Senate
11 May 1971

27th Parliament · 2nd Session

  1. Senate
  2. 27th Parliament
  3. 1971

The PRESIDENT (Senator the Hon. Sir Alister McMullin) took the chair at 1 1 a.m., and read prayers.

page 1617

KANGAROOS

Petition

Senator MULVIHILL:
NEW SOUTH WALES

-I present the following petition:

To the honourable the President and Members of the Senate in Parliament assembled. The humble petition of the residents of the State of New South Wales respectfully sheweth:

The red kangaroo and many other marsupials, through shooting for commercial purposes, have been reduced to a numerical level where their survival is in jeopardy.

None of the Australian States have sufficient wardens to detect and apprehend people breaking the laws in existence in each State, and in such a vast country only uniform laws and a complete cessation of commercialisation can ensure the survival of our national emblem.

It is an indisputable fact that no natural resource can withstand hunting on such a concentrated scale, unless some provision is made for its future.

We, your petitioners, therefore humbly pray that:

The export of all kangaroo products be banned immediately, and the Commonwealth Government make a serious appraisal of its responsibility in the matter to ensure the survival of the kangaroo.

And, your petitioners, as in duty bound will ever pray.

Petition received and read.

page 1617

NOTICE OF MOTION

Senator WRIGHT:
Minister for Works · Tasmania · LP

– I give notice that tomorrowI intend to move:

That, in accordance with the provisions of the Public Works Committee Act 1969, the following proposed work be referred to the Parliamentary Standing Committee on Public Works for investigation and report:

Construction of a Communications Building - Bendigo, Victoria.

page 1617

QUESTION

PAPUA NEW GUINEA

Senator WILLESEE:
WESTERN AUSTRALIA

– I ask the Minister representing the Minister for External Territories: Was a 9-year-old Papuan boy sentenced to 6 months gaol on each of 4 charges in the Port Moresby Children’s Court last Friday, and did the magistrate direct that this 2-year sentence be served in Bomana Gaol as there is no reformatory for juvenile offenders? Will the Minister take immediate action to ensure that, firstly, this child will not be imprisoned for any period in a gaol where he might come into contact with adult criminals and, secondly, arrangements are made for the adequate accommodation and rehabilitation of juvenile offenders in the Territory?

Senator WRIGHT:
LP

– I have only newspaper information with regard to the conviction but I have no reason to doubt that the position is as the honourable senator has said. I readily inform him that I shall communicate his request at once to the Minister who, I have no doubt, will consider it sympathetically. If action in that direction has not been taken already, I assure the honourable senator that the Minister will be ready to give consideration to it at once.

page 1617

QUESTION

MEDICAL FEES

Senator HANNAN:
VICTORIA

– Has the Minister for Health seen a statement by the Leader of the Opposition in another place claiming that the Minister deliberately delayed his statement to the Senate on medical fees and benefits until the House of Representatives had risen?

Senator Cavanagh:

– Do you deny it?

Senator HANNAN:

– Will you allow me to ask my question?

Senator Cavanagh:

– Do you deny it?

Senator HANNAN:

– The Minister will answer. Is this claim by the Leader of the Opposition correct? Does this, together with allied statements, indicate that the Labor Party believes that the doctors are the only section of the community which is not allowed to increase its fees? Is the Minister aware of the Labor Party’s policy in respect of strikes by doctors? Has the Minister seen a quaint editorial in this morning’s ‘Age’ covering other aspects of rises in medical fees?

Senator GREENWOOD:
Minister for Health · VICTORIA · LP

-I did read a copy of what purported to be a Press statement by the Leader of the Opposition, Mr Whitlam, and the Press coverage of that statement. I have seen also a copy of the editorial which appeared in the Melbourne ‘Age’ this morning. With regard to each of those documents I say as follows: Mr Whitlam’s statement is quite untrue. The statement which I made to the Senate last Friday was not deliberately delayed until the House of Representatives had risen. I was striving to have that statement completed and it was presented at the earliest opportunity. 1 can only suggest that, if Mr Whitlam desires to make some point from the fact that the statement was made in the Senate only on Friday, this shows a lack of confidence in his colleagues in the Senate and that he feels that they would be unable to ask questions about the statement.

With regard to the statement which appears in the editorial of the ‘Age’ this morning, I regret that a responsible newspaper has published an editorial which in so many respects lacks an accurate foundation and makes comment which fails to take account of very obvious considerations. I mention one matter only. The editorial stated that my statement on Friday carefully avoided any reference to the question of specialists’ fees. Far from that being the case, a very careful reference was made to the fact that in discussions with the executive of the Australian Medical Association it was ascertained that the proposal which it had made in February for across the board specialist fee increases would not be pursued and that any fees for services other than general practitioner services would be considered in the light of information which was available as to doctors’ incomes, including details of incomes of groups of doctors, for particular medical services. In these circumstances I am indebted to the honourable senator for asking the question because it gives an opportunity in this place to be able to correct the incorrect impressions which have been put abroad.

page 1618

QUESTION

MEDICAL FEES

Senator WILLESEE:

– I address a question to the Minister for Health. In view of the deal between the Government and the doctors which was announced last Friday and by which general practitioners’ consultation fees will rise by an average of 15 per cent, will the Minister, firstly, make public all the economic and other relevant information on which the negotiations and subsequent deals were based; and, secondly, give an assurance that there will bc no further rises in medical fees for at least 2 years?

Senator GREENWOOD:
LP

– I assure the honourable senator that contrary to the statement made by the Leader of the

Opposition, Mr Whitlam, there was no deal between the doctors and the Government. The position is that the doctors announced that fee increases would be recommended. In response to that announcement, which was made last February, the Government, because it has the responsibility for fixing what would be the Commonwealth benefits and fund benefits on the basis of whatever fees the doctors charge, said that the fees proposed were unacceptable and were not justified, and that it was the belief of the Government that they could not be justified. As a result of the Government’s statement at that time the doctors revised the recommendations which they were prepared to make. The result of that revision of their recommendations on the total cost to the community was a reduction from $35m to just over $9m.

I am not prepared to make public any documents relating to a deal because, as I have said, there was no deal. Insofar as the fees which were recommended by the doctors were based upon research conducted by a committee called the Economic Advisory Committee, which was appointed by the Australian Medical Association, the documents which it had are confidential to the doctors. I am unable to give an assurance that there will be no increases in doctors’ fees over the next 2 years because it is not within my power to say what doctors will charge. All I can say is that we have received an assurance from the Australian Medical Association that there will be no recommendation from that body with regard to general practitioners fees for the next 2 years and that, with regard to other services, any increases will be made only after there has been a full scrutiny of all relevant material, and we do not believe that they will be of great order.

page 1618

QUESTION

CANBERRA COMMUNITY HOSPITAL

Senator BUTTFIELD:
SOUTH AUSTRALIA

– Can the Minister for Health inform the Senate of the facts which influenced him to make the statement that fees at the Canberra Community Hospital would be raised by 44 per cent in public wards and 52 per cent in private wards? Has he considered what effect this might have on all State hospitals in the way of up grading fees and, if so, does he think that they will do the same?

Senator GREENWOOD:
LP

– I should mention that I have made no public statement on fee increases at the Canberra Community Hospital. What I have done is to seek the advice of the Board of the Canberra Hospital as to certain suggestions and statements which I have put to the Board and 1 expect to receive in due course advice from it. I should say, with regard to the point of Senator Buttfield’s question, that hospital, fee increases have been announced in ail States of the Commonwealth except Queensland which, of course, is not affected, and New South Wales where, I understand, an announcement of fee increases is likely to be made in the near future. There have been fee increases already in 4 States and the position in Canberra I believe is no different from the position in those other States where increases in nurses’ wages, increases in other administrative costs and general increases brought about by the national wage case last year, must increase the cost of running hospitals. I expect in due course to receive a statement of the Canberra Hospital Board’s opinion as to what should be done at the Canberra Hospital. When 1 receive that statement, I shall give consideration to what the Board puts to me in the light of the letter which I wrote to it and which was received by the Board and considered by it yesterday.

page 1619

QUESTION

REVALUATION OF THE DEUTSCHE MARK

Senator BYRNE:
QUEENSLAND

– Will the Minister representing the Treasurer request the Treasurer to make a considered statement which will necessarily be outside Parliament - the House of Representatives having risen - on the implications for Australia of the floating of the Deutsche mark and the revaluation of certain European national currencies?

Senator Sir KENNETH ANDERSON:

I was asked a question last week by an honourable senator in relation to the implications of the movement of European currency, with particular reference to the Deutsche mark and the American dollar. As I promised at question time on Friday, I have sought a statement from the Treasurer. In fact, I have a statement from the Treasury which runs into 4 or 5 pages. I have to make up my mind as to how I shall present it - whether I present it as a statement by leave later or whether 1 circulate it. I do not think it is appropriate to present it at question time because it is so comprehensive. I also feel bound to say that it is still early days because there may be further movements. The statement represents the position only up to the present. It is a Treasury appreciation of the present situation. In the days ahead, there may be movements which may necessitate the making of a further statement. However, I will give consideration during the day as to how I shall present this statement to the Senate.

page 1619

QUESTION

TRAINEE PILOTS

Senator LAWRIE:
QUEENSLAND · CP; NCP from May 1975

– I ask the Minister for Civil Aviation a question. I refer to certain Qantas Airways Ltd pilots who are under notice of dismissal. Will the Minister ascertain whether Qantas is prepared to pay compensation to those trainee pilots under notice of dismissal who were forced to put up substantial bonds, provided either by their parents or by themselves, to be accepted and trained by Qantas and to stay with that company for 5 years?

Senator COTTON:
Minister for Civil Aviation · NEW SOUTH WALES · LP

– I am sure the honourable senator is referring to the cadet pilots in the Qantas situation. I do not have with me any detailed statement of what is intended to be done about the problem the honourable senator has mentioned. I think I should direct this question to Qantas. As employers, it is really their responsibility; it is not mine as Minister for Civil Aviation. It is a bona fide question and I know it contains some overtones of concern for the honourable senator, as it does for me also. I will take the matter up with representatives of the airlines this evening.

page 1619

QUESTION

HEALTH

Senator KENNELLY:
VICTORIA

– I preface my question to the Minister for Health by saying that I was intrigued by his answer to a question from Senator Hannan in which he said that a statement by the Leader of the Opposition in another place was false. I ask: Would I be false in my belief that the question asked by Senator Hannan was a Dorothy Dixer?

Senator GREENWOOD:
LP

– I can assure the honourable senator that 1 did not know what questions Senator Hannan was proposing to ask this morning. Since the honourable senator has given me an opportunity to enlarge on the matter raised by both Senator Hannan and himself, I point out that the statement made by the Leader of the Opposition, Mr Whitlam, stated in quite categorical terms that I had deliberately delayed an announcement, which imputes to me a conscious intention. That is quite untrue. I cannot understand on what basis a statement of that character could possibly have been made, because the Leader of the Opposition could have no knowledge of the facts I had. All I can say is that 1 regret that a person holding the responsible position of Leader of the Opposition should have made a statement so lacking in foundation.

page 1620

QUESTION

SHIPPING

Senator DAVIDSON:
SOUTH AUSTRALIA

– My question is directed to the Minister representing the Minister for Shipping and Transport. It refers to a claim made by South Australian fishermen that ships passing along the South Australian coast are pumping out their bilges within the vicinity of the coast with the result that a considerable number of penguins are dying in oil slicks. I ask: Can the Minister say whether the Department of Shipping and Transport, in licensing vessels to trade on the Australian coast, can exercise any control as to the areas in which ships discharge their waste? Will the Minister initiate inquiries into the validity of the claims made by the South Australian fishermen and ascertain whether oil and other discharges from ships can be more effectively controlled in Australian coastal areas?

Senator COTTON:
LP

– Taking the last part of the honourable senator’s question first, I will certainly ask the Minister and the Department to look into this matter and to make inquiries to see what has been happening. It is a matter of some concern to me as I am sure it is to all honourable senators, that this is happening, if indeed it ls. There are some regulations - I am not familiar with them in detail - relating to ships pumping out their bilges and oil tankers cleaning out their bottoms. I do not know the limitations in this regard. I shall find out.

page 1620

QUESTION

RURAL INVESTMENT

Senator O’BYRNE:
TASMANIA

– My question is directed to the Minister representing the Minister for Primary Industry. I draw the Minister’s attention to an advertisement in yesterday’s ‘Australian Financial Review’ headed ‘Reduce your Tax Bill - become a Primary Producer’. The advertisement seeks the support of investors for a scheme to purchase, develop and stock beef cattle properties. The advertisement also states that long term capital gains are anticipated and goes on to say: ‘Most of the money invested is tax deductible.’ I ask the Minister: Why should these investors be allowed to enter a crowded market for virtually no capital outlay? Why is their investment tax deductible when current legislation is providing for the Australian taxpayer to contribute $J00m to a rural reconstruction scheme to rationalise rural industries and when many dairy farms are turning to beef cattle production? Will he look into this dubious situation and act to restore some justice in the tax laws to protect the Australian taxpayer as well as the cattle farmers, who will be assisted in turn by the Australian taxpayer?

Senator DRAKE-BROCKMAN:
Minister for Air · WESTERN AUSTRALIA · CP

– I have not seen the advertisement to which the honourable senator has referred, but I should think that the person who placed the advertisement in that newspaper would have to continue to advertise to get a response because anyone who is thinking about investing in primary industry these days will know that there is not very much profit to be made. I should think that somebody who wants to claim a deduction when he knows a profit is doubtful would want to do a fair bit of investigating of the matter first. However, I will take the matter up with the Minister for Primary Industry and see whether he has any information to make available to the honourable senator.

page 1620

QUESTION

THIS DAY TONIGHT

Senator YOUNG:
SOUTH AUSTRALIA

– I direct a question to the Minister representing the PostmasterGeneral. Has the Minister seen reports to the effect that a study is being undertaken by 2 academics of the University of New South Wales into the alleged political bias of the current affairs programme ‘This Day Tonight’? Does the Minister have any information on this study? If so, can he give the Senate any details of the findings of the research.

Senator GREENWOOD:
LP

– I have seen in the last 3 or 4 days several Press reports of a study which is being undertaken in, 1 think, the University of New South Wales with regard to the alleged bias of the Australian Broadcasting Commission programme ‘This Day Tonight’. I think 1 should say at the outset that the policy of the Government, which has been consistently followed and stated over a very long period, is that the Commission is an autonomous, independent body and that it alone is responsible for its radio and television programmes. The Government has asserted, and asserted strongly, that viewpoint on every occasion. However, if there is within that autonomy a controversy as to whether fairness is displayed in the presentations made by the Australian Broadcasting Commission it is only in the public interest and to be encouraged that there should be public discussion at a responsible level as to whether these accusations and allegations have some basis. The reports that 1 have read indicate that the study being conducted is a dispassionate examination of factual material. One can only hope that there will be more of this so that the public will be better informed as to whether there is truth in such allegations and, if there is, that those responsible will be encouraged to exercise prudence and responsibility in the type of presentations which are made.

page 1621

QUESTION

AVIATION

Senator WRIEDT:
TASMANIA

– My question is directed to the Minister for Civil Aviation. Is the Minister aware that on a flight to Melbourne last Friday evening on which several honourable senators were present, including one of his ministerial colleagues, all members of the cabin crew were still working when the aircraft was approaching Melbourne Airport at less than 1,000 feet and that at least one was still standing when the aircraft landed? In view of the Minister’s statement last week that he has initiated discussions with the 2 major airlines to rectify the present situation concerning the serving of meals and drinks on high density flights, and bearing in mind that it may take some time for these negotiations to be completed, will the Minister issue an immediate instruction that, pend ing the outcome of these negotiations, all scheduled flights of less then 75 minutes duration will observe the same meal procedures as were recently introduced on the Sydney to Canberra leg? If the Minister is not prepared to take this action, will he advise the Senate as to how long he is prepared to allow these breaches of the regulations of the Department of Civil Aviation to continue?

Senator COTTON:
LP

– Yes. I do know about the incident to which the honourable senator referred. The airlines have been contacted. In addition, I intend to ask an examiner to have a good look at the situation and obtain an objective view of what is really happening. As far as I am aware, the honourable senator was referring to a flight of Trans-Australian Airlines. I gather that Ansett Airlines of Australia has also done the same thing. If any honourable senator has information which would confirm that the same thing has happened on an Ansett flight I would like to have it. But 1 am putting an examiner in to look at this whole situation, which concerns me, as it does the honourable senator and my colleagues in the Senate.

page 1621

QUESTION

TOURISM

Senator LILLICO:
TASMANIA

– 1 direct a question to the Minister-in-Charge of Tourist Activities. Because of the very great advancement in atomic power generation, which advancement is continuing and accelerating, to a stage at which it is predicted that in most advanced countries future power installations will be solely atomic, would not the authorities in Tasmania be advised to pause before committal to further large scale hydro-electric generation projects, which some people claim are destructive of tourist assets in Tasmania, an aspect in which the Minister is particularly interested?

Senator WRIGHT:
LP

– I am acutely aware, of course, that coming into controversy in Tasmania is the argument whether development of hydro-electric power is destroying tourist attractions that should be conserved. In regard to Lake Pedder, great anxiety has been expressed at the inundation of a small lake and displacement thereof by a big lake with several times the capacity of Lake Eucumbene. I know the area. The new Lake Pedder, which will be part of the hydro-electric development, will be a magnificent stretch of water at the foot of the loveliest of mountains and a substitution for the present Lake Pedder of magnificent beauty. With regard to the hydro-electric development in the Mersey Valley where 7 dams are being built, a variety of tourist activities will be provided on each of those dams in the form of fac- ilities for boating, yachting and fishing. These amenities will adorn the valley in the way in which the Hydro-Electric Commission arranges such things in Tasmania. Then concern is being felt as to the lovely Pieman River, a river without parallel beauty, I feel, in Australia. I have already made inquiries and I have the report on the Pieman River programme which has been submitted to Parliament. I have a reasonable assurance from the HydroElectric Commission that the only effect of developmental works on that river will be at the headwaters and that there will be no effect upon the waters where the major scenic attraction is. I have every confidence that not only is conservation being well attended to in this development but also the scientific aspect of atomic energy overtaking hydro-electric energy is being well understood by the HydroElectric Commission in Tasmania.

page 1622

QUESTION

DOCTORS’ FEES

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

My question is directed to the Minister for Health. Did he state in his ministerial statement last Friday that whilst the amount of increase in medical benefit fund contributions which is directly attributable to the general practitioner fee increase is only about 2c a week in New South Wales and Victoria, nonetheless the contributions to the major funds for medical benefits are expected to be increased by between 5c and 10c a week in New South Wales, Victoria and Western Australia and by between 6c and 11c a week in Queensland because of the actual experience of individual funds and against a background of expected developments? Will the Minister elaborate on what the expected developments are to which he referred in his statement? Do they take into account any increase that might take place in specialist fees, which is still likely to occur? Finally, why is it that in some States there are to be such large increases in contributions - up to 5 times more than the 2c a week in New South Wales, Victoria, Western Australia and Queensland - whilst funds in South Australia and Tasmania are expected to be able to meet the higher fund benefits from the existing contributions?

Senator GREENWOOD:
LP

– In the statement presented to the Senate last week I referred to a background statement which gave the sort of elaboration which the honourable senator is seeking. With regard to the reasons why, when the increase in doctors’ fees would mean an increase in contribution rates of only lc or 2c, it was likely that in the major States the increase in contribution rates would bc 5c to 10c I said that this was because the operations and financial position of the individual funds require periodic review so that contribution rates may be fixed for each fund in the light of actual performance and against a background of expected developments. The existing contribution rates were last set to enable excessive reserves to be reduced, and the position of some funds now requires that the contribution rates should be increased in order to take account of present and likely benefit commitments and the increasing growth and utilisation of services.

I would have thought that that was the type of answer which the honourable senator was expecting. Naturally with an increasing population there is a greater growth of services. Naturally with a greater public appreciation of the values of the Government’s national health scheme there will be a greater utilisation of services. Naturally when there has been a relatively lower setting of contribution rates over the past year because some funds had excess reserves there would have to be an updating of those contribution rates when the excess reserves became exhausted. There is always within the 2- year period for which doctors’ fees are generally set the necessity to have some committee like the Anomalies Committee which will take account of suggestions which come from various quarters that in particular cases the common fees which have been set have been set on inaccurate bases and should be remedied. There is also the need to have regard to the fact that applications may be made from time to time for some revision of fees other than the general practitioner fees. All these natters have been taken into account and we feel that the proposed increase in contribution rates of Se to 10c per week for a family in an era of rising costs and incomes is something which most people can well bear. As to why in Tasmania and South Australia there is prospectively no change, or only a very slight change in contribution rates, on the information available to me this is because the reserves which are held by the funds will enable these increases and these expected developments to be taken account of without any increase in the rates.

page 1623

QUESTION

BUTTER

Senator DEVITT:
TASMANIA

– My question is directed to the Minister representing the Minister for Primary Industry. The Minister will recall that last year the then Minister for Primary Industry made a strong plea to the dairying industry to cut back production because of the threatened consequences of over-supply. Is the Minister aware that the industry responded to this request and followed courses of action to meet the Minister’s wish? Is he further aware that shortly thereafter demand for primary industry commodities strengthened and valuable overseas earnings were lost through the cut-back? What is the present situation? Because of widespread confusion and misunderstanding in the industry and as a new season is about to commence, will the Minister request his colleague to make an early statement giving expression to the Government’s current thinking on this matter?

Senator DRAKE-BROCKMAN:
CP

– I well recall the time that the honourable member has referred to when Australia’s production of butter was 220,000 tons. The basis of the new guarantee given to the dairying industry was that if the industry maintained production to around that amount for the coming year the Government assured the industry of 34c per lb in commercial butter. In the intervening period Australia’s production of butter has slipped and the present indications are that production for this year will be about 205,000 tons. The situation in Britain is that in recent months there have been continual increases in the price of butter - so much so that it is now £Stg 420 a ton. This has been brought about by the poor season in Bri tain and Europe and the depletion of the stockpile in the European Economic Community. Until the new season commences in Britain there will be a shortage of butter. So the situation has changed greatly since the time referred to by the honourable senator. I will make some inquiries and if I have some further information to give to the honourable senator I will do so.

page 1623

QUESTION

RESALE PRICE MAINTENANCE

Senator RAE:
TASMANIA

– My question is directed to the Minister representing the AttorneyGeneral. Has the Minister’s attention been drawn to newspaper reports of a statement made by the Premier of South Australia, Mr Dunstan, that he is considering taking action to make impossible the establishment of cut price petrol retail outlets in South Australia? Does this indicate a case for either the Federal Government or the President of the Australian Council of Trade Unions, Mr Hawke, to intervene to prevent Mr Dunstan’s retail price maintenance plans being implemented?

Senator GREENWOOD:
LP

– I have seen the Press statement of what the Premier of South Australia is alleged to have said with regard to preventing in some way people from selling petrol to the public at cheaper prices than those which are at present prevailing. I would have thought that the spirit of competition should be allowed to prevail. If people can get their petrol cheaper they should be given the opportunity to do so and a government should not step in to prevent the people of Australia, or the people of South Australia in this case, from getting cheaper petro). I fail to understand, if the Premier of South Australia is correctly reported, why he is not prepared to refer any problem he sees in this area to the Commissioner of Trade Practices. I understand the position is simply that some people are wanting to secure a proportion of the market. They are not in a dominant position and they are endeavouring to break in by the traditional method of selling their product more cheaply than that of their competitors. I hope that this is not to be discouraged. As to whether it is a matter for the Federal Government or the Australian Council of Trade Unions, I will refer the question to the Attorney-General for his consideration. I would very much doubt whether it is a matter for the Australian Council of Trade Unions because, after all, it has no commercial interest in petrol stations at the moment.

page 1624

QUESTION

AIR FARES

Senator MURPHY:
NEW SOUTH WALES

– My question is directed to the Minister for Civil Aviation. Will the Minister tell us what he is doing to see that the public of Australia get the opportunity to travel overseas at prices lower than those which are fixed by the international cartel controlling the industry and which bear heavily on the people of Australia? Will he tell us whether he has left these matters to be determined by the representatives of Qantas Airways Ltd who are pushing for higher fares on overseas flights? Further, will he tell us when the Senate will be able to obtain some information as to whether Qantas is actually going to pay to pilots basic salaries which will amount to some $25,000 and could be more than $30,000 a year, as alleged in the newspapers, or do we have to look to the daily newspapers and not the Minister for our information? I also ask: When will I get the information which I asked for on 29th April last about the amount of superannuation payments to which pilots of Qantas are entitled and the amount to which they think they should be entitled?

Senator COTTON:
LP

– First of all let us look at the question of what Qantas Airways Ltd is supposed to do in relation to cheap fares and what somebody else is supposed to do. In the financial year 1970- 71 Qantas flew 106 affinity group charters to London and 98 to Australia. On these flights the airline carried 26,000 passengers. lt also recorded 264 migrant flights carrying 44,414 passengers. The total number of charter flights in 1970-71 was 653, with 93,224 passengers. Last year Qantas revenue earnings from charters amounted to $26. 8m which was a substantial part of its business. From time to time one is mystified at the attempts made by all kinds of people to help Qantas with its charter business. One would think that Qantas was not in the charter business. Of course it is. Another misconception which is found from time to time is in relation to fare comparisons. The charter fare which Qantas offers to London is $682, not $1,300. There is not a great amount of difference between the charter fare of a scheduled international carrier and that of those people who claim to offer cheap discounted fares on non-scheduled, nonrecognised operations.

Senator Murphy posed a number of questions on salaries and superannuation. I am expecting an answer to his question regarding superannuation any day. Under the arrangements negotiated properly between the employer. Qantas, and its employees, the pilots and associated aircrew, a Qantas line captain will receive a salary of $24,511 for flying a Boeing 747 aircraft. It is quite relevant to comment also that under the same aircraft flying conditions a Pan American World Airways jumbo captain receives $59,000. It is possible for a Qantas captain or member of an aircrew to earn more money than his basic salary by flying longer hours. I think that covers the points that the honourable senator raised.

Senator Murphy:

– I asked about superannuation.

Senator COTTON:

– I said that I would obtain an answer for the honourable senator did I not? I again say - I hope honourable senators will bear with me when I say this - that Qantas has to manage its own affairs. T do what I can to help. But if it is expected of me that I shall, every day of my life, pick up the management problems of Qantas, then that is just not going to happen.

page 1624

QUESTION

MERINO SHEEP

Senator BULL:
NEW SOUTH WALES

– My question is directed to the Minister representing the Prime Minister and/or the Treasurer. In the forthcoming Budget discussions will the Government give consideration to some form of financial assistance to merino sheep stud breeders, many of whom are faced with financial ruin which, if not averted, will bring about a marked decline in numbers and quality of stud sheep, because of a marked decline in wool prices and huge increases in costs?

Senator Sir KENNETH ANDERSONIn the pre Budget period there are discussions in relation to the preparation of the Budget. They cover the whole structure of government including Commonwealth-State relations, social service benefits, repatriation benefits and primary industry. In fact, every function of government comes under review during Budget considerations. All I can do is refer the honourable senator’s question to the Treasurer.

page 1625

QUESTION

EUROPEAN ECONOMIC COMMUNITY

Senator POYSER:
VICTORIA

– Is the Minister representing the Minister for Trade and Industry aware that Mr Geoffrey Rippon, Britain’s chief Common Market negotiator, is now in Brussels to commence talks on what could be the decisive phase of Britain’s entry into the European Economic Community? Are Press statements true that the main issues will be New Zealand’s butter exports, Commonwealth sugar and Britain’s financial contribution to the European economic community? What steps have been taken by the Australian Government to ensure that matters of great importance to Australia are considered? I refer to our dairy produce exports, the canning industry, the meat industry, the sugar industry, the dried fruits industry and many other industries which export substantial quantities of goods and produce to Britain.

Senator COTTON:
LP

– 1 too read the newspaper article. I note that Mr Rippon, whom I have met, is going to Brussels to discuss negotiations. Other newspapers contain opinions bearing on the whole subject Some say that Britain is going to join the Common Market. Others say that Britain is not going to join the Common Market. People in New Zealand who are well informed on this matter have been making comments to the effect that the public of the United Kingdom will not agree to the United Kingdom entering the Common Market. Other people say that it will. The scene is most confusing. I do not know what is happening at the present time. 1 do know that top level discussions will take place after Mr Rippon does his particular job in Paris. I imagine that these final discussions will determine what Britain will do. Whether the price exacted from Britain for going into the Common Market is felt to be worthwhile, is a matter of judgment for the United Kingdom and not for me. New Zealand has been active in the United Kingdom pushing its particular case in the areas mentioned by Senator Poyser. It would be a mistake to imagine that Australia has not been equally active.

I shall refer the question to the Minister for Trade and Industry so that, if he wants to say anything more than that, he may do so.

page 1625

QUESTION

QANTAS: JUMBO JETS

Senator BISHOP:
SOUTH AUSTRALIA

– I ask the Minister for Civil Aviation: Does the reported agreement on salaries between Qantas and the Australian Federation of Air Pilots mean that the 747s will fly on time? Have the necessary administrative steps been taken to enable the training of crews to commence this operation? Will the agreement in relation to the jumbo jets provide a basis for the retention in the service of the aircrew and flight engineers who are likely to leave during the currency of the 747 operations as a result of having been given notice of termination of employment? If not, is it a fact that the flight engineers and some of the aircrew have been recruited from overseas in recent times by Qantas personnel? Will the Minister take some initiative to see that the aircrew and flight engineers are retained for some time, even though it may mean some sort of a temporary subsidy?

Senator COTTON:
LP

– Under the arrangements that have been reached between Qantas as the employer and the technical aircrew as the employees, the 747s will begin to fly on time as scheduled. The redundancy notices which were issued to technical aircrew some time ago because of the decline in business of Qantas are for 6 months, on the basis of first on last off, as the honourable senator would understand. A great deal depends on the success of Qantas getting its 747s into the air and if possible, increasing its total traffic. The question of its employment of people to fly these aircraft is entirely dependent on that. The general problem of a surplus of pilots and engineers has been worked on, and we have reached a satisfactory arrangement at the present time. I ask honourable senators to bear in mind that the notices are for 6 months, and a lot can happen in that time.

page 1625

QUESTION

CITIZENSHIP

Senator MULVIHILL:

– I direct a question to the Minister representing the Minister for Immigration. By way of preface I refer to the recent United States Supreme Court decision which terminates the

United States citizenship of a foreign born child of an American parent unless the child lives in the United States for 5 consecutive years between the ages of 14 and 28. Under the provisions of section 7 of the Citizenship Act of 1969, are similar obligations placed upon the foreign born child of an Australian parent?

Senator GREENWOOD:
LP

– The answer to the honourable senator’s question is simply no. Section 11 of the Nationality and Citizenship Act means that a person who is born out of Australia and whose mother or father is an Australian citizen, providing only that the birth is registered at an Australian consulate, is also an Australian citizen. Section 1 8 of the same Act provides that when a person is a citizen of another country as well as being an Australian citizen, the Australian citizenship can be renounced when that person turns 21 years, of age. But a person does not cease to be an Australian citizen solely by reason of absence from Australia.

page 1626

QUESTION

CANBERRA HOSPITAL

Senator KEEFFE:
QUEENSLAND

– My question, which is directed to the Minister for Health, is supplementary to the question asked by Senator Buttfield earlier today. Can the Minister inform the Parliament of the source of his authority for interfering directly in the affairs of the Canberra Hospital in relation to hospital fees? Is the Minister prepared to table in the Senate copies of any letters he forwarded to that hospital?

Senator GREENWOOD:
LP

– There has been no interference in the affairs of the Canberra Hospital. The honourable senator will be aware that the Commonwealth Government provides a substantial sum of money towards the running of the hospital. As 1 understand the position, in the last 2 years, while there has been no increase in in-patient charges, the amount which the Commonwealth has provided has increased by 53 per cent or from something like $2.7m to about $4.1 m. In these circumstances I wrote a letter to the Chairman of the Hospital Board bringing to his attention the fact that there has been an increase in the Commonwealth’s contribution and indicating that there has to be some consideration not only of these hospital charges but also of all the charges for every service which the hospital provides. I asked for the advice of the Hospital Board on the various matters to which I drew its attention in my letter. I did so not because I am under any obligation to refer these matters to the Hospital Board since the decisions as to charges are decisions for the Government ultimately, but because I felt it was a prudent, proper and responsible thing to do to seek the advice of the Board which runs the hospital.

page 1626

QUESTION

PENSIONER HOSPITAL COSTS

Senator FITZGERALD:
NEW SOUTH WALES

– I ask the

Minister for Health whether he has seen the statement by the Chief Executive Officer of Sydney Hospital that if the Commonwealth paid a full subsidy for pensioner patients the hospital would be able to meet present increased costs? Is it true that the Commonwealth subsidises pensioner beds at the rate of $5 a day? Is the Minister aware that the hospital claims that each pensioner bed patient costs $25 a day and that pensioner treatment costs at Sydney Hospital amounted to $800,000 last year? Although the Minister as a new Minister is not to blame, I ask him whether he regards the $5 a day payment as a miserable pittance. Will he take immediate action to rectify this paltry daily amount paid by the Commonwealth to the State for pensioner bed patients and thereby allow Sydney Hospital to charge just fees to its other patients?

Senator GREENWOOD:
LP

– The honourable senator’s question is a very involved one and raises many matters upon which I could comment at length. I have not seen the report to which he referred but I have seen reports of similar character which have emanated from hospital managements. All I can say is that what ought to be the Commonwealth’s contribution towards assisting with the finances of hospitals is currently under review. Particularly under review is the question of the amount paid to hospitals for the free treatment they provide to pensioners. This must be taken into account along with the other areas in which the Commonwealth makes contributions The matter is currently receiving consideration.

page 1626

QUESTION

VIETNAM

Senator CAVANAGH:

– I ask the Minister representing the Prime Minister whether he has studied the results of the Roy Morgan Australian public opinion poll conducted in April this year on Vietnam which revealed that 48 per cent of those interviewed were in favour of Australia’s complete withdrawal while 37 per cent were in favour of Australian forces remaining in Vietnam? In view of this clear indication of Australian public opinion will the Government act accordingly and withdraw Australian forces from this unendorsed conflict?

Senator Sir KENNETH ANDERSONThe honourable senator links his question and his sentiments to an opinion poll. Yes, I have seen the results of some opinion polls. I saw one recently which indicated that if an election were held now the Government would belt the ears off the Opposition. I do not know whether that is the test. The fact of the matter is that Senator Cavanagh has an opinion-

Senator Cavanagh:

– This is the Australian opinion, not mine.

Senator Sir KENNETH ANDERSON:

– 1 know that, but the fact is that we all have our own views about opinion polls. I think the question would have been better presented had the honourable senator left out that part of it, because some of us believe in them to a certain degree and others do not believe in them at all. In view of the last one in relation to a political matter I rather think that the Labor Opposition would not approve of them either.

Senator Cavanagh:

– What is your attitude to Vietnam as a result?

Senator Sir KENNETH ANDERSONMy attitude to Vietnam is that I believe the Government’s policy has been clearly denned. It has not changed in terms of our commitment there. Therefore there is nothing that Senator Cavanagh does not appreciate and is not aware of in relation to the Government’s intentions in respect of Vietnam.

page 1627

QUESTION

TROOP WITHDRAWALS

Senator MURPHY:

– Following the question by Senator Cavanagh. I ask: Is the Leader of the Government in the Senate aware of the withdrawal from Vietnam of a New Zealand artillery battery? Is he aware also of the withdrawal of some of the forces of the other countries which have been in Vietnam since the Government entered into this commitment? Will he tell us, because so far we have not been told, to whom the Australian Government made this commitment he speaks about?

Senator Sir KENNETH ANDERSONYes, I am aware of the New Zealand withdrawal. I am also aware of Australian helicopter squadrons coming out at almost the same time. The final question the honourable senator asked takes us back to the old argument that we have had so many times in this place and I do not think there is any merit in recommitting it again at question time. There has never been any doubt in the view of the Government as to the purpose for which we went into Vietnam, and I do not believe that there will be any change in its view. Should the necessity arise we will make a further statement on it. We are bringing troops out of Vietnam. A ministerial statement was made some months ago in relation to a battalion that is coming out of Vietnam. It is a highly political argument which I suggest is not appropriate for question time.

page 1627

QUESTION

MEDICAL BENEFITS SCHEME

Senator MILLINER:
QUEENSLAND

– I direct my question to the Minister for Health. I ask: Stripped of all verbiage and lengthy explanation, does the agreed increase in general practitioners’ fees in fact mean that contributions to the medical benefits scheme will increase by amounts varying between 5c and 10c a week in New South Wales, Victoria and Western Australia, and between 6c and 1 lc a week in Queensland.

Senator GREENWOOD:
LP

– The answer to the honourable senator’s question, as I understand it, is yes.

page 1627

QUESTION

CIVIL AVIATION

Senator WRIEDT:

– My question is directed to the Minister for Civil Aviation. I refer to the question I asked earlier. Will the Minister give an assurance that he will issue immediately the instruction I suggested in my earlier question?

Senator COTTON:
LP

– I will give no assurance about anything until I have checked the facts and found out what they are all about. If the facts, when they are checked, demonstrate the need for an instruction, it will be given.

page 1628

QUESTION

SENATE SELECT COMMITTEE ON SECURITIES AND EXCHANGE

Senator O’BYRNE:

- Mr Deputy President, it was my intention to ask this question of the President when he was in the chair but I direct it now to you. I feel that [ should draw attention to an advertisement appearing in the Press which states:

Prompt private transcripts of Senate Select Committee on Securities - Canberra hearing.

The advertisement gives a post office box number. What procedure is followed for this evidence to be made available to such people for sale? Is any assistance given to people engaged in this activity by the Senate or Hansard? Will the President give a ruling on the propriety of such an advertisement purporting that such evidence would be available before perusal by the witnesses for errors and/or corrections?

The DEPUTY PRESIDENT (Senator Bull) - I will see that the President gets a copy of that question and in due course the honourable senator will receive an answer.

page 1628

QUESTION

PAPUA NEW GUINEA

Senator KEEFFE:

– My question is directed to the Minister representing the Minister for External Territories. Is the Minister aware that a 9-year-old New Guinean boy has been sentenced to 2 years’ imprisonment in the infamous Bomana Prison after conviction on an alleged breaking and entering charge? In view of the fact that there is no Territory rehabilitation centre for juveniles, will the Minister inform the Parliament whether he is prepared to intervene immediately to ensure that the lad concerned is released and returned to the care of his family?

Senator WRIGHT:
LP

– I do not know whether Senator Keeffe was in the chamber earlier today during question time when I was asked almost the same question. I then informed the Senate that 1 was aware of the conviction, and I said that I would refer any suggestions for improved conditions of imprisonment to the Minister for External Territories for immediate consideration.

page 1628

QUESTION

PETROL PRICES

Senator BISHOP:

– My question, which is directed to the Minister representing the Attorney-General, follows the one Senator

Rae asked about petrol prices in South Australia. Is it a fact that the South Australian Government is the only government in Australia maintaining a price control administration to protect consumers from exploitation? ls the Minister aware that the Commonwealth Government, through the Minister concerned, and other State governments accept the procedures and examinations of the South Australian Prices Commissioner in setting the petrol prices to apply throughout Australia, and that the Minister in charge of this place often refers to that fact in answering questions about petrol prices?

Senator GREENWOOD:
LP

– My understanding is that South Australia is the only State that maintains a prices commissioner and a prices commissioner structure, although there are fixed prices for some commodities in some other States of the Commonwealth. With regard to petrol, I understand that the position is that the South Australian Prices Commissioner fixes the retail price of petrol and in the other States the major petrol companies voluntarily follow the price that is set by him. T would imagine, however, that if the reported statements of the Premier of South Australia are correct he must have some dissatisfaction with the prices that are fixed for petrol in South Australia. Otherwise, it is difficult to understand why he should seek to deny to the poor motorists of South Australia the opportunity to obtain cheaper petrol from those who are prepared to sell it to them. All one can say is that, if the Premier is correctly reported, it is a curious attitude for the Labour Party to adopt.

page 1628

QUESTION

CHARTER FLIGHTS

Senator WOOD:
QUEENSLAND

– I ask the Minister for Civil Aviation: Is it not a fact that the answer he gave to Senator Murphy in regard to charter flights by Qantas Airways Ltd related to charters by Qantas on a group basis, which means that people have to comprise a group of a certain number in order to enjoy those charter rates? Is it not a fact that the charter rates that Senator Murphy mentioned are those paid by individuals who at present book on and join flights at Bangkok or Singapore because such charter flights are not allowed into Australia? In view of reports this morning in relation to an application for the starting of charter flights from Australia, in which it was stated that the interests of Qantas apparently were regarded as being paramount, would it not be right to take the attitude that the interests of the individuals in Australia are paramount to those of Qantas and also that the interest1: of Australia itself are paramount to those of Qantas, and that the present restriction on charters has a detrimental effect on this country’s tourist industry in which so many people find employment?

Senator COTTON:
LP

– lt is a fact that the Qantas charter flying would take the form of a full aircraft load at a discounted fare of 55 per cent of the full fare and, in the case of groups of 40 people or more, at a discounted fare of 66 per cent of the full fare. Let me repeat that the Qantas fare to London in this area is $682 and not the full economy class fare that is often quoted. Senator Wood speaks about the interests of Qantas being paramount to the interests of Australia. This is something that I am not prepared to accept. Qantas is owned by the Australian people. Therefore, surely the interests of the Australian people are served by making sure that Qantas is kept going effectively. Qantas now has an investment of about $260m in total assets and of that amount the Australian people have put in about $40m. Over the last 10 years Qantas has been profitable in most years; in one there was a pilots’ strike. The airline has done a great deal for Australia and it will do a great deal more.

The interests of tourism are not set to one side by Qantas, operating as it does. What we have in mind, first of all, is to give priority to the scheduled international carriers which are licensed to come to Australia and licensed to go out of Australia. We do this because Qantas has comparable rights in other countries. In addition, we believe that we have satisfied the charter market in this country as it has presented itself to us. Qantas is not unmindful of the opportunities in the charter business. It has been studying this area very carefully, as one would expect. We have a concern that people who pay a lot of money to fly out of Australia are able to do so on an airline which will carry them to their destination and, so far as possible, carry them safely.

page 1629

QUESTION

QANTAS AIRWAYS LTD

Senator MURPHY:

– My question is addressed to the Minister for Civil Aviation. Leaving aside the question of charters and people organising themselves into a group and having to go through all the nonsense associated with that, will the Minister tell us what he is doing to ensure that the ordinary member of the public can get overseas travel at reasonable rates? What has he done to see whether the high rates can be pulled down? Is it correct that the fares per passenger mile across the Pacific are the highest, or among the highest, in the world for a flight of any length? Will he tell us also whether it is true that those versed in the economics of air travel say that because of the long hauls across the Pacific the fares ought to be the cheapest in the world? Can the Minister tell us what is being done by him to alter the state of affairs which is rapidly resembling that of the electrical appliance business where it is only the sucker who pays the full list price for an appliance, just as it is the sucker who pays the full overseas air fare? What is the Minister doing to enable the ordinary person to buy his ticket for overseas travel at a reasonable price without having to go through all the problems of charters, the formation of ethnic groups or matters such as that?

Senator COTTON:
LP

– One thing that I am not doing is seeking leave of the Senate to go and manage day by day Qantas Airways Ltd with its 12,000 employees. As I have said, quite factually, Qantas is checking to see what can be done to make the fare paying situation for Australians better than it now is. Qantas approached the International Air Transport Association to see whether it could get greater concessions than it finally received in respect of group travel. It is still true that one can fly by charter with Qantas and that as part of a group the fare to London is $682 - not $1,130. That is a substantial discount. I do not think I or Qantas can be expected to follow day by day (he price cutting ramifications of operators who make all sorts of claims but who, in many instances, leave their passengers stranded. I am trying to see to it that Qantas gets the best opportunity for business, because the Australian people own Qantas; that so far as possible it operates on a reasonable pricefare arrangement, which it seeks to do; that it investigates new opportunities, which it is doing; and that it endeavours to keep its business economically viable and operating, which it is doing. I cannot go beyond that at present, but I assure the honourable senator that any new idea, scheme or proposal that anybody in the Qantas scene has to improve its business for the Australian people, who own the airline, for the fare paying passengers and for the operations ofthe company, will always have my wannest support and my close attention, and when such schemes, ideas or proposals come up I devote myself to them.

page 1630

QUESTION

WILDLIFE CONSERVATION

Senator MULVIHILL:

– Will the Minister representing the Minister for Education and Science, who is administratively responsible for the Commonwealth Scientific and Industrial Research Organisation, consider holding summit talks with the various State Ministers responsible for wildlife conservation with a view to evolving a uniform policy to eliminate aerial baiting of bushland with the poison1080?

Senator WRIGHT:
LP

– The use of the term summit talks’ somewhat intrigues me. If the question is whether or not 1 will ask the Minister for Education and Science to suggest to the next meeting of conservation Ministers that they list this item for the agenda, the answer is yes.

page 1630

QUESTION

LAND PRICES

Senator FITZGERALD:

– My question is directed to the Minister representing the Minister for Housing. Will the Commonwealth confer with the States to end the racketeering that is taking place in land prices, particularly as Commonwealth finance plays an important part in home building? Is the Minister aware that the Sydney Press, at present, is exposing this dishonest practice, pointing out that a handful of multi-million dollar development companies are carving up what is left of Sydney’s home building land? No doubt a similar position exists in other States. I ask the Minister: With a view to protecting thousands of home seekers throughout Australia, will the Commonwealth Government act with the States in an attempt to destroy this pernicious practice which affects mainly the young marrieds and the new citizens of this country?

Senator WRIGHT:
LP

– The honourable senator can be assured that the Government shares the concern, which is evident in his question, about excessive land prices for suburban land. It is not always realised, though, that the modern methods of subdivision requiring that the developer place streets, sewerage and water at the disposal of the purchaser increase the cost of those amenities to the land. I am not aware of the investigation that is being conducted by the Sydney Press except in a general way and I am certainly not in a position to be satisfied that there is any cornering of land by powerful subdividers. I cannot dispute it, but I am not satisfied. With regard to the general problem, I refer the honourable senator to a recent statement by the Minister for Housing, who has assured the Parliament that this matter is under his immediate consideration.

page 1630

QUESTION

NATIONAL SERVICE

Senator KEEFFE:

– My question is directed to the Ministers representing the Minister for Labour and National Service, the Minister for Defence and the Minister for the Army. I remind them that when I spoke in this Chamber on 7th May about the problems of a national service trainee, Private X, who is an American citizen endeavouring to transfer to the American Navy, I offered to supply the file to each of the Ministers so that further investigations could be carried out. To date, no Minister has asked for the file. Does this indicate that the Ministers or the Government intend no further investigation of the case of Private X?

Senator WRIGHT:
LP

– The representations of the honourable senator, which I think he said were made on 7th April -

Senator Keeffe:

– Last Friday 7th May.

Senator WRIGHT:

– That relieves my anxiety a little. I would have been somewhat anxious if we had been waiting since 7th April to consider a matter of this kind. I can assure the honourable senator that his original representations and his repetition of them today will receive immediate consideration.

page 1630

QUESTION

COMMUNIST CHINA

Senator CAVANAGH:

– In the absence of the Minister representing the Prime Minister I address my question to the Minister representing the Minister for

Foreign Affairs. Has the Minister been advised of a resolution carried at the weekend conference of the South Australian Young Liberal movement supporting Australia’s diplomatic recognition of Communist China and support for Communist China’s application for admission to the United Nations? Further, has the Minister studied the statement made by Mr W. R. Crocker, a retired Government servant who has held the position of Australian Ambassador to 11 countries over the past 13 years, that Australia should establish normal diplomatic relations with Communist China? In view of that statement by such an enlightened diplomat, supported by a resolution of the politically biased Young Liberals of South Australia, will the Government reconsider its attitude to recognition of and diplomatic relationship with Communist China?

Senator WRIGHT:
LP

– The impatience of the Opposition is almost beyond belief. I have not noticed the resolution of the South Australian Young Liberals to which Senator Cavanagh referred. I respect their viewpoint, and their viewpoint on that subject. I think it is a tribute to the youth of our political Party that members of the Young Liberal movement are capable of debating such a subject according to their judgment. I saw various references to Mr Crocker’s views on this subject published in many newspapers at the weekend. AH I wish to say is that that man’s views are entitled to consideration, because of his experience and standing, along with the advice of other diplomatic advisers available to the Government. His views, of course, will not be neglected. With regard to the Government’s attitude, Parliament was assured in the first statement on foreign affairs made by the Minister for Foreign Affairs, Mr Bury, that the Government had noted the trend in matters affecting, firstly, the admission of Mainland China to the United Nations and, secondly, recognition of that country. The Government assured the Parliament that its attitude to each of those questions is kept under review. It would be inappropriate for me or for anybody else in this place to go beyond that at question time in relation to this matter of policy.

Senator Keeffe:

– How long before it will be reviewed?

Senator WRIGHT:

– Maybe an indefinite time.

page 1631

QUESTION

TAXATION

Senator POKE:
TASMANIA

– As the Minister representing the Treasurer is not in the chamber, I ask some other Minister to bring this question to the notice of the responsible Minister: On Tuesday of last week Senator Devitt asked the Minister representing the Treasurer to have a detailed examination made with a view to providing a greatly increased zone allowance for residents on the west coast of Tasmania. If the detailed examination requested by Senator Devitt is undertaken, will the Minister extend the inquiry to cover the whole of Tasmania with a view to increasing that area of the State in which residents now receive the zone B concession allowance to take in that area in which residents receive the zone A concession allowance? Will other areas of Tasmania be favourably considered for the zone B allowance because of the peculiarities and disadvantages suffered by the State due to the various transport problems?

Senator WRIGHT:
LP

– In the unavoidable absence of Senator Sir Kenneth Anderson, who is dealing with other important parliamentary duties, I wish to say that the Treasurer of course will give consideration to the suggestions put forward by Senator Devitt and Senator Poke. I would add that I think a suggestion of that sort would attract much more serious attention if it were accompanied by a statement setting out in substance the reasons for which it is supported.

page 1631

QUESTION

ABORIGINALS

(Question No. 1044)

Senator KEEFFE:

asked the Minister representing the Minister for the Interior, upon notice:

Is segregation being practised at Wave Hill Station in the Northern Territory, in that white and Aboriginal stockmen are being compelled to eat at different tables.

Senator COTTON:
LP

– The Minister for the Interior has provided the following answer to the honourable senator’s question:

I understand that, when working in stock camps on Wave Hill Station, Aboriginal and nonAboriginal stockmen share the same messing arrangements, but that separate facilities are provided at the station headquarters.I am informed that the Aborigines have expressed a preference for this arrangement.

page 1632

QUESTION

SOFT DRINKS

(Question No. 1061)

Senator MULVIHILL:

asked the Minis ter for Health, upon notice:

How many breaches of health requirements in respect of the manufacture of soft drinks have been detected in the past 5 years in the territories for which the Commonwealth Government is administratively responsible; how many prosecutions were there as a result, and who were the offenders.

Senator GREENWOOD:
LP

– The answer to the honourable senator’s question is as follows:

During the past 3 years 15 complaints of infringements of health requirements in respect of the manufacture of soft drinks were reported in the Australian Capital Territory. Fourteen complaints involved foreign bodies in the bottles and 1 complaint was in relation to a dirty bottle. In the Northern Territory there were 6 similar complaints during the 5 year period, all cases involving foreign bodies in the bottle.

All complaints were considered but there were no prosecutions in either the Australian Capital Territory or the Northern Territory.

page 1632

QUESTION

POLICE GUARDS

(Question No. 1117)

Senator KEEFFE:

asked the Minister representing the Minister for the Interior, upon notice:

  1. What is the total cost to date of the police guards placed on (a) the Russian Embassy: (b) the South African Embassy; and (c) all other embassies and similar institutions in the Australian Capital Territory.
  2. What is the current weekly cost of police guards on (a) the Russian Embassy; (b) the South African Embassy; and (c) all other embassies and similar institutions in the Australian Capital Territory.
Senator COTTON:
LP

– The Minister for the Interior has provided the following answer tothe honourable senators question:

  1. The total cost to 2nd May 1971 of the police guards on embassies and similar institutions in the Australian Capital Territory is $173,506. Separate costs are not readily available.
  2. Current weekly costs including salaries, overtime, penalty rates and a special allowance are (a) Soviet Embassy, including ambassador’s residence - $3,340; (b) South African Embassy - $1,720; (c) other embassies and residences $2,220.

page 1632

QUESTION

PARLIAMENT HOUSE EXTENSIONS

(Question No. 883)

Senator DONALD CAMERON:
SOUTH AUSTRALIA

asked the Minister representing the Prime Minister, upon notice:

  1. How much will the extensions on the Senate side of Parliament House cost, including any other alterations proposed in the near future.
  2. Did the Government consider the economic situation when proceeding with this expenditure.
Senator Sir KENNETH ANDERSON:

The Prime Minister has provided the following reply to the honourable senator’s question:

  1. A contract for extensions to the Parliament House was let in late 1970 for approximately $2m. Of this sum, approximately$1m will be required for construction of the western or Senate wing and directly associated works.
  2. In the light of the economic situation, the Government has decided to defer the construction of the front east and front west elements of the extensions.

page 1632

QUESTION

OIL SPILLAGE

(Question No. 1074)

Senator MULVIHILL:

asked the Minis ter representing the Minister for Shipping and Tranport, upon notice:

  1. What is the line of authority between the Department of Shipping and Transport and State Harbour/Maritime Authorities as regards methods to be used in clean-up operations following an oil spillage.
  2. Does the Commonwealth Government, through the Department of Shipping and Transport, have specific authority to determine what preparation, either detergent or dispersant, is used in oil spillages.
  3. What are the various types of detergents/dispersants recommended to the Stale Authorities; what changes has the Department made in its recommended list of such preparations to State Authorities in the past 5 years; and what are the band names of such preparations stockpiled by the various State Authorities at the behest of the Commonwealth.
  4. Have any of the State Authorities ignored the advice of the Department of Shipping and Transport and procured their own choice of detergents or dispersants.
  5. Does the Department of Shipping and Trasnport have any liaison with the Department of the Navy on what preparations are used in clearing oil spillages.
Senator COTTON:
LP

– The Minister for Shipping and Transport has provided the following answer to the honourable senator’s question:

  1. Clearly enough, it is not correct to speak of a line of authority between Commonwealth and State Departments. Commonwealth advice and assistance is automatically available to a State authority which might have the responsibility for dealing with an oil spillage. However, the whole question of both the procedures and the methods for this kind of operation is presently under discussion between Commonwealth and States.
  2. The Commonwealth Department of Shipping and Transport specifies the materials and equipment to be used in an operation which falls to the Commonwealth’s responsibility. As indicated, its advice is available in all other cases.
  3. and (4) The Commonwealth/State discussions will include the matter of determining capability specifications for all materials which could be used. These will not be formulated by trade name. The question of stockpiling and its cost is likewise under discussion.
  4. Yes. Such liaison will, of course, continue.

page 1633

QUESTION

NATIONAL BIOLOGICAL STANDARDS LABORATORY

(Question No. 1093)

Senator WEBSTER:
VICTORIA

asked the Minister for Health, upon notice:

  1. Is the National Biological Standards Laboratory established and operated for the benefit of the Australian public.
  2. Does the Government consider that the Laboratory contributes significantly to the benefit of the Australian public.
  3. Is the Federal Government under the National Health Scheme, supplying or in any way contributing to the purchase of any chemical product which has been proved a failure by tests carried out by the National Biological Standards Laboratory?If so, what are those products.
  4. What action follows the finding by the Laboratory that a chemical product does not meet the claims made with respect to the product by the manufacturer.
Senator GREENWOOD:
LP

– The answer to the honourable senator’s question is as follows:

  1. Yes.
  2. Yes.
  3. No.
  4. The annual Report of the Director-General of Health contains a summary of all samples, including products on the Pharmaceutical Benefits List, tested by the National Biological Standards Laboratory during the previous year. The number of failures, together with a break-up thereof is also provided.

The samples are examined under the provisions of the Therapeutic Goods Act 1966 and appropriate action is determined in the light of the confirmed failure. Such failures which are considered to constitute a public health hazard, namely, safety, contamination or misidentification, sterility, potency or disintegration are removed from the Pharmaceutical Benefits List for a period of 12 months with relisting dependent upon prior satisfactory testing by the National

Biological Standards Laboratory. In certain cases recall of the product throughout Australia may be undertaken.

With other failures, regarded as minor in nature and consisting mainly of labelling deficiencies the manufacturer is given the opportunity to correct the reported anomaly.

page 1633

QUESTION

HEART DISEASE

(Question No. 1097)

Senator WEBSTER:

asked the Minister for Health, upon notice:

Is there any conclusive evidence known to the Minister or the Department of Health that the consumption of butter can add to the risk which the average citizen bears of incurring heart disease.

Senator GREENWOOD:
LP

– The answer to the honourable senator’s question is as follows:

No.

page 1633

QUESTION

POLY-UNSATURATED MARGARINE

(Question No. 1098)

Senator WEBSTER:

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

  1. In which States is there a shortage of polyunsaturated margarine.
  2. Is there a shortage of this excellent product in the Australian Capital Territory.
Senator DRAKE-BROCKMAN:
CP

– The Minister for Primary Industryhas provided the following answer to the honourable senator’s question:

  1. I am aware that from time to time individual people may have difficulty in obtaining specific brands of polyunsaturated margarine in their local shops but I have not received representations from consumers, shopkeepers or distributors generally in any State about a shortage of polyunsaturated margarine.
  2. A check made on Friday, 30th April 1971 revealed ample supplies of a number of brands of polyunsaturated margarine in the major food stores in Canberra.

page 1633

QUESTION

DAMPIER ARCHIPELAGO

(Question No. 1111)

Senator MULVIHILL:

asked the Minis ter representing the Minister for the Interior, upon notice:

  1. What islands of the Dampier Archipelago are defined as Commonwealth Territory.
  2. Are such islands defined as wildlife sanctuaries.
Senator COTTON:
LP

– The Minister for the Interior has provided the following answer to the honourable senator’s question:

  1. and (2) None of the islands in the Dampier Archipelago is a Territory of the Commonwealth. Apart from about 400 acres on Legendre Island held by the Commonwealth for lighthouse purposes, the land comprised in the group of islands is understood to be unreserved Crown land of the State of Western Australia.

page 1634

QUESTION

SINKING OF THE ‘HANNA

(Question No. 1129)

Senator WILLESEE:

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

  1. Did two Commonwealth marine surveyors in Adelaide declare the vessel Hanna unseaworthy and issue the ship with a temporary certificate of 60 days duration in order that it might proceed, unladen, to a docking port for substantial repairs; if so, did the Hanna then ignore the need for repairs and load a full cargo of ilmenite in Bunbury.
  2. Did the Bunbury Harbour Master then inspect the ship and declare it unseaworthy and have his opinion confirmed by another Commonwealth marine surveyor who travelled from Fremantle to inspect the ship.
  3. Did the Hanna obtain a clearance to leave Bunbury and did she subsequently sink in relatively fine weather conditions on 4th March 1971.
  4. Was the Hanna and its cargo insured; if so, for what sum.
  5. Will the Minister conduct a full and open inquiry into the circumstances leading to the sinking of the Hanna.
Senator COTTON:
LP

– The Minister for Shipping and Transport has provided the following answer to the honourable senator’s question:

  1. The vessel ‘Hanna’ was registered in Panama and held current Safety of Life at Sea Convention certificates issued by the American Bureau of Shipping Classification Corporation on behalf of the Government of Panama. Under the provisions of the 1960 Safety of Life at Sea Convention, the Government of a country that authorises a Classification Corporation to issue certificates on its behalf fully guarantees the completeness and efficiency of the inspection and survey of the Classification Corporation.

The vessel was inspected prior to proposed grain loading in Port Pirie, South Australia, by surveyors of the Department of Shipping and Transport, who required certain structural defects in the vessel to be repaired under the supervision of the American Bureau of Shipping - the Classification Corporation which the Government of Panama had authorised to issue certificates on its behalf. After repairs had been carried out, the representative of the American Bureau of Shipping issued ‘Hanna’ with a certificate which permitted the vessel to continue to carry cargo provided it underwent a complete survey within 60 days.

  1. The vessel proceeded to Bunbury, Western Australia, where it subsequently loaded ilmenite sand. The Harbour Master at Bunbury inspected the vessel on behalf of the Commonwealth and found holes in the main deck and wing tank hatch coamings. A Department of Shipping and Transport surveyor also inspected the vessel and, in conjunction with the Harbour Master, insisted that certain repairs be carried out, under the supervision of the American Bureau of Shipping. Subsequently the American Bureau of Shipping local representative issued a report to the effect that the repairs had been satisfactorily carried out and confirmed the view of his counterpart in South Australia that the vessel be ‘retained in class’, that is in effect, be permitted to carry cargo, provided it was surveyed within 60 days from the date of the American Bureau of Shipping representative’s inspection in South Australia.
  2. In the circumstances outlined above, and because the repairs required by the Commonwealth surveyors had been carried out, the Department of Shipping and Transport considered it should take no further action at the time as it would be overstepping its authority if it detained a vessel of another country when the surveyors appointed by the Government of that country (in the case of ‘Hanna’; the local representatives of the American Bureau of Shipping) were fully convinced that the vessel was in a satisfactory condition to undertake a voyage.

The vessel is known to have been abandoned allegedly in a sinking condition, about half way between Australia and South Africa some nine days after departing from Bunbury on 23rd February 1971. There were no casualties.

  1. It is not the practice for owners of foreign vessels loading cargo in Australia to make known to the Department such matters as the nature or extent of any insurance cover that may have been taken out. Matters such as these are not the concern of the Department from the point of view of the Commonwealth fulfilling its obligations under the Safety of Life at Sea Convention.
  2. The question of an open enquiry into the abandonment of ‘Hanna’ in the Indian Ocean is clearly one for the Panamanian Government, and it would be untenable for the Commonwealth Government to consider intervening in a matter that is by international law and practice the concern of another Government. The Commonwealth has, however, expressed in writing to the American Bureau of Shipping and the Panamanian Government its deep concern in very strong terms about this matter and is awaiting replies before considering what further action may be necessary.

page 1634

AUSTRALIAN NATIONAL UNIVERSITY COUNCIL

Motion (by Senator Wright) - by leave - agreed to:

That in accordance with the provisions of section 11 of the Australian National University Act 1946-67 the Senate elects Senators Murphy and Rae to be members ofthe Council of the Australian National University for a period of 3 years from 1st July 1971.

page 1635

VICTORIA GRANT (SHEPPARTON PRESERVING COMPANY LIMITED) BILL 1971

Bill received from the House of Representatives.

Standing Orders suspended.

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

Second Reading

Senator DRAKE-BROCKMAN:
Minister for Air · Western Australia · CP

– I move:

That the Bill be now read a second time. The purpose of this Bill is to provide financial assistance to the State of Victoria in order that the State can assist the Shepparton Preserving Co. Ltd in the matter of the company’s payments to growers for fruit delivered to the company. Honourable senators will be aware from public reports of the extent of the difficulties that the company has encountered over the last 2 years, extending to the company’s inability to finance in full payments to growers for fruit delivered in the 1970 season. Since the company is a major fruit cannery in the Shepparton region these difficulties, without some degree of alleviation, would have serious consequences for the stability of the industry, the welfare of growers and the welfare of the Shepparton area generally.

In these circumstances, the Government of Victoria approached the Commonwealth Government for financial assistance, and the Commonwealth Government acceded to the request. The agreement between the Commonwealth and the State relating to the provision of this assistance and the terms of repayment is set out in the Schedule to the Bill. Clauses 3 and 4 of the Bill, and the agreement, have a retrospective application to the 31st December last year. It was at that point of time that a crisis siuation had developed in the affairs of the company in respect of payments to growers. To meet this, and following urgent representations from the Victorian Government, the Commonwealth Government made available to the State at that stage $4m of the agreed assistance. I note from recent public statements by the company authorities that, despite the losses of the last 2 years, the directors anticipate an early return to profitable trading. I commend the Bill to honourable senators.

Debate (on motion by Senator Poyser) adjourned.

page 1635

TRADE PRACTICES BILL 1971

Bill received from the House of Representatives.

Standing Orders suspended.

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

Second Reading

Senator GREENWOOD:
Minister for Health · Victoria · LP

– I move:

The primary purpose of this Bill is to control the practice known as resale price maintenance. The provisions for this purpose are to be inserted into the Trade Practices Act 1965-1969. The opportunity has been taken to make one or two other amendments to that Act which will require the terms and conditions of appointment of the members of the Trade Practices Tribunal and of the Commissioner of Trade Practices to be prescribed by regulation rather than determined by the GovernorGeneral or the Attorney-General.

Resale price maintenance is a restrictive trade practice in the sense that it operates to restrict competition in the re-selling of goods. It is a practice by which a manufacturer or wholesaler of goods - to whom, for the sake of convenience, I shall refer as the ‘supplier’ - stipulates a minimum price that must be charged on the resale of goods supplied by him. It is a practice that operates vertically in the distributive process as the goods pass in turn from manufacturer to wholesaler and from wholesaler to retailer. In this respect it is distinguishable from price-fixing agreements that are horizontal in the sense that they are between competitors on the same level of the distributive process. Section 35 of the Trade Practices Act already covers such horizontal agreements. But in its present form the Act does not cover, otherwise than incidentally, vertical price arrangements of the kind to which this Bill relates. The present position, therefore, is that an agreement between a group of manufacturers in accordance with which they agree that they themselves will not charge less than certain prices is examinable by the Trade Practices Tribunal at the instance of the Commissioner of Trade Practices and, if the agreement is determined by the Tribunal to be contrary to the public interest, it may be prohibited by appropriate restraining orders. But if a manufacturer acts independently of other manufacturers he is completely free, by engaging in resale price maintenance, to control the re-selling prices of the goods he supplies. In the result, there is a common retail price for the goods that must be charged by all retailers. However efficient a particular retailer may be, he cannot in these circumstances pass on the results of his efficiency to the consumer by a reduction in price. It can happen, moreover, that in such circumstances the manufacturer will find himself under strong collective pressure from the retailers to keep the minimum resale price at a sufficiently high level to enable even the less efficient retailers to operate profitably.

There is no need for me to remind the Senate that our economy is at present subject to strong inflationary pressures. To meet these pressures the Government is taking action in several areas. It has restricted spending in the public sector and, as announced recently, the Tariff Board will shortly begin a systematic review of tariffs. In addition, there is a need for more internal competition. There is a need to ensure that the prices of goods are keenly competitive. In saying this, however, I want to make it clear that I am not suggesting that the prices at present operating under resale price maintenance agreements are necessarily excessive. But I do believe that the practice tends to remove the incentive to sell goods cheaply and that, in general, the practice works against the objectives of efficiency which are so important if our efforts to resist the present inflationary pressures are to succeed.

In concluding that this Bill should be introduced the Government has taken into account the experience of other countries with resale price maintenance. Most countries with free enterprise economies have come to the conclusion that, in general, the practice is against the public interest, and they have followed up their conclusions by legislating to bring it under control. The United Kingdom enacted legislation for this purpose in 1964. Canada,

Japan, South Africa, France, the Netherlands, Denmark, Sweden, Spain, Norway and Finland have also enacted legislation with respect to the practice in the last 10 to IS years. The United States of America has had such legislation at the federal level for many years.

The degree of control provided for in the legislation varies from country to country. In some countries, for example, Canada, the practice is totally prohibited while the legislation of the United Kingdom makes provision for exemptions to be granted in respect of particular classes of goods and exemptions have in fact been granted in respect of 2 classes of goods. The experience of other countries has been that the circumstances in which resale price maintenance can be shown after full inquiry to be in the public interest are really few and far between. But honourable senators will, I think, agree that it is desirable that the Australian legislation should recognise that there may be goods of certain kinds in respect of which the -practice is desirable in the public interest, and that the legislation should enable exemptions to be granted where this can be established.

I turn now to the provisions of this Bill. In brief, the Bill makes it unlawful for a supplier to engage in the practice of resale price maintenance, but provides for this general prohibition of the practice to be subject to any exemptions that may be granted by the Trade Practices Tribunal in respect of particular kinds of goods. Clause 11 provides for resale price maintenance to be dealt with by a new Part of the Trade Practices Act, and this will be Part VIA. The various forms of conduct that will constitute resale price maintenance are set out in proposed subsection (2.) of section 66b. It will be noted that in each case it is conduct on the part of a supplier of goods with which the subsection is concerned. In brief, the forms of conduct mentioned in the sub-section are:

A supplier makes it known that he will not supply goods to a re-seller unless the re-seller agrees not to re-sell those goods below a price specified by the supplier;

A supplier induces a re-seller not to resell at less than a specified price goods supplied to the re-seller by the supplier;

A supplier enters into an agreement to supply goods to a re-seller, under which agreement the re-seller agrees not to resell the goods at less than a specified price:

A supplier withholds the supply of goods to a re-seller for the reason that the re-seller has not agreed to observe a specified minimum price or has sold goods at less than a specified minimum price;

A supplier withholds the supply of goods to a wholesaler for the reason that a retailer who obtains goods from the wholesaler, has not agreed to observe a minimum price specified by the supplier or has sold goods at less than a minimum price specified by the supplier; and

A supplier uses in relation to goods supplied to a re-seller a statement of price likely to be understood by the reseller a« the minimum resale price, for example, by having the retail price printed on a catalogue issued to the reseller.

Special provision is made in the Bill for mere recommendations of resale prices. In the absence of these provisions a recommendation would constitute an inducement and would on that account constitute the practice of resale price maintenance. This would, in the Government’s view, be going too far. So long as it is made quite clear that a recommendation is nothing more than a recommendation - that is, that there is no obligation on the part of the re-seller to comply with it - then there is no reason for treating it as resale price maintenance, and indeed there would be circumstances in which the re-sellers themselves would be unnecessarily inconvenienced if it were so treated. But on the other hand the legislation must plainly ensure that suppliers are not permitted to put any form of pressure on their re-sellers in the form of legally permissible recommendations. Proposed section 66c accordingly permits a recommendation to be made as to the resale price of goods provided that the recommendation is in writing and the document is endorsed with the words: ‘The price set out or referred to herein is a recommended price only and there is no obligation to comply with the recommendation’.

In regard to the withholding of supplies, one point that I wish to make clear is that it will not be resale price maintenance under the Bill unless the withholding is for the reason that the re-seller is refusing to conform to the supplier’s stipulations as to resale price. If, for example, the reason for withholding supplies is a doubt as to the credit-worthiness of the re-seller or some other substantial commercial reason, the provisions of this Bill will have no application. It will often be difficult, of course, to establish just what is the reason for a withholding of supplies. In recognition of this, provision is made in proposed section 66m for a rebuttable presumption of the reason to arise when the circumstances set cut in that section exist. Another provision to which I would draw the Senate’s attention is that contained in proposal subsections (2.) and (3.) of section 66d relating to what is commonly called loss leadering. A re-seller engages in loss leadering if he sells particular goods at a loss to attract custom or to promote his business in some way. The result of his so doing may well be to give the public an impression that the goods in question are of inferior quality, and this could be detrimental to the marketing prospects of the supplier. It is only fair that a supplier whose goods are being sold in this manner should be able to defend himself by withholding supplies from the re-seller in question, and the provisions to which I have referred make it clear that the supplier has this right.

In the Government’s view, it is undesirable that the control of restrictive trade practices should be achieved by unnecessary resort to the criminal law, and proposed section 66f accordingly excludes the possibility of criminal proceedings in respect of resale price maintenance. However, the fact remains that the Bill provides for the practice to be unlawful and provision is made in proposed section 90aa for it to be the subject of restraint by an injunction issued by the Industrial Court. An application for such an injunction will be able to be made by the Attorney-General, the Commissioner of Trade Practices or by a person who has suffered loss or damage by reason of the particular practice complained of. Such a person will, moreover, have a right to recover damages in respect of any such loss or damage. Finally, if the practice is provided for by an agreement, that agreement will, by virtue of proposed section 66g, be to that extent unenforceable.

I turn now to the provisions in proposed Division 2 for the granting of exemptions An application for such an exemption will be able to be made by a person who is supplying, or intends to supply, goods of the kind that are the subject of the application. Provision is made for the payment of a prescribed fee, having regard to the need for the Registrar to give public notice of the application in the ‘Gazette’ and such newspapers as are thought fit. The application will be determined by the Trade Practices Tribunal which will be constituted, except for matters of procedure, in the usual way, that is by a presidential member and 2 lay members appointed on the basis of their qualifications in industry, commerce or public administration. It will be open to a person other than the applicant who has an interest in an application for exemption to seek leave to intervene in the proceedings. Provision enabling him to do this is already contained in section 77 of the principal Act.

Before granting an exemption the Tribunal will need to be satisfied that, unless the exemption is granted, one or other of the detrimental effects set out in proposed subsection (2.) of section 66k will result, and that that detriment will outweigh any detriment that would result if the exemption were not granted. The detrimental effects set out in sub-section (2.) are virtually the same as those in the comparable provisions of the Resale Prices Act 1964 of the United Kingdom, and they cover the grounds upon which businessmen normally rely when attempting to justify resale price maintenance. In brief, they are: reduction in quality or variety of goods available; reduction in the number of retail outlets; increase in prices; danger to health, and, reduction in availability of after-sales services.

The Government believes that these criteria for justification in proposed section 66k will offer appropriate opportunities for exemption where it is in the public interest that an exemption should be granted. The criteria are, of course, much more specific than those in section 50 of the principal Act, which is applicable in the case of examinable agreements and practices. But proposed section 66k has been tailored specifically to the particular practice of resale price maintenance, whereas section 50 is applicable to a particularly wide range of agreements and practices.

The Bill does not provide for goods that are the subject of an application for exemption to be treated as exempt pending a determination of the application by the Tribunal. This is a matter to which the Government has given close thought, but the conclusion that it has reached is that, as this legislation is intended to assist in warding off the present inflationary pressures in the economy, provision for interim exemptions pending determination of applications would be inappropriate in that it would have the effect of unduly deferring the really effective date of the legislation. The Government also took into account that the cases in which it has been found in other countries that resale price maintenance is in the public interest constitute a very real minority of the total. Mindful, however, of the desirability of enabling industries to obtain determination of their applications for exemption as quickly as possible, the Government is giving close consideration to the procedures in accordance with which the Tribunal will deal with such applications.

Before concluding, Mr Acting Deputy President, I should like the Senate to know that the Government has the whole of the Trade Practices Act under close consideration with a view to ensuring that its provisions are as effective as possible. If the conclusion is reached that there is a need for further amendments of the Act, further legislation will follow in due course. But the Government has concluded that resale price maintenance should be dealt with at this stage, and not deferred until consideration of the rest of the Act has been completed. Mr Acting Deputy President, I feel confident that the provisions in this Bill will significantly improve our law to restrictive trade practices. I commend the Bill to the Senate.

Senator Kennelly:

– Mr Deputy President, in view of the nature of this legislation I am not too sure of the name of the Bill. Is it that ‘Mr Hawke Bill’ or some other Bill?

The ACTING DEPUTY PRESIDENT (Senator Wood) - Order! The name of this Bill is the Trade Practices Bill 1971.

Debate (on motion by Senator Murphy) adjourned.

page 1639

COMPENSATION (COMMONWEALTH EMPLOYEES) BILL 1971

Bill received from the House of Representatives.

Standing Orders suspended.

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

Second Reading

Senator GREENWOOD:
Minister for Health · Victoria · LP

– I move:

That the Bill be now read a second time.

The purpose of this Bill is to establish a new code of workers’ compensation for Commonwealth employees. At the outset I think 1 should mention that a Bill for this purpose, the Compensation (Commonwealth Employees) Bill 1970, was introduced in the House of Representatives by the then Treasurer on 19th March 1970, and at the conclusion of his second reading speech he indicated that the Government’s mind was not closed so far as the Bill was concerned and the Government stood prepared to consider on their merits suggestions for amendment during its passage.

In the event, representations about the Bill were received from the Council of Commonwealth Public Service Organisations, the Australian Council of Trade Unions and other sources and suggestions for amendment of the Bill were made by honourable members in the House of Representatives and honourable senators here during the debates on the Commonwealth Employees’ Compensation Bill 1970 which provided for increases in the monetary benefits payable under this legislation. All these suggestions were carefully considered by a committee of ministers and many of the suggestions have been adopted. In the light of the many amendments that would have been required in the Compensation (Commonwealth Employees) Bill 1970 to give effect to the many changes decided upon by the Government it was thought desirable for that Bill to be withdrawn and for a new Bill to be introduced incorporating the amendments.

The result is this Bill, which, when it comes into operation, will provide a generous and modern scheme of workers’ compensation for Commonwealth employees.

The Bill codifies and states in very much more detail than the existing Act the law concerning employees’ rights to compensation. It provides for many important changes in the scheme of compensation and the circumstances in which there is liability for compensation. One fundamental changes is that the Bill draws for the first time a clear distinction between the Commissioner for Employees’ Compensation and the Commonwealth and, in essence, the future role of the Commissioner, who will be appointed by the Governor-General, will be that of arbitrator between the employee and the Commonwealth as the employer. Another is that the Commissioner will no longer have any nonappealable powers when determining liability. That is to say, all determinations regarding liability made under the new legislation will be subject to reconsideration or review in another independent tribunal.

The Commissioner will have to maintain a register of delegations in force, the register being open for public inspection and delegates of the Commissioner will be required to make an oath or affirmation before proceeding to exercise the powers delegated. The Commissioner will have to make an annual report to the Minister and the Minister will be required to table the Commissioner’s annual report in the Parliament. Under the new provisions each party to a determination will be able to obtain equal access to all the relevant information that was before the Commissioner in reaching his decision. The range of documents to be supplied will include reports by medical practitioners and medical referees as well as reports by medical boards.

The existing arrangements for appeal against determinations of the Commissioner have been substantially changed and the time for the institution of such proceedings has been extended from 30 to 60 days. The Bill provides for the establishment of Commonwealth employees’ compensation tribunals. A tribunal will be constituted by a person appointed by the Governor-General and provision has been made for the constitution of such tribunals by persons residing outside Australia to deal with matters arising in connection with decisions on claims of officers stationed overseas or locally engaged overseas staff. A dissatisfied claimant will be able to have his claim reconsidered by a Commonwealth employees’ compensation tribunal or apply to a prescribed court for a judicial review of the Commissioner’s determination. The Workers’ Compensation Commission of New South Wales and the Industrial Court of South Australia will be the only prescribed courts in those States. An appeal from a decision of either a tribunal or a prescribed court will be able to be made on a question of law only and will be to the Commonwealth Industrial Court. Under the existing Act the award of costs in proceedings before a court is in the discretion of the court. This situation will remain under the new legislation insofar as applications for judicial review to a prescribed court are concerned. However, in proceedings before a Compensation Tribunal a claimant will never have to meet any part of the Commonwealth’s costs and a tribunal will have discretion which will permit a claimant’s costs, in whole or in part, to be awarded against the Commonwealth in all cases except those where the claimant institutes the proceedings and is neither wholly nor partly successful.

The new legislation is to apply or to be applied by regulations to additional classes of persons, not necessarily employees in the normal sense of that word, to whom the existing Act does not apply. These persons include holders of statutory offices, members of Commonwealth authorities, members of committees appointed by the Government and certain classes of volunteers. Examples of these volunteers are: Members of the Air Training Corps, the Australian Cadet Corps, the Naval Reserve Cadets and the Australian Sea Cadet Corps; volunteer bushfire fighters in the Australian Capital Territory; volunteers attached to units of the Civil Defence Organisation in the Australian Capital Territory and the Northern Territory; members of the repatriation volunteer workers groups serving in repatriation institutions; also persons who, under the control or direction of an officer of the Commonwealth, voluntarily take part in air or sea search and rescue operations conducted by the Department of Civil Aviation or the Department of Shipping and Transport. Provision has been made for determining a rate of pay for a voluntary worker who, when injured, was not in receipt of earnings from other employment.

Employment by the Commonwealth will include certain attendances by an employee at various places that are related directly or indirectly to his employment. That is, the employee will have the protection of the legislation when, for example, he is attending a university, school, etc., either at the request or direction of the Commonwealth or simply with the approval of the Commonwealth; or if he is attending a place for medical examination to obtain a medical certificate or medical treatment or undergo vocational training. The employee will also be covered when he is in attendance at his place of employment at various times, such as during an ordinary recess in his employment, or when he arrives early for work or is late leaving the employer’s premises after work; or at any time, apart from the periods to which I have already referred, when he is not required to engage in his employment, providing his attendance is reasonably incidental to his employment; and, lastly, at any place during a period when he is precluded by the terms of his employment from absenting himself from that place. The fact that cover will be provided in the last two sets of circumstances 1 have just described will be of particular interest to members of the defence force. They will be covered by the legislation at all times when they are in camp and, though not on duty, are not free to leave the camp, or when they are free to leave camp, if their being in camp is reasonably incidental to their employment.

In conjunction with the foregoing, the scope of the provisions covering injury while travelling to or from employment has been greatly extended. For employees, generally, the interpretation of a journey to or from employment has been extended to include one that would have been completed not more than one hour before commencing work or one commenced not more than I hour after ceasing work. Provision is made for extending this hour of grace in certain circumstances. Cover will also be provided for any journey to or from the place of employment during an ordinary recess in employment, for example, a lunch hour, as if the journey were one to or from the employment. Also included are new provisions to cover the special situation of servicemen, employees living in temporary camps provided by their employer and a person travelling to or from a pick-up centre when the Commonwealth was his last employer. The Commissioner will no longer have a non-appealable power in relation to a travel case involving a substantial interruption or deviation during a journey to or from the employment.

The Bill provides for compensation for injury whether the injury results from accident or not. The omission of any reference to ‘by accident’ in relation to an injury has necessitated the inclusion of a provision to exclude liability for intentionally self-inflicted injuries. At the same time the expression ‘injury’ is defined so as to exclude the consideration of any disease cases under the injury provisions of the Bill. Liability in respect of the contraction or the aggravation, acceleration or recurrence of a disease will have to bc determined only under the provisions relating to diseases. However, when liability under those provisions has been established for the purposes of payment of compensation the disease is deemed to be a personal injury and will attract the same compensation payments as a persona] injury. Under the Bill a disease no longer has to be a disease due to the nature of the employee’s employment by the Commonwealth to attract compensation. It will be sufficient if employment by the Commonwealth is a contributing factor to the contraction of a disease or to the aggravation, acceleration or recurrence of a disease, whether or not the disease was contracted or the aggravation, acceleration or recurrence occurred in the course of the employment. It might also be noted, in respect of both injury and disease cases, that the death, or a disfigurement, incapacity or disablement, of an employee or a loss suffered by an employee, will be deemed to have resulted from an injury to the employee or from a disease contracted by or suffered by an employee, if the injury or the disease contributed to the death of the employee or to a disfigurement, incapacity, disablement or loss suffered by him. The disease provisions have been further liberalised so as to allow prescription of diseases of an occupational nature in accordance with International Labour Organisation Conventions. These diseases will automatically be accepted as ones to the contraction or aggravation of which employment by the Commonwealth was a contributing factor.

Sitting suspended from 1 to 2.1S p.m.

Senator GREENWOOD:

– The Compensation (Commonwealth Employees) Bill provides for new levels of existing monetary benefits. The weekly rate of compensation for an employee without dependants is being increased from S3 1. 80 to $35 and, if an employee has dependants, that amount will be supplemented by an additional $8.50 for a dependent wife or female and $5 for each child, in lieu of the existing dependants’ allowances of $7.70 and $2.80, respectively. The basic lump sum death benefit, to which other lump sum benefits are related, is being increased from $12,000 to $13,500 and the minimum payment for a dependent child of a deceased employee increased from $280 to $500. The funeral benefit is being increased from $120 to $300. By virtue of the amendments that will be effected by Part VIII of this Bill to the existing legislation, that is, the Commonwealth Employees’ Compensation Act 1930-1970, these increases in rates will apply from the date on which this Bill receives the Royal Assent. Some other changes are being made in the existing legislation by that part of the Bill and it might be convenient to mention them here.

The provision in the existing Act that requires a reduced weekly rate of compensation to be paid to certain minors is being repealed as also is the special reduction provision currently applicable in some death cases when, before his death, the employee had received a lump sum payment. These changes are being made because these restrictive provisions are not being re-enacted by the Bill. At the same time the Third Schedule, which relates to specified injuries, is being repealed and a modified Schedule substituted which, in conformity with the table of losses in subclause (4) of clause 39 of the Bill, will eliminate the existing distinction between left and right upper limbs for lump sum compensation purposes. The effect of these amendments to the existing legislation is that employees will immediately, under the existing legislation as amended, receive certain of the benefits of the new code of compensation. It will, of course, take some little time for the necessary regulations and administrative arrangements to be made before all the provisions of the new code can be brought into effect. It is for this reason that the remaining substantive provisions of the Bill are to come into operation on a date to be fixed by Proclamation.

I turn now to some of the other improvements in the existing compensation code that will be effected by the Bill Provision will be made for the vocational training of incapacitated employees. The Commissioner is to be empowered to make arrangements with the Director-General of Social Services for the provision of such training in accordance with the principles observed by the Commonwealth Rehabilitation Service. While an employee is undergoing vocational training he will receive weekly compensation payments and, in addition, he will be eligible for training and living away from home allowances at the same rates and under the same conditions as these allowances are payable to Social Services beneficiaries who undergo such training. The Bill also provides that the benefits of the Commonwealth Rehabilitation Service, under Part VIII of the Social- Services Act, will, so far as they are capable of application, be available to employees undergoing vocational training. These provisions, taken in conjunction with the fact that medical treatment will in future include treatment and maintenance provided or arranged by the Director-General of Social Services through the Commonwealth Rehabilitation Service, will mean that a complete system of medical and physical rehabilitation and vocational training will be available for injured employees of the Commonwealth and Authorities of the Commonwealth. This is an important improvement in the scheme of compensation for those employees and it will, I think, place them in a more favourable position, so far as rehabilitation is concerned, than persons who are covered by the workers’ compensation legislation in the States.

There will no longer be a maximum amount payable by way of medical expenses and the existing restriction on payment of travelling expenses to obtain treatment is not being re-enacted. In addition, payment up to a limit of Si 50 in any one case will be made in respect of the provision or modification of certain aids, appliances and equipment that are not included as medical treatment but are reasonably necessitated by an injury. In this category would come the provision of access ramps in the house of an employee confined to a wheel chair, safety internal or external hand rails or grips in a bathroom, toilet, kitchen or bedroom, alterations of taps, catches, handles, door openings and fittings. Provision has also been made for meeting the cost of repair or replacement of artificial members and aids damaged or destroyed in an accident at work or during travel to or from work even though the employee himself is not injured. The Bill makes a number of improvements in relation to specified injuries in addition to that which I mentioned earlier, namely, the elimination of the existing distinction between left and right upper limbs. Several changes are proposed in the method of assessing the compensation for such injuries. For example, it will no longer be necessary, as the existing Act requires, for compensation paid for impairment of sight from one injury to be taken into account in calculating the compensation payable for further impairment of sight as a result of a later compensatable injury. There is also provision for an alternative basis of assessment when an injury results in the permanent, but partial loss of efficient use of a faculty or a part of the body. The present Act requires an assessment of the partial loss of the efficient use of a part of the body or of a faculty, other than sight, to be related to the employment at the date of injury. Under the Bill assessments in such cases will be based on the degree of diminution of use of the affected part or faculty, except when an assessment on the basis of loss of efficient use in relation to the employment at the date of injury will provide a greater benefit for the employee. Provision is also made for lump sum compensation for the loss of the power of speech, for the loss of the sense of taste or of smell, for the loss of the genitals or the permanent loss of capacity to engage in sexual intercourse and for severe and permanent facial disfigurement.

Honourable senators might note that the Bill provides for the use of a medical board in relation to claims for compensation in respect of facial disfigurement. However, consistent with the changes that are proposed concerning medical boards generally, there will be equal representation on a medical board for the Commissioner and the employee in facial disfigurement cases. A unanimous opinion of the members of a medical board whether or not an employee has suffered severe and permanent facial disfigurement will be conclusive evidence on this point, and if the members of the board are unanimous in the assessment of the amount to be paid, then that amount will be payable and there will be no appeal from the board’s assessment regarding the amount. However, if the members of the board do not give a unanimous certificate whether an employee has suffered severe and permanent facial disfigurement the responsibility will rest with the Commissioner to determine this question and the Commissioner’s decision will be subject to reconsideration or review in another independent tribunal. Also, if the members of a board are unanimous in the opinion that any employee has suffered severe and permanent facial disfiguration but they have divergent views about the amount of compensation to be paid, then it will be up to the Commissioner to determine what amount is payable and such a decision will also be subject to reconsideration or review in another independent tribunal. I should perhaps mention here that a somewhat similar procedure will operate where claims for loss of the sense of taste or the sense of smell are involved.

In relation to medical boards generally the Bill will give equal representation on a board for the employee and the Commissioner, by comparison with the existing Act under which a medical board may consist of more than two medical referees, with the employee having only one representative on the board. Also, the Bill stipulates that if all the members of the board give a unanimous certificate then, and only then, will a certificate of a medical board be final and conclusive evidence of the matters stated in the certificate. The further important qualification might also be noted, namely, that a unanimous certificate will be final and conclusive evidence only for the purposes of the Act and not for any other purposes, for example, in an action for damages. Under the present Act payment of a lump sum for a specified loss, or in redemption of weekly payments, terminates for all time the liability of the Commonwealth to pay weekly incapacity payments. This Bill makes provision for weekly payments to be resumed where, after a lump sum has been paid, an employee’s condition unexpectedly deteriorates so that he again becomes totally incapacitated and is likely to remain so indefinitely.

The existing Act provides for a maximum limit to the amount of compensation payable in certain circumstances in respect of any one accident. Under this Bill there will be no statutory maximum. As a corollary of this, in cases where an employee suffers multiple injuries in the one accident he will be eligible for payment of aggregate of the amounts specified for a number of individual losses instead of being restricted to receiving only the maximum amount stipulated for a specified injury. An example may make this clearer. Under the existing Act the loss of a hand and a foot in the same accident would attract lump sum compensation of $12,000, the statutory maximum, although the sum of the amounts for the individual injuries would be $15,600, comprising $8,400 for the hand an $7,200 for the foot. Under this Bill the amount of $17,550 will be payable in respect of the loss of a hand, $9,450, and the loss of a foot $8,100, sustained in the one accident, by comparison with the amount of $13,500 if the statutory maximum provision had been retained. The removal of the statutory maximum will also mean that, by comparison with the existing Act there will be no upper limit to compensation where an employee is permanently partially incapacitated for work.

While on the matter of partial incapacity payments I should mention that the Bill also provides for overtime, penalty payments and the like to be included in both the pre-injury and post-injury earnings of an employee for the purposes of computing the extent of the partial incapacity of an employee, as reflected in his average loss of earnings. In calculating an employee’s average weekly earnings regard will be had to his earnings over the period of 12 months preceding the injury whenever this is practicable and the amount so calculated would fairly represent the rate per week at which the employee was being remunerated in respect of his employment by the Commonwealth before the injury. Provision is being made for payment of an attendant’s allowance of $8 a week to an injured employee who requires the constant assistance of an attendant. This allowance, which will be additional to any other compensation for which an employee is eligible, will not be payable, however, during any period when the employee is being maintained as a patient in a hospital or nursing home, or is receiving constant nursing attention and the cost of his accommodation at the hospital or nursing home or of the nursing attention is being borne wholly by the Commonwealth.

Under the existing Act an employee could be disqualified from proceeding with a claim for compensation if he failed to give notice of his injury or disease before leaving Commonwealth employment. The Bill does not re-enact this restrictive provision and, in addition, ignorance has now been included as an excuse for failure to give notice of an injury or disease or lodge a claim within the prescribed time. The classes of persons in respect of whom a dependants allowance will be payable in incapacity cases have been broadened to correspond with the classes of persons who will be accepted as dependants in death cases. The test of dependency is to be dependent for economic support in contrast to dependent on the earnings of the employee as provided in the present Act. For dependants allowances to be payable it will no longer be necessary for th: dependants to be dependants by virtue of a marriage which occurred before the employee was injured. The supplementary allowance of $8.50 will be payable for the dependent husband of a working wife. Allowances will now be paid for student children under age 21. Payment of child’s allowance will also be made for a dependent child who is the issue of a marriage contracted or an ex-nuptial relationship formed after the date of the injury to the employee. Under the revised dependency provisions a de facto wife will be accepted as a dependant if she is dependent upon the employee at the date of his death or incapacity and has been living with the employee for 3 years before his death or incapacity. Weekly payments will now continue should a person receiving compensation leave Australia.

An employee will be able to receive weekly payments of compensation and, at the same time, utilise a proportion of his accrued sick leave credit to build up his payment to his ordinary rate of pay. Under the existing Act an employee who chooses to receive sick pay is ineligible for weekly payments. Several changes of substance have been made in the provisions covering the situation where an employee or a dependant of a deceased employee has been paid or has an entitlement to compensation and recovers damages, either from the Commonwealth or another party, for the injury or death in respect of which compensation has been paid or is payable. The Bill provides that where damages awarded are reduced on the grounds of the contributory negligence of the employee, the amount of the compensation repayable will be reduced in the same proportion. Under the existing Act where damages are recovered from the Commonwealth there is no entitlement to compensation, whereas if damages are recovered from another party entitlement to compensation remains to the extent, if any, that compensation exceeds the amount of damages received. Under this Bill, an employee who recovers damages from the Commonwealth will be in the same position as a person who recovers damages from a person other than the Commonwealth, that is, there will still be a liability for any compensation entitlement in excess of the damages recovered. In the case of an action for damages against the Commonwealth in respect of an injury for which compensation had been paid, the existing Act imposes a time limit of 12 months within which proceedings must be commenced. There is no similar provision in this Bill and thus a Commonwealth employee who has received compensation will be in the same position as other members of the community who sue the Commonwealth, so far as any limitations on actions are concerned.

These are not all the changes and improvements in the existing scheme of compensation that are being made by this Bill. When introducing the Bill in the House of Representatives the Minister responsible for the carriage of the Bill, the Minister for Social Services (Mr Wentworth), circulated an explanatory memorandum in which the contents of the Bill and the relationship between it and the three subsidiary Bills are explained in more detail. I have arranged to have copies of the explanatory memorandum distributed to honourable senators. I should also mention to the Senate that the Government has directed that an inter-departmental committee examine further certain aspects of schemes for employees’ compensation and related payments. Amongst the matters under consideration by this committee are payment of periodical payments in lieu of lump sum compensation to the widow of a deceased employee and the question whether weekly payments in incapacity cases should be assessed having regard to an employee’s average earnings prior to injury rather than that uniform benefits be provided for all employees regardless of differences in earnings. However, we have thought it preferable not to delay this Bill pending the Government’s consideration of the results of the deliberations of this Committee.

In conclusion, might I say that I would hope that after honourable senators, employees and employee organisations have studied this Bill they will agree with the Government’s view that the Bill represents a major advance in the field of workers’ compensation legislation and that when it comes into operation it will provide a generous and modern scheme of workers’ compensation for Commonwealth employees.I trust that honourable senators will give this entirely beneficial piece of legislation a speedy passage and I commend the Bill to the Senate.

Debate (on motion by Senator Bishop) adjourned.

page 1645

UNITED STATES NAVAL COMMUNICATION STATION (CIVILIAN EMPLOYEES) BILL 1971

Bill received from the House of Representatives.

Standing Orders suspended.

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

Second Reading

Senator GREENWOOD:
Minister for Health · Victoria · LP

– I move:

That the Bill be now read a second time. Broadly, the effect of the United States Naval Communication Station (Civilian Employees) Act 1968 is to extend to civilian employees employed by the United States Navy in connection with the station the terms of the Commonwealth Employees Compensation Act as if they were employees of the Commonwealth. It also gives to these employees, or to another person, in the event of an injury or disease causing the death of such an employee, the right to recover damages at common law from the Commonwealth, and again as if the Commonwealth were the employer, in the event of damage arising from injury, disease or death suffered directly as a result of employment with the United States Navy, subject, of course, to the usual requirements concerning negligence being met.

The purpose of this Bill is, firstly, to make amendments to the United States Naval Communication Station (Civilian Employees) Act 1968, which in Part II of the Bill is referred to as the principal Act. These amendments will be effective as from the date of commencement of the principal Act. Secondly, the Bill provides, in Part III, consequent upon the Compensation (Commonwealth Employees) Bill 1971, for the application of the provisions of that Bill to certain civilian employees of the Government of the United States of America employed in connection with the station, whether within or outside the territorial limits of Australia. The amendment to section 3 of the principal Act will make clear that persons employed by an instrumentality of the Government of the United States of America, in this instance, the Navy Exchange, whom it was always intended should be covered by the Act, are civilian employees - within the restricted meaning that that term has in this context - for purposes of the Act. The other amendments to the principal Act will enable the principal Act to be applied to civilian employees who are employed, either within or outside the territorial limits of Australia, by the Government of the United States of America in connection with the station.

When the principal Act was being prepared it was not clear whether any civilian employees of the Government of the United States would be employed outside the territorial limits of Australia and the application of the Act was limited accordingly. It has since transpired that some civilian employees proceed outside the territorial limits of Australia on work associated with the operation of the station and this practice is likely to continue. The Bill provides for the application of the Act to be extended accordingly. I think it might be appropriate to add a few words about the clauses in Part III of the Bill. Clause 10 deals with the classes of employees to whom the Bill will apply. Clause 1 1 will apply the provisions of the Compensation (Commonwealth Employees) Bill 1971, when enacted, to those employees and provides for the modification of those provisions in their application to those employees. The modifications are set out in the Schedule to the Bill. Clause 12 establishes the liability of the Commonwealth in actions at common law that might be taken in respect of damage suffered through injury, disease, death or loss of or damage to property, directly associated with employment in connection with the station and in relation to which the Compensation (Commonwealth Employees) Act 1971 applies. Part III of the Bill will come into effect on the day on which the Commonwealth Employees Compensation Act 1930-1971 is repealed and the new compensation code established by the Compensation (Commonwealth Employees) Bill 1971 comes into operation. I commend the Bill to honourable senators.

Debate (on motion by Senator Bishop) adjourned.

page 1646

AIR ACCIDENTS (COMMONWEALTH LIABILITY) BILL 1971

Bill received from the House of Representatives.

Standing Orders suspended.

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

Second Reading

Senator GREENWOOD:
Minister for Health · Victoria · LP

– I move:

Broadly speaking, the effect of the provisions of the Air Accidents (Commonwealth Liability) Act 1930-1970 is to cover situations where an employee of the Commonwealth or an authority of the Commonwealth might have an entitlement under that Act to payment of damages from the Commonwealth or an authority of the Commonwealth and also an entitlement under employees compensation legislation. The purpose of this Bill is to make minor amendments to the Air Accidents (Commonwealth Liability) Act 1963-1970 consequent upon the Compensation (Commonwealth Employees) Bill 1971. The amendments provide, firstly, for reference to the Compensation (Commonwealth Employees) Act 1971 to be substituted for references to the existing compensation legislation, the Commonwealth Employees Compensation Act, in sections 10, 11 and 15 of the Air Accidents (Commonwealth Liability) Act. Secondly, in relation to sections 10 and 15, which at present contain references to a provision of the Commonwealth Employees Compensation Act that covers the situation where an employee receives compensation and recovers damages - Section 17a - the amendments will substitute references to the corresponding provisions of the Compensation (Commonwealth Employees) Bill 1971, namely, clauses 99 and 100. By clause 2 of the Bill the amendments will be effective from the day on which the Commonwealth Employees Compensation Act 1930-1971 is repealed and the new compensation code established by the Compensation (Commonwealth Employees) Bill 1971 comes into operation. I commend the Bill to honourable senators.

Debate (on motion by Senator Bishop) adjourned.

page 1646

ANGLO-AUSTRALIAN TELESCOPE AGREEMENT BILL 1971

Bill received from the House of Representatives.

Standing Orders suspended.

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

Second Reading

Senator GREENWOOD:
Minister for Health · Victoria · LP

– I move:

That the Bill be now read a second time.

The purpose of this Bill is to make minor amendments to the Anglo-Australian Telescope Agreement Act 1970 consequent upon the Compensation (Commonwealth Employees) Bill 1971. Section 16 of the Anglo-Australian Telescope Agreement Act 1970 extends the application of the existing compensation legislation, the Commonwealth Employees Compensation Act, to Australian members of the AngloAustralian Telescope Board and to employees of the Board. The amendments to section 16 of the Anglo-Australian Telescope Agreement Act 1970 being made by this Bill will enable the Compensation (Commonwealth Employees) Act 1971 to apply to those persons. By clause 2 of the Bill the amendments will be effective from the day on which the Commonwealth Employees Compensation Act 1930-1971 is repealed and the new compensation code established by the Compensation (Commonwealth Employees) Bill 1971 comes into operation. I commend the Bill to honourable senators.

Debate (on motion by Senator Bishop) adjourned.

page 1647

SEAMEN’S COMPENSATION BILL 1971

Bill received from the House of Representatives.

Standing Orders suspended.

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

Second Reading

Senator GREENWOOD:
Minister for Health · Victoria · LP

– I move:

That the Bill be now read a second time. The purpose of this Bill is to increase various rates and amounts of workers’ compensation payable in respect of seamen and their dependants under the Seamen’s Compensation Act. Such compensation is paid by shipowners and not by the Commonwealth. Compensation for seamen serving in intrastate ships, to whom the Bill does not apply, is paid under State Workers’ Compensation Acts. These increases are in line with the increases contained in the Compensation (Commonwealth Employees) Bill now awaiting debate. It is of course desirable that the rates of compensation under the 2 main compensation Acts administered by the Commonwealth be kept uniform and that changes be brought into operation at the same time.

The weekly rate of compensation for a seaman is being increased from $31.80 to $35, and there is provision also for increases in weekly rates from $7.70 to $8.50 for a seaman’s wife and, proportionately, a particularly substantial increase from $2.80 to $5 for each of a seaman’s children. The basic lump sum death benefit, to which other lump sum benefits for various injuries are related, is being increased from $12,000 to $13,500, and the minimum total payment for a dependant child, in death cases, is being very substantially increased, from $280 to $500. Another large increase being made is in the maximum amount of funeral expenses payable in respect of the death of a seaman, which rises from $120 to $300.

There are 4 other respects, in relation to monetary rates, in which the Act is being amended in line with the Commonwealth employees’ compensation legislation. The first of these removes the existing provision requiring reduction, in some death cases, in the amount payable to dependants. This occurs where a lump sum previously paid exceeds the total of certain weekly payments. The second removes the provision which requires a reduced weekly rate of compensation to be paid to minors not receiving adult rates of pay. The weekly payment, however, will continue to be limited to the weekly pay at the date of the injury. The third of the 4 respects referred to does away with the difference in compensation between right and left arms on account of being right or lefthanded. Such differences no longer exist in most State workers’ compensation legislation. Left arm rates are being increased to the right arm rates. The fourth is a matter of wording only. The new Third Schedule brings the descriptions of the various injuries specified into line with the new descriptions being introduced into the Commonwealth employees’ legislation.

A similar code of compensation to that contained in the legislation for Commonwealth employees has always been applied under the Seamen’s Compensation Act. In some respects the provisions have to be applied to suit sea-going conditions and shipowners necessarily have to be consulted. Action along these lines is now proceeding and a Bill to further amend the Seamen’s Compensation Act to introduce a new code similar to that for Commonwealth employees will be introduced as soon as practicable. The Bill provides considerably improved rates of workers’ compensation for all classes of personnel in our Merchant Navy and I commend it to the Senate.

Debate (on motion by Senator Bishop) adjourned.

page 1647

STANDING COMMITTEE ON EDUCATION, SCIENCE AND THE ARTS

The DEPUTY PRESIDENT (Senator Bull) - I inform the Senate that I have received a letter from Senator Gair appointing Senator Kane to the Standing Committee on Education, Science and the Arts in place of Senator McManus.

page 1648

PIG INDUSTRY RESEARCH BILL 1971

Second Reading

Debate resumed from 29 April (vide page 1128), on motion by Senator Drake-Brockman:

That the Bill be now read a second time.

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

page 1648

INTERNATIONAL DEVELOPMENT ASSOCIATION (FURTHER PAYMENT) BILL 1971

Second Reading

Debate resumed from 4 May (vide page 1 323), on motion by Senator Cotton:

That the Bill be now read a second time.

Senator WRIEDT:
TASMANIA · ALP

– This Bill provides for an additional payment by Australia to the International Development Association. Under its terms Australia will increase its payments to the Association to an amount of $16m a year over the next 3 years. The International Development Association is an affiliate of the World Bank, the other affiliated body being the International Finance Corporation. The purpose of the Association, which was formed on the initiative of the Senate of the United States of America, is to provide loans to developing countries which are not in a position to borrow money on the world market at the normal rates of interest. The Association is designed specifically for the very poor countries. Even though the World Bank itself makes loans to the developing nations at concessional rates of interest there are many for whom the service of interest debts which are incurred as a result is too great a burden. Consequently the specific purpose of the Association is to help these very poor nations.

Since the Association came into being in 1960 it has made a total of $2,200m available to the developing countries for the establishment of essential basic industries. By contrast the International Finance Corporation which obtains its money by the normal means of interest bearing loans has provided an amount of only $240m since it was established. So it is quite apparent that the Association is playing a particularly important role in the financial structure of these countries. Of course, it is the prime responsibility of developing nations to provide their own capital resources. For example, during the years since the end of the Second World War in 1945 India, with all its problems, has been able to provide 80 per cent of its own capital for development purposes. The remaining 20 per cent is a critical figure for all those countries. They depend on money which is made available by wealthier nations such as Australia, and more particularly, the United States of America, to allow them to bridge the gap between their capacity and what they would like to do and, I am sure, what we would all like them to do.

One of the tragedies since World War II has been that almost all the crises in that time have occurred in countries which are economically backward. It seems that economic backwardness is a breeding ground for social and political discontent, and also for violence. I believe that all honourable senators are reasonably familiar with the neel for greater economic aid to be supplied. Many times we have heard reference to the widening gap between the richer and poorer nations. Although it has been stated and restated on many occasions, it remains a fact of life in the 1970s. We hope that Australia will be able to play a greater role in helping the poorer countries in the years ahead.

There is no doubt that progress has been made through organisations such as the International Development Association, but tremendous problems still face the underdeveloped countries. For example, in 1969 world trade increased by 13 per cent in value surpassing even the high rates of growth experienced in 1964 and 1968. Exports of developed countries in that time increased by 15 per cent, but for the developing countries - the poorer countries of the world - the increase was only 9 per cent. That comparison shows beyond any doubt that the developing countries were not keeping pace with the richer nations. Total world exports for the same period were about $270 billion, of which only $48 billion represented the exports of the developing countries. The share of the developing countries in world exports declined in 1969 from 18.5 per cent to 17.7 per cent. The decrease may appear to be marginal, but in fact it is very significant for the countries concerned. Growth in developing countries, measured in current dollar terms, rose at a faster rate in 1969 than in 1968. Expansion in real terms, however, has continued to be held back by the persistent rise in price levels. These are the sorts of problems facing the developing countries. They will continue to face them until there is a sharing of the capital and the ability of nations generally to assist each other.

One of the great difficulties of the Association’s work has been that the loans which it has afforded to developing nations have been interest free. A very small service charge of 0.73 per cent is made, as mentioned in the second reading speech of the Minister for Civil Aviation (Senator Cotton), who in this chamber represents the Minister for Trade and Industry (Mr Anthony) The external debt of the developing countries is an enormous factor in any of these considerations. The report of the World Bank for 1970 contains some figures which I believe ought to be cited, ft states on page SO:

Total external public debt of developing countries outstanding at the end of 1968 amounted to about $54.4 billion, of which roughly three-fourths had been disbursed. This represented an increase of more than $3.4 billion over the level of $47.9 billion at the end of 1967, and continued the constant upward trend observed ever since data of this sort first became available about 15 years ago. For the past 10 years, total external public debt outstanding has grown at an average compound rate of almost 15 per cent a year. This rate of increase has doubled the total debt outstanding every 5 years since 1955. . . .

Total debt service, including both amortisation of principal and payments of interest, has been growing almost as rapidly as debt outstanding .. . over the past decade, the rate of growth of both debt outstanding and debt service payments has been about twice the rate of growth of export earnings of the developing countries, and almost three times that of their combined gross domestic products.

These are the sorts of problems that are facing the poorer nations of the world. Honourable senators ought to ask themselves: Is it possible for us to do more? It is a great point at issue, and has been for many years. As a nation, why should we make sacrifices when people in our own country are deserving of more help than they are receiving? Hundreds of thousands of Australians live in poverty and many people, pensioners and the like, in this country need more assistance. It is true that many people in Australia are deserving of much more assistance, but this is a problem which we, as a nation, are capable of solving ourselves if we so desire. If we were prepared to distribute our national income on a more equitable basis we could largely overcome these problems. This decision, which we must make ourselves, will depend entirely upon our outlook as a country. But the poorer countries of the world are not in that position. They cannot from their own resources lift themselves to a level of prosperity comparable with that of countries like Australia. Australia has a prime responsibility in this field to do more than it is doing. For example, it would have been far better if we had spent a proportion of the money that we have spent in the past on fighting the war in Vietnam on developing the poorer countries and helping them to overcome their problems. If we adopt a more realistic approach to world affairs, we will see that the road to more peaceful development of the world lies through organisations such as the International Development Association.

I do not wish to say a great deal more because my time is somewhat limited. The Opposition supports the principle involved in this Bill but believes that a great deal more could be done. Men are not meant to be antagonists but people who can live together, and through organisations such as the International Development Association we can show our goodwill towards other people in the world who are much less fortunate than we are. This would not only guarantee peace in the world, but would also guarantee helping the people today who in many cases live without hope and for whose children little opportunity exists to be educated, fed, housed or given proper health services. Australia could play a major part in helping such people to achieve the things which we take for granted.

Senator BYRNE:
Queensland

– The purpose of this Bill is to activate further financial assistance by Australia to the developing countries on terms and conditions which make it possible for them to increase their economic viability without the dead weight of repayments beyond their capacity and interest charges beyond their ability to meet so that they are able lo service their loan indebtedness. Some weeks ago I had the privilege of participating with other honourable senators and members of the House of Representatives in a mission to the Council of Europe held at Strasburg. It is a council of Ministers of European countries concerned with matters of mutual interest. Arms of the Council are the Organisation for Economic Co-operation and Development and the Development Aid Committee. For many years Australia has been an associate member of the Council of Europe, but this was the first occasion on which Australia was asked to participate in its deliberations. The Australian delegation was led by Senator Sir Kenneth Anderson. Sir William Aston, the Speaker of the House of Representatives, was also a participating member of the delegation. Senator Mulvihill, Senator Davidson, Mr Hurford and Dr Gun, and Mr O’Keefe of the Australian Country Party, constituted the remainder of the delegation. It was a most significant occasion for Australia because it was the first time that we had been given an opportunity actually to participate in the deliberations and discussions of the Assembly. To my knowledge, the report of the Australian delegation has not yet been compiled and presented. Therefore, I may be anticipating the report when I address myself to the situation on this occasion. But I believe that I should take this opportunity to acknowledge the welcome which was given to the Australian delegation, as an actual participant in these deliberations, by those who constituted the General Assembly.

On a particular day the whole of the Australian delegation was given an opportunity to participate in the debate in the Assembly. That was a most significant honour because naturally time was short and opportunities for speakers to be accommodated in the time schedule were limited. But, nevertheless, the members of the Assembly gave us an opportunity to take part in the debate, and virtually every member of the Australian delegation contributed in some way or other to the deliberations. There were many contributions of a diverse character because the area to which we were addressing ourselves - and to which the Australian delegation particularly was addressing itself - was the provision of aid to developing countries. I think that Senator Sir Kenneth Anderson, as leader of the delegation, presented an account of Australia’s contribution, and the other members of the delegation presented their individual views as to those matters which particularly warranted international attention in this field of providing aid to developing countries. We felt individually - and I think it was felt by the Assembly - that the Australian delegation having come 12,000 miles to participate in what appeared to be purely a pan-European congress, was an instance of the new world coming into the deliberations of the old world and co-operating in the fullest degree to help the underdeveloped countries, which would be unable to progress at all without the assistance of the developed countries whether old or new.

Therefore, when a Bill such as this comes before the Parliament it is accepted with enthusiasm and with the unqualified support of all groups and sections within the legislature. I feel that as a result of the visit of this delegation and our participation in the deliberations, the association or alliance between Australia and the European countries wiil.be even closer and stronger. It was considered an amazing thing that a delegation from our country should come from so far away in order to get together with the delegates of European countries to discuss this programme of participating aid. There were quite small delegations of 3 members, I think, from Japan and Canada. The Australian delegation was numerically the largest and, for that reason, I believe the most significant. I think that Australians would have been proud to know that their country had seen fit to join in those deliberations and to place before this meeting of the Assembly of the nations of Europe our programme of aid and the measures of assistance which we had given over the years.

I take this opportunity to pay my respects and to express, on behalf of our delegation, our appreciation of the manner in which the delegation was led on that occasion by Senator Sir Kenneth Anderson. Naturally, he presented the major contribution and made the major speech at the General Assembly. He placed before it the governmental point of view, the governmental programme and the governmental record which, substantially, was the record of Australia generally. There may be differences between parties as to the exact form which aid should take and as to the exact amount of aid which should be given, but there is no argument on the necessity for aid and for the most generous assistance that can be forthcoming. So I take this opportunity to place these matters on the record, and I hope that we who were present on that occasion were only the precursors of similar delegations on other occasions because we were welcomed there, our presence was recognised and we were given an honoured position. I believe that other countries recognise the role which we are playing in providing aid to developing countries and that they accept our assurances that within the limits of generosity and capacity we will continue to’ play the role that we have played up to this time. The Australian Democratic Labor Party supports the Bill.

Senator Sir MAGNUS CORMACK (Victoria) (3.11) - 1 do not intend to take much time on this Bill, but on this question of international aid I want to place before the Senate a point of view which 1 think is timely. 1 do not accept the view that Australia should seek directly to put itself in the position of being one of those nations which contribute 1 per cent of their gross national product in the form of aid. Australia is a capital importing country, and a great deal of the aid that we are able to contribute at the present time is contributed because of the fact that we are able to redistribute some of the capital which is flowing into Australia. The Treasurer (Mr Snedden) has made the comment that we have reached the stage where we are contributing 1 per cent of our gross national product towards aid to other countries, but lumped into this figure is the foreign capital which has flowed into Australia and which has been then remitted into the Bougainville area for the development of the Comalco copper mines in Bougainville. This amount is included in the amount which we claim we are contributing in the form of aid to the less developed countries. 1 am also of the opinion that not only are we over-stretching ourselves in thi provision of aid, but we are confronted in Australia at the present time with constant and escalating demands for sums of money for social services and aid to the States. Later in this session we will be dealing with a Bill which cuts back some $9m from Victoria, the State that I represent. Victoria is attempting to maintain its own rate of progress although it has no control over the resources which it is required to produce in order to maintain this rate of progress. This can be duplicated all over Australia. I was interested to analyse some of the contributions which have been made to the International Development Association. It is interesting to observe that not one Communist country contributes to the Association. The only country which might be described as a Socialist country and which contributes something towards the Association is Yugoslavia. It contributes $4m. But when one looks at the tensions in the world today one discovers that all that the Socialist republics of the various parts of trie world contribute is the iron rations of war. It is the Western countries which are being asked to contribute sums of money towards the International Development Association.

I will refer to some of the amounts of money that are being contributed to the Association, and I ask honourable senators to bear in mind that not one of the Socialist countries, with the exception of Yugoslavia, is contributing anything to the Association. Australia is asked to produce $US48m: Austria $US16.3m; Belgium, $US40.8m: Canada, $US150m- and Canada can afford to pay that for the simple reason that it has very small defence expenditure. Most of the time Canada lives in an asbestos box provided by the United States of America. Denmark is asked to produce $US26.4m: Finland, SUS12.2m: France. $US150m: Germany, $US234m; Italy, SUS96.7m; Japan $US144m; Kuwait, SUS1 0.8m- and Kuwait has plenty of oil, and we are paying for it. Luxembourg is asked to produce $US1.2m, the Netherlands, $US67.6m: Norway, $US24m; South Africa, $US3m; Sweden, $US102m. There is a note about Switzerland which says that Switzerland is nol a member of the International Development Association but has agreed to lend $US30m free of interest, to be repaid in 40 annual payments. That might be an idea. The United Kingdom is asked to produce $US311m. The United States, out of a total of SUS2,428m, is asked to produce $US960m.

Senator Sim:

– And it is always being abused for doing things like that.

Senator Sir MAGNUS CORMACK:

Yes, it is always being abused for doing that. I reiterate that with which I began. I think that some of this charity should be recognised as beginning at home. Later in the session we will be involved in trying to reconstruct Australian primary industries. As I travel Victoria I see some of the problems that I associate - as a man of my age would associate them - with the economic depression 1930 and 1931. I point out to the Senate that keeping up with the international Joneses is no job for us at present. We have tremendous internal problems. I think in regard to some of the money that we appropriate for international aid, whether it be to increase the capital of the Asian Developmental Bank or provide soft loans to the International Development Association - wherever this aid goes and however much it may create a sense of warmth in the hearts of the people who feel that we have a duty to do this kind of thing - the time is being reached, if it has not been reached already, where we should start to divert some of this money into the areas of need in Australia. I regard that as our primary responsibility. If we continue on this escalator of producing these vast sums of aid, particularly when we have areas of substantial need in Australia, an angry Australian electorate, when the truth finally reaches it, will argue much as I am arguing this afternoon. The commitment has been made. For that reason, but for no other reason, I support the Bill.

Senator DRAKE-BROCKMAN:
Minister for Air · Western Australia · CP

– in reply - I thank the Senate for the passage that it has given to the Bill. Although no senator has opposed the Bill, 3 speakers have used it as a vehicle by which to express their views about the seeking of approval for the payment of$US48m to the International Development Association. I shall draw the attention of the Treasurer (Mr Snedden) to their remarks. I suggest that we proceed with the second reading of the Bill.

Question resolved in the affirmative.

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

page 1652

PIG INDUSTRY RESEARCH BILL 1971

Second Reading

Debate resumed (vide page 1648).

Senator MILLINER:
Queensland

– The Opposition indicates that it will offer no opposition to the passage of this legislation but that in the Committee stage of one of the cognate Bills, the Pig Slaughter Levy Collection Bill, it will move amendments to the clauses which deal with the averment and the period of time in which court action may be taken. I believe it is unfortunate that there is no unanimity of thought within the industry on the levy for the research purposes set out in the Bill. It appears that at least 2 organisations - namely, the Australian Primary Producers Union Pig Committee in Queensland and the Victorian Farmers Union Pig Committee - are opposed to the payment of this levy. Perhaps it would . be of advantage to all concerned if the Minister for Air (Senator Drake-Brockman) could explain what steps have been taken to endeavour to obtain unanimity of thought among all sections of the industry. In respect of legislation which is for the progress of the industry it is a pity that we could not have all within the industry agreeing to the propositions contained in the Bill. I repeat that it might be of interest to the Senate - and I know that it would be to me - if the Minister could explain what steps have been taken to influence these organisations to accept the legislation. The Minister could state whether they have seen the light, as it were, and agreed to co-operate.

The Opposition was considering asking that a referendum on this matter be held, seeing that a levy was to be imposed, but we felt that, as a majority of the people within the industry had accepted the proposition that a levy should be imposed, the legislation should be passed. On the other hand, if the majority had decided against the imposition of the levy, we most certainly would have asked for a referendum to be held. Another point has exercised my mind in this direction. Perhaps the Minister would indicate where in the Bill are the measures necessary to require the levy to be paid. I cannot find a similar provision to that which is contained in identical legislation. If some people who are now in the frame of mind to oppose the levy continue to adopt that attitude, I believe that it will be necessary to have some provision to enforce the payment of the levy.

Senator Byrne:

– What is it that you cannot find in the Bill? There are 3 associated Bills.

Senator MILLINER:

– I know there are 3 associated Bills. I can find no provision requiring the payment of the levy and no provision stating what will happen if the pig farmer fails to pay the levy. Perhaps the Minister would advise the Senate about that matter. There is a fine of $200 provided if the people responsible for furnishing returns to the Government for the purpose of determining that the levy has been paid are convicted of failing to return those forms. I ask the Minister whether the offence is a continuing offence. Again the Minister might explain that, because it appears to me that once a person in that category fails to furnish a return, if he is charged, convicted and fined there does not appear to be an continuing offence. Does the Government have to go through the same process every time the person fails to respond to the requirements of the Bill?

Senator Byrne:

– Are you suggesting that there is no provision for an offence if the person does not pay?

Senator MILLINER:

– That is it. There is a provision for the offence, but the offence having been discharged and the person having been fined for noncompliance

Senator Byrne:

– What is the offence?

Senator MILLINER:

– The offence is failure to furnish the required information. I would appreciate it if the Minister would indicate to us how we are to overcome the problem if a continuing offence is involved. Certain opinions expressed on the dried fruits industry levy legislation correspond with what could well be said in respect of this legislation. I do not propose to express those opinions on this occasion. They were canvassed, the Senate divided on them and the views of the Opposition were in the minority. So I believe that it would be futile for us to present those views again.

Nevertheless, we say that it is unfortunate, if such be the case, that the Government has failed to convince all sections of this industry that it is to their advantage to co-operate. The Oppposition believes that the imposition of a levy for research purposes is a legitimate project because the research programme will return advantages to the person Who pays the levy. It is estimated that this levy will produce about $155,000. With the matching grant from the Commonwealth Government, it should go a long way towards establishing and continuing the research that is so necessary in this industry. This afternoon we have heard a member of the Government parties refer to the difficulties being experienced by those in the primary producing section of industry. Those difficulties are perfectly obvious. I believe that all concerned will agree that a programme of this nature - one designed to improve by research the product of a primary industry - is to the advantage of the industry concerned and subsequently of Australia. In those circumstances, the Opposition will not oppose the legislation; but at the appropriate time in Committee we will move 2 amendments, as I have indicated.

Senator WEBSTER:
Victoria

– No legislation relating directly to the swine industry has previously been introduced into the Federal Parliament. Therefore, this legislation is of significance to those directly and indirectly concerned with that industry. At the present time 3 Bills are before the Senate. They provide the vehicle for the establishment and financing of a research scheme for the pig industry. It is interesting to note that ‘research’, within the meaning of this legislation, means:

  1. . scientific, technical or economic research in connection with the pig industry, and includes -

    1. the training of persons for the purpose of any such research;
    2. the publication of reports, periodicals, books and papers in connection with any such research . . .

The levy to be applied will probably be 5c per pig slaughtered. I note that clause 6(1.) of the Pig Slaughter Levy Bill states:

The rate of the levy is such amount (not exceeding Ten cents) in respect of each pig slaughtered as is prescribed.

As Senator Milliner said, this probably will amount to about Si 50,000. The Commonwealth will appropriate a similar amount. That will make about $300,000 available for research purposes.

Following many years of painful negotiation, there is today a recognised Federal organisation in this industry, namely, the Australian Commercial Pig Producers Federation. There is some dispute as to the ability of that body, which is the Federal organisation accepted under this legislation, to. speak for all pig producers in all States. I am advised that the attitude of the Victorian Farmers Union is that, whilst not demanding a deferment of this legislation, it would prefer to see a referendum on this matter. At a recent meeting of the Victorian Farmers Union Pig Executive the following resolution was carried:

That this Executive request a referendum of pig producers throughout Australia to determine the question of the introduction of compulsory pig levy. That we request that the poll be undertaken before the pig levy legislation is introduced into Federal Parliament.

That seems to be a pretty severe step; but I understand that the VFU does not now wish to follow it through, although it did have some doubts about this matter in the early stage. The VFU is a very important farmer organisation in Victoria. I understand that its differences with the Australian Commercial Pig Producers Federation relate mainly to the constitution of that body. It is regretted that the VFU, by its own actions I believe, remains unrepresented on the ACPPF. The complaint which has been conveyed to me and which may have some basis is that at the present time the Federation apparently is controlled mainly by stud breeders of pigs. I ask the Minister for Air (Senator DrakeBrockman), who represents the Minister for Primary Industry (Mr Sinclair), to comment on whether that is the position.

Senator Young:

– Not in South Australia.

Senator WEBSTER:

– I am advised that 7 of the 12 men on the committee, including 1 man from South Australia who is a director of a meat company, are stud breeders. Whilst stud breeders certainly have a very important part to play in this industry, it must be said that stud breeders own only approximately 2 per cent of Australian pigs.

Senator Prowse:

– You mean stud pig breeders.

Senator WEBSTER:

– -That is quite correct. We are talking about the pig industry. 1 merely indicate that 98 per cent of the pigs are owned by commercial breeders and those are the pigs in respect of which the levy will be enforced. The comment has been made to me - I am uncertain as to its accuracy - that 7 of the 12 men on the committee are stud pig breeders. I am advised that this point was raised with the Australian Pig Society some time ago, when it was involved in the origination of the body which has now been recognised by the Commonwealth. At the second meeting held in Melbourne on Tuesday, 20th May 1969, the Australian Pig Society was asked what part it would play in the proposed Federal organisation of commercial pig keepers. I am advised that at that time Mr Dunsford said that immediately the commercial organisation got off the ground there would be autonomy of the commercial organisation, “and that assistance given by the stud section would be assistance only and, if at any time during the interim period the stud section or the’ Federal body of the Australian Pig Society could give assistance, it would willingly do so. So at that time he saw the Federation as being completely autonomous and controlled by commercial pig producers, with the stud side completely out of it immediately the Federation was operative.

Provided that there are wise men on the council, I imagine that the new body will not get into any trouble. Undoubtedly the 2 organisations have the welfare of the producers in this industry at the centre of their hearts. One hopes that they can be united so that the intelligence and wisdom of the officers and members of the affiliated bodies can further promote the purposes of this legislation. The Australian Commercial Pig Producers Federation has achieved recognition by the Federal Government and the Australian Agricultural Council. That is a very important step. I understand that the Victorian Minister of Agriculture felt that the Federation fairly represented the Australian pig industry. Above all it is important that the individual commercial producer should have as a basic right a voice in the affairs of his own industry. Any organisation set up to assist and service a primary or a secondary

Industry must be a servant organisation. I hope that the ACPPF will continue to ensure that that principle applies.

I certainly wish the new federal organisation the utmost success in the interests of pig producers. I am confident that the organisation’s establishment problems will be overcome and that once harmony has been established throughout the industry it will be maintained. An industry disintegrated is at risk whereas one which is well organised has great potential to assist its members and to serve the interests of the community generally. The pig industry is of such a size that it is of particular significance to Australia. The latest advice is that Australia has 43,000 pig producers and about 2 million pigs. Perhaps in this time of inflation and increasing costs it is worthy of note that the size of herds has increased progressively and that in the past 16 years the production of pig meat in Australia has almost doubled. Even in recent years we find that in 1968-69 the value of pigs slaughtered was about $85m whereas in 1969-70 the value had risen to SI 00m. This is now an important primary industry which has a significant potential.

The importance of this measure, which is to provide for the establishment and operation of a research scheme, leads us to look back on the great amount of money that has been spent on research in other industries and to contemplate where those industries might be today without the benefit of that research. .1 invite honour able senators to consider the great volume of money - millions of dollars - which has been spent on research into wheat, dairying and wool. One can argue that great advantages have derived to producers from this research. As we look back from 1971 one can question where research has led those industries. Many of them are in serious trouble at present. But the type of research envisaged by this Bill will have a potential for increased productivity by producers, increased efficiency on farms and an improved quality product. Further, it will assist in mechanisation of the industry and in reducing direct costs. These improvements can be of great benefit to those who are now in the industry.

One of the first aims of the industry must be an improved quality of the home product. To illustrate this point I inform honourable senators that at a recent conference of the trade comment was made that 40 per cent of pigs marketed in Australia were totally unsuited to trade requirements. That may come as a surprise to honourable senators. This is a situation in which there is great potential for improvement. Victoria has about 9,000 pig producers, and if one looks at past procedures one can only conclude that action is long overdue to assist producers in that industry. Some action has been taken already to reorganise the State Department of Agriculture to enable assistance to be given to the pig industry. The Department now has only one piggery officer to help producers and he certainly must find it difficult to organise and carry out the proper functions of his office. Useful advances can be made in this industry and research assistance will be most welcome. A. wealth of information is available from other countries.

In view of the objective in the Bill to establish research through the publication of reports, the organisation may benefit by taking note of overseas sources which could provide much assistance in research. Much of that information could be made available to farmers in Australia. However, the type of farmer who is involved in this industry needs really the benefit of extension officers. Although the printing of periodicals is treated in the Bill as being an important part of research, it is more important to get the information to the producer so that he can be encouraged in his work. Great changes are taking place in the feeding of pigs. This is acknowledged in the May 1970 report of the New Zealand Pig Producers’ Council which states:

The pigmeat market in New Zealand remains in a stale of near equation of supply to consumption with prices for pigs moving in sympathy with the relatively small under or over-supply position. In an era when milk by-products are being processed into an ever-widening range of consumer products, it is inevitable that a decreasing volume of these by-products - both skim milk and whey - will be available to the pig industry. The historical relationship between the dairy industry and the pig industry is therefore phasing out and the pig industry is gradually emerging as a meatproducing industry in its own right.

In marketing there is considerable information to be evaluated. A re-evaluation is needed of sale procedures in this industry, as in most other primary producing industries. I hope that research will achieve something in this area by an evaluation of the method of disposing of livestock in this country. Some of the present methods of marketing are probably not in the producers’ interests in many instances and undoubtedly changes will come. How promptly those changes should be made is a subject for consideration. In this regard I refer to comments made by Mr R. E. Brocksopp, a piggery officer of the Department of Agriculture in Tasmania, following his visit on a study tour of Canada, where he investigated pigmeat grading and marketing. He reported:

The method of marketing in Canada for pigs other than those for slaughter are sold through similar markets as they are in Australia, however for those pigs which are to be slaughtered for pork or bacon in many provinces the method of marketing is somewhat different, and in the writer’s opinion unique inasmuch that the pigs are sold through a closed circuit teletype system which is available from the manufacturers on a rental basis to all the processes operating within a marketing organisation.

Senator Byrne:

– Pigs are sold on that basis, you say?

Senator WEBSTER:

– Yes. This indicates that there is a much more up-to-date system of disposing of pigs than we have in Australia today. The honourable senator would be very interested in some of the comments made in this report on Mr Brocksopp’s overseas study tour. I shall not take up the time of the Senate by reading it all, but included in the wealth of information contained in the report is an indication that weight and grade of pigs are taken into account in marketing and that the farmer is not confined to selling his stock under the hammer.

Senator Prowse:

– We sell by guess and by God.

Senator WEBSTER:

– That is right, and I understand that at times He does not come to the sale either. The establishment of the Pig Industry Research Trust Account and the Pig Industry Research Committee which will administer the account has received approval from the majority of pig producers in Australia. There is some dissension within the industry, but it is to be hoped that all sections of the industry will unite for the good of the industry and. for the community in general. I believe that the Government is to be congratulated for its readiness to assist the industry. As the Minister has said, the pig industry is in a period of rapid growth and development. I hope that this measure will assist the industry to efficient and orderly development.

Senator LITTLE:
Victoria

– The Democratic Labor Party supports this measure. Like other honourable senators, it has become a.ware of the division within the industry. Indeed, it would seem that the Australian Commercial Pig Producers Federation - the Commonwealth body - represents the majority of pig producers throughout Australia although there does appear to be a considerable number in Victoria and some in Queensland who are still associated with the Victorian Farmers Union. The first principle that we came up against as parliamentarians legislating in the interests of the pig producers, the country and the national economy in general is the necessity to establish the Pig Industry Research Committee which will undertake research to assist this industry. I think this is a matter of some urgency.

Whilst it has been said that there has been a rapid growth in pig numbers - from something like 1 million to 2 million pigs - in a period of some 13 to 16 years, this is not actually something on which the nation should compliment itself, particularly when one analyses the trading opportunities that have developed, particularly within the Asian areas, during this time. There is tremendous potential to double and treble our pig meat exports, if the industry can be lifted to an acceptable international standard. Pork is one of the most popular items of diet throughout the Asian countries and, as those countries become more prosperous as a result of their developing economies, Australia’s potential to increase the export of this product will develop enormously. This is not an industry which can be successfully conducted in confined spaces, such as exist m many of the Asian countries that could be potential customers. The pressures of their own development may curtail somewhat their capacity to produce pig meats, whereas Australia has ideal circumstances.

The production of pig meat in Australia could assist many of our declining rural industries. While many primary producers ere today contending that they have solved some of their problems by switching from wheat and wool to beef, because the beef industry has not been affected as much as the other primary industries, it could very well be that, as an alternative means of diversification, the pig industry offers tremendous opportunities if we take the trouble to act. For that reason alone the setting up of this research body should not be delayed because of some differences within the industry amongst the people who are most concerned. Those pig producers to whom I have spoken are concerned not so much with the setting up of the Research Committee, the costs involved or the levy itself as they are that the administration and application of this legislation might fall into too few hands. In their discussions with me, the pig producers have all agreed that it is necessary for research to be carried out and for the costs to be met.

I should like to draw the attention of the Minister to the composition of the Research Committee itself. Clause 9 of the Pig Industry Research Bill provides that the Committee shall consist of 6 persons representing the organisation known as the Australian Commercial Pig Producers Federation, 2 persons representing the organisation known as the Australian Agricultural Council and various’ other persons who are nominated. But as the Minister’s second reading speech indicates, the representatives of the Commercial Pig Producers Federation and of the Australian Agricultural Council will constitute a majority of those persons who will actually administer the functions of the Committee. They will make recommendations as to what the amount of the levy shall be. They will, of course, be limited by the ceiling of 10c a pig but they can determine the levy at any figure below that amount.

However, one body, which has been making representations of this matter, does not seem to be represented on the Research Committee unless it is by the 2 persons who will represent the Australian Agricultural Council. It could be said that the easy way out for the members of that body would be for them to forget their identity and join the Commercial Pig Producers Federation, thus gaining representation through that federal body which has the major representation on the Committee, but I wonder whether it is right for the Parliament to impose its will to that extent on people who belong to a voluntary organisation within the industry and to penalise that section of the industry by having it not represented on the Research Committee which will administer the industry. If this section is not represented I think that naturally there will be objections. I am prepared to accept that this body does not represent the majojrity of pig producers throughout Australia because it would seem that in most of the States the pig producers are now organised into the federal body and have no objection to it. However, in Victoria and, to a lesser degree, in Queensland some producers object to the Commercial Pig Producers Federation and its constitution. This prevents complete harmony in the industry and because of that disharmony I think it would be a fairer consideration if some representation had been allowed for in this Bill - although it has not been sought - for those people who are not members of the Commercial Pig Producers Federation.

Members of the Democratic Labor Party believe that it is in the interests of the industry and of the national economy that these Bills should be passed. We have not yet had time to consider the effects of the amendments that have been foreshadowed by the Australian Labor Party. As we have now been supplied with copies of the amendments, we will consider them, and at the appropriate time in the Committee stage will make known our opinions of them. However, we support the legislation.

Senator Sir MAGNUS CORMACK (Victoria.) (3.52) - I have been listening with a great deal of interest to Senator Webster and Senator Little and other honourable senators discussing the question of pigs. I feel that perhaps I can contribute something to this debate because I breed pigs and have done for many years. I am possibly the only senator in this place at this time who knows something about them. I rise at this juncture to take up only 2 observations which were made, firstly by Senator Webster and secondly by Senator Little. They are related observations but they do not coincide. Senator Little spoke about producing pigs to an acceptable international standard. The question I ask is: What is an acceptable international standard? The type of pig that might be wanted in Japan or China would not be the type of pig that would be wanted if we could have access to the European Common Market.

Senator Poke:

– It would all be one big bore anyway.

Senator Sir MAGNUS CORMACK:

– I notice that there has been a rising standard of puns in the Senate over the last few years. Senator Webster spoke about marketing. The problem with all Australian primary industries in the past has been that they have not been market oriented. I am not talking about a problem of marketing. The produce that generally comes from our Australian farms is not . directed towards the actual market that the consumer wishes. In other .words, the consumer dictates the standard in the final analysis. However,, for the last 30 or 40 years, over all the aspects of the Australian primary industries, the scientific and technical resources that have been placed behind those industries have been concentrated on the production of quantity irrespective of quality. Quantity is not directed to specific markets, and therefore I am anxious that the Minister, when he replies at the second reading stage, will indicate in clearer terms than those in his second reading speech the type of market at which these technical resources will be directed.

The present problem in the Australian pig industry is that the stud breeders, who produce the foundation stock for the industry, have their eyes pretty clearly fixed on the type of market to which the industry should be directed, but the people who claim, in Senator Webster’s terms, to have 98 per cent of the pigs in Australia are not market oriented. They are production oriented. The great problems of the past, the great problems of the present and the great problems of the future in Australian primary industry relate to the possibility of producing the articles and commodities that the market requires. All the research in the world aimed at increasing farrowing levels - increasing litters per sow per year - and investigations into foodstuffs and so forth and so on will be useless unless there is a clear and coherent quality in the mind of the marketing authority and the people controlling the research funds about what the market requires. The market has to be sought. Whatever the standard in various parts of the world, unless we specifically pursue that type of market, all the money we use for research will have little effect. Nevertheless, subject to what I have said, I commend the Bill.

Senator DRAKE-BROCKMAN:
Minister for Air · Western Australia · CP

– in reply - I thank honourable senators for supporting these Bills. I want to take a few moments to reply to the questions posed by them. The proposal for a research scheme was put forward by the Australian Commercial Pig Producers Federation. This is the only federal body or organisation for the pig industry. Producers from all States are represented. It consists of 6 State councils. On the New South Wales council there are representatives of organisations such as the Australian Pig Society, New South Wales branch, the Australian Primary Producers Union, the North Coast Pig Producers and Research Council, The United Farmers and Woolgrowers Association, and the Pig Producers Co-operative. Through amalgamation of their organisations, the Australian Primary Producers Union and the United Farmers and Woolgrowers Association have become one body. The old APPU organisation has joined with the United Farmers and Woolgrowers Association. Those bodies are affiliated with the Australian Wool and Meat Producers Federation and the Australian Commercial Pig Producers Association. I will refer again to that situation when I deal with the set-up in Victoria.

In Victoria in the old days we had the Victorian Dairy Farmers Association and the Austraiian Pig Producers Society of Victoria. We then had representation from the APPU and the United Farmers and Woolgrowers Association. Although the APPU and the United Farmers and Woolgrowers Association came together as the Victorian Farmers Union and are affiliated with the Australian Wool and Meat Producers Federation, that body is not affiliated with the Australian Commercial Pig Producers Federation. There have been affiliations involving the APPU in both New South Wales and Victoria but there is a difference between the 2 States. In Queensland we had the Queensland Dairymen’s Organisation and the Pig Industry Producers Association. Senator Milliner asked what had happened to the representatives that were associated with the APPU. The APPU organisation in Queensland did not affiliate with any body. Its members drifted away and became members of the Pig Industry Producers Association in their own right. That organisation now has representation on the Queensland State Council. In Western Australia the Farmers Union was formed some years ago as an amalgamation of the Wheat and Woolgrowers Association and the Wheatgrowers Union. There was no APPU representation in that State. Members of those bodies still form part of the Council in Western Australia, together with the Australian Pig Society. In Tasmania we have the Tasmanian Farmers Federation and the Australian Pig Society.

Each of those councils is able to send 2 delegates to the Australian Commercial Pig Producers Federation. In Victoria there is a domestic problem. Every effort has been made by the Victorian Council to have the Pig Division of the Victorian Farmers Union affiliated with the Council. The report of the annual conference in 1970 of the Victorian Dairy Farmers Association stated:

The Victorian Council has without success repeatedly invited the Victorian Farmers Union, which is not affiliated with the Council or the Australian Commercial Pig Producers Federation, to join it so as to make possible full representation in the Federation, through the Council, of all organised commercial pig producers in Victoria.

Senator Webster said that 7 of the 12 members of the Commercial Pig Producers Federal council, are stud pig breeders. I do not see anything strange about this. I think this would be normal practice. Anyone who knows the pig industry would agree that a large number of stud breeders also run commercial herds. The various organisations within a State make up the Council in that State and that Council elects 2 members to the Federal Council, be they stud breeders, commercial breeders or stud breeders with commercial herds as well. It is up to each State organisation to see that it gets the representation it wants on the federal body by appointing a man who is purely a commercial breeder or a man who breeds some pigs and runs a commercial herd.

Senator Milliner:

asked what would happen to a commercial breeder who did not pay the levy and continued to refuse to pay the levy. Let us consider the practical situation involved. When a breeder brings his pigs to an abattoir for sale the abattoir authorities are responsible for collecting the levy. The abattoir authority will deduct the levy when making out the account. If the levy is not paid the Government may sue, because this is a civil debt. Senator Milliner asked which clause dealt with this matter. Clause 7 of the Pig’ Slaughter Levy Collection Bill provides for a penalty of 10 per cent of the levy for late payment. This penalty also could be collected as an ordinary civil debt. In . the practical position referred to by Senator Milliner the levy would be automatically deducted when the sales account is furnished by the abattoir. If objection were taken to this deduction it would become a civil debt and the Government could sue. It will’ be found that under clause 7 of the Pig Slaughter Levy Collection Bill a penalty of 10 per cent per annum could be imposed, which is also a collectable civil debt.

Senator Webster:

asked what kind of research work would be undertaken by the research committee. Perhaps. I am prejudging the situation in saying how the committee will allocate its moneys, but the committee may decide that it wants to have a look at likely projects to support and the suggested types of research include nutrition, disease control, progeny testing, grading and marketing. In his contribution to the debate Senator Sir Magnus Cormack suggested the type of research which the committee should undertake. I am quite sure that the research committee will have a look at the suggestions put forward by Senator Sir Magnus Cormack and, if in its wisdom it decides that his suggestions would be of benefit to the industry, I am sure that it will adopt them.

The last matter to which I wish to refer is the part to be played by the Pig Industry Research Committee and how it is to be comprised. I think Senator Little raised this matter. The Research Committee will include 6 representatives from the Australian Commercial Pig Producers Federation. These representatives will be elected by the Federation itself. They will be either commercial or stud breeders, depending on who the Federation elects. There will be 2 representatives from the

Australian Agricultural Council. These representatives are generally officers of the State departments of agriculture. One representative will be from the Commonwealth Scientific and Industrial Research Organisation. A representative of the universities will be also on the Committee. He will be elected by the vice-chancellors of the universities of Australia. I understand that there are about 14 vice-chancellors throughout Australia. They will elect one representative to the committee. The Department of Primary Industry also will have a representative. The Department’s representative will be chairman of the Committee. That will be the membership of the Committee.

Senator Sir Magnus Cormack:

– What does the universities’ representative have to do with it?

Senator DRAKE-BROCKMAN:

– I. have been informed that the universities’ representative will be a man who has a research background. He will be able to give the Research Committee his advice and experience in that line. I think I have covered most of the points mentioned by honourable senators.

Question resolved in the affirmative.

Bill read a second time.

In Committee

Clauses 1 to 7 - by leave - taken together.

Senator MURPHY:
Leader of the Opposition · New South Wales

– Could the Minister advise me how much is expected to be raised annually under this measure?

Senator DRAKE-BROCKMAN:
Minister for Air · Western Australia · CP

– An amount of $150,000 is expected to be raised from the producers themselves. The Commonwealth will match this amount, which means that a total of $300,000 is expected to be raised annually.

Senator MURPHY:
New South WalesLeader of the Opposition

– What is the constitutional basis for this Bill? A number of similar measures have been introduced. Perhaps the Minister could indicate to me from where the Parliament gets its legislative basis for passing this kind of legislation? I refer in particular to the provision in relation to financing research out of levies imposed on producers. If the Minister has difficulty in answering that question, will he tell me why this kind of research should not be done by a body such as the Commonwealth Scientific and Industrial Research Organisation? In this way the people in the pig industry would have their research work paid for by the Commonwealth out of the taxes which they themselves, along with other people, have no doubt paid.

Senator DRAKE-BROCKMAN:
Minister for Air · Western Australia · CP

– I understand that the power comes from the interstate trade and commerce provision of the Constitution. The levy will be, of course, something that is common to all producers in each State.

Senator Murphy:

– Could the Minister answer my other question about the Commonwealth Scientific and Industrial Research Organisation?

Senator DRAKE-BROCKMAN:

– A levy is to be imposed for the purpose of raising funds for research. The Commonwealth Scientific and Industrial Research Organisation will have a representative on the Research Committee. It will be one of the bodies whose suggestions will be taken notice of by the Research Committee.

Senator MURPHY:
New South WalesLeader of the Opposition

– I asked the Minister why the research could not be done by the Commonwealth Scientific and Industrial Research Organisation or some other body and paid for by the Commonwealth out of the taxes it imposes. Why do the people in this industry have to pay for the research work that is conducted in the industry when research work is done by the CSIRO for so many other branches of industry? Why could it not be done by the CSIRO in the ordinary carrying on of its research programme?

Senator Byrne:

– This is common practice. It is not exclusive to this industry.

Senator MURPHY:

– That is why I have asked the question. I have seen it happen so many times that it appears to me that the Commonwealth is departing from the practice of having its research conducted by its own research organisation and paid for out of ordinary Commonwealth funds. The Commonwealth is adopting a policy of forcing certain sections of industry to raise a levy on a dubious constitutional basis in order to pay for the research work that is conducted in that industry.

Senator DRAKE-BROCKMAN:
Minister for Air · Western Australia · CP

– I understand that the industry requested this kind of research. I think I made the point in the second reading speech that the industry, through its organisations in the States and through its Federal body, came to the Government with a plan. That plan had been before the State governments and the Australian Agricultural Council and had found favour and agreement with all those bodies. Under this Bill, for every $1 that the producers raise they receive $2 for research purposes - their own Si plus a matching SI from the Commonwealth Government. The Commonwealth Scientific and Industrial Research Organisation gets part of its funds from the Treasury. The remainder of the funds will come from the 9 industry research committees that will be operating when these 3 Bills come into operation.

Clauses agreed to.

Remainder of Bill - by leave - taken as a whole, and agreed to.

Bill reported without amendment; report adopted.

Third Reading

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

page 1661

PIG SLAUGHTER LEVY BILL 1971

Second Reading

Debate resumed from 7 May (vide page 1616), on motion by Senator DrakeBrockman:

That the Bill be now read a second time.

Question resolved in the affirmative.

Bill read a second time.

In Committee

The Bill.

Senator MURPHY:
New South WalesLeader of the Opposition

– The Pig Slaughter Levy Bill imposes a levy on the slaughter at an abattoir of pigs for sale for human consumption. The Minister indicated that the constitutional basis for the last Bill before the Senate was the interstate trade and commerce clause of the Constitution. Will the Minister tell us what is done about persons who might slaughter pigs for consumption intrastate, m other words, pigs that are not intended either for interstate trade or commerce or for commerce with other countries?

Senator DRAKE-BROCKMAN:
Minister for Air · Western Australia · CP

– I am advised that the matter of pigs that are slaughtered for consumption intrastate does not arise in this case because the levy is imposed under the taxation power of the Commonwealth. The only question that really arises is whether the tax or levy is imposed uniformly on pig producers throughout the Commonwealth.

Senator MURPHY:
New South WalesLeader of the Opposition

– Do 1 understand that the Minister is now suggesting that the constitutional basis is the taxation power rather than the interstate trade and commerce power?

The TEMPORARY CHAIRMAN (Senator Sir Magnus Cormack:
VICTORIA

– Would Senator Murphy be agreeable if we got through the Committee stage and argued this question at the third reading stage?

Senator MURPHY:

– No.

Senator DRAKE-BROCKMAN:
Minister for Air · Western Australia · CP

– The Leader of the Opposition is dealing with 2 Bills. The first Bill we dealt with is based on the commerce power; this second Bill is based on the taxation power of the Commonwealth.

Senator MURPHY:
New South WalesLeader of the Opposition

– Did I understand the Minister to say that the first Bill was based simply on the interstate trade and commerce power? I assume he / would extend that to cover also trade and commerce with other countries. He said that the Pig Slaughter Levy Bill is simply based on the taxation power of the Commonwealth to impose taxes on anyone. Is he suggesting that the levy is to be imposed on all pig owners whether or not they are involved in interstate trade and commerce or perhaps trade and commerce with other countries? In other words, is the levy to be imposed on those who are having pigs slaughtered for consumption intrastate?

Senator BYRNE:
Queensland

– I think this is a rather inappropriate subject to canvass with the Minister when he perhaps does not have the appropriate advisers to deal with a matter as complex and as exotic in this context. I do not know whether Senator Murphy proposes to make an issue of this matter, but it could well be raised, with respect to the honourable senator, at another time. To press this question now may in the circumstances be a fruitless pursuit. I only make that suggestion.

Senator MURPHY:
(New South WalesLeader of the Opposition

– I think it is important for us when we are dealing with these Bills to understand the basis on which we are dealing with them. We have had a lot of Bills imposing levies on industries and I think it is important that at least we get the answers. The Minister may be in some difficulty, but he has his advisers here and they presumably know the answers. I am not expecting him to answer from his own knowledge. I would not ask him to supply answers from his own knowledge if he were unassisted by advisers. But the Government has the advisers and I would like to know the answer to the question, through the Minister, no doubt from his advisers.

Senator DRAKE-BROCKMAN:
Minister for Air · Western Australia · CP

– Before I answer this question I would like to say that 9 different industry research Bills have been through this chamber to raise money in exactly the same way as these Bills relating to the pig industry intend that money should be raised. A Commonwealth grant will be made to match the amount raised in levies. Under this Bill the levy is paid by the owner of the pigs when he goes to the abattoir. The answer to the question asked specifically by Senator Murphy is yes. lt is the responsibility of those producing pigs for consumption either intrastate or interstate to pay the levy.

Bill agreed to.

Bill reported without requests; report adopted.

Third Reading

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

page 1662

PIG SLAUGHTER LEVY COLLECTION BILL 1971

Second Reading

Debate resumed from 29 April (vide page 1140), on motion by Senator DrakeBrockman:

That the Bill be now read a second time.

Question resolved in the affirmative.

Bill read a second time.

In Committee

Clauses 1 to 7 - by leave - taken together, and agreed to.

Clause 8. (1.) The following amounts may be recovered by the Commonwealth as debts due to the Commonwealth:

levy that is payable;

an amount that is payable to the Commonwealth under section 6 of this Act; and

an amount that is payable by way of penalty under the last preceding section. (2.) In proceedings for the recovery of an amount referred to in the last preceding subsection, an averment or statement in the complaint, claim or declaration of the plaintiff is evidence of the matter so averred or stated.

Senator MILLINER:
Queensland

– I move:

The Opposition’s objections to a provision of this nature were stated when the Dried Fruits Levy Collection Bill was before the Senate. At that time the Minister and some supporters of the Government said that we were not interpreting this sub-clause correctly. Those honourable senators went on to say that there was no such thing as a penalty payable by anybody against whom an averment or statement was made. I look the opportunity to discuss with some legal friends of mine in Brisbane the statements made by the Minister and by an honourable senator on the Government side who is a member of the legal profession. My friends disagreed with what the Minister and what Senator Withers, who is a representative of the Bar, said.

We all know that there are numerous instances where members of the legal fraternity disagree in their points of view. I suppose our courts would not be so busy unless there was this disagreement. In this chamber today Senator Murphy raised an issue but Senator Byrne questioned whether it was the appropriate time with which to deal with the matter. Senator Byrne felt that it should be raised on some other occasion. Senator Murphy, in his wisdom, said no, it should be dealt with on that occasion. We had the spectacle the other day when the Privileges Committee had to decide upon 2 different legal opinions on an issue which I think to the ordinary layman was clearly a simple one; but those 2 legal gentlemen held completely opposite points of view.

I do not think we can take a great deal of notice of expressions of legal opinion by honourable senators on the Government side. In the debate on the Dried Fruits Levy Collection Bill our interpretation of an identical sub-clause was that a representative of the Minister may go on to any property and thereafter make an averment or statement which cannot be challenged. That is our interpretation of this sub-clause and we are sticking to that interpretation. To our way of thinking it is a completely obnoxious provision and should not be in the legislation. In view of our previously stated opinion in regard to an identical sub-clause in an earlier Bill, and having restated our opinion, the Opposition seeks the deletion of sub-clause (2.).

Senator DRAKE-BROCKMAN:
Minister for Air · Western Australia · CP

– The Government cannot support the motion moved by Senator Milliner. As Senator Milliner said, the provisions in sub-clause (2.) are not new. Similar provisions are incorporated in Acts covering other research schemes involving major rural industries. A provision of this nature is contained in the Dried Fruits Levy Collection Bill, as Senator Milliner said. The power under this provision is not used very frequently, but it is probably the only means by which the authorities on whom this Parliament lays the responsibility for collecting levies are able to collect this revenue from deliberate evaders. Under the provisions of this Bill the collection of the levy will, in the majority of cases, be done by the abattoirs. Well over 90 per cent of the levies will be collected by the abattoirs. The percentage may even be higher.

The power of averment or statement is used to initiate court action. The allegation can quite easily be refuted by production of the required records. Senator Milliner turns away in disgust. Can he tell me how many people would be required to produce records other than abattoirs? This legislation is comparable to that introduced for mutton and beef industry research schemes. We have not had any trouble with those schemes. If this sub-clause is not agreed to then it is quite likely that we will have the old story of more inspectors having to be appointed to police the industry. The industry and the Government do not at this stage want to see this happen. This is why the averment clause has been included in this Bill. The Government cannot support the motion.

Senator MURPHY:
New South WalesLeader of the Opposition

– It is the old story of the civil liberties of the people giving way’ to administrative convenience.

Senator Drake-Brockman:

– Do not say that.

Senator MURPHY:

– The Minister says: Do not say that’. In reply to Senator Milliner he said that a similar provision was put in a number of Bills dealing with the rural industry. We have seen a number- of Bills go through this place which contain extraordinary powers of ‘ invasion of premises in order to get documents. By way of argument and votes in this Senate we have almost corrected this situation and protected the rural citizen from being subject to having his house searched under circumstances in which other members of the community would not he liable to have their houses searched. . Sub-section (2.) states:

In proceedings- -

By the Commonwealth - for the recovery of an amount … an averment or statement in the complaint, claim or declaration of the plaintiff is evidence of the matter so averred or stated.

The general rule in actions for the recovery of debt - and this is a debt which the Commonwealth says is due to it - is that the plaintiff must prove his case. In this sub-clause there is an averment provision in unlimited terms. This does not concern a simple averment or statement by the plaintiff that the person is a slaughterer or conducts a slaughterhouse, or some such simple matter. It is an unlimited power given to the Commonwealth to aver anything it likes. If the Commonwealth likes to aver that a person owes it, say, $8,000 for the year 1971 and so many dollars for some other year, it may do so, and the burden of disproof then rests upon the defendant. Unless the citizen can disprove this the mere statement by the Commonwealth is held as evidence against him. There is a provision in the Bill relating to certificates to which we are not objecting. Clause 12 states:

In all proceedings -

a certificate under the hand of the Secretary or of an authorised person certifying to the inclusion or non-inclusion of a particular name, or name and business address, in the List of Recognised Slaughterers as at a specified date is evidence of the matter certified;

We say that is a reasonable thing with which to agree. The clause continues:

  1. a document purporting to be such a certificate shall, unless the contrary is proved, be taken to be such a certificate and to have been duly given.

There are provisions in the Bill which state that persons are to supply information and that if they do not they will be subject to a penalty.

Senator Byrne:

– That is only like the Government Gazette being evidence without further proof. That is all that amounts to.

Senator MURPHY:

– But why should there be an unlimited provision of this nature under which an averment or statement can be made and then the onus of proof passes to the defendant? In Bill after Bill the Government is breaking down the rights of the people engaged in the industries to which these levy collection Bills apply. Each time the Government uses the excuse that it has been done before to suggest that it should be done again. This provision will spread from laws covering rural industries to laws covering other industries. It is interesting to note that this provision favours the Commonwealth. The Commonwealth always wants to make it easy for itself to collect money and the traditional rights of citizens in legal proceedings will be swept away. I do not see why this provision should not come out of the Bill. I do not see why the Government should be able to have an averment clause in these unlimited terms in the Bill and I do not think anyone who has any real regard for the rights of the citizen would oppose its exclusion.

Senator DRAKE-BROCKMAN:
Minister for Air · Western Australia · CP

– I cannot agree with Senator Murphy who, with all his legal training, gets up here and says: ‘This will be imposed on every producer.’ That is a lot of nonsense. This levy is imposed at the abattoir. The abattoir has to be registered. If the producer wants to kill a pig for his own consumption then he does not have to pay any levy. The levy is collected at the abattoir and any abattoir would have an account of the pigs coming in. The levy deducted is shown on a statement sent out to the owner of the pigs at the time of slaughter. If the Government were given an indication that a particular slaughterhouse was .evading its responsibility of collection then it could use the averment clause to initiate action. All the Commonwealth does is to ask whether it can look at the books. Is this running over the people’s rights? Let us have a look at it-

Senator Murphy says this clause has been included because the Commonwealth Government does not want to do the job ot does not want to pay out more money. This money is raised by the producers themselves and they do not want to pay out money to keep a whole heap of public servants occupied inspecting a factory that may, in the years ahead, evade the collection of levies. What happens is that the Department of Primary Industry has a number of men who are responsible for visiting factories periodically in connection with all these research funds. In some cases they might visit a factory only once in 15 months or so, but if they feel that a particular abattoir has been evading its responsibilities in collecting the levy then they can ask to see the books. Surely this is not doing away with the rights of the individual growers.

Senator MURPHY:
Leader of the Opposition · New South Wales

– I do not know whether the Minister is deliberately misrepresenting the amendment moved by Senator Milliner or is ignorant of the provisions of the Bill. But he is referring to clause 15 which deals with the right to enter premises for the purpose of looking at the books. This is a provision to which no objection is being taken. It is idle for the Minister to do this and he either does not understand the amendment or is putting the position in such a way as to misrepresent the amendment to the Senate. The simple position is that we are not objecting to clause 15 and the Commonwealth will have all the power on earth to go into those premises and inspect the books. Clause 15 states: (I.) An authorised person may, with the consent of the occupier of any premises, enter the premises for the purpose of exercising the functions of an authorised person under this section. (2.; Where an authorised person has reason to believe that there are on any premises books, documents or papers relating to the slaughter of pigs in respect of which levy is, or may be, payable, the authorised person may make application to a Justice of the Peace for a warrant . . .

He can then go in and look at the books. There are other provisions to which we are not objecting which state that a person shall not fail or neglect to furnish returns or information that he is required to furnish and shall not furnish false information or he will be liable to a penalty under the regulations. All that is in the Bill and we are not objecting to it. What we are objecting to is that the Commonwealth, armed with all this material, is additionally able to go into court after the legal proceeding has commenced and say anything it likes which shall be taken as evidence of the offence.

As I said earlier, the Commonwealth could say that an amount of $8,362.15 is owed and the onus is placed on the citizen to prove otherwise. We do not think that should be the law. We think that if the Commonwealth has these powers - and we are not objecting to it having them - and there is a dispute between the Commonwealth and the citizen as to whether money is owed the Commonwealth should prove it and should not simply be able to say that he owes it and that is the end of it. At the moment the citizen has to prove that he does not owe the money. That is the provision to which we are objecting and which we think is wrong.

Senator Drake-Brockman:

– All he has to do is produce his books.

Senator MURPHY:

– If that is all he has to do the position is that the Commonwealth should not commence a proceeding against him unless it is able to show that he owes the money. It has the power to inspect his books before commencing the proceedings. There are penal provisions which can be invoked if he does not furnish the books and that may well be a continuing offence under the enactment. The Commonwealth should not be slipping these averment provisions into these Bills which will undoubtedly be carried on into other measures.

As the Minister indicates, once one starts on this kind of track one keeps extending it, acting on the precedent that one has established. - There should be no such averment provision - not even a limited one - unless there is some real necessity for it. The Minister has not said that there is any real necessity here. He says that there are slaughterhouses, that they are registered, that the books are there and the Commonwealth should be able to go in and see the books. We agree with that. The Minister is saying that this has hardly ever happened. Then why is the law being altered in this way if it will only be in a rare case that proceedings are brought? Why should We have this averment provision shifting the onus on to the citizen? I do not think the Government even realises what it is doing because the departments just like to make everything easy for themselves. When I refer to ‘the Minister’ I am not referring to Senator Drake-Brockman, I am speaking of Ministers collectively, regardless of Party. This might apply throughout the ages because the Minister does not know the effect of these things. He endorses the provision and all honourable senators opposite fight like steam to preserve the provision even though it cuts down the rights of the people. I think the Government should take a good look at these provisions and start eliminating them from the Bills. The Minister has shown no overwhelming necessity for reversing the onus of proof and I do not think this provision should be in this kind of a Bill.

Senator BYRNE:
Queensland

– There is a rather interminable conflict between Senator Murphy and myself in relation to the reconciliation between the rights of individuals and the group rights in communities. This is another exemplification of that conflict. As I sec legislation of this nature, it is legislation which is possibly asked for by those participating in a certain industry in their own interest for the protection of all participants in that industry. If that is so, then if any participant in that industry moves outside the regulatory provisions of the statute it will do great harm to the co-participants and may .ultimately wreck the whole scheme. In those circumstances every participant has a solemn obligation to play his part and to discharge his role properly and to comply with the regulations. If this was a Bill which was designed merely to collect revenue for the Commonwealth that may be one matter. This is a Bill designed to protect the interests of those within the industry. That is the idea of the Bill. Therefore, in framing the legislation in this way, the ‘Commonwealth is going to the maximum extent possible to help those in that industry who require protection from those who move outside the disciplines which are imposed by law.

Generally averments are by no means a new evidentiary practice. In legislation of this character they are particularly common. They are common not only in Federal legislation but also in State legislation in relation to marketing boards and bodies of that nature. They are a type of evidentiary provision which has been inserted by governments of all political complexions, retained by governments of all political complexions and operated by governments of all political complexions. In those circumstances while this averment, on the face of it, may appear to be wide it seems to be one in which, in the practical application of the section before any court, the complaint necessarily would be restricted to matters relevant to establish the offence. In that way the suggestions of wide and irrelevant averments, in my concept, would not arise. In those circumstances this averment is put at the lowest possible level. It is not conclusive evidence. It is merely evidence, and no more than that.

Because this is the conflict in which there has to be some circumscription of the rights of the individual in favour of the communal rights of others associated with the individual and as a means of protecting the other members of the participating group, this averment seems to be warranted. It is true to say that this is a levy on the industry. If it was permitted for people to move outside the industry and if difficult evidentiary provisions were provided involving necessarily the provision of a heavy administrative staff and a heavy superstructure of cost, then the whole purpose of the legislation would be defeated and an intolerable financial burden would be imposed on the industry and on the participants which ultimately would make the whole scheme unworkable. There must be a reconciliation between the 2 groups, the 2 interests. I feel that this is not any unwarranted assumption of the rights of the State or of any authority unduly inserted against . the interests and welfare of the participating individuals.

Senator MILLINER:
Queensland

– I rise again for 2 reasons. Firstly, Senator Byrne’s statement is to the effect that the industry asked for. this provision so that no-one would escape his responsibilities within the industry.

Senator Byrne:

– I did not say that. I said that the industry probably asked.

Senator MILLINER:

– Well, probably asked. That phrase suits just as well. The industry probably asked for this provision.

Senator Byrne:

– I did not say that. I said: ‘For this type of legislation’.

Senator MILLINER:

-Well, for this type of legislation. To which provision is the honourable senator referring? Surely he must be referring to the amendment before the Senate. That is the way we interpreted his remarks. We are entitled to interpret his remarks in that direction.

Senator Byrne:

– If the honourable senator had listened to me intelligently he would have understood.

Senator MILLINER:

– I hope I listened to the honourable senator intelligently. I suggest that he might pay me the same courtesy. If that is the attitude, then it could be said that any industry could ask for a certain provision in legislation, and notwithstanding the fact that such provision may be contrary to the good laws of the land it has to go into the Bill. This is a preposterous situation which could not be countenanced under any circumstances. I refer to the Minister’s reply to me. If ever there was a reason for reinforcing this amendment it lies in what the Minister said. He said that the provision would be used most infrequently. Subsequently he said that we could not delete sub-clause (2.) because if we did we would need to have an army of inspectors and that would add cost to the research programme. Surely we have to balance against those reasons the fact that somebody approved by the Minister can make an inspection somewhere along the line and put in an averment or statement which cannot be contradicted by the person about whom the averment or statement is made.

Senator Byrne:

– Where does the honourable senator find that provision?

Senator MILLINER:

– That is what the Minister said and that is what the Bill provides. I will read the relevant clause to the honourable senator. Clause 8 (2.) states:

In proceedings for the recovery of an amount referred to in thelast preceding sub-section, an averment or statementin the complaint, claim or declaration of the plaintiff is evidence of the matter so averred or stated.

Senator Byrne:

– It does not say’conclusive’ and it does not say ‘irrebuttable’.

Senator MILLINER:

– Senator Byrne is using his legal knowledge. I have no legal knowledge but I am saying that the Minister has said that on a previous occasion in regard to similar provisions.

Senator Little:

– That is what unions do.

Senator MILLINER:

– It has been said by way of interjection that this is what unions do. They can inspect the wages books.

Senator Little:

– One has the right of entry as a union official.

Senator MILLINER:

– If the honourable senator will be patient for one moment I might be able to explain that situation to him.

The TEMPORARY CHAIRMAN (Senator Sir Magnus Cormack:

– Order! I ask the honourable senator to explain it to the Chair.

Senator MILLINER:

– I am sorry. Unions do have the right of entry but the fundamental difference is that having inspected the wages books they are required then to go to court and prove the statements they have made. That is an entirely different situation from that in relation to the averment clause. Consequently I believe that the Minister has reinforced our arguments for the subclause to be deleted.

Question put:

That the words proposed to be left out (Senator Milliner’s amendment) be left out.

The Committee divided. (The Chairman - Senator Bull)

AYES: 25

NOES: 29

Majority . . 4

AYES

NOES

Question so resolved in the negative;

Clause agreed to.

Clauses 9 to 13 - by leave - taken together, and agreed to.

Clause 14. (1.) A person shall not -

Penalty: Two hundred dollars. (2.) A prosecution for an offence against this section may be commenced at any time within three years after the commission of the offence.

Senator MILLINER (Queensland) - (5.0) - I move:

Clause 14 Sub-clause (2.) reads as follows: (2.) A prosecution for an offence against this section may be commenced at any time within three years after the commission of the offence.

The Opposition believes that no logical argument can be advanced for the provision of the period of 3 years. Might 1 remind honourable senators that when the Government first brought in the legislation the period was 5 years. The Government said that that was the minimum period it required for policing the provisions of this legislation. Several honourable senators voiced some opposition to that. The Government took the legislation away and came back with a compromise: It provided that the period should be 3 years. In our opinion, no compromise can be reached on an issue of this nature.

In the vast majority of legislation the provision is for 12 months. We see no reason why that general proposition should be departed from, and provision made in legislation of this nature for a period of 3 years, as is contemplated by the Government. I repeat that there has been quite a lengthy debate on similar issues in the Dried Fruits Levy Collection Bill. The Opposition still holds to the opinion it expressed then. I do not wish to embarrass the Government by suggesting, as I did previously, that in the first instance it said it required a minimum of 5 years and then after rethinking the situation it came in with the compromise of 3 years. The Opposition believes that 3 years is still too long. It is not in accordance with the general code reflected in legislation of this type that the Government should have a maximum of 12 months in which to prosecute. After all is said and done, a time limit of 12 months is the general proposition in legislation and the Opposition sees no reason - and no reason has been advanced up to this point - why there should be a departure from the 12 months, which is generally provided in legislation.

Senator DRAKE-BROCKMAN:
Minister for Air · Western Australia · CP

– The Government cannot accept the amendment moved by Senator Milliner. Let me remind honourable senators that in all legislation similar to this research Bill, other than the Dried Fruits Research Bill, the prosecution for an offence may be commenced at any time. That has been written into all the other industry research Bills. It will be recalled that, because of objection raised in the Senate when the dried fruits legislation was introduced the Government took out the words ‘at any time’ and inserted the words ‘five years’. During the course of the debate honourable senators on all Sides of the House suggested that I should look at this period of 5 years as it was, in their opinion, too long. I did not come to any compromise agreement.

Honourable senators will recall that I asked for leave to report progress. I went away and talked with the Minister for Primary Industry and his departmental officers. I came back into the Senate and, in the debate, I made the point that the Minister for Primary Industry would accept a reduction from 5 years to 3 years. But while accepting the reduction in time, I pointed out to the Senate that in some cases this period would be far too short for the officers of the Department to carry out their investigations into a particular case and that in some instances, because of this time limit, the officers would be forced to speed up their investigations arid perhaps institute a prosecution, when normally they would have given more time to further investigations. In this case the Government believes that 12 months is far too short. It believes that in some cases it may be more than 12 months before the inspectors find that someone has been evading the collection of the levy. If this had to be done within 12 months more inspectors would be needed. .We have been through this argument on a number of occasions in relation to the dried fruits legislation. I have nothing to add, other than that the Government cannot support the amendment.

Senator MURPHY:
New South WalesLeader of the Opposition

– I rise to support the amendment. Here is another case where persons in this industry are being dealt with differently from the rest of the community. The general provision under the Crimes Act in matters of this nature where there is provision for a monetary penalty - in this case it is a maximum fine of $200 - and not a lengthy term of imprisonment, is that the prosecution for the offence shall be commenced within 12 months of the commission of the offence. To illustrate how strong this principle is, it is provided in enactments of most, if not all the States, such as in the Justices Acts, that the prosecution must be commenced within 6 months of the commission of a minor offence. This kind of provision exists all over the world because it is considered to be the policy of the law that minor matters should be either prosecuted by the authorities within a very limited time or not proceeded with. It is not good to have these charges hanging over the heads of citizens for lengthy periods.

The Commonwealth has provided for a period of 12 months in respect of the generality of offences, even offences where short terms of imprisonment - I think up to 6 months - can be imposed. We analysed this matter on a previous occasion. Here the Government has put into the back pages of the rural Bills this kind of provision. There are the averment provisions and was also until we objected a provision that a prosecution for an offence against this section could be commenced at any time. So for the whole of his life a man could be liable to be prosecuted for what is regarded by the law as a minor infringement in the sense that it attracts only a monetary penalty and not even a term of imprisonment. Why should the people in this industry be subjected not only to the averment provisions on the civil side - we have not been told whether there is any limitation on the civil proceedings - but also to this differential treatment in regard to the period during which they may be prosecuted for an offence under this clause.

The Opposition considers that this provision should be amended. It should be brought into line with the generality of other provisions and a period of 12 months should be provided. The Opposition is quite unconvinced by the reasons which have been advanced. There was no justification at all for having a provision in the Bill under which people could be prosecuted at any lime. It was a very wrong provision and it shows that those who put it in did not have very much regard for the rights of the citizen. The Opposition succeeded in the case of a Bill a few weeks ago and in this Bill in at least getting the Government to the point where it has reduced the period to 3 years. The Minister has split the difference between 1 year and 5 years and made it 3 years. He said he is not really compromising. The Opposi tion says that there should be no departure from the general rule applicable to other citizens unless there is the strongest case for a departure. No such case has been shown here and the only way we can stop the erosion of the rights of people is persistently to oppose such clauses. That is what the Opposition proposes to do.

Question put:

That the words proposed to be omitted (Senator Milliner’s amendment) be omitted.

The Committee divided. (The Chairman - Senator Bull)

AYES: 24

NOES: 28

Majority . . 4

AYES

NOES

Question so resolved in the negative.

Clause agreed to.

Remainder of Bill - by leave - taken as a whole, and agreed to.

Bill reported without amendment; report adopted.

Third Reading

Motion (by Senator Drake-Brockman) proposed:

That the Bill be now read a third time.

Senator MURPHY:
New South WalesLeader of the Opposition

– I speak at the third reading stage for a special and perhaps an unusual reason. The whole of the discussion has been concerned with the primary industries of Australia, and those primary industries include the pig industry and other major industries such as the wheat and wool industries. All of those are most important matters to us. One of the things that was discussed in this chamber in recent weeks and which is raised here in discussing this Bill is the relationship of Australia with the People’s Republic of China, particularly the promotion of our primary exports to that country and the breakdown in relations and the export of primary products to that country. I would like to inform the Senate - it bears on the numerous questions which have been raised on the subject matter, mostly by Government senators, as to the outcome of the - matter - that in relation to this question of relations between the two countries and particularly in regard to primary industry, the Australian Labor Party has been informed-

Senator Wright:

– I rise to a point of order, Mr President. This has nothing to do with the Pig Slaughter Levy Bill.

The PRESIDENT:

– I must admit that I was finding difficulty in relating the honourable senator’s remarks to the Bill. I was waiting to see how he was going to develop his remarks.

Senator MURPHY:

– I was developing them in this way: The Pig Slaughter Levy Bill is concerned with one of the important primary industries. In considering this Bill and similar Bills we are concerned with levies, research, promotion and development. If ancillary to that we are concerned with our export industries, I would be surprised if any honourable senator tried to stop a discussion of one of the most important matters which concerns those primary industries, which include the pig industry and pig exports. Therefore I inform the Senate that the following message has been received by cable:

We have learnt about your cable to Premier Chou En-lai dated April 14. Our Institute will welcome an Australian Labor Party delegation to China in mid-June or the latter part of June for discussions on questions concerning the relations between the two countries. To this end, please cable our Institute the names of the delegation members, their passport numbers, the date of departure and the route to China.

Chinese People’s Institute of Foreign Affairs, Peking, May 10 1971.

No doubt the Senate will be pleased to learn of that. We hope that it will lead to more amicable relations not only in primary industry affairs but generally.

Question resolved in the affirmative.

Bill read a third time.

page 1670

LOANS (QANTAS AIRWAYS LIMITED) BILL 1971

Second Reading

Debate resumed from -4 May (vide page1 1328), on motion by Senator Cotton:

That the’ Bill be now read a second time.

Senator KENNELLY:
Victoria

– The purpose of the Bill in the first instance is to allow the Commonwealth to borrow $US29.58m, which I. understand is equivalent to $A26.4m, . together with $US30m, which is equivalent to $A26.8m. The first amount that I mentioned is to be borrowed from the Export-Import Bank and the amount of $US30m will be borrowed from a number of banks in the United States, including the Chase Manhattan Bank of New York] The purpose of borrowing this money, is. to help Qantas Airways Ltd to finance the purchase of 4, Boeing 747 jet aircraft, together with related equipment. These borrowings are by no means the first approved for the’ purchase of aircraft, whether they be for Qantas or for Trans-Australia Airlines. I believe that in the early days of the air industry in this country Australian National Airlines, now Ansett Airlines of Australia, had money loaned to it for the purpose of getting the fleet started. Of course, in later years Ansett, through various means, has been able to find its own finance. The whole of the loan will be made available to Qantas for the purpose I have stated and on such terms and conditions as the Treasurer of the Commonwealth states. Naturally all the costs of the transaction will be charged against Qantas. The interest charged, according to the Bill, will be not more than 7 per cent. In the unfortunate circumstances of today, one cannot say that that rate of interest is excessive, because if I remember correctly, for some loans, and particularly semigovernment loans, the interest rate is about 7.25 per cent.

The Minister for Civil Aviation (Senator Cotton) has informed the Senate that the

Australian Loan Council has approved the borrowing of this money. It may be of interest to note that in the 11 years prior to 1968 the Commonwealth has been the borrower of approximately $US289m from the various banks in the United States in order that aircraft could be bought by Qantas. I see nothing wrong with the Bill. In the past - as I have said before, as far back as the 11 years prior to 1968 - we have supported the borrowing of money by Qantas. In other words- we have acted as guarantors for Qantas in the purchase of aircraft. Qantas accepts full responsibility for the loans. This Bill gives us an opportunity to discuss certain matters currently relating to Qantas. One cannot help but be surprised by the administration of Qantas. Suddenly, within a few- months of advertising for pilots and engineers, Qantas gave notice to certain of its personnel.

Senator Devitt:

– There were 155 of them.

Senator KENNELLY:

– The honourable senator mentions an overall figure of 155. I have been fortunate enough to obtain from the Parliamentary Library copies of articles dealing with the position of Qantas that were published on 23rd April in the Australian Financial Review’. It is true that there has been a decrease in business in the aviation industry, not only in the international sphere but also in the domestic sphere. Honourable senators will have noticed that the services to Canberra provided by both internal airlines have been reduced. The aviation industry has enjoyed a rather unique position in that its business has increased from year to year. The increase in passenger traffic carried by the domestic airlines has been remarkable, and Qantas has enjoyed a similar position. Australia must be proud of Qantas. It flies our flag with distinction in countries across the world. However, it is experiencing a downward trend in that the rate of growth of business has not been maintained. In addition, Qantas has advanced the argument popular amongst employers that it has been adversely affected by the 6 per cent increase granted by the Conciliation and Arbitration Commission in the last national wage case, some months ago. That increase was granted to Australian wage earners. Although air pilots are few in number, they are tremendously powerful industrially and are able almost to hold the airlines to ransom.

Throughout a long life I have never minded people trying to sell their labour on the best market. As Qantas pilots have only their labour to sell, their industrial attitude is understandable. However, I have read in today’s Press that the captains of jumbo jets are expected to earn at least $25,000 a year and could with extra duty earn more than $30,000 a year. I cannot help but wonder who is to carry the weight of those salaries. I believe that any man is worthy of his hire, but when the cost of his hire becomes astronomical I cannot but wonder where it will stop.

Qantas inserted in its own publications advertisements for air crew positions. I understand that it even wrote to people employed by other airlines and attempted to entice engineers and pilots into its employ. Then, for some remarkable reason that seems to indicate an extreme lack of good planning, Qantas , gave notice, according to the ‘Australian Financial Review’, to about 74 pilots. I hope that that figure is correct. A number of engineers were also given notice. One of the reasons given by Qantas for its action was the decision of the Government to reduce by about 30,000 the number of migrants being flown to Australia by Qantas. Captain Ritchie, who is spokesman for Qantas, said that a certain number of pilots would therefore have to go. I can understand that any industry must find gainful employment for its staff, but surely there is a need for forward planning. International aviation is not a small industry. Qantas has not made a loss in recent years. Even after paying 7 per cent interest to the nation last year it made a profit of about $5m. Qantas is in business to make a profit. If it does not make a profit, the loss it sustains must be found somewhere. I repeat that Qantas advertised for personnel to help to run its business, and within a few months it gave notice to some of its employees. To my mind that is not good planning.

I appreciate that the growth rate of the aviation industry has not come up to expectations. In recent years both the international and domestic airlines have shown a remarkable increase in passenger traffic. Certain steps were taken to combat the effects of inflation. If great care is not taken there could be a repetition of the bad times of the 1930s. Perhaps the position will not be as bad, but it could happen along the same lines. An industry cannot be run successfully without forward planning. It seems to me that in view of the situation that arose in Qantas somebody in a high position of trust was a very bad judge. I make that statement on the basis of the action taken by Qantas in giving notice to pilots and engineers within a few months of advertising vacancies in those positions. The air pilots award provides that 6 months notice of dismissal is necessary; 74 of them were given notice.

The Government has something to answer for regarding the downturn in the number of migrants carried by Qantas. I am informed that it is cheaper for newcomers to be brought to Australia by air than by sea. Considering the position in which Qantas finds itself and the fact that it is to carry 30,000 fewer passengers to this country because of reduced immigration, one would have thought that the Government would have ensured that newcomers to Australia would have travelled by air because, firstly, as I said I am informed, it is cheaper and, secondly, Qantas would not have been placed in a position in which it was not operating the number of flights which it could operate.

I see no reason why the civil aviation industry should not be looked after. I am quite certain that if Qantas had anything to do with the wool industry, the wheat industry, the pig industry or any other primary industry outside the metropolitan area, my friends in the Country Party corner would have yelled so much that the Government immediately would have rushed to Qantas’ aid and said: ‘Everyone who wants to come to Australia as a migrant or a new settler has to come by Qantas.’ But, of course, Qantas is not represented by the 6, 7 or 8 members of the Country Party who sit in the corner of the chamber, and therefore it takes a little time for the position regarding Qantas to sink in. I believe that the Commonwealth Government has an obligation to act as the guarantor of the loan to be made available to Qantas. The Government has done this for many years, and of course there has been no thought of the Government’s losing money because Qantas has not been able to meet its commitments to the Gov ernment as the guarantor of the loan. But the Government also has an obligation to assist in obtaining business for Qantas If the price is right. I think that that ought to be done by the Government.

I know that over the years the Government has always been friendly with international shippers. Could I ask it not to be so friendly in this instance? The Government has a national shipping line which it allowed to join a conference line. It did so for one reason: So that the farmers and others could get cheap freight rates. But, of course, when the Australian National Line joined the conference line that line laid down the freight rates, and our shipping line is more or less a joke as far as helping people who send goods away from this country is concerned.

There is one thing in the First Schedule to the Bill which is of great interest to me. Qantas is to buy planes and the price which it is to pay is set out. It is also set out that the Commonwealth guarantees the money, and one could not have better security. But Qantas cannot fly its planes where it wants to. Paragraph (d) in section 8 of the First Schedule states:

No aircraft or related equipment the purchase of which is financed, in whole or in part by Eximbank under this Agreement (i) is principally for use in a Communist country (as defined in Section 620(f) of the Foreign Assistance Act of 1961, as amended) or (ii) is to be used principally in any nation (a) which engages in armed conflict, declared or otherwise -

We are used to taking part in armed conflicts that have not been declared. How do we get on if Qantas wants to fly to Vietnam? Have the Americans declared war in Vietnam? I know that we have not done so. It continues: with armed forces of the United States or (b) which furnishes by direct governmental action (not including chartering, licensing or sales by non-wholly owned business enterprises) goods, supplies, military assistance, or advisers to any nation described in Clause (a) above.

To say the least, that seems to be a remarkable condition. I do not blame Boeing or the Americans for including it in the agreement. I suppose that they have things in their planes which they want to hide and which they do not want copied. But what does the designation ‘Communist country’ mean? One can say that Russia and China are Communist countries, although 1 understand that they have different sorts or brands of Communism.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– Then there is Yugoslavia.

Senator KENNELLY:

– Yes. We signed an agreement to bring people from Yugoslavia to Australia. We give them a better go than we give to people from Malta who are British subjects. J remember some time ago drawing the Government’s attention to the case of the young lad who comes from Yugoslavia to Australia having served 6 months in the Army of Yugoslavia. First of all, he can leave Australia if he gets a call-up notice for national service when he is 20 years of age. He docs not have to serve. But if he wants to serve, the 6 months which he has served in the Army of Yugoslavia is deducted from the 2 years which he is required to serve in the Australian Army. I take it that these planes of Qantas will not be able to fly to Yugoslavia - if it is called a Communist country. But the most remarkable thing is - and I have never blamed the United States for protecting itself - that the United States, on behalf of Boeing, has said: ‘There may be some mechanism in these planes which we believe other countries have not got and which we want to see they do not get.’ That is a fact of life in the world in which we live today. But, of course, that is a remarkably different approach from the one which we adopt. Australia has merino wool, South Africa may have some merino wool and New Zealand has some merino wool. They are the 3 principal merino wool producing countries. But, of course, we do not do what the Americans do. They at least protect their planes. But we are very magnanimous. We believe that the easiest way to help Australian wool farmers is to sell-

Senator Little:

– Is not this getting a little wide of the Bill?

Senator KENNELLY:

– It may be to Senator Little, considering his record in the past. According to the Government we should use every effort to get our rams away so that we will have another competitor in another part of the world. I am drawing an analogy-

Senator Sir Kenneth Anderson:

– A passing reference?

Senator KENNELLY:

– That will do. I am drawing an analogy between what we do to an industry such as the wool industry - a very important industry - and what we do under this Bill. Under the clause that I have read we agree to lend money to Qantas to buy aircraft.

Senator Prowse:

– Aircraft do not breed.

Senator KENNELLY:

– That is worse. The merino rams do. It seems to me that we have agreed to the aircraft being purchased under certain conditions, and what I have read is one of those conditions. I hope that when the Minister replies to the second reading debate he will tell us the countries to which these aircraft are not permitted to go. World events are changing. We may or may not be recognising certain countries in the near future because world affairs are rapidly changing the views of a number of people and a number of countries. Let us hope that that will lead to more friendship between nations. I think the date of delivery of the last aircraft to this country is 1974. I do not think that any honourable senator is prepared at this time to say whether wc will have recognised China by 1974. If, under the clause that I have read, the Americans consider China to be a Communist country and one to which these aircraft should not fly, they can say to Qantas: ‘Here is the bargain. Using these aircraft, you cannot fly from any part of Australia to China’. No doubt Qantas recognised that restriction and agreed to it. Qantas would not have bought the aircraft otherwise.

I hope that Qantas used a little more foresight in agreeing to the terms of purchase than it did when dealing with its internal affairs. Its handling of its recent internal dispute does not give me much faith in its supposed extraordinary capabilities. I was told by some of the flight engineers who were here a week or so ago that Qantas was attempting to get people to leave one international airline or even our internal airlines to join Qantas. Letters were produced to show that Qantas was enticing people to join its organisation. In a very short time - a matter of months - the axe has fallen. While the Opposition does not oppose the Bill, I would like the Minister for Civil Aviation in his reply-

Senator Sir Kenneth Anderson:

– I will be replying, not the Minister for Civil Aviation.

Senator KENNELLY:

– With no disrespect to the Minister for Supply, I hope that the Minister for Civil Aviation will take part in the debate because he might have more intimate knowledge of affairs covering the last month or so. I’ read that the Minister for Civil Aviation was taking part in discussions between the Department of Civil Aviation and Qantas. I know that one night the engineers had an appointment with him. This is our only international airline and we should know exactly the present position. I hope that the Bill succeeds. I hope that Qantas does not get as rickety in such a short time in the future. 1 hope that it continues to carry our flag to the 4 comers of the world.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– the Minister for Civil Aviation (Senator Cotton) said that the purpose of this Bill is for the Parliament to approve borrowings by the Commonwealth of $A26.4m from the Export-Import Bank of the United States and the Boeing Company, and $A26.8m from a syndicate of United States commercial banks led by the Chase Manhattan Bank of New York to assist in financing the purchase of 4 Boeing 747 aircraft and related equipment, spares and services estimated to cost $A125m. I think that this is the tenth or eleventh occasion on which parliamentary approval has been sought by the Government for a borrowing by the Commonwealth in the United States of America on behalf of Qantas Airways Limited. Between 1957 and 1968 over $A258m has been borrowed from the United States. At 1st April last nearly $A80m had to be repaid.

The Opposition, as Senator Kennelly has said already, supported the earlier measures which sanctioned certain pre-delivery payments on the aircraft, and on this occasion the Labor movement offers no objection to the financial aspects of this measure because we realise that Qantas, in this highly competitive aircraft industry, has to have the equipment and the aircraft to be able to compete effectively on an international basis. Nonetheless, I strongly endorse the remarks of Senator Kennelly, who led for the Opposition, in suggesting that Parliament should have been given more information and should now have available to it more knowledge of the financial ramifications and the situation of

Qantas than we have. I would have hoped that by this time the Minister for Civil Aviation would have made to the Parliament and to the Australian people a ministerial statement on the financial situation confronting Qantas. We have asked questions of him at question time and we have obtained certain information from him in the course of his answers.

Because Qantas is Australia’s international airline, because it is so vital to this nation and to the Australian people and because we are led to believe that it is in some financial difficulty, we believe that it is the responsibility of the Government to lay the cards on the table and to tell the Australian Parliament and the Australian people the exact situation so far as this great international image for Australia is concerned. There is no doubt that Qantas presents a tremendous image for Australia internationally. All of us know that this great Australian airline has the world’s best safety record. Its service, as everyone who has travelled on it will tell you, is second to none.

Senator Sir Magnus Cormack:

– Rubbish.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– You say that that is rubbish. I say that from my experience - I know that countless thousands of Australians support me - its record of service is second to none. I am sure that it came as a great shock to all Australians in recent weeks to hear of its financial difficulties and the retrenchment of 1 55 air crew personnel.

Senator Kennelly:

– Is it in financial difficulties?

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

–

Let us find out. Let us ascertain what the situation is. If it is putting off 155 aircrew personnel, what is the reason for that? The last annual report tendered to this Parliament by Qantas painted a rosy picture; but now we hear of a retrenchment of pilots, a tightening up and a drawing in of the belt. We are entitled to know what the real situation is. Let me read one or two passages from the last annual report of the Board of Directors of Qantas to the Minister for Civil Aviation. On page 2 the report stated:

It is pleasing to report a further increase in profit and substantial gains in traffic at a time when we are celebrating the Company’s fiftieth year of operation.

Net profit for the year after providing for taxation

I emphasise those words - , . was $8,166,000, compared with last year’s profit of $7,119,000.

The profit does not include a net capital surplus on the sale of assets amounting to $1,809,000 which has been transferred to the Development Reserve.

The Directors recommend a dividend of 10 per cent which will absorb $3,940,000.

Total revenue reached $198,939,000 an increase of 16 per cent over the 1968-69 revenue of $171,491,000.

Significant gains were achieved in both passenger .and cargo traffic. Revenue passenger miles increased by .16.7 per cent, cargo ton miles by 17.2 per cent. Revenue from charter operations totalled $22,965,000, a 56.6 per cent increase over the -previous year.

Expenditure increased, by 14 per cent to $185,142,000. Most cost items felt the impact of wide-spread increases in salaries, wages and prices throughout the year.

Generally in those 6 or 7 paragraphs from the report to the Minister by the Board of Qantas a rosy picture was painted, with increases in revenue and in passengers and cargo carried. Yet suddenly within the last 3 or 4 weeks- we hear of the possible retrenchment of 155 aircrew personnel. Throughout the report there were details of other , expansions of activity, such as development of the Sydney jet base, construction of a new San Francisco office, construction of new Qantas headquarters, installation of a new computer complex, hotel development and so on. Then the purchase of these Boeing 747B aircraft was dealt with. On page 14, on a rather proud note, the report said:

We will be the first airline to put into service the more powerful long range ‘B’ version of the 747. The 747B will have a greater maximum takeoff weight and will be quieter than the earlier model 747 now in service with several airlines in the Northern Hemisphere.

Doubtless those aircraft are the ones that have brought about this Bill. Now, beingwiser after the event - one naturally becomes concerned when there is talk of the retrenchment of so many people - one can read warnings as appearing in the last annual report. For instance, on page 5 mention is made of the overall rate of revenue per ton mile.

Sitting suspended from 6 to 8 p.m.

Senator DOUGLAS MCCLELLANDPrior to the suspension of the sitting I was speaking on the Loans (Qantas Airways Limited) Bill and I had asked the Government to explain the real financial situation in which Qantas found itself. I had referred to several passages in the last annual report issued by Qantas which seemed to indicate a quite rosy picture of increased passenger traffic and increased cargo handling with an increased profit. Then suddenly, out of the blue, we heard about the retrenchment of 155 of the company’s air crew. Having heard of this I read the annual report again. As I said earlier, it contains several passages which hint that there might have to be a tightening of the belt. I shall take the liberty of referring to one or two of those passages. The report states at page 5:

However, the overall rate of revenue per ton mile for all traffic, including carriage of migrants: and affinity groups on charter, flights, fell slightly from 43.4c in 1968-69 to 43.2c in 1969-70. This was because of the increasing proportion of charter traffic travelling at rates substantially below commercial levels.

At page 8 of the report there is an indication that airmail revenue had fallen from 9.7 per cent of total traffic revenue in. 1968-69. to 8.8 per cent in 1969-70, compared with 14 per cent 5 years earlier. Without referring to all the items to which one might refer if one had time, I pass on to the conclusion to the report in which, this appears:

During the past decade the Company has grown very rapidly - from revenues of $68m in 1960-61 to almost $200m in 1969-70. With predictions of an upsurge in international air traffic in the years ahead, we see Qantas entering a new period of long-term development and continued vigorous growth. However, as we progress into the seventies, it becomes more evident that competition from foreign airlines operating into Australia will become increasingly severe. Increases in total capacity provided are tending to exceed increases in traffic, a situation which must ultimately lead to deterioration in financial results.

I do not know whether Qantas is in a financial predicament - I do not think it is, and I certainly hope it is not - but we would like to know what the real position is. We are led to believe by the Australian Federation of Air Pilots that Qantas’s profit this year will be about $5m. after tax, as against a profit last year of $8m, after tax. Doubtlessly because of the lower migrant intake and other circumstances, including charter flights and off-schedule nights by other companies, a close look at the situation is needed. I hope that during the course of this debate the Minister for Civil Aviation will give some real account of the actual financial position of Qantas, because there have been conflicting reports.

The Genera] Manager of Qantas stated that last year the company estimated that there would be a S3.4m increase in expenses for the year ahead but that, in respect of wages, in December an additional 6 per cent was added by the national wage increase, followed 3 days later by an additional 18 per cent increase for Qantas clerical and graded staff. He said that there has been a drop of 30,000 in the number of migrant passengers carried, which I understand is equivalent to about 3 flights a week, requiring the services of about 45 pilots, and that the intake of stewards and hostesses would drop by 150 or 160. On the other hand, as I have said, the Federation of Air Pilots has stated that Qantas is in a reasonably healthy financial position and can expect a profit of about $5m this year. It has said that not only is it in a reasonably sound financial position but also that it is in a much sounder position than any other international airline company, including particularly Pan American World Airways, which I understand showed a substantial loss of about $US50m and a British company which was showing a loss of between $10m and $12m.

Whatever is the real position, it certainly appears that the situation this year will not be as bright as it was last year. But surely, as my colleague Senator Kennelly mentioned earlier, some of these things should have been foreseen by the Qantas management much earlier than they were and steps should have been taken to correct the position much earlier rather than suddenly, overnight, deciding to terminate the services of so many trained pilots and other air crew. I propose to give one or two illustrations. Last year I placed on the notice paper a couple of questions referring to the Qantas cadet pilot scheme. On 20th October last in reply to a series of questions I had placed on the notice paper I received this answer:

There are at present Qantas pilots who are graduates of the Qantas Cadet Pilot Training Scheme employed in the general aviation industry. They are not awaiting full time flying duties with

Qantas, but are flying in general aviation as an extension of their initial training. This further training is to enable them to further their experience prior to taking their place in the crew of a Qantas overseas operation.

The salaries are not subsidised by Qantas. Up to 3 months of their IS months period in the general aviation industry is allowed for further training with the general aviation operator to allow the Qantas trainee to become proficient in his general aviation role. During this time-

I emphasise this to the Minister - the training costs and the living allowances for the pilot are met by Qantas.

It can be seen from that answer that a pilot who has been trained by Qantas and who is working in general aviation is receiving training costs and living allowances from Qantas for a period while he is employed in the general aviation industry. The answer continues:

This, of course, allows the Qantas training to be spread to some extent through the general aviation industry and so be of benefit to a broader section of the industry.

Later in the answer the Minister said:

In view of these undoubted advantages, no objection can be raised to this practice of enabling the pilots concerned to gain ‘on-the-job! experience prior to undergoing further training on Qantas aircraft.

On 2nd November, a fortnight or so after I had received that answer and had placed question No. 777 on the notice paper, I received from the Minister a reply which stated, in part:

In the circumstances, there is no evidence to suggest that the Qantas cadet pilot employment arrangements should be discontinued, particularly in view of the advantages of the scheme which were conveyed to the honourable senator on a previous occasion.

Now, despite the scheme which has been in operation for some years, we are told suddenly that no jobs are available with Qantas for about 150 pilots. It appeared to me when I asked the questions to which I have referred that Qantas was overcapitalising on pilot training, but the answer which came back said that there was no evidence to suggest that the Qantas cadet pilot employment arrangement should be discontinued in any way. I have received another complaint which has come to me from the New South Wales branch of the Association of Architects, Engineers, Surveyors and Draughtsmen of Australia concerning the introduction of a fourth shift for Qantas simulator technicians. Members of that Association say that the company in introducing a 4-shift system is in breach of the Aircraft Radio Engineers and Simulator Technicians (Qantas) Award. Clause 18, paragraph 4(f), of the Award makes provision for 1, 2 or 3 shifts only and for measures for agreement to be reached between the parties before any change in status takes place. They point out that whilst the company is sacking pilots to save money it is about to make 26 members of the Association work extra night shifts for no good reason and, apparently, at greater expense to the company. The management of Qantas has to learn that if an enterprise is to be successful, it has to run harmoniously and I believe, after talking to a number of trade union officials who have regular dealings with Qantas, that much more harmony can be brought about in the company’s industrial relations programme.

I sincerely trust, as do all members of the Opposition, that this great Australian enterprise will be able to get itself back into a healthy financial position. Nonetheless, I think that enormous difficulties lie ahead for the company in view of the international competitive operation of world airlines. For instance, only last weekend, there were full page advertisements in the Sunday newspapers giving reasons why one should travel with an international operator, which is a competitor of Qantas, between Australia and the United States of America. No doubt more passengers and more freight will be needed, especially in the jumbo jets which will be travelling to and from Australia with large distances involved. However, one thing that the Government must look at - I suggest this quite seriously - is the situation of a Qantas aircraft leaving Australia for London with a full load of passengers most of whom get off at Singapore and travel from Singapore to London in off-schedule flights of other operators. At present Qantas planes are leaving Australia for London with a full complement of passengers to Singapore but flying virtually empty from Singapore to London, whilst independent operators who are not members of the International Air Transport Association are operating, at greatly reduced prices, off-schedule services between Singapore and London.

According to the last annual report of Qantas, the last decade was one of pro gress. The next decade will certainly require all stops out on the part of everyone. On page 14 of the last annual report of Qantas, supersonic aircraft are mentioned. The report states:

Flight testing of the Anglo-French’ Concorde is proceeding satisfactorily. We are continuing to evaluate the technical and economic .capabilities of this aircraft for Qantas routes.

If options on four Concordes are subsequently confirmed by the company, deliveries can be expected in 1974-75.

Today, Qantas is borrowing for the purchase of 4 jumbo jets and in another 4 years, if this report is implemented, it will be borrowing for 4 Concordes. The report continues:

The United States Government has allocated funds for the construction of 2 prototype Boeing supersonic transports. These aircraft will be faster and will have a greater passenger capacity than the Concorde.

Qantas has an option for 6 of the United States supersonics. Delivery of these could not be expected before 1978-79.

So, this heavy capitalisation cost will go on if the rat race between international operators continues. Frankly, my opinion is that the Concorde will not be a satisfactory aircraft for Australia because principally and predominantly it is a passenger aircraft and not a freight carrying aircraft. Because of the long distances involved between Australia and other quarters of the globe, we have to rely on aircraft which carry not only passengers but also freight.

Senator Prowse:

– What about using the jumbo for the carriage of freight?

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

–

The jumbo jet can be used to great advantage for freight operations. The Opposition has no objection to the jumbo jets and is not opposing this Bill. I am pointing out that there are grave indications ahead that, if Qantas is in a sticky situation today, the situation is going to get stickier as the company involves itself in heavy capital expenditure in the purchase of Concordes and other supersonic aircraft. Involved in the whole of the aircraft industry is an attitude of keeping up with the Joneses. If one company gets a late model aircraft then another company must go in for it also. I urge caution and restraint in such purchases until the company is absolutely certain that they are good, economic propositions for the successful operation of Australia’s international airline.

Finally, I pay tribute to all those who serve and have served this company so well - the pilots, the stewards, the hostesses and the ground staff. I reiterate that in my travels with Qantas I have never had reason to complain about the type of service accorded the travelling public. I trust that this excellent service, which is second to none in the world, will continue to attract international travellers so that the good reputation and image of this nation will not be tarnished greatly because of some temporary economic difficulty or setback. The Opposition supports the measure.

Senator DAVIDSON:
South Australia

– I am pleased to take part in this debate tonight, even if only to return to the measure that the Senate is discussing, that is, the seeking of parliamentary approval for a sum of money to be used to purchase or to complete the purchase of certain denned aircraft for the ongoing work not only of Qantas Airways Limited as an airline in itself but also to enable Australia to take its place in the international passenger and freight carrying service. I remind the Senate that, in simple terms, the Bill seeks the approval of Parliament for the borrowing of $US29.5m which, if I remember the conversion correctly, is somewhere about $A26.8m, to assist in financing the purchase of jet aircraft for Qantas. The Minister for Civil Aviation (Senator Cotton) has laid down the details of the borrowing and servicing and generally the necessary arrangements in a complex international exercise of this kind. As I said, the amount is to assist in the financing of the purchase of jet aircraft and. particularly, to complete the financing of the purchase of 4 Boeing 747 aircraft and their related spares and general service.

We have heard a lot in this debate tonight and we have read much of the debate which took place in the other chamber about Qantas. As everybody has said and as everybody well knows, there has been a series of questions and answers - I emphasise the word answers - in relation to the operation of and the general circumstances relating to the present position of Australia’s flag carrier, its inter national airline, Qantas. Its very name is distinctive to our country - Queensland and Northern Territory Aerial Services - and I think it takes on a quality of identification with Australian life and Australian history that is unique. I hope that as time goes by, unlike other countries which have found it necessary to change the name of their international flag carriers, we will not have to do so because the name Qantas is quite distinctive and historic. Its very title indicates some of its origins and its involvement in our national growth and international relationships.

I read somewhere - I cannot remember where - of somebody, equating the relation-, ship of Australia with Qantas in something of the same category as England’s relationship with Rolls-Royce. Perhaps this is stretching the comparison a little further than I normally would like to do. I well remember having the privilege of sitting in the gallery in the House of Commons in London only a few months ago on the very day that the British Minister related to the House of Commons the crisis in Rolls-Royce. One detected an instant sense of dismay and concern because of this sense of identification with the Rolls-Royce company. Whether we identify Qantas with Australia in the same way, I do not know, but all of us have been concerned at recent developments which have taken place as far as Qantas is concerned.

Senator Douglas McClelland, who has just resumed his seat, paid tribute to Qantas and expressed his concern about the wellbeing of our international air flag carrier. We must bear in mind the size of Australia. We must remember that in comparison with other countries which have international flag carriers we are a small country. We have had to compete with airlines operated by great and heavily populated countries. It is quite remarkable that we have been able to maintain, through the years, a service of the quality and efficiency of Qantas.

I take early opportunity to defend Qantas against criticism of its service and facilities. I had the very great privilege of travelling on international aircraft on quite a few occasions in recent years and a considerable amount of that time was spent in flying with Qantas. I reject the comments made about frustrations over hotel booking and all the other silly nonsense. I think if you play your part as a traveller and do the things required of you, Qantas responds better than any other airline to the needs of the international traveller. I have never failed but to be proud of the service given by Qantas and, as other speakers have said, its international safety record.

We have to acknowledge that even while Qantas takes its place in international transportation it has to do something which other carriers do not have to do and that is to travel what I call the extra miles. In this way Qantas is different from the airlines , which operate in the concentration of Europe, the Americas and South East Asia. This is reflected in the Qantas report which draws attention to the fact that passengers on Qantas services travel a longer average journey than with any other airline in the world and because of this those passengers have to be serviced. Their needs have to be met and their accommodation and other facilities have to be arranged.

I must turn to the Qantas report because it is from that basis that this Bill springs. The Bill is an expression of the on-going nature of Qantas, its requirements, needs and programme. The report of Qantas tabled in the Senate referred to the increase in revenue passenger miles. It mentioned an increase in what is called the seat mile capacity offered on Qantas. The last report mentioned a decline in the seat factor but stated that there had been an increase in the air cargo field. I notice however that there was a decrease in the carriage of air mail. In this discussion we must do more than just lift odd references and odd statistics out of a report. We must consider all the other subjects necessary to meet the requirements and demands of a modern airline. I do not suppose there is anything in modern international commerce, business and movement today which requires so much detailed and up to minute attention than a modern airline. I refer to such things as marketing to meet the heavy competition and the promotion of all phases of international travel. In the report there are references to what are described as affinity groups, youth travel, charter operations and a wide range of other movements of people. There is the importance of the airline company’s investment in other companies and the expansion of what might be described as the home base, the jet base in Sydney. All of these things must keep pace with world competition.

I direct the attention of the Senate to a booklet put out by Qantas to mark its 50th anniversary - the period from 1920 to 1970. It highlights some of the problems Qantas has faced. I refer particularly to the page headed ‘International Agreements’ where it states that Qantas carried some 700,000 passengers last year compared with 14 million on United States international airlines, 9 million on United Kingdom airlines, 5 million on French airlines and 3 million each on the Canadian, German, Swiss and Italian airlines. Qantas is more than able to hold its own against these quite remarkably high figures showing, the movements of vast numbers of people.

Senator Byrne:

– What was the Qantas figure again?

Senator DAVIDSON:

– Our figure was 700,000 passengers compared with 14 million carried by the United’ States international airlines and 9 million ‘ by the United Kingdom airlines: A number of other countries are mentioned. When talking about the movement of people we must remember that they have to be serviced. I refer to such things as baggage, meals, ground transportation’, office facilities and all the other things that go with this business. I pay my tribute to Qantas because it has done these things in competition with much bigger airlines and much larger nations. Yet now, in spite of the difficulties that confront the. international airline business, it is taking, practical and realistic steps for its on-going development into areas the details of which are not comprehended by the average travelling person.

I have been very interested in the page in this Qantas 50th anniversary booklet which refers to its share of the passenger market. It is more than remarkable that we have been able to hold our own in this sphere. I want to take a moment of the Senate’s time to quote a particular reference in this booklet. It states:

Eighteen foreign international airlines now operate into Australia and eight more have indicated that they would like rights into Australia despite the fact that Qantas does not land or wish to land in their home countries.

The document goes on to state:

If no significant flow of travellers exists between the foreign country concerned and Australia, then the effect of licensing another carrier must be to take away traffic which is rightfully Qantas’.

Further on it is stated:

Traffic rights are a valuable commodity which are traded,-

Traded, mark you. not given aw.ay. The disappointment of other airlines who don’t win the traffic rights into Australia they want is understandable, but horse trad.ing is a frustrating business if you don’t have a horse. 1 rather suspect that the Minister for Civil Aviation might have written this segment of the report. However, returning to the details of the prime purpose of the Bill before the Senate, the funds required are for the purchase of a series of Boeing 747 aircraft which are commonly and familiarly known as jumbo jets. The jumbo jet, the 747, is the latest instrument in large scale air movement. Whether we like it or not we have to accept the fact that if we are to operate in the international airline field we must have modern aircraft. It may be that the Boeing 747 aircraft are creating problems at the moment. We will just have to face up to the problems. The Bill which is before the Senate tonight is designed to do just that.

According to information which I have obtained the Boeing 747 was designed to carry 32 standard road-rail containers, each 8 feet by 8 feet by 10 feet, or up to 490 passengers, sitting 10 abreast. There is room under the cabin floor for 15 containers each of 350 cubic feet. The gross take off weight is described as being 680,000 lb, though this will certainly move up to over 700,000 lb because of the natural growth of aircraft in the developmental stage. Speed is not the only reason for the purchase of Boeing 747 aircraft. The approach of the airlines is that this unit could lead to the cutting down of operating costs because of its size and its more efficient engines, with the extra cruising speed being something of a bonus. I have had the opportunity of travelling in a Boeing 747 on a 4 or 5-hour journey.

Senator Poyser:

– Jolly good luck to you.

Senator DAVIDSON:

– I appreciated the privilege of travelling in one of these aircraft. It was a wonderful experience. However, I must admit that I did not enjoy it because the aircraft was too big. There were 368 people in the Boeing 747 in which I travelled. It should be remembered that this Bill seeks approval for the purchase of 4 of these aircraft.

Senator Cant:

– Where will we get the people to put into them? The aircraft are flying half empty now.

Senator DAVIDSON:

– The aircraft I was in was not half empty, it had 368 people in it. It took me a long time to get a meal. Indeed, one of the problems with travelling in that aircraft on that occasion was that the various services and facilities were so much in demand that people had to queue up throughout the whole of the journey. Nevertheless, I pay a tribute to the skill of the people who designed, built, and fly this aircraft and take the responsibility for carrying safely and comfortably such a large number of people. There is, of course, more in this measure than the securing of authority to secure the loan and acquire these aircraft. Because Australia is in the international transportation field it has a long range involvement in using the . most sophisticated and contemporary flag carriers. There is also ad involvement in what I will call the social implications of transport at both a national and international level. I believe that this involvement will take on a special character in the 1970s and beyond. The Minister for Civil Aviation, in bringing forward a measure of this nature, is. not only asking for the authority of the Parliament to take on a loan for the purchase of aircraft for the transportation of people but also informing the Parliament that transportation is part of the total structure and involvement of the nation. I say this because transportation is not only an economic measure but also a ‘ social measure.

Senator Branson:

– Is anybody opposing this Bill?

Senator DAVIDSON:

– It is true that nobody is opposing this Bill, but this debate gives me an opportunity to indicate that the measure itself involves not only economics, national development, freight or even people but also the social implications of international transportation. These factors are influenced by trends in the national economy, population growths and movements, and the various occupations and their connection with opposite numbers in other places. An important influence on international transportation and the ranges of recreations of people to which nobody has referred is the fact that, due to the high standard of living, people in this country are enjoying a wider and more diverse extension of their leisure time and opportunities. The measure which is before the Senate tonight is not related to the items which honourable senators opposite have brought forward; it is related to the ongoing work of international air travel. It should be remembered that international air travel also affects air travel within the nation.

One aspect which was raised by honourable senators opposite is immigration. A total of 68,000 immigrants were carried by Qantas or its agents or connections last year. Over 60 per cent of the people who arrived in this country arrived by air. It has been said - honourable senators opposite have raised this matter on a number of occasions - that there have been changes in our immigration policy and that further changes will occur. There has been a change in the nature of persons migrating to Australia. The migrants who are now coming to Australia are better educated and more sophisticated. I have no doubt that this standard will continue to improve. What is more, the migrant will be an intercontinental traveller and, along with his Australian counterpart, will have a greater capacity and opportunity to travel as well as a greater desire to travel. Therefore, if any value is placed on having one’s own international flag carrier and if it is recognised that having one’s own international airline influences our economy and our growth, this Bill has a very real place in the scheme of things and is of particular relevance. The subject matter of the Bill is not only the impact of aviation on the total transportation system, which is important, but also its relations to Australia’s place in the world wide situation of the social connections of transportation and the social reasons why people move.

It is well recognised that the international aviation business has taken a bit of a down turn in recent times and is going through a particularly bad time. It may be that in the last decade we moved too far too soon. However, in establishing an international airline we have responded to the world demand. The activities of Qantas cannot be taken in isolation. Its involvement has been a contribution by the Australian nation and its growth, development, progress and plans for the future must also have their local application as far as interstate and intrastate transportation are concerned. We are moving into the supersonic age. This Bill is not just a vehicle for wanting to know why certain things are happening in Qantas at the present time but also to undergird the splendid work which this airline has done on behalf of Australia. Support for the measure will enable it to go even further.

Senator BISHOP:
South Australia

– I commence my contribution to this debate by saying that Senator Davidson’s straight out commendation of Qantas Airways Ltd was, I suppose, due to the fact that he has travelled in its aircraft and found its services to be very good. The Opposition was rather surprised to find out not so long ago that Qantas is in financial difficulties, particularly in view of the fact that as recently as January of this year as well as late last year the managers and directors of Qantas led us to believe that Qantas was doing very well in the general business of flying passengers internationally. The Opposition has been all the more surprised to find that issues between the pilots and Qantas have led to the dismissal of aircrew, including flight engineers, all of whom have undergone special training. There are also apparently issues concerning not only wage rates, which would appear to be close to being resolved, but also superannuation.

What we have in the Qantas argument is this: We are purchasing the Boeing 747 aircraft to put on the international run. At the time when we arranged to purchase them there were important differences between the pilots and the management, about which the Minister knew, which had not been resolved, and certain training programmes which ought to have been started had not been started, as a result of which a number of air crew were given retrenchment notices. I refer, of course, to the 153 pilots and the 17 flight engineers who had already commenced a course in preparation for the reception of the 747s. As far as I know, the issues between those people and Qantas have not yet been resolved. Yet people in the Senate and the managers of Qantas are saying that the picture is fairly rosy.

What we on the Opposition side want to know is whether these important and grievous issues which concern the people who operate Qantas have yet been resolved. I refer to the campaigns by Qantas last year when it directed its personnel who were visiting overseas ports to attract additional staff where they could because Qantas needed increased staff. I refer to the representations which were made to the ground mechanics last year to commence a third shift in preparation for the reception of the jumbo jets. Then we found, after some disputes between the ground engineers and Qantas managers, that the ground engineers agreed to work the third shift; but these people are now being put off. I refer to the discussions between the flight engineers and Qantas managers in respect of a special training programme which was to equip flight engineers who were not appropriately qualified and who had come to Australia specially to take up jobs as flight engineers with Qantas so they could fit into the Australian scene. When they commenced their course they were told instantly that they would not be wanted. Some of these flight engineers are now resting at home under an arrangement whereby they will receive 6 months pay until they are told what the future forecast might be.

These questions have been put to the Minister for Civil Aviation (Senator Cotton) and he had been unable to give a direct answer in respect of these issues. I believe, to do him some credit, that he thinks that in matters concerning disputes it may be better for the Government or him to stand aside until the disputes are settled. But I suggest that these differences have not yet been settled. Apart from the pilots’ wages, other great and important matters which concern the industry have to be resolved before we can get the best use out of the expenditure which this country is guaranteeing to put jumbo jets on the runs. I would still be interested to have answers to the questions I have raised with the Minister. I must admit that, in a very courteous way, he gives what information he can. But I suggest that in this matter he should not stand aside and let the parties settle these things. I think the Government’s position is, and properly, as he put it to Estimates Committee D on 21st April 1971. In reply to a question from me he said this:

The board and the management have a responsibility to manage that business -

He is talking about Qantas -

  1. . within a directive laid down many years ago by the Government. It has to make important commercial decisions subject to Government check.

I am yet to be satisfied about the important disputes concerning the pilots and the disputes which concern the flight engineers. These people make up a team of highly skilled men who have to be trained. I have not yet received an answer as to whether their training has -reached the stage where they would be equipped to handle the operation of the 747s. It was first proposed by the Manager of Qantas that the training scheme for Qantas pilots should have commenced as far back as April. It is now the second week of May and the pilots’ wage issue has just been settled. We do not know the outcome of the superannuation issue and we would be pleased to hear from the Minister what the position is.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– Qantas has put other fellows on full shift.

Senator BISHOP:

– That is right. As Senator Douglas McClelland says, Qantas has made other alterations, including the ones I have mentioned, such as when the management went to the ground mechanics and said: ‘We want a third shift’. The evidence so far, as I have found out, is that when the Boeing 747s come on, even presuming they will be on time, there may be a speeding up in training programmes. But it would appear from the information given to me that the availability of aircraft will be less than it is now with the Boeing 707s. I would be interested to hear from the Minister whether that is the position. I have been told that the 747s will be available for only 10 hours a day whereas the 707s are available from 12 to 14 hours a day. That is an important matter if Qantas is to achieve the sort of earnings about which it is talking.

But let us turn to what seems to me to be a most important part of this issue, and that is the issue of the charter services. As everybody knows, the question of Qantas considering the setting up of a subsidiary charter organisation such as the British Overseas Airways Corporation set up has not only been raised in this Parliament in the Senate but has been raised locally. It was a feature of a national television programme recently. It is an issue upon which Qantas has commented and upon which the Minister himself has made an observation. What are the issues? The issues are, of course, that in attempting to explain what the position is the Minister has taken the point that he has to agree to protect first Qantas and whatever international arrangements it has at the present time for conventional loadings and to operate charter services as prescribed by the International Air Transport Association. What we are putting to the Minister and what the pilots themselves have put to the Minister as recently as today is that Qantas should try to get a charter licence and operate its own charter services and not make the sort of assignment which was made when the Government arranged, for example, with Caledonian Airways to carry a large part of the migrant intake to Australia. As people now know, Qantas got no real benefit from this sort of operation.

We have suggested over the years - I understand the pilots have too - that if Qantas operated its own charter services through a subsidiary such as BOAC has, whatever earnings there were in the business would go directly to Qantas. But in Australia we have allowed Qantas to enter a number of leasing contracts which have resulted in a large section of our migrant population coming to Australia by aircraft which are not owned by Qantas but which have been dry leased. I would like to quote some figures which were obtained by Senator Mulvihill recently from the Minister in answer to a question. He asked how many assisted migrants travel to Australia by charter flights or commercial flights, and the Minister’s reply was as follows:

Department of Immigration Bookings.

The detailed breakdown of charter passengers for the financial year 1970-71 (including forward bookings) is as follows:

The information I have - I think the Minister now accepts the information - is that Caledonian Airways, having done an operation which Qantas itself could well have done and having brought the migrants out to Australia, became a direct competitor with Qantas on its return trip. It has been said - I understand it has been put to the Minister directly - by people in the industry that in Singapore, for example, this organisation could offer cheaper fares to people who were already booked on Qantas to London.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– On the off schedule flights.

Senator BISHOP:

– That is so, and in many cases it would be in direct competition with Qantas. It seems rather strange that this should be allowed to happen to an important national enterprise like Qantas. We regard Qantas as an important enterprise. The Australian Labor Party supports national enterprises, but we want answers to this question. At this stage is there not a complete, positive answer as to whether Qantas proposes to engage in specialised charter and subsidiary services? That is very important to know. Another matter I want to talk about relates to World Airways Inc. Last week I asked a question of the Minister for Civil Aviation in respect of a proposition which had been put to him. I referred to the answers given by the Minister recently relating to charter flights generally and the application made to the Minister by World Airways Inc. in connection with charter flights between the United States of America and Australia. I asked the Minister:

Is it a fact that the application of World Airways Inc. is based on the proposal for15 charter flights into Australia which would not detrimentally affect existing services of Qantas Airways Ltd to the United States of America?

This is the important part of that question:

Would the acceptance of the proposal entitle Qantas to a reciprocal 15 charter services . . .

That was the information which had been given to the Opposition. The Minister replied that he understood it was not so but he would find out about it. From the point of view of the people in the industry I suggest that it is alarming, with the sort of reputation which has been built up by Qantas, which we have been accustomed to acknowledge and which is the result of statements from the management of Qantas, that at this stage there should be some down turn. We want to see this down turn corrected. We want to know why it is that the sort of remedies which are possible have not been applied.

Let me refer to a statement made at the end of January 1971. It is a Qantas circular entitled ‘Qantas Plans to Meet Future Challenges’. That circular refers to expanded programmes of training of an increasing number of employees at all levels of staff and management, amongst other things. It refers to separated line operating functions and corporate planning and control functions to allow top management to concentrate on corporate strategy. It also refers to increased efforts to improve relations with customers, employees, the aviation and travel industries, the travelling public and governments. As I have already mentioned, shortly after that time there was for some reason a crisis and people in the industry were told they would not be required. If there is evidence of a down turn, if it was more than an industrial tactic to get pilots to compromise in relation to operating Boeing 747 aircraft, then it seems to me to be good sense from the management point of view to retain those skilled people whom Qantas had attracted from overseas posts. I know from my own knowledge that some of the people who entered the flight engineers courses were attracted from overseas to come to Australia and take the courses but having embarked on the courses they found that there was no security or permanency. They are the issues which concern the management of Qantas.

I have only one last aspect to refer to in this debate. It seems to me that in the light of what I know there is a great lack of industrial technique as far as Qantas is concerned. I am surprised in this day and age that the management of Qantas cannot resolve in the way that it should be able to resolve the differences which are now occurring. I am told that on many occasions when discussions are held they are very arbitrary discussions and that there is no expansion on them or no across the table determinations which might occur in other industries and which would be of great benefit to this industry. I hope that the matters I have spoken about can be resolved because none of us want to see a great national socialistic airline such as Qantas lose any of the advantages which it has built up through efficiency and good service. It seems to me that unless Qantas embarks on the sort of charter operations which the unions are putting to the company it will not succeed.

Senator WOOD:
Queensland

– I have been attracted to this debate because of some of the arguments I heard put forward in regard to the purchase by Qantas of Boeing 747 aeroplanes. Those of us who have been associated with this industry for many years will realise the terrific changes which have taken place over the years at a very quick speed. The types of aircraft have changed, the size of them has increased and so on. One of the great requirements to meet the changing situation is continuing expenditure to purchase newer and larger aircraft. We have reached the position where Qantas is to purchase Boeing 747 aircraft which will carry 350 or 400 passengers, depending on the way in which they are set up. Tonight we are debating whether to approve this expenditure for these very expensive aircraft. I think this Bill should bring in to our minds some realisation of what is involved as far as this country is concerned with our international airline, Qantas Airways Ltd. I think that we have to recognise that there is a limit to what this country might achieve in this regard.

I saw some honourable senators who spoke earlier in this debate putting out their chests with a degree of loyalty to this Australian airline. That is a very nice feeling and a nice spirit to have but we have to have some responsibility of thinking in relation to this question. How far should we go in this matter? Should Qantas tap every country in the world? Should Qantas compete with every service which wants to come to Australia? Would it be better for us to allow some other people to do the work than for us to spend the money and do the work? Some people might say it is wrong to propose those questions. But in the years when the trade of this country, particularly in passenger lines, was carried on by shipping services how many of them were run by this country? They were run mostly by private people who were prepared to invest into that form of transportation. As a consequence, this country did not have to put up any money in order to build up shipping transportation to and from Australia. But because we became involved in airline transport we are now up for considerable expenditure. If I remember rightly our involvement in Qantas is well over $200m at present and it could be much more because of the change in the type of aircraft and the increased size and cost of them. Therefore I think that we have to have some responsibility and we have to give some thought to how far an international airline of this country can go.

I know that a lot of Australians are inclined to think that ours is a big nation, hut it is a very small nation. Sometimes in the United Nations councils we think we count a lot internationally but we are really very small fry. From the point of view of financing projects, Australia is still very small fry but geographically it is a very big country. This country requires a lot of money for developing projects and so on in order to bring it into an even greater state of development. We hear cries of ‘invest in this country’ with reference to the mining industry and other industries but very often we find that the finance is not available to meet the opportunities presented to the people. Australia has become involved in things such as international airlines into which a lot of money is channelled whereas it might be channelled into other directions to help the internal development of this country while other people might be financing our air services on an international basis. I am not suggesting that we should close on this sort of thing. I think there is a limit to what we can do in this matter because we will become involved in larger amounts of expenditure in this connection.

Senator Davidson mentioned the very interesting aspect in a report by Qantas which stated that so many other airlines wanted to come to this country. What is the position? If an airline wants to come to this country from another country it generally gets a licence if Qantas wants a matching service running from Australia to the country involved. I have never been able to see the necessity or the reason for holding up other people in other countries who want to come to Australia until Qantas wants to provide a comparable service. To my way of thinking this is a restriction on people coming to Australia. If an airline in another country wants to come here it will advertise in its own country for people who want to come to Australia. They therefore build up traffic from their own countries and as a consequence we have more people coming to this country as tourists and as businessmen. So I think our own airline sometimes has caused a strangulation of the development of international air trade between other countries and our own. Something has to be done on this subject.

I do not think we are in the position to require a matching service with airlines from other countries which wish to come here. We have to decide just how far we want to get involved in this. Are there any private operators who are prepared to run these services from Australia? If there are, it could save this country a lot of expenditure. We have to review this position because this expenditure will grow and grow, taking money from this country and from this Government which might well be used in many other ways. Let no honourable senator tell me that he cannot think of other areas in which we could invest this money very profitably. Do not let us get carried away and think that it is the beginning and the end to everything. Must we have our Australian airline operating to every country? Let us be sensible and pick the most profitable routes and concentrate on them. If other operators want to come here we should let them come, because from our point of view the more people other airlines bring to this country the better it will be for us. Also, in thinking of the expenditure involved in the carrying on of our national airline or international airline, whichever you like to call it, there has to be some responsibility on the part of the people who are employed in that service.

There is, unfortunately, a slight recession in the aviation business throughout the world at present. Of course, Qantas is suffering too, possibly not just because of this recession but as a result of irresponsibility in certain sections of its service. Just think of it in a sensible manner. If a person feels that an aircraft of a certain airline is not likely to depart on time and there is likely to be a difficulty in getting away because of continual strikes by pilots, ground staff and so on, is he likely to travel with that airline? He will travel with an airline which is more reliable and has been so in the past. Many people will not travel with Qantas because they say: ‘You do not know whether you will get away because the pilots or somebody else will be on strike’. They are the people who are doing a great deal of harm to Qantas. I am not criticising the management; I am criticising those people employed by Qantas who are helping to destroy whatever name Qantas has built up over the years. Do not let us kid ourselves that Qantas is the one airline that stands out from all the others. Qantas gives very good service but so do all the other international airlines. Competition is so keen that they must give a good service.

I have travelled on more than one overseas airline and I find the service on the other airlines is excellent also. So do not let us feel that Qantas is so far ahead of the others that people will automatically travel on it. We have to give service on our airline but we have to build up an impression of reliability in the minds of people in that if an aircraft is set down to depart at a certain time they can reasonably expect it to depart at that time. As I said, this is a big country and lots of people arrive at Sydney airport to travel on an international airline having travelled perhaps 2,000 miles to get there. If they are held up for some trivial reason, such as the pilots or the ground staff wanting to have a meeting or stage a holdup, this is the kind of thing that destroys that impression.

It is a recognised fact that some international airlines today are doing very good business while some of the trade of Qantas has fallen off. This should be brought home. Because of this falling off in business some pilots have been paid off. The people who have my greatest sympathy are the cadets who have been laid off. So far as the pilots are concerned, they have brought it on themselves to a very great extent. They have kept a stranglehold on the company, never realising that there could be a recession and a downturn in the aviation industry. This is possibly the first time that they have been made to realise that they can be out on the street like lots of other people. I feel there is no more responsibility on the Government to dictate to Qantas and force it to keep these people in work than there would be if an ordinary industrial worker came to the Government and said that because the industry had put him off the Government should force the industry to re-employ him. So far as I am concerned, those people would get more sympathy than the Qantas pilots after what they have done in recent times.

The legislation before us allocates a considerable sum of money to Qantas but I do think that Qantas personnel and other people associated with it should get the idea out of their minds that it is easy to get money from the Government. I think they should be made to realise that this Government expects a responsibility right through the service, not just to this Government but to the passengers who pay their way. I also feel that Qantas should not have the right to dictate, through the officers of the Department, that other operators should not be allowed into this country if they do not want a matching service. If we want this international service, let us have it operate in the best possible way. As I said before, we should keep to profitable routes and if other people want routes that Qantas does not think are so profitable they should be allowed to come in. I think in that way we would arrive at a better solution so far as international traffic in and out of Australia is concerned than we have at the present time. If this airline does not build into itself and its staff a sense of responsibility we may find that things will get a lot worse.

If honourable senators read the news in the world of aviation they will find that some of the big airlines, such as PanAmerican and others are running at a loss, not of just a few million dollars a year but a considerably larger amount. Therefore, if those airlines which are run in a most efficient manner find a recession overtaking them to that extent this Government, if it goes too strongly into this aspect of international aviation without some deep thinking on the matter, might find, in a recession such as this, that instead of earning a profit we might well be down the drain. Therefore we want to tailor our international airline to the circumstances of the moment and the tasks which this country could easily accomplish without straining itself and without diverting much of the money which might well be centred on the development of industry in this country.

Senator BYRNE:
Queensland

– 1 assure you, Mr Acting Deputy President, and honourable senators that the Australian Democratic Labor Party is flying a short haulage aircraft in this debate. I do not intend to keep honourable senators very long. I merely rise to indicate the support of the Democratic Labor Party for this Bill and to make one or two observations. The aviation industry, and more particularly the international aviation industry, is in a strange position. Almost all internation airlines, with some exceptions and apart from the countries behind the Iron Curtain, are flying substantially the same limited types of aircraft - Boeings, perhaps Douglases and some other British planes - the great bulk of which are manufactured in the United States of America. That means that the airline companies are really discharging a strange sort of commercial enterprise. The only way in which they oan continue to function in intense commercial competition, in view of the fact that they are not masters of the manufacture of their own instruments of operation, is by very intense regard for efficiency within the industry. To that extent I agree with Senator Wood that the industry must have a particular concern for efficiency because there are these limitations within which Qantas and most of the other international airlines must operate.

That being so, the aircraft operating industry is particularly sensitive to anything that might impair that efficiency. I do not agree with Senator Wood when he speaks of the disappointment in Qantas Airways Ltd being experienced by people due to stoppages as a result of industrial unrest. There have been stoppages in more recent times. They have been severe and they have been regrettable, but they were not confined to Qantas. There were major stoppages overseas very recently with the British Overseas Airways Corporation. I think it would be a slightly unfair reflection on the reputation of Qantas to say that the impression was gained that there has been an atmosphere of frustration and disappointment built up among would be Qantas patrons because of these industrial stoppages. More recently there has been this atmosphere but the general impression of Qantas is that it is most reliable in its mechanical operating efficiency, its high standard of airworthiness and, in addition, it is an extremely competently run airline administratively. While these more recent industrial stoppages may have done something to mar that image they have not done it to a large extent.

The Australian people still have the highest regard, properly and correctly based, for the national airline. But let us remember this: As far as I have been able to see, priority in patronage is given by people of a nation to its national airline because it is its own national airline and not necessarily because it is more efficient than some other airline. But how long can that condition remain? If an airline loses its efficiency I am afraid the tug of national patriotism would not be sufficiently strong to attract continued patronage. Therefore overall and at all times there is this tremendous demand for maintaining the highest standard of operational efficiency. Regularly moneys have to be obtained on loan to finance the purchase of the latest available aircraft because, unfortunately, no company can continue to operate efficiently with aeroplanes which are slightly outmoded, even from the point of view of economic operation, or which do not provide that level of passenger service which the patronising public have now come to expect and even demand. With the emergence of planes like the Boeing 747 with its tremendous initial capital cost we can expect over the years that there will be increasing demands for heavier and heavier capital investment. That is something we must recognise. If this capital is to be serviced, if the company is to continue to operate with economic efficiency, to balance its budget, and to provide some element of profits and reserves, this standard of efficiency must be maintained. In Australia we have a magnificent record of aeronautical efficiency in administration and in technical operation. I trust that nothing will ever mar that situation. Qantas has made one of the major contributions in this field and has achieved international recognition.

There may be some warrant, as there is in other democratic countries where the Westminster parliamentary system operates, for having some parliamentary structure which can bring under scrutiny public corporations such as Qantas. We are intensely proud of Qantas. If we were to scrutinise its activities it would not be in any hypercritical sense to disclose its shortcomings but merely to examine its structure and see whether improvements could be effected. That may well be a matter which might come within the cognisance of the transformed Senate through one of its committees or through the creation of some special standing committee which might have as a matter of immediate purview the exploration of the public corporation, whether it is Trans-Australia Airlines; the Australian National Line; Qantas Airways Ltd, the national airline, or one of the other public corporations which are now starting to proliferate in this country. A public corporation is not really subject to parliamentary scrutiny at all because that is one of its traditions. In a substantial way the public corporation may well, in a spirit of generous co-operation and assistance, come within the purview of the Senate and therefore of the Parliament through the committee system. I commend this suggestion to honourable senators who at a suitable time might feel that there is something in the suggestion which might warrant the detailed and mature consideration of the Senate. The combined views and suggestions of honourable senators might be pooled to assist in the further development and to raise the status and maintain the efficiency of this great national airline, Qantas. The Australian Democratic Labor Party supports the Bill.

Senator COTTON:
Minister for Civil Aviation · New South Wales · LP

– I am glad to learn that the Australian Labor Party and the Democratic Labor Party support the Loans (Qantas Airways Ltd) Bill.

Senator Murphy:

– But not without a lot of doubts.

Senator COTTON:

– I hope Senator Murphy realises that we have here a contractual obligation entered into some time ago to purchase aircraft. That is what this Bill does. I have been most interested to listen to the debate. I shall be reading the Senate Hansard with great care. But I think there have been quite a number of misconceptions in the debate. The Bill does not ask the Commonwealth to put money into Qantas Airways Ltd. It brings about a condition where money is borrowed on behalf of Qantas which will repay the loan as it has in the past. It is difficult to deal with the range of subject matters which have been raised in this debate. I would very much like to be able to do so. I have been trying to work out how to do so in the time I have available and not speak for a couple of hours. Somebody has mentioned that Qantas is in financial difficulties. This is not so. I have said this on a number of occasions. It is not so at all. I think a couple of quick comments will demonstrate the situation to honourable senators.

Qantas will report a profit for the year ending 31st March 1971. It would not be proper for me to state the order of the profit because the figures are not yet audited; but it could be in the area of S4m or $5m. When people talk about financial difficulties the best thing to do is to go back to the last audited balance sheet of the concern which has been tabled in this Parliament and published. If honourable senators look at the balance sheet they will find that the assets of Qantas total S247m. The fixed assets were $l39m. the land $33m and the plant $5m. The company has $21 m in investments, $19m in debtors, $5m in advances and $25m in cash. Those figures are taken from the last published, audited balance sheet. Since that time until 31st March the company has made a profit. I think all honourable senators will agree that that will not argue a condition of financial difficulty. On many occasions I have said - I think I should say it again because it has been referred to by one of my colleagues - that we are indeed a small country to run a very big airline. We have to be extraordinarily careful and we have to be very watchful. To me this debate has been very valuable because it has highlighted for general consumption a number of matters which are of concern in this whole operation as we look towards the future. But what we are fundamentally involved in here is a commercial operation by a government owned airline which is operating in the commercial market place. A number of matters have to be watched. The airline needs to be profitable in order to match its capacity to the market. We need if we can, wherever we can, to look after its markets at the same time recognising that it properly has to operate in the market place, it properly has to generate traffic for Australia and it properly cannot be insulated from the forces of the market place. I think none of this is inconsistent with what honourable senators have been saying.

Financial arrangements such as this are typical of the way in which Qantas has, through the years, financed its expansion and its re-equipment programme. It has maintained a very high ratio of repayable loans to equity capital. The balance sheet will demonstrate this situation to any honourable senators who are interested. This has been a most successful way of financing the company’s operations. If honourable senators look at the run of years of Qantas operations there are 3 particular years which are interesting. They cover a period of 20 years and they are the balance sheets for 31st March 1970, 31st March 1961 and 31st December 1950. Looking at the balance sheet for the year 1950 honourable senators will see that the total assets of Qantas, the wholly owned Australian flag carrier, were $18m. In 1961 they had become $123m.

Senator Wilkinson:

– Is that pounds or dollars?

Senator COTTON:

– We converted the figures into dollars. In 1970 the total assets had reached $247m. In 1950 the shareholders’ funds were $8m, in 1961 S3 6m and in 1970 $41 m. That can be summarised by saying that in the last 9 years Qantas has expanded its assets by $I24m, with a net increase in its shareholders’ funds of only $5m. The balance of its business has been financed by loans repaid, depreciation retained and expansion. To achieve that kind of condition one must have a profitable business, and this busi ness has been profitable except for the one year when there was a pilots’ strike. That pilots’ strike lasted about 28 days and cost $13m.

Senator Byrne:

– When you say that it cost $13m, does that mean in loss of revenue, or net loss?

Senator COTTON:

– Loss of revenue. But it had a consequential effect and it produced a loss phase to Qantas. The situation really was this: In the preceding year the company had made $4m before tax, in the year of the strike it lost $Hm, and in the next year its profit was back to about $2,800,000. So the total effect of the loss would probably have been a loss of about $2im in net profit and $13m in revenue. This demonstates to us all that we have a concern to try to keep this business as a profitable business. The business will not be profitable if it stops flying. The Qantas enterprise, which is owned by the Australian people, has had from the Australian people in cash $39m, or 16 per cent of its total assets. It is a fairly successful operation which has been built up in this country.

Let me refer to its industrial record. People say that the company is always having strike troubles. It has had a lot of troubles, but the best figures we can get indicate that its record is neither better nor worse than most other airlines around the world. Qantas, rather than being a drain on revenue, is a substantial contributor to Consolidated Revenue. With dividends and income tax paid, it is a net earner of revenue in Australia. Another factor that means a lot for a country like ours is that of foreign exchange. The possession of our own flag carrier helps us substantially with foreign exchange. Last year the foreign exchange earnings were $108m.

I have been pretty careful throughout the whole argument that has taken place on the problem of Qantas not to have too much to say, not to be provocative and not to say things which might add to troubles, because my principal concern has been to have these arguments settled equitably and to have the management and the employees meet to fix their problems so that the airline can go on being successful and profitable.

Senator Murphy:

– What is equitable about those salaries that have been paid?

Senator COTTON:

– As we go along, let us look at some of the comparisons and some of the responsibilities. Qantas has had a most successful economic life, but airline operations are very delicate and very difficult. A fall of 1 per cent in the load factor drops the revenue by $4m a year. The experience of overseas carriers has been cited, such as the losses made by Pan Am, Trans-World Airlines and American Airlines. The retrenchment of staff in Pan Am’s case amounted to 5,000. United Airlines and TWA in America reported losses amounting to $73m.

The problems of Qantas came about very quickly for two particular sets of reasons. There was a dramatic change in the growth pattern of its traffic. For the 6 months ended in September 1970 its traffic was growing by 20.1 per cent over that for 1969. For the 6 months ended in March this year that growth had gone down to 13 per cent. In the 3 months ended in March 1971 the growth had declined to 7.6 per cent. That downward trend has continued, particularly in the Pacific. But the business as a business throughout its long pattern of years has disclosed a long term growth trend. We are hopeful that after a while - one does not know how long; it might be a few years - this will begin to pick up again. This particular problem developed in the market - that the growth was suddenly dropping well below calculations. In addition, at the same time there were dramatic increases in costs. Let me refer to some of the increases. On 14th December 1970 the Conciliation and Arbitration Commission gave a wage and salary increase of 6 per cent. On 17th December Commissioner Portus gave a decision increasing the salaries of clerical and administrative staff by 18 per cent. On 7th January the Qantas ground staff went on strike, and most of the staff who were normally occupied on budget reviewing were out helping to keep the airline running.

At the end of January, with the growth figures showing a decline and with the emergence of these cost problems, the whole situation was put under review. On 19th January the British postal strike began. These are some of the factors that had an effect on the position of Qantas. Looking at the business of the company, we know that at the end of December last year it was operating on figures which were above budget. In January, particularly in February, and more so in March the real troubles began to show up. That is the reason why action was taken early in April. People say that this must have been known, but it was not known. It happened very quickly and very early this year.

I have said a lot before about charter flights. I have a lot of material here but I do not think that it really adds anything to the debate. The problem that Qantas has is to encourage and maximise its business. This is what it seeks to do. The company operates within the outer framework. It offers substantial concessions for charter flying. I have quoted these figures in the Senate in the past, pointing out that the number of passengers on charter flights for 1970-71 was 93,000. A large part of the company’s revenue comes from charters. The company obeys the charter rule and is doing what it can to accommodate itself within the framework of the company and the rules under which it operates to get the maximum business it can for the charter section of its affairs.

The industrial situation has been referred to. I have been doing what I can to see that the matter is resolved. Agreement has been reached between the Qantas management and its technical air crew the pilots. That means that Qantas captains will receive a guaranteed minimum salary of $24,511 for flying a Boeing 747. As I said this morning, that can be increased if the captain flies longer hours. Everyone would concede that that is a lot of money. But it is worthy of note that a Boeing 707 has a capital cost of $8m as against the capital cost of S23m of a Boeing 747. The annual earning capacity of the Boeing 707 is between $7m and $8m a year, while the Boeing 747 has an earning capacity of $ 18m to $20m a year.

Senator Kennelly:

– What load capacity?

Senator COTTON:

– That assumes a utilisation of 3,000 to 3,500 hours. We have a situation in which a man - highly paid, admittedly - is in charge of an asset worth about $23m which we would expect to earn, on the load utilisation hours given here, between Si 8m and $20m a year. He has a great responsibility. He carries a great number of people. The salary which has now been agreed to bears a very reasonable comparison to similar salaries for similar aircraft in other countries. The superannuation scheme is being reviewed by a group of 3 actuaries- one for the employers, one for the employees and one to act in an independent sense. So any of the problems that have arisen in the past will now be rectified. On the question of redundancy, we have been doing everything we could to use our best offices to find alternative methods of employment for all the technical air crew. We believe that we are succeeding. These matters are substantially matters for Qantas and its employees. Naturally, all of us have a great interest in this matter because Qantas is an airline Owned by the Australian people. It is a most successful airline. It has done a very good job for this country - an extremely good job indeed. As will all companies like it, Qantas will have its problems. It will have its periods of difficulty, but it has had those in the past SO years and look at what it has done. So I suggest to the Senate that this Bill, which seeks to raise the balance of the capital to pay for the aircraft contracted for, very properly deserves the support of the Senate.

Senator Sir KENNETH ANDERSON:
Minister for Supply · New South Wales · LP

(9.31) - This Bill, of course, is a Treasury Bill. The Minister for Civil Aviation (Senator Cotton) has responded to matters which are strictly speaking not within the compass of the provisions of the Bill but as is common in the Senate the second reading debate has been very wide and the Minister felt obliged to respond to some of the points that were raised. The Bill provides for the borrowing of S26.4m on the one hand and $26. 8m on the other. The $26. 8m is to be borrowed from a syndicate of United States commercial banks, with which the Chase Manhattan Bank of New York is associated, and the $2 6.4m is to be borrowed from the Export-Import Bank of the United States under loan agreements. I acknowledge that the Opposition has indicated its support for the Bill. I had hoped for a reasonably speedy passage for it but in the nature of things the Senate wished to debate it in this way and I cannot complain about that.

Senator Murphy raised one point of significance which should be answered. The point is directly germane to the Bill and is distinct from the other matters to which the Minister for Civil Aviation has responded. Senator Murphy referred to section 8 (d) of the First Schedule which places a restriction on the use of aircraft. Of course, this section is applicable only to the loan to be obtained from the ExportImport Bank and not to the commercial loan. That is the first point I want to make. The second point is that this restriction is applicable only during the period of repayment of the loan. Once the loan has been paid off the restriction disappears. The section specifies that none of the aircraft -

  1. is principally for use in a Communist country (as defined in Section 620(f) of the Foreign Assistance Act of 1961, as amended) or (ii) is to be used principally in any nation (a) which engages in armed conflict. . . .

The word ‘principally’ appears in both instances. Quite obviously the aircraft will not be used principally for either of those purposes. They will not be used principally in the war area during the period of repayment.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– Or in a

Communist country.

Senator Sir KENNETH ANDERSONAs defined in section 620(f) of the Foreign Assistance Act. The point is that this restriction is a term of condition of the loan and the relevant section uses the word ‘principally’. The aircraft must not be used principally in the areas referred to. As Qantas is an international airline it will fly all over the word and not principally in a Communist country or in a war zone. A person lending money on an asset would not want that asset, whether it be a vehicle or an aircraft, involved in a war zone during the period of the loan. That is the explanation of the provision as given to me.

Senator Wilkinson:

– It is a condition of the purchase, not of the loan.

Senator Sir KENNETH ANDERSONAs I understand it, it is a condition of the loan. Ii has nothing to do with the purchase at all and has nothing to do with the Boeing company, as suggested by Senator Kennelly. Rather it is a condition on which the money is lent by the Export-Import Bank.

Senator Murphy:

– They are treating Australia as a fifth rate debtor.

Senator Sir KENNETH ANDERSON:

– One of the odd circumstances is that those providing the other part of the loan, the commercial banking institutions, have not sought this restriction at all. It is a rather odd situation. I thank the Senate for the passage of the Bill. The next time I deal with a Treasury Bill relating to Qantas I will put it in the hands of the Minister for Civil Aviation.

Question resolved in the affirmative.

Bill read a second time.

In Committee

The Bill.

Senator MURPHY:
New South WalesLeader of the Opposition

– The Schedules to the Bill have a number of sections to which objection has been raised during the debate. I ask the Minister for Supply (Senator Sir Kenneth Anderson) whether any attention was paid to the criticisms which were made on the last occasion such a Bill went through this chamber? I remember drawing attention to the provisions which were contained in another loan Bill which concerned aircraft. It seemed to me to be inconsistent with the standing of Australia that Australia should enter into arrangements with other countries in which it agreed to conditions which would impair its sovereignty and would allow it to be treated as a fifth rate debtor of dubious solvency seeking a loan. The United States would be well advised to pay some attention to this because even if the Government is not resenting the fact that these provisions are contained in Bills, the Opposition is, not only in this chamber but also in the House of Representatives.

If the United States wants to produce a relationship which will be conducive to proper and continued fair dealing between the countries it should pay some attention to seeing to it that these provisions which are resented and which the Opposition regards as an indignity, are taken out of these Bills and agreements. 1 do not like to see Australia being treated in this way. Those who go overseas apparently treat these provisions as a matter of form. I do not care whether the United States has some Act of Congress which says it has to be done in this way. If it has, let it change the Act. If the United States wants to do business with us, and it does because it wants to sell its aircraft and we want to buy the aircraft, it should give consideration to taking these provisions out of the arrangements. There is increasing resentment to them. It might have to amend its legislation in order to do this. I want that message to get over well and truly and clearly. If the United States wants to continue selling goods to us and to continue lending money as a means of facilitating sales - it does let there be no doubt about it - these provisions should come out of the agreements.

There is no reason for this kind of nonsense in the agreements. If Australia enters into an arrangement for a national instrumentality to borrow money it will repay the money. There is no need for any kind of security. Everybody knows that a security is enforced between sovererign countries. There is no need to put all this rubbish in these agreements. If Australia agrees to borrow the money it will repay that money. Any sovereign country will either repay or default and there is no purpose at all in putting into agreements this undignified kind of provision which specifies what Australia will do with the aircraft. There should be a simple arrangement under which we borrow the money and agree to repay it. That should be the basis of dealing between sovereign countries.

Senator Byrne:

– Perhaps their local law does not allow them to sell except on that condition. I do not know.

Senator MURPHY:

– If that is what their local law provides then it is time they were told it should be changed, because that is not the way to deal with a sovereign country. It is up to us here to let them know. I am not speaking for the Government; it can speak for itself. If the Government is prepared to accept this kind of provision, let it do so. I am speaking for the Opposition.

I am saying that I do not think this is a very satisfactory way, from the point of view of the United States, to be dealing with us, and the sooner the United States wakes up to it the better. It does not serve any useful purpose, except that when we read about it we get angry, and that is what has happened in the other chamber and in this chamber. It is time that they took this out and said: ‘Here is the basis of the loan. You are borrowing this amount. You repay it in this way.’ Let that be the end of it. Do not try to put tags on it and impose all sorts of undignified provisions which are probably unenforceable. But irrespective of whether they are enforceable, they ought not to be in the terms of the loan. That is the message I would like to convey. I do not ask the Government to join in if it does not want to do so. I say that in this respect there is a very strong feeling in this Parliament. I do not think it is shared only by the members of my Party. It would be a lot better if that is what the United States did. When our representatives go overseas, whether they be of the present Government Parties or not, if they were determined to cut out some of this nonsense I think it would be a good thing.

Senator Byrne:

– But if the United States had a treaty obligation that it would not supply so and so or sell equipment that would not be used in a certain way, how would we get around that?

Senator MURPHY:

– It would be very difficult to see how the United States could have a treaty obligation, except with us, that would affect us in that way. If the Government says there is some such thing let it tell us, but I find it difficult to conceive that the United States could enter into a treaty with somebody else which would affect its relations with us in this way. I should say that if it has legislation over there, its people are well aware of the implications of finance. If it wants to deal reasonably with us I think that it ought to start paying some attention to the kind of obligation which it is imposing on us. I pointed out some time ago the resentment that this kind of provision causes. I notice that quite spontaneously and unconnected with me, a similar kind of resentment has been expressed in the other chamber. This is not a good thing for the relations between countries. If the loans are to be made let them be made on a much better basis so far as we axe concerned. Let them be made on the basis of the simple financial obligations. Let us not be put in the position of a subordinate or second rate country in dealing with the United States.

Senator KENNELLY:
Victoria

– I was intrigued by the answer given by the Leader of the Government in the Senate (Senator Sir Kenneth Anderson) to the question I raised in relation to subsection (d) of section 8. If I understood and heard him correctly, he stated that this agreement is good only during the time of the loan.

Senator Sir Kenneth Anderson:

– The duration of the loan.

Senator KENNELLY:

– Yes. I ask my good friend to read it again. That subsection reads:

No aircraft or related equipment the purchase of which is financed, in whole or in part by Eximbank under this Agreement . . .

It does not state that it is during the time the money is owing.

Senator Sir Kenneth Anderson:

– Yes, it does.

Senator KENNELLY:

– I do not know that it does.

Senator Little:

– Would it not be clear-

Senator KENNELLY:

– J am talking to the butcher, not the block. The honourable senator has a bad habit of interjecting. If he wants to talk he should get up and talk. All I say, as I understand it-

Senator Gair:

– You have talked more in the last fortnight than you have talked in the last 6 years.

Senator KENNELLY:

– If in the last fortnight I wanted to speak all night it would have nothing to do with the honourable senator. If he wants to enter the debate I do not mind that either.

Senator Poyser:

– He is just cranky.

Senator KENNELLY:

– If he stayed in the chamber a little longer he might not be so cranky. Sub-section (d) of section 8 states:

No aircraft or related equipment the purchase of which is financed . . .

I cannot understand how the Leader of the Government reads into that that this subsection does not have effect after a certain time. He suggests that it affects the position only when the loan is owed. I cannot see how he reads that into it or, with great respect, how his advisers can read that into it If it is taken in the way which is suggested here, at any time any aircraft which is purchased by the method that these aircraft are being purchased must be used in accordance with sub-section (d) of section 8. It amazes me that the Leader of the Government should say that it operates only until we pay off the loan. It does not say that. Therefore, I still want to know from the Minister how he ascertains that the words ‘or related equipment the purchase of which is financed’ suggest a time limit. The sub-section does not impose a time limit on any purchase at all, whether it is during the currency of the loan or until the money is paid back. It says: ‘or related equipment the purchase of which is financed’. It does not say: ‘After the financing is finished and we have paid the money over you can do what you like with the planes.’

Senator Sir KENNETH ANDERSON:
Minister for Supply · New South Wales · LP

(9.47) - The Leader of the Opposition (Senator Murphy) has expressed a point of view, which he is entitled to do. I shall not reflect upon it. In relation to the point made by Senator Kennelly, I am assured by my advisers that that sub-section means exactly what it says, that it is related to the purchase of which is financed’. Once the purchase and the financial aspect are completed, the complete possession of the aircraft goes into the hands of Qantas Airways Ltd, and Qantas then has the complete right to do what it likes with the aircraft. It is only in relation to the purchase and the financing of the purchase that these conditions are applicable. All I can say is that this is the advice I have received from my advisers, and that is where that aspect of the matter rests with me.

I have been reminded by the Leader of the Opposition that on a previous occasion we spoke in terms of writing conditions into the loan agreement between the Government and the Export-Import Bank. The difficulty I see in relation to sub-section (d) of section 8 relates to the Foreign Assistance Act of the United States. That Act provides that foreign assistance and foreign aid can be given only in certain limited areas, and therefore this part of the section has the qualifying limitation. Senator Murphy has expressed the view on behalf of the Opposition that we should be able to borrow without these qualifications being put into the terms of the agreement. All I can say in relation to this loan is that these are the conditions upon which the loan was made. I have no doubt that the point Senator Murphy made, as an expression of view propounded by the Opposition, will be taken into consideration by the Treasury in relation to any future loans.

Senator MURPHY:
Leader of the Opposition · New South Wales

– I thank the Leader of the Government in the Senate (Senator Sir Kenneth Anderson) for his remarks. We of the Opposition think that the Americans are selling us good planes and obviously we have been able to use those planes to good advantage in building up our air services. At the same time, there is a certain national dignity to be maintained and if year after year the United States persists, through its agency, in offending that national dignity by insisting that as a condition of borrowing some money from it - which we will be paying back after all - we have to enter into terms which some of us here consider to be degrading, it is going to affect our future relationship. I hope that not only the Treasury but also the United States authorities will take that into account. Otherwise the pressure will become stronger to look elsewhere. It is not as if we are a mendicant country receiving foreign aid. This is a simple kind of transaction for which we probably do not need to borrow money because we seem to have stacks of international reserves. But the Government seems to like to maintain those reserves and to do business in this way. We are not forced to borrow this money. It is just part of the method used to purchase the aircraft.

If in future we had to look elsewhere, we would look elsewhere. I think the United States authorities ought to understand, and our Treasury ought to make them understand, that resentment is arising in Australia because of these clauses in the agreement which have no real purpose but are degrading to us. If it is necessary to include them because of United States legislation, the United States should consider that legislation. Whether it should be amended would be its affair. I think it is reasonable that in view of our comity with the United States the American Government ought to be put on notice that clauses are being included in agreements which are certainly offensive to a considerable number of members of the Australian Parliament, on no other ground than that they are inconsistent with the dignity of this country and are degrading to our sovereignty.

Bill agreed to.

Bill reported without amendment; report adopted.

Third Reading

Bill (on motion by Senator Sir Kenneth Anderson) read a third time.

page 1695

LOAN BILL 1971

Second Reading

Debate resumed from 4 May (vide page 1329), on motion by Senator Cotton:

That the Bill be now read a second time.

Senator WILLESEE:
Western Australia

– This is a machinery Bill of which warning was given at the time of the Budget. It was pointed out in the Budget papers that it might become necessary to raise moneys to bridge a gap between anticipated expenditure for the year ending 30th June 1971 and what would later appear to be the final requirement. We appreciate that in August of last year when the Budget papers were prepared it was quite impossible to predict exactly income and expenditure 12 months ahead. A Budget is in some ways an estimate of what will happen. After it is brought down pressures are placed on the economy. This Bill does not authorise the spending of moneys in any way that has not been agreed to by this Parliament.

Senator Cotton, who introduced this Bill in the Senate on behalf of the Treasurer (Mr Snedden), gave some details in his second reading speech of why this measure is necessary. He dealt with expenditure, the shortfall in loans and that type of thing. This is an internal machinery measure which allows for moneys to be raised until 30th June next and to be charged not against the Consolidated Revenue Fund but against the Loan Fund. Reference is made to defence purposes. I understand that one reason for that is that the raising of money for defence purposes for a specific object does not require the authority of the Loan Council. I repeat that we are not being asked to authorise expenditure on new works. We are asked to give authority for the raising of moneys, warning of which was given in the Budget papers last August. The Treasury is to be given authority to raise moneys internally up to, and only up to, the end of this financial year in order to bridge the gap between anticipated expenditure in August last and the amount of expenditure that is now expected in this financial year. A machinery Bill of this nature is not unusual. It is introduced each year and the Opposition offers no objection to it.

Senator BYRNE:
Queensland

– The Australian Democratic Labor Party naturally supports this Bill, but I am intrigued as to the real reason for its introduction. Senator Cotton, who introduced this Bill in the Senate on behalf of the Treasurer (Mr Snedden), indicated in his second reading speech that it is difficult to anticipate prospective loan raisings and that a shortfall in loan raisings will cause a deficit in the total national accounts which otherwise would not have occurred. Authority is now being sought to raise moneys to bridge the gap, which may be the result of many factors; for example, a fall in revenue or over expenditure greater than was anticipated, together with a shortfall in loan raisings. Perhaps the Minister for Supply (Senator Sir Kenneth Anderson) would be good enough to indicate precisely the areas in which shortfalls or over expenditure occurred which gave rise to this Bill.

I know of one area. I drew attention to it in discussing the supplementary Estimates. I refer to the extraordinary situation wherein the Budget makes no provision at all for the virtually known additional expenditure required by the Government as a result of the determination of the Conciliation and Arbitration Commission in the national wage case, declarations of the Public Service Arbitrator on matters at that time before him and decisions to be handed down after the framing of the Budget. That gives to the national accounts an unreality which becomes obvious when a Bill such as this has to be presented to bridge the gap. It is most important that when the Estimates of anticipated receipts and expenditure are placed before the Parliament they are as close as humanly possible to the figures that will emerge. There is a total unreality about the procedure, because at the moment that those Estimates are framed it is known that they will be grossly out of perspective in a few months time. Yet 1 am told that there is no way to avoid this situation because it is neither prudent nor proper to anticipate decisions of the Conciliation and Arbitration Commission or the Public Service Arbitrator, particularly at the instance of the great Commonwealth authority which might in that way indicate its anticipation of the decision or in some way have an effect or influence upon the decision that will be handed down.

If this method of presenting accounts is to be continued we will inevitably have before us propositions such as that contained in this Bill. As I said some days ago, I hope that the Public Accounts Committee will take this matter into its considerations in co-operation with the Treasury to see whether consonant with propriety when dealing with judicial or quasi-judicial tribunals some method might be found by which national accounts when presented at Budget time have a much closer approximation to the ultimate figures that emerge. The Democratic Labor Party supports the Bill.

Senator Sir KENNETH ANDERSON:
Minister for Supply · New South Wales · LP

(9.59)-l thank the Senate for the speedy passage of this Bill. Senator Byrne asked for advice on the areas in which increased expenditure has necessitated the introduction of this machinery Bill. Senator Willesee very properly pointed out that this procedure is followed more or less every year. I wish to refer to part of the second reading speech made by Senator Cotton in presenting this Bill on behalf of the Treasurer (Mr Snedden). I think it covers the point in which Senator Byrne is interested. Senator Cotton said:

Some of the more important increases in expenditures which have occurred since the Budget were outlined in a statement which I made to the Senate on 16th February dealing with Government expenditure. It is, however, useful to refer to some of them here. The largest variations affecting the expenditure estimates have been additional payments to the States, including $60m to compensate the States for loss of receipts duty revenues, $43m in additional assistance to the States to help with their budgetary difficulties, and about $25m in increased financial assistance grants arising from the effect on the formula determined grants of the higher than anticipated increase in the average wages. In all, payments to or for the States are now expected to exceed the Budget estimates by the order of $1 32m.

That, in itself, is quite a significant amount. There is reference to other matters in the second reading speech. Senator Byrne also asked whether or not the procedures should be looked at, and he suggested that the instrument which should be used to look at the procedures should be the Public Accounts Committee. I see nothing wrong with that proposal. I think that the contribution which the honourable senator has made in this regard will be picked up somewhere and no doubt this aspect will be examined. However, I feel bound to say, as Senator Willesee said, that these things happen in a nation the size of Australia, because of budgetary considerations and the fact that we are in a federation in which so many variations occur in a financial year. Quite obviously this is one of the machinery procedures which become necessary. So far these machinery procedures have been used, more or less, every financial year.

Senator Byrne:

– I think that the amount for the wage and salary determinations in the supplementary estimates is about S80m.

Senator Sir KENNETH ANDERSON:

I have been given some figures which indicate that even additional grants to the States amount to $133m.

Question resolved in the affirmative.

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

page 1696

PAPUA AND NEW GUINEA LOAN (INTERNATIONAL BANK) BILL 1971

Second Reading

Debate resumed from 4 May (vide page 1 593), on motion by Senator Cotton:

That the Bill be now read a second time.

Senator KEEFFE:
Queensland

- Mr Deputy President, as the title to the Bill indicates, this is a Bill for an Act ‘to approve the guarantee by the Commonwealth of the discharge of the obligations of the Administration of the Territory of Papua New Guinea under a loan agreement made with the International Bank for Reconstruction and Development, and for purposes connected therewith’. The Opposition does not oppose the Bill, although there are many things about it that we want to criticise, and I will take this opportunity to do so. Frankly, if we opposed the Bill we would be criticised for trying to hold up the development of the Territory of Papua New Guinea, but this would not be so. Some weeks ago I drew the attention of the chamber to the fact that on the day on which the Government changed Prime Ministers 2 ravens were sitting on top of Parliament House waiting for the body of a decaying government. When we examine the interest rates to be charged on this loan, I would not be surprised tomorrow to find the traditional 3 balls hanging outside Parliament House.

We are to borrow a total amount of $20.7m from the International Bank. The loan is over a period of 25 years, at an interest rate of 7.25 per cent. I want to state the reasons why we are borrowing the money so that my contribution to the debate fits into its right perspective. It involves the construction of an underground power station on the Ramu River with an initial installed capacity of 45 megawatts; approximately 320 miles of transmission lines; 4 transformer substations at Lae, Madang, Goroka and Mount Hagen, and the enlargement of transformer capacity substations at 2 other centres. In normal circumstances, when borrowings are made by the Administration of the Territory of Papua New Guinea they automatically carry a Commonwealth guarantee by virtue of the operation of section 75a of the Papua and New Guinea Act 1949- 68, but with loans from the International Bank a formal guarantee agreement is required from the Commonwealth and this must be authorised by specific legislation.

In this instance the interest rate is H per cent, whereas the Australian Commonwealth loan interest rates are somewhere between 4 per cent and 6 per cent. This loan is a bit like the loans that Queensland gets for developmental projects, when Queensland is always charged the highest interest rates on its loans.

Senator Sir Kenneth Anderson:

– Did 1 hear you quote an interest rate of 4 per cent?

Senator KEEFFE:

– I am suggesting that the current Commonwealth loan interest rate is between 4 per cent and 6 per cent. I am suggesting that the loan in this case, at 7£ per cent, is similar to the loans which Queensland obtains from the Commonwealth Government from time to time for developmental projects when Queensland is charged the highest interest rates. The high interest rates make the loans difficult to service. The repayments have to be met by the people who enjoy the services provided by whatever project may be developed. In another pi aca, during the discussion on this Bill one of my colleagues made the point that the loan made for postal services in the Territory of Papua New Guinea has been difficult to maintain and repay, so that today the Territory has the highest postage rates of probably anywhere in the Asian area. The charge for a letter is 7c. The charge for a single unit fee telephone - call is 12c. Admittedly these services have improved. Less than 10 years ago it was very easy to make a telephone call in the Territory, but one had plenty of time to walk two or three blocks and be at the other end of the tine to receive the call. Neither postal deliveries nor telegram deliveries is known. But one does not have to go to New Guinea to find a lack of those facilities because nobody in the Torres Strait area ever has a letter delivered.

I worry whether the high cost of power may be a penalty that the people in this developing country will have to pay in the long term, because the Government has obtained this loan from the World Bank at such a high interest rate. The loan is roughly two-thirds of the total amount of the borrowing - $30.3m. I cannot understand why Australia was not able to make available this sum of money to our nearest and, as far as I can see, our friendliest neighbour. The Government is leaving a legacy that will be difficult to pay in the long term. With an economy that could hardly be described as stable, the loan will impose a tremendous burden on the people in the years to come. My worry goes further than that. There are so many restrictions in the schedules to the Bill that I find it difficult to ascertain who has been taken down by whom. I shall quote certain parts of the schedule to the Agreement so that we understand the problems. Section 3 (B) of the Second Schedule states:

The project will be carried out by the Papua and New Guinea Electricity Commission (hereinafter called ELCOM) with the borrower’s assistance and, as part of such assistance, the borrower will make available to ELCOM the proceeds of the loan as hereinafter provided.

In a moment when I speak of ELCOM honourable senators will know to what I am referring. Section S.03 of the Second Schedule, which is agreed to by the Australian Government on behalf of the Territory, states:

The Borrower shall afford all reasonable opportunity for accredited representatives of the Bank to inspect ali plants, installations, sites, works, buildings, property and equipment of ELCOM and any relevant records and documents and to visit any part of the territories of the Borrower for purposes related to the Loan.

So, the project will be continually under the overseeing eye of the World Bank. Although the World Bank has already investigated this proposition and found it to be a fairly safe one, it will continue to maintain this watchdog role in relation to what happens to the money. For the first 5 years there will be no repayments. On 15th October 1976 the first repayment of $265,000 will be due. The last one will be payable on 15th April 1996 and will be $1,070,000. Let us look at the further restrictions in Schedule 4. Paragraph 13 reads:

The term external debt means any debt payable in any medium other than the currency of the Guarantor or the Borrower, whether such debt is or may become payable absolutely or at the option of the creditor in such other medium; provided, however, that if the Guarantor and the Borrower shall cease to have a currency common to them, a debt incurred by one of them in the currency of the other shall be deemed to be the external debt of the former.

So, the Bank is taking an insurance policy in case anything goes wrong in New Guinea. In view of the way the Territory is being handled politically at the moment, that could quite easily happen. The following is substituted for the last sentence of section 4.01:

Withdrawals from the Loan Account shall be made either in the respective currencies in which the cost of goods and services has been paid or is payable or in dollars, as the Bank may from time to time elect, except that where withdrawals may be made in respect of expenditures in the currency of the Guarantor or of the Borrower, such withdrawals shall be made in such currency or currencies as the Bank shall from time to time reasonably select.

So, the Bank is taking a second insurance policy by imposing those restrictions on the guarantor. In the Third Schedule, section 2.03 reads:

In carrying out the Project, ELCOM shall, in respect of contracts in excess of $A100,000 equivalent, employ contractors acceptable to the Bank upon terms and conditions satisfactory to the Bank.

How this country could ever agree to that being included in an agreement, I would not know - unless we are in daily fear of some thing or some organisation. In Article HI, under the heading ‘Management and Operations of ELCOM’, section 3.01 reads: ELCOM shall:

at all times maintain its right to carry on operations and shall, except as the Bank shall otherwise agree, take all steps necessary to acquire, maintain and renew all rights, powers, privileges and franchises which are necessary or useful in the conduct of its business;

operate and maintain, or cause to be operated and maintained, all its plants, equipment and property and from time to time make, or cause to be made, all necessary renewals and repairs thereof, all in accordance with sound administrative, financial, engineering and public utility practises;

consult the Bank before making any new appointments to the positions of General Manager, Assistant General Manager (Finance and Administration) and Assistant General Manager (Engineering).

Who is to control this project? Australia will provide a guarantee for the $23m; but it is obvious we will have no control because of the contractors’ subservience to the officers of the World Bank. Also in the Third Schedule, section 3.03 (a) reads:

ELCOM shall employ an insurance consultant acceptable to the Bank to advise ELCOM with respect to the adequacy and any necessary revisions of its self-insurance scheme as currently applied, and shall require this consultant to submit a report to it no later than June 30, 1972.

I respectfully suggest that this Bill was not given a proper passage through another place; that it has not been looked at properly; and that probably the Minister, when he introduced it, was not aware of some of the restrictive clauses in the schedules which put Australia in the situation that we have to guarantee this loan under the most restrictive provisions that could be found in association with any loan. In the first place it was the responsibility of this country to carry out the financing of a developmental work of this nature. If onethird of the loan is being financed from this source, why could not the remaining two-thirds also have been obtained from this source? I hope that the interest rate to be charged will not have the long term effect of causing high charges for power in the Territory. But of course the Government has a let out in this respect. When the repayments begin this Government will not be in office. The matter will then be a responsibility of an Australian Labor Party government which will have to ensure that the loan is properly serviced. We are not opposing the Bill, but we offer these criticisms because they are very pertinent to the case and they are on matters which should have been examined by the Government before making a guarantee of this nature.

Senator BYRNE:
Queensland

– I wish merely to indicate that the Australian Democratic Labor Party supports the Bill. When a Bill of this character comes before this chamber we should register our continuing and persistent interest in and identification with Papua New Guinea and the contribution that Australia is making to the development of Papua New Guinea. I know that we are charged sometimes regarding our contributions to the development of underdeveloped countries, but our contribution is high, particularly when we take into account our contribution to Papua New Guinea. What we are doing for that country leaves nothing for Australia to be ashamed of. This Bill is another indication of our identification, interest and support, and for that reason the Democratic Labor Party commends the Bill. We trust that the enormous project for which the loan is to be made will be of great and enduring benefit to the Territory and will proceed without interruption until its fruits can be available to all who live in the Territory.

Senator Sir KENNETH ANDERSON:
Minister for Supply · New South Wales · LP

(10.17) - I thank the Senate for its co-operation in affording this Bill a speedy passage. In indicating the views of the Opposition Senator Keeffe offered criticisms of the Bill at 2 levels. His first criticism related to the interest rate which is to apply to the loan. In the course of his remarks I interrupted him and perhaps I was a bit rude in doing so, but I was surprised at his statement about an interest rate of 4 per cent to 6 per cent. Honourable senators will be aware that the current lending rate for money advanced by the International Bank for Reconstruction and Development is 7.25 per cent per annum. Honourable senators will be aware also that the long term bond rate offered by this Government is 7 per cent per annum. The loan for which a guarantee is sought in this Bill is to be for 25 years.

Senator Keeffe:

– Was that rate what the Government pays or charges?

Senator Sir KENNETH ANDERSON:

The honourable senator has had his opportunity to speak; perhaps I can have mine. Semi-government authorities raise public loans in Australia at 7.25 per cent per annum for periods of 15 years and beyond. So the rate which is offered by the International Bank is the same as that offered for public loans to semi-government authorities in Australia. I do not think the honourable senator can criticise the Bill on the basis of the interest rate to be charged.

The International Bank for Reconstruction and Development has offered this loan to the Administration of the Territory of Papua New Guinea. The Administration has said that it wants the loan for a good and sufficient purpose, and the Commonwealth has facilitated the loan. I think it is not arguable in the world in which we live that anyone wishing to borrow money from the International Bank must pay the ruling rate of interest. This loan is for a good purpose. Senator Keeffe admits it is an excellent purpose. It is a loan for a very long term and, if I recall it accurately, it is for 25 years at 7.25 per cent per annum with a 5-year rest before repayments start. The Administrator’s Executive Council has approved the general conditions of the loan and the House of Assembly in the Territory is aware of these conditions and has passed legislation approving 2 similar loans. I suggest that that is an answer to Senator Keeffe’s criticism of the Bill and of various items in the Schedule.

I feel that I could react to some of the points made by the honourable senator. I feel bound to point out to him, not in any discourteous way, that in the Senate on 4th November 1970 in a debate on a similar Bill, the purpose of which was to assist the financing of a highways project in the highlands of New Guinea, Senator Keeffe made the following comment, which appears at page 21 12 of Hansard:

If long term reasonable interest loans can be obtained then this is the type of finance which the Government should be looking to for the more rapid development of the Territory.

Senator Keeffe:

– I did not say anything about 7i per cent.

Senator Sir KENNETH ANDERSON:

The honourable senator did not say anything about the interest rate. I think Senator Keeffe agrees that a long term loan is desirable. The only point of difference between us is that he believes that the interest rate is too high and my response is that if a loan is needed, that is the interest rate that must be paid. It is the ruling interest rate at present in the international sense and also in the Australian sense. I thank the Senate for facilitating the passage of this Bill.

Question resolved in the affirmative.

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

page 1700

MINISTERS OF STATE BILL 1971

Second Reading

Debate resumed from 4 May (vide page 1333), on motion by Senator Sir Kenneth Anderson:

That the Bill be now read a second time.

Senator MULVIHILL:
New South Wales

– The Opposition is resolutely opposed to this Bill. One could liken the advent of a new Prime Minister to Napoleon’s 100 days. Many changes are to take place but an analysis of those changes indicates that they are not the subject of sound draftsmanship. The Bill proposes the appointment of an additional Minister and a spate of Assistant Ministers but most of the song and dance in justification for the new appointments seem to centre on the new Office of the Environment. The Senate Select Committee on Water Pollution noted that there was a conflict of interest between the Minister for National Development and the Minister for the Interior in connection with water pollution. The proposed Office of the Environment will be administered by the Vice-President of the Executive Council (Sir Alan Hulme) but if it is to have any teeth it needs more than a glorified Minister of State. The powers of the Minister in this field are, to say the least, sketchy. There is no indication of where his powers will end. It is interesting to refer to a recent debate in the other place related to the environment. The then Minister for National Development, Mr Swartz, gave 3 long overdue pledges concerning his Ministry. The Minister for National Development is custodian, as it were, of forests and mineral resources and one or two other important activities bearing on the environment. However, since then we have had vivid and visible examples of the effects of mining operations at Dampier but there is no indication of the imposition by the Minister of any stringent conditions on the mining companies concerned.

One would have imagined that in bringing down a proposal to increase the number of Ministers the Government would have outlined clearly the powers of the Office of the Environment. Will it be able to resolve the conflicts between the Minister for the Interior and the Minister for National Development? Will it be able to influence the Minister for Shipping and Transport in respect of oil spillages if action to combat them is not being taken quickly enough? To take this theme to its logical conclusion we would have to consider the history of the United States over the last 20 years. The idea of having a Minister to listen to questions of environmental control without power to act means nothing. It is for that reason that, after looking at this situation, we of the Opposition find ourselves very sceptical about what will happen in this regard. While a skeleton force was prepared it is quite obvious that it did not have the technical staff to prepare a code of pollution standards. It would be incapable of undertaking a project similar to Canadian projects where a particular river or area is defined as a pollution distress area. Nothing is visualised, so far as the PostmasterGeneral and Vice-President of the Executive Council is concerned, about what would happen in this field.

We are considering the idea of taking up ministerial slack and diverting the resources of other Ministers. I do not say this in any disparaging way so far as the various Service chiefs are concerned but I believe we could have gone a long way, as Canada has done, with the integration of the various Services. I do not mean that we should destroy Service autonomy but it would be sufficient for a Minister for Defence to handle matters relating to the Royal Australian Navy, the Army and the Royal Australian Air Force. As a result of saving ministerial resources in that way, one Minister could have been earmarked for the post of Office of Environment. At the same time he could have been given a clear-cut charter as to what he could do.

There is another matter that is crying out for reform. I am dealing specifically with the Prime Minister’s Department. At the moment Australia probably is tapering off its immigration intake. I pay tribute to the very effective field staff we have handling immigration matters throughout the world. I believe that the Immigration Ministry is the logica] one to take over matters relating to Australians who will go to England now that the United Kingdom has introduced new immigration measures. This is a situation which may become somewhat tangled in the next 5 years. It probably will become tangled and it is obvious to me that the Prime Minister’s Department is not geared to cope with it. If the Government wants to do something about reconstruction, all it would have to do would be to hand this ministerial chore to the Minister for Immigration. That is the way the Labor Party would have handled this situation but unfortunately that course is not being followed.

Some of the other departments involved in this measure are not quite so important although my colleague Senator Keeffe, with his particular interest in Aboriginal affairs, quite possibly considers that, as a result of utilising redundant Service Ministers, one Minister could be given complete control of Aboriginal administration. This could happen if Cabinet duties were rationalised. This is one of those Bills that seem to have been conceived in haste. To sum up, one could say that it is quite obvious that there will be a lot of manoeuvring. As for the Office of the Environment, no indication has been given that the Government is accepting any worthwhile proposal put forward by the respective Senate committees which investigated air and water pollution. I repeat that in this respect also the Government could have picked up the slack as a result of the amalgamation of the Service ministries.

Turning now to the appointment of Assistant Ministers, I remind the Senate of the halcyon days - they were halcyon in the eyes of the Government but not necessarily in my eyes - of the era of Sir Robert Menzies. It is interesting that there are different points of view as to whether Assistant Ministers actually work. I harken again to a saving of Ministers in the defence area. My view is that the Government could have created a couple of Ministers of State and achieved the same results. 1 notice that the second reading speech refers to the idea of Ministers being available for consultation. Nobody knows whether an intermediate agency, which is what these Assistant Ministers will be, will work. I will give a classic illustration. It relates to the action of the former Minister for Trade and Industry, Sir John McEwen. As my colleague, Senator Bishop, would be aware there was grave concern 2 years ago about whether the rolling stock section of the metal trades industries was getting adequate rolling stock orders. A very complex question was involved. I can recall receiving a deputation from 11 representatives of the metal trade unions about job security. The former Minister for Trade and Industry took over from me and had a discussion with this deputation for over 2i hours. The point I am making is that there was no temptation for him to shunt these people off to an Assistant Minister who knew very little about the matter.

It seems to me that an analogy could be drawn between the functions as outlined in the Bill of the Assistant Ministers and a football team - I will not go into the merits of a particular code of football - that is on the attack and has many opportunities to score a try or kick a goal but it does not do so because too many players are in the movement and there is too much finessing. The point I am emphasising is that I cannot see where these Assistant Ministers will fit in. I hope I do not upset the decorum of the Senate by saying that I remember reading that on one memorable occasion when the creation of a massive bureau in Washington was being discussed, Harry Truman, the President of the United States of America, who was a very earthy man, listened to what was said for a while and then said: ‘That agency will be about as much use as the male nipple’. I think honourable senators understand what I am getting at. I apply this comment to the proposal to appoint Assistant Ministers. I cannot see how they will function effectively. I believe that they will gum up the works. I leave it at that.

Senator WOOD:
Queensland

– I am sure that this Bill must be of interest to every honourable senator. I feel that the Ministry is getting too large. I think that we should consider the Ministry in relation to private senators and members. I believe that 27 Ministers provide, a very strong power base against the position of private senators and members. This relationship should be kept in mind. I was concerned about the proposal to appoint an extra Minister and I let it be known that 1 was not in favour of it. I have been assured by the Prime Minister (Mr McMahon) that certain aspects will be looked at in regard to the Ministry. I think that we have reached the situation where the Ministry must not be allowed to grow any larger. Honourable senators no doubt appreciate what the position is. If on any occasion private senators or members wish to make a stand that is contrary to the view of the Ministry they will be in a weak position.

Senator Marriott:

– We always act as a team.

Senator WOOD:

– Senator Marriott is a Liberal senator. One of the very basic things about the Liberal Party of Australia is that each of its senators and members has the right to act according to his own conscience, which is a very important thing.

Senator Marriott:

– Every team man has.

Senator WOOD:

– It rather amuses me that the serious business of public life must always be related to sportsmanship or a sporting team. As a senator I have always taken the view that one comes here not just to be a rabbit but to be able to make a decision on what is right or wrong for the country. I think everybody in this chamber will agree with me when I say that I have always taken the view that I should express myself according to what I think and vote accordingly. That aspect will never change so far as I am concerned. 1 also take the view that if the private senators and members automatically say yes to everything that the Ministry does or wants to do there is no need for the private senators and members to be here. In that case we would just leave everything to the Ministry. If the Ministry must do what the Prime Minister wants we can get rid of the Ministry and leave the Prime Minister, and then we would have a dictatorship. If we want the true basis of democracy, every person in this national Parliament must be able to express himself clearly, according to his conscience and in the spirit that what he is doing is in the best interests of this country. I am quite sure, having heard Senator Marriott express his views on this subject, that that honourable senator agrees with those sentiments. Having discussed this matter with the Prime Minister, I want to say what my own feelings about this Bill were when it was first announced. It is only because of certain assurances I received from the Prime Minister that the whole structure of the Ministry would be looked at in the future when he has time to sit down and do so that I will not oppose the passage of the Bill.

Senator GAIR:
Leader of the Democratic Labor Party · Queensland

– I rise to indicate that my colleagues in the Democratic Labor Party and I will support the Bill. Like Senator Wood, I must confess that initially I was opposed to the suggestion of an additional Minister for the reason that I felt the need for being assured that the position was not just being created for some member of the Liberal Party. I had recollections of the days when Mr Menzies, as he was then, appointed Dame Enid Lyons as Vice-President of the Executive Council. He said at the time that he gave her that position because it was not very onerous and there would be little or nothing for her to do. The public was not pleased to be told by the Prime Minister that a member of the Liberal Party was being appointed as a Minister of the national Parliament because the portfolio was not onerous and would not require any great effort. I have good reason to believe that it did not please Dame Enid Lyons, who was a very active and virile woman of high mentality. It was even a reflection on her, but the fact remains that that was the statement made at the time of her appointment. I did not want to see any recurrence of that and I made it very clear to the Prime Minister (Mr McMahon) that the Bill would not have my support and the support of my colleagues unless the additional position of Minister was a position where some real work was to be done.

I am prepared to concede that with the passing of the years a lot of new responsibilities are being thrown upon the Government. Previous speakers referred to the environment and pollution of air and water, which have been the subject of investigation by Senate select committees and on which good reports have been submitted. There is the Aboriginal question, which I believe merits particular attention. There are also the other phases which are very important to the cultural life of the country and which have been receiving for far too long merely the fag end of a Minister’s day. I think they merit more attention than that. But above all I feel that the Prime Ministership itself is something which merits consideration. I do not believe that any Prime Minister, irrespective of who he is or to what Party he belongs, should be required to devote hours of his time signing vouchers, documents, schedules and things of that nature.

Senator Wood:

– The same as Ministers.

Senator GAIR:

– Well, some of the important Ministers. I agree that some of them are not fully occupied as Ministers. I can recall when there was a move to appoint an additional Minister to the new portfolio of Minister for Education and Science. I supported that appointment because the late Harold Holt who was the Prime Minister at the time had included that proposal in his policy speech. I interpreted the result of the election as a mandate for him to give effect to his promise. What is more 1 welcomed the Commonwealth’s entry into the field of education because I was fully appreciative of the inability of the State governments to measure up to the increasing demand that was being made upon them in education even though I was opposed to an additional Minister because I felt that there was room for and that there was merit in an amalgamation of services under the control of the minor portfolios. in relation to this Bill I think the Prime Minister is wise to relieve himself of a lot of the work which he as Prime Minister should not be required to do. The tasks of a Prime Minister of this nation with all its various problems are such that he needs as much time as he can devote to determine policies for the betterment, the growth and development of this country and for the welfare of its people. The calls upon his time by way of deputations, interviews and attendances at public functions from day to day are very considerable. I think the Prime Minister is very wise to endeavour to relieve himself of some of this nonimportant work which up until now has occupied so much of his time.

The activities of the new ministerial office will be varied in many ways. Just as it will relieve the Prime Minister, it will also relieve some of the more heavily pressed Cabinet Ministers. The new Minister will deal with a lot of matters which could be better dealt with under one ministerial head. Included in the administration of the new Minister will be activities relating to the Australian Council for the Arts; the Australian National Gallery; the Commonwealth Art Advisory Board, the Historic Memorials Committee; the Commonwealth Literary Fund and the Commonwealth Assistance to Australian Composers Advisory Board. All these phases of our community life have become more prominent and their activities have grown into sizeable functions. I think they merit more consideration than they have received up till now. The National Library is a very important and pleasing phase of our national life. I believe that the National Library here in Canberra is a monument to the progress that has been made in the field of libraries and literary works.

For too long the archives not only in the national sphere but also in the State sphere have received very scant consideration. We are only commencing to realise, as we are growing up and getting older, the great value of and the great necessity for the preservation of our records and historical data. Only if we give adequate attention to these things can we achieve what we want to achieve. Too frequently we have cause to grieve about the failure of our predecessors in government to do this and to do that. It is a great pity that governments in the past have not done this and not done that with a view to preserving the records of this nation, its growth and its development. It is not until we engage in research for some reason or another that we find the absence of a lot of records that should be available to us. The Commonwealth War Graves Commission has done excellent work over the years and the condition of the few war graves that I have had the privilege of seeing is really a credit to its work. I think it should be maintained as long as is required. There is much that could justify the appointment of an additional Minister but that does not eliminate - again I agree with Sentaor Wood - the necessity for the Government at some appropriate time to review the quantum of work associated with each department.

T am not audacious enough to make an assessment of any of the departments, and it would be audacity on my part because I have never been charged with the responsibility of administering any of them. But I have my opinions based on my power of assessment of work associated with departments. Having been a Minister for 15 years I have some idea of the volume of work associated with particular departments, and I feel that some of the departments - I may be wrong and I am prepared to be corrected - are not busy departments; let me put it that way. They are not departments that command or require the full time attention of the Minister. In the main most of the work is being done by executive officers of the department, and beyond matters of policy which are determined either by himself or by Cabinet on a submission that he makes, and which has been prepared for htm by his officers, he is not crowded out with work. He is not crowded out with the necessity of making many major decisions in a week or a month and hence he could not be classified as a very busy Minister.

Is there any particular reason why the Department of Housing could not be linked with the Department of Works especially as tourism has been taken away from the Minister for Works and given to the Minister who will be appointed? Is there anything against this suggestion? I do not know. We have to examine these things. Why could not the Departments of the

Navy, the Army and Air be amalgamated under one Minister, a Minister for Defence, allowing these Departments to function with autonomous powers and independent of each other but brought together under one head? I may be astray in my thinking on this matter but nevertheless I believe these suggestions are worthy of consideration.

The Repatriation Department is also open to this treatment. Honourable Senators may make their judgments on its administration, but the Repatriation Act shows very clearly that the Minister for Repatriation has little or no power of intervention. All decisions are the subject of examination by medical boards, appeal boards and other boards set up under the Act. All these decisions are taken out of the hands of the Minister. They are decisions of boards representative of the medical profession, the Returned Services League of Australia and others. 1 cannot see that the Repatriation Department is such a busy department that it could not be embraced within the Department of Social Services, particularly if matters relating to Aboriginals were taken from the Department of Social Services and put into the Ministry which will be established. Repatriation could be placed within the Department of Social Services without burdening any Minister. These are my thoughts on this question. However I believe it would be unfair and too much to expect that anyone taking over the job of Prime Minister between elections should make revolutionary changes in his Cabinet set up. No doubt he felt the necessity of relieving himself of a good deal of the time consuming functions and eliminating the hours of signing documents and papers which could be done by an assistant Minister. Also some of the major members of the Cabinet were working at high pressure and could be relieved by an assistant Minister.

Generally we of the Australian Democratic Labor Party are prepared to support the Bill hoping that the Prime Minister, at an opportune time, will make a complete review of the Cabinet set up. We are all conscious that the nation is growing. There is an increasing demand by the public for additional governmental administration and control of many phases of our daily lives. Our people are relying more today than probably ever before on Government assistance, Government aid, Government direction and Government policies in so many of our fields of activity and growth. As I said, who was concerned about pollution of water or of the air 25 years ago? An occasional complaint might be made about a smoggy morning or the stench from a tannery, but beyond that no complaints were ever heard. But today people are becoming conscious of the problem caused by increased population, motor vehicles and other reasons for pollution of the air and water. Not very many years ago our streams were polluted by the sugar mills. Molasses was allowed to run into the streams before its commercial value was realised. Big factories such as Courtaulds (Aust.) Ltd send their effluent into the streams and destroy the fish life in many places. This has happened in many cases.

These are new matters which rightly demand the attention of the Government. At one time no-one was concerned about conservation, but there is a lively interest in it today. I think that all of us in varying degrees are interested in conservation and we expect the Government to give a lead and to co-ordinate efforts to solve conservation problems. The Government should not allow people just to please themselves in alienating land and in destroying the natural beauties of the seaside, the mountains and the hills. All these things have to be properly organised, co-ordinated and administered.

My Party will support the Bill, hoping that the new Minister - whoever he might be - will discharge his responsibilities actively and will handle efficiently the matters which have been entrusted to him. In the meantime we trust that the Prime Minister will make a proper review and assessment of the amount of work that the other Ministers are performing. I know that in any Cabinet some Ministers are overworked and others are not fully occupied. Let us balance them properly and relieve those who are overworked and give a little more to those who are not fully occupied.

Senator SIM:
Western Australia

– While I support the Bill, I do so with some degree of reluctance. I would have been far happier if the Prime Minister (Mr McMahon), in justification of the appointment of an additional Minister, had been able to inform the Parliament that he had carried out a review of the present responsibilities and had been able to rationalise the Ministry.

Senator Cavanagh:

– Did you tell him that?

Senator SIM:

– Let me make my own speech. You might get the chance to tell your Leader something one of these days. You probably would not be game to. I do not want to be helped by Senator Cavanagh. I am merely expressing my view. I find it hard to believe that rationalisation was not possible. When I look at this Bill and its proposal to appoint Assistant Ministers whose responsibilities seem to be not clear, it appears to me that the power of the Executive is being strengthened.

Debate interrupted.

page 1705

ADJOURNMENT

The PRESIDENT:

-(Senator Sir Alister McMuilin) - Order! In conformity with the sessional order relating to the adjournment of the Senate, I formally put the question:

That the Senate do now adjourn.

Senator CAVANAGH:
South Australia

– I will take only a few moments of the Senate’s time to speak on what I think is an injustice to the Canberra police who protect foreign embassies in Canberra. Today an answer was given by the Minister for the Interior (Mr Hunt) to Senator Keeffe in relation to the cost of protection of the embassies including the current weekly cost. On my information this current weekly cost is being reduced by the Minister in relation to payments to constables who are protecting the embassies by his non-observance of the current award. I ask the Minister to observe the award and pay the policemen accordingly. When guards were placed at the foreign embassies there was some protest by policemen who said that they were parading continuously outside the embassies for the whole of their tour of duty and that the conditions of service were not satisfactory in view of the rewards they were getting. At that time it was necessary for any policeman who desired to use the toilet to be transported from the embassy to some other place where there was a toilet. Consequently the police officers’ association made application to the appropriate wage fixing tribunal to consider this question. The tribunal varied Determination No. 1 of 1947 by including in clause 3 the following:

Any member performing guard duty at a foreign embassy, residence or like place, who is not provided with proper facilities, shall be paid an allowance at the rate of $1 per hour or part thereof.

The policemen accepted this as suitable compensation for the difficult conditions which they had to put up with when patrolling the embassies.

The determination also provided that proper facilities shall be taken to mean an hygienic toilet, hand washing facilities, heating and shelter from extreme climatic conditions. If the policemen were in a glass guardhouse at the embassy gate where they were not exposed to extreme climatic conditions then the $1 an hour would not be paid to them. The Department had an alternative to paying $1 per hour to the policemen by providing them with such facilities as hygienic toilets, hand washing facilities, heating and shelter from extreme climatic conditions. What has now happened is that a flat attached to each embassy has been made available to the policemen. I believe this is so at the South African and Russian embassies. The flat is available for use by policemen at such times as they find it necessary to use the toilet. Therefore, they have the hygienic toilets and the hand washing facilities - whether or not there is heating there I do not know. But the shelter from extreme climatic conditions is provided only at such times as the policemen find it necessary to use the toilet. They cannot guard the embassies while they are in the flats that have been provided, with the result that they patrol the embassies in the same way as they have always patrolled them. Therefore, the facilities provided are not in keeping with the award granted by the Commissioner.

As these facilities have been provided - this has benefited the Department because it does not have to transport the policemen to another location when they desire to use the toilet - the Department has refused payment of the $1 an hour provided under the award. Compliance with the award is not being observed today in that they have no shelter from extreme climatic conditions. It is still necessary to patrol the grounds continuously and they have the use of the facilities only when they have to use the toilets. Therefore there is noncompliance with the determination. There is a responsibility on the Minister to pay the special allowance fixed by the award for this type of work, but the payment is refused. The police officers are at a point of rebellion in relation to this question. How does one get a government to observe an award? I do not know, but I am raising this matter tonight in the hope that the Minister for Civil Aviation (Senator Cotton) who in this chamber represents the Minister for the Interior will take up the question with a view to rectifying the matter and granting retrospective payment to the policemen for the time that the Government has been in breach of the determination.

Senator COTTON (New South Wales-

Minister for Civil Aviation) (11.6) - I remember some discussion about the security guards at the various embassies in Canberra when Estimates Committee D was examining the supplementary estimates of the Department of the Interior, but nothing to the extent that Senator Cavanagh has mentioned tonight would have come out of that discussion. It related more to the number of people involved, rates of pay and the embassies to be guarded. The best thing I can do is to refer the honourable senator’s comments to the Minister for the Interior (Mr Hunt), and I cannot do that before tomorrow morning, but I shall certainly do so and ask him what can be done about this matter. He will have to make the decision because he is the responsible Minister.

Question resolved in the affirmative.

Senate adjourned at 11.7 p.m.

Cite as: Australia, Senate, Debates, 11 May 1971, viewed 22 October 2017, <http://historichansard.net/senate/1971/19710511_senate_27_s48/>.

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