on the Mirage, including some modifications. This is all the work of Australian designers in the field. In South Australia we see developments in xerography, which we have patented. As a result we are earning royalties from a large number of countries. It does not matter under which department this research work is done. Certain basic funds are available for it, which have to be channelled into fields where they are able to be of the greatest use to Australia. Australian designers are excellent. Some designs are on the boards for certain other things. They have not yet reached a stage at which I can make an announcement to the Senate. As soon as they have reached such a stage, I will be happy to make such an announcement.

Senator MCCLELLAND:
New South Wales

– I refer to Division No. 786 - Other Administrations - Recoverable Expenditure, item 03, European Launcher Development Organisation. This Organisation is referred to also in subdivision 2, which relates to receipts. I know that Senator Branson has already addressed a question to the Minister on this matter but I desire to refer to a question that 1 placed on the notice paper on 30th August last, the reply to which I received on 15th September. It related to the total cost of construction and launching of the Europa I rocket, which was fired recently at Woomera and was in flight for a period of 5 minutes 36 seconds. The Minister stated in reply that the member States of E.L.D.O. contributed to the cost of financing the programme and no financial contribution by Australia was involved. Yet in the Estimates, in Division No. 786, under the heading to which I have referred, we see that there was an expenditure last year of $4,594,050, from an appropriation of $5 million. The appropriation proposed for this year is $3,725,000. Under the same Division we see that receipts are estimated to be of the order of $3,300,000.

The Minister, in his reply to me on 15th September, said in the first instance that no financial contribution by Australia was involved in the cost of construction and launching of rockets under the E.L.D.O. scheme. Then he went on. to say -

The launchings from Woomera cause expenditures not only by my Department but also by each of the member States whose representatives take part in work at Woomera associated with assembling the rockets, testing of equipment, and finally launching the rocket.

The two statements in the Minister’s answer, bearing in mind the Estimates that are before the Senate, do not seem to me to run hand in hand. First there is a proposed appropriation in respect of expenditure. Then there is an appropriation in respect of receipts. The Minister says in the first paragraph of his answer that no financial contribution by Australia is involved and in the second part he says that in addition to moneys expended by the E.L.D.O. countries there is expenditure by Australia involving the Austraiian taxpayers. 1 think that the Australian taxpayers are entitled to know the exact amount that they are contributing to the cost of launching and firing these rockets. The Minister went on to say in his answer -

The Organisation has not attempted to publish information in terms of either cost per rocket or cost per launching.

This seems to me to be a very strange matter when one takes into account the report presented to the Parliament by the Auditor-General, who states at page 170, in relation to this Organisation -

New financial rules adopted by the Organisation provide, among other things, that in collaboration wilh, and, if a member country so desires, in conjunction with, the appropriate authorities of that member country, the auditors of the Organisation may check the proper use of its funds by inspection of that country’s records. In response to a request by the Organisation to the Department of Supply, an audit report has been Furnished to the Organisation’s auditors on the statements of expenditure by Australia on the Organisation’s behalf for the year ended 31st December 1965.

Surely this means that expenditures on matters connected with E.L.D.O. have been made by the Australian Government, despite the Minister’s statement in reply to me that no financial contribution by Australia was involved. In view of the proposed appropriation and expected expenditure of $3,700,000 this year, the Australian people are entitled to know exactly the extent to which the Australian Government is involved in connection with E.L.D.O. I would appreciate an amplification of this matter by the Minister, because the two paragraphs in his answer to me as late as 1 5th September do not seem to be hand in glove with one another, especially when one bears in mind the remarks appearing in the Auditor-General’s report and the Estimates provided for consideration by this Parliament. There ought certainly to be some explanation of the statements made by the Minister.

The other matter to which I wish to refer is the provision for Defence Research and Development Laboratories in Division No. 773. This is a matter to which I referred previously in consideration of the estimates for the Department of Supply, I believe, but certainly in the defence measures which came before the Parliament. I refer to the Australian electronics industry. 1 know that the former Minister for Supply who is the present Minister for Defence (Mr. Fairhall) previously urged reform in the administration and control of radio and television frequency allocation and matters of that sort generally. But as I am sure you, Mr. Temporary Chairman, and the Minister for Supply will appreciate, this is vital to Australia’s defence. This Government has not. given enough consideration to the development of an effective electronics industry in Australia.

I should like to know what plans the Department of Supply has in view, bearing in mind the statement of the Prime Minister (Mr. Harold Holt) in March that negotiations would be taking place with the American authorities for the supply of defence equipment, not only for the Australian forces but also for the American forces. What plans has the Department of Supply for the building up and development of an efficient and effective electronics industry in Australia, to serve not only the civilian needs of Australia but also the defence requirements? I believe that the two matters I have raised are important. The first related to the European Launcher Development Organisation and the second related to the encouragement of a healthy electronics industry which is vital to Australia.

Senator BENN:
Queensland

– I ask for a ruling from you, Mr. Temporary Chairman, in respect of a matter which has come to my notice. At the bottom of page 120 of the Bill the total appropriation for the Department of Supply is stated. At the bottom of page 121, a total appropriation for four departments is stated. It seems that the matters referred to on page 121 are the stray ends of items associated with the departments mentioned. 1 ask for your ruling because there is a matter on page 1.21 which I should like to discuss, if I am entitled to do so, while the estimates for the Department of Supply are under consideration. If I am not entitled to do this, it appears that we shall have to deal with the first matter on page 121 which is under the control of the Department of External Affairs, when we are dealing with the proposed vote for that Department. We shall have to deal with another matter relating to the Department of the Interior when the vote for that Department is under consideration and so on. But you will notice that the total at the foot of page 121 is for “ Defence Services payable from revenue “. I ask for your ruling.

The TEMPORARY CHAIRMAN (Senator Laught:
SOUTH AUSTRALIA

– I rule that the Committee is considering Divisions Nos. 763 to 793 at pages 118 to 120. The total to which the honorable senator has referred covers other divisions. I rule that the only divisions before the Committee are Divisions Nos. 763 to 793 inclusive.

Senator HENTY:
Minister for Supply · Tasmania · LP

Senator McClelland has referred to the provision for the European Launcher Development Organisation as part of recoverable expenditure. He will notice that receipts under this item are set down at $4,858,827 and this amount is about $200,000 more than the appropriation. We work with E.L.D.O. through an advance. We get an advance every month from the Organisation and as expenditure is incurred, it is charged against that advance. These advances go back to 1962 and we have always maintained a small credit in the E.L.D.O. account. We have built up a credit and this year, we will not draw as much against it. The answer that 1 gave to the honorable senator is quite correct. The money is spent by E.L.D.O. We spend it on behalf of the Organisation and then we seek a refund. In the last year we received nearly $250,000 more in receipts than actual expenditure for the year.

Senator McClelland also referred to the electronics industry. This is a very important matter because modern developments in the field of micro-electronics make it essential that every country should have an opportunity to keep its electronics industry up to date. We in the Department of Supply are fully charged with the importance of this matter. We have been endeavouring to work with the Department of Defence, the Department of the Navy, Department of Air and Department of the Army to obtain from them their forward requirements so that we can encourage the Australian electronics industry to undertake the required production in this field. It is a slow up hill battle and the honorable senator might be correct in his statement that we have not done enough. However, the Department is fully charged with the importance of this matter and is pressing on with it. The criticism of the honorable senator might add a spur to us. But by world standards, we are behind in Australia and we have to do everything possible to try to attain world standards.

Senator McClelland:

– This might not come under the Department of Supply.

Senator HENTY:

– I have broad shoulders and will accept the responsibility for the present.

Proposed, expenditure noted.

Motion (by Senator Henty) agreed to -

That consideration of intervening divisions be postponed until after consideration of the proposed expenditure and proposed provision for the Department of Customs and Excise.

Department of Customs and Excise

Proposed expenditure, $17,991,000.

Proposed provision, $73,000.

Senator BENN:
Queensland

.- Now and again, we hear of conflict of authority between some State authority and theDepartment of Customs and Excise in relation to some film introduced into Australia to be shown on television. It has to pass the scrutiny of the Department’s officers. After they have examined it, they refer it to the Minister who, in all probability, then examines it himself and makes a decision. That is the end of the matter. There is no right of appeal from his decision. I am quite satisfied to leave it that way. But we have the situation in Queensland, which still enjoys sovereign powers, that there is a Board which is known as the Literature Board of Review. The statutory duty of that Board is to examine literature that is introduced into Queensland. We know the impediments which surround such a proposition. Although the Board could take action which would ban the sale of a book in Queensland, it could not very well prevent such a book from being introduced into Queensland. That is the odd situation. 1 do know that several conferences were held about this matter. The Minister will have knowledge of them, but I shall mention them. A meeting was held in August 1965. Subsequently, a conference of Commonwealth and State Ministers was held in Sydney on 15th November 1965. A further conference of Commonwealth and State officials was held in Canberra on 1 6th and 17th June 1966, which is not very long ago. Probably the matters discussed then are still fresh in the Minister’s mind. For the edification of honorable senators, the Minister might be so good as to inform us of the matters discussed and to say whether there will be a change in the situation that exists in Queensland at present so far as the Literature Board of Review is concerned. Will the Board be able to give full effect to its decisions in the future? The annual report of the Board for this year states -

During the year the Board issued prohibition orders in respect of six publications.

The document that 1 am holding in my hand cites the publications which have been prohibited since 1954. 1 do not propose to rend them out.

If the Queensland Government believes that certain books are of such a low standard that they should be banned and that they should be prevented from being published or offered for sale in Queensland, it should be allowed to do those things, in view of the State’s sovereign power. But if the Commonwealth allows such books to be imported into other Slates and to be transported to Queensland by rail or by various other ways, I do not see that there is much good in the State Government doing the things that I have mentioned. It seems to me that it would be rather futile for the Literature Board of Review to continue its operations. Perhaps the Minister will have something to say on this matter.

I know that in the past some films have been banned. As a matter of fact. I sat with a Minister for Customs and Excise one night and looked at a film which he informed me he proposed to ban. I told him that I endorsed his action. 1 do not profess to be a purist, but when I look at parts of some of the programmes that are exhibited on television now and again I think it would be almost impossible to get anything lower morally. Nevertheless, they are shown on television. The Minister might be so good as to help me with this matter.

Senator ANDERSON:
Minister for Customs and Excise · New South Wales · LP

– I do not profess to have the ability, in the time available to me, to give a complete exposition of the broad issues involved in this matter. The first thing I should point out is that the Commonwealth exercises its power of censorship through the Customs Act and that that power relates to articles, films and written material imported into Australia. The powers of the Department of Customs and Excise in relation to prohibition operate at that point. Once goods are cleared and released by the Department, the States’ sovereignty operates.

I will take one case in order to simplify the matter. It would be perfectly competent for the Commonwealth to release an imported book, magazine or pamphlet. I will not include films because I do not want to confuse the issue. Then the Queensland Government, for instance, exercising ils own judgment, could say: “ We will not have that particular article in Queensland.” It would be competent for the State Government, through the Literature Board of Review, to give effect to that decision, exercising its sovereignty. The Commonwealth exercises no control over articles originating within Australia. The Customs law is not applicable in those circumstances. The States have complete sovereignty in relation to articles that originate within Australia. That is where the two divisions occur.

Generally speaking, the States have always accepted the decisions of the Commonwealth Literature Censorship Board and also the decisions of the Commonwealth Minister relating to material covered by Item 22 of the Customs Regulations. When we decide to release an article, the States accept that decision as being sufficient evidence of the status of the article. Obviously, if we prohibit the importation of an article the States have no rights regarding that article, because it does no’ come into the country. If it is something that is produced in Australia, the States exercise complete sovereignty.

Senator Benn, in passing, referred to what is going on in this mater between the Commonwealth and the States. I have spoken about this from time to time. A genuine and very sincere effort is being made by the Commonwealth and the States to reach agreement on a degree of uniformity. Following a meeting of Ministers late last year, in June of this year there was a conference of officials to try to sort out the essential problems relating to the

States’ and Commonwealth’s requirements. As I have already indicated, 1 hope to arrange another meeting of Ministers very shortly, lt could be even, next month. It is not always easy to get six State Ministers and the Commonwealth Minister together. We all have our commitments.

I am hopeful that we will be able to come together and. as a result of our negotiations that have been going on over a long period of time, that we will evolve a system of uniformity which will be in the best interests of Australia. I do not want to canvass the conditions that arc inherent in that degree of uniformity because I wish to be free to iron out the details. I am sure that the honorable senator understands my position. Whilst we have a broad sweep of consistency within this agreement on uniformity, there are some minor details which we have yet to resolve. I believe that as the Commonwealth and the States have expressed the desire for uniformity in relation to censorship, this uniformity will come about very shortly. When it does, it will not be to the disadvantage of the Commonwealth nor to the sovereign States.

Senator COHEN:
Victoria

.- I want to pursue briefly the matter to which the Minister for Customs and Excise has just adverted. 1 have been concerned for some time with this problem of uniform censorship. I am wondering what the reaction of the Minister and his Department is when a volume, film or pamphlet is brought into Australia from abroad, passes through the machinery of the Department of Customs and Excise and then is (he subject of action by a State. We are concerned at the moment with the expenditure by that Department, the problem of keeping the staff going and the cost of pursuing and examining material that comes into the country from abroad. Ultimately, the Department has the task of deciding whether this material is or is not to be admitted under a particular regulation. But what is the reaction of the Minister and his Department when, having permitted the entry of material into Australia, they find that one of the States has proceeded to take action, under its own laws, against that imported item?

What I have in mind quite clearly is what happened in my own State of Victoria within the last couple of weeks. A pamphlet dealing with atrocities in Vietnam was permitted to enter Australia by the Department of Customs and Excise. This pamphlet immediately became a subject for action by the Victorian State Police. Apparently, at some stage, authority was given by a magistrate to seize some of these pamphlets. In the end, the public revulsion against the action of the State was so strong, and the view of the State Government was so clearly defied by right thinking citizens that the action was abandoned. What I want to know is this: What is the reaction of the Minister and his Department to this kind of action? We are solemnly discussing here the proposed expenditure for the Department of Customs and Excise. I am dealing with an article that comes through the machinery of the Department. What is the reaction of the Department to independent action taken by a State which, in substance, says: “ We could not care less what the Commonwealth thinks about this item. We propose to take action under our own laws “?

Senator GAIR:
Leader of the Australian Democratic Labour Party · Queensland

– The matter raised by Senator Benn is worthy of discussion by the Committee. A Government that ! had the pleasure to lead in Queensland was responsible for the introduction of the legislation which provided for the establishment of the Queensland Literature Board o; Review. My Government established this Board because it was conscious, as many other people were, of the necessity for doing something to save the young people of our community from the type of literature that was flooding Queensland, in common with the other States of the Commonwealth. We were not unmindful of the difficulties that were associated with our attempt in this connection because of the apparent indifference of other States to take similar action. We were conscious also of the fact that the Commonwealth appeared to be not as vigilant regarding the material that it was allowing to flood into Australia from overseas as we would have desired it to be. I speak not so much of books but more particularly in relation to publications that might be classified as pamphlets and magazines that were emphasising sex not only on their covers but also in their text and pictures.

This opinion is supported by the fact that fewer of the undesirable and sexy type of magazines are to be found on the bookstalls in Queensland than there is to be found on the bookstalls of other Australian capital cities, particularly Sydney and Melbourne. If honorable senators are sufficiently interested in this matter I would suggest that in the course of then- travels in Australia they make a survey of the pamphlets and magazines on sale at bookstalls at airports, railway stations and city bookshops. I say as a parent who has been interested in this matter for many years that I never miss the opportunity of examining the type of literature that is being poked under the noses of adolescents, and in my opinion, there is definitely too much emphasis being given to the female form, couples in compromising positions and half naked women, in the material available to our young people today. 1 have seen material in pamphlet and book form on bookstalls in Melbourne particularly that retailers and wholesalers in Queensland would be fearful of touching because of the existence there of the Literature Board of Review. Retailers and wholesalers know full well that if the stuff was admitted to Queensland and was put on sale, they would be prosecuted as so many have been, particularly in the early years of the existence of the Board. The Queensland Literature Board of Review has proved a great deterrent to the growth of this cancer that exists throughout some of our States today.

Youth movements, church movements and others have been endeavouring to counter this literature with little or now assistance from governments as a whole. I am glad to learn that some attempt is being made, slow as it may be, to bring about some system of uniform control of this rubbishy material that is made available to the young men and young women of our community today and is displayed in too many bookstalls throughout the Commonwealth. I am glad to know that other States are commencing to recognise and appreciate the necessity of doing something. God only knows, we have drifted too far already. Any honorable senator who saw in the television programme “ Four Corners “ last weekend, the interviews with the young people - the go-go girls and the others - their conduct, and the report on their standard of morality, could not help but be stirred into doing something to remedy the position that exists at the present time and, indeed, is growing more rotten every day.

I say very definitely that the Commonwealth has not exercised as much control over this sort of rubbish as it should have done. A lot of it is coming from America and other countries, lt is of no value to us. lt is not doing our society any good. So why have it here and add to the difficulties of our young people? I appeal to the Minister and his administrators to take a more serious view of this problem than they have in the past, to ban the admission of a lot of this material, and so try to save the young people of Australia from its effects. 1 commend Senator Benn for having raised this matter, which is of importance to the future of Australia’s citizens.

Senator ORMONDE:
New South Wales

I am the first to agree that a problem exists in relation to sex education. That is the modern term that is used. The Minister should not be secretive. He ought to tell the Senate what he means by uniformity in relation to censorship. I do not know how uniformity can be achieved on moral issues. Very often one’s attitude to morals is determined by one’s age. The average age of members of the old Literature Censorship Board was approximately 80 years. I should imagine that those censors took a quite different view of moral questions than do the 21 year old go-go girls who are suffering damage because of the failure of the 80 year olds to control what they read. A problem exists in achieving uniformity of censorship. I think that uniformity is impossible to achieve. Senator Gair referred only to the material that comes into the country. He said: “ Keep the rubbish out “. I am in favour of that. But that suggests that no rubbish is produced locally. I should say that ten times as much rubbish is produced locally as comes into the country from abroad.

Senator Gair:

– We are talking only about the admission of material by the Department of Customs and Excise.

Senator ORMONDE:

– I know that. But that does not include about 90 per cent, of the stuff that is available. I would not like to see my family reading it, but I do not know how you can ban it. A problem exists in regard to newspapers. Certain newspapers delve very deeply into the subject of sex. We live in a period of what is called sex education. The churches have another name for it; they call it marriage guidance. I doubt whether the modern youth who goes to the surf side, Kings Cross and various places in the eastern suburbs of Sydney is very much interested in marriage guidance councils and the like. One newspaper in Sydney publishes a column in which correspondence is invited from kids 13 years and 14 years of age who have sex problems. That is a bit early to have sex problems.

Senator Gair:

– Not in Sydney.

Senator Anderson:

– This discussion is getting a little wide of the Estimates.

The TEMPORARY CHAIRMAN (Senator Wedgwood:

– Order! The honorable senator should confine his remarks to the Estimates.

Senator ORMONDE:

– Very well. I am not in favour of controlling what newspapers print. It might be necessary to expose such situations. Nevertheless, there has been a deterioration of morals amongst our young people. The Minister ought to be able to have a conference with the managements of newspapers and television stations about what is moral and what is not, and about what is good material for family reading, listening or viewing. If it is not possible to introduce a law to set a standard for morals, as the Minister suggests is done in regard to imported material, then I think he ought to attempt to have a conference with the managements of newspapers to suggest a line of behaviour in relation to the treatment of these modern problems, particularly as they affect the young people in the community who at 14 years of age are much more sophisticated than probably young people were in my day at 21 years of age. I understand that in the past it has been possible to achieve agreement with the newspapers. The New South Wales Government even altered the law regarding the printing of court news. I believe that if the Minister exercised his influence he could effect a great improvement in regard to locally produced material, in addition to his efforts to achieve uniformity in regard to imported matter.

Senator ANDERSON:
Minister for Customs and Excise · New South Wales · LP

– With your indulgence. Madam Temporary Chairman, the debate has ranged fairly wide. Once we open up this subject, it is very difficult to say where we should stop. Let me say in reply to Senator Cohen that I was ahead of him when he started to state the problem. What I am about to say fits with what I said in reply to Senator Benn. If we get the degree of uniformity that I hope for, the kind of situation that Senator Cohen mentioned perhaps will not occur in the future. Senator Ormonde asked whether I could not be more precise about the kind of uniformity I hope to achieve in discussions with the States. I want to put myself at the mercy of the Senate in relation to this matter. I have been negotiating with the States to get a degree of uniformity, and my predecessor did likewise. Now we are al the threshhold of agreement. I have an understanding with the appropriate Ministers that, when we get to the point where we can make a joint statement, we will do so. Then what we say must stand the test of public opinion and, to the extent that a recasting of regulations is involved, must be approved by six State Parliaments and the Commonwealth. I ask honorable senators not to press me too hard on this point. I do not want to prejudice the chance of success. A tremendous amount of work has gone into our approach to the problem. I assure honorable senators that I hope to be in a position at an early date, together with the relevant State Ministers, to make a joint statement. As I said a moment ago, we are at the threshhold of an agreement which will give a degree of uniformity and at the same time preserve certain sovereign rights.

The comments made by Senator Gair were quite interesting. Of course, they related to the broad sweep of the State’s problems. Two levels of censorship are involved. First, we have works of literary merit that are dealt with by the Commonwealth Literature Censorship Board. Secondly, we have what we refer to as the Item 22 material, which is magazine material that is not of literary merit. That is dealt with administratively by officers of my Department. I have to accept the responsibility for that. That category involves thousands of publications. Honorable senators would be amazed at the quantity that is involved. As a general principle, we take a very hard line with the Item 22 material, which, as I said, is not of literary merit. Matters that have literary merit are referred to the Board. A right of appeal lies to the Appeals Board and to a court if an applicant remains unsatisfied with the procedure.

I say to Senator Ormonde that I have a tremendous task as Minister for Customs and Excise. I have great problems with literary censorship and ordinary censorship. Please do not invest me with the responsibility of telling the Press and radio stations what standards of good taste should be observed. I think that is their responsibility. Any organisation which conducts a big newspaper or chain of newspapers has a responsibility to judge the standards of morality of the times. 1 believe that in the long run it can be left to the good sense of those organisations. If it is necessary for someone to call them to order, I do not think it is a job for the Minister for Customs and Excise.

Senator O’BYRNE:
Tasmania

.- I wish to raise a matter which, perhaps, is as delicate and debatable as that which has just been raised by honorable senators on this side of the chamber. 1 refer to the censorship of information and material coming into Australia relating to international affairs, mainly for television programmes. This year the departmental heads referred to the Minister for Customs and Excise (Senator Anderson) a television film on the war in Vietnam, the commentary on which was given by Michael Charlton. At the time the Minister was visiting Western Australia. The film had been shown by the British Broadcasting Corporation. Unfortunately, at the time the film was forwarded to the Minister he was involved in an accident. 1 must say how very pleased 1 was to hear of the rapid recovery of the Minister and his wife from the accident. However, the result was that a decision on whether the film was suitable for exhibition in this country could have been delayed for a considerable period of time.

I believe that, a department of high repute such as the Department of Customs and Excise, with its various consultative powers in respect of film and literary censorship, should have authority delegated to it in circumstances similar to that I. have described. It smacks of the ridiculous that a film should have to be forwarded across this vast continent for a Minister’s personal viewing. Somebody in the Department should have delegated to him by the Minister authority to make final decisions. The instance to which I have referred was not an attempt to smuggle in subversive typepropaganda. The film came from the British Broadcasting Corporation, a source which is well known in this country. The commentary on the film was by a man whose reputation is on the highest plane. It was a great loss to Australia when Michael Charlton left to go overseas. When shown by the British Broadcasting Corporation the film evoked criticism. Any film on hostilities in Vietnam will create controversy in the Press or in television and radio programmes. It may raise the ire of some sections of the community, but if we are to be a mature nation and to achieve the objects that the Department of Customs and Excise has in its keeping, a much more clear cut policy should be laid down. Freedom of thought, freedom of . speech and freedom of worship are the important objectives at which we aim.

I can sympathise with the situation of the Minister. He was in hospital at the time when he should have been viewing the film which had to be sent across to him in Western Australia. For all but two weeks of the year, the Minister would have been in the eastern States. 1 understand the circumstances, but I believe that it unduly reflects on the Department that the procedure had to receive the full glare of publicity because the Minister’s authority under the present system had not been delegated to perfectly responsible people for a decision to be made.

I viewed the film in a “ Four Corners “ programme. It was a colourful film which tried to penetrate the truth of the horror of the Vietnam war. It was informative and educational, lt did not influence me one way or the other but it was rather an anti-climax after all the hoo-ha and hullabaloo that had gone on for a week, lt proved to be a normal type of educational film about which any junior member of the Department could have said: “ The B.B.C. showed it. It is on a controversial level. Some people will disagree with it and others will not “. That is the nature of Michael Charlton’s technique. He seeks out controversial topics. He is not afraid to enter a controversial field. I believe that the question of film censorship should be examined so that a repetition of the farcical situation I have described may be prevented.

Senator ANDERSON:
Minister for Customs and Excise · New South Wales · LP

– 1 would like to reply now to the matter raised by Senator O’Byrne because I was personally involved in the unfortunate affair.’ I want to say very shortly to Senator O’Byrne that the Chairman of the Commonwealth Film Censorship Board has to form an opinion in terms of the regulations. In this instance, he sought my advice as Minister in relation to his opinion before he gave his judgment. He is perfectly entitled to do that.

I was due to travel to Albany on the Monday of the week in which the film was sent to Perth. I was to spend the day there on Tuesday and to return to Perth on Wednesday night. Normally there might have been an excuse for saying: “ I will look at the film when 1 get back to Sydney on Friday “. However, in the spirit of attempting to expedite procedures, I instructed that the film be sent to Western Australia so that 1 might view it in Perth on the Wednesday night, even though I would not be returning to Perth until 6 o’clock or 7 o’clock that night. I said that I would then give a decision. In the event, I was involved in an accident on the return journey to Perth. My wife and I, Mr. Willett. my secretary, the driver of my car, the driver of the other car in the accident and his little daughter were all admitted to hospital. The film was brought back to Canberra to be viewed by Mr. Hasluck on my behalf. Advice was tendered to the Chairman of the Board and the film was released. Had the original programme proceeded according to plan, showing of the film would have been delayed by three or four days which, in terms of film releases, is not regarded as a very long time.

Senator McClelland:

– It gave the film a good rating, though.

Senator ANDERSON:

– I have no doubt that it succeeded in getting a magnificent audience for the film. However, the accident was a sad affair for all the people involved in it, and it was a most distressing time. The film was sent to Western Aus tralia only because I was trying to facilitate the handling of it. Normally, I would have said: “ I will see it as soon as I get back to Canberra or Sydney.” Generally speaking, I think that the Film Censorship Board does an excellent job in a very difficult area.

Consideration interrupted.

The TEMPORARY CHAIRMAN:

Order! In conformity with the sessional order relating to the adjournment of the Senate, I formally put the question -

That the Temporary Chairman do now leave the Chair and report to the Senate.

Question resolved in the affirmative. (The Temporary Chairman having reported accordingly) -

page 546

ADJOURNMENT

Stevedoring Industry - Phosphate Fertilisers - Drug Industry

The DEPUTY PRESIDENT.- 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.

Senator CANT:
Western Australia

– I am loath to detain the Senate, but I wish to bring to the attention of honorable senators a Press statement made by Mr. McM’ahon, who was then Minister for Labour and National Service, on 22nd July 1965. The minister stated -

Mr. A. E. Woodward of the Victorian Bar has accepted my invitation to undertake an inquiry into the stevedoring industry. Mr. Woodward will commence the inquiry as quickly as possible.

The terms of reference of the inquiry were then set out. Their effect was to establish Mr. Woodward in the somewhat judicial position of inquiring into industrial matters as they relate to the waterfront.

On 29th July 1965, Mr. D. G. Poulter, the Secretary of the Stevedoring Industry Inquiry, stated the matters into which Mr. Woodward would be inquiring. He did not state all the terms of reference but he mentioned those which he thought called for the most urgent consideration by Mr. Woodward. So, we have Mr. Woodward at that period in the capacity of a judge conducting an inquiry. Then, in the “ Australian “ of 15th September 1966 we find it reported that Mr. Woodward is appearing as an advocate before Conciliation Commissioner T. C. Winter in the margins inquiry. Therefore, the Department of Labour ‘and National Service, which is the responsible body in regard to both the inquiry on the waterfront and the matter before the Conciliation Commissioner, has placed Mr. Woodward in a completely impossible position. 1 do not make any attack on Mr. Woodward. 1 am quite satisfied about his honesty and integrity. It is the Government which has placed him in the impossible position of having to appear before the Conciliation Commission and advocate matters of the kind into which he is inquiring on the waterfront. I propose to outline some of those matters. The case before the Conciliation Commissioner involves an inquiry into whether margins should or should not be adjusted. The first matter into which he was to inquire in connection with the waterfront was the effectiveness of the labour force, including such matters as the operation of the gang system, rostering, methods of working hatches, the use made of workers suffering disabilities, and work customs or practices affecting cargo handling rates. Therefore, the first matter into which Mr. Woodward was to inquire is associated with the fixation of margins.

Mr. Woodward was also required to inquire into the use made of workers with special skills. It has been reported that in the margins inquiry Mr. Woodward stated, in addressing the Conciliation Commissioner, that job evaluation would enable assessments to be made of the skill and responsibility involved in each job as well as work features. So, there is a complete line up in that respect. The next matter into which Mr. Woodward was to inquire on the waterfront was supervision, including the role of job supervisors and foremen. Before the Conciliation Commissioner he advocated the responsibility of the worker in supervising or instructing assistants and in preventing loss or damage to equipment, tools and materials and products.

On the waterfront, Mr. Woodward was to inquire into cargo handling rates, including the reasons for increases or decreases in rates for particular types of cargo. Before the Conciliation Commissioner, Mr. Woodward is reported to have said that he believed that one of the techniques used in job evaluation should be applied during the investigation. This would enable assessments to be made of the skill and responsibility involved in each job as well as work features such as dampness, dust, noise, fumes and cramped conditions. Those are conditions which are to be found in the holds of ships and are the kinds of things that attract different rates of pay for the various cargoes that are handled. On the waterfront he was required to inquire into the composition of the work force, including the consideration of age distribution and physical fitness of the work force, and pension proposals. Before the Conciliation Commissioner he is reported to have said that the assessment of skill would involve such factors as the mental and physical demands of the work as well as the basic education, experience, training and degree of initiative and ingenuity required. Finally, he was required to inquire into bonus or contract payments, including consideration of alternative methods of linking earnings to productivity. All of those are involved in the issue into which the Conciliation Commissioner is inquiring in the margins case. 1 think it is time that the Department of Labour and National Service had a look at this situation. It should avoid placing a person in such a position because no matter how honest a man may be or how great his integrity, if he is required to appear in such a dual capacity there may be no end to the damage that that does to industrial relations. The Government is always saying that it is concerned with industrial relations and that it wishes to have peace in industry in Australia. 1 suggest that the easiest way to destroy peace in industry is to have people acting in a dual capacity, in one instance adjudicating on what the workers should receive and in another instance advocating what they should not receive. I ask the Minister to inquire into this matter.

Senator PROWSE:
Western Australia

– This afternoon, in speaking to the Phosphate Fertilisers Bounty Bill I quoted figures relating to rises in the cost of raw materials, and there was an implication that the rise in prices for manufactured superphosphate was excessive. The prices for raw materials quoted were those supplied to me shortly before preparing my notes. I had overlooked the fact that the periods to which the comparative rises applied did not exactly coincide. The big jump in superphosphate prices occurred on 18th July when, in New South Wales, prices rose by $3.10 and in Western Australia by $3.50, but the quoted prices for phosphate and sulphur applied, as stated, to the 1965-66 period and would not have revealed fully the rises in the cost of materials which prompted the rise on 18th July. 1. did not have available to me the details of the materials cost rises that resulted in the latest cost rises. I regret that, in the form in which I presented the figures, an inaccurate conclusion could be drawn from them. I take this opportunity to put the record straight.

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

– 1 wish to bring before the notice of the Senate the completely unwarranted, unjustified, deliberately inaccurate and spiteful attack made by the Commonwealth Director-General of Health, Sir William Refshauge, against the drug companies of Australia. As the “ Australian “ pointed out, the Department of Health for some time has been carrying on a war against the drug trade. The Director-General, in my opinion, has been abusing his position in using his report to further his private hate of the trade. Last year he attacked the doctors and this year he attacked the drug companies for the Department’s own failure to keep pharmaceutical costs within limits. Having been rewarded by his masters, I expect that it is quite understandable that he should be subservient to them in not attacking the very people who are to blame for the rising costs; that is, the members of the Government themselves. The blame rests squarely on them for their political decision to enlarge the range of drugs made available. The Government authorised the additions and then, in effect, it blamed the doctors for using them. I just wonder ‘how stupid we can get.

The implications of the Director-General’s snide attack were apparently deliberately inaccurate in order to foster the Department’s hate campaign against the competitors of the Government’ own drug organisation - the Commonwealth Serum Laboratories. The Director General implied in his report that there was one detailer for every five to six general practitioners. That is a deliberately false number. That would mean that there are only 6,000 to 7,000 general practitioners in Australia. He for gets to add that the detaillers have to cover many thousands of physicians as well. He also deliberately forgets to mention that the 1,200 detailers represent at least 60 companies. Does he deny the right of each drug company to have its own detailer. Does he deliberately forget to add that these detailers have to visit chemists, hospitals, veterinary surgeons, etc.? In fact, in Tasmania for example, only one detailer is employed by each company to cover 125 general practitioners, let alone physicians. These figures show what a malicious interpretation the Director-General has given by his figures.

He goes on to make further snide implications as to the gullibility of doctors, who, according to him, are taken in by the detailers. After all, whatever the detailer may suggest, the doctor is the person responsible for ordering the drug. Sir William casts a slur on all of us. But then, of course, he does not really understand general practice. Let me finish by saying that nearly every one in this chamber owes a debt of gratitude to one or other of these drug companies. So do not let us keep on disparaging them because they make large profits. Of course they make money. So do the Broken Hill Pty. Co. Ltd. and General Motors-Holden’s Pty. Ltd. But at least the drug companies, for the welfare of the community and the benefit of all of us, plough back some millions of dollars each year in research.

Admittedly, some errors have been made. But, as has been pointed out so well, if penicillin were to have been discovered today it would never be marketed because of its many side reactions and deaths. If the cost of drugs is high, let us remember that they are relatively cheap when viewed from the point of view of the national economy. Four or five dollars worth of penicillin could well be the equivalent of the cost of two or three weeks absence from work if penicillin had not been used. Let us remember that more than four million people of working age were alive in 1961, who would not have been alive if the 1935 death rates had continued. That was the year when the drug explosion occurred. All I want to ask is: Is this not a cheap price to pay for expensive drugs? Another group of costly drugs that have been made available by research has made it possible for two-thirds of patients admitted to mental hospitals to be discharged in less than 12 months, instead of being in hospitals for years. So these drugs are well worth their cost. I think the Minister for Health (Dr. Forbes) should ask his Director-General to apologise.

Senator ANDERSON:
Minister for Customs and Excise · New South Wales · LP

– I will certainly refer the comments made by Senator Cant to the Minister concerned. I have no doubt that the Minister will communicate with or reply to the honorable senator. I consider that the Senate is indebted to Senator Prowse who, finding that something that he said on a certain subject this afternoon could have been subject to misunderstanding, took the first opportunity to clarify the point that he was making. As the Minister in charge of the Bill that he was debating, I certainly appreciate his sense of proportion in doing that. I am sure that I speak for all honorable senators when I say that.

Senator Dame ANNABELLE RANKIN:
Minister for Housing · Queensland · LP

[10.45]. - I listened to the remarks made by Senator Turnbull. As I represent the Minister for Health (Dr. Forbes), I shall bring them to his notice.

Question resolved in the affirmative.

Senate adjourned at 10.46 p.m.

Cite as: Australia, Senate, Debates, 20 September 1966, viewed 22 October 2017, <http://historichansard.net/senate/1966/19660920_senate_25_s32/>.