Senate
12 September 1968
26th Parliament · 2nd Session
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The PRESIDENT (Senator the Mon. Sir Alister McMullin) took the chair at 1 1 a.m., and read prayers.
Flit AIRCRAFT
Senator MURPHY- I ask the Leader of the Government whether the Government now will present to the Senate a statement on the Fill aircraft dealing with delays in delivery, the faults, the increases in cost and the usefulness of the aircraft.
Senator ANDERSON - I am not in a position to make a statement in the categorical terms of the request made by the Leader of the Opposition. With great respect, Mr President, 1 would direct your attention to the fact that there is a notice of motion on the notice paper in the name of Senator Murphy calling for the tabling of papers in this place, lt is a matter of judgment, I would think, between us as to the extent to which questions such as this transgress standing order 99. I do not want to be difficult about it but I do direct your attention to that situation.
As to the question of making a statement in terms of the honourable senator’s request, I point out that in another place the Leader of the Opposition has requested the tabling of the agreement and of other papers which would give certain information. In a statement that 1 heard a few moments ago the Prime Minister indicated that the Government is not prepared to table the particular documents which give details of the performance of the aircraft and other matters confidential to the two governments concerning, for example, the contract made between the United States Government and the manufacturers of the aircraft. He has made it perfectly clear that the AttorneyGeneral is considering other aspects of the papers lo decide whether they should be tabled. Having said that, Mr President, I again point out that the Government is considering the whole matter and I do not propose to go any further. 1 would need to rely upon your judgment in relation to standing order 99.
The PRESIDENT- lt would appear to me to be quite clear that questions relating to this aspect of the Fill aircraft are covered by the motion on the notice paper, if the matter is pursued I will have to rule in that way.
Senator Murphy - Do 1 understand, Mr President, that you are suggesting that because there is on the notice paper of the Senate a notice of motion relating to the tabling of certain documents dealing with financial arrangements, you would therefore rule out the presentation of a statement to the Senate dealing with increases in the cost of the aircraft, delays in the delivery of ‘the aircraft, faults in the aircraft and the usefulness of the aircraft? I ask on what possible basis such a ruling could be given. Is it not apparent that the tabling of documents dealing with commercial arrangements is one procedural step against which the examination of a statement which the Government is being asked to bring down may be made?
The PRESIDENT- 1 think the matter is quite clear. It is laid down in the Standing Orders that questions shall not anticipate discussion upon an order of the day or upon any other matter appearing in the notice paper. The item on the notice paper clearly sets out what is required. If questions are asked outside of that requirement it is a different matter. I think that these questions have to be dealt with as they come along, but I certainly will not allow a question that conflicts with a standing order.
Senator Murphy - Do I understand you to be saying. Mr President, that you would prevent the Government introducing a statement in ‘the Senate setting out the details which I have asked of the Leader of the Government?
The PRESIDENT- No, I have not said that.
page 587
QUESTION
SHIPPING
Senator YOUNG:
SOUTH AUSTRALIA
– I desire to ask a question of the Minister representing the Minister for Shipping and Transport. In this morning’s ‘Australian’ I read with concern that the joint service of Australian and Japanese shipping lines, namely the Australian National Line and the K Line, is likely to be delayed owing to the K Line being refused permission to build its ship. Can the Minister say what effect this will have on the operation of the ANL’s roll-on roll-off service between Australia and Japan? In i he same report il was stated that there was opposition to the joint operations of the ANL and the K Line. I ask: Is this the result of the monopolistic tendencies of Overseas Containers Limited, which is a large British-European consortium, and the three main Japanese lines that intend to operate a service of ships of 1 ,000-container capacity between Australia and Japan?
Senator SCOTT:
Minister for Customs and Excise · WESTERN AUSTRALIA · LP
– I noticed with concern the report in this morning’s ‘Australian’ that the ANL and K Line may have to delay the service of containerised shipping between Australia and Japan because of the difficulty of the K. Line in getting a ship built before the end of next year. I understand the ANL ship will be available about the middle of next year and that it will not wait for the K Line ship to be built bin will commence operations on its own. J am concerned that certain pressures are being brought to bear to delay the construction of the K Line vessel. I will bring this matter to the notice of the Minister for Shipping and Transport and I will ask for a detailed reply ro be given to the honourable senator.
page 588
QUESTION
EDUCATION
Senator FITZGERALD:
NEW SOUTH WALES
– My question is directed to the Minister representing the Minister for Education and Science. It follows upon a question I asked several weeks ago. I again ask: In view of the desperate position of private schools, as has been demonstrated recently by official approaches to the Government, has the Government any intention of providing additional funds to the States for both private and government schools?
Senator WRIGHT:
Minister for Works · TASMANIA · LP
– The honourable senator is well aware that the Government’s proposed expenditure on education is now before the Parliament. That is the extent of any assistance intended by the Government al the present time.
Fill AIRCRAFT
Senator WEBSTER:
VICTORIA
– My question is directed to the Leader of the Government in the Senate. Is the Leader of the Government able to confirm or deny whether a further Fill aircraft crashed this morning off the coast of America?
Senator ANDERSON:
Minister for Supply · NEW SOUTH WALES · LP
– At this point of time I have heard only unconfirmed reports of a possible crash of another Fill Navy type aircraft.
Senator Keeffe:
– lt is not the one we bought, is it?
Senator ANDERSON:
– This is far too serious a matter to be flippant about. The fact is that there is an unconfirmed report of a possible crash off California of a Navy type FI 1 1 aircraft.
page 588
QUESTION
SHEEP
Senator WILKINSON:
WESTERN AUSTRALIA
– Has the Minister representing the Minister for Primary Industry given consideration to providing immediate assistance to those small sheep farmers in the south-west of Western Australia whose livelihood is threatened by the extraordinarily low prices being offered for sheep and fat Lambs in addition to the serious decline in wool prices?
Senator McKELLAR:
Minister for Repatriation · NEW SOUTH WALES · CP
– A lot of us are fully conversant with, the financial difficulties of people in the category mentioned by Senator Wilkinson. To the best of my knowledge, no application has been made to the Minister for Primary Industry for assistance along the lines indicated by the honourable senator. I do not know what can be done in these circumstances. These people are faced not only with low prices for their wool but, as the honourable senator said with low prices for the lambs thai they have been raising. If there is anything that the honourable senator feels that I can do in the way of transmitting a request to the Minister for Primary Industry, I shall be very happy to do it.
page 588
QUESTION
ELECTORAL
Senator MARRIOTT:
TASMANIA
– I address a question to the Minister representing the Minister for the Interior. In view of reports that several State governments are proposing lo legislate to lower the voting age to 1 8 years, will the Minister suggest to his colleague, the Minister for the Interior, that in order to avoid the considerable confusion that would be caused were varying age groupsto be entitled to vote at Federal and State elections, early action should be taken to decide on a nationwide basis if and when any change in the voting age is to be enacted? Would the Minister be aware of the immense administrative difficulties that would arise in Tasmania, where Federal and State electoral boundaries and electoral roils are the same for both Federal and State elections?
Senator SCOTT:
LP
– This is a very interesting question. The matter was raised at the recent Premiers’ Conference with a view to achieving uniformity of voting ages throughout the Commonwealth in order to reduce the percentage of informal voting. The matter has been referred to the attorneysgeneral who are to report back to their respective governments. I understand that our Minister is now awaiting a reply. I agree entirely with the honourable senator that as Tasmania has the same boundaries for both Federal and State rolls it would create complications if uniformity cannot be achieved.
Fill AIRCRAFT
Senator COHEN:
VICTORIA
– Will the Minister representing the Minister for Defence inform the Senate what countries, if any, other than Australia, have agreements for the purchase of Fill aircraft?
Senator ANDERSON:
LP
– I have not that in forma tion but I shall seek it and make it available to the honourable senator.
page 589
QUESTION
CREDIT UNIONS
Senator GEORGES:
QUEENSLAND
– 1 address a question to the Leader of the Government. In view of the Prime Minister’s strong support of credit unions, will the Government now recognise credit unions under the Homes Savings Grant Act?
Senator ANDERSON:
LP
– This is a matter in which I have quite some interest, but it is not within my portfolio; it comes under the portfolio of the Minister for Housing. I recall that during the last sessional period the proposition was advanced during the course of one debate that credit unions should be recognised under certain conditions. But the question really should, be directed to the Minister, for Housing. I might add that at one stage 1 was a director of a credit union arid I have a very warm affection and regard for credit unions. I think, they do magnificent work. But the critical question was whether they came into the category of a certain type of legislation. I think it would be more appropriate for the honourable senator to put his question on the notice paper now. If that is done I will direct it to the Minister for Housing.
page 589
QUESTION
QUALIFICATIONS OF MIGRANTS
Senator LILLICO:
TASMANIA
– Does the Minister representing the Attorney-General know whether any approach has been made to the States with a view to bringing about some uniformity in the recognition of the degrees or qualifications of migrants? If that has not been done, will it be done? In the event of non-recognition of degrees or qualifications by all the States, can representations be made with a view to enabling migrants to sit for examinations without, at least in the case of one State, having to wait until they are naturalised?
Senator WRIGHT:
LP
– I understand the honourable senator’s question to have relation to degrees giving professional status. I also understand from representations that he has made to me and other Ministers that he has particularly in mind the dentistry profession. That is an illustration. The. States prescribe the laws under which admission is given to the various professions - medicine, dentistry, law, optometry and so on. lt is impossible to achieve uniformity. Each State has its own policy. With regard to any preclusion by any particular State legislation of a migrant from sitting for an examination before he completes the period of 5 years for naturalisation purposes, I would have thought that, on being brought to attention by an individual representation to the State concerned, that could be adjusted. In order to assist the honourable senator in this regard, I will make representations to the Attorney-General of Tasmania to see whether, in respect of the dental profession, an applicant for examination as a mechanical assistant or dental mechanic can be admitted without waiting for the period for naturalisation purposes.
page 589
QUESTION
PARLIAMENTARY DRAFTSMEN
Senator COHEN:
– I direct a question to the Minister representing the AttorneyGeneral. I refer to a report which appeared in the ‘Australian Financial Review* of Tuesday 10th September and in which the chief parliamentary draftsman, Mr John Ewens, was reported as having told the Public Accounts Committee that a substantial backlog of work in the drafting section of the Attorney-General’s Department had pushed the Department, as he put it, into hiring staff yielding only 25% to 30% efficiency. Mr Ewens is reported as having given before the Committee evidence critical of the standard of efficiency of junior legal officers of the Department, of the instructions received from other Commonwealth client departments and also of the drafting work of private practitioners to whom work is let out by the Department. I ask the Minister: Does not the serious nature of the criticism made by Mr Ewens warrant the holding of a departmental inquiry into the deficiencies alleged? Can the Minister say to what extent urgent parliamentary matters, such as overdue amendments to the Commonwealth Employees Compensation Act and the Superannuation Act, are being held up by the shortage of staff in the parliamentary drafting section?
Senator WRIGHT:
LP
– The question certainly has a fairly packed content. I do not consider that the criticism warrants the holding of a departmental inquiry. I say that for this reason: The Attorney-General has had this matter under his special consideration ever since my colleague Senator Laught poignantly raised it for our consideration about 3 months ago.. The Attorney-General, with his Department, has been considering a proper system of recruiting, usage of draftsmen and training. To that end the chief parliamentary draftsman is about to undertake a visit to other countries to examine the methods that they employ to solve this problem. For those reasons I think the matter is under competent control and a solution is in sight. 1 am not dismayed when I hear people criticise the work of parliamentary draftsmen, whether they be juniors, private practitioners or the most experienced. I attribute to Mr Ewens, from the point of view of his criticism, a very high level of standards-, but I have not appeared in a legal action involving a statute where some professional gentleman has not indulged in adverse reflection on the type of draftsmanship of the statute to be- interpreted. It is usually a preliminary exercise to the intellectual solution of the meaning of the statute.
page 590
QUESTION
UREA
Senator PROWSE:
WESTERN AUSTRALIA
– I ask the Minister for Customs and Excise: What was the landed cost of urea prior to the recent increase of $14 per ton? What, if any, has been the increase in landed cost? If the increase in landed cost does not account for the rise in price what are the other factors involved?
Senator SCOTT:
LP
– Yesterday I answered quite a number of questions on the price of urea. I concluded by saying that since the beginning of this year the cost to the producer had risen from $53 per ton to $67 per ton, an increase of $14. 1 am not able at the moment to supply information as to the landed cost. I understand from the officers of my Department that the landed cost of urea to the importing companies has increased quite considerably. This has been passed on to the users. There is some thought in the minds of honourable senators who are displaying so .much interest in this matter, because it affects farmers considerably, that the Government may have reduced the subsidy on imported urea. The. facts are that there is a subsidy of $80 per ton of contained nitrogen, which works out at about $36 per ton of bulk urea. There has been no reduction in that subsidy. One Australian company, Nobel (A/asia) Pty Ltd in New South Wales, a subsidiary of Imperial Chemical Industries of Australia and New Zealand Ltd, is manufacturing urea. That company receives a bounty of $16 per ton.
Yesterday Senator Sim asked whether growers were paying any duty on the importation of urea. My answer was that growers were not charged duty on the importation of urea. I want to make it quite clear that urea is imported under bylaw at the present time. It is imported free from countries to which preferential rates of duly apply, and there is. a 1% duty on imports- from countries to which the general rate, applies. I only want to add that the Government and my Department are watching very closely the landed cost of urea with a view to ensuring that the whole amount of the subsidy of $80 per ton of contained nitrogen is passed on to the users.
page 591
QUESTION
PARLIAMENTARY DRAFTSMEN
Senator MURPHY:
NEW SOUTH WALES
– My question, which I direct to the Minister representing the Attorney-General, is supplementary to the question asked by Senator Cohen. Is it not a fact that adjustments of pay of members of the armed Services have been delayed in some cases for 2 years because of a breakdown in the Attorney-General’s Department in the framing of regulations? Is it not a fact that on many occasions in the Senate over a period of at least 3 or 4 years that breakdown as been adverted to? Has it not. been pointed out both inside and outside this Parliament that the breakdown in the Department is impairing the legislative programme of this Parliament? Is not this a matter for which the AttorneyGeneral must bear ministerial responsibility? ls the Minister serious when he suggests that the Attorney-General has had the matter under his special consideration for 3 months?
Senator WRIGHT:
LP
– As the last question asked by the honourable gentleman is impertinent, I will ignore it. When the Leader of the Opposition asks me whether I am serious, I think he needs to be rebuked. As to his other questions, nobody here today has suggested that we are other than concerned at the delays which take place in drafting. That is why over the last 3 months the Attorney-General has made it his special, duty to examine the matter and to evolve a process whereby the recruitment, training and use of draftsmen shall be expanded and improved, and the delays reduced.
page 591
QUESTION
SHIPPING
Senator BISHOP:
SOUTH AUSTRALIA
– My question, which 1 direct to the Minister representing the Minister for Shipping and Transport, refers to the question asked by Senator Young about delays in building ships for the Australian National Line and the K Line. In view of the pressures referred to, will the Minister reconsider the offer made by the Broken Hill Pty Co. Ltd to improve and increase its capacity at its Whyalla shipyards with the aid of financial assistance from the Commonwealth Government, which so far has been refused? Will the honourable gentleman ask his colleague to have the matter reconsidered so that the capacity of
Australian shipyards can be increased to obviate the need to have these ships built overseas?
Senator SCOTT:
LP
– The Government is very conscious of the need to have the maximum number of ships built in Australia. I think most of our shipyards are over-committed at the moment. That is one reason why we have gone outside Australia to have this particular type of ship built. That is my impression of the situation referred to by the honourable senator. However, as his question is important, I will certainly take it to the Minister and obtain a detailed answer for him.
page 591
QUESTION
CIVIL AVIATION
Senator KENNELLY:
VICTORIA
– I ask the Minister representing the Minister for Civil Aviation: As the Estimates are about to be considered in the Senate, can the Minister inform us of when we are likely to receive the latest annual reports of the Department of Civil Aviation and Trans Australia Airlines?
Senator SCOTT:
NEW SOUTH WALES · CP; NCP from May 1975
– Realising the honourable senator’s interest in this matter and that it is important for honourable senators to have the latest annual reports of the Department of Civil Aviation and TAA made available to them, I will take this matter up with the Minister concerned to see whether the reports can be made available before the debate on the Estimates’ begins.
page 591
QUESTION
MEMORIAL TO MR HAROLD HOLT
Senator RAE:
TASMANIA
– My question is directed to the Minister representing the Prime Minister. By way of brief preface 1 remind the Minister that as yet no national memorial to the late Prime Minister, Mr Harold Holt,, has. been created in Australia and. further, 1 refer to the late Prime Minister’s outstanding success in his work in the international field, which success so lifted Australia’s standing among the other nations of the world. .Remembering also that he was a Victorian and that in Victoria there is now being completed a vast new international airport al Tullamarine, will the Prime Minister consider taking steps to have the airport named Melbourne (Harold Holt) Airport to commemorate his name and work.
Senator ANDERSON:
LP
– The question of recognition of the work of the late Prime Minister has had active consideration by the Government and I believe that an announcement will be made soon. My own view of the matter is that the monuments to a Prime Minister of Australia are established in his record of achievements throughout the Commonwealth. It is true that the late Prime Minister was a Victorian and represented a Victorian constituency, but I believe that if there is to be some physical memorial to him the proper and natural place for it to be established is Canberra, which is the seat of government and the place where he had the great honour and distinction to serve Australia as its Prime Minister. However, 1 shall refer’ the honourable senator’s question to the Prime Minister.
page 592
QUESTION
EDUCATION
Senator ORMONDE:
NEW SOUTH WALES
– In directing my question to the Minister representing the Minister for Education and Science I refer to the coming conference of State and Federal authorities on education, which has just been announced by the Minister. Is there any significance in the announcement, in association with the announcement of the conference, that, the problems of private and non-state schools are also to be examined?
Senator WRIGHT:
LP
– I should think that the significance of that statement can be deduced quite clearly from the simple terms in which it was made.
page 592
QUESTION
DEVALUATION
Senator WEBSTER:
– My question is addressed to the Minister representing the Treasurer. I refer to the British devaluation of sterling and the decision of the Australian Government not to follow the British decision, thus increasing the value of the Australian $1. Does the Government consider that the difficulties found by Austral ian. export industries at present in making overseas sales of Australian production are due in the main to its non-devaluation decision? Can the Minister point to any substantial Government - statement which will give added confidence to export industries that the Government considers the compen sation which is payable to those industries due to non-devaluation a continuing and long term obligation of this Government?
Senator ANDERSON:
LP
– Quite obviously that question would have to go on the notice paper as it would require much consideration. Indeed, it canvasses all the arguments that were considered when the Government took its decision in reflation to devaluation. If the honourable senator puts the question on the notice paper I hope to be able to obtain a reply for him in due course.
page 592
QUESTION
NORFOLK ISLAND
Senator KEEFFE:
– My question is directed to the Leader of the Government in the Senate. One of the persons allegedly associated with wholesale company promotion based on Norfolk Island is Henry George Pearce. Is he the same Henry George Pearce who was elected as the Liberal1 Party member for the Federal division of Capricornia in Queensland in 1949 and who was defeated by an Australian Labor Party candidate in 1961? If the answer is in the affirmative, is that the reason why the Government has failed to act on the tax dodging activities of most of the companies registered in Norfolk Island?
Senator ANDERSON:
LP
– I do not know the answer to the honourable senator’s question but .1 deprecate, and every other senator will deprecate, the inference against a man by the name of Henry George Pearce. I do not think the forms of the Senate should be used in such a way.
page 592
QUESTION
CHOWILLA DAM
Senator YOUNG:
– I direct a question to the Minister representing the Minister for National Development. In the current investigations being undertaken regarding Dartmouth on the Mitta Mitta as an alternative site to Chowilla, can the Minister say whether at the same time investigations are being made of the volume of water flowing out to sea from the River Murray? Are calculations being made as to the total amount of water that will go to sea during the- current winter? Is investiga-don being made of the quality of water flowing to’ waste at the present time, taking into account that much of it comes from the Darling and Mumimbidgee Rivers, which could only be conserved by a dam al Chowilla?
Senator SCOTT:
LP
– The Department of National Development, on instructions from its Minister and at the request of the River Murray Commission, is making a survey of the proposed dam sites at Dartmouth on the Mitta Mitta and Chowilla. All factors will bc la ken into consideration, including the How of water into the Dartmouth area. The delay has occurred at the request of the River Murray Commission, which has as its head as Chairman the Minister for National Development, and which has three State representatives. The Commission is anxious to get for South Australia the greatest quantity of the purest water that the State can get at a reasonable cost.
page 593
QUESTION
PARLIAMENTARY DRAFTSMEN
Senator DEVITT:
TASMANIA
– I direct to the Minister representing the Attornery-General a question which is consequential upon the questions asked by Senator Cohen and Senator Murphy, ls the Minister completely satisfied that all the steps which could have been taken have in fact been taken to fill the vacancies for draftsmen on the establishment of the Parliamentary Draftsman’s section of the Attorney-General’s Department? ls he not. aware that vacancies existed for up to 6 months without any obvious action being taken to fill them, a fact to which attention was drawn by questions asked on a number of occasions in this chamber?
Senator WRIGHT:
LP
– As I feel that the situation may be that the honourable senator asks his question with the advantage of information from the Public Accounts Committee which I have not, I ask him to put the question on the notice paper.
page 593
QUESTION
COPPER
Senator RAE:
– Will the Minister representing the Minister for External Territories advise the Senate whether the Bougainville copper project is proceeding and, if so, what stage has been reached and what benefits may be expected to accrue to the Territory of Papua and New Guinea from the successful continuation of the project?
Senator WRIGHT:
LP
– 1 made reference to this project in the speech which I delivered to the Senate on behalf of Mr Barnes on Tuesday of this week. The situation is that this company has indicated that it will make its decision in the middle of next year as to whether it will proceed with the project. Already 230 million tons of ore have been proved and the decision to proceed will involve a capital expenditure of $250m. lt is obvious that the establishment of that industry will be of great benefit to the Territory. The Senate will be interested to be reminded that in the agreement that was made with the company it was provided that if the company proceeds, the Territory Administration will have the right to share 20% of the equity capital, so the prospects for taxation and for the employment of indigenes that hinge upon this undertaking are good.
page 593
QUESTION
SALES TAX
Senator GEORGES:
– My question is directed to the Minister representing the Treasurer. Are children’s school pads and stationery liable to 15% sales tax? If so, can this tax be justified by the Government in view of the Government’s professed advocacy of Commonwealth assistance to education?
Senator ANDERSON:
LP
– First of all, I would need to obtain information as to the implication of the sales tax in relation to the items the honourable senator has mentioned. When I have obtained that information I will be able to answer the substantive question. In those circumstances J think we should send it to the Treasurer for reply.
page 593
QUESTION
HANSARD
The PRESIDENT:
– Yesterday Senator Cavanagh asked me the following question:
My question is directed to you, Mr President. Will you make arrangements to extend to senators who retire and qualify for a life pass, or the senators who retire with a lesser period of service, the privilege of having posted regularly io them copies of Mansard without the necessity for them to be placed on a member’s mailing list so that they may receive this publication which is of great interest to them?
I inform the honourable senator that it is’ already the practice to place on the official mailing list the names of former senators who wish to receive copies of Hansard. If application’ is made to the Principal Parliamentary Reporter the issues will be posted to ex-senators.
page 594
QUESTION
COMMONWEALTH BANKING CORPORATION
(Question No. 359)
Senator MULVIHILL:
NEW SOUTH WALES
asked the Minister representing the Treasurer, upon notice:
What was the cost of Commonwealth Bank advertisements in the ‘Century’ newspaper for the last 3 years?
Senator ANDERSON:
LP
– The Treasurer has supplied the following answer:
The placement of advertising by the Commonwealth Banking Coropration is an administrative matter which, under the Commonwealth Banks Act, is entirely one for determination by the Corporation. Information about expenditure in the various advertising media is not published by the Bank. However, I have been informed by the Managing Director that only occasional advertisements have been placed in ‘Century”.
page 594
QUESTION
AVIATION
(Question No. 378)
Senator O’BYRNE:
TASMANIA
asked the Minister representing the Minister for Civil Aviation, upon notice:
- Has the long established practice going back to Ivan Holyman to run a small readily accessible air charter service between Flinders Island and the mainland of Australia been, or is it now to be, discontinued under the Department of Civil Aviation regulation 197 (2)?
- In view of the isolation of Flinders Island in the middle of Bass Strait and the strong requests of residents and business people, both at Flinders Island and Launceston, to retain this facility, will the Minister take steps to amend the regulation so as to exclude Flinders Island from its provisions?
Senator SCOTT:
LP
– The Minister has replied as follows:
- There is no intention to preclude under Air Navigation regulation 197 (2) the operation of genuine charter flights to Flinders Island provided it is established they are in the public interest and do not erode the legitimate traffic of any airline services to the island.
- This regulation is designed to protect the traffic rights of airlines licensed to operate over particular routes and which are obliged to operate their services according to approved schedules irrespective of the traffic offering. As a consequence, the interests of the residents of centres included in these services are safeguarded. In the circumstances, and in view of the method of applying the regulation as mentioned in1 above, it is considered that it would not be advantageous to the residents of Flinders Island to exclude the routes to that island from the provisions of the regulation. ‘
page 594
QUESTION
TARIFFS
(Question No. 382)
Senator BULL:
NEW SOUTH WALES
asked the Minister repre senting the Treasurer, upon notice:
- Does the present level of tariffs in Australia enable Australia to maintain a low price for overseas currencies, relative to the current levels of wages and prices, with the result that at this rate of exchange the prices received by Australian exporters are artificially low in relation to the internal cost structure?
- If all protective tariffs were reduced by an average of, say. fifteen percentage points, would there have to be a substantial increase in the Australian price of foreign currency to prevent a collapse in wages, unless subsidies were substantially increased?
Senator ANDERSON:
LP
– The Treasurer has supplied the following answer: 1 and 2. The Articles of the International Monetary Fund contemplate changes in exchange rates only to correct a fundamental disequilibrium in the overall balance of payments of the Country concerned. The Australian balance of payments is not in fundamental disequilibrium and, by this test, it cannot be said that the present rate of exchange for Australian currency is ‘artificial’. As for a reduction of, say, fifteen percentage points in all Australian protective tariffs, any attempt to assess the longer term effects and the implications for the exchange rate could only be largely speculative. At least in the short run, some increase in imports at the expense of Australian production could result. Precisely what adjustments of various kinds would be necessary to restore equilibrium it is impossible to say.
page 594
QUESTION
TELEVISION
(Question No. 388)
Senator McCLELLAND:
NEW SOUTH WALES
asked the Minis ter representing the Postmaster-General, upon notice:
- Did the Australian Broadcasting Control Board, in August 1966. issue a requirement to all metropolitan commercial television stations that as from 3rd July 1967 they should telecast not less than 2 hours of Australian dramatic programmes between 7 p.m. and 9.30 p.m. during every 28 days statistical period?
- Have all commercial television networks, other than the Ansett network, completely complied with this provision?
- ’ Has the Australian Broadcasting Control Board given any special dispensation to the Channel 0-10 network? If so, why?
- In order to encourage all commercial television networks to continue televising high quality Australian dramatic productions, according to the times stipulated by the Board, will the PostmasterGeneral ensure that henceforth the Board’s requirements of August 1966 are adhered to?
Senator Dame ANNABELLE RANKIN:
– The Postmaster-General has supplied the following answer:
- Yes; this was one of several requirements for Australian content in programmes. 2, 3 and 4. The more recently established metropolitan commercial television stations namely TEN Sydney, ATV Melbourne, TVQ Brisbane and SAS Adelaide, have experienced some difficulty in meeting the requirement of the Australian Broadcasting Control Board that not less than 2 hours of Australian drama programmes should be presented between 7.00 p.m. and 9.30 p.m. during every 28 days statistical period. Following special representations by these stations,’ which put. forward in detail the financial problems facing the stations, the Board early this year, decided to waive the drama requirement for them until August/September 1968, when the matter would be reviewed. The review is now being made.
The requirements provided that the Hoard may vary any of them if circumstances arise which would prevent a station’s adequate compliance wilh them under reasonable conditions. The remaining metropolitan commercial stations arc complying with the Board’s requirements regarding Australian programmes. I should add that station SAS Adelaide has nevertheless met the requirement for the televising of drama and that station ATV has advised firm proposals to mee! the drama requirement from mid-September.
page 595
QUESTION
PROPOSED COMMONWEALTH WORKS
(Question No. 323)
Senator BISHOP:
asked the Minister for Works upon notice:
Having regard to the scaling down of Commonwealth works in South Australia, in recent years, and the Minister’s own observations made in Adelaide in March, when he was reported as having said that ‘the relative -proportion of Commonwealth works built in Adelaide has not been encouraging.’ will the Minister investigate the possibility of the early commencement nf planned or approved works in South Australia, including the proposed new Adelaide telephone exchange in Waymouth Street?
Senator WRIGHT:
LP
– The answer to the honourable senator’s question is as follows:
H is advised that the following works have been approved for commencement of construction in South Australia during 1968-69 and that the dates shown are the target dates for the invitation of tenders.
The Waymouth Street Telephone Exchange project estimated at $6M. has been approved by the Government and has been reported on by the Parliamentary Standing Committee on Public Works. The tenders will be called about July, 1969. The construction is a 14-storey telephone exchange. Other major projects are under consideration by the Government.
page 595
QUESTION
COMMONWEALTH EMPLOYEES’ COMPENSATION ACT
(Question No. 466)
Senator DITTMER:
QUEENSLAND
asked the Minister representing the Treasurer, upon notice:
Does the Treasurer intend to introduce a Bill governing compensation for Commonwealth employees before the Parliament goes into recess this year? If so, when? If not, why not?
Senator ANDERSON:
LP
– The Treasurer has supplied the following answers:
A short Bill to increase the weekly rates of compensation payable under the Commonwealth Employees’ Compensation Act was introduced in the Mouse of Representatives on 1 1th September 1968. In introducing this Bill the Minister Assisting the Treasurer indicated that work is proceeding as quickly as possible with the drafting of the very much more extensive legislation to which reference was made in the Governor-General’s speech at the opening of Parliament, and this legislation will be introduced as soon as it is ready. It cannot be indicated at this stage whether this Bill will be introduced this session.
page 596
QUESTION
PEACE TALKS IN PARIS
Senator ANDERSON:
LP
– On the 11th September, Senator Ormonde asked me the following question:
Is the peace conference between representatives of the United States and North Viet Nam still continuing in Paris? Is the Australian representative still present at those talks or has he returned to Australia?
The Minister for External Affairs has provided the following answer:
The official conversations between United States and North Vietnamese representatives in Paris are continuing, with regular weekly sessions. Mr H. D. Anderson, a senior member of the Department of External Affairs and former Australian Ambassador in Saigon, remains in Paris, and he is maintaining contact with the United States representatives at the talks there.
page 596
QUESTION
POSTAL DEPARTMENT
Senator ANDERSON:
LP
– On the 2 1st August 1968, Senator Ormonde’ asked me the following question:
Can the Minister representing the PostmasterGeneral give the Senate a progressive report on the Postmaster-General’s Department’s policy of progressively closing down post offices on Saturdays?
The Postmaster-General has now furnished me with the following information in reply:
Although it is the Government’s policy to maintain postal services on Saturday, it has been found practicable to close 126 post offices on that day because they transacted little business on Saturday and are either reasonably close to post offices which are open, or are situated in areas where business houses close. The incidence of public usage has enabled another 79 post offices to be closed at 10.30 a.m. on Saturday and 94 at11 a.m.
page 596
QUESTION
AUSTRALIAN CONSULTANTS
Is it a fact that at present officers of the Department of Trade and Industry are abroad in South-East Asian countries endeavouring to promote the interests and the work of Australian based consultants in engineering and architecture?
Is the Minister aware that the British Government gives compensation through subsidies and in other ways to British firms which gain work in overseas countries?
Does the Minister find that his officers are having great difficulty in selling the services of Australian consultants, whose earnings could be regarded as ‘export’ income for Australia, because of the fact that work in Australia is given to overseas consultants who may have world wide reputation?
The Minister for Trade and Industry has provided the following reply:
Australian Government Trade Commissioners, stationed overseas, do endeavour to promote the use of Australian professional consultants services such as engineering, architecture, town planning, surveying, quantity surveying, management, etc. A Consultants Survey Mission sponsored by the Department of Trade and Industry visited SouthEast Asia and the Middle East in 1967 and suggested that opportunities were available in these areas for Australian consultants.
Yes.I am informed that the Board of Trade in Britain makes an annual grant-in-aid of £Stg1 00,000 to the British Consultants Bureau to assist British consultants to obtain feasibility surveys.
The role of the Trade Commissioner and the Department of Trade and Industry is to assist and facilitate the sales of services by consultants overseas., Australian professional consultants are highly regarded for their skill and the. quality of the work they have performed. However, they are sometimes at a disadvantage because, in general, they do not have the experience of their larger and longer established international competitors. Therefore, any experience that Australian consultants can gain in the successful performance of important commissions in Australia may contribute to securing contracts overseas.
page 596
QUESTION
GENERAL BUSINESS
The PRESIDENT:
– I will now proceed to the discovery of formal business. Is General Business, Notice of Motion No. 8. in the name of Senator Murphy, formal or not formal?
Senator Murphy:
– It is not formal. I ask for leave to make a statement concerning that notice of motion and the discussion of General Business next Tuesday.
The PRESIDENT:
– There being no objection, leave is granted.
Senator MURPHY:
New South WalesLeader of the Opposition
– In response to requests by honourable senators that they be advised of the matters that the Opposition will seek to bring on under General Business on Tuesday evenings, I wish to inform you, Mr President, and honourable senators that it will be my intention to take steps to bring on for debate and decision General Business, Notice of Motion No. 8, which reads:
That there be laid on the Table of the Senate all documents (or copies thereof) which constituted the original arrangements made by the Australian Government for the purchase of F111 aircraft and all subsequent variations in the arrangements.
Senator Wright:
– Is that on Tuesday next?
Senator MURPHY:
– Yes.
page 597
QUESTION
BUDGET 1968-69
Debate resumed from 1 1 September (vide page 577), on motion by Senator Anderson:
That the Senate take note of the following papers:
Civil Works Programme 1968-69
Commonwealth Payments to or for the States, 1968-69
Estimates of Receipts and Summary of Estimated Expenditure, for year ending 30 June 1969
Expenditure -
Particulars of Proposed Expenditure for the service of the year ending 30 June 1969
Particulars of Proposed Provision for Certain Expenditure in respect of the year ending 30 June 1969
Government Securities on Issue at 30 June 1968
Commonwealth Income Tax Statistics, for income year 1965-66
National Income and Expenditure 1967-68
Upon which Senator Murphy had moved by way of amendment:
At end of motion add - but the Senate is of opinion that the Budget is inadequate in that it does not make provision -
to lighten taxes and health costs for families and to increase benefits;
to plan defence procurement and expenditure;
to meet the problems of Australia’s capital and provincial cities; and
to retain control and promote development of Australia’s mineral, fuel, land and marine resources’.
Senator COTTON:
New South Wales
– When this debate was interrupted last nightI was talking about the amount of complex and detailed material that comes before us in connection with the Budget and the Budget debate.I wish to refer to some of the documents that we receive. First of all, we receive the Budget speech itself, with the attached statements, which are extremely important. That applies particularly to Statement No.1 . The statements cover 55 pages and call for a considerable amount of study. We receive a document headed ‘Commonwealth Payments to or for the States’. That is a very involved, complex and detailed paper. We receive the annual report of the National Debt Commission. On an earlier occasion Senator McKenna, a former Leader of the Opposition, made a notable speech on the National Debt Commission and its relationship with the Australian economy, particularly Commonwealth and State financial relations.
We receive the accounts of the Australian Government presented in national accounting form, which is a standard business bookkeeping type of approach that allows one to make a slightly better judgment on the net position from year to year, as distinct from the impact of monetary policy. We receive a paper headed ‘National Income and Expenditure’, which deals with the growth of the gross national product. On page 5 of the document presented this year there is reference to the general Australian growth rate both in terms of prices as they are and in terms of adjusted constant prices. We receive the Commonwealth income tax statistical bulletin. We receive the annual statement on government securities on issue at 30 June both in Australia and overseas. We receive a full statement on the Civil Works Programme for the year, which details what is involved in the whole capital works programme of Australia. We receive a document headed ‘Estimates of Receipts and Summary of Estimated Expenditure’, which allows us to make some judgments on the Budget as between the various departments.
We receive what I call ‘Document A’, which we will begin to debate probably today or next week. It contains the estimates of a revenue nature for each of the departments. We receive a similar paper, which
I call ‘Document B’ and which contains the estimates of expenditure of a capital nature for each of the departments. The last two documents are the ones with which we mainly concom ourselves in the Estimates debate, which ranges over 2 or 3 weeks. Nonetheless, all the other documents to which 1 have referred have a bearing on what we have to consider both in the Budget debate and in the Estimates debate.
Each quarter we receive a Treasury White Paper which is a rundown on how the economy is behaving, whether it is in accordance wilh predictions and whether things are out of balance. We aha receive a summary of the Australian Economy, which is a review of the financial year to the end of June. We also receive from Treasury an Information Bulletin, which gives more information for those who can find the time to devote to the study of these papers. What I am saying to honourable senators is that it is rather a massive amount of material to be ingested in the lime one has available at Budget time. I suggest that there would be merit if a system were devised whereby alt members of the Senate and the House of Representatives were presented with a summary of all these papers which said something along these lines: All the papers are incorporated from A through to C. Then a brief summary of the contents of the papers could follow.
A perusal of alf the materia! indicates quite clearly that wc are living in a fairly interesting financial time. Wc have a lot of forces at. play in the market. We have the forces of Government spending within the governmental or public sector and the factors of enterprise and farming - the private area of expenditure. These necessarily are not always in perfect balance. We have Hie support for the Austraiian economy from overseas investors who provide money by way of capital inflow. At all limes we have this rather difficult management problem and the obvious need for a balanced, critical but reasonable approach, to the genuine difficulties of working a mixed economy which is always in a state of fairly delicate balance. We are always trying to maintain three things at any given point of time - growth, full employment and price stability. These are difficult areas to manage together, particularly in a mixed economy, particularly in a federal system and particularly where a country depends on a large level of investment from overseas for the support of ils growth.
Over the last 5 or 6 years, because of the circulation by the Treasury of so much more material and because of the issuing of its- quarterly White Papers, there has developed in the community a much greater understanding of what is happening in economic and monetary policy. Added to the collection of documents issued by the Treasury is the very useful1 annual report of the Reserve Bank. Therefore I believe that within the terms of the Australian economy and its management there is much less mystique than there used to be. There is much less mystique about Treasury behaviour. This development is in a good direction. I am quite delighted to see this development. I believe that what Australia needs and what we all need is a greater understanding and a greater degree of community comment and informed discussion about economic management and the management of the monetary system. One could present a very sound case for a permanent Senate Ways and Means Committee, as the Senate in the United Slates of America has, to undertake continuously the problem of review and understanding of the economic and monetary policies. Although the phrase ‘ways and moans” is allembracing. it simply connotes the issues with which we are all confronted. What do we want to do. when do wc want to do it and from where do the resources come? So ‘ways and means’ is not a bad expression to use in relation to the general monetary problem.
I think one could look at the present Budget and say that a discussion on the present Budget could very usefully begin with the comments which appear at the end of the speech delivered by the Treasurer (Mr McMahon). I will try to summarise his words in order to try to save time because I must confess that I have an immense amount of material that 1 would like to place before the Senate; not in order to take up the time of honourable senators but rather in the hope that it would provide a body of information that would enable us to understand in detail all the complexities of the Budget. The Treasurer has said that the effects of the Budget, combined with the other influences at work, will be likely to maintain the economic growth in conditions of internal and external stability. There we have the same argument - growth plus stability. He mentioned that there were influences within the Australian economy which were operating very strongly to raise expenditure. The point of view of the Treasury and the Treasurer - and this 1 think will be demonstrated later - is that in all our interests it is not wise to let the economy run ahead loo strongly and become overheated. The general proposition at which we arc looking is sustained growth with stability. Everything we want to do Bows from that.
The Treasurer also mentioned that humane and social values have a priority in the Budget. No doubt other honourable senators will quarrel with the level of social welfare incorporated in the Budget, but that is their proper function. The general approach lo this year’s budgetary problem was to try to give the humanitarian side of our affairs the priority. The object of the Budget, was to do the greatest good for the greatest number of Australians. A couple of years ago the budgetary problem was different in that the tendency was to have a lack of confidence in what we call the private sector. The necessity was to have increased government expenditure in the public sector in order to generate a higher level of confidence, to maintain full employment and to keep the economy moving. This was done. Governmental sector expenditure then began lo assume a very large proportion of total expenditure and this allowed the private sector to generate confidence. Part of the budgetary strategy over the last years has been to maintain confidence, growth and a reasonable rate of progress by utilising government expenditure in the first stage and progressively reducing this as a percentage of the economy as the private sector gained its own momentum.
If we take our minds back we recall that part of the problem of the tendency of the private sector to be a little slack was to be found in recurrent droughts: One of the great economic romances of Australian economic management, in the lime that 1 have been able to observe, has been the ability of the economy to take in its step a major drought and come through without a major economic disaster. This is one of the things (hat make one hopeful that some of the lessons of economic manage ment are now beginning to bc learnt. We are able to iron out the slumps and booms that were characteristic of the economies of countries prior to the Second World War. I think at one stage the governmental sector expenditure was of the order of 16%. Progressively it has been reduced to the current expectation of something like 8%.
There is one cardinal fact of our budgetary experience that we need to bear in mind. lt is that last year we had an excess overall spending in the community as against our overall production. Our expenditure rates were rising at the rate of about 8% per annum. Our income earning capacity, expressed in terms of gross national product advance, was running at about 6%. Irrespective of whether it is my house or your house, my farm or your farm, my firm or your firm or that of someone else, the county is the aggregation of all the people and activity in it and all the forces at play, if the country as such is spending at a faster rate than it is earning - and this indeed is what it had been doing - the situation will lead to a gradual economic imbalance which will have its effect in inflation and will give rise to problems. The argument can be advanced - although people do not like such arguments to be advanced - that economic policy and monetary policy are beginning to move into the area of almost a bi-partisan approach, that we ought really to be able to discuss the problems as such and arrive at an agreed solution which is for the national good. The problem is lending itself less and less to cha( kind of philosophical divergence in argument. The problem of economic management is increasingly the problem of what is the best thing for the Australian people. 1 believe the combined talents of members of Parliament, expressed together, is required to make the best overall judgment.
Looking at this year’s Budget one can make two comments. The first is: Where does the money go? I will try to summarise these figures as quickly as 1 can, but I do need to express them. Defence takes about 19% of Budget expenditure. This year there is an increase in total Budget expenditure of 7.8% over last year. The States are taking nearly one-third; welfare and repatriation about 23%; servicing debts and running departments about 7%; overseas aid. including aid to New Guinea, about 2%; payments to industry about 3%; miscellaneous about 4%; and capital of various kinds, about 8% within the spending programme. As about one-third of the total outgoing of the Commonwealth Budget is to the States, I do not think anyone would quarrel with the proposition that somehow or other we must learn to manage in a better fashion the economy of a federal system, between the Stales and the Commonwealth.
Senator Gair:
– The money comes from the States.
Senator COTTON:
-I suggest that it comes from the Australian people. I have explained where the money goes. Where does the money come from? I said earlier that expenditure in this Budget will increase by about 7.8% over last year. Income is expected to grow by about 10.5%.I refer to my previous point that when you have overspent, at some period you should be prepared to save a little. This is to some extent a Budget which plans to take in more than it gives out. The income side of the Budget shows that about 89% of revenue comes from taxation. Of that amount about 40% is from individuals; about 13% from companies and held-back dividend tax; about 29% indirect taxation; about 7% pay-roll tax and gift duty; and the balance includes sinking fund and trust funds. Here lie the beginnings of some complexities which I referred to earlier in trying to understand this problem, which I have not found to be easy. I have a table of comparison of Australia’s taxation rates prepared for me by the Commonwealth Parliamentary Library Research Service. With the concurrence of honourable senators I incorporate it in Hansard.
The table sets out figures for 1964, the latest year for which it is possible to make valid comparisons, not because our own figures are out of date but because we have not yet received figures for later years from some of the countries with which comparisons are made. The figures for 1964 allow a reasonable comparison to be made. Although the information set out in the table is valuable, I suggest that more information is required for this type of comparison. The subject should be canvassed in more detail, not today but in due course.
I think we need to have an appropriate occasion for a genuine discussion on the methods of raising direct and indirect taxation.
I have had another table taken out for me by the Library Service. It shows the taxation paid by public authorities in Australia. lt sets out the indirect and direct areas and covers the period from 1958-59 to 1967-68. With the concurrence of honourable senators I incorporate that table in Hansard.
Victoria -- I rise to support the amendment proposed by **Senator Murphy.** Before getting onto the' main items of my speech 1 wish to refer to the fact that we have had so many maiden speeches in this debate. Although one may agree with some and disagree with others, the debating ability shown by the new senators is very high indeed. It is a matter of reflection that although 1 have been in the chamber for less than 2 years I am now the fourteenth junior senator, so we have had a turnover of 14 senators in less than 2 years - 4 because of their unfortunate demise and 10 because of retirement. The turnover of senators over a period is far higher than one would imagine and this is not a decrepit old club for retired businessmen and trade union officials, as alleged by quite a number of people who have never seen us in operation. Honourable senators on this side quite rightly criticise his Budget strongly because it is inadequate in many facets. The inadequacies apply to pensions of all descriptions. lt increases indirect taxes on the smaller people and imposes charges on people who can afford it least. The increases in television and radio licence fees should never have been imposed. Honourable senators on this side have dealt very adequately with all1 of these points and I propose to raise a matter that 1 consider to be of extreme importance. 1 believe that we in Australia are in grave danger of losing many of the civil liberties that we have enjoyed for more than 100 . years. I refer particularly to the move in Victoria to introduce legislation that purports to protect citizens of Australia in respect of bugging and eavesdropping. I raise the matter in this speech because there is a direct relationship between this legislation and legislation that may subsequently come before this Parliament. Press reports have indicated that legislation is to be introduced in Victoria on the basis of discussions that took place amongst Attorneys-General throughout the Commonwealth and that the views of the Victorian Attorney-General most closely coincide with those of the Commonwealth Attorney-General. One imagines that this could well bc a pilot Bill for uniform legislation in relation to the alleged protection of citizens against the use of bugging and eavesdropping equipment. The way that eavesdropping and bugging have developed in- America today is absolutely frightening. So much concern has been shown in the United States about lt that a number of books have been written on the subject, some of them very large books. One -was written by Vance Packard and there have been several others. One from which I should like to quote briefly is an authoritative book written by a member of the American Senate, **Senator Edward** V. Long: lt is tilled 'The Intruders' and has the sub-title "The Invasion of Privacy by Government and Industry'. I believe that every honourable senator should read the book because it relates some of the frightening implications of government and private interference with the privacy of individual citizens. If I were game I would ask for leave to have the book incorporated in .Hansard, but if my request were granted no-one would be able to carry the Hansard issue. However, I say most sincerely that every honourable senator should obtain this book from the Library and read it closely. Vice-President Hubert H. Humphrey, in a foreword to the book, said: > We act differently if we believe we are being observed. If we can never be sure . whether or not we are being watched and listened to, all our actions will be altered and our very character will change. > >The questions raised in this book we find will determine whether Americans in the last part of the twentieth century will be free or craven, independent or guarded. The Vice-President has come to those conclusions after sitting on Senate investigation committees in America and hearing evidence that ran into reams of transcript in relation to the invasion of the privacy of people. 1 will be very brief in my quotations from the book and will seek only to indicate the frightening devices that are now available in America and the fact that the production of these devices is a million dollar industry. Dealing with the Federal Bureau of Investigation **Senator Long** said: ft was learned in the Kansas City hearings of the Senate Subcommittee on Administrative Practice and Procedure that the FBI had taken a composition plate which is a standard part of the telephone apparatus and had built an apparently identical part containing a tiny microphone. {: type="A" start="I"} 0. point out that this could be put on anyone's telephone, lt operates not only when a person is conducting a telephone conversation; it is in fact a direct communication link to persons listening outside to any conversation taking place in the room. The senator continued: >The great majority of eavesdropping, however, is nol done with such custom-built devices but with equipment of standard manufacture, or with home-made tools of a standard nature. Today this Ls a multi-million dollar business. One New York firm specialising in over-the-counter snooping equipment announced, in the fall of 1965 the opening of its fifth retail outlet, and it also promised that it would soon be opening ten more stores. That means that this one retailer will have 15 stores in a multi-million dollar business in America selling these devices to the ordinary citizen. {: .speaker-KAS} ##### Senator Webster: -- Do any other devices come tinder the heading of snooping? Do they come as listening devices? {: .speaker-K1F} ##### Senator POYSER: -- They also have closed circuit television which cannot be seen by the persons being observed, lt is being used in industry and is placed even in staff toilets. That is the extent of spying which covers not only sight but also hearing devices. Sitting suspended from 12.45 to 2.15 p.m. {: .speaker-K1F} ##### Senator POYSER: -- Prior to the suspension of the sitting I was describing the electronic devices being used Ibr bugging and eavesdropping. 1 wish to refer to two other sophisticated instruments before proceeding to discuss another matter. The book written by **Senator Long** of America refers to wire tapping and the methods adopted in the past by wire tappers to overhear the conversations of private individuals. **Senator Long** says: >Originally, the wire tapper used only wires. Then a conductive paint was developed. This paint came in all colours and will carry current just as wire does. By the application of a strip of paint an undetectable circuit can bc run along a wall. The sophistication in the method of eavesdropping on individuals and organisations has reached the stage where 1 think it should be completely outlawed by every responsible government. The last reference that I want to make in regard to listening devices is to a bug known as the 'body bug', which was perfected by West German scientists. It is a transmitter so small that it can be coated like a pill and slipped into a person's food, lt then emits a blip. When a person swallows such a device he becomes a walking beacon and can be easily followed. No longer has Schmidt der Spy to wear a long black coat and black hat and duck in and out of the doorways. He can spy in comfort. {: .speaker-KSN} ##### Senator Marriott: -- If a person is doing nothing wrong does it matter if he is being followed? {: .speaker-K1F} ##### Senator POYSER: -- lt may matter. A person may be going to a very responsible trade union conference or to a directors conference. The position in America today is that if any organisation is holding a conference at which matters of importance are to be discussed, such as a directors meeting or a trade union meeting, as a matter of practice de-bugging experts are brought in to go over the conference room with a fine tooth comb to make absolutely certain that that room is not bugged by persons who may desire to listen in to what may be going on. Evidence of the use of listening devices given before a Senate committee in the United States has been documented by persons such as Vance Packard. The situation in America is becoming extremely serious. Despite the fact that the American Constitution contains a Bill of Rights which, on the surface, protects the citizens from this type of thing, the citizens are having extreme difficulty in establishing their rights. In Australia we have no Bill of Human Rights within the Constitution. This has been mentioned by people on this side of the chamber on many occasions. I think that the time has come when the privacy of the citizens of this nation should be safeguarded in legislation passed by Parliament. I think it is extremely important that this protection be given because, as I remarked earler, although the proposed Victorian legislation purports to be for the protection of the citizen, in reality exemptions will be so wide that almost anybody will be able to use these devices if he can establish that it is in the public interest. I will develop my argument a little further. One exemption included in the proposed Victorian legislation is to a member of the police force using the device in the performance of his duty and authorised by the Chief Commissioner, the Deputy Commissioner or an officer of or above the rank of Inspector who has been appointed asa delegate by the Commissioner. This in effect means that bugging devices can be available to every policeman in the State of Victoria because every inspector has the right to authorise any constable on the beat to use them. There is no need for reference to the Attorney-General as there is under Commonwealth law in relation to telephone tapping. It also means that licensing police will be able to invade the privacy of the individual if an inspector gives the necessary authorisation to a constable. In my view such authority should not be given to any Tom. Dick or Harry who has reached the rank of inspector in any police force in the Commonwealth. The second exemption is for customs officers authorised by the Victorian Collector of Customs - not by the Commonwealth Minister for Customs and Excise but by the Collector of Customs in that State. When I read this in the Press I asked the Minister for Customs and Excise **(Senator Scott)** whether he in fact gave authority to the collectors of customs in the various States of the Commonwealth. He denied that such authority had been given. The Minister promised that I would receive a more detailed reply at a later date, but I have not received it so far. The important question raised in my mind at this time is thai the proposed Victorian . legislation includes exemptions for officers of Commonwealth departments. J cannot envisage this type of provision being included in State legislation unless the Commonwealth Attorney-General or some other Minister has been consulted and has given his imprimatur. Another dangerous aspect of the State legislation is that it could well be the pilot legislation for the other States and for the Commonwealth. Exemptions wil'l also be granted to persons coming under the control and direction of the Federal Attorney-General where the security of the Commonwealth is concerned. Wc know that this operates at the present time in relation to telephone tapping. We have been told in this chamber on many occasions that the only person who can give authority for telephone tapping is the Attorney-General. If wide exemptions are given in relation to other devices 1 have no doubt that there wilt be a marked extension of telephone tapping. Indeed, I firmly believe that. the honourable member for Yarra **(Dr J. F. Cairns)** in another place was quite truthful when he stated that his conversation with another person had been tapped during a period when the other person was seeking release from the Army as a conscientious objector. I accept the statement made by the Attorney-General **(Mr Bowen)** that he was not associated with such a practice. But 1 believe that certain persons associated with another Ministry used a device similar to those 1 have described for the purpose of obtaining the information that was obviously obtained. What perturbs me most of al'l is the final exemption listed in the proposed Victorian legislation. Ft refers to a person obtaining a warrant from a magistrate after a full disclosure of the reasons and circumstances under which the device is required. Thus, a private individual will be given the right to invade the privacy of other citizens if he can establish before a stipendary magistrate that this is in the public interest. 1 can imagine alf kinds of situations where such information would be valuable to other people and they could claim it to be in the public interest. T could envisage a situation in which a union is in dispute with an employer. There the employer could probably make a case before a stipendiary magistrate to establish that it was in the public interest to have known to him the decisions or intentions of that union. I can see it at Australian Council of Trade Union level and I can see it at many other levels such as where company mergers may be involved. It is all very well to say that no stipendiary magistrate would give this kind of permission in such circumstances, but when you legislate in the terms in which, this legislation will come before the parliaments of the States of the Commonwealth you are legislating for a very long time indeed. If these privileges are abused in any one of the States the process of having appropriate amendments put through the several parliaments would be almost impossible lo accomplish, lt is hard enough now to get the six States to agree to complementary legislation on any particular matter without having this type of legislation imposed and then having second thoughts about it afterwards. So far as the Commonwealth is concerned, I think we should have legislation that will protect the citizens of the nation in relation to the use of these types of instruments, but I think that the legislation should be designed to ban firstly their importation, into this country and secondly their manufacture. This is the only real way in which the safety of the citizen will be preserved, lt is true that certain instruments, because of their size and their nature, could be smuggled into this country, but we have lo make every endeavour to protect the interests of the people and to avoid a situation such as obtains in the United States of America. I have mentioned on previous occasions that in America no citizen is safe from the intervention of persons who want to obtain information by the use of such devices. Even some of the court decisions in America have made it clear that the legislation operating in some of the States there at the present time, and at the federal level, is not sufficient to stop a person from bugging a private citizen unless entry into that citizen's abode can be proved. In fact, physical entry into the abode is no longer necessary with many of the devices that I have described. I therefore hope that a second look will be taken by the Attorneys-General at this question in their conference which is to be held very shortly in Perth. It has been suggested in one Press report that the views of the Commonwealth Attorney-General and those of the AttorneyGeneral for the State of Victoria are the mildest views so far expressed in connection with this matter. If the other States implement legislation which is worse than this, then the country will be facing a very serious position indeed. As this is one of the matters to be discussed at the conference of Attorneys-General in Perth, I do hope that they will examine it far more closely than they have apparently done so far. Another matter that I wanted to raise during this debate is that of aged persons who are inmates of old peoples homes and infirmaries. I believe that while the Government is giving assistance in many ways through its aged persons homes grants and subsidies to organisations that are prepared to build infirmaries associated with the flatettes that they build under the scheme, we have now to take a further step by way of direct assistance to the various organisations who provide homes for the aged. In the city of Geelong we have Grace McKellar House, which is completely an infirmary at the present time although the original intention at the time it was built was that it should be a joint old peoples home and infirmary. Its development, however, has been stagnated to such an extent that it is still an infirmary and only the most urgent cases can be admitted. In Geelong we have only 183 beds to cater for a population of 110,000 people. The surrounding districts extending out to Colac and other areas within a 50-mile radius of the city of Geelong also utilise the facilities of the Grace McKellar Home. I think we can take it, therefore, that it is catering for something near 125,000 or 130,000 people and it has only 183 beds available at the moment to look after those of that number who are infirm. The city of Castlemaine in Victoria, which has a population of 7,000 inhabitants, has a 344-bed hospital for the aged. Bendigo, with a population of 42,000, has a 407-bed hospital for the aged. Ballarat, with population of 56,000, has a bed capacity of 746. So we find that the biggest city in the State of Victoria outside the metropolitan area of Melbourne has the lowest number of beds for the infirm people of its area. There are now 185 urgent cases requiring admittance into the Grace McKellar Home. These are urgent cases and, at the present rate of expansion possible with the moneys available from the State for that work, these people cannot hope to be admitted for another 10 years. That is a very long time for 183 persons to have to wait. During that time, a continuing number will be added to the waiting list. The total number on the waiting list of that home is over 700 aged persons. Over 700 are awaiting admission, and we have only 183 beds. Some honourable senators, quite naturally, will say this is a State matter because the State provides the finance for these homes. Up to a point, this is a valid argument, but the position I want to put to the Minister is that under the aged persons homes grants legislation there is provision for payment of a subsidy at the rate of $2 for $1 to those organisations which have built flatettes when they build infirmaries associated with the flatettes. Organisations such as the Brotherhood of St Lawrence or the Returned Servicemen's League, which have completed sixty of these flatettes could, if they had the finance, claim a subsidy at the rate of $2 for $1 for the extension of their operations to infirmaries for these people, and 30 beds will be provided under the subsidy scheme for every 60 flatettes constructed. In Geelong, two organisations have built quite a number of fiats and have received money under the aged persons homes grants legislation. One is the Percy Baxter group and the other is the RSL village in the city of Geelong. This is on land that was originally donated for an old peoples home in that city by two very good people, the Misses McKellar. They made available free to the citizens of Geelong 30 acres of land for the purpose of establishing a hospital for old people. I am suggesting to the Minister that it might be possible to look at the subsidies on a regional basis. Although both the Percy Baxter and the RSL village groups of homes are sufficient in number to claim the subsidy, it is generally accepted and anticipated that at no stage will they claim this subsidy for the purpose of providing infirmary beds. I am suggesting that in those circumstances the subsidy that could be granted to those people could well be granted to Grace McKellar House for the purpose of building a ward to cater for the persons who are already occupying the Baxter Homes and the RSL units. Alternatively, the Government should have a serious look at the possibility of providing subsidies to those organisations that have the greatest need and not necessarily on the basis of the number of flatettes that may be built by these very worthwhile organisations. The figures that I quoted earlier show quite clearly that in Victoria the need is greatest in the city of Geelong. I have metropolitan bed figures that I could quote, but I want to confine my remarks to Geelong and its relationship with other towns and areas in the State. If the subsidy is available and has not been used by some people, the Commonwealth could assist us greatly by making a direct grant to Grace McKellar House in the city of Geelong to enable it to carry out the expansion work that is so vitally necessary. At one stage the officers of that home worked out that it would take 72 years to house all the persons on the waiting list, at the present rate of progress on capita] works. It is obvious from the figures that I quoted earlier that the 10-year period means that most of the persons who are now urgently in need of attention in this infirmary will be dead long before there is any opportunity to have them housed and looked after properly. Because of these problems the Geelong Grace McKellar House Committee devised a system of day hospitals. It pioneered the system in Australia. It is now looking after 219 persons at associated day hospitals away from Grace McKellar House. All these persons are taken from their homes in the morning. They are given their 'treatment - therapy, voice training, physiotherapy and all the other types of treatment that are required to keep them on their feet or to try to cure them of their ills. They are given a hot meal in the middle of the day. They then are taken back to their homes between 3 o'clock and 4 o'clock in the afternoon. These establishments are hospitals in every respect except that the old people live in their own homes instead of being taken into Grace McKellar House. An examination has shown that 75% of the aged people who are attending the day hospitals are in need of admission to the home itself. But because of the desperate position there they are treated in this way. One of the tragedies of the position is that because the establishments are day hospitals and have no inmates occupying hospital beds - they constitute an auxiliary service to the Grace McKellar old folks home - no subsidy is received from the Commonwealth in respect of the treatment of these people. I suggest that because of the unusual circumstances associated with this problem in Geelong the Commonwealth consider making direct grants to the persons who are being treated at the day hospitals that have been established in that city. That would not cost the Government a great deal of money. It would not make the Government alter a principle to any degree. The need exists. I ask the Government to consider granting subsidies to homes on a regional basis in association with homes that have been built in the area under the Aged Persons Homes Act, or to examine the matter as a special problem with a view to granting direct subsidies without considering the number of homes that have been built. I believe that this can be done, and done to the betterment of the aged people in the city of Geelong. It would not be a very costly venture to the Commonwealth. I hope that both of the matters I have raised in this speech will receive the close examination of the Parliament and the Ministers who are associated with them. I want to see something done urgently in relation to the encroachment on the privacy of our citizens. I also want to see something done urgently in relation to the problems of the aged sick who are living in the city of Geelong and who are unable to obtain the accommodation that they need so badly. {: #subdebate-30-0-s2 .speaker-KMX} ##### Senator GREENWOOD:
Victoria -- I join with other senators in congratulating those honourable senators who have made their maiden speeches in this debate. I also join in extending to them our best wishes for a period of constructive activity in the Senate. We are considering the Budget papers. The Budget represents the Government's proposals on how it will raise the money that is required to pay for those activities that it considers in the nation's interest. The Budget represents the Government's proposals for the nation's housekeeping and its development. We hear comments expressing either support of or opposition to the Budget. Those are generalities which on examination do not really reflect the attitudes that are adopted. It would be surprising if every person who supported the Government and was a member of the Government parties was to agree in every detail with what is contained in the Government's proposals. It must be recognised that the Government in particular is charged with the responsibility of expressing its ideas on how money should be raised and how it should be expended. It is within those broad limits of acceptance of what the Government proposes that Government senators find themselves supporting the proposals. In this context it is relevent to examine the amendment that has been put forward by the Opposition. I refer honourable senators to what my colleague **Senator Withers** said last night, namely, that the amendment moved by the Opposition represents a negative opposition mentality. It certainly does not propose any alternative in any respect to what the Government has proposed. Having heard a number of Opposition senators speak, one can fairly make the comment that there has been a great deal of inconsistency in proposals; there has been considerable contradiction; and, to use the phrase used by **Senator Withers,** there has been nothing to suggest that Opposition senators have any real intention, hope or belief that they could form an alternative government. I take as an example the first paragraph of **Senator Murphy's** amendment, which states: >The Senate is of opinion that the Budget is inadequate in that it does not make provision - (a) to lighten taxes and health costs for families and to increase benefits; In effect, what he is saying is that revenue should be decreased and expenditure should be increased. In the amendment that he proposed and in his speech there is not one suggestion as to how the benefits that should be increased are to be paid for. There is further imprecision in that there is no suggestion as to what benefits should be increased. Therefore, I think it is fair to say that the attack that is made is in generalities and that its lack of precision is its own condemnation. Paragraph (b) of the amendment says that the Budget is inadequate in that the Government has failed to plan defence procurement and expenditure. Yet an amount of about $ 1,200m is proposed to be spent on defence. There is no suggestion in any way as to how the Government's planning in that respect is defective. Again that is a generality that the Opposition has thrown in in the hope that those words will have an impression on someone who hears them. When the words come to be examined they have no relevant meaning at all. The third point is that the Budget is inadequate because if fails to meet the problems of Australia's capital and provincial cities. In what way does the Opposition say that it fails to meet the problems of Australia's capital and provincial cities? In the first place the amendment ignores the fact that, excluding Canberra, Australia's capital and provincial cities are the concern entirely of State governments. The various State governments have proposals for developing their capital and provincial cities and they make proposals to the Commonwealth Government for financial assistance to enable them to carry out their objectives. Then there is nothing in anything that the Oppositionhas said to indicate that the Government has failed to meet some specific request of the State governments. There is no suggestion of the ways in which the Commonwealth has been lacking in carrying out what is a State function. There is no suggestion of the ways in which the Government has been inadequate in its provision. The final point of the amendment is that the Budget is inadequate because it does not make provision to retain control and promote development of Australia's mineral, fuel, land and marine resources. I suggest that to put forward that proposal is to ignore the facts of Australian development at the present time. It is ludicrous to suggest that there has been no development of Australia's mineral, fuel, land and marine resources over the last 15 to 20 years. There has been development of such a character that no other country can compare with Australia in the way in which resources have been developed. Much of the development is due to the fact that Australia has been a stable country and has been attractive to investors, both domestic and overseas, and that the Government has been willing to promote their interest in Australia in the belief that the development of its resources will lead to the growth of Australia and the betterment of the Australians who live here. One has only to look at some of the figures relating to the growth of the Australian mineral production from 1950 to 1966 to realise the tremendous development that has occurred. If one takes iron ore as an example one can see that in 1950 production was 2,364,000 tons. In 1966 it had grown to 11,425,000 tons. If one takes silver one can see that from a production of 10 million ounces in 1950 production rose to 18 million ounces in 1966. When one takes the mineral resources in which spectacular development has taken place in recent years one can see a comparable development. The production of manganese rose from 14,000 tons in 1950 to 301,000 tons in 1966; of rutile, from 18,000 tons in 1950 to 244,000 tons in 1966; of zircon, from 21,000 tons in 1950 to 236,000 tons in 1966. In this connection one ought to regard also the discovery and availability of crude petroleum and natural gas. There was none of these in 1950 but now they are available in such proportions that the petroleum resources represent between 10% and 20% of almost immediate self-sufficiency, while in natural gas there is more than sufficient to supply the needs of the metropolis of Melbourne. The Government can justly claim that the policies it has pursued have created the environment in which these discoveries have occurred. One can only suppose from what one hears from the Opposition that it would have followed a different policy. One may reasonably ask whether this development would have occurred if that different policy had been followed. I repeat that the approach of the Opposition to the Budget is attack and criticism in general terms. The Opposition is imprecise in its approach, expresses platitudes and in no sense presents alternatives. It ignores the real prosperity of the country. It expects that overnight one Budget will resolve all problems. No-one ignores the fact that there are unresolved problems and that there are matters in respect of which there could be improvement. But government is the continuing process of meeting and resolving problems. Yet the attack of the Opposition, as I have heard it in the course of the debate, has been to accuse the Government of taking no action to meet these problems and of being culpable because in this one Budget it has not been able to overcome these problems. Of necessity the process is a continuing one. If judgment were to be made on the question of how, over a period, the Government had tackled the problems, I appreciate that there could be material for debate. There certainly is not material for debate on the proposition that one Budget alone is the reason why the problems which the Opposition sees have not been overcome. I suggest that Opposition senators do not give adequate recognition to the fact that the policies have to be worked out in the light of our resources and are to be tried and tested by experience. Members of the Government and members of the Liberal Party of Australia are seeking to establish an Australian society in which those things that form part of our Party policy and Party objectives are achieved. We seek the kind of society in which, to use an expression which gained currency during the last war, there is security from the cradle to the grave, but it must be a security in which we do not lose sight of the fact that we are a society of individuals and that thrift, responsibility, reliance and self-help are qualities which are of the very essence of the individual. What the Government is seeking to establish is that every wage earner is guaranteed employment and to the extent that he is able to earn he is able to provide. I think that the Government's record over the 19 years during which it has been in office demonstrates that full employment has been maintained. No other country can equal our employment figures. We are seeking to develop a country in which the citizen is protected from the disruption, distress and fears caused by a depression when there is neither work nor pay, nor the ability to maintain that self-respect which every individual seeks. We are seeking to establish a community in which the individual can lead a life free from the fear that he may not be able to meet the cost of a particular illness. In these matters the record of the Government stands up to scrutiny and examination. {: .speaker-7V4} ##### Senator Georges: -- But not so far as the pensioners are concerned. {: .speaker-KMX} ##### Senator GREENWOOD: -- The pensioners are looked after in a way, which, having regard to our resources, reflects credit on the Government and the people. {: .speaker-KPG} ##### Senator Keeffe: -- Do you think the pensioners believe that? {: .speaker-KMX} ##### Senator GREENWOOD: -- I do think the pensioners believe that. I know it is all very well to have associations of pensioners - those who are active and those who agitate - and to regard their views as the views of the mass of pensioners. But I do not believe they are the views of the mass. Naturally the pensioners would like as much money as could come to them by way of pension, but they are appreciative because they recognise that there are limits to the Government's resources. The benefits with which pensioners are provided today, particularly the married pensioners, are real benefits to which people can look forward particularly if they have utilised their income while they have been employed and saving in a manner which will enable them to cope adequately with their problems. {: .speaker-KPG} ##### Senator Keeffe: -- Can the honourable senator live on $13 a week? {: .speaker-KMX} ##### Senator GREENWOOD: -- I do not understand the relevance of that question because we are not concerned with what I live on. We are concerned with what the Government can afford to pay to pensioners having regard to their necessities. Providing we can maintain for individuals during their lifetime sufficient incentive and an ability to save, when they reach the stage of receiving pensions they can look forward to a very satisfactory existence because they Wi have the products of their own savings. The amount they can save and keep for themselves under the present legislation *U* very generous. In addition to their pensions they may receive a little other income without affecting their eligibility for pensions. I appreciate that there may be a challenge that more should be provided for pensioners or groups of pensioners, but that is to be determined in the light of the extent of the Government's revenue and of all the other competing expenditure so that the priority of social services can be fixed in relation to other requirements. It can be said 'hat this Budget acknowledges the continuing problem of pension rates which have been signicantly increased. Another principle which the Government Parties are seeking to establish is that the Australian citizen should be able to provide for his children the education and opportunities he would like to provide and of which the children are able to make use. The Commonwealth and States combined are spending a significant part of our total national income in the provision of educational facilities. Admittedly there arcproblems which the Government, as pa/ of a continuing process, must endeavour to resolve. The achievements of this Government are such that today there is virtually no position in the land to which a young person with talent cannot aspire. I can remember - and it is not all that long ago - when that sort of criterion was the basis on which Australia's performance was sought to be assessed. In terms of the continuing policies to which I have referred the record of the Government will stand up to any sort of reasonable examination which can be put up by the Opposition. The Government's proposals as outlined in the Budget speech are made in the context of a stable economy in which there has been and is intended to be a continual growth in the gross national product. The differences which exist between the Government and the Opposition are basically differences as to the way in which the ultimate objectives are to be achieved. I sense that in terms of the ultimate objectives there is not a great deal of difference, if any at all, between members of the Opposition and members of the Government Parties. But there is a very real difference in the approach we would follow to achieve those objectives. The emphasis of the Government, in terms of the economy, is on the dynamic force flowing from an individual being given opportunities for freedom, enterprise, creativeness and initiative that are part of his character, and the ability to retain the rewards which come from exercising that enterprise and initiative. We believe that the maximum freedom consistent with all the other requirements which society commands of a government will promote the greatest development for Australia. In this context the question of overseas investment becomes a matter which ought to be looked at with care, particularly in the light of what it is achieving for Australia. This is a matter to which I wish particularly to direct my remarks. **Senator Murphy,** in the speech in which he proposed his amendment, made a number of comments based upon what I regard as the fallacy that we have lost or have given away, or are losing or are giving away, our mineral resources. That is part of the amendment which he proposes as a means of castigating the Government. He said, amongst other things, that we have no policy for the recovery of ownership and control of our resources and industry, supposing thereby, quite wrongly, that they have been lost. He said that much of our mineral resources is no longer Australian. To the extent that it has been exported he is right, but he was not using the words in that sense. He said that nothing is done to ensure that the tremendous benefits which flow from the utilisation of our great mineral resources become the benefits of the people. He said that there should be a policy of sensible control of overseas investment in Australia. They are emotive words and nothing more than that. They ignore the basic facts. They should be carefully regarded. If the Opposition seeks to put forward a view of the Government's policy for the development of our mineral resources in which it claims that a radical change is required, that is a fact which the people of Australia ought to recognise. If the policy is to be changed, we will stop overnight the development which has characterised Australia over the past 10 to 15 years and we will put nothing in its place. We have generated development, employment and consumer spending. If overnight the foundations of that policy are removed, there will follow the greatest economic crisis that this country has ever experienced. This is implicit in all that the Opposition says, if it means what it says, when it attacks overseas investment in Australia. A consideration of the attack made on overseas investment in Australia shows that it seems to concentrate on two facets, the first of which is the claim that we have lost control in some way of our mineral resources or that we are unable to control investment. The second facet is that in some other way foreign ownership of capital invested in Australia is to be regarded as dangerous to this country. The benefits of a tremendous nature to be gained from the present overseas investment in Australia are ignored. This is well recorded. I refer honourable senators to the report of the Committee of Economic Inquiry appointed by this Government in 1963. The report is known more generally as the Vernon Committee report. At paragraph 11.70 the Committee said: >We have no doubt that overseas investment in Australia has been a powerful force assisting the growth of the economy and that some continuing inflow will be required to maintain future growth at the desired rate. At paragraph 11.74 the Committee said: >Doubts are also sometimes expressed about the effect of overseas investment on the balance of payments. We have a good deal to say about this in both this chapter and chapter IS. It is undeniable that Australia has become dependent to some considerable degree on overseas investment to make good deficits in the current balance of payments, and we can see little prospect that this will be changed, at least for some years. That comment was made before some of the more significant developments which have taken place in Western Australia and Victoria. The report continued: >In our view, the danger is that Australia may be led into reliance on a continued inflow of capital to finance increasing current balanceofpayments deficits. If this happens, the servicing of overseas investment can sooner or later become a severe burden on the balance of payments and the call will be for even more capital inflow to ease the strain. At the same time, the economy will become increasingly vulnerable to sudden changes in the balance of payments, including changes in the level of capital inflow itself. 11.75 However, it would be foolish to blame the overseas investor, if Australia became committed to this course. The reason would be, not that overseas investors were preying on the economy, but that Australia had exported too little, saved too little and imported too much. The solution to the problem lies in Australia's hands. If exports cannot be expended sufficiently to pay for imports and meet other overseas obligations, either the rate of economic growth will be reduced or, if it is maintained with increasing overseas investment behind it, industry will come increasingly under overseas control. All I say, because it bears out what the Vernon Committee of Economic Inquiry said, is that if there is not corresponding to the inflow of private overseas capital a corresponding growth of exports, we will find ourselves with the problem that continually we will be seeking to have capital coming into the country to equalise the balance of payments. But what has happened in Australia, and it has happened significantly in the years since the Vernon Committee brought down its report, has been that the great bulk of overseas investment coming into the country has been expended on those resources in which Australia has a ready exportable market. Accordingly, we have that particular situation in Australia which the economists point to and say is a situation for which we should be striving. In terms of economics the dangers, which are reckoned as being dangers involved in too much capital inflow, are being met because that capital inflow is being applied in those fields where the benefit is really to be derived and the dangers are able to be overcome. It is also significant to refer to an authority which may have some acceptance in the eyes of members of the Opposition because on occasions he has expressed views in which they have found much to approve. I refer to Professor H. W. Arndt who wrote in the 'Economic Record' in 1957 on the subject of overseas borrowing a very illuminating article entitled 'The New Model'. He said at page 255: >There is every reason to believe that profits accruing to overseas investors absorb only part of the benefit which accrues through higher productivity in the enterprises established by overseas capital; that a substantial part accrues to consumers in the form of better quality products (and/or lower prices), to local factors of production in the form of higher real incomes, and to governments in higher tax-revenue. > >As far as the direct costs and benefits of direct investment are concerned, therefore, the issue is not really in doubt: there is almost certainly a net gain to the borrowing country. Professor Arndt then proceeded to deal with what he calls the indirect benefits. He stated: >The indirect benefits mostly fall under the general heading of technical progress. It is a wellknown advantage of direct investment over portfolio investment that it brings to the borrowing country not merely capital but also technical and managerial knowhow. There is no need to dwell on the very great advantages which Australian manufacturing industries have derived in the postwar years from the introduction of overseas, and especially American enterprise, managerial skill, techniques, methods and new products. Through the stimulus and example they give to domestic firms, through training of local labour at all levels in new skills, and through the pressure of powerful competition, the benefits of technological advance spread beyond the firms in which the overseas investment is made; they accrue as external economies to residents of the borrowing country and represent an additional net benefit which, though quite incapable of measurement, may be very substantial. On this aspect I noted some of the interjections which have been coming from **Senator Georges** and, in particular, one relating to the position in Canada. I refer to a statement made by Professor Safarian of the University of Saskatchewan who wrote a book entitled 'Foreign Ownership of Canadian Industry' which was published in 1966. In it he discounted much of the popular view that there is a real problem in respect of foreign investment in Canada. He said: >The benefits from direct investment extend well beyond the supply of capital. The most important benefit is the transfer of knowledge in all its forms, including new products, production skills, marketing methods, management ability, and access to extensive research-development facilities. Market contracts and guarantees may also be important, particularly in the case of the sale abroad of primary products and their manufacture in volume. {: .speaker-7V4} ##### Senator Georges: -- The risk is still great. Man's knowledge is useless if he is unemployed, and that is what happens when much of your industry is controlled by overseas concerns. {: .speaker-KMX} ##### Senator GREENWOOD: -- I fail to see how there is any connection between employment and the mere fact of overseas control, but that leads on to one other aspect of this question of foreign ownership. I have sought, with reasonable diligence, I hope, to ascertain what figures might be available to show the extent or amount of foreign ownership in Australia. This is something which it is not very easy to ascertain. I suggest that **Senator Murphy** also has experienced the same difficulty because one has only to look at the questions on the notice paper of the last few days to see that he is seeking the aid of the Government to obtain information as to the extent of overseas ownership and control of particular industries. {: .speaker-K6F} ##### Senator Cavanagh: -- The Department published it at one time. {: .speaker-KMX} ##### Senator GREENWOOD: -- -I can only say that the fact that **Senator Murphy** has the questions on the notice paper is an indication that he feels that the information is not available and is seeking it. I simply say that it is not very easy to find information on this. {: .speaker-K6F} ##### Senator Cavanagh: -- There could be another purpose. {: .speaker-KMX} ##### Senator GREENWOOD: -- I merely make the comment that despite the fact that in September **Senator Murphy** is seeking this information, nevertheless in August he was prepared to condemn the Budget on the basis of information which he is now seeking to ascertain by questions. Ons may ask the question: If one puts aside, as I think we may, a discussion of our balance of payments situation, what is the intrinsic worth of Australian ownership as distinct from foreign ownership. I would challenge any honourable senator to say that foreign capital is better than Australian capital on any objective consideration. Naturally, all other things being equal, if we were asked: 'Would you prefer an Australian's capital or an American's capital?' we would answer: 'An Australian's capital'. But that is a subjective consideration which defies any rational or logical explanation. Surely it is this sort of emotive consideration which has raised this into an argument of political or ideological importance and which is designed to characterise the difference between the Government's approach and the Opposition's approach. It ought not to be a valid way of determing the matter when we have at issue questions so vital to Australia as its growth and its development. Indeed, one can only suppose, having regard to the amounts which are involved in the type of expenditure which overseas investment permits, that if the Opposition desired to substitute for that overseas investment some domestic investment, assuming it were available, it would be domestic investment by the wealthy and there would be a situation in which the wealthy bore the risks, took all the profits and became richer. That would be the necessary corollary of the Opposition's argument. In other spheres and in other places it is the direct antithesis of what they say. When one looks at the Canadian situation, if I may now turn to it, there are many misconceptions which have been used to bolster arguments in Australia about the position of Canada. In 1962 there was a royal commission in Canada on banking and finance. To that commission the Canadian Metal Mining Association, which would be a body naturally concerned with developing Canadian mining operations and local ownership, had this to say: >Capital requirements for large-scale mining operations are of a magnitude which makes it quite impracticable to rely on Canadian sources alone. The same Royal Commission on Banking and Finance made the following authoritative statement: >Because of this foreign investment, both merchandise exports and gross national, product have grown faster than the servicing of our foreign obligations ... As long as this investment is productive and adds to Canadian income and wealth, it will give rise neither to serious servicing costs in relation to Canadian earnings nor misallocation of resources in the Canadian economy. On the contrary, it will accelerate our development and bring closer the day when this country will become on balance a net exporter of capital to other nations. I think it is of particular relevance here that the report also stated: >We do not look with favour on Canadian legislation which thwarts capital flows for reasons unrelated to our underlying need for them. That essentially is the position that we have at the present time in Australia. We have a need for overseas investment and we ought not to be concerned with restricting that flow for reasons which are unconnected with our need for them. Our basic approach to this - and it has been the basic approach of the Government and the Liberal Party for many years - is that we will encourage capital investment, both domestic and overseas, by the pursuit of stable economic policies and the encouragement of overseas capital to combine with Australian capital in establishing and developing enterprises. We recognise that the growth targets which we have set ourselves and the stability of the economy depend - and will always depend for the foreseeable future - on developments of a character which require the finance and assistance and know-how that come to us from overseas. {: .speaker-7V4} ##### Senator Georges: -- Is this Country Party policy? {: .speaker-KMX} ##### Senator GREENWOOD: -- The Country Party can speak for itself. We have only to look at the growth in our exports of mineral products, along with the growth domestically of mineral production, to recognise the advantages which have been flowing from overseas investment in Australia. In a Government publication called The Australian Economy' which was distributed to ali senators shortly before the Budget speech was delivered, reference is made to the fact that in the last financial year rural exports earned about $150m less than they earned in -the previous year. Of course, there were seasonal factors which contributed to that. But in the same year there was an increase in the value of exports of minerals. Iron and other ores and concentrates, together with coal, chemicals and alumina, added more than $120m to the amount they had earned in the previous year. So we have not only an increase in our private capital inflow from overseas. We have also - what is so vital - an increase in our mineral export production, and the value of that export production has been increasing considerably. In this context I would also illustrate, because one illustration is to hand, the amount of money which is required for the sort of activity which is currently part of Australia's development of mineral natural resources. In the address which was made by the Chairman of the Broken Hill Pty Co. Ltd last Friday, appears this statement: Good progress has continued on the Mount Newman iron ore project. I interpolate to say that this is a project in which BHP has combined with overseas companies: Expenditure on first stage development still looks like being close to the estimate of $188m, of which our share is 30%. The Mount Newman joint venturers have contracts to supply Japanese steel mills with 100 million tons of ore between 1969 and 1984 and also 70 million tons to our company, commencing in 1970. Recently, additional contracts have been negotiated to supply 2.5 million tons of high grade ore and 1 million tons of low grade ore to Japan in 1969 and 1970. A further 5 million tons of low grade ore will be supplied over 10 years commencing 1970-1971. I mention these figures to illustrate not only the type of expenditure which is involved but also the type of benefit which comes from it. If the Opposition wants to put an end to the present policy of overseas investment, this sort of expenditure and this sort of return to the nation will be thrown into jeopardy. It is incumbent upon the Opposition, in the light of the statements that its Leader has been making in this place, to indicate clearly whether in fact it proposes to restrict overseas investment and whether it regards this sort of development as not being in Australia's interest, and what it proposes to put in its place. When one considers the development that has taken place in Victoria as a result of the discoveries of oil and natural gas in Bass Strait, one gets a further appreciation of the type of expenditure which is required and which can come only from overseas. What has happened, of course, is that BHP had combined with Esso and together they are arranging a joint venture in which the expenses and the returns are equally shared. I cite again the address which the Chairman of BHP gave last Friday: Because of the terms of our agreements with Esso, the great bulk of the cost of exploration work has been borne by that company so that our expenditure is a good deal less than one-half of the $7 3m. However, the initial development expenditure of which we pay half will include a further $2 10m, made up of $31m for the Gippsland gas processing plant, and $24m for the Long Island Point fractionation plant, on top of offshore expenditure exceeding $93m and pipelines costing in the order of $62m. In addition to this initial expenditure, it is likely that further investment of the order of $55m will be required to complete the overall plans for the Martin, Barracoota, Halibut and Kingfish field to cater for anticipated production requirements after production commences. What BHP is providing is merely half of the total expenditure which is involved. When we have expenditure of $500m to $600m contemplated by that company in the near future and recognise that the same amount is being spent by other companies, we have some idea of what would have been our inability to develop without overseas capital. It is a shortsighted policy and a purely political stand which would deny to Australians the benefits, short term and long term, which come from overseas investment The suggestion, of course, is that foreign investment involves foreign ownership of shares in Australian companies. Australia's record shows that what starts as investment of overseas capital in Australian enterprises eventually becomes greater Australian participation in those companies. One can take again as an example the Broken Hill Company. When it commenced its steel production in 1911 in the Newcastle area it was a company with a 74% overseas ownership. In 1967-68, overseas ownership represented 16% of its capital. As **Senator Wright** indicates, it is one company in which many Australians have had an opportunity to invest and of which they can be regarded as part owners. Western Mining Corporation Ltd is another company which in recent years has been engaged in great discoveries. After having been started with overseas capital exclusively, 90% of its ownership is now at Australian addresses. Mount Isa Mines Ltd, which paid dividends only after 24 years of difficulty, was initially put on its feet, I think in 1927, by American capital. There was a 5% Australian ownership which has now increased to 35%. I mention, just because the figures are in mind, that Mount Isa Mines Ltd has earned for Australia during the period it has been in production $442m in exports. However the dividends which have been paid overseas have amounted to only $46m. In addition to that, in terms of import replacements presumably, Mount Isa Mines has sold $197m worth of its production on the Australian market. This is the pattern to which a virile Australia can look forward. The amount of money at present invested in enterprises that are essential to Australia is so enormous that either there is not the capital available in this country or there are not the organisations willing to risk money on an enterprise which may give a small or even no return. Accordingly we must depend upon overseas capital. One corollary of this is that we must permit rewards to those who are prepared to invest. If people are prepared to invest in terms of $500m to $ 1,000m it must be assumed that if the investment is not lost - there is always the risk that it may be lost - the reward must be commensurate with the value of discoveries that are made. If one assumes the benefits to Australia's economy in terms of growth, employment, the accretion of technical knowledge and expertise and a growing national product, on balance the value of overseas investment cannot be denied. The Budget is framed to provide for the development of the Australian economy in the coming year at a growth rate which is comparable with the growth rate of other years. If this growth rate is maintained - I think everyone has confidence that it will be maintained having regard to the Government's performance in the past - we can look forward to an increase in the standards which this Government has set itself and to further progress towards the objectives which this Government has had in mind since first it took office. {: #subdebate-30-0-s3 .speaker-K6F} ##### Senator CAVANAGH:
South Australia -- At the outset let me congratulate those honourable senators who have made their maiden speeches during the course of this Budget debate. Being one of the late speakers in the debate I find that so many honourable senators have made a maiden speech that I shall not mention them personally but I will say that they have lived up to the high standard that we have come to expect in maiden speeches. We look forward to the participation of the newly elected senators in the debates that take place in this chamber. Because this Budget is uninspiring it has not given rise to inspiring speeches although they have been of quite a high standard, honourable senators on one side of the chamber condemning the Budget and honourable senators on the other side of the chamber attempting to justify it. I commend **Senator Cotton** in particular on his contribution this morning. He made a most interesting speech which showed that a lot of research and study had gone into its preparation. Although I could not agree with his conclusions I appreciate the amount of work that he put into it and the way in which he used figures that he regarded as acceptable to arrive at the conclusions he wanted to arrive at. **Senator Greenwood,** from whom we always expect a very good and thoughtful contribution, seems to be emulating the Prime Minister **(Mr Gorton)** in his remarks on the Budget. The Prime Minister said: 'We know that welfare benefits are not adequate but what can we do in 6 months? We are reviewing them'. **Senator Greenwood** said: 'What more do you expect in one Budget?' If it can be assumed that that is a sign of things to come, the less fortunate in the community can look forward to a better distribution of the wealth of this land in the future. However, the Liberal-Country Party coalition which has been in office for the past 19 years must be condemned. If we can accept what the Prime Minister and **Senator Greenwood** have said, there is an admission that for 19 years the Government has let Australia down but now it is determined to rectify the position. Let us appreciate that some attempt has been made to make a new start to rectify the failures of the Government over the past years. If that is the true position, we appreciate what the Government intends to do. After all, it has been in office under the new Prime Minister for only 6 months, so after it has had more experience we will look forward to the promise of security from the cradle to the grave, as **Senator Greenwood** mentioned. Many people would not believe that there is any security at present. We have in Australia pockets of poverty with people going to bed every night hungry. Although, as **Senator Greenwood** said, every wage earner is guaranteed employment, the people desire more than employment. They want a proper standard of living, and they would get a proper standard of living were it not for the Government's intervention in court hearings of trade union applications for wage increases. For example, as the honourable senator mentioned, the people want freedom from the fear of illness. That is still a real fear in the minds of breadwinners. What will happen to the family if the breadwinner becomes ill? If there is any need for reform in Australia it is in relation to hospital and medical benefits. {: .speaker-KKP} ##### Senator Gair: -- Do what the Gair government in Queensland did and give them free hospitalisation. {: .speaker-K6F} ##### Senator CAVANAGH: -- At one time we could respect the Gair government but its former members have since changed their attitudes and now do not merit our admiration. Let me refer to education. If one has read the reports of teachers organisations and of State governments and if one has knowledge of the lack of facilities in and the overcrowding of schools, particularly in New South Wales, one must question this Government's education policy and ask whether sufficient is being done in the field of education. **Senator Greenwood** referred to the necessity for overseas investment in Australia, and quoted the Vernon Committee report to show that unless we increase exports to meet our overseas payments we must have foreign investment. The Minister for Trade and Industry **(Mr McEwen)** is one person in authority who is aware of the position. He deprecated the fact that we are selling a portion of the farm each year to meet our overseas commitments. There is nothing wrong with a policy of overseas investment in Australia while overseas investments are being received. But when we no longer have part of the farm left to meet our overseas commitments calamity will hit us. That is when the Government will realise that there are dangers in overseas investments and that it should have taken notice of the Vernon Committee's finding that we should increase our exports to meet our overseas payments. While some overseas companies are reaping the benefit of the mineral wealth of Australia, others are taking control of established industries that do not have an export potential, such as the meat and biscuit industries and other smaller industries. This fact leads me to ask the question: Why is there not greater restriction on any overseas investment in Australia? The Budget provides for a record expenditure of $6,591m this year. This is an increase of 7.8% on last year's expenditure, which was 10.4% greater than that of the year before. We have been told that the major proportion of the increased expenditure - other than the increased defence expenditure - will be spent in Australia and therefore will not affect the balance of payments problem. Obviously, the Treasurer **(Mr McMahon)** understands that a revenue increase of 9% is a problem. He expressed some doubt in his Budget speech by saying that it is risky to count on another record flow of capital from abroad to finance the large overspill of commitments of importance. He said that the Budget will be balanced by, among other things, bank borrowing of $644m. The largest single item of expenditure in this year's Budget is defence. Last year's expenditure on defence totalled $1,1 15m but this year it is estimated to be $l,217m, which is an increase of 9%. In actual figures it is an increase of $102m. But this may not be the sum total for defence expenditure because the Government's military advisers are now engaged upon a most comprehensive review of Australia's strategic situation and prospects. The Treasurer said that the review will assess the basic assumptions which underlie the Government's defence policy and that it is a vital step in formulating the Government's long term defence policies. He went on to say that when this review has been completed a new defence programme will be drawn up to carry the planning of the Government's defence capability forward into the 1970s. It could well be that when the military advisers have completed that review there will be increased expenditure on defence. The total expenditure of $1,2 17m has snowballed from the expenditure 10 years ago. In 1953-54, in the lull following the Korean war, the defence vote was $353. lm. It had inched up to $428.1m by 1962-63 - 9 years later. It topped the $400m mark in only the last 2 years of that period. The take-off came in the following year when expenditure jumped to $529m. This was the first of the 4 years, during which the annual defence vote was to increase by 22%. Last financial year it rose to $l,115m. At this level defence was accounting for about 4.3% of the gross national product. Whilst we may talk of defence expenditure as a proportion of the gross national product, I think we should also look at what it actually means. The Treasurer said that adoption of the social welfare proposals Outlined in the Budget would add substantially to various classes of welfare payments this year. He said that expenditure on social services, repatriation, health and housing benefits taken together was estimated to rise to $ 1,446m or SI lim more than last year's total. Although the combined expenditure on repatriation, health and housing is $200m more than the defence vote, the increase in welfare payments is only on a par this year with the increase in the defence vote. The increased defence vote nearly equals the increased payments to the States. The increase in the defence vote is $102m and -the increase in the payments to the States is $113m. The total contribution to the States is $ 1,466m as against $l,217m for defence. The defence vote has been snowballing so rapidly in recent years that it is equalling the whole social welfare vote and it is equalling the whole vote to the State governments, which are now protesting at the inadequacies of the moneys that they are getting. It may be said that it is the Commonwealth's responsibility to defend Australia. Does anyone feel that we have better defence because of the increased expenditure on defence? Is it thought that we are more secure today because we are spending $102m more on defence this year than we did last year? Is this policy of defence getting us anywhere? I doubt that it is. As was stated in the other place recently, we have no greater security because the cost of the Fill aircraft that are to defend us has risen three times as much as the original cost. There is no greater security in Australia because the price has increased. I interrupt my trend of thought to say that, although I am not one to determine what type of defence equipment we need, I wonder whether, with the knowledge that another Fill aircraft has crashed, man is capable of developing a machine that can carry passengers at a speed two and one half times that of sound without going into outer space. Many accidents have occurred with this aircraft yet we seem to be committed to purchasing 24 of them. It is not fair to ask Australian personnel to man and fly such aircraft until their reliability has been fully demonstrated and a definite flying period established for which they are safe. At the present time, we cannot offer any such protection to those officers who will be required to operate the Fill aircraft. Although, according to the engineers' drawings and scientific theories, these aircraft have certain possibilities, they have not shown in practice that they do in fact have them. Their record of calamities is so great that it is not fair for a nation that is trying to develop its fighting strength to buy planes such as these which actually are still only in the experimental stage. If there is no possibility of our cancelling the contract, then we should not take delivery of the planes until their safety and effectiveness as fighting aircraft are fully established. When we realise that we are spending on the defence of Australia as much as we spent on the whole of our social services we appreciate that we could double pensions, hospital benefits and also repatriation benefits if our defence vote were not necessary. We appreciate also that, if there were no defence vote, we could double our payments to the States. We cannot help but feel, too, that our expenditure on armaments is not giving us the security that we should have if we are to continue to live in peace and security. {: .speaker-KBW} ##### Senator Wright: -- What is the honourable senator's argument as to the defence expenditure? {: .speaker-K6F} ##### Senator CAVANAGH: -- We are not making Australia secure by it. Nor are we providing the protection that is necessary when we base our defence solely on weapons of war. {: .speaker-KBW} ##### Senator Wright: -- But would the honourable senator eliminate the vote, or reduce it? {: .speaker-K6F} ##### Senator CAVANAGH: -- I think we should look to see whether there is some other method than that of posing a threat to anyone seeking to invade Australia. We have fought two world wars. One was a war to end wars. We were successful in that war. The second was a war to make the world safe for democracy. We won that conflict, too. Yet today we find it necessary to devote the biggest part of our budget expenditure to providing further means of defence because of our failure to achieve the very things for which we successfully prosecuted two world conflicts. {: .speaker-KBW} ##### Senator Wright: -- But is not that because of the resurgence of the things against which we fought those two world wars? {: .speaker-K6F} ##### Senator CAVANAGH: -- I am trying to come to that point, if the Minister will only be patient. Is there any other method? At times we have put our faith in the United Nations, a world government, which was established to outlow war and to render aid to anyone who was subjected to an act of aggression. Unless that world government is a powerful force, I fail to see how one small country can defend itself against any one powerful country. We have had the occasion of Russia's marching into Czechoslovakia. We were told that this was an act of aggression. It was the same type of aggression as we saw in Vietnam and because of which America entered into the Vietnam dispute. {: .speaker-K69} ##### Senator Sim: -- Are you saying that is a valid comparison? {: .speaker-K6F} ##### Senator CAVANAGH: -- If the honourable senator will have patience and not try to make my speech, I shall give him all the information he requires. I could never say it was a valid comparison because I deny that there is aggression in Vietnam other than by foreign forces, including American and Australian forces. I am saying that the Government's contention is that we have troops in Vietnam because we have a responsibility in Vietnam to protect an independent country from aggression from the north and to protect its right to determine its own way of life and to establish its own government. The Government says that this justifies the sacrifice of Australian, American and Korean lives. The Government also says that the same kind of thing happened in Czechoslovakia, yet it makes no suggestion about sending troops to Czechoslovakia. Indeed, it even refused to vote on a resolution to apply sactions to Russia over the Czechoslovakian issue. Obviously it would be suicide for Australia to send troops over there. It would certainly be unwise for Australia to impose sanctions on Russia when, over the last 3 years, Aushas entered into trade agreements with all but one of the Warsaw countries which were opposed to Czechoslovakia. To take such action would mean to terminate agreements already made, and trade is of paramount importance in the view of some sections of this Government. I think it would be suicide to send troops to Czechoslovakia, but the Government's attitude towards the Czechoslovakian incident is a clear indication that the Government's view is that we can send troops in those cases where the aggression is by a small nation but that we must refrain from any such action when the alleged aggression is by a large nation. It is clear, therefore, that under present circumstances small countries can rely on no protection in the form of armaments if they are attacked by a powerful force. For that reason, Australia's defence must be based on some method other than the building up of armaments. Because of the lack of assurance that we would be assisted by powerful allies in the event of war overtaking us, I suggest that we should establish an organisation which we can trust. I agree that at present we cannot place great reliance on the United Nations to give us security if we are attacked. The United Nations force is not a strong force. All our efforts should then be concentrated on making it a strong force. It has made a great contribution to peace and to the settlement of conflicts in the world. Its weakness lies in the lack of support given to it by the various governments of the world. We never propose support. Whenever support is required, we deal with the subject as a matter of politics. When the invasion of Czechoslovakia occurred, the first thing that hit us was what political capital could be gained out of the incident. For example, in Hansard of 21st August **Senator Murphy** pointed out that on 29th July he asked that Australia demonstrate publicly our support for the Czechoslovak Government. Then, not to be outdone in gaining political kudos, **Senator Greenwood** attacked the Australian Labor Party and asked the Prime Minister to make a public statement challenging various peace and disarmament organisations to declare where they stand and charged them with inconsistency. Following that, **Senator** Buttfield wanted to publicise something alleging double talk on the part of the Russian people. When the conflict was on the concern was to make political capital and there was a feeling of hatred toward countries with which we disagreed. As I stated in the adjournment debate on 27th August, I supported the motion on the Czechoslovakian situation. Earlier I had asked the Minister representing the Minister for External Affairs to ask his colleague to use the influence of his Department to bring about peace in the troubled Socialist world rather than gloat over the turmoil for political purposes. The reply to my question was not one that could be commended. In order to make the United Nations or some other international force effective, must we not reach the stage where we take a different outlook on the whole question of world defence? We are all talking war. We are all talking defence. Under this Government Australia has a Minister for Air, a Minister for the Navy, a Minister for the Army and a Minister for Defence all building up costly departments to train a force that will be efficient in the methods of killing. There is no talk of having a Minister for peace. No-one is interested in having a Minister for peace. Our purpose seems to be to see whether we can compete with other people with our methods of destruction of human life. When the Minister for External Affairs **(Mr Hasluck)** made his statement on the Czechoslovakian crisis in the Parliament - in that statement he deplored the action of Russia - he stated that the matter was before the United Nations. The United Nations was interested in peace. It was not interested in condemning Russia or someone else, lt took a different attitude, as the statement issued on behalf of the SecretaryGeneral shows. It reads in part: >In the present case, the Secretary-General regards the developments in Czechoslovakia as yet another serious blow to the concepts of international order and morality which form the basis of .the Charter of the United Nations and for which the United Nations has been striving all these years . . . > >He has appealed to the Government of the Union of Soviet Socialist Republics to exercise the utmost restraint in its relations with the Government and people of Czechoslovakia, and strongly hopes that this appeal will be heeded by the Government of the Union of Soviet Socialist Republics and its Warsaw Fact allies. That was the statement of someone who was deeply concerned. It was not an attempt to apportion blame. It was an appeal to Russia and its allies to stop a breach of the United Nations Charter. The fact that the invasion was a breach of the Charter is one reason why it had to be condemned. I believe that this Parliament was justified in its condemnation. If we are to contribute to the peace of the world we must realise that the reasons that made Russia invade Czechoslovakia could reoccur not only in that country but also in other countries. We must remember that Czechoslovakia is a buffer state between two ideologies. Unless we can remove the causes of this invasion we are contributing nothing to the peace of the world. But under this Government Australia will continue to be involved in greater defence expenditure next year and in subsequent years and in assistance to other powers in the hope that we can achieve a mightier nation for the purpose of annihilation. If we are to have international peace, we will have to study the matters that cause conflicts. It is no solution just to condemn Russia without making a study of the reasons that made it take the action that it took. Russia says that a revolutionary section was set to overthrow the Socialist regime of Czechoslovakia for the purpose of making a future attack on the satellites around Russia. {: .speaker-K69} ##### Senator Sim: -- Does the honourable senator believe that? {: .speaker-K6F} ##### Senator CAVANAGH: -- At one time the world condemned Russia for invading Finland. {: .speaker-K69} ##### Senator Sim: -- It should have. {: .speaker-K6F} ##### Senator CAVANAGH: -- My friend says that the world should have condemned Russia. The reason for that invasion was that in Finland there was a Fascist butcher named Mannerheim who had plans to permit German boats to use Finnish ports in order to bombard Leningrad. No-one who studies history today condemns Russia for its invasion of Finland. Although Russia had a military pact with Germany, it invaded half of Poland to create a buffer state between its own borders and a prospective invading army from Germany. Russia lost 19 million people in the last war. Its cities were razed to the ground. Its determination now is that that will not happen again. {: .speaker-KRU} ##### Senator Little: -- Then was it really Russia's fear of Czechoslovakia that caused it to go into that country? {: .speaker-K6F} ##### Senator CAVANAGH: -- It was Russia's fear of forces that would seek its destruction that forced it to take protective action. Whether that fear was real or imaginary, it was a fear that existed in Russia. If history can justify Russia's invasion of Finland and its invasion of half of Poland and if there was a fear that certain people were seeking to set up a Fascist regime in Czechoslovakia, it would be difficult to condemn Russia. The evidence does not support that fear, but it was a real fear in Russia. On 28th February 1967 the present Prime Minister read in this chamber a statement that was made by the Minister for External Affairs. It is reported at page 143 of volume 33 of the Senate Hansard. The Minister for External Affairs made a review of international affairs at that time. Dealing with Russia, he said: >Since my own visit to Moscow in November 1964, when I had the honour to be the first Foreign Minister to be received by the new Prime Minister **Mr Kosygin,** we have looked for opportunities for co-operation. Later, in describing the better spirit of cooperation in Russia, he said: >One can speculate on possible reasons for the change that has been taking place in attitudes of the Soviet Union. > >The former Russian feeling of encirclement has gone, at least as far as Europe is concerned. . . . There was a recognition by our Minister for External Affairs that co-operation was not possible while there was this fear of encirclement. There is still mistrust between the Western powers - the upholders of their decadent system of capitalism against the spread of Socialism - and Russia. Should there be? Can we not reach a recognition that both systems can live together? Can there not be an attempt at such a recognition? When the Czechoslovakian situation arose, unlike U Thant, we did not appeal to the Russians; we immediately condemned the Russian invasion and made use of it at every question time for the purpose of pouring out our hatred. We may not have known the facts. We were relying on Press publicity of the facts, whether we were justified or not. We were prepared to condemn Russia, not because we knew the facts but because we hated it. We condemn Russia but not Rhodesia because of the two opposing views and ideologies which we hold. {: .speaker-KRU} ##### Senator Little: -- The Labor Party did not oppose the sanctions in regard to Rhodesia. It just wanted to have the vote taken. {: .speaker-K6F} ##### Senator CAVANAGH: -- Please keep quiet. Your condemnation of Rhodesia was not sincere and you know that. Your Party's amendment proposing sanctions against Russia was moved for the purpose of justifying the conflict between certain powers and Russia, although the desire of the United Nations was to settle the whole question as amicably as possible. Whatever wrongs Russia may have committed, she has not used napalm and has not bombed cities. The Minister for External Affairs recognises that the fear of encirclement creates a position whereby we cannot get co-operation from Russia. Can we alleviate this fear? The statement by the former Minister for Education and Science continued: >The Australian Government hopes that over a period of time the mainland of China will be accommodated within the international community. But diplomatic recognition of Peking or its admission to the United Nations is not a short cut to that objective. Essential elements in bringing about an accommodation include a continued willingness and capacity by China's neighbours to resist direct or indirect attack. So, according to the Minister, before we can accept China into the United Nations or into the world community we must have the willingness of her neighbours to resist direct or indirect attack. We must control China's neighbours. Russia has said that we will not control her neighbours and use them as future stepping stones. If armaments are not the solution and if we cannot rely on United Nations force, what else is there to hope for? I agree that we cannot rely on the United Nations at the present time, but should not all efforts be made to strengthen that organisation? In the debate on the Rhodesian issue one senator said: >I am shocked and surprised that the Opposition should feel obliged to approve the resolution passed by the United Nations Security Council respecting Rhodesia and the action of the Australian Government in endorsing that resolution. I fully understand that the Government was in a position in which it had to comply with the Charter of the United Nations or decide to leave the > >United Nations. I do not know that we are ready to leave the United Nations although, for my part, I cease to think of it serving a very useful purpose. It has some usefulness but it is also creating a great deal of danger and wrong influence in the world today. This morning's edition of the 'Australian' contains an article which states that at yesterday's Liberal Party meeting the United Nations was attacked. The article stated that 70% of the back benchers of the Liberal Party were opposed to the United Nations. Does this mean that we have destroyed the last hope of an international peacekeeping force? Does it mean further exenditure by Australia on weapons of destruction? Does it mean that those people believe that by leaving the United Nations we will have greater security? If we did that, what would be our future? {: .speaker-KBW} ##### Senator Wright: -- A statement of fact like that, of which the newspaper has no knowledge, usually is garbled. {: .speaker-K6F} ##### Senator CAVANAGH: -- I do not know what authority the paper had for the statement. If one takes into consideration the questions that have been placed on notice, there is an element in the Liberal Party - I do not know its strength - that is opposed to continued membership of the United Nations. I hope that its strength is not 70%. I have read an extract of a speech made by one Liberal Party senator. Do members of the Liberal Party think that we should be opposed to a permanent force for peace and that we should not try to work in conjunction with that force; that we should not try to eliminate the causes of war, whether just or otherwise? Surely we must work for those things. I now wish to deal with some of the domestic matters referred to in the Budget. I have received a telegram from the Reverend Trenorden, President of the Methodist Church in South Australia. It reads: >South Australian Methodists consider pension rises inadequate. Urge appointment of independent body to fix all social service benefits on basis of needs. {: .speaker-KRU} ##### Senator Little: -- That is our policy and has been for years. He must be one of us. {: .speaker-K6F} ##### Senator CAVANAGH: -- The Methodists, from wherever they took the lead, have a policy in which they believe. I am very much concerned about the statement that there should be an independent body to fix social service benefits. I would like to see an inquiry into that matter. Under the Budget the pension for a totally and permanently incapacitated ex-serviceman will rise by *$3* to $33.50. I would like to know on what that figure is based. In the past it had some relevance to the basic wage. It is difficult to ascertain what it is based on today. I believe the pension is granted not only for the purpose of meeting living expenses but also to afford some compensation and recognition of service and of injuries suffered. The Budget speech tells us that the rate of Commonwealth employees compensation for an unmarried adult will rise by $2.70, making a total of $28.15. Why the difference between those two rates? A person who receives compensation also experiences pain and suffering. The TPI pension is provided solely by the Government whereas the compensation may be the responsibility of employers or insurance companies, but where is the difference in principle? **Senator Greenwood** said that people could live on the pension if throughout their employment they had saved. I do not know whether **Senator Greenwood** or other members of the Government parties have tried to save on a low wage, with a number of children in the family, but if they have they will know how much they can save by the time they get to pensionable age if they have a mortgage on the home or have to pay rent. A single pensioner is allowed earnings of $10 a week before his pension is affected. With the $14 pension he is to receive, he may have an income of $24. Why should he receive less at a time when he needs assistance than a recipient of workers compensation? If a pensioner is prepared to contribute by his own efforts to his weekly income, why should he not be allowed to earn an amount sufficient to increase his income to that of a recipient of workers compensation, without affecting his eligibility for a pension? Invalid, age and service pensioners who cannot work at all must exist on their pensions of $14 a week. This is where the pockets of poverty can be found that are now to be tackled, according to the speeches of the Prime Minister and **Senator Greenwood.** It is said that this increase is the forerunner to many more increases. A differentiation is made between single and married pensioners. Married couples are to have their combined pensions increased by $1.50 a week to a total of $25 a week. Two single pensioners will receive a combined weekly total of $3 more than a married pensioner couple. **Senator Little** referred to the inducement for pensioners to live in a state that he termed sin' to gain an extra $3 a week, an amount which may be essential for them to live. A married pensioner couple may earn $17 a week between them without affecting their pensions. Thus they are limited to a combined income of $42 a week, as against a possible combined income of $48 a week of two single pensioners. Government supporters have told us of the high level of employment today, but there will always be a section of the community comprised of people who are unemployable or who are out of work between jobs. Their entitlement is limited to the unemployment benefit of $8.25 a week. No increase in the unemployment benefit has been provided since, I think, 1960. Their entitlement to the unemployment benefit is forfeited if they receive other income of more than $4 a week. If they receive an extra $4 a week they are compelled to live on an income of $12.25 a week. An age pensioner who cannot earn other income receives $14 a week. Is it not clear that an unemployed person who may have more commitments than an age pensioner should receive at least the equivalent of the age pension? Widows without children are to have their pensions increased by 75c to $12.50 a week. A new classification is provided for. I refer to the non-pensioner wife of an age pensioner who is permanently incapacitated, but not permanently and totally incapacitated as an invalid pensioner, or who has a dependent child. This category of pensioner is to receive an increase of $1 a week to $7 a week. Entitlement to that additional Si a week necessitates proof of incapacity of an invalid, or that there is a dependent child. Why it is considered that $7 a week is sufficient for the wife of a pensioner who is permanently incapacitated or has a dependent child, or whose husband is an invalid pensioner, when it is considered that a sum of $14 a week should be paid to an age pensioner to enable that pensioner to live? As I have pointed out, a recipient of workers compensation gets more than an age pensioner. Honourable senators will appreciate that an invalid pensioner has incapacity ranging from 85% to 100%. I turn now to consider the amounts to be paid to war orphans. A war orphan who has lost both parents is to receive an increase of $2 a week to $10.15 a week. This is a recognition by the Government of the expense involved in keeping a child who must go to live with strangers or to an institution. A war orphan who has lost one parent is to receive an increase of Si a week to $5.40 a week. Quite possibly a war orphan has lost his or her father and receives for keep $5.40 a week. A war orphan who has lost both parents is to receive $10.15 a week. It is clear that a surviving parent is expected to pay half the cost of keeping a war orphan. Surely there is no justification for that method of calculation. Honourable senators opposite have said that Labor has no alternative policy. Time will not permit me to explain Labor's policy other than to say that we would increase social service payments. Labor's aim is a more equal distribution of the income of Australia than is effected by the Government. One of the documents accompanying the Budget is a very readable booklet entitled 'Commonwealth Income Tax Statistics'. It sets out the incomes of Australians. At pages 6 and 7 is a table which sets out the numbers of taxpayers in the various income groups and the net tax paid. It shows that in 1965-66 50.83% of Australian taxpayers received 28.09% of the total Australian actual income. It also shows that 73.07% of the total number of Australian taxpayers earned 50.9% of the total Australian actual income. The remaining 26.93% of taxpayers earned the balance of 49.1% of the total actual income. So about half of Australia's actual income is shared between about 73% and the other half is shared between 27% of the total number of taxpayers. This illustrates the difference between Labor's policy and the new look policy of the Government in commencing to develop the welfare state. At pages 4 and 5 of the booklet a table shows that in 1965-66 only sixty people in Australia had an annual income of more than $100,000. They shared between them a total income of about $9.3 million, so that each member of that group on an average had an annual income of about $155,000. It is true that between them they paid income tax of $4,942,000, or an average of $82,366 each. They were each left with an average of $72,634 a year to struggle along with. If that sum is divided by the amount of the age pension - $14 a week - it is clear that each individual in that top income bracket had a weekly income equal to that of 100 age pensioners. These sixty taxpayers have an income equivalent to the total amount received by 6,000 pensioners. Is there any justice in this? But, of course, the higher the income the greater the deductions that can be claimed. Among the sixty taxpayers to whom I have referred there are only six spouses, so they have not an abundance of family responsibilities. The 60 taxpayers have 10 first children and 13 other children, so that their combined income is shared between a total of 89 people. The taxpayers to whom I refer are entitled to claim deductions for the 23 children. For each such taxpayer there is a deduction of $116 for educational expenses or a total education deduction of $7,000 for 23 children. In addition there is a deduction for medical expenses of $733 for each of the 60 such taxpayers and a deduction for life assurance and superannuation payments of $450. Honourable senators will realise that very few persons working under an award of the Commonwealth Conciliation and Arbitration Commission could afford to spend the amount that can be claimed as education expenses, or the amount claimed by this group of 60 taxpayers for 23 children. If a person working under a Commonwealth award had to find medical expenses amounting to $733 he would have no chance of being able to pay $450 in life assurance premiums for himself or his family. I take heart from the fact that the Government has said that it needs more time and that we are now on the road to creating a welfare state, but I believe that there should be greater benefits. I would seriously question our approach to social security. I suggest that additional finance must come into the Treasury to finance the introduction of greater social welfare benefits. I suggest also that consideration should be given to a more equitable distribution of the wealth of Australia by recasting our whole taxation structure. Although under the Budget pensioners have been given an additional $1 a week, the Government will be taking back a proportion of it in increased taxes on every item and commodity that they purchase from the range of goods which are subject to the higher rate of sales tax. The sixty taxpayers who each, after paying tax, receive about $72,000, pay the same as anybody else for a bar of soap with which to wash themselves, for toilet requisites and for other commodities in general use which are taxable. The Government receives the same amount from the wealthy as it receives from pensioners when they purchase these items. By indirect taxation the Government receives a contribution to taxation in accordance with the number of mouths to feed and the number of bodies to clothe - not in accordance with ability to pay. I ask seriously for a reconsideration of the structure of the Australian system of taxation. {: #subdebate-30-0-s4 .speaker-K69} ##### Senator SIM:
Western Australia -- I am always intrigued when I hear someone speak of a Budget as being an uninspiring Budget or not an inspiring Budget, as **Senator Cavanagh** did, because I am at a loss to understand how a Budget can be inspiring and whom it is supposed to inspire. A Budget has the responsibility for stating the economic climate for the ensuing 12 months and, indeed, for the years ahead for a country. It seems to me that this is some journalistic phrase which has been conjured up and that it has no meaning. If we are to regard the Budget as I believe it should be regarded, to criticise it on those grounds is to use a rather puerile sort of argument. **Senator Cavanagh** criticised the Government, at least by implication, for intervening in the hearings of wage cases before the Commonwealth Conciliation and Arbitration Commission. I do not want to say very much about this, but I believe that the Government has a clear duty to place before the Commission its views on the economy. If I have any criticism of the Conciliation and Arbitration Commission it is that in its determinations it has paid little or no regard to the position of the great primary industries of Australia and their capacity to meet the ever increasing costs in which wages play a not inconsiderable part. I am delighted to see that in the present hearing the Commission has had this view put before it very strongly. When we look at the primary industries we realise that possibly the Government should take some action to alleviate this cost problem - I shall speak of that in a moment - but the Government has no control over another major factor, that is, the whole question of wages. I am not arguing that we should have a low wage economy; I am suggesting that the Conciliation and Arbitration Commission should put great weight on the capacity of rural industries to meet increased costs brought about through an ever rising wage structure. If it does not do so, in time we will kill the goose that lays the golden egg. Before referring to tariffs, with which I shall deal very briefly, I should mention that **Senator Cavanagh's** speech was mainly an apology for the Russian invasion of Czechoslovakia. I suggest that nobody - not even the Soviet Embassy - really believes that anybody would take seriously the humbug and nonsense that has been pouring out for our information over the past weeks to justify an act of sheer naked imperialist aggression. To argue that what is happening in Czechoslovakia poses a real threat to the security of Russia is nothing more than sheer nonsense. The only threat to Russia posed by what is happening in Czechoslovakia was the great urge among the people of Czechoslovakia for freedom and greater liberty, economic and political, and the fear in Russia that once they achieved this freedom it would spread throughout East Germany and Poland and into Russia itself, that it would weaken or destroy the whole base of that totalitarian Communist regime. To ask this Parliament to believe, as **Senator Cavanagh** suggested we should believe, that the security of Russia was threatened by some Western capitalist plot is absurd. I should like to say a great deal more about this, but my time is very short. I want to turn now to the question of tariffs, a subject that I have spoken of before in this Parliament. In the community today a tariff debate is raging. Some of us have been bombarded with all types of propaganda, from various sectional pressure groups. I do not mind this. They have a right to put their view. They have a right to protect their own interests. However, when I and other members of Parliament receive from the Textile Information Service, as I did on 14th August, a publication which quotes **Sir Robert** Menzies in support of its opposition to the present plans of the Tariff Board to classify industry, but quotes **Sir Robert** Menzies in a speech that he made on the Vernon Committee report and on a proposal that bears no relation at all to the functions, duties or responsibilities of the Tariff Board, then I think it is time that we questioned the motives of these people. The following statement by **Sir Robert** Menzies is cited in this document: >In the Australian democratic system of government based upon the consent of a free community, no government can hand over to bodies outside the government the choice of objectives and the means of attaining them in important fields of policy, particularly when such bodies would, through the power of publication, come to exercise what I have described, I hope not extravagantly, as a coercive influence upon governments. In relation to this the Textile Council states: >The above policy statement is worth noting today in the light of the Tariff Board's proposals relating to an 'Allocation of Resources' listing of industries. However, this statement was made, as I have just said, on a proposal which had no relationship at all to the Tariff Board. I do not believe that the textile industry is unaware of the speech that **Sir Robert** Menzies made in 1962 in a John Storey Memorial Lecture which is recognised and accepted as one of the most authoritative statements made on tariff policy. The industry cannot be unaware of this. If it wants to cite **Sir Robert** Menzies in relation to tariffs, in all honesty it should have cited extracts from this speech and not from a speech which bears no relation to the Tariff Board. With the indulgence of the Senate, I take a few moments to put the record straight. After dealing with the Conciliation and Arbitration Commission, **Sir Robert** said: >But the Tariff Board is in quite a different position. It is a purely statutory body, created by the discretion of Parliament and, indeed, subject to the control of Parliament. In this sense, it is an instrument of policy, and in no sense its master. > >It has, however, been recognised by successive governments that, though what I have said is constitutionally true, it is important that, for international as well as domestic purposes, the Tariff Board should possess- a high measure of independence, that the integrity of its advice should be preserved, and that it should not be subject to any form of day-to-day political instruction. I accept and maintain these propositions. If time permitted, I could cite more extracts from this speech by **Sir Robert** Menzies. It appears to me that those - such as the textile industry and the Chambers of Manufactures - who today are maintaining a campaign against the Tariff Board, should adopt some policy of consistency. In the past when the Tariff Board has accorded them, in many instances, a high level of protection, they have not been known to criticise the Board, to attack it, to attack its integrity and, indeed, to attack its functions. They have regarded the Tariff Board in the light in which we all regard it today. It is only when they feel that their entrenched position might be threatened by the review by the Tariff Board of high protective areas that we find this attack mounted against it. I join with my colleague, **Senator Bull,** and other members of the Parliament who have spoken to express support for the independence and integrity of the Board and to decry the attacks that have been made upon it and the calls being made on the Government - which it has resisted, to its credit - to interfere with the independence of the Board in these matters. The view which has grown up in this community and which has been supported by many industries, that once granted protection industries have an inalienable right to have that protection continued ad infinitum regardless of changes in markets, technology or economic conditions, cannot be supported. The Board intends to review areas which have received high protection over many years and in relation to which there has been no review of the protection, in order to see whether it is justified in today's economic and technical conditions. The Vernon Committee had before it this view and in its report came out very strongly in favour of the attitudes and policies being adopted today by the Tariff Board. In paragraph 14.29 it stated: >A strong, although in our view unwarranted, presumption is gaining ground that an industry, once in existence, should be protected and that, once protected, should continue to receive the protection it needs even if its cost disabilities rise to high levels. In paragraph 14.31 it stated: >The Committee does not propose to adopt a doctrinaire attitude to this problem. It recognises that circumstances which at first justify protection for an industry may vary when conditions overseas change. However, the general principle is clear - permanent special protection for an industry that has ceased to be economic and efficient should not be regarded as a matter of right. The Tariff Board cannot be expected to shelter industries indefinitely from changes in technology and the market Those of us who today are supporting the Tariff Board in its review, support these views which have been expressed by the Vernon Committee, by **Sir Leslie** Melville - a former chairman of the Tariff Board - by **Dr Coombs,** by **Dr Corden** - a great authority on tariffs and a man of great knowledge who today is a Nuffield lecturer in economics at one of the universities in England - and by many other authorities. I close by quoting from the remarks of somebody who no-one could deny is an authority, **Sir John** Crawford, former Secretary of the Department of Trade and Industry. To his book 'Australian Trade Policy' he wrote a postscript just before it was published. I believe that his words must be noted. I cite them because they support those of us who are defending the Tariff Board, who recognise that the cost structure of the Australian economy is imposing an ever-increasing burden on our primary industries and are therefore anxious that the Tariff Board, recognising this fact, should be free to undertake reviews and inquiries free from sectional pressures and free from attack. **Sir John** Crawford wrote: >But tariff protection has had costs, borne by all industries and of critical importance to the export industries and import competing industries which are not able to pass these costs on. Under free trade these industries might not have required protection. Added to these problems, we have today two or three new developments which call for more care in the application of tariff policy. We now have major capital-intensive secondary industries which need a large market for economies of scale. These need to be highly rational in their production structure and high tariffs alone will neither ensure this nor encourage them to enter export . . . The Board is fully justified in making a tougher examination of applications for levels of protection which are high relative to the general cost disability level. The detailed proposals of the Board revealed in its annual report for 1966-67 may not be the last word, but it was pleasing to read the evidence of intellectual questioning, of greater unity in the Board, and of its apparent determination to keep the cost of tariffs in mind when deciding whether or not protection was justified in particular cases. All I say now is that the views of **Sir John** Crawford support entirely the views which **Senator Bull,** I and others have expressed in this Parliament over the past 2 or 3 years. I hope that when the Tariff Board report is published we will have an opportunity to debate it at greater length than is possible today. 1 have risen today only to express again my strong support for the Tariff Board and the view that tariffs play a substantial part in the cost structure of Australian industry, particularly our rural industries. In the present state of our rural industries every effort must be made by the Government - in the final, analysis it is responsible for tari IT policy - and the Parliament to ensure that, only those industries which meet the criterion of being economic and efficient, and only those industries which make a .substantial contribution to the development of Australia, are given protection. 1 repeal what I have said before - we must bend every endeavour to ensure that the small amount of investment available in Australia and our scarce skilled labour are channelled into those industries which assist in the low cost development of this country. We cannot afford any other policy. {: #subdebate-30-0-s5 .speaker-JZQ} ##### Senator ANDERSON:
Minister for Supply · New South Wales · LP -- I want to make it clear at the outset that I am not, in the strict sense, closing the debate, because an amendment has been foreshadowed. Therefore, once we dispose of the amendment proposed by **Senator Murphy** the way will be clear for **Senator Byrne** or **Senator Gair,** whoever is concerned, to move the foreshadowed amendment. For ordinary purposes, the main debate on the Budget has taken place and therefore I am speaking to **Senator Murphy's** proposed amendment. 1 express my congratulations to those new honourable senators who made their maiden speeches during the Budget debate. I was able to be present in the chamber to hear all except, I think, one of them and that one I was able to hear in my office where I was working on some documents. I congratulate them all. There is no doubt that the debating strength on both sides of the Senate will be improved markedly - that is not a reflection on the older honourable senators - because each brings to the Senate a point of view, a conviction and a sense of responsibility in being a senator in the national Parliament. I wish them well. We will not always agree but that is the way our democratic processes work. As ! have followed the debate, there doss not seem lo have been any really serious challenge by the Leader of the Opposition **(Senator Murphy)** or by his supporters to the concept, construction and economic theory propounded in the Budget. I do not believe that the Government's assessment of the current and prospective economic situation, which is reflected in the Budget proposals and the Budget Papers, has been put under serious challenge although there has been a wide range of disputation and points of view have been expressed in relation to isolated matters. During the Budget debate there has been an acknowledgment - the Opposition has not disagreed with it- of the Government's approach in giving a special place in the Budget to the objective of helping the aged, the sick and the needy. **Senator Murphy's** amendment seeks to add, at the end of the motion that the Senate take note of the papers, the following words: but the Senate is of opinion that the Budget is inadequate in that it does not make provision- and he nominated four heads in relation to which he said that the Budget failed. Very briefly - I do not propose to spend a great deal of time on them - I propose to deal with each one in turn and to comment on them. The first head of complaint is that the Government failed - to lighten taxes and health costs for families and to increase benefits. To reply to that claim let me turn to the text of the Budget Speech wherein the Treasurer **(Mr McMahon)** under the heading 'Health' had this to say: >In the field of health services we have given special attention to the burden of costs that can fall on those afflicted with long continuing illnesses. We had already undertaken to assist those suffering in this way. Toward fulfilling this undertaking, two additional benefits are proposed. > >First, an insured hospital patient suffering from chronic, pre-existing or long-term illness will be paid, regardless of the length of stay in hospital, the full amount of benefits, including the Commonwealth hospital benefit, for which he or she is insured but the amount so paid will not exceed the hospital charges. This increased benefit will replace the present benefit of $5 a day and will operate from 1st January 1969. > >Secondly, we are introducing a supplementary benefit for those patients in approved nursing homes who are medically classified as in need of intensive care in a nursing home. It will be payable from 1st January 1969 and will add $3 a day to make the total benefit for these patients $5 a day, regardless of the length of illness. We are introducing a new benefit also for children under 16 accommodated in homes for handicapped persons conducted by religious or charitable organisations which provide medical or paramedical treatment and nursing care. This new benefit will be payable from 1st January 1969 at the rate of $1.50 a day for each child. We intend to increase as from 1st September 1968 the subsidy now payable to approved organisations providing a home nursing service. For organisations established before September 1956. the annual subsidy for each nurse over and above the number employed at 30th September 1956 will be increased from $2,200 to $2,600. For organisations formed after that date, the subsidy for each nurse employed will be increased from $1,100 to $1,300 per annum. For **Senator Murphy** to claim that there is a failure on the part of the Government to lighten health costs for families and to increase benefits shows that he has not read or taken on board the Treasurer's Budget Speech. To me, the position is stated in simple plain language for all to understand. The Government's proposals are an important part of the Budget in relation to the point 1 made earlier that we are giving serious consideration to additional contributions to the National Welfare Fund. **Senator Murphy's** second head of complaint relates to the Government's alleged failure: to plan defence procurement and expenditure. Naturally I turned to the report of his speech to learn what he had said in support of his proposed amendment. I found that his argument is based on a passing reference to the Fill aircraft and an all-embracing reference in these terms: Other examples of appalling waste and maladministration in the defence departments have been aired in debates in this Parliament. That is the substance and the strength of his complaint. I should have thought that was hardly the way to make an argument against the Government's proposal to spend some $1,2 17m on defence which, as he acknowledged, represents an increase of 9% on last year's allocation. He indicates a lack of understanding of the Budget proposals on the defence level. Although expenditure on defence this year is estimated to total $1,2 17m, a large proportion of that sum, namely $471 m, will be taken up in pay and allowances for Service personnel, civilian salaries and the general running expenses of departments in the defence group. The cost of arms, armament and equipment for the Army and equipment and stores for the Navy and Air Force is estimated at $245m. The Government will be spending $179m on the purchase of aircraft for the RAAF and $49m on the constructon of ships for the RAN. The maintenance of our forces overseas - apart from pay - is expected to cost $62m. The cost of accommodation and technical facilities for the defence group is estimated to run into $87in. I. do not think that **Senator Murphy** can make out. a case for that part of his amendment simply by saying: 'Other examples of appalling waste have been aired in debates in the Parliament'. That hardly commends itself as a forceful debating point. **Senator Murphy** apparently misses the whole significance of the broad spread of the Government's defence responsibility and the defence commitment that is outlined in the Budget. The third ground of **Senator Murphy's** attack is that the Budget is inadequate in that it does not make provision to meet the problems of Australia's capital and provincial cities. But the honourable senator dealt with that head of his amendment merely by posing the ten-word question: Where are the programmes for the revitalisation of the cities?' I .am a layman, but I would love to have an opportunity, in different circumstances, of cross-examining him as to what he really means by those words. They are very vague. So this part of the amendment has no basis. As I have demonstrated. **Senator Murphy** did not sustain an argument at all. I refer now to the- role of the States. We all know that responsibility for expenditure in many fields that are important in terms of development and general community welfare - not least in the urban areas - rests with the States and their authorities. Whilst I recognise that the Opposition may have some views on the function's of States in a federal system, nevertheless that is where the prime responsibility lies and, indeed, that is where the States want to keep it. The Slates are very jealous of their sovereignty. I think it is fair to say that all honourable senators, who come here representing the States, are very strong in their advocacy for the retention of sovereignty by the States. Clearly the Leader of the Opposition has chosen to ignore State responsibilities. {: .speaker-KVK} ##### Senator Mulvihill: -- Does the Leader of the Government think that- the reimbursement formula is all right at present? {: .speaker-JZQ} ##### Senator ANDERSON: -- Do not be provocative senator. The Commonwealth is criticised for financially squeezing the States and their authorities. J suppose that is the matter that **Senator Mulvihill** is very gently and courteously referring to. But let us consider the Commonwealth grants to the States. These are expected to show a somewhat smaller rate of increase this year than last year - 8.3% as compared with 1 1.2%. But there is a very good reason for this - a reason that is very well known to all honourable senators because, it has been revealed during preceding, budget discussions. The percentage is distorted by the fact that last year the Commonwealth provided very large amounts to certain States to help them deal with special problems created by national disasters - drought in four Slates and bush fires in Tasmania. In any case, the- prospective rale of increase in these grants is larger than the estimated increase in total Commonwealth expenditure. Certainly there is no ground for arguing that the Commonwealth i'! squeezing the States to make room for an increase in its own expenditure. I repeat that **Senator Murphy** dismissed the third point in his amendment with an almost hypothetical question of ten words. The fourth head of attack in the Leader of the Opposition's amendment was that the Budget *was* inadequate in that it did not make provision for. the retention of control1 of and for the promotion of development of, Australia's mineral, fuel, land and marine resources. Here again I thought that as this was his point of view. 1 should go to his speech to see how he developed his argument. Bui he did not develop his argument. He gave a lot of generalities and he said a lot of words but he did not give any particular cases. For. that reason, I find it very difficult to understand what he really means by retaining control. He did not spell it out. From sitting opposite him in this chamber for quite a while now I think I know what he is referring to. But he did nol spell it out in his speech. I could ask: Did he mean the old Socialist approach of taking control? He did not say so. I rather think he was talking in terms of equity control. The suggestion that there is a lack of national development in Australia is denied by everything we see happening before us, and- particularly by what we have seen happening during the last decade. I seriously suggest that we are enjoying the greatest era of development in our history. There is no shadow of doubt about that. This has been achieved by Australian and overseas investment. In this way we have been able to find gainful employment for our people and we have been able to continue a high migration intake, which is essential to our very existence in the long run. Alt these things are inevitably tied up with development. If we did not have development and the consequential infrastructure we would not be able to sustain a high migrant intake and we would not have the present high rate of employment in secondary industry. Today there is security for our people. I find difficulty in following **Senator Murphy's** line of argument. Growth and development depend on giving the private sector opportunities and scope for expansion. They also depend on keeping living standards growing so that we can continue to attract the migrants we need. I have dealt with that. They also depend on the amount of private investment and private saving within Australia from Australian resources and on the extent to which these moneys are supplemented - through keeping this country attractive to overseas development capital - by resources from abroad. I have almost finished the points that I want to make in reply. But I wish to say that the size of overseas participation in the economy is frequently exaggerated. There was a record inflow in 1.967-68, but, taking 1 year wilh another, overseas capital has been contributing only about 10% of our gross domestic capital formation, lt is difficult to measure precisely the cost of overseas capital to Australia, but one of the more meaningful indicators would be the ratio of net income payable by overseas companies to net national product. In recent years this ratio has been around 2% or even lower. A' lot has been said about overseas investors, but it is often forgotten that overseas investors are subject to Australian tax on their operations here. Pay-roll tax and other imposts both of the Commonwealth and the States and their authorities, have to be paid in respect of industrial and commercial operations here in just the same way as if the operations were being carried out' by Australians. A substantial proportion of any profit made by overseas firms from such operations accrues to the Commonwealth as income tax. Thus profits made here by an overseas company are subject to income tax, the general rate of which we propose to increase to 45c in the $1 in this particular . Budget. It was 42±% previously. Then, if the after tax profits are distributed overseas as dividends they are subject to our dividend withholding tax. The general rate of this withholding tax is 30%, or 15% if the dividends are distributed to the countries with which we currently have double taxation agreements. So that not only do these big undertakings provide tremendous employment opportunities but they provide revenue in the form of taxation and the normal charges that are applied to them by Stale instrumentalities. 1 find it difficult to follow the argument which is so frequently heard here against overseas capital. In fairness to **Senator Murphy,** I think he did say that he was not opposed to overseas investment as such but, in the generality of his speech, he went on to make all sorts of comments in relation to it and I suggest that if we adopted as Government policy what he suggested in those remarks it would tend to frighten overseas investment away. After all, overseas investment is a very shy bird. We are a young country. Because we need development and people, and because it is not possible with our own population of 1.2 million to finance our own capital development, we need overseas capital. Is anybody going to suggest that what has happened in Western Australia, what has happened in Queensland and what is happening in relation to the search for oil, in all of which things there has been a degree of overseas investment has been wrong for Australia? Is anybody going to suggest that the overseas investment in these ventures has put the progress and development of Australia back? Anybody listening to arguments put here and in another place must inevitably be forced to the conclusion that the investment of overseas capital in Australia is evil and is doug harm to us. God help us, it is making us. {: .speaker-KPG} ##### Senator Keeffe: -- We do not say that; we say there is too much of it. {: .speaker-JZQ} ##### Senator ANDERSON: -- I would say that it is fair comment to say that 90% of all the speeches that are made by the Opposition here and in another place are attacks on overseas investment. The Opposition attacks it and then says it is not so bad. The ACTING **DEPUTY PRESIDENT (Senator Bull)** - Order! There are far too many interjections. {: .speaker-JZQ} ##### Senator ANDERSON: -- It is quite all right. I do not mind a little bit of interruption, although I know we have to conform to your ruling, **Mr Acting Deputy President.** 1 conclude on the point that Australia's future international security and Australia's future in terms of our internal economy need this investment capital. Because we have not got the capacity to generate it, we have encouraged overseas investment in Australia and, wherever we can, we encourage Australian equity in that investment. As a result of this policy, we read in the Press of tremendous development. As we travel throughout Australia we see signs of tremendous development and tremendous employment opportunities for our people. We also see tremendous industrial development in our city areas. Contrary to what **Senator Murphy** says, we see great development in our capital cities and in our urban areas as well. All these things are the hallmark of good government. They are the hallmark of a sensible approach. They are an indication that we in Australia have a destiny. But that destiny can never be fulfilled if we are going to live in our own backyard. If, because we have not got a cricket bat we say that we will not go and get somebody else's and therefore will not play cricket, we are going to be insular. If we adopt that policy we are going to fall short of achieving our destiny. For all those reasons, we oppose the amendment and trust that the Budget papers will be noted so that we may be able to proceed to a consideration of the Estimates. Question put: >That the words proposed to be added **(Senator Murphy's amendment)** be added. The Senate divided. (The President - Senator Sir Alister McMullin) AYES: 0 NOES: 26 Majority . . 4 AYES NOES Question so resolved in the negative. {: #subdebate-30-0-s6 .speaker-K3R} ##### Senator BYRNE:
Queensland -- I rise formally to move the amendment that I foreshadowed in the Senate last night. I move: The ACTING **DEPUTY PRESIDENT (Senator Wood)** - Order! Is the amendment seconded? {: .speaker-KKP} ##### Senator Gair: -I second the amendment. {: .speaker-K3R} ##### Senator BYRNE: -- During the past few weeks we have had the opportunity . to hear a number of initial speeches from newly elected members of the Senate. Perhaps it is not for me, as one who has embarked upon a postgraduate course in parliamentarianism, to join in the tokens of praise that have been directed to those honourable senators. But as one who has had a fairly long association with the Senate I believe that I should express my keen personal pleasure and gratification at the contributions that have been made from both sides of the chamber. As the Senate more and more assumes an important position in the political structure of this country and more and more assumes the role of a House of Review, the infusion of debating strength and individual knowledge in particular and specialised fields can add greatly to the capacity of the Senate to discharge that function. We have had the opportunity to learn from all the maiden speeches that have been made that the honourable senators who made them have knowledge and interest in particular fields. The accumulation of that knowledge will add to the pool of wisdom in the Senate which will guide us in our deliberations. I believe that the Senate has occasion to be very grateful to all of those honourable senators. The document which is now before the Senate, and to which the motion that is the subject of the amendment I have moved is related, is perhaps the most important single act of the government in any one year. The annual Budget has a tremendous significance. I agree with **Senator Cotton,** whose speech I followed with keen interest and attention, as did all other senators, that the Budget assumes such a position of importance and is such a singular act. of government power and authority that on an occasion such as this it should be discussed in technical terms as the instrument that it is and for the purposes and ends that it seeks to achieve. Many speeches have been made in the course of the last few weeks. Many of them have been directed to particular aspects of the effects and implications of the Budget. But I believe that' it is a prime responsibility of this chamber to attempt to assess the Budget as an economic instrument and to assess its full force and effect. It is on that basis that I trespass upon the time of the Senate this evening. It is not my purpose - I would not consider myself other than presumptuous if it were - to deliver to honourable senators a lecture on the nature of the Budget. But, because it is impossible to assess the real .impact of the Budget and to make an objective assessment of its likely effects and consequences without some discussion of its nature and purpose, I will trespass on the available time in order to make some observations on its nature and purpose. At any stage the objective of a government in office is to do two things, as I understand the position in a modem society. The first is to raise the general level of national income; that is, to make the society more wealthy.. The second is a matter of social justice and is to ensure a fair and adequate distribution of the consequences of such rises in the national income as are created. To achieve both of those purposes, certain techniques are employed. One is- the maintenance of full employment. That is perhaps the most vital instrument in securing a welfare society and keeping it at a level of constantly rising national income. A second is the mobilisation of the available natural and national resources to the best possible advantage so that, with labour applied to them, they can be directed to the achievement of the dual ends of raising' the national income and ultimately distributing it equitably and justly. In a modern economy various instruments are used to achieve those purposes. In Australia we use particular instruments which in a sense are peculiar to this country. Perhaps we can say that five major economic instruments are used. Reference has been made lo one of them today. 1 acknowledge **Senator Sim's** contribution in which he referred to the significance and importance of the Tariff Board. One of these major economic instruments is the Tariff Board. The second is the Reserve Bank - the central bank. The third is the Loan Council and the consultations of the State Premiers in relation to loan works programmes. The next is the Commonwealth Conciliation and Arbitration Commission. The last is the document that we are now discussing - the annual Budget. Those five great instruments are used in modern societies, and particularly in the Australian society, to achieve the purposes that I have attempted to "describe. Of all of them,' perhaps the Budget is the most important. * Because comments have been made about them, 1 think it is important to put a number of these instruments in the context of the purposes that they were designed to achieve. One of the instruments is the Arbitration Commission, which is a completely judicial body and is totally independent in its deliberations and conclusions. {: .speaker-KBW} ##### Senator Wright: -- To which body is the honourable senator referring? {: .speaker-K3R} ##### Senator BYRNE: -- The Arbitration Commission, lt is a judicial body which hands down wage determinations. It operates independently and judicially. The question - and it has been raised - is. whether such a body should operate in total disregard of the general economic' climate, in which its decisions will be framed and permitted to operate. If we recognise that modern society is controlled to a' large extent: by the instruments 1 have mentioned, we must recognise that all the instruments must work in some measure of harmony. The Arbitration Commission could destroy its' own effectiveness' if it were to work in total isolation, so that- its decisions had to be accommodated 'by -great stresses and strains in the other sectors of the economy. That does not say that that judicial body must necessarily, in a complete and final sense, be governed by the economic conditions, but it does say that its deliberations cannot properly and reasonably be handed down without an awareness of and advertence to the economic conditions. Therefore, when we look at the Budget as we are looking at it today, we are looking at one of the great instruments of our society. It is somewhat more than that in the parliamentary democracy of which we are part. In addition it fulfils the role that is fulfilled in the American society by the President's State of the Union Message. lt is, as it were, a review of the whole spectrum of the Government's policy translated into financial and economic terms. Therefore, in a sense, each Budget is a most unique instrument. 1 have been associated intermittently with Budgets for some years. One thing which is significant is that the character of the Budgets has changed over the years. Budgets presented as recently as 8 or 9 years ago were fiscal documents that set about handling only the cash position - virtually the cash in and cash out in the economy. They did not purport to be instruments of economic control or economic direction. The papers presented with past Budgets were limited in number and mostly completely financial in character. When I look at the documents which accompany this Budget, the terms of the Budget and the propositions it incorporates, I see that the Budget is framed as an economic instrument and that the statements of national income and expenditure and the economic propositions contained in the documents accompanying the Budget are the important considerations which affect the Government in the framing of its financial policy. The Budget, by use of the fiscal instrument, brings about physical changes in the community and in the ebb and' flow of capital in various fields of exploitation and development, as well as in the provision of services by the Commonwealth Government to the community. Ultimately the purpose of the Budget is to bring about this type of physical alteration. The Budget remains today, as it was on the night it was delivered, a totally enigmatic Budget. On that occasion I was not able to discover what its ultimate economic purpose would be. I sought from the conclusions of the Press to discover its possible and ultimate economic effect. The' opinions were as many as there were those who attempted to canvass it. Was it an inflationary or deflationary Budget? Was it a Budget of contraction or expansion? Today there are as many opinions as there are people who choose to read the instrument. I agree completely with **Senator Cotton** that we must examine any Budget, particularly this Budget, to discover the central theme. Every Budget, if it is to be a viable and effective instrument, must have a theme. What is the theme of this Budget? We can only assess the merit of the Budget by ascertaining what is essays to do, how it goes about it, whether what it purports fo do is what it should do and whether that is in the best interests of society. In introducing the Budget, the Treasurer **(Mr McMahon)** said: >From the economic standpoint we have aimed to provide a budgetary context for stable and wellbalanced growth. He also said: >The critical question is not so much whether the Budget is expansionary or otherwise. . . . Apparently the Treasurer was not quite sure of its ultimate economic effect or else he realised that there would be a lot of speculation as to its effect. He continued: {: type="i" start="1"} 0. . but whether its effects when combined with the other influences at work will be likely to keep the economy growing in conditions of internal and external stability. I would say that the theme of the Budget very definitely is that it should be a Budget of growth; that the Treasurer and those assisting him conceived that the most valuable need in Australia today is growth; that as many other considerations as necessary should be put aside for growth and that growth has been lifted to a position of supremacy above all other considerations; and that it is on that basis that the Treasurer expects the Budget to be assessed and evalued. I suggest that because the Budget is framed in that context the Government, fascinated by the momentum which has been created by Government assistance and private enterprise over the past few years and fascinated by growth, has put aside many considerations and overlooked many factors of vital importance in the community which we cannot afford to have put aside in a society such as ours and more particularly in a society towards which Australia is now moving. One factor which is and purports to be the object of a Budget and of government policy is to assist in the creation of additional national income and to provide for the just and equitable distribution of national income. Whether this Budget fulfils the first requirement, in very vital sectors of the community it certainly does not fulfil the second requirement, lt is on that point that we must challenge the desirability of a Budget framed in these terms and with this objective. There are great sectors in the community today that will not share in the distribution of national income at a just and equitable level and more particularly in the distribution of income at the level which is available in this increasingly wealthy society. On the Senate Bu.sine.ss Paper there is a motion in relation to pockets of poverty in the community. 1 have heard that term used by honourable senators in the course of many contributions to the debate. When we consider the effect of the Budget we must examine what we call pockets of poverty existing in the community. At this point I am not discussing pensions as such: T am discussing the position of the pensioner group as one of these outcrops of poverty which must give the nation cause for very great concern and very deep anxiety. No doubt honourable senators will be aware of a survey made a couple of years ago in Melbourne by Professor Henderson ot the Economic Research Bureau. He investigated closely, by personal visits and individual examinations, the circumstances of large numbers of people in the city of Melbourne. I am sure honourable senators will be familiar with the documents that emerged. That was 2 years ago. Recently the same documents were presented in Brisbane at a seminar on poverty in the community. Obviously the position recited in those documents still persists today. Apparently it is not peculiar to Melbourne. While precise figures may not be available for other cities, particularly Brisbane, the seminar indicates that the situation in Melbourne is not peculiar to Melbourne but is reflected in other cities, capital cities in particular, all over Australia. The survey in Melbourne showed that 1.4.6% of the aged people who were investigated were living below the poverty line. Another 4.1% were considered to be marginal, at a level perhaps a little above the other group. The function of government is not only to create national income. It should ensure that it is equitably distributed. Surely this is one area in which there is a denial of the validity of the propositions incorporated in the Budget. There is very little suggestion in the assistance given to pensioners at various levels .that it is adequate to lift those people above the disclosed level of poverty, lt is extremely serious to find that state of affairs in a society such as ours but it is only the beginning of a story which is equally appalling in other fields. The Treasurer said in his Budget speech that in a sense this is a welfare Budget. He said that the Government had particular solicitude for one group in the community. He went on: >We owe another debt - a debt to those who have done their day's work and are now aged and infirm- To use **Senator Greenwood's** words, that is a very acceptable emotive expression, but that emotive expression has certainly not been carried into practical application. The amounts that have been handed out have done nothing to eliminate the pockets of poverty re flee red in the statistical analysis which has been conducted. I come now to a group of potential pensioners who are affected by the means test. This is one reason particularly why we of the Democratic Labor Party voted against the amendment moved by the Opposition. This is one of the most iniquitous features bearing on the community and it goes beyond a mere denial of justice. Lel us examine the position of people who are suffering under the application of the means test. I think it was **Senator Greenwood** who referred to the high level of savings in Australia and said that our community is exceptional because of the high level of personal savings. The people who are the victims of the means test are suffering for having been prudent and provident. They are the people whose life's efforts are being relied upon to justify the economic propositions propounded by the honourable senator. These people are being denied the consequences of their own thrift, lt seems greatly unjust to me that in our society a great deal of the loan moneys which find their way into works programmes is institutionally provided. That money comes from superannuation schemes and funds of that nature. Much of that money comes from the thrift of people who are being deprived of the benefits of (heir thrift by the application of the means test. Yet by the work they have done in their lifetime they contributed to funds which, even though the contributors are in physical retirement, are still in a financial sense contributing to the positive operation of the community in which the contributors were once working units. In other words, their active work for the community goes on after their physical participation has ceased. These people who are being denied the fruits of their own thrift have contributed to funds which arc still being used by the community. The community is using the money they accumulated to help build the nation. In an increasingly affluent society they are denied the benefits of their thrift. The Treasurer in his Budget speech protested that the Government has care for the aged and infirm and those who have played their part. That protestation is not borne out by any practical promise, hope or suggestion of the parial or future amelioration in any major degree of the incidence of the means test. The children in the community are our future citizens who will make the nation great. At all times they must receive the solicitude of the nation, particularly a young and underpopulated nation. They should receive the particular solicitude of the Government. When I study a survey made by the institute to which I have referred in the southern part of Australia, I discover that there has been a total disregard of the children within our society. I will read from two schedules prepared by this research institute. The survey showed that the incidence of poverty is particularly severe among large families. 1 am not referring necessarily to families where the breadwinner is dead or has deserted. I am referring to what are called 'complete' or intact' families. Five per cent of families with 3 children were found to be living in poverty, as were 8% of families with 4 or more children. The survey showed that about 16,300 families with 4 or more children were living in poverty, as were about 10,000 families with 3 children. That is a scandalous situation in our society and nothing is done to alleviate it. The survey divided families into categories. It showed that 5% of the families were very poor, 4% poor and 16% marginal. Surely that is a tragic situation but there is no reference to it in financial terms in the expression of solicitude in the Budget speech of the Treasurer. It was found that 6% of children in Melbourne were living in poverty; about 16,000 families with 3 children were living in poverty and about 10,000 families with 4 children. About 17% of all family units were found lo be living on or just above the breadine. In families where there was only one parent because of death or desertion, 31% with 4 or more children were living in poverty; 41% of families with 3 children were living in poverty. That was thi result disclosed in our affluent Australian society. {: .speaker-KBW} ##### Senator Wright: -- Who has made those findings? {: .speaker-K3R} ##### Senator BYRNE: -- Later I will give the exact title of the institution that conducted the survey. {: .speaker-K1R} ##### Senator Prowse: -- What was the criterion of poverty? {: .speaker-K3R} ##### Senator BYRNE: -- lt was a needs criterion - people living above or below reasonable needs established according to an economic formula. 1 would have thought thai this document would have been circulated, and would have been familiar to honourable senators, lt is a significant document and later in my speech I will give the full title of the institute that produced it. The great danger in our society is that it has followed a certain pattern. It is quite true that what happens in the United States of America economically very often after a period of time happens here. In may ways we have gone through the American process of expansion, enrichment and development. That process may still be continuing, in that case we will ultimately arrive at the situation disclosed in America where, in spite of being the most affluent society in the world, it contains segments of poverty which apparently are virtually ineradicable. From those segments of poverty are springing many of the social and deliquency disorders of the great, powerful and wealthy United States. If that is likely to be the national process here, as we arc discovering new wealth more rapidly than we ever thought possible and moving into the American position of great national affluence, this is the time we must act, not later. We must move how to the discovery of proper remedies and the application of processes that will eliminate our pockets of poverty before they become chronic. Silling suspended from S.45 to 8 p.m. {: .speaker-K3R} ##### Senator BYRNE: -- Before the suspension of the sitting 1 had promised **Senator Wright** that during the suspension 1 would discover the exact name of the institute that undertook the research on poverty to which 1 referred in the earlier part of my speech. That body was the Institute of Applied Economic Research and the survey was conducted by Professor Ronald F. Henderson of the University of Melbourne in J 966. The findings were canvassed again at a seminar conducted by Frontier, an organisation which deals with such things in Brisbane, together with an additional paper by Professor Gates, Professor of Economics at the University of Queensland, in which the situation was substantially confirmed. 1 had been dealing with the question of poverty among children in the society and the proposition I had presented was that in an increasingly affluent society the Treasurer was putting the accent on national growth as measured by the gross national product and national income. I was suggesting that he was not according the correct priorities to other demands in the community. In particular I was pressing the point that there were areas of poverty in the social services field among pensioners and particularly in large families and among children. 1 had suggested that these areas should have received particular consideration in the Budget and that to that extent the fascination with growth, to the extent to which apparently it did fascinate the Treasurer and the Government, was not altogether appropriate. In this regard I wish to refer to a comparatively recent paper presented by **Dr Coombs** i i the publication 'Tariff Debate'. In this paper presented about 12 months ago he said: >Finally, of course, there is a point beyond which it is noi good sense to sacrifice present consump tion to the future. If I may make an illustration here- the recent somewhat disturbing reports of more widely spread poverty among the old and the sick in this State than we, most of us, would have been prepared to admit existed, does suggest perhaps that there are some claims on our current resources that should have some priority, even over those needed for growth. In that paper **Dr Coombs** sounded a note of warning at that time in the same terms as the warning I am sounding now. {: .speaker-KBW} ##### Senator Wright: -- What year was that? {: .speaker-K3R} ##### Senator BYRNE: -- This was stated by **Dr Coombs** in a paper presented in the Tariff Debate'. The actual paper by him was dated September 1967. I am submitting that the same consideration should be given effect by the Treasurer in the compilation of his Budget and that too much should not be sacrificed to growth. There are real demands for a spreading of national income among certain segments of the community and these have not received the proper alleviation of their plight that the situation - demands. {: .speaker-KBW} ##### Senator Wright: -- Why not do it by work? {: .speaker-K3R} ##### Senator BYRNE: -- As I said earlier, it is not a question concerning the two components which create national income - full employment and the proper utilisation of resources; the point is that once we have the national income we must provide for an equitable distribution. It is at this point that I am attacking the distribution - not the creation of the national income. I come to the second point, the proper utilisation of resources. That is one of the functions of economic planning, one of the things sought to be attained by a Budget of this kind, together with other economic instruments. In this connection I am stating that there may be a mobilisation of most natural resources in the community, but there is one resource that obviously has not been used, that is, the natural resources of population. I think that this is a most important consideration. We can mobilise all the other natural resources - our mineral resources, our oil resources and our primary production - but ultimately we must have people. The disturbing element is that we are not getting the reproductive growth rate in the community which is vital for the survival of society in a condition of expansion. The areas of poverty which are striking at the large families are striking at the very heart of something that is going to be disastrous for Australia if it is not now acted upon. In 1961 the national growth rate was 2.84%. It dropped to 2.78%, to 2.72%, to 2.58%, to 2.45% and in 1966 it had reached 2.32%. I am not a demographer, but I understand that the economic growth rate necessary to reproduce society is about 2.18%. In other words the population is still growing, but the growth rate is falling back. That is a very dangerous situation and one that, this nation cannot afford. That is why I think that to allow families to exist in this condition, in an area that is so critical to national development and ultimately to national survival, is inexcusable. In his Budget Speech the Treasurer repeatedly referred to immigration and there has been a very substantial additional provision for immigration, both in the immigration target and in the appropriation of moneys to tackle it. One or two excerpts from the Budget Speech might well indicate the thinking of the Treasurer on this point. He said that net immigration is rising and employment could increase by 3% this year. At a later stage in his Speech he reproduced the same type of thinking which indicates that he is placing a tremendous reliance on immigration as a means of mobilising the human resources of the nation. He said: >Our task is far too big for a community of 12 million people to handle with the means of production they can provide. And so we must keep our country attractive to immigrants and lo capital. The Treasurer obviously sees impending danger in the reliance on immigration. The immigration programme can be successful only so long as we can continue to attract immigrants. Here again we are striking a very difficult situation, as I wish to point out by reference to documents. But, significantly, whilst there is this accent on immigration, whilst an increased population is necessary to sustain and to expand the national growth, there is no mention whatever in the Budget of anything for what we might call the indigenous population growth. No incentive is given to the family. There is no mention of the family and no consideration of the family. The alternative is stressed, and stressed again. Immigration, in my concept, was originally a staff to be rested upon, to assist other forms of popula tion growth, but it has now become a crutch which is relied upon as an alternative. I think that is very unwise and, in the long run, very dangerous and. even disastrous. The figures indicate just how the accent is on the importance of immigration while disregarding population growth or anything for the family. In 1966-67 a total of 109,480 migrants came to this country. In 1968-69 the target is set at 160,000 migrants. In 1966-67, $33m was appropriated for migration. In the subsequent year that had grown to S36.6m, and provision for next year is $47.895m. That is a significant growth in the accent on immigration to stimulate the population growth. Let us look at the child endowment aggregate figures for the same period. In 1966-67 the appropriation for child endowment was $1 *98.2m,* in the next year it was $ 187.9m and this year it is $191. 6m. In other words, child endowment has fallen from the figure of 2 years ago. That is surely a tragic situation in this country. It is an incredible situation. The provision for this year is $4m up on last year but is $7m down on the preceding year. So we see the relative -balance in the figures for migration and the provision for the indigenous Australian family. This is a story which, is beginning to have very grave and threatening overtones. The maternity allowances in the period to which I. have referred rose from $7. 29m in 1966-67 to $7.3m in the following year, and the provision for this year is only $7. 6m. Here again there is an almost negligible increase which shows undoubtedly that something tragic is happening in our attitude to the indigenous Australian family. But what will be the outcome? What is the present situation of Australia and what is the future likely to be if this process continues? Let us lake the' present situation. Senators all around the Senate have in the course of their speeches adverted to its consequences in one way or another. Representatives of the Country Party have continually spoken of the vulnerability of Australian primary production to fluctuations in world prices, and that vulnerability will continue indefinitely if we have no substantial home market to take the burden of selling primary production. The problem of a continued heavy subsidy to primary producers will continue unless we can. build up a substantial and ever-increasing home consumption market. My friends of the Labor Opposition who have spoken said they were concerned about the exploitation of Australia's natural resources by overseas capital. What, is left for this country? How else can we do it? We speak of centralisation, but what is happening today? We are attracting overseas capital. It is exploring and developing our natural resources. I agree with **Senator Anderson** that that is very good, but it is certainly not the best. However, it is all that we can do - gouge out the wealth of our country and sell it to those nations which will fabricate it, because we have not the fabricating power or the population to do that and consume it in this country. That is one of the tragedies today, lt will be the continuing tragedy and all that this nation can expect in that field is that we shall go on gouging out our wealth, selling the product of it, and getting it back in fabricated form to be purchased by the Australian producer. That is only the beginning of the process, because as the population growth declines - and I shall show that immigration will not indefinitely take up the lag and cannot do it - we will have the primary producer and the secondary industrialist exposed to the vagaries of international market fluctuations. That is an extraordinarily serious situation and an extraordinarily gloomy prospect for this country. Professor Melville very recently, in the course of a paper also delivered in the 'Tariff Debate' adverted to this question of immigration as the prop on which we would bolster Australia's population. His prediction at that stage was rather gloomy and rather foreboding. His paper was delivered in January 1967. He gave figures showing increases in the national product of a number of countries and he went on in these terms: >These figures are all very uncertain. The broad picture, however, is clear enough that standards of living are increasing more rapidly in most countries of Europe than they are in Australia, and particularly in those countries from which many of Australia's immigrants have come. The Australian immigration policy in recent years has owed a lol to the employment we could offer the migrant from Europe and the attraction of a standard of living higher than he would otherwise expect. Australia has now ceased to be so attractive. Europeans can find employment in Europe and European standards of living are no longer everywhere much lower than they are in Australia. Other reasons for migration have also become weaker. In other words, what he is saying is that we have to be careful. Insofar as we rely on migration, we are relying on what might be. a diminishing factor. If we rely on it too substantially we will finish in a position of danger. At that stage this was only a forecast, but it has been confirmed iti the last two or three days by' the report of the Immigration Planning Council. Right through this report, in its conclusions, its analyses and its references to the various countries from which migrants might come, it is most pessimistic. Although the Council does not want to be pessimistic, nevertheless as an outcome it is quite pessimistic as to the continued possibility of getting migrants. It will take higher targets and it will take a tremendous amount of money, because more agencies and more determined campaign will be needed. {: .speaker-JYA} ##### Senator O'Byrne: -- They have never had it so good at home. {: .speaker-K3R} ##### Senator BYRNE: -- That is so. lt is alarming that standards of living are rising more rapidly in those countries than in Australia. We see that extra provision is being made, with the figure going from $36m to $47m this year. There is a tremendous leap forward in line with the increased target, which shows that it will be extraordinarily expensive to get these migrants - possibly much more expensive than it was before. That, unfortunately is the future that faces this country. I am concerned that in the whole of the Treasurer's Budget speech and in the financial provisions that he has made no significance is given to the family. No awareness is apparently held of the position of the family and the part that it must play in Australia's national development. As honourable senators will see in the amendment proposed by the Democratic Labor Party, that is one of the matters to which we give particular attention and for which we have particular concern. It is an extraordinary thing that in the modern society, where we have devised techniques for handling unemployment and attaining full or substantially full employment, where we have devised techniques to provide housing at a very high level, where we have devised techniques in the realm of health to provide services - contributory or otherwise - where we have conceived schemes to develop, we have never been able or prepared to conceive a national population policy. It is an extraordinary thing that we have never yet attempted to conceive such a policy. Perhaps it might be considered that 1 am a rather unexpected counsel in a rather foreign jurisdiction. {: .speaker-JYA} ##### Senator O'Byrne: -- lt is never too late, you know. {: .speaker-K3R} ##### Senator BYRNE: -- Thank you. But perhaps for that very reason 1 might have a more objective approach to the situation. lt is a fact that in this society, particularly in this period when there is an insistence on the observation of rights and demonstrations about rights, the rights that are always highlighted are either the right of the State or the right of the individual against the State. In other words, State-individual relations have to a large extent been polarised. But there is another unit, the unit of the family, which lies between the State and the individual. It is of tremendous significance and it has not attracted the attention of this society and certainly not of this Government, lt must be given its proper place in any national consideration of the great national issues. We are tremendously disappointed and very gravely concerned that the thinking of the Government should be along the lines which are disclosed in the Budget and in the financial provisions which have been made. The absence of any provision for the family poses a tremendous social challenge. It is not a matter that can be handled merely by the provision of sums of money; that is not enough. A sociopolitical approach to this is not everything. There must be a new national awareness of the significance of the family in the whole pattern and the warp and woof of national life. That is the new situation that we must try to develop. There must be a positive approach to this question. We must think positively about the importance of having a great population in this continent. After all, we know that it is the voter who ultimately has to pay the money for this purpose. Merely to impose a tax burden on them as a. way of financing gratuities may not be sufficient to attract their awareness of and alertness to this problem. Tt is a question, as it were, of educating the nation to see that there is this problem. It is a vital, acute problem and it will be a continuing problem. The nation must get behind its solution. If it does take the pro vision of funds, if it is a matter of education, if it is a matter of national interest, all of these things must be the responsibility of the proper authorities. They must be particularly our responsibility in this chamber and in this Parliament. {: .speaker-JYA} ##### Senator O'BYRNE:
TASMANIA · ALP -- -People will have families if they can afford them. {: .speaker-K3R} ##### Senator BYRNE: -- Yes, but that is not altogether the solution. Undoubtedly people who have not the economic means, as these figures may show, are very often disentitled. {: .speaker-KBW} ##### Senator Wright: -- Is **Senator O'Byrne** giving advice to **Senator Byrne** as to the individual contribution? {: .speaker-K3R} ##### Senator BYRNE: -- I would welcome advice from such a sophisticated source. It is paradoxical in this society, when we are on the threshold of great national achievement, when we have to solve so many problems, that we have never been prepared to direct our minds to this problem. I make a positive suggestion to the Leader of the Government who is at present at the table. We have in the Ministry a Minister for Immigration. I see no reason why there should not be in this country a Minister for Population whose duties would embrace the functions of the Minister for Immigration. After all, the question of population requires the co-ordination of so many things. One would be social services which affect the family. I have put that proposition previously to the Senate and we could well consider it. This may be a matter of greater seriousness than perhaps a casual reference would indicate, f am concerned that this nation so' early in its history seems to resort to the thinking that only a continuous and expanding immigration rate will solve our problems. I believe that is dangerous thinking. A positive approach by the Government is warranted. One of the greatest deprivations of the family lies in the matter of education. The family is the point at which the impact of educational economics is first discovered by parents. Couples with young families move to new areas where so often primary schools, particularly independent schools, have to be built. High capital costs are involved and it is necessary to pay teachers. lt is the yoting families least equipped economically to meet this situation who are confronted with it. As has been mentioned by a number of honourable senators, the provision of additional financial aid to primary schools, both public and independent, is becoming of increasing importance because unless, in the field of education and of social services and all ancillary fields, we are able to say that we have a national regard and concern for the family as a viable and significant unit in our society, we will strike these problems, the consequences of which we cannot altogether see at this point. Financial assistance for private schools has some economic advantages which have been canvassed in other places and in many learned papers which are presented from time to time. It seems that the nation is depriving itself completely of tremendous economic opportunities when it - is not generous to schools of this nature which are prepared to provide educational facilities at the highest level by dedicated people so long as funds are available. I point out that the cost is much less than the cost at which similar facilities can be provided by the State. As part of this general and new approach to the question of the significance of the family I suggest that particular consideration should be given to the provision of additional funds by the Commonwealth through the States to private and independent schools. 1 want to deal now with some of the other aspects of the proposed amendment which has been presented by the Democratic Labor Party and to refer particularly to defence. Our amendment states that the Minister's defence statement is inadequate. When one looks at the Budget Speech one finds there a short . comment in relation to the defence provision to the effect that it will provide for defence into the 1970s. If that is so, what exactly is the plan for the 1970s? We have been told that defence planning into the 1970s is part of a total defence programme which is under consideration and will be presented. There we seem to have two statements on defence - this provision which is part of the forward looking programme, and the total plan which has not even been presented. The other day we had a statement by the Prime Minister. On other occasions the Prime Minister has casually given off major statements of policy, some out of general government context. On this occasion he said that development and defence would have to go hand in hand and defence would not be allowed to outstrip development. There are three statements on defence made virtually simultaneously, certainly contemporaneously. I do not know whether the Prime Minister's most recent statement is a foretaste of the defence programme analysis which has been made, nor do I know whether the statement in the Budget speech reflected that or whether we are still awaiting a total overall defence policy. We believe that defence is a matter of great importance because of the new world situation - the vacuum which has opened east of Suez and the militarism of Communism which once again has gone on the rampage. President Johnson apparently feels that it could engulf not only Czechoslovakia but also south eastern European countries. The Americans, therefore, have found it prudent to look again at their missile defence system. That surely is a stern enough warning to the world. In those circumstances we say that proper and adequate forward defence planning is of vital importance. The Budget does not make adequate provision for it and we have been left, as we have been left for a long time, to make our own choice of the real defence policies of the Government. We hope that when the projected defence programme comes forward it will provide a defence policy which will be adequate for Australia in its new international strategic position because it is of no use considering, as **Senator Cavanagh** is inclined to do, Australian defence in the context of 1939 or 1914. We are in a completely different strategic area today. We are a nation virtually isolated geographically with new and increasing defence problems. If more money is needed, that is one of the facts of history that we must accept. For that reason we claim that the defence provision is not adequate. Certainly we want more definition of defence. We looked for that in vain in the Budget Speech. We oppose the Opposition's amendment in relation to concern for the urban situation in Australia. While it may be a problem we do not think that on priorities it stands nearly as high or is as demanding or as acute as is the necessity to cast our eyes to the far reaches of the Australian continent and to direct our money, our thinking and our efforts towards the great centres of new industry where we can build up ancillary towns which really can distribute the population of Australia across the continent. Concentration on solving the urban problem will continue to attract urbanisation and finally create problems that no-one will be able to solve unless there is a tremendous commitment of capital. I commend to honourable senators the amendment which has been proposed by the Democratic Labor Party. We think that it alerts the nation to the real demands of this country, the things that really are crying out for attention and rectification. We are concerned that the amendment proposed by the Opposition did not mention such things as the elimination of the means test and the establishment of an independent tribunal to fix social services, a subject to which one honourable senator referred. Neither did it make any adequate assessment of the strategic demands of a defence policy. Instead it referred to that matter almost as an administrative financial1 problem. For those reasons we propound the amendment and trust that it will receive the endorsement of the Senate. {: #subdebate-30-0-s7 .speaker-JZQ} ##### Senator ANDERSON:
Minister for Supply · New South Wales · LP -- I rather regret the circumstances with which we are confronted, with the amendment moved by **Senator Byrne** and the speech he made in support of it, because I recognise, and 1 am sure the Senate recognises, that it was a major speech which contained many matters which I do not accept and I am sure Government senators would not accept. There were matters of great importance across the broad sweep of the Australian economy, Australia's defence programme and Australia's defence objectives which could and should be debated at considerable length. Unfortunately, as the Senate was unable to debate **Senator Byrne's** foreshadowed amendment until **Senator Murphy's** amendment had been debated, we find ourselves in the position of having to debate **Senator Byrne's** amendment at the end of the Budget debate. I think that it would have been better if he could have made his speech in support of his amendment in the main body of the Budget debate. {: .speaker-KKP} ##### Senator Gair: -- The attitude of the Leader of the Government would have been just the same. {: .speaker-JZQ} ##### Senator ANDERSON: -- It might well have been. However, we might have been able to debate the matter more fully. The Government does not accept 'the amendment moved by **Senator Byrne.** {: .speaker-KRU} ##### Senator Little: -- It will ultimately be accepted by the electors. {: .speaker-JZQ} ##### Senator ANDERSON: -- The effect on the electorate is not in our minds at the present time. I am conscious of the fact that time may have beaten **Senator Byrne** in his presentation, but in my opinion he fell down in much the same manner as **Senator Murphy** fell down. Neither speaker quite got down to the substance of the wording of his amendment. 1 do not accept the proposition that the Government could in any circumstances withdraw and redraft the Budget. The die is cast; the Budget has been introduced by the Treasurer in another place. The proposal that the Budget should be withdrawn and redrafted is merely a procedural device. Obviously withdrawal of this Budget would create, all kinds of difficulties and would introduce a slate of confusion into the economy. 1 am sure that the mover of the amendment would not want that to happen. 1 do not believe that the Budget fails to stimulate national development by increasing and developing substantial communities. Concurrently with development in recent years there has been a building up of community centres. Even though 1 am virtually speaking off the cuff on **Senator Byrne's** amendment, certain areas of decentralised development come readily to my mind. For instance, in some parts of Queensland and in Western Australia there have been tremendous population increases. So I find in this part of the amendment very weak grounds on which to move for the withdrawal and redrafting of the Budget. I do not - and I am sure that the Government does not - accept **Senator Byrne's** statement that the implementation of increased social services' by the Government is solely for political reasons. That is fairly strong language to use and I do not think it can be justified. Nor do I believe that an independent tribunal of experts would necessarily solve the problems that **Senator Byrne** has in mind. After all, in the final analysis the Government has to accept the responsibility. It has to shape its Budget across a broad sweep. This brings me to the point that **Senator Byrne** raised in relation to defence. I think that the statement by the Prime Minister **(Mr Gorton)** that defence and development must have a co-relationship is correct. It would be futile to have one's defence involvement completely out of proportion in terms of budgetary expenditure. The situation could almost arise where the law of diminishing returns would apply. It is true that defence expenditure has increased by 9% on the previous year to a figure of SI, 217m and that, when compared with previous budgetary provisions, this is a reasonably large amount. It is also true that the Government is at the present time considering a long term defence programme and that the expenditure for this year will be influenced in the ultimate by whatever long term programme the Commonwealth adopts. I refer now to education. **Senator Byrne** made the point - and I thought that he built up to it quite effectively - that primary education is a matter of concern as it is close to the grass roots. I accept that as a proposition, but I do not think that one can separate the various stages of education - pre-school, kindergarten, primary, secondary and tertiary. Not so long ago the Commonwealth entered into the field of education by providing assistance to the States. This year it is providing something in the order of $210m, not only to State schools but also to the private education sector. This represents an increase of 19% on last year's vote. The provision of financial assistance to the States for higher education must automatically relieve them of a corresponding proportion of the cost and therefore they must be better equipped financially to deal with primary education. I think one has to take education in the broad context when dealing with it. In conclusion, I wish to say that I am sorry that what 1 regard as a major speech by **Senator Byrne** was made in the closing stages of the Budget debate. However, the Government is not prepared to accept the amendment moved by **Senator Byrne.** {: #subdebate-30-0-s8 .speaker-K6R} ##### Senator COHEN:
Victoria -- The Opposition is not prepared to support the amendment moved by **Senator Byrne** on behalf of the Democratic Labor Party. I think that the Opposition's attitude to the Budget was set out quite clearly and succintly in the amendment moved by **Senator Murphy,** which was defeated by the combined votes of the Government parties and the DLP. **Senator Murphy's** amendment should have satisfied **Senator Byrne** and those who support him. I remind the Senate that what the Opposition sought to do was to add to the motion that the Senate take note of the Budget papers the following words: {: type="i" start="1"} 0. . the Senate is of opinion that the Budget is inadequate in that it does not make provision - {: type="a" start="a"} 0. to lighten taxes and health costs for families and to increase benefits; I pause to say that I cannot see anything in that proposition that should cause the DLP to withhold support for it. The amendment continued: {: type="a" start="b"} 0. to plan defence procurement and expenditure; I would have thought that as some of the DLP's amendment was directed to defence members of that party would have supported the Australian Labor Party's criticism of the monumental inadequacies in the Government's approach to defence. The amendment continued: {: type="a" start="c"} 0. to meet the problems of Australia's capital and provincial cities; Why did the DLP withhold support for that amendment? **Senator Byrne's** speech contained, one is bound to say, some highlights and some sentiments with which most honourable senators will agree. In the same way the ALP's amendment contained sentiments with which I would have thought the supporters of the DLP would agree. But what emerged quite clearly from **Senator Byrne's** remarks is that the DLP does not support the emphasis that the ALP has placed on the need to cope with urban problems. This is a problem that has manifested itself all over the world. {: .speaker-KMX} ##### Senator Greenwood: -- What is the problem? {: .speaker-K6R} ##### Senator COHEN: -- The underprivileged, the overcrowding and the traffic problems. Nobody who lives in Melbourne or Sydney ought to ask a question like that because he will get a very direct answer. I am. saying that one can see some difference of emphasis between the Democratic Labor Party amendment and the Australian Labor Party amendment but again one would not have thought that it was so important as to justify voting against an amendment drawing attention to the Budget's failure to meet the problem of Australia's capital and provincial cities. Finally, the fourth leg of the Opposition's amendment stressed the Budget's failure to make provision to obtain control and promote the development of Australia's mineral, fuel, land and marine resources. As a matter of fact, that was somewhat conspicuously missing from the Democratic Labor Party amendment but one would have thought, in principle, it was unexceptionable. The case made by the Opposition against the Budget was a very forthright one. It attacked the Budget frontally and if the DLP had anything to add to that it might perhaps have tried to do it by way of an addendum, a way which was open to it. But the DLP sought to meet the problem by rejecting the Opposition's amendment and by introducing a lengthy amendment of ils own, with some of which, of course, it is impossible for the Opposition to agree. I make it clear that the Australian Labor Party is in basic confrontation with thi". Government on foreign policy generally and especially in relation to the war in Vietnam. If it were possible, the gap between Labor and the DLP is even wider on these issues. I do not want to canvass the situation at length. We have had a debate lasting over a couple of weeks. There has been a lengthy and well considered speech delivered by **Senator Byrne,** at a late stage of the debate, as the Leader of the Government has said. We are not prepared to accept his proposal. We do believe that the emphasis that was placed by the Opposition on this Budget was the correct one - that it failed altogether to measure up to the need to have a national plan in all the great areas in which the people are interested such as development, health and social services. On all these grounds, we believe the Government has not met the challenge ami that this Budget, whatever has been said for it by those who claim it is somehow qualitatively different from previous Budgets is in fact a rose by any other name. It is the Budget that we have had for donkey's years under anti-Labor conservative governments. It is the Budget that we will continue to have, with minor variations - variation? of a very old theme, lt is the Budget that we will continue to have as long as this Government remains on the Treasury bench. Let us all look forward lo the time when this Government is no more and the Treasury bench is occupied by a Labor government which is prepared to protect the interests of alf Australians. {: #subdebate-30-0-s9 .speaker-KKP} ##### Senator GAIR:
Leader of the Australian Democratic Labor Parly · Queensland -- I had not intended to exercise my right to speak in favour of the proposed amendment, but I have been provoked into taking part in the debate by the two most pathetic apologias I have ever listened to, one by the Leader of the Government in the Senate **(Senator Anderson)** and the other by the Deputy Leader of the Opposition **(Senator Cohen)** which were offered as reasons why they cannot accept the amendment that has been submitted by my colleague **Senator Byrne** to the Senate tonight with regard to the Budget which has been under discussion for some days. **Senator Anderson** said that **Senator Byrne's** contribution was a major address. Indeed, it was. It contained material that had not been unearthed by any previous speaker during the course of the debate. Shedding crocodile tears, **Senator Anderson** said that it was a great pity that it came at the end of the debate. What does it matter whether it came at the beginning or the end? Let us deal with it as it is presented, and when it is presented. Let us deal with its contents. **Senator Anderson** went on to say that the die had been cast-- {: .speaker-KPG} ##### Senator Keeffe: -- Half cast. {: .speaker-KKP} ##### Senator GAIR: -- Yes, it has been half cast because the Government has given consideration only to a few of the issues that concern this nation in general and the welfare of a big section of its people has been ignored. **Senator Anderson** said that, the die having been cast, nothing can be done about it. If that, is so, why is the process that we are pursuing tonight provided for in the standing orders relating to the deliberations of the Senate? Why are we continuing in this way if the Senate cannot request the Government to give further consideration to the provisions of the Budget and to have regard to the matter submitted by **Senator Byrne** in his speech tonight? **Senator Anderson** then went on to speak of deficiencies in the speech of **Senator Byrne** in general terms. He said that time did not permit of an examination of or a debate on the many matters submitted by **Senator Byrne** in the course of his address. Does the Leader of the Government need to come here in the dying stages of the debate on the Budget to learn of the pockets of poverty about which **Senator Byrne** spoke tonight when he supported his case with figures resulting from surveys carried out by responsible people in Victoria and Queensland? Did he have to wait until now to learn about that? It is evident from the disregard in the Budget for these pockets of poverty that the members of the present Government are unaware, unmindful of and have little regard for that big section of our people to whom **Senator Byrne** has referred. Then **Senator Anderson** offered feeble excuses as to why other matters contained in **Senator Byrne's** speech could not be accepted by the Government. I repeat what 1 said at the outset. **Senator Anderson** made a pathetic speech in opposition to an oratorical gem containing facts which merit the consideration of every man and woman in this Parliament. {: .speaker-JZU} ##### Senator Ormonde: -- The amendment will not win. {: .speaker-KKP} ##### Senator GAIR: -- I am conscious of the fact that it will not win. There is no greater political realist than I am. But it would win if members of the Australian Labor Party were sincere in their protestations against the Budget. **Senator Cohen** worked himself up into a fever in describing this Budget and in comparing it with all the budgets that have been submitted by this Government. He said it is no different from those that have gone before. {: .speaker-K6R} ##### Senator Cohen: -- Is it? {: .speaker-KKP} ##### Senator GAIR: -- Of course. Did we not move for the withdrawal of a budget before, and did the Opposition not support the Government? That is exactly what **Senator Cohen** is going to do again tonight. It is exactly what every member of his Party is going to do tonight. He is going to support the very Budget which he defamed just a few moments ago. I can understand the Government accepting **Senator Cohen** as a supporter in this instance. I do not begrudge it. Government senators can have him because his attitude on this matter is just one of political hypocrisy. Earlier he defamed the Budget and now he proposes to turn around, gleefully cross the floor of the chamber and help to defeat an amendment which has been moved by the Democratic Labor Party for the withdrawal of the Budget and with the intention of dispensing justice to big sections of our people who are calling out for assistance and humanitarian treatment. {: .speaker-K6R} ##### Senator Cohen: -- Why did the honourable senator not support the ALP. amendment? {: .speaker-KKP} ##### Senator GAIR: -- I can hear all the dogs barking at my caravan, but time will not permit me to pull up and deal with them. I will say what I intend to say. I will not take much longer. They will be glad about that. I. emphasise that these alleged representatives of the poor, the family men, the workers and people who recognise the need for assistance to maintain our dual system of education in Australia, will cross the floor and vote for a Budget that makes no provision at all for those people. Yet they will go out on to the hustings and tel'l the people how solicitous they have been of the welfare of the pensioners, .the widows and the recipients of the maternity allowance, child endowment and all the other forms of assistance that were mentioned in the course of **Senator Byrne's** remarks. However, they will be judged. I leave them to the people. 1 am sure that they wiN be judged rightly when the time comes. {: #subdebate-30-0-s10 .speaker-KBC} ##### Senator WILLESEE:
Western Australia -- I propose to speak only very briefly. Like **Senator Gair,** I had no intention of entering this debate. {: .speaker-JUM} ##### Senator Dittmer: -- The honourable senator had every intention of doing so. {: .speaker-KBC} ##### Senator WILLESEE: -- I .wish **Senator Dittmer** would be more definitive and make clear the honourable senator to whom he is referring'. I find myself in agreement with **Senator Anderson** when he says that this part of the debate should have come at the opening and not in the closing stages. **Senator Gair** has come into the fray and said that we are insincere' and that we do not wish the Budget to be defeated because we do not intend to support the Democratic Labor Party's amendment. It appears to me that there were two ways in which this Budget could have been thrown out. One was by members of the Democratic Labor Party supporting our amendment. Had they done that the Budget would have been defeated. The other is by our supporting the Democratic Labor Party's amendment. **Senator Gair's** charge of insincerity against us comes strangely from him because he fails to look in the mirror and see that his charge must also be laid against himself if there is ; any validity in it. 1 regret very much that the suggestion that **Senator Anderson** has made was not adopted. **Senator Byrne** roamed over a very large area. Frankly, I thought he roamed over too large an area and did not ever make his point as clearly as I know he is capable of making it. For instance, because of the great importance of defence, with which the Budget speech deals in only a few short sentences in the opening paragraphs, this debate could well have revolved around that question. The only reason why it did not is that an important defence statement has been promised by the Prime Minister **(Mr Gorton)** before the end of this session. That statement could well be made on the eve of an election, which would give it so much more urgency and so much more reason to be debated. I understood **Senator Byrne** to say that the DLP wanted to see a forward system of defence. But then he chided **Senator Cavanagh** for being back in the Maginot Line thinking, or the 1914 or 1939 thinking. 1 do not quite follow that. I would like to have heard **Senator Byrne** further on it. I would also like to have heard other members of the DLP on it. It seems to me that **Senator Byrne** accused **Senator Cavanagh** of falling into the very' error into which he himself fell. Putting one's fixed line of defence a long way away from one's home base seems to me to be the policy that was behind the Maginot Line. 1 believe that **Senator Anderson** put his finger on the point when he said that if an amendment was to be moved **Senator Byrne's** speech was the type of speech that the Senate should have had an opportunity to debate. I know that theoretically we could start the debate all over again: we could debate this amendment and go on and on. But that is not the right approach to make, in terms of practical politics. I cannot follow **Senator Gair** when he says that we are insincere and that we do not want the Budget to be defeated, yet exonerates himself for not supporting the Opposition's amendment and voting against the Government. For that reason. 1 support what **Senator Cohen** has said, and I will vote against the amendment moved by **Senator Byrne.** Question put - >That the words proposed to be added **(Senator Byrne's amendment)** be added. The Senate divided. (The President - Senator Sir Alister McMullin) AYES: 3 NOES: 41 Majority . . . . 38 AYES NOES Question so resolved in the negative. Original question resolved in the affirmative. {: .page-start } page 653 {:#debate-31} ### QUESTION {:#subdebate-31-0} #### PROPOSED EXPENDITURE 1968-69 Motion (by **Senator Anderson)** agreed to: >That the Senate resolve itself forthwith into a Committee of the Whole for the purpose of considering the Particulars of Proposed Expenditure for the Service of the year ending 30 June 1969, and the Particulars of Proposed Provision for Certain Expenditure in respect of the year ending 30 June 1969. In Committee Motion (by **Senator Anderson)** agreed to: >That, unless otherwise ordered, the Divisions of proposed expenditure be considered in the following order:
Minister for Supply · New South Wales · LP -- by leave - Before we proceed with this Committee debate, ] would like to explain to honourable senators the various changes that have been made this year in the form of the particulars of proposed expenditure documents. They are as follows: First of all, the separate Part 2, Business Undertakings, has been eliminated. Honourable senators will recall the progress that has been made in recent years in removing these special sections. For example, last year the separate 'Territories' section wits eliminated. Previously the 'Miscellaneous Services' section and the War and Repatriation Services' section were eliminated and brought within the appropriations of the controlling departments. The main reason for this action was that these sections never really succeeded in their purpose of showing the Commonwealth's total expenditure in the designated areas. This year there was the added reason that the changes in the financial arrangements for the Post Office, that is the creation of a Post Office trust account and a one-line appropriation in Appropriation Bill (No. 2), left few items in Part 2. These remaining appropriations are now shown under the relevant departments and can readily be identified. The new layout should be more convenient for honourable senators both in general reference and in the debates. The second change is the removal of the schedule of salaries and allowances from the particulars of proposed expenditure and its appearance, in improved form, as table 16 in the document 'Estimate of Receipts and Summary of Estimated Expenditure'. The old schedule had several weaknesses. It showed created positions, whether occupied or not, and it gave no details whatever of temporary staff. The new table shows numbers of permanent and temporary staff actuallyemployed both for the previous financial year and the estimated numbers for the coming financial year within the approved establishment at 1st July. In addition, the table shows how the staff is distributed among the major functional groups of each department, lt is hoped that' the information now provided will be of considerably more interest and value to the Parliament, the Press and the public. In particulars of proposed expenditure the salaries of both permanent officers and temporary employees are included in the one appropriation item, thus allowing departments more flexibility where the ratio of permanent officers to temporary employees varies from the estimate. The salary of each First Division officer has been appropriated separately to give effect to section 30 (!) of the Public Service Act which provides that officers of the First Division shall be paid such salaries as the Parliament provides. The third change is the consolidation of the appropriations for the running costs of our posts overseas into one division in each of the Departments of External Affairs, Trade and Industry and Immigration. The previous practice was to have one division for every post; and where two or three departments were represented at a post, there were two or three divisions. The rapid growth in the number of overseas posts led to a proliferation of appropriations, many of very small amounts, and also led to certain administrative difficulties. It was accordingly decided to consolidate the appropriations in the manner I have indicated. In order that Parliament should continue to be provided with detailed information about oar overseas posts, the following action has been taken: (a) The running costs of each post, dissected into salaries and administrative expenses, are set out in tables 9, 10 and 15 in the document 'Estimates of Receipts and Summary of Estimated Expenditure'; (b) details of staff employed at each post are shown under the relevant departments in table 16 - Salaries and Allowances - of that document. This table shows, for the first time, the number of locally engaged staff, as well as the number of Australian based staff, at each post; (c) details of capital1 works and services are shown in the usual way. There is a separate item for each individual post where the amount is significant. At this stage I should like to mention that the three changes to which I have referred have been discussed with the Joint Committee of Public Accounts. Indeed, the Committee may take credit for initiating certain of the improvements to the table of salaries and allowances. This year for the first time there will1 be one-line appropriations for the Commonwealth Scientific and Industrial Research Organisation and the Post Office. This follows major accounting changes for these two organisations which have already been approved by the Parliament. In the case of the CSIRO details of expenditure estimates are given in table 8 of the document Estimates of Receipts and Summary of Estimated Expenditure'. In the case of the Post Office details of plans and prospects are set out in the White Paper entitled 'Post Office Prospects and Capital Programme 1968-69'' and details of transactions in 1967-68 will be shown in the annual report. The final change relates to the financing of the Loan Consolidation and Investment Reserve. This year provision is being made for the payment to the Reserve of such sums as the Treasurer determines. The history of this matter is as follows: The Reserve was established in 1955 and for the first 2 years of its existence payments were made to it by means of an appropriation in the same manner as will be done this year, that is, of such sums as the Treasurer determines. In its 34th report the Joint Committee of Public Accounts suggested that these open ended appropriations should be discontinued and that they should be replaced by specific appropriations in the annual appropriation Acts. This suggestion was adopted by the Government and each Budget from 1957-58 to 1967-68 contained a specific appropriation for payments to the Loan Consolidation and Investment Reserve. In practice, this procedure did not work out at all satisfactorily. In order for it to have been satisfactory it would have been necessary to estimate with a reasonable degree of accuracy and confidence the amount required to be transferred to the Reserve and to make provision accordingly. Even at the time of the additional estimates, however, this has not been found to be possible. This arises from the fact that the payment to the Reserve is a residual balancing item and therefore reflects all other variations from the estimated receipts and expenditure of the Consolidated Revenue Fund - not the least of which can be in the amount of defence expenditure charged to the Loan Fund under the authority of a Loan Act passed during a financial year. In order to secure an adequate margin of safety it has therefore been necessary to seek authority for payments which, at the time of the additional estimates, are considerably in excess of those which appear to be required to cover the then estimated Consolidated Revenue 'Fund surplus for the year. This procedure still left open the possibility that the Consolidated Revenue Fund surplus might exceed the upper limit specified. It is also relevant that the payment from Consolidated Revenue Fund to the Loan Consolidation and Investment Reserve is a purely internal machinery transaction which involves no final expenditure by the Commonwealth. The use of funds in the Reserve is governed by specific legislation passed by Parliament. In the light of these circumstances, it was considered that there would be advantages in reverting to the procedure of seeking open ended appropriations for the transfer of funds from the Consolidated Revenue Fund to the Loan Consolidation and Investment Reserve, lt was felt that: the procedure of appropriating specific amounts had been given a very fair trial and that it had been found to be unsatisfactory. The Joint Committee of Public Accounts has been given prior notice of this change. {: #subdebate-31-0-s1 .speaker-KBL} ##### The TEMPORARY CHAIRMAN (Senator Wood:
QUEENSLAND -- As there is a number of new senators I think I should point out that the purpose of this debate is to go through the Estimates in detail. An opportunity is given to each honourable senator to ask questions relating to items in the Estimates. Honourable senators may question, for example, the size of an appropriation for a particular item or ask the reasons why items are included in the Estimates. In short, honourable senators are given an opportunity thoroughly to examine the proposed expenditures for this financial year. It is not desirable that each honourable senator should take a quarter of an hour - the period allowed - to ask his questions. Honourable senators may take more than one opportunity to ask . questions if they are interested in more than one item. Department of Supply Proposed Expenditure, $95,002,300 **Senator ORMONDE** (New South Wales) 9. 14] - 1 wish to refer to several items, but not necessarily in their order of importance. The first item to which 1 wish to refer relates to disposals expenses in Division 720 - Administrative. I also queried this item last year. In my amateur way I thought that this item might have something to do with the selling of government materials through disposals stores. I may be quite wrong, but that is my impression. If 1 am correct, 1 want to know whether the Government supports the activities of these disposals stores which create the impression that they receive supplies from the Government for sale at about half price. An inspection of the stores shows that- that impression is not correct. Although they may have some government supplies for sale, they are usually stocked with other goods. The general public may have the impression that such stores sell only government materials. 1 would like an explanation of the position. I turn now to the appropriation of $58,000 for advertising, also in Division 720 - Administrative. I want to know whether it is classified advertising. If it relates to display advertising 1 wish to know who handled it and-- the amounts involved. I want to know the name of the agency that has the account for this type of advertising. I. turn' now to Division 722 - Government Factories, in which provision of $4,138,000 is made for reserve capacity maintenance. 1 want to' know what that means. The other day in this chamber I asked a question about reserve capacity buildings. I remind the Minister that many employers are concerned that the Government is over-supplied with manufacturing buildings. I have seen correspondence in which it is claimed that the employees ot those establishments are employed for only half the time, and are working at half pressure. I examined a letter written by an association of steel makers in which it was said that the association would seek guarantees that competition between government factories and private factories would cease, and that a ceiling would be placed on the expansion of defence factories. This year's Budget provides for an increase of $1,682,000. to $10,024,000 in the amount allocated for the purchase of new machinery and plant for government defence factories. The point the employers make is that the Commonwealth is over-supplied now with defence factories and they want a new arrangement. I deal next with Division 724 which provides for $2,125,000 for storage services. I should like the Minister to tell me where this storage takes place, what is stored and whether this is rent paid by the Government to private owners of stores. I presume that that is the case; the Government would not be paying rent for storage capacity in its own premises or in its own workshops. 1 refer next to the Antarctic Division which comes under Division 727. For many years in the debate on the Estimates I have asked why the Government still pays rent for ships which ply between Australia and the Antarctic. 1 should have thought that by this time the defence and scientific situations would have been such that the Government would at last have decided to build its own ships, I have heard this subject mentioned quite a few times in this place and within the last couple of days the Minister replied to a question from **Senator Laught** on the subject of ships which travel between Australia and the Antarctic. Although this item has been in the Estimates for years, the Government is still paying an annual rental of $665,300 for the hire of the 'Magga Dan' and 'Thala Dan'. That is a lot of money to be paying out each year, yet my recollection is that the Government has been paying this amount annually over the last 10 years, lt could have bought half a dozen ships for the amount that it has paid to hire these vessels. At one time the Government might have been able to say that in Australia we did not have the expertise to build icebreakers or ships of a type that could operate in the Antarctic, but I do not think that could be said today because our shipyards are right up to date. I would like the Minister to tell the Senate- {: #subdebate-31-0-s2 .speaker-JZU} ##### Senator ORMONDE: -- Yes, that it will nol happen again. T thank the honourable senator for prompting me. I should like the Minister to say also that the Govern ment is making arrangements for us to have our own ships. I refer next to what is termed 'recoverable expenditure' under Division 743. I find this a difficult term to understand. I do not know what it means and I do not suppose that any other senator knows what it means, but it is an expression that has been used in the Estimates for years. Will the Minister explain that to me? I should like information also on the acquisition of sites and buildings which comes under Division 745. No doubt these are for public works and I presume that this item of expenditure includes the amount spent on the building of the Lobby restaurant near Parliament House. {: .speaker-K1F} ##### Senator Poyser: -- The pie shop? {: .speaker-JZU} ##### Senator ORMONDE: -- Yes, if that is what it is. On several occasions in this place I have talked about the need for a restaurant close to Parliament House so that members of the public could purchase a cup of tea. I had in mind a humble sort of place where people could get a cup of tea for perhaps 30c or 40c. As many as 750,000 people visit Canberra every year, but there is nowhere near to Parliament House where they can get a cup of tea. {: .speaker-JUM} ##### Senator Dittmer: -- Would the honourable senator not take his guests to the dining room? {: .speaker-JZU} ##### Senator ORMONDE: -- Not all visitors have access to the dining room; it is only those who are lucky enough to have politician friends who are not too mean to take their friends to lunch. {: .speaker-JZQ} ##### Senator Anderson: -- If I may interrupt the honourable senator, this matter does notcome within the allocation for which I am responsible, so perhaps the honourable senator would direct his question to some other Minister. {: .speaker-JZU} ##### Senator ORMONDE: -- The Lobby is not what I had intended when I suggested that a restaurant should be built, but I shall raise the matter again at a later stage. {: #subdebate-31-0-s3 .speaker-KQQ} ##### Senator LAUGHT:
South Australia -- I desire to speak to Division 727 which relates to Antarctica. I compliment **Senator Ormonde** on the idea he has put forward in questioning the Minister on why Australia does not own the ships that it uses for journeys to and from the Antarctic. From time to time I have taken exception to the large amount of money that is spent each year on the hire of. ships. Item 04 in subdivision 2 of Division 727 is described as 'Hire of ships and aircraft'. T should like the Minister to separate the two parts of that item. How much is for the hire of ships and how much is for aircraft? What is the nature of the aircraft hired by the Antarctic Division? In the United Kingdom 1 understand that the Royal Navy has a section devoted to work in the Arctic. 1 understand also that there is a famous section of the Royal Navy that deals with Arctic exploration and movements to and from British parties in the Arctic region. 1 submit to the Minister that he could well discuss with his colleague, the Minister for the Navy **(Mr Kelly),** the question whether or not. it would be possible to have a ship, if necessary owned by the Department of Supply, manned by Royal Australian Navy personnel to go to Antarctica, this very important part of Australian territory. 1. think great advantage could come to Australia by having naval personnel trained in the special technique of navigating and weathering in Antarctic waters. I feel that the hiring of ships gets us nowhere. We pay about $600,000 each year to Denmark, which 1 understand is the country of origin of these ships. We have no trained personnel because, I understand, Danish sailors man these ships. We get nothing of benefit for Australia by hiring the ships from Denmark. 1 realise that a ship could cost Sim or more, but if we owned one we could have it for 12 months of the year. ] understand that at present the ships that we hire make trips out from Europe for the purpose. They are in Europe during the Australian winter and in Australian territorial waters during the summer. I believe that if we owned our own ship we could use it for oceanographic work and we could be training scientists during our winter months in the waters nearer to Australia. I should like the Minister to have a look at this proposition. At last we have in the Senate a Minister charged with the responsibility for Antarctica. About 6 months ago and from time to time 1 have raised with the Minister the question of whether the headquarters of the Antarctic Division should Be brought to South Australia, because the Department of Supply has a very gne institution at the Weapons Research Establishment at Salis bury, near Adelaide. The grade of electronics and meteorological work done there is possibly the highest in Australia. This establishment works in conjunction with the one al Woomera. I cannot think of a more filling place than Salisbury for the headquarters of this Division. I ask the Minister whether he has given any thought to where it should be. 1 put it to him again thai he should not go beyond Salisbury for this purpose. I take it from the estimates that a very large amount is not expendable in the normal way for clerical salaries and I therefore suggest that the movement of many personnel would not be required from wherever they are at the moment to South Australia. The scientific atmosphere at Salisbury could be of great benefit to the Department. In relation to Division No. 729. 1 direct the Minister's attention to the fact that a number of scientists from Salisbury and no doubt some at Woomera are a little afraid as to their future employment and of the development of their talents in the atmosphere of the Weapons Research Establishment, because of the general public uncertainty in relation to the future work programme. I should like the Minister to explain what will be the future of the Establishment and of the projects in hand at Woomera. I understand that wilh the involvement of European countries and the European Launcher Development Organisation it is not very easy for the Minister to keep the public informed, but as he has come to us to have his estimates for the coming year approved, I think he owes it to honourable senators to make as full a statement as he can on the work programme at Woomera and Salisbury. The Australian public is entitled to it - in particular a number of young scientists who have given a good deal of their adult life to this work. Some have been trained at university at the expense of the Department of Supply and they are constituents of mine. T compliment the Minister on the work of his Department in South Australia, its importance to the State, and the splendid morale that has developed at Woomera, 400 or 500 miles from Adelaide. The Department makes a great contribution to the outback life of South Australia. Graziers, station managers and their employees living in the area beyond Port Augusta get great encouragement from the excellence of the civic structure at Woomera. This is of very great importance to the State. {: #subdebate-31-0-s4 .speaker-JZQ} ##### Senator ANDERSON:
Minister for Supply · New South Wales · LP -- **Senator Ormonde** rattled off about half a dozen queries. **Senator Laught** has raised two matters, one of which had been referred to already by **Senator Ormonde.** Rather than lel them get completely away from me, J shall try to deal with these inquiries as we proceed. Both honourable senators referred to Division No. 727, which relates to the Antarctic Division. I think the real substance of their submission was: Why pay rent for ships? The proposed vote of $656,300 covers also the hire of aircraft, for which an amount of §85,000 is proposed. **Senator Laught** asked about types of aircraft. Two types are currently under consideration for hire but a decision has not yet been made as to the type to be used. I feci bound to remind honourable senators that the administration of the Antarctic Division came within my portfolio only on 1st May. There is currently going on in my Department a review of the Division. The hire or purchase of ships is one of the subjects to have consideration. {: type="A" start="I"} 0. have a responsibility to the Government in relation to all of these matters. It will be recalled that I issued a Press statement a tew days ago in relation to the reopening of the Davis station, and I made reference 10 Wilkes. Many related matters have to be sorted out. As I said in answer to a question several days ago, the matter is not easy because of the isolation of Antarctica. Considerable study by senior officers of my Department and of other departments will be needed before I am in a position to give conclusive answers lo some of the questions raised. **Senator Laught** suggested transferring the headquarters of the Division to South Australia. I think the basis of his argument is that al the Weapons Research Establishment at Salisbury we have experts in this field and in other scientific fields and it would be the natural place for it. The present activities of the Antarctic Division are currently related to logistics and the present scientific strength of the Division is quite small. Possibly in the future we may see some increase in the number of scientific staff. The technical capacity of the Weapons Research Establishment will be used to the greatest extent possible, but il is too early to consider the fundamental question of where the headquarters should be. After all, it must bc borne in mind that the Department of Supply Central Office has moved to Canberra only in recent years. Although we have Supply organisations all over Australia it is from Canberra that the central administration stems. The question arises whether there is need to have a link here or in another area. Next I turn to the matters raised by **Senator Ormonde.** Although he is not in the chamber al present my replies will be in the Hansard record tomorrow for him to read. He referred to Division 720 - Administrative. 1 inform him that item 07 relates to al'l advertising, except disposals, principally in connection with contract tenders and staff vacancies. Classification and display is done through the sub-Treasury, Sydney. There is a reference to Gordon and Gotch Ltd and to Henry Berry and Co. Ltd. They are the agents employed in that reference. The honourable senator asked me about the allocation of $166,000 this year for disposal expenses. These expenses cover such things as advertising, auctioneers expenses and commission and charges to be borne by the Commonwealth in connection with the disposal of surplus stores. This Department is the disposal authority for all stores declared for disposal by Commonwealth departments. He raised a matter under Division 722 in relation to reserve capacity. The purpose of this provision is to meet overhead costs in Government factories attributable to reserve capacity retained for an emergency. Service work is charged at normal overhead rates. This provision is designed also to provide for the rearrangement of production facilities, the costs of which are not properly chargeable to current work, and to meet other non-recoverable factory costs. There is an allocation of $4m for reserve capacity maintenance. This is to provide for the cost at factories of maintaining considerable quantities of plant which are not being used currently for production purposes, and the maintenance of closed factories. This is a classic answer in relation to reserve capacity. I am sure all honourable senators will realise that defence establishments must be maintained. 1 think probably the biggest problem that I, as Minister, and my senior officers have to face is that of keeping an establishment for our own defence purposes in which we do not have capacity. Therefore although we have plant, equipment and the like standing idle it must be maintained and preserved. This costs money. That is a simple explanation of reserve capacity. In addition, the provision is designed to meet fixed overheads necessary to maintain production capacity which cannot reasonably be regarded as production costs at the current level of production. There is a further explanation in relation to it but I think that captures the concept of the problem of reserve capacity. A question was raised in relation to Division 724 - Storage Services - and to the item dealing with rent paid to private stores. The Department of Supply is responsible for providing storage facilities for the Commonwealth. Storehouses are located in all States and the Australian Capital Territory for the purpose of storing goods as required by the Department of Supply and, to the extent of capacity available, by other Commonwealth departments. This provision covers wages and so on for storeroom employees, electric light, power, telephones, salaries, allowances and administrative expenses. That is- a fairly- straightforward matter. Division 743 - Other Administrations - was mentioned. In previous years this vote provided for transactions related to work performed for. other administrations such as the United States National Aeronautics and Space Administration and the European Launcher Development Organisation, known as ELDO. Effective from 1st July 1968 the vote has been eliminated with transaction; to be financed as follows: Firstly, specific projects which are advance funded by other governments and international bodies will be handled through a newly created self-financing head of trust fund. Secondly, orders from other governments for the supply of rifles, ammunition, service stores and so on will be handled through the Munitions Production Trust Account. I come now to the question posed by **Senator Laught** relating to the concern that may well be expressed at Salisbury on the influence that Woomera may have on Salis bury and the possibility of future employment. **Senator Bishop** asked me a question about this the other day. At the time I felt that I answered it as fully as 1 could in the circumstances. As honourable senators know, there is a joint agreement between the United Kingdom Government and Australia in relation to the administration of the Woomera rocket range. Under a new agreement Salisbury progressively will be separated from the agreement and during the life of the current agreement will return to the ownership of the Australian Government. But there is the situation that at Woomera one of the very big projects is the ELDO programme. The Organisation is a group of European nations. Australia is a constituent member of the Organisation by virtue of the fact that we provide the facilities. There is to be a meeting in Paris on 1st and 2nd October at which the member states will discuss the future work programme of ELDO. Problems are emerging because of the intrusion of added costs involved in carrying out the launching at Woomera. For those reasons the information I gave **Senator Bishop** still holds. I think we need to wait until after the conference in Paris at which the problems related to the future ELDO programme have been sorted out before I make a comprehensive statement about the future situation as it may emerge, particularly at Woomera and, to an extent, because of the work load at Salisbury which the scientists are feeding into Woomera. In the circumstances 1 do not want to go any further than I have gone. This is an important matter because honourable senators will appreciate that any turn down or turn back in the ELDO programme would have quite a significant implication for the joint agreement between the United Kingdom Government and Australia. After all, ELDO is one of our best customers. This matter has quite serious implications. I do not want to be pessimistic about it beyond saying that as soon as it is possible for me so to do, I will outline the full facts to the Senate. {: #subdebate-31-0-s5 .speaker-KTA} ##### Senator MCCLELLAND:
New South Wales -- I wish to raise certain matters concerning the estimates for the Department of Supply. I refer to Division No. 720 - Administrative. I notice that in the preamble to the annual report of the Department of Supply it is staled that, with about 220,000 employees, the Department of Supply is one of the largest Commonwealth departments. At page 5 of that report, in the introductory remarks, mention ;.s made of the fact that the first stage of th ' transfer of the Department's Central Office from Melbourne to Canberra was completed in January 1368, that the second stage is expected to be completed by January 1969, and that the transfer is taking place with minimum of difficulties. One would therefore assume that the bulk of the- employees in the administrative section of the Department of Supply are being transferred from Melbourne to Canberra, but if one peruses page 157 of the 'Estimates of Receipts and Summary of Estimated Expenditure' under the heading 'Functional Summary' one will see that there is a decrease this financial year in the number of regional officers in every State except Victoria. I would like to know. how this squares up wilh the statement in the annual report that the first stage of the transfer of the Department 0: Supply from Melbourne to Canberra was completed in January 1968 and that the second stage is expected to be completed by January 1969. In the last financial year there were 68r> regional officers in Victoria but this year it is .estimated that there will be 724. That i:> an increase of forty-one. In each of the other States there has been a diminution in the average number of employees. Bearing in mind the functional summary set out in these estimates and the categorical statement made in the annual report of the Department, one wonders what the rea situation is. I would like some guidance from the Minister for Supply **(Senator Anderson)** or, through the Minister, from the departmental advisers as to whether the establishment of the Department is being expanded in Victoria and whether the transfer from Melbourne to Canberra announced in the Department's annual report is in fact taking place. I refer now to Division 720, sub-division 2, item 04, which covers freight, cartage and packing. Last financial year expenditure was about $84,000 but this financial year there is an increase to $109,000. Whilst the amount in itself is not great, it represents an increase of 20% and 1 think this is worthy of explanation by the Minister. In the same sub-division, item 10 covers inci dental and other expenditure. This is to increase from over $152,000 to $210,000. While this increase may be regarded as being of a minor nature when compared to the overall estimate for the Department of Supply, of S41m, 1 think it requires some explanation. After all there are twentysix Government departments and if incidental and other expenditure were to increase in all of them by this amount it would add up to a substantial sum. The Australian taxpayer is entitled to an explanation of what is covered by the broad heading "Incidental and other expenditure'. My other remarks relate to reserve capacity maintenance in government factories. There is quite a large increase in the amount of money to be expended under this item. Whereas there was an expenditure of S2.883m last year the estimate for this year is $4. 138m. In other words, in this one item of the estimates of the Department of Supply, there is an estimated increase of roughly 70% or 75%. Surely such an increase warrants an explanation by the Minister. I remind the Minister that last financial year when the former Leader of the Government in the Senate, **Senator Henty,** was the Minister for Supply, .1 drew his attention to the fact that I had received answers to questions on notice concerning the supply of ammunition for Mirage aircraft. I pointed out that the expenditure incurred by the Department of Air for the purchase of ammunition for these aircraft was not incurred with the Department of Supply but with firms in the Republic of France. The then Minister's reply to me appears al page 1014 of Hansard of 28th September 1967. Ha said: {: .speaker-KTA} ##### Senator McClelland: asked whether the Department was geared to supply the ammunition needs of the Services. The Department is capable of producing the majority- 1 emphasise the words '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 lo the purchase, of 30"millimetre ammunition. The setting 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. That was 12 months ago. Since that time, very little, if anything, has been said by the Department of Supply or by . the Government as to what .arrangements have been made by the Australian. Government to provide for the production of 30 millimetre ammunition in Australia by the Department of Supply or by civilian producers operating under sub-contract to the Department of Supply for the supply of ammunition to Australian Mirage fighters. I think at this stage, bearing in mind the defence expenditure that is involved under these estimates by the present Government, and the importance of the supply of ammunition to Australian forces, particularly the Royal Australian Air Force, the Government should be in a position to say what arrangements have been made by the Government with the Republic of France to see that a licence is given to the Australian authorities to manufacture 30 millimetre ammunition for the Mirage aircraft in Australia. I submit to the Minister that these matters are of importance not only to his own Department but also to the Minister whom regard as a very sincere Minister of the Government. Because of the heavy defence expenditure involved under these estimates, and because, subsequent to the matters I am now raising, I might wish to raise other questions regarding the supply of ammunition to the Australian armed forces, I believe the whole question of the production of 30 millimetre ammunition for Mirage fighters in Australia is of vital importance to this nation and certainly, in addition to the other matters that 1 raised *Ip* the early stages, deserves attention by the Minister and an explanation to this Parliament. {: #subdebate-31-0-s6 .speaker-KPG} ##### Senator KEEFFE:
Queensland -- I want to touch on a number of things. I refer first to item 03 of Division No. 720 which relates to the salary of the Secretary of the Department, the appropriation for which is underspent by $48 this year. Before proceeding with that matter, 1 want to make a couple of general remarks. Last year, we did not receive the Department's annual report until after the estimates had been debated. Last year, too, some qf us complained about the lack of detail. There has been an improvement this year in that the colour photography is much better. I want to criticise the Minister, too, for producing his last statement only just before we began this debate this evening. 1 notice there has been a number of inquiries, particularly with regard to the petty cash account. {: .speaker-JZQ} ##### Senator Anderson: -- Are you referring to the statement 1 made on behalf of the Treasurer? {: .speaker-KPG} ##### Senator KEEFFE: -- I am referring to the statement you made this evening. Had it been made a day or two earlier, we would have found it much easier to examine the estimates. It is impossible to do that properly or to absorb what is contained in the statement in the short time we have had this evening. Therefore, the statement is virtually valueless. I offer that word of criticism because I think we could have been helped a little in this direction. I wish to seek information- on a number of points, but I do not want to confuse the Minister. If I do not take the whole of my time now, I shall use up the balance later and this will enable the Minister to obtain information for me in the meantime. {: #subdebate-31-0-s7 .speaker-K3J} ##### The TEMPORARY CHAIRMAN (Senator Bull:
NEW SOUTH WALES -- Would the honourable senator name the particular division to which he wishes to refer? {: .speaker-KPG} ##### Senator KEEFFE: -- I shall name them as I come to them. Again I am being critical, but I do hope that on this occasion we shall be able to get the information we seek. Last year during the debate on these estimates 1 referred to a fairly large number of points about which T felt we ought to have additional information. 1 regret to have to. say that information was supplied with relation to only about one-third of the points 1 raised. The other matters were either glossed over or forgotten about or deferred until the whole of the time allowed for the debate had expired. On this occasion, in order to make it easier for the Minister, I shall tabulate at the end of each of my contributions during this debate the things about which I seek information. If the information is not forthcoming, I shall certainly put questions on the notice paper in an attempt to get it. I hope 1 do not have to do what a member of one of the Government parties in another place did yesterday. He put 114 questions on notice. 1 refer now to item 02 of Division No. 722. It relates to re-arrangements of capital facilities. Hansard of last year records that I was seeking certain information regarding the purchase of some land at Coburg in Victoria. Reference is made to this subject on page 295 of the Auditor-General's report, lt reads: >Acquisition of Sites and Buildings - The reduction of 5335,460 reflects the expenditure in 1966-67 on the acquisition of a site for a new Commonwealth Clothing Factory nt Coburg, Victoria. The Minister might recall that when this point was raised last year I was given certain information by the then Minister bin, a couple of days later, he admitted he was in error. The information he had given was entirely different from what he gave on the later occasion. For instance, the area of land mentioned by the Minister on the first occasion as being the area involved in the transaction was only about onequarter of the total area of land that was ultimately purchased. I also asked at that time how much in excess of the actual valuation of the land was paid for the site and who were the people who transacted the sale. Some of this information was made available hu! - I believe quite deliberately - some information was never forthcoming. {: .speaker-K69} ##### Senator Sim: -- Can von prove it was deliberate? {: .speaker-KPG} ##### Senator KEEFFE: -- I do not know whether it was deliberate or not. {: .speaker-K69} ##### Senator Sim: -- Then why say it was if you cannot prove it? {: .speaker-KPG} ##### Senator KEEFFE: -- 1 think it is a fairly useless state of affairs if 1 ask for information and it is not made available. Failure to supply information may be due to one of two circumstances. Either there is something to be hidden or the Minister is totally inefficient and does not know what he is doing. The honourable senator is just as inefficient when he asks such a stupid question. Let me come back to the point under discussion. I hope the Minister is able to supply information to clarify the matter on this occasion because it is important that he do so. A doubt was left in my mind. Undoubtedly it would not be left in **Senator Sim's** mind because there is little of it there. But there was a doubt left in my mind and in the minds of many people in this chamber. As the matter received some publicity in the Press it is obvious that there is some doubt in the minds of certain members of the public also. I hope that this year we will finally clean it up and will not quibble about whether anything has to be suppressed. 1 hope that that will not be the case at all. I hope that we will be told the true price that was paid for the land and true valuation of it and that we will not have to go around looking at records in lands departments and so on to obtain information. {: .speaker-JUM} ##### Senator Dittmer: -- What about the market price? {: .speaker-KPG} ##### Senator KEEFFE: -- As my colleague says, there is a third price, namely, the market price, lt could be in excess of the valuation. If I may do so under the same heading, I will refer to another statement in the Auditor-General's Report. Under the heading 'Central Transport Authority - Vehicles and Equipment', it states: >An increase in the number of vehicles purchased during the year as additions to and replacements for the transport fleet resulted in increased expenditure of $404,599. Nowhere is the total car fleet shown. I am not saying this in a critical way. I believe that more detail should be available. There is no problem if anyone wants to find out how many vehicles are in a particular branch fleet. I believe that this information would be helpful to the public. {: .speaker-JZQ} ##### Senator Anderson: -- The honourable senator has quoted from the Auditor-General's Report, but will he link that to an item in the Estimates? {: .speaker-KPG} ##### Senator KEEFFE: -- 1 think this matter would come under the item 'Rearrangement of capital facilities'. If not, I will defer my remarks until the appropriate item is before us. I am prepared to accept guidance. {: .speaker-JZQ} ##### Senator Anderson: -- I understand that the matter comes under Division No. 734. {: .speaker-KPG} ##### Senator KEEFFE: -- I will use that division as my reference. I do not want to' deal with the matter under the wrong heading. If Division No. 734 - Central Transport Authority - Vehicles and Equipment - is the more appropriate division, 1 am happy to adjust my reference. 1 thank the Minister for his guidance. The overall changes in expenditure are not great. They are set out fairly clearly in the Auditor-General's Report. Can we have a listing of the number of vehicles, types of vehicles and makes of vehicles on which the additional money has been spent? I also believe that if we had some idea of the total number of vehicles in all the pools in Australia that would be helpful. 1 am not seeking this information with any unreasonable motive. I believe that it would be handy for us to have it. I think the other matter that 1 want to raise would come under the same heading. On page 295 of the Auditor-General's Report, under the heading 'Central Transport and Storage Authority', a fairly large sum is mentioned. It states: >Thi' increase of $1,714,398 comprised additional expenditure of $714,398 on furniture removals and storage and the payment of compensation to Commonwealth officers and service personnel following a fire in a contractor's furniture storehouse in Queanbeyan, New South Wales, and an amount of $lm was paid to the Supply Storage and Transport Trust Account as additional working capital. How much money was spent by the Department to cover the loss of furniture and personal effects in the contractor's furniture storehouse in Queanbeyan? Why did any compensation at all have to be paid from the funds of the Department? lt seems to mc that, if the Department is using private facilities, including private storage space, for the storage of furniture in connection wilh the carriage of furniture and effects on its behalf, the furniture and effects should be adequately covered by insurance and this compensation should never have to be paid out of the financial resources of the Department of Supply. If there is a logical explanation for the payment of this compensation, I will be very happy to hear it. But if private contractors are used it should not be the Government's money that is at risk; the' contractor should have a fire insurance or damage insurance policy, as the case may be. From my reading of the Auditor-General's Report, it would appear thai no insurance policy at all was in operation. I refer now to Division No. 724 - Storage Services. Could we have more detail of the expenditure ' under that division? A very large sum of money is involved. Last year the appropriation was underspent by a minor amount. This year the appropriation is smaller, to the extent of about $100,000, than it was last year. I would like to know what the storage areas are used for. ls all of this money paid to private contractors? Is this part of the general setup of the Department. Had we had the explanatory notes yesterday or the day before, it might have been easier for us to follow some of those matters. There are another ten or so matters on which I wish to seek information. But I will not confuse the issue at the moment. I will refer to them as the debate proceeds. {: #subdebate-31-0-s8 .speaker-K1Y} ##### Senator BISHOP:
South Australia -- I wish to refer to the subject thai the Minister mentioned in replying to **Senator Laught.** However, I am not raising exactly the same question as he and I raised on the .matter of employment. My remarks will be concentrated on Division No. 729. Defence Research and Development Establishments, and Division No. 722, Government Factories. I know that in a broadcast in May the Minister stated that the Weapons Research Establishment would be reoriented to some extent in the future. He said: >Firstly, it is the' aim of the Australian Government to reorganise the scientific and technical organisation at the Weapons Research Establishment to enable us to deploy valuable technological resources to important tasks for the Australian Services. We see from the report on the activities of the Department of Supply that in the field of electronics, not only in research but also in manufacture, there is a growing competence to do most of the things which at present are being done in outside industry.lt occurs to me that there is a matter of policy that might be changed. The Department has been and is attempting to encourage the production of micro-electronic equipment in outside industry. Only a few days ago the Department let to private contractors an important contract for Royal Australian Air Force equipment. But while the Department is encouraging outside industry to develop the capacity to produce this sort of equipment, which to some extent is a good thing, its own establishments are running down. I come back to my first point. Whilst in the first, instance the Weapons Research Establishment was dovetailed into the Woomera Rocket Range, it must now have a capacity which could be used to supply some of. the market for this equipment and which should be used if there is any sign of insecurity. As the Minister well knows, many of the officers and men who are working at the Weapons Research Establishment at Salisbury are uncertain about the future. There is uncertainty for the reasons that the Minister stated in his reply to a question that I asked yesterday and in the reply that he has just given to **Senator Laught.** While there is that uncertainty, there is development of the capacity of outside industry in which, it seems to me, the Department of Supply should be able to participate. 1 notice that the report on the activities of the Department, at page 29. deals with the continuing interest in stimulating the production of high grade electronic components for military applications, lt also talks about interest and developments in micro-electronic devices. I do not think the Minister will be able to answer me straight away; but what T put to him is that, in view of the contracts that are being offered and the arrangements that are being made with industry, he and his Department should be investigating the extent to which they, in a period of lean employment in the Department, particularly at Salisbury, can use departmental employees in either supplying techniques for research or taking part in the supply of some of the orders that are now being given to private contractors. That is the first point. My other point relates to the Government Aircraft Factories. Recently the Minister, in answer to a question of mine, said that the Services either separately or in conjunction are ordering package lots from overseas. The instance 1 quoted was the case of the single engine aircraft which was bought by the Department of the Army apparently without proper interviews and consultations with our own Government Aircraft Factories or the Commonwealth Aircraft Corporation. What I cannot understand is why, if it is the Government's intention to make Australia independent, it does not see to what extent its own factories might be able to share in the production of such equipment. The Minister may say - perhaps I will persuade him not to do so - that the Government Aircraft Factories, because of their production methods, fabricate aircraft or engine parts. As I pointed out recently these Factories are now producing such things as cubicles and large parts for outside industry. They are entering into the manufacturing business to keep a skilled staff employed in the hope that in the future they may continue to manufacture aircraft. Those are the general questions I raise. I ask the Minister, in relation to future policy, to have regard to the two objectives I have stated. Why not let the Weapons Research Establishment take part in this production and thus allay the feeling of insecurity because of the belief that the staff cannot be employed in the near future? Let them share in this work. The Government ought to be able to plan and to change production methods in order lo allow some of this work, which is now being allotted to private contractors, to be allocated to the Government Aircraft Factories. {: #subdebate-31-0-s9 .speaker-JZQ} ##### Senator ANDERSON:
Minister for Supply · New South Wales · LP -- As the Senate will be rising at 10.30 p.m., it has occurred to me that it might be more appropriate if honourable senators opposite were to raise now any further matters that they wish to mention. That would enable ne to obtain a more detailed explanation and have it available when we resume the discussion on Tuesday next. J am perfectly happy to give explanations now, but if any honourable senator wishes to raise matters in the few minutes remaining I .shall be perfectly happy. {: #subdebate-31-0-s10 .speaker-KPG} ##### Senator KEEFFE:
Queensland -- There are several references in the Auditor-General's report that I have not collated in detail with the statements in relation to the Estimates. It may be helpful if I list these references because a little research may be needed. Under the heading 'Production', relating to the various production centres under the Department of Supply, the report states at page 296: >The factories undertake some work for nonService departments, Government authorities, other Governments, and private industry. These activities result in the absorption of some of the overhead costs incurred in maintaining production capacity for emergency defence needs. What are the non-Service departments referred to? I assume that the Government authorities would be those associated with the Federal Government. I should like information on' that matter also. Are the other governments referred to governments in Australia? What are the types of private industry referred to? During previous debates of this nature I have not seen this set out in as much detail as it is on this occasion. Another statement on whichI require clarification is: >Overhead costs determined by the Department as attributable to the maintenance of capacity for emergency defence needs .... What are classified as emergency defence needs? Is it because of possible aggression or the short supply of materials that the costs are worked out? Another statement on page 297 of the report is: >The planned rearrangement of plant and equipment designed to reduce production, costs, continued during the year. Last year the reference to this matter was only very brief.I think it would be very much more helpful if we had more detail of the planned rearrangement of plant and equipment designed to reduce production costs. How did this rearrangement take place? Did it result in reduced capital expenditure? Referring back to the particulars of proposed expenditure we find a similar reference, under Division 772, to rearrangement of capital facilities. The appropriation last year was $200,000, which was underspent. This year there is an increase of $40,000 in the appropriation. I do not think I went into great detail regarding Division 720, subdivision 1, item 03 when I opened my contribution to the debate. I proceeded to criticise the Minister for not producing the statement 2 or 3 days earlier so that we could study it. This is a fascinating item. The appropriation was underspent by $48. Why is an appropriation of this nature made? If it is made on the basis that the Government knows in advance what the salary will be why is it underspent by $48? The Government cannot say there was an alteration in the salary scale over the year because this year the provision is exactly the same - $15,000. If the $48 is made up of stamp duty or petty cash, tell us so. The next matter to which I wish to refer relates to administrative expenses in Division 720. Could the Minister provide some explanation of the amount of $154,000 in relation to item 05, training of personnel, which was underspent last year and for which there is an increase of something like $40,000 this year? Consideration interrupted. {: .speaker-K3J} ##### The TEMPORARY CHAIRMAN (Senator Bull: -- Order! In conformity with the sessional order relating to the adjournment of the Senate, I formally put the question: >That the Temporary Chairman do now leave the Chair and report to the Senate. Question resolved in the affirmative. (The Temporary Chairman having reported accordingly) {: .page-start } page 666 {:#debate-32} ### ADJOURNMENT The **PRESIDENT (Senator the Hon. Sir Alister McMullin)** - Order! In conformity with the sessional order relating to the adjournment of the Senate, I formally put the question: >That the Senate do now adjourn. Question resolved in the affirmative. Senate adjourned at 10.31 p.m.
Cite as: Australia, Senate, Debates, 12 September 1968, viewed 22 October 2017, <http://historichansard.net/senate/1968/19680912_senate_26_s38/>.