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Senate
27 September 1972

27^th Parliament · 2^nd Session

SOCIAL SERVICES
- Petition
NOTICE OF MOTION
QUESTION
- POLITICAL PARTIES’ HEALTH PROPOSALS
QUESTION
- TAXATION
QUESTION
- TELEPHONE DIRECTORY
QUESTION
- TERRITORIAL WATERS
QUESTION
- UGANDA: AUSTRALIAN CITIZENS
QUESTION
- UNITED NATIONS PEACE KEEPING FORCE
QUESTION
- INTERNATIONAL TERRORISM
QUESTION
- PRINTING INDUSTRY
QUESTION
- RACISM
QUESTION
- PARLIAMENTARY CLOCKS
QUESTION
- TERRORIST OUTRAGES
QUESTION
- TERRORIST OUTRAGES
QUESTION
- ARREST OF YUGOSLAV
QUESTION
- ABORIGINES
QUESTION
- COMPANY TAXATION
QUESTION
- DEPORTATION OF YUGOSLAV
QUESTION
- QUESTIONS
QUESTION
- ANTI-SMOKING CAMPAIGN
QUESTION
- VIP AIRCRAFT
QUESTION
- GENERAL PRACTITIONERS
QUESTION
- SOLAR ENERGY
QUESTION
- REPATRIATION PENSIONS
QUESTION
- ANTI-SMOKING CAMPAIGN
QUESTION
- DECENTRALISATION
QUESTION
- QUESTIONS
QUESTION
- MINISTERIAL HOUSING
QUESTION
- PARLIAMENTARY LIBRARY
QUESTION
- RACISM
QUESTION
- TELEVISION: SUNDAY MORNING PROGRAMMES
QUESTION
- SEAWATER
QUESTION
- THE PARLIAMENT
QUESTION
- ANTARCTIC SEALS
QUESTION
- RACISM
QUESTION
- PURCHASE OF AIRCRAFT FROM JETAIR AUSTRALIA LIMITED
STEEL PIPE CONTRACT
- Formal Motion for Adjournment
SERVICES CANTEENS TRUST FUND
AUSTRALIAN ATOMIC ENERGY COMMISSION
AUSTRALIAN CAPITAL TERRITORY
AUSTRALIAN BROADCASTING COMMISSION
QUESTION
- SENATE STANDING COMMITTEE ON SOCIAL ENVIRONMENT
QUESTION
- PLACING OF BUSINESS
QUESTION
- OVERSEAS INVESTMENT IN AUSTRALIA
AGED PERSONS HOMES BILL 1972
- Second Reading
INCOME TAX BILL 1972
- First Reading
- Second Reading
REPORTED HIJACKING OF AIRCRAFT
INCOME TAX BILL 1972
- Second Reading
INCOME TAX ASSESSMENT BILL (No. 5) 1972
- Second Reading
SALES TAX (EXEMPTIONS AND CLASSIFICATIONS) BILL (No. 2) 1972
- Second Reading
EXPORT PAYMENTS INSURANCE CORPORATION BILL 1972
- Second Reading
SOFTWOOD FORESTRY AGREEMENTS BILL 1972
DISSENT FROM RULING
- In Committee
QUESTION
- STEEL PIPE CONTRACT
HIJACKING OF AIRCRAFT
- Ministerial Statement
QUESTION
- STEEL PIPE CONTRACT
ADJOURNMENT
- National Service
ANSWERS TO QUESTIONS UPON NOTICE
SUBSIDY TO SHIPBUILDERS
- (Question No. 2418)
HARBORD POST OFFICE
- (Question No. 2427)
AUTOCEPHALIC GREEK ORTHODOX CHURCH
- (Question No. 2390)
RESEARCH AND DEVELOPMENT
- (Question No. 1810)

The PRESIDENT (Senator the Hon. Sir Magnus Cormack) took the chair at 10.30 a.m., and read prayers.

page 1195

SOCIAL SERVICES

Petition

Senator POKE:
TASMANIA

– I present the following petition from 68 citizens of the Commonwealth:

To the Honourable the President and Members of the Senate in Parliament assembled. The petition of the undersigned respectfully showeth:

That the rates charged by local councils and shires are rising rapidly and are beyond the capacity of pensioners to pay.

That a Commonwealth grant be made to local authorities and thereby enable councils to make a 50 per cent remission on pensioners’ water, sewerage and general rates.

Your petitioners most humbly pray that the Senate, in Parliament assembled, should give urgent attention to this heavy burden on persons living on social service pensions.

Petition received and read.

page 1195

NOTICE OF MOTION

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

– I give notice that on the next day of sitting 1 shall move:

That leave be given to bring in a Bill for an Act relating to charges in respect of Commonwealth air navigation facilities and services.

page 1195

QUESTION

POLITICAL PARTIES’ HEALTH PROPOSALS

Senator O’BYRNE:
TASMANIA

– My question is directed to the Minister representing the Acting Minister for Health. Will the Government repudiate the action of the Western Australian division of the Liberal Party in sending a letter to general practitioners asking then to condemn Labor Party health proposals to their patients? Will the Minister support the comments which were made last night by the President of the Australian Medical Association who strongly criticised th* Western Australian Liberals for their action and agreed that Labor’s health proposals did not constitute nationalisation of the medical profession?

Senator GREENWOOD:
Attorney-General · VICTORIA · LP

The PRESIDENT:

The PRESIDENT:

– Order I think that in the rearrangement of ministerial responsibilities this question should have been directed to Senator Cotton.

Senator COTTON:
LP

– I know of the matter mentioned by the honourable senator. I think there was an article on it in the National Times’. 1 am not sure when it was, but I think it was only a few days ago. The article referred to the practice. It also referred to comments made by the Deputy Commissioner of Taxation in New South Wales, Mr Gray, in which he pointed out that it was the responsibility of the Commissioner of Taxation to assess back into income any such benefit as could be construed as income and to make allowances for it. I know the Taxation Office is conscious of this matter. I think that the remedy is in the area of bringing it back into the income of the recipient. Undoubtedly there is an area here that needs watching very closely. I will be happy to refer the question to the Treasurer and through him to the Commissioner of Taxation. I think that the honourable senator can regard the matter as being under pretty close scrutiny.

page 1199

QUESTION

DEPORTATION OF YUGOSLAV

Senator GEORGES:

– I direct a question to the Minister representing the Minister for Immigration. Was a Yugoslav arrested in Melbourne over the weekend? Was that Yugoslavia subject to a deportation order? What was the reason for that deportation order?

The PRESIDENT:

- Senator Greenwood, in answering this question I ask you to bear in mind my previous ruling on matters that are in the area of sub judice. I will allow the question.

Senator GREENWOOD:
LP

- Mr President, it may be that you have knowledge that I lack and that Senator Georges has knowledge that I lack. I am completely uninformed about these matters. I will make inquiries as I indicated I would in relation to the other subject matter to which the honourable senator referred which, I would have thought, is identical or is linked with the question that he now asks. I will get the information to him as soon asI can.

page 1200

QUESTION

QUESTION

QUESTIONS

The PRESIDENT:

– I make the observation that as the business evolves during the rest of this morning honourable senators will find that they have a massive work load for today; so I would like questions without notice to be concluded as soon as honourable senators feel that they have reached the stage where they do not really want any more questions answered today.

page 1202

QUESTION

MINISTERIAL HOUSING

Senator McLAREN:
SOUTH AUSTRALIA

– My question, which is directed to the Minister representing the Minister for the Interior, arises out of the statement he made to the Senate last night in relation to houses occupied by Government Ministers. I refer to the part of the statement in which he said:

Ministers who occupy houses made available by the Government will be required to vacate within a reasonable time after they leave the Ministry . . .

What does the Government consider to be a reasonable time? In another part of the statement he said: . . if they wish they will be given, priority in renting a government flat

Will the priority given to ex-Ministers in their applications to rent government flats mean that applications of persons already on the waiting list will be superseded by those of back bench members of the Parliament?

Senator COTTON:
LP

– As I only represent the Minister for the Interior, questions seeking elaboration of points in the statement that was made last night will have to go to him. I cannot say what is a reasonable time; nor can I anticipate who will be back benchers in the future, although I have a reasonable suspicion that the present members of the Opposition will be forever after.

page 1203

QUESTION

PARLIAMENTARY LIBRARY

Senator GIETZELT:

- Mr President, my question is directed to you. Is it a fact that the statistical research section of the Parliamentary Library is to be shifted from this building to another publicly owned building because of space considerations? If that is so, could the matter be reconsidered having regard to to the fact that this section of the Library is used extensively by members of both Houses of the Parliament and this would be a very detrimental step to take in regard to the use of the facilities of the Library?

The PRESIDENT:

– The basic problem that we have in Parliament House is the pressure on space everywhere. One of the areas in which the space problem has been felt most severely is the Library. It is the old story of trying to pour a quart of water into a pint pot. The Parliamentary Librarian is looking at the matter of how certain echelons of the Library can be put outside this building in better working conditions than exist at present. Arising from that, there are problems in that we cannot further elaborate the research section of the Library. That is a matter of very great concern to me as Chairman of the Library Committee. I certainly will bear the honourable senator’s question in mind when I next discuss this matter with the Parliamentary Librarian. I will see what is the current situation in respect of this accom modation problem which affects the Library so deeply and which I cannot relieve except by finding accommodation outside Parliament House. I add the rider that in my discussions I have always said that a physical division of the Library does not necessarily mean that the research section will start to falter, because with the installation of a modern communications system between the outside echelons and the nerve centre of the Library I do not think much would be lost.

page 1203

QUESTION

RACISM

Senator WOOD:

– I ask the Minister representing the Minister for Foreign Affairs another question, following my previous one about Uganda. Does he remember, on the occasion of the visit of the South African football team to Australia last year, the very noisy demonstrations and protests made by so many socalled racists against that team coming to Australia? Has the Government received any protests from any of the individuals or organisations, which made such a grand display on that occasion, against the atrocities that Uganda is now committing in its extreme racist policy towards Indians and Pakistanis?

Senator WRIGHT:
LP

– No such protests have come to my knowledge.

Senator Willesee:

– Apart from Senator Wood’s.

Senator WRIGHT:

– I regard Senator Wood’s question as a very thoughtful one which throws into relief the difference between political ideologies for party political purposes and genuine beliefs for the purpose of opposing racism.

page 1203

QUESTION

TELEVISION: SUNDAY MORNING PROGRAMMES

Senator DOUGLAS MCCLELLANDMy question is to the Minister representing the Postmaster-General. Does the Minister recall the Acting Postmaster-General on 7th April last indicating that the Government intended to introduce amendments to the Broadcasting and Television Act within 10 days from that date in order to clarify the powers of the Australian Broadcasting Control Board with regard to programming on Sunday mornings? Did the Minister himself say last May that because the Government did not have the time in the last sessional period to introduce the legislation it would do so in the Budget session? I ask the Minister: Does the Government intend introducing the legislation in this session, and pending the introduction of any legislation that might come forward, what control is able to be exercised by the Australian Broadcasting Control Board in regard to Sunday morning programming?

Senator GREENWOOD:
LP

– I must confess that my recollection is not as accurate as I would like it to be and, therefore, I am unable positively to say affirmatively or negatively what my recollection is in regard to the senator’s first question. As to whether or not action is proposed to be taken, I do not think the legislative programme which is available for the next 3 weeks could possibly enable the legislation to which he refers to be introduced. But this essentially is a matter for the Government to determine.

In regard to the other matters, which I think do involve some question of interpretation and possible policy for the Australian Broadcasting Control Board, I can only suggest that in the light of the answer I have just given to the honourable senator he might put an appropriate question on the notice paper so that the PostmasterGeneral can answer it.

page 1204

QUESTION

SEAWATER

Senator KEEFFE:

– My question is directed to the Minister representing the Minister for National Development and is supplementary to the question asked by Senator Webster on solar power. I ask: What action has been taken by the Government and its various departments to investigate the use of seawater for domestic and commercial purposes, and has any research been conducted into the possibility of harnessing tidal waters for electric power production.

Senator COTTON:
LP

– The honourable senator’s question is equally helpful. An investigation which was undertaken on the north-west coast of Western Australia indicated that there is a tremendous opportunity for tidal power generation in that area, which is not very far from the pearl culture operation at Kirrie Bay. I think it was estimated that the tidal power capacity in that area was such that it would be able to supply one-third of Australia’s total power requirement. A feasibility study has been carried out. Although this study was not done in great depth it is obvious that there is a potential.

The difficulty is that the source of power generation is a long, long way from a market for the power. However, if a big mineral resource in the north-west is developed or an oil development is commenced on the north-west shelf this might change. Some work has been done on the desalination of seawater in regard to the plastic bead column process which is of interest. I think all these things are worthy of attention. I take the honourable senator’s suggestion and I shall direct it to the Minister for National Development.

The PRESIDENT:

– May I encourage honourable senators to remember that time is a fleeting animal.

page 1204

QUESTION

THE PARLIAMENT

page 1205

QUESTION

ANTARCTIC SEALS

Senator MULVIHILL:

– I ask the Minister representing the. Minister for Foreign Affairs: When does the Government intend introducing complementary legislation which would enable Australia to sign the convention for the conservation of Antarctic seals? What other countries are involved in the. convention structure? Will Australia be providing staff to monitor the Antarctic seal population?

Senator WRIGHT:
LP

– In order to answer that question I regret that I will have to refer to the Department for detailed information. I ask the honourable senator to put the question on notice.

page 1205

QUESTION

RACISM

Senator GEORGES:

– I ask the Minister representing the Minister for Foreign Affairs: Why, in his answers to the 2 questions asked by Senator Wood, did he not acknowledge the strong question asked by Senator Wheeldon which firmly defined the attitude of the Opposition in relation to what i.s going on in Uganda so that Senator Wood, who was obviously not in the chamber at the time, could be properly informed?

Senator WRIGHT:
LP

– With all the goodwill in the world and with all the intellectual effort I can summon I fail to see the logic of the 2 branches of the honourable senator’s question.

page 1205

QUESTION

PURCHASE OF AIRCRAFT FROM JETAIR AUSTRALIA LIMITED

Ministerial Statement

Senator WRIGHT:
Minister for Works · Tasmania · LP

– In view of references made in the Senate last night, at the earliest stage today I ask for leave to make a statement and to table papers in connection with the Jetair Australia Limited matter.

The PRESIDENT:

– Order! Is leave granted? There being no objection, leave is granted.

Senator WRIGHT:

– 1. The Commonwealth’s purchase of 6 DC3 aircraft from Jetair Australia Limited has been discussed in the Parliament on a number of occasions. The matter was raised most recently by Senator Turnbull on 20th September. I gave then, as Ministers have done on all other occasions, a complete denial of allegations of impropriety on the part of any Minister of the Crown in regard to this transaction. I repeat that denial, and I make the same denial in relation to any officer of the Commonwealth Public Service.

The negotiations for the purchase of the 6 DC3 aircraft from Jetair were instituted by departmental officers. The negotiations were conducted throughout by departmental officers, without the intervention of any Minister, and without the participation of any Minister, until the point was reached when the Secretary to the Department of Foreign Affairs made a recommendation to his then Minister, the present Prime Minister (Mr McMahon), that the aircraft be acquired by the Commonwealth for foreign aid purposes. Mr McMahon approved that recommendation.
The history of this matter has been traced in previous statements in the Parliament, but I shall again state some of the main points in the sequence and history of the matter.
In 1969 the Department of Foreign Affairs investigated the possibility of supplying 5 DC3 aircraft as foreign aid to Nepal - 2 aircraft - and Laos - 3 aircraft.
Five Royal Australian Air Force DC3 aircraft, declared to the Department of Supply as surplus, were bought for this purpose at a total cost of $60,000. Two were purchased on 21st November 1969 and 3 on 15th April 1970. The aircraft were in a military configuration, and it was intended to convert them to the civilian configuration required, and to do work necessary to allow the aircraft to be issued with civilian certificates of airworthiness. As at December 1970, the estimated cost of purchase, conversion and delivery was $425,000, and delivery could not be expected until late 1971.
On 5th December 1970, Jetair advertised its fleet of 6 DC3 aircraft for sale. The Department of Foreign Affairs was immediately interested, as 4 of the aircraft were passenger aircraft, and 2 were freighter aircraft, and all carried civilian certificates of airworthiness.
It was apparent that these aircraft could be made available quickly to meet the urgent needs of Nepal and Laos, whereas the ex-RAAF DC3 aircraft would take most of 1971 to refurbish, convert and deliver.
The overall delivered cost of these 6 passenger/freighter aircraft was estimated at $360,000, that is, $65,000 less than the cost of buying, converting and delivering the 5 ex-RAAF aircraft.
These aircraft, although in excess of the 5 required for Nepal and Laos, interested the Department because it had learned towards the end of 1970 of the need of the Khmer Republic for aircraft. In response to a cable sent from Australia, this need was confirmed early in January 1971 as a high priority need for the Khmer Republic. It was a need which could be met by aircraft in the RAAF type configuration.
Inspections of the Jetair fleet were first made on the 17th and 18th December 1970 by senior officers of the Aid Branch of the Department of Foreign Affairs and an engineer and 3 technical officers from the Aircraft Branch of the Department of Supply. The 6 aircraft were in a fair to very good condition; were in the required configurations, including one 21-seater; and, most importantly for Commonwealth purposes, had civilian certificates of airworthiness and could be delivered within a minimum of time.
Officials discussed with Jetair a possible purchase price. Jetair sought a price of §60,000 per aircraft, but as discussions developed it was apparent that if a buyer were prepared to take the whole fleet Jetair would sell for substantially less per aircraft.
There was general agreement among officials of the 2 departments that having regard to the condition of the aircraft, their internal configurations and the status of certificates of airworthiness, a price between $250,000 and $300,000 would be reasonable for the 6 Jetair DC3s plus spares.
A submission was then made by the Secretary of the Department of Foreign Affairs to the then Minister, the Right Honourable William McMahon, the present Prime Minister. It is a lengthy document which the Senate will see in the papers. It is dated 31st December 1970 and is minuted by the Minister as approved on 1st January 1971.
On 6th January 1971 the Department of Foreign Affairs wrote to the company offering $275,000 for the aircraft, and adding:

The actual purchase of the planes shall be carried out on our behalf by the Department of Supply, which will contact you in the near finnie.

When purchase details are completed we plan to issue a press statement announcing the acquisition of the planes and their intended destination as part of the Australian aid programme.

And until this was done the company was requested to keep the matter confidential.

On the same day, 6th January 1971, the Department of Foreign Affairs, by letter to the Secretary of the Department of Supply, advised the details, adding:

This department would be grateful if you could finalise purchase details with Jetair on our behalf. and requested the Department of Supply to check the company’s title to the aircraft.

On 25th January 1971, the Aircraft Division of the Department of Supply in a minute to Contracts Division, reported:
1. The aircraft were inspected by officers of this Branch and it was agreed that very little work would be required to bring them into the condition required for presentation to the ‘aid’ recipients;
2. . . . The price $275,000 compares favourably with the value assessed by means of the TAA formula $227,587.

I should explain that an addition to the formula must be made for the value and condition of passenger fitments and spares supplied. The minute continues:

From a value point of view 6 aircraft can be purchased from Jetair and placed in ‘good second hand condition’ for an amount approximately equal to what would be paid for the procurement and conversion, of 5 RAAF aircraft.
1. Then questions arose as to the procedure adopted by Department of Foreign Affairs in approaching the sale negotiations, and in view of Treasury Regulation 52 (1), which reads:

Subject to any Act making provision with respect to contracts for supplies and subject to the next succeeding sub-regulation, contracts shall not be entered into, and orders shall not be placed, for supplies the estimated cost of which exceeds one thousand dollars unless tenders have first been publicly invited for those supplies.

Sub-regulation (2.) (e) (v), as in force at the time, provided that the requirement hi sub-regulation (1.) of Regulation 52 did not apply to supplies in respect of which the Secretary to the Department of the Treasury, or an officer authorised by him, certifies that the inviting of tenders is impracticable or inexpedient, being supplies approved by, or to be obtained by, the Contract Board of the Department of Supply.

An exchange of correspondence took place between the 2 Departments, and on 3rd February 1971 the Secretary of the Department of Supply made a submission to his Acting Minister in which he exhibited concern about procedural aspects but nevertheless recommended ‘that covering approval be given to the arrangements already made by the Department of Foreign Affairs for the purchase of 6 DC3 aircraft and spares from Jetair Australia Limited, for $275,000’.
The Acting Minister for Supply was then the Honourable Malcolm Fraser, M.P., who endorsed the submission with 2 queries. These were answered by the Department, and on 9th February 1971 - 6 days after the submission was first put in - the Acting Minister endorsed the paper: ‘Agreed, but bring to the notice of Senator Anderson when he returns’.
There has been an allegation that the Government has tried to conceal a letter signed by the Acting Minister critical of the then Minister for Foreign Affairs. The Government knows of no such letter.
On 12th February 1971, Senator the Honourable Sir Kenneth Anderson wrote the following letter to the Minister for Foreign Affairs:

I refer to the proposed contract with Jetair (Australia) Limited for supply of six DC3 aircraft.

As discussed between officers of our departments it is unfortunate that normal purchasing procedures were not followed; however in the light of the commitment by your department, I have approved that the Contract Board may place the necessary confirming order with the company.

You will understand that in the circumstances any approaches by news media or any question in Parliament in relation to the arrangement could most appropriately be dealt with by you or on your behalf.

The Minister’s letter was directed to the non-observance of normal purchasing procedures. The letter did not in any way detract from the conclusion reached by the Acting Minister, on the advice of the Secretary of the Department of Supply, regarding the substance of the transaction.
What is abundantly clear from all this is, as stated in the Senate last week, that the Commonwealth has been able to supply 11 aircraft to 3 friendly South-East Asian countries for a total cost of $480,000. Had the Department not initiated action to acquire the Jetair aircraft the Commonwealth would have supplied 5 aircraft only for a cost of $425,000.
This shows that the arrangement negotiated for the purchase of these aircraft from Jetair was a sound commercial transaction. The purchase enabled Australia to supply 11 aircraft to 3 countries, instead of 5 aircraft to 2 countries, at a cost which was only about $55,000 more than the total cost would have been had it not bought the Jetair aircraft.
Tt will be noted in these papers that before seeking ministerial approval for a purchase order on Jetair, the Department of Supply meticulously pursued the whole range of inquiries that it customarily makes in dealing with contracts proposed to be confined to a single supplier - timely availability, other suitable sources of supply, price in relation to market value and so on. Having satisfied itself on all relevant points, the Department then sought from the Acting Minister for Supply approval to place the order.
The procedures of the Department of Foreign Affairs involved a technical breach of Treasury regulations. The papers show that the departmental files were examined, and comment was invited from the late Sir Kenneth Bailey whose memorandum of advice dated 22nd February 1971 is as follows :

I think you asked me to look at the papers on the purchase of the 6 Jetair Dakotas, from the point of view of the Department’s action.

It seems to me quite clear that the letter sent to the Company on 6th January last was without authority. The procedures for such a purpose arc regulated either by the Treasury regulations or by the Supply and Development regulations, or both. In general, action is required on the part either of the Commonwealth Stores Supply and Tender Board or of Hie Contract Board (I am myself not sure which). In the event the

Department of Supply has taken the necessary action to make the proceedings regular. I would not think any element now remains either of illegality or of administrative irregularity.

I emphasise the words contained in that last sentence -

This however is a matter on which, if it becomes necessary, the Attorney-General’s Department would need to advise.

As I understand the position, no legal effect is now attributable to the Department’s letter to the Company of 6th January last. It is somewhat confused in expression, but I think may best be regarded as an intimation to the Company that the Department would recommend to the Department of Supply the purchase of the aircraft at the price stated.

I repeat those words:

. that the Department would recommend to the Department of Supply the purchase of the aircraft at the price stated.
The Auditor-General’s office inquired into the matter on 7th May 1971. Its inquiries as to the breach of Treasury regulations appear in the papers.
On the question of Department of Foreign Affairs procedures, the Secretary of that Department wrote to the AuditorGeneral’s office on 9th July 1971 as follows: . . It is agreed that there was a technical breach of Treasury Regulation 52. It was, however, unintentional and at no time do we believe there was any intent to circumvent the intention of the regulation. At all stages in these negotiations, including inspections and price discussions, we ensured that the Department of Supply was present. Also, our letter to Jetair made reference to the necessity of the Department of Supply actually making the purchase (and a copy was sent to Supply). Our error was in assuming that, by keeping one Division (the Aircraft, Guided Weapons and Electronics Supplies Division) of the Department of Supply, fully informed and present in negotiations, we were fulfilling Commonwealth procurement requirements. It has since been pointed out to us, by Supply, that we should also have had full consultations with the Contracts Branch of Supply and not assumed (as we did) that the Aircraft Division would keep Contracts Branch of the same Department informed. At this time, Jetair were wanting to wind up that part of their organisation which had been retained to handle the disposal of their DC3 fleet, and were seeking written expression of Government intent. Having received approval to commit funds for this purpose, and mistakenly believing that all appropriate sections of the Department of Supply were supporting the purchase, the letter of intent dated 6th January 1971 was sent, and a confirmation of acceptability dated 7th January 1971 was received from Jetair.

No further action by the Department was called for.

The transaction -
1. was initiated by the officers of the Department of Foreign Affairs on noticing public advertisements offering for sale aircraft very suitable for the Department’s aid requirements;
2. enabled the Government to avoid heavy costs of conversion of military aircraft to civilian configuration;
3. enabled the delivery of 11 aircraft as aid to 3 friendly countries at a total cost of $480,000, in lieu of 5 aircraft to 2 of those countries at $425,000;
4. although there, was an initial breach of Treasury regulations requiring public tenders, the Contracts Board and Department of Supply ensured by full inquiry that the aircraft purchased were the only ones available suitable to the Commonwealth requirement;
5. the price was carefully considered, and was, in the opinion of competent officers, reasonable.
As I have said, the arrangement for the purchase of these aircraft from Jetair was a sound commercial transaction.
It is abundantly clear that there was a total absence of any impropriety on the part of any Minister or official. The papers now being tabled confirm this beyond question. Specifically they show how absurd are the suggestions and innuendos which have been made about the personal involvement of the. Prime Minister.
For convenience, certified copies of the papers are being laid on the table. The original papers are available for perusal by any honourable senator upon request.
In accordance with ordinary parliamentary practice, there have been some exclusions from the papers tabled. These are in a separate group and are available for perusal upon request by the Leader of the Opposition in the Senate and the Leader of the Democratic Labor Party. The latter documents are of the following categories:
1. documents containing confidential matters relating to other governments;
2. a detailed listing of tenders received by the Department of Supply for the sale of Dakota aircraft 1968 considered to contain confidential commercial information;
3. the Trans Australia Airlines formula for valuation of aircraft which was obtained in confidence from TAA for purposes of the transaction;
4. several volumes of papers dealing with technical aircraft matters, and the execution of purchase contracts and other contracts for refurbishing and ferrying of the aircraft - excluded because of their bulk.
Mr President, I table the papers of the Departments of Foreign Affairs and of Supply relating to the purchase of the aircraft.

Senator MURPHY:
New South WalesLeader of the Opposition

– by leave - Mr President, a number of honourable, senators find this affair extremely disturbing. We would like the opportunity of studying the papers which have been tabled, together with the statement by the Minister for Works (Senator Wright), and then to determine what further action should be taken in regard to this matter.

Senator Wright:

– We. will facilitate any debate.

The PRESIDENT:

– That means, Senator Murphy, that you can bring it on for discussion by notice of motion.

page 1209

STEEL PIPE CONTRACT

Formal Motion for Adjournment

The PRESIDENT:

– I have received the following letter from Senator Murphy:

Mr President,

Pursuant to standing order 64, I hereby give notice that this day I shall move:

That the Senate, at its rising, adjourn till tomorrow at 9.55 a.m. for the purpose of debating a matter of urgency, namely:

The failure of the Government to take action to protect Australian employment and industry in the supply of the Moomba-Sydney pipeline.

Is the motion supported? (More than the number of senators required by the Standing Orders having risen in their places).

Senator MURPHY:
New South WalesLeader of the Opposition

– I move:

This is the procedural way in which the Senate is enabled to discuss now a matter of urgency. The matter or urgency to which I refer is as follows:

The failure of the Government to take action to protect Australian employment and industry in the supply of the Moomba-Sydney pipeline.

The Australian industrial community, including not only those who arc the industrialists but also those who are working in the industry and who are dependent on it for their livelihood, has been concerned by the events which have been revealed in the last week or so relating to the construction of what may be described as the initial part of the reticulation of natural gas for Australia which is to be carried out not with pipelines manufactured from Australian steel by Australian industry but with Japanese steel imported by the Australian Gas Light Co. at a cost of about S54m. This, naturally, has caused great concern in industry, to the unions and to the workers who could be affected by the loss of employment in the steel and pipelines industries. This situation has given rise to considerable controversy.

Broken Hill Pty Co. Ltd, which is the main supplier of steel in Australia, Tubemakers of Australia Ltd, which is a company in which BHP has shares, and another company - Steel Mains Pty Ltd - which is in the pipeline industry, have been giving out somewhat publicly, but apparently more privately, versions which are different from that given by the Australian Gas Light Co. on what are supposedly the facts of the matter. It is said by BHP and by Tubemakers that, in effect, they have not had fair treatment in the supply of these materials, that they could have supplied at least part of the pipeline and the steel, that men will lose their employment because of the failure to allow them proper treatment in the tender, and that they could have complied with at least a great deal of the contract if they had duly been given the specifications and the proper opportunity to comply. As I read one report, it is said by a spokesman for BHP that workers in the Australian pipe industry could lose their jobs as a result of the $54m gas pipeline contract given to Japanese manufacturers. That statement was by a Mr John Avieson, who said that industry needed the order to keep going. He said also that no pipe contracts were coming in in Australia and that if they did not get this one they would not get any.

Senator Wright:

– To which employees is the honourable senator referring.

Senator MURPHY:

– Employees in the steel and associated industries. At this stage I am merely putting some of the contentions which have been raised in the matter. I do not want it to be assumed that I am vouching for the accuracy of these contentions; I am merely saying that matters such as these are being raised. On the side of the Australian Gas Light Co. it is being said, as I understand it, that it is nobody else’s business, that it is their own business what they do with the contract. The company maintains that everybody was given a fair chance to tender for the contract and that Australian industry - for the moment do not let us worry about which division of it is involved - is not able to meet the times or the specifications. It says also that Australian industry is not able to give the warranties which would be required, that the safety of the material ought to be subject to an unlimited warranty on the part of those supplying the pipelines but that such a warranty could not be obtained in Australia where there are some limitations on warranty. I understand that the Australian companies are prepared to warrant their products to the extent of $250,000 or $500,000 but no more. On the other hand, the Australian Gas Light Co. is suggesting that the Japanese company is prepared to meet the price and specifications and to give an unlimited warranty.

Workers in the industry are certainly concerned about what has been happening, and with good reason. The National Secretary of the Federated Ironworkers Association of Australia has indicated his union’s extreme concern at the proposal to construct the pipeline with imported materials because the union is heavily involved in the steel and associated industries. Mr Short, the National Secretary, said that his union had hundreds of unemployed members in the Newcastle, Wollongong and Melbourne areas and some of those unem ployed could be absorbed if the pipes were built in Australia, or even if half of them were built in Australia. He said that the National Council of the Association had contacted the Broken Hill Pty Co. Ltd and Tubemakers of Australia Ltd to ascertain whether BHP could produce the special steel, and it has said that it could, and whether Tubemakers of Australia could produce the pipelines, and it had said that it could make 45 per cent of the pipes required in time to meet the plans of the Australian Gas Light Co. and, given more time, it could produce all the pipes.

That concern of the Federated Ironworkers Association is shared by other organisations involved. The Amalgamated Engineering Union, which is now part of Amalgamated Metal Workers Union, earlier made approaches to the companies involved in the matter, including the Australian Gas Light Co., and apparently reached understandings that its position would not be prejudiced. In fact, it has said that it was told that Tubemakers of Australia would be providing as much of the pipes supply as was within its capacity and the remainder would be imported from Japan.

This matter raises some very important considerations for Australia, because it is apparent that we are starting on what will be an important part of the development of our fuel resources and fuel supplies. Natural gas is predicted to supply, in various ways, from 10 per cent up to perhaps 30 or 40 per cent of our fuel needs by the end of the century. The outcome of these predictions will depend on events; but there is little doubt, from the experience in other countries - in particular the. United States, where there is a developing shortage of natural gas, and Japan - that there will be a worldwide demand for natural gas and that, for a number of reasons, Australia will want to develop its utilisation of natural gas. Almost certainly it will embark upon reticulation of natural gas. There will be pipelines joining the major cities with the natural gas supply areas. Those who are expert in this matter predict that we might have at least 10,000 to 12,000 miles of pipeline. So, this 760 to 800 miles of pipeline is the beginning.

At this beginning we are faced with the clear indication of an entire absence of national policy enunciated by the LiberalCountry Party Goverment. That is the basic reason for the difficulty with which those who are interested and the nation are now faced. There is no national policy. There ought to be a national policy. Why ought there to be a national policy? Because all those who have looked at the matter consider that there ought to be. The Senate appointed the Select Committee on Off-shore Petroleum Resources. The report from paragraph 8.54 to the end of the chapter deals in some detail with the viewpoint of those in the industry. My reading of the report is that all of those concerned with this development said that there had to be a national policy, that the Government had to be involved in the question of the transportation of natural gas and that it could not be left to develop as have our railways. We had confusion in the development of our railways and we would have confusion in this industry if each private industry were left to determine what should be done in its particular own interests.

I would like to refer to some of the evidence that is contained in the report of the Senate Select Committee on Off-Shore Petroleum Resources. At paragraph 8.55 Mr Hume, the general manager of the Brisbane Gas Co., said: . . that Australia is leaving herself in a somewhat unique position at this stage in not having a federal authority whereby transmission and distribution can be controlled. Whether you look at the United Kingdom where the gas industry is nationalised, or whether you look at the United States of America or Canada where the industry is under private enterprise, in all cases you will find a Federal or central authority of reference and decision which we in Australia seem to be lacking at this stage. 1 hope that the position does not prove to be as it was in the case of the railways of Australia - we wait for X years hence before we try to untangle the mess that has created by different gauges and so on. 1 believe that does not apply only to natural gas in which my own company is primarily interested. I would support the view that Federal fuel policy is a most desirable thing from Australia’s point of view. If we are to be faced with the problems of interstate transmissions, then undoubtedly, in my mind, chaos will arise eventually. The present situation possibly is simple enough to bc handled by interstate argument and discussion but finally a crisis will occur and I think we should be preparing ourselves to have machinery legislation available to serve it.

Mr Hume went on to expand that point. Mr Pettingell, the General Manager of the

Australian Gas Light Co., submitted a letter to the Committee. In that letter also there are indications of the necessity to avoid bedlam. Mr Pettingell stated:

If the seperate States impose diverging principles of control, the development of interstate transmission lines would be greatly inhibited - that has in mind America and Canada where there was bedlam.

Later in his letter he stated:

Uniform regulations should govern the construction and operation of interstate pipelines throughout the whole length . . : .

He dealt with this question in various ways. He went on to state:

A simple and practical approach’ by the Commonwealth Government to legislation enabling the construction and operation of interstate pipelines could possibly set the pattern for appropriate State legislation dealing with intra-State pipelines and associated matters such as conservation.

The Committee stated:

The evidence would suggest that regulatory and advisory responsibilities of an authority in the field of interstate Trade could include: (1.) To authorise the construction, ownership, operation and location of interstate oil and gas pipelines;

To make orders with respect to all matters relating to traffic, tariffs and prices; and (3.) To study, review and from time to time report to the Parliament on such policies and measures as it considers necessary or advisable in the public interest for the control of transportation of oil and gas.

What is said in the report by the Committee and by those witnesses who appeared before the Committee is unquestionably common sense. It would be difficult to find anyone who could say that in the national interest there ought not to be a Federal authority which regulates and controls this field and which determines what ought to be done as we start to develop this great pipeline system.

Are we really to allow this pipeline system to be developed by the decisions of the Australian Gas Light Co. or of some other company - perhaps those from overseas who are interested in the development of these fields? They will do what seems to be appropriate to them and after we get into a mess with all sorts of lines which will go in directions and for purposes which suit particular private interests, somehow the nation will have to come along and sort it out and do what all the experts have said ought to be done right at the beginning.

It is evident - and this has been pointed out by a number of financial writers and by all those who have examined what the Government is doing - that the Government just has no policy at all. There ought to be a policy. This is the basic question with which we are concerned. We are only getting the edge of the problem here. We consider the mess up that is occurring in the present case involving the importation of pipes for the Australian Gas Light Co., we can see the evidence of the absence of any plan. We are only at the beginning of this enormous Australian industry which will transform the fuel aspect of our economy.

Mr Robert Sorby, writing in the ‘Australian Financial Review’, has drawn attention again and again to the fact that the basic question is the entire absence of Federal Government policy and, for that matter, State government policy, in this field. The Federal Labor Party has enunciated its policy. This policy is set out in its platform. 1 would like to refer to the brief statement that is contained in the platform. It is as follows:

Labor will establish a joint Federal-State fuel and energy commission to devise and implement an integrated and co-ordinated national fuel and energy policy. The Commission will:

Regulate the exploration, development, transportation, marketing and use of oil, natural gas, coal, fissionable materials and generative water and prevent the depletion of fuel and energy resources needed to match Australia’s requirements . . .

That statement also goes on to mention that Labor would guard the environment. Labor’s policy was spelt out in very much more detail by a committee of the Federal Parliamentary Labor Party. May I say that a number of my colleagues in the other place, particularly Mr Rex Connor, were responsible in large measure for the development and drafting of that policy. The policy was then stated in both Houses at great length. I think that I read to the Senate the policy that had been so developed and drafted in 1967 or 1963. Had that policy been acted upon, there would not have been these difficulties.

The real problem is that companies such as the Australian Gas Light Co., Broken Hill Pty Co. Ltd, Tubemakers of Australia, and for that matter the Japanese company as well as the trade unions, do not know what the Federal Government has in mind.

It is a disgrace that not only is there the injury, one might say, to the Australian companies which have their competing allegations in this issue, but one might say that even the Japanese company would have a legitimate grievance if it said: ‘We are not responsible for the lack of policy of the Federal Government. We were asked to tender and we did so. We won the contract. Why should it be interfered with?’ That is a legitimate complaint. The difficulty in Australia - and this is where we need Federal Government policy, and we cannot do without it - is that the Government will not say: ‘We will establish a pipeline commission. Here is our programme - we will do the best we can to work out how these natural resources can be developed and where the pipelines will go. We are running grids to connect up the whole of Australia. These are the reasonable kind of plans, we have to develop them. We will build, say, 2,000 miles of pipeline over 5 years and so many more thousand miles over another few years and we will adapt our plans in the light of any changes in the circumstances. However, we can be quite sure there will be a minimum of pipeline built over a certain period’. If this were done the Australian companies such as Tubemakers and BHP would know where they were going. They would know with certainty what the Government’s plans were and they could put themselves into the position, by acquiring the proper plant and having the appropriate technology and skilled workers, to meet the requirements. If they got themselves into this position by appropriate actions one would say that they would have every expectation that the Government would do the right thing, by the use of appropriate protections and encouragement, to see that the pipeline would be constructed in a way which would use Australian materials wherever that could reasonably be done. This would enhance the interests of Australian industry and employees and there would not be this kind of disruption between ourselves and other trading partners. There would not be complete uncertainty in the industry for companies, trade unions and members of those trade unions.

Senator Wright:

– Does the honourable senator have anything to say on the matter of constitutional power?

Senator MURPHY:

– In relation to constitutional power it is clear that the Commonwealth has power over the interstate trade and commerce. It is clear that the Commonwealth has power over the importation of commodities such as steel, and in co-operation with the States it certainly has power in regard to an institution such as the Australian Gas Light Co. which has special privileges and has virtually a monopoly in regard to the supply of gas for industrial and commercial purposes in New South Wales. The Commonwealth has a corporation power and a whole host of other powers, leaving aside such powers as the defence power. When one is dealing with the prospective energy requirements of a nation, of which natural gas will be a important part, I do not think it is useful to divert this argument into what the constitutional powers may be because this is a subject which is fundamental to this nation. Not only is the supply and movement of natural gas fundamental but also the prosperity of the steel industry and industries associated with it and the livelihood of persons who depend on those industries are fundamental.

I suggest that we must understand how important this industry is to Australia and how important the developments are going to be. We are going to have this important industry. We are at this impasse which seems to have stemmed from the deal which was made between Sir Henry Bolte and the late Mr Holt. At the time the deal was characterised as one made for parochial purposes and aimed at disadvantaging New South Wales. The shortages which are going to concern the world may be understood from the prices which United States interests are prepared to pay. There is discussion which suggests that sums of up to $1 per 1,000 cubic feet will be paid for gas brought in cryogenic tankers. The fields which are of importance are not merely the South Australian fields.

Senator Cotton:

– Cryogenic?

Senator MURPHY:

– That is the word. A science known as cryogenics has developed.

Senator Cotton:

– That process is used in cutting up chickens.

Senator MURPHY:

– And perhaps human beings one day. But at the moment we are speaking about the conveyance of great quantities of natural gas in that convenient form. The Palm Valley field has natural gas far in excess of the South Australian field. The fields off shore from the north west are extremely important. The Palm Valley field is pertinent to this discussion because the construction of the pipeline from Moomba to Sydney brings it within striking distance of the Palm Valley field. What is to be done about this? International interests such as Japanese and United States interests are concerned for their purposes with the exploitation of the Palm Valley field and the off-shore north west fields. Our national interest is concerned. Surely we should have a national approach now and some reasonable planning as to what is to be done. If this pipeline is to be constructed surely there will be a link up with the Palm Valley field? We ought to be making a national plan now in relation to how this interstate transportation of natural gas is to occur. It has been estimated that there . are some 3 trillion cubic feet of natural gas in the Gidgealpa field and some 45. trillion cubic feet in the parts of the north .west shelf which have already been tested. As I understand it that may be only about 10 per cent of the field. This makes it a field of world importance.

It is time the Government faced up to these questions. The great decisions as to what is to happen to this natural gas resource should not be made by the Pacific Lighting Corporation or by Japanese interests. It may be of importance to know in what form payment will be made for the steel. If it comes from Japan is it to be paid for by the export of natural gas to Japan or in some other form? The exploitation of the Palm Valley field is tied up with the transport of the gas. It is said that some $900m may be invested in this by American interests. There are suggestions that some 15 times as much may be recouped by those interests. The particular pipeline with which we are concerned immediately is only a trifle when compared with how these resources are to be dealt with as a whole. Surely the lesson is clear. At this stage we ought to know just what is happening. How does it come about that decisions are being made which adversely affect the steel and pipeline industries? Is it true, as is alleged on one side, that some 300 or 500 men will not gain employment which they otherwise would have gained and the steel and pipeline industries will be severely prejudiced in making plans for their future involvement in the construction of steel or pipelines for future use. Instead of saying - as the Minister for Trade and Industry (Mr Anthony) said yesterday - that this is a matter for commercial firms to sort out between themselves we should say that it is time this was a matter for the nation. We are entitled to know. We ought to be supplied with the information. A national decision should be made on these issues in the context of what is to be done in the development and piping of natural gas in Australia.

Motion (by Senator Wright) proposed:

That the debate be adjourned until 9 p.m. this day.

Senator Murphy:

– If the debate is being adjourned for some special reason - I do not want to argue - may I suggest that as a matter of convenience resumption be at 8 o’clock instead of 9 o’clock? If there is some special reason perhaps the honourable senator could indicate it?

Senator WRIGHT:
Minister for Works · Tasmania · LP

– by leave - I shall indicate the position. This notice was handed to me at about 10.25 this morning and the Senate was to meet at 10:30. This is a subject of national importance which I believe deserves a careful response. I seek merely some time for the preparation of that response.

Senator Murphy:

– Is not 8 p.m. reasonable?

Senator WRIGHT:

– I have proposed 9 p.m. We have Government business to attend to.

Senator Murphy:

– At that commencing time this debate could not conclude tonight. I suggest that the debate should be resumed at 8.45 p.m. and we could then conclude it.

Senator WRIGHT:

– I agree to that proposal. Mr President, I ask for leave to amend my motion so that it will read:

That the debate be adjourned until £.45 p.m. this day.

The ACTING DEPUTY PRESIDENT

Senator Wood:

– Order! Is leave granted? There being no objection, leave is granted.

Senator LAUCKE:
South Australia

-I present an interim report from the Senate Standing Committee on Social Environment on the reference relating to the environmental conditions of Aborigines and Torres Strait Islanders and the preservation of their sacred sites.

Ordered that the report be printed.

Senator LAUCKE:

– 1 ask for leave to move a motion relating to that report.

The ACTING DEPUTY PRESIDENT (Senator Wood) - Order! Is leave granted? There being no objection, leave is granted.

Senator LAUCKE:

– I move:

There are 2 main reasons for the presentation of this brief interim report on the reference relating to the environmental conditions of Aborigines and Torres Strait Islanders and the preservation of their sacred sites. Firstly, recognising the Senate’s expectation that legislative and general purpose standing committees will make regular reports on progress with the particular matters referred to them, the Committee wishes to inform the Senate of the progress made with this inquiry. Secondly, the report gives expression to the Committee’s concern over a particular aspect of the general subject matter, and recommends immediate action thereon. I should like to mention that, in considering this reference, the members of the Committee are addressing themselves to a task in which they must be deeply concerned with social circumstances and human values. For this reason, wide ranging evidence and deep consideration will be required for the building up of the complete picture in respect of environmental conditions and the preservation of sacred sites. A great deal of firsthand observation will be essential also, and the Committee has already undertaken 3 field trips to remote parts of the continent. Further field trips will be made as the inquiry progresses, and these will survey the whole range of situations from the remote and primitive to the urban and metropolitan. By direct invitation as well as by public advertisement in the Press throughout Australia, submissions have been sought from interested persons and organisations, and the general response has been highly gratifying. More than 30 witnesses have been heard. A great many more are available and will be examined in due course. All these factors are reasons why the Committee believes that the inquiry will be a fairly protracted one.

I now turn to the particular matter about which the Committee expresses concern - the preservation of sacred objects and sites. May I explain here that the Committee has extended its consideration of sacred sites to include objects also, as the information put before us indicates that many objects of sacred and cultural significance are integral to Aboriginal traditions. In the course of the Committee’s field trips, the members examined sites of significance to Aborigines and, by invitation of the particular Aboriginal groups, collections of objects of sacred and cultural significance. Our own observations, and information put before us, led quickly to the conclusion that 2 sites are vulnerable to interference and damage, and several collections of objects are liable to damage or loss. After taking some evidence on the question, the Committee has concluded that special interim measures .are needed to provide the maximum of protection immediately, and for the next 2 years until, according to our advice, reasonably adequate legislative protection . will exist throughout Australia. Though we have not attempted to canvass the whole of this issue, we have recommended action in relation to objects and sites generally where these may appear ot be vulnerable, as well as in respect of the specific examples that we ourselves have seen.

In proposing that action be taken on this aspect of the general subject matter, the Committee wishes to emphasise the need to consult the Aborigines concerned in each instance and to encourage them to seek action for the protection of their objects and sites. The Committee recommends that lockable structures be provided for the safe keeping of the vulnerable collections of objects specifically discussed and, wherever possible, for the safe keeping of other collections in similar conditions of jeopardy wherever they are known to exist or come to notice in the future. We propose also that the Office of Aboriginal Affairs assist, through appropriate funding arrangements, in making available the necessary finance. We recommend special action for the immediate protection of known sites that seem most likely to suffer damage. As an essential preliminary to permanent action, we recommend that a national programme for the surveying and recording of sites of significance be expedited. Again, we believe that the Commonwealth has a responsibility for the provision of some of the requisite funds, and the Committee recommends that the Office of Aboriginal Affairs play an active role in these 2 proposals.

Senator KEEFFE:
Queensland

– I wish to emphasise what the Chairman of the Senate Standing Committee on Social Environment has said in the presentation of this report. In particular I refer to recommendation 2 on page 13 of the report in which the Committee recomends

That in the meantime special consideration be given to known sites which seem most likely to suffer damage, wilh a view to providing immediate protection on some temporary basis. 1 fear that if we await legislation from the various areas concerned and if immediate action is not taken, sacred relics may bc lost to the Aboriginal people and to Australians for all time. 1 strongly support the remarks made by the Chairman of the Committee and 1 trust that the Commonwealth Office of Aboriginal Affairs and the Minister in charge of Aboriginal affairs at the Commonwealth level will take the appropriate action. I ask for leave to continue my remarks at a later stage.

Leave granted; debate adjourned.

page 1216

QUESTION

PLACING OF BUSINESS

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

– I move:

I move this motion for 3 reasons. Firstly, the Government has given an undertaking to debate Senator Murphy’s urgency motion at a later hour today. Secondly, if we had got the urgency motion out of the way, the Senate would normally have gone down the business list to reach Order of the Day No. 1 which is the debate on the first reading of the Income Tax Bill 1972. During the course of that debate some senators took the opportunity to raise the matter of Jetair Australia Ltd. Some honourable senators who are yet to speak may raise the question of Jetair Australia Ltd and the papers connected with that company which have just been tabled by the Minister for Works (Senator Wright). The third reason for the motion is that the Aged Persons Homes Bill, which is Order of the Day No. 5, must come into operation by the 10th October. If we do not deal with it in the order I propose and the Senate goes into recess next week, honourable senators will not have sufficient time to debate it.

Question resolved in the affirmative.

page 1216

QUESTION

OVERSEAS INVESTMENT IN AUSTRALIA

Ministerial Statement

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

– by leave - The statement I am about to read was delivered in the House of Representatives yesterday by the Prime Minister (Mr McMahon). Where the first personal pronoun appears it refers to the Prime Minister.

Last May, the Treasurer (Mr Snedden) tabled in this House a Treasury economic paper entitled ‘Overseas Investment in Australia’. In doing so, he identified 3 problems associated with overseas investment. They were the high level of capital inflow and the potential problem that creates for managing the domestic economy; the suggestions of exchange rate speculation to which such inflows give rise, and the possible consequences of that; and the sheer growth of foreign ownership and control of important elements of our economy. Since May this year, the Government has been conducting a review in depth of our policy towards overseas investment. We were aided in this by the public debate which the Treasury economic paper generated.

Today I want to announce the government’s decisions to date arising out of that review. Before doing so, however, I wish to make clear the Government’s view of the past and future role of overseas capital. Overseas capital has played a vital role in Australia’s development. It has added considerably to the resources available for our growth. It has brought with it valuable technological know-how and access to overseas markets; it has created new industries. Australia is a larger nation, and a more prosperous one, as a result. The inflow of capital has been associated with increasing overseas ownership and control of industry in Australia. This has been one cost of the increased growth which has come from welcoming overseas capital. In the past, this has been a cost which, in our judgment, has been outweighed by the benefits. Nonetheless, our policy has been to encourage overseas capital to come insofar as practicable on a joint basis - and in close co-operation with Australian-owned enterprises. But circumstances change and so must policies.

In the past 2 years, capital inflow has increased dramatically. In 1969-70, net apparent capital inflow was $797m. In 1970-71 it was $l,418m. Last year, it was $l,841m. A very high level of capital inflow seems in prospect again this year. Until 2 years ago, capital inflow, by and large, was broadly matching our deficit on the current account of the balance of payments. That is, the overseas capital was being used to add to the resources available in the economy. Without it we could not have sustained a large net inflow of goods and services from the rest of the world. That situation has now changed. In 1970-71 net apparent capital inflow exceeded the current account deficit by $598m. In 1971-72, the excess rose to $ 1,443m. Between end- June 1970 and endJune 1972 official reserve assets rose from $l,538m to $3,764m They now exceed $4, 100m.

In brief, in the past 2 years, capital inflow has resulted chiefly in a build-up of international reserves rather than an addition to resources actually being used in the economy. The greater part of this recently increased inflow has been in respect of company borrowings. Exchange control approvals of gross borrowings abroad rose from $568m in 1969-70 to $ 1,222m in 1970-71 and to $l,681m in 1971-72. With the existing unimpeded access to overseas lenders, our ability to use monetary policy effectively has been called into question. The House may recall that the Treasury economic paper said that ‘private capital flows have now acquired a practical potential to nullify the effects of monetary policy on internal economic conditions.’ To date this has not happened. But the buildup in liquidity which is proceeding will, if allowed to go unchecked, produce some headaches for the future.

As a separate but related matter, the Government has also been considering the growth of overseas ownership and control of Australian industry. We need to be sensible about this. We all want to see a bigger Australia. We all want the tangible benefits that access to overseas capital and skills brings us. Yet there is legitimate cause for concern. The right balance between our desire for an Australian Australia and for greater growth and prosperity must be struck. After 20 years of vigorous growth we are today a relatively wealthy nation. We have less need to depend on overseas capital for our growth today than we did some years ago. We can afford now to trade off, at the margin, some of the benefits of overseas capital for a greater Australian share in our industry and resources. We can do it, too, without frightening off overseas capital. Overseas investors are expecting us to move. In brief, the policies which have served us well in the past now need modifying.

I turn now to the 4 specific decisions we have taken as a result of our review to date. Three relate to the problem of net capital inflow and the fourth to the problem of overseas control of our industry. I begin with the first of the 4 decisions, that is:

Exchange Control on Short-Term Borrowings Overseas

The largest part of net capital inflow is accounted for by borrowings overseas by Australian residents, including foreign companies resident in Australia. We have decided to act to diminish the level of short term borrowings. The Reserve Bank will, from tomorrow - today - refuse exchange control approval for all overseas borrowings which would be repayable, or carry options to repay, in 2 years or less. Loan agreements which have already received exchange control approval will not be affected.

With a view to rendering the proposed measure effective, the present sterling area exemption, under which, inter alia, borrowings in Australian dollars from sterling area residents are not subject to exchange control approval, will be terminated forthwith. For the sake of administrative simplicity, at any rate in the early stages of the scheme, borrowings totalling less than $100,000 in any one year will be exempt. The appropriateness of this exemption limit will be reviewed from time to time. I come now to the second decision which concerns:

The Borrowing Guidelines

Since May 1965, the government has laid down certain guidelines which have limited the freedom of overseas-owned companies to borrow in Australia. One effect of the guidelines has been to require overseas-owned companies to bring in funds from overseas in place of the funds which they have not been permitted to borrow locally. This effect was appropriate to the circumstances formerly prevailing, but the circumstances have changed. The need now is to limit overseas borrowings, not to encourage them. Accordingly, the Government proposes to abolish the guidelines forthwith.

The third decision deals with:

Portfolio Investment Overseas by Australian Residents

At present, portfolio investment abroad by Australian residents is not permitted. Our decision is to relax this policy while retaining the need for exchange control approval of such transactions. Details will be announced shortly by the Governor of the Reserve Bank. The effect of these decisions will be to moderate the level of net capital inflow from overseas. They may, as a result, have some effect on the Australian capital market and will, incidentally, restore to Australian financial institutions some of the business which, in recent times, has been going abroad. I want to emphasise that developments in our own market will be watched very carefully to ensure that there are no untoward consequences. With liquidity presently at a high level, no transitional difficulties are foreseen.

Mr Acting Deputy President, at this point I turn to the question of overseas ownership and control. In this area of policy, the Government has long made it plain that the most welcome overseas capital is that employed in partnership with Australian-owned capital. However, the trend towards increasing overseas ownership has gone on. The time has come to consider more direct action to influence that trend. Our balance of payments on current account has improved greatly and, with that, our need for overseas capital has lessened. Our own Australian industry is more advanced and technologically capable than 10 or 20 years ago and can, if given the chance, effectively partner overseas companies. Action in the field of foreign ownership and control generally raises complex problems. We have undertaken an initial study of these problems; but their resolution will require more detailed study and further time for careful consideration. That work is now in hand. Its results will be announced as soon as practicable. However, in respect of one particular form of overseas ownership and control, we have decided that action can be taken without awaiting the final outcome of that full review.

I refer to the subject of our fourth decision:

Foreign Takeovers

No aspect of overseas investment has excited more attention than this question. Foreign takeovers result in control as well as ownership passing from Australian to foreign hands. This aspect causes particular disquiet. Sometimes foreign takeovers also have the objective, or at any rate the effect, of limiting competition. In such cases, disquite is justifiably intensified. On the other- hand, foreign takeovers can revive an ailing company or may be made at a price permitting the Australian recipients to reinvest the proceeds at a considerably increased return. Australian as well as overseas investors have rights at stake and our policy must be such that their interest is not prejudiced - except when the interest of the nation requires it. The Government’s longstanding policy has been that it reserves the right to do. all in its power, to prevent a particular takeover when, in the circumstances of the case, it is considered by the government to be against the national interest. Moreover, under the policy announced on 24th May last by the Attorney-General on restrictive trade practices and monopolisation, takeovers which are likely to limit competition will be subject to examination and report by the monopolies commission which is to be established. This applies whether the bidding company be foreign or Australian.

We think, however, that the time has now come to introduce a new approach for the control for foreign takeovers. The Government intends to legislate for the prevention of foreign takeovers it considers would be against the national interest on the basis of criteria which I shall indicate. The legislation will apply to acquisitions of shares or other assets by overseas interests which might reasonably be expected to result in control of an Australian business passing to overseas interests. In the case of company takeovers, there will be a presumption that - acquisition by any one overseas interest or associated group of 15 per cent or more - or by overseas interests in the aggregate of 40 per cent or more, of the voting power of an Australian company - could constitute a takeover. For this purpose, overseas interest will include an Australian - incorported company in which any one overseas interest or group holds 15 per cent or more of the voting power - or in which overseas interests have in the aggregate 40 per cent or more of the voting power. Cases where control of a business would pass into overseas hands through acquisition of all, or a substantial part, of the assets of the business will also be subject to the measures.

The measures may also apply to the transfer of a significant part of the ownership or rights over a valuable or potentially valuable mineral area, such as can occur through transactions known in the mining industry as ‘farm-ins’. If overseas interests demonstrate that an acquisition would not give a significant degree of foreign control, the measures will not apply. They will also not apply if the takeover would simply transfer control from one overseas interest or group to another. The measures will, in general, apply to cases where the company concerned, whether listed or unlisted, has assets of more than Sim. Australian governments have already taken action to restrict foreign investment in certain industries of national significance - notably banking, airlines and radio and television broadcasting. Cases may arise where an Australian company involved in a takeover proposal is considered by the Government to be an economically strategic industry leader or to be so large that the takeovers would significantly affect the relative balance of Australian-overseas ownership and control of the industry concerned. The proposed legislation will include a power, in those circumstances, for the Government to take direct action to prevent the takeover if it judges such action appropriate.

Foreign takeover proposals judged by the Government to warrant detailed investigation as to whether they would be against the national interest will be referred to an independent authority - including official Government representation - which will analyse each such proposal and report on it to the Government. Decisions of individual cases will be taken - I stress this - by the Government, after consideration of the independent authority’s report. There will be a time limit of one month, measured from the date of notification of a takeover to the Government, or the date of the making of a public announcement concerning the takeover, for reference of takeover proposals by the Government to the independent authority. Proposals not referred in that time will be free to proceed. There will be a further time limit of 3 months maximum from the date of reference for report by the authority, unless extended by the Government in special circumstances.

For the purpose of references to and reports by the independent authority, the first criterion to be applied in judging whether a proposed foreign takeover would be against the national interest will be: Whether, against the background of existing circumstances in the industry concerned, the takeover would lead, either directly or indirectly, to net economic benefits in relation to such matters as production, prices, quality and range of products and services, efficiency and technological change which would be sufficient to justify the increased degree of foreign control of the particular industry that would result from the takeover.

If the proposed takeover is judged to be not against the national interest on this basis, the following additional criteria will also be taken into account: Whether, after the takeover, the firm concerned could be expected to follow practices consistent with Australia’s interest in matters such a3 exports, imports, local processing of materials produced, research and development and industrial relations, including employee protection; and whether the takeover would have adverse consequences in terms of the Government’s objectives for defence, environmental protection or regional development.

In making judgments as to whether particular foreign takeovers would be against the national interest on any of the foregoing grounds, due weight will be given to: The extent of Australian participation in ownership and management that would remain after the takeover; and the interests of shareholders of the company subject to the takeover and the attitude of its board of directors. Pending the enactment of legislation and establishment of the independent authority to be provided for in it, the measures I have outlined for the control of foreign takeovers will be brought into immediate effect on an interim basis. Under the interim arrangements departmental machinery will be used in place of the independent authority and on the basis of application of the criteria I have indicated. These measures will apply from tomorrow and will embrace foreign takeover proposals already current.

The decisions I have announced are firm and positive: They have not been taken lightly. Australia has benefited greatly from overseas capital in the past and we continue to welcome it on fair and reasonable terms. The steps we are taking are designed to deal with some of our main concerns. We believe they do so fairly and judiciously. As I have said, we aim to see greater Australian participation in overseasowned companies. In addition to the steps I have announced, the Government is examining further means of giving effect to that aim. In the meantime, however, we make it clear that our concern is to see that overseas capital is employed in Australia in real partnership with Australian owned capital. I commend the proposals to the Senate and move:

That the Senate take note of the statement.

Sitting suspended from 12.53 to 2.15 p.m.

Senator Murphy - Mr President, prior to the suspension of the sittings for lunch the Acting Leader of the Government in the Senate, the Minister for Air (Senator Drake-Brockman), had made a statement on behalf of the Prime Minister (Mr McMahon) on overseas investment in Australia. During the luncheon adjournment I had the opportunity of discussing with the Acting Leader of the Government the course which should be taken. It has been agreed between us that in view of the great importance of the subject matter there should be a full debate on the issue and that it would be convenient to delay the debate some little time in order to enable all honourable senators to prepare themselves. Therefore I will not address myself to the matter at this stage. As the Senate will not be sitting next week we have in mind holding the debate on Wednesday of the following week. Therefore I ask for leave to continue my remarks.

The PRESIDENT:

- Senator Townley, you are sitting in the Independent’s corner. Do you acknowledge some agreement to this course being followed?

Senator Townley:

– I do.

The PRESIDENT:

– I put the question that Senator Murphy be given leave to continue his remarks.

Leave granted; debate adjourned.

page 1220

AGED PERSONS HOMES BILL 1972

Second Reading

Debate resumed from 19 September (vide page 918), on motion by Senator Greenwood:

That the Bill be now read a second time.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– This Bill stems from the Government’s budgetary proposals relating generally to nursing homes, to home nursing, aged persons homes and aged persons hostels. According to the Budget proposals, the total cost of the proposals mentioned in the Budget Speech of the Treasurer (Mr Snedden) is estimated to be $1 6.9m for the rest of this financial year and $43 .9m in a full year. Last week the Senate passed a Bill relating to this Bill, namely, the Aged Persons Hostels Bill. It was estimated that expenditure under the Aged Persons Hostels Bill could exceed $5m in the first full year of operation but, because it is considered that an initial period is necessary for planning projects and for calling tenders, expenditure this financial year is not expected to exceed $2m.

The Aged Persons Homes Bill which is now before us provides for an increase in the rate of personal care subsidy payable under the Aged Persons Homes Act. The Bill provides for the rate to be increased from $5 to $10 a week and that rate applies to each resident aged 80 years and over who is residing in an approved hostel. Under this Bill the personal care services must be provided for any aged resident in need of such services whether or not that resident has attained 80 years of age. The Attorney-General (Senator Greenwood) said during the course of his second reading speech when presenting this Bill that the present subsidy of $5 is now paid to 360 homes which cater for about 16,000 aged persons. Of those residents almost 7,000 are aged 80 years or over. The Minister said that expenditure on the subsidy currently is running at the rate of $2m a year and that doubling of the payment from $3 to $10 a week will cost an extra SI. 3m for the rest of this financial year and approximately $2m in the first full year. I rather suspect, Mr President, that that figure is in the nature of an estimate because it results from a mere doubling of the sum presently paid for those who are 80 years of age and over. Surely the personal care services to be provided for any aged resident in need of them, whether that person has attained 80 years of age or not must be taken into consideration also in estimating what the cost is likely to be.

Relating this Bill to the Aged Persons Hostels Bill which was dealt with last week, 1 was very interested to compare the second reading speech of the Minister for Social Services (Mr Wentworth) when presenting the Aged Persons Hostels Bill in the other place with the second reading speech on that Bill made in this place. I say that because the Minister for Social

Services, in the course of his second reading speech on the Aged Persons Hostels Bill in the other place, said:

However, because an initial period is necessary for planning projects and calling for tenders, expenditure is not expected to exceed $2m in 1972-73, but it is my sincere hope-

I emphasise these words to indicate that they were not included in the second reading speech of the Attorney-General in this chamber - that these estimates will prove to be over conservative.

It is very significant to me that that last phrase was omitted from the AttorneyGeneral’s speech when moving the second reading of the Aged Persons Hostels Bill in the Senate. Apparently the Government now has made up its mind that this will be the amount. When the Bill was in the other place the Minister virtually said that he did not know the estimate of cost or that he did not know that the estimate of cost given was an accurate one. Indeed the estimate proposed for all these measures is more in the nature of a ‘guesstimate’ than a reasonable estimate.

I wish specifically to deal with this Aged Persons Homes Bill. Naturally one assumes that during this session a Bill will be introduced to amend the National Health Act in order to provide for the new arrangements for patients requiring home nursing care which are to take effect from 1st January of next year and the domiciliary care benefits which will commence from 1st March 1973. It appears to me that a great deal of this legislation could be incorporated within one type of legislation. The number of legislative measures relating to these aspects of health and welfare are creating great confusion in the minds of the people. People are confused about their entitlements. There is the home nursing legislation, which comes within the purview of the Commonwealth Department of Health, and the Aged Persons Homes Act and the Aged Persons Hostels Act, all of which are inter-related, the latter 2 not coming within the purview of the Commonwealth Department of Health but within the ambit of the Department of Social Services. It is high time that the Government gave consideration to this aspect wilh a view to seeing whether an effective consolidation of these pieces of legislation can be brought about.

Because the Aged Persons Homes Act will come into force on the first day after the Bill receives the royal assent, which I should think would be in the very near future, and having regard also to the fact that the Minister has said that departmental surveys show that many aged people who have no real need for medical supervision have been admitted to nursing homes - the reliable estimate that he cited during his second reading speech on the legislation was 25 per cent or about 12,000 - it seems to me that the Government should have introduced the amendments to the National Health Act before this legislation was introduced in order to make effective its policy on home nursing care. But for some reason which is beyond my comprehension the Government decided not to do that. I should have thought that the proposed amendments to the National Health Act in relation to home nursing care and domiciliary services should have been presented to the Parliament before this legislation. Certainly one can expect that when those amendments are introduced many people who now occupy places in aged persons homes might be able to return to their own home or to some other suitable place and that the procedure involved under that legislation should enable costs to be reduced and ensure that the elderly citizens of this country have the best of care in an environment to which they have been accustomed or which is more suitable for their needs and requirements.

Last week when the Aged Persons Hostels Bill was before the Senate the Democratic Labor Party said something about the differential in rates in the various States. I think Senator Gair was probably directing his attention to the home nursing legislation which is to be enacted under the National Health Act. The proposed rate of benefit will be the same in New South Wales, Queensland and Tasmania, namely, $10.50 a week; in Western Australia it will be $11.20 a week; in South Australia it will be $14 a week; and for Victoria it will be $22.40 a week - more than a 100 per cent increase on the rate of benefit to apply in New South Wales, Queensland and Tasmania and exactly 100 per cent more than the rate to apply in Western Australia. If I may mention these matters in relation to the Aged Persons Homes Bill, with which they are very much interrelated, I do not regard that sort of differential between the States as in any way satisfactory from a national point of view. I believe that an inquiry should be conducted by the Commonwealth Department of Social Services or the Commonwealth Department of Health into the reasons for the vast differential in the charges in the various States.

Perhaps the Minister could say in bis reply, if he chooses to do so, whether the charges are related to the law of supply and demand applying to the availability of beds in the various States. In other words, does it mean that some States are building more nursing homes for the people who need them than are other States where this area of activity has been left more to private enterprise? The States Grants (Nursing Homes) Act was passed by the Commonwealth Parliament during 1969 for the purpose of providing financial assistance to the States towards the erection of additional State-run nursing homes and extensions to existing homes. Commonwealth grants under the States Grants (Nursing Homes) Act are limited to $5m on a $1 for $1 basis and were made available for a period of 5 years. Whilst it might be pleaded by the Minister that this is not directly connected with this legislation, nonetheless I am sure he will agree that the matters are very much interwoven.

Senator Greenwood:

– They are certainly interwoven. Unfortunately the Department of Health is responsible for nursing homes and the Department of Social Services is responsible for this measure. It is one of the practical problems in responding as much as I would have liked.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– I come back to my earlier point. Because of the difficulty brought about by variations between the Department of Health and the Department of Social Services, I think the time is long overdue when the Government should consider how the various measures relating to the welfare of Australia’s elderly citizens can be consolidated.

Senator Greenwood:

– These pieces of legislation are a very marked breakthrough. That is the important thing about them.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– I agree that they are a breakthrough, but I am not saying that they go far enough. I sat as a member of the Senate Select Committee on Medical and Hospital Costs and I agree that this legislation is a breakthrough. However, because of the diversity of areas that are involved, people become confused as to whom they should approach and what their entitlements are under this great multiplicity of legislation. As I was saying, I had the honour with my colleagues Senator Mulvihill and Senator Fitzgerald on this side of the chamber to be a member of the Wedgwood Senate Committee which inquired into medical and hospital costs.

Senator Sim:

– Senator Dittmer was another member.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– Senator Dittmer, and Senator Sim, also were members of that Committee, which tendered its report to the Senate in June 1970. In dealing with this type of matter the Committee reported at page 57 of its report:

The Committee, whilst appreciating that it has been said that this is only the commencement of the scheme, believes that much more Commonwealth involvement and initiative is required. The Committee believes that a far greater number of homes are required in a relatively short period of time, and, in order that the criticisms concerning quantum of charges be kept in proper perspective, considers that these homes should be erected by the State authorities and be managed or be controlled in management by the States.

Whereas in the hospital field the States have taken responsibility for provision of services they have, as a general rule, left the development of nursing homes to private and religious bodies. Because of the relationship between hospitals and nursing homes, as mentioned in subsequent paragraphs, it appears to the Committee that it is unfortunate that the States have not undertaken extensive development of nursing homes. For this purpose and as a means of overcoming shortages of bed availability and possibly the stabilising of charges the Committee proposes that following a survey of needs the Commonwealth should make unmatched grants to the States while the need exists.

The table set out in paragraph 192 above shows the availability of approved nursing home beds, the difference in States between public and private ownership and how the States generally have maintained hospital services but not nursing homes. It is interesting to note that those States with higher hospital bed-population ratio generally have a higher ratio of nursing home beds to population.

The Committee of Inquiry into Health Insurance, known as the Nimmo Committee, had something to say on this subject at page 57 of its report which was presented in March 1969. For the sake of the record I will read out paragraphs 15.10 to 15.15: 15.10 The Commonwealth has recently introduced a higher scale of benefits for patients requiring intensive care. 15.11 This new benefit of $5 a day should greatly assist patients who are eligible for it. and at the same time, allow them to receive a better standard of care, provided the proprietors of the homes do not increase their charges so as to absorb the benefits, without improving the standard of care. Patients who require only light care are not eligible for the new benefit and their financial problems remain for them to resolve as best they can. 15.12 It was repeatedly stated in evidence before the Committee that the standard of accommodation and care in nursing homes varies greatly. It was stated that in some homes the accommodation is of the highest order and programmes of geriatric and rehabilitative treatment have been developed. In others, however, it was said that the accommodation is poor, the food unattractive and monotonous, the treatment almost solely confined to the administration of drugs and a large proportion of the patients becomes prematurely moribund and remains bedridden until the end. 15.13 Although the standard of accommodation and care provided by nursing homes may not come directly within our terms of reference we feel it incumbent on us to stress the urgent need for the Commonwealth Government and the State Governments to jointly investigate all aspects of nursing home services with a view to joint remedial action where necessary. 15.14 The need for Commonwealth-State cooperation in a simple matter of terminology was mentioned to us many times during the inquiry. It was stated that the dissatisfaction felt by insured persons who were accommodated in nursing homes, but received no fund benefits, was aggravated by reason of their nursing homes being registered under State laws as ‘hospitals’. Because they were so designated, the insured persons believed that hospital benefits should have been available to help meet the accommodation charges. Whatever inquiries amd discussions are necessary before other nursing home problems are dealt with, there seems no reason why steps cannot be taken immediately to end the confusion and misunderstandings which occur because the expression ‘hospital’ means one thing to Commonwealth authorities and health insurance organisations, and something different to some Slate authorities. 15.15 We recommend:

that the Commonwealth and the States jointly investigate all problems associated with nursing homes with a view to joint remedial action where necessary;
that the States be requested to prohibit the inclusion of the word ‘hospital’ in the name of nursing homes and other institutions which are not eligible for hospital insurance benefits.

I deliberately read those paragraphs into the record to indicate that the Nimmo Committee had something to say on this matter in March 1969 and the Wedgwood Committee had something to say on this and related matters in June 1970; yet it has taken the Government this length of time to get around to doing something to ameliorate the problems of the elderly citizens of oar community.

However, I agree that what is being done is a breakthrough. The Opposition believes that the steps that are being taken now, oe the eve of a Federal election, are ones that should have been taken many years ago. Naturally, the Opposition does not oppose this legislation at all. Like the Government it is anxious to secure the early passage of this legislation because it is more than time something was done to ameliorate the shocking state of geriatric services in this country. 1 trust that in the future consideration will be given by the Government to co-operating with local government organisations on a regional basis to tackle this problem thoroughly, effectively and on a planned basis. But, for the time being, because this legislation is a step towards achieving planning to meet the geriatric requirements of this nation, the Opposition does not oppose the Bill; indeed, it supports its speedy passage.

Senator GUILFOYLE:
Victoria

– The Aged Persons Homes Bill is very simple in its form. Its purpose is simply to double from $5 to $10 the .personal care subsidy which is granted to persons aged 80 years and over who are in aged persons homes. Senator Douglas McClelland pointed to the complexity of the legislation that covers services to aged and ill people. In that regard I make the comment that in my State of Victoria we have a very desirable feature in the citizens advice service which is provided at the local government level and is very helpful to the people throughout the community who benefit from the many areas of assistance under Commonwealth, State and local government programmes. The availability of some trained social worker assistance at the local government level to provide information on the services available is almost a necessity because of the very many areas in which assistance can be given.

With reference to the Bill now before the Senate, in view of some of the comments that have been made perhaps it would be wise for me to trace the developments under the Aged Persons Homes Act since it was instituted in 1954. At that stage it was instituted to assist eligible organisations on a non-profit basis. To religious and community service organisations that were willing to establish homes, the Government provided this new programme of assistance. In 1957 the original $1 for $1 subsidy was increased to a $2 for $1 subsidy. In 1966 this capital subsidy became available also for nursing home beds not exceeding one-half of the total number of residential beds provided by an institution. In 1967 local government bodies were included as organisations eligible under the terms of the Act. In 1969 there was a further amendment which provided a personal care subsidy of $5 a week for persons of 80 years of age or over who received approved personal care while living in hostel-type accommodation. The Bill now before the Senate doubles that $5 a week personal care subsidy.

This year it was a stated objective of the Budget to improve the care and services available to aged persons in aged persons homes, in particular those in nursing homes. In order to encourage the provision of the type of home provided under the Aged Persons Homes Act, we have already passed through both Houses of this Parliament the Aged Persons Hostels Bill. Although there was no debate on that Bill in this chamber, I think it is reasonable to recount the fact that under it there will be an opportunity to treble the amount of accommodation that is available in the States of Australia through the availability now of a grant of $7,800 per bed and an additional $250 per single unit for furnishing requirements. This is an extreme measure to assist the provision and development of accommodation for aged persons in the type of facility that is necessary for their comfort and care.

The doubling of the personal care subsidy is part of the implementation of the new 3-year programme to provide a stimulus to the provision of accommodation for aged persons. The SIO per week which will now be paid will be of great assistance to the institutions which provide the necessary care for these people. It is an incentive for institutions to allocate their bed space to the upper age group - that is, those over 80 years of age - where personal care is essential for them at a time when it is needed for many of the disabilities which they suffer. Most residents of non-profit hostel type homes will soon be receiving a pension of S20 a week plus S4 a week in supplementary assistance.

In addition under this Bill the home will receive $10 per week for those over 80 years of age. I understand that approximately 45 per cent of the residents of these institutions fall into this upper age group. Therefore, if we average the subsidy which will be payable to those institutions we shall find that approximately $4.50 will be paid to residents in these homes. I have seen figures which estimate that the running costs per resident of these homes is about $22 a week. It will be seen that as a result of the pension rate, the increased supplementary assistance and the fact that $10 will be paid directly to the home or the institution, some margin should be left to a pensioner resident for personal expenses. This, again, is a desirable feature as we have found for pensioner patients in nursing home institutions.

In the financial year 1972-73 the subsidy of $10 per patient will total approximately $3.2m. The amount will be more than $4m in a full year. These figures perhaps in themselves do not sound to be large ones in the total complexity of the social welfare section of the Budget. However, under this Bill, the assistance is directed to one sector of our aged community.

I would like to draw attention to the fact that the grants which have been made under the Aged Persons Homes Act to date total over $150m and that as a result of this assistance accommodation has been provided for many thousands of our aged community. Some 45,000 aged persons have been housed as a result of the Aged

Persons Homes Act. Some 20,000 aged persons live in self-contained units, some 17,000 in hostel type accommodation and 5,000 in nursing home accommodation.

The grants which were made during 1971-72 reached the record level of $23. 8m. The amount in respect of the accommodation approved in each of these 3 categories exceeds previous records under this Act. The homes which were established under the Aged Persons Homes Act accommodate only a portion of the aged community of Australia. And it should be recounted that over 60 per cent of age pensioners own their own homes and that many others are housed by their families. It is estimated that some 50,000 aged persons could be living in unsatisfactory accommodation - unsatisfactory because it may be at a rental which is too high for their pension to sustain or because the accommodation is of a level which we feel does not give them the comfort that they require. Therefore, with this in mind the new provisions under the Aged Persons (Hostels) Act should be of great assistance to those organisations which have already provided some measure of hostel accommodation and which will now have the government capital subsidy to enable them to provide many more of these homes in what we hope will be a crash programme over a 3-year period.

The fact that this Bill has the support of all parties is a desirable feature to recall. It should also be recalled that this legislation is part of a very big programme by this Government to assist the aged and infirm in our community. We hope that the provision of the extra $5 per resident per week will enable those institutions to provide comfort, care and service to the aged in the community. We hope that the running costs which they are sustaining will be greatly assisted by this new subsidy. I feel that the desirable feature about this legislation which has been added is the fact that some personal income may be retained by a pensioner patient who is resident in one of these homes. I commend this Bill to the Senate.

Senator LITTLE:
Victoria

– I wish to speak very briefly on the Bill. I do not wish to recount the statistics that have already been given. What has been said of the purposes of the Bill fits in with the general philosophy of the Australian Democratic Labor Party to which I belong. It is a step, as has been suggested by the Opposition, that perhaps may be overdue. That is a matter of opinion. The problem of looking after aged people has been a growing one for a considerable period of time. Probably the advance of medicine and many other of the related sciences has enabled us to prolong life beyond the point which was once known or expected. I believe that increased expectancy of life has caught modern day communities in general, and not necessarily in Australia alone, a long way behind in the provision of the sort of facilities which will prove the quality of life of this age group. This is particularly so because these people have reached the age at which they cannot depend on income from their own earnings but are dependent upon social services which are their right. We have found that there has been a general inability, particularly where ill health intervenes to cope with the problem of the magnitude that it has become because of the increasing numbers of people who now survive through to this age group. Therefore, rather than apportioning blame we prefer to suggest that, although it is high time that something was done, it is encouraging to see that we are stepping forward as a community to provide an improved quality of life for the people who come within this category and that we are doing this at the very essential levels of human life as we know it - that is to provide decent standards of homes and accommodation for them.

The Australian Democratic Labor Party has been known for one thing, if for no other: We have taken it to ourselves to fight for the establishment of a better quality of life, not from the cradle to the grave, but even before the cradle, to protect those who are not at that point of time able to protect themselves. In an age when there has been much thinking about the obvious problems, we feel that there are many things that the community ought to guarantee to society but which have been overlooked. Indeed, the stresses of public propaganda are being placed in areas which we feel will not improve the quality of life for anybody, and certainly not for everybody. Some of the easy and slick solutions to what may appear to be growing problem very often can create so much unhappiness, mental strain and terror that in themselves they are not cures at all but begin something that is far, far worse.

The legislation before us is in a step in the right direction. We applaud it for what it is. We indicate our wholehearted support for this measure. However, we do not feel that by any means it is the end of the road. As long as mankind is able to lift his standards, improve his knowledge and increase his efficiency we will never reach the end of the road. I believe that we are doing something that has never been done before in the history of man. I believe that the vision splendid that lies before us can be enormous as we gradually correlate all our forces to head in the one direction. This is a non-political matter and we would not engage in any way in making politics out of it. Any government which brings forward a step which is in the right direction gets praise and wholehearted support from the Australian Democratic Labor Party. My Party and I support the legislation.

Senator MULVIHILL:
New South Wales

– I merely enter the debate to endorse the sentiments expounded by my colleague, Senator Douglas McClelland. Like all other honourable senators who have spoken, I welcome any legislation that can make easier the way in which Australians live a long and fruitful life. As a by-product of medical science life is prolonged and an intensification of services is needed. There might be argument as to the responsibility of the Department of Social Services and the Department of Health as is borne out by the dialogue which ensued between Senator Douglas McClelland and the Attorney-General (Senator Greenwood). That is my opening observation.

If one studies the second reading speech of the Attorney-General who in this chamber represents the Acting Minister for Health (Dr Forbes) and if one looks at the terms of the Bill one sees the recurring phrases ‘the Director-General shall’ or ‘the Director-General will’. This prompts me to ask the Minister, who under the existing machinery is responsible for a multitude of health problems, whether the DirectorGeneral can be as mobile and available as to provide these added services. In a comparison between the European concept of the nation and health and the United States concept I lean to the European and British set-up. I do not deny that in medicine and hospitals the patient-doctor relationship is very difficult. I digress for a moment to point out to people who bleat about how much more can be done by the children of aged persons - I am indebted to Dr Klugman, a learned medico in the other place - that since 1955 family contributions to national health has virtually trebled. In fact, they increased from 1.58 per cent in 1965 to 3.52 per cent of the minimum wage in 1971 so the State must bear a major responsibility for the housing of the aged. The point 1 make in this direction is that 1 remain a little sceptical. If we consolidate some of the functions of the Department of Social Services with others which are the responsibility of the Department of Health and place them under the supervision of a health insurance commission as proposed by the Nimmo report I think we would be dealing with the matter in a much more effective fashion.

Many of us know what happens when we vent a complaint to the Minister for Health (Senator Sir Kenneth Anderson). 1 know the Director-General and his officers. We have seen them before Estimates Committees. We know their diligence but they are only human beings and their work load can only reach a certain point. I am sorry that the Assistant Minister assisting the Minister for Health, Senator Marriott, is not here. He knows of matters which have been ventilated in other fields and the time it takes to obtain answers. I am not cavilling - we ultimately obtain one. In fact, there is a legend - it may not be a legend - that when Senator Greenwood was Minister for Health he was signing 6,000 to 8,000 letters a week. I do not know whether that was so.

Senator Greenwood:

– 1 would love it to be true.

Senator MULVIHILL:

– That is probably like a lot of these legends. But this does not alter the fact of the Attorney-General’s work load or that of any other Minister. I question part of the Attorney-General’s second reading speech which states:

To qualify for the subsidy a home must provide meals and employ sufficient staff. . . . 1 do not know but I imagine thai there will be spot checks on the services rendered. I know full well that when people get over the age of 75 they can be difficult. They can be subject to hallucinations. We all know this. But this does not alter the fact of the proprietary complex. This is bad enough in relation to the private hospital sector today when directors of boards overrule what the matron often believes is the decent thing to do. I say this quite respectfully. Supervision has to remain in relation to these homes for the aged whether they be under denominational control or under the control of some middle group. These standards or services have to be checked. While we are on the subject and talking about the complexities of the various departments there is an important matter which we must not overlook. We all know that when aged people are in nursing homes and we talk about Government subsidies the real nub of the issue is that there can be a considerable chemists’ bill which is met by people other than the pensioner. Honourable senators might argue and say that millions of dollars are spent either on nursing homes or on aged persons homes. I believe that if we are to work in tandem there is no valid reason why the Taxation Commissioner should not rule that chemists’ bills paid by the sons and daughters of aged people are a suitable item for deduction. There has been a lot of talk in this place about taxation reform. This is one thing into which we do not need an inquiry. This expenditure would not be a debit to social service costs and health services. But this is a vital auxiliary to what we are talking about now.

I return to this matter of supervision. I have some strong feelings about a paragraph in the Minister’s second reading speech which states:

In addition a staff member must be on hand at all times in case of emergency.

I qualify these remarks by saying that one cannot get away from the dedication of the bulk of the staff. But what I hope will be avoided is the no man’s land where there may be a senior wardsman who has some inner frustration because he is not a Doctor Kildare. The result is that if the opportunity arises he tries to make an onthespot diagnosis. This can be very stupid.

I know of one incident when this happened; I was a witness to it. I hope that under any supervision which goes on - it does not matter who controls the hospital - we will have a far greater frequency of on-the-spot investigations. I do not necessarily blame the matrons at all. But at a time when the general practitioner is squealing to high heaven about doctors not being fully utilised if we are giving subsidies as a natural corollary it is time that the Minister had talks with the Australian Medical Association. The other night on television I saw a doctor who said that it was a luxury not to be called out at night. Doctors are not the only ones who are called out at night. Plenty of people in other fields such as loco enginemen, fire brigade employees and policemen are called out in the middle of the night. Plenty of parliamentarians, too, are out late at night. With all due respect to what is in the Bill I sincerely hope that the AMA will be told that it has a responsibility. In this community, whether you be a parliamentarian or a medico, no-one has a god-like profile. All are subject to supervision. Like all other speakers I know that this Bill has a lot to commend it. But we are a little apprehensive about the machinery of the Department. Is it in a position to check on any blurred spots to see that justice is done? We all know that the field of health services is expanding. A long while ago when Senator Greenwood was Minister for Health or even in the time of his predecessor I suggested that if we did not want to follow completely the Nimmo recommendations then we should look at the position in central Europe, in Belgium and Holland. Somewhere between the board of a hospital or a nursing home and the people there should be participation by the relatives of the inmates. I am not getting onto the worker-management concept but in Belgium there are many checks and balances whereby the bureaucrats and the hospital board are not able to dazzle people with their silence. Having said this and expressed reservations I know, with Senator Douglas McClelland, that we want to accelerate the legislation - mindful, however, that there is always something better to achieve in the distant future.

Senator DAVIDSON:
South Australia

– 1 indicate my support for this Aged

Persons Homes Bill as it processes an aspect of the Budget Speech which evokes a response in every one of us in terms of its attractiveness and also because of its extension of the Government’s welfare and social service programme. In the first instance I refer to an extract from the speech of the Treasurer (Mr Snedden) in which he stated:

We will also double the present rate of subsidy to eligible organisations providing personal care services for the aged in hostel accommodation. The new rate will be $10 per week for each occupant aged 80 years or more.

The purpose of this Bill is to put this indication into effect. It will provide a much needed service for those people who are unable to fend for themselves as well as they did once.

I take up the reference which Senator Mulvihill made in passing. He said that he thought the Minister in charge of the Bill at some other stage signed so many thousands of letters in a week and that to do so would probably be physically impossible. A point of interest is that that reference indicates something of the extent to which Government departments, and Ministers in particular, are involved in the total social wellbeing of our Australian community, especially that section of the Australian community which is either aged or unwell.

In speaking in support of this measure today I draw attention to the fact that the government of the day, whatever political colour it may be, has become more and more involved in the social welfare programme of the Australian community. The Australian community is called to recognise this fact, not only for any elements of generosity which may be expressed in legislation but also through the interdependency between the Government and its departments, on the one hand, and the community on the other hand.

When the Minister was speaking in relation to this Bill, he pointed out that the doubling of the rate of personal care subsidy together with the implementation of a special 3-year crash programme would stimulate the provision of more of what we now call hostel type accommodation. He expressed the hope that this action would correct the pressing shortage of suitable accommodation for those aged persons in our community who may be described also as the frail aged.

Every time a measure relating to the welfare of our senior citizens is introduced and implemented,I think it is important to recall very briefly something of the background from which this general programme came. In 1954, when the Aged Persons Homes Act was introduced, the Commonwealth began subsidising those organisations of homes for aged persons. Most of them were non-profit community organisations and many of them were religious or church organisations. As honourable senators will recall, the original subsidy was on a$1 for$1 basis which later,I think in 1957, became a $2 for $1 basis.

A number of types of accommodation were described as being eligible to attract subsidies. Some of these were the selfcontained units in which people of senior years were able to live independent lives. Then there was also included the hostel type accommodation - a phrase whichI must confess I do not like butI have been unable to devise a better or more attractive form of words - where people had their own rooms but took part in the meals and other services which were provided within the home itself. Of course, another type of accommodation was the very necessary nursing home. The Senate would be interested to have written into the record that grants made under the Aged Persons Homes Act to date have totalled $150m. Accommodation under this scheme has been provided for not fewer than 45,000 aged persons.

Looking at these figures, I think it is important that they be divided into selfcontained units which cater for some 23,000 people, the hostel type accommodation which provides for some 17,000 people and nursing home accommodation which covers some 5,000 people. In the current year, grants have reached the record level of over $23m. The amount of accommodation exceeds all of the previous records. I think it would be true to say, and indeed it is pertinent to affirm, that this surely indicates the success of this wide-ranging and far-reaching social welfare scheme. For example, the records of the Department of Social Services show that over 500,000 or some 62 per cent of Australia’s 834,000 aged pensioners own their own homes, while State housing authorities and unsubsidised hostels provide for at least a further 25,000 people. The provisions of the present Bill which springs from the background of the references I have just made in my view represent a significant step forward.

I wish to refer to those people and organisations who have established home:, for senior citizens and who, in the course of their many, varied and distinguished services, have provided what we have come to describe now as the personal care service. These organisations have been suffering from acute problems in relation to the balancing of their budgets. Increased demands have been made upon them and costs have increased in the maintenance not only of services but also of properties. These organisations have had to deal, as you are very well aware, Mr Deputy President, with a whole range of difficulties arising from increased salaries, increased wages and increased cost accounts.

It should be firmly recorded in the Senate this afternoon that these organisations have kept their standards very high. They certainly have not cut any of their services, thanks to the very many splendid people, who I suppose can all be grouped together under the description of voluntary workers. Those people who have organised nonprofit institutions or church homes, be what they may, have ensured, indeed have insisted, that the establishments in which they have been interested and for which they have provided these services have been maintained as homes. I use the word homes’ advisedly and contrast it with the word ‘institutions’. These establishments have been made homes and not institutions.

Let us all pay very generous praise particularly to the committees, the office bearers, the chairmen and secretaries of the various auxiliaries, and to other voluntary workers and supporters. In addition to raising money and giving personal service, these people have devoted much skill and a great deal of time. I have knowledge, and I am sure honourable senators have knowledge of many instances of personal and financial generosity in maintaining the homes, preserving goodwill for the residents and maintaining the standard and quality of life that aged persons have enjoyed in these homes.

The subsidy, which is the main purpose of (he Bill, was introduced first in 1969. It has had the effect of enabling many homes and establishments to extent their services to what have been known as personal care services. I think some 16,000 people have been receiving this service in about 360 homes which have been allotted the subsidy. Honourable senators will recall that the Bill refers specifically to those who are over 80 years of age. Of the number of people involved in this scheme some 7,000 people are over 80 years of age. From my various general inquiries I have discovered that the trend of this percentage seems to be consistent throughout the country. Estimates from Adelaide, through which I have had some discussion on the matter, indicate that rate of nearly 50 per cent of people of 80 years of age and over receiving this care seems to be reflecting the general trend.

It has been pointed out to me also that this trend towards 50 per cent and over is increasing. I imagine that we are entering into a period when the number of people who are over 80 years of age will be increasing. AH of this, of course, reflects the increased and improved social welfare and medical programmes which have been initiated and sustained as part of the Government’s total social welfare programme. A point of view that has been expressed to me ls that perhaps the age of 80 years might ‘be reconsidered with a view to reducing the qualification to 75 years. Having said that, I know that one immediately raises a whole range of other related matters, not the least of which is the economics of the situation but, as we move and research into new ways of providing improved social welfare programmes, that proposal merits real consideration. After all, the very purpose and the core of this subsidy as contained in the Bill is the wellbeing of our senior citizens.

New researches and new methods are constantly required if our aged persons and our senior people are to live lives that are satisfying and provide for them the opportunity of maintaining their place in our total society. The Bill which is before us this afternoon will enable these homes to which I have referred, and to which other honourable senators have referred, to balance their budgets and to provide ade quate care in what I call the immediate field, that is, between the independent units on the one hand, and the nursing home style accommodation on the other. It is in this intermediate area that the personal care subsidy, which is the core of the Bill, enables nursing care and related assistance to be extended to people who need them. We should not overlook the fact that flowing from this kind of programme are various rehabilitation programmes and supportive services as well as occupational therapy. The community at large must always preserve a proper relationship towards its senior citizens; care, attention and respect are essential. But we should also always recognise that our senior citizens are people of experience, achievement and maturity and we should regard them as such.

It is easy enough to. stand in this place, as senators do, to support improvements, growth and extensions in the social welfare programme. However, we should always examine and re-examine our total approach to social welfare programmes. We must constantly re-examine our ideas, beliefs, attitudes, opinions and judgments. We must remember that the Australian community is one community within the whole range of world communities which are giving a great deal of care and expert attention to social welfare. Therefore we must constantly seek to avail ourselves of the information and knowledge which is accessible to us as we develop our own social welfare programmes. If we are to make a worthwhile contribution to social welfare we must recognise that our contribution may demand more from us as citizens of the country than perhaps we have hitherto realised. A great deal of development in social welfare has evolved over the last 20 to 30 years. In the late 1920s this definition of social welfare was given at a conference: ‘Alleviating suffering arising from poverty, preventing social ills, improving social conditions and raising the standards of living.’ That is an easy phrase to repeat because it has universal agreement. Nevertheless, I do not think that it is quite so easy today to define social services. Min is by nature a social creature and he is mure and more dependent on other people for the answers to his most basic needs. I nave heard social welfare described also as ‘the organised social methods of meeting basic human needs for mutual support’.

In the late 1920s social welfare definitions were simpler than they are today. We are. I think, being forced to recognise that today social welfare involves much more than materia] aid for those who happen to be in need, whether in terms of age or health. Preventive and constructive assistance are inadequate ideas, if I may put it that way, because they imply in my view a kind of reaching down and raising up image which belongs to what 1 will describe as outmoded social attitudes. Today social welfare is concerned with the quality of life of all human beings but more particularly, as we discuss a particular age group today, those of senior years Therefore as we debate and agree on social welfare programmes, the kind of which we have before us today, I think we ought to pause a moment to re-examine our total outlook to them.

The size of the social welfare programme in Australia is enormous, and une does not quarrel with that. But we need to be reminded, I think, of what is contained in the first paragraph of the annual report for 1971-72 of the Department of Social Services:

The Commonwealth Department of Social Services was making direct and regular payments of $3,140,000 at 30th June of this year which was an increase of some 3 per cent on last year’s total.

It may well be asserted that the social welfare programme of the 1970s is very large and that it is a highly professional industry. I am not sure that ‘industry’ is the most suitable word to use about a social welfare programme, but we must remember that involved in a total social welfare programme are doctors, teachers, nurses and social workers all of whom are dedicated to their own particular vocations and to the extra services which they render to mankind. Some welfare establishments such as the wide range of homes and hospitals which are referred to either directly or by inference in the Bill which is now before the Senate, are in themselves large scale industries in which a wide range and a large number of people have a particular and direct interest. Of course, I do not say that as any form of criticism, but I think we ought to recognise it as a fact. Further, as the Minister for Social Services (Mr Wentworth) puts down line by line all the new social welfare programmes we should remember that he is referring to a wide range of skilled professional people all of whom have professional competence and who make an important contribution to the total programme.

While recognising the great skills and competence which they possess we must remember that if their work is to provide the maximum benefit to the social welfare programme it must be undergirded by the involvement of the community at large - because, as I said earlier, this social welfare programme is one in which one section of a community is dependent upon another. It is easy for us to pass a Bill and to make congratulatory references this afternoon about the extra sums of money which are involved, and which the Parliament has directed should be involved, and which the taxpayers provide; but at th- same time we should remember that any constructive welfare programme must be undergirded by the interested, involved and dedicated service of the people at large. If it is not, then all the money and all the expertise which the Government and the Minister’s Department have employed will not bring the maximum benefits which we think they should. With those observations I support the measure and hope that it will have a speedy passage through this House and that those who will be the beneficiaries of it will be able to extend their services in the welfare of the community.

Senator LAWRIE:
QUEENSLAND · CP; NCP from May 1975

– 1 too support this Bill and commend it to the Senate. It is part of the social services programme embraced by the Budget and it is part of a new deal in social services which will lead to the abolition of the means test in the not too distant future, it is a simple Bill of 4 clauses which, as the Treasurer (Mr Snedden) said in his Budget Speech, provides that the personal care subsidy for aged persons will be doubled, lt is as simple as that, though many other points were mentioned by honourable senators who spoke earlier in this debate. The Government wants to pass this Bill as soon as possible because, as the Bill itself states, it will come into effect as soon as it receives royal assent. The increases it provides will be paid almost immediately if it has a speedy passage through the Senate. I have noted that this Bill was not even debated in the other place; the Minister made his second reading speech and it went straight through.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– I think you will find that the 2 Bills were taken together and that debate on them took place simultaneously.

Senator LAWRIE:
QUEENSLAND · CP; NCP from May 1975

– That may be so. As a result of our way of life people have achieved a greater average life span and there is a greater percentage of elderly people in our community. Therefore the community at large has an even greater requirement to care for the aged. This is a problem of our civilisation and of our way of life; we simply have to provide care for a greater number of aged people. Elderly people feel lonely. Then there is the problem that many elderly people feel unwanted; they believe that nobody cares about them. I know that this is a sincere and genuine feeling and that in many cases it is very difficult to overcome. There is the problem of loss of freedom of people in homes or institutions and there is the problem of providing homes or institutions close to the usual place of living of the persons in those homes or institutions. If an elderly person is taken right away to another part of the State in which he lives, he is right out of his environment and his relatives and friends are unable to visit him. This has a disastrous effect on many old people. But if we can provide some form of accommodation for or some way of looking after these people in their own home areas so that their friends can visit them, this has a very great psychological effect on them in their old age.

The Attorney-General (Senator Greenwood) in his second reading speech said:

I am sure all honourable senators will agree that these people, by their past contribution to the development of this country, have earned the special considerations provided in the Budget.

The doubling of the rate of personal care subsidy together with the implementation of a special 3-year crash programme to stimulate the provision of more hostel-type accommodation should correct a pressing shortage of suitable accommodation to the frail aged.

Later in his speech he said:

To qualify for the subsidy a home must provide meals and employ sufficient staff to help any residents who need assistance with bathing and dressing, room cleaning, personal laundry and the general oversight of their medication. In addition a staff member must be on hand at all times in case of emergency.

As 1 think Senator Davidson has already mentioned, the people who provide this type of service for the aged must be dedicated people and they are to be commended for their work. I have always advocated that social service help for the aged should be increased during each 5-yearly period over the age of 65 years because as people get older they become less able to fend for themselves and need more and more help. In this Bill we are establishing to some extent, the principle, by providing this additional service for those over 80 years of age. It is another example of the humanitarian legislation introduced by the present Government to help our elderly citizens. I support the Bill and commend it to the Senate.

Senator GREENWOOD:
VictoriaAttorneyGeneral · LP

– in reply - I thank the Senate for the universal approbation which it has given to this measure. We heard Senator Douglas McClelland and Senator Mulvihill from the Opposition expressing their support for the measure. They raised matters, by way of qualification and reservation, to which they feel the Minister for Social Services (Mr Wentworth) should give his attention, and I am sure that the Minister will give his attention to them. I think Senator Douglas McClelland raised the point whether the expression by the Minister in his second reading speech in the other place, that the expenditure which was estimated was possibly over-conservative, is a reference not so much to the doubling of the personal care subsidy which is embodied in this measure as to the expenditure which is envisaged under the extension of the aged persons homes scheme. After all, when we recognise that this Bill doubles the personal care subsidy, one can reasonably estimate - one hopes with some degree of certainty - what the extra cost will be. Yet, on the other hand, when one considers other aspects of the Government’s programme, such as how many aged persons homes would take advantage of the increased subsidy, there must be some uncertainty with regard to that question. We heard Senator Little on behalf of the Australian Democratic Labor Party indicate that this type of measure is in accordance with the policy and ideals which his Party supports. From the Government ranks we heard Senators Guilfoyle, Davidson and Little, all of whom were constructive in their approach, although essentially expository of the general line which the Government is taking with regard to the social service programme.

This Bill specifically doubles the personal care subsidy. It makes provision which will enable or induce organisations conducting hostels for the aged to provide personal care services for residents whose only infirmity is the frailty of advancing years. As people advance in years and frailty imposes its own burden and sickness its own disabilities, it is a question of how society can provide for these people. Unquestionably and desirably it would be an ideal society if the children and relatives of elderly people could care for them in their homes and accept the responsibility of providing for them in the way in which, say, parents provide for their children as they are being nurtured, but it is not always possible. There are problems of accommodation and there are problems of the other burdens and the need to take employment. There is the fact that many elderly people have not children and relatives upon whom they can rely. Therefore, other provision must be made, for a variety of reasons.

Elderly people can be looked after in their homes or in some form of hostel or unit in which essentially they can look after themselves; but they can have provision made in those cases where necessity requires it and where they are unable to fend for themselves. The third area of accommodation is in the nursing home where there is need for constant attention of a nursing character. Fourthly, there are hostels for those who really need them. We have evolved in this country over the years a system which I think is satisfying and is worthy of acclaim, whereby we have hospital treatment and hospitals which can provide services for those who need them. We also have nursing homes, and in those nursing homes we have a number of beds which far exceeds proportionately the nursing home beds which are to be found in other countries. Indeed, there is the problem in Australia that maybe the conditions under which nursing homes can be established have been so good and so many nursing home beds have been established that people who do not require nursing treatment have found their way into nursing homes. For the want of some other place to go, they have found their way into nursing homes and they have been provided with nursing attention. Possibly they are excluding someone else who should be in a nursing home from being there. Additionally, this is imposing a cost on the community because very substantial benefits are paid by the Commonwealth for those persons who receive nursing home treatment.

I recall from the short time when I was Minister for Health reading estimates which suggested that approximately 25 per cent of persons currently in nursing homes do not really require nursing home treatment. What is really required for these persons are units and hostels of the type which are provided by aged persons homes. Whilst we have had a scheme which has been in operation now for some 2 to 3 years, which provides a personal care subsidy to organisations in respect of persons over 80 years of age, still there is a need for further assistance and that is what this Budget and this particular measure provide. We have doubled the persona] care subsidy. We have made it possible for people to receive all the necessary personal care services even though they are not now 80 years of age.

We also have provided for the aged persons homes scheme to be expanded so that there can be an increase in the number of homes. We feel that together - and this is a matter of co-operation between the Department of Health and the Department of Social Services - we can facilitate the availability of aged persons hostels and provide inducements under which persons will establish this type of hostel. We are doing this by the personal care subsidy. I have said before, and I say again in conclusion, that what the Government has provided in this Budget, in terms of positive, advancing social service benefits, is without parallel in Australia’s history, and we trust that taken together the measures will make a reality of the social security which we all wish to see and which we all believe this nation must provide. I commend the Bill to the Senate and thank the Senate for its ready adoption of the legislation.

Question resolved in the affirmative.

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

page 1234

INCOME TAX BILL 1972

First Reading

Debate resumed from 20 September (vide page 1077), on motion by Senator Cotton:

That the Bill be now read a first time.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– When this debate was adjourned last Wednesday night I was about to deal with the documents on the question of Jetair Australia Ltd that Senator Wright had tabled on that day as a result of Senator Turnbull having raised the subject during the first reading debate of this Bill. When the Minister for Works (Senator Wright) replied at a later hour of the day he tabled a number of documents setting out the Government’s position in relation to Jetair. Today other documents have been tabled and I understand that later in this session a full scale debate will be waged on the subject. So at this stage for the purpose of this discussion I cut my remarks on that subject to a minimum. To say the least - I am only going on the documents that were tendered by the Minister for Works last Wednesday, not having had the benefit of seeing those that were tabled-

Senator Greenwood:

– Under the Standing Orders, Senator Wright tabled only those documents that he quoted from last week. Today there has been a full scale tabling.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– I am just saying that I am going on the documents that he tabled last week and not on the documents that he tabled this week. Frankly, I hoped last week he would table all the documents at that stage so that we would have been given an opportunity to look at them then in view of the chronology of the events that took place arising from Senator Turnbull’s remarks. Speaking about the documents that Senator Wright tabled last Wednesday - not the documents he tabled today - it would appear from my reading of them that to say the least they clearly indicate that the then Minister for Foreign Affairs gave his approval to the transaction from wrong - indeed, incredibly wrong - information supplied to him by his

Department. The ministerial statement made by the Minister for Works causes me further concern on the subject. But again I say that that is a matter for another debate at another time.

The matter that I wish to raise during the first reading of the income Tax Bill 1972 is in relation to a question that I directed to Senator Cotton on 18th May 1972. It concerned the situation of the textile industry in Australia. On 18th May, during the last sessional period. I asked the Minister representing the Minister for Trade and Industry:

Is the Minister aware that Courtaulds (Austra’ia) Ltd, which is situated in the Port Stephens Shire of New South Wales and which is one of the largest decentralised industries in N:w South Wales, employed 1,500 persons 5 years ago but now employs only a little over 800, the number of workers having been reduced by about 300 in the past 9 months-

That is, the 9 months preceding last May - . . due to reduced production following increased imports of competing products of manmade fibres from Asian countries? …. Is the Minister aware that great concern is felt about the future of the Australian textile industry by both management and textile : unions? Will the Government, declare whether the industry is to be allowed to develop or is to be stultified by uncontrolled floods of imports from low wage countries

The Minister, Senator Cotton, replied to my question without notice, which appears on page 1783 of Hansard. He said:

I know the Courtaulds factory at Tomago, lt has been going for quit- a long time. My recollection is that it was established towards the end of World War II as an Austraiian enterprise to produce fabric for the motor tyre industry, plus other things. Those who have followed its career as a decentralised industry would agree, I think, that it has had a long period of ups and downs. I know it has been a problem for the people who were in charge of it. The general pan of the question -

This is the particular matter that I wish to raise at this stage -

. relating lo the whole Australian textile industry is under review by the: Government. It is a long question and I think it ought to be looked at by the Department and a fully prepared answer should be given.

That was on 18th May. On 1st June, immediately after that sessional period had concluded for the winter recess, I wrote to the Minister for Trade and Industry (Mr Anthony) drawing his attention to my question directed to Senator Cotton on 18th May and to Senator Cotton’s reply.

In addition. 1 attached to my letter a copy of my question and a copy of Senator Cotton’s answer. I said in my letter of 1st June: . . You will know that amongst other things Senator Cotton said ‘lt is a long question and I think it ought lo be looked at by thz Department and :i fully prepared answer should be given’.

J drew the matter to the attention of the Minister for Trade and Industry in the hope that the Department would be able to furnish me with some detailed information on the subject. I received no reply to thai letter. So on 16th August 1972 - 2i months after I had written my first letter and nearly 3 months after I had asked the question - I again reminded the Minister for Trade and Industry. I wrote:

I refer lo my letter of 1st June drawing your attention to a question that I directed on 18th May. . . .

J further said:

As 1 have not as yet received a r-ply to my letter. I would appreciate your advising me whether your Department is now able to furnish me with detailed information on the subject.

That was on 16th August 1972; today is 27th September 1972. I have not even received a formal acknowledgment of that letter. I can tell the Minister for Civil Aviation (Senator Cotton), and I would request him to convey this to the Minister for Trade and Industry, that it is a pretty sad state of affairs that this should happen when a question is asked in the Senate, when the Minister sitting at the table says he will refer it to the Department. I, taking out a double indemnity policy, as it were, wrote to the Minister on 1st June. Receiving no acknowledgment 1 wrote again on 16th August, and again received no acknowledgment. If this is the manner in which the Government is treating not only the problems of the workers, who are very concerned about retrenchments in the textile industry and the build-up of unemployment in the industry, but also the problems of management, it is a pretty poor state of affairs.

I plead with the Minister for Civil Aviation to take this matter up with his colleague in another place and draw his attention not only to the protracted delay but also the complete ignoring of the matter after it had been raised in this chamber and on 2 occasions by me by way of correspondence. The situation I outlined applies not only to Courtaulds (Australia) Ltd on the north coast of New South Wales but to the textile industry generally. I know that officials of the Australian Textile Workers Union and of the Clothing and Allied Trades Union of Australia are very concerned about the large number of importations coming to Australia that are competing with products produced and manufactured in this country. The imports are creating substantial unemployment. At least the Government has the responsibility of stating where it stands so that the management and the workers involved in the industry will know what their future is.

I now wish to raise a matter which I seem to raise annually, if not more frequently. I refer to the great difficulties being encountered by Australian artists and Australian entertainers in securing the right to work, let alone work, in their own country. I believe that the Government has to give very careful consideration to the situation affecting the great number of people who are being deprived of the opportunity to display, exhibit and portray their skills and talents - their undoubted skills and talents - to the Australian community. Not so long ago Senator Hannan raised by way of a question in this place the proposal of the Australian Broadcasting Commission to cease programming the Australian children’s television programme Adventure Island’ at the end of this year. I raised that matter also in the course of the debate relating to the education of isolated children that took place recently.

I have received a large number of letters from people in many areas of Australia suggesting that this programme should be kept on the air, not only because it is an Australian programme but also because it is a high quality one and, probably more importantly, because it is a high quality Australian children’s television programme which informs children, educates them, entertains them and imparts to them some knowledge of their own country. A great number of the people who wrote to me pointed out that throughout many of the imported children’s programmes there is a predominant theme of violence, vengeance, American flag waving, the portrayal of American attitudes, American values and American solutions. They said that Adventure Island’ gave a very refreshing Australian point of view which educated, informed and entertained Australian children.

I hope that not only I but all members of this Parliament will plead with the Australian Broadcasting Commission to review the decision to remove this programme from the air. Again I emphasise that I make that plea nol only because it is an Australian programme. I am one of those people who do not want merely quantity in terms of Australian programmes; 1 also want Australian programmes of quality It seems strange to me that this programme which attracts a large viewing audience has to be taken off the air while its counterpart, for want of a better term, ‘Sesame Street’ - I think it is an American or Canadian production - is retained. If that sort of thing continues to take place there is no hope for children’s programmes on Australian television. After all is said and done, the Australian Broadcasting Control Board was so concerned about the dearth of decent children’s television programmes in this country that it appointed a children’s programming advisory board. I do not know the outcome of that board’s recommendations but I know that it sat for at least 2 years to consider the problem. I hope that this matter relating to children’s television programmes will receive attention.

Yesterday the annual report for 1971-72 of the Australian Broadcasting Commission was tendered. 1 noticed at page 7 of that report a reference to this aspect of Australian content. The Board said:

In some departments, such as drama, science programmes and education, the ABC has now developed skills and talents to a level where significant and high-quality programmes could be produced in greater quantity. However, unless more money is made available for the development and exploitation of these resources of expertise and experience, they will be largely wasted. Deterioration in the quantity and quality of Australian programmes because of a continued lack of adequate funds for programme development would be unfortunate.

If lack of adequate funds for programme development is the determining factor causing the ABC to remove ‘Adventure Island’ from its children’s television programming, I hope that it will consider removing some of the foreign stuff in order to continue this programme. Indeed, I go further and say that the Government should consider increasing the subvention to the ABC to enable it to expand sufficiently.

I now wish to refer briefly to the recent report of the Australian Broadcasting Control Board to show how opportunities for professional variety entertainers have been greatly restricted and impeded. If one peruses the graph on pages 98 and 99 of the Australian Broadcasting Control Board’s report one finds that the number of viewing hours of Australian drama on commercial television stations has increased from 35.7 hours in 1964 - that was about the time of the presentation of the Vincent Committee’s report - to 215.6 hours in 1972. That is a substantial and very welcome increase. I do not say for one moment that all the Australian dramatic programmes presented are of high quality but at least an opportunity has been given to Australians working in this area of drama to display and to exploit, for want of a better term, their skills and talents. I hope that gradually as this opportunity is given to them to develop their skills and talents not only will the quantity increase but also the quality. I am very confident that the quality will improve. Undoubtedly these people have enormous skills and talents. Those in authority are responsible for developing a somewhat similar skill in our producers and directors. Our writers and our actors are first class; it is the production and direction side of our programmes that needs assistance.

In 1964 there were 173.4 hours devoted to professional variety programmes on commercial television, but in 1972 - 8 years later - the number of hours of variety had been reduced to 92.4, which was a drop of nearly 50 per cent when there should have been an increase. On 12th September the Minister for Immigration (Dr Forbes) supplied me with an answer to a question about the number of applications that had been received by the Department of Immigration for working permits to be issued to foreign entertainers to perform in Australia in each of the last 3 years and as to the number that had been approved. The information supplied by the Minister was staggering. From 1st October 1969 to 30th September 1970 - a period of 12 months - the number of work permits issued to foreign entertainers amounted to 525; from 1st October 1970 to 30th September 1971 there were 516 work permits issued to foreign entertainers; and from 1st

October 1971 to 12th September, the date the question was answered, there had been 592 work permits issued to foreign entertainers lo perform in Australia.

So in addition to a reduction in the number of hours of variety programmes from 173 in 1964 to 92 in 1972, in the last 3-year period Australian entertainers have had to compete with 1,600 foreign entertainers who have come to Australia merely to entertain Australians. Yet the vast bulk of those who come in are nowhere near as good as the Australian entertainers. 1 believe that the Government should be taking action to protect the skills and talents of Australian entertainers and should be giving them an opportunity to exhibit their talents for the benefit of Australia, both here and overseas. If the same percentage of Australian entertainers were given work permits to go to the United States, calculated on the American population and on a pro rata basis 16,000 Australians would have work permits issued to them to enable them to work in that country. Calculated on the population of the United Kingdom, on a pro rata basis 7,500 Australians would be able to work in the United Kingdom each year.

I appeal to the Government not only to take steps to see what can be done to increase opportunities for Australian performers in professional variety on commercial television programmes but also to tighten up considerably the number of foreign work permits issued to entertainers to come to Australia. I wanted to make those remarks at this stage rather than speak in the debate on the adjournment as I believe they are matters of great importance to Australia if we are to have an awareness of our history, our heritage and our future. The Government should be taking action to ensure that such a policy is implemented.

Senator HANNAN:
Victoria

– 1 shall not detain the Senate for more than 30 seconds. Senator Douglas McClelland and I have many disagreements on many political matters, but there are areas of agreement between us. One is the necessity for governmental encouragement to achieve an increase in the Australian content of our cinema and television material. I should like to point out one of the problems concerned with the programme ‘Adventure Island’. It is sad to see that this outstanding programme is to be scrapped by the end of the year. I cannot understand it. I have seen no valid reason advanced as to why it should be scrapped. One of the difficulties that the honourable senator will appreciate and which 1 appreciate is that in the area of programming we must steadfastly refuse to put any pressure on the Australian Broadcasting Commission. lt must remain an independent programming authority. That does not mean that by debate and rational argument we may not possibly suggest to the Commissioners that a decision be reviewed, but from a political point of view it is quite impossible to put pressure on the ABC and say that it shall telecast this programme or it shall not telecast another programme. I have risen merely to draw attention to this and to point out to Senator Douglas McClelland that, in the words of the King of Siam, it is a puzzlement.

Senator COTTON:
New South WalesMinister for Civil Aviation · LP

– lt seems a long while ago that I rose briefly to speak in the debate on the first reading of this Bill and was requested to accede to the wishes of a number of honourable senators to speak on a fairly broad range of subjects. They certainly have done that. I think that on the last occasion I was speaking I was endeavouring to have a discussion with Senator Wilkinson on the pronunciation of ‘Khmer’. I think I covered the points that I needed to make on that.

Senator Wilkinson:

– It was long ago; it was this morning.

Senator COTTON:

– I thought so. I think the honourable senator and I should either undertake an education programme or seek leave and be paid to go over there again to refresh our minds. Before I move on to some areas which have been raised I should mention that there was one matter to which Senator Turnbull adverted in regard to Jetair Australia Ltd and the Department of Civil Aviation. I thought it would be appropriate if I cleared up that matter now. Contrary to what Senator Turnbull said, at no stage was Jetair Australia Ltd granted an airline licence. The carriage by the company of fare paying passengers between fixed terminals and the publication of timetables by the company were authorised in accordance with Air

Navigation Regulation 203. Under this regulation the holder of a charter licence may be permitted to engage in this carriage without the necessity of obtaining an airline licence. Operators holding exemptions of this nature are known as commuter operators.

Jetair Australia Ltd was granted a charter licence on 9th September 1969 and an exemption under Air Navigation Regulation 203 was granted on 17th December 1969. At the time of the issue of the exemption to the company some 40 such exemptions had been issued to charter operators in Australia. A prime objective in the authorisation of commuter services is the provision of regular air services between centres not served by the major airlines or from which airlines have withdrawn at their own initiative. The Department of Civil Aviation did not believe that the operations proposed by Jetair Australia would be profitable and we so advised the company both orally and in writing. A specific advice to the company contained in the letter forwarding the regulation 203 exemption stated quite clearly:

During the course of several discussions on the subject of your application for the MelbourneSwan Hill route you were advised that it was the view of the departmental officers that the operation had little if any chance of economic success. The decision to go ahead with the operation is one for your directors and it must be on the clear understanding that there is no prospect of the Commonwealth subsidy being available to support the service in the event thai final results fall short of your estimates.

I was kept fully informed throughout all this process and 1 agreed with the issue of a regulation 203 notice as I would have done with previous operators or other operators who sought to supply a service that was no longer in existence. But in no way was the granting of the exemption inconsistent with the principles of the 2- airline system, nor has it been in any other case. The maintenance of the 2-airline system is firm Government policy, as outlined in our statement to the Senate on 29th August this year. I shall make some observations in the process of helping our colleagues in relation to DC3 aircraft and their costs as we know them in the Department of Civil Aviation. The price of my aircraft depends on many factors, including not only the market situation for the type of aircraft but also the time remain ing before the airframe and engines become due for major overhaul. A DC3 airframe overhaul costs in the vicinity of 535,000 and each engine overhaul costs in the vicinity of $10,000. Other factors, such as the radio and navigation equipment installed, passenger facilities and interior furnishings, have a bearing on the price. So, the only comment that we make on this DC3 cost situation is that the 6 DC3s were purchased as a single package, including some spares, for $275,000. They had been fully overhauled, as far as we know, prior to purchase and they had been fitted with first class passenger fittings and interior furnishings. So, the price would appear to be reasonable having regard to those factors.

A number of other matters were raised in this debate. Unfortunately, it was some time ago. I tried to recollect them and to make what I could of the notes I had available. If I do not deal with the matters in order, I trust that honourable senators will understand that I am not being ‘ti le to anybody, and if I fail to cover any of the points the reason will just be that time has elapsed. Senator Douglas McClelland referred to answers not being provided to him by the Department of Trade and Industry through me. 1 shall certainly check that matter out. But I think I should observe in passing that from the end of February until 31st August I was asked by various honourable senators about 300 questions over a range of 8 departments. So, it is to be expected that from time to time the usual Cotton courtesy, alacrity and efficiency in service might slip a little. But we do our best.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– I am not blaming you.

Senator COTTON:

– I did not think the honourable senator was blaming me. I assure him that I shall be following the matter up, as I always do. This first reading debate has had a fairly wide compass. As a senator, I have been concerned for quite some time now about the work load of senators. In my view, it is quite substantial; in fact, it is heavy. I believe that senators perform extremely well. The work load of Ministers also is heavy. However, 1 will take up the matter Senator Douglas McClelland mentioned. I was interested in bis observations on Austraiian artists and entertainers and on the ‘Adventure Island’ series. I was interested also in the comments made by Senator Hannan. I do not wish to intrude into that matter. Obviously it is one for those with more specialised knowledge than I have. Nevertheless, ‘«i respect of debates of this character it is my practice to raise the matters referred to with the responsible people in the departments concerned, and that will be done in this case.

Early in the debate Senator McAuIiffe dealt at quite some length with the matter of national fitness. For my sorrows, an uncle of mine, Professor F. S. Cotton, was the beginner of sports medicine in this country and was notable in trying to build up the standard of medical fitness of Australian sportsmen. His work has been carried on by Dr Corrigan, who was a student of his. So, in common with the honourable senator who mentioned this matter, I have a strong interest in looking towards a greater degree of national fitness. The proposal which somebody made to the effect that gymnasiums and swimming pools in schools might be worthy of attention in regard to Commonwealth assistance as in the case of libraries and science blocks, in my view, has much to commend it. I can see merit in that and I intend to raise the matter with the responsible Minister.

Senator Keeffe raised the matter of people in Antarctica not being able to vote. We have already sent that matter to the department concerned. Senator Gietzelt made some observations on taxation matters in general. They have been sent to the Taxation Office. No doubt other honourable senators will be speaking on those matters in the second reading debate on this Bill. I think we should now proceed to that debate, which will allow a critical examination of some of the taxation items to be made in more depth and more detail.

Question resolved in the affirmative.

Bill read a first time.

Second Reading

Senator COTTON:
New South WalesMinister for Civil Aviation · LP

– 1 move:

That the Bill be now read a second time.

The purpose of this Bill is to declare the rates of income tax for the current finan cial year 1972-73. The Bill will give effect to changes mentioned in the Budget Speech. The Bill’s most significant feature is the new personal tax scale which will reduce tax payable by individuals by an average of 10 per cent. The new scale will apply free of any additional levy. It is estimated that, as compared with tax that would be payable if the existing scale and 2i per cent levy were continued, the new scale will reduce income tax payments in 1972-73 by $380m and by $480m in a full year.

As was said in the Budget Speech, the interaction of money incomes rising with inflation and the progressive rate scale has led to income taxation becoming too heavy a burden. The low income earner is contributing a proportion of his income in taxation far higher than 10 or 15 years ago; the man on average weekly earnings or a little more is finding income taxation looming increasingly larger in his calculations; and the managerial or professional man is facing marginal rates of taxation which on any reasonable criteria are very high indeed. The new scale is designed to give the greatest percentage reductions in taxation at the lower end of the income scale. The tax payable on a taxable income of $2,000 will be reduced by 14.2 per cent. For a taxable income of $4,000 the reduction will be 12.4 per cent. At $10,000 the reduction will be 8 per cent and at $20,000, 6.6 per cent.

If we are to make the large percentage reductions which we wish to see at the lower and medium income levels, the rate of progression of marginal tax rates would become very steep indeed if the point at which the maximum marginal rate becomes effective were to remain unchanged. That point, which was $32,000 under the scale existing since 1954-55. was altered in the course of the changes made in 1970-71 and is now $20,000. Wc propose to set a new point of $40,000 at which the new maximum rate of 663 per cent - that is, the present maximum rate but without the 2i per cent levy - will apply. These reductions in tax payable will also be fully reflected in tax payable by primary producers subject to the averaging provisions of the law and by taxpayers whose rate of tax is based on a notional income.

The minimum taxable income for individuals will be raised by the Bill from $417 to §1,041. This new minimum will also apply in assessments of trustees on income of trust estates to which a beneficiary is presently entitled but is under a legal disability. As a consequence of the increase in the minimum taxable income in these cases changes are proposed in the ‘shading-in’ arrangements which apply to cushion the impact of moving from complete exemption into lax at normal rates. Tax at normal rates will commence to apply on taxable incomes above SI, 120 instead of $428 as at present. For taxable incomes between $1,041 and $1,120 the tax payable will be limited to two-thirds of the amount by which the taxable income exceeds $1,040. The change in minimum taxable income, which will free some 600,000 taxpayers from tax, is estimated to reduce personal income tax payments by $14m in 1972-73 and by $!8m in a full year.

The present exemptions granted under the age allowance will remain for eligible people. Because of the reduction in the general rates of tax, however, tax as limited by the age allowance will now shade-in’ to the general rate scale at $2,202 or, where the married couple provisions apply, $3,871. Schedules of tax instalment deductions to be made by employers from salaries or wages paid to employees have been revised in the light of the proposed reduction in tax rates and the increased minimum taxable income. The new schedules have effect as from 1st September. Provisional tax payable in respect of the income year ending 30th June 1973 will also be adjusted to take account of the changes proposed by the Bill.

Apart from the features I have mentioned, the provisions of the Bill have the same practical effect as corresponding legislation for the 1971-72 year. Technical aspects of the Bill are explained in the explanatory memorandum which is being circulated. I commend the Bill to the Senate.

I point out that there are 4 associated taxation Bills. I have just read the second reading speech on the Income Tax Bill. The second is the Income Tax Assessment Bill (No. 5) on which the second reading speech has been made already. The third is the Sales Tax (Exemptions and Classifications) Bill (No. 2) on which the second reading speech has been made already. The fourth is the Export Payments Insurance Corporation Bill on which the second reading speech also has been made already. It would be appropriate, with the permission of honourable senators and the Leaders of the Australian Labor Party and the Australian Democratic Labor Party, to have a cognate debate on these Bills. Honourable senators could speak on these Bills and, of course, separate questions could be put.

The ACTING DEPUTY PRESIDENT (Senator Laucke) - ls it the wish of the Senate that these Bills be taken as cognate measures? There being no objection, it is so ordered.

Debate interrupted.

page 1240

REPORTED HIJACKING OF AIRCRAFT

Senator WHEELDON:
Western Australia

– by leave - I apologise for interrupting the proceedings but I want to raise a matter of some urgency which, I think, should be drawn to the attention of the Minister for Civil Aviation (Senator Cotton). There are reports that an Olympic Airlines aircraft has been hijacked on a flight out from Sydney; and that the Williamtown air base has advised that a device had been set off indicating that something of this nature had taken place on the plane. As this is a matter of urgency, I have sought and obtained leave to bring it to the attention of the Minister.

Senator COTTON:
New South WalesMinister for Civil Aviation · LP

– I must say that it was extremely courteous of the honourable senator to draw my attention to this matter. I appreciate the thought. I knew about this before I came in to the chamber. The necessary operations that are called for in these circumstances have been set in train. The necessary reports have been made. The whole situation is being watched very very carefully. I can assure the Senate that I am being reported to on the matter quite regularly. As soon as I have something which I can positively say, I shall let honourable senators know more about it. The indications at the moment are very brief indeed. The plane is on its way to Singapore. It will probably pass over the Australian mainland between Broome and Derby. We will just have to wait on information coming in. I again thank the honourable senator very much for raising this matter.

page 1241

INCOME TAX BILL 1972

Second Reading

Debate resumed.

Senator WILKINSON:
Western Australia

– The suggestion that the Senate should debate 4 Bills together was something which I intended to make. I do not propose to move that the debate on the Income Tax Bill be adjourned. I think that anyone who wishes to speak on this Bill has had ample opportunity, bearing in mind the interval between the introduction of the Bill and the resumption of the debate today, to prepare himself for it. These 4 Bills - as a matter of fact I think it might have been 5 Bills - were debated together in the other place. They were discussed only briefly because they are such that the Opposition has nothing but support for what they propose. The Opposition would wish that they had gone a little further. However, as far as they go no objection is raised by the Opposition.

I would like to mention briefly each of the Bills. The first is the Income Tax Bill 1972. It increases from $417 to $1,041 the point at which income tax becomes payable and we believe that this is a very desirable feature. We even think that the amount should have been greater than that. We think that the schedule should be looked at very closely. We feel that this is a temporary measure and ought to be taken further. Also, the additional tax of 5 per cent which was imposed in the previous year and subsequently reduced to 2i per cent has now been removed. We think that this is an excellent provision. The Income Tax Assessment Bill (No. 5) 1972 is something that we cannot help but approve because it will make much more liberal the allowable deductions in respect of the dependants of a taxpayer. It will also make opportunities for further deductions for education expenses.

The next Bill is the Sales Tax (Exemptions and Classifications) Bill (No. 2) 1972. Personally I can find little justification for bringing it forward because I could think of some other sales tax remissions that might be made or sales tax on certain items removed before considering an item such as imported works of art as deserving of a reduction of sales tax. However, we have no objection to this legislation and it will therefore go forward with our support.

The last piece of legislation - the Export Payments Insurance Corporation Bill 1972 - increases payments to that Corporation up to $8m. This is quite a desirable feature. The Opposition has seen the successful operations of the Corporation. It is obvious, from the requests that are being made for assistance from the Corporation, that it is worth while expanding its operations in the way that is proposed i:i this Bill.

I do not think there is any need for me to go further in this group of Bills. The Opposition feels that the legislation before the Senate is quite satisfactory. It might have been taken further, but at this stage we are prepared to give the Bills a speedy passage. 1 hope that the Senate generally will agree with the legislation.

Senator GUILFOYLE:
Victoria

– I relate my remarks to the 2 Income Tax Bills - the Income Tax Bill 1972 and the Income Tax Assessment Bill (No. 5) 1972 - which arc being discussed as cognate measures in this debate. Firstly I refer to the Income Tax Bill 1972, the purpose of which is to declare the rates of income tax for the year 1972-73 at the rates referred to in the Budget Speech of the Treasurer (Mr Snedden) for this year. These rates were to take effect from 1st September. They were to give effect to a reduction of personal income tax by an average of some 10 per cent. The new scale will apply free of any additional levy at all such as the rate of 2i per cent or 5 per cent which we have, seen in the past. These new rates will give an effective reduction at the previous rate of tax of some $3 80m for this year or $480m in a full year.

As the stated objective of the Budget was to create an expansionary situation for consumer spending, it is noteworthy that these reductions in personal income tax will release some personal spending capacity into the economy. I welcome these reductions for another reason because for a very long time it has been felt that personal income tax rates on a rising scale as applied to income have been high and in many cases have been disproportionate. A higher proportion of income paid in tax by the lower income earners is now applied than would have applied, say. 10 years ago. 1 think in the management and professional classes of income earner this is extremely disproportionate.

There are some examples which I would like to state with regard to the application of the new rates. Perhaps I could pick at random differing income levels and describe the effect of these reductions. Firstly 1 would like to instance a person who has an annual income of S3, 484 and has no deductions except for those of dependants. If this taxpayer had no dependants we would find that the application of the new rates would give him a reduction of $71.60 or 13.2 per cent in income tax rales for this current year. If he had a wife and 2 dependent children he would have a reduction of $82.15 or 22.3 per cent in the year. If he had 4 dependent children and a wife he would have a reduction of $8S.88 or 29.8 per cent in tax payable.

If we move to the income scale of $5,096 per annum, we find that a taxpayer with a dependent wife and 4 dependent children gains a reduction of SI 61 .98 or 22.2 per cent in the tax payable If we take an actual income of $12,000 for a taxpayer with a dependent wife and 4 dependent children, his reduction in tax at these new rates would be $412.77 or 11.3 per cent of the lax payable.

These instance the effect of the new rates as announced and, I think, in general indicate a benefit to the taxpayer by the applicable reduction in the rate. Another area to which I wish to refer is the change in the minimum taxable income for individuals. Under this Bill this amount will be raised from $417 to $1,041. This will free some 600.000 taxpayers from the payment of tax. lt will result in a reduction of collection of tax of about SI4m for this year or SI 8m in a full year. In referring to this application of policy I draw attention to the report of the Commissioner of Taxation for 1971-72 wherein, under the heading of Management, Organisation and Personnel he states:

In the administration of the taxation system, the primary objectives of the Commonwealth Taxation Office are to obtain a high level of compliance with the law while keeping the costs of collection within reasonable bounds and ensuring that administrative practices will not place any avoidable burdens on the taxpaying community. 1 think that administrative practices which will not place any avoidable burdens and keeping the costs of collection within bounds are part of the reason for this change in the minimum taxable income as applicable from this year. The fact that some 600,000 taxpayers have paid about $14m in tax this year and now will no longer be required to lodge a return at that level gives some basis to the thought that perhaps collection costs and administrative practices will be served by this more realistic application of a revised minimum taxable income level.

Some other comments by the Commissioner are of interest as we review the system of collections. A paragraph in which the Commissioner states that from the beginning of 1971-72 a new system has been installed using computer assisted assessing is noteworthy inasmuch as it. is now in full operation in all States. Under this system the returns are examined by assessors as in the past but they are able to concentrate more on the technical aspects of their work, knowing that the computer programme is able to make adjustments on detail and take other appropriate measures where the amount of a claim might exceed what past experience of the assessing officer shows to be reasonable. The computer assisted programming within a department as complex as the Commonwealth Taxation Office is an advance in technological service which we feel sure is in the interests of administration and the application of cost to income revenue earned by the department. The statistics which are shown by the Commissioner point to the complexities which range within such a department. When we see that in the course of the 1971-72 financial year some $6, 128m in tax was collected from taxpayers, 7,149,000 income tax returns were processed and 6,121,000 income tax assessments were issued, we realise just how much detail is handled by the department and now much administrative costs need to be taken into account in the collection of the tax which is applied in any budget.

I refer again to reductions which ure envisaged by these new rates. We must remind the people of Australia that these are quite concrete. They are not notional figures which we talk about. This is actual money which is of benefit to the individual taxpayer. It represents a reduction in the rate which will be applied to a taxpayer’s income for this financial year. Since the announcement of the reduction I have seen it written that if we relate the percentage of increase in take-home pay to income we will obtain figures which show some disparity. It has been pointed out that on an annual income of $4,000 - which covers approximately one-quarter of all taxpayers and which relates in general to average weekly earnings - there is an increase in the take-home pay of $97 or 2.7 per cent. This was contrasted with an annual income of $15,000 where it was shown that the increase in take-home pay on the new rales would be $460, that is, a 5 per cent increase in take-home pay. It has been claimed that this is nearly twice as much proportionately and that there is disparity in the application of these new rates.

I point to that as an instance of some of the reporting which has been applied to the Budget. But equally it could be stated that if we relate proportion of annual income paid in income tax at the 2 different levels of $4,000 and $15,000 we find that there is disproportion in the rates which are applicable. We find that a person earning $4,000 per annum pays 1 1 per cent of his income in tax whereas someone at the income level of $15,000 pays a tax rate of about 34 per cent of his income. I find disproportion in these figures but I do not question that in terms of a rising scale of rates which are applicable. But I think it is incomplete to talk about disproportion in take-home pay by reduction of tax without also stating the disproportion which there might be in the level of tax which is applied at the relative income level. As part of the Budget which I support 1 welcome the reductions which have been outlined.

I find some comfort in the establishment of a committee of inquiry into the tax system of Australia. It was announced by the Treasurer that a committee of inquiry is to look at the tax structure. This is to be a full scale public inquiry. Already it hits had appointed as its Chairman the honour able Mr Justice Kenneth William Asprey, Q.C., a judge of the Supreme Court of New South Wales. I believe that the appointment of such a committee with the other experts who have agreed to serve upon it will make public an inquiry into the method of tax collection in Australia. But 1 make the comment that we should take the parallel perhaps from the United Kingdom which is at present in the midst of major tax reform. We should nom that the reforms which were instituted in the 1972 Budget of the United Kingdom were not the result of a present or recent public inquiry but rather they were proposals which had been thought through by the present Government of the United Kingdom. They were part of a programme which was presented to the people of the United Kingdom when the present Government was campaigning for election.

What I am saying is that whatever the functions of the committee of inquiry, Government action will still be needed for us to achieve a review of the collection of revenue by income tax. In the United Kingdom wc have the application of a very different taxation system from our own. Similarly, we could point to the Carter commission in Canada which conducted a full scale public inquiry and yet was not instrumental in any major reforms. I think the fact that we will have the public inquiry will be the first step towards achieving some review for which professional bodies in Australia have been pressing for some time. I would like to think that the Government decision which will be needed to restructure the taxation system will be the result in due course of recommendations of an inquiry.

Even after the reduction in revenue this year there still will be an increase of some $390m collected in pay-as-you-earn tax from individual taxpayers, most of whom are wage and salary earners who have their tax collected under the pay-as-you-earn system. We are in the midst of rising wages and costs and this application of income tax on a graduated scale still means that a reduction in rate will result in an increase in collection. To this end, I think it should be noted that last year individuals under the pay as you earn system contributed some $2, 888m in personal income tax and this year arc expected to contribute some $3,278m. This points to the need again for a review of rates. I hope that this present reduction in rates will be an immediate benefit to the spending in our economy and that it will point also to the need for the major restructure which we hope will take effect in the not too distant future.

The second Bill to which I refer is the Income Tax Assessment (No. 4) Bill 1972 which will give effect to proposals announced in the Budget Speech to increase the maximum amounts of concessional deductions relating to dependants. In that Bill there is also provision for a tax deduction of self-incurred education expenses. It has already been stated that the increase in the allowance for deduction of dependants is $52 per annum as related to a spouse or a parent. It previously was $312 and is now $364 per annum. A similar provision applies with respect to a student, a first child under 16 years of age or to an invalid relative. Previously the rate of allowance was $208 and is now $260 per annum. The previous allowance for children after the first child was $156 and is now $208 per annum. These are other helpful provisions with regard to the reduction of tax rates because when applied to income on a rising scale of rates they not only reduce the amount on which tax is payable but also place the taxpayer at a lower rate of application of tax. This points, I hope, to a more realistic assessment of what is needed as a deduction for dependants, such as a wife, parent, child, student child or invalid relative, because at the level of $364 for a non-income earning dependant this is not a very great allowance by which the taxpayer can reduce his taxable income.

The other provision to which I referred was that of allowing self-incurred education expenses to be deducted for qualifications which are undertaken in regard to a career which is being pursued by a taxpayer. This is a measure which I have supported for a long time. I have always felt that the income earner who self-incurs education expenses, not only where it achieves a qualification directly connected with a career but also where it self improves or gives opportunity for greater educational attainments, should be allowed as a deduction from taxable income.

The fact that this provision is not subject to an age qualification and also that it does not require that a person be a full time student - the provisions are such that a part time student or a student undertaking a course by correspondence may claim this deduction - is a feature of this new provision.

The deduction is limited to an amount of $400 which brings it into parallel with the concession which is allowed to parents of student children. It will complement the present allowance for education expenses and will be limited to the difference between the amount of $400 and any amount allowable to a parent or other person for the education expenses of a taxpayer. I am pleased that that provision has at last been included as a measure of assistance to those people either with ambition or with endeavour who do self-incur education expenses for approved courses.

The only other matter to which I wish to refer is the fact that in this present income year an optional scale of tax instalment deductions will be applicable. An announcement was made on 15th September that the Commissioner of Taxation will allow a new tax instalment deduction schedule to be used at the option of employees, such as single people or working wives who wish to guard against tax instalments deducted from their salaries or wages not being enough to meet taxation assessed at the end of the year. Tn brief explanation of this, it should be said that the pay as you earn deductions for taxation purposes are calculated on a basis which assumes that there will be some deductions from the taxable income. There is a minority of taxpayers whose deductions for these items are not as great as the amounts taken into account in the general schedules. These people are now entitled to arrange with their employers for tax instalments to be deducted at higher than standard rates. This is a measure which I think is realistic because there are many people now who are in 2 income earning families. Many of the deductions are claimed only by one of the parents who is an income earner. Many of the people who have had pay as you earn deductions extracted from their wages find that at the end of the year those deductions have not been sufficient to cover the income tax which is levied.

The new optional schedule will make it easier for the employees who so wish, and have not lodged a dependants declaration with their employer, to have instalments deducted at higher than standard rates. This is very realistic. I instance the case of an employee from whose salary deductions have been made in good faith by the employer at the scale which has been released by the Taxation Office. The employee finds at the end of the financial year that the amount of pay as you earn deductions has not been sufficient to meet the taxation assessed and that money is owed. Those who have handled such situations know that taxpayers in that position suffer disquiet and disappointment. The new provision of the optional schedule will make it so much easier for those persons to make a personal choice and to avoid the levy of tax which at the end of a financial year is unexpected. With those comments on the 2 taxation Bills, I commend the legislation to the Senate.

Senator BYRNE:
Queensland

– The Australian Democratic Labor Party supports this group of Bills. I wish to make only a few minor observations. The concept and content of these Bills represent part of the economic plan of the Government as well as giving certain relief to promote activity in the community and to stimulate consumer opportunities generally. In view of this very strange, more modern phenomenon of stagflation, it will be interesting to see exactly how these Bills work out and whether this remedy applied at the proper time effects the result which it is desired to achieve. I think that the reduction in taxation at this time is commendable. It is just, and it is desirable that people in the categories in which such reductions are to apply should have been relieved of some of the burden of taxation.

I wish to make one or two minor comments, not particularly germane to the provisions of the Bill. The first is to ask the reason for the constant refusal of governments to accept the increasing burden that the working community is required to pay in transport fees to and from places of employment. Today we are living in a society where the decentralisation of industry is being attempted and people are moving more and more into the remote suburbs of the great metropolises. As a result, workers are required sometimes to travel across the city to their places of work. One of the great phenomena of our time is the level to which transport charges have increased. Workers are now required to bring their labour to the point of employment at great cost with tremendous depredation of their weekly income. No concession is allowed for the amounts paid by them for this purpose.

I have always thought that that was unjust. I think surely that it is a concept which should now be taken into account by those who frame the income tax law. A new approach should be adopted to it. After all, money which is expended in the earning of income is traditionally, and by the very nature and intent of income tax law, allowable as a deduction from the amount of assessed tax. I see no reason why expenditure of this kind should not move into the same category, more particularly as the burden is imposed upon those who are least able to bear it. J think that there is every justification for this concession being granted. Another observation 1 should like to make concerns the preparation of taxation statistics. I think it is important that the community should know the categories of employment, occupations and engagements in which incomes are being earned and on which taxation is being paid. At different times over the years I have asked whether the breakdown of taxation statistics should not include a more particular discrimination in occupation and a fragmentation in professional occupation so that the community could see the levels of incomes in the various categories. In my opinion this would not break the principle of confidence. It would inform the community and could indicate to those who wish to follow certain professions or to pursue certain vocations where the opportunities lie.

I see no reason why secrecy should be taken to that extent. There would be no violation of individual private confidence, merely an exhibition of levels of income earned by various categories. When we as legislators consider the incidence of taxation surely we are entitled to the fullest possible information as to the areas of income earned and the levels of income opportunity. However, for some reason best known to himself, the Commissioner for Taxation has consistently denied that request. Whatever the virtues of such denial might be there is ultimately, 1 think, a deprivation of an opportunity to those who have the responsibility for framing equitable, just and distributive taxation laws to do their job more adequately.

The Democratic Labor Party supports the income tax Bills because, as 1 have said, we think they are both timely and just. There may be other adjustments which are equally desirable, but certain concessional deductions and the raising of certain levels of exemption from tax are very desirable. We are hopeful, while not speaking politically or Party politically but in the interests of the nation, that the techniques which are applied partially by these Bills will have the effect which is contemplated. We are hopeful that this process of stagflation and of erosion of purchasing power and the other processes which are operating to the detriment of the community will at least in part be halted by this process and that they will make a due contribution and that the real value of income will again be sustained. For those reasons we support the Bills.

Senator WEBSTER:
Victoria

The Government decided in the Budget which was brought down in August last thai drastic changes would be made to the income tax burden which falls on various sectors of the community. It is a credit lo al! sections of the Senate - the Opposition, the Democratic Labor Party and certainly supporters of the Government - that they applaud this action. I would see it as an obligation to make known the quite drastic changes that have taken place and the very great effect that will be felt by the community in this year and into 1973 following the easing of the income tax burden. The Income Tax Bill 1972 does 2 things. It indicates that a minimum income shall be earned by a person before he shall pay tax and it sets the rates of taxation to be applied to other incomes. This is the Bill to which 1 wish to direct my main comment, though I appreciate that just before the second reading debate began the Minister for Civil Aviation (Senator Cotton) took the opportunity to say that 4 Bills would be dealt with as cognate measures.

In his Budget Speech the Treasurer (Mr Snedden) gave a number of reasons why the Government had taken this action and he showed where the benefits would flow. Any thinking person who has paid tax, and that applies to every wage earner in the community, has had the incidence of tax emphasised to him or her every week of the year. When one completes a taxation return and realises the volume of income tax that is paid into the Commonwealth coffers for the benefit of the community in general, one realises that the personal rates of taxation have become burdensome over recent years. Great credit must go to the Treasurer and to other members of the Cabinet for having taken action this year to see what could be done as an initial step to make the burden of taxation more equitable. I believe that to a great extent this abjective has been achieved. All of us would wish that those who receive less income should not find the incidence of taxation heavy.

The Treasurer gave 5 reasons for this decision having been taken, explaining that an enormous sum of money should be returned to the taxpayer’s pocket by the Income Tax Bill 1972. He said:

First, the personal income tax burden is becoming more and more severe.

He said also that because of the impact of inflation on a tax scale basically designed for another level of incomes, the burden of taxation was being felt more severely. That point needs to be evaluated first. That is, there has been an increase in the average wage and increases in salaries which have to a great extent gone beyond the rate of inflation. Indeed, the average Australian wage earner today is pretty well suited for the volume of costs he has to meet. We have a particularly wonderful country in Australia, which fact is reflected in the very high standard of living by comparison with nearly every other country. This Parliament has discussed many times the impact of the rate of taxation as an annual salary grew, it being agreed that that impact was becoming greater and that something had to be done about it. The first action has been taken in this Bill.

The Treasurer said, secondly, that the family man, with all his other commitments, is finding that the income tax burden is looming ever larger as a problem and that in relation to his income on the question of fairness, the volume of taxation which he pays, should be re-evaluated. Again, this is being done under this Bill. The Treasurer made a further most important statement; he referred to a fact which has not been generally recognised in the community but which has an impact on many people. He said:

Thirdly, rising taxation is affecting incentives and encouraging tax avoidance.

Everyone should realise that there does come a point when a man says, ‘What is the use of my trying further?’ In my experience of various industries I have seen employees ranging from the humble working man to the main executives who wish to take action which would reduce their taxation the incidence of which would in normal circumstances affect the individual’s incentive to work. We have all heard someone say: ‘Why should 1 attempt to gain a higher position? I will gain extra money but 1 will pay a greater proportion of it in taxation.’ There is always a temptation to take a second job under a different name. What is the reason for that? lt is for no other purpose than to avoid the incidence of taxation. The incidence of taxation has that effect on an individual’s incentive to work harder. I have great sympathy for many young men who 1 know in our affluent society. They have their permanent jobs, but when they knock off at 5 o’clock in the afternoon they go and work in a transport depot or in some other place in order to earn extra income so that they can maintain their cars, spend money on their girl friends or save money for a house which they propose to build. This is the very point outlined in this measure. The disincentive applies not only to the wage earner but also to the man in the higher salaried position. Here we find an inequality and it can be applied to members of Parliament as well as to business executives. The fact that companies can supply individuals with vehicles - this comment applies in the various areas which I have mentioned - provides a wonderful tax-free advantage. What is the reason for supplying a vehicle instead of adding an amount on to a person’s salary? lt is to avoid the incidence of taxation. A person’s incentive to work harder is lessened because of the increasing burden of taxation.

The fourth point which is noted in the Treasurer’s comments is that there have been demands for excessive increases in money wages and salaries during past years and I doubt whether anybody in the Senate can disagree with that. Wages have gone far ahead of the general rise in the cost of living and undue pressure for higher levels of wages is being applied by unions and other bodies. The proposal which the Government has introduced will reduce, we hope, the pressure for higher wages. Indeed, as from the date of the introduction of this legislation every salary earner found that his weekly pay packet contained more money. That is a major achievement of this Government. The Treasurer expressed it in these terms:

We believe our measures will provide ground for moderation.

It has been said - and I referred to this matter when I spoke in the Budget debate - that very little has been done in the Budget for industry generally and that greater emphasis had been placed on providing benefits to those people in less fortunate circumstances, and for that I congratulate the Government.

The fifth point is the one which, to some extent, pours some balm on that troubled water. The Treasurer stated that a reduction in personal income tax will put more money directly into the hands of consumers. He said that their take-home pay and their capacity to spend will be enhanced. He also said that there will bc a real lift to community and business psychology and that that is what is needed at this time. In short, I suggest that the business community will find very quickly that between now and Christmas there will be an impetus in the general level of business, and I hope that that will lead to greater efficiency so that the business community can take advantage of that increased spending.

There is a major point associated with this Bill which, in view of the wording which the Treasurer used in his Budget Speech if I might say so, was quite clouded. But if it was clouded, the outcome is of far greater credit to the Government than was apparent at the time when the Budget was introduced. One of the matters associated with the taxation proposals in the Budget was the reduction in the levy which was applicable to all incomes during past years. Honourable senators will recall that an impost of 5 per cent was placed on every income tax return so that no matter what amount of tax was payable under the income tax return, an extra 5 per cent tax was levied. Last April the Federal Government took action which reduced that impost by 2i per cent, or by 50 per cent of it. The Treasurer in his Budget Speech said:

In April we reduced personal income tax by 21 per cent; the reduction I now propose is on top of that.

He did not say in that Speech that what the Government proposed was the complete abolition of the 2i per cent levy that remained. That is what has happened. Not only has there been an average reduction of 10 per cent in the rates of taxation, as was stated, but also within the last 6 months there has been a further 5 per cent reduction in income tax. That is one matter that should have been spelt out quite clearly.

Senator Gair:

– The Gorton Government reduced tax by 10 per cent and gave pensioners a rise of 50c.

Senator WEBSTER:

– Senator Gair makes the point that governments of this complexion have been alert to their responsibilities so far as taxation is concerned, I stress the point that the public should be made aware of the fact that there has been a 5 per cent reduction in the tax which applied 6 months ago, and on top of that an average reduction of 10 per cent over the whole range of income tax. Senator Guilfoyle referred to the various levels of tax which will be paid and I do not wish to reiterate some of the figures that she gave. The main point that comes to my mind, and the main point that should be made, is that those on the higher level of income have been less suited by what the Government proposes to do. For instance, it can be said quickly that a single person with a taxable income of $18,000 a year will receive a reduction in taxation of 6.8 per cent. For a person with a taxable income of $18,000 a year, who has a wife and 2 dependent children, the reduction will be only 8.1 per cent. The point I wish to make is that those on the lower scale of income are very well suited under this measure. A person with a taxable income of $7,000 a year, who has a wife and 2 dependent children, will receive a reduction in tax of 12.8 per cent.

Senator Gair:

– So it should be.

Senator WEBSTER:

– So it should be, and Senator Gair agrees with this philosophy. Indeed, it was spelt out by the Treasurer. We find that a quite amazing situation arises in relation to the lower level of income. Perhaps we can refer here to what is the average wage level. For a man with a taxable income of $4,296 a year, who has a wife and 2 children, the reduction in taxation will be 19.6 per cent, and for a man with a wife and 4 dependent children the reduction will be 25.4 per cent. The figures indicate that some lower income earners will receive a reduction in taxation of 34 per cent. So I think it should be made known that the Government has acted in a most responsible way in attempting to effect a fair and equitable reduction in taxation.

The other most important point relates to the minimum taxable income. For years that figures has been $417 a year. Under this proposal taxation will not be applied to incomes of less than $1,041 a year. I believe that the impact becomes apparent when, as was stated previously, because of this measure about 600,000 taxpayers will be exempt from taxation liability. If this is applied to a population of 13,000 and we calculate the number of taxpayers there would be in that population, we find that there is a substantial percentage of people on low incomes who will now receive the great benefit of not paying income tax. I noted with some interest that in the American Budget of this year there was no reduction in income tax rates. Apparently that country took the view that it could take some other action which would give other benefits to its taxpaying public. I noted also that the British Budget did not alter the rates of taxation but gave substantial allowances to taxpayers.

It was in that context, of course, that the previous speaker Senator Byrne spoke about the wisdom of directing the Government’s attention and perhaps the attention of the committee of inquiry that is now looking into taxation to the argument that the cost of fares should be allowed as a deduction, as costs incurred in gaining an assessable income. It is my view, along with that of Senator Byrne, that fares should be allowed as a deduction when calculating assessable income. I believe that there are 2 other matters to which the committee of inquiry might well give attention.

Senator Milliner:

– You have never done anything about it.

Senator WEBSTER:

– An honourable senator opposite interjects: ‘You have never done anything about it’. More has been done by supporters of the Government to do something about it than members of the Opposition, in their relegated position as the Opposition for the last 20 years, have ever considered doing. I will emphasise that point in a moment. I have put forward a case in the Senate previously in regard to the necessity for statutory deductions for insurance or superannuation for persons who are self-employed to be investigated immediately. There is a state of complete inequality existing. A person who works for a large corporation can reduce his taxable income by $1,200 and the company, applying the amount to the individual, can gain, for the employee’s benefit a very substantial reduction in income tax. A self-employed person such as a doctor, lawyer or accountant can gain a deduction of only $1,200. I direct the Government’s attention to that. Although this is not part of this measure, I say also that [ believe the time is overdue for the incidence of undistributed profits tax of proprietary companies to be investigated. I know that the Minister at the table, Senator Cotton, has indicated to me, I think in the Senate, his attraction to those 2 lines of inquiry that I have mentioned. 1 applaud the Income Tax Bill 1972.

There is only one other matter that 1 would mention in view of the fact that an honourable senator of the Opposition interrupted anil said: ‘You do nothing’, lt gives an honourable senator some pride when, having prompted the Government on some matter in the Senate he sees the matter achieved, even if he has to wait for some years. I comment on the Income Tax Assessment Bill (No. 5) 1972 in which it is indicated that self-education expenses will be allowed to a certain amount. 1 believe that this is a most important matter. The second reading speech of the Minister for Civil Aviation (Senator Cotton) states:

The Government has decided, however, that a concession should be available for people who set themselves the task of gaining educational qualifications connected with their careers.

I would argue with that provision to some extent. The Minister continues:

We therefore propose a special concessional deduction for expenditure incurred by a taxpayer on fees, books and equipment associated with a course of education he undertakes for the purpose of acquiring qualifications related to his employment or career.

I say only that I hope that that phrase acquiring qualifications related to his employment or career’ is given a very wide brush. I prompted this matter in 1968. I refer to page 1 145 of the Senate Hansard of 28th May 1968 and the report there of question No. 240. I asked the Minister representing the Treasurer:

Does the Government wish to encourage part-time study by students in various institutions, colleges and universities throughout Australia?
Is it a fact that there is no provision for deductibility for income tax purposes of educational expenses incurred by part-time students?

I went on to ask whether, in view of the encouragement this would give, it would be considered by the Treasurer. Suffice it to say that the Minister representing the Treasurer in the Senate, Senator Sir Kenneth Anderson, gave quite a long reply which expressed the Government’s view at the time. He said:

I shall arrange for this proposal, along with various other requests for taxation concessions, to be considered during the preparation of the 1968- 69 Budget.

This is something which has been suggested by backbench members of the Government over a period of years and has been achieved at this time to the great credit of the Australian community. I have great pleasure in supporting the 4 Bills before the House.

Senator COTTON:
New South WalesMinister for Civil Aviation · LP

– It would be noted by those who listened attentively, as 1 have, subject to certain interruptions which are to be understood, that the Senate agrees with the Bills. Four Bills are being taken in a cognate debate. An honourable senator who wished to speak on a subject related to any one of the areas contained in the 4 Bills that we have just debated could do so. There is no great difference of opinion. There is general unanimity that the measures are useful, sensible and timely. I wish to make one or two brief comments that relate to some of the matters that were raised. Senator Guilfoyle remarked that the new deductions covered self-education expenses incurred in relation to a present career or employment. I am advised that it might be noted that the provision will not be restricted to a present career or employment. The deduction is also available when related to a new or future sphere of such activities. For example, a taxpayer who incurs self-education expenses to increase his future job opportunity will come within the scope of the new concessional deduction.

Senator Byrne:

asked that income tax Statistics be classified by occupation as a guide to enable people deciding on careers to see which positions are the more rewarding. I am sure that Senator McManus would comment that in the light of the parliamentary salaries, if they were so classified there would be very few applicants for the job. I have been advised that provisional taxpayers are classified by industry in the tables on pages 42 to 45 of the taxation statistics which are a supplement to the 50th report of the Commissioner for Taxation. The classification of over 4 million salary and wage earners by occupation would be a very big task that has not been practicable in the past. I am informed that the question of doing so is now under consideration although it is not practicable to say when it might be done. It should be mentioned that census statistics give some information on occupation of employees. It may not be as much as we would like, but none the less there is some information there.

Senator Webster supported Senator Byrne, I think, who referred to the introduction of a deduction for fares incurred in travelling to and from the place of employment. The courts and boards of review repeatedly have labelled expenses of this nature as private expenditure and as such there is no scope for allowing such items under the present law. An amendment of the law to provide a deduction for private travelling expenses has been suggested in various quarters on a number of occasions. In fact it was included with a wide variety of other proposals which were considered when framing the 1972-73 Budget. However, as the Treasurer (Mr Snedden) explained in his Budget Speech, it was decided to concentrate on tax concessions. Whilst it has not been practicable to accede to the request at this stage I am assured that it has been listed for future consideration and review in a future Budget context at the appropriate time.

Referring to Senator Webster’s speech again, I indicated in relation to Senator Guilfoyle’s contribution that the new deductions for self education expenses are not to be confined to an existing career or employment. I must mention also that reference to qualification does not have the effect of confining the deduction to expenses incurred in obtaining formal qualifications. They have the broad effect that the honourable senator suggested that they should have.

Consideration resumed from 14 September (vide page 889), on motion by Senator Cotton:

That the Bill be now read a second time.

Question resolved in the affirmative.

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

page 1251

SOFTWOOD FORESTRY AGREEMENTS BILL 1972

In Committee

Consideration of House of Representatives’ message (vide page 1049).

Senate’s amendment:

At the end of clause 3 add ‘, subject to the amendment of the agreement by the omission of clause 9 of the Schedule and the insertion in place thereof the following clauses: “9. The Stale shall ensure that planting during each year is carried out efficiently and in conformity with sound forestry, environmental and financial practices. “9a The State shall ensure that natural forests shall not be cleared for planting softwoods unless the particular proposed clearing has beforehand been the subject of an environme. n,al impact study made by an independent expert on behalf of the Australian Forestry Council and that Council after considering the report of the said study has approved the particular clearing.” ‘.

House of Representatives’ amendment:

In the Schedule, at the end of clause 9, add and shall ensure that environmental factors relating to the planting have been considered’.

Senator COTTON:
New South WalesMinister for Civil Aviation · LP

– The Senate having resolved to move again into the Committee of the Whole we are back where we were when this amendment was referred to the House of Representatives for consideration. I move:

Senator MULVIHILL:
New South Wales

– Honourable senators will recall that after the Senate dealt with this Bill it went back to the other place. I will refer to the general points which were made then by the Minister for National Development (Sir Reginald Swartz) and the honourable member for Dawson (Dr Patterson). The Minister said:

Machinery exists within the States for the examination of areas before dedication as State forest. The responsible attitude of Slate governments to land use is exemplified in Victoria where a Land Conservation Council has been established. . . .

Then he implied that other States had virtually paralleled these operations. When the Senate decided to amend the initial legislation I suppose various honourable senators acted from different motivations. Senator Cotton will be well aware that New South Wales senators remained unconvinced, not necessarily about the Commonwealth Government but about whether the New South Wales Government was completely following the principles which had been expounded by the Minister for National Development (Sir Reginald Swartz) in the other place. We accepted the revised schedule providing for an examination of some areas and I should say that the only area that remains in dispute is the one in New South Wales which has become a vexed question I refer to the Boyd Plateau.

Without recapitulating too much of what has been said, I recall that Senator Cotton questioned whether the area was really worth salvaging. He implied that because of the ravages of bushfire it was almost a shell. Since then some people and I have had conversations with Mr Milo Dunphy, Secretary of Save Colong Committee, and other people. They strongly disputed what Senator Cotton had stated and suggested that if a party of senators wished to visit the area the Save Colong Committee would be happy to take them through the area. I repeat that suggestion very seriously. Senator Cotton will appreciate that this Bill has come on for debate earlier than was expected, as a result of which 1 do not have all my documents with me. However, to get to the crux of the matter, I understand that the Minister for Conservation in New South Wales, Mr Beale, indicated that a feasibility study would be undertaken. So far there has been no visible sign of such a study. The conservationists have formed the impression that in matters of this kind the appeal is from Caesar to Caesar.

I hope that the New South Wales Forestry Commissions would approach their responsibilities in matters of conservation with a spirit of give and take. So I should like the Minister for Civil Aviation, when replying, to be fairly specific on whether the feasibility study which apparently has been offered by Mr Beale will take place. I think this matter comes back to the economics of softwood. I commend to the Minister a paper which he has probably read, entitled ‘The Pine Programme in New South Wales’. The author argues the matter from both the economic and ecological aspects. I know that the Minister would take the stance that the more we reduce our imports of timber the better it will be for the economy. However, as with any other theory, that can be taken only so far, as it may well be that for strong reasons some timber imports will have to come from New Guinea and New Zealand. Even if current timber imports total S200m, this programme would not cancel out such a scheme because Douglas fir and other varieties will still have to be imported.

I do not wish to jeopardise the broad programme which I know has the support of State governments, but I am trying to emphasise that I fail to see why there can not be a reasonable understanding by the New South Wales and Commonwealth governments on the Boyd Plateau being given a reprieve. I do not want to delay State forestry operations, but I hope that even if we rubber stamp the Bill Senator Cotton must indicate that the parties in this place who have been interested in the subject should visit the area to see what is involved and attempt to convince Mr Beale that the Boyd Plateau is not the be all and end all of forestry in New South Wales.

We note that as late as today in the Melbourne ‘Age’ Mr I. G. Mosley, who is the acting chairman of the Save Our Bushlands Action Committee, which is very active in Victoria, has written a letter applying to the Victorian scene in which he says that logging scars our parks of the future. The Minister would know that Mr Mosley has had a very effective role with the Australian Conservation Foundation. Although points were made in the other place about the Forestry Commission having certain responsibilities, it seems to me that in New South Wales and in Victoria, unless monitoring is continued, things will not be what they should be. I understand that the present debate is on the basis of consideration by the Committee; so I speak now for the Save the Colong Committee and a host of other conservations groups which believe that, a road block having been set-up, Mr Beale and the New South Wales Government should indicate clearly why there is such a vital tussle over the Boyd Plateau. Also, in keeping with the spirit of this Bill, they should indicate whether it is proposed to make a feasibility study. I spoke at considerable length during the previous debate on the Bill and I have tried now to narrow my objections to one field.

I make the passing comment that my colleague in the Legislative Council in New South Wales, Mr Clive Healey, MLC, cited some figures that he had received from the Minister for Conservation about a delay in forestry work and the workforce involved. I think that some of the figures and some of the propaganda associated with this issue about the jobs involved have been somewhat exaggerated. But this does not mean that we can stand idly by and see pools of unemployment created. I think it is important to keep this issue in proper balance and be factual when discussing it - in effect providing ample forestry work but not destroying native bushland. We have no desire to jeopardise the afforestation programme.

I come back to our original contention, that where there is ideal native bush and forest we do not want the area to be bulldozed. Our main objection at the moment is to the rather evasive attitude which has been adopted by the New South Wales Government in regard to this matter. Senator Cotton will be aware that unfortunately in New South Wales the controversy over the Colong caves, which have been linked with this area, has caused some of the difficulty. We are aware that the complexities of government resulted in the matter being dealt with by 2 or 3 State Ministers. I know that Mr Beale, in his role as the Minister for Conservation in New South Wales, has other responsibilities. I hope sincerely that if we give the green light to the principles of the Bill. New South Wales will keep faith with the spirit of compromise which has been evident. Nevertheless, I remain completely unconvinced that it we agree to the legislation the Boyd Plateau will not be turned into a pine plantation and that its value as a plantation will be infinitesimal in the overall plans for pine plantations, lt is on that basis that, with many other conservation.ists we are trying to be fair and reasonable. I hope that Senator Cotton, either directly or indirectly as a result of what I have said, will be given a fair account of what is happening. I sincerely hope that the 35,000 acre Boyd Plateau region can be preserved as a monument to conservationists and foresters living successfully together.

Senator BYRNE:
Queensland

-The Australian Democratic Labor Party is particularly involved in this matter. The Bill which originally came before the Senate related to an agreement between the Commonwealth and the States in connection with softwood forestry and its purpose was to re-write an agreement lor the provision of money by the Commonwealth to the States to assist with reafforestation. Annexed to that Bill was the Agreement negotiated between the Commonwealth and the States, to be finally concluded by signature. The Democratic Labor Party was concerned that the Agreement contained no provision to the effect that the other parties to it, or the Commonwealth, should have regard to environmental factors when the Agreement was negotiated and when the money was being provided or that ‘.hat should be a condition precedent to the provision of the money.

For that reason, when the Bill was last before this chamber we moved an amendment to clause 9 of the Agreement by which we substituted a new clause 9 and added clause 9a. That amendment was adopted by this chamber. The Bill was returned to the House of Representatives. lt has been considered by that House, which has not seen its way clear to adopt the amendment as proposed and carried here. The Bill has now come back to this chamber with a proposed amendment which does one important thing. It does not go as far as our amendment would go, but it does write in a provision which was suggested by the Government and carried by the House of Representatives. Originally clause 9 of the Agreement read:

The State shall ensure that planting during each year is carried out efficiently and in conformity with sound forestry and financial practices.

That has now been amended by the House of Representatives by the addition of the following words: and shall ensure that environmental factors relating to the planting have been considered.

In other words, the Agreement which is now contemplated for conclusion between the Commonwealth and the States requires that the States shall take environmental factors rft to consideration when afforestation with softwoods is being considered, natural areas are being interfered with and natural forests are being destroyed.

This is the first occasion, to my knowledge, on which the environmental factor has been introduced into legislation. As I have said, this is of particular concern to members of the Democratic Labor Party. It is very gratifying to us because, of all the parties in the Parliament, we were the first to introduce in a national policy speech a programme of national conservation. For a party of the dimensions of our Party compared with the major parties, that is somewhat of an achievement. Our contribution in this field has not been minor by any means. Senator Little, my colleague from Victoria, was a member of the Senate select committee that investigated the matter of air pollution. I had the pleasure of serving on the Senate Select Committee on Water Pollution which was chaired by Senator Davidson. Our service on those committees, coupled with our national programme and policy on conservation, demonstrates that the Democratic Labor Party has been intimately associated with this new and very vital question which only now is receiving continuous national and international attention at the highest levels.

That is why, when this Bill came before this chamber originally, we proposed that environmental factors should be considered in the conclusion of the agreements. We hoped that the matter of whether or not the environmental factors were considered adequately by a State would go to an independent authority. The reasons that have been put forward as to why that would not be acceptable are valid and compelling, in our view, and that persuades us not to pursue the whole of our original proposition but to accept the amendment which is now before us and which is based on that proposition and does take into account the environmental factors.

The reasons that have prompted us to adopt this position are as follows: This is an agreement which is written, one might say, halfway through the currency of the existing agreement. Forestry is a type of project that has to be planned some time ahead. If we were now to write into this Agreement the proposition of an independent authority assessing the environmental consequences, it might interrupt the whole of the current planting and, because of the time that would be involved, might well require the displacement of labour and the interruption of certain forestry projects. I think that would be a completely undesirable and indefensible thing to precipitate. If we have the principle accepted, that environmental factors should be considered and that that shall be written into the next agreement as it begins to run which will be in 1976, we can claim that we have really been responsible for a major achievement.

I do not intend to pursue this matter at length. 1 merely reiterate the point that we have been responsible - we take great credit for this - for introducing the consider ation of environmental factors into Commonwealth legislation in this specific way for perhaps the first time. Those who were very interested in this matter and who originally were very anxious that we should put forward the proposition are satisfied that a great deal has been accomplished and that this will be the beginning of the consideration of environmental factors in many fields in the future.

Senator Webster:

– Your claim is a little drastic, is it not? Do you not think that the State Ministers would take some of those factors into account?

Senator BYRNE:

- Senator Webster’s point is well made. 1 think that in some way the Slates have been somewhat in advance of the Commonwealth in their solicitude for environmental protection.

Senator Webster:

– I thought you were claiming the credit.

Senator BYRNE:

– I said that the Democratic Labor Party was the first party to put such a programme into a national policy speech and, to my knowledge, we were the first to introduce it legislatively in this Parliament. Where the States have done it - of course, they have - I do not take the credit away from them. I am disappointed in relation to the report of the Select Committee on Water Pollution, which contemplated the creation, in cooperation with the States, of a national body projecting the concept of cooperative federalism and not using the overriding powers that the Commonwealth might be able to aggregate under the various heads of power in the Constitution. To my knowledge, that proposal has not been implemented with the enthusiasm and at the level that we members of the Committee hoped it would be. We feel that, because of our strange constitutional situation, the protection of the environment is not a matter that can be handled without the closest co-operation between the Commonwealth and the States.

Senator Mulvihill:

– In your speech in the second reading debate you supported the Boyd Plateau issue, did you not?

Senator BYRNE:

– Yes.

Senator Mulvihill:

– Do you still support it?

Senator BYRNE:

– Yes. We do not change our positions. But that is not particularly germane now. That was a general proposition which I supported when I spoke to the Bill originally. We are now considering a specific amendment in Committee and it would be a digression to deal with matters of that kind. I am directing my remarks particularly to the adoption by the Government and the House of Representatives of a principle which initially was in a different form but which has been adopted substantially as we proposed it originally. That is extraordinarily gratifying to us. I know that the conservationists - of whom there are many associated with our Party, as there are associated with all political parties; it is a growing movement with developing enthusiasm - will be gratified to see the national recognition in this form and the fact that the Commonwealth has now insisted that, in an agreement between the Commonwealth and the Slates for the provision of money to the States for afforestation, there be a requirement that the environmental factors shall be taken into account. This will be regarded as a very great advance in the field of the conservation of the environment generally.

For those reasons the Democratic Labor Party supports the amendment as propounded in the House of Representatives, carried by that House and now presented to this chamber for confirmation. We do not pursue our original amendment which has been adopted substantially and in principle in the amendment we are now considering. We think that it will improve the Agreement. We know that the closest cooperation will be received from the States. We have every reason to expect that this form of words will not be regarded merely as such but that there will be due regard for environmental factors in terms of the amendment, under which the Agreement will provide that the States shall ensure that environmental factors relating to the planting have been considered. This will operate really as a condition precedent to the money being made available. The States will, in honour, regard it as such. Therefore, we can see a new future in the attitude to the protection of the environment consonant with national development. 1 make this final point: We must recognise that there must always be a coinci dence of the demands of national development and of the protection of the environment. One cannot be completely submerged to the domination of the other. Finding that balance, in prudence and wisdom, in the conservation and custody of our national heritage is of tremendous importance and is very difficult. It can be done with sufficient good will, wisdom and judgment. The Democratic Labor Party welcomes and supports the amendment now proposed to the Agreement.

Sitting suspended from S.4S to 8 p.m.

Senator KEEFFE:
Queensland

– Before the suspension of the sitting the subject of the discussion before the chamber was the alteration to the Softwood Forestry Agreements Bill 1972. You will recall, Mr Temporary Chairman, that a few weeks ago the Senate carried an amendment setting out certain fairly tight controls on the various State forestry departments in relation to conservation and insofar as the Softwood Forestry Agreements Bill was concerned. Subsequently the Bill went back to the House of Representatives which in turn has sent back the amendment we are now discussing which states:

That the Senate’s amendment be disagreed to, but that in place thereof the following amendment be made: ‘In the Schedule, at the end of clause 9, add “and shall ensure that environmental factors relating to the planting have been considered”.’

This is a watering down of the amendment that was originally carried by the Senate. The Opposition cannot be accused of being unco-operative. I think if we are prepared to accept this amendment the responsibility is then on the Government to ensure that certain measures - and perhaps it would be proper to describe them as safety measures - in relation to conservation are carried out.

I have been impressed by the way in which my colleague Senator Mulvihill has fought for the cause of conservation generally in this chamber. Earlier this year I decided to have a fairly good look during a road tour at many of the areas under dispute in New South Wales. I was not impressed with what I saw in some cases where areas of forests arc being disposed of in the cause of progress. I am not a fanatical conservationist. I believe that conservation and progress have to march hand in hand. But the responsibility of government is to see that there is balanced development. The programming envisaged over the next 20 or 25 years will cover several million acres which are to be replanted mainly to exotic softwoods. The area could be much greater than this. This will depend a great deal on population growth, overseas balances, what the Australian requirements are and, of course, how many synthetic materials are developed in that time.

Basically though, it is the Commonwealth that will be responsible. The Commonwealth ought at least to have the courage to have an overseeing eye so far as the respective State authorities are concerned. Senator Byrne, who spoke earlier in this debate, referred to the destruction of a eucalypt forest on the Boyd Plateau to enable the planting of softwoods with eventual milling in the Oberon area. I challenge the right of the Minister at the table to deal with this Bill in an impartial manner. I made some brief reference on the last occasion on which I spoke on this Bill. I was surprised at the bitter opposition that the Minister put on that occasion to the amendments. With all due respect to the Minister and his replies to questions in this House, he has not really been a friend of the conservationist. When we delve a little deeper one can probably find some of the reasons for this. I have complained on previous occasions about the political morality of the Government. Whilst I am not casting aspersions on the personal integrity of the Minister, I think he would do this Parliament and this country a service if he allowed some other Minister to handle this Bill.

Honourable senators will recall that Senator Cotton said on that occasion that a softwood forest in the area of the Boyd Plateau, which is not very many miles from Sydney, would absorb carbon dioxide at a massive rate. I ask the Minister, with all due respect for you, Mr Temporary Chairman, why he is not worried about planting softwood forests in those areas which have already been denuded of their indigenous trees and shrubs - areas much closer to the metropolis of Sydney - if he is interested in the absorption of carbon dioxide. Anyone who flies into Sydney can see at any hour of the day or night a great blanket of smog that arises from chemical causes in the city area. But this is the first occasion on which I have heard the Minister use in this chamber the words ‘carbon dioxide’.

The TEMPORARY CHAIRMAN:

–

Thank you.

Senator KEEFFE:

– Now, may I proceed?

The TEMPORARY CHAIRMAN:

– Yes.

Senator KEEFFE:

– I ask Senator Cotton if he held or still holds almost 18,000 shares in Timber Industries Pty Ltd.

The TEMPORARY CHAIRMAN:

–

Order!I do not think that this has anything to do with the Bill.I have asked Senator Keeffe to keep to the Bill. I cannot see anything in the Bill referring to that question.

Senator KEEFFE:

- Mr Temporary Chairman,I maintain that what I am saying is keeping very close to the Bill. I ask the Minister-

The TEMPORARY CHAIRMAN:

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– No, I have been in here since 8 p.m.

The TEMPORARY CHAIRMANOrder! Senator Douglas McClelland.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– I say with great respect that any member of this Parliament can say that any action of a Government is a politically immoral action. I believe that that was the tenor in which Senator Keeffe made his remarks.

Senator Young:

– On a point of order, I ask that the Hansard reporter report to us verbatim what was said. There seems to be some doubt as to what was actually said. I listened carefully to Senator Douglas McClelland’s remarks. I would like this clarified.

The TEMPORARY CHAIRMAN:

– The words used, I understand, were: ‘It would be politically immoral’.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– ‘For the Government’.

The TEMPORARY CHAIRMAN:

– Order! 1 do not think it is the place of any honourable senator to say that it is politically immoral so far as the Government is concerned.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– Oh!

Senator Carrick:

– Quite specifically I took a point of order under standing order 423. I set out specifically the words, to my recollection, which were said. Those words according to my recollection related to a charge of its being politically immoral lor the Minister to do something. I ask that action be taken on that. 1 draw on previous rulings and particularly the ruling given in the book by Mr Odgers which states at page 68:

The President should intervene when a Senator uses offensive words or makes personal reflections on other Senators. It is not necessary that a Senator should rise to a point of order, because the Standing Orders say that the President must intervene.

The TEMPORARY CHAIRMANOrder! Will you resume your scat please, Senator Milliner. I have asked Senator Keeffe to withdraw those words.

Senator KEEFFE:

– Mr Temporary Chairman, can I get the facts perfectly straight?

The TEMPORARY CHAIRMANOrder! It must be unequivocal. You must withdraw those words.

Senator KEEFFE:

– In relation to what? The Government or the Minister?

The TEMPORARY CHAIRMAN:

– Politically immoral’ were the words that you used in relation to the Government and the Government includes the Minister. Senator Keeffe,I want you to understand that the ruling has been given.

Senator KEEFFE:

– I do not understand it.

The TEMPORARY CHAIRMAN:

– You used the words ‘politically immoral’ relating to both the Government and the Minister. I think that that is entirely wrong and I ask for your withdrawal.

page 1259

DISSENT FROM RULING

The TEMPORARY CHAIRMAN:

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– Immorally wrong’ were the words-

Senator Marriott:

– No, ‘politically morally wrong’.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– All right - politically morally wrong for the Minister to handle the matter, and that therefore the implication was not only that it was wrong for the Minister but also that it was politically morally wrong for the Government to allow this course of action. Mr President, with very great respect to the Temporary Chairman of Committees, I believe that it is quite within the bounds of propriety for any member of this chamber to say that if is politically morally wrong for a government to undertake a certain course of action, to do a certain thing or to perform a certain act.

Frankly, 1 know that I personally in past years in this chamber have used such an expression - that it is politically morally wrong for a government to do a certain thing. The accusation that has been made against my colleague is not only that he has used it in the case of one individual in the Government, namely the Minister responsible for the Bill, but also that ha has used it in the collective sense against the Government as a whole. On that basis, I believe that the ruling of the Temporary Chairman of Committees should be dissented from.

May I also say that there was some doubt in my mind whether Senator Keeffe had used the words complained of by honourable senators opposite. Honourable senators opposite have claimed and have asserted that Senator Keeffe used the term that it was politically morally wrong for the Minister to be doing a certain thing. I was under the impression that Senator Keeffe had used the expression that it was politically morally wrong for the Minister, acting on behalf of the Government, to be handling the Bill before the Senate, lt is on those bases that 1 have moved dissent from the ruling by the Temporary Chairman of Committees.

Senator Wright:

– I take a point of order. Mr President, I draw your attention to standing order 429, which reads:

If any objection is taken to the ruling or decision of the President such objection must ba taken at once, and in writing, and Motion made, which, if seconded, shall be proposed to tha Senate, and Debate thereon forthwith adjourned to the next sitting day, unless the Senate decides on motion, without Debate, that the Question requires immediate determination.

– I rise on a point of order. I suggest that we should ask Hansard to give you, Mr President, in writing the words that were used so that you can read them to those honourable senators who were not present at the time. This would shorten the whole debate.

The PRESIDENT:

– Order!

Senator MILLINER:

– I repeat that 1 am not trying to defend anybody who may have suggested that a Minister was immoral. But when one talks in terms of politics,

I think it is slightly different when one talks of a Minister being politically immoral. But if they are the words to which honourable senators on the Government side have raised objection, then let me tell the Senate what the Temporary Chairman of Committees himself ruled. This is not what Senator Keeffe said and not what the President said but what the Temporary Chairman of Committees said: The Temporary Chairman pointed out that Senator Cotton was not the Minister responsible for the Bill but was only representing, as a member of the Government, the Minister in another place. That was the Temporary Chairman’s ruling. I have taken his words down and 1 would say they are 99.9 per cent correct. In those circumstances Senator Keeffe was not suggesting that the Minister was politically immoral in the sense that he was politically dishonest.

Senator MURPHY (New South WalesLeader of the Opposition) I regret that I was not present during the earlier proceedings; I came in only a little while ago. But I have endeavoured to obtain the drift of what occurred in the chamber so that I may assist you, Mr President, in this matter. It seems to me there is a difference of opinion as to whether the honourable senator, in making some remark, referred to the Government as doing something which was politically immoral or referred specifically to an individual - that is, the Minister - and accused the Minister of being politically immoral, which might involve a personal reflection upon the Minister. It would seem to me that if what the honourable senator intended to say was an allegation in general terms against the Government of political immorality, then that kind of thing is being said day by day.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– It is said by the public.

Senator MURPHY:

– Yes. From time to time these things are said and no-one takes them as a personal reflection against individual honesty. If it were a reflection against the individual personal honesty of a Minister, that would of course be a quite different matter and would not be permissible under the Standing Orders unless there was some substantive motion before the House. Perhaps the matter could be clarified rather than proceed further - I do not know. If the honourable senator would indicate that whatever word was used, if the understanding was that there was some accusation in general terms against governmental action rather than a reflection against the Minister in a personal way, then perhaps the matter might be brought to an end.

The PRESIDENT:

– Order! I have heard enough to indicate to me that there are 2 points of view: One, that the Government is immoral; the other that it was a personal reflection on the Minister in the terms conveyed to me by Senator Carrick who made the original objection and who noted the words of which he complains, namely, ‘that it would be politically immoral of the Minister’ to remain in charge of the Bill. I now turn to standing order 418 to which my attention was drawn by Senator Webster. Standing order 418 reads as follows:

No senator shall use offensive words against either House of Parliament or any Member of such House, or of any House of a State Parliament, or against any Statute, unless for the purpose of moving for its repeal, and all imputations of improper motives and all personal reflections on Members shall be considered highly disorderly.

– If it was not Senator Young it was someone with a foghorn voice like his.

– I would ask the Deputy Leader of the Opposition, Senator Willesee, not to try to make a fool of the Senate chamber.

Progress reported.

page 1264

QUESTION

STEEL PIPE CONTRACT

Formal Motion for the Adjournment

Debate resumed (vide page 1214).

Senator WRIGHT:
Minister for Works · Tasmania · LP

– This morning when moving for the adjournment of the Senate to debate a matter of urgency Senator Murphy advanced the proposition that the Government had failed to protect the employment and the industry of this country in respect of the commercial contract which the news media announced is about to be or has been concluded between the Australian Gas Light Co. and a Japanese company for the supply of steel for the South Australia-Sydney pipeline. Rising, as I do, after giving a few hours thought to this subject, I want to make it quite clear that the Government hoped that Australian industry would get part of the contract for the main trunk pipeline. Of course, we share the disappointment that apparently a foreign company has secured the contract for the supply of the whole pipeline. But I think it is acknowledged, although I hesitate to trespass upon the commercial area in this forum - it is so inexact and uninformed as to commercial details - that Australian industry is not equipped to undertake the . supply of the whole of the pipe for this pipeline.

Having said that, let me make it quite clear at the outset that I think it is curious that Senator Murphy, a week or so after the news with regard to this commercial contract has flashed out, should come into the Senate and move for the adjournment of the Senate to debate a matter of urgency. It has, 1 think, an atmosphere of opportunism - a purpose of expediency in the political sense. I do not think this is a serious approach to an importment matter, and I will say why. Senator Murphy developed his debate upon 2 considerations. The first was the employment potential and probabilities with regard to the actual contract for the pipeline. Then he turned aside to devote about two-thirds of his time to a proposition in which he urged the support of a federal body to govern the transmission interstate and, as I understood him, the operation both intrastate and interstate of gas and oil pipelines in Australia.

It is that latter aspect to which I wish to turn for the next 2 or 3 minutes, and then dismiss it. I dismiss it not because it lacks abiding interest. It is a matter of great importance, and it is because of its great national importance that I cannot think of any real purpose that would be served in dealing with it in the form of an urgency debate. This is a motion which requires debate without notice. The Senate adjourned the debate this morning and it is resumed now after a period of some 2 or 3 hours in the face of all the pressures of intervening business. I cannot think that the proposition that there should be a Federal governing authority with regard to the operation and construction of interstate pipelines can be usefully discussed at this time. I would think that that is a subject that should be set down by notice of motion and be called on for debate in order to give every honourable senator an opportunity to turn his mind to the subject and to give a good number of senators a chance to participate in the debate. In my view, a day’s duration for a debate on that subject would not be inappropriate.

Senator Murphy referred to various sections of the report of the Senate Select Committee on Off-Shore Petroleum Resources. It ls a report for which I have considerable respect and obviously one in which I have considerable interest, because I had the honour to move for the establishment of that Committee. What does the Committee say? Admittedly, it refers to the opinions of various authorities whose opinions are most valuable in regard to the proposition that there should be a Federal authority. The authorities referred to include Mr Hume, the General Manager of the Brisbane Gas Co. and the General Manager of the Australian Gas Light Co., I believe Sir William Pettingell. They put forward various opinions as did Sir Harold Ragatt and representatives of the Australian Council of Trade Unions. But after reciting all the opinions, the Committee sets forth a few paragraphs later:

That at present the Commonwealth has no power to enforce or to regulate the construction of pipelines within a State or to use the petroleum within a State, other than by indirect means. The Commonwealth has no power to enforce the construction of interstate pipelines, but can only exert its powers to control such pipelines if and when they are built.

The Committee then goes on to recommend the use of the constitutional machinery of an Interstate Commission which, it says, it might be desirable to set up with powers in this regard. I find that a very interesting proposition and therefore one to which I would like to give proper debate. Then there is the third point that Senator Murphy’s outlook on this matter seems to overlook idly, and that is the viewpoint of the States. We know that under the present constitutional arrangements the States are very jealous of the powers they have in this regard. What we as practical men should be debating tonight is the situation of the South Australia-Sydney pipeline and not debate on the assumption that the States will agree to surrender powers or that by some referendum the Commonwealth powers will be enhanced. We should be debating on the practical basis of today’s incongruous Constitution. I part from this aspect of the matter by simply reminding the Senate that I believe New South Wales resorted to South Australia as a source of this gas because of the price required by her neighbour, Victoria, for gas ex BHP, Bass Strait. I am told that it is claimed by New South Wales that she made a saving of $150m by avoiding a transaction with Victoria and effecting it with South Australia. I mention that because it enters into the consideration of how we can expect the States to make agreements today. I leave aside this major question of policy, which cannot be discussed adequately in a debate on a motion such as this, and turn to the commercial fact of this pipeline contract involving as it does, we are told, a price of $54m and providing for a pipeline of approximately 760 miles in length with a pipe diameter of 34 inches, for at least part of the route. The first thing I want to say about that is that Senator Murphy has moved this motion today in the wake of an announcement last week that if the proposed contract between the Australian Gas Light Co. and the Japanese companies goes ahead a ban would be placed upon the work by trade unions. I believe that this motion is calculated to fan the flames of that discontent in the industrial sense. I believe that it is unfortunate that Senator Murphy can put himself in the position of supporting a viewpoint that has the purpose of paralysing all the potential elements of this proposal.

Senator James McClelland:
NEW SOUTH WALES · ALP

– Senator Cotton did not agree with you. He said that the Government would listen very seriously to the thoughts of Mr Short on this matter.

Senator WRIGHT:

– Of course, the Government always listens to the thoughts of Mr Short upon this matter. But listening to does not mean complete acceptance, and Mr Short is in the position of being the leader of one union amongst others. Therefore, to some extent he is bound by them. What I want to point out is that it is inescapable that the whole policy of Labor has been developed to point up its purpose - that if it were to attain government it would be a government dominated by unions for the purpose of unions. That wants to be steadily borne in mind. When we are faced with an accusation that the Government has failed to protect employment in this country in this respect, I ask honourable senators to bear these matters in mind: Firstly, the Broken Hill Pty Co. Ltd has said that there is no likelihood of a reduction of its employment by reason of this matter. Secondly, Tubemakers of Australia Ltd, which would be expected to participate in the pipeline construction, has said that it has not the plant capacity geared to the situation and that fabrication of pipeline of the diameter referred to would be achieved by tooling up the factory at present not in operation. That would take some 6 months and possibly it would provide employment for 250 men. It is that employment potential which we all would like to see utilised in this country but at the present time there is no such employment group.

When the unions come forward and say that the Government should arrange for the contract to be given to an Australian company in order to gain that employment potential, which, as I say, would give employment to about 250 men for some two or three years I believe, the first thing we must take note of is that, if the Government does not do so, they simply would destroy the opportunity of working on the construction of the pipeline. I believe work on the construction of the pipeline would be infinitely more rewarding to workmen than work in the pipe factory.

It is incongruous to have this proposition asserted in the present circumstances when one remembers that last year within BHP alone there was a loss of some 986,000 man hours because of strikes. We must realise that the BHP vessel ‘Iron Somersby’ was immobilised for ever 4 months at Port Kembla after its maiden voyage because of bans imposed by the maritime unions. Then we must remember along with those facts that the recent oil strike damaged BHP and caused it a loss, according to its report, of some $ 1 2m to SI 3m. lt also did damage to the joint venture of Esso-BHP amounting to $24m to $26m. When we consider these facts we can put into perspective the attitude of the trade unions in regard to this matter of the manufacture of steel pipes. That is an attitude - one which Senator Murphy come here to support - of damaging assets and damaging work potential far in excess of the potential involved in this particular contract. It needs to be understood that, if we are going to have a prosperous trade union movement and if we are going to maintain employment with sound operating companies, we must have a policy on the part of the trade unions which will ensure a continuity of work on a responsible basis.

So I find myself deeply -disappointed about the attitude adopted by the trade unions and about a possible ban upon the work because this would deprive so many unions and unionists of the construction work involved. That illustrates the reckless approach of the unions over the last year to this and the allied industry of simply resorting to strike action instead of settling disputes without disruption of work by going to the independent arbitrator.

– If we compare America it should be on the other basis. However, $ 1,060m of Japanese money coming into this country means increased work on our iron ore fields, increased income to our wool growers and increased income to all our other exporters. I point out that $ 1,0:60m is $l,060m. The other figure is resorted to only because merchants always regard it as requisite to have a little give and take in trade. We will not maintain that market for wool and iron ore unless we provide some access for Japanese imports. Do not think that Australia is Father Christmas because it allows imports worth $400m. For the most part we impose a duty on those imports of some 30 per cent or 35 per cent. Anybody who is conscious of the facts knows that the slight recession last year in the Japanese economy tightened up iron ore exports and tightened up the wool market, and that it was a pretty potent factor in creating the cold breeze that hit Australia and made the employment situation less buoyant than it was.

We cannot maintain this economy unless we maintain successful trading units within it which can employ people throughout the whole range of employment. Unless we maintain that international trade on a basis in which, thankfully, we have a great advantage at present we risk reducing the employment potential that iron ore exporters and wool growers can give. Those considerations induce me to think that the Government has afforded ample protection to employment. The Government has maintained a pretty high wall for the protection of local industry, the reduction of which Labor has incessantly advocated over recent months. Labor goes to the consumers and says that one means by which it will keep prices down will be to reduce the tariff. We have maintained that we have the tariff, which is protective of Australian secondary industry, on a basis that behind it are run economic and effective businesses.

There is provision that if goods reasonably suitable for the pipeline are not reasonably available in Australia the Minister has the authority to adjust, reduce or remove the tariff - I am not sure which - so as to facilitate the entry into Australia of goods which otherwise would not be allowed to compete with suitably equivalent goods made in Australia, except on the basis of duty being paid on them. As recently as yesterday the Minister for Trade and Industry (Mr Anthony) said that he had maintained within his Department the Office of Secondary Industry which has maintained a liaison between the Australian Gas Light Co. and the Australian companies that might be suppliers of the type of equipment necessary for the construction of this pipeline and the distribution lines. The Minister said:

Our efforts have been to see that the Australian companies were given an opportunity to tender for the work that was to be carried out. My Department has been told by AGL that it provided the necessary specifications for Australian firms to tender but they have not been able to fulfil the specifications required.

The Government has constructed a policy of protection of Australian industry, it has constructed a policy of expanding Pacific trade, it has endeavoured to combat unio.i disruption which damages employment personnel, and in addition it is constantly watching the situation in various departments of government so as to ensure that the hope that we now maintain will be fulfilled and that, with a bit of give and take and a bit of adjustment, it will lead >o the conclusion of commercial arrangements which will enable a satisfactory part of the pipeline contract to come to Australian companies. I submit, therefore that the the proposition in Senator Murphy’s motion, that we have failed to protect the industry and employment of Australia, completely fails.

Senator LITTLE:
Victoria

– The matter of urgency which has been proposed by the Australian Labor Party is not one which the Australian Democratic Labor Party can support. We had expected that if a move of this character was to be made there would have been a far more worthwhile motion containing some positive propositions which could have enabled some action to be taken to clarify the situation. However, what we have before us is a political statement which is merely a criticism of the Government. One cannot help thinking that on the eve of an election it is an attempt to make political capital from an incident that has occurred and that if this situation had not arisen we would not have heard anything of the matters contained in the Labor Party’s resolution. The Labor Party would not have been concerned about the employment of the people if that matter had not suddenly been drawn to its attention. I think the whole proposition goes much further than that and 1 propose to develop that suggestion in the course of my remarks. First 1 shall deal with some of the suggestions that were made by the Minister for Works (Senator Wright).

The stand which has been adopted in this case frankly surprises me. There is a responsibility on the Federal Government of Australia in the matter of trade, irrespective of what is the situation between the States. We accept that trade is a highly controversial matter between the States because they are rivals for trade. Different States want to sell gas and the Australian Gas Light Co. in Sydney will be the buyer. It is natural that there should be State rivalries in supplying that market. A solution to this problem which would be popular in one State would not necessarily be popular in another State, nor can we expect there to be complete co-operation between the States throughout the whole of Australia. If we accept this we begin to wonder why the proposal of the Australian Labor Party is so innocuous. Is it the position that the Premier of South Australia is very keen to sell the gas and, being of the same political complexion, for this reason the resolution has been broken down to the innocuous proposition which has been brought into the Senate today? One could gain that impression from what one reads in the newspapers.

One can come to no other conclusion, perhaps, than that the Australian Labor Party does not care where the pipe comes from, so long as South Australia can sell its gas to Sydney. As a short-range policy that might be a quite justifiable attitude for the South Australian Premier to take. There are other people in Australia today who, like the Minister for Works, suggest that because of our terms of trade Japan may not trade with us in wool and iron unless we take from Japan things such as the pipe which is the subject of this contract. I do not accept that suggestion. I have made a study of the Japanese economy and Japan’s situation. Japan is very dependent upon primary materials, some of which it can obtain from Australia only and others which it can obtain not so exclusively from Australia but more conveniently from this part - of the world because it fits in with the trading policies that she has developed.

When Japan has such a favourable balance of trade with many of the great trading powers she is not concerned about an unfavourable trade balance which she realises that she must maintain with a country so numerically small as Australia. In her own interests, in the interests of her manufacturers of textiles, fabrics or other products, she will pressure Australia to take more, but she will not be offended by the terms of trade to such an extent that she will refuse to buy from us the raw materials in relation to which at the moment she is able to conduct a massive economic drive throughout the whole world. So long as she is able to get iron ore from Australia so that she can build the huge tankers of 100,000 tons which she sells to Greek shipping merchants and others in order to boost her economy she will not refuse to buy that iron ore merely because Australia has an unfavourable trading balance. I reject that argument in its entirety as being irrelevant.

Senator Georges:

– They will be buying it from China tomorrow.

Senator LITTLE:

– I warn Senator Georges who is interjecting-

Senator Georges:

– You are so shortsighted that you do not realise what is happening.

Senator LITTLE:

– Senator Georges has just anticipated my warning. I hear members of his Party time and again in this place asking why we are not trading more with China and why we have not people stationed there making representations on our behalf. At this very moment Mr Tanaka is in China. Those people who suggest that, because this contract for steel piping has been let to Japan, automatically it will be Australian iron ore that will be come back in the form of pipes might be anticipating a situation that will not develop. The pipes might be made from China’s iron ore. Those people who have been roaming this chamber for a long time screaming that Australia should conduct more trade with China might find that one of the very favourable markets that we have developed in the Pacific is related to the buying of pipes from Japan and that we do not have so much trade for China.

The pipeline in question is very much open to debate. There is no certainty at this point of time that the pipeline will ever be required or that anybody will ever manufacture pipes for it. Yet the Australian Labor Party, in its urgency motion, wants to condemn the Government for creating unemployment. The facts are that the contract that has been signed is dependent upon the proving of the reserves, to start with, and that the supplying company is composed of the Burmah and Santos companies and a smaller American company called Delhi International Oil Corporation which has not approved the contract into which its partners have entered, and does not want to approve it, because it says that the price is too low and it fears that there are insufficient reserves. Some experts have said that there are insufficient reserves; some have said that there are sufficient reserves.

Senator O’BYRNE:
TASMANIA · ALP

– Whose gas is it?

Senator LITTLE:

– Never mind about whose gas it is. The honourable senator can put that stupid line if he likes. I am dealing not with his imaginative wanderings but with the facts. The facts are that, as far as these companies are concerned, it is their gas because they have leases over the area which governments of this country have properly given them and they have invested capital to develop them. So, they are the ones who will sell or not sell the gas. The South Australian Government - Senator O’Byrne should know something about this - will reap some of the harvest in the form of the profits that come from the gas because a royalty has to be paid to it.

The point I am making is that the Delhi company, which is a very interested party in the combination of companies that controls the oil and gas, has not signified its intention to be a party to the contract. It says that, even if the reserves are sufficient, it doubts whether the companies have the capital to develop the reserves in order to supply the gas. Yet the Labor Party comes along with an urgency motion that says that inside 3 or 4 days the Government has created unemployment. That is not the Democratic Labor Party’s attitude. We believe that this incident has revealed the very urgent necessity for consideration of the matter by the Australian people.

It is not a fact that the Australian companies concerned have been given the right opportunities to tender for the pipes. 1 refer to a statement that was issued by Tubemakers of Australia Ltd and reported in the Press in these terms:

Tubemakers said in its statement on Friday: The pipe sizes specified by AGL were 30-inch and 36-inch, the quantities being approximately 700 miles of 30-inch and 87 miles of 36-inch.

Tubemakers of Australia says that it was never informed that the requirement was for 34-inch pipes and that what it tendered for was the supply of 30-inch pipes because that was the specification. It claims, as reported in this article which was published in the ‘Australian Financial Review’ last Friday or Saturday, that it was never asked to tender for the size of pipe for which it is alleged a contract is being negotiated and therefore was unable to submit a tender for it.

In spite of the Minister’s statement and in spite of the wild speech which we heard from Senator Murphy and which meant nothing at all except that the Labor Party was saying that the members of the Gov- ernment were a Jot of naughty boys, we have to consider the fact that the Government has some control over this situation because this pipe is subject to a 35 per cent duty. If it cannot be made in Australia, because of the nature of the contract and the need for the development of this country there could be some justification for a remission of that duty so that Sydney consumers of gas would not have to pay a higher price to cover the cost of the duty that is payable on the pipe. If the pipe can be produced in this country, I doubt that the Government has the same right to remit the duty that is payable on the pipe. It is obvious from the statements made by the Australian companies that could tender that they could not supply all of the pipe that will be needed. The Minister is right in that assertion. Therefore the Government will be faced at some lime, if this project comes to fruition, with considering whether it will remit the duty on the whole of the contract or on a part of the contract, and that must inevitably cause a reconsideration of tenders from Australian companies because if the duty is not remitted it will add enormously to the cost of the pipeline, which will be increased by more than one-third.

The Democratic Labor Party has given this matter very serious consideration. Tomorrow we will give notice that on the next day of sitting of the Senate we will move that the following matter be referred to the Senate Standing Committee on Industry and Trade:

The report that the Australian Gas Light Co. is proposing to conclude a contract with a Japanese corporation for the manufacture and supply of steel pipes for the proposed natural gas pipeline from Moomba natural gas field in South Australia to Sydney, which would deny Australian steel producers and suppliers the opportunity to fabricate and supply the required steel or any part of it.

The Democratic Labor Party believes that it would require very strong evidence indeed to justify handing over the whole of a contract of this magnitude, relating to Australia’s fuel resources, to a wholly overseas company. We propose to take that positive action so that a full inquiry can be made into all aspects of this matter, ls Tubemakers of Australia right when it says that it was not given the size of the pipe correctly; that it was given 30 inches and 36 inches as the sizes of the pipe and now the contract is alleged to be for 34-inch pipe all the way? Is it a fact that the contract for the supply of gas is under as many shadows as it seems to be from the newspaper reports we have had of the disputations between the companies controlling the Moomba basin? I believe that all these matters have to be taken into consideration before a real decision can be made on the question.

This highlights the need for Australians to begin to realise that, on a State basis, this area could be very competitive. The question could arise whether Victoria, South Australia or somebody else would gain a massive contract to supply Sydney. In America today many areas are running out of supplies of this very commodity, lt may well be doubtful whether it is a very good idea for South Australia to be entering into a contract of this magnitude, which may denude that State of potential for industrial development by the use of cheap fuel, merely to supply Sydney which might be able to obtain supplies from somewhere else. Where is the policy of decentralisation in that? If it is necessary to prove the reserves and they are in so much doubt, it would appear that it is lime we had an overall authority to investigate and study the whole matter in the interests of Australia as a whole. Already we are receiving warnings from experts who claim that Australia would be foolish to engage in the over-export of this type of fuel and denude the ability of its industries at some future stage to compete on world markets for the products that can flow from an industry of this nature.

I know that my time is short; I have only 15 minutes in which to make this speech. I conclude by reminding the Senate of the constructive action that we suggest in the motion of which we will give notice tomorrow and which I have already read to the Senate. It is a constructive action that will enable the making of a full inquiry designed to ascertain the facts. It will not be a rushed action designed to gain a few lousy votes in an election by condemning the Government over something which it has not yet had time to consider. I hope that when the Government considers this problem in depth it will come down with solutions that will be in the interests of Australian industry and the employment of

Australian men. I hope that it will not run away with the idea that Japan is buying iron ore from us because she has to.

The PRESIDENT:

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

Senator O’BYRNE:
Tasmania

– It indicates the cynicism of the Australian Democratic Labor Party and the way this Parliament has been degraded by the presence of its members here that they pose as being on the Opposition side and take their turn in the debate as being in Opposition when on every occasion they stand up and support the Government policy. I believe that they have the audacity and temerity to parade in front of this Parliament and in front of the people of Australia that they are Opposition. We know very well where their interests are. The Democratic Labor Party has given notice of intention to propose a motion, which has been read to us, although the Australian Labor Party specifically has said that the Government has failed to take action to protect Australian employment and industry in respect of the supply of the Moomba-Sydney pipeline.

The Democratic Labor Party talks about having a full inquiry by the Standing Committee on Trade and Industry in order to get the full facts. The Senate Select Committee on Off-shore Petroleum Resources examined this matter for 3 years. We knew that the situation would arise. But in making those points I just wanted to dismiss the meanderings of the previous speaker. I want to ask the Minister for Works (Senator Wright) what he himself is doing. Today he asked for time to enable him to get answers to our proposition. He said that notice was given by Senator Murphy of his intention to debate this matter only a few minutes before the Senate met this morning, and he wanted an interval of some hours to enable himself to get some background information. But what the Minister came up with was a lot of incoherent rhetoric and he failed to show any proof that the Government had taken any action to protect Australian employment and industry in the supply of the MoombaSydney pipeline.

The Minister has performed a complete somersault. I remember quite well the occasion when the Minister was a back bencher. Before dinner he put up a very strong case about the oil industry, the discovery of Bass Strait oil, the CommonwealthState agreement and all the other legislation that followed from the secret agreements that were made by the late Prime Minister, Mr Harold Holt, and Henry Bolte, the old stager from Victoria, in concert with the biggest oil monopoly in the world today. We knew very well that these secret agreements were made. However, Senator Wright, in all his righteousness, took exception to it. However, it took the dinner period for him to change his mind. Senator Wright had a committee set up to investigate the oil industry, and it took the Committee a number of years to investigate it. He was the first chairman of the Committee. He was very promptly given a portfolio which removed him from the area of being a critic to becoming a supporter of this whole racket that is being sold to the Australian people.

– This is the important point. The Victorian Government insisted that New South Wales had to buy gas at this excessive price. The Australian Gas Light Co. said that it just could not impose this price on the New South Wales people. It said: “You might be mugs in Victoria but we are not going to fall for the same confidence trick in New South Wales’. The Australian Gas Light Co. then made other arrangements with the people in South Australia at Moomba-Gidgealpa to see whether they could prove their resources there. These resources gradually have been proved. The discovery of new resources there, which was announced yesterday, has made possible the continuity of supply to New South Wales, the biggest area for the consumption of natural gas in Australia.

The pipeline that will be built to connect the South Australian field to New South Wales has been made necessary through no fault of the New South Wales people. Because of a cunning type of business arrangement and the activities of Victoria the people of New South Wales will have to build a 760-mile pipeline to bring gas to Sydney. It is here that revenue is coming in. I would like to quote from an article which appeared in a newspaper. It stated:

Esso-BHP regarded the Victorian level as the minimum acceptable, however, and were also bound to lower the price to Victorian distributors under their Victorian agreements if they sold Bass Strait gas cheaper elsewhere.

The sudden spurt of discoveries in mid-1970 which turned the Cooper Basin into a likely major gas field, led AGL to switch its gas negotiations instead to the group of companies around Santos Ltd, Delhi International Oil Co. and Burmah Oil.

A deal was agreed on last year, pending the Burmah-oriented group proving up a minimum of 2 trillion cubic feet of recoverable reserves.

The deadline for this has been extended 3 times and is now expected next month, as the Burmah group have run into a variety of difficulties - including last year’s floods . . .

The whole episode has led to extremely bad feelings between Esso-BHP-AGL.

Herein lies the problem which we are discussing. Because of this jealousy and bitterness which has developed, AGL is displacing BHP which has an interest in oil and steel and AGL is giving the contract to a Japanese company.

Senator James McClelland:
NEW SOUTH WALES · ALP

– The negro in the woodpile.

Senator O’BYRNE:

– Absolutely; that is well expressed - the negro in the woodpile. Our Australian workers could be employed in an industry which is quite capable of producing 30-inch, 34-inch or whatever diameter pipeline and could be tooled up in sufficient time if there were a policy along those lines to supply this pipeline. In Queensland BHP has been able to supply the pipeline from Roma down to Brisbane. It has been able to supply the pipeline from Bass Strait across to its refineries in Victoria. The pipeline has been supplied by BHP from Dongara to Perth in Western Australia. Just because of pique and spite between these 2 giant companies we are losing this contract.

It is my belief that this is the responsibility of the Australian Government which has authority and must assume authority over these matters, even though it has been able to pass the buck in the CommonwealthState agreement regarding off-shore licences and the many other anomalies in this oil industry setup. But it has a responsibility here to see not only that we retain the fullest interest in our natural resources but also that whatever benefit comes from them should flow to the Australian people. The pipeline system eventually will tie up the area at Mereenie in Palm Valley in the centre of Australia, the Moomba-Gidgealpa area and the north-west shelf area, like a railroad system or any other system of transportation. I am given to understand that this could mean between 10,000 and 15,000 miles of pipeline. Does the Government mean to say that when the first crisis comes and Tubemakers of Australia Ltd are temporarily unable to quote for this contract because of a sudden change in the diameter of the pipes which are required it can be deprived of the potential that it should have here as an Australian company, employing Australian labour. It should be able to quote for this vast projected pipeline concept which we have in front of us.

Senator Wright:

– Part of it is in British shareholding, is it not?

Senator O’BYRNE:

– I am not certain of the shareholding of Tubemakers or of BHP. I understand that Tubemakers is a subsidiary of BHP. I do not know what the shareholding of BHP is, except that it is reputedly an Australian company.

Senator James McClelland:
NEW SOUTH WALES · ALP

– There is no doubt about the shareholding of the Japan ese company.

Senator O’BYRNE:

– There is no doubt whatever that there are no Australian shareholders in the Japanese company. Not only is there a lack of Australian shareholders but also there is the principle of displacement of the potential for Australian industry. We are just in the teething stages or becoming an industrial nation. We are fortunate enough to have found these new natural resources. We see them obviously fading away from us because ownership of the gas resources are in the hands of people in Dallas, Texas, 10.000 miles away. The direction of the policy as to where our fuel goes is in the hands of overseas people. To me this is intolerable. It is intolerable that any government should allow this to happen. But then we come around to the real facts of life. We are supplying our iron ore to Japan which is sending it back here and displacing Australian workers. This is absolutely terrible.

The PRESIDENT:

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

Senator WEBSTER:
Victoria

– The urgency motion brought forward by the Australian Labor Party is certainly, as it was previously described, quite hollow. The attitude of Labor in attempting to chase this matter is completely false. The Minister well described the attitude of Labor and the unions to attempting to maintain employment in this country. The Leader of the Opposition in the Senate (Senator Murphy) has sufficient commercial intelligence to know the effect of the attitude of his own party at this time in relation to tariff protection which is surely at the heart of this argument. The attitude of the Labor Party in relation to devaluation of the Australian dollar is well known in the community. It is completely hollow for honourable senators opposite to stand here and say that they have a great interest in seeing that benefit is secured for an Australian manufacturer. On 27th August this year when the Leader of the Opposition in the other place (Mr Whitlam) was being asked on an Australian Broadcasting Commission programme about inflation he said:

Yes, 1 agree with that entirely. I think the Australian dollar is under valued. . . .

Senator Jessop:

– Who said that?

Senator WEBSTER:

– Mr Whitlam said that. That is a reflection to which manufacturers in this country can give attention. In the same context on the same programme Mr Whitlam said:

In general terms, yes, I do believe that tariffs in Australia in general terms are too high.

Here we have the declaration of the Opposition as to what it really feels about protection of Australian industries. This matter is of great importance. We should feel particularly proud that an Australian company such as the Australian Gas Light Co. can be considered or can consider itself of such enormous commercial significance that it is entitled to enter into a proposition where so many millions of dollars will be spent in the Australian national interest of supplying fuel to the Sydney and New South Wales market. I consider that any action which we take in this Senate should not detract from the free ability of any commercial enterprise in Australia to buy from Australian sources should it so desire, or from overseas sources should it find that commercially more viable, so long as it has some reference to the laws which exist in Australia and so long as every opportunity is given to Australian manufacturers to enter reasonable competition for supply of the goods required. I believe that would be in line with what the Australian Gas Light Co. ownership would desire. By direction I seek leave to continue my remarks later.

Leave granted; debate adjourned.

page 1274

HIJACKING OF AIRCRAFT

Ministerial Statement

Senator COTTON:
New South WalesMinister for Civil Aviation · LP

– by leave - I think my colleagues are entitled to have as soon as I have it information about the hijacking of an aircraft today. This incident has been a great worry. It was suspected from the time when we received a report that this could be a hijacking incident. We have treated it accordingly. We have been tracking the aircraft all the way through. It landed in Singapore at about 8.55 or 8.56 p.m. Our latest information on the open line is that all the passengers are off except one who, we are informed, has a hostage on board. All the crew are off except that one hostage. The captain has been talking on the ground to the Director-General of Civil Aviation in Singapore who is well known lo us. Our open line is open. At the moment we have some reservations about the situation.

page 1274

QUESTION

STEEL PIPE CONTRACT

Formal Motion for the Adjournment

Debate resumed.

Senator WEBSTER:
Victoria

– Prior to the interruption, I was saying that I think all Australians can feel particularly proud that a company such as the Australian Gas Light Co. has the capacity in direction, in management and in financial standing to be able to enter into work to this extent. On the overall basis the total value of the work could, in the end, be approximately $250m. Even if the Australian manufacturers were to lose the particular section of the contract to which we are referring and it then were given the opportunity to supply the smaller lines that will go into various areas, the content of Australian supplies in this case would be over 60 per cent of the work. That gives us some reason perhaps to consider a proposition whereby all concerned in commercial opportunities should be given a fair opportunity to quote for this work.

Earlier this year 1 alerted the Minister for Trade and Industry (Mr Anthony) to consternation that existed amongst Australian manufacturers. In late April this year I took to the Minister for Trade and Industry certain queries relating to specification, size of pipeline and delivery times which, at that stage, were exercising very greatly the minds of Australian manufacturers. The Minister replied to me in this fashion: He gave me a note to say that earlier in this year liaison was established with the Australian Gas Light Co. to ensure that Australian industry was being given full opportunity to bid for the supply of material for the project. Senior representatives of the Australian Gas Light Co. indicated that this was the case and that full details of all technical specifications were being given to potential Australian suppliers.

I alerted the Minister. I believe it is from my actions that he has had his Department take a commercial and a governmental interest in this matter. It is difficult for his Department ever to interfere or take notice of contracts such as this, unless they are alerted by members of Parliament. The problem at that time was that Australian industry was aware that contract specifications had been given to overseas tenderers and that final specifications were not in the hands of Australian manufacturers.

I was somewhat disappointed, if I may say so through you, Mr Acting Deputy President, that the Minister was not able to bring this information before the Senate. One is inclined to consider what the Australian Democratic Labor Party suggests, which is, that this contract requires further investigation, if the Department of Trade and Industry is not able to have the facts before it at this time. I believe that it should.

On 20th September this year, prior to any notification being given that a contract had been let, I again alerted the Minister by question in this Senate to the fact that there was a possibility that Australian manufacturers had not seen the complete specification nor knew the correct size of pipe to be used. I seek leave, Mr Acting Deputy President, to incorporate in Hansard 3 questions which I raised on 20th and 21st September and the answers thereto.

The ACTING DEPUTY PRESIDENT (Senator Lawrie) - Order! Is leave granted? There being no objection, leave is granted. (The documents read as follows) -

STEEL PIPE

– This matter breaks into a number of areas. Australia has the potential to manufacture this pipe. That is established. It was mentioned by an earlier speaker that Australia had supplied pipe to various areas. That is so. I was disappointed that the Minister could not find information on which to advise me that there were manufacturers, other than Tubemakers of Australia Ltd. There are 2 major manufacturers of steel pipe of this grade in Australia. One is Tubmakers of Australia Ltd which, for the interest of the Senate, is owned 50 per cent by Broken Hill Pty Co. Ltd plus a public shareholding, with the other 50 per cent held by the British Steel Corporation and Tube Investments Ltd. The other substantial steel pipe manufacturer in Australia is Steel Mains Pty Ltd, which is owned 50 per cent by Tubermakers of Australia Ltd and 50 per cent by Humes Ltd, which is a totally owned Australian corporation. The fact that Australian industry can supply this pipe is undoubted. In respect of the Bass Strait contract, 2 major volumes of Australian produced pipe of the diameter of 42 inches, 38 inches, 36 inches and 30 inches but not of 34 inches were supplied. 1 am surprised this information showing that Australia has the capacity to produce this pipe is not available. Newspaper publicity would give one the opposite view.

The Australian industry has had scarcely sufficient specification on which to quote at any stage. I wish to read from a document, which is now in the hands of the Department of Customs and Excise, a statement by one of the manufacturers.I shall ask for leave to incorporate portion of this document in Hansard. The relevant section is approximately one foolscap page, from which I will read a paragraph. This section is entitled ‘Comments on Tender Documents’. The relevant paragraph reads:

The documents issued by Williams Bros. - CMPS are marked ‘Preliminary’. They are not dated. They are not in consecutively numbered pages. Some paragraphs are crossed out by hand. There are no General Conditions, so that tenderers do not know what is required with regard to Terms of Payment, delivery periods, who is the purchaser and hence who undertakes to pay for the good’s supplied. There is no clearly identified date of tender call, nor of a proper closing date for the tender. Several attachments are mentioned in the Specification, but are not attached, so that tenderers cannot judge their significance or content. The Specification is not bound, so that loose pages can be lost or added, without any form of control. 1 now ask for leave to incorporate the section that I have mentioned.

The ACTING DEPUTY PRESIDENT (Senator Lawrie) - Order! Will the honourable senior supply the matter to be incorporated?

Senator WEBSTER:

– I have shown it already to the President. He told me to produce it in the Senate and that would be it.

Senator Keeffe:

– What is in it?

Senator WEBSTER:

– I ask Senator Keeffe not to interrupt me, please. 1 asked the President about this incorporation and he said that if I indicated in the Senate what was in it I would get approval to incorporate it. I would appreciate it if Senator Keeffe would not interrupt me as I have little time in which to deal with this big subject. I ask for leave to incorporate the document.

The ACTING DEPUTY PRESIDENT (Senator Lawrie) - Order! Is leave granted? There being no objection, leave is granted. (The document read as follows) -

Comments on tender documents (Attachment IV)

Most organisations when calling public tenders for works of some magnitude, establish a proper administrative procedure, for their own protection as well as that of tenderers. One of the most elementary steps is to issue a proper description of the General Conditions of tender, a proper specification of the work to bc done, and a full set of appendices where the specification refers to the existence of such appendices.

The documents issued by Williams Bros- CMPS are marked ‘Preliminary’. They are not dated. They are not in consecutively numbered pages. Some paragraphs are crossed out by hand. There are no General Conditions, so that tenderers do not know what is required with regard to Terms of Payment, delivery periods, who is the purchaser and hence who undertakes to pay for the goods supplied. There is no clearly identified date of tender call, nor of a proper closing date for the tender. Several attachments are mentioned in the Specification, but are not attached, so that tenderers cannot judge their significance or content. The Specification is not bound, so that loose pages can be lost or added, without any form of control.

It must be stressed that this unconventional method of documentation makes it possible for different suppliers to receive different tender documents, either by mistake or intentionally. There is no guarantee whatever that the overseas suppliers have been asked to tender for the same Specification as the Australian pipe makers.

With regard to delivery requirements there is no mention anywhere in the Specification. In early discussions (prior to March 1972) the clients had indicated they were thinking in the order of 8 to 10 months from date of order to final delivery. As it would require 2 to 3 months from date of order to receipt of the first shipments of steel plate, this would have left only about 6 months actual manufacture time. In th: ‘Tentative Project Schedule’ (see Attachment II) this delivery period has been extended to 3 months lead time plus 11 months production, giving 14 months from date of order to final delivery.

Even this ‘extended’ delivery period would only allow the Australian industry to supply about 50 per cent of the pipes needed. It is important to note that any further extension of time adds more than pro-rata to the quantity which local pipe makers can make. Steel Mains offered to make about 84 miles in 14 months, or an average of 6 miles/month for the period. But in a further 4 months it could make 32 miles, or 8 miles/month. Assuming TOA’s output ls about 4 times as great, the total local content would then be closer to 75 per cent of the project.

The significance of this point is that there is a legitimate question with regard to client’s ability to use the products within the specified period This ability does not depend on the number of pipe-laying ‘spreads’ which can be brought into the country, but on the number of competent qualified welders available in Australia. Past Australian experience on major pipeline construction would appear to indicate this to be the real determining factor. It cannot be ignored that simultaneously with the construction of the trunk main there will be other spreads engaged on the laterals (e.g. to Newcastle and Wollongong) on the construction of the gathering lines in the field, and large numbers of welders would work on the upgrading of the gas distribution system in Sydney and on the process plants at Gidgealpa.

We do not claim any expert knowledge in the construction of natural gas pipeline systems, to express an opinion on the timing of the project. However, it appears lo us that sufficient grounds would exist to warrant a thorough questioning on this point.

What a stupid comment. The tariff is not an innovation. It has existed for decades. The manufacture of steel pipe in Australia was looked at by the Tariff Board in 1965- 1966. and has been considered in subsequent years. The Tariff Board found Australian manufacturers to be most efficient, economical and worthy of sustaining.

My main concern is that what has been done is in accordance with law. I believe that the principal to this contract should be able to buy in Australia or overseas, whichever he prefers. The ability of Australian industry to supply is dealt with in item 19 of the customs tariff which refers to a suitable equivalent not reasonably being available in Australia. Those words must be adhered to. 1 ask the Minister, firstly, to verify the date on which the Australian steel suppliers and the pipe manufacturers received a complete and detailed final specification. Secondly, what was the date on which the Australian pipe manufacturers received information that the main body of pipe was to be 34-inch? It is known that the Australian pipe manufacturers learned that it was to be a 34- inch pipe on 21st September 1972 at a meeting held in the Department of Customs and Excise at which all parties to this agreement were present. I tell the Minister that while I believe that this great Australian company, the Australian Gas Light Co., should be permitted to buy wherever it desires - that it should have this freedom - nevertheless in this case it appears to me quite strongly that Australian industry was not given sufficient and appropriate specification upon which to quote.

Senator KEEFFE:
Queensland

– 1 rise to support the matter of urgency raised by the Leader of the Labor Party in the Senate. I requote the words for the benefit of those who may have joined the radio- audience:

The failure of the Government to take action to protect Australian employment and industry in the supply of the Moomba-Sydney pipeline.

Before proceeding to the general terms of the debate I would like to pass a couple of remarks on the contribution which has just been made by Senator Webster of the Australian Country Party, It is indeed refreshing to hear a member of the Country Party suggest that Australian industry and Australian employees ought to be looked after. In the main members of his Party, like members of the Government, usually pay all due respect to overseas organisations when it comes to large amounts of profit.

Senator Webster:

– That is a lot of rubbish - the kind you usually talk.

Senator KEEFFE:

– That is an interesting interjection. I was going to refrain from saying this, but I recall that the honourable senator opened his remarks by criticising the Leader of the Federal Parliamentary Labor Party and the Leader of Her Majesty’s Opposition about alleged remarks concerning revaluation of the currency. I would remind the good senator that not very many weeks ago senior Ministers of the Government were negotiating a revaluation of the currency. So let us not argue the point about that either. I think the onus is now squarely on the Minister to state all the facts relating to the granting of this $54m contract to an overseas firm. It is amazing, when the Opposition raises subjects of this nature in this chamber, to see the unwillingness that is always shown by most Government Ministers to disclose all the facts of the case. Tonight the challenge to put all the facts of the case on the table has come not only from my own Party but has been endorsed by the junior coalition partner. Was it true that the specifications for this pipeline were not set out clearly as being 34-inch pipe? Or was it 36-inch pipe- and now we find the contract is for 34-inch pipe? As the Leader of the Labor Party in this chamber said when he opened his remarks tonight ‘It’s time’. It is not only time that the Government was changed; it is time that half the Ministry resigned; starting with the Prime Minister and working either up or down depending on one’s view of the Government.

It is significant that not only has this developed into a major scandal but that we can look back at other scandals also. Earlier today papers were tabled in the Senate in relation to the Jetair affair which will get a better airing - no pun intended - at a later stage in this session. We have had another scandal raised from this side of the chamber concerning the possible misuse again of VIP aircraft. We lost trade with China because the Prime Minister and other senior Cabinet Ministers decided that we did not need the trade. We have had the scandal raised in both Houses of the

Parliament of the preferential treatment given to Ministers for the occupation of government homes in Canberra. We have had the problem of the Ustasha, though not so many days ago the AttorneyGeneral denied that there were any such problems. Now we have the pipeline scandal in addition to all the others. Perhaps a lot of this failure starts right at the top with the Prime Minister who not so many months ago thought he had written a letter to the Prime Minister of South Africa and then discovered that he had not written it.

The ACTING DEPUTY PRESIDENT (Senator Lawrie) - Senator Keeffe,I suggest you keep to the resolution.

Senator KEEFFE:

– I am keeping to the resolution. I am trying to point out the facts behind what appears likely to develop into a further scandal so far as the actions of this Government are concerned. The instances I am quoting highlight the fact that everything that the Prime Minister or his senior Ministers touch turns to dust, and the pipeline is no exception. I recall a further incident in which the Prime Minister thought he had written a letter to BHP on steel prices.

Senator Hannan:

-I rise to a point of order.

Senator KEEFFE:

– If you are going to take up my time,I will look after yours.

Senator Hannan:

– Mr Acting Deputy President,I cannot help but feel that Senator Keeffe is straying somewhat from the content of the proposition. I believe he should address himself to the content of the proposition and forget about the peripheral nonsense which he is bringing into it.

The ACTING DEPUTY PRESIDENT - Senator Keeffe, I suggest you keep to the terms of the motion.

Senator KEEFFE:

– Thank you, Mr Acting Deputy President. The letter which the Prime Minister wrote to BHP about the increase in the price of steel was probably symbolic of this new development. I wish to raise a further point. The Sydney pipeline project probably went back to a period about 3 years ago when the Australian Gas Light Co. was endeavouring to negotiate with Esso-BHP for the supply of Bass Strait gas to Sydney. In addition to this the$54m contract that has now been agreed to between Mitsubishi and the Australian Gas Light Co. has a lot of other overtones or undertones which I note were not mentioned by Senator Webster. I ask the Minister whether it is a fact that Mitsubishi was told that it was impossible to manufacture 34-inch pipe in Australia. If the Japanese company was told this, and this had some bearing on the fact that that company was given a contract, was it leaked by a Government Minister or was it done somewhere in the trade without Government supervision of this type of control? Next, if it is impossible to manufacture 34-inch pipe in Australia, why did Tubemakers of Australia tender for the contract? As Senator Webster of the Country Party said, there is at least one other company that could have carried out this job and would have been able to give satisfaction. I wish Senator Little, who is interjecting, would keep quiet because his own contribution had very little logic in it. If I were to refer to the previous attempts by the Australian Gas Light Co. to get Esso gas and the reasons why the Government did not assist in any way at that time it would probably create another major scandal. AGL wanted to get the best deal for Sydney that it could at that time. The company was prepared to do its own exploratory work in an attempt to find sufficient gas with which to supply commercial and domestic users in Sydney. But because of the Government’s ineptitude, Sydney has been deprived of the use of natural gas for a period of more than 5 years.

On 22nd September last the Prime Minister (Mr McMahon) said that Australia would not intervene in the contract. But the New South Wales Premier said that his Government would endeavour to persuade Mitsubishi to spend the contract money locally. A few hours later the Deputy Prime Minister and Leader of the Australian Country Party (Mr Anthony) said that the New South Wales Government had a fair degree of authority to. intervene because it had granted AGL the franchise to supply gas to Sydney. I ask why at the Commonwealth level there was an all-out attempt to duck the issue. It is possible that the loss of this contract to Australian pipemakers and to Australian contractors can lead to the loss of jobs for between 300 and 400 Australian workers, and with the current rate of unemployment we can ill afford to have so many additional people without jobs.

My time is limited and I now want to refer to the recommendations of the Senate Select Committee on Off-shore Petroleum Resources and in particular to the recommendations made in the minority report. First of all, I will read paragraphs 6 and 7 on page 709 of the report. This is the report about which I and my colleagues have complained bitterly from time to time. The Government has avoided bringing the report before the Parliament for proper consideration. Paragraph 6 states:

We are of the opinion that there is no excuse for not having a national pipeline policy. Such a policy should be implemented without delay and gas pipelines, in particular, should be controlled by the Federal Government, especially as we believe that it is only a matter of time before at least every capital city on the eastern and southern seaboard’ of Australia will be linked by gas pipelines.

It is true that the pipeline under discussion, which is of several hundred miles in length, is coming over an inland route but, nevertheless, the Government is adopting the same ad hoc approach to this matter as it adopts to other legislation. It is the same hotch-potch arrangement under which various companies for various considerations are laying down pipelines in various parts of Australia. There is no planning, cohesion or co-operation in the supply of the hydro-carbons that are carried in the pipeline. In paragraph 7 of the minority report we state:

We recommend that a national pipelines policy be implemented immediately and that legislation be enacted - this may require the co-operation of the States - to regulate the construction and operation of pipelines for the carriage interstate or intra-State of oil and natural gas.

I should like to refer to a couple of other paragraphs of the report because I think that they are relevant to the argument. Paragraph 15 on page 710 states:

Pricing agreements in respect of crude oil produced from indigenous sources have been nothing more than ad hoc arrangements made between Prime Ministers and limited sections of industry.

Further on we state:

We recommended that a thorough examination be made of the cost price structure of the production of petroleum in Australian off-shore areas.

That applies also to production on land. This is where half of the trouble has been generated. Without a shadow of doubt, if there had been a cohesive policy at the Commonwealth level, almost certainly this pipeline would have been manufactured in Australia from Australian materials, and it would have been constructed and serviced by Australian workers. But instead the Government adopts the other attitude that it can do nothing at all in this area and that it does not matter very much to this country. I suppose there are hard words which can be used in a descriptive manner, but I do not propose to be offensive about this matter. The issues raised by the Leader of the Australian Labor Party when he introduced the motion relating to this matter of urgency are correct and complete in every detail. The onus is right back on the Government to make a clear and unequivocal explanation of why it refuses to take any action in the matter; why Australian manufacturers were not given the opportunity to tender properly or to have the proper specification in order to be able to submit a tender. It is of no use to say: ‘We do not have in this country the knowhow or the factories or the specialists properly to tender for and carry out a job of this nature’. If the Government admits that, it is admitting that it has been a complete and utter failure. Under those circumstances I think the granting of this contract is a clear indictment of the inability of this Government to govern properly.

Senator LAUCKE:
South Australia

– I thought that in this country we had emerged into the situation of taking a larger view of things than I have heard expressed just now. If we look at this matter against the background of our overseas business interests and requirements in the way of exports, this matter of urgency before the Senate fades right back into something insignificant. What we have just heard is not really worth discussing. At first sight the subject matter of Senator Murphy’s motion may have had some appeal but it has no appeal when it is considered in depth. It refers to the ‘failure of the Government to take action to protect Australian employment and industry in the supply of the Moomba-Sydney pipeline’.

The core of the matter is embedded in the words ‘to protect Australian employment and industry*. This embraces a field much larger than that raised in the motion - the initial supply of certain component parts of a major pipeline of some 787 miles in length; a pipeline which will ensure to Sydney and to New South Wales gas at a price conducive to efficient business expansion with energy costs at the lowest possible level.

The Building of the pipeline will provide employment to many men in the local labour market, lt will provide ancillary requirements in branch mains for some hundreds of thousands of tons of branch pipeline. Overall, it is a major business proposition generating employment and providing power facilities in a way which is typical of Australian development over recent years. The pipeline has the ability to provide the economic background which has enabled us to go ahead as we have done in recent decades.

We cannot look at this matter from a petty, parochial point of view, just regarding the provision of the pipeline itself as the whole matter. It goes far beyond that. Our overall trade these days has to be on a world basis. We cannot live to ourselves. We have m Australia industry which is being promoted through a vigorous and expanding export market. In the financial year 1971-72 we sent to Japan no less than $l,362m worth of various primary products, iron ore and other minerals and so on. The total export income of Australia in that year was $4,902m. In other words, 27.8 per cent of total exports from Australia were directed to Japan. We imported from Japan goods to the value of $659m out of the Import total to Australia from all sources of $4,008m. That is, 15.7 per cent of our imports came from Japan and 27.8 per cent of our exports went to Japan.

– I am discussing now the’ provision of steel pipes and nothing else. I feel that it is very undesirable for criticism to be directed against our own industrial complexes over decisions that they make. In my opinion, it is far better to have enterprise which is conducted by the individuals concerned than to have undue governmental intrusion in Lo industry and commerce. Greater efficiency is always to be found when private enterprise is up the hill. This is in no way derogatory to governmental activity, lt is just one of those facts of life that we can achieve more in a competitive enterprise situation than we can in a much larger complex arising from governmental action in areas that are best left to those who are very closely in touch with the complete situation, who know the requirements and who act accordingly. In the process they develop our economy and provide through their activities employment and tax revenue and promote further industry. Here we have the basis of a healthy economy without which I cannot see how we would advance as a nation in the way that we have in recent times and as we will in the future, I am quite certain, if we are prepared not to intrude unduly into the general running of industry in Australia.

The ACTING DEPUTY PRESIDENT (Senator Lawrie) - Order! The honourable senator’s time has expired.

Senator GIETZELT:
New South Wales

– The Senate and the Australian people are indebted to the Leader of the Opposition (Senator Murphy) for providing the Senate with an opportunity to debate not a question of components parts, as Senator Laucke put it in simplistic terms, but the important question of the future of a great Australian industry which undoubtedly will play a major part in the development of this country in the years ahead. I refer, of course, to the natural gas industry. We are concerned about the first step in developing a new resource which Australia is blessed to have in large quantities and which will augment the power and fuel potential of this country. The Minister for Works (Senator Wright) criticised the Opposition for taking the steps that it has taken to have this matter debated in the Senate. What other avenue is available to the Parliament to debate the importance of natural gas and the ancillary problems that go with the development of this resource? I refer of course to the provision of pipes to enable our first major development in this field.

It is interesting to note that both Senator Webster and Senator Laucke were sufficiently aware of the criticism by the Australian Labor Party in relation to this matter to conclude that Australian industry has not been given a fair go in connection with the provision of pipes for this project. The Senate has been given an opportunity to record its displeasure at the failure of the Government to do any pre-planning in respect of natural gas.

From the layman’s point of view it has become clear over the last 3 or 4 years that natural gas is going to become a major source of fuel in Australia. Any government worth its salt, any government concerned with the economy, with employment or with industry would have had its officers working to establish the requirements associated with this new industry. The Government should have recognised the potential of natural gas and realised that it was going to become a major source of fuel supply in this country. It should have taken the necessary initiatives and steps to alert Australian industry to its responsibility of providing all the component parts to put this industry on its feet. In other words, Mr Acting Deputy President, the Government should have been carving out its leadership role. It should have been pre-planning and preparing for the future.

However, as has been the case so often in recent years, we have an ad hoc Government, a Government that moves after the event, a Government that never looks to the future, a Government that steals policies from the Australian Labor Party when it is caught flat-footed, as has been the case on so many questions in recent times. This

Government has been acting in absentia and has not been applying business principles to the affairs of this nation.

Australia has extensive gas reserves and this particular pipeline project is only the start, a very minor start, to a major development which undoubtedly will be with us for the next 30 or 40 years. At the moment we are concerned about the provision of pipes for a pipeline 780 miles long. However it is anticipated by people who have applied themselves to an investigation of these matters that within the next 10 or 15 years Australia will require something like 20,000 miles of pipe. The Australian industry has taken certain initiatives. What we are debating in this case is a struggle between rival monopoly groups, the Australian Gas Light Co. and Esso-BHP. Clearly, so far as the Australian Gas Light Co. is concerned, it is a matter of sour grapes because it missed out on some of the earlier exploratory rights in the natural gas field. However, we have unlimited supplies and a tremendous potential and these facts have been within the knowledge of the Government for a considerable number of years. Whilst it is conceded that there may be limited experience and knowledge in certain industrial undertakings in Australia about making pipes to the proper specifications, surely it was within the competence and responsibility of the Government to take the initiative to pre-plan for the sort of eventuality that we are faced with on this occasion.

I find it inconceivable that the Government should attempt to defend its position. I want to refer the Senate to a series of questions which the Minister for Trade and Industry (Mr Anthony) was forced to answer in the other place and the comments that he made when pressed time and time again by one of the shadow Ministers, the honourable member for Newcastle (Mr Charles Jones). The Minister for Trade and Industry said:

The second consideration is that we do not infringe basic principles-

I gather that he was referring to tha Government. - that is, we went to see commercial decisions being made by commercial firms themselves without too much intrusion by the Government.

How much double talk and hypocrisy do we have to put up with from this Government? If in fact commercial organisations are to make commercial decisions why is it that in the Budget documents which are before the Senate the Government refers to Commonwealth payments to industry? I refer honourable senators to page 74 of the Budget Speech by the Treasurer (Mr Snedden) where there is a statement setting out Commonwealth payments to industry. That statement is as follows:

These payments are estimated to amount to $367m in 1972-73, compared with payments of . . . about $73m 10 years ago. . . .

The Government accepts responsibilities in the fields of exports, industry, investment allowances and other incentives in order to get industry moving along certain lines and so, according to its limited ideas, get industrial development which will be of some advantage to this nation. On the other hand, when it comes to a question of conflict we see the Leader of the Country Party, the Minister for Trade and Industry, taking quite a contrary stand to that of his colleague, Senator Webster, this evening.

It is clear that the Australian pipe manufacturing industry was not given any real opportunity to participate in tendering for this very important first stage of a mammoth development in this country. The Government is prepared to subsidise the shipbuilding industry and many other industries; so why does it not take the initiative and attempt to get an Australian industry retooled so that it can carry out its responsibility to provide components for the natural gas industry? I want to refer to numerous statements that have been made in the Press. This statement appeared in the ‘Sydney Morning Herald’ only a few days ago:

Workers in the Australian pipe industry could lose their jobs as a result of the $54-million gas pipeline contract given to Japanese manufacturers, a BHP spokesman said last night.

I am sure that the Senate would agree that it is the responsibility of responsible union officials to fight for the rights of their members in any given industry. The representative of the Federated Ironworkers Association of Australia particularly has already indicated to me that the industry in which most of its members arc employed is facing a recession. About 450 employees have been retrenched in the

Newcastle area during 1972 and the Port Kembla plant is not working to capacity. This has led the National Secretary of that organisation Mr Short to stand up and fight for the rights of his members, including their right to work. He is to be congratulated for this - not condemned as he was by the Minister for Works during his contribution this evening.

I am led to believe that officials in the industries covered by this development were led up the garden path by the Australian Gas Light Co. They were led to believe - Senator Laucke has agreed in principle with this - that about 50 per cent of the contract would be available to Australian industry. But when the chips were down the Australian Gas Light Co. was prepared to abdicate and to place its complete order overseas. It is only natural that there would be a reaction to this right across Australia. It is interesting that of all people in Australia only Government supporters and their little Sir Echo in this place - the Democratic Labor Party - have been prepared to defend the actions of the company in these matters. The Australian Gas Light Co. enjoys a particularly privileged position. It is virtually a State nationalised industry in New South Wales. It is constituted under a New South Wales Act of Parliament. Surely it is a responsibility of the State government to see that the Australian Gas Light Co. plays a better role in this than it is playing at the moment. It is the responsibility of ‘;he Commonwealth to apply its tariff laws to enable the Australian work force to be gainfully employed and for Australian industry to play a part in this important project. The retooling of our tubemaking industry is of vital necessity because there is an unlimited market in the future.

I urge the Senate to give serious consideration to this matter this evening because of its wider implications. The Government cannot afford to apply a laissez-faire approach to this. It must start to plan the Australian economy. That is what the Australian people are looking for and that is why they will turn to the Australian Labor Party at the election in November.

Senator CARRICK:
New South Wales

– The motion should be rejected on 2 grounds: First, for the cynical device that it is; and secondly, for its total lack of factual merit. The Australian public should know that the real reason why this motion was brought in at no notice today and with no warning is that the Australian Labor Party is determined to reduce as far as possible the amount of time that the Senate devotes to debating the budgetary measures. Its whole aim is to prevent as far as possible the full merits of the budgetary documents being expounded and being brought to the attention of the Australian people, particularly because the proceedings of the Senate are being broadcast today. The Labor Party has run away from the Budget and the people of Australia should recognise that as the greatest tribute that has been paid to the Budget as a document of social reform. This motion is a cynical device and it lacks merit. Let me examine why it does.

In the first place it is not true that the Government has failed to take action to protect Australian employment and industry. The Minister for Customs and Excise (Mr Chipp) has made it clear - these are his words - that the matter will be thoroughly investigated to determine whether or not suitable equivalent pipe is reasonably available from Australian production before a decision is taken. In other words, the Australian Government has said that it is investigating the position thoroughly to see whether there is reasonably available from Australian production the kind of pipes that are required. So in fact there has been no failure.

Let me examine this further. The first suggestion is that we have failed to protect employment. I merely mention that in the State concerned, which is my own State of New South Wales, the unemployment is at 1.61 per cent and is falling. That is not bad as a protection of employment. Since Senator Murphy is trying to interject I want to say that until 7 years ago, under 24 years of State Labor government, my State fell from the top to the bottom of those States that provide job opportunities, those that provided protection for employment and industry in Australia. Under the State Labor Government there was the lowest expansion of any kind of job opportunity. So When the crunch came and the Labor Party has its opportunities it is the one that fails. Yet we are asked to say that it would do better and that we have failed.

We are talking of the steel industry. In New South Wales in the steel industry, as at today’s total, some 60 per cent of all employees at Port Kembla and at Newcastle are migrants. The Party that cynically brought in this motion today is dedicated to the complete destruction - the dismantling - of the immigration system. Even on the recent say so of its own leader (Mr Whitlam) it is dedicated to the abolition of the assisted immigration programme as such.

Senator Gietzelt:

– Who initiated the programme? It was Arthur Calwell.

Senator CARRICK:

– I pay tribute to Arthur Calwell as a good Australian. I only wish that the Australian Labor Party would follow him now in the policy that he initiated. It took courage and vision to bring in this kind of policy. Since we are touching on these things, the Party which is really out to destroy employment in Australia in terms of expansion of employment and industry is the Australian Labor Party. It will do so by the very destruction of 2 things - by the destruction of the immigration programme which will slow down immensely any expansion of the steel or other industries, and its own platform which says that it aims to establish an integrated iron and steel industry under public ownership and control. This is the industry in respect of which Senate Gietzelt says that we are failing to apply business principles. Are we failing to apply business principles when the spokesman for the Labor Party on business principles, Dr J. F. Cairns, says in the authoritative Labor and Tariffs’ which was recently published in the document ‘Towards a New Australia’-

Senator Young:

– Who said this?

Senator CARRICK:

- Dr J. F. Cairns, the Labor Party spokesman. I want to read this carefully because he said:

For the Australian Labor Party, tariffs must never be merely an economic matter, never merely a matter of seeking what is economic or efficient.

They are glorious words. But let me go on and read what Dr Cairns says we should do in this country of ours. He said that we are facing a situation where our trade with

England is no longer there but where there is a great imbalance of trade, where we are exporting more than we are importing.

Senator Gietzelt:

– Read all of it.

Senator CARRICK:

– I shall be very glad to read it. If honourable senators so desire, after I have finished the quotation I shall table it for the benefit of the Senate. He said:

We cannot afford in the future to look mainly for all things to a United States-Western EuropeJapan alignment for Australia. These countries are sophisticated beyond that possibility. We must be able to increase our trade wilh the developing world. But in order to do this we must import from the countries of the latter. At present the Australian flow of exports to them exceeds what we take from them by 10 or 20 times, and this balance must be redressed. But to achieve these results, some areas of Australian industry will have to be cut back at least relatively and we will have to specialise on what suits us more than we have done.

Senator Wright:

– Whom are you quoting?

Senator CARRICK:

- Dr Cairns. This is from an official document. Incidentally, if anyone wants to hear Alice in Wonderland gobbledegook, let me quote the second paragraph of the contribution by Dr Cairns:

Tariff policy for the ALP, like every other matter, must be related to the basic aims of the party. These aims are socialist aims. They are to change society from its acquisitive, competitive character, as it is in capitalism, to a humane, cooperative society which is socialist.

That is the thesis of Senator Gietzelt, who said that we are not applying business methods. Having said that and exposed the situation - the policy of the Labor Party on tariffs is quite clear - I remind the Senate that on the ‘Monday Conference’ programme in October last year Mr Whitlam, when quizzed, said that his Party would cut tariffs in general. He was asked to repeat ‘in general’ and he said: ‘Yes, in general’. If one proposes to cut tariffs in general, what one is inviting is an inflow into this country of low cost goods which will destroy employment and industry.

The Labor Party comes here today and, with absolute humbug, talks of the protection of Australian industry, despite its policy, firstly, on revaluation. Let no-one run away from that policy. If one wants to destroy employment and industry in this country one should follow Mr Whitlam’s policy of revaluing. This is the Party that comes here today with this humbug in order to stop us talking about the Budget. This is the Party whose Leader says: ‘I favour revaluation’. Leaving aside the absolute irresponsibility of such an announcement, that policy would create untold unemployment in agriculture, mining and industry. Mr Whitlam’s policy would import unemployment into Australia. That is the protection we have for both employment, by the destruction of the immigration system, and industry, by the nationalisation of the steel industry so that we will have one monolithic industry and no business methods at all. If anyone wants to see that, he has only to look at the British steel industry and see its lack of competitiveness.

I remind the Senate again that the party that has the sheer nerve to come here and tell us that we are failing to protect employment and industry is the party which, in my State in 24 years, brought industry and employment to stagnation. Honourable senators opposite may shout their heads off, but I have merely brought forward those specified cure-alls that the Labor Party has said will produce for Australia the protection of employment and industry. Because it is demonstrable to everybody in Australia that they would create massive unemployment, stagnation and inefficiency in industry, is it any wonder at all that honourable senators opposite squeal? These are the people who preach st something and then practise the reverse. These are the people who say that foreign ownership is wicked while Mr Dunstan, the Labor Premier of South Australia, runs to a foreign advertising agency and so does the Labor Party in Australia generally, and while Mr Tonkin, the Labor Premier of Western Australia, stands up and says: T am willing to have Japanese trade; I am willing to have Japanese capital’. So, the theory explodes in practice. What we have when the theory is put into practice is the destruction of every kind of thing that is argued in this theory.

Tonight we heard reference to what .vas said to be the scandal of trade with China. I wonder whether members of the Labor Party have heard of the massive order of one million tons of wheat which was announced by the Australian Wheat Board tonight from Hong Kong. Where is the failure in an order for 13 million bushels of wheat? One by one, the feathers of the socialist duck are being plucked. Let us have a look at this socialist duck. If I may mix the metaphors, it is now really a headless chook. Here is a party that conies before us and says that we have failed. Yet the Minister has said that we will investigate this matter thoroughly and see whether Australians can do the job. I hope to goodness that the contract can be let to Australians because 1 stand here to say that the employees in the steel industry in Australia are first class Australians. They have made a great contribution. So have their leaders. So have the Laurie Shorts and the Harry Hurrells of this world. I respect them immensely. 1 respect the trade unions as such. But to say that men in the steel industry are facing unemployment is to fail to repeat what the steel industry is saying. It is committed to expansion of the industry in Newcastle and elsewhere to the extent of tens of millions of dollars. In fact, there will be a preparedness to take on far more employees than may be available to the industry.

We have this urgency motion which refers to the protection of employment and industry. The Labor Party will destroy employment by the destruction of the immigration system and by bringing in a heterogeneous collection of people, as it has said it will. The Labor Party will destroy industry by revaluation, by general tariff cuts and by the wonderful Alice in Wonderland nonsense that Dr Cairns has put on paper. Our adversary has written a book. Yet the Labor Party comes to us and says - this is what every one of the Labor speakers has said tonight - that it is wrong to import from a country with which we have an adverse balance of trade. Dr Cairns says that Labor Party policy is to redress the imbalance of trade and that we must realise that we must import from those countries with which we have an adverse balance of trade and, in so doing, we will have to abandon some of our industries or cut them back. What a difference there is between what is said and what is holy writ - or is socialism unholy writ? In fact, the arguments that have been put today are in direct contravention of Australian Labor Party policy. Let us talk some hard facts on this matter.

Senator McAuliffe:

– It is about time.

Senator CARRICK:

– 1 agree with that. It is time.

The PRESIDENT:

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

Senator MURPHY:
New South WalesLeader of the Opposition

– in reply - The urgency motion that I moved this morning was described by the Minister for Works (Senator Wright) as being extremely important. It was so important that he asked for time to ascertain the facts in relation to it. He said that he would go to the relevant Ministers and obtain statements from them. That is what I understood him to say. So, we expected him to give the answers at 8.45 this evening. But there were no answers, because the Government has no answers. In fact, it has failed to take action to protect Australian employment and industry in the supply of the Moomba-Sydney pipeline. It is clear that in failing to plan for the development of the transportation of natural gas throughout Australia it is failing Australian workmen. The diatribe by the Minister against the trade unions will not be accepted by Australia. Men such as Laurence Short spoke out with courage in defence of the entitlement of their members to work. The companies concerned are in confusion because of the refusal of the Government to give any kind of guidance or leadership. The Government has failed in this instance. What is worse than anything else is that it has failed to provide for the proper planning of this industry. I ask that the Senate support the motion.

Question put:

That the motion (Senator Murphy’s) be agreed to.

The Senate divided. (The President - Senator Sir Magnus Cormack)

AYES: 19

NOES: 23

Majority . . . . 4

AYES

NOES

Question so resolved in the negative.

page 1288

ADJOURNMENT

Reported Hijacking of an Aircraft -

National Service

The PRESIDENT:

– Order! In accordance with the sessional order relating to the adjournment of the Senate, I formally put the question:

That the Senate do now adjourn.

I can summarise my allegations. The first charge is that on that day obscene language was used on the oval in front of visitors. This was sufficient to raise a protest from visitors who were there that day. The obscene language was used by - according to description - the little chap in the red sash. The second charge was of obscenities to the visitors themselves on an area in front of the camp by a military officer. The third charge is that there was a breaking of soldiers’ private property in the huts. The fourth charge is that there was humiliation of the troops in that someone had to stand and repeat over and over again: ‘I love my rifle’. The fifth charge is that there was an incident on the previous day when one of the soldiers fainted and - in my words - fell on his bayonet. I think that this is the most important matter which seems to be the centre of present day inquiries.

To make sure of what I said I read from the Hansard report at page 1069 which states:

One young soldier bad sticking plaster under his chin. The story was that the previous day, during rehearsal-

Honourable senators will notice the words: The previous day during rehearsal’ - on the parade ground, he had fainted and had cut his chin on his bayonet. The cut needed stitching. As he tay stunned on the ground one of the servicemen, seeing the blood, sought to go to his assistance. The officer in charge, in true Askin style, said: ‘Let the bastard die’. That was the effect on the officer of the cut under the lad’s chin.

That was my allegation in relation to that incident. The sixth allegation is that there had been 3 suicides at Puckapunyal. On Thursday the Press reported my speech and stated that I complained that offensive language had been used before visitors on the occasion when a lad lay bleeding as a result of striking his chin on a bayonet. Honourable senators will remember that I did not make that claim at all. I reported this as happening the day before.

On the Thursday night I rose during the adjournment debate and asked for a inquiry to be made. I rose mainly to repeat the Minister’s denial of my allegation and a denial by Lt-Col. Maizey who said that no such thing happened. On the same night in reply the Minister for Air (Senator DrakeBrockman) stated:

My understanding of the situation does not conform with that of Senator Cavanagh. When 1 entered the Senate this morning I had a brief on this matter. My understanding is that the lad in question did faint and he did cut his chin. But the medical orderlies were not on the scene quickly enough and the Lieutenant-Colonel used the words which he used not to the recruit who had fainted but to the medical orderlies. In view of what the honourable senator has quoted, I will make a further investigation and let him know the results of that investigation.

I thought I had put the record straight on Thursday night. The Minister promised me a further investigation in relation to what I raised that night. He said that he would let me know the results of the investigation. He said that we should await a reply but in the Adelaide ‘News* of Friday, 22nd September, a denial from the Minister was reported. The article stated:

It was a training parade, and not a public parade during which a recruit collapsed,’ he said

The Minister is reported to have said:

This was a compassionate demand and the senator has given entirely the opposite impression.

If this were done deliberately, it certainly is not to the senator’s credit.

So we have reported in the ‘News’ on Friday, 2 days after the allegations and after the Minister has promised to inquire into the incident, a statement indicating that I had said that this incident happened before visitors. This indicates that the Minister investigating the matter has never looked at the statement which I made and he went out of his way to say that this was not to the senator’s credit.

The Australian Broadcasting Commission programme ‘This Day Tonight’ seems to feel some inhibitions as a result of accusations that it has given favourable treatment. It went through this camp and having seen the camp concluded that Senator Cavanagh must be ill-advised. While we are awaiting an investigation based not on my charges but on newspaper reports there is this denigration of the one who raised the matter. In answer to a question yesterday the Minister for Air made the bald statement that the allegations had been refuted. Let us see whether they have been. I stated that 3 suicides had occurred at Puckapunyal. This was proved to be wrong and to be a false statement by comments from Lieutenant-Colonel Bennett. In the ‘Age’ of 22nd September, we find this report:

An Army spokesman said yesterday that 5 national servicemen attempted suicide after the last intake, not 3 as claimed by a Labor senator.

So, Senator Cavanagh was wrong when he said that there were 3; there were 5. My statement was corrected by LieutenantColonel Bennett, the Army spokesman. The ‘Age’ report continues:

Asked about suicides, Col Bennett said: ‘Of this intake, the third of 1972, there were 5 cases of attempted suicide.

In 2 of these there was a previous history before entering the Army . . . one of them had multiple attempts’.

A better explanation appears in an article in the Adelaide ‘News’ of Friday last in which Lieutenant-Colonel S. J. Maizey reaffirms that there were 5 attempts in the last intake. He said:

Two of the lads had a long history of attempted suicides before coming into the Army.

One brought his own rat poison and sprinkled it on his cornflakes like sugar’.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– Was he a national serviceman?

Senator CAVANAGH:

– They are all national servicemen. The Army has accepted as national servicemen 2 lads who had a long history of attempted suicide. What is wrong with the Army’s method of assessing the suitability of a person to serve? What is wrong with its entry examinations when the Army admits to service 2 lads willi records of prior multiple suicide attempts? One lad entered the Army carrying his own ingredients - rat poison - with which to commit suicide. The report in the News’ continues:

The third attempt was by a conscript who faced the prospect of repeating some of his training missed because of illness.

The prospect of an extended period in this Army camp was too much for that lad. The report continues:

The fourth was by a conscript of low mental age who could not adjust to Army life.

Here is an example of the induction into the Army of a conscript of low mental age. Surely it must be obvious to any examining officer when someone is of low mental age. I come to the serious point of the question concerning the attempted suicides by people who do not have the necessary physical or mental capabilities to submit to Army life. Their condition should have been detected. They were conscripted into the Army in accordance with the National Service Ace which provides for compulsory military training. As a result, these lads attempted to commit suicide. The report in the ‘News’ continues:

The fifth, the attempted hanging was by a conscript who had twice gone AWL and had been captured by military police.

I will mention shortly the case of a conscript; it may be the case of the fifth person mentioned in the ‘News’ report. A multitude of correspondence has reached me on this matter. I will not record in Hansard the names of those who have written to me or the names mentioned in the letters. The letters are available. They were not sent in confidence. The Minister may see them if he wishes. One lad writes: lt has to do with suicides by national servicemen. My young brother was called up to do national service, but earlier this year lie went AWL from Puckapunyal and as a consequence he was posted to Kapooka (it is in NSW just north of Albury) he went AWL from Kapooka - as a result he was to be paraded before his Commanding Officer on a specific day. However (his did not come to pass. The reason explained to my brother, and hence passed on to the family, was that a young man had attempted suicide and the officer concerned was busy. My brother went AWL again and went back to camp a fortnight later and nothing was heard from him, with the result that my father became worried and drove up to the camp - he phoned the camp and was told that the commanding officer was busy elsewhere, my father reportedly asked whether there had been another suicide to which the reply was this is the third this week’.

The reply from the receptionist on the telephone was that this was the third suicide at Kapooka that week.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– What was the date?

Senator CAVANAGH:

– The date of this letter is 21st September 1972. The letter writer said that this occurred some 2 months ago, so these events are commonplace.

I turn to the Adelaide ‘News’ of Monday, 26th September 1972 which informs us that happenings of this type occur not only at Puckapunyal but also at Kapooka. The article which T will read is a reprint of an item published by the Sydney ‘Daily Mirror’. A photograph of the reporter interviewing the 3 conscripts for the purposes of this article, who told of the suicides in the camp, appeared in the ‘Daily Mirror’. The article states:

The 3 recruits who tried to lake their lives there, slashed their wrists.

One was found in the toilet, nearly dead from loss of blood. He recovered, and with the other 2, was discharged from the Army.

The incidents, were revealed by other national servicemen in the battalion who completed their 10-week basic training this week.

They said other trainees made bids to escape what they described as a bastardisation process.

The conscripts, who gave details of incidents at Kapooka asked not to be named for fear of reprisals.

The article, quoting one national serviceman, states:

He said punishments also included gaoling, fines, and confinement to barracks. But back-squadding was feared the most.

It’s so bad some recruits bash others who they think aren’t pulling their weight and who could gel the whole platoon into trouble,’ he said.

One recruit was dropped out of a second storey barracks window and broke his leg’.

The fear exists among these servicemen that if the standard of training is not maintained those responsible must stay longer at these camps which provide initial training. The question of the suicides that have occurred is a serious one. The information that I have received and these Press reports indicate that what has been happening is worse than the incidents of which I had knowledge at the time I raised my complaint. The question about swearing in front of visitors has never been answered and possibly was never looked at. Some answer came from LieutenantColonel Bennett who denied that this could happen. The question of swearing at visitors has not been answered; nor has the question of the breaking of personal property.

I have found among my papers a letter that I received from a new Australian who states:

The Colonel of No. 2 Base Workshop, Moorebank, NSW, ordered a formal gathering of all personnel, Civilians and Military personnel, pleaded that no-one (actually directed) to keep all of, quiet, the suicide of an Army Captain with (please) keep such from newspaper etc.

Furthermore, may we speak of other, the Regular Army fellow, committing suicide, by taking a cup-full of ‘steel hardening compound’, viz. ‘HARDITE not sp very long ago (buried, 1 may add, with full military honours) perhaps to keep the peace’.

This matter needs investigation. I leave the suicides and the questions which have not been answered and turn to the questions that the newspapers have taken up and which have become of public interest today. I refer to the matter of the injured soldiers I said that he fainted and fell on his bayonet and cut his chin. LieutenantColonel Maizey said he fainted and fell but did not fall of his bayonet but fell on the gravel and cut his chin. I do not suppose how he cut his chin is important. He cut it. One would expect that when he fainted on parade he would have fallen on the back of his head or on the side of his head or on his face, and unless he is some sort of a contortionist how gravel could cut underneath his chin is hard to explain. Nevertheless Lieutenant-Colonel Maizey said that ls what happened and when it happened there was blood around.

My report says that when someone went to his assistance the Colonel said: ‘Let the bastard die’. It has since been shown that this soldier who fainted has been identified as Sapper Douglas Smart, I believe of Hobart. He has 5 stitches inserted in the wound. He has given his report of the incident, which would show again that I am somewhat incorrect in what I said the Colonel stated. This is what the victim Sapper Smart said as reported to a news reporter and published in the ‘Australian’ of Saturday, 23rd September:

Sapper Smart, who came out of hospital yesterday after recovering from mumps, claimed Colonel Maizey shouted: ‘If the bastard is going to faint on parade, let him die’.

That is the variation between ‘Let the bastard die’ and ‘If the bastard is going to faint on parade, let him die’. But it says Sapper Smart was not questioned.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– He should be court martialled.

Senator CAVANAGH:

– He should be court martialled to give him the right of trial. But, of course, Colonel Maizey says this is not the case, and what Colonel Maizey says has been accepted by the Minister in his report to the news media. He said that, when the soldier fainted and the medical orderlies were not prompt with attention, he said: ‘Take him off the bloody oval before the bastard bleeds to death’. This does not appear to me to be a term of endearment but an indication that he did not want a corpse on his oval. He was not concerned with loss of life of someone who had the audacity to faint on parade. He was not concerned with that; but he did not want a corpse on his oval, and that is his explanation of this particular question.

Honourable senators will see how this affects some people. Someone who will not accept that there would be any untruth in what I said wrote to me about this matter. This writer’s name, too, is available to the Minister if he wants it. In his letter he said:

If your case is suspect, I will give you these facts that you can use if required, my son was called up, at 21, he has worked in’ a factory, so one feels has beard a few swear words, but he has never been permitted to use these at home, he was brought up to attend Church, but is a normal person … on leave he complained, to his friends, and after I had asked, to me, that all the recruits were subject to the most foul abuse from instructors, in fact from these gutter dregs he was a Bastard and his Mother a whore, this was my interpretation, and as the CO. used the words Bloody Bastard, it can be assumed correct.

I wrote my MP Hon. Phillip Lynch as he in effect was partly responsible, being Minister for National Service, Mr Peacock, Minister for the Army, Leaders of Churches, C of E and Catholic, plus the Army chaplain, Hon. E. G. Whitlam, MP, plus phone contact with Col Bennet, Public Relations Officer, Victoria. Net result,no action, with the suggestion that it did not happen.

Here was a man brought up with the religious education who resented the way in which his lad was spoken to and who tried to make a complaint to every officer he could contact. He fought to bring pressure to bear somewhere, but no action was taken.

Senator McClelland said that LieutenantColonel Maizey should be court martialled. Let me check what the responsibilities of Lieutenant-Colonel Maizey are under the regulations. Australian Military Regulation 207 states:

Any member of the Military Forces who, when on duly within the meaning of A.M.R.197 or in uniform-

Firstly, we have to see whether LieutenantColonel Maizey was on duty in accordance with regulation 197. That regulation says: 197. - (1.) In the circumstances mentioned in this regulation, when not subject to the A.A., the persons mentioned in this regulation shall be subject to military law within the meaning of these Regulations:

Every member of the Permanent Forces, at all times;
Every member of the Citizen Forces, when on duty or in uniform;

The regulation goes on to speak of a member being under arrest. Therefore, accepting Lieutenant-Colonel Maizey as a member of the regular forces, he is subject to military control at all times as a result of this regulation whether he is on duty or not. Regulation 207 prescribes that any member of the military forces who when on duty within the meaning of the regulation or in uniform - and Colonel Maizey fills both requirements - and who uses blasphemous or obscene language or who speaks or acts indecently or who engages in immoral conversation shall be guilty of an offence, and shall be liable to penalties as prescribed by regulation 215.

Before looking at the regulation further, since we have heard so much of law and order in this chamber, I ask where are the supporters of law and order. I ask the Minister whether this man who on his own statement, not my statement, used blasphemous language and obscenities to a kid is to be charged before a court martial. Is he free to make public statements to the effect that Senator Cavanagh should get his facts right? This is a man who is in direct breach of the regulations on his own statement and who states, as exoneration from any charge made: ‘I have no concern for the regulation; I am a law unto myself.’ Where is the Minister who has not looked at the charge, who has to investigate this, but has done nothing about it at this stage? Regulation 215 provides certain penalties. I read an extract from the regulation:

In the case of an officer or a personsubject to the D.A.. as if he were an officer, according to the scale following, that is to say:
Imprisonment, with or without hard labour, for a term not exceeding 3 months.
1. Dismissal from the Defence Force.

Lads who are treated to such an extent that they seek to escape by attempting suicide are still in the forces one week after the charge was made while the Minister is dilly-dallying trying to exonerate his officers, his guilty officers, and trying to exonerate himself and trying to exonerate his organisation. This lad is still there and is suffering as a result of this administration which is going on.

I asked a question yesterday - and I repeated it - to see whether we cannot move the Minister faster, to see whether we can force the Minister, and as the lads are still in there whether he will see that there are no more subject to this campaign of terror, that no more are brought to the verge of suicide until there is an inquiry into these allegations and a rectification of any injustice or any other rectification that is necessary in the camp. Let us not have another intake until these things are investigated and rectified. That is my plea. Let us have a hurried investigation for the purpose of some rectification.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– I have listened with a great deal of interest to the remarks made by my colleague, Senator Cavanagh, this evening. It concerns me very much that a senior military officer rather than the Minister for the Army (Mr Katter) can reply to accusations made by an honourable senator in this Parliament. The accusations were of a very serious nature. They referred to men who have been conscripted and called up for military service attempting suicide because of the conditions that have been imposed upon them. A member of this Parliament, who has been elected by the people of Australia;, makes accusations in this Parliament. It is not the Minister in charge of the Department who replies but the colonel who is in charge of the military establishment! When that is tolerated by the Australian people and by this Government we will be at a very serious stage. Indeed, you are not establishing a police state; you are establishing a military state. 1 suggest to the Minister for Air (Senator Drake-Brockman), who is sitting at the table, that he should confer with the Minister in another place to see that any reply that is given to accusations made in this Parliament should be given by him as the ministerial head of the Department and noi by some Army officer who is in charge of men, be they volunteers or conscripts. The accusations that Senator Cavanagh made caused the Minister for Air last week to make the statement that he would call for an inquiry into the Army conditions at Puckapunyal. After the Minister’s statement last week that he was ordering an inquiry Into those conditions-

Senator DRAKE-BROCKMAN:
WESTERN AUSTRALIA · CP; NCP from May 1975

– Do not point yOUr finger at me.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– I regard this as a very serious matter because it leads me to another matter. After the Minister had made this statement that he would order an inquiry into the conditions at Puckapunyal, the Army officer in charge of the camp answered on his own behalf. That, I think, is a very serious matter. If the Government had ordered an Inquiry, then I would have thought that at that stage the matter was sub judice and the Army officer in charge of the camp had the responsibility to answer in his own defence in the course of that inquiry and not to make a reply on behalf of the Minister outside this Parliament to the allegations made by my colleague.

But this leads me to another matter. In 1970 I made accusations, by way of correspondence, to the then Minister for the Army, Mr Peacock, about the serious state of the military prison at the Kapooka military camp. As a result of complaints that were made to me I asked the then Minister for the Army to make an inspection of the military prison at the Kapooka military camp which is just outside of Wagga. I was accompanied there by officers not only of the Kapooka military establishment but also of Eastern Command, Victorian Barracks. I was shown over the camp and over the military prison at the camp. To say the least, it was in my opinion a Black Hole of Calcutta. From recollection, I saw it in May or June 1970, and the winter in Kapooka is pretty severe. The interior of the establishment was lined with tin that was painted black. It was something akin to the internal appearance of a refrigerator, except that it was painted black.

There was a little window which was of the order - I am speaking from recollection now - of about 2 feet 6 inches by 1 foot 6 inches. There was what one might call a makeshift bed. There were 2 blankets, a bucket in which to urinate and a utensil for drinking purposes. I regarded those conditions as inhumane, and I told the officers who accompanied me on that inspection that I thought they were inhumane. I reported the conditions to the then Minister for the Army who agreed to inspect conditions at the camp. As a result of his inspection of the conditions, I well recall that he rang me shortly afterwards - I was in Tamworth at the time - and agreed with me. He told me that the interior of the cells would be painted a light colour, such as white, cream or whatever it might have been, that the conditions would be improved and that in the 1970-71 works programme, arrangements would be made for a new military prison to be built at Kapooka.

I feel very strongly about this matter because an undertaking was given to me in May or June 1970 - unfortunately I do not have the correspondence with me - that in the works programme of 1970-71, arrangements would be made for a new military prison to be erected at Kapooka military camp. That undertaking has not been fulfilled by this Government at this stage. I assure you, Mr President, and I assure the Minister for Air who is at the table, that the residents of the Wagga district are very concerned that these undertakings which were given by the Department and by the then Minister for the Army have not been implemented.

Frankly, it appears to me that the Army has set itself up as being above the rights of this Parliament. We had an officer of the Army answering allegations which were made by Senator Cavanagh when they should have been answered by the Minister for the Army. In the case to which I have referred, the then Minister for the Army undertook that a new military prison would be established at Kapooka in the 1970-71 works programme to bring it up to modern, humane conditions. We are now in 1972-73 and that undertaking has not been fulfilled. I urge the Minister to see that the Army wakes up to itself and brings itself up to modern, everyday thinking.

Senator DRAKE-BROCKMAN:
Western Australia · CP

– For the second time in an adjournment debate Senator Cavanagh has taken the opportunity to draw the attention of the Senate, and of the Minister for the Army (Mr Katter), to certain allegations that he has made in regard to military life at 2 Army camps. Not only has Senator Cavanagh done this; he has also taken the opportunity during question time to put to me, as Minister representing the Minister for the Army, a series of questions. Both the Minister for the Army andI have indicated to and assured Senator Cavanagh that we would make investigations into the matter.I do not know what sort of investigations Senator Cavanagh is expecting us to make. One can get on the telephone and ring up an officer and say: ‘Did such and such happen?’ He says: ‘No’. If that is the sort of investigation that Senator Cavanagh wants, that is not the sort of investigation that I or the Minister for the Army want to give him. We want to make sure of the facts concerned in the allegations made by the honourable senator.

– It builds up to the case that the honourable senator put before us. Senator Cavanagh then talked about health standards. He said that there is something radicallywrong with them in that people suffering from certain complaints are inducted into the Army. Let me remind the Senate that not very long ago I recall the Deputy Leader of the Opposition in another place (Mr Barnard) saying that the medical standard for recruits into the Army was far too high. Yet Senator Cavanagh complains that it is far too low. It is my understanding that 60,000 national servicemen have been called up and have served. These recruits come from all walks of life and all have certain characteristics in their medical history. They are examined by men who have a reputation in the medical world. At the time of examination some little peculiarity may not be picked up, but I do not think that 5 cases out of 60,000 is too big a percentage. I think that men with suicidal tendencies will be found in the same percen tages in the community as a whole. All I can do is give Senator Cavanagh the assurance that the Minister for the Army and I have given him on previous occasions: This matter will be examined thoroughly. When the Minister for the Army is in a position to make a statement I feel sure that he will do so. I could say a lot more in regard to the matters raised from my personal experience as a Service Minister.

Without delaying the Senate, let me turn to what Senator Douglas McClelland said. I accept part of his allegations. I think that when a Minister calls for an investigation into a matter no officer should make statements to the Press. Indeed, in my own portfolio of Minister for Air I would reprimand a senior officer for doing so. Both I and the Minister for the Army have promised a full investigation into the matter. In my book, no serving officer should make any public comment until an investigation has been carried out. I accept that. I do not accept the remainder of the honourable senator’s remarks, but I will ask the Minister to give him some information on the matter of the gaol.

Question resolved in the affirmative.

Senate adjourned at 11.58 p.m.

page 1297

ANSWERS TO QUESTIONS UPON NOTICE

The following answers to questions upon notice were circulated:

page 1297

SUBSIDY TO SHIPBUILDERS

(Question No. 2418)

Senator McAULIFFE:

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

Does the new subsidy to shipbuilders represent no actual improvement on the previous subsidy because it is now based on a world price for building a ship and not on the 10 per cent to 15 per cent higher quote received from a British yard.
Why was the Tariff Board’s recommendation that subsidy should be applied to ships built for export if free import of new ships was permitted, rejected.

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

Under the subsidy scheme operating before 1 June 1972 the maximum subsidy level was 334 per cent of the Australian construction cost. The actual rate for a particular ship was based on the cost of a similar ship built in the United Kingdom, including delivery to Australia. Under the new scheme, the subsidy level ranges from 25 per cent to 45 per cent of the Australian construction cost, according to the gross tonnage of the vessel. Vessels over 4,000 gross tons, therefore, will now attract a higher subsidy than under the old scheme. Some vessels below this size, which did not require subsidy at the previous maximum level would now also attract a higher subsidy. Moreover, subsidy now applies to modification and escalation costs.
The Tariff Board in its report, did not indicate thatits recommendations in relation to:
1. freeimport of new and secondhand ships and
2. expansion of subsidy to ship exports were in any way interdependent. On the contrary, the Board made it clear that it considered the abolition of the import prohibition on both classes of ships to be fundamental to its proposals.
While the Government did not adopt the Tariff Board’s recommendation to subsidise ships for export, neither was the Board’s recommendation for unrestricted imports of new and secondhand ships accepted.It is not the practice of the Government to provide subsidy on manufactured goods for export. If the Government was to agree to subsidise the construction of ships for export, no doubt there would be many other industries which would seek similar assistance. Moreover the Government took into account the implications for our international trade relations arising from any decision to subsidise exports of manufactured products.

page 1297

HARBORD POST OFFICE

(Question No. 2427)

Senator WILLESEE:

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

Does the Postmaster-General’s Department propose to transfer all mail sorting and delivery staff from Harbord Post Office to a new centralised depot located at Manly, New South Wales.
If the answer to (1) is in the affirmative, what are the reasons for the proposed rearrangement and were consultations held with local residents and businessmen to determine their views on this matter.
If the Postmaster-General’s Department proceeds with the rearrangement, will Harbord Post Office be reduced in status to that of a nonofficial post office.

Senator GREENWOOD - The Postmaster-General has provided the following answer to the honourable senator’s question:

and (2) It is not intended at this stage to change the arrangements at present operating at the Harbord Post Office. The accommodation position at Harbord is, however, reaching the stage when it could become necessary to obtain additional working space by transferring the postmen to Manly Post Office where adequate space will shortly be available. In those circumstances, it is intended to review the arrangements at Harbord early next year unless additional staff is required in the meantime. Any operational changes which may be found necessary will not reduce the grade or range of the postal services provided. This was explained to a meeting of the Harbord Chamber of Commerce early in July.
The method of operating the Harbord Post Office, which would not change the grade or range of services provided, will be examined in the light of any operational changes which may be made.

page 1297

AUTOCEPHALIC GREEK ORTHODOX CHURCH

(Question No. 2390)

Senator GEORGES:

asked the AttorneyGeneral, upon notice:

Under which powers and for what reasons has the Attorney-General’s Department declined to proclaim and recognise the Autocephalic Greek Orthodox Church in Australia.
Why has it taken the Attorney-General’s Department so long to establish the viability of the Autocephalic Greek Orthodox Church in Australia.

Senator GREENWOOD- The answer to the honourable senator’s question is as follows:

and (2) The power to proclaim a religious body lo be a recognised denomination for the purposes of the Marriage Act 1961-1966 is vested in the Governor-General by section 26 of that Act. In July 1971 the then Attorney-General, as the Minister responsible for the administration of the Act, informed the Autocephalic Greek Orthodox Church of America and Australia that he was not prepared to recommend that it be recognised because he had reservations about its long-term stability. The Church has recently re-applied for recognition under the Act and I have the matter under consideration.

page 1298

RESEARCH AND DEVELOPMENT

(Question No. 1810)

Senator WILLESEE:

asked the Minister representing the Minister for Education and Science, upon notice:

When will the Department of Education and Science report on research and development expenditures in Australia be completed, and is it intended to publish this report
When will the section of the report on Commonwealth research expenditures be completed, and will the Minister make it immediately available to Parliament.

Senator WRIGHT- The Minister for Education and Science has provided the following reply to the honourable senator’s question:

1 am making available a summary of the present status of Project Score (Survey and Comparisons of Research Expenditures) in reply to House of Representatives Question No. 5495.
Collection of information from Commonwealth departments and instrumentalities on their research and development expenditure has been completed, lt remains to write a report. This is being prepared by my Department and will be made available to Parliament when it is published. Although at this stage analysis of the Commonwealth data is not complete. 1 am in a position to provide the following summary of results for that sector:

Expenditure in 1968-69 on research and development performed by the Commonwealth’s own agencies totalled approximately $l35m. The distribution of that expenditure between various broad fields of science was as follows -

In addition to the above expenditure on research and development performed by its own agencies, the Commonwealth in 1968-69 paid $59m, mainly in the form of grants in direct support of research and development performed in other sectors of the economy. Universities received about 45 per cent of this direct financial assistance, business enterprises about 35 per cent and State Government agencies about 13 per cent.

Part of the research and development funds non-Commonwealth sources. These included overseas sources, as well as a number of research levy schemes which the Commonwealth administers. Contributors to these levy schemes support research programmes which are directed to the advancement of specific Australian industries. Approximately 10 per cent (or about J19m) of the total research and development funds expended by the Commonwealth came from these non-Commonwealth sources.

Cite as: Australia, Senate, Debates, 27 September 1972, viewed 22 October 2017, <http://historichansard.net/senate/1972/19720927_senate_27_s54/>.

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Senate27 September 1972

SOCIAL SERVICES

Petition

Senator POKE:TASMANIA

NOTICE OF MOTION

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

QUESTION

POLITICAL PARTIES’ HEALTH PROPOSALS

Senator O’BYRNE:TASMANIA

Senator GREENWOOD:Attorney-General · VICTORIA · LP

QUESTION

TAXATION

Senator TOWNLEY:TASMANIA

Senator COTTON:LP

QUESTION

TELEPHONE DIRECTORY

Senator DEVITT:TASMANIA

Senator GREENWOOD:LP

QUESTION

TERRITORIAL WATERS

Senator MULVIHILL:NEW SOUTH WALES

Senator WRIGHT:Minister for Works · TASMANIA · LP

QUESTION

UGANDA: AUSTRALIAN CITIZENS

Senator DRURY:SOUTH AUSTRALIA

Senator WRIGHT:LP

QUESTION

UNITED NATIONS PEACE KEEPING FORCE

Senator MCAULIFFE:QUEENSLAND

Senator GREENWOOD:LP

QUESTION

INTERNATIONAL TERRORISM

Senator CARRICK:NEW SOUTH WALES

Senator WRIGHT:LP

QUESTION

PRINTING INDUSTRY

Senator MILLINER:QUEENSLAND

Senator COTTON:LP

QUESTION

RACISM

Senator WOOD:QUEENSLAND

Senator WRIGHT:LP

QUESTION

PARLIAMENTARY CLOCKS

Senator LAWRIE:QUEENSLAND · CP; NCP from May 1975

The PRESIDENT:

QUESTION

TERRORIST OUTRAGES

Senator MULVIHILL:

Senator GREENWOOD:LP

QUESTION

TERRORIST OUTRAGES

Senator JESSOP:SOUTH AUSTRALIA

Senator COTTON:LP

QUESTION

ARREST OF YUGOSLAV

Senator GEORGES:QUEENSLAND

Senator GREENWOOD:LP

QUESTION

ABORIGINES

Senator GUILFOYLE:VICTORIA

Senator GREENWOOD:LP

QUESTION

COMPANY TAXATION

Senator GIETZELT:NEW SOUTH WALES

The PRESIDENT:

Senator COTTON:LP

QUESTION

DEPORTATION OF YUGOSLAV

Senator GEORGES:

The PRESIDENT:

Senator GREENWOOD:LP

QUESTION

QUESTIONS

Senator GREENWOOD:LP

The PRESIDENT:

QUESTION

ANTI-SMOKING CAMPAIGN

Senator WILLESEE:WESTERN AUSTRALIA

Senator GREENWOOD:LP

Senate
27 September 1972

Senator POKE:
TASMANIA

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

Senator O’BYRNE:
TASMANIA

Senator GREENWOOD:
Attorney-General · VICTORIA · LP

Senator TOWNLEY:
TASMANIA

Senator COTTON:
LP

Senator DEVITT:
TASMANIA

Senator GREENWOOD:
LP

Senator MULVIHILL:
NEW SOUTH WALES

Senator WRIGHT:
Minister for Works · TASMANIA · LP

Senator DRURY:
SOUTH AUSTRALIA

Senator WRIGHT:
LP

Senator MCAULIFFE:
QUEENSLAND

Senator GREENWOOD:
LP

Senator CARRICK:
NEW SOUTH WALES

Senator WRIGHT:
LP

Senator MILLINER:
QUEENSLAND

Senator COTTON:
LP

Senator WOOD:
QUEENSLAND

Senator WRIGHT:
LP

Senator LAWRIE:
QUEENSLAND · CP; NCP from May 1975

Senator GREENWOOD:
LP

Senator JESSOP:
SOUTH AUSTRALIA

Senator COTTON:
LP

Senator GEORGES:
QUEENSLAND

Senator GREENWOOD:
LP

Senator GUILFOYLE:
VICTORIA

Senator GREENWOOD:
LP

Senator GIETZELT:
NEW SOUTH WALES

Senator COTTON:
LP

Senator GREENWOOD:
LP

Senator GREENWOOD:
LP

Senator WILLESEE:
WESTERN AUSTRALIA

Senator GREENWOOD:
LP

Senator YOUNG:
SOUTH AUSTRALIA

Senator DRAKE-BROCKMAN:
WESTERN AUSTRALIA · CP; NCP from May 1975

Senator GREENWOOD:
LP

Senator WEBSTER:
VICTORIA

Senator COTTON:
LP

Senator KEEFFE:
QUEENSLAND

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

Senator GREENWOOD:
LP

Senator LAUCKE:
SOUTH AUSTRALIA

Senator DRAKE-BROCKMAN:
CP

Senator McLAREN:
SOUTH AUSTRALIA

Senator COTTON:
LP

Senator WRIGHT:
LP

Senator GREENWOOD:
LP

Senator COTTON:
LP

Senator COTTON:
LP

Senator WRIGHT:
LP

Senator WRIGHT:
LP

Senator WRIGHT:
Minister for Works · Tasmania · LP