26th Parliament · 1st Session
The PRESIDENT (Senator the Hon. Sir Alister McMullin) took the chair at 1 1 a.m., and read prayers.
– My question is directed to the Leader of the Government. Is he aware that the Australian National University Liberal Club has condemned the use of personal smear tactics by the Treasurer in the Capricornia by-election campaign?
– I have read closely what the Treasurer said in the Capricornia campaign and, of course, I deny at once any suggestion of a smear by the Treasurer. The position was made perfectly clear in a statement by the Treasurer to the Press a couple of days after his visit to Rockhampton, and I am sure all honourable senators are fully aware of what the Treasurer said. The statement was not a smear in any way.
– Has the Minister representing the Minister for Civil Aviation seen a report that doubts have arisen in aviation circles as to whether Qantas Airways Lid will go ahead with plans to buy the supersonic Concorde aircraft? Can the Minister say whether a reported rise in the estimated price is the cause of such doubts? Can the Minister also say whether in the event of Qantas not purchasing the AngloFrench Concorde it will consider purchasing the new Boeing 7477
– The matters raised by the honourable senator are really departmental in the sense that they come within the ambit of the Qantas organisation. Nevertheless, I will direct the question to the Minister for Civil Aviation in another place, and if there is any information available T will see that it is conveyed to the honourable senator.
– Has the Leader of the Government seen a statement in this morning’s Sydney ‘Daily Telegraph’ attri buted to Mrs Zara Holt who, I understand, is the wife of the Liberal Prime Minister of Australia, in which she said that she could shake Queenslanders because they are so foolish? Does this reflect the attitude of the Liberal and Country Parties to Queenslanders and Queensland?
– I read the comments of the Prime Minister’s wife with a great deal of interest. I was glad to note that she, like myself, is a great admirer of the State of Queensland and of the Queensland people. She made quite clear the high regard in which she holds the Queensland people and the wonderful possibilities for development in that great State. I find myself in complete accord with her comments in that respect.
– I direct my question, which is divided into three parts, to the Minister representing the Minister for Air. Firstly, is it correct that when the decision was made to equip the Royal Australian Air Force with Mirage aircraft the total number of such aircraft was to be 100? Secondly, how many of these aircraft have actually been put into service up to the present time? Thirdly, in view of the statement of the Minister for Air in another place that the total destruction of four of these aircraft and the partial loss of another two does not constitute an unduly high wastage rate, what is the estimated number of Mirage aircraft which will be fully operational and available for service when the programme has been completed?
– Order! That question will go on the notice paper.
– Mr President, I can supply an answer to one section of it. 1 know that the number of aircraft that have been delivered is 76. The total number to be delivered is 100 fighters and 10 dual trainers. Eight of these trainers have yet to be delivered. The total delivery will be 110. If the rest of the question is placed on the notice paper the Minister representing the Minister for Air can obtain the information required by the honourable senator. 1 thought that I should let him know those particulars al once.
– I ask the Minister for Housing: Has a staff arrangement been introduced in both the homes savings grant section and the war service homes section of the Department of Housing whereby senior clerks in those branches have to submit monthly reports to their superior officers on the appearance of their junior officers, their diligence, conduct, attitude and other matters generally relating to their employment? Is the Minister aware that the introduction of this staffing system has created dissatisfaction and concern amongst junior officers of the Department? Will the Minister agree that it is possible that an unfair and biased report could be submitted against a junior officer who, because of the confidential nature of toe report, would be unaware of its contents and who, subsequently, could be prejudiced in his future employment in the Commonwealth Public Service? What are the reasons for the introduction of this system? If it is to be persisted with and an- adverse report is submitted against any officer, will the Minister ensure that this fact is brought to the notice of the particular officer thus giving him or her the opportunity to refute the allegations?
– I do not know of the matters that have been raised by the honourable senator. I will be pleased to discuss them with the Head of my Department. But I wish to say in reply to the question that I think everybody in Australia will recognise the most excellent work that is done by officers in the sections of the Commonwealth Department of Housing mentioned by the honourable senator, that is, the war service homes section and the homes savings grant section. Those officers, I believe, are doing very excellent work in dealing with these matters which are, of course, of a beneficial nature to a great many people. I believe that the officers in the homes savings grant section, to which young people come for advice and assistance, are providing a very special service. I will take up with my Department the matters raised by the honourable senator and make inquiries concerning them.
– My question is directed to the Minister for Supply. It refers to a statement that he made last week offering Commonwealth assistance in the establishment of industrial capacity to produce micro electronics defence equipment. I ask the Minister: What form of administrative facilities or consultations with industry or State representatives are proposed in order to develop this capacity? Can representatives of South Australian industries with a potential capacity expect regularised discussions with the Minister to meet these objectives outlined by him?
– The administrative side of this matter is open to any industry. We would welcome any South Australian industry, which felt that it had possibilities for development in this field but would need some assistance, to discussions with the relevant section of my Department on the subject. The matters about which the honourable senator asks are administrative questions which I think would be better discussed between the industry concerned and my Department. But I wish to make it quite clear to him - I am sure that he can relay this to any industry that approaches him - that any industry is welcome to come and discuss any problem that it has with my Department or to raise any need it may have in order to help with development. Each case will be considered on its merits.
– I ask a question of the Minister representing the Minister for Immigration. In view of the arrival last week in Australia of the first Ambassador from Yugoslavia, does the Minister anticipate the early signing of a migration agreement with that country?
– I will take that matter up with the Minister for Immigration.
– Order! Once again I draw the attention of honourable senators to the asking of questions. I have had a series of complaints from listeners - not mat we are bound by mat - about questions which are asked of Ministers who represent Ministers in the other place and which it is impossible for them to answer. All that Ministers in this place can do is to ask that the questions be put on the notice paper. This is doing a lot of harm to our question time. Questions that are put on notice are not rebroadcast later in the day. There is not much point in asking involved questions of Ministers who represent Ministers in another place, and honourable senators would do just as well to put them on notice.
– When I came here and when the late Sir William Spooner was the Leader of the Government in the Senate and the late Sir Shane Paltridge was the Deputy Leader, Ministers used to familiarise themselves with the portfolios which they were representing.
– I rise to a point of order, Mr President. The Leader of the Opposition is canvassing your ruling, and I cannot tolerate that.
– Order! I will let him go for a while.
– Is not it the duty of Ministers in this chamber who represent Ministers in another place to familiarise themselves with the general outline of those other portfolios and to be prepared to answer questions in general even though not in detail?
– Order! Ministers have the right to reply to questions in whichever way they care. But if an honourable senator asks an involved question about which a Minister could not be expected to- have any information it is quite impossible for that Minister to reply. I am pleased that the Leader of the Opposition is concerned about the practices of the House. They have received rather a mauling during this week.
– I would like to comment on what the Leader of the Opposition has said. Ministers in this chamber familiarise themselves, to the greatest possible extent, with the portfolios which they represent, but very often questions are asked which involve detailed information which could not be within the knowledge of Ministers. Questions are asked about policies which cannot be commented on because responsibility for them lies with Ministers in another place. In those circumstances I think that your comments, Mr President, were very well chosen.
– My question is addressed to the Minister representing the
Prime Minister and by way of preface, I remind him of a question that I asked him recently. Since it was not suggested that it should be placed on the notice paper, I ask it again. Several weeks ago I asked the Minister about the possibility of the Government giving recognition to the memory of that illustrious member of the staff of the Monash University, Professor Jock Marshall, for his services to the cause of conservation. I now ask: Is the Minister in a position to indicate what the Government’s ideas are on this matter?
– I have no information from the Prime Minister. I understood that the question was put on the notice paper, but if the honourable senator has not placed it on notice I suggest that he do so now so that it can go directly to the Prime Minister.
– Can the Minister for Customs and Excise say whether the proposed establishment of censorship boards and committees in New South Wales will have any influence on uniform censorship?
– I imagine that this question arose because of action that was taken in the New South Wales Legislative Assembly yesterday. The State legislation will not prejudice the impending arrangements between the Commonwealth and the States. My reading of the reports indicated that the New South Wales Government, concurrently with doing certain things to put itself in a position where it will be in agreement with the new arrangements, included certain other provisions in the legislation covering State responsibilities in this field. Very properly, the reports referred both to Commonwealth and State relationships and State activities. In truth, the two things are separate but apparently provision for both has been included by the State Government in the one piece of legislation.
– I address a question to you, Mr President. In view of the dissatisfaction to which you have referred with question time in the Senate and the dissatisfaction which has been expressed to me, and I am sure to other honourable senators, by members of the public, would you consider asking the Standing Orders Committee to examine the Standing Orders as they relate to questions in order to see whether it is possible to recommend any reforms?
– I think that is an excellent idea, and I shall be pleased to refer the matter to the Standing Orders Committee.
(Question No. 257)
asked the Minister representing the PostmasterGeneral, upon notice:
– The Postmaster General has supplied the following answer: 1 and 2. The following table shows allocations of overseas exchange which I am informed have been authorised during 1965-66 and 1966-67 for the purchase of television programme material. Statistics are not available for payments to individual countries. However, the undermentioned payments to the sterling area and non-sterling area would be predominantly for material of United Kingdom and United States origin respectively.
(Question No. 274)
asked the Minis ter representing the Minister for Civil Aviation, upon notice:
– The Minister for Civil Aviation has supplied the following answers:
(Question No. 280)
Minister representing the Postmaster General, upon notice:
– The Postmaster General has supplied the following answers: 1 and 2. All advertising is subject to the programme standards laid down by the Australian Broadcasting Control Board, but there are no standards applying specifically to the advertising of cigarettes.
(Question No. 299)
asked the Minister representing the PostmasterGeneral, upon notice:
– The Postmaster General has supplied the following answers:
Senator WEBSTER ask the Minister representing the PostmasterGeneral -
Does the present method of zone charging for telephone calls discriminate against people in areas removed from State capital cities?
Is it a fact that such an imposition reacts against the proper distribution of population throughout Australia?
Will the Minister review the system with the object of introducing a more equitable method of charging for the Department’s services?
– The Postmaster General has supplied the following answers:
The telephone zone charging system, of which ELSA (extended local service areas) is a part, is one of the main basic features of the Community Telephone Plan for Australia which was adopted as Government policy on 1st May, 1960.
The basis of the zone charging system, which is an essential step towards the ultimate objective of a fully automatic nation-wide network an objective shared by all progressive telephone administrations is the grouping, on a community of interest pattern of exchanges into zones which, in turn, are grouped to form districts. Under this arrangement, local call access is available between exchanges in the same and adjoining zones, thus enabling subscribers to make local calls over much greater distances and to many more subscribers than formerly.
The system also permitted the adoption of a simpler charging basis for trunk calls. These charges are now based on the distance between the centres of zones in the case of relatively short distance calls and, for longer distance calls, on the distance between the centres of districts.
ELSA has been of particular benefit to country subscribers because their local calls were previously restricted to subscribers whose services were connected to the same exchange or to other exchanges within a fivemile radius, representing, in effect, a local service area of slightly less than 80 square miles. Under ELSA, however, the size of rural local service areas was increased, on an average, to about 800 square miles. As a result, approximately 45% of calls on which country subscribers had been required to pay trunk rates for each three minutes’ conversation became un-timed local calls.
(Question No. 302)
asked the Minister representing the PostmasterGeneral, upon notice:
– The Postmaster General has supplied the following answers:
(Question No. 305)
asked the Minister representing the PostmasterGeneral, upon notice:
Has any further consideration been given by the PostmasterGeneral’s Department to a request by the Geelong Promotion Committee, made in September 1966, that data processing operations of the Department be decentralised and a punch card section established in Geelong, where ample suitable labour is available?
– The Postmaster General has supplied the following answers:
The need for future decentralisation of data processing activity in the Department is and will continue to be constantly reviewed as systems and procedures are extended beyond the developmental stage.
Decentralisation of this important activity will generally be influenced by the location of originating sources of data, the facility of transporting data from the point of origin to the transcription unit and the availability of labour for the processing work.
At the present time and in the immediate future source data will be restricted to the metropolitan areas of Sydney and Melbourne. In these circumstances early decentralisation to provincial centres is not required and could not be justified at this time.
(Question No. 310)
asked the Minister representing the AttorneyGeneral, upon notice:
– The Attorney General has supplied the following answers:
(Question No. 314)
asked the Minister representing the PostmasterGeneral, upon notice:
– The Postmaster General has supplied the following answers:
New South Wales - Blowering, Chatsbury, Corroboree Flat, Dyraaba Creek, Gulf Creek, Hogarth, Janina, Laughtondale, Orama, Pappinbarra Junction, Peel, Pokataroo, South Yalgogrin, Teridgerie. Tobin, Upper Cooperabung, Uriarra Forest, Yorklea.
Victoria - Arnold West, Burnbank, Cobungra, Morrell’s Hill, Rose River, Tostaree. Turton’s Creek, Yambuna.
Queensland - Boortkoi, Clayburn, Clifton Beach, Coomrith, Endeavour, Fredericksfield, Granite, Mount Fox, Nut Grove, Talgai.
South Australia - Taragoro.
Western Australia - Bendering West, Boodarockin, Karlgarin North, Koolanooka, Kunjin, Lake Grace North*, Lake Grace South, Mordetta, Multewa North, Pintharuka, Rosamel, Toompup, Waddington.
Tasmania - Nil.
New South Wales - Baldwin, Bogee, Bombay, Brewer, Brooman, Buddigower, Clarence, Cloud’s Creek, Couragago, Culmnran Creek, Dalman, Dalmortan, Davis Creek, Gleniffer, Greenfield Farm, Home Rule, Hunter Springs, Millingandi, Mount Rivers, Peak Vale, Porter’s Retreat. Rockvale, Rules Point, Tallow-wood Point, Thilloo, Urisino, Watson’s Creek, Yannergee, Yarrangobilly Caves.
Victoria - Nil.
Queensland - Anduramba, Antil Plains, Cootharaba, Evandean, Glenhope. Gunjulla, Logyard, Milbong, Mission Beach South, Nome, Noorlah, Orion, Risenshine, Tuen, Victoria Hill*.
South Australia - Charra, Courela*. Hayes Creek, Kopi, Johnburgh, Makin.
Western Australia - Beela, Borderdale, Bulagin Rock, Chinocup, Elverdton, Jilakin, Kybellup, Nembudding, Parryville, Wilgoyne.
Tasmania - Nil.
At centres marked thus (*) the exchange was subsequently re-opened.
The Department endeavours to maintain a measure of service in the districts concerned by adopting the following course of action:
– On 16th August the Leader of the Opposition (Senator Murphy) asked without notice whether the Government would consider holding a public inquiry into the needs of aged persons in our society.
Each year in its Budget the Government makes known its social services proposals for the current financial year. These are only decided upon after an extensive review of the social services items which come within its orbit of responsibility. As a matter of practice, of course, this review is a continuing process, although special reviews have been made in recent years aimed at discovering any particular need for improvement of benefits in certain areas of social services. Following these reviews the Government introduced important measures including the provision of additional assistance for pensioners who pay rent, single pensioners and all classes of pensioners with dependent children. It must also be remembered that decisions in relation to the social welfare programme must always be made in the light of the many other calls on the Government’s financial resources and the position of those people who are most in need of additional relief. The Government’s decisions for the current financial year were made against this background and accordingly the Government could not support a proposal for an additional public inquiry in this field.
Motion (by Senator Henty) - by leave - agreed to:
That leave of absence for one month be granted to Senator Cotton on account of absence overleas.
– 1 have received message No. 77 from the House of Representatives dealing with the appointment of a committee to consider the erection of a new and permanent Parliament House. The communication has been circulated to honourable senators.
– by leave - I move:
I ask for leave to make a short statement on this matter.
– -There being no objection, leave is granted.
– Honourable senators will recall that the proposed Committee was first constituted during the life of the last Parliament. With the dissolution o( that Parliament, the Committee ceased to exist before its work had been completed. The Government’s purpose now, as it wau then, is to ensure that the views and Interests of both Houses will become known and can be taken into account before plans are drawn up for the building of the new Parliament House.
The resolution from the House of Representatives is in the same terms as the earlier motion, except that it gives the new Committee power to consider and make use of the minutes of evidence and records assembled by the previous committee.
The question of the site of the new Parliament House has not been made one of the formal terms of reference. I repeat the assurance given to the previous Committee by my predecessor; that any member or members of the Committee will, in the Committee’s report, be free to make such observations on the question of the site as he or they may desire.
Question resolved in the affirmative.
Bill received from the House of Representatives.
Standing Orders suspended.
Bill (on motion by Senator Henty) read a first time.
– I move:
That the Bill be now read a second time.
At the Premiers Conference held in June it was decided that, for purposes of determining the financial assistance grants payable to the States in 1967-68 and future years, the special assistance of $5m paid to them in 1966-67 should be treated as part of that year’s ‘formula’ grants. This Bill is designed to give effect to that decision. The financial assistance grant payable in any year is arrived at by increasing the grant tor the previous year in accordance with a formula which takes account of increases in population and in average wages together with a betterment factor of 1.2%. Thus, the formula grant received in the previous year provides the base on which the formula operates for determining the grant in the following year.
If, as is now proposed, the special assistance of $Sm paid last year is incorporated in the base amount on which the formula will operate for 1967-68, this will lead to an increase of $5,400,000 in the financial assistance grants for the current year. Moreover, the benefit to the States will not be limited to the current financial year as the base amounts on which the formula will operate in subsequent years will be higher than they would otherwise be.
As honourable senators will be aware, these financial assistance grants finance about one-half of State budgetary expenditures, excluding operating expenditure of State business undertakings. Thus they have an important influence on the level of State expenditure, which includes expenditure on such vital State government services as education and public health. The Government is fully conscious of the need to ensure that the States have access each year to sufficient revenue to enable such services to be expanded in line with the growing needs of the community. As the financial assistance grants are now determined by means of a formula which virtually ensures that they will increase at a faster rate than the economy as a whole, it is clear that these grants are making an important contribution to growth. In recent years, State expenditures have been increasing at a faster rate than total national expenditure. This strong increase in State expenditures would appear to reflect not only a rapidly increasing usage of State services but also some improvement in the standard of services. Of course, we all would like to see further improvements in the standards of State services, not least in such fields as education and public health. However, there are obviously limits to the extent to which resources can be devoted to some activities without adversely affecting other activities. In this respect, the recent rapid growth in Commonwealth assistance to the States and in State expenditures is all the more remarkable in view of the fact that it has occurred at a time when we have been allocating a significantly increased proportion of our resources to defence.
As I have mentioned, the present measure will have the effect of further increasing the revenue available to the States. I might remind honourable senators that this follows the two measures to assist the States which were agreed at the Premiers Conference held in February 1967. At that conference it was decided, firstly, to provide in 1966- 67 the special assistance of $5m which it is now proposed to incorporate in the formula grants and, secondly, to reduce the time lag before increases in average wages are reflected in the grants. As a result of these two measures, the grants to the States in 1966-67 were $11,800,000 greater than they would have been otherwise. Because of the reduction in the wages time lag, it is much more difficult than previously to make a reliable estimate of the grants which the formula will produce. However, the current estimate is that the 1967- 68 grants will be just over $900m. This would be $73,500,000, or nearly 9%, greater than the combined total of the formula grants in 1966-67 and the $5m special assistance paid in that year.
I commend the Bill to honourable senators and with the concurrence of honourable senators I incorporate in Hansard the following table which gives details of the grants to individual States:
Debate (on motion by Senator Murphy) adjourned.
Bill received from the House of Representatives.
Standing Orders suspended.
Bill (on motion by Senator Henty) read a first time.
– I move:
That the Bill be now read a second time.
The purpose of this Bill is to amend the Sales Tax (Exemptions and Classifications) Act to provide a number of new exemptions and to alter the sales tax classification of certain classes of goods. Our industrial and scientific development creates a steady flow of new products and new techniques that could not be foreseen when many of the existing exemption and classification provisions were incorporated in the sales tax schedules. A review of these schedules has revealed a need for some adjustments to sales tax exemptions and classifications. This Bill is therefore designed to effect various alterations that are considered necessary in the light of technological and other developments.
Among the new exemptions are several that will benefit persons engaged in primary Industry or in the handling of primary produce. This group of exemptions includes gas welding equipment for use in agricultural industry, machines for grading, sorting and cleansing vegetables and equipment for canning butter. Exemption is also to be provided for refrigeration equipment for use in the preservation of eggs by poultry farmers, egg marketing authorities and persons who grade and store eggs on behalf of egg marketing authorities.
Cranes and winches fitted to tractors used in the timber-getting industry in the hauling of log timber have long been exempt but this exemption has not applied to cranes fitted to other types of motor vehicles used in similar operations. Cranes and winches fitted to motor trucks are new being used in many forest areas for the hauling and loading of logs. It is therefore proposed that cranes and winches for attachment to motor trucks should be exempt also.
Other exemptions will assist the Australian film industry. A wide range of imported films has for many years been exempt from sales tax but comparable Australian made films have been subject to tax. This Bill will remove this disadvantage to the Australian film industry by providing a uniform exemption for practically all motion picture films other than advertising films and those filmed by home movie makers. Further assistance to the industry will be provided by way of exemption for a wide range of equipment, including cinematograph cameras and sound recording and film processing equipment, used by professional film producers. Optometrists are to be placed on the same footing as medical practitioners, dentists and physiotherapists as regards exemption of instruments and equipment used in their sight testing activities.
At present there is a limited exemption which applies to fork-lift trucks used in certain stevedoring operations. The exemption is applicable only where the fork-lift trucks are for use partly in shipboard cargo handling activities. This exemption is to be widened to cover those fork-lift trucks for use only on wharves, provided that they are to be used exclusively or primarily and principally in the handling of cargo in the course of loading or unloading ships.
The classifications of some household articles will be affected by the proposed changes. These include candles which are to be taxed at a uniform rate of21/2% in common with other household lighting appliances. This will involve the withdrawal of the exemption of plain wax candles and a reduction in rate on other candles. The rate of tax on household incinerators is to be reduced from 121/2% to 21/2%, and a similar reduction is proposed for household articles of pewter which are now taxed at 121/2%. Pewter ware will thus be taxed at the same rate as silver-plated ware.
It is proposed that the rate of tax on tape recorders and tape players should be increased from 121/2% to 25%. There has been a noticeable trend towards the use of tape recorders and tape players to provide musical entertainment. In time, tape recorders and players may well displace the conventional record players which are now taxed at 25%. It is therefore proposed that tape recorders and tape players should be placed in the same sales tax bracket as record players. The increase will not, however, affect office dictation machines or other appliances designed primarily and principally for the recording and reproduction of speech. These will remain taxable at 121/2%. A similar increase is to be effected in the rate of tax on tape recordings of music or other entertainment that are produced for sale or lease. These tape recordings will accordingly be taxed at the same rate as disc records for radiograms and record players which bear tax at 25%.
Photographic equipment and photographs are in general taxable at 25% but 35 millimetre photographs, including transparencies mounted in slides, have been taxable at 121/2%. This came about because photographs in the 35 millimetre sizes are produced on film which is identical with cinematograph film. As a consequence they came within the scope of a provision designed to exclude motion picture films from the field of photographic goods taxable at 25%. This exclusion was never intended to apply to still photographs. This Bill will rectify the situation by placing still photographs and transparencies of this particular type in the 25% rate class with other still photographs.
Vinyl floor tiles have previously been exempt under a provision originally drafted with the object of exempting various classes of building materials such as ceramic tiles. Other floor coverings, including linoleum tiles, rubber tiles and cork tiles, are taxed at 21/2%. Vinyl floor tiles are now to be taxed at the same rate.
During the war years, car covers made from cloth weighing less than 10 oz per square yard were coupon goods under the rationing system applicable to clothing, drapery, piece goods and soft furnishings. The goods which had been on the coupon scale were subsequently exempted from sales tax and, as a result, the light weight car covers were brought within the field of exempt goods. Although marketed as car covers, many of those in the smaller sizes are suitable for use as beach sheltersand they are regularly purchased with this end in view. Beach shelters and car covers made from heavier cloth are taxable at 121/2%. In the interests of consistency, exemption of the light weight car covers is to be withdrawn so that they also will be taxable at 121/2%.
I do not propose to discuss all of the amendments included in the Bill. Those I have mentioned are, I think, sufficiently illustrative of the adjustments that are to be effected by the Bill. Details of other alterations are set out in the summarised statement of sales tax amendments that is being circulated. A memorandum explaining the clauses of the Bill is also being made available to honourable senators. The amendments are effective from 16th August 1967. A loss of revenue will result from some of the amendments, while others will bring in additional revenue. The net result overall will be an increase in revenue estimated at approximately $1.5m per annum. I commend the Bill to the Senate.
Debate (on motion by Senator O’Byrne) adjourned.
Bill received from the House of Representatives.
Standing Orders suspended.
Bill (on motion by Senator McKellar) read a first time.
– I move:
That the Bill be now read a second lime.
The purpose of this Bill is to increase repatriation war pensions for the children of ex-servicemen whose deaths have been accepted as due to war service, as announced by the Treasurer (Mr McMahon) in his Budget speech. The Bill therefore provides that for children who have lost one parent through war service the weekly pension will rise by 50c to $4.40 for the first child, and by 50c to $3.25 for the second child and other children. Where both parents are dead the weekly pension will rise by $1 to $8.15 for each child. The Bill also appropriates the Consolidated Revenue Fund to the extent necessary to provide during the current year the additional benefits to which the Bill gives effect. It is intended that the Act will come into operation from the date of assent, and the increased pensions which it provides will be payable on the first pension pay day after that date. J commend the Bill to the Senate.
Debate (on motion by Senator Bishop) adjourned.
That, unless otherwise ordered, the Divisions of proposed expenditure be considered in the following order:
Department of Supply, $85,726,000
Department of Education and Science, $49,197,000
Department of Education and Science, $10,638,000
Department of Customs and Excise. $19,787,000
Department of Customs and Excise, $85,000
Repatriation Department, $273,859,000
Repatriation Department, 584,000.
Department of Housing, $4,510,000
Department of Housing, $45,500,000
Prime Minister’s Department, $22,425,000
Prime Minister’s Department, $778,000
Department of Trade and Industry, $18,288,000
Department of Trade and Industry, $11,000
Department of the Treasury, $347,346,000.
Department of the Treasury, $12,147,000.
Advance to the Treasurer, $20,000,000.
Advance to the Treasurer, $20,000,000.
Department of National Development, $33,549,000
Department of National Development, $43,987,000
Commonwealth Scientific and Industrial Research Organisation, $31,700,000
Commonwealth Scientific and Industrial Research Organisation, $1 , 420,000
Attorney-General’s Department, $12,913,000
Department of External Affairs, $48,924,000
Department of External Affairs, $13,110,000
Department of Defence, $17,816,000
Department of Labour and National Service, $9,584,000
Department of Labour and National Service, $21,000
Administration of the National Service Act, $1,006,000.
Post Discharge Resettlement Training, $2,000
National Service - Vocational Training Scheme -Technical Training, $30,000
Department of Territories, $102,133,000
Department of Territories, $7,075,000
Department of Civil Aviation, $48,654,000
Department of Civil Aviation, $7,390,000
Department of Shipping and Transport,
Department of Shipping and Transport, $37,705,000
Commonwealth Railways. $19,761,000
Commonwealth Railways, $14,000,000
Postmaster-General’s Department, $341,164,000
Postmaster-General’s Department, $240,000,000
Broadcastingand Television Services,
Broadcasting and Television Services, $8,583,000
Department of Works, $48,991,000
Civil Defence - Repairs and Maintenance, $22,000
Civil Defence - Buildings, $30,000
Department of Works, $64,215,000
Department of the Interior, $46,464,000.
Department of the Interior. $62,044,000.
Civil Defence, $723,000
Department of Primary Industry, $37,492,000
Department of Primary Industry, $3,867,000
National Service - Rural Occupations - Reestablishment Loans and Vocational Training Scheme, $17,000
Department of the Navy, $193,132,000.
Department of the Army. $366,102,000.
Department of Air, $297,711,000
Department of Health, $22,112,000
Department of Health, $3,424,000
Department of Immigration, $44,638,000
Department of Immigration, $4,643,000
Department of Social Services, $27,099,000
Department of Social Services, $832,000
I ask for leave to make a short statement.
-(Senator Drake-Brockman).- There being no objection, leave is granted.
– Honourable senators will have noticed that in the particulars of proposed expenditure for this year there is no separate Part 3 for the appropriations for the Territories. These appropriations are now shown under the relevant departments in Part1 of the document. This change is in accordance with the policy of classifying expenditure as far as possible on a departmental basis. It is in line with action which was taken in previous years to incorporate the ‘Miscellaneous Services’ section and the War and Repatriation’ section within the appropriations of the controlling departments. The policy is, in part, a result of recommendations made by the Public Accounts Committee and the present change has been agreed to by the Committee.
The rearrangement will not cause any loss of information because the Territory items retain their present identity although they are now located in Part 1. The receipts and expenditures for each of the Territories are shown in the summary tables attached to the Budget Speech. The change should facilitate our parliamentary debates as it will now be possible for all appropriations of a department to be considered together.
Question resolved in the affirmative.
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 take note of the proposed expenditure’.
Department of Supply
Proposed expenditure, $85,726,000.
– My remarks relate to Division No. 763 which covers proposed expenditure for the Department of Supply. I am concerned about the matter of uniformity because I find that accounts of appropriation and expenditure are almost uniform and I do not understand how this comes about. Every item on the page shows the appropriations with expenditures just immediately below it. Whether it is done from force of habit or whether it is a method adopted by the Department to ensure that it receives more money than it needs, I do not know, but in all cases more money has been appropriated than has been expended. That is possibly a convenient way of doing business but to me it could indicate carelessness. Surely some appropriation and expenditure should be even at times, but not always. Perhaps this custom has grown up in departments in a period of prosperity. I could not imagine that this kind of behaviour would be adopted if we were facing budgetary difficulties.
I have been a member of the Public Service and I do not like to criticise it because it has my greatest respect, but I must say that when I was in the Service I was hurried up when Budget time approached to spend surplus money. It was the sign of a very careless public servant if he had a surplus of funds just before Budget time because that meant that he would not receive so much next time. When we are handling public funds we must be more careful than normally would be the case. There is so much uniformity in these amounts that it is almost habitual for departments to arrange things that way. I do not suggest dishonesty, corruption or anything like that; things are just done that way. If the Minister has an explanation perhaps he will give it to me.
– It shows good estimating.
– ‘Estimating’ is a very loose word. I do not know the solution.
I should like to refer now to item 02 which relates to salaries for temporary and casual employees. This deals with the administrative section of the Department of Supply. ‘Administrative’ to me means skilled men - those who know their business. They administer the affairs of the whole Department. I think that they should be more accurate in giving their figures. I do not want to tie the Minister down on this figure but, over the years, about $923,000 has been involved in payments for temporary and casual employees. The amount has always been approximately that figure. Why is it necessary for the Department of Supply to have temporary and casual employees? Do they not become permanent employees? Is it necessary to have casual employment? In the last three or four budgets, much the same figure has appeared in respect of this item. I think that this is just a regular pattern that has been formed. It ought not to be so.
I wish to make another remark about employees. Far be it for me to criticise men getting jobs in the Public Service, but it does seem to me that the employment rate in the Public Service is always growing. Is not the Public Service installing labour saving machinery? Employment in private industry is not growing. It might be growing in a national sense, but employers are not inflating the number of employees in their businesses because they are using labour saving devices. Even the Post Office is doing this. But other Government departments do not seem to be doing so. They are introducing modern methods such as electric typewriters and computers. But the employment figures for the Commonwealth Public Service are growing all the time. The Minister might be able to explain to me whether this is because of our added activities and our new development. I respect the business abilities of Senator Henty. I know that he is one Minister who has a good business background and understands these things. But I do not know why we are not getting in the Public Service the advantages from these innovations that private firms can show as a result of the introduction of these methods in their businesses. The Minister may be able to tell the Committee why these increases in employees has taken place.
I notice that travelling and subsistence expenses have risen. I believe that there are often many ways by which to save money in this regard. I have studied the budgets presented over the last three or four years and the same figure is stated every time for travelling and subsistence expenses. There are never any savings.
I turn now to the annual report of the Department of Supply for the year 1966-67. I congratulate the Minister for Supply on the production of this booklet. It is a very fine production. The Minister is to be commended for having it available in time for honourable senators to read it in conjunction with the discussion of these estimates. But the report does not refer to what are the deficiencies in the Department of Supply. There must be deficiencies of some kind in the Department because over the last 12 months it has been the subject of most violent criticisms in the newspapers in relation to the Woomera Rocket Range, defence, aircraft purchases and the high and spiraling costs of equipment. Yet, nothing appears in this document about those matters because that is the bad side of the picture. I think that the Department ought to give us some news about what is happening in this regard. The newspapers have been filled with frightening articles about the deficiencies of the Department of Supply. In this document we do not find any information on those matters.
I know that in this report the Department is dealing with its accounts. Might I stray from the item under discussion to express a point of view. I know that we have auditors. I know that great care is taken regarding these accounts. But I remember well what happened when Professor Bland became chairman of the Parliamentary Public Accounts Committee. He really gave it teeth. Only recently I have been reading a little of the report of the Ad Hoc Committee of Inquiry on the Post Office. Sir Giles Chippindall, who was then chief of the Post Office, and other top men in the Post Office came before the Committee. This report ought to be compulsory reading for all members of die Parliament. I think the inquiry was conducted back in 1952. The present Public Accounts Committee is only a shadow of the Committee that was presided over by Professor Bland. The present Committee has Mr Cleaver as its Chairman. We have read about him in the newspapers. I am not saying anything about his ability. We have members of our own Party on the Committee. Only recently Senator Fitzgerald and Mr Cope raised the lack of supervision over spiralling costs and that sort of thing. I agree with them. But over the years the Committee has not been effective. I ask the Minister whether its powers of reference are wide enough.
– They have not been restricted.
– The Committee does not seem to be operating properly. It certainly is not operating in the way it did when Professor Bland was the Chairman.
– The terms of reference have not been changed.
– I think that something should be done to give the Committee more teeth. I do not think it is sufficient that the Auditor-General’s Office should verify that a document is right. The Public Accounts Committee, to be of any value, should have authority to moye round and have a look at departments. It should not wait until something happens or something is disclosed in the newspapers. It should be ready to go to any department to see how things are working.
– The Committee does this now.
– No, it does not
– What the honourable senator sees in the newspapers is usually a report of the proceedings of the Public Accounts Committee. This is where the newspapers get their news.
– But the Committee does not make the news. I do not think that the Public Service is as perfect as all that. What I said earlier about departments is absolutely true. They have to get rid of the money allocated to them; otherwise they are left with a surplus at the end of the year. That might be right, but then again it might not be right. The Public Service might have got into bad habits and perhaps these bad habits keep getting departments into trouble.
I want to thank you, Mr Chairman, for giving me the leeway in which to discuss this matter. I know that it was a little outside the ambit of the estimates under discussion. I would like the Minister to explain to me why the pattern has developed where the expenditure is always less than the appropriation. It might be that the departments or the powers that be state a certain sum. It might be that departments receive an appropriation of 15% more than they need. I would also like the Minister to explain the powers of the Public Accounts Committee to me. Are they wide enough? Would it be wise to give the Committee more power? I would also like an explanation about the casual labour employed in the administrative section- of the Department of Supply.
– I should like to make a suggestion which I think ought to be applied to all departments. It is that we incorporate in Hansard, before the debate on the department concerned commences, details of the estimates which are being considered, together with the schedule of salaries and allowances setting out the persons who are employed.
– For this department, would that involve setting out pages 165 to 168?
– Yes, and pages 303 and 304. The purpose of this is to make it more convenient for honourable senators reading the report of the debates and for students and other members of the public who may be interested in reading the report of the debate on the various estimates. This is a very important debate, but it loses its value to those reading Hansard when they cannot see to what reference is being made.’ I suggest that this method be given a trial for this year. It might mean a little more printing, but it would add greatly to the value of the record of the debate. I make that suggestion, subject to whatever administrative and printing problems may arise. If necessary, I would ask leave that the matter concerned be incorporated and that this be done with relation to each item.
– I think that the incorporation of whatever information is needed to make Hansard a more coherent document would be of advantage in the debate on the various estimates.
– I should like to say that I believe that the proposition Senator Murphy has put to the Committee has a good deal of merit in it. If the Committee agrees I shall take the matter up with Hansard. I stress, however, that there may be certain technical difficulties connected with adopting the suggestion. Nevertheless, I shall make inquiries of Hansard. Is it agreed that details of the Estimates be incorporated in Hansard?
Honourable senators ; Yes.
– Mr Chairman, is it possible for you to speak a little louder so that we may hear what is being said. What Senator Murphy said was inaudible to me. I just did not hear it. Nor did I hear what you said. Could we have both statements repeated so that we may know exactly what we are doing?
– Senator Murphy suggested that the estimates with which we are dealing at this moment be incorporated in Hansard.
– I thought it was a general suggestion relating to all departments.
– Quite true. He went further and suggested that as we proceeded with the Estimates day by day the relevant pages should be incorporated in Hansard. My reply was that I thought the suggestion had a great deal of merit in it and, with the concurrence of the Committee, I would take the matter up with Hansard, but I reminded the Committee that there might be technical difficulties associated with carrying out the suggestion.
– All I wanted to say was that I would invite you, after consulting with Hansard, to make a statement to the Committee, and I suggest that you then give us an opportunity of commenting.
– Is it the wish of the Committee that I take the action suggested by Senator Murphy?
Honourable senators - Yes.
– Senator Ormonde referred to Division 763 which deals with salaries and allowances, temporary and casual employees and extra duty pay. He pointed out that for some of these items there was an over appropriation for the year 1966-67. In reply I point out that the total of those three items showed that the actual expenditure for the year was a little greater than the amount appropriated. The expenditure on these three items was $7,506,557 and the amount appropriated was $7,489,000. As the honourable senator will see, there was over appropriation particularly in respect of payments for extra duty. If he looks at the figure for salaries and allowances he will find that the situation was the reverse. When dealing with a sum of money of that size and estimating an appropriation for a year to come it is not easy to predict the exact amount required. I would say it would be almost impossible. None of this expenditure can be undertaken without proper action. Safeguards are provided. All of these expenditures come under the scrutiny of the Auditor-General and the Parliamentary Public Accounts Committee. Therefore I think all payments are protected.
The honourable senator also mentioned travelling and subsistence expenses. Expansion of Departmental activity and the provision of funds for the transfer of personnel to Canberra have influenced the appropriation under this heading for this year. The transfer has necessitated the increased provision and the segregation of the department’s central office and the Victorian regional office. As the honourable senator knows, the central office of the Department of Supply is being transferred during this year and next year to Canberra. Canberra will be the headquarters for Commonwealth wide administration. We are setting up a separate office for Victoria. Travelling expenses associated with this move call for the increase this financial year.
I noted with some concern that the honourable senator said there had been violent criticism of the establishment at Woomera, the production of aircraft and so forth. I think that a great deal of concern has been expressed in the Press about the future of the joint British and Australian project being undertaken at Woomera. This is a partnership arrangement between the Australian Government and the British Government. The agreement we had has run out but has been renewed for one year while representatives of the two countries meet and plan the future work for Woomera. It is pretty clear that the Woomera establishment will be busy until 1970-71 on work now in progress. I think that the Press and other people have expressed concern about what will happen after 1971. It is fair and understandable that they should be anxious, as we are ourselves. But this is a matter for consultation between the British Government and ourselves on the joint project. The head of the Department of Supply and other officers are to leave Australia tomorrow for London in order to hold further discussions with the British Government about the future of Woomera and the Weapons Research Establishment at Salisbury. They will discuss the research and development which stem from that great institution, the Weapons Research Establishment, and the amount charged to the Australian account and the amount charged to the British account.
The honourable senator also asked whether we were considering the adoption of innovations within the Department. As a business man I assure him that this is one of the things which has impressed me about the Department’s undertakings such as the government aircraft factories and the munitions factories which are spread throughout the Commonwealth. A certain amount of capital is allocated to those factories each year. I find that the factory managements are very alert, as is the Department, to the latest development in plant and equipment and are using every endeavour to bring the factories up to date so that costs are comparable with those in private industry. I was very interested to hear the comments made by Mr Roy Mason, the Minister of Defence for Equipment in Great Britain, when he came to Australia. We gave him an opportunity to visit a number of our organisations and factories. He told me that he was particularly interested in seeing two of them because he considered that for their size they were as up to date as any in the world. We have within the Department a management services group which continually examines our procedures. We are not afraid to call in outside consultants if we feel that we need their advice in this field. We have a vast number of committees on which there are representatives of various industries and these assist us in carrying out the work of the Department. I am not suggesting that we are perfect. We are not, of course. None of these huge organisations throughout the world is perfect. But I would like the honourable senator to know that we adopt a responsible approach and constantly keep such matters under review.
The honourable senator referred to the increasing number of staff employed by the Department. This matter has worried us because although the increase has not been large it has been continual. But we are assuming new reponsibilities. For instance, the tracking stations and the other innovations throughout the Commonwealth are making a vast difference to the work of the Department and call for additional staff. But this matter is being constantly reviewed.
The honourable senator also spoke about aircraft production. I should like him to know that the Department is responsible for the production of the Mirage and the Macchi aircraft which are part assembled and part manufactured in Australia. I was pleased to see that we are up to date with the delivery of the Mirages and within the cost estimate which we gave almost 4 or 5 years ago. Production of the Macchi trainer is just getting under way on the production line. This is an Italian aircraft. As an example of the modern industrial management techniques being used within the Department of Supply, I point out that industrial engineering man hours on the production of rifles have been brought down from 80 hours to 26 hours, and that the clerical work measurement and the internal audit system adopted is the most effective that is possible to attain. Also, we recently established computers in our Weapons Research Establishment and this was leading development in this field. I am not claiming perfection because it would be foolish to do so but this is a very responsible Department and it keeps the questions raised by the honourable senator under review.
– I want to refer to Division No. 763 which deals with salaries and allowances. My question is very brief. I take it that the increase projected for this year has been brought about by normal salary increases plus the small increase in staff to which the Minister referred a few moments ago. But I want to be a bit more specific about one or two other items. Before I do so I would like to thank the Minister for sending me an early copy of the annual report of the Department of Supply. I castigated him severely last year because the annual report was not ready when we discussed the estimates for this Department.
– I remembered the honourable senator’s remarks.
– We will get on very well in the next year, if I again receive an early copy. I cannot see any reference to an office of the Department of Supply at Townsville. If there is a reference to it perhaps he will tell me when it will come into full operation. The items that I want to query in particular relate to travelling and subsistence. I notice that there is a considerable increase in projected expenditure for this year, but in fact last year the expenditure was some $10,000 below the expected expenditure. My colleague, Senator Ormonde, raised this matter but I was not particularly satisfied with the answer given by the Minister. I do not think the Minister gave enough detail.
The sum of $75,000 is provided for freight, cartage and packing in the administrative expenses of the Department of Supply. Is this expenditure tied up with the expenditure to which I have referred or does it cover a whole series of other items? Again there is a considerable difference. The actual expenditure last financial year was $46,369. The expenditure expected for the present financial year is $75,000, which is quite a big jump. I would like the Minister to supply a little more detail on training of personnel which is referred to in the same item. There has been a considerable reduction in the expenditure, from nearly $299,000 last year, to an expected expenditure this financial year of $192,000. Who precisely is receiving the training referred to? I wish to refer now to the proposed expenditure in relation to disposals expenses. Last year $144,380 was expended and the expected expenditure this financial year is $150,000. The appropriation for the current financial year is the same as it was for the previous financial year. I would like the Minister to give me details of how these moneys are expended. Last year I asked a question about incidental and other expenditure under this same heading. Last year the expenditure was $169,764. This year it is expected to be $153,000. I criticised the accounting system of the Department for the unexplained petty cash amount in the previous year. I was not satisfied with the reply that I received on the last occasion or on the occasion before that when the estimates of this Department were discussed. 1 want to refer to the expenditure on Mirage aircraft and to refer in particular to a statement made by the Minister on Tuesday when he said that the number of Mirages which had crashed was no more than could be expected. If six commercial airlines crashed in the same period there would be an uproar in this country. It is perhaps just by good airmanship that six pilots have not been killed. I do not think the Minister’s answer in relation to that matter was satisfactory. I believe that the Senate should be given more information about it. In relation to the guided missile Ikara it appears that the Government is proceeding with the construction of this type of weapon. The annual report of the Department of Supply for 1967 states:
The current missile will be phased out next year, and a new version with improved performance will be introduced. Advanced planning and procurement for this are now well advanced.
I believe that the Australian public wants to know what the Government intends to do in this regard, particularly as the Minister for the Navy (Mr Chipp) on 24th August 1967 said that the Government intends no longer to install this type of weapon in the Daring class destroyers. He said:
The change in plan for the Darings will result in a saving of over $20m in the total cost of the project, and approximately a year in the operational availability of the two ships. This work will be done at the Navy’s dockyard at Williamstown, Victoria.
If the Government continues to introduce new versions of the missile which will have improved performance and the Navy, in cutting down defence expenditure, slices off $20m by not installing the weapons, what is the point? If the Government is cutting down defence expenditure purely for export purposes I think that the public should be told. I will not have time to refer to all the matters to which I wanted to refer in this discussion, but I hope that I will be given another opportunity later.
The report of the Auditor-General has some strange figures and statements in connection with the Department of Supply. I wish to refer now to the matter of reserve stocks. In this respect the Auditor-General stated, at page 229:
The acquisition of additional stocks to meet growing defence needs caused an increase in expenditure of $792,910.
I cannot find any information on what the stocks are nor why they have been accumulated. I think the Senate should be given such information. I now refer to Division No. 776 - Central Transport and Storage Authority - Vehicles and equipment. The Auditor-General states that the increase of $247,172 was due to the purchase of a greater number of vehicles in 1966-67 as additions to and replacements for the transport fleet. What type of vehicles were these and to what particular department were they supplied?
I wish now to refer to the aircraft factory at Fishermen’s Bend. According to a recent Press report the Government intends to spend more than $lm to provide new hangars at Amberley for the swing-wing bombers if ever they get into the sky and are capable of flying as far as Australia. I assume that the Department of Supply is responsible for the building of the new hangars. I think the Senate ought to be given an authoritative statement of the cost and of what it is proposed to do. Is Amberley to be the only place in Australia where the new swing-wing bombers can be repaired or have some of the minor assembly jobs carried out? If this is so I do think there is an obligation on the Government, and particularly on the Minister in charge of this Department, to tell the Australian people what is proposed. If this large sum of money is to be spent - I am not sure of the exact figure because I have seen two different figures quoted in the Press, but it is certainly well in excess of $lm - will it be the total expenditure? Has it already been provided for in the openended cost estimates of the swing-wing aircraft or does it come under some other heading? If the Government is going to build these new hangars at this base will it have to build new hangars at other bases also?
– I will give the honourable senator some information on this. The construction of the new hangars at Amberley is a matter for the Royal Australian Air Force. This will come under the Department of Air. It has nothing to do with the Department of Supply.
– I am sure that nobody else knows that. I appreciate the fact that the Minister has told me. I refer now to the purchase of a block of ground for the establishment of a new Commonwealth clothing factory. This was acquired during the last financial year at a cost of $334,800. What is the area of this piece of ground that was purchased? Is it some gilt-edged piece of ground in Collins Street or somewhere else? The Auditor-General’s report states that it is at Coburg. I want to know whether that amount covers the foundations for the new factory or some other expenditure that is not disclosed either in the estimates for the Department of Supply or, as far as I can find out, anywhere else in the Estimates. This is public money that is being spent. We all have the right to know what is going on.
– May I suggest that the honourable senator give us a breathing space in which to investigate the matters that he has mentioned already, and that he speak again later?
– I have more matters that I wish to mention. I will adopt the Minister’s suggestion.
– I wish to make a few brief comments on the Department of Supply. I refer specifically to Division No. 763 because my comments relate to broad administration. I say how much I and quite a number of other people have appreciated the special efforts that Senator Henty has made in personally going to manufacturers in areas a long way from our capital cities and pointing out to them the opportunities to tender for various purchases made by the Department of Supply. I have heard words of very warm appreciation from a number of organisations concerned. I believe that this is an appropriate opportunity for me to pass them on to the Minister and to do so in the hearing of other senators. This personal attention to these matters is a very valuable adjunct to the work that is being done. Accordingly I extend my thanks.
Senator Ormonde referred to variations between appropriations and expenditures for 1966-67. As I look at the figures, recognising that the total appropriation under Division No. 763 was almost $9im, the variation of only $55,000 is an indication to me of remarkably good forecasting and estimating of the requirements of the Department. As people who have had the experience of having to estimate their requirements for the forthcoming year will know, it is extremely difficult for any department to be sure of precisely how much it will need. I repeat that a difference of $55,000 between the appropriation and the expenditure of a sum of about $91m indicates to me remarkably good estimating by the Department.
Senator Ormonde referred specifically to his own experience as a public servant in relation to the workings of departments. He referred to a practice of spending the amount of money that is available as the end of the year approaches. Unfortunately, that is a characteristic of all departments in all governments. I have often felt that the position could be improved by the introduction of a policy of permitting a carryover of a percentage of the appropriation. I know that this presents quite a number of problems for the Treasury and that it has been frowned upon whenever it has been mentioned. But that does not deter me from seeing the advantages of it and from trying to overcome the opposition to it.
Unfortunately, all governments, whether they are State governments, the Commonwealth Government or governments of other countries, are faced each year when the budget is being considered by the Cabinet with the problem of trying to make the amount that is available overall serve all departments satisfactorily. I have often said - I suppose I will say it again - that the only time when a member of a Cabinet has no friends is when the Cabinet is discussing the departmental estimates, because every Minister is trying to get as much as he can for his own department. That is good. It is desirable that each Minister should do that. But usually the Treasury comes in and chops back the estimates of all departments. Consequently, the estimating of departmental requirements for expenditure or the estimating of departmental income is a matter of great difficulty. So I again congratulate the Department of Supply on the efficiency of its estimating.
I have no doubt that the Minister will comment, if he did not do so when I was not in the chamber, on another matter raised by Senator Ormonde; namely, a comparison of casual employees with permanent employees. I do not know whether the practice that operates in the Commonwealth is the same as the one that operates in the State of Queensland, where a person may be a temporary employee in a department for a long time - 10, 15 or 20 years. His status is not determined by his period of service. According to my experience, it is determined by his qualifications. It is not possible to appoint an officer on a permanent basis unless he has certain qualifications, but he can be employed on a temporary basis if he has less than the required qualifications for the appointment. I do not think that is altogether good. There should be a different system of classification. There should be permanent employees, underqualified employees and casual employees. Those terms would be more descriptive than the terms in use at present. I thought it might be desirable to make those comments in the light of what Senator Ormonde said.
Senator TANGNEY (Western Australia) and casual employees. I notice that under Division No. 771 - Weapons Research Establishment - the expenditure on the salaries of temporary and casual employees exceeds that on the salaries of permanent employees. I would think that such a research establishment would have to be very careful about the people it employed. Most of the employees in such an establishment would be highly qualified and would not remain temporary for very long. As Senator Morris has just said, some government departments have temporary employees whose service extends over many years. A woman of my acquaintance recently resigned from a Commonwealth department after 241 years of service as a temporary employee. That was quite a long time to be a temporary employee. She was quite well qualified.
– Does not the honourable senator agree that there could well be another classification?
– Yes, I do. I believe that these terms are used too lightly. The term ‘casual employee’ does not mean that the employee is casual anyhow. We do not want casual employees. We want people who are keen and who do not do their work in a casual way. That is something that we have to guard against. In the defence research and development laboratories the salaries bill for temporary and casual employees is more than half the salaries bill for permanent employees.
I am concerned about the contributions to research made under Division No. 773, subdivision 2, item 12. At this time when many scientific discoveries are being made almost every day, we need to keep up to date in our defence research and development laboratories. The allocation last year was $187,000, of which $184,000 was spent. This year the proposed appropriation is $187,000 - the same amount as was allocated last year. I should have expected that amount to rise with the increasing tempo of scientific discoveries. One other matter to which I should like to refer is the work that is done by interaction of the Department of the Interior and the Department of Supply in our State and the contact that we as members of Parliament have with the drivers employed by the Department of Supply. I pay a tribute to the courtesy and responsibility of the men who are in that
Department in Western Australia. I make a plea for employees of the Department of Supply, who do such excellent work and are always so courteous to those with whom they come in contact, to have a bit more of the overtime that is at the present time farmed out to private taxi companies. We are very fortunate to have such men in the employ of a Commonwealth department.
– I should like to refer to one or two matters raised by Senator Keeffe. He has, naturally, always shown a great interest in the Townsville project. [ went to Townsville recently to have a look at this project and I have answered a question in the Senate about it. We have made application to the Public Service Board in relation to the arrangements to be made for staffing an office that we are considering opening in Townsville. When we get the staff we propose to proceed with the development in Townsville of a purchasing office for the Department, particularly in the field of contracting. The staffing arrangements rest with the Public Service Board. As soon as we get this matter settled we can proceed. The honourable senator referred to increases in salaries and staff. The proposed increase in expenditure is the result not only of an increase in staff numbers but also of the increase in salaries resulting from the basic wage increase.
The land at Coburg to which reference has been made is alongside the railway line. It has been purchased for a new clothing factory. I do not think that anybody would dispute the fact that we had to have a new clothing factory. The one in South Melbourne is very old; the sooner we quit it the better. Therefore, I think this expenditure is quite justified. The proposed new building will be considered by the Public Works Committee. The price paid for land in these circumstances is always determined in consultation with the Treasury in the light of Treasury and taxation valuations. The area of the land is about 50 acres. That is as near as I can get to the figure without having the actual plan in front of me. The acquisition was made by the Department of the Interior. That Department also checks values and prices and negotiates the purchase.
– Does this amount represent the cost of the land only?
– Yes. The acquisition price was $334,800.
– There were no improvements; it was just the land?
– That is right. That is the price that was paid for 50 acres of land at Coburg. The honourable senator referred to stockpiling of materials. We are carrying not only the amounts of raw materials that are currently necessary but also stocks in accordance with the principle of what is called production lead time to meet any emergency. We are stockpiling some partly made components to enable production to expand immediately if we are faced with an emergency.
Cars are provided to meet the demand of customer departments. If a vehicle cannot be provided from the Department of Supply pool for permanent hire on the request of a department an additional vehicle is purchased following Treasury approval. The replacement programme provides for a turnover of vehicles on a normal business economic basis after they have completed so many thousands of miles. That is all the information that I have at the moment.
– My remarks will be general but may be taken to relate to Divisions No. 765, 771 and 774. If I am in order, I ask the Minister whether he can say what proportion of the arms and equipment used by our forces in Australia and abroad is supplied by the factories under the control of the Department of Supply and by other Australian works. In other words, what is the approximate cost of supplies of Australian manufacture to our forces?
– The Department of Supply, as stated in its annual report, is one of the largest Commonwealth departments. Therefore, its estimates have to be scrutinised with a great deal of particularity. I direct my remarks first to Division No. 763, which relates to administration. The report of the Department states that it has a staff of some 22,000 employees but the estimates seek provision this financial year for some 8,860 employees, which is an increase from 7,754. I take it that the difference between 8,860 and the figure of 22,000 referred in the report represents employees who are outside the ambit of the Commonwealth Public Service Act. Perhaps the Minister could explain this to me. There appears to be an increase this year over last year of some 1,100 officers in this Department. In view of this and in view of the types of officers concerned we must scrutinise these estimates with a great deal of particularity.
Division No. 771 relates to the Weapons Research Establishment. In this regard I have been perusing the report of Auditor-General. At page 239 he directs attention to the fact that on 10th April last at the Weapons Research Establishment a building valued at $158,354 and departmental plant, furniture and equipment valued at $12,625 were lost by fire. This is certainly quite a substantial fire in anyone’s language in view of the value of the property lost. However, I cannot see any reference to it in the Department’s annual report. The Auditor-General, at page 239 of his report, states that inquiries by the Department are proceeding, but no explanation of the cause of the fire has been given. Perhaps the Minister will refer to it in his reply.
I now turn briefly to Division No. 774 - Munitions Factories - Working Capital. I see that for the first time sums of money have been set aside for working capital for munitions factories. Item 01 relates to an appropriation of $30,000 for payment to the Munitions Filling Factory, St Mary’s, Trust Account; item 02 relates to an appropriation of $450,000 for payment to the Aircraft Factory, Fishermen’s Bend, Trust Account and item 02 relates to an appropriation of $150,000 for payment to the Guided Weapons Repair Facility, St Mary’s, Trust Account. I now direct the Minister’s attention to a reply I received on 26th September, a couple of days ago, to a question I had placed on the notice paper to the Minister for Air (Mr Howson) in another place relating to ammunition supplied by the Department of Supply to the Department of Air. Part of my question was in these terms:
What types of ammunition were delivered by the Department of Supply to the Department of Air in the last financial year and what was the total value?
The Minister replied that 7.62mm cartridges and .22 rimfire cartridges to a value of $24,000 had been supplied by the Department under scrutiny to the Depart ment of Air. But when we compare the total value of the ammunition purchased from the Department of Supply last financial year with the total value of ammunition purchased from other sources we find a great discrepancy. Whereas ammunition to the value of $24,000 was purchased from the Department of Supply, ammunition to the value of $622,000 was purchased from other sources. Indeed, ammunition valued at $519,000 was purchased from France. I raise this matter because I am wondering whether this Department in the event of a real emergency in this country, is geared satisfactorily to supply ammunition to our armed forces. Another point is that although the Department of Supply delivered 7.62 mm cartridges to the Department of Air, cartridges of the same calibre were purchased from the United States.
I turn now to the annual report of the Department of Supply. I have no wish to criticise at this stage; I merely wish to learn whether the Department is effectively geared to meet any emergency. To me it seems incredible that this Department, as the Minister said in the foreword to the annual report, is responsible for the production of aircraft, guided missiles, small arms, ammunition, explosives, marine engines, clothing, etc., to support the Australian Navy, Army and Air Force.
Sitting suspended from 12.45 to 2.15 p.m.
Senator MCCLELLAND (New South Wales) - Prior to the suspension of the sitting I raised a number of matters related to various divisions of the estimates for the Department of Supply. Immediately prior to the suspension I was dealing with working capital for munitions factories. I was mentioning to the Minister an answer that I had received from the Minister for Air to a question that I placed on the notice paper some time ago. On 26th of this month, a mere two days ago, the Minister for Air provided me with information that I think should be repeated. That was that last financial year the Department of Air purchased from the Department of Supply ammunition to the value of $24,171, that the value of the ammunition purchased from France was $519,220, from the United Kingdom $86,500, from Belgium $13,300 - and from the United States of America, including some 7.62mm cartridges, which are also a type of ammunition supplied by the Department of Supply, the value of the purchases was $2,240. In other words, of the total amount of ammunition purchased by the Department of Air in the last financial year, the Department of Supply provided only 3.8%. I am asking the Minister whether, in the event of an emergency occurring in this country, the Department of Supply is sufficiently geared up to provide the Royal Australian Air Force with the type and total amount of ammunition that might be required.
When one considers the figures that have been supplied to me in the answer provided by the Minister for Air and then turns to the annual report of the Department of Supply, one sees that there is every justification for wondering what in fact is going on in the Department of Supply. Under the heading ‘Small arms - SAF’ it is stated that the work for commercial firms is about 10% of the current work load. I take it that the ‘SAF refers to the Small Arms Factory. The report also states that major items in this 10% are golf club forgings, machining of door-closer components and forging and machining of coal and rock picks.
– You can throw them.
– I do not know whether they can be thrown but, bearing in mind the functions set out in the preamble to the report of the Department, I certainly think there is every justification for requiring the Minister to explain this matter.
– What is your worry about it? Is it not enough?
– I am suggesting that the Department should be providing more ammunition to the Department of Air than it is actually providing at the present time.
– - I have that one. What is the worry about page 29 of the annual report?
– What I am saying is that work for commercial firms is about 10% of the current work load and that the major items are golf club forgings, machining of door-closer components and forging and machining of coal and rock picks. The general public are given the impression that expenditure by the Depart ment of Supply is for the purpose of supplying the defence forces with arms, ammunitions, tools and so on, but it is obvious that the Department is conducting itself on a private enterprise basis in that respect. As to ammunition, I have pointed out that only 3.8% of the total purchased by the Department of Air is supplied by the Department of Supply.
On page 31 of the Department’s annual report one finds that the Munitions Filling Factory is undertaking a task for the RAAF. It is the modification of a quantity of 500-lb high-explosive bombs to increase their versatility. In the last paragraph of that section of the report it is stated that buying new bombs from overseas would cost at least ten times as much as local modification and that even to boil out the bombs and refill them would cost at least five times the cost of modification. I am wondering whether the Department of Supply is able to provide ammunition at a cheaper cost than is being charged by overseas establishments and why, of the total amount of $622,000 odd spent by the Department of Air last financial year on the purchase of ammunition only 3.8%, or $24,171, went to the Department of Supply.
– Senator Keeffe referred to the Ikara missile. He stated that the Navy had decided not to fit two of its vessels with the Ikara. That is correct. The Ikara is a very much alive project and about the finest anti-submarine weapon system in the world. We supply it to the Royal Navy, and other countries are interested in it. We are always endeavouring to improve our anti-submarine weapons.
Senator Tangney commented on the contribution to research. She asked why more money was not made available. The item to which she referred provides only for Australia’s contribution to the United States space programme in Australia and grants to universities and other bodies for approved research activities. Our other votes include matters which are much more of a developmental nature and relate to work contracted out to private industry which allows development in new fields.
The honourable senator also asks about the Weapons Research Establishment personnel in the laboratories. There are 2.407 industrial wages personnel provided for in the item to which she refers. The wages personnel are not permanent, and this applies to wages personnel in laboratories.
asked what was the approximate percentage cost of the equipment supplied by Australian manufacturers to the armed forces. The Department of Supply is not aware of the expenditure incurred overseas for the defence departments. I can say that in the last financial year we spent $40m in our Australian factories and arranged contracts with industry in Australia to the value of $200m on behalf of our armed forces.
Reference was made to the employees included in the Schedule. This relates to an estimated staff of 8,860 and represents an increase of 7,000. The balance of the staff is employed in the Department of Supply and in Government factories, and these salaries are not chargeable to the appropriation but to trust funds. Our report refers to 22,000 employees. They are working in factories and elsewhere. The figure of 8,860 refers to staff receiving salaries and allowances as per the Schedule. There appears to be an increase of about 7,000.
asked whether the Department was geared to supply the ammunition needs of the Services. The Department is capable of producing the majority of Service ammunition requirements. However, for some items, the requirements have been insufficient to justify local production. The honourable senator referred particularly to purchases by the Royal Australian Air Force from France. Most likely this relates to the purchase of 30 millimetre ammunition. The settung up .of production capabilities in Australia for this ammunition has been under consideration by the RAAF and the Department of Supply for some time and negotiations are proceeding to obtain a manufacturing licence from the French manufacturers.
Senator Tangney referred to the engagement on overtime of the drivers employed by the Department of Supply instead of using taxis. Drivers do work overtime but traffic demands are not uniform. There are peak periods when it is essential to call for outside assistance. The use of departmental drivers to cope with peak loadings would be very uneconomical. We endeavour at all times not to work drivers beyond a certain number of hours each day because of the risk of exhaustion and so forth. I think that those remarks bring me up to date with the queries other than Senator McClelland’s inquiry. I do not have that information available as yet.
– I want to ask a number of questions following on the remarks of Senator Ormonde in respect of Division No. 771, subdivisions 3, 4 and 5. This Division refers to the Weapons Research Establishment about which the Minister has already commented. There is to be less expenditure this year, particularly in respect of machinery and plant, and buildings, works, fittings and furniture. The reduction amounts to some $300,000. The Minister has made some statements in this place and elsewhere about the decline in activity at Woomera. I would like to know whether he can give us a positive statement about the future of the Weapons Research Establishment and also enlarge upon the Press statement he made about the work being done there for Project Mallard.
He was reported in the Press as having said that work on this project could guarantee a future for a team of experts at Salisbury which might otherwise have to be disbanded. Whilst the Minister has given progressive reports to the Senate I think it is fair to say that the people in South Australia as well as honourable senators from that State are not clear about the future of the Weapons Research Establishment and the five sections that it has at Woomera. What I am seeking from the Minister is an explanation of these reduced appropriations and to which section of the Establishment they will apply.
The report of the Department of Supply for 1967 states that there are five sections of the Establishment. They are the trials wing, the space physics wing, the engineering wing, the weapons research and development wing, and the Woomera range. I would like to know whether the Minister can give us some particulars of the decline, if any, of the work in each of those sections and which of them might survive if any reduction in the work occurs.
Senator CANT (Western Australia) divisions. They are Divisions Nos. 787, 789, 792 and 793. They relate to the property of the Department of Supply. I find that this year $1,200 has been allocated for the acquisition of sites and buildings whereas the expenditure under this heading last year was $335,460. At the same time, under Division No. 789, the amount of rent paid by the Department is rising. Last year expenditure was $269,511 and this year the appropriation is $301,000. Surely the Minister has an explanation of this increase in rental. We are critical of rent paid by all Commonwealth departments. I would like to know why there is to be this increase of about $40,000 for rent this year in view of the acquisition of a considerable amount of property in the previous year.
Expenditure on buildings, works, fittings and furnishings last year was $3,391,704 but this year the appropriation has fallen to $3,250,000. This is a pretty broad heading under which to refer to these matters. Surely there should be a better breakup under this Division in order to give the Committee some knowledge of what is being spent on buildings, works, fittings and furniture. Under Division No. 793 I find that maintenance this year will be about the same as last year. Expenditure last year was $1,874,759 and the appropriation this year is $1,850,000.
– That refers to repairs and maintenance.
– Yes, but I suppose repairs are much the same as maintenance. Whilst that item is remaining reasonably constant I think there is some explanation due to the Committee about the other three Divisions. I want also to refer to Division No. 797 which concerns civil defence, particularly to salaries and allowances paid as per the Schedule. Expenditure last year was $76,354 and the appropriation was $102,800. It appears to me that the appropriation was a long way out in comparison with the actual expenditure.
– The honourable senator is now referring to something which comes under the control of the Department of the Interior. This Division does not come under my Department.
– This Division comes within the extimates for the Department of Supply although it is stated that it deals with 1 1758/67 - .9 - f401 matters under the control of the Department of the Interior. These matters do, however, come within the portfolio held by the Minister.
– Order! We are not dealing with Division No. 797. We are only with Divisions up to Division No. 793.
– I want to deal with Division No. 763 Subdivision 2, item 03., which covers postage, telegrams and telephone services. The expenditure under this heading for 1966-67 was $312,709. The proposed expenditure for 1967-68 is $446,000. An additional $132,000 approximately is to be spent just on this one item. I realise that some of the increase may be due to the new postal charges, but $132,000 seems to be a large increase in expenditure on postage, telegraph and telephone services when one considers that the total for the appropriation division this year is $10,639,000. The expenditure for 1966-67 was $9,489,617. The increase just for this one item is approximately 12% of the total increase for the division. I ask the Minister to say why this large amount has been appropriated for the current year.
– I want to take up the matter that Senator Bishop raised. The Weapons Research Establishment is of some importance to South Australia. I ask the Minister whether, in his reply to Senator Bishop, he could indicate the future of this establishment in our State. I wish to add to the questions that have been asked in relation to the acquisition of sites and buildings by the Department. While the amount involved is only $1,300 for this year, and there was no appropriation last year, perhaps the Minister could say what acquisition ii anticipated and the State in which it is anticipated. While there is to be a reduction in the provision for buildings and works and repairs and maintenance, according to the figures on employment contained in the Schedule of Salaries and Allowances there is to be some increase in personnel at the Weapons Research Establishment. For the first we see provision for three traffic officers and one transport officer. If operations at the Establishment are declining, is the Department commencing a new process? Why is it necessary at this stage to appoint such officers and what are their duties? Will they be employed at Penfield, Woomera or somewhere else? This year there is an increase of seventy in the number of assistants, machinists, typists and computers, which would suggest that in that branch at least there is some increase in activity. In regard to the technical and drafting officers, assistants and tradesmen there will be an increase of fifty-three. The position is confusing. Will the activities of the Establishment be reduced or, having regard to the increase in personnel, increased? If the Minister could assist on that matter it would be appreciated.
– Senator Drury raised the question of the postage and telephone increase of approximately $133,000. The increases attributable to provision for increased postal charges were estimated at $46,000 and the provision of services for the new Canberra offices and the extra charges arising from the operation of these services were estimated at $87,000. Senator McClelland asked whether Australia could compete with overseas countries in supplying ammunition to our armed forces. In areas where reasonable production runs can be obtained we can produce at comparable prices. In fact we have been able to sell in competition overseas where reasonably long production runs have been obtained. That is the reason why we sometimes try to obtain additional orders for this particular class of equipment, so that in the long run we can produce economically and in competition with overseas countries and also sell overseas.
-(Senator DrakeBrockman) - This morning, in the Committee, the Leader of the Opposition suggested that the debate on the estimates of each department be introduced in the Hansard report by incorporating the details set out in respect of each Division in the Second Schedule to the Bill and also the details set out in the Schedule of Salaries and Allowances. This would mean, in effect, the incorporation in Hansard in progressive stages of the complete Estimates, which now cover 300 pages as circulated as Schedules to the Appropriation Bill (No. 1).
As certain technical difficulties might be encountered in giving effect to the suggestion of the Leader of the Opposition I undertook to take up the matter with the
Hansard Department. The Principal Parliamentary Reporter has now advised me that, in the opinion of the Government Printer, the incorporation of the Estimates in Hansard, as suggested, would be technically impracticable particularly because of the problems it would present in making up the Hansard pages. In the view of the Printer these difficulties would delay very substantially the publication of Hansard and would add greatly to the cost of its production.
In the remarks which were addressed to the Chair this morning it was suggested that the Hansard record of the debate on the Estimates loses value for readers because they cannot ascertain to what item reference is being made. Further, the comment was made ‘that the incorporation of whatever information is needed to make Hansard a coherent document would be of advantage to the report of the Estimates debate. In this respect I should point out that at present Hansard in reporting the debate on the Estimates gives details in narrative form of each particular item to which an honourable senator refers.
– I should like to say that I am most grateful to you, Mr Chairman, for the statement that you have made. What you have said corresponds to a great degree with the belief that I had. Although I was anxious that the suggestion made by Senator Murphy should be accepted if it were at all practicable and economic I believe the suggestion would so expand Hansard and add to the technical difficulties of its timely production that the Senate ought to take time to consider the suggestion and perhaps refer it to one of our standing committees in order to serve the purpose of Senator Murphy’s suggestion, which is a laudable one. I believe that the Senate would be unwise to adopt the suggestion at this stage.
– I would like to thank you, Mr Chairman, for expeditiously investigating the matter. I concur in the suggestion made by Senator Wright. If there could be devised some abbreviated way of dealing with this matter, which might avoid the technical difficulties that have been adverted to, I believe that the record might be significantly improved.
– I take it that no-one wants to take any action at this particular time.
– The questions raised by Senator Bishop and Senator Cavanagh dealt with the future of the Weapons Research Establishment and Woomera. At this stage I can say that the work load probably will be a little heavier until 1970 or 1971. Whilst the Department is constantly seeking additional work and constantly looking at projects and endeavouring to interest other countries in projects, at this stage I cannot give any clear indication of what will happen beyond this date because the outcome of the talks on the joint project is not yet known. I understand the concern that South Australian senators have about this matter. Senator Laught pointed out a little while ago a fact of which I was not aware; namely, that the Woomera Rocket Range is one of the biggest employers of labour in South Australia. It would be impossible for anybody to say any more than I have said. Until we have completed an agreement on the new project we will not have a detailed analysis of the sections in respect of which the British Government is prepared to stay with us, the sections that Australia will have to finance and the funds that the Australian Government will be able to provide in order to keep those sections going. The position is completely in the clouds at the moment and will be so until we reach agreement with the British Government on the joint project. One or two other nations are interested in using our facilities. That may be a year or two ahead. Those plans are not concrete yet. Discussions are continuing on them. We are constantly on the alert. We are endeavouring to keep the range going at the maximum possible capacity. The work load will be heavier until 1970-71. The officers of the Department are very optimistic about the future.
– How does that explain the drop in the appropriation?
– I have not got down to the details.
– The Minister has replied to all of the points that I raised this morning; but I regret that although my questions were detailed I have not received detailed answers. I refer particularly to the Ikara missile. The Minister said that other countries are interested in it. Yet we have pruned the expenditure on our own production for the equipment of our own naval vessels by $20m. That is extremely confusing to me and to everybody outside the Parliament.
Another matter about which I was worried was the purchase of the site for the new Government Clothing Factory at Coburg. The Minister gave me details of the area of the site, but I am still not satisfied. The price of $334,800 seems an awful lot of money even if the area is 50 acres and the site is handy to a railway station. It is about the same amount as would be paid for an equivalent area for home building lots a similar distance from the centre of a metropolitan area. I respectfully ask the Minister whether the land was purchased by negotiation, by public tender or at auction. It must have been purchased by one of those methods. Who were the original owners of the land? Who was the middle man? Who was the agent who received the commission on the sale? This is a very large sum of money to pay for a piece of land in that area. I ask those questions with all due respect. I am not making any accusations at all.
– I would suggest that the honourable senator ask those questions when the estimates for the Department of the Interior are before the Committee. That Department did the negotiations and everything connected with this transaction.
– Does the Department of the Interior just purchase the land and then hand it over to die Department of Supply?
– The Department of the Interior does all of our purchasing for us. When we decide on an area that is to be purchased, the Department of the Interior handles the negotiations and arranges the whole matter.
– That makes the position even worse. It becomes a case of buck passing.
– I cannot allow Senator Keeffe to say that. I have been endeavouring to give the fullest possible information on every question that has been asked. I think honourable senators will agree with me when I say that. I am not prepared to allow Senator Keeffe to stand up and say that I am trying to pass the buck because I tell him the department from which he can obtain the information that he is seeking. If he is so ignorant as not to accept my advice, he can go ahead and do as he likes. I suggest to him that he ask his questions when the estimates of the department from which the information he is seeking can be obtained are before the Committee. I expect him to be intelligent enough to understand the advice that I am trying to give him. I am not prepared to allow him to say that I am passing the buck.
Senator WRIGHT (Tasmania) [2.50W rise, as I often do, to make a contribution towards subduing incipient flame. Senator Keeffe should know that the Department of the Interior operates as the property agent for all Commonwealth departments. 1 am sure that all that Senator Henty intended to convey was that information on the acquisition, such as the name of the vendor, the commission paid and the valuations, should be obtained during consideration of the estimates for the Department of the Interior. I suggest to Senator Keeffe that he make a request that the officers of that Department bring along their files on the valuations that have been made. I will join him in seeking information at the time when the matter can be probed properly. It is a fact that we will make the Estimates debate much more effective if we postpone the probing of this item until the estimates for the Department of the Interior are before us. That is all that I want to say on that matter.
I wish to add one comment to what I said about the suggestion that Senator Murphy made. I suggest for consideration that, if the old fashioned practice of a Minister introducing each section of the Estimates as it is called on by making a statement that would occupy about a page of Hansard and give the substantial details of that section of the Estimates were adopted, the Hansard report would be ever so much more readable and there would be a continuous intelligibility. That is the purpose of Senator Murphy’s suggestion. It may not be possible for Ministers to accommodate the performance of their duties with that suggestion now; but even if the suggestion were not implemented this year it could be considered in respect of next year.
I direct the attention of the Minister to page 241 of the Report of the AuditorGeneral. Dealing with such mundane matters as storage and transport services, the Auditor-General referred to arrangements for furniture removal for public servants. 1 am in difficulty in ascertaining the meaning that I should give to the last paragraph on that page. Before I read it I confess my difficulty. The report of the AuditorGeneral in couched in language that has the effect of denying to me a proper perception of the significance of many items. I have no doubt that that is not done purposely. It is difficult in the extreme to find the proper substantial criticisms to which items are open. The last paragraph on page 241 reads:
According to the records of the Department of Supply, the number of removals effected during 1966-67 was 20,084. In the same period, compensation claims by officers numbered 3,248 and $145,551 was paid to officers. Recoveries from contractors amounted to $78,821. These figures are not directly related due to carryover as between financial years.
I respectfully ask the Minister to tell me in simple and substantial terms what that means. In order to indicate my difficulty, I point out that the number of removals was 20,084. Over 3,000 officers claimed compensation. I should like to know the meaning of the expression ‘recoveries from contractors’ in this context. These figures should be related to something or to themselves. I am just mystified and I ask for enlightenment. At page 242 the AuditorGeneral states:
Costs of removals and storage of furniture and effects of officers of non-trading departments . . .
The previous figures do not refer to removals of the furniture and effects of officers of trading departments, but the AuditorGeneral goes on to refer here to nontrading departments:
This Division relates to the Central Transport and Storage Authority and the proposed appropriation this year is $3,722,000. I do not find anywhere in the next paragraph of the Auditor-General’s report a figure with which that can be correlated. The paragraph reads:
Such expenditure charged against this Division in 1966-67 amounted to $3,394,915 ($3,105,911 in 1965-66). According to the records of the Department of Supply, this included $300,600 administration costs, and $2,249,098 on account of the Service departments.
This is what I ask the officers particularly to note:
Additionally, substantial expenditure incurred on removals, (for example, disturbance allowance, cost of removals of motor vehicles, costs incurred overseas) is charged to the annual appropriations of the departments concerned, under Freight and cartage’ and ‘Incidental and other expenditure’.
I have in previous debates on the Estimates asked for an indication through the Minister of the cost to the Treasury of the removal of public servants in this way throughout the Commonwealth. The Auditor-General’s report does nothing to facilitate one’s understanding of that. I simply point to my difficulties and make a request to the Minister that he ask one of his officers to supply to us - not today, of course, as it would not be convenient, but in the next few days - with a full statement showing just what the cost is to the Treasury of removals of public servants. I myself have the feeling that as an item this is very extravagantly dealt with. I have a feeling that the system of administration in the Service requires an unnecessary increase of cost in this regard. I know that a Post Office official in Townsville must have an opportunity to appeal for appointment to a Post Office position in Hobart that will carry an extra $200 in salary, but there should be some rational approach to the matter so as not to make the cost to the Public Service of effectuating these transfers disproportionate to the advantage that a proper consideration of promotion of officers provides. So I point out my desire for a co-ordinated and full statement of the Treasury on the whole item, itemising these various matters to which the Auditor-General has referred with such incoherence.
I also ask the Minister to direct his attention to the top of page 243 of the AuditorGeneral’s report, which reads:
A special purpose unit has been established by the Branch to provide the particular transport needs for special occasions such as Royal Visits, visits of important personages, international conferences and special projects. Operational expenditure incurred by the unit during 1966-67 totalled $197,949. Departments and Authorities requesting the services reimburse the whole of the operational expenditure; $192,915 was recovered during the year.
The use of the expression ‘recovered’ is, I suggest with great respect to the AuditorGeneral, an unfortunate expression for the purpose of informing the Parliament. It is, in fact, just a book entry. The expenditure is incurred by the Department of Supply and paid by the Department of Immigration, the Department of Housing or some other department. What we as parliamentarians are concerned with is the net cost to the Treasury of this service, and interdepartmental set-offs are to be neglected in that respect. I suggest that the Auditor-General might tell us - if not this year then next year - the cost of this special unit and whether or not a separate appropriation for it in this way is economical, and might subject it to any criticism that he as an independent officer of the Parliament feels would be of interest to us as critics of uneconomical Treasury expenditure. In the little State whence I come the AuditorGeneral regards it as an essential part of his duty to point out not merely improper but also uneconomical expenditure. I wish to indicate that that is my conception of the Auditor-General’s duty here, and I would be most obliged if some comment could be made on that item by the Minister, but I have spoken in the hope that my viewpoint will be read by the Auditor-General’s Department.
– Earlier, unfortunately, out of deference to the Minister I sat down and forfeited my right to finish my contribution. I am sorry that I have touched the Minister on some soft spots. I have tried to co-operate with him. I get into an argument with some Minister or other every year during the Estimates debate. As Senator Wright said, it is our prerogative to be here to probe. If we think something is wrong we are entitled to ask for information. I am terribly sorry if I touched the Minister on soft spots, as a result of which he indulged in a personal attack.
– The honourable senator said that I was trying to pass the buck, which is nonsense.
– It was a perfectly legitimate question but I shall take the Minister’s advice and ask the appropriate department for information concerning this valuable piece of land, costing $334,800, for the Commonwealth Clothing Factory. The
Minister answered very clearly my question on the establishment in Townsville of an office of the Department of Supply. I appreciate this but I do not think that I am getting the information that I require. The Minister thinks he is giving me enough to shut me up but I cannot be shut up in relation to the Estimates, nor can anybody else who wants honestly to probe. I should like to refer to a couple of other points that I have raised on previous occasions. The Auditor-General, at page 235 of his report, states in relation to disposals:
The Board disposes of surplus Commonwealth property at public auctions, by public tender, quotation, or by other means approved by the Minister.
What is the meaning of that last phrase? What other means are taken to dispose of surplus or unserviceable materials coming under the control of the Department of Supply? As I have said before, many of these disposals auctions are a picnic ground for the big dealers. In some cases big dealers are racketeers. They buy a whole line of material at a bargain basement price, put it into their disposal stores and make 300% , 400% and sometimes more on selling the articles to the little working man who wants to pick up something cheaply. I have suggested before that some lots should be broken up or sold as single articles so that the small buyer will have an opportunity to buy surplus stock. I am critical because I think that on some occasions stock is sold before it becomes unserviceable and, on other occasions, that someone has overbought to the extent that stock becomes surplus.
My colleague Senator McClelland referred to the fire at the Weapons Research Establishment as mentioned on page 239 of the Auditor-General’s report.
– And I have not received an answer yet.
– I know that. I too am anxious to know what happened. I have marked my copy of the Auditor-General’s report with a query because this point aroused my interest. If a bonfire caused the destruction of a building valued at $158,500, why have there been no public statements about it? Has it been kept quiet for security reasons? It is also interesting to note that in this huge building there was only $12,500 worth of furniture and equipment.
Now I come to a couple of other matters which highlight the value of Senator Murphy’s suggestion relating to the incorporation in Hansard of the estimates for particular departments. I hope that the Government will accede to his request. In the document showing particulars of proposed expenditure for the service of the year ending on 30th June 1967 - I am sorry if I have become embarrassing by keeping last year’s document - page 119 shows proposed expenditure for the relevant Department under the heading Administrative Expenses and General Services’. On page 165 of the document covering service of the year ending on 30th June 1968 - the one now under discussion - the relevant heading in Division No. 763, subdivision 2, is ‘Administrative Expenses’ only, and the amount is somewhat less than last year’s. I know that the Minister gave some explanation this morning about new methods which have been adopted. Possibly there is some more detailed explanation that the Minister can give us.
I feel that the section dealing with transport could be enlarged upon. On page 57 of the supplementary report of the AuditorGeneral for the year ended 30th June 1966 we see under the heading ‘Operating Expenses’ - this relates to the Stores and Transport Branch of the Department of Supply - reference to the sum of $1,357,167 for the hire of transport. The appropriation for the previous year was some $300,000 less. I cannot find a similar reference in the Auditor-General’s report for this year but I do find in Division No. 776 of the current document particulars of proposed expenditure by the Central Transport Authority in respect of vehicles and equipment. Division No. 777 relates to the Central Transport and Storage Authority. The figure in Division No. 776 would appear to approximate a section of those amounts incorporated in the other report to which I have referred.
I do not want to be confusing about these things but I think that when these reports are compiled they should contain more detail. If I appear to be trying to probe too deeply, the Minister should not put on a ballet dance over it, because we only want information. There is no suggestion that we will tear him to political shreds over these things.
– I want to give the honourable senator the information but I want him to ask for it under the estimates of the correct department.
– That is much better. I appreciate that the Minister says he wants to give us information. If there is the merest suspicion that we will be prevented from probing the Estimates, that will react to his political disadvantage, not ours. I think we are entitled to ask for information. I appreciate the fatherly advice Senator Wright offered me after our little clash, but now that I have asked these questions I hope that I will get the answers and, in particular, the details I requested about the Ikara missile. The reply on that subject skirted round my question. It was a respectable answer but it did not go into the matter in depth.
I want to know about the mix-up in the transport section and the differences that can be seen in the two sections of the two reports. If the fire at Woomera was an act of God, or if a piece of one of the missiles fell into the building and caused the fire, tell us about it. The Auditor-General’s report says that inquiries by the Department are proceeding. We hear year after year that inquiries are proceeding. I remember that during the debate on the Estimates 2i years ago I sought information from another Minister in respect of another department. I am still waiting for it. I was fobbed off at the time but I have kept a record of my question and I will ask it again this year.
I am only doing the job of a member of the Opposition. We are here to see that the taxpayers’ money is spent correctly. We will not scream our heads off because of a legitimate increase in expenditure. That is part of everyday living under our system in 1967. We must make provision for increasing costs in various directions, but we cannot make provision if the Government is anxious to cover up things. I am sure that the advisers to the Minister and the servants of the departments are qualified people. I do not blame them, but I blame the Minister if he is not prepared to tell us all the facts on the matters on which we seek information. I would appreciate the points I have now raised being dealt with in more detail by the Minister.
Senator MCCLELLAND (New South
Division No. 771 - Weapons Research Establishment and to remind the Minister of the question I asked about the fire at Woomera on 10th April 1967. I think the Minister is indicating by some gesture that he has the answer. I would very much appreciate it.
The other matter I wish to raise relates to Division No. 765 - Government Factories - Maintenance of Production Capacity. I deal in particular with item 03 which relates to other expenditure. It is noted that last year there was an appropriation of $100,000 and expenditure of some $79,000. This year there is an appropriation of $173,000. This is, as I am sure the Minister will appreciate, quite a substantial jump in the estimation. The increase in anticipated expenditure on a cursory view of the figures, is quite substantial. Perhaps he can give me some information on that matter.
I hark back to Division No. 774, which refers to munitions factories, and to the question of the supply of ammunition for the Department of Air. Like Senator Keeffe, I raise this matter, not on a political basis, but in an endeavour to sort out the real situation. Frankly, on the figures supplied, I do not think the Department of Supply, in the event of an emergency, could supply the Royal Australian Air Force with proper ammunition bearing in mind that of the amount purchased last year by the Department of Air totalling $622,000, $519,000 worth came from France. The Minister in his reply referred to the purchase of 30 millimetre ammunition. He said, as I understood him, that the Department is interested in securing the licence from the French suppliers and that discussions are currently in progress about this matter. I will agree that the 30 millimetre ammunition appears to be the significant amount of ammunition involved in these purchases. But I also notice that the Department of Air purchased from the United Kingdom $86,500 worth of 30 millimetre cartridges. Why can we not obtain more of this ammunition from the United Kingdom than from France if we cannot get a licence in this country to produce this ammunition here?
Let me go through some of the details of other ammunition imported by the Department of Air. We find that 30 millimetre cartridges and pyro cartridges to a total value of $519,220 were imported from France. From the United Kingdom, as I have mentioned, 30 millimetre cartridges to a total value of $86,500 were imported. From Belgium we imported 9 millimetre cartridges to a total value of $13,300. From the United States of America we imported shotgun cartridges. These were purchased by the Department of Air from the United States. Why cannot these cartridges in particular be manufactured and supplied by the Department of Supply? Also from the United States we imported 7.62 millimetre cartridges and 40 millimetre cartridges to a total value of $2,240.
Surely these figures indicate that the Department is not geared to provide the Department of Air and the Royal Australian Air Force with the ammunition that they require. It is a hopeless sort of situation, if we are purchasing aircraft from France and then have to rely on overseas suppliers and on some licence arrangement for a continued supply of ammunition. If the licence to which the Minister referred and about which negotiations are going on for the Department to produce this ammunition in Australia is granted, I ask the Minister: Where will the ammunition in fact be produced? To put it another way: Where is provision made in these estimates for the Department of Supply to produce ammunition? In other words, if the licence sought is not allowed to be transferred to Australia, do we then have to continue to rely on France for the supply of this ammunition? If the licence is granted, will the Department of Supply manufacture this ammunition? If so, where is this provided for in the estimates? If the licence is not granted, is it intended that private suppliers will provide the ammunition? This is a matter of national importance. I hope that he will be prepared to provide a more detailed answer than the one that he has already supplied to me.
– Senator Cant referred to other expenditure in relation to government factories and the maintenance of production capacity. The proposed expenditure is $173,000. The provision under this item is to cover miscellaneous costs which are not chargeable directly to production. This includes the transfer of expenditure which was previously charged to reserve capacity maintenance. This amounts to $140,000. It includes also the cost of producing a film on production activities in government factories, management consultant services. These amounts are included under the heading ‘Other Expenditure’ as there is no other head under which they can be grouped.
Senator McClelland and Senator Keeffe referred to the fire at Woomera. This fire was started in an air conditioning duct. The committee set up to report on the fire has not been able to determine how the fire originated. Difficulty was experienced in getting enough water to fight the fire. All action capable of being taken to remedy any deficiency shown in the report has now been taken.
asked a question in relation to disposals and what was meant by other means approved by the Minister*. Usually items are disposed of by public tender or public auction. Sometimes they are sold to education authorities or boy scout groups. In this regard we receive requests from State governments. In such cases where the Minister believes that the Department should be able to help the authority concerned by making items available to such bodies that require them, this is done. The authority concerned gets in touch with my Department. Sometimes the items are disposed of at a price. In this way we help such organisations as self-help factories and that sort of thing. Not a very large amount is dealt with in that way. The boy scouts organisation and educational authorities seek some equipment from us when we are finished with it. Instead of disposing of it, we make it available. It cannot be made available without the approval of the Minister.
asked me some questions in relation to Divisions Nos 787, 789, 792 and 793. Each of these Divisions relates to property of the Department of Supply. In relation to the acquisition of sites and buildings, Senator Cant pointed out that the appropriation this year is $1,200 whereas the expenditure in 1966-67 was $335,460. This expenditure covered the provision for the clothing factory. The provision of $1,200 this year is for minor acquisitions. The expenditure of $335,460 in the last financial year was in respect of the clothing factory and the provision this year is for only minor acquisitions as there are no major acquisitions this year. Division No. 789 relates to rent. The rent increases arise from premiums sought and approved to lessors. The acquisition last year related to the site for the new clothing factory. Rent is for administration purposes. Division No. 792 deals with buildings, works, fittings and furniture. The appropriation to which the honourable senator referred covers furniture and fittings chiefly for the new Canberra offices. The expenditure is incurred on approved new tasks commenced in prior years and from the tasks to be undertaken in 1967-68. Division No. 793 is concerned with repairs and maintenance to Commonwealth property. A great deal of this property is of First World War vintage. Senator Cavanagh referred to Division No. 771 and asked a question about staff increases at the Weapons Research Establishment. The item in the estimates relates to approved positions. They will not necessarily be filled or provided for in the appropriation this year. Senator Keeffe asked a question about the stores and transport operations set out in Divisions Nos 776 and 777. It will take a little time to gather this information from other departments. I do not think that I will be able to supply an answer within the next day or two, but I assure him that he will receive a reply.
– It does not matter whether it is next week or the week after.
– That is all right.
– First I remind the Minister that I asked for some particulars concerning Division No. 77 1 - Weapons Research Establishment. He explained the general position in regard to the future of Woomera and the Weapons Research Establishment. I pointed out that the appropriation for these establishments had dropped considerably - by approx.mately §300,000. The Minister said that the picture is that until 1970 or 1971 these establishments will advance. But the fact is that the proposed appropriation for machinery and plant, which are capital items and which to my mind must provide the basis for further production and development, has dropped. I want the Minister to relate his previous statement about the future of the establishment to the fact that the proposed appropriation is smaller. I also referred to the four wings of the Weapons Research Establishment. They are the trials wing, the space physics wing, the engineering wing and the weapons research and development wing. Is the Minister able to say whether each of these wings is likely to expand its activities in the future and which, if any, are likely to have reduced activities. If he cannot supply that information to me today he may give it to me in writing.
I have two other questions to ask the Minister. I think that he should be able to answer one of them. I refer to Division No. 776 which deals with the Central Transport Authority. My question concerns the vehicles that are purchased by the Department of Supply. I understand that the number of Holden cars purchased by the Department is becoming smaller and that an increasing number of imported cars are being purchased. I have also noted that two makes of cars that are manufactured in South Australia - perhaps I had better not mention their names - are not being used by the Department of Supply, although they are being used by a number of State departments. They are very suitable for staff cars. They are manufactured by a very reputable organisation.
I want to know why the Department does not give a share of its orders to a certain South Australian enterprise which has made strides in recent years. The Department gives a share to another manufacturer in South Australia. As I have said, State departments have purchased many of the vehicles I have in mind. Does the Department of Supply use any method or formula in the selection of cars? As the Minister knows, the Department purchased two or three makes of imported cars which were not satisfactory. I cannot understand why the Department does not purchase cars that are manufactured in South Australia. I would like the Minister to tell me why this is so. I would like the Minister to be specific on the last question that I raised; he might like to give it further consideration. I refer again to the rocket which misfired and to the Minister’s reply to me yesterday which is reported on page 929 of Hansard. I would be satisfied if the Minister could give me a reply to this question at a later date. I refer to the safety system in the rocket which misfired. The Minister will remember that rocket sections measuring 7 feet by 6 feet were found and that they were reported to be too heavy to shift. I want to know why this happened when two statements from the Department seemed to indicate that the rocket should have completely shattered. The following report appeared in the Adelaide ‘Advertiser’ of 20th September after these heavy sections had been found:
A Department of Supply brochure on the flight safety system says that explosive charges in the rocket are also set to detonate automatically as each stage enters the earth’s atmosphere thus ensuring the vehicle’s disintegration and reduction of each stage to small pieces of inert debris.
The Minister, when he replied to me yesterday, suggested that the safety self destruction system applied only to the full potential or capacity. The answer to this question probably will entail a detailed explanation. In view of the time available for discussing the Estimates, I would be quite satisfied if the Minister considered the matter and gave me a reply in the Senate or in writing.
– Senator Bishop asked a question about the Department’s policy in purchasing cars. Cars are bought as a result of public tender. In fact, the Department is purchasing a greater number - not a lesser number - of the particular make of car which he mentioned. I think that the result of the latest public tenders shows that more South Australian products are being purchased now than previously. Senator Bishop did not mention the makes of the cars and I do not want to mention them either at this stage.
– A few more could be purchased.
– I do not think that the honourable senator will be dissatisfied. The cars are purchased by public tender. If I interpret correctly the other point that Senator Bishop raised, he was worried about whether the shelters we provide would give adequate safety against-
– Why did the Department say that the whole rocket system should shatter and yet large sections of it were found?
– I shall have to get the technical answer to that question. Senator McClelland referred to 30 mm ammunition. Thirty millimetre ammunition from the United Kingdom is used for the Aden gun on the Sabre aircraft. Thirty millimetre ammunition from France is used for the DEFA gun on the Mirage aircraft. They are totally different types of ammunition although they are of the same gauge. If we received a licence from France the Department of Air would pay for the ammunition, which we would manufacture at the ammunition factory at Footscray.
– Senator Cavanagh asked for particulars concerning the appropriation of $1,300 for the acquisition of sites and buildings under Division No. 771. Has the Minister a reply to that question?
– The item refers to the minor acquisition of land in the Woomera area. Senator Cavanagh also raised the point that although the appropriation for machinery and plant, buildings, works, fittings and furniture and repairs and maintenance has decreased, there has been an increase in the appropriation for employment. The proposed appropriation for salaries in 1967-68 provides for a nil increase in personnel. Although the schedule of salaries and allowances shows an increase in numbers, these positions are not necessarily filled. Although capital expenditure might be reduced, operations certainly are expected to increase at a high rate through to 1970-71.
– 1 refer again to Division No. 763. I am interested to know why there has been an increase in the provision for postage, telegrams and telephone services from $314,000 last year to $446,000 this year.
– I have answered this.
– How does the Department know what the telephone bill is going to be? Is the increase due to the increased postal charges?
– I have already answered this, but I will give it to you again.
– I take it that this Department is concerned with the establishment of munitions factories and other factories connected with the supply of equipment and materials. I ask whether the Government keeps in mind the value of decentralisation when considering the establishment of new factories or research organisations.
– As to postage, telegrams and telephone services, the increase of $132,000 is attributable to the provision of $46,000 for increased postal charges, and the provision of services in the new Canberra offices and the extra charges deriving from the operation of those services, which are estimated to amount to $87,000.
The honourable senator referred to decentralisation. Ours is one of the most decentralised series of factories in Australia. We have factories in Bendigo, Ballarat and a number of other country areas.
– All in the south of Australia. None in the north?
– We have very good contractors in the north from Toowoomba to as far north as Cairns. I like the way in which Queenslanders are taking an increasing interest in submitting tenders for contracts. I encourage this because the more contractors we have interested the more competition we have, and this is all to the good from a business point of view. We always have in mind the virtues of decentralisation.
Proposed expenditure noted.
Department of Customs and Excise
Proposed expenditure, $19,787,000. Proposed provision, $85,000.
– Division No. 155, sub-division 2, item 06 relates to payment to the PostmasterGeneral’s Department for collection of duty on goods imported through the parcels post. I ask the Leader of the Government, as representing at the moment the Minister for Customs and Excise (Senator Anderson) why it is that in the year just passed the amount expended was $254,300 and it is expected that the payments for the coming year will also be $254,300, while under the provision for postage, telegrams and telephone services the amount sought for the current year is $441,200 as against an expenditure of $358,644 last year. What arrangement is made between the Postmaster-General’s Department and the Department of Customs and Excise for the evaluation of the service provided? Over the past few weeks or so the whole functions of the Postmaster-General’s Department have been exposed to scrutiny and made the subject of debate. The PostmasterGeneral’s Department has discovered that, because of losses in some of its services, it has become necessary to increase postal charges.
For the benefit of the Minister for Customs and Excise (Senator Anderson) who has just arrived, I point out that the provision for payment to the Postmaster-General for collection of duty on goods imported through the parcels post for this financial year is the same as that made for last year. I ask whether consideration has been given to making some alteration in the system of payment because charges for postage, telegrams and telephone services are expected to increase considerably from $358,644 to $441,200. I suppose that that increase can be justified in the light of the expected increase in postal charges.
In these cases where the staff of one department, such as the Post Office, is engaged for a considerable amount of its time in carrying out the duties of officers of other departments, such as those of a customs officer, a charge should be made, but in this instance the Department of Customs and Excise does not expect to have to pay any greater sum this year than it did last year for the collection of duty on goods imported through the parcels post. How is the accounting done? Why is it that there is not likely to be any alteration in expenditure on this particular item? Has there been any consultation through the Treasury between the Department of Customs and Excise and the Postmaster-General’s Department with a view to assisting the Department of Customs and Excise at the expense of other users of the facilities provided by the Post Office?
I come now to sub-division 3, which relates to other services. I refer in particular to item 01 which relates to the remission of duty under special circumstances. The appropriation for this item last year was $232,800 while the amount expended was $222,035. For some reason or other, this item is expected to cost only $40,000 this year. Could the Minister supply me with details of the special circumstances which warranted remissions of duty amounting to $222,035 last year? What altered circumstances result in only $40,000 being appropriated for this financial year?
There is one other matter about which I would like some information from the
Minister. It is dealt with in the same subdivision and relates to the provision of financial assistance for the sale of petroleum products in the Northern Territory. The appropriation this year is $900,000. I surmise that this money is for the bounty or equalisation payment to stabilise petrol prices. Does this increased appropriation represent an increase in the amount of the bounty or does it relate to an increase in the amount of petroleum products being sold in the Northern Territory? I would like to know also whether the Department of Customs and Excise is involved in the sale of petroleum or whether this only relates to an adjustment in excise or other charges on petroleum.
P.47] - Regarding the payments by the PostmasterGeneral’s Department, this concerns a contract negotiated from time to time by my Department. The contract is presently under review. Negotiations take place between representatives of the Treasury, the Postmaster-General’s Department and my Department. This is a contractual arrangement and the matter is reflected in the figures. As to Division No. 155, subdivision 3, ‘Other Services’, the appropriation will cover the remission of duty on goods imported by charitable and religious organisations. The duty on cigarettes and tobacco for ex-servicemen in repatriation hospitals, and other concessions approved by the Minister, is also covered under this item. The reduction in the requirement for 1967-68 results from the issue of by-laws. In other words, this is to be done under by-law rather than by special remission. The by-law relates to a prescribed item and it is dealt with in a different way to the normal remission technique. The reduction for this financial year results from the issue of by-laws to allow the entry into Australia, duty free, of parcels sent to Australia by Service personnel overseas or brought with them on return to Australia. It will also cover non-collection of duty and sales tax on non-commercial parcels totalling $1 and the non-issue of postal notes for additional duty amounting to $2 or less.
The other matter referred to was petroleum products. Financial assistance for the sale of petroleum products in the Northern Territory is estimated this year to cost $900,000. The appropriation for 1966-67 was $762,000 and expenditure was $749,874. This appropriation will provide funds for the subsidy scheme to enable a reduction in costs in the more remote areas. Prior to the commencement of the petroleum products subsidy scheme the Government was aware that there would be a switch from non-eligible products to eligible products in some instances. The extent of this changeover was impossible to estimate. The view was taken, however, that this substitution was within the purpose of the scheme as the use of a subsidised fuel in industry would foster centres away from the capital cities and so help decentralisation. This substitution has been particularly evident in the Northern Territory and a switch to subsidised products, mainly automotive diesel oil, is expected to continue as well as there being substantially increased usage. I think that is the substance of the explanation that Senator O’Byrne seeks on this item.
– I have been searching for information about control of the drug traffic. I have been looking at Division No. 155. Could I refer to it under that heading?
– I think the honourable senator, with the concurrence of the Chairman, could refer to it under this Division.
– I would like the Minister to inform me whether he or the Government has any association with any type of Interpol organisation engaged in the control of the drug traffic. I am sure the Minister has taken a great interest in this problem. The city of Sydney has gained notoriety in the drug trade; its reputation is probably second to none in the world. I was reminded that only recently police officers from the United States of America came to Australia to pick up four very important members of an alleged drug ring and take them back to that country. I got the impression that these officers were here as intruders. In my study of this problem I have not become aware of the existence of any international organisation to control this trade. There is an international traffic in drugs but we in Australia have an internal problem.
I would also be interested to learn whether shipping companies have any responsibility in relation to the carriage on their vessels of illicit drugs. Are shipping companies prosecuted or disciplined in any way if drugs are found on their ships? For instance, a particular ship sailing between Australia and the East might have a bad record. There was one vessel which was raided almost every time it came to Sydney.
The third matter I want to mention is one about which I have spoken to the Minister before. On the Sydney waterfront particularly there is a serious shortage of customs officers. They have a big job to do. I do not know how many miles of waterfront there are in Sydney that the officers have to look after. They have to deal with very clever people. Union members used to tell me that they could not possibly do the job with the staff they had. I also know that the Minister attempted to recruit and train additional staff. I would like to know whether additional staff has been obtained and whether results are better than they were in the past. The Minister was quoted in the Press recently as saying that he had the drug traffic under control. I think the Minister, in doing so, might have been carried away with some of the successes that his Department has had. The drug traffic is a world wide problem. Probably it has been receiving more attention in Australia than it should because there is a bigger addiction in Australia than in any other country, according to the newspapers.
– I would like to point out to the Committee that my Department has always had a very close association with its counterparts in other parts of the world. I want to be a little circumspect in what I say in relation to its activities. You will appreciate, Mr Chairman, that there has to be some restraint in that regard. The head of our prevention and detection staff in Sydney was sent overseas recently to improve his knowledge and to meet his counterparts in other parts of the world, with particular emphasis on the Far East, and to have conferences with people and organisations. It is true to say, without going into detail, that a very real chain of communication exists between certain high officials of the Department and similar officers in Europe, North America and the Far East. Senator Ormonde made reference to certain persons in Australia who were involved in an alleged drug ring and by direction of the court taken tack to the United States of America. I might add that I received a letter, addressed to me personally as the Minister, from the United States organisation expressing its thanks to a particular officer of the Department who had played quite a considerable role in the whole exercise. The Department and the officer concerned treasure that letter very highly because it is an appreciation of the type of work that is being done in the context to which the honourable senator referred.
– Could the Minister inform the Senate of the co-operation the Department receives from the Commonwealth or State police?
– I will make reference to that later. Firstly, I will answer the queries raised by Senator Ormonde. Senator Ormonde asked about the responsibility in relation to shipping companies. There is provision in the Customs Act for action to be taken against shipping companies and indeed against the master of the ship where there is prima facie evidence of some physical act which would suggest that a constructional alteration had been made to the ship for the purpose of concealment, which might reasonably have been expected to be within the knowledge of the master. That is the provision contained in section 228 of the Act. Indeed if it is a small ship the Customs Act gives power to confiscate and sieze the ship. For a ship of over 250 tons, the penalty is S 10,000. The Senate recently dealt with an increase in the penalties. Honourable senators can see that quite definite consideration is given to this particular aspect.
– That would be in a case where the master approved of the concealment, participated in it or had knowledge of it.
– The wording is not as precise as that. Senator Wright would appreciate, perhaps more than most of us, that in many ways the wording of the section is very difficult to understand. There are precedents for this action. Generally, there has been a tremendous build-up of personnel since I was appointed Minister; in fact one of my early comments in this House was that we had received approval from the Commonwealth Public Service Board for a tremendous increase in our preventive staff. One cannot press a button and get an increase of staff; the staff has to be recruited. Having recruited officers, they all go to a special school for training. Quite recently, as has been publicised, the Department has appointed some females to the staff because it believes that they have a role to perform in this field. They went to the school to receive special training so that they could do the necessary work in the prevention and detection of breaches of this particular aspect of the Customs act. The Department has enlarged its staff, across the State borders of Australia, to some 500 personnel in this particular field.
asked a question in relation to co-operation between the Commonwealth and the States; that is between the State police, the Commonwealth police, the Commonwealth Department of Health, the State Department of Health and the Commonwealth Department of Customs and Excise. I am happy to say that there is a high degree of co-operation. In certain circumstances when raids have had to be made there has been complete co-operation of the State police; otherwise the raids would not have been effective. This co-operation is improving and extending all the time. As honourable senators know, the situation now is that the States are amending their legislation in relation to narcotics to bring it into line with the Commonwealth legislation and to have a more or less uniform pattern in relation to penalties. This is in accordance with the international convention to which the Commonwealth and States have become parties. I would say that there has been good co-operation between the Commonwealth and the States. Because of the increasing awareness of the seriousness of the problem and the difficulties of the Commonwealth and the States in carrying out their functions, we are drawing even closer together in handling the mutual problems that we face.
I tried to answer by way of generality, but I come back to where I started when answering Senator Ormonde’s questions. Yes, it is true that Australia has special relations with other countries of the world and that recently the head of the Department in this field was sent overseas to liaise with overseas organisations. As the annual report shows, Australia has made a real onslaught on this particularly wicked, evil and illicit drug traffic.
– I direct my attention to the administrative section of the estimates of the Department of Customs and Excise. My first comment is that the Department is a very vital one to the Commonwealth. I have had some experience of the Department through being a member of one of the Committees of this Parliament which investigated the workings of the Department. I express my congratulations to the Minister on the class of officer in charge of the various sections of the Department, particularly those who head branches of the Department in the various States. Generally the view of honourable senators on both sides of the chamber is that the Department has earned congratulations for arranging its affairs in an organised way.
I do not wish to direct my attention to all the items under this proposed expenditure, but I would like to refer to the proliferation of staff in which we, as the Government, must certainly have some hand. I note that the number of positions has increased from 3,677 last year to 3,991 this year. I realise that as the community grows it is usually necessary for departments to employ extra staff. I direct the attention of the Minister to one or two points in relation to staff numbers and salaries. Last year there were four assistant comptrollers-general and the appropriation for their salaries was $39,840. This year there is the same number of positions but the proposed expenditure is $57,942. There may be some reason for that increase. I note that only in Tasmania and the Northern Territory is the number of employees being reduced. The Minister may be able to indicate whether there are special circumstances in those two areas.
I ask the Minister to explain some of the figures that appear on page 199. Firstly I refer to a variety of figures which appear after the heading ‘Northern Territory’ but which obviously have nothing to do with the Northern Territory. They probably relate to unclassified positions. The appropriations for last year and this year seem to be completely inconsistent. I will mention one or two and hope that the Minister will take the matter further. Last year the appropriation for district allowances was $27,820. This year it is $26,520. There has been a reduction in respect of that item. For the item ‘Other allowances’, the appropriation last year was $8,528; this year it is $135,616. For the item ‘Permanent officers occupying temporary positions’, the appropriation last year was $759,348; this year it is $93,038. For the item ‘Officers on unattached list’, the appropriation last year was $2,000; this year it is $82,033. I ask the Minister for an explanation of the drastic variations between the appropriations for last year and this year.
Still referring to the staff of the Department of Customs and Excise, I say that the Department is to be congratulated on the action that it has taken to extend the system of commodity control. The position in this Department is similar to that in others. For instance, in the PostmasterGeneral’s Department the installation of technical equipment and subscriber trunk dialling should result in a saving staff. We will be disappointed if departments do not exercise control so that within a few years we will see a saving in staff. I realise that in respect of many of the modern devices that are being introduced, such as automatic data processing equipment, the general view is that the number of staff will not change very greatly; that the generation of business that will occur in the future will be coped with adequately by the existing staff; and that that is where the saving will be. That might be the position in relation to staff for the commodity control system. I hope that in the field of excise control over petrol, beer and spirits a saving in staff will occur fairly shortly.
In discussions with officers of the Department of Customs and Excise during the last year I have not been convinced that the way they have handled my queries in relation to the applicability of import duty to certain items has been satisfactory. In the view of both private industry and the Department, there occurs something of which many people in the community complain; namely, a great loss of time because of what is called red tape. The Minister will be familiar with several matters that I have raised with him. I have in mind at the moment a large public company in Victoria which was endeavouring to import material that was not available in Australia. The Department was seeking to protect an Australian manufacturer who said that he was able to do a certain job. I realise the difficulties involved, but a period of 12 or 18 months has elapsed since the proposition was first made. The Australian manufacturer had certain things put to him, perhaps in honesty or perhaps in an endeavour to protect a certain industry. But the fact is that this application for prohibited imports to be allowed into the country has not been dealt with adequately and concisely by officers of the Department.
Currently I am discussing a problem with the Department. It relates to the importation of an overseas machine. The gentleman in question, after making a review of the Australian position, was satisfied that no machine along the lines of this particularly scientific machine was made here in Australia. He proceeded to Germany, purchased the machine, brought it here and paid $22,000 import duty on it. That was quite correct. The machine is very valuable. He was endeavouring to establish that no such machine was available on the Australian market and that Australians did not have the knowledge to produce such a machine. Perhaps he should not have been charged the rate of duty that he was charged. He received letters from the Department of Customs and Excise telling him to do certain things in relation to a series of manufacturers in order to establish the true position. He did those things. He wrote back to the Department giving it certain information. The Department replied to the effect that further things would have to be done. I realise that the Department must protect Australian industries. But cannot we find some method by which we can achieve some efficiency in these matters instead of what has happened in this case? The first inquiry was made last December and, although it was believed that the statements that were made at that time would finally be proved, the Department is still saying: ‘We cannot do anything unless you can give us some more information’. I do not believe that such a situation is good for industry. I do not accept that it is good for our control of a department.
– Is this a matter of bylaw waiver?
– Yes. A large public company in Melbourne wanted to import a certain item of timber, which was processed in Canada, I think, for pattern making, which is a fairly specialised operation.
The process, which is available overseas, but
Hot in Australia, is a type of finger jointing which involves taking small wastages of offcuts and glueing them together in one way or another to make a panel of a width that no tree available in Queensland or any other State would provide. We do not have the raw material here. The Department in its wisdom said to the importer: You cannot import that because we believe that it is available in Australia’.
– We do not say that it cannot be imported.
– No. The Department says that it cannot be imported at a certain rate of duty. This is an item which can be made cheaply overseas because of this particular process. One manufacturer, who happened to be an importer in the same line, incidentally - that was the main reason - said that he could produce this item. For some 12 months the matter was held up until finally the Department had a letter from the person who objected saying that in truth he could never have produced it. Here was a wastage of time. I think that a method could be found to get over this difficulty by means of statutory declarations. I have had before me a number of propositions in which wastage of efficiency was suffered by manufacturers and a great amount of time was lost by individuals who were endeavouring to achieve efficiency by bringing a particular product into this country. I ask the Department whether there is not some way, perhaps by a review of methods, in which this by-law control can be improved.
– Order! The honourable senator’s time has expired.
As far as practicable I shall deal with these matters in the sequence in which they come. Senator Webster alludes to the administration of by-law entry control. We deal with about 50,000 by-law applications in a year. He suggests that we should be able to evolve a system which relies on statutory declarations. Heaven help us if we got to that stage. It would lead to a result quickly enough but an approach on that basis would be an over-simplification. The onus is on the applicant to prove that suitable equipment is not reasonably available in
Australia. The position is quite clearly defined. If somebody chooses to go overseas, to Germany or somewhere else, and commit himself financially to the importation of a certain machine or piece of equipment, before first satisfying himself that a suitable equivalent is not available here, he will have to pay duty in accordance with the tariff. If he fails to satisfy himself beforehand, inevitably he runs into difficulties. In fact this does happen. One must remember that the question of definition is a very difficult one. What one person sees beauty in, another person does not.
– It is in the eye of the beholder.
– Yes. I and my Department have dealt with colossal numbers of these cases. My door is open to anyone who wants to put a case. People who are engrossed in a particular machine or piece of machinery will never concede that there can be an Australian machine or piece of equipment that can do the same job.
– But that is not the criterion.
– No. The criterion is whether there is a suitable equivalent of Australian - or in some cases British - manufacture reasonably available.
– I do not think that those are the relevant words.
– Before I sit down I shall obtain from one of my officers the exact text of the conditions. Throughout Australia my officers have to get information and make decisions. In relation to the United Kingdom and Australian trade agreement we have to go to the British Board of Trade to get a waiver. It may well be that we take 6, 8 or 10 months, or even a year in certain instances, to get decisions in relation to these matters. A person comes along and says - in good faith; do not misunderstand me - ‘This harvester or cropper of mine will do certain things that no other one will do.’ One can always get variations. For example, to over-simplify the position, a person may say: ‘One cannot get a pen of this type - a bone-handled pen - in Australia. Therefore I should get a by-law waiver. This pen has some peculiarity. It suits my fingers because it has a bone handle.’ However, the item is still a pen.
This is an exaggeration but it is an example of the sort of situation that arises. In relation to by-law entry there is a query as to whether a suitable Australian - or in certain cases United Kingdom - equivalent is available. We try to assist the Australian importer. We say that on the face of it certain firms in Australia can produce, or say that they can produce, the particular item. The onus is on the importer to establish that this is not so. When the importer establishes that this is not so and comes back to us with evidence, this becomes a very real factor in a consideration of the matter.
The by-law provisions are tremendously complex. I do not think that the honourable senator should make a judgment on their application to individual cases. As we all appreciate, one can get into what might be called a grey area, where officers have to make judgments and recommendations to the Minister. This is not something on which one can make decisions with complete and absolute precision. There is a marginal area in which the question of whether or not there is an equivalent item reasonably available becomes a matter of judgment. I have been handed by my advisers a piece of paper which deals with the conditions that apply to these matters. Perhaps it would be better if I handed it to Senator Wright instead of reading from it.
asked some questions about administration, staff increases and the like. Reference was made to commodity control. I appreciate the point that in the ultimate there must necessarily be less administrative function and more efficiency. It must be remembered, however, that commodity control in this Department has not yet been introduced completely. The Committee may recall that the Public Accounts Committee suggested that we should increase as far as practicable the tempo of introduction. That is what we are doing, but our budgetary figures do not show the picture fully. They will not do so until we have commodity control in a wider field of operation. No doubt next year’s Budget will show a more complete picture. The honourable senator referred to Tasmania. I understand that already commodity control in Tasmania has had some impact on the amounts he mentioned.
One of the odd things about Darwin, to which reference has been made, is that we are getting less work at Darwin as a point of entry, particularly by air, because of the rearrangement of international flights. Therefore there has been a reduction in staff requirement at that location for this particular duty, but there has been a great buildup of staff in other parts of the Territory. New ports are being opened which require the establishment of sub.collectorates, the appointment of additional staff and so on. However, although there has been a lessening of certain of our activities at Darwin there has been an increase in administrative costs because of salary increases.
We are dealing now with that part of Division No. 155 - Administrative - which relates to salaries and payments in the nature of salary. I have some general information which perhaps should be put on the record. Estimated expenditure under this item for 1967-68 provides for the payment of salaries and allowances to permanent officers. Estimated increased expenditure over actual expenditure in 1966-67 will also provide for (a) the additional 201 positions created during 1966-67, reclassifications and annual increments to officers. I point out that the additional positions were needed to cope with the organisation changes involved in the implementation of commodity control, the introduction of the Inland Services Branch and further recruitment in the prevention and detection sections; (b) the impact of Determination 35 of 1967, which related to a 2i% increase in margins, for a full year; (c) the permanent appointment of former temporary staff under amended appointment provisions; (d) the basic wage increase of $1 a week as from 6th July 1967; (e) Determination 117 which related to increases for minors operative from 8th June 1967, the provision in this case including arrears, and (f) the increases approved for clerical assistants.
I turn now to item 02 which relates to temporary and casual employees. Expenditure on salaries and payments in the nature of salary for temporary and casual employees amounted to $777,842 last year. This year estimated expenditure is $716,000, a slight reduction. The variation is due to (a) a reduction in numbers of temporary positions as a review of organisation structure by Public Service inspectors in all States proceeds and permanent positions are created in lieu; (b) a reduction in temporary employees as amended conditions for permanent appointment take effect; (c) a reduced provision for the payment of employees pending permanent appointment; (d) an increased provision because of the basic wage increase of $1 a week as from 6th July; (e) the effect of Determination 1 17 providing increases for minors as from 8th June 1967, the provision in this case including arrears, and (f) increases approved for clerical assistants. I have now covered the items relating to permanent and temporary staff.
Item 03 relates to extra duty pay. I think this is germane to the story. Expenditure in this direction was $1,241,095 in 1966-67 and the estimate for this year is $1,190,000, a slight reduction. The variation is due to (a) the effects of Determination 260 of 1966 and Determination 35 of 1967 for a full year in all States, these determinations providing increases for temporary clerks and an increase in the basic wage respectively; (b) increased aircraft schedules in Queensland and Western Australia; (c) an increase in Victoria due to the move to the new Customs House which, incidentally, will be opened by the Prime Minister (Mr Harold Holt) on Friday week; (d) a considerable saving in New South Wales resulting from a new procedure in the invoice room, and (e) increased overtime rates as a result of the basic wage increase of $1 a week as from 6th July 1967, Determination 117 which provided increases for minors operative from 8th June 1967 and increased salary rates approved for clerical assistants. If I have missed any point we can pick it up the next time round.
– There is probably a very quick answer to the problem I have in mind and I would be very grateful to have it. I do not see any provision in the Estimates for depreciation. This is probably because I may be looking under the wrong heading. The lack of such provision may be due to the fact that the Department of Customs and Excise is not classed as a business undertaking, but it seems to me that the Department controls buildings and equipment and there should be provision for depreciation just as there was, for example, provision of $69m for depreciation in the Postmaster-General’s Department last year.
The Department’s annual report carries a photograph of a gas chromatograph in the laboratory in Melbourne. There must be a lot of other similar equipment. There is also a photograph of the new Customs House at Melbourne. That building- would be worth some millions of dollars, but I can see no provision for depreciation. I think a department of the size of this Department should make some provision for depreciation of its assets. I cannot even find any reference to assets held by the Department of Customs and Excise. This is probably due to my inexperience and my inability to go through all the documents in a satisfactory way. I would be very happy to have a reply to this question.
– I have a very simple question which possibly was answered partially in the few minutes I was out of the chamber when the Minister was replying to the first query. My question relates to financial assistance in the sale of petroleum products in the Northern Territory. I have been particularly interested in the submission and implementation of the proposal for an equalisation of the cost of fuel in inland areas. It has been a wonderful boon to the people who previously had’ to pay a great deal more for their fuel than did people in the capital cities. In the broad, they now pay 4c a gollon more than the capital city prices.
I repeat this point. This is a wonderful scheme for country people generally and particularly for very isolated country people. As far as I understand it, the scheme has been administered by the Department of Customs and Excise. The heading which I read from the Estimates leads me to believe that this is the avenue from which these rebates are provided because the item to which I refer relates to the ‘Sale of petroleum products (Northern Territory) - Financial assistance’. My questions are: Is the amount shown opposite that item the total that is being subscribed by the Commonwealth Government to this equalisation? If it is, why are the words ‘Northern Territory’ included? If it is not, where does the total figure appear?
– I am obtaining the answer regarding the matter of depreciation raised by Senator Wilkinson and I will be able to pass that information on to him shortly. The answer to the question asked by Senator Morris concerning the petroleum products subsidy scheme in the generality can be found in the estimates of the Treasury. I have already given to the Committee a reply to this question and 1 do not think it is necessary to repeat it.
– If the Minister has made his answer, I will read it in Hansard.
– Very well. The Customs House is in the domain of the Department of Works. Regarding the matter of depreciation, I point out that the accounting by Commonwealth departments for Treasury estimates is simply on a receipts and expenditure basis. Public utilities such as the Post Office keep their own internal accounts or double entry accounts and bring in depreciation. So depreciation, as the honourable senator very properly pointed out, cannot be found in our accounts.
Senator WRIGHT (Tasmania [4.37]- I notice that the Auditor-General, in dealing with the Department of Customs and Excise, commences his treatment of the subject in his report for the year ended 30th June 1967 at paragraph 45, which appears on page 49, and travels to paragraph 57 on page 54 before he concludes. He begins his consideration by referring to Revenue’ and then goes on to deal with Excise Revenue Commodity Control’. The point I wish to make is that from paragraph 48 to paragraph 57 inclusive the Auditor-General deals with various bounties. As I read the estimates of the Department no details of these bounties are given. It is completely unhelpful to me that the AuditorGeneral should include under the heading of the Department of Customs and excise subjects that are irrelevant to the estimates of that Department. It would be a great help to the Parliament if the AuditorGeneral, in compiling his report, would follow the same order as the Estimates.
– It would be. There is no doubt about that.
– Yes. The second thing that I wish to say relates to the speech by Senator Webster regarding the by-law administration. I can understand that this is a complex and most vexatious matter in view of the fact that the Department has to deal with some 50,000 applications a year.
– It is over 50,000.
– Yes. Some of the applications would involve large amounts while some would involve small amounts. The point is that we should not let the administration of customs revenue defeat the real purpose. Senator Webster said that administration must not frustrate business and trade. I wish to refer to this matter just to make the point clear, because if it were clear I would have expected a different’ reaction from the Minister. 1 do not know the man to whom Senator Webster referred, but I take it that the man bought from Germany a special machine costing $22,000.
– That was the duty.
– Very well. That man ought to be told his financial position within 2 months at most, even if it involved a reference to the Board of Trade. With the communications that are available to purposeful officers of the Department today, information relating to a machine of that sort could be found in Germany, the United Kingdom and Australia within that time. 1 just wish to add my advocacy to the idea that the purpose of the customer or the entrepreneur ought to be borne in mind so that he may begin to use the machine and know his financial position before the end of the year. The matter should not be unnecessarily delayed.
I am grateful to the Minister who has passed to me the terms in which the by-law provisions are stated. I sought these provisions because it is implicit in the Minister’s approach that beauty is in the eye of the beholder. That is a lovely idea. But it is that very human failing which makes it imperative that we keep steadfastly in mind and have our minds focused upon the true legal criteria. Otherwise, one could ask fifty officers whether a machine is entitled to duty free entry and receive fifty different views according to the shade of red they like. The thing to do is to look at the terms and ask: Are the goods that are imported a suitable equivalent of goods produced in Australia that are reasonably available?
– May I say: Ah, that is the rub?
– These are the two things upon which the mind of every officer should be focused. On those things only should the mind of every officer be focused. Are the goods a suitable equivalent and are they reasonably available. ‘Reasonably available’ connotes not merely cost, but time, distance and transport. What is decided in relation to Brisbane may not necessarily be the same answer as would be given as at Alice Springs. The point is whether Australian goods are a suitable equivalent.
In this regard I have in mind a most enterprising firm of chicken producers. This firm has grown through its own small efforts into quite a substantial business. It is concerned with poultry crates. The steel manufacturers of Australia are still producing heavy steel wire crates. Not only are these crates heavy and difficult to manage, but also the poultry is bruised and knocked about when carried in them. After making inquiries in other countries this firm of chicken producers found that Israel was the only country in which plastic crates were made. Yet try as we will, we cannot get those plastic crates from Israel into this country. Nobody can suggest any other country in which plastic chicken crates are produced, lt is said that the old iron and steel crates are a suitable equivalent. I have entered into the discussion in deference to what Senator Webster has said, because I think it is important that the Parliament should let the administration know the impact that neglect of these accurate features by the Administration can have on the commerce of the country. This item about which I speak on behalf of the electorate of Tasmania is frustrating in the spirit. In the aggregate these items are of importance to the whole economy of the country.
I ask the Minister to be good enough to comment upon the decision that was made, I think during this year, to exempt under by-law duty on DC9 aircraft imported by Trans-Australia Airlines and Ansett-ANA. I am very interested to ascertain the amount of duty that was involved in those importations. Here again the Parliament is concerned with a vital principle. Taxation is imposed only by the Parliament. Income tax is waived only after submitting a claim for concession to an inde pendent board. The Commissioner of Taxation is given the right to remit income tax only in the case of a definite independent exemption which can be produced at any time that it is brought into question. That applies no matter what the remission is. It could be a remssion of $10 or $200. I have forgotten whether there is a minimal exclusion. But in the Customs field I have an idea that a duty of, say, $500,000 could be imposed if it were not exempted under bylaw. This is a tremendous jurisdiction and authority to give to any department or Minister. Naturally the Parliament is very anxious to know the considerations that govern a particular decision in major matters such as the exemption of duty on aircraft.
I ask the Minister to bear with me while I discuss two particular items in the estimates for the Department of Customs and Excise. In the schedule of salaries and allowances for 1966-67 an appropriation of $39,840 was made for four Assistant ComptrollersGeneral. In 1967-68 the proposed appropriation for the same four officers is $57,942, which is an increase of approximately $18,000, or 50% more than the previous year’s appropriation.
– That is a typographical error. It should show that there are six officers. I am sorry that I omitted to mention that fact when replying to a previous speaker.
– Thank you. The only other item I refer to is the one dealing with permanent officers occupying temporary positions. Last year the appropriation was $759,348; this year it is to be $93,038. That is not a normal variation. I would be obliged if the Minister could comment on it.
– If there are to be six Assistant Comptrollers-General this year, it follows that the total of officers listed in the schedule will not be 444.
– I have only been told about that typographical error.
– It follows that the total must be different.
– I am not able to answer Senator Webster’s question immediately. I hope to bc able to supply an answer shortly. Senator Wright made a point concerning the AuditorGeneral. The Auditor-General chooses to make his presentation in the way he wishes. That is his domain. But if the honourable senator turns to the document entitled Estimates of Receipts and Summary of Estimated Expenditure’, he will find that table No. 5 on page 23 deals with all the expenditures on the various bounties. The total amount payable by the Department of Customs and Excise on account of bounties is $49,899,000. The various bounties are spelt out in this particular document.
– If we wish to criticise them, the point is that we want to bring them up when we are discussing the appropriate item.
– I appreciate the honourable senator’s point. I do not mind if he raises the matter when we are discussing the estimates for the Department of Customs and Excise. But he is raising the point without having the actual figures in the estimates for the Department of Customs and Excise upon which to base his argument. He has to turn to the document entitled ‘Estimates of Receipts and Summary of Estimated Expenditure’ to get the figures.
General references have been made to by-law administration. Far be it for me to suggest that we are doing a job that is 100% perfect. I do not suggest that for a moment. Some of Senator Wright’s general statements might well be true. We, like everybody else, are conscious of the problem. As I said earlier in reply to Senator Webster, if an individual importer intends to import a commodity which attracts a duty of $22,000, I would have thought that the proper thing for him to do would be to ascertain the position before he imported it.
– It only means that you incur the delay before the importation instead of after.
– We are now getting more into generalities which are outside my own Department, but we live in a country which has a protective tariff and he would be an extraordinary person who would buy goods which are going to attract a duty of something like $22,000 who would not have said, before he went to Germany to buy the goods: ‘Before I start buying anything over there I want to know what it ls going to cost me landed in Aus tralia’. That, to me, seems to be elementary. If the normal duty is under a classification the person concerned would very probably say: ‘It is possible that I will get by-law entry for this and get it in duty free, or at 7i% under the United Kingdom-Australia Trade Agreement’, ls not the proper thing to do to go to the Department and try to clear the decks with relation to these matters before buying? I would have thought that would be the prudent thing for a person to do. But, in the event, people do not do these things and my Department is conscious of this. When people do not make inquiries beforehand, the problem becomes even more intense and more difficult to solve.
We are very conscious of our problems with relation to the by-laws and very conscious of the need to get quick decisions with relation to them. But it is not easy, and when it comes to world trade it takes longer. Australia is a vast place. Senator Wright has suggested that what might be a suitable equivalent might differ from one State to the other. The tariff applies equally over the whole of Australia. We therefore have to look at these by-laws from the point of view of the whole of the Commonwealth, just as we do the tariffs. I agree that what was a suitable equivalent in Tasmania might not be a suitable equivalent in New South Wales or in the Northern Territory, but we cannot isolate these things to suit the various States. If the honourable senator thinks about it, I think he will agree that it would not be possible to do this, because the tariff itself is in fact a duty on a national basis.
I want to make the point that at the present time discussions are going on in the Department in an effort to speed up our functioning with relation to by-laws. Our methods are constantly under review. Honourable senators might be interested to know that our head by-laws officer is at present in the United Kingdom looking into this matter. We are constantly looking at the problem and the points that are raised in debate.
Senator Wright spoke about waiving duty on the importation of aircraft. The first point I want to make is that this question of a 71% preference was discussed between the United Kingdom and Australia. The decision in the relevant case was made by the Government, not by the Department or me.
– What was the question decided?
– That they would enter duty free.
– But on what criteria?
– On the by-law criteria that the honourable senator has in his hand. This matter did not relate to Australian protection, it related to the United Kingdom preference, and it was considered that the United Kingdom did not have a suitable equivalent reasonably available. Therefore, the aircraft were admitted duty free.
As I have already indicated to the honourable senator, the question of the arrangement of the Estimates is the prerogative of the Treasurer. Senator Webster referred to what appeared to be an astronomical increase in the appropriation for salaries although the number of officers remained the same. That was an error. The figure 4’ should have been ‘6’.
The other point Senator Wright raised related to permanent officers occupying temporary positions. He pointed out that our appropriation for last year was much greater than is sought this year, in that last year we appropriated 8759,348 as against $93,038 for this year. The reason for that variation is that the present policy of the Public Service Board is not to have temporary positions. I think we all concur in that policy. There has been a quite distinct and dramatic move in these particular Figures.
– I refer to Division No. 155 - Administrative. I should like to draw the Minister’s attention to the fact that last yeal I referred :o complaints that were being made by passengers arriving at busy airports about the service that was available to them. They said that the method of passing through the customs was not on a level with that which they had experienced in other airports on their way to Australia. I understand there has been considerable improvement in the general attitude towards processing of passengers. One interesting development has been in the method by which people make their declarations. In order to speed up the passage of people through customs I understand that the written declaration !s to be done away with and that in future people will just be asked questions and make an oral declaration. But I note that there is no provision for any great saving in the administrative staff.
I hasten here to point out that I commend the Department upon its economy. 1 think that, of all the departments that are under consideration in this Bill, the Department of Customs and Excise has the smallest proportionate increase in staff. But ons would think that in these days of electronic data processing of returns and so on and the streamlining of the technique of passing passengers through customs, great savings would be effected as compared wilh the olden days when we did not have these modern methods of distinguishing the odd person who was smuggling or bringing in contraband goods from the passenger who was just going about his ordinary business. I would like the Minister lo tell me whether the new technique of merely asking questions of passengers has been introduced. If so, how successful is this system and is it expected that the new method will result in savings to the Department?
The other matter I wanted to refer to also concerns administration. It came to my mind when I was reading the annual report for 1966-67 of the Department of Customs and Excise. The report states (hat during the financial year there were 78 prosecutions for illicit distillation activities and the possession of illicit spirit and unlicensed stills. The report states:
The majority of these were brought under the Distillation Act 1901-1966 and related to the possession of illicit spirit and unlicensed stills.
The report mentions the prosecution of a liqueur manufacturer who was delected operating an unlicensed still with a capacity of 30 gallons. He was fined $650 and his manufacturer’s licence was cancelled. I think that penalty is to be expected in regard to anyone who illegally manufactures liqueurs. The report stated:’
The series of raids conducted in the Mumimbidgee Irrigation area in June, 1966 resulted in IS successful prosecutions with fines totalling $3,825. The offences involved 8 stills and a large quantity of raw alcohol. la April this year, another series of raids was conducted in the Queanbeyan-ACT area. Subsequently, 9 stills and approximately 30 gallons of illicit spirit were seized.
The finesimposed for the offences in the Murrumbidgee Irrigation Area and the QueanbeyanAustralian Capital Territory area averaged $250. The report continued:
There were 48 inquiries under Part XIII of the Excise Act 1901-1966 relating to’home brew’ beer. Fines imposed totalled $1,406.
Those 48 inquiries resulted in people being fined, on an average, $30 each. I ask the Minister how his Department differentiates between offenders in the Murrumbidgee Irrigation Area and those in other areas? An offender in the Murrumbidgee Irrigation Area may have spent years in Italy where he brewed his own vino. He would probably prefer his home brew to some of the more expensive and over-priced Australian commercial brew.
– Especially if the home brew is not soured by excise.
– That is right. The commercial brew is soured by the charges imposed. I believe there are excessive mark-ups on Australian wine. I recall the words of Omar Khayyam:
I often wonder what the Vintners buy One half so precious as theGoods they sell’.
– That is why the vintner marks up the price.
– I do not think the vintner marks up the price; that is done by other people who do not have the art of producing the wine but make money by charging a high price for it. My point is that at the moment the President of Italy is in Australia. The Italian Government concluded a new agreement with the Australian Government for Italian migrants to settle here. Italian migrants in Australia have been praised for their industry and their ability to assimilate into our communities. But I think the matter of making their own wines is important for them. They should be able to carry on a custom which is traditional in their own country. They made their own beverage in their homeland and many of them drink it as we drink tea. There is tannin in tea and I suppose that could be dangerous if it were taken in quantity. I think we in Australia have an attitude towards alcoholic beverages which stems from a long way in the past, from Puritan times. Our attitude is gradually becoming softer and the penalty for taking alcohol is not so severe. Drinking is now more accep table socially. It may be that the Department of Customs and Excise is more interested in the revenue that can be raised by way of excise or fines than it is in the rights of people who have traditionally made their own wine. Perhaps these people could be given a licence to make their own wine. We should not impose on them too great a price if they wish to brew their own vino. It is an important matter for them.
I would like the Minister to tell me how his Department differentiates between a person in the Murrumbidgee Irrigation Area who operates a still for which offence the average fine is $255 and a person who makes home brewed beer in the QueanbeyanAustralian Capital Territory area, for which the average fine is $30. One could almost say that it would be an Aussie who was making the home brewed beer because beer is our national drink, if there is one. Australians drink the lot, but perhaps they drink more beer than anything else. To an Italian migrant or a migrant from one of the other southern European countries, wine is the native drink, yet the fines on people who make vino average $255. How does the Department differentiate between the offence of brewing vino in the Murrumbidgee Irrigation Area and that of brewing beer, in the Queanbeyan Australian Capital Territory area?
– Senator O’Byrne spoke about the new customs clearance procedure for passengers arriving by air in Australia. A new system has been in operation for only 2 months, so its effect has not been reflected in the estimates. It is a system of oral declaration. It was introduced not for the purpose of raising revenue or easing strains on the administration but to facilitate entry of passengers and their clearance through customs. It was designed to make customs clearance more convenient for the public.
Under this system each passenger is given a note to read before arrival in his country. When he reaches the customs shed or office he is asked whether he has read the document and whether he has anything to declare. I might mention that quarantine items are of particular interest to my Department because of the health responsibilities involved. Under this system the onus rests upon the passenger to say whether he has any prescribed items or anything else to declare. At that stage the normal procedures are applied. There has been no reduction in the number of staff involved in this type of work. This system was introduced so that there would be no inconvenience for people entering Australia. Firstly, they are given a piece of paper on which there is certain information which they must understand. Secondly, they have to provide answers to customs officers
In respect of a person who having made an oral declaration and then having his baggage checked, is found to be in possession of an article which should have been declared, a different set of procedures apply. A 100% check is then made. If the circumstances are only minor, the traveller would be charged with an offence under the Act and maybe dealt with under Part XV. It is within the power of the Collector for the State concerned, as my delegate, to take all the evidence and then make a recommendation to me, as the Minister, or to the ComptrollerGeneral, as to what the penalty should be. The Department is following a world pattern of quicker processing of passengers through customs.
The Department is movingto the next stage, which is far more difficult to administer, of oral declarations from people coming into the country by ship. Everyone concedes that this is a far more complex and far more difficult operation. The Department is introducing it ona trial basis in Melbourne and Fremantle. Difficulties will emerge. When a person enters Australia by ship he does not necessarily have all his luggage in one place; he could have some cabin baggage and some baggage in the hold of the ship. It is a complex operation. Nevertheless, the Department is following the world wide trend. It is trying to facilitate the passage through customs of people entering Australia.
The second question that Senator O’Byrne raised was in relation to wrongdoers, illicit stills and the making of vino. The important thing to remember is that where the brew is for home consumption, if there are no special circumstances the tendency is to deal with that matter under what is known as Part 13, which is the excise equivalent of Part 15 of the customs section. In other words the officers of the Department can seize the home brew and the collector for the area can investigate the matter and recommend a penalty to the Minister or his delegate. Therefore, generally speaking persons making illicit liquor for their own use are not in the same category as persons who may have an illicit still for the purpose of making spirit and selling it commercially. Under the provisions of the Excise Act such persons can be brought before a court. The court, within the framework of the Act, determines the penalty.
– Did I understand the Minister to say that it is for him or the ComptrollerGeneral to determine the penalty for non-disclosure on entry?
– Part 15 of the Customs Act and Part 13 of the Excise Act provide means for dealing with minor offences. Rather than put the person through all the inconvenience of going to court the collector in each State can set up a tribunal maybe that word is too harsh at which the person concerned can go along and give evidence. There is a transcript of what is said. The collector has regard to the evidence given by the officers of the Department and the person concerned and gives a recommendation to the Minister. The Minister delegates the powers to his ComptrollerGeneral and a decision is made as to the penalty. That procedure happens only with very minor offences. The Department has experience of people doing things unwisely. Somebody who is very oldmay, without thinking, fail to declare something. When asked about it, he still may not face up to it. He may say that he does not have anything in his pockets or his bags. He is then in contravention of the law. A decision has to be made as to whether the offence is a minor one or one that has to go before a court. Procedure under Parts 13 and 15 is very worth while because it allows the deck to be cleared of some of these minor offences. If honourable senators saw the procedure in operation as I do they would agree that it works well.
As to the offences referred to under the heading ‘Illicit Activities’ in the annual report, the situation is that while it may be a minor offence for a person to brew in his own interests it is a different story if he is brewing for the purpose of selling spirits to a group of people.
– I must refer the Minister back to the point which Senator Wright and I raised regarding by-law entry of goods. I believe that the Minister’s comments on this matter were not quite fair. No two people in this House are more anxious to protect Australian industries than Senator Wright and I. I know that even those countries that profess to be our greatest friends in actual fact can deal very harshly with us by dumping their unwanted goods on our market. In the near future Australia will have to oppose this very strongly in relation to some of our largest industries. The Department must be on its toes in this matter.
I raised two instances which I believe would give the lie to the point that the Minister made when he said that it was very unwise for an individual to set out to purchase something overseas unless he first established that he would be able to take advantage of the by-law. This is a reasonable comment. I mentioned the instance of a $22,000 duty on a machine. A person who is prepared to pay duty of that amount on a machine whose capital cost attracts as much duty as that would look at the proposition before he went overseas. I would credit him with that much intelligence. I know of a.n individual who acquired a machine which has never existed or never been made in Australia. There is only one patent in the world, and that is in Germany. This individual knows every such machine that is produced in Australia. His property originated Australian manufacture in this line, but no Australian company knows how to make the machine that can be produced only in Germany.
– Does the honourable senator mean that the Australian companies do not know how to manufacture it or that they are not permitted to manufacture it because of the patent?
– Because of the patent rights they are not permitted to make it, and they do not know how to produce the end product. The machine to which I refer is a hop drying machine. I do know that to preserve the quality of hops from the green state to the final state is a very delicate matter. The position was that the grower needed this machine and imported it and paid duty on it, thinking that the duty would be refunded. He made application to the Department for a refund. The Department’s view was that four companies could produce the machine. He wrote to the four companies. From three of them he received the reply that they were not interested. The fourth company said that it could make a blowup because it had made drying machinery before.
– Did that company say that it could reasonably make the machine available?
– The company could not make the machine available and could not quote a price which would indicate whether it would be reasonably available because the company did not know what to manufacture. The Department’s attitude is that it is no use arguing because the local manufacturer could produce the machine. Unfortunately the Department, after 9 months of correspondence, must come to the point where it says: ‘Yes, we have reviewed the situation and we will refund the duty on the machine because no manufacturer in Australia can make it.’ I only wish that an Australian manufacturer could make it.
The other instance that I mentioned was in relation to a machine for pattern making in timber. The company concerned did exactly as the Minister said, lt applied to the Department to have this material allowed in. After 2 years of unsuccessful endeavours to have it admitted the company came to me. One individual may know that Australia doss not have pattern making material. Another individual may not know that and may ask a company: ‘Can you joint some boards together to make a 24- inch or 36-inch width?’ The company may reply: ‘Yes, we can’, and without knowing the details supply from Canada chip 6 inches long, being jointed together in length and in width by a process that makes the product available in Australia at a very cheap price - one at which we in Australia would not have a chance of producing that product.
The company to which 1 have referred thought it had an opportunity to import this item. The fact in that instance was that the company that prohibited the importation of this item was an importer itself. Its natural reaction was to say: ‘We can provide this item within Australia’. That ended the matter. There were letters to and from this very important and honoured importer. But it could not get any sense from the Department. After two years of negotiations and no end of time wasted on a file that I was shown, the company finally got the Department to agree. Either the Department had that view and stuck to it because it knew it was right, or it found out after two years of wasted time that it had another view on the matter. The Minister said that people should have enough sense to look forward. I put it to him that in the two instances that I have mentioned the people concerned did look forward. Yet an individual who knows the trade in Australia and can establish whether this machine should be imported is still unable to prove to the Department that he should have the right to import it under the by-law system.
– I wish to make only a couple of comments. The first is that I deprecate the practice of dealing with individual oases in the Estimates debate because I cannot reply to the remarks that are made. There is a sacred law that each by-law consideration is a matter between the individual concerned and the Department. The second is that, if it took 2 years to get a decision which was the right decision, that was not wasted time, and the Department instead of being criticised should be congratulated because it was sufficiently open minded to investigate the facts and to make its decision.
I go back to what 1 said at the beginning. First of all, a prudent person who may have to pay duty will find out what duty he will have to pay. That is inescapable. I do not think we can dig out an odd instance and build a case around it. Certainly I cannot discuss a particular case with an honourable senator in this chamber. I have seen Senator Webster in my office in relation to a particular case. My door is not closed yet. I suggest that he should not come into this chamber and use one case as a vehicle for attacking the by-law system while my door is still open to him. I do not want to say any more. Senator Webster can still come to my office and we can still talk about individual cases. He will be given the same courtesy as he has been given in the past. My Department and I will still try to do the proper thing, consistent with my obligation and that of my Department in relation to customs duty and by-law entry.
– The Minister’s last few words are very welcome and comforting. I appreciate them immensely. I do not want to press the matter, except to remind honourable senators that we have been advised not to enter into second reading speeches in the Estimates debate and that leads us to refer to individual instances. Individual instances are are the best illustrations of the administration of the general principles of the law. Therefore it is not entirely valid to say that we should not raise individual instances in the Estimates debate.
– Not while they are still current.
– I hope I will be permitted to develop my theme. The whole point of the Estimates debate is to bring to the minds of the Minister and his Department the viewpoint of the Parliament if the Parliament represents the country. Although the practice has been acquiesced in for 20 years or even 50 years, it may be appropriate to reconsider it in 1967.
Having said that, I ask two specific questions. Firstly, when finally there is a difference of opinion on whether there is an Australian product that is a reasonably suitable equivalent to an import and reasonably available, is the final decision entrusted to the Minister and is his opinion expressed in the law the final opinion, or is it possible for the importer to obtain an adjudication on the matter by taking an objection and getting a court decision that there is or is not an Australian product suitably equivalent and reasonably available? Secondly, is there any limit on the amount of duty that can be foregone in the case of the importation of goods of which there is not an Australian product suitably equivalent and reasonably available? For instance, the Minister’s authority may cease at a duty of $5,000, $50,000 or $500,000. He may be required to report specifically to the Parliament when his decision involves the waiver of a large amount of duty. These are the safeguards in which I am interested in a system of democracy subject to law. I would be pleased to receive answers to those two questions.
– I may wish to elaborate later, but the short answer to the honourable senator’s first question is that it is for the Minister to make a by-law decision; but if he requires further evidence he may refer the matter to the Tariff Board which can then make a complete investigation, take evidence on oath, call people before it and make a recommendation to him. Naturally, the Board would require the Department, which referred the matter to it, to supply all the information that it had, but the Board would not necessarily be limited to that information.
In reply to the honourable senator’s other question, I say that I do not know of any limitation on the Minister. Obviously, if the waiver involved an astronomical amount of duty, if. the Minister had any sense at all he would take the matter to the Executive. That would be wise administration. If the amount of duty that was to be waived was huge, no doubt he would want to be fortified by the fact that the other members of the Government or the Cabinet knew what he was doing. But in truth there is no limitation on the decision that the Minister may make.
Proposed expenditure and proposed provision noted.
Department of Housing
Proposed expenditure, $4,510,000. Proposed provision, 545,500,000.
– I want to raise a few questions in relation to housing. The main purpose is to try to enlist the support of the Minister in achieving some clarification of these estimates and an understanding of what they are all about. I refer first to Division No. 917, which is dealt with in Appropriation Bill (No. 2). Last year an appropriation of $250,000 was made in respect of an advance to the Housing Loans Insurance Corporation under the Housing Loans Insurance Act. I take it that that was for the purpose of establishing the Corporation. As no appropriation is proposed for this year, I gather that the Corporation, having been established by a grant made by the Parliament, will now be self-supporting. This raises the question of whether we are now viewing the activities of the Corporation and whether it comes under the Minister’s portfolio.
I turn now to Division No. 260. Subdivision 1 relates to salaries and allowances in accordance with the schedule, temporary and casual employees, and extra duty pay. The total appropriation proposed under these headings is reduced by an amount to be received from the War Service Homes Insurance Trust Account and amounts to be received from purchasers and borrowers of war service homes in respect of technical and legal services. I should like some clarification of the payment to be made from the War Service Homes Insurance Trust Account. I take it that the amounts to be received from purchasers and borrowers relate to technical and legal services that have been granted. Subdivision 2 of Division No. 260 also refers to an amount to be received from the same trust account and amounts to be received from purchasers and borrowers, by which the proposed vote is reduced.
We get into difficulty when we come to consider what the Department is achieving and what its future is to be. These estimates appear to make no provision for the appropriation of funds for homes savings grants, which I take to be an important function of the Department of Housing. We have to look somewhere else for information about the Department’s achievements. Turning to the schedule of salaries and allowances in relation to the Department we find that provision is made for the salary of the Director of War Service Homes. How much are the activities of the War Service Homes Division interwoven with those of the Department of Housing? It is difficult to understand why the two organisations are not amalgamated. The schedule indicates that there is to be a reduction of 19 in the number of architects, draftsmen and other technical officers employed by the Department. Does this indicate a slackening of activities? On the other hand, there is to be an increase of 46 in the number of accountants, conveyancers, advisers, investigation officers, research officers and clerks, and an increase of 27 in the number of clerical assistants, typists and machinists. Is the work of architects, draftsmen and other technical officers to be curtailed while the work of the employees in the other categories increases? I could understand that, it would be necessary to increase the number of architects, draftsmen and other technical Department were expanding, for the purpose of assisting in th’e preparation of plans and for supervision and inspection. Perhaps the Minister will throw some light on this reduction.
The proposed appropriation for the Department this year is $4,510,000. One would like to see what the Department was achieving. We find that much more expenditure is associated with this Department than is shown in the Estimates. The AuditorGeneral’s report points out at page 93 that payments are made from the National Welfare Fund to the Department of Housing. In 1965-66 there was a special appropriation from the National Welfare Fund of $13,559,154. In 1966-67 the special appropriation amounted to $12,027,017. This indicates that payments made in 1966-67 for the purpose of homes savings grants were not as great in the previous year. The annual appropriations that were made under Act No. 45 of 1966 and Act No. 25 of 1967 amounted to $4,304,065 in 1966-67, which was in excess of the amount provided in the previous year. The annual appropriations under Act No. 46 of 1966 and Act No. 26 of 1967 for capital works and services amounted to $59,350,000 in 1966-67. The total of the expenditure under all of these appropriations was $75,681,082. In addition to this expenditure, an amount of $139,097 in respect of rent was charged to Division No. 315 which is under the control of the Department of the Interior. Amounts of $41,714 in respect of furniture and fittings, $3,344 in respect of repairs and maintenance, and $3,151 in respect of buildings and works, were charged to Divisions Nos 610, 615 and 967 respectively, which are under the control of the Department of Works.
Sitting suspended from 5.45 to 8 p.m. (General business taking precedence of government business) -
Motion (by Senator Henty) proposed:
That Government business now take precedence of general business.
– Mr President, as the Senate knows, the Opposition regards very jealously the arrangement for general business to take precedence of
Government business on Thursday evenings and would not lightly agree to a motion such as has been proposed on this occasion. But’ we do agree, and I feel that some explanation ought to be given so that those who read the record in future will know the reasons why we have done so. It was intended, by an arrangement made in the Senate last night, that notice of motion No. 7 standing in my name a motion for an order for the tabling of certain accounts and papers relating to VIP aircraft be dealt with in general business tonight. Since that arrangement was made we have learnt that the Prime Minister (Mr Harold Holt) intends to make a statement in the House of Representatives about VIP aircraft; that it will also be made in the Senate next week; and that a general debate on it will ensue. The subject matter of the notice of motion standing in my name, which would have been proposed by me tonight, will be dealt with by the Senate during that debate. In those circumstances it means that the right to take general business tonight has been foregone, in effect, for the general convenience of the Senate and to meet the changed situation. Therefore we of the Opposition agree to the motion proposed by the Minister for Supply (Senator Henty).
Senator WRIGHT (Tasmania) [8.31- Mr President, I wonder if I might be permitted to make a comment.I feel that Thursday nights are properly utilised for the discussion of non-government business. I hope that this will develop and that all the business of a non-government nature will not stem from the Opposition alone. I appreciate the circumstances mentioned by the Leader of the Opposition (Senator Murphy) about the motion standing in his name. I expected that it would be moved tonight. From my point of view, Mr President, I think that debates on Thursday nights should be of a purposeful character. I believe that the listing of the items on the notice paper is so contrived as to make the situation somewhat disappointing.
Last Thursday night we discussed a matter which involved fundamental constitutional principles: The proper relationship between this Parliament and the arbitral system; a fundamental . question that involved the action of a parliament in relation to a decision of a court. I put myself on record, in those few brief terms, as regretting that we cannot get such an understanding in the chamber and subdue purely partisan political purposes so as to debate the principle I have mentioned. This objective can be achieved only by continuous debate. I am sorry to have been so long in stating my viewpoint, Mr President. I do so for a purpose.
– in reply - 1 would like to add a few words to what was said by the Leader of the Opposition (Senator Murphy). The position of the Opposition has been preserved in order to enable us to continue with Government business tonight, and resume consideration of the Estimates. I think that the Estimates debate enables the Senate to perform one of its most important functions. I have been through the mill myself today and I do not think anybody would deny that the Senate gives very close attention to the Estimates. To continue with the consideration of the Estimates tonight will in no way prejudice the position of general business. The Leader of the Opposition has described the situation and 1 agree with him.
Question resolved in the affirmative.
Consideration resumed (vide page 1042).
Department of Housing
Proposed expenditure $4,510,000. Proposed provision $45,500,000.
, - Just before the suspension of the sitting I commenced dealing with the estimates for the Department of Housing. I was trying to explore what activities the Department covered and was examining some of the details of the cost of operating this Department. I was assessing the cost of the activities of the Department in order to find out what we are paying for the services provided. As I stated, one ot. the questions I want answered is whether this Department controls the Housing Loans Insurance Corporation. I want to know whether we will be in order in discussing the Corporation in this debate. 1 also want to know how much this Department has to do with the War Service Homes Division. Honourable senators can see from the Esti mates that this Department pays the salary of the Director of War Service Homes. The Department is to pay to the War Services Homes Division about $10,000 for the Director’s salary, but it receives from the War Service Homes Division, in two payments, some $100,000. I want to know how far we can engage in a discussion ot war service homes or the activities of this Department in that regard.
I want to come to the vital question of what it is costing the Government to administer this Department and what it achieves. Referring to the homes savings grant I find the work of the Department is set out in very brief form at the commencement of the Department’s annual report. I see that last year the Department paid out by way of loans a total of $11,987,572 to 27,768 applicants. The average loan was $432. I respectfully submit that we cannot find in the Estimates the true expenditure of this Department because so much of it is dealt with in other Departments. If we accept the report of the Auditor-General we can see what happened for the years 1965-66 and 1966-67. In 1965-66 the total value of grants amounted to $13,559,152 and the administrative expenses of this Department cost the Government $3,910,285, plus $70m for capital works and services as approved by the Appropriation Bill for 1965-66. For 1966-67 1 find that the number of applicants availing themselves of this wonderful scheme that the Government instituted must have dropped because the appropriation has fallen from Si 3m to $12,027,017. But the cost of administration has risen to $4,340,063, while capital works and services were $59,350,000.
Therefore to distribute $11,987,572 among the 27,768 applicants whose grants were approved during the year, with an average grant of $432, is costing $67m. Benefits are paid to 27,768 applicants. The total housing construction rate in Australia is approximately 90.000 houses and some 36,000 to 40,000 fiats a year. The scheme is making a very poor impact upon housing construction. The report discloses that only approximately half the loans granted were for the purpose of new houses. Therefore the figure drops to about 13,000 applicants. The cost of the scheme to the Commonwealth is exorbitant. Other than the figures that I have mentioned there are some figures relating to the Department of the Interior and the Department of Works. This amounts to a very costly scheme of housing benefits. It is all very well to say that the number of young people-
-(Senator DrakeBrockman) - Order! The honourable senator’s time has expired.
– I rise to give the honourable senator the opportunity to continue his remarks.
– I appreciate Senator Wright’s courtesy in giving me the opportunity to continue my remarks. I would have welcomed the intervention of the Minister. I am in the dark and 1 am seeking clarification of some points. If they could be clarified as we went along it might give me the opportunity to correct any mistakes that I have made in my calculations. With the greatest respect to Senator Wright, and in full appreciation of what he has done, I shall conclude at this stage.
[8.15] - Senator Cavanagh asked whether the War Service Homes Division was part of the Department of Housing. This of course is so. As the Director is a statutory authority, it is necessary to show his position separately. The honourable senator also raised the question of payment to purchasers and borrowers of amounts received from the War Service Homes Division in respect of technical, legal and insurance recoveries. The position is that the Commonwealth meets the cost of administering the war service homes scheme except the cost of providing technical services in the preparation of plans, and so on. the cost of legal services in respect of conveyancing matters and the cost of administering the insurance scheme. The cost of these services is recovered from the applicants by means of fees, and these have been deducted from the total administrative expenses of the Department. The honourable senator also mentioned the reduced number of architects in connection with war service homes. As all honourable senators know, the number of applicants for war service homes has lessened considerably. Now there is no waiting list, which is excellent. With fewer applicants fewer architects are required.
The honourable senator also asked where details of expenditure from the National Welfare Fund were to be found. I will give the honourable senator the information that he has requested. In the document Estimate of Receipts and Summary of Estimated Expenditure’, it will be seen that under the National Welfare Fund, homes savings grants have been estimated at $13.2m. Under the Commonwealth and State Housing Agreement the contribution to rental losses is estimated at $45,000. The estimate of $ 13.2m for 1967-68 has been made having regard to the current intake rate of applications, plus an allowance to cover the estimated population increase, and an increase in the number of applicants who will become eligible for grants as a result of the amendments made to the Homes Savings Grant Act in May 1967. Following these matters relating to the National Welfare Fund, the 1945 Commonwealth and State Housing Agreement makes provision for the Commonwealth to share with a State a cash loss that may be incurred in any financial year in the administration of rental housing projects erected by that State under the 1945 agreement. The Commonwealth’s contribution is 60% of the loss incurred, subject to the State meeting its obligations under the agreement, including the charging of economic rentals. Rental rebates granted according to a formula laid down in the agreement are allowed as part of the loss. The provision made for 1967-68 relates to a payment to be made to the State of Queensland for operations during 1965-66.
Knowing Senator Cavanagh’s interest in home savings grants, which he has shown on many occasions, I believe he would be interested to know the latest figures which are available. The statistics to last Friday are as follows: The number of grants paid since the inception of the scheme is 89,999; the amount paid since the inception of the scheme is $39,960,651; and the average grant is $444. I think these are excellent figures. They show the value of this very important and very useful scheme.
Senator Cavanagh also asked about the advance to the Housing Loans Insurance Corporation. The expenditure in 1966-67 was $250,000; this year no appropriation is to be made. Under Section 31 (1.) of the Housing Loans Insurance Act an advance of $200,000 was appropriated in 1964-65 to finance the establishment of the Housing Loans Insurance Corporation. Pursuant to Section 3 1 (4.) of the Act, which permits the Treasurer to make additional repayable advances, a further advance of $250,000 was authorised under the Appropriation Act (No. 2) 1966-67 to maintain the Corporation in a sound financial position during the early stages of its development. It is expected that further supplementary advances will not be sought. I do not think I have left any query unanswered. If Senator Cavanagh wishes to raise any further matters I will be happy to try to give information on them.
– The Minister having clarified those points, I will continue from where I left off on the administration of this Department. We now know that the Department administers the War Service Homes Act. So we are in order in discussing that matter as well as the housing loans insurance scheme under the estimates for this Depart- - ment. As the Minister has said. I have taken a great interest in the Homes Savings Grant Act and in home building, firstly, because I worked in that industry and, secondly, because I am concerned about the inability of home seekers to obtain homes in suitable locations at suitable prices. We should consider carefully what is the best means of assisting people to obtain homes because they put their life savings into homes, which sometimes are jerry built, and sacrifice for the rest of their lives in order to pay them off.
Since the 1963 election one of the Government’s contributions has been the Homes Savings Grant Act. I submit that it is time to review that Act and to see whether it has achieved what the Government expected it would achieve and whether it is the best means of assisting the home hungry public. The Minister is very proud of the latest figures which show that about 89,000 couples have benefited from this scheme. That figure must be compared with the 300,000 homes that have been built since the time of the inception of the scheme. Last year’s anual report on the administration of the Act showed that at least half of the advances were in respect of the purchase of existing homes and were not contributing to the building of further homes. The matter that I raise is the cost to the Government of distributing a lesser amount each year under this scheme. The report of the Auditor-General shows that in 1965-66 the amount distributed was $13,559,154 and that in 1966-67 it decreased to $12,027,017. These lower figures each year are not acceptable lo the public.
The statistics show that there are many difficulties in obtaining homes in spite of the existence of the scheme. The third annual report on the administration of the Act shows that in 1965-66 in New South Wales 16.3% of successful applicants required a second mortgage and the average second mortgage was $1,502; that in Victoria 13.2% required a second mortgage and the average second morgage was $1,455; in Queensland 3.9% required a second mortgage and the average second mortgage was $1,241; that in South Australia 30.6% required a second mortgage and the average second mortgage was $1,504; that in Western Australia 21.2% required a second mortgage and the average second mortgage was $1,452; and that in the Australian Capital Territory 59.3% required a second mortgage and the average second mortgage was $3,160. In 1966-67, in the Australian Capital Territory 71% required a second mortgage and the average second mortgage was $3,029. In view of those statistics. I ask whether the Government has assisted much.
If we look for something to blame, we may find it in figures set out on page 7 of the report. The figures are based on an assessment of information contained in a number of applications for grants lodged in March 1967. In these applications the cost of land was separated from the cost of the building. In New South Wales, in respect of 174 applications in the metropolitan area the average cost of land was $2,880 and in respect of 248 applications in the whole State the average cost of land was $2,411. In Victoria, in respect of 263 applications the average cost of land was $2,321. In Queensland, in respect of 116 applications the average cost of land was $1,511. In South Australia, the average cost of land was $1,837. In Western Australia was $2,151. In Tasmania it was $1,418. In the Australian Capital Territory the average cost of a 99-year lease in respect of seven applications was $954. The higher cost of land in New South Wales and Victoria is reflected in figures of the average value of building contracts. In New South Wales the average value was $8,976; in Victoria it was $8,932; in Queensland it was $8,344. In regard to the States in which the cost of land was lower, in South Australia the average value of building contracts was $9,351; in Western Australia it was $9,201; in Tasmania it was $9,825; and in the Australian Capital Territory it was $11,603. Those figures show that a higher price for land results in the construction of buildings of a lesser value. Because of the cost of land there is a limit on the amount that the would be home owner can spend on building a home. If the cost of land is high the amount available towards the cost of a home is reduced. There has been no attempt to arrest increases in the price of land. With respect to the Minister, 1 would say that this scheme is not readily acceptable. We have been told that some 89,000 grants under the Homes Savings Grant Scheme have been approved. There has been some liberalisation of the grants for the purpose of justifying a continuation of the scheme, which was the result of an election promise. I should like the Minister to comment oh the figures referred to in the Auditor-General’s report to which I referred earlier. I do not know why these cannot be clearly charged against this Department.
The Government, realising the need to obtain second mortgages for homes, established the Housing Loans Insurance Corporation with the idea of providing security for those who grant loans in excess of the amount that they were prepared to provide before the Corporation came into existence. Unless more money is made available for homes, this provision of extra money under second mortgages leads only to the provision of fewer homes. The lending institutions have not responded to the challenge. The growth of the Housing Loans Insurance Corporation has occurred in those places where building societies are in operation. I have had discussions on this question with the Secretary of the Combined Building Societies of New South Wales, and I am pleased to learn that these societies are in some cases lending up to 90% of the value of homes.
In the annual report of the Corporation we see a round diagram showing the number of loans insured. From this diagram it is clear that 60% of these loans relate ro used houses anc) not new houses. 1 raised this matter in the form of a question. 1 had information about some terrace dwellings in the Balmain area which needed renovation. There was a question as to whether they were fit for habitation. It was discovered that migrants who were anxious to find somewhere to live close to the city would buy these houses if they could arrange finance. The Housing Loans Insurance Corporation was a ready means of financing the purchase of such homes. So these pre-war rows of attached dwellings have be;n disposed of, with finance for the purchase being made available as a result of the security offered by the Corporation. But there is very little additional new construction. In 1966-67 only 32% of insured loans related to new houses, 5% related to home units and 3% related to other buildings. New South Wales accounted for 40% of the insured loans. In Victoria, as a result of the increase in building societies as stated in the report, the figure was 20%; in Queensland, 15%; in Tasmania and South Australia, each 7%; and in Western Australia 4%. The report comments on the fact that other institutions are not either seeking protection under the scheme or lending in excess of what they were lending previously. Surely this matter needs reconsideration, including the question of whether this insurance scheme provides a solution of the problem.
– Order! The honourable senator’s time has expired.
– I do not desire to make a contribution at this stage. I am interested in the comments that Senator Cavanagh is making and I take this method of making it possible for him to finish the points that he wishes to make.
– I thank Senator Morris for his courtesy. On the second page of the report is a graph which shows who is taking advantage of the scheme. In the chapter entitled ‘Source of Business’ the report states:
During 1966-67 the Corporation continued to receive outstanding support from building societies. Some 62% of all loans insured during the year ($24.7m) were Insured for this class of lender, proportionately a greater contribution towards the deposit gap problem than made by any other class of lender. The growth of the permanent building society movement in Australia is lapping new sources of private finance for housing, and the Corporation is pleased to be associated with this development. in South Australia at the present time we have some 600 Housing Trust homes that are empty and for which the Trust is looking for tenants or purchasers. They are in an area in which the average metropolitan worker cannot live.
– Have they been empty for a lengthy period?
– The paint is peeling off them. They are in the satellite town of Elizabeth which was the brainchild of the former Premier, Sir Thomas Playford. It is 17 miles out of Adelaide. With the transport facilities available, this is reasonably close for anyone who is working at a place between Elizabeth and Adelaide or in the city, but for a person who has to come to the city and then get transport to another suburb it is impossible to live in one of these homes. We have not the suburban transport that may be found in some other cities. These 600 homes, which are mostly for purchase on low deposits, are lying idle while there is a waiting list of 4 years for homes for rental or for purchase on low deposits in and around the Adelaide metropolitan area, where we see the exploitation that goes with every housing shortage, such as the renting of one or two rooms at high cost and the dividing up of rooms. While I think that the Minister is sincere in her belief that the Government’s measures are helping the people, we must face the question of whether they are helping those persons who can qualify for loans and the house-hungry public generally. Is the system assisting as much as the pegging of land prices would have assisted or some arrangement to halt the spiralling of costs? We would have assisted the individual more if we could have done that. I have reviewed the position of banking institutions and I believe we could have done more to assist the people if we had had some method whereby ready finance would have been available to those who wanted it.
I commend the building societies for their attempt to wrestle with this problem, but they have insufficient money. Although they are expanding, their rate of expansion is not sufficiently high. The waiting time for a savings bank loan is so long - sometimes 3 or 4 years - that when the loan does become available the person seeking it is unable to take advantage of it. because in desperation and possibly by reason of family considerations he has had to take other steps. The inability of young people to save the prescribed amount within the prescribed period means that they are not receiving the full benefits that were expected to flow to them when the scheme was introduced.
I have always maintained that there should be a thorough investigation into the whole subject of housing. The Chifley Government, which introduced the first Commonwealth and State Housing Agreement, conducted such an inquiry.
– In 1944.
– It was somewhere about that time.
– The committee of inquiry recommended the nationalisation of all home building land in Australia.
– All I am saying is that we should have an inquiry of some kind. Whether it be along the lines of the inquiry set up by the Chifley Government or an inquiry at which all interested persons can present their views is a matter for determination. I have discussed this matter with representatives of building societies and savings banks. They have plans for overcoming the housing problem in South Australia but none of them is confident that the Government has reached a solution of the problem.
I appeal to the Minister to consider the representations which have been made for such an inquiry. If there are dangers in an inquiry of the kind conducted in 1944, then let us have a different kind of inquiry. All of the recommendations of any committee of inquiry do not have to be adopted. Very many, but not all, of the recommendations of the Chifley Government’s inquiry were accepted. I remind the Committee that the Commonwealth and State Housing Agreement of that time, which is much better than the agreement at present in existence, was a result of the inquiry.
I know that the Minister is concerned about this matter. My main request is for information in relation to the cost of administering the homes savings grant scheme. We gather that there will be no further appropriations in respect of housing loans insurance because that scheme will be self supporting from now on. The main question exercising my mind relates to the cost of distributing some Slim in the form of homes savings grants.
Senator Dame ANNABELLE RANKIN (Queensland - Minister for Housing) [8.43] - Perhaps I can take this opportunity to endeavour to clarify some of the points raised by Senator Cavanagh. He mentioned figures appearing in the Auditor-General’s report and commented on the appropriation of $13,559,954 for 1965-66 as compared with expenditure in 1966-67 of $12,027,017. I have been informed that the first amount of over $13m was brought about by the backlag. This was taken up during that year and we have now reached a stage at which applications are dealt with as they are received. He also queried the departmental administration expenditure of $4,304,065 in 1966-67 as compared with expenditure of $3,910,285 in 1965-66. I am informed that the increase in administrative costs resulted largely from increases in salaries.
– What about capital works and services?
I have a note here to the effect that $59.1 m represents expenditure in 1966-67 on war service homes and that the sum of $250,000 was advanced to the Housing Loans Insurance Corporation. The honourable senator asked me whether the homes savings grant scheme is filling a need and assisting people to get a home. I believe that the scheme, with its tax-free gift to young people who qualify, is doing a great deal to assist young couples to acquire their own home. Because this money is held in what we term acceptable savings it is assisting in a twofold way. It is encouraging young people to save towards the purchase of a home because, by saving and fulfilling the requirements of the Act, they receive a tax-free gift from the Government, and in addition the method by which the money is being saved means that it is available for home building purposes. So I think it can well be said that the scheme is doing a great service in the community.
Senator Cavanagh appeared to me to believe that the statistics I quoted were insignificant. I remind the Committee that I said that 89,999 young couples had been assisted and that $39,960,650 had been expended. I disagree with the honourable senator. I think those figures reflect an excellent position. 1 believe that that amount of money is of value to young people. Almost wherever I go I meet young couples, or a young husband or a young wife, who have benefited from this grant. It is obvious that it has been of great assistance to them. I think we must all recognise the Act as a very useful piece of legislation designed to assist young people to get their own home and to encourage saving for that purpose.
I remind the Senate that the scheme has been extended. I recall Senator Cavanagh’s support when the Bill to extend the scheme to include eligible widowed persons with dependent children was before the Senate. I believe this will be of great assistance. In addition, from 28th November last we altered the requirement relating to the value of the house and land, increasing it from $14,000 to $15,000. Those are all very realistic approaches to this most important matter of housing our young people.
Senator Cavanagh referred also to the Housing Loans Insurance Corporation and in doing so made what I thought were one or two very interesting points. One of them was in relation to already built homes, existing dwellings as we term them. I point out that the effect of purchasing a house already built is frequently to permit the building of a new house or the purchase of a new home unit. There is no real reason to insist on people buying new homes. Many people want to buy old homes and settle in inner suburbs - I think Senator Cavanagh himself has made that comment - and by buying an old house the people concerned play a part in stimulating new construction.
The Housing Loans Insurance Corporation, I believe, has done since its commencement, and is doing, very excellent work in assisting in the purchase of homes. Senator Cavanagh quoted from the report of the HLIC. I wish to give the honourable senator some later figures than those contained in the report. These give the position as at 4th August of this year. From these figures we find that the total number of Commonwealth loans insured is 6,290 and the value of those loans insured at 4th August was $50. 6m. The State totals at that date are interesting. In New South Wales, 2,896 loans valued at $23.8m had been insured. In Victoria, 1,261 loans had been registered to a value of $9.6m. In Queensland, 884 loans valued at $6.9m had been registered. In South Australia, 419 loans to the value of $3.1m had been insured. In Western Australia, 293 loans to a value of $2.7m were registered, and in Tasmania 537 loans valued at $4.4m were registered.
I think that those figures show the value of the Housing Loans Insurance Corporation and the work that it is doing. These operations are designed partly to bring more money into the housing field. We believe that the Corporation is succeeding in doing just this. Building societies which are operating extensively under the scheme are steadily attracting fresh funds partly at least because of the increased public confidence in them due to the knowledge that their loans are being insured. This is quite evident in the work and the reports of the building societies. I do believe that the Housing Loans Insurance Corporation since its inception has played a very important part in assisting people to obtain their own homes.
I might also mention a few other figures that I believe are important. These figures are those that were available at the end of July. They reveal that home building activity throughout the year in relation to the number of houses and fiats commenced has been running at a reasonably satisfactory level. The figures for this year show the second highest level of commencements ever achieved. The commencements in 1966-67 stand at 1 14,804 and this figure is 7% above the 1965-66 level. I think that this shows a continuing and upward trend. In Victoria, Queensland, Western Australia and Tasmania the number of commencements in 1966-67 was a record. In New South Wales commencements were 5% above those for 1965-66 but were, of course, below the record level of 1964-65 when the figures were higher than the increase of 5% recorded in 1966-67.
I quite understand Senator Cavanagh’s concern about the situation in South Australia. This is a problem of which we are aware. The position there is indeed disappointing. I think that, overall, there is a continuing development and indeed growth in this field. It is a good thing to remind ourselves that Australia has a record in the field of home ownership. Our rate of home ownership is one of the highest in the world. This is a very important thing in this growing, young, developing country in which people are stretching out and building thenown homes in distant areas. This development is of tremendous importance not only to themselves but also, of course, to the growth of the nation. I believe, as Senator Cavanagh does, in the great importance of home ownership. I hope that the homes savings grant scheme will continue to give more and more people the assistance that they need because I believe that this is, in itself, of very great importance.
– I, too, feel that we should take some pleasure in the degree of home ownership that has been achieved in Australia. I believe that the figures for housing commencements in the last two years are such as to dispel completely the dispirited idea that housing is not being sufficiently encouraged. If the planners of 1960 whom some of us thought it was necessary to check had dreamed up those figures, they would have been astounded because they then were placing upon the annual building rate the artificial figure of, I think, approximately 87,000 or 90,000 homes. I speak again from memory when I say that I think that the commencement of homes at the present time is running at the rate of about 115,000 per year.
Having said that, I regret to be a little difficult in what I have to say in this part of my speech. I confess that I am rather persistent in this matter. It will be remembered that I found myself almost alone when the legislation to establish the Housing Loans Insurance Corporation was before us. I wanted a reconsideration of proposed section 5 of the statute which declared that the Minister may, by instrument in writing, declare that the class of persons specified in the instrument to be an approved class of persons for the purposes of the Act. I was joined by the Australian Labor Party in trying to bring that matter under the authority of the Parliament. We sought to substitute for an instrument in writing a regulation. Our purpose was not a tendentious legal purpose. It was to achieve a really beneficial result so that proper people who were interested in lending money for home finance should be the recipients of insurance under this scheme.
L would like those members of the Committee who have the 1967 report of the Housing Loans Insurance Corporation before them to look at this document which is unique even in this atmosphere because its pages are unnumbered. 1 refer honourable senators to the chapter beginning Approved Lenders’. Here the report states:
During 1966-67, a further eighty-seven lenders were approved to operate under the scheme, bringing the total number of lenders so far approved to 236. A complete list of HLlC’s approved lenders is shown at the end of this Report.
Then there are a few words of mutual congratulation as between the Corporation and those who have received its certificate. The last paragraph of this section reads:
At 30th June 1967 some 129 lenders had insured at least one loan with HLIC. Nineteen lenders had each insured loans totalling at least $300,000, and eight lenders had each insured loans amounting to more than Sim. While it is expected that many of those approved lenders who have not insured any loans with HLIC so far will shortly commence to make low-deposit loans, there are a number of approved lenders who, for one reason or another, seem unlikely to be able to make use of HLIC’S facilities in the coming year.
These words are significant. I do not say that they are improper but they are significant of the unerring direction in which authority to approve goes. The report continues:
It may be necessary to discuss with these lenders whether any useful purpose is likely to be served by their retaining approved lender status in these circumstances.
Once you have been given authority to select lenders, I would think that you would approve only those who were actually contributing to your purpose.
If one turns to the complete list of approved borrowers in the back of the report one sees that they are divided into certain categories. There are classes (a), (b), (c), (d), (e), (g), (h), (j) and (k). It is not stated from where those classifications come. I expect that the answer is to be found in one of these instruments in writing that are to be found under the blotting pad in the office of the Minister, not on the table of Parliament. The attitude seems to be ‘Let us not as Ministers condescend to say: “We approve of lenders by document which we will table in Parliament.” ‘ Here in the report we have a disclosure of the full list of members who have received approval from the Corporation in the last financial year.
Class (a) refers to private banks; class (b) refers to government banks; class (c) refers to life companies; and class (d) refers to co-operative building and housing societies. The last category is the only one to classify the societies by States. Class (e) refers to other New South Wales building societies; class (g) refers to friendly societies; and class (h) is categorised as follows: (Societies - (i) exempted, by an order under section 11 of the Banking Act, 1959, that is in force, from compliance with section 8 of that Act; and
The one solitary society listed is the Cairns Co-operative Weekly Penny Savings Bank Ltd. Class (j) refers to trustee companies Of all the great Australian trustee companies which, I should think, have contributed more moneys for home building than has any other class of financiers in Australia one trustee company has been approved, and that is Queensland Trustees Ltd. Why is that? Then we come to the most inexplicable enigma of the whole list of categories. Class (k) refers to mortgage management companies. They are described as consisting of three special classes. For some reason private individuals are not permitted to be approved. Only companies can be approved. Why is that? I daresay there are private individuals with quite a deal of money who would be glad to enter into the mortgage field. The three classes of companies which come within the category of mortgage management companies are those described in this way:
Companies carrying on the business of:
arranging, as agent for the lender oi the borrower, the lending or borrowing, as the case may be, of moneys the repayment of which is to be secured by a mortgage O’ er the interest of the borrower in the land;
collecting, as agent for the lender of moneys, the repayment of which is secured by a mortgage over the interest of the borrower in land, the interest and repayments on account of principal that becomes due and payable under the mortgage; and
ensuring, as agent for the lender of moneys the repayment of which h secured by a. mortgage over the interest of the borrower in land, that the borrower duly complies with the covenants contained in the mortgage.
They are the agencies which in the mortgage field arrange loans, collect instalments or inspect property.
– Did the honourable senator say that these are approved lenders?
– These are the liner categories of approved lenders. That is the way in which they are classified. Then their names are set out, but they are not set out State by State. I shall refer to a few of them. First of all, I refer to four which have been listed as approved lenders for Tasmania. They are the Beneficial Finance Corporation Ltd, the Cambridge Credit Corporation Ltd, the Development Finance Corporation Ltd and the Mortgage Investment Corporation Ltd. 1, having only a somewhat exiguous contact with the mortgage investment part of a solicitor’s business, have never heard of any one of those companies making a loan in Tasmania. They may be reputable people. They may have a lot of money. They may be bona fide in their intentions to establish themselves in Tasmania. But how did they get their approval? By what performance did they merit classification by the Minister as approved lenders? I shall refer to one or two of the other intriguing names. There is the WAN Nominees Pty Ltd. As Senator Webster is present with us, I mention also Webster Investment Pty Ltd. I wanted this matter to be subject to regulation so that we could disallow any regulation that was intended to include scrubber corporations. A completely artificial and arbitrary category of financiers is listed in this report. I do not know anything at all about them. What is there about that particular category of lenders which merits their being classified as approved lenders, rather than the great trustee companies which, as I have said, for years have been performing a great service in providing money to build homes for individuals?
I said that I did not wish to be other than myself tonight. Therefore I wish in no way to disguise the fact that I am persistently being difficult in this matter, but not as difficult as I will be on the next occasion. In my view I have said sufficient tonight to make it imperative that the Housing Loans Insurance Corporation makes its services available to everybody of credit in the community, in the same way that that person can go and arrange his business with the Commonwealth Bank. Any such lender of money for home building purposes should be able to go to the Corpora tion on the merits of his investment and his credit and get insurance for his loan. I find nothing in the list of companies to which I have referred that prima facie disposes me to think that they have the slightest characteristic which earns them approval in this field. When I read in the report that 129 members had insured one loan with the Corporation up to date and that others cannot be approved, I think it is time that the Parliament supervised the operations of the Corporation.
– Order! The honourable senator’s time has expired.
– I will not take up too much time, but there are a couple of points that I want to raise. I refer to the item under Division No. 260 which deals with the amounts that are to be received from war service homes purchasers and borrowers in respect of technical and legal services. These matters are all set out in detail in the annual report of the Director of War Service Homes. One thing that is becoming more striking each year is the overall decrease in the arrears of instalments. This year, the amount is remarkably low and it is interesting to note that the State with the lowest average of arrears per account as at 30th June 1967 was South Australia, whore the figure was $2.65. It is obvious, therefore, that the financing of war service homes is a profitable venture and I draw the Minister’s attention to the paragraph of the report which reads:
During the year the number of current loan accounts increased from 179,800 to 183,276.
Despite this increase the arrears of instalments decreased. Because this seems a profitable venture I suggest that the Minister consider the desirability of persuading the Government to increase the maximum loan to something above the current maximum of $7,000.
I should like to refer to another matter. It relates to the statement on page 4 of the report, the second paragraph of which reads:
A total of 452 eligible persons were granted assistance in New South Wales in 1966-67 to purchase home units . . .
Further down the report states:
Buyers, too, often fail to appreciate that th« need to climb up and down stairs may prove unacceptable in later life and increasing numbers of applications for second loans are being received from purchasers and borrowers who have been granted assistance for a home unit and now find the unit inappropriate for their needs. 1 should like to know in how many instances people who have found it difficult to live in home units because of advancing years were granted second loans to acquire appropriate accommodation.
Yesterday I asked about houses for Aboriginals. I think the Minister probably misunderstood the question, but I did not ask it again today because I knew that this debate was coming on and I would be able to avail myself of the opportunity offered then. I refer in particular to Thursday Island. I know of only one local resident in this area who has a war service home. It is possible that some of the indigenous people, some of the original Torres Strait Islanders, may be eligible for assistance. One of the greatest problems associated with the assimilation and integration of Aboriginals is housing. The Minister quite rightly said yesterday that this was a State responsibility. But I should imagine that it will be found that it will be possible for the Commonwealth, under the new constitutional powers granted to it with respect to Aboriginals at the recent referendum, to find some way of assisting in the housing of these people. They do not ask for housing in the mansion class, but what they do get is often sub-standard. This is quite an involved problem. There is quite an amount of land available on Thursday Island, Horn Island and other parts of Australia which could be released for the housing of Aboriginals if the Government could find some way under the new powers conferred upon it by the referendum to make funds available for this purpose. I do not know whether this is possible, but it is up to the Government to investigate the matter. When land has been released in the past it has always been snapped up by speculators who have built sub-standard houses and let them to the Aboriginals at exorbitant rentals. This is not only of importance to the Aboriginals themselves; it is a matter which is of great social significance, and if the Commonwealth could find some way of providing funds to help these people in the manner in which I have suggested, they will be very grateful indeed.
Senator Dame ANNABELLE RANKIN (Queensland - Minister for Housing) [9.15] - I shall deal first with the points raised by Senator Wright. I have the answers to one or two, and investigations are being made with relation to the others. I shall answer them later when the information is available. Senator Wright referred first to the approval of lenders. When 1 answered the honourable senator on this point yesterday I said quite correctly that the responsibility for approving individual lenders rested entirely with the Housing Loans Insurance Corporation. I think the point to which the honourable senator was referring, however, related to the approved classes of lenders. The declaration of classes of lenders is the responsibility of the Minister.
The honourable senator also mentioned instruments in writing. This provision has been in the legislation from the establishment of the Corporation and the Government has agreed to table any such instrument in writing for the information of the Senate. I remind the Senate that recently I tabled an instrument dealing with non-life insurance companies. They are now an approved class of lender.
– What was the class?
– Non-life insurance companies. I tabled an instrument in writing concerning them on 16th August of this year. The honourable senator had an opportunity then to take note of the instrument, or to comment on it. As I have said, the honourable senator raised one or two other points. I am having inquiries made about them and will reply to him as soon as the information is available.
Senator Keeffe referred to the maximum amount of war service homes loans. As everybody knows, this is a matter of Government policy. I cannot give any further reply than that. He spoke next of housing for Aboriginals. He mentioned that Commonwealth land was available on Thursday Island. I do not know anything about this land. I cannot give the honourable senator an answer about it. I do not know what department holds it, nor do I know whether it is being held for some particular purpose.
– It is held by the Department of Defence.
– I know nothing of it personally. As I stated in my reply yesterday, the housing of Aboriginals is the responsibility of the States. The Queensland Government is doing excellent work in the field of housing all through the northern part of Queensland.
– Not the Aboriginals.
– I am sorry to contradict the honourable senator, but I went through this area just before Easter. Right at the tip of Cape York Penninsular at Bamaga, and at Yam Island in Torres Strait, I saw some very good houses. They were well built cottages that were beautifully cared for by their owners. They had most beautiful areas round them. One would not call them gardens as we know gardens here, where the spring flowers are blossoming just now; they were areas with brilliantly coloured tropical shrubs, and at that time the hibiscus was in bloom. They were all beautifully cared for. There were houses built of wood and houses built of what I think was aluminium. At Bamaga, I remember, there were particularly good cottages for some of the senior people. The floor was on ground level and they had well divided rooms and were suitable for people of advancing years.
– But this is for only a few people.
– This work is continuing all the time. This shows the promise that is in the work being done by the State Government. Of course, we want more and I feel sure that this will be a continuing programme as and when the homes can be built. I want to remind the Committee that this matter has not been completely overlooked, but this is a matter for the State Government and I believe it is very aware of its responsibility.
The honourable senator also mentioned war service homes for the islands north of Australia. As I recall his comment, I think I am quite correct in saying that if those people are eligible persons under the Act, if they fulfil the conditions required under the Act, then they have the same assistance as is given to anyone living anywhere else. But they must, of course, fulfil the necessary requirements for eligibility under the Act.
– Anyone associated with the activities of the building industry, would, I think, congratulate the Minister for Housing and the Department of Housing on the promotion of ideas which, over the past year or so, have added substantially to the benefit of the industry. As I have said in this chamber on a number of occasions, this industry, to all intents and purposes, is a key industry in Australia’s economy because from the house building industry flow the activities of nearly any industry one likes to mention. There are some very interesting figures included in the annual report of the War Service Homes Division. They relate to housing costs in the various States and these figures are very important.
– On what page do these figures appear?
– They are shown at page 25 in appendix K. I only draw attention to this matter because the Minister may make some comment to me about the costs stated in the report. I would like to know how the War Service Homes Division justifies the terrific costs generated in some areas in relation to the construction of homes. I will read a line from appendix K. which states:
The average cost of homes erected under the War Service Homes Act during 1966-67 as compared with 1965-66, covering both land and dwelling house, was as follows:
I will read the 1966-67 figures relating to a dwelling house only. The average cost for each State was as follows:
The lowest cost average for a house was in Tasmania. I would like the Minister to advise me of the position. Are the differences due to the incidence of the cost of land? I imagine they are not. Is it the incidence of the cost of materials, or the cost of labour, or the cost of a much better home - as is being provided in the Australian Capital Territory - than one would find in, say, a State far removed from what it believes is the hub of activity, such as Western Australia? Doing a quick calculation, I find there is a difference of well over 33% in the cost and I think this requires some explanation.
– The average is $1,000 more than it was the year before.
– Yes. Senator Wright brought up a point about the Parliament wishing to know something of the people and the class of people who are being approved by the Government as lenders of money for home building. I take it that the Minister’s comment was that the Parliament has the right to know. She has been very kind in tabling the classes of approved lenders but it is the duty of the Housing Loans Insurance Corporation to approve the individuals. This still comes under her responsibility, I imagine. When the Bill creating the Housing Loans Insurance Corporation was introduced I said that I was particularly concerned about the Government going into the matter of insuring a person who was to be an approved lender and who might go into association with some organisations which at that time I knew were under query. I think reference to Hansard will show that this was my point of view. The Minister may be able to help my thoughts by informing me what is the lowest paid up capital of any particular lender listed by the Corporation as an approved lender.
– Webster Investments?
– It just well may be because if we are to judge by some of the names that are here I would not know in actual fact what elevation the various companies have. The Minister mentioned that she had approved one class of lenders recently. I think she used the words ‘noninsurance companies’.
– Nonlife insurance companies.
– They should appear as a class in this report, should they?
– No, this was only done in August.
– Only in August. But the words ‘non-life companies’ represent to me only a blank explanation of what is involved. I admit that I have not looked closely at the paper tabled by the Minister but the words ‘non-life companies’ mean any company to me.
– Nonlife insurance companies.
– The point is that when this matter was first introduced in this place, the Reid Murray Finance Corporation and the Stanhill Finance Corporation were shows about which the average person wishing to secure money would say: Here are companies that are well worth having Commonwealth Government backing for their loans’. There was some debate at that time as to what would happen if the companies having the benefit of Commonwealth security got into difficulty because of some of the activities they were undertaking. I held the view at the time that it would be a fairly small group of individuals who would eventually become approved lenders and that they would be of substance. There are about 200 names in the list of approved lenders. Perhaps the Minister could advise me about this so that my questions need go no further. Can the Minister advise me what is the actual figure of the lowest paid up capital value of any approved lender accepted by the Corporation?
– There are two questions I would like to ask the Minister. I refer to Division No. 260, which relates to the grant for the Australian Council of Co-operative Building and Housing Societies. The appropriation and the expenditure for last year was $3,000 and the same amount is allocated this year. Would the Minister obtain some details of the grant to the Australian Council of Co-operative Building and Housing Societies? The Australian Association of Permanent Building Societies received a grant of $2,000 last year but is to receive nothing on this occasion. What was the grant and why has it been discontinued?
In the report of the Auditor-General, in relation to the National Welfare Fund, mention is made of the Commonwealth and State Housing Agreement. Contribution to rental losses in 1965-66 is shown as $213,465 and $141,799 in 1966-67. Could the Minister obtain some information on those payments from the National Welfare Fund? I do not know whether the Minister for Housing is the appropriate Minister to do so, in view of the source from which the money is paid. If possible, could the Minister ascertain the States to which the continued contribution for rental losses is paid?
Senator Dame ANNABELLE RANKIN (Queensland - Minister for Housing) [9.31] - 1 will answer Senator Cavanagh’s queries first. He mentioned the National Welfare Fund - Commonwealth and State Housing Agreement - contribution to rental losses. 1 gave this information earlier, but I shall repeat it. Expenditure in 1966-67 was $141,799. The estimate for 1967-68 is $45,000. The 1945 Commonwealth and State Housing Agreement makes provision for the Commonwealth to share with a State a cash loss that may bc incurred in any financial year in the administration of rental housing projects erected by thai State under the 1945 Agreement. The Commonwealth’s contribution is 60% of the loss incurred, subject to the State meeting its obligations under the Agreement, including the charging of economic rentals. Rental rebates granted according to a formula laid down in the Agreement are allowed as part of the loss. The provision made for 1967-68 relates to a payment to be made to the State of Queensland for operations during 1965-66.
The honourable senator also asked me a question concerning the estimated amount of $3,000 for 1967-68 for the Australian Council of Co-operative Building and Housing Societies and the payment of an amount of $2,000 in 1966-67 to the Australian Association of Permanent Building Societies. I will deal first with the grant of $3,000 to the Australian Council of Co-operative Building and Housing Societies. Since 1958 a grant of this amount has been paid each year, with the Treasurer’s approval, to assist the Council to promote the development of building and housing societies in Australia. The grant in 1967-68, as in previous years, will be paid on the approval of the Minister for Housing only after the Minister is satisfied that the Council has carried out the conditions agreed upon for the grant. Concerning the $2,000 appropriated and expended in 1966-67, the Australian Association of Permanent Building Societies was formed in 1964 to encourage and aid the nationwide development of the permanent building society movement and thereby pro mote a greater flow of funds from private sources into housing. A grant of $2,000 was made in 1964-65 in respect of the Association’s financial year ended 31st December 1965 to assist the Association in its formative stages, and a further grant was made for the same purpose during 1966-67 in respect of the Association’s financial year ending 31st December 1966. The Association became self-supporting from the beginning of 1967 and no further grant by the Commonwealth was deemed to be necessary.
Senator Webster commented on the average cost of homes under the War Service Homes Act. The relatively high cost of such homes is due mostly to the fact that there is a better standard of home. Eligible persons under the Act in most cases are moving into the middle-age bracket and have had a number of years in which to build up a deposit. A big percentage of applicants today have previously owned homes - not war service homes - which they have sold and with the equities realised upon sale are able to provide larger deposits and thus build larger and better homes than many other members of the community.
– Is that statement in relation to the Australian Capital Territory?
– lt applies generally.
– I made the inquiry concerning the increased cost of at least one-third in the Australian Capital Territory as compared with Western Australia.
– I am sorry, I missed the point. The comments which I have already given concerning costs apply generally but more particularly to the Australian Capital Territory. Senator Webster asked me a question concerning the point that 1 made in answer to Senator Wright. Perhaps I did not make the point clearly enough. The responsibility for the approval of individual lenders rests exclusively with the Housing Loans Insurance Corporation. The approval of classes of lenders is the responsibility of the Minister. The point 1 made was that the document tabled declared non-life insurance companies to be an approved class of lender. The approval of classes of lenders comes under the responsibility of the Minister. The approval of individual lenders is the responsibility of the Housing Loans Insurance Corporation.
– Earlier this evening, in reply to Senator Cavanagh, the Minister stated that the fall in the amount of money made available under the Homes Savings Grant Act was due to some backlog of applications or amounts that had been accumulated for various reasons. The Minister gave no indication of the full extent of the backlog. Having regard to the fact that one would expect an increase in expenditure, an increase in the u umber of young people in the community and an increase in demand, one is rather disturbed to see that the amount made available has fallen by some 1 1 % or approximately $ 1 ,460,000. Earlier I expressed the opinion that there is a disincentive to saving brought about by the exclusion of the availability of State housing accommodation for people who wish to make use of the homes savings grants. Those people are virtually forced into a higher field of housing than is desirable in many cases because if they want to qualify they are debarred from State and Federal housing assistance. I believe that this exclusion obstacle is defeating one of the purposes of the Act, which is to encourage saving. If young persons enter into a field of housing beyond their means it is socially undesirable and can create many problems. I urge the Minister to have an investigation made of that aspect of the operation of the Act. 1 was interested to receive from the Minister some time ago figures on the number of homes savings grants made to persons engaged in agriculture. I would be pleased if she could let me have the current figures in that regard, showing the extent to which such persons have been availing themselves of the homes savings grant scheme. The figures that I was given previously showed that 1,000 grants out of 77,000 - abou: 11% - were made to persons engaged in agriculture. When we realise that the proportion of young people in the community engaged in agriculture is 11%, we quickly see that some major factor is operating against their use of this form of assistance. I cannot let this opportunity pass without commenting that the Housing Loans Insurance Act still does not operate in regard to people engaged in agriculture. I know that this is a matter of policy. I have discussed it with the Minister. I must place on record my complete disappointment that it has not yet been found possible to devise ways and means of enabling the whole community to benefit from this Commonwealth legislation.
– [ wish to dissociate myself from the view that Senator Prowse holds. I believe that sufficient incentive has been given to people to purchase government homes under other legislation and that that is the real reason why people who do so are excluded from the homes savings grant scheme.
– I am only putting a point of view briefly. I. will be glad 10 hear the answer to that point of view. I rose to ask two specific questions about the Housing Loans Insurance Corporation. The first is: Where can we find the scale of premiums that the Corporation charges lenders? Is the premium a matter of quotation for each individual transaction or has the Corporation published a scale of premiums so that all approved lenders know whether they are able to do business with the Corporation? The second is: Has the Corporation made any stipulation as a condition of granting insurance that the loan must bear less than a specified maximum rate of interest? I want to know the actual terms that have been stipulated for the Corporation’s insurance in relation to the interest charged to the borrower under the mortgage.
Senator Dame ANNABELLE RANKIN (Queensland - Minister for Housing) [9.44] - I may have misled Senator Prowse a little when I was referring to the figures which are contained in the AuditorGeneral’s report and which Senator Cavanagh quoted. He mentioned that in 1965-66 the total amount of grants made was $13,559,154 and that in 1966-67 the total amount was $12,027,017. I said that the larger amount in 1965-66 resulted from a backlog of applications. The explanation that I gave was in respect of the fall from the expenditure in 1965-66 to that in 1966-67. That fall was due to a large backlog of applications on 1st July, 1965, when about 8,000 applications were on hand. The number of applications on hand was cut back until at the end of 1965-66 only 4,000 were on hand.
The appropriation for 1967-68 is larger than the expenditure in 1966-67. The actual expenditure in that year was $11,885,218. The appropriation for 1967-68 is $13,200,000. That estimate has been made having regard to the current intake rate of applications and making an allowance to cover the estimated population increase and the increase in the number of applicants who will become eligible for grants as a result of the amendments made to the Homes Savings Grant Act in May 1967. Senator Prowse asked for the current figure on grants in rural areas. I am sorry that I have not that figure with me tonight, but I will obtain it for him. I know of his great interest in this matter.
Senator Webster spoke about the criteria laid down by the Housing Loans Insurance Corporation for the approval of applications for approved lendership. The Corporation has not laid down any objective criteria by which it should determine applications for approved lendership Rather does it grant approved lendership to those applicants which in its judgment are likely to be able to carry out the functions of approved lenders. In considering applications for approved lendership the Corporation looks to the good reputation of the directors and management, the financial stability of the organisation and the management’s experience and capacity in mortgage lending. Approved lendership merely gives the lender the right to submit insurance proposals to the Corporation and to manage mortgages that have been insured by the Corporation. Each individual application for insurance is judged on its merits and must meet the Corporation’s criteria as to interest rate, ratio of loan amount to valuation, borrower’s repayment capacity and so on.
– I wish to comment on a couple of statements that the Minister made in her replies. She replied to Senator Prowse in respect of the figures that she gave me on the reduction from the figure of more than $l3m paid out in homes savings grants in 1965-66. I do not doubt that there was a backlog, as she said there was. In 1966-67 the amount paid out was reduced to $12,027,017. That was a reduction of about $1.5m. The figure for this year is only an estimate. Since the commencement of the scheme the grant payments have decreased year by year. I have not looked up the figures to see whether the number of applications has decreased or whether the amounts of the grants have been decreasing.
The Minister mentioned a backlog. I ask her to consider whether there are more rejections of applications today than there were previously. When this scheme came into operation money held anywhere was counted as savings. Since then the money has had to be held in a certain form, lt is reasonable to expect increased payments this year because there has been some liberalisation of the scheme but whether it will attract the same section as it attracted previously is another question. The Department says at page 7 of the annual report:
Despite the widespread publicity that has been given to the Scheme since ils inception, ti is evident that many young people are still unaware of the basic conditions that must bc satisfied before a grant may be paid. Many applicants failed to qualify for a grant, or for the maximum grant of $500, because they had not held their savings in a Home Savings A ceo urns or in one of the other approved forms for the minimum period of 3 years. When young people commence to save they would be well advised to pui their savings into a Home Savings Account wilh a bank, or with a building or housing society.
The purpose is to make more money available for home builders. I have had some dealings with young people in relation to this scheme. When one yoting couple commenced to save they put the money in a local savings bank. It was banked through their employment agency. Upon marriage they decided to put the money into the Homes Savings Grant Scheme, but they had not the necessary qualifications and so missed out on portion of the grant. 1 wonder what is the value of insisting that the savings be in a particular bank in a deposit marked ‘Home Savings Account’. A savings bank would put money towards housing whether it was in a particular scheme or not. Perhaps this scheme could be made attractive to people who commence to save without the thought of purchasing a home but later decide to purchase a home, if their money is in an institution that lends a proportion of savings for housing. Why should there be an insistence that the money be in a special account? Senator Webster was told that the higher cost of homes in the Australian Capital Territory was the result of the building of better class homes.
– Did the Minister say that?
– I said that some were of a better standard.
– That was a suggestion by Senator Webster.
– If there is any confusion, 1 do not know whether 1 am trying to correct the Minister or Senator Webster, but one of them needs correcting. I think Senator Webster was talking about war service homes in Canberra, of which I have no knowledge. I inspected a building site in Canberra on one occasion with the representatives of the Building Trades Union and because time was limited I promised to make a thorough investigation of other sites. The construction of the homes in Canberra that I saw would not comply with the building regulations of most States. Homes in Canberra are not superior and in many cases are inferior to those that State housing authorities are building at present. I saw’ 3 x li rafters without hangers, with under purlins of 3 x 2 poorly soldered up, holding ceiling joists of 2 x 14 spaced 2 feet apart. Not only are these houses inferior, having a short life without maintenance and repair, but also there is some element of danger. When they have heavy tiled roofs there is an acute danger. This is happening in Canberra.
– Did the honourable senator refer to ceiling joists 2x1)?
– Yes, spaced 2 feet apart. I suggest that the Minister and her officers should consider the requirements and building regulations of State authorities and see whether Canberra houses would comply with them. I do not know what are the requirements of the legislation in Canberra, but the type of group building being constructed in Canberra cannot be claimed to be superior to houses in most States.
Senator Dame ANNABELLE RANKIN (Queensland - Minister for Housing) [9.56] - First, I have some information for Senator Wright. The basic premium rate is a once and for all payment of 2% of the amount of the loan. The rate is reduced marginally in cases .where the loan insured represents less than 75% of the valuation of the dwelling being bought or built. The premium is normally payable by the borrower, but the lender may agree to add it to the principal sum of the loan. The maximum permissible rate of interest on an insurable loan is 7i% per annum. That matter was raised by either Senator Wright or Senator Webster.
asked about applications for home savings grants which were rejected. In the year 1965-66 12% were rejected. In the year 1966-67 this figure was reduced to 8.2%. Because of the amendments which have been brought in and because cases are being continuously reviewed in the light of these amendments, we believe that quite a number of the 8.2% rejections in 1966-67 will not indeed remain rejections and the applicants will be receiving a grant. Senator Cavanagh spoke also of the designation of accounts as Home Savings Accounts. This in itself is designed to help achieve the objective of consistent saving towards a home. I I think this is a very important thing. To the extent that it succeeds, it helps to achieve the other objective of increasing the volume of long term housing finance. The positive act of having an account designated as a Home Savings Account shows that a person is aware of the scheme and desirous of participating in it. The designation in his pass book keeps the scheme before his mind on each occasion that he operates on his account and it is a reminder of the need to build up his savings over the required minimum period of 3 years until he reaches a point where he will receive full benefit from the scheme. If the designation of the account was not required, the grant would be paid in many instances merely because a person happened to have his savings in a savings bank account even though he had no conscious intention of saving towards a home. We believe that the special designation of an account as a Home Savings Account has an excellent effect in making a young person conscious of the continuous need for saving towards a home and of the additional benefit that he can obtain.
– I should like to repeat the question I asked the Minister In relation to the number ot second loans that have been granted where people, because of advancing age or for some other physical reason, are unable to continue in home units in which they have to climb stairs and so on. Is it possible to obtain this information? I know how hard it is to get a second war service loan in normal circumstances.
Senator Dame ANNABELLE RANKIN (Queensland - Minister for Housing) [10.1] - I am sorry I omitted to reply to that question. I cannot state the number. My advisers tell me that the number of persons in that category is not specifically separated from the others, but I can tell the honourable senator that since I have been Minister there have been cases in which people in extreme circumstances because of health reasons have been given second assistance.
– Does that mean that this has never been recorded?
– It has been recorded, but we do not have individual details.
– The information is not readily obtainable but it can be obtained?
– lt would be difficult. The numbers would be recorded but I would have to find out whether they were divided into specific categories.
– I mentioned a second loan in cases where people were unable to cope because of physical disability.
– I am certain there would be an overall figure, but I would have to make further inquiries to see whether I could obtain the information in relation to home units.
– I refer to Division No. 260 - Administrative - to raise a matter of policy and to mention a matter relating to the administration of the War Service Homes Division. Doubtless the Minister has received a number of representations over a period from honourable senators and members of another place seeking an increase in the maximum amount available for a loan under the War Service Homes Act. I was one of those who earlier this year made such representations. On 27th
June last year the Minister replied to me by letter. Amongst other things she said:
The Government fully reviewed this matter in 1962-
Which is some five years ago - and increased the maximum war service homes loan to $7,000. Since then experience has shown that this amount, together with the cash deposit an applicant is required to provide from his own resources, is usually sufficient to enable him to obtain a home satisfactory to his requirements. Only a small percentage of applicants have found it necessary lo seek approval to raise supplementary finance by way of second mortgage.
I emphasise the point that the Minister was making in her letter to mc, that only a small percentage of applicants had found it necessary to seek approval to raise supplementary finance by way of second mortgage. The Minister went on:
The Government has decided that for the time being it is better lo continue with the present arrangements which are aimed at ensuring that the greatest number of ex-servicemen seeking homes are satisfied. However, you may be assured that the Government will review this matter again at Budget time.
As I have said, that letter was dated 27th June. When the Budget was presented on 15th August the Treasurer (Mr McMahon) had this to say in relation to war service homes:
Because of the number who have already taken advantage of the war service homes scheme, it seems likely that there will be fewer applicants for advances this year. The provision has therefore been reduced to $4S,S00,000 which is $13,600,000 less than the amount disbursed last year. 1 set out that historical background to lead me to the point I intend to raise, that is, the question of supplementary finance being made available by way of second mortgage. The Minister for Housing has said that, generally speaking, the experience has been that $7,000 has been sufficient to provide an ex-serviceman with enough finance to provide a home for himself and his family, having regard to the amount he can put down by way of deposit. Recently I asked a question on notice of the Minister concerning some statistical information relating to war service homes. Among a number of other questions I asked:
How many applications have sought approval to raise supplementary finance by way of second mortgage?
My question related to each of the years since 1960. The Minister replied:
Statistical derails relating to the number of applicants given approval to raise supplementary finance by way of second mortgages were not maintained prior to January 1966. Statistical records maintained since then show that of 8,983 applications settled from 1st January 1966 to 31st December 1966, a total of 1,151 applicants were given approval to raise supplementary finance.
This means that of almost 9,000 people who applied for supplementary finance by way of second mortgage only one-eighth were regarded by the Department of Housing as eligible to receive the added assistance. I suggest seriously that on the figures supplied by the Minister herself the maximum loan of $7,000, which amount has remained unaltered since 1962, simply is not sufficient in this year 1967 to provide the wherewithal to purchase a block of land and to build a home thereon, having regard to the deposit available to the ex-serviceman or ex-servicewoman as the case may be. 1 should like the Minister to explain why only 1,151 applicants out of a total of 8,983 were able to receive supplementary assistance by way of second mortgage, particularly in view of the Minister’s statement in her letter to me of 27th June to the effect that the Government had decided that for the time being it was better to continue with the present arrangements which were aimed at ensuring that the greatest number of ex-servicemen seeking homes was satisfied, and in view of the Treasurer’s statement in his Budget speech that it seemed likely that there would be fewer applicants this year for advances.
Why cannot some of the restrictions which to date have been imposed on applicants be lifted? For instance, I have in mind the single or widowed ex-serviceman without dependants who, I understand, is unable to secure assistance for the purchase of a home or flat. We must bear in mind that the amount available under the war service homes scheme has been reduced by $13,600,000 in this financial year.
Also, why is it that former members of the women’s Services who were given FX numbers but who in fact did not serve overseas are ineligible to apply for the war service home loan? Also ineligible are NX numbers and VX numbers who In fact volunteered for overseas service but did not serve overseas. I would like to know whether the restriction still exists on eligibility for the war service home loan in respect of those members of the Citizen Military Forces who served in the Darwin area or north of Latitude 14 degrees, I think, during the Second World War? I understand that there are one or two other restrictions that from time to time have been imposed by the Department. What I am suggesting is that if there are at this stage fewer applicants for assistance under the War Service Homes Act there is no justification for the Government reducing the amount of the vote by $13,600,000, having regard to the fact that there were some 8,983 applicants for second mortgage assistance and only 1,151 of them were able to be satisfied. Those, generally speaking, are the matters about which I wished to speak.
In the ‘Canberra Times’ of 23rd August last I read an article attributing to the President of the Housing Industry Association, Mr K. L. Driscoll, a statement that a proposal to raise standard housing loans by banks and life insurance offices from the present amount of $7,000 to a limit of $9,000 would be studied by Treasury officials. Mr Driscoll has made a submission, to the Federal Treasurer (Mr McMahon) and to the Minister for Housing on this matter. I ask: In the event of a decision to allow a loan of $9,000 to be made by banks and life insurance offices, will the Minister do all that is possible to ensure that the maximum amount of $7,000 now available to ex-servicemen will likewise be lifted to $9,000?
Senator Dame ANNABELLE RANKIN (Queensland - Minister for Housing) [10.13] - I wish to clear up a point made by Senator Cavanagh concerning the cost of the construction of war service homes in Canberra. My comments related to the construction of war service homes in Canberra for eligible persons under the War Service Homes Act. The average cost of those homes, I am informed, was based on twelve homes only and could not be said to be representative of the cost of home building in the Australian Capital Territory. The average cost of those homes exceeded the average cost of homes built in other States because the homes in the ACT were larger and better equipped than war service homes constructed in the States. This reply relates to the points originally raised by Senator Webster. This was an added point raised by Senator Cavanagh.
Senator McClelland spoke about the amount of the war service homes loan. This, as I said to Senator Keeffe earlier tonight, is a matter of Government policy. Therefore, I cannot reply to the question asked by Senator McClelland. As I said in my letter to the honourable senator, this matter is reviewed from time to time. This applies also to the other matter raised by the honourable senator concerning single ex-service persons. Senator McClelland made a comment concerning eligibility to which I would like to reply. The honourable senator commented on the fact that exservicewomen could not receive a loan under the War Service Homes Act. He asked why this was so. The eligibility conditions for war service home loans are the same for ex-service persons be they male or female.
An eligible person is defined in the War Service Homes Act. An eligible person includes a member of the Australian forces and nursing services enlisted or appointed for or employed on active service outside Australia or in a ship of war during the 1914-18 or 1939-45 Wars and subject to prescribed conditions a person who served in Korea between 17-6-1950 and 31-8-1957, in Malaya between 29-6-1950 and 27-5-1963 or who has served on special service defined in the Repatriation Special Overseas Service Act 1962-1965. A certain number of other persons are included in the definition of eligible persons. Included is a widow and in some cases the widowed mother of an eligible person. The eligible person of whom I am speaking must be married, about to bc married or have dependants for whom it is necessary to maintain a home. These conditions apply to men and women. Applicants must be eligible under the War Service Homes Act and qualify under those conditions.
Another point that the honourable senator made concerned second mortgages. If I may say so, there seems to have been a little confusion in the figures quoted by the honourable senator.
– I was only giving the answer that the Minister gave to me.
– Yes, but when the honourable senator quoted it to me I thought there was confusion in it.
– I read it verbatim.
– Might I say then that it did not come over very clearly on this side of the Committee. In relation to the number of persons who applied for permission to raise a second mortgage from a private source to supplement their war service homes loans, I am informed that most applicants are able to proceed on the basis of the maximum war service homes loan of 57,000. Of the total number of applicants applying for assistance only about 17% find it necessary to raise supplementary finance by way of second mortgage. The balance is able to provide the difference between the purchase price of the home and the war service homes loan of $7,000 from cash savings accumulated over the years. This percentage, I felt, was not conveyed in the comments that have been made.
I wish to comment also on the very splendid service provided by the war service homes scheme. Not only does the scheme provide a loan at a low interest rate over a long period of years but also other advantages ‘are made available to applicants who receive such a loan. I do not believe that we should think only of the amount of the maximum loan. We should recall also the low interest rate and the long term period of the loan. We believe that this is indeed a repatriative service which is doing a great deal to assist and indeed for 50 years now has assisted ex-service people in this country.
– 1 desire to refer to Division No. 260 - Administrative. I make the comment that there is a modern tendency regarding housing for people to live in flats or units. Now, regarding a title for the usual flat or unit, we find that the lands title system of the State or Territory in which a person lives is regulated by what is known as the strata title system. Strata titles are being used in increasing numbers throughout Australia. One by one the States in their lands titles registration office are bringing in this system of strata titles.
I think that it would be of great benefit to many people to live in a flat or unit, especially people who are advancing in years. I would say that the average age at the present time of a new applicant for a war service home who fought in the last World War would be between 50 and 60 years. Also widows who are now being brought in under the grants system might have few children and might appreciate the smallness of a flat or unit. I submit to the Minister that it is very important that the Commonwealth should give immediate attention to a system of strata titles so that it can take the requisite mortgage from the holder of a strata title.
This system had not developed some years ago when I raised the question during the debate on the estimates. But from my general knowledge I know that the system of strata titles is now developing throughout Australia. Can the Minister indicate to me whether her Department recognises strata titles in either Housing Loan Insurance Corporation activities or war service homes activities? If so, in what States does her Department recognise strata titles? Does her Department have access to strata titles in the Northern Territory or the Australian Capital Territory, which are under the direct control of the Commonwealth? Can the Minister tell me what the general position is? Can she tell me whether her Department has had any active discussions wilh the sovereign States, which control land titles registration systems? Has the Department had any discussions with the Department of the Interior regarding the Australian Capital Territory or with the Department of Territories regarding the Northern Territory?
In conclusion, I submit to the Minister that to my way of thinking it is essential that her Department keeps up with the times and makes advances against strata titles so that people will be able to use the smaller units and flats that strata titles make available. It is a great waste when ageing people go into premises where the accommodation is too great or the allotment is too big. I think that the Minister would do a great service to housing in Aus tralia if she explored possible means of using the strata title system of land title registration.
Senator Dame ANNABELLE RANKIN (Queensland - Minister for Housing) [10.23] - I was very interested in the points that Senator Laught raised because they are very much on the ball, if I may use that expression. Senator Laught asked some questions about strata titles. First of all, we accept strata titles for war service homes. Of course, strata titles are subject to State legislation. At present the States in which strata titles operate are New South Wales, Victoria, Queensland and Tasmania. I think I am correct in saying that in South Australia and “Western Australia legislation on this subject is awaiting proclamation. I am sorry that I cannot give the honourable senators any information about the Northern Territory. I understand that legislation dealing with strata titles in the Australian Capital Territory is being considered. My own Department has been in on the discussions concerning this matter. I cannot give the honourable senator any further details on it.
Senator Laught might be interested in some figures I have in relation to the construction of flats, because I think they show the picture in regard to the point he raised. At the peak rate of commencements in 1 964-65, nearly one in every three dwellings commenced in New South Wales and Victoria was a flat. In 1965-66 flat building decreased in every State except Queensland, but in 1966-67 flat commencements again rose in every State except South Australia and Tasmania. Approximately 33,100 flats were commenced in Australia in 1966-67. They represented 29% of all dwelling commencements - a record both in number and proportion. I think that these figures are rather interesting. Obviously a different approach is being adopted towards flat living in Australia. This is the type of accommodation that many people desire.
Proposed expenditure and proposed provision noted.
Senate adjourned at 10.27 p.m.
Cite as: Australia, Senate, Debates, 28 September 1967, viewed 22 October 2017, <http://historichansard.net/senate/1967/19670928_senate_26_s35/>.