29th Parliament · 1st Session
The PRESIDENT (Senator the Hon. Justin O’Byrne) took the chair at 12 noon, and read prayers.
– I give notice that on the next day of sitting I shall move a motion for the adoption of rules for the conduct of a joint sitting with the House of Representatives, the terms of which have been distributed to honourable senators.
– My question is directed to the Leader of the Government in the Senate. I ask him: Does he share the Prime Minister’s pleasure, as expressed by the Prime Minister during his Press conference yesterday, at the Senate’s disapproval of parliamentary pay increases?
-Mr President, I thought that today was going to be a nice day, and that is no way to start off the proceedings of the Senate. Further, the honourable senator knows that I should not be asked for an opinion on any matter.
-I ask the Minister for Foreign Affairs whether it is true that Australian citizens of Greek origin visiting Greece were at one stage, after the coup in Cyprus, subject to military call-up by the Greek Government.
-Yes. The former Government of Greece included everybody of Greek nationality, even though they might hold dual nationality, when it issued its mobilisation orders. Many people were included, particularly Australians. Because of our attitude on dual nationality we were on the point of taking this matter up with the Greek Government in respect of Australian citizens of Greek origin but the Government in Greece changed and I understand that the exit points which were closed are now open and there is no difficulty in Greek/Australians leaving Greece.
Minister for Agriculture consulted before the decision was taken to increase the excise on brandy sales as announced in the mini-Budget? Does the Minister believe that this action will further worsen the fall in brandy sales which has occurred since the last Budget and which has caused the industry to call for Government assistance to restructure the grape-growing industry away from production for brandy purposes? Would the Minister agree that this move represents a final repudiation by the Government of its promise before the election of 1972 not to impose further taxation on this industry?
– The decision to which the honourable senator refers was a collective decision taken by the Government and stands as such. It is appreciated that there are problems associated with the industry, particularly in South Australia. There have been discussions between Mr Dunstan, the Premier of South Australia, myself and the Federal Treasurer in respect of a program whereby a pilot scheme could be adopted to assist the industry to develop more suitable varieties of grapes. Those discussions are progressing. I hope that before long some finality can be reached. It would be quite erroneous to suggest that the Government is not aware of the problems of the industry. I think that the discussions which have taken place will prove eventually to be a road back for certain sections of the industry which are in fact having difficulties.
– Can the Attorney-General inform the Senate as to how long the Australian Institute of Criminology has been without a Director? Does the Attorney-General feel confident that he will be able to attract a suitably qualified person to fill the position of Director of the Institute at the present salary?
-The Australian Institute of Criminology has never had a Director. The first appointment, which was to the post of Acting Director, was of His Honour Judge Muirhead, later Mr Justice Muirhead of the Northern Territory Supreme Court. Frankly, the Government is faced with a considerable difficulty in this area. One of the results of the action of the Senate the other night in disapproving the determinations of the Remuneration Tribunal is that the salary fixed by the Remuneration Tribunal for the Director of the Institute at $30,000 has been disapproved. The salary remains at $17,792.
This Institute is an extremely important one. It was set up by the co-operative action of the States and the Australian Government. The Bill for its setting-up was supported by all political parties. A great deal of valuable work has been done. We are seeking a person of great eminence for this post. Several persons of considerable eminence have been considered for it. All I can say to the Senate is that the Government is faced with a very great difficulty indeed. Whatever one may think of the action of the Senate- I will not comment on it- I inform the Senate that this is a most unfortunate not side effect but direct effect of the decision of the Senate. I do not know whether something can be done about it, but it will be most unfortunate if something cannot be done. Let me say that this situation applies in a number of other extremely important areas which would concern all honourable senators.
-My question is directed to the Minister for the Media. Is the Minister aware of the disturbingly partisan attack on Australia ‘s security services in general which was the subject of the Australian Broadcasting Commission radio program ‘Late Line’ last Wednesday? Is an unbalanced and untrue denigration of our security services the proper function of the Australian Broadcasting Commission? Will the Minister take up with the Chairman and General Manager of the ABC the question of why this program was published and why the Australian Broadcasting Commission has not yet published a session which is favourable to the functioning of Australia’s security services?
– In the time that I have been the Minister for the Media Senator Greenwood not infrequently has been asking partisan questions about the Australian Broadcasting Commission. I assure the honourable senator once again that under this Government the Australian Broadcasting Commission is guaranteed political and programming independence. The Government has not endeavoured in any manner, shape or form to interfere with the programming arrangements of the Australian Broadcasting Commission. I am not aware of the particular program to which the honourable senator refers. However, I will mention the matter to the Chairman of the Australian Broadcasting Commission and seek his comments on the honourable senator’s remarks.
-Can the Minister for Customs and Excise tell the Senate whether his adoption of the Industries Assistance Commission’s report on building materials will have any significant effect on the Government’s by-law policy?
– Yes; although I may say that last year I announced in the Senate that the Government was applying a flexible by-law policy. As I recall it, the reference to the Industries Assistance Commission was made prior to my announcement. Consistent with that approach several matters of principle have been referred to the Industries Assistance Commission for advice on whether there should be any variation in the granting of by-law entries. The Commission in endorsing the flexible by-law policy has now established principles for by-law admission of building materials where no objection is raised by Australian manufacturers, where imports of competitive products would have had only a marginal effect on Australian manufacturers, where there are significant differences in the size, weight and profiles between imported and Australian building materials and where other factors such as price, end use, delivery times and technological advances warrant this concession. The Government has of course accepted the report. The criteria which have been referred to will, with the obvious changes, affect the consideration of other products. May I say that this is a confirmation and perhaps a refining of the policy which was announced last year.
– I direct a question to the Minister representing the Minister for Transport. Does the Minister recall the Prime Minister stating in his policy speech on 10 May this year that the Federal Government would provide $22 m for the sealing of a 2-lane highway between Port Augusta and Alice Springs? Since the Prime Minister stated that work would commence within 3 months, which period has almost expired, can the Minister say when work on this project will be commenced? If the Minister cannot say this, would he make inquiries and let the Senate know the result?
-I recall the statement having been made but I cannot say when work will commence. I will make inquiries and let the honourable senator know the answer.
-I direct my question to the Minister representing the Minister for Labor and Immigration. As Australia is a member of the International Labour Organisation, can the Minister inform the Senate of what this Government is doing to fulfil its obligations as a member of this organisation?
– Honourable senators will recall that when the present Government was in Opposition we often criticised the then Government for its failure to ratify conventions. The then Government used to argue this way: ‘We cannot ratify conventions because we have to deal with the States’. For this reason, and various others, we thought that that Government was moving too slowly in ratifying conventions. I think that it ratified about 33 conventions out of 136 formulated by the International Labour Organisation whereas countries such as France have ratified as many as 93 conventions. Since the Labor Government has been in office it has ratified 7 conventions, the most recent being that ratified by the Minister for Labor which deals with the social consequences of cargo handling methods. I think that our record on this matter is much better than that of the previous Government.
– I preface my question to the Leader of the Government in the Senate by saying that earlier today he said that he hoped for nice days. My ambition is to try to make these nice days brighter with more sunlight. In view of the fact that the Premier of Tasmania, the Honourable Eric Reece M.H.A., is to seek the approval of other State Premiers to increase by 2 months the total period when daylight saving is observed, will the Minister draw this matter to the attention of the Prime Minister so that by his support the people of the Australian Capital Territory can also enjoy the benefits of this Tasmanian instigated move?
– Everyone would take notice of any recommendation by the far sighted and wise Premier of Tasmania, and no doubt the Prime Minister will. I understand that in the Australian Capital Territory the time is governed by the Standard Time and Summertime Ordinance of 1972. Whatever needs to be done in the Territory will, as a matter of common sense, need to be done with the co-operation of at least New South Wales. I suggest to the honourable senator that the fixing of daylight saving may at some stage be done by this Parliament. After all, at
Federation it was determined that this Parliament should have the legislative power over, amongst other things, weights and measures. Clearly the fixing of time is the fixing of a measurement, and it may be that if we are so minded this Parliament might be able to avoid some of the rather ridiculous situations which have arisen between neighbouring States on the eastern seaboard.
-I ask the PostmasterGeneral whether arrangements are being made to provide fast mail services between Australia and other countries. If so, how soon can such services be made available to the general public?
-The Post Office is now considering arrangements which should provide a superfast mail service for traffic between Australia and the United Kingdom and Australia and the United States of America. It is proposed that the service should start in August. It should mean that within 48 hours of the receipt of articles in Sydney and Melbourne those articles would be delivered to areas in the United Kingdom and in the United States. There will be a pretesting period to determine whether the service will be successful or not. As I have mentioned, the service should start early next month.
– My question is addressed to the Minister for the Media. I refer to warnings issued yesterday by the Chairman of the Australian Broadcasting Control Board concerning the purchase of colour television sets. I ask: Has the Minister any information on what steps his Department is taking to issue warnings against unscrupulous operators? Are there any other plans to protect purchasers of colour television sets?
– I can inform the honourable senator that my Department, in conjunction with the independent statutory body, the Australian Broadcasting Control Board, and my colleague the Minister for Science who is responsible ministerially for Australian consumer affairs, have been engaged in detailed conversations concerning the publication of a booklet warning people about the problems that they might have from time to time in the purchase of colour television sets.
I think that in giving an address yesterday the Chairman of the Control Board, Mr Wright, mentioned that one of the first things that any person purchasing a colour television set should do is to ensure that the set is thoroughly checked in the home where the set will be used. Within the next 2 weeks my colleague the Minister for Science, Mr Morrison, will be producing a booklet- again in conjunction with my Departmentfor publication generally. We believe that as a result of the publication of that booklet and the advertising that will ensue from it, wide publicity will be given to the public about some of the pitfalls involved in the purchase of colour television sets.
– My question is directed to the Minister for Repatriation and Compensation. Is it a fact that the more seriously incapacitated of the general rate pensioners have had the amount of their compensation seriously eroded by the abolition of the special compensation allowances previously paid to them?
-Mr President, I apologise for not being able to employ the same intonation that you employed when you called the honourable senator to ask his question. At the present time the Government is endeavouring to do away with the special compensation allowance, which was introduced by the previous Government in 1968. It would appear that the special compensation allowance was introduced by the previous Government because it wished to avoid or felt that it needed to avoid increasing the whole of the general rate range of pensions. The special compensation allowance which the previous Government introduced provided for a situation in which those general rate war pensioners whose incapacity was assessed at from 75 per cent to 100 per cent of the general rate scale received this allowance. Fewer than 30,000 out of 190,000 general rate pensioners received the special compensation allowance.
There were a number of anomalies in the situation because, obviously, if the special compensation allowance was to start only with those pensioners who were receiving 75 per cent of the pension, those who were receiving less than 75 per cent would be in a relatively disadvantageous position compared with those who were receiving more than this figure. The result was that an ex-serviceman whose incapacity was assessed at, say, 70 per cent would be receiving only about 49 per cent of the total pension paid to a pensioner on the 100 per cent rate, whereas a pensioner who was assessed at 75 per cent would be receiving 26 per cent more than the exserviceman whose incapacity was assessed at 70 per cent.
I think that the question which Senator Mcintosh has asked is an important one because a number of people have been concerned about matters relating to the special compensation allowance. The Government’s intention at the moment is to increase the whole of the general rate. As a result of its increasing the general rate to all pensioners on all percentage disabilities, the necessity for the special compensation allowance is being removed. Although the special compensation allowance is being reduced in individual cases, the total amount of pension is remaining the same or is increasing in every instance. We hope and we intend that in due course the necessity for having such an allowance will be removed.
-Can the Minister representing the Minister for Transport inform me of the present position in respect of the provision of all-weather landing strip conditions at the Kingscote airport on Kangaroo Island? Is the Government still insisting on local government acceptance of responsibility for the aerodrome, including the runways? If so, on what grounds of equity in respect of the provision of air travel facilities in Australia can this attitude continue to be sustained? Further, is consideration being given to the provision of all-weather airstrips at Coober Pedy and Andamooka, where the residents have been seriously inconvenienced because of an inability to maintain essential communication with other centres, particularly in relation to urgent medical needs?
-It is the responsibility of local government authorities to upgrade certain airports and to provide all-weather airstrips where necessary, with some supervision, I believe, from and financed by the Department of Transport. The policy of local government maintaining airports has prevailed for many years; it is not only this Government’s policy. I do not know the position at Kingscote, but I will find out for the honourable senator. In the north of South Australia it is the responsibility of local government or of settlements to maintain airstrips. Very few of the areas in the north, including Coober Pedy and Andamooka, have allweather airstrips. I was surprised to hear that Coober Pedy does not have an all-weather airstrip because we landed there on one occasion in the height of the wet season to inspect the area. Nowhere, in South Australia, that we know of, has there been a problem about a lack of food and medical supplies during the wet season. This has occurred in the Northern Territory where, with the assistance of various agencies, most importantly the Army and the Royal Australian Air Force, we have been able at all times to meet the emergencies by dropping food supplies, and medical assistance at times when it has been required. Of course these days, with the development of air travel, we are getting so many smaller airstrips. This is one of the major financial problems with which the Government has to deal. I shall try to get some report on the airstrips at Coober Pedy and Andamooka and see who is responsible for them.
– My question is directed to the Minister for Repatriation and Compensation. When will he give consideration to extending the service pension provisions of the Repatriation Act to former members of the British Forces who have made their homes in Australia?
-Early in 1972 the Australian Labor Party gave an undertaking on this matter when Mr Barnard told the British Sub-branch of the Returned Services League that we would be taking steps to see that allied ex-servicemen who had resided in Australia for a minimum period would become eligible for service pensions. This eligibility still has not been extended although the social service pensions to which they are entitled are the equivalent of the service pensions but are not obtainable until a later age than the age at which service pensions are available. I am at present considering this matter not only as it relates to British exservicemen but also as it relates to some other allied ex-servicemen, particularly Polish ex-servicemen who are in a much worse situation than a number of people because they do not have a home government to which they can address representations about their situation. Of course, British ex-servicemen receive pensions paid by the British Department of Health and Social Security, I think it is called, for which the Australian Department of Repatriation and Compensation acts as an agent. I can give no undertakings at present other than to say that I am considering this matter, and shall be making submissions in due course to Cabinet with regard to extending these benefits which I think should be extended as a matter of justice.
– I ask the Minister for the Media whether we are drifting into a situation whereby the method of conducting commercial advertising services is likely to be disrupted. I refer firstly to the proposed trade practices legislation which threatens the agency commission system and would lead to the end of Media Council accreditation of agencies, and secondly, to reports that the Department of the Media intends to introduce a rating scheme for television advertising related to the introduction of a metering system. Has the Minister any information which would assure the advertising service industry that the Government’s plans will not prove damaging to future operations?
Firstly, the Trade Practices Bill comes completely within the area of control of my colleague the Attorney-General. The Bill has been introduced in this chamber and any comments the honourable senator might like to make on that matter can be made when it is being debated. As for the second part of the question, if the honourable senator reads the Broadcasting and Television Act she will see that advertising standards for the electronic media- broadcasting and television- are completely matters for the Australian Broadcasting Control Board, an independent statutory body established under the Act. As far as I am aware my Department has never suggested to anyone that there be introduced a rating system for commercial advertising in any manner, shape or form. However, I will check with the Australian Broadcasting Control Board to see whether it has anything of this nature in mind. It has never reported any discussions or information of this nature to me.
– I ask the PostmasterGeneral whether he has seen reports recently which indicate that the Post Office is investigating a new form of mail delivery which would enable mail to be posted free by the sender and paid for by the recipient. Such reports also mentioned the use of this facility by members of Parliament in their communications with their constituents. Can the Postmaster-General say what the current position is in these investigations and whether such facilities will be made available free to members of Parliament?
– I have seen the reports in the weekend newspapers but after yesterday’s debate, Mr President, you would probably expect me to give the answer that Eliza Doolittle gave but which I cannot repeat in the Senate. It is not very likely that anything of the type referred to in the reports would be done. However, there is what is called by the Post Office a free post system which is similar to the business reply system. I suppose that is where the reports have their origin. It is planned to develop and expand this arrangement so that the ordinary customers of a number of advertisers might be able to use a similar system, using their own notepaper. It would seem that that is where the reports have their origin, but the developments are as I have mentioned to the honourable senator.
-Will the Minister representing the Minister for Labor and Immigration inform the Senate what are the precise issues that threaten to precipitate the strike tonight by members of the Transport Workers Union? If those issues are in any way within the Federal jurisdiction, what steps towards conciliation and arbitration and injunction are being taken?
-I do not think at this stage that I should embark upon an answer in relation to the issues in dispute because anything I say- I know that Senator Wright has made the same observation in the past- might not help to settle the dispute but might make it worse. But during the course of the day I will get as much relevant information as I can and give it to Senator Wright. If before the Senate adjourns I am able to say anything which will not worsen the situation I will certainly ask the Minister for Labor and Immigration to allow me to do so.
-I ask the Minister for the Media: Did he see an item in the ‘Canberra Times’ last Thursday which was critical of government spending and which noted that the Department of the Media had paid $8,426 for the ‘Hector the Cat’ comic strip? In view of the implicit accusation of frivolity can the Minister say what his Department intends to do with the comic strip?
– I did see the report in the ‘Canberra Times’. My Department is producing a comic strip entitled Hector the Cat’ but is doing so on behalf of the Department of Transport in connection with a road safety campaign that that Department is conducting. I understand that Hector the cat is in no way related to Felix. The project arose as a result of a Film Australia film production of the same name which is aimed towards young children and is designed to educate them in an entertaining way in the simple procedures of road safety. That film also was produced for and on behalf of the Department of Transport. I understand that some commercial television networks are interested in looking at some of these productions and that officers of the Department of Transport and my Department have been so impressed with the Film project and with the reception of it by a large audience of young children that they have decided to proceed with the presentation of the comic strip.
– I direct a question to the Minister representing the Treasurer. Has the Minister’s attention been drawn to reports that a number of local governments in Queensland have been forced to retrench staff and that others will have to follow suit in the near future because of greatly increased operating costs, particularly wages? Is the Minister aware that substantial expenses were incurred by local governments in preparing their submissions for the Grants Commission last year? Since there has been no indication to date as to when local government will receive financial assistance through Commonwealth Government grants, as promised, can the Minister tell the Senate when an announcement on this assistance can be expected? Of course, the Minister will realise that the question has nothing to do with the recently failed referendum.
– I am not in complete agreement with the honourable senator’s final comment. It was this Government, even when in opposition, that realised the need for Federal powers to assist local government authorities in Australia. I think that to dismiss the significance of the referendum is not quite a pertinent observation to make. I am not aware of the specific position in Queensland. I shall have to refer the question to my colleague, the Treasurer. I am sure that he will be mindful to do whatever he can to assist the situation that has arisen there. I shall obtain a detailed answer for the honourable senator.
– Has the Minister for Customs and Excise seen a report in today’s Press which claims that huge quantities of faulty television sets have been imported from Taiwan by N. G. Enterprises Pty Ltd of Sydney and that these sets have been selling all over Australia in recent weeks? Will he make inquiries into the truth of these claims? If they are proved correct, will he take immediate action to ensure that no more imported electrical goods are offered for sale until they have passed the most stringent safety tests?
-I thank the honourable senator for raising the matter. I shall have it looked into immediately. I imagine that some action has been taken already but I shall ensure that it is done.
– I direct a question to the Minister for Foreign Affairs. I refer to the report of a speech delivered by the Minister on 15 June to a seminar organised by the Institute of International Affairs in Adelaide in which the Minister indicated that Australia was again looking at aligning itself with the Third World. If this be correct, and if Australia is aligned with the United States through the ANZUS Treaty, have the rules for membership of the Third World been changed or is Australia’s policy towards the ANZUS Treaty changing?
-What I did in the speech delivered in Adelaide on 15 June was to raise the question of the Third World in the context of Australia gathering more information for itself. I pointed out that up to that time the Labor Government had entered into diplomatic relations with an extra 2 1 countries, that we had observers at meetings of the Andean Pact and the Organisations of American States and that we were paying attention to what was going on in relation to the Organisation of African Unity. I said that I would seek to have Australia admitted as an observer at the Third World meetings, or the nonaligned meetings as they are known. We could not become a member of the Third World if we wanted to because, as Senator Sim pointed out, we are an aligned country through the ANZUS Treaty and also through SEATO. So there is no doubt that we would not be acceptable to that body. But I believe that we just cannot ignore these various groupings throughout the world. The whole burden of that section of my speech was to the effect that Australia should be better informed than it has been and that we should get the information, as far as we possibly can, through Australian eyes.
– Is the AttorneyGeneral aware that when it was apparent in 1972 that a change of Government was likely in the general elections the Liberal-Country Party Government approved a large number of mining applications, ignoring the conservation aspects?
Is he aware that a magnificent red gum forest of some 6 square miles at North Entrance on the New South Wales central coast is the subject of an application by a mining company seeking to exploit the rutile deposits thereunder? Is he aware that this application was rejected by the Wyong Council using its powers under the Tree Preservation Ordinances? Does he know that on appeal to the New South Wales Supreme Court by the mining company, Mr Justice Hope broadly upheld the Wyong Council’s view? As the mining company has appealed directly to the Privy Council, thereby giving British judges the right to determine this important environment issue, will the Attorney-General give urgent consideration to offering financial help to the Wyong Council in its endeavours to retain this valuable natural area for the people of Australia?
-I am in general aware of the matters referred to by the honourable senator in introducing his question. He asked whether consideration could be given to financial assistance. Yes, I will give that consideration urgently. Indeed, it seems extraordinary that a matter of such domestic concern to Australia may be taken away to be decided by a set of judges who are not appointed by us, not responsible to us and acting in a way which is quite inconsistent with the independence of Australia and its present standing in the world. This is one of the relics of colonialism which continues to poison the relationships between Australia and the United Kingdom.
-I know that that situation is supported by a number of honourable senators opposite and people in the various State branches of the Liberal Party, but I repeat that it poisons the relationship between this country and the United Kingdom that we should continue to have British appointed judges determining matters, even those of a domestic nature, over in London. I think that the Council, put in that position, certainly on the face of it ought to be given legal assistance by the Australian Government and I will look into it. On the face of it, as I say, I certainly would be inclined to grant the application to which the honourable senator referred.
-My question, which I address to the Minister for the Media, relates to his answer to Senator Greenwood in which he resorted to his constant alibi of the independence of the Australian Broadcasting Commission. Is it not a fact that the Broadcasting and Television Act demands that stations shall provide ‘adequate and comprehensive programming’? Is it not the specific responsibility of the Minister to ensure that the provisions of the Act are carried out? Does the Minister now say that the independence of the ABC as a statutory corporation absolves him as the responsible Minister from any responsibility for balance and fairness in ABC programming? Or would he not agree that independence is justifiable only if it produces objectivity of judgment and balanced programming? Alternatively does the Minister justify on the ground of independence any action, however partisan it might be, by a statutory corporation? Does the Minister suggest that the ABC should not be subject constantly to the scrutiny and the comment of this Parliament?
Answering first the last part of the honourable senator’s question, I have always adhered to the view both in government and in opposition that the Australian Broadcasting Commission is responsible to the Parliament. I have always said that. The honourable senator may recollect discussions by Estimates Committees on this subject over a period of time. On one occasion when we were in Opposition we sought from the ABC information which was denied to us be the previous Government, because we wanted to challenge some of the accounting methods then operating.
I now turn to the first part of the honourable senator’s question. If he reads the Broadcasting and Television Act he will see that it is the responsibility of the Australian Broadcasting Control Board to ensure that stations provide a comprehensive and adequate service in the best interests of the public. Additionally, in the provision of that comprehensive service the ABC will provide, in the opinion of the Commissioners, a comprehensive and adequate service. It is for me as the Minister answerable to this Parliament to answer questions on behalf of the Commission, and to answer questions on behalf of the Australian Broadcasting Control Board. But apparently the honourable senator expects me as a Minister of State to pass judgment by way of censorship on programs broadcast or programmed by the commercial stations or by the Australian Broadcasting Commission. I say to him that I certainly do not expect that to be my responsibility.
-Mr President, I wish to make a personal explanation. Shall I do so now or after question time?
– I would prefer you to make your personal explanation at the close of question time.
– My personal explanation relates to the answer just given by the Minister for the Media. I just wish to indicate that I shall seek to take that action.
– I shall give you the call at the end of question time.
– I refer the attention of the Minister for Agriculture to reports that Australia has concluded negotiations with the European Economic Community for compensation following the United Kingdom entry into that body. Will the Minister tell the Senate what benefits have the negotiations brought the Australian farmer?
-There have been discussions with the European Economic Community under the auspices of the General Agreement on Tariffs and Trade in respect of Britain’s recent entry into the EEC. An agreement has been reached that there will be a 2 per cent reduction in levies on certain Australian primary products, mainly fruits, which will enable us to be more competitive into the EEC. At the same time there has been a lifting of the quota of levyfree beef and veal into the EEC of about 4,000 tonnes. This is not a great amount, but it will enable Australian exporters of these products to have a better entry than they have had in the past. We hope that these negotiations will open the door to further relaxations in the future, but that will be a matter for further negotiation.
-The Minister representing the Minister for Labor and Immigration will recall that I raised the question last week concerning the 10,000 tonnes of steel that is rusting on the wharf at Port Adelaide due to an argument between the Transport Workers Union and the Waterside Workers’ Federation. As it would seem that the Federal Government, the South Australian State Government and the Australian Council of Trade Unions are unable to effect a speedy solution to this problem, will the Minister authorise the Army to effect delivery of this urgently required steel to contractors because I understand that unless this material is delivered very soon unemployment will be the result?
– Since Senator Jessop asked me a question about this matter last week I have asked the Minister for Labor and Immigration to give me whatever information he could about it. At that stage there was a suggestion that a wider group of interests would be convened to consider the matter. I am not sure of the current position. I am aware of the dispute and of the attempts by the Premier of South Australia, for example, and the Australian Conciliation and Arbitration Commission to make some arrangements. At the conclusion of question time I will ask the Minister for Labor and Immigration the current position. However, I suggest that the honourable senator should think twice before asking any government to use its defence Services to intervene in an industrial dispute because history has proved quite clearly that disastrous industrial consequences will result from intervention of this type.
– Are you saying they would get worse than they are today?
-No. Senator Hall’s colleague from South Australia asked me whether I would recommend that the defence Services be used to lift the cargo of steel, and I said that I thought that efforts to resolve the dispute ought to be accelerated. I said that to my knowledge- I suppose also to the honourable senator’s knowledge- there had been a recent increase of the people involved in trying to settle the dispute. The final suggestion by Senator Jessop was that we should use the defence Services and I said that certainly should not be considered in these circumstances because such action could have very complicated and wide effects. But there ought to be, I agree, renewed efforts to solve the dispute. I will do what I can to give the honourable senator the information this afternoon.
– My question is directed to the Minister for Agriculture. Did the Minister recently receive from Mr R. B. Walker, Chairman of the State Fruit Board of Tasmania, and Mr N. S. Bridge of Tasfruit Pty Ltd a request for advance assistance of $ 1 per bushel against an estimated $ 1 .72 of government assistance for this season on fruit shipped to the United Kingdom and European markets at risk? In view of the undertaking given with regard to any adjustments that will be necessary after final calculations are made and bearing in mind the current economic situation in the fruit industry and the need for orchardists not only to pay current packing costs but also to assist in the procreation of requisites for the 1975 season, can the Minister indicate when a decision on this matter is likely to be made so as to encourage a return of some degree of confidence in the industry?
– I did not receive an official approach in respect of the matter raised by Senator Bessell. I was verbally sounded outthat would be a better way of putting it- as to what my reaction would be. My reaction was a firm no, on the ground that the Australian and Tasmanian Governments acceded to the requests of the industry under the guarantee arrangements that were entered into early this year for the fruit season that has just finished. That involved an arrangement for a guarantee of $2m by both governments- making a total of $4m- up to an amount of $2 per bushel for that season. Prior to that the 2 governments had put an alternative proposition to the industry, but eventually we acceded to the industry’s requests. In fact, I think it is fair to say that we went all the way with the industry’s requests at the time. At that time there was no suggestion of first advance payments being made, irrespective of how justified that case may be. A firm commitment was entered into. I believe that it would be unreasonable to expect either government to retreat from the position the governments have taken at this stage.
– My question is directed to the Minister representing the Minister for Transport or the Minister representing the Minister for Overseas Trade. Is the Minister aware of the deteriorating situation in the port of Melbourne where up to 7 ships are now waiting for berths to unload their cargoes? Does he agree that a large part of the problem arises from a shortage of 1,500 workers on the waterfront and from the fact that no temporary labour is admitted to the waterfront to assist in moving this cargo? Is it a fact that shipping companies are now commencing to charge exporters congestion surcharges’ which, if not paid, could lead to cargo not being moved? Will he tell the Senate what steps are being taken by the Government to ease this situation which already is having harmful effects on our overseas trade?
– I will attempt to answer the question. A number of Ministers could be concerned with this question. I think that the shortage of labour relates to the stevedoring industry, which comes within the portfolio of the Minister for Labor and Immigration. As honourable senators know, waterside workers are required to be registered. The number registered fluctuates from time to time. Whilst there may be a surplus at some periods there may be an under-supply at others. Waterside workers have received redundancy payments and pensions and have been moved into other occupations because of the manpower position on the waterfront. Unless there is a reserve of labour simply hanging around for occasions of emergency, in times of heavy demand there will be periods when there is a deficiency in the number of waterside workers. The port of Melbourne was one of the ports where it was thought there would be a big surplus of labour because it was a container terminal and that system of cargo handling did not require the number of waterside workers that was required previously. Whether remedial action is necessary and, if so, what action can be taken are questions that I shall refer to the appropriate Minister, whoever that may be, to see if I can get more details for the honourable senator.
– I address a question to the Minister representing the Minister for Transport concerning air passenger services to King Island and Flinders Island in Bass Strait which between them have a population of some 4,000 people with no sea passenger service. A subsidy which enabled a Fokker Friendship passenger service to operate to these islands has been withdrawn and as a result the Fokker Friendships have been withdrawn and a 6-passenger light aircraft substituted. In view of the fact that many people who have no alternative means of leaving those islands, for whatever reason, than by air and who are psychologically unsuited to flying in light aircraft, will the Minister take some steps to encourage Ansett Airlines of Australia to restore at least a weekly Fokker Friendship service to those islands to supplement the light aircraft service?
– I am prepared to take it up with the Minister for Transport. It would seem to be an unusual procedure to make facilities available to meet the psychological requirements of intending passengers. I have some objection to flying in light aircraft but I have to do it quite a lot. I do not know whether anyone should provide an alternative service simply because some people do not like flying in light aircraft. I will take the matter up with the Minister to see what is the actual position.
– My question to the Minister representing the Minister for Social Security concerns recent publicity surrounding the proposed purchase of an IBM computer for the
Department of Social Security. Has a provisional letter of intent been given by the Department for one 370 model 168 large scale computer system worth $4m with an undertaking that a second 168 system also worth $4m will be ordered later? If so, will the Minister indicate when the funds for these purchases were approved? Was the letter of intent given before any funds were approved by Parliament? Was the letter given after open tenders had been called and, if so, how many companies tendered?
– I do not know whether Senator Baume was serious in asking such a question without notice of a Minister representing another. On the assumption that he was, I ask him to put the question on the notice paper.
-The Minister for Aboriginal Affairs might recall that on 24 July I asked him a question concerning Quail Island. I should like to quote part of his answer, which was:
We have had no communication from Aboriginal communities that they make a claim for Quail Island.
Is the Minister aware of a telegram that was sent to the Minister for Defence in Canberra and to the Department of Aboriginal Affairs in Darwin? I quote the contents of that telegram, namely:
Why have you ignored our petition and starting bombing our sacred dreaming place Quail Island? Turtle breeding is also disturbed. Gwatwa Daraniki plans confrontation unless you reconsider. Urgent.
An answer to that telegram was received. I quote the answer:
Negotiations are under way to see -
– Order! The honourable senator must ask his question of the Minister. He has given a lot of background information.
– Will the Minister treat this matter as urgent and do whatever he can to have the bombing stopped out of respect to the Aboriginal group who claim that this island is sacred?
– I knew of no claim that the island was sacred. I knew that as a protest Aboriginals went on to the island, remained on the island then left the island when the Darwin police sent a launch there to bring them back. If there is some claim that has a religious connotation I will take that question up with the Minister for Defence to see what the position is and whether anything can be done to prevent a continuation of bombing of the island.
- Mr President, I seek leave to make a personal explanation relating to a statement made by the Minister for the Media (Senator Douglas McClelland). The statement referred to an Estimates Committee and to certain action connected with that Committee.
-Is leave granted? There being no dissent, leave is granted.
-Thank you, Mr President. Very briefly, I wish to state that I was the Chairman of that Estimates Committee. It is my recollection that that Committee brought a unanimous report to the Senate, and that the report was accepted unanimously by the Senate. The report indicated that the Department concerned or the Commission had an obligation to give information to honourable senators at the hearings of the Estimates Committee. That position was never disputed by the then Minister, Senator Greenwood, who did ensure in due course, that the information was supplied to the Estimates Committee. I believe that the suggestion made by the Minister for the Media was totally inaccurate.
Sitting suspended from 1.1 to 2.30 p.m.
Assent to the following Bills reported:
Statute Law Revision Bill 1974.
Extradition (Foreign States) Bill 1974.
International Monetary Agreements Bill 1974.
– I present the report of the Interim Commission on Consumer Standards, dated 1 1 April 1974.
– For the information of honourable senators, I lay on the table the text of the agreement between Australia and the International Atomic Energy Agency on the application of safeguards in connection with the Treaty on the Non-Proliferation of Nuclear Weapons.
– Pursuant to section 1 1 of the Life
Insurance Act 1945-1973, I present the twentyeighth annual report of the Insurance Commissioner for the year ended 3 1 December 1973.
Debate resumed from 24 July (vide page 400), on motion by Senator Murphy:
That the Bill be now read a second time.
– I ask for leave of the Senate to deal with the Evidence Bill and the Parliamentary Papers Bill in the one speech.
-Is leave granted?
– Of course.
– The Bills will be debated cognately, but separate questions will be put.
-AllI wish to say is that we are quite aware that both these Bills and a third Bill, the Parliamentary Proceedings Broadcasting Bill, which will be dealt with by Senator Guilfoyle, will give proper protection to the joint sitting of senators and members next week. The Opposition is not opposed to the 2 Bills and wishes both of them a speedy passage.
Question resolved in the affirmative.
Bill read a second time, and passed through its remaining stages without amendment or debate.
Consideration resumed from 30 July (vide page 539), on motion by Senator Murphy:
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 amendement or debate.
Debate resumed from 30 July (vide page 540), on motion by Senator Douglas McClelland:
That the Bill be now read a second time.
-The Opposition does not oppose this Bill. We recognise that the joint sitting will be a unique and historic occasion in the life of the Australian Parliament. We concur in the wish of the Government to have a television recording of the joint sitting of the 2 Houses of the Australian Parliament. Naturally we hope that the telecast will be such that it will not distort the objects of the Australian Parliament nor cast any disrepute on the Australian Parliament. With these brief comments, I indicate that the Opposition concurs in the arrangements which, I understand, have been placed in the hands of the Joint Committee on the Broadcasting of Parliamentary Proceedings.
-The Australian Country Party also indicates its support for the Bill. It enables a joint committee of the Parliament to make decisions on and to have responsibility for the televising and various aspects of the joint sitting next week. Perhaps the Government found it necessary to bring in this Bill in haste, because the wording of the Bill in some areas may be subject to query. Some members may have a little apprehension about the meaning of certain words, but the Bill relates purely to a joint sitting of the Houses and we have no disagreement with that.
Senator Sir MAGNUS CORMACK (Victoria) (2.38)- I hate to disturb the unanimity which has been indicated by the 2 previous speakers, but I was a member of the Joint Committee on the Broadcasting of Parliamentary Proceedings which examined the problems relating to the telecasting of parliamentary proceedings. Its report has been presented to both Houses. The Committee places strictures on the methods of and the problems relating to the telecasting of parliamentary proceedings. I notice that the Bill contains some reference to matters of privilege. It also incorporates matters which I shall raise at the Committee stage. I submit that the Parliament, not having considered the report of the Joint Committee, has been encouraged into accepting the suggestion in the amending Bill, without benefit of any of the considerations which the Committee, appointed by both Houses and responsible to both Houses, has presented to the Parliament. I shall enumerate two or three of them so that the situation in the Committee stage can be understood reasonably well. For example, the great claim which has been made for the telecasting of parliamentary proceedings is based on a fallacy.
The proceedings in the Bundestag in Germany, for example, are telecast without interruption from the time they commence until late at night. In the Continental system of parliamentary proceedings, the speaker goes to the tribune and speaks there, and the camera is focused on the speaker in the tribune. I directed a question to some witnesses who had been asked if they would agree to come before the Joint Committee on the Broadcasting of Parliamentary Proceedings. An eminent member of the Bundestag replied that the telecasting of parliamentary proceedings was different under the Westminster system in the sense that under the Westminster system parliamentary debate is carried on in the form of a dialogue. However, under the continental system, the camera is focused all the time upon the member of the parliament in Germany who is speaking. The problem that inevitably confronted the Joint Committee on the Broadcasting of Parliamentary Proceedings was how the television cameras were fairly to convey the Westminster style of parliament. For example, what is to happen with an interjector? Although interjections may be disorderly under the Standing Orders, the fact is that the Standing Orders normally are disregarded and interjections are part of parliamentary life.
Secondly, who is to conduct this operation and under what responsibility will the moderator or manager operate in directing the cameras to be placed upon certain speakers? One individual member of Parliament could be destroyed by the malice of the person who is controlling the camera. To whom is he responsible? All these things are canvassed in the report of the Joint Committee on Broadcasting of Parliamentary Proceedings and in its supporting evidence. All this is bad enough. Even in the radio broadcasting of parliamentary proceedings we have what is known, I think accurately and properly, as the prima donna hour. That is the time regarded as the best listening period of the broadcasting of Parliament, and it is usurped by the leaders of various parties. Parliament is an assembly of men and women. There are moments of parliamentary tension, such as we had last Thursday night in discussion of the emoluments of members of Parliament, and the television camera will focus directly on the prima donna, or the prima donnas to use the plural. The other members of Parliament, who sit here equally by right as does anyone else, will not have access to the telecast. This Bill proposes to create a system for the telecasting of the joint meeting of the Parliament whereby certain individuals sitting in their places will be the people who will receive the accolade of public notoriety, if one likes to put it in that way.
This in itself is bad enough. The telecasting of parliamentary proceedings has been examined not only by a Committee of this Parliament but by other bodies also. The House of Commons, for example, has carried out experiments and has come to the conclusion that in the final analysis telecasting of the proceedings of the House of
Commons is not an effective way of conveying to the electorate, the people who elect Parliament, a true representation and an understanding of what Parliament is about. In the United States of America, committee proceedings have been telecast, but Congress so far has refused to allow its proceedings to be telecast. Worse than that- I am now mentioning a personal communication to myself- a committee of a Parliament with a Westminister type of government, having looked at the telecasting of committee proceedings in the United States, wrote to me and said that the whole system is a disaster area.
Therefore I indicate, with no further words, that I deprecate the Parliament, in pursuit of spurious publicity, moving directly into the telecasting of parliamentary proceedings. A great majority of people sitting in the 2 wings of the Parliament, the Senate and the House of Representatives, believe that they are readymade television personalities.
– Would you name them?
-No, I do not want to get into that area of personal dispute. After all, I have some friends on the Opposition side as well as on the Government side. I think that the report presented during the life of the last Parliament by the Joint Committee on the Broadcasting of Parliamentary Proceedings should be considered by the Senate with great seriousness before the Parliament embarks upon this spurious distortion of parliamentary proceedings. I give notice that during the Committee stage of the debate on this Bill I shall raise my voice in regard to certain matters.
– I think the Senate would always pay very high regard to its senior members, particularly to what Senator Sir Magnus Cormack has to say on a subject which he has investigated. Those of us who have been here for some time know that he has been extremely interested in this subject. However, I suggest to him that there is a very good reason why he should go along with the rest of the Senate on this Bill, namely, that this is in the nature of an experiment. If he is right that it would be a disaster to televise the proceedings of the Senate or the House of Representatives ordinarily, what better occasion could we have for testing the procedure?
-Is it a fair test?
-It may not be a fair test in the sense that it will not be under the exact conditions which normally operate in either House of the Parliament; nevertheless it could be close enough to it. One could visualise most of the problems. If what Senator Sir Magnus Cormack says is correct, the problems can be demonstrated during the course of the joint sitting. In some ways this will be a different occasion from a normal sitting. It will be a great historical occasion. We may, if we want to, have the advantage of seeing ourselves afterwards. The occasion may provide cause for admiration, merriment or worse but we would also have the advantage of seeing whether it is the kind of system that we want to operate as a matter of course in both Houses of the Parliament.
– I agree with Senator Sir Magnus Cormack ‘s sentiments on this question. I do not think it is right to televise the proceedings of the Parliament. I cannot see that it will be an attractive proposition for the people who watch television. I imagine that a telecast of our proceedings would not be the most exciting serial to look at on a television screen. I think that the written word or the spoken word is the best way of conveying to the people what is taking place in the Parliament.
– Your rating might be very high.
– I would not classify myself as of high rating. We know what the position is with regard to our broadcasting days. But this will be a new field in the reporting of Parliament and it might be a matter of being killed in the rush to see who will be able to speak and to be featured across the nation on television screens. The concentration of parliamentarians should be on achieving the best possible debate on the issues they feel strongly about. Other matters, such as appearing as glamour boys or, as the Leader of the Government in the Senate (Senator Murphy) said, having a screen appeal, should be of minor importance. The real business should be the parliamentary business and in those circumstances I feel that to televise this session of Parliament next week would be wrong. I am sorry to see the television of Parliament being brought into effect. Therefore, I do not support the proposal.
– in reply- I appreciate the support that the Liberal Party, through Senator Guilfoyle, and the Australian Country Party, through Senator Webster, have offered the Government’s proposal. Because Senator Sir Magnus Cormack apparently intends to speak during the Committee stage it is not my intention to reply at length other than to say merely that this is a Bill which will enable the joint sitting to be telecast if the Joint Parliamentary Committee on the Broadcasting of Parliamentary Proceedings determines that such arrangements should be made. The members of the Committee on the Broadcasting of Parliamentary Proceedings are the Speaker of the House of Representatives, the President of the Senate, Senator Coleman of the Government Party, Senator Webster of the Australian Country Party, Mr Donald Cameron, a member of the Liberal Party in the House of Representatives, Mr Coates, Mr Duthie and Mr Sherry of the Government Party in the House of Representatives and Mr England of the Australian Country Party in the House of Representatives. On this Committee there is a cross-section of members who have been selected by their various Parties.
The Committee is charged with determining from time to time the arrangements that shall be made for the broadcasting of the proceedings of either House of the Australian Parliament. Now for the first time in the history of this country there is to be a joint sitting and it is proposed that it be covered by means of the new technique of television. It is an occasion of great historical moment.
– Explain the technique.
– In what respect?
– The technique of broadcasting parliamentary proceedings. You are the Minister. How are you going to do the production?
-The production is a matter for the Committee on the Broadcasting of Parliamentary Proceedings.
– No. It is a matter for the fellow who has control of the camera.
-No. The Committee determines the hours of broadcasting and everything else connected with it. Just as I, as the Minister, do not determine what will happen in regard to the broadcasting of either House, it will not be me who will determine what will happen regarding the televising of the sittings. It is a matter completely for the Committee to determine. Senator Sir Magnus Cormack knows that.
– How can it determine it post facto?
– I understand from speaking with the members of the Committee that already they are having technical discussions with officers of the Australian Broadcasting Commission. Again I emphasise that it is completely a matter for the Joint Parliamentary Committee.
– It is a matter for the Parliament.
– The Committee is a Joint Parliamentary Committee.
– It is taking no notice of the report of its Committee.
-Do you want to have a go now?
– You are skidding around the subject. That is all I am trying to pin you down to.
-With great respect, the honourable senator is no longer the President of the Senate. I would hate to be responsible for not allowing a unique event in the political history of this country to be recorded on film, even if he is prepared to do so.
– You will get all the prima donnas on.
Senator DOUGLAS McCLELLANDSenator Sim said we might have all the prima donnas speaking. I would think to a degree that we might have the prima donnas. Someone mentioned here that prima donna hour in the broadcasting of proceedings was 8 o’clock in the evening. I am given to understand that, based on audience ratings, the prima donna hour during the day is about 4. 1 5 in the afternoon. So that is a complete myth. Who is a prima donna? The Government is saying not that the joint sitting shall be televised but that if the Joint Committee on the Broadcasting of Parliamentary Proceedings determines that committee may be televised then, subject to the arrangements that it can make, the televising may go ahead. It is no more than that. It is a matter completely for the Joint Committee.
– Over which you have no authority.
– I can remember the honourable senator, as a member of the Committee at the same time as I, from time to time conferring about arrangements being made for the shifting of broadcasting from one House to another. I think the honourable senator will agree that all members of the Committee approach the matter of broadcasting on a non-political basis having in mind at all times the welfare of the institution of Parliament and the public interest. I believe that every member of the existing Committee will approach his task in a like manner. However I understand that Senator Sir Magnus Cormack intends saying other things during the Committee stage so I do not intend labouring the debate any longer. 1 suggest we should get through the second reading stage.
Question resolved in the affirmative.
Bill read a second time, and passed through its remaining stages without amendment or debate.
Debate resumed from 30 July (vide page 594), on motion by Senator Wriedt:
That the Bill be now read a second time.
-In resuming the debate on the second reading of the Northern Territory (Administration) Bill 1974 I remind the Senate that we are deciding now in this place whether the people of the Northern Territory will be given a fully elected Legislative Assembly on or about 24 October this year. The Bill before the Senate lays down that there shall be a Legislative Assembly for the Territory consisting of 19 members. In his second reading speech the Minister for Agriculture (Senator Wriedt) said that the overwhelming bulk of evidence before the Joint Committee on the Northern Territory favoured a Legislative Assembly of from 19 to 25 members. In my opinion, 19 is the smallest practical number of members to have in a House of Parliament which is to have 5 Ministers, the normal presiding officers and other office bearers if we are to allow, as we must, for a certain number of private members or backbenchers and a viable opposition or group of independent members. Therefore there should be no criticism of the fact that the first Assembly mooted for the Northern Territory shall consist of what could be said to be the minimum number that is suitable for such a Parliament.
The Bill then goes on to delete the right of the official or appointed members to sit in the Assembly. I feel certain that the appointed members will be pleased to be let off the chore of the extra work they had to do under trying circumstances as public servants and members of Parliament, but from my observations, they did their work very well.
Another aspect of the Bill is that there are to be 5 Ministers who, with the Administrator will comprise the Administrator’s Council. The second reading speech specifically states that the
Administrator’s Council is essentially an advisory body. To my way of thinking, this is another weakness in this legislation; I shall point out others as I go along. This legislation has been hastily conceived before the report of a committee of the Parliament was available to the writers of the legislation. If there is to be a Parliament- which surely must have powers- to which 5 Ministers will be appointed who, with the Administrator- who is like a governor- will act only in an advisory capacity, how can the Parliament legislate, administer and rule the people who have elected it?
The Bill lays down that the first election of the Assembly shall be held on 24 October 1 974. This is the only reason why this Bill is being rushed in during this special session of the Parliament that was called to deal with 6 other Bills all of which have been dealt with. It will be practically impossible, if this Bill does not pass through the Senate this week, for the election to be held on 24 October. Nobody has made a promise that there will be an election by 24 October. All that was said on behalf of the Australian Labor Party during the 1972 election campaign was that if the ALP were elected to office, as it was, there would be self-government for the Northern Territory. True to its policy, it set up the Joint Parliamentary Committee on the Northern Territory in August 1973. On 20 September of that year that Committee, of which I am a member, held its first meeting. Because the work of the Committee was delayed considerably by the double dissolutionit would have been delayed in any case because a Senate election was to be held- because members of Parliament work on other committees and because Darwin, Alice Springs, Katherine and Tennant Creek are many miles away, not a great deal of progress could be made by the Committee in the period of 12 months since it started its work.
The Government that set up the Committeewe first met in September 1973- literally decided on 12 March of this year that whatever we said in our report to the Parliament there would be a Legislative Assembly of 19 members. It instructed its officers to go ahead and draw up the boundaries of the electorates. The boundaries are not mentioned in the legislation before us nor in the Minister’s second reading speech. However, the Government decided in March of this year what it would do. Now, before the Committee has had a chance to operate for 12 months, only to be fair to the people of the Northern Territory we are literally almost forced to agree to the passage of this BUI to set up this Legislative Assembly.
The only other aspect of the Bill with which I want to deal is that it makes provision for a continuity of administration in between the time of the cessation of the term of office of the official members and the present elected members until the new Parliament is drawn up. It makes provision that all ordinances now in operation and those being registered or gazetted in the interim will have the force of law while the changeover is taking place. The second reading speech of the Minister for Agriculture, which had only one notable feature, namely its brevity, stated:
The measure represents a major step forward in the constitutional development of the Northern Territory in conformity with Labor policy announced prior to the 1 972 elections.
I point out that this was not mentioned in the policy speech of the present Prime Minister, Mr Whitlam, in 1972. That is the crux of the problem. In my belief, this is an illustration of how the Party that has come into office- I do not want to be provocative- has tried to do too much, too soon, too often, and has done too much, too badly.
If I seem to be unfair in saying that the Government has acted too hastily, may I quote briefly from the ‘Northern Territory News’ of Wednesday, 24 July 1974- my thirty-first wedding anniversary. The headline reads: ‘Assembly? It’s still a mystery’, and the article states:
The President of the Legislative Council, Mr Tony Greatorex, has still to be told how the Territory’s proposed Legislative Assembly will be elected and work.
He told Dr Goff Letts (Victoria) River) -
He is an elected member- in the council yesterday that he was still waiting for the information from the Minister for the Northern Territory, Dr Rex Patterson.
That is the situation in the Territory in regard to the putting into effect of the provisions of this Bill. The Territorians can say: They know not what they do.
I do not want in any way to prophesy or give opinions about what matters and in what way our Committee will report. But I think that it is only fair to the Senate that I should give my impressions and reactions as a member of the Committee to what has thus far transpired with the Committee. I believe that a very small proportion of the population is vitally interested in the election of a Legislative Assembly. Officers of Australian Government departments with great consistency gave evidence- we were assured in most cases that their Ministers had seen their submissions- advocating an elected House of Assembly for the Territory, adding with emphasis, ‘But we should not give any of our powers away. ‘ I find it hard to understand how greater self-government can come to the Territory if departments of the Australian Government are still to maintain the powers they have now.
Members of the departments of the Northern Territory fear that they will not be given sufficient powers. They feel that the time lag in decision making because of references to Canberra will still be one of their greatest frustrations and causes of maladministration. There is a serious problem that is not touched on in the Minister’s second reading speech or referred to in the Bill. It relates to both the number and the manner of election of Aboriginal representatives in the Territory. In my belief it is absolutely essential to decide upon the number of Aboriginal representatives, the means by which they are to be elected and from what areas they are to come. I do not want to encroach upon the work of the Committee, but that is my view.
The Government has said that it has taken the first step of setting up the boundaries, but it has not told us where they are to be. There are to be 19 electorates but no mention has been made of Aboriginal electorates or of the type of electorates. The Government has not stated which voting system will be used to elect members. As the evidence of the Committee is open for public and departmental scrutiny it would be well and truly known that a number of systems for division of electorates and for voting for members have been put forward and should be given serious consideration, as happened with the Committee.
The measure and the second reading speech make no reference to local government. I express, more as a warning to the Government, my personal wish that no action be taken to cut down on the powers of local or municipal government in the Territory. Those powers must be allowed to grow in the Territory as they have grown in the States. The facts are, as I see them, that the election is to be held on 24 October, the reason mainly being because the Minister took as fact that the elected members would resign if there was not an elected Assembly by the end of this year. Those threats were made publicly and to the Committee by a number but not all of the elected members. They were sincere in their desire to force the Government into action because they believed that they should not go on holding office for a longer period than that for which they had been elected.
I am confident of 2 things, the first of which is that if the Minister or Ministers had talked to those members in a reasonable way and had given some assurance early in the new year sufficient of them would have said: ‘Right, we will co-operate to keep our present Parliament going while the Committee reports and the Government decides its full policy on the Committee’s recommendations.’ In any case, there would have been a quorum of the House available for it to carry out its normal legislative activities had the Minister or the Government waited for the Committee’s report, as should have happened. We did not set ourselves up. Both Houses of this Parliament at the behest of the Government set up the Committee with the one proviso that we inquire into and report on means by which there shall be appointed or elected a Legislative Assembly for the Northern Territory. We have been doing what the Government asked us to do. Before we have had a chance to complete our task the Government has taken action. What worries me about it quite sincerelyit has nothing to do with the Committee; I will come to that later- is that the hurried action that is to be taken will make the changeover period from partial self-government to selfgovernment in some other form much longer, more frustrating and more hazardous so far as ultimate success is concerned.
Administrative problems will be created for the territorians, their public servants and Commonwealth public servants who will be neither this nor that in respect of powers. Problems will arise for the taxpayers who will want information, just as difficulties will be caused in respect of the general services provided by public servants, State or Commonwealth. All these people will have greater problems, greater complexes and greater frustration because of this Government’s hasty and unwise activity. I do not in any way decry or deny the right and the wisdom of moving the Territory to self-government. I see that some years ahead the Northern Territory will become a State with full sovereign rights as a State, but not just yet. There is a population of about 100,000 in the Northern Territory and the number is rising, even under this Government, at the rate of about 5 per cent a year. In area it covers about one-sixth of the mainland island of Australia. It is rich in almost all potentials of primary and secondary industries and mining. It has a great future.
Our responsibility as a national Parliament is to aid and guide the Territory to self-government but we are not showing much ability at aiding and guiding when, in my view, we are literally forced into getting legislation through to bring into operation a House of Assembly that will have no power and no guidelines. Between the time that the Legislative Assembly first meets and the time that the Government issues its opinion of the Committee’s recommendations the only work that the Assembly will have to do will be to keep in contact with the Government, to put up its ideas as to the type of power, work and responsibility that it feels Canberra should hand over.
I wonder where the power of veto will rest. Will it be in Canberra, as it is now? If so, I believe that this will not be a great step forward for the people of the Northern Territory and selfgovernment in the real sense of the term should Canberra hold the power of veto as it grasps it at present. I believe that there would be little or no progress. What is to be the added financial burden to the taxpayers of the Territory who now enjoy, for instance, a zone allowance? Who is to call an election? How long will the period of office last? From whom will the powers flow? I do not want to be provocative but I wish to pose a question. If as the result of the election on 24 October there is a majority of non-Labor members of the Assembly, will the Government clamp down and say: ‘Right, you are not of our political colour. Therefore we will drown you at birth or keep you restrained*? Conversely, if there is an election that returns a majority of Labor members, will the Government say: Righto boys, here are the jobs for you to do. This is what we will let you do ‘?
This Bill will pass into law because the Opposition is supporting it for some of the reasons that I have outlined. Only history will tell whether this legislation will be a success or a failure when it passes into law. But I want to give my view as a member of the Joint Committee on the Northern Territory of the result of this legislative action by the Government. I believe that we members of the Committee should theoretically close our eyes to the fact that this legislation has become law, that there will be an election and that there will be an elected Legislative Assembly. We should carry on taking our evidence, weighing it, reporting it and making our recommendations without fear or favour regardless of what is or is not Government policy. Then it will be up to the Government to act on the recommendations of the Committee as is its right and duty. As a senator who has had much experience on committees of this Parliament, I am not one who believes that because a committee of the Parliament reports certain recommendations the Government of the day must carry them out. Committees are established only to guide, educate, advise and to some extent influence governments, not to be their masters. Therefore I sincerely hope, because the people of the Northern Territory deserve a good future, that out of a misty nothing, which this Bill is, some worthwhile parliamentary form of government will arise. The possibilities and probabilities for the Territory and the type of government that it will have are unknown and unlimited. The jockeying for positions between and within departments will understandably and rightly continue. In fact, I believe it will increase because of the action of the Government in bringing in legislation to elect a parliament when it does not know what that parliament will do, how it will do it or where or when it will do it. With those words I support the Bill.
-The Northern Territory (Administration) Bill 1974 is one measure which members of the Opposition in part are pleased to support. We are all aware that the purpose of this Bill is to give legislative force to the establishment of an elected Legislative Assembly for the Northern Territory. We are seeing history being written in that one of the territories of Australia is to be given a fully elected government of some type. We would all applaud and support such legislation.
As a member of the Joint Committee on the Northern Territory I was quite proud of the fact the present Labor Government had capitalised on the pronouncements made by the former Liberal and Country Party Administration that a fully elected Assembly would govern the Northern Territory. The Labor Government set up a Joint Committee composed of members from both sides of the Senate and the House of Representatives, in part to report to the Government on what would be the wise way to establish a fully elected Assembly in the Northern Territory. The Committee took a great deal of interesting evidence from various groups in the Northern Territory. Members of groups who gave evidence included city dwellers in Darwin, people from Alice Springs, people from the stations and Aborigines throughout the Territory. These people stated to the Committee their attitude to the legislation. I can remember well the strong arguments that were put by one group, the Aborigines in the Northern Territory, that here was an opportunity to give those wonderful citizens of Australia, concentrated in greater numbers in this part of Australia than anywhere else, direct elected responsibility on the Assembly.
The Joint Committee accepted that information and was in the process of hearing further from others who held divergent views. We were in the middle of assessing this evidence when out of the blue the Labor Party which set up the Committee sent Dr Rex Patterson, the Minister for the Northern Territory, I think it was, into the Territory to make a statement that instructions had been given to the Distribution Commissioners to divide the Territory into 19 areas and that there would be 19 members. Perhaps the evidence that had been taken by the Committee was valuable. I note that mention is made in the second reading speech of the Minister for Agriculture (Senator Wriedt) that apparently departmental officials and perhaps Ministers had been told of the evidence that had been obtained. The Minister stated:
The overwhelming weight of evidence so far presented to the Joint Committee of the Parliament of the Northern Territory favours a legislature of 19 to 25 members. The elected members of the Legislative Council unanimously favour a Legislative Assembly of 19 members. The Government supports their view that this would provide a workable legislature.
Here we have the Government, having set up a committee and having paid out public money so that the Committee could report to it, intervening during the hearings and saying: ‘We the Government have read some of the evidence; we have not read all of it; we know that all of the evidence has not been heard and we have not received your report, but because the Legislative Council itself appears to favour 19 members, we agree with that view and this is what we instruct our Distribution Commissioners to do’. So it is certain that on the promise of the Labor Party there will be a fully elected Assembly in the Northern Territory before the end of the year. I congratulate the Labor Party for getting that far. But it seems regrettable to me that the Government did not wait until the Committee had made its report. Why the Government broke into the discussions of the Committee, I will never know, but the Government apparently felt that this was the wise thing to do and that there will be 19 seats.
Great problems have arisen in the Northern Territory as a result of this pronouncement, and I do not think that the Labor Party can be particularly proud of what it has done. Obviously the Government believes that the work that the Committee was doing was just a waste of time and it did not want to hear from the Committee. The Committee was asked to report and make a recommendation on the number of seats that should make up the Assembly, but the Government certainly did not want to hear from the Committee on that point because it had apparently already made up its mind. The Minister for Agriculture, as Minister representing the Minister for the Northern Territory, concluded his short second reading speech by saying:
When the new Assembly takes office discussions will be held with the members of that body concerning future government of the Northern Territory.
Anybody who is interested in this matter will be amazed that the Government has rushed into a proposal, advised that there will be 19 seats and admitted readily, as it was admitted in the second reading speech, that no basis has been laid down for future government of the Territory. This is what the present members of the Legislative Council have criticised so greatly. The Minister went on to say in the last few lines:
It is hoped that those discussions will be able to take place with the advantage of having by then a report from the Joint Committee on the Northern Territory.
I think that this action demonstrates the frothy and frivolous thinking of the Labor Government, as the community is beginning to realise, whether it be in foreign affairs, economics or a matter as important as setting down a basis for self-determination for an assembly in the Northern Territory. The Government must agree that it has given no consideration to the basis upon which the Assembly will guide the future of the Northern Territory.
Obviously, some points need to be made clear by the Government at the present time. Surely the Minister for the Northern Territory should have made some journeys into the Darwin area or into the Northern Territory. Apparently he has avoided doing this in the past months. He should have found out from the people in the Territory what are their views in relation to this matter. It seems to me that something should be set down to explain what the position will be when this Assembly is elected. What are to be the Executive powers of the Assembly as a whole and what are to be the duties and responsibilities of the new Administrator’s Council which is referred to in the Bill? There is not one word to explain what this elected Assembly will do. Not one responsibility has yet been allocated to it. I hope that the Minister will take advice on this matter so that he can reply to some of the points I have made.
So that I and other senators who are interested in the development of the Northern Territory will be aware, I ask the Minister to point out specifically to this Senate where the Government or the Minister for the Northern Territory has set down what are to be the responsibilities of the Legislative Assembly and what are to be the duties or the responsibilities of the new Administrator’s Council in the Northern Territory. There is no indication of the role of the Northern Territory Administration after the creation of this fully elected Assembly. Where will the control of the minerals and energy of the Territory rest? We on this side of the Senate could probably readily answer that question. Whatever a fully elected Assembly means in the Northern Territory, its members can bet their last shilling that Mr Connor will not hand over one tittle of power regarding the operation of minerals and energy in the Territory.
Despite visits by a variety of Ministers to some areas of the Territory where publicity appeared to be favourable, I do not think that the Minister will be able to point out where any positive statements have been made which could be a guide to those people who are likely to stand for election and who are likely to consider whether being a part of this Assembly is worth while. I wonder whether the Senate is aware of the proposed times for the election. I acknowledge that a statement has been made by the Government to the effect that it hopes to have a fully elected Assembly by the end of this year. It is interesting to note that it is proposed that nominations will close on 1 1 October. Tomorrow we will be into August, but nominations will close on 1 1 October.
– Who is drawing up the boundaries?
-Election day is proposed for 19 October. Senator Durack broke in and asked about the boundaries. That is a very important matter and I wish to deal with it; but let me make this point first: Nominations close on 11 October and election day is 19 October. This Government knows- I do not consider that it is so stupid that it does not know- that in many areas of the Territory there are fortnightly mail deliveries. How can it be done? What this Government intends to do is to disfranchise many people in the outback areas of the Northern Territory. I ask the Minister to take some advice in order to reply on that point. Is it fair and reasonable to allow 10 days between the closing of nominations and election day; or is the Government doing it for some subtle purpose, so that those who are in the centres of concentrated population will be able to cast their votes very readily and others will not? If so, its great principle of one vote one value will clearly be demonstrated to be lost in the election in the Northern Territory. I understand that the period of 20 days between the closing of nominations and election day during the last Federal election was insufficient. It will be impossible to do this in a week. More electoral officers will be needed, as they were needed at the last Federal election. I certainly believe that it is ridiculous that such a short time should be allowed between the closing of nominations and election day.
Why has the Minister not discussed the matter with the men and women of the Territory who know? Is the Government interested only in the metropolitan areas? That may be its reputation, but surely when it is attempting to demonstrate an interest in the Northern Territory it should say something more than that. Utter confusion and dismay exist at this time, as people from the Northern Territory will state. We have heard no comments about Executive powers, about what the Administration will do, or about what the salaries or allowances will be. What encouragement is there for the introduction of this Assembly at the present time? What co-ordination has there been between the Federal and Northern Territory parliaments? Nobody knows. Let me turn to the debates that have taken place in the Northern Territory Legislative Council within the last couple of weeks. I quote from the restricted, unrevised Hansard. I cite some members who are happy to claim that they are members of the Australian Labor Party. Perhaps they will want to revise their remarks, on advice from others, before this matter is completed. When speaking on a paper relating to the Legislative Assembly, Mr Whitnall said: 1 indicate to honourable members that I wish to consider, in noting this paper, the situation that is likely to arise when- and I emphasise ‘when ‘-a new Legislative Assembly is created. The statement made by the Minister for the Northern Territory indicates his view I think that government can be arranged on the instant coffee principle. You can take 19 elected members, 2 teaspoonsful of hope and a dash of finance and you can have instant government. Of course, this is completely ridiculous.
The same member went on to say:
We have to find a method of making that legislative assembly work and that means a good deal of work beforehand. We have to look to the question of Standing Orders.
That should appeal to all of us. There are no Standing Orders for this Assembly. Yet this Government is pursuing the matter in this way. That same member goes on with a number of criticisms. Dr Letts, a Country Party member of the present Council, criticised the fact that the Northern Territory receives not much consideration by Canberra. He said:
And there were good grounds why the matter should be looked at again and why the Minister could have had further discussions with us and the people of the Territory about these things. It is very unfortunate that this was not done.
Mrs Lawrie, who has been down to this place on a number of occasions and whose views in certain instances I respect, also made criticism. I think she would claim to be a member of the Labor regime up there; I imagine she would be.
– She is not a member of the Labor Party, as the honourable senator knows. She is an independent.
– I am pleased to hear the honourable senator say that. I would like to take a run on the way Mrs Lawrie has voted. Perhaps Senator McLaren would like to comment on that when he speaks in this debate. So Mrs Lawrie is an independent. She said this:
These branches can become immediately responsible to the elected representatives of Northern Territory people and not to a far distant Minister who never now even bothers to set foot rn the place or even communicate with the people of the Northern Territory either officially or unofficially.
What a statement by a member of the Council who apparently backs the Labor Party! What a great criticism of a Minister! Mrs Lawrie goes on to say:
The honourable Minister appears to be far too busy of late to come to the Territory to discuss matters with elected members even when they have paid him the courtesy of writing to him and indicating that urgent discussions are needed.
Whilst one can say it is grand that we are seeing movements towards the establishment of a fully elected Council in the Northern Territory- all would support that view- one has the greatest regret that the Minister and the administration in the Labor Party in Canberra do not have the ability to set a proper foundation for a fully elected Council in the Northern Territory.
– As a Government member of the Parliamentary Joint Committee on the Northern Territory I rise to give my full support to the measure before the chamber. The 2 previous speakers said a lot by way of criticism of the Government for bringing in this legislation, which they declare to be hasty legislation. I know that it is important that we should get this measure through the House today therefore, like Senator Marriott, I will endeavour not to be provocative. I could say many things, but I will reserve them for another day. I want to draw the attention of the Senate to a matter of prime importance by quoting from page 1 188 of the Senate Hansard of 1 May 1973. It is there reported that message No. 30 came to this House from the other place to set up this Joint Select Committee to look into the very things that we are discussing today, one which is of prime importance being the establishment of a fully elected council for the Northern Territory. On that occasion Senator Marriott’s leader (Senator Withers) moved an amendment because the Opposition parties at that time could not agree about who should represent the Opposition in the Senate on that Committee. Senator Webster then moved a further amendment and so the matter was unavoidably delayed. Senator Withers and Senator Webster could have resolved their difference of opinion outside the chamber because the resolution had gone through the other House and they were fully aware of the terms of the message which came into the Senate. Those terms included that the Leader of the Opposition in the Senate should appoint 2 members to the Committee; but of course those honourable senators had a difference of opinion on whether they should be two Liberal Party members or two Country Party members or one of each. They could have resolved that problem and come in here and got that Committee set up. They did not decide to do that. So when the matter came into this chamber Senator Withers and Senator Webster moved their respective amendments, which the Government had to take time to consider. The matter was then pushed down the notice paper because of pressure of other business. We then went into the winter recess and the Committee was not able to operate. Had those amendments not been moved this Committee could have operated all through the winter recess and, I am sure, its report would have been tabled by now- and we would not have the problem for which we have been criticised.
Senator Webster is the Country Party senator who apparently was a little apprehensive that he might miss out on becoming a member of that Committee. Today he said he takes a very great interest in the Northern Territory. I want to remind the Senate of, and to put on record, the great interest that he took in this committee after having held up the establishment of the Committee. The Committee up to yesterday met on 28 occasions. We had 16 public hearings of which Senator Webster attended seven; we had 12 private Committee meetings of which Senator Webster attended seven. So out of a total of 28 meetings of this joint committee, Senator Webster saw fit to attend fourteen.
– What is your criticism, Senator?
– I did not want to be provocative or bring this up, but the point is that both Senator Webster and Senator Marriott, and Senator Webster’s colleague in another place, have severely criticised the Government because we have had to bring in this measure now in order to honour a promise that we made during the 1972 elections and which is part of our policy. This is where I differ from Senator Marriott. He says there is no record of the Government having said that the election would be held this year. I want to quote to Senator Marriott from the platform and constitution of the Labor Party, which members of the Opposition so often hold up when it suits them. I want to give now the part of the platform which deals with northern development. This is at page 39, going over to page 40, of the document ‘Australian Labor Party. Platform, Constitution and Rules’. I shall quote clause 5 (a).
– What year is this?
– This was the policy approved by the 30th Federal Conference in 1973. The Sente will recall that the committee was not set up at that time because of the actions of the Opposition. Clause 5(a) states:
The Northern Territory to have a fully elected Legislative Assembly before 31 December 1974, and the question of referred powers to be one for negotiation and determination before then.
So we are on record as having given an undertaking in 1 973. It is printed in our platform that we would give the people of the Northern Territory a fully elected Legislative Assembly before December this year.
– Do you always keep your promises?
– That is a promise that we are honouring. I am dealing with this piece of legislation at this time, Mr Acting Deputy President, and we are honouring this promise despite the criticism levelled at us from the other side particularly by one senator who, I have said, was not so concerned as to attend all meetings of the Committee. I want to say that as a Government member I have a record of having attended every sitting of the Committee whether it was held in Canberra or the Northern Territory. I attended those meetings because I thought it was my duty to do so, to carry out a pledge that we made to the people of the Northern Territory.
– People generally acknowledge that you attended those meetings because you have nothing else to do.
– I have plenty to do. Admittedly, last year I did not have the worries of pre-selection as did other members of the Committee. So I was able to give attention to the functioning of this Committee, as I was elected to do. Even Senator Marriott was able to come all the way from the depths of Tasmania to the Northern Territory to give his time and attention to this very important matter. Senator Marriott said today that this legislation was hastily conceived. I think that he might now realise that it was not so hastily conceived as he said it was. The other thing that I want to mention briefly was said by Senator Marriott also. I do not think he really meant it. Having known him and come to like him since I have been on the Committee I do not believe that he meant it when he said that he did not believe the Government would let the
Northern Territory Legislative Council function properly if the Labor Party had a majority of member in the Council. The Labor Government at present has a majority of members in the Council because we nominate certain members as well as having members elected. I do not think that any reasonable person would say that the Government of the day has exercised undue pressure on the Legislative Council in the functioning of its business or has ordered it to do things that it ought not do in the interests of the people of the Northern Territory. We are endeavouring now to give the people of the Northern Territory the opportunity to elect thenown members to that Council and so bring about self government later.
Senator Webster referred also to the fact that there is nothing in this legislation to indicate what remuneration will be paid to members of the Legislative Assembly. But Senator Webster conveniently forgets that under the previous Government of which he was a supporter, the members of the Legislative Council in the Northern Territory were paid a mere pittance. At least we have more than doubled their salaries. We have endeavoured to give them a salary which enables them to attend to the business which they presently have in hand and to attend the Legislative Council on the days it sits. When we have a fully elected Legislative Assembly in the Northern Territory, no doubt this Government will see that its members are adequately remunerated. I hope that Senator Webster will not promise outside this chamber that the members of the Legislative Assembly will be amply rewarded and then, when the Bill to provide for those salaries comes into this chamber, vote against it. It remains to be seen what will happen in that regard.
– Do you not think that they should be advised before they nominate what their salary might be?
-As a member of the Joint Committee on the Northern Territory I am not prepared to make any statements here today as to what findings the Committee will bring down; I am not going to pre-empt what the other members of the Committee will do. But I join with Senator Marriott in saying that the members of the Committee who have attended all of the meetings of the Committee have done a good job and that they will bring down an impartial report, and I am sure that when that report is tabled in the Parliament it will be to the benefit of the people who live in the Northern Territory. I hope that in the future this Committee will be looked back on as having done a good job, irrespective of the Parties to which the members of the Committee belong. I hope that once we table the report a lot of good sense will flow from it. Even though the Legislative Assembly will have been elected, we will have other work to do. I am sure that the members of the Committee and the Government that set up the Committee will be given due credit for what they have done. I know that it is important to get this legislation through the chamber. As I said earlier, I will reserve for another occasion a lot of my comments which would answer some of the unjust criticism that has been levelled at the present Government. I fully support the measure before the chamber.
– in reply- It is apparent that the Opposition supports the legislation, and I believe that that is the fundamental point. We all recognise the need for this elected body in the Northern Territory. But from listening to the debate it appears that the criticism of the Government’s action centres on the fact that this decision to provide for a fully elected Legislative Assembly in the Northern Territory was taken before the Joint Committee on the Northern Territory makes its report. I was interested to listen to Senator McLaren ‘s account of what transpired last year and of the reasons why the Committee was so long in getting under way. I accept, in good faith, all that he has said. Perhaps it makes us realise that there are reasons not known to all of us as to why the Committee could not report before this time. Added to that, of course, was the fact that the double dissolution of the Parliament took place. Although that double dissolution was not brought about by the Government, nevertheless it precluded the Committee being able to report before this legislation was presented to the Parliament. Naturally the Government would have preferred to have the Committee’s report before this legislation was presented.
We are not debating the principle of the establishment of the elected body. What we are concerned about are some of the more minor matters, such as the procedures which this Legislative Assembly will follow and salaries. But the Minister for the Northern Territory (Dr Patterson) made it quite clear that the Committee ‘s report, in conjunction with his own discussions with the members of the Assembly when they are elected, will form the basis of the procedures that will be adopted. In other words, the Committee’s findings will not be wasted. The Minister, and I am sure those who will be elected to the Assembly, will rely heavily on what the
Committee recommends. So it is quite erroneous to suggest that the working of the Committee is being usurped in any way. We know it is essential that this legislation should be brought on for debate. It is unfortunate that we have been caught in the situation where the Committee has not completed its findings.
It also should be made known that the present elected members of the Legislative Council did not want any extension of their terms of office beyond that for which they had been elected, that is, beyond 23 October next. They believed that it would not have been a proper function on the part of this Government to have extended their terms of office, and I think that this was a very sound principle that they adopted. So all in all, we have the position where there is unanimous agreement that there should be an elected body in the Northern Territory, and the legislation provides for it. The Joint Committee on the Northern Territory will report shortly, and the findings of that Committee will form the basis for discussions which must be held later. In view of the fact that there is no opposition to this legislation, the only other point I wish to add is that the Minister for the Northern Territory has a submission on the question of the salaries and allowances for members of the Legislative Assembly about to come before the Cabinet. It is hoped that an announcement concerning that matter will be made fairly shortly and before nominations close for the election for the Legislative Assembly.
– Is that as a result of evidence to the Joint Committee?
-I can not speak specifically for my colleague, but I assume that he would have taken account of the evidence that has been put before the Committee. I think that would be a reasonable assumption. In all, I believe that the legislation which we will pass today will be of benefit to the Northern Territory. An elected body in the Territory is something that we all basically want to see. Once this legislation is passed through the Parliament we can say that the Northern Territory is on the road to the thing which I think most of us want to see, that is, a properly elected Legislative Assembly.
Question resolved in the affirmative.
Bill read a second time.
– Can the Minister for Agriculture (Senator Wriedt) advise us now as to what instructions the Government gave to the distribution commissioners in respect of the delineation of boundaries of the 19 electorates in the Northern Territory, or would it be preferable for him to arrange to have the documents tabled?
– The Distribution Committee for the Northern Territory was appointed pursuant to section 4CB of the Northern Territory Administration Act. In view of the wishes of the elected members of the Legislative Council that the Territory should have a fully elected assembly as a matter of priority and that there should be 19 seats in that Assembly, my colleague the Minister for the Northern Territory (Dr Patterson) asked the Distribution Committee for the Northern Territory to be ready at short notice to recommend the distribution of the Northern Territory into 19 electoral districts. It is my understanding that the Government moved as quickly as it possibly could, but it had to bear in mind the responsibilities that were upon it to ensure that the method of distribution was properly considered. That is as much information as I can give Senator Marriott. If that is not sufficient possibly I could obtain more information for him at a later stage. Perhaps he could indicate whether I have answered the question that he has asked.
Bill agreed to.
Bill reported without amendment; report adopted.
Bill (on motion by Senator Wriedt) read a third time.
Debate resumed from 18 July (vide page 277), on motion by Senator Cavanagh:
That the Bill be now read a second time.
-The Opposition supports the Bill which relates to the construction of the Googong Dam which will supplement the Canberra water supply. We understand that the cost of construction of the dam will be $26.5m and that the projections to 1985 indicate that the dam would have a sufficient water capacity for the area. The dam is not likely to fill before 1977. The existing water storages are expected to be sufficient only until 1 975 or 1 976. This fact leads us to the conclusion that Canberra could face a shortage of water during 1976 and 1977 if the rainfall in that period is below average. This leads me to ask: What long term plans are being made to cater for the projected population of 450,000 in or about 1982? It seems that the forward planning includes certain projections, and we see some disparity between supply and the future demand of the increased population.
We were impressed by the environmental impact statement relating to this project. It has set out in very fine detail many of the problems of a construction of this nature, which eliminates the need to ask many questions which could arise. It is interesting to know that this project has had all the usual problems which arise with matters of construction or building in present circumstances. It has had the difficulties of a union green ban and all sorts of difficulties which arose because of environmental concern and the threat of pollution from the Captains Flat slag dumps. The ban was lifted after an assurance that the pollution effects would be limited and that they had been noted at the time of the construction plans. The strongest reason for the dam project proceeding is the threat of inadequacy of the future water storages in Queanbeyan and Canberra if the construction of the dam is delayed. For this reason the Opposition wishes to give a speedy passage to the Bill. We understand that it is necessary to call tenders for the project in or about September this year if there is not to be a further delay due to the seasonal requirements associated with the construction of the project.
I was interested to learn that in March of this year the unions negotiated bonus wages on this project. I was also interested to learn that the Federal Government is not concerned about the apparent extra costs because this project is regarded as requiring the payment of special allowances which will add several hundred thousand dollars to the cost of the project. I question that negotiation and seek information on the need for a special requirement for wage bonuses in the construction costs of this project, as it would seem to me that this information should be supplied for our consideration.
It was of interest to me that the environmental impact statement relating to this project suggested certain limitations on information which could be obtained and that the statement was the best that could be prepared in view of some of the difficulties. Apparently conclusive statements on some of the environmental effects of the Googong project can be made only on completion of some very expensive laboratory and field tests which need to be undertaken on the site. I express the concern of the Opposition at any pollutant or environmental difficulties which perhaps have not been foreseen or which have not been fully covered by the environmental impact statement relating to the project. The fact that sewage effluent from Queanbeyan and other areas was mentioned by the Minister for Aboriginal Affairs (Senator Cavanagh) in his second reading speech as requiring attention is rather interesting, as we would want assurances that those matters have had proper attention at the time of the planning of the project.
We have noted the remedial works which will be undertaken to improve the quality of the Molonglo River. We think that it is a desirable feature of the project, but I ask: What will be the future position of the residents of Queanbeyan, and what arrangements have been made to protect their interests? The cost of this project, as I understand it, will be borne by the water consumers of Canberra and Queanbeyan. In this regard there is a relationship between the Federal Government and the New South Wales Government. There have been negotiations about ownership of land and the acquisition of land. I seek an assurance that all aspects of New South Wales laws, as they are related to the construction of this project, have had the attention of the officers of the Department of Urban and Regional Development. I know that there have been extensive negotiations with the New South Wales Government and the various departments which would have an interest in this matter, but I am particularly interested in the protection of those residents in Queanbeyan who have future requirements and who necessarily now have an association with the Australian Capital Territory for their future requirements.
It is disappointing that the construction of this dam has been somewhat delayed. We understand that the program which is now unfolding could lead to a shortage of water in the year prior to the commencement of operation of the dam. The Opposition wishes the construction to proceed without delay. We hope that all the aspects which I have mentioned as matters of concern have been given careful attention and I seek in the Minister’s response the assurances which I have outlined. The Opposition supports the Bill.
– I wish to associate my Party with Senator Guilfoyle ‘s remarks on this Bill. The State from which I come, Western Australia, is looked upon as a dry State. I understand that it has less than 10 per cent of the water potential of Australia and that more than half of that potential is in the northern part of the State.
It is quite obvious that we must support these water supply schemes. My Party has always tried to do so. It is obvious also that if Canberra is to develop as has been planned it must have adequate water resources. I have great pleasure in supporting the Bill.
– When the Minister for Aboriginal Affairs (Senator Cavanagh) is closing the debate I would like him to indicate to me the liaison on conservation aspects which the dam authorities will have with other river commissions. He knows that Dr McMichael of the Department of the Environment and Conservation is a member of the River Murray Commission. I have a question on notice about a wetlands survey. I seek an assurance that the commissioners operating this dam will co-operate to the fullest possible extent. The Minister’s advisers will know what happens in the United States from time to time. I instance the position in the Everglades, in respect of which decisions had to be made on river levels and the effect that those levels would have on the general marine and bird life. I do not put that forward in a Utopian fashion but I would like that question answered if we, as a Government, are rightly concerned with co-ordination. I hope that when all this tree planting takes place there will not be an obsession with pine trees but that other varieties will be used. I leave those 2 points to be answered by Senator Cavanagh in his usual brisk style.
– in reply- I thank the Opposition for giving this Bill a speedy passage. We agree with the remarks that it is long overdue. This work should have been commenced before. So much has been done since this Government came to office, as one speaker said today, and possibly this project should have been planned and prepared long before. Having got off to a late start, we are trying to hurry this Googong Dam project so that we will have an adequate supply of water. We are cognisant of the possibility of some water restrictions between 1976 and 1977 until the dam fills. That brings me to the first question which Senator Guilfoyle raised about the future of this growing city after this dam is built. I am advised that already forward planning for the next project, based on reports developed for the Googong project, is proceeding for the Queanbeyan and Canberra areas.
The next question which apparently is a matter of concern related to some demand by the unions for an extra allowance for this job. This is an industrial area in which I have had some experience. Possibly the construction authority will be the Department of Housing and Construction but even within that Department there has been, on most occasions in recent years, agreement as to on site allowances. I recall the Black Mountain tower project.
– Please do not mention that one.
– I refer only to its industrial aspects. There is an on site allowance for that job to take in the disabilities which may be encountered. The Government has a competent industrial sector in what is now the Department of Housing and Construction which is prepared to agree to allowances which are appropriate to similar areas according to the disabilities which may be discovered on a particular site. On site allowances are today part of construction work. All honourable senators know the environmental difficulties involved in this project and these have been thoroughly canvassed in some detail. An environmental impact statement was prepared in conjunction with the Department of the Environment and Conservation and it has been circulated. There were some complaints about a shortage of that statement and one was placed in the Parliamentary Library. All these things have been taken into consideration.
Another question related to the effect of this project on the residents of Queanbeyan and their security for the future. I assume that the question refers to the cost to them of the Googong water. The information I have says that the cost of the Googong water supply project will be borne by consumers in Canberra and Queanbeyan. The method of financing will be worked out to spread the cost over a reasonable length of time. The estimated cost to consumers of the Googong water, based on 1972 design reports, is 15c per thousand gallons of water used. Of course, assessments will be made when the dam is finished. In about 1982 the cost will have to be assessed on current prices. The sale of water to Queanbeyan will be arranged by my colleague the Minister for the Capital Territory (Mr Bryant) who will be the selling authority.
I think that brings me to the continual worry of Senator Mulvihill about protecting flora and fauna and the adoption of proper conservation practices. I have a note that this is being worked upon now. There is liaison with the New South Wales Water Conservation and Irrigation Commission which is experienced in handling other waters. Landscaping, including the planning of trees, shrubs and grass, will be carried out around the dam.
– What variety of trees will be planted?
-I cannot give you that information. This is one of the questions which will be discussed with the water conservation organisation.
– We would like some paper bark trees.
-We will take that suggestion into consideration and convey to the organisation concerned your somewhat expressed hostility to pine trees and your preference for paper bark trees. Screen planting will be provided for the pumping station and the water treatment plant to reduce the impact of those structures on the environment. Road shoulders and embankments will be sown with native grasses. Damage during construction will be reduced by strict control during the contract period and the surrounding landscape will be restored. Similar landscaping will be carried out in conjunction with the viewing and picnicking facilities which are to be provided for visitors. Care will be exercised in the preparation of the upper margins of the immediate area where the aesthetic effect of low water conditions is difficult to ameliorate. However, planting can and will be arranged so that the near shoreline is not seen in long continuous stretches. I think that there has been effective planning and again I express my appreciation of the co-operation extended in passing this Bill through the House.
Question resolved in the affirmative.
Bill read a second time, and passed through its remaining stages without amendment or debate.
Debate resumed from 23 July (vide page 345), on motion by Senator Murphy:
That the Bill be now read a second time.
-Mr President, I take it that the Senate can deal with this Bill and the Customs Bill in a cognate debate?
-Is leave granted for the Excise Bill and the Customs Bill to be dealt with in a cognate debate? There being no objection, leave is granted.
-The Excise Bill and the Customs Bill are designed to restrict profiteering when periodical increases are made in customs and excise duties. Firstly, they empower the Minister for Customs and Excise to declare a customs clearance restriction period on particular goods or classes of goods and to impose a quota on the quantity of goods that a person or company may clear for home consumption during the declared period. Secondly, the Bills permit variation of customs duty rates by gazettal when the House of Representatives is not sitting. The Opposition Parties do not oppose these Bills. I think it is only fair to say that there is no secret that speculation and profiteering do take place on customs and excise increases, especially at Budget time. Obviously every attempt should be made to stamp out the practice and we welcome the limiting effect which these measures should have.
When this legislation was being dealt with in the Committee stage in the House of Representatives the Opposition sought to amend clause 6 of the Excise Bill. The purpose of the amendment was to prevent a revocation or variation of the quota order from causing increased financial liability to any person acting in good faith with respect to declared goods. The Opposition in that House pointed out that established quotas given to merchants or importers could be exhausted through heavy demand. In that event merchants could be forced to clear goods in excess of their quotas within the prescribed period at a price based on a certain level of duty. Should the duty rise they would have to subsidise the rise out of their own working margins. The Minister in charge of this Bill in another place said that the protection sought in the amendment clearly existed already in the provisions of the Bill. We do not intend to move a similar amendment here but I ask the Minister for Customs and Excise (Senator Murphy) to assure the Senate that the Bills do in fact grant the protection the Opposition requests. If that is the case the Opposition wishes the Bills a speedy passage through the Senate.
– in reply- I have just inquired from those who are experts in these matters of administration and who are advising me and I can give that assurance to the honourable senator.
Question resolved in the affirmative.
Bill read a second time, and passed through its remaining stages without amendment or debate.
Consideration resumed from 23 July (vide page 346), on motion by Senator Murphy:
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.
Debate resumed from 24 July (vide page 415), on motion by Senator Wriedt:
That the Bill be now read a second time.
– When this Bill was introduced I spoke very briefly on behalf of the Opposition. I indicated that we had a great interest in it and would be taking it quite seriously and seeking to examine it purposefully. That is what we propose to do now. It is in essence a Bill to establish what one might call a central monetary authority. It is more aptly described as that than as a Financial Corporations Bill. I do not quarrel markedly with the title but I observe that in my view it is essentially a piece of legislation of a monetary authority type. There are many of us who believe that in Australia some such legislation has been necessary for quite some time.
It is fair to remind ourselves that until the concrete pipes case or the Rocla case it was judged almost impossible for the Commonwealth to have sufficient power in itself to bring down such a measure. There was some argument in earlier days in which I was involved that something might be done by way of amendment to the Banking Act, but that came under the same constitutional test. I again remind us all that the concrete pipes case was really the bench mark which decided that the Commonwealth in its own right could establish a greater degree of inspection over the whole monetary scene and in effect could create what might be called a monetary authorities type approach.
This sort of measure is a necessary corollary to a reserve or central bank situation in a nation like Australia- a country with a sophisticated economy which is developing rather fast and which, although it is not large, as a trader and a country of economic consequence has a position in the world scene higher than its population might otherwise justify and is more subject to the problems of world trade and world monetary movements than are many other countries whose production does not pass into world trade to anything like the same extent. It is fair to observe on an objective examination of the measure that there has been a notable proliferation in the Australian monetary scene of institutions dealing in money or purporting to deal in money. In contrast to the very small number of banks operating under the Banking Act, and therefore subject to a much greater degree of regulation, inspection and control, there has been a growing number of large non-bank financial institutions.
It is estimated by the Treasurer (Mr Crean) that there are operating in Australia about 1,000 finance company groups which are involved in the monetary scene very much, 200 permanent building societies which have been taking increasing shares of deposit money over the past few years, 750 credit unions and credit cooperatives the expansion of which is a growing feature of the monetary scene, between 50 and 80 corporations operating generally in the merchant banking area under the 2 general heads of acceptance houses and issuing houses. Some of this last group are highly reputable, highly established and strongly based with great access to foreign expertise, know-how and funding and some of them are not quite so well known and therefore to some extent need a better degree of understanding by those in the Commonwealth charged with the responsibility for monetary and economic well-being. In these particular expansion areas not based on the traditional banking activities which are operating under the Banking Act it is not proposed to have any statutory reserve deposit regulations. In other words it is not proposed to call their money up to statutory reserve deposits. But there is expected to be a general control over their lending policy and interest rates structure and their asset ratios.
As I think is well known to all, the Opposition has taken a serious interest in this measure and in both this chamber and the House of Representatives has indicated its broad support for the measure. It is in that context that we are debating this Bill this afternoon. I hope that the position will become further illuminated by contributions both from my side of the Senate and from the Government side of the Senate as the debate progresses. I think that it is important when one has regard to the Australian monetary scene to note the injunction to the Reserve Bank of Australia which reads:
It is the duty of the Board, within the limits of its powers, to ensure that the monetary and banking policy of the Bank is directed to the greatest advantage of the people of Australia and that the powers of the Bank under this Act, the Banking Act 1959 and the regulations under that Act are exercised in such a manner as, in the opinion of the Board, will best contribute to the stability of the currency of Australia, the maintenance of full employment in Australia, and the economic prosperity and welfare of the people of Australia.
Mr President, you will conclude from that injunction that a great responsibility and charge is placed upon the Reserve Bank which no governor or board of the Bank could afford not to observe. Management of an economy rests upon considerations of monetary and fiscal policy. The implementation of the monetary policy under the broad guidance of the government of the day and the Treasurer is very much the concern and responsibility of the Reserve Bank, acting as it does as a central bank. I think that we would probably all agree that in the latter years there has grown up a much greater reliance upon monetary policy as an economic regulator than is fully justified. Monetary policy regulation tends to be rather slow to act, and a little draconian when coming in and rather slow to produce recovery when recovery is called for. It is a blunt instrument of economic management and I think that it has had to be over-used in Australia over the years. I think that we would be better off if it were not relied upon quite so much by those who are in charge of our economic affairs.
I suppose politicians have to admit totally as a body of people to some degree of responsibility in this scene. There is a notorious tendency for parliamentarians to want to do lots of things for the people of their country. They want to be able to spend a great deal of money and create great benefits for the people. But they are not necessarily always prepared to pick up the political odium of gathering in the revenue for the purpose. Hence, we have consequential deficit budgets, undue reliance on monetary policy and things of that character. In the end, a responsible democratic government has to be able to get the revenue for the purposes of government expenditure. It may seek for a period, if it wishes to do so, to defer that collection by some form of deficit budgeting. But in due course it must come to account, otherwise an inflationary process begins to take over and, in effect, acts as a regulator in a most undesirable style. But I believe that as parliamentarians we have to be prepared to help the total body of government, whether or not we are of its political flavour, for the general well-being of our country to try to get a proper mix of monetary and fiscal policy responsibilities to cover the programs of government that the people want and which the government has in effect undertaken to provide for them.
From that, I argue that in a context and a country such as this we need to have a strong monetary arm. This is because of the general reluctance of people to gather revenue from what might be called the tax area which is far more direct and far more unpopular. Therefore, the proposal that is contained in this legislation to strengthen the monetary arm has to be viewed in the context that this is a difficult and sophisticated economy and an economy with problems. That strengthening is desirable in the total context, although there are some areas of it that give rise to concern,as I will later relate.
I have a statement of the assets of financial institutions which demonstrates the pattern of change through the years. Undoubtedly, the Treasury would have later figures but these are the latest figures that I have been able to acquire from a published source. At the end of the 1953 financial year, all banks consolidated, held under their general area of authority approximately 70 per cent of the total assets held by financial institutions. As such, Government monetary policy, acting under the Banking Act, through the banks and under Statutory Reserve Deposits was able to have a greater measure of ability to help in the monetary scene than it had at the end of the 1972 financial year. At that time the proportion of the total assets held by the banks- that is, those institutions acting traditionally as banks- had shrunk to 45.2 per cent of the total assets of financial institutions. The accumulations had taken place in many other areas such as life offices, pension funds, finance companies, building societies both permanent and terminating, and non-life assurance companies. There was a slight decline in the deposits held in the pastoral finance area, and an increase in the short-term money market and the merchant banks.
For some time the argument has been advanced in Australia that one way to handle the problem in the Australian economic scene is to take one’s hands totally off the position, leave the money alone entirely, do not control or take authority over anything, stay completely out of the game and let the situation work itself out. I have never been persuaded that that approach would work; I am not persuaded now that it would work. But if ever it would have worked, I do not think that there is any prospect of its working in the conditions prevailing today, particularly with the velocity of movement of money around the world, the quick transfer of reserves and the difficulties of handling a scene in which you are really protecting your country’s currency and its prosperity in the light of the charter given to the Reserve Bank as an instrument of monetary and central banking policy.
Mr President, you will see, as I have mentioned, that the area in which there is an ability to supervise this movement responsibly has decreased through the years. It is now being increased. As far as I can judge the situation, we would be looking at a position in which government supervision of the money market would rise to the level at which it had been previously, that is, around about 66 per cent or 67 per cent of the total money market. But there is another area referred to by the Treasurer in his second reading speech. He referred to the other kinds of institutions such as pension funds, building societies, life offices and general insurance companies. The Treasurer states that because of other legislative means at his disposal he is able through the Treasury and through other Commonwealth instruments to exercise a reasonable degree of authority over the scene. If that is the case, it can be argued that with the combination of the present banking position, the areas covered by the Financial Corporations Bill and the other areas of financial supervision referred to by the Treasurer, it would be possible to control approximately 96 per cent of the total monetary scene. I do not think that that is a strictly correct interpretation of the position. It is statistically correct but there is a lot of money moving around in the system through the inter-company money markets. I do not see how we are able to obtain any degree of regulation or inspection of this money. That will be a later task for an enlightened Treasury. I am sure that the Treasury knows about this matter and that it has thought about it. But statistically it would appear that the combination of measures would make it appear that the Government has the ability to control about 96 per cent of the total monetary scene. Inter-company money might be a much more difficult thing because it is not able to be quite so easily looked at, moved about, changed and adjusted.
We have a great number of amendments to this legislation which are available for circulation. They are designed, in the view of the Opposition after careful study and thought, to try to remove some anomalies, to improve certain areas and to include some review and return sections which are designed to be constructive and protective to the people of Australia, the Parliament of Australia, the charter placed upon the Reserve Bank and the general need for the Reserve Bank to observe its charter and for us to be conscious of its need to do so. These amendments will be brought forward a little later and will be moved separately. As I have said, they are designed to be thought about carefully. The Financial Corporations Bill which is before us is really what I might call an umbrella design Bill. It is a general supervisory piece of legislation which, in effect, overrides the areas of control of those institutions that are listed in the Treasurer’s second reading speech. I do not need to refer to them because honourable senators would know what they are. Beneath that general area of supervision there will be a number of regulations designed to take up certain aspects and areas of the business in order to bring it under inspection, increase the state of knowledge of the area and where necessary to have some degree of authority to handle it in what is considered to be an overall better style. The Treasurer said in his second reading speech:
The purpose of the Bill is to provide a basis for the examination and, as necessary, regulation of activities in the nonbanking financial sector in the interests of the effective management of the economy.
That is clear. It provides the basis for examination and as necessary- I underline the words ‘ as necessary’, and as I read the Treasurer’s second reading speech and listen to people who have to deal with the Treasurer on these matters I believe the ‘as necessary ‘ part is important; there is no wish, I am told, to be heavy handed because the only wish is to know what is happeningwhen action is called for to be able to take it, but not to take action for the sake of taking action. The general purpose is the regulation of activity in the non-bank financial sector in the interests of the effective management of the economy. The non-bank financial sector in effect becomes part of the monetary authority area. The traditional trading banks operate under the Reserve Bank and statutory reserve deposits and the non-bank sector, which includes financial corporations, other institutions and life offices, under the 30/20 rule with other safeguards. It is proposed by this Bill that the Government will be able, as a government, to safeguard and effectively manage the economy.
The legislation contains certain principles. Firstly it provides for the obtaining, and where called for, publishing of information. We have been told by the Government, and I am prepared to accept it, that there has been a notable gap in areas of information available to the Government to enable it to know what is happening in the money market. It is proposed that it will be able to seek information and, where it is regarded as sensible, to publish it. This will add to the volume of evidence available to those interested in this particular field who lack the ability to secure information and who want more up to date evidence. This legislation seeks to give the Government adequate control powers over non-bank financial institutions- powers in line with those now existing in regard to banks. This is not strictly so, but is very much so. There will be no statutory reserve deposits but there will be interest rate controls, lending policy directions and asset ratios to be maintained.
There is need for consultation and there is provision for the Treasurer to appoint committees to advise him on areas to be covered by regulations before those regulations are made. It seems to me that that is a good arrangement. There is also provision for the Reserve Bank regularly to consult with associations that are involved in the area we are now considering- financial corporations. I envisage that just as the Reserve Bank now talks to associations of bankers it will confer with accepting and issuing houses, superannuation funds, life offices and other bodies involved in other activities including pastoral finance. There will be the opportunity for consultation to determine what is happening and to use the knowledge acquired for the best purposes.
It has been said that the Government attaches considerable importance to voluntary cooperation and consultation in economic management. The Opposition regards this as important and it is a delight to the Opposition to see this socialist government, social democratic government- call it what we will- beginning to espouse the principles of co-operation and voluntary work across the whole financial and monetary sector in Australia. I hope that this will result in the solving a lot more quickly of many of the present financial problems. As I have said, regulations will be framed and introduced only after consultation with interested bodies.
As a result of all the proposals there will undoubtedly be substantial change in the area of government power and equally in the area of government responsibility. No government would take on such power and responsibility lightly because it is involved in an area of increasing difficulty and increasing responsibility where mistakes that are made will lie at the door of the government and its instruments. Mistakes that are made cannot be shrugged off and the responsibility put onto somebody else’s shoulders. The Opposition believes that this extra power, which is quite massive, must be under restraint, under scrutiny and under a power of recall and constant renewal. To this end the Opposition will be moving a fairly substantial amendment. I know that some people will feel that in some areas of government responsibility they do not want to do this but I suggest that in the interest of the country and in their own interests there is great wisdom in providing in an area of this magnitude that responsibility must be under constant parliamentary scrutiny and constant inspection and renewal. This is something of which the Parliament should regularly take note.
As I think all honourable senators are aware, for many years I have believed that the Senate has a great responsibility to take a detailed interest in what I call longer term monetary and economic policy matters. I am not arguing about the ordinary services of government or the power of a government elected to raise revenue for its purposes. I argue that the Senate, with the longer term characteristics of its membership, should identify itself more specifically with considerations of monetary and economic policy that have a longer effect and a longer impact. This is how I so argue this evening. I want to again quote to the Senate and my colleagues the charge upon the Reserve Bank, because this charge also lies upon the Government that proposes with our support, that the effective power of the Reserve Bank be increased. I again quote the Reserve Bank charter because it seems to me to be one of the over-riding and important aspects of the Australian monetary and economic scene. It states:
It is the duty of the Board, within the limits of its powers, to ensure that the monetary and banking policy of the Bank is directed to the greatest advantage of the people of Australia and that the powers of the Bank under this Act, the Banking Act 1959 and the regulations under that Act, are exercised in such a manner as, in the opinion of the Board, will best contribute to the stability of the currency of Australia; the maintenance of full employment in Australia; and the economic prosperity and welfare of the people of Australia.
I simply observe in passing that the kind of inflation rates we now have and which are predicted by some to go even higher- one economist has predicted a rate of 40 per cent- will substantially undermine the currency of Australia. The responsibility for that position, if not corrected, will lie with the Government and its instruments, including the Reserve Bank.
I want now to refer at some length to a notable occasion in our parliamentary history. I refer to the fact that the Governor of the Reserve Bank may be summonsed before the Senate in certain circumstances of economic, monetary or currency gravity. This happened on a previous occasion when Sir Robert Gibson, the Chairman of the Commonwealth Bank, as it then was named, was called before the Bar of the Senate. This was during a time of great economic difficulty in Australia. The government then had to consider whether Australia should send gold to London to pay a debt or whether it should default. This was a matter of great consequence. It is notable that Sir Robert Gibson, the Chairman of the Commonwealth Bank which was then, I suppose we could call it, the central reserve bank- it was actually the principal instrument of government banking- was summonsed before the Senate to discuss with senators the consequences of what was happening in Australia in terms of its economy, its prosperity and its currency. The date was May 193 1 .
– He gave Mr Scullin wrong advice.
-He may have done. Some people lately have been saying that Mr Whitlam could be another Mr Scullin.
– Are you saying that the Treasurer gives Mr Whitlam wrong advice?
-No. That is for you to say. The instruments of government are yours to command, to activate and to respond to. The Government can take advice or deny it. In the ultimate the Government must stand responsible. It cannot evade its responsibility. There is some interesting evidence of this occasion of great parliamentary importance. I think it was one of great parliamentary significance, especially for the Senate. Mr J. R. Odgers, the Clerk of the Senate, is a notable authority on this subject and in his work ‘Australian Senate Practice’ at pages 478 and 479 he refers to the power of the Senate to summons witnesses. I shall quote from Mr Odgers because I am sure honourable senators will not mind my taking time to do so because this is an important issue. I refer to a historic occasion. It is one we should take seriously in mind. In this work, Mr Odgers writes:
By section 49 of the Constitution it is enacted that the powers, privileges, and immunities of the Senate and the House of Representatives, and of the members and the committees of each House, shall be such as are declared by the Parliament, and until declared shall be those of the Commons House of Parliament of the United Kingdom, and of its members and committees, at the establishment of the Commonwealth. No comprehensive declaratory Act has been passed, nor has the Parliament legislated relating to Parliamentary witnesses generally. Under section 49 of the Constitution one of the undoubted powers of the Senate (and of the House of Representatives) is the power to summon witnesses to appear before it to give evidence and produce documents.
In accordance with such power, the Senate, in 193 1, called to the Bar of the Sente the Chairman of the Board of the Commonwealth Bank, Sir Robert Gibson, to give evidence in relation to the Commonwealth Bank Bill. The summons to the witness took the following form:
I need not quote the form. Mr Odgers again referred to this on page 503. He quotes standing order 39 1 which states:
When a Witness is examined by the Senate or a Committee of the Whole, the Bar is kept down.
In this respect Mr Odgers stated:
When Sir Robert Gibson was called to the Bar of the Senate in 1 93 1 for the purpose of giving evidence in relation to the Commonwealth Bank Bill, he was sworn at the Bar, by the Clerk of the Senate, and then, with the concurrence of Senators, admitted within the Bar to a place at the end of the Table.
That place is at present vacant. In addition, the Journals of the Senate of 1 May 193 1 show that a motion was moved that Sir Robert Gibson be called and the Journals of the Senate of 6 May 1 93 1 show that Sir Robert Gibson was present.
I want to refer to one or two items which appeared in the parliamentary Hansard report of this event because they are interesting. At the time the President of the Senate was Senator the Hon. W. Kingsmill. In reply to remarks made by the then President Senator Barnes stated:
All I wish to say at this stage is that the great anxiety of honourable senators to secure the utmost information possible to guide them wisely in dealing with the difficulties with which Australia is confronted has caused the Senate to decide to summon so eminent a citizen as Sir Robert Gibson to give evidence concerning matters relating to the Commonwealth Bank Bill -
Senator Sir George Pearce who began the questioning is regarded by many as one of the greatest senators in Australian Senate history. A notable book which was written by the late Sir Peter Hayden on Sir George Pearce called ‘Quiet Decision’ illustrates the sort of man he was and the sort of attitude he brought to the Senate and his country’s affairs. Sir George Pearce was one of the responsible people who put questions to Sir Robert Gibson. Sir George Pearce asked:
Is the board in a position which gives it a special knowledge of all matters affecting the credit of the Governments of Australia here and overseas?
Sir Robert Gibson replied:
I say definitely that the Bank Board is in a better position than any body or person in Australia to have special knowledge in respect of matters affecting the credit of the Governments of Australia.
I would now like to refer to what Sir Robert Gibson has to say in response to a question which appears on page 1618 of Hansard because I believe that what he said is important. By the way, the examination of Sir Robert Gibson was a rather long one. Sir Robert Gibson said:
I find myself in a somewhat difficult situation. The Bank Board, and myself as its chairman, might be involved in a position in which I definitely say we should not be put. I should like to say to this honourable assembly, if I may be permitted to do so, that the Bank Board has endeavoured to discharge its obligations without fear or favour of any government, and without regard to any political party. I would, therefore, ask honourable senators, no matter to what party they may belong, if they will be good enoughbecause I am in a difficult position- to refrain from asking me anything that would in any way suggest that either I or my board have failed in our duty either to the country or to the Parliaments of Australia.
Honourable senators will note that he said without fear or favour of governments past or present or any political party. The Chairman of the Board in those years regarded it as his duty to give information quite impartially.
I wish to quote to the Senate an extract from page 1631 of the Hansard of the same date. I think honourable senators will find this whole matter as interesting as I do. I could quote a good deal more of what was said on this occasion but I must defer to time and other things. At the conclusion of the examination of Sir Robert Gibson President Kingsmill said:
I desire to tender to you, Sir Robert, the sincere thanks of honourable senators for your attendance here and for the evidence that you have given. I also sympathise with you because of the very close and somewhat lengthy examination to which you have been subjected, and which you have most admirably sustained. You have, I think, widened the views of honourable senators on both sides of the Senate in relation to questions connected with this bill, through this bill with finance generally.
As I observed, the position has changed. The Governor of the Reserve Bank, which is now the central bank, is today the responsible person and the Chairman of the Commonwealth Banking Corporation, which operates as a government owned arm in a situation which one might like to call a dualopoly is but one of a series of trading bank chairmen.
I hold the view that if Australia’s economic situation continues to worsen, its monetary position becomes endangered and its currency looks like being in great trouble, then in that event, and only in that event, the Senate will have to consider very seriously whether as a Senate it should seek once again to have before the Senate an authority such as the Governor of the Reserve Bank to discuss with honourable senators the problems that our country is in and the solutions that such a person may believe he has.
– The circumstances are different.
-Of course they are. That is why I am saying we must consider carefully.
– One was where there was a conflict between 2 bodies.
– This is a very important matter to me because I am not the only person who believes that the country is passing into a situation of some considerable difficulty. I believe that if that happens I have the right to seek information from an impartial source that ought to understand what ought to be done. That may not be the honourable senator’s view at the time, but at the time it may be my view.
Some comments on the international monetary scene were made by Sir John Dunlop in the annual report of the Colonial Sugar Refining Co. Ltd. I shall quote part of that report.
The ACTING DEPUTY PRESIDENT (Senator Devitt)- Order! The honourable senator’s time has expired.
– The purpose of the Financial Corporations Bill is to provide the basis for the examination, and as necessary, regulation of activities in the non-bank finance sector. The Bill has been introduced to assist the Australian Government to achieve effective management of the economy. This is the main purpose of the Bill, and this is why the Government is seeking the support of the Senate. There is no need for me to argue here the importance of money and credit in the modern economic system. But I think that I should deal with this aspect briefly because we need to trace the history that led to the necessity for this measure to be introduced. History has shown that no single factor can do more to influence the welfare and progress of a community than the management of the volume and flow of money. Senators on this side of the chamber, as well as senators on the other side, know as well as I do that history is full of incidents.
Brief mention was made of the crisis period of 1931 in which there was conflict between the Chairman of the Commonwealth Bank Board and the Government of the day. History is full of incidents where mismanagement of money has contributed to economic disasters. The mismanagement of money can create booms and slumps, mass unemployment, waste of resources, industrial unrest and social misery. These facts are recognised by all responsible governments. They have been recognised and accepted as the main purposes that a monetary and banking system should serve in a modern economy. A royal commission into the monetary and banking systems of Australia in 1937 expressed these purposes in the strongest terms. As a result the Commonwealth Bank was strengthened and given greater powers. 1 think I can recall that in 1945 additional banking legislation was introduced into the national Parliament which subsequently gave the Parliament some control over the private banks. All of these measures were introduced because some legislative control was required over the banking system, whether it was the Commonwealth Bank or the private banks. The action taken in 1945 was a flow on from what had happened in 1931 when the Chairman of the then Commonwealth Bank, Sir Robert Gibson, was in conflict with the late J. H. Scullin who was the Prime Minister of the day. I do not think that anyone can deny that under this system the banking institutions have made remarkable headway. They have flourished. At the same time it must be to their credit that they have co-operated with the Government in terms of monetary policy.
Honourable senators on both sides of the chamber know that there has been a transformation of the Australian financial scene, particularly in the last quarter of a century. In the 1940s bank assets stood at about 67 per cent of the total national assets, but between 1953 and 1962 the assets of the banks declined to 58 per cent of the total national assets. We are told that today bank assets are as low as 42 per cent of the total national assets. The lesson to be learnt from that is quite clear: By legislation the Government could make arrangements with the banking system, when it controlled 67 per cent of the total national assets, to apply restraints; but the movement from 67 per cent in 1940 down to as low as 42 per cent in 1974 reflects the fact that other causes are operating in Australia today.
There has been a proliferation of financial institutions. I can recall that in the 1940’s the Chifley Government asked the banks to show some restraint in their lending to the hire purchase companies. This meant that the hire purchase companies, which were involved in the business of lending for consumer goods, felt that their source of money was cut off. They examined their position. The legal advice given to them was that they could go on to the open market and make a call for money. That is what they did. They offered interest rates far in excess of those the banks were able to give on account of the restrictions on them. This was the start of the mushrooming of the finance houses. It occurred because the then Government, acting wisely and prudently at the time, put those restraints on the Commonwealth Bank and the Commonwealth Bank co-operated. It refused to make money available to the finance houses, and they went on to the open market. They were so successful that they mushroomed. They have become so successful that today the banks are the biggest shareholders in all the finance companies.
I never cease to marvel that, whilst in most countries today a citizen who can prove that he is in a steady position and is of good character can walk into a bank and receive a personal loan, here in Australia if a person goes into a bank he is told that the bank cannot give him the money but that if he goes around the corner to Custom Credit Corporation Ltd or one of the other finance houses in which the banks are the major shareholders he can get the money, at a greatly increased interest rate. The proliferation has not been only in the number of finance houses. Let us examine what has happened in the last 2 or 3 decades. In Australia today there are operating 1,000 finance company groups, 400 insurance companies, 200 permanent building societies, 750 credit unions and somewhere between 50 and 80 corporations in the merchant banking area. Not only has there been this rapid increase in non-bank financial institution but also there is now a need for considerable expertise to understand the complexities of their operations and to assess the implications of their activities from the national view point.
I do not think anyone can deny that it is a new ball game compared with what it was in the middle of the 1 940s. Of course, it is natural that, with the nation’s economic and social development, there should be a parallel development of the financial machinery. We all know that as incomes and wealth grow those who own them demand a greater variety of assets. This, coupled with the ability to acquire consumer goods on credit, ensures a range of borrowers who are ready to satisfy the demand for financial assets. In a period of economic growth there are people looking to increase their portfolios. On the other hand there is also a ready pool of consumers wanting goods on credit. The bringing of borrowers and lenders together for these transactions which are so necessary in the community has provided the opportunity for new and specialised intermediaries. This growth in the number of intermediaries has been a very characteristic event on the Australian scene over the past 2 or 3 decades.
It must be admitted that the development of the non-bank financial institutions has brought some benefit to the development and economic life of this country. I do not think anyone denies that. No argument with that is contained in the Financial Corporations Bill. However, as I have said, the great growth in the number of intermediaries has raised other significant implications for the economy and responsibilities for the Government. Because of the Government’s willingness to shoulder these responsibilities, it has taken action in regard to the non-bank financial institutions. The major legislative action that has been taken by the Government in regard to these institutions has been the introduction of the Financial Corporations Bill that we are debating today. Honourable senators will recall that it was first introduced into the Parliament last December. Now it is before us for the second time. To put it simply and in a nutshell, the Bill will provide for the Government to have direct control and powers over the activities of the nonbank financial institutions- an essential requirement for any government charged with the responsibility of economic management. That seems to me to be the purpose of the Bill. Just as in the 1940s banking legislation was necessary to control the Commonwealth Bank and the private banks, so 30 years later legislation is necessary for the Government to have some control over the non-bank financial institutions because of the volume of money over which they have control.
I will not weary the Senate by going into the rationale for the introduction of the Financial Corporations Bill in detail. I do not think that I am fully competent to do so. It was dealt with adequately by the Treasurer, Mr Crean, in an address he gave to the New South Wales Branch of the Economic Society of Australia and New Zealand on 6 February 1974 entitled ‘The Government’s policy towards non-bank financial institutions’. In a thorough and wellexplained manner, he outlined to that gathering the rationale behind the Financial Corporations Bill. Honourable senators in this chamber will, I feel, accept that much on the growth of the nonbank financial institutions has been documented in studies and works in the 1950s and the 1960s which presents us with ample information. I was pleased to hear Senator Cotton quote at length from some of these works. I know that it is an area in which he is vitally interested, and I know that he will agree with me when I claim that much of the reason and the rationale, if any are required in this debate, can readily be found in the studies and works of the 1950s and 1960s and which, as I said, were outlined by the Treasurer in his address to the New South Wales Branch of the Economic Society of Australia and New Zealand and which I believe are contained also in the Minister’s second reading speech.
It might be pertinent now to examine some of the features of the Bill. The Bill seeks to empower the Government to apply specific controls regarding asset ratios, qualitative and quantitative lending policies and interest rates rather than specify the controls that will be imposed and the method by which they will be imposed. This policy or attitude is adopted because of the diversity of types of institutions and the diversity of individual institutions within a group. The Government believes- and I believe that this has been accepted by the Opposition- that there must be some flexibility in the processes. The second point I put forward is that if controls are applied they should not be applied so as to undermine confidence in an institution or to disrupt its activities. This will require the institutions to make available detailed information of thenstructure and operations. This will be immensely helpful to any government irrespective of its political persuasion because until now little has been known of the operations, construction and constitution of these institutions. The Minister indicated in his second reading speech that before controls are brought in there will be consultations between his Department and the financial institutions involved. Of course, the Bill also provides the objectives to be reached by voluntary co-operation and consultation. These, I believe, are very important factors. The fact is that by voluntary co-operation and consultation with institutions these objectives may be brought about and the Government can see significant advantages in its objectives being achieved in this way.
During this debate the Government will probably be asked why these measures and controls are necessary since there is already adequate legislation in the States governing the institutions and consumers’ interests. It is true that legislation against fraud, misappropriation and so on affords some general protection to the community in this area. But experience suggests that special legislation also is necessary. In Australia it is the States which have in general legislated for the stability of intermediaries and for the protection of consumers, including provisions regarding minimum liquidity requirements, capital borrowing, gearing ratios and the like. The Government sees this State legislation as a necessary requirement of the overall system of surveillance over financial institutions. But in introducing the Financial Corporations Bill it has indicated that it is not its intention that this Bill should exclude or limit the operation of State laws. I expect that in the normal course of events they will operate concurrently. That is what the Government feels about the State laws.
In conclusion I would like to make brief reference to the effect that the Financial Corporations Bill could have had on foreign ownership and control, if this provision was included in the Bill. As a member of the Senate Standing Committee on Foreign Ownership and Control I have an interest in this area. I believe that the Financial Corporations Bill could have given specific legislative effect to another aspect of Government policy on non-bank financial institutions.
This is in the area of foreign ownership and control. A significant part of the growth of non-bank financial institutions in recent years can be attributed to the entry of foreign institutions. The Government takes the view that Australia is already adequately supplied with non-bank financial institutions and that, generally, there would be little benefit in allowing additional institutions to be established by foreign interests. However, this policy would not be a blanket ban on new foreign owned intermediaries. There could be special circumstances warranting their establishment. Nor would it be intended that established foreign owned institutions would be restricted or dispossessed. Rather they would be expected to co-operate with the authorities and to come under the same control and restraint as Australian owned and controlled intermediaries.
I hope that in the brief time that I have had at my disposal I have thrown some light on the Government’s intentions and have shown that the Government’s attitude to financial institutions is a responsible one. Whilst we as well as senators on the other side realise that intermediaries will have some apprehension about surveillance and controls over their activities which did not exist previously, we nevertheless feel that they will agree with us that the measures are necessary just as similar measures were necessary in the banking system in the 1 940s.
-The purpose of the Financial Corporations Bill is said to be to set the basis for the examination and regulation of activities of the non-bank financial sector of the economy. If this legislation were truly aimed at the regulation and control of corporations in which the provision of, or the trading in, finance was the main business it would have my wholehearted support. It is my view that this Bill finds its support in the Opposition because of the assurances given by the Minister for Agriculture (Senator Wriedt) in his second reading speech and in the explanatory memorandum which accompanied that speech. That expresses positively that the aim of this Government is purely to lay down a basis for the control of non-bank financial institutions. I believe that that is not an accurate description; and I think that when one reads in future years the Hansard report of what the previous speaker, Senator McAuliffe, had to say in his concluding remarks, that he hoped he had thrown some light on the Government’s intentions, one will find that what he said is very wide of the mark.
The basic policy of the Labor Party is socialism. From time to time in this place I have taken the Labor Party to task not over that philosophy but over the outcome of the application of such a policy. It is very evident to me that the expansion of Labor philosophy for the control of private industry is embraced by the Financial Corporations Bill. I hope that it is the aim of the Government, as the Minister has stated, to get general control over non-bank financial institutions. I agree with previous speakers who have said that at the present time general influences and pressures are being exerted from day to day by very large financial institutions and corporations which are not pure banking institutions, and that this is having a great effect on our economy. One certainly can see that the use of credit in our economy is important. One can see the influence for good and indeed the influence for bad that can be brought about by the Government giving directions to the Reserve Bank of Australia so that those directions eventually tie into our banking system. I think that in normal circumstances it would be a wise provision to give the Government the right to disclose statistics perhaps in order to give direction on matters that concern large non-bank financial institutions.
One finds in various fields today that credit houses provide very much of the money that is required beyond that provided by banking institutions. Anyone who is involved in business or in financial matters these days finds himself, in many instances, having to go to the extrafinancial institutions. Various bodies grant credit on terms which at times are much better than the terms provided by the various private banking ^stitutions which are under the direct instruction of the Government. I think that these extrafinancial institutions should be controlled. I believe that the Minister’s statement that there should be regulations covering the activities of that financial sector of the community is in the interests of our economy.
The point I make is that the Bill goes much further and, while I have been present in the chamber, this point has not been raised by any previous speaker. I see a great shadow looming over our economy, cast mainly by a Government which wishes to have this monolithic social control over private industry, by classing, in the first instance, large retailers in our community as financial institutions. I noted that the previous speaker, Senator McAuliffe, did not mention that fact, although he attempted to indicate what the Government proposes by this legislation. Clause 4 of the Bill, which contains the definitions, reads:
A reference in this Act to the provision of finance includes a reference to-
Clause 8 ( 1 ) of the Bill states:
Subject to sub-section (2), this Act applies to a corporation if . . .
the corporation engages in the provision of finance in the course of carrying on in Australia a business (whether or not that business is its sole or principal business) of selling goods by retail and the sum of the values of such of the assets of the corporation and of any corporation that is related to the corporation as consist of debts due to the corporation concerned, being debts resulting from transactions entered into in the course of the provision of finance by that corporation, exceeds-
if a greater or lesser amount is prescribed by the regulations- the amount so prescribed.
It is my view that if in 2 years this Senate comes back under the control of the present Government, there will be a prescription by regulation which will not be capable of challenge probably in either House of the Parliament, and we will find that the prescribed amount could be lowered to such an extent that most major trading organisations in Australia would be covered by this legislation.
I think that that would be wrong in the community. I refer, for instance, to a great trading organisation such as the Myer Emporium- and let us hope that the contributions that may have been made to the Australian Labor Party by a director of that corporation will not influence the Government to exclude that corporation from the provisions of this legislation. I noted that some retail corporations were excluded, by definition, from the provisions of the Prices Justification Tribunal Act, but the reasons for prescribing the regulations in that instance are best known to the Government. At the present time the Government is complaining that it has not thrown its net sufficiently wide in regard to the Prices Justification Tribunal. Where a great trading organisation such as the Myer Emporium happened to have, as it undoubtedly would have, $5m worth of sundry debtors on its books-those sundry debtors, in all probability, would have run up more than 90 days extension of credit at the present time- I can see that organisation being covered by this legislation, unless it is specifically excluded.
As I understand the definitions included in this legislation, I beleive that 5 other great trading organisations in Australia would come within the provisions of this legislation, because over the years in their trading operations these organisations have made provision so that their customers could purchase goods and gain credit. On the other hand, a wonderful organisation such as G. J. Coles and Co. Ltd has been trading on a cash basis with, I understand, a turnover of some $864m this year. What a wonderful organisation that must be. Whilst the turnover, the amount of cash handled and the importance to the community of those 2 organisations must be similar, we find that one could be included within, and one could be excluded from, the provisions of this legislation. There could be arguments as to whether this is the intention of the Bill. The first speaker for the Government on this matter after the Minister outlined what was the Government’s intention, but he completely omitted any reference to this area. But the Bill provides for it It provides the Government, if it happens to have control of this matter, which is not unlikely in the ensuing years, with the power to prescribe a greater or lesser amount of sundry debtors and so include a certain company within the provisions of this legislation. Why would the Government want this control? I have had an account with Myers for years, and that organisation has not charged me one per cent of interest on any money that I have owed it for more than 30 days. Here is a company offering credit to the public and not charging interest on it.
– It is providing a community service.
– It is providing a community service. It is the wish of other types of corporations not to provide such a service, and I think that is a decision for those corporations to take. But I criticise the administration of this Government for making it possible to include some of the larger corporations within the provisions of this legislation. I see in the provisions contained in this Bill, a great threat, a great shadow cast by socialism on the general trading community. I do not know who drafted this Bill or whether my reading of it is not correct; perhaps the Minister could ask his officials to advise him on this point. I quote from clause 8 (2) (k), which has the side note ‘Corporation to which Act applies’. It is on page 4 of the Bill. Although the clause contains some provisos, subclause (k) states: the sum of the values of all the assets of the corporation and of every corporation that is related to the corporation does not exceed-
I make the point that in a number of instances the expression ‘the sum of the values of all the assets’ appears. I note it in another clause of the Bill. It appears on page 7 and page 8, 1 believe, of the Bill. On page 4, for instance, the wording is the value of the assets concerned’. That definition is not related to gross assets and it is not related to net assets. The word used is ‘assets’. My understanding of that word, from an accounting point of view, is that if a company borrowed or at any time had $ lm on the assets side of its balance sheet and if it had a debt of $ 1 m on the liabilities side it would have assets of $lm. A company may have $lm capital but may have borrowed to the extent that its assets are offset, so that the balance sheet, in the end, reflects only a very minimal capital. Because it has assets as shown in the balance sheet at a particular date, it will come within the terms of this legislation in some way.
I make one or two points relating to statistics which the Australian Bureau of Statistics has issued on this matter. It is quite difficult to understand the full ambit of the net which the Government is throwing. The Australian Bureau of Statistics conducts regular surveys of the operations of finance companies in Australia. For the purposes of those statistics and subject to certain qualifications, a finance company is defined as an incorporated company which is mainly engaged in providing the general public, businesses as well as persons in their private capacity, with credit facilities comprising instalment credit for retail sales, personal loans, wholesale finance, other consumer and commercial loans, and factoring. A company is regarded as being mainly engaged in providing these facilities if 50 per cent or more of its assets consist of balances outstanding with respect to these types of financing or if 50 per cent or more of its income is derived from such types of financing. Perhaps the Minister can point out where I may be wrong, but what a pity the Government did not take that definition as the criterion for its definition of finan- cia corporations- if 50 per cent or more of the 1 assets consist of balances outstanding in relation to finance or if 50 per cent or more of its income is derived from such types of financing. On that definition, many of the companies of which I spoke would be excluded.
According to the figures which the Bureau has, there are considered to be 134 finance companies with assets in excess of $lm, 27 with assets between $500,000 and Sim, and 615 with assets less than $500,000. The point which I make now is that as at 30 April 1974 the balance outstanding to the 161 finance companies included in the Bureau’s definition totalled $7,5 12.9m. The figures show that as at 30 May 6 retailers had balances outstanding in excess of $5m, and the total of the balances outstanding to those 6 companies was $73.9m. I make the point that large companies with great trading reputations are or may be embraced by the provisions of this BDI.
What could it mean? Why is the Government seeking control over a retail organisation which grants $5m credit? Surely it can be only to say to that company: ‘In line with our general thinking, you had better charge interest on overdue accounts. That would be an impost on the people which we would like to see’. Now that this Government has set the general overdraft trading terms at 14 per cent for the first $50,000 and 1 5 per cent thereafter- this is current- it makes it mandatory for retail organisations which grant credit to say to their customers, as they have never said previously, ‘If you are overdue you will pay us 1 Vi per cent per month on your borrowed money’. About 50 letters on the situation have reached my desk. My own organisation has received letters suggesting that we pay more promptly. If it were the case that we did not pay promptly- it is not the case- we would have to pay that impost. Customers are receiving notification that it is necessary for them now to pay interest on money which has been loaned by way of credit.
This Government, by direct decision and by direct control over the banking institutions in this country, has forced an entirely unacceptable credit situation on those organisations which previously granted credit freely. What can be the aim of a government which is doing this? Two years ago the general situation was one of a strong economic climate. Business was able to look at investment and to go to banks or to semibanking institutions to borrow money at 6 per cent or 7 per cent and secure some reasonable return on investment. Over the years it was possible, through expansion to provide jobs for the young people and produce development such as had never been seen previously in our community. In 1 8 months this Government has changed the situation, no matter what actions it has taken. Senator McAuliffe said today: ‘History is full of instances of mismanagement which have brought disaster to the community’. I cannot imagine any honourable senator opposite making a more damaging statement about what his
Party has done in 1 8 months. I can imagine the burden on the honourable senator’s mind which prompted him to make that philosophical statement. I think it will be one of the speeches which will go on record so far as he is concerned. I do not know whether the Labor Party realises it, but business is being cut back minute by minute. Jobs are being eliminated.
-We are responsible people, the same as you are.
– I am glad that the honourable senator takes the responsibility because many of the Ministers, each with different ideas as to how this community should be organised, are certainly not taking the responsibility. The honourable senator interrupted and said that he supports the statement put down by the Treasurer, Mr Crean, a few days ago, the statement headed ‘The Inflationary Situation’.
– No, the one he gave -
-The honourable senator says ‘no’. I am pleased. In those circumstances, as the honourable senator says no, I will not quote it. I take it that he does not support it.
– I rise to take a point of order, Mr Acting Deputy President. I never said -
The ACTING DEPUTY PRESIDENT (Senator Devitt)- Order! Does the honourable senator claim to have been misrepresented?
– I have been misrepresented. The document I quoted from -
The ACTING DEPUTY PRESIDENTOrder! The honourable senator can make a personal explanation at the conclusion to Senator Webster’s remarks.
– I certainly apologise to Senator McAuliffe if what I said does not represent his views. I noted his remark today and it could be applied to various areas of his thinking. I was demonstrating a critical situation and the fact that his senior Treasury man, the parliamentary head of the Treasury, had made an inflationary statement which only added to the fire by presenting an extra burden of expense to the community. We will see a new generation of rises in every area. I noted an article in a Victorian newspaper published the day after Mr Crean made his statement. The article was headed: ‘Prices will be pushed up even faster’. It was written by Peter Cairns. I do not know whether he is a relative of the Deputy Prime Minister (Dr J. F. Cairns) but I do not think so. He said:
The sharp rate of increase in the June quarter consumer price index was the spark that ignited last night’s economic explosion in Canberra. Yet the Government’ s latest moves will ensure that consumer prices rise faster than ever in the months ahead.
– He is not a relative of Dr Cairns.
-No, I think that Dr Cairns employs his relatives and that is more of a disaster for the community. We should consider that a very despicable course to follow but perhaps Senator Cavanagh may speak on that matter and justify it one day. I, as an Opposition member, fully agree with the right of the Government to say that the extra financial institutions in the community should come within the responsibility of the general banking area. I refer to institutions which lend credit, those which have at least50 per cent of their assets tied up in borrowing and earn perhaps at least 50 per cent of their income from the borrowing of money. But to spread that net wider, as this Bill does, enshrines the ability of government to delve so much further into the retail sectors of the community. The Minister for Agriculture (Senator Wriedt) who in this place represents the Treasurer indicated in his speech the other areas which can be covered. He said:
Other corporations whose borrowing and lending activities are important- that is, corporate retailers which, within their own operations, have outstanding finance provided totalling $5m or more- will also be covered.
The Minister stopped short and said that there is a provision ‘or such other amount as the Minister may wish to declare’. That can be done in very quick time so that the whole of the business community is brought under the economic control of this Government.
The efforts of this class of government in a period of 1 8 months surely must stand as a statue commemorating what a socialist government can do to the community. In 18 short months we have seen economic controls in many areas attempted by this Government. When I was speaking about what Senator McAuliffe said I was only raising a point about interest rates. How could one ever have envisaged an interest rate of 20 per cent in this community. I could never have done so, nor could Senator Cotton, for all his business experience. We have seen that interest rate of 20 per cent endorsed. We all have on our desks a prospectus from one of the large resources banking institutions offering 10¾ per cent for investments. What must be its lending rate? If anybody believes that interest rates in this community will drop more than 1 per cent or 2 per cent they have a grave fright coming. It cannot happen. I fear for the whole economic basis of this community. Lenin once said: ‘If you wish to control the capitalist society, debauch their economy’. That is what is happening in Australia. The percentage of the community which voted for the Australian Labor Party in the last election will rue the day that they did so. The poor individuals in the community who sought finance for housing do not have even enough money for a deposit, or the ability to repay out of their wages today. The enormously high interest rate that we have was introduced by this Government having the ability to control the banking institutions of this community.
– You are talking through the back of your neck. You do it every Wednesday.
- Senator Cavanagh says that I am talking through the back of my neck. If there was a pie stand outside Parliament House there is not one Minister or member of the Labor Party whom I would put in charge of it for 24 hours. Their fingers would be in the till. The money would all go and the pies would all go. That is what is happening in this community. It is regrettable that this should be happening in this wonderful community. Indeed, that situation is intensifying. The most recent statement by the Treasurer suggesting that the Government is taking action against the inflationary situation is a complete negation of any control aimed at assisting the people of Australia under the present situation.
The ACTING DEPUTY PRESIDENT (Senator Devitt)- Order! The honourable senator’s time has expired.
Senator McAULIFFE (Queensland)-Mr Acting Deputy President, I wish to make a personal explanation.
The ACTING DEPUTY PRESIDENT- Does the honourable senator claim to have been misrepresented?
– Yes. During Senator Webster’s address he said that I invited the attention of the Senate to a document issued by the Treasurer, Mr Crean, which the honourable senator said was the statement on inflation which Mr Crean had made in the other place some days ago. That is not quite right. If the honourable senator had been listening when I was speaking he would have heard me say that I would not give the tedious detail of the rationale behind the introduction of this Financial Corporations Bill but I suggested to honourable senators that they should read the speech delivered by the Treasurer in Sydney on 6 February 1974, an address entitled ‘The Role of the Government towards Non-Bank Financial Institutions’. That was an address delivered to the New South Wales Branch of the Economic Society of Australia. I know that this is a bit too high for Senator Webster to follow but I would like him to correct his claim that I had referred the Senate to the Treasurer’s statement on inflation. May I be permitted to say also that by correcting that remark I am not implying that I do not agree with the statement on inflation put down by the Treasurer. I wholeheartedly support the Treasurer in that statement and in his intentions. However I wanted to correct the record where Senator Webster made the error of misquoting what I suggested to the Senate.
The ACTING DEPUTY PRESIDENT- I might be able to help the situation by indicating to you, Senator McAuliffe, that during the latter stage of Senator Webster’s remarks he apologised for any incorrect interpretation of some observation that you made. Does that clear the situation?
– I listened to Senator McAuliffe and I apologise to him if I embarrassed him in any way. The Senate record will show that at no stage did I say that Senator McAuliffe quoted from Mr Crean ‘s statement.
-You said I had referred the Senate to it. Apparently Senator Webster is not satisfied with my explanation. He now wants to refer to what is contained in Hansard. If he wants to continue this debate on this point I am prepared to engage him, and he will find that he has more than he can handle. He has a habit of handling the truth carelessly in this chamber, having statements recorded in Hansard and heard over the air and then sitting down and not giving others an opportunity to reply. He does it every Wednesday when we are on the air. It is about time he was stopped from engaging in this behaviour.
– With the background of the remarks of Senator Cotton, I indicate support for the Bill but also express personal reservations about many aspects of it. It has been introduced by the Government at a time when other countries with substantial experience of the costs associated with direct controls over the non-banking sector have been dismantling their systems. The reason given for the introduciton of this Bill is the need to control inflation. I question the power of the Bill to enable the Government to control inflation. I also question whether the Government needs the powers contained in this Bill to control the inflation which we are experiencing. The powers which are in the Bill certainly would be counter-productive in terms of the normal social and economic objectives of Australian governments and in some circumstances could be disastrous.
The pattern that we have seen emerge in the introduction of this legislation is the Government suggesting that it requires powers but giving assurances that they will not necessarily be used. I question that approach to a Bill with the serious implications which any Bill affecting the money market in Australia at present must have. The assurance that powers are required but will not necessarily be used is one that I accept only with reservations. The fact that the Government has asked for these powers and wishes to use controls in an attempt to achieve the objectives of tight credit and low interest rates in a highly inflationary situation could result in investors rapidly moving their funds out of those financial intermediaries which are subject to direct controls into other financial assets, and this could be very disastrous in the present situation.
This Bill affects institutions with assets of more than Sim. The fact that there are other institutions which would not be affected by the Bill could lead to a situation in which there would be a withdrawal of support from the institutions within the ambit of the legislation and a dislocation of the money market as we have learned to experience it. The stability of financial institutions could be endangered. Funds could be cut sharply and advances could be rationed to the best credit risks. This would not necessarily give Australian business the best opportunity to acquire funds for its development and for its continuity. These are situations which I question in considering this Bill. While we are hearing that powers may not necessarily be used, Ministers have varying ideas on what interest rates should apply at the present time and from time to time Ministers make irresponsible statements which cause a rapid deterioration in the money market. These are the problems which face us in the present economic climate, and I question some of the powers provided in this Bill.
To provide the Government with control over the financial system at this time would permit it not only to restructure financial markets but also to use that control as a powerful instrument to effect social objectives; that is, to change the structure of the existing market and the existing economy. The Bill contains powers that give control over the volume and direction of lending and over asset ratios and also powers with which to control interest rates. These powers, taken as a conglomerate, give the Government absolute control over the existing system in our economy, and I question the outcome of the use of some of these powers. The fact that there are direct controls over the banking system shows that there is a unique position amongst financial institutions in Australia because they have a traditional association with the money supply. The controls over banks are not necessarily appropriate to those institutions which are outside the Australian banking sector and it is over-simplifying the situation to suggest that all financial institutions need to be under the same system of control.
In talking about social objectives, I was interested to hear Senator McAuliffe give, as one of the reasons for requiring this control, the need for our financial policy to be related to foreign investment in Australia. I had anticipated his remarks incorrectly. I had thought that he might draw attention to the fact that the powers for controlling the direction of lending could be directed towards an institution such as the Australian Industry Development Corporation and its objectives with regard to Australian ownership of some of our resources. He did not use that as the parallel in his remarks. He was talking more about the foreign owned financial institutions and the effect that this Bill would have on them. But I use my own examples of the effect of the power given under this Bill on the volume and direction of lending to draw attention to the fact that the achievement of the objectives of the AIDC could be one purpose for which that power could be used.
– If you give us the Bill.
– That is something that the honourable senator and I might do together. The lending policy aspect of the Bill is contained within clause 14. It gives power over the volume and direction of lending. Some of the clauses of the Bill we will deal with in more detail in Committee, but I draw attention to that clause in particular. I also draw attention to the clause which relates to asset ratios, because by linking clauses 13 and 14 we see the effect which the Government could achieve by using the powers contained in this legislation. It is fair to assume that, if there is control over the asset ratio of a lending institution and there is control over the volume and direction of lending which is permitted, there is fairly rigid control of that institution.
It is to the next clause, clause 1 5, that I have my strongest personal objections. I must acknowledge that I have not the support of my Party in stating my objections to this Bill, but I believe that clause 15, which grants the power to set interest rates, is the most dangerous clause in the Bill in terms of the dislocation of the financial market in Australia. The fact that there are direct controls on interest rates, as well as the other 2 powers I have mentioned, means that we have not a satisfactory method of dealing with inflation but a control which results in the institutions themselves having no means of making commercial decisions with regard to their business undertakings. They are faced with the possibility of the use of a power which may remove from the management of companies the ability to control the flow of funds which they handle and also their ability to enter into long term commitments. Their freedom to set interest rates is really the means by which these financial institutions conduct their business and survive or fail. To have that decision making ability taken from them as a commercial risk and undertaking and placed into the hands of a government is something that I believe limits considerably the operations of this non-banking sector in the Australian market. It is interesting to see this Bill being introduced at this time when we consider that comparable countries which have had this sort of power and these controls are now seeking to dismantle them. It is a salutary experience to compare what happened in New Zealand with the sort of situation which I have outlined. Perhaps we could talk a little more about that if we had more time in Committee.
Sitting suspended from 6 to 8 p.m.
– (Quorum formed)
Before the suspension of the sitting of the Senate I was relating my remarks to clause 15 of the Financial Corporations Bill which contains the power to control interest rates. I stated that I felt this was perhaps the most dangerous of the 3 direct controls which may be introduced by regulations under the Bill. It is important to understand that the inflationary effects of financial institutions come principally from their volume of lending rather than from the interest rates which they charge. The interest rates tend to reflect the underlying levels of inflation. In this present situation I think it is a dangerous power that is proposed. Although the Government has suggested that it would not necessarily use the power, we have the feeling from the recent statements of the Treasurer (Mr Crean) and the Minister for Housing and Construction (Mr Les Johnson) that the provisions of clause 15 are highly likely to be implemented
I draw attention, as I mentioned earlier, to the New Zealand experience. The Reserve Bank in that country pegged the borrowing rates at uncompetitive levels and that demonstrated that financial institutions cannot maintain lending operations under such controls. We should recall that it was only by the granting of emergency rights to overseas and local credit lines and by lifting interest rate controls over most of the borrowing for periods of over 5 years that the New Zealand Government avoided a crisis situation. It is this aspect which concerns me about the use of clause 1 5 in the context as we see it. The Australian financial companies depend on the fixed interest market for 85 per cent of new money that is raised. Such companies that are within the Australian Finance Conference have more than $4,400m in public borrowings which are needed to maintain consumer and commercial credit operations. It is this aspect of the current legislation also which concerns me, namely, the effect that it would have on the availability of finance for consumer and credit operations.
There is currently $8,000m in outstanding balances on consumer credit. The effect of any control which is exercised directly or indirectly must be to jeopardise the availability of such funds. In the present situation of other tensions in the economy which will affect the employment situation it is appropriate to remember that the sorts of companies which use consumer credit finance employ more than 1,500,000 people. Approximately 32 per cent of all purchases of new motor vehicles are covered by this type of finance and more than 65 per cent of all second-hand motor vehicle purchases are covered through consumer credit operations. It is the dangerous application of the control of interest rates in this area about which I have been speaking. It is true to say that control of interest rates might serve a political interest. Such action may appear to be direct government action to achieve a particular purpose. But if we are talking about political interest only, I think that we should also consider what is the national interest and how such action would affect the consumer credit operations of many of our Australian companies and indirectly the Australian work force itself.
I have this strong feeling of concern about the operation of the interest rate power within this Bill. I have related most of my remarks to this matter because it is not a part of the Bill which we will seek to amend in the Committee stage. It seems to me that at this time in the history of this Australian Government the concrete pipes case appears to give the Government a power under the Constitution to implement direct controls over the non-bank financial organisations and that that is a power which the Government seeks to use. Whether that power is to be used for political purposes or in the national interest remains to be seen. But it is a power which is sought in this Bill and one which I feel could have far reaching implications into the future.
My remarks in approaching the Bill have been somewhat limited, but I wanted to place on record the danger, as I see it, of the application of the control on interest rates when taken into account with the control over the volume and direction of lending and the control over the asset ratio of the various companies which are within our lending institutions. I shall be following through the amendments to be moved by the Opposition at the Committee stage of the Bill, but I wish to make these remarks in a somewhat personal way about the application of the interest rates power.
– It has been refreshing to listen to the calm and reasoned contributions which have come particularly from Senator Cotton and Senator Guilfoyle. They were contributions of a quality that we are accustomed to hearing from these 2 senators. I regret that I am not able to pay the same tribute to the contribution made by Senator Webster. But I state that the general tone of the debate, as set by the other 2 Opposition senators, has been of a very high level. I must admit that listening to what they have had to say has done much to clarify in my mind what this highly important Bill is about. I can also understand the reservations of the honourable senators who have spoken. After all, this Bill represents an entry into a new field by the Australian Government. I can imagine that back in the 1930s the sort of regulation of the banking system which is now accepted without reservation on all sides and by all sections of the community must have had an almost Bolshevist tone to anybody on the conservative side of politics. But I think that there is a relative consensus now amongst thinking people about the necessity for controls on the banking system proper which we have had now for many years.
This Bill aims to extend this type of regulation into the activities of the non-bank sector in the interests of effective management of the economy.
I suppose that if a government had wanted to go in for this sort of regulation it might have been possible in the past to rely.on the banking power in the Constitution; because I do not think that it could be denied that many of the institutions which we now seek to cover by this Bill are properly classifiable as banks. However, as has been pointed out by Senator Guilfoyle, since the Rocla pipes decision the Australian Government can feel more confident that it can enact a measure like this under the corporations power. It is on this power that this Bill is firmly based. The reason why it is necessary in the submission of this Government- I think that this was largely agreed to by the 2 Opposition senators to whom I have referred- for it to enter this field is the development that has been going on in the Australian economy with regard to the financial structure. As is pointed out in the memorandum which accompanied the Bill, this field has been transformed over recent years by the advent of new financial institutions and by some marked changes in the relative rates of growth of major institutional groups.
As is pointed out in this document there has been, over the years, a steady decline in the importance of the banking system vis-a-vis these other institutions and a rapid growth of nonbank financial institutions such as finance companies, building societies, merchant banks and money market dealers so I submit that once the principle is accepted- it has been accepted for many years- that in the interests of economic management there has to be some governmental control over the banking system there is no case left against the Government also interfering, if that is the word, or at least claiming to play a role in the regulation of these other institutions which loom so large in modern economies. For that reason the Government has seen fit to rely on this corporations power in order to set up a structure which in this Bill merely lays the ground for some regulation and control of these fringe banks. After all, a careful study of the Bill shows that it really does Utile more than lay down a policy. There is Utile fine print. The actual regulation of these institutions can come only after the information which is sought and which it is made possible for the Government to gather by virtue of some of the clauses of this Bill is in. Until we have this information we do not know exactly how to go about regulating these institutions.
As the Bill makes clear, the Government also faces the fact that different types of regulation and control will be appropriate for some institutions as distinct from other institutions. It is not suggested that a merchant bank, a building society or any of the other institutions mentioned in the Bill are all of exactly the same nature and that a blanket type of regulation or control is appropriate for each one of them. The policy of the legislation is for the Government or the Reserve Bank and the Treasury to be empowered to’ require certain information from these institutions. It is then proposed that the Government will proceed with what it considers necessary in the interests of economic management to institute controls over these organisations. I do not think it has been denied by speakers from the other side that especially in a situation such as the one which the economy faces today any central government requires all the weapons on which it can lay its hands in order to be able to cope with these pressing, difficult and complex economic problems which face every advanced industrial society.
I believe it would be churlish of an opposition to taunt a government with its failure to handle inflationary problems and at the same time deny it the weapons which the Australian Government seeks to gather to itself by means of this Bill. To their credit Senators Cotton and Guilfoyle have not suggested that the Government does not in fact need some such powers as it is seeking although, as they are entitled as responsible oppositionists, they have certain reservations about the details of what we are seeking. I think that any fears that they or others on the other side might have about the way this Government will use these weapons should be considerably allayed by the way in which it has conducted itself so far in the formulation of this Bill. The Bill has been brought into being only after the most detailed and elaborate consultations with representatives of the institutions affected. As the Bill shows, it is the intention of the Government to maintain this sort of contact, liaison and consultation with the institutions themselves. I need refer only briefly to clauses 30 and 3 1 of the Bill. Clause 30 states:
The clause proceeds to set out the intention of the Treasurer to have regular consultations with persons affected before framing the regulations which will be necessary to flesh out the skeleton, as this Bill seeks to do. Clause 3 1 states:
The Reserve Bank shall, from time to time as it considers desirable, consult associations or other bodies representing registered corporations with the object of keeping itself informed of their views in relation to the exercise by the Reserve Bank of its powers under this Act and the regulations and in relation to trends in activities of their members.
I think I can truthfully say that the manner in which the Government has approached the novel task of introducing some regulation into the activities of these highly important institutions must give some confidence to our critics that we have not embarked lightly on this task and that we will be conscientious in the future in making sure that we are not just regulating or controlling for regulation and controls sake but, in fact, that we will approach our task conscientiously and responsibly and with no intention of destroying or harming these institutions which we freely admit play a highly important role in the mobilisation of capital for the carrying on of enterprises which go to make up this advanced industrial society in which we live.
Of course, as a final safeguard I point out to honourable senators opposite that the power which resides in this Senate of disallowing regulations remains totally unimpaired. As a member until recently of what I regard as one of the most important institutions of this Parliament, the Senate Regulations and Ordinances Committee, 1 feel sure that that Committee will be vigilant to see that the regulations which are ultimately introduced pursuant to the scheme of this Bill do not offend against any of the principles which have been established largely by the activities of that Committee over the years. I can imagine that such sturdy watchdogs of the rights of the Parliament and of the institutions of this country as Senator Wright will be especially vigilant on that Committee to see that we do not exceed the brief which we are seeking to have conferred on us by this Bill. I suggest to honourable senators opposite that the general tone which has been set by the honourable senators I have mentioned should continue to be maintained in this debate. This is a highly important Bill. Regulation and some measure of control of these institutions are long overdue. I submit that a careful reading of the Bill shows that the Government has adopted a temperate and conscientious approach to its task and that if Parliament continues to be vigilant there is little danger of it exceeding the brief which it seeks in this Bill.
– The Financial Corporations Bill which is before the Senate tonight has a history of being introduced, discussed, amended and reintroduced. Its earlier presentations became the subject of consultations and conferences with the interested parties. It has now been brought into this chamber by the Minister for Agriculture (Senator Wriedt) who represents the Treasurer (Mr Crean) in this chamber. The basic objectives of the Bill are to provide the means of obtaining additional basic information about the institutions which are referred to in the Bill and also to give the Australian Government adequate’ control powers over what we know as the non-bank financial institutions. These control powers, it is suggested, will be in line with those that presently exist in regard to banks and they are designed to assist the Government in the effective overall management of the economy. The
Financial Corporations Bill is therefore designed to cover the major non-bank financial institutions that are engaged in borrowing and lending. Under the proposed legislation corporations will be required to register and provide regular information about their various activities. According to the Treasurer the information would enable the Government to assess the various needs and to regulate the financial institutions which are concerned. This legislation will give the Government a considerable amount of control and power over the major sources of credit other than the banks which are already controlled under the Banking Act.
The Bill provides the framework in which the Reserve Bank can control these non-bank financial intermediaries by the use of regulations. It has been interesting and assuring to note that the Treasurer has advised that he hopes to achieve these various objectives by continued and regular consultation. In view of this I think that the powers that are sought under the Bill must largely be measured in terms of their scope and not by anything that may have been expressed by the Government or be in its mind to meet its present goals. The Minister for Agriculture in his second reading speech said that the measure is designed to provide the basis for the examination and regulation of activities in the non-bank financial sector. There have been some quite substantial changes and transformations in the Australian financial structure in recent times and the one to which this Bill refers is occasioned, as outlined in comments accompanying the Bill, by the growth of the non-bank institutions. There are a considerable number of these in Australia today. They have a wide range of activities and establishments and are set up to serve a considerable group of people. They comprise about 1,000 financial groups, 400 insurance companies, 750 credit unions and, in the area in which I am interested as far as this Bill is concerned, about 200 permanent building societies. As admitted by the Minister these institutions play a contributory role.
Therefore, I suppose, the question arises as to whether this legislation is desirable or whether it is really necessary. There are plenty of references to which one can turn that relate to control over the kind of institutions that are outlined in the Bill. I suppose one of the most notable of the references comes from Sir John Phillips of the Reserve Bank who has pointed out that the use of direct controls usually hinders the process of having the community’s financing done by the most efficient means. The Bank has also expressed the view that direct controls, although they may be very useful tools of policy for a short period, can diminish in effectiveness when applied continuously over a very long period.
There is no doubt that the non-bank financial institutions have played a significant part in Australia’s development. They have not only their economic and commercial role but also what I call a social role. The manner in which they have efficiently mobilised community savings and channelled them into areas where they are needed most has been of the greatest value. I note with appreciation that the Minister in his second reading speech has given expression to this very fact and has gone as far as to acknowledge that the non-bank institutions when operating in a competitive environment certainly increase the efficiency of our financial sector.
The Bill contains a number of points of interest, one of which is that it is described as an enabling Bill, that is, a Bill which will enable lesiglative powers to be conferred upon the Executive. There are many areas of the Bill which incorporate the use of regulations about which more will be said at the Committee stage. I was pleased to hear Senator James McClelland refer to the Senate Standing Committee on Regulations and Ordinances which for many years has made a fairly close scrutiny of regulations. I have no doubt that the Committee in the future will keep a very close watch over the details of the regulations which emerge from this Bill.
Public interest in the Bill is, of course, widespread for the reasons I have mentioned. The establishments representing finance companies, merchant banks and the money market groups have all made representations, and of course, have made known their involvement and their interest in the situation as it is now emerging. The people involved in credit unions and permanent building societies have also taken this action. The permanent building societies, in their conversations with the Treasurer and in their representations in regard to this measure, have recognised that because of their size, nature and involvement they carry a responsibility to the community at large and to the Government of the day. They recognise that the Government has an objective in presenting this legislation, and that this objective has been expressed in the Bill. The societies which operate throughout Australia on principles of mutuality, co-operation and nonprofit have been making loans to home purchasers for over 100 years. Of all the housing loans made in the last financial year by banks and all other institutions combined, the permanent building societies approved 32 per cent which accounted for about 40 per cent of the total value of all loans. The permanent building societies are different from what are sometimes called fringe banking organisations such as hire purchase companies and merchant banks which are also referred to in the Bill.
The permanent building societies are registered and controlled by the States in which they are situated. They are controlled by State government legislation and they come under close supervision from the appropriate State government authorities. They operate on low margins and convert funds made available to them by investors, who in every case are yield conscious, to long term reasonable cost housing finance. Housing societies in recent years have provided what I would call an important new source of housing finance. They have not just existed for the purpose of re-routing finance that would otherwise be available for housing through other sources. Of course it follows that any rate of interest offered by building societies which is not competitive in the market place leads to a situation where there is a downturn in funds available for housing. In this regard, of course, building societies have had a fairly difficult time. Interest rates charged by societies have regrettably increased rather sharply in recent times. This has become necessary in order for the societies to pay a higher rate of interest to investors and so to attract funds to their societies. Rising and changing interest rates have increased the administrative burdens on building societies and greatly increased their problems. They have also influenced the relationship between societies and their borrowers. All of this is due to circumstances over which societies have had no control whatever.
Therefore the permanent building societies are only one link in the chain of very important and influential non-bank institutions which are subject to the requirements of this Bill. The permanent building society industry is one of the highly specialised industries in that it is engaged in a specialised form of financing home ownership. It concerns me that control over these institutions, and over the permanent building societies in particular, is one of the measures within the Bill. I think that we should seek from the Minister as much assurance as he can give in relation to their well being when the measure is implemented, and perhaps to warn that there are a number of factors within the Bill which relate to the exertion of controls, and also that if these controls are not exercised wisely there could be some serious results.
The Financial Corporations Bill gives considerable powers to the central Government through the Reserve Bank. As I understand it, the Bill gives the Reserve Bank power to direct any part of the funds of building societies to any type of assets that it chooses. The Bank can determine the lending policies of a permanent building society. It can determine both the borrowing and lending rates of interest. The Reserve Bank can control the number and value of housing loans granted. It can also exert an influence and control over the period of such loans and may even go so far as to determine the classes of people to whom such loans may be granted. 1 am reminded of references which the Prime Minister (Mr Whitlam) made in a speech about the middle of last year when speaking of what he called such basic financial institutions as building societies. He went on to assert:
We should guarantee their security and in return they should pursue the public interest in their lending policies.
Permanent building societies are very largely community organisations. They have their directors, who have a clear responsibility to see that the societies are properly managed, that there is a continuance of security of savings invested with them and that they can meet the needs of members for home finance. As I said earlier, State governments have the responsibility of making laws which protect investors and borrowers within that State and therefore have a considerable influence on and relationship with the permanent building societies.
The exercise of the powers that are outlined in the Financial Corporations Bill could cut right across the responsibility imposed upon those people who are known as directors and who manage the societies under State law. Indeed, this relationship between Commonwealth and State law could exercise a considerable influence and effect. I have even had it put to me that it might make boards of directors of permanent building societies unable to fulfil their legal responsibilities as directors. So when the Minister is replying I would appreciate some references in relation to- I will not call them doubts- these questions affecting people who are involved in the non-banking institutions and the permanent building society industry in particular.
The Opposition has expressed a view that it is desirable for the government of the day to have powers in this field and to have powers in relation to financial institutions in the country. It may well be argued that if banks are to be subject to significant control then the Government in pursuance of a total economic policy, should have some control over the non-bank sector. But I do not think that we should lose sight of the record of the non-banking institutions generally, and the permanent building societies in particular, which have grown and contributed under the responsible management of various people in the community. An undue control of their activities will have a serious counter productive effect upon them. The regrettable thing about that would be that the counter productive effect would ultimately flow through to the housing situation in this country, with all the undesirable social effects that such a process would have. So the new rules, as I will call them, that are outlined in the Bill will have to be watched very carefully. I hope that the Government will retain the atmosphere of competition and the provision of adequate credit at competitive rates. After all, the non-banking organisations operate now under the general controls of the market place, and this encourages efficiency, lt would be regrettable if this legislation impaired that efficiency. The amendments to which we will be giving our attention later will certainly reduce the risk. I join my colleagues in giving support to the measure.
– This measure- the Financial Corporations Bill- which the Senate is now debating is one of very great significance and one which confers profound powers upon the Government. The Opposition, led by Senator Cotton, outlined its attitude and has moved and will move a series of amendments. I rise to support those amendments, to support the general principle of an extension of powers over the non-banking area and to express some qualifications in terms of the likely consequences of those powers. To put this into perspective, some 25 years ago at least 94 per cent of all commercial credit flowed across the counters of the trading banks of Australia. There in the trading banks the loans were negotiated both in quantity and in direction or nature of the loan. Today the percentage would be substantially less than half of that.
This has occurred for 2 reasons. One reason is accidental in terms of government action. The governments of the last 2 decades have seen fit, under central banking powers, to put certain restrictions on the trading banking system which did not apply until now to those who are outside the orthodoxy of banking. The effect, therefore, has been to restrict banks and to give considerable opportunities to the non-banking area. But the development would have gone on anyhow because, as commerce and industry have become more sophisticated and more intensive, there has been a need for a money market of more specialised nature, more immediacy, and one which was not within the orthodoxy of banking of the past. So there has developed a nonbanking area- an area of finance companies, insurance companies, building societies, credit unions and merchant banks, now totalling a substantial majority of the commercial credit area.
– Stock and station agents.
– Yes, there are the pastoral companies and the stock and station agents. There is another factor, that is, intercompany lending which goes on on a daily or weekly basis in a very large fashion these days. So the orthodoxy of banking has changed rapidly. To put this into perspective, to see the problem that we are examining, we- as Liberal governments of the past have done- have applied restrictions and restraints to the trading banks to the extent that we control or influence their interest rates. We establish their statutory reserve deposits. We call off their credit if we wish to reduce credit, and we expand their credit if we wish to put more money into the community. They agree also to abide by the voluntary liquidity and government securities convention and they are subject to the direction of the Reserve Bank in relation to their lending activities. So there are considerable restrictions upon the trading banks and not so many restrictions on the others.
I do not wish to be provocative but at the outset I want to mention 2 matters that were raised by Senator James McClelland. I do not do this in any sense of aggression. The honourable senator said this measure did little more than lay down policy. I would say that this is profoundly a wrong interpretation of the Bill. The Bill provides powers which will enable direct and arbitrary action by future governments. Indeed, one of its sections enables the collecting of informtion; but the Bill goes much further than that. The honourable senator said that a significant safeguard against the abuse of the powers in the Bill would be the Senate Standing Committee on Regulations and Ordinances. As I understand the function of that Committee, so long as a regulation is shaped within the nature of an Act and correctly drawn within that Act, the Committee must allow it to pass and cannot act upon it. This Bill gives profound opportunities for the making of regulations which would be legal under the Bill. I make those comments now. What does the Bill do? It does a number of things. According to the Treasurer (Mr Crean), the purpose of this Bill is to provide the basis for the examination and, as necessary, regulation of activities in the non-bank financial sector in the interests of effective management of the community. That is a very interesting generalisation. But the purposes of the Bill in order to achieve that objective are, firstly, to ensure that certain organisations shall come under this Bill and shall be registered.
So the Bill provides that at the outset finance companies having assets in excess of Sim must register and that those retail stores having finance advanced in excess of $5m must register. There is provision also that these amounts can be varied. The Bill then provides that the Government may set about obtaining a wide range of information about these organisations. That of course is the point that Senator James McClelland made. But the legislation enables the Government to determine the asset ratios of the companies, and by increasing the ratios they must hold in special assets, it will do to the companies virtually the same as the Reserve Bank does to the trading banks in relation to statutory reserve deposits. The legislation has the power to determine the volume and direction of lending. It can fix interest rates and differential interest rates. These of course are very profound powers, far and away beyond those that Senator James McClelland indicated.
I have said that I approach this in a nonprovocative way. If what the Treasurer says are his goals, become his goals, we would find little to argue about. But that does not disguise the fact that the Bill itself entrenches certain latent powers of great magnitude. If I look to the platform, constitution and rules of the Australian Labor Party to see the goals, to see what is likely in the future in terms of the Labor Party’s directionalism of policy on banking, merchant banking and finance houses, I learn from the passage headed ‘Economic Planning’ 2 things. Firstly, item 3:
With the object of achieving Labor’s socialist objectives, establish or extend public enterprise, where appropriate by nationalisation, particularly in the fields of banking, consumer finance, insurance, marketing, housing, stevedoring, transport and in areas of anti-social private monopoly. secondly, at item 7:
Regulate hire purchase, fringe banking and other creditcreating institutions, in order to control effective demand.
Let us assume that the Treasurer is speaking frankly when he says that his goals are those in his second reading speech. Nevertheless the people of Australia are entitled to know that the objectives of the Australian Labor Party go far wider and that the platform seeks policies to be implemented which would enable the enacting of socialisation throughout the banking system. These are spelt out. I am bound to point out to the Senate that this legislation does provide powers which, if so used, could reach those goals. So the Bill is in one sense another step in the implementation- long range perhaps, or short range, depending on who is in charge- of the Labor Party’s socialist platform and its goal of socialising the banking system and the fringe banking system.
Economists have always looked towards a power over what they call qualitative and quantitative lending as a significant power in the armoury of governments. Depending how lightly or how heavily a government might use those powers, good or bad results can be induced. Governments have looked traditionally to the central banking system to control quantitatively the volume of credit through the trading banks. Governments have looked to their control over interest rates to do the same thing in the general and market areas. Governments have tried also to control through Reserve Bank leadership the qualitative lending- that is whether lending should go to housing, to hire purchase- and have sought to do it by differential interest rates. These of course are highly important matters. But if they are used, and used heavily, they can alter the whole shape of the economic society which we face today. I am bound to say that inherent in this Bill are sufficient powers so to do. The Bill has been described by Government speakers as a significant weapon in the armoury of the Government against inflation. I do not oppose the idea of the need for control of the nonbanking area in terms of economic policy and indeed in terms of stability. The platform of the Labor Party includes this:
Regulate hire purchase, fringe banking and other creditcreating institutions in order to control effective demand.
I see in that no application to the situation that now bedevils Australia. We have today, on the admission of the Government itself, inflation which is wage or cost push; that is, inflation brought about because the natural demands for nominally higher wages chasing inflation have beaten productivity and are therefore forcing prices up. We have a cost push or a wage demand inflation- and not at the other end a demand inflation, having a shortage of goods chasing money. The thought that we can solve the problems of Australia by simply cutting down the purchasing power of the people of Australia is, in my view, wrong headed.
I am all sweet reason tonight. Yesterday I heard Senator McAuliffe- I say this at the risk of misquoting him- use the argument in relation to the Post and Telegraph Rates Bill that we had underpriced the commodities. He nods to indicate that he said that. Therefore, he was saying that we had made those commodities available to people who normally would not have been able to alford them. I think he would acknowledge that that was the argument he advanced. I find that extraordinary. I find it extraordinary that one should argue that postage stamps, telephones and the ordinary postal and telegraphic systems are not the very necessities of the poor, the sick, the aged and the little people. I find it extraordinary that a Labor government should put forward an argument that the way to solve a problem of over-demand is to raise the price of commodities and therefore cost them out of the market. That, I think, is a correct paraphrase of the argument advanced by Senator McAuliffe yesterday.
The same argument is inherent in the idea that in the non-bank area one can use discriminatory interest rates or powers under the banking legislation that we are now considering in order to reduce the flow of money. What we need to do is not to take money out of people’s pockets, but to provide goods for people to buy. That may be quaint and old fashioned. But what we should be doing in the thrust of economics here it to stimulate production and to allow people to be able to purchase, and to purchase more, with the dollar in their pockets. So it is not a question of finding the weapons with which to reduce the flow of money. The Government, in its mini-Budget, already has reached in with its hands to do that. It will do that also in the Budget. It already has foreshadowed raids on the people’s earnings in the way of increased direct taxes, indirect taxes and charges. One should not look to the kind of power that is inherent in this legislation as being a power that one should use lightly or a power that one should use in this kind of an atmosphere, because all it would do would be to create an illusion. It would result in a siphoning-off of money; it would not produce more goods.
The essential worry that I have about this legislation is that a government can so discriminate, in terms of fixing interest rates or asset ratios, that it can drive companies out of business. I do not say this idly. I foreshadow that a socialist government, seeking its objectives, will set out deliberately to drive certain of the finance companies and merchant banks out of business. This is in no sense reflecting on the phrase regarding banks that I understand Dr James Cairns did not use recently. I merely reflect on the fact that here is an instrument which, if used improperly or for a doctrinaire purpose, will have the effect of closing down finance companies. Mr Crean has not seen anything particularly nasty in these companies. When referring to these companies in his second reading speech he said:
There is no denying that these non-bank financial institutions operating in a competitive environment can increase the efficiency, of the financial sector attracting funds and channelling them into the areas they are needed most.
That is a pretty healthy commendation of a group of companies which now will come under the powers contained in this legislation. I worry why the arbitrary figures of $lm for minimum assets and $5m for the retail stores in their outlay of finance should have been chosen. The great danger of fixing figures in this way- of including some companies and excluding others- is that in the weeks and months ahead we will see all sorts of manoeuvres being made in order to evade the powers provided under this legislation. For example, if a company has assets of $ 1.5m today it would be very easy to split up that company into 2 companies, each with assets of $750,000, so that they would not be subject to the powers provided under this legislation. One wonders, as one wondered in relation to the legislation which set up the Prices Justification Tribunal, why limits are placed on retail stores. A retail store which keeps its financial outlay to a limit of $4.9m apparently can escape the umbrella of this legislation, but another retail store which allows its financial outlay to get above $5m can be caught under this legislation.
For many years I have believed- I echo the sentiments of Senator Cotton in this matter; we have had many discussions about it- that there is a necessity in Australia for all those who practise the borrowing and lending of money to be brought under uniform legislation. Quite clearly this must be so, because unless we do it much of our central banking is counter-productive. If one seeks, by calling in statutory reserve deposits, to restrict the money in the orthodox banking sector, all one does is to encourage money to hop the fence and get into the non-banking sector and so produce higher interest rates. If one makes money scarcer, one makes it dearer. The whole purpose of making money scarcer is to call in money. Instead of doing that, one is expanding the flow of money in one field and contracting it in another field. This seems to me to have no sense at all. It seems to me to be absolutely necessary that we should have these powers fully extended.
Today, at a time of unprecedented inflation in Australia, we are looking at various weapons. The Liberal viewpoint, and the viewpoint that this Opposition would express, is one which would seek to lower inflation by the normal methods- by increasing the supply of goods, by reducing the number of strikes and by increasing productivity. It would go to the heart of the matter. In terms of the arbitration system, it would look towards establishing higher real wages, it would look towards establishing and reestablishing higher margins for skill and it would look towards a cooling-off period so that we could tackle inflation from where it originates. We would not look for the enforcement of doctrinaire methods in a major fashion. That being so, I say that this measure, at the very most, if used properly, is only one of many measures that could be adopted. There is the Budget, there is the arbitration system, and there are tariffs which formerly were dealt with by the Tariff Board. There is a whole range of methods of trying to get a balance of supply and demand in an economy so that the real value of money is maintained and so that, through productivity, real purchasing power can be increased. Everything that we do for the future should be aimed not only at decreasing inflation but at putting more real value into the pockets of the ordinary working people. We must be careful that we do not use only the heavy hand of restraint.
I conclude by repeating that, whilst I believe in the principle of uniform banking laws, I worry at the inherent and very real power of arbitrary discrimination which lies in the Bill. I turn to the Australia Labor Party’s platform and see that it has discharged the main planks which I have read out, and I worry that if the Party or its successors should seek to implement those planks the powers lie within the legislation. We look towards the bona fides of the Treasurer and his Government in pursuing a moderate line in the use of these powers. I regret to say that I do not believe that the Finance Corporations Bill, in any of its operations, will have any significant effect in reducing inflation in Australia. I believe that we must fight inflation in other ways. I commend the amendments which will be moved during the Committee stage.
– My remarks will be brief. I suppose it would be easy to share the concern of Senator Carrick about the Australian Labor Party perhaps being able to implement its ideological views through the powers conferred on the Government by this Bill and about the Bill perhaps not having any immediate effect on the inflationary scene which is bedevilling Australia. However, I do not share the somewhat pessimistic view which I feel is pervading this side of the chamber that we on this side will be in Opposition forever. I look forward to the day, very soon, when we who now sit on this side of the chamber will be in charge of and administering this legislation. That is the more optimistic view which I take when I say that I support the Bill.
It has been quite evident that parallel with the growth of controls over Australia’s monetary system- one could argue that this may be by chance or it may not be by chance- Australia has enjoyed an unparalleled sense of prosperity. I can certainly sympathise with those who manage our economy and who say that they would like to be able to draw into the general financial controls in Australia these non-banking institutions. I can only say, in a general sense, that I am worried, as a number of Australians are, that so much of the financial requirements of Australians are met today by the non-banking system when they ought to be met out of the banking system. I believe that the banking institutions in Australia are far too conservative in their lending programs. I believe that there are far too many refusals today of applications by fine individuals who require finance. They are turned away, although they have the security, and are told to approach a finance company. So we have what I believe is a very direct inflationary system in which an individual pays about 20 per cent interest on money borrowed from a finance company instead of the bank overdraft rate. The sooner we can expand our normal banking system to take the place of as much of the high priced money as possible, the better Australia will be.
Institutions outside the control of the banking system which bid against each other for funds which are scarce, at least for their particular uses, are encouraging the higher price for money and are involved in creating some additional pressures in the inflationary scene as we know it. So I will be happy to listen to support of the amendments which have been foreshadowed, although I believe that the Bill ought to go through pretty well as it is presented. But I am quite happy to Listen to the amendments and to see how they are supported in Committee.
I repeat that my general view is that whilst these non-banking institutions have certainly been able to mobilise a great deal of capital and to place it in the hands of consumers who have supported to a very large extent the industries of Australia, particularly in my home State of South Australia where a great deal of Australia’s consumer durables are produced, I regret that a person can go to one counter of a bank and be told that no funds are available and can go to the next counter, to the finance part of the organisation, and be told that funds will be available. Whilst there may be all sons of reasons for this- how those funds are collected, a different market and a different interest rate behind the collection- it still seems rather absurd to the customer who is denied the traditional finance which he would have been given some years ago.
– Especially for some nonessential purpose. One can get finance easier for a non-essential purpose.
-Not all banks are subject to across the board criticism. In the last few months, even when finance was supposed to be tightening, one bank was advertising personal loans and was saying: ‘If you want a set of drums, come and see us. If you are a young person, we will provide finance by way of a personal loan’. I think that is a good way of providing finance. Instead of having to use high priced money, young persons were being attracted to an interest rate which is sensible and which is within their capacity to pay. But there is not enough of that money. That is the assessment which I make, at a very superficial level.
Representations have been made to me, as no doubt they have been made to all Parties and all members, regarding a number of amendments. I am attracted to the complaint- I suppose one could call it that-that different organisations have a different attractiveness to investors. It is almost impossible to fix a simple general interest rate which financial institutions can offer to potential investors. Not only does their attractiveness alter depending upon their backgroundwhether they are Australian institutions or whether they are overseas based- there is also a different attractiveness in the market in the various States. I have been asked by one representation to inquire whether the Government, in implementing clause 15, will give an undertaking that it will allow differential rates to suit the market as it is now catered for in the demand and supply situation of the money market. With those remarks, I support the Bill.
-To me, clause 1 5 of the Bill is a very dangerous one. It refers to the control of rates of interest. I know that the control of rates of interest may not sound so very dangerous in itself, but where that control might have a political outlook about it it could be very dangerous indeed. The purpose of the Bill is to control organisations outside the banking area. I have in mind the building societies, which have played a very splendid part in the building of homes for people throughout the nation. I feel that they have been very generous in the way that they have made advances. I think that most of these institutions are controlled, to a reasonable degree, by the State governments. Up to the present I do not think that the control by the State governments of those organisations can be queried adversely to any great extent.
It is all very well to say that we want more institutions under the control of what we know as the banking system. Why do we want to limit the control to the banking system? I was interested to hear Senator Hall speak. He plumped for the banks. During the course of his speech he pointed out the conservatism of the banks in the matter of extending finance. There is no doubt that before these other institutions came into existence the banks in Australia were the most difficult organisations with which to arrange finance. They were as tough as nails when it came to getting loans from them. The situation then might have been all right for people like Senator Steele Hall and others who live in the capital cities, but people living in distant regions away from the capital cities are just names or numbers and their requests have to be submitted by the local bank managers and posted to headquarters in Brisbane, Sydney, Melbourne, or whatever the case may be. These people are not as close to the bank authorities as those who live in Adelaide, Sydney, Melbourne or Brisbane where the banks have their headquarters. As a consequence I do not think that people in distant areas get the deep consideration that is received by people closer to the banks’ headquarters. People in the cities have more pull in getting finance.
What is the situation with the building finance organisations? Building societies are scattered over the length and breadth of the country. People living in Adelaide, for example, have a pull with their bank because they live close to its headquarters and can be interviewed personally. In the same way such people are known to those who control the building finance organisations. They have personal contacts, their character and standing are known, and it is easier for them to deal with the organisations than is the case for people living elsewhere. I would like to see competition in the system of financial institutions because the banks have sole control. No organisations step further into areas of other people’s business than do the banks and they are not always honest in the way that they do that. They will come at all sorts of stunts in order to get into other people’s business. Why do we want to make the banks the sole financial organisations?
It is rather interesting that a Labor Government now is trying to strengthen the banks when a while ago Labor was trying to nationalise them.
– That was to strengthen them further.
– Does the Labor Party want to strengthen them before it nationalises them?
-I think that the system operating now is all to the good of the people. If this Bill is aimed at reducing the rate of interest charged by building societies and other organisations similar to banks in the long run it could well sound the death knell of many organisations outside the present banking system. I think that that would be bad for Australia generally. People in some regions of this Commonwealth have closer contact with these organisations and therefore have a better opportunity in their dealings with them than those who have to deal in an impersonal way with organisations with headquarters in the capital cities. This could be a very serious matter. Control having been handed over by means of this Bill I believe a definite and purposeful step could be taken in order eventually to eradicate many of these other financial organisations. Why is the Government so keen on building up the banking system and excluding other people? Senator Steele Hall says that he believes in the banking system being strengthened but do honourable senators not think that this might be the right time to set up a system whereby the banks are limited to banking only and are not permitted to engage in all sorts of ramifications and other types of business? Banks in many respect have a monopoly but they also like to dabble in everybody else’s business.
I think that the main element of danger in this Bill is contained in clause 15. That clause provides very great power and might well sound the death knell of the freedom of enterprise that has developed in these other financial institutions. That would bring us back to the pure banking system and would be a bad thing for this country. It is all very well for the Government to say that although this clause is included nothing will happen. I have seen that sort of thing before and when things have happened subsequently people have regretted that they were not more vigilant and more wide awake when the opportunity was available for them to act. Because I am very worried in relation to clause 1 5 1 will oppose the Bill.
– in reply-The Opposition appears to be in general agreement with the substance of this legislation. I think it would be fair to say that there is general recognition throughout the community, and certainly in the Parliament, that this quite dramatic shift of resources from the banking system into what is commonly called the fringe banking system justifies controls being exercised by this Parliament over the activities of bodies forming the fringe banking system. Perhaps had the previous LiberalCountry Party Government been a little more sure of its position it might have acted in a similar way to that in which this Government is acting now. I refer to the period prior to the concrete pipes case.
The Government has given a great deal of thought to this legislation because we realise that overt and ill considered action could disrupt what are now very important sections of our financial structure. For that reason the Government is not defining precisely the manner in which the powers written into this legislation will be used. I think Senator Cotton described this Bill quite accurately when he said that it was an umbrella piece of legislation. In drawing it up we have endeavoured to write in safeguards which will ensure that this fringe banking system is allowed to continue with its legitimate activities. But because of the importance of the fringe banking system in our economy it is necessary that certain controls over its activities be in the hands of the Australian Parliament.
Many amendments are to be moved at the Committee stage of this Bill and I think it is best that they be dealt with in detail at that time. I think I should deal at this stage with one or two points made during the course of the debate. I do not propose to accept the invitation to debate the question of the economy at the present time, as was suggested by Senator Webster before the sitting of the Senate was suspended for dinner. It was unfortunate that Senator Webster, in quite strong contrast to the tone set by both Senator Cotton and Senator Guilfoyle who made measured and sensible contributions, attempted to use this debate for political purposes in the light of the current economic position. I think it important to point out that this legislation is not designed to combat inflation. It has been introduced to control the activities of these very powerful institutions. Quite possibly it could be legitimately said that in the course of exercising those powers anti-inflationary measures would become effective, more by default than by design, but it would be wrong to suggest that this legislation would be used for that purpose.
Senator Guilfoyle made one or two comments which I may have misunderstood but I want to assure her that we are not granting the Reserve
Bank the same powers over the financial corporations covered by the Bill as the Reserve Bank has over trading banks. We do not see the need to do that and I do not think that anybody on the Opposition side sees it in that way either. It is also important to realise that although there are certain arbitrary powers which a governmentwhether it be this Government or any future government-may use, and I think this was the point that Senator Hall was making also, those arbitrary powers should not be abused. The Treasurer (Mr Crean) has given an assurance that this would not be the case. Senator Guilfoyle asked whether this legislation would be used for political purposes or in the national interest. This point is covered by what is written quite clearly into clause 3 (b) of the Bill which provides for: the regulation of those activities for the purpose of contributing to economic stability, the maintenance of full employment, the efficient allocation of productive resources and the economic prosperity and welfare of the people of Ausralia.
That is really the key to the powers which the Government would want the Reserve Bank to have in respect of these institutions. I can assure the Senate that there is no intention on the part of the Government to abuse in any way the powers which would flow to the Reserve Bank from the passage of this legislation.
During the course of the debate Senator Webster nominated 2 companies, Myer Emporium Ltd and G. J. Coles & Co. Ltd, and said that he could not see why a company such as Myer’s should come under the ambit of this legislation while a company like Coles would not. The reason for Myer’s being covered is that it extends credit whereas Coles does not. It would be inequitable to the finance companies to exclude retailers who provide similar types of finance to that provided by the finance companies. I am pleased to see Senator Cotton nodding his assent to that interpretation. This is a good example of how this Government has been careful in trying to ensure that the normal pattern of trade and commerce is not unduly interrupted by this legislation.
The other matter which I feel should be referred to before we close the second reading debate is that of regulations and determinations. It is true that under this legislation the Government would have fairly wide powers of regulation. It has been stated by the Treasurer that there would be proper consultation with advisory bodies before those regulations were made, and that those advisory bodies would include members and representatives of industry in this country. After the making of those regulations, which of course may be disallowed in the normal course of events, it would then be prerogative of the Reserve Bank to make determinations within the guidelines laid down in the regulations. It would be wrong, I believe, for the Government or the Reserve Bank to be tied in such a way that it could not make determinations without prior consultation. Those regulations should be made in the light of consultations and then the determinations made after that. I know that we have a lot of other business we want to deal with tonight, so I will close on this note: I am pleased that in the general approach to this matter there is an acceptance by all parties of the general proposition which has been put forward in this legislation. Even though we may find during the course of the Committee stage that there is some disagreement, the main intent of the legislation I am sure will be carried. It will be something of great benefit to the economic management of this country.
Question resolved in the affirmative.
Bill read a second time.
Clause 1 agreed to.
Clause 2 agreed to.
The object of this Act is to assist the Australian Government to achieve effective management of the Australian economy by providing a means for-
– I have circulated a number of amendments which should be in the possession of all honourable senators. In respect of clause 3, I move:
The reasoning behind this proposed amendment is that we believe that housing is an essential element of a reasonably stable and prosperous economy. We are not impressed with the proposition that housing should be wisely used as an economic regulator and are to some extent disturbed by the tendency at present to use it as an economic regulator and to use it excessively. We wish to insert these additional words because we regard an adequate level of finance for housing as a desirable objective. We do not wish to see the provisions of this Bill hampering the satisfaction of the genuine need for housing in the community. We believe that it is imperative not to restrict the supply of housing available to people at a reasonable rate in order that they may acquire their own homes in the manner in which they wish to acquire them and in a manner they can afford. That is a very brief set of reasons for this proposed amendment.
I want to elaborate slightly on the dangers of using housing as an economic regulator. There is a very good Reserve Bank paper, which has been updated, called ‘The Indicator Approach to the Identification of Business Cycles’. It demonstrates quite clearly that we can identify the business cycles of what might be called a boom and a recession, a peak and a trough or whatever other term we like to use to describe the wide fluctuations in the business cycle which are clearly identified in the paper as being preceded by downturns and upturns in housing activity. So we in the Opposition argue that there is a strong case for sustained level of finance for housing at reasonable rates in the Australian community so that the provision of housing is in neither great excess nor great deficiency. It is for that reason that we suggest to the Government that this would be a wise amendment to the Bill which fundamentally is designed to achieve a more sensible monetary climate.
– The Government will oppose this amendment. The question may well be asked at the beginning: What is the meaning of the word ‘adequate’? The object of the Bill is to assist the Government in the management of the economy. The Bill is not directed specifically at housing finance or at any other form of finance. If we include a specific objective with regard to one particular sector of the economy, then we might well do the same with regard to some other particular sector.
– We would particularise.
-As Senator Devitt points out, we would particularise. It is not the intention of the legislation to do that. Of course, there is also the point that specific reference to anything, including housing, in the objectives of the legislation could be used as grounds for challenging its constitutional basis. By keeping its wording in the broader terms and in the form in which we find it now, we overcome that problem and also give the same treatment to all forms of financing in the economy. I suggest that we are taking a safer course and, I think, a fairer course if we leave the Bill as it is. For that reason I have to indicate that the Government will oppose the amendment.
– I refer to the comments of the Minister for Agriculture (Senator Wriedt). I have no wish to become involved in an argument on constitutional interpretation, except to say that it has been my experience that mostly when an amendment is to be rejected the excuse that is usually used as a last resort is that there is a constitutional problem that cannot be overcome. I am not really all that excited about that argument. I think the proposition that the use of the word adequate’ presents problems for the people who will administer this legislation is valid only in the context of failing to recognise my earlier argument that an essential factor in maintaining an even monetary system in Australia is to have regard to the housing position and not to use the housing industry as an economic regulator. I think that the evidence is demonstrable and it is manifestly clear that to do so produces a situation of business cyclical movement up and down.
That is why it is suggested by the Opposition that the amendment represents a wise precaution which will help to encourage the flow of funds for housing and would be wisely inserted in the legislation to protect the economy and to overcome excessive fluctuations in the Australian monetary scene. If the Government will not accept that amendment, then it will not accept it. But the Opposition holds the view that economic regulation by changing the housing position up and down has proved to be unwise. It is not a stable method of operating. I suggest that the Committee would be wise to recognise this by making the amendment we suggest.
– It concerns me that Senator Cotton has some fear that there is some implied suggestion on the part of the Government that what he suggests would occur. Let me assure him that this is not the case. I believe that at the present time this Government has a satisfactory record in regard to housing. There is nothing in the legislation to suggest and the Treasurer (Mr Crean) has said nothing to indicate that there would be any abuse of the legislation or any overlooking of adequate finance for the housing sector. For that reason I must insist upon the Government’s position that the clause remain in its present form.
-I intervene in the debate at the Committee stage to express my dismay that the Government should hesitate to accept a proposition such as that which is embraced in Senator Cotton’s amendment. It is intended to make clear one of the objectives of the Bill with which we are dealing and to ensure an adequate level of finance for housing. Of course, Mr Chairman, I remind you, as I had occasion to remind the Senate last night, that in the speech on the economy that we heard last week from the Treasurer (Mr Crean), whom the Minister for Agriculture (Senator Wriedt) represents in this chamber, we were told that the Government was specifically enforcing financial controls and restrictions to limit the number of housing units that would be financed through the banking system. We were told that the Government was specifically applying those restrictions to the private sector and it was stated that that action was being taken for the very purpose of enabling the Government to expand the public welfare section of housing which it claimed was for the more needy persons in the community. Mr Chairman, I bring those matters to your attention.
At the present time, the interest rates that home seekers have to pay have gone up to extortionate levels. This has all happened because this Government thought that housing was absorbing too much finance. Its policy now- very bashfully admitted by any member of the Government, but there to be read in every text that is written on financial control- is that it is actually restricting the finance available to the housing industry at the present time because it thinks that the housing demands on finance are unfair. I suppose that that is why the Government is resisting what anybody would think was a perfectly innocuous, innocent and fair minded amendment stating that one of the purposes of this legislation is to ensure an adequate level of finance for housing.
– No one would deny that the Governmentany government- should provide for an adequate level of finance for housing. But there are other things -
– What about the GovernorGeneral’s Speech?
– Here is the doctor interjecting. He had better have a look at the medical benefits funds in New South Wales.
– What great superiority do you have?
– At least I address the Chair courteously. I do not abuse supreme court judges and I do not abuse people who cannot defend themselves in the Senate chamber. The situation is that several other things could be added to the legislation if it were so desired.
– Did you support the petrol subsidy tonight?
– Has the honourable senator finished speaking or is he still mumbling in his beard over there? It must amaze young people to hear the licence that a 70 year-old senator receives. As I have said, the situation is that other things could be added to the legislation. But I say that the words ‘economic prosperity and welfare of the people of Australia’ comprehend an amazing number of things. Obviously, housing would come into that category, as would conservation and parklands, if it were so desired, along with many other things. I know that the Opposition has moved this amendment with the best intentions in the world. But I believe that if honourable senators opposite examine the words ‘economic prosperity and welfare of the people of Australia’ they will see that that phrase comprehends the proposition they have put forward and, most certainly, comprehends other propositions that could be put forward by way of amendment.
– I cannot quite see why the Government is so adamant in not accepting this amendment. It seems to me to be a statement of wish and desire rather than any disciplinary or mandatory part of the Bill. In fact, if it is to have any force it certainly could not work in the interests of finance companies because here we are dealing with higher priced finance which is usually bridging finance or certainly most expensive finance for housing. If this type of finance is to be regulated in the interests of housing, it must be regulated in a fashion which will reduce the interest rate which it will bear. If that is what the Opposition wants, I think that it would work very much in favour of the Government’s intentions to regulate and, where it can, reduce the high cost of this type of finance to the community. So I do not see the amendment as containing any more than an expressed wish. I cannot see why we cannot have ‘housing’ alongside ‘full employment’. It is necessary for people to have a job and it is necessary for them to have a roof over their heads. I cannot see it as any more than an expressed desire which cannot but work in favour of lowering interest rates if it has any effect whatever.
- Senator Wright has reminded me that it is a long time since we have had a full and interesting Committee debate in this chamber. This debate may well be taking that direction. Housing is one of the most important economic regulators a country has and if it is subject to violent fluctuations up and down it subjects the whole economy to danger. Someone referred to the fact that the present Government’s housing record is good. That is a matter of individual judgment but reports currently available to me as the Opposition’s shadow spokesman on manufacturing are that private homebuilders are looking at a downturn of almost 50 per cent in the next 6 months. I refer honourable senators to a publication titled ‘The Housing Cycle in Australia’ with which I dealt a little earlier. It refers to housing cycles and cycles of excess demand and deficiencies and includes this comment:
These cycles in housing have an importance that extends well beyond their implications Tor the industry itself. The surge and ebb of housing investment are basic initiating factors in the rises and falls in the whole business cycle and less directly but nonetheless importantly the financial market.
I think that Senator Steele Hall has taken the point very well that this is not to be something which ought to be subject to the vagaries and hazards of the economic situation. There ought to be a sustained demand by people to have houses as there is a sustained increase in population. It is getting to be of the same order of importance as a principle we all espouse- that is, full employment. We can see no harm whatever in this amendment being accepted. .
That the words proposed to be inserted (Senator Cotton’s amendment) be inserted.
The Committee divided. (The Chairman- Senator Webster)
Question so resolved in the affirmative.
– I move:
This is a simple amendment which the Opposition believes rounds off the clause making its purpose abundantly clear and beyond confusion.
– I simply wish to give support to the amendment moved by Senator Cotton. It links with the thought I expressed earlier that the regulation of these activities must not be used in the political interest. In his response to the second reading debate the Minister for Agriculture (Senator Wriedt), who represents the Treasurer (Mr Crean) in this chamber, referred me to this clause. I believe that the words proposed to be added by this amendment strengthen our thought that this provision should not be used for political purposes to achieve a reduction in interest rates which may not necessarily be in the national interest of our economic management.
– The Government opposes the amendment, one of the reasons being the same as that for which it opposed the earlier amendment, namely, that the amendment if carried will make the legislation more likely to be subject to challenge. It is a matter of whether a government- this Government or any other government- wants a further restriction placed in the legislation. This is the essential point. If the Opposition, with the support of the Independent senator and Senator Hall, is prepared to do that, obviously the amendment will be accepted but it is important that honourable senators, especially Senator Hall, be made aware of the situation. For that reason the Government opposes the amendment.
– I take the point put forward by the Minister for Agriculture. I believe that the first amendment was expansive and that the one now under consideration is limiting. I do not agree that directions can be given in a way which could create or form a basis for challenge to the operation of the Act later. I do not intend to support the amendment.
-The Minister for Agriculture in some way conceives that the inclusion of this provision would expose the Act to a greater risk of challenge. But I point out that his own Bill is the Bill that includes the object to which this amendment refers. Clause 3 of the Bill states:
The object of this Act is . . .
The object is then expressed in the clause. All that the last amendment did was to include in the aggregate expression of that object particular reference to an adequate level of finance for housing. The amendment moved by Senator Cotton which we are now discussing seeks to add at the end of clause 3 the following words: and determinations or directions shall not be made or given under this Act except for the purpose of achieving that object.
This amendment does not merely contain the particular object of housing but is concerned with the aggregate or whole object, that is, to assist the Australian Government to achieve effective management of the Australian economy by providing a means for certain proposals which are set out in paragraphs (a) and (b) of clause 3.
The next matter to be observed is that all the Government speakers who have induced acceptance of this Bill on the second reading have argued that the regulations will be subject to the scrutiny of the Senate Standing Committee on Regulations and Ordinances. But determinations and directions given under regulations do not come within the authority of that Committee. The Committee has power to deal only with regulations. The amendment proposed by Senator Cotton is essential if the spirit of that proposition is genuine and if we are to be assured that the regulations will be open to our scrutiny through the Regulations and Ordinances Committee. If one of Senator Cotton’s later amendments is accepted we will go further in ensuring that we scrutinise the regulations. But the amendment at present under discussion is essential to ensure that determinations and directions given under the regulations shall not be given except for the whole object and not merely the specific object of housing under the Act.
It is inconceivable to me how anybody can consider the validity or the value of expressing an object unless they accompany it by a provision that the operation and administration of the provision by means of directions and determinations made under the regulations shall all be directed to the achievement of the object. I submit that logic requires the acceptance of this amendment by the whole Committee.
That the words proposed to be added (Senator Cotton’s amendment) be added.
The Committee divided. (The Chairman- Senator Webster)
Question so resolved in the negative.
Clause, as amended, agreed to.
Clauses 4 to 1 1- by leave- taken together, and agreed to.
Clause 12. (Corporations subject to Part I.).
-This clause, which is headed ‘Application of Part’, deals with the regulation and control of the business of financial corporations. It says that this Part does not apply in relation to a registered corporation unless the sum of the values of all the assets of the corporation and its related corporations exceeds (a) $5m or (b)- and this is the matter on which I want to focus attention- if a greater or lesser amount is prescribed by the regulations, not in toto but in relation to the category in which the registered corporation is included, the amount so prescribed.
I would like the Minister for Agriculture (Senator Wriedt) who represents the Treasurer (Mr Crean) to tell me whether my interpretation of the Bill is correct. Does the Bill give authority to divide corporations into 10 categories? Those categories have not yet been listed separately; at least I do not see them in the Bill. Honourable senators can use their imagination as to the categories and how the financial corporations will be divided into 10 classes. This clause says that in relation to each class or category the regulations may fix any amount above $5m or below $5m as the qualifying figure to bring that category within the scope of this Part of the Act. So by the regulation process the Executive of the day has the power to discriminate between the categories and to fix an amount which is the magnet by which that particular category becomes subject to the Act.
This point gives importance to an amendment, which I see has been circulated by my colleague Senator Cotton, to ensure that the regulations under this Act have very special attention and operation. But even with that attention this clause is altogether too discriminatory and arbitrary. There should be a much more objective description of the ambit of the value of assets that will subject any particular category of corporation to the authority of the Act.
– I think it is quite likely that we will be continuing the Committee stage of this legislation tomorrow. We have no constructive amendment to this clause but after listening to Senator Wright, the Minister and his advisers might care to think about it between the time we adjourn tonight and tomorrow, and if they have any suggestions that may overcome the problem raised by Senator Wright we would be more than pleased to contemplate them.
– I am not quite sure whether Senator Cotton was suggesting that the Opposition should have time to consider this clause. It is really a matter of whether it is intended to move an amendment, even if it is moved tomorrow. In relation to the matter raised by Senator Wright, again there seems to be a feeling that there is some underlying motive to allow the Reserve Bank, or the Treasurer in this case, to do certain things which may not be acceptable to the corporations involved. But the Bill does not lay down the number of categories which may be formed. It is an arbitrary figure which can be determined by the Reserve Bank in conjunction with the Treasurer. The Reserve Bank shall advise the Treasurer as to the respective categories in which registered corporations should be included.
Sub-clause (4) of clause 10 says that in determining the category the Treasurer shall have regard to:
I am not sure whether some alteration to that is envisaged. I personally have no objection if the Opposition wants to hold this clause over until tomorrow- assuming that the debate will be continued tomorrow- with the thought of perhaps moving an amendment, but at this stage it seems to me that adequate safeguards are written in under those 3 paragraphs of clause 10 (4).
– The Opposition would appreciate it if the Minister for Agriculture (Senator Wriedt) would hold this matter over until tomorrow to give Senator Wright and the rest of us time to consider it. We may be able to find another form of words which will be acceptable to the Minister and which may overcome Senator Wright’s problem.
Further consideration of clause 12 postponed.
Clause 13. (Control of asset ratios of registered corporations.)
– I wish to direct attention to a further item of discrimination which will be authorised under this Bill unless some corrective measure is taken in relation to the clause. This clause has the heading Asset Ratios’. It provides that the section applies if certain regulations are made. Paragraph (b) of clause 13 (1) reads:
The Reserve Bank may make a determination by virtue of which each registered corporation, or each registered corporation that is included in a specified category, … is required, within such period . . . as is prescribed, to ensure that-
the assets of the corporation include prescribed assets of a particular kind or kinds; and
the sum of the values of the assets of that kind or those kinds included in the assets of the corporation is not less than an amount ascertained in accordance with the regulations.
So the financial corporations may be divided into 10 categories and one of the categories may be a hire purchase company financing patents. There may be a number of corporations- say 2Vi or something like that- in that category. One could then say that categories A, B and C shall have 90 per cent of assets in Commonwealth stock; or if one does not have a predilection this week for Commonwealth stock, one could say that they shall have within their assets 90 per cent of assets in farm machinery.
The clause gives the Reserve Bank the power to make a determination which by an even vote- 30 all- we did not require to be enforceable. But under this the Reserve Bank may determine a category of financial corporations, and may determine, not by regulation that can be disallowed or disapproved by this Parliament, but by a determination which is unexaminable by this House, that it shall have within its assets 90 per cent of a particular kind of asset. I have given odd examples only to attract interest. But in the commercial field, where there might be a category of financial corporations which finance motor vehicles, the Reserve Bank may take it into its head that today that category shall have in its assets 60 per cent of motor cars, 20 per cent of trucks and 20 per cent of tractors; and next month alter the determination and vary the proportions. Surely that brings to mind the enormity of the power, even if it were based on a regulation examinable by the Senate. But it is based upon a determination which is beyond the reach of the Senate: We cannot review it. Under the clause the Reserve Bank may prescribe by determination particular classes of assets. It seems to me that the clause requires the inclusion of some means whereby the Senate may supervise any arbitrary discrimination against companies in particular categories in regard to the assets they hold.
-Replying briefly to Senator Wright, I would have thought that all he has said is covered by clause 10 (4) (a), (b) and (c) of the Bill which we discussed during the debate on the previous amendment and which I read to the Senate. Senator Wright comes back to this theme that some power which has some bad motive will be exercised and should not be allowed to be in the Bill. I believe the clause should stand as printed and that we should proceed to vote on it.
Clause agreed to.
Bill received from the House of Representatives.
Standing Orders suspended.
Bill (on motion by Senator Murphy) read a first time.
– I move:
This Bill is designed to give effect to the Government ‘s decision, which the Prime Minister (Mr Whitlam) foreshadowed during the election campaign, to strengthen the Prices Justification Tribunal and extend its scope in certain important ways. The Tribunal started life on 1 August 1973 and in the short period of its existance it has more than proved its worth in restraining price increases by major companies. It has built up its authority and prestige, and its findings are not taken lightly in any quarter. It has conducted 15 public inquiries and further important inquiries are in progress and in prospect. In some 200 cases, proposed price increases have been reduced by companies without public inquiry after initial discussions with the Tribunal. In no case has a company proceeded contrary to the findings of the Tribunal. This is an admirable record, and one that can be built on. The Government, handicapped as it is by lack of adequate constitutional powers to combat inflation, is nevertheless determined to continue the fight with all vigour, with the aid of the instruments at its disposal. The Prices Justification Tribunal is an important such instrument.
There are 2 fields in particular where the Tribunal can make a larger contribution if it is given the necessary powers and resources. These are the field of retail prices and the related field of prices of imported goods which, on the evidence available to us, have not reflected the effect of tariff reductions and currency revaluations as they should have done. We have decided to give the Tribunal the necessary powers and resources. Firstly, it is clear that the impact of the Tribunal in these and other fields is limited because it is at present restricted in all its dealings to companies with an annual turnover in excess of $20m. The Bill therefore removes any such restriction in relation to inquiries made by the Tribunal, either at its own discretion or as required by the Government. The limit, however, remains insofar as it concerns the obligations by companies to notify price increases. In other words, the Tribunal will now have a general power to inquire and report into prices charged by companies, irrespective of their turnover, or the industry concerned, but the obligation to notify price increases still applies only to companies in the over $20m class. Where the Tribunal itself exercises this general power, it will have 4 months to conduct its inquiry and furnish its report. The other provisions of the Act relating to timing remain unchanged except that, in order to provide a little more flexibility, the Bill extends the period of 2 1 days available to the Tribunal to decide whether or not to conduct an inquiry. Any such extensions are, however, required to be with the agreement of the company concerned.
The reasons for proceeding in this way are clear. It is desired to give the Tribunal a wide discretion not only in relation to price increases but in relation to all prices charged by companies, but without subjecting it to further burdens in the processing of notifications by a greatly increased number of companies. The Tribunal will employ these additional powers, particularly, but not exclusively, in actively inquiring into and reporting upon both retail prices and the prices of imported goods. For these purposes, we shall provide a modest expansion of the Tribunal’s staff and will ensure that the Tribunal is backed by the collaboration of other departments and agencies. Steps have already been taken to this end in conjunction with the Department of Overseas Trade, the Department of Customs and Excise and the Australian Bureau of Statistics. In order to reinforce the influence of the Tribunal in the most economical manner possible, it has also been decided to empower the Tribunal, as an alternative to stating that it does not intend to hold an inquiry in the case of a particular proposed price increase, to notify the company concerned of any lower price that it considers to be justified. The company concerned will then have 7 days to notify the Tribunal whether it accepts this lower price or prefers to proceed to public inquiry. This provision should enable the Tribunal to cover a much wider field without undue strain on its resources.
I come now to certain other provisions that are of somewhat lesser policy significance but should still considerably assist the work of the Tribunal. It has been decided, in order to facilitate the simultaneous conduct of major inquiries and to assist the Tribunal generally, that provision should be made for 2 Deputy Chairmen instead of one as at present. It has also been decided to extend the maximum period for appointment of members from 5 to 7 years in order to increase the attractions of appointment to the Tribunal, particularly in the case of suitable members from private industry. We have also changed the procedures whereby the reports of the Tribunal are made public. Henceforth, the reports will be made public by the Tribunal itself and not, as at present, by the Minister. This is a machinery measure to avoid the unnecessary and somewhat cumbersome procedures that now operate. In addition, certain minor amendments have been made in the interests of clarification and consistency which will, if necessary, be explained in the Committee stage of the Bill.
It is the Government’s view, after close examination and full discussions with the Chairman of the Tribunal, the Honourable Mr Justice Williams, that the provisions in this Bill will greatly increase the effectiveness of the Tribunal in combating inflation, and will do so in a manner that will continue to attract the co-operation of the business world at large. It is for this reason that we have decided not to include any penal sanctions to make the findings of the Tribunal legally binding. We will continue to rely on justification and co-operation just so long as this course retains its present effectiveness. The Government regards this Bill as an important measure to combat inflation in Australia and, in the belief that it will attract the support of all those who share the national concern on this matter, I commend the Bill to the Senate.
Debate (on motion by Senator Cotton) adjourned.
Bill received from the House of Representatives.
Standing Orders suspended.
Bill (on motion by Senator Wriedt) read a first time.
– I move:
In speaking to the Health Insurance Levy Assessment Bill 1974 1 mentioned that the levy is to be imposed on people residing in Austrafia and that its collection is to be integrated with the collection of income tax. Australia’s double taxation agreements provide, among other things, that Australians who receive income from overseas that is included in their taxable income are to be entitled to a credit for foreign tax on the income. This Bill will ensure that the arrangements for relief of double taxation apply to both income tax and health insurance levy. I commend the Bill to the Senate.
Debate (on motion by Senator Cotton) adjourned.
Bill received from the House of Representatives.
Standing Orders suspended.
Bill (on motion by Senator Cavanagh) read a first time.
– I move:
This is a 19-page second reading speech. It has been read in another place and it appears in the Hansard of that place. If it is desired that I should read the speech, I will do so, but I seek leave to have it incorporated in Hansard.
-Is leave granted? There being no dissent, leave is granted. (The document read as follows)-
For the second time the States Grants (Urban Public Transport) Bill is presented to Parliament in order to ratify an Agreement between the Australian Government and the States to improve the quality, capacity, efficiency and frequency of the public transport in our major cities. A commitment was made by the Australian Government to accept a share in the responsibility for the public transport systems of Australian cities in the 1972 policy speech of the Prime Minister (Mr Whitlam). We have always been determined to honour that commitment. The States Grants (Urban Public Transport) Bill is a milestone in the history of transport in this country, marking as it does the first allocation of finance by an Australian Government for State urban transport systems.
All State governments have accepted the terms and conditions contained in the Agreement. The dates of signing of the Agreement were:
The Western Australian and South Australian Premiers on 28 March; the Prime Minister on 29 March; the Victorian Premier on 4 June; the Queensland Premier on 11 June; the Acting New South Wales Premier on 12 June; and the Tasmanian Premier on 1 3 June.
It is to the credit of this Government that despite delays we have taken action in so short a time to provide a major Austraiian Government injection of finance in order that transport within our cities will be revitalised.
But let me stress that urban public transport has suffered no unexpected overnight demise. Rather these systems have painfully withered away over the last 50 years. It is to the everlasting discredit of honourable senators opposite, who occupied the Government benches in the Senate for 23 years, that the plight of our cities was ignored. Consequently, the transport systems which daily serve two-thirds of Australia’s population were allowed to become so run down that they are used only when the traveller has virtually no alternative.
Under the States Grants Bill an amount of $7 1.91m is appropriated for expenditure on urban public transport projects that were scheduled to commence in 1973-74. Of this, $3 1.09m was intended to be spent in 1973-74. It is the responsibility of members of the Opposition that not one cent of these funds has yet been provided as this Bill would have been passed several months ago but for the recent election. The States have been forced to battle on their own for longer than was necessary.
In many overseas countries with comparable standards to Australia it has long been accepted that central governments must be involved in the provision of public transport services in cities. In the United States the Federal Government provides up to 80 per cent of the cost of projects aimed at improving these services. In Great Britain the Government provides up to 75 per cent of the capital cost of urban public transport improvement projects and in West Germany the Federal Government sets aside 40 percent of additional fuel taxes imposed in 1967 for this purpose.
It is tragic that past Australian LiberalCountry Party governments have failed to accept their responsibility in this field. They hid behind the tired old argument that it was a State responsibility. However, in their inevitable fashion the men of the past finally realised in preparing ‘policies’ for the recent election that the community demanded that the Australian Government, regardless of whichever party it was, take action in this field.
For years the present Liberal-Country Party Opposition neglected the needs of the State public transport systems while pumping money into roads. Public transport has been allowed to run down to a condition where it is now hardly a realistic alternative to private motor vehicle travel. The consequences of this approach, which was contrary to the policies and experiences of so many overseas governments, is that today’s cities are less attractive places in which to work and live. We are now in a position where congested roads and air pollution are the norm rather than the exception.
The pollutants emitted from the internal combustion engine are carbon monoxide, hydrocarbons, oxides of nitrogen and particulates. They result mainly from the incomplete combustion of the fuel and from high temperature oxidation processes. Some emissions are pollutants themselves, such as carbon monoxide, smoke and lead. Nitrogen oxides, while pollutants, also react with hydrocarbons in the atmosphere to produce other pollutants including photochemical oxidants. In the cities, motor vehicles are virtually the sole source of carbon monoxide, the main source of hydrocarbons and a large source of oxides of nitrogen. The relative volume of these pollutants emitted by various types of motor vehicles is shown in the following table which is based on readings taken in Sydney. The figures for hydrocarbons and oxides of nitrogen are for the period 6 a.m. to 9 a.m. and for carbon monoxide, 10 a.m. to 6 p.m.
Reported levels for the larger cities in Australia of carbon monoxide and oxidants, the 2 pollutants most commonly associated with motor vehicles, are up to four and five times the World Health Organisation’s long term goals. In the present economic climate the Australian Government appreciates the need to exercise restraint in determining its expenditure levels and patterns. In order that our overall level of expenditure on land transport systems will not place excessive pressures on the demand for resources, the Australian Government’s allocation for roads over the current 3 years will be $1,1 20m, some $225m less than that recommended by the Bureau of Roads.
As the Prime Minister stated at the recent Premiers Conference, we propose to press on with the urban public transport programs we have initiated. He reiterated the commitment the Treasurer (Mr Crean) made in the 1973 Budget Speech, that is, that our outlays in this field will increase rapidly in 1974-75 and beyond as this major new capital works program gets underway. This approach will enable the public transport systems to begin to reduce the difference in the services that they provide as compared with that available to the private motorist.
I would like to illustrate the base from which this program must commence. The last large scale investment in urban public transport was in the 1920s and 1930s, when Sydney and Melbourne undertook electrification of their suburban rail systems. Indeed much of current rolling stock dates from that period. From that time there was little investment in public transport beyond the ad hoc acquisition of rolling stock until work was recently commenced on the Eastern Suburbs railway and the Melbourne underground. In 1970-71, for example, capital expenditure on urban public transport was $30m of which one-third was for the Eastern Suburbs railway in Sydney and the Melbourne underground. Capital investment for those systems actually in operation represented the ‘massive ‘ investment of 2c per passenger journey.
Australia’s history of inadequacy of investment is reflected in the decline in the usage of public transport. The number of passenger journeys on government operated urban services declined from 1,122 million to 948 million, a fall of 16 per cent during the 10 year period from 1961-62 to 1970-71. In fact, as the urban population rose from 5.7 million to 7.5 million over that time the actual number of journeys per capita on government operated public transport declined by a staggering 35 per cent. I believe the rate of this decline in the usage of urban public transport is increasing. The number of passenger journeys fell a further 42 million in 1971-72. A decline in usage that was more than double the average rate of decline for the previous 10 years.
Public transport operators have been caught in a vicious circle-declining patronage; reducing revenue; and increasing losses. So fares are increased and/or services reduced. These actions cause more people to turn to alternative means of transport, that is their motor vehicles, thus further increasing the losses which operators sustain and aggravating the road problems thus further increasing congestion, pollution and the demand for parking in central business districts. Such a circle means that delays to this program, such as that which resulted from the action of the honourable senators of the Liberal and Country parties in forcing the recent election, are even more intolerable. Delays make the base, from which the program must build, even lower.
Whilst details of losses of the railway’s urban passenger operations are not available the sorry story of urban transport’s financial position is illustrated by the results of Government bus and tram operations. Take the period between 1961-62 and 1970-71, losses on these services in the capital cities rose from $8.2m to $19.1m, an increase of 133 per cent. Our initiative to improve the standard of city travel will have an impact upon the finances of the public transport systems. Under the terms of the Agreement the Australian Government will provide by way of non-repayable grants two-thirds of the cost of projects approved for assistance. That two-thirds of the capital costs is provided without the operating authority being required to meet interest charges means that some projects included in the scheme will be financially attractive to the operator. However, even with the twothirds contribution other projects will not improve the operating authority’s financial position.
The position I have outlined makes it all the more desirable that the States do not increase their charges. I am reminded of the events that followed the increase in fares in July 1971. Before that increase New South Wales had managed to halt the long term trend in the decline in the number of passenger journeys. In 1970-71 there was an increase in passenger journeys by rail of over 3 million on the number of passenger journeys in 1969-70. However following the increase of fares in 1971-72 the number of journeys fell by almost 25 million. As I previously noted the fall in usage of urban public transport in 1971-72 was more than double the average rate of decline over the previous 10 years. So by one action the New South Wales Government reversed a trend towards increasing patronage and greatly contributed to the steepest decline in usage of urban transport systems in over a decade. We cannot afford to have this experience repeated.
In the case of the overall State railway operations the Australian Government is aware that their annual losses are increasing rapidly. In 1970-71 these losses totalled $110m but by 1 972- 73 they had risen to $2 1 6m, a rise of almost 100 per cent in just 2 years. In addition a recent Press release by Mr Morris, the New South Wales Minister for Transport, forecast a loss of $ 126m for the New South Wales railways in 1 973- 74, an increase of almost 60 per cent in that year. The Australian Government is mindful of these problems and the need to upgrade our railways so that they can undertake their share of Australia’s transport task.
On 8 February 1973 the Prime Minister wrote to all State Premiers offering to enter into discussions on the transfer of responsibility for States’ railway systems. Four States, New South Wales, South Australia, Western Australia and Tasmania agreed to enter into discussions without commitment. We were disappointed that the Victorian and Queensland Governments are so insular that they were not even prepared to discuss this major initiative which could have achieved significant benefits for everyone in Australia. I should point out that the Prime Minister repeated this offer at the recent Premiers Conference where the Premiers were bemoaning their inability to meet the financial demands placed on them. Yet so far only the Tasmanian Government has made a positive offer to the Australian Government to transfer its rail system. This offer is at present under consideration. It is regrettable that the Western Australian Premier has, since the Premiers Conference, indicated that he is not prepared to consider further the possible transfer of that railway system. In doing so he has reverted to a 1 9th century approach to railways and has denied his state the benefit of joining other States in the 20th century. Also with regard to rail the Prime Minister and the South Australian Premier have recently signed an agreement to construct a new standard gauge railway from Crystal Brook to Adelaide. When the project, which is estimated to cost about $80m, is completed all mainland capital cities will be linked to Australia’s standard gauge rail system.
The Prime Minister and the Premier of South Australia have also signed an agreement to construct a new standard gauge railway from Tarcoola to Alice Springs. This new line will replace the old narrow gauge line from Marree to Mee Springs that is subject to disruptions from flooding in the Lake Eyre Basin. The new line will avoid the flood areas where possible and will provide a vastly improved service to the centre and north of Australia. The cost of the line is estimated at about $85 m and construction which will commence shortly will take about 5 years. The Agreement which this Bill will ratify has been produced as a result of extensive discussions at both ministerial and official levels and takes account of the interests and rights of all parties. One of the practical features of the Agreement is that it provides scope for discussion on any issues which might arise during its operation. Another major initiative contained in the Agreement is the provision for Australian Government representation on State Government bodies concerned with the forward planning and development of policies relating to urban transport. In accordance with the Agreement all States have now made offers to the Australian Government for representation on bodies concerned with the planning and policy of urban public transport.
It is through this participation that we will be able to facilitate the interchange of ideas between the States, a practice which has been sadly lacking in the past. We will ensure that there is no needless duplication of effort between States in urban transport and we will be exercising our responsibilities to the taxpayers of this country in the expenditure of their money. Through the representation on the State bodies we will also be able, as a complement to our broad urban strategies, to clearly advise the States on our objectives in urban transport and to have them taken into account in the development of their programs. For our own part we are aware that Australia does not lead the world in transportation. Consequently, in December 1973 the Minister for Transport accepted on behalf of the Australian Government associate membership of the European Conference of Ministers of Transport. This body, which discusses initiatives and problems in Transport, could be regarded in many ways as an international equivalent of the Australian Transport Advisory Council. Like ATAC the ECMT meets twice yearly and the Minister for Transport has recently returned from ECMT’s latest meeting in Vienna where extensive discussions were held on roads, road safety and railways. I have explained why the
Australian Government believes that there is a need for a program to improve urban public transport. I would now like to briefly describe the types of projects that will be initially undertaken.
In March 1973 the States were invited to submit a program for capital improvements over the 5 years to 1977-78. For the allocation of funds in 1973 the approach adopted by the Australian Government was to consider only those projects that were proposed to commence in 1973-74. This approach will be continued throughout the years of the program as it enables both the States and the Australian Government to maintain flexibility within the program. As our knowledge of urban transport services and the requirements of the travelling public improves programs will be altered to take account of these requirements. At present the proposals for projects to commence in 1974-75 are being considered by the Australian Government. In determining which projects would be supported for commencement m a particular year, the Australian Government has to consider the allocation of funds in its overall budgetary context, and the demands that projects will place on other industries, particularly in the field of construction.
One major deficiency throughout the urban systems is the age, almost antiquity, of rolling stock currently in use. Over 550 carriages of the Sydney urban passenger rail system are at least 45 years old and more than 500 of the Melbourne carriages are over 45 years old with some having been constructed in the last century. The full impact of past lack of investment can be realised when it is appreciated that half of the surburban passenger carriages in Sydney and Melbourne are over 45 years old. In addition, approximately half of the Melbourne tram fleet of almost 700 vehicles is over 40 years old.
The Australian Government allocated $ 17.26m, or 55% of its intended 1973-74 expenditure for the acquisition of new rolling stock. Under our first year’s allocation, the New South Wales Public Transport Commission will be able to purchase 92 new double-deck passenger rail cars. In Melbourne, as well as providing $3. 63m for the acquisition of 30 passenger rail carriages and $150,000 for new trams, we will provide $540,000 for the purchase of 30 buses, to replace the 20 year old vehicles presently in use. In Adelaide, Perth and Hobart the acquisition of new buses is a significant factor in their 1973-74 programs.
Another major project which we have selected for inclusion within the 1973-74 program is the quadruplication of the railway Une between
Granville and Penrith, estimated to cost $17.2m. This project will greatly improve services to the rapidly expanding western area of Sydney; and area where it should be noted that the Australian Government is taking a number of initiatives. Additional tracks will be constructed in Melbourne on various lines in order to relieve congestion on the rail system. When completed, this extra capacity will enable the number of express services operated to and from the outer surburban areas to be increased. In Adelaide and Brisbane we will be assisting with the electrification of urban rail links. There will be continuing benefits in terms of reduced operating costs and more efficient railway services arising from these efforts. Separate bus ways and bus only lanes in Sydney and Perth are included in the program and the facilities for waiting passengers will be improved in most cities. The allocation of Australian Government funds for those projects which have so far been selected for inclusion is as follows:
These are only the projects which were to commence 1973-74. As I stated previously consideration of the projects proposed for commencement in 1974-75 is underway at present. There is no doubt that our commitments will increase rapidly in ensuing years. Indeed before the end of this program in 1977-78 we may have new rapid transit systems under construction in one or more of our cities. During the recent overseas visit by the Minister for Transport he had discussions on the rapid transit system which is to be constructed in Nancy, France. This system, which is proposed to be operational by 1977, represents a new concept in urban travel and is one of many which may well have application to Australian cities. Before any project is approved by the Australian Government we need to be assured that all aspects of the proposal have been considered. All major projects are subjected to economic analysis by the Bureau of Transport Economics. The BTE evaluation of a project takes account of factors such as construction costs, operating costs maintenance savings and benefits accruing through reduced travel time. Social and environmental factors will also be given full consideration in selecting projects the Australian Government will support. Such factors as air pollution, noise reduction, social dislocation, employment opportunities and the generation of waste materials will all be considered in deciding whether particular projects should be approved. Similarly we will ensure that approved projects are compatible with longer range plans for urban and regional development.
During his overseas visits the Australian Minister for Transport has made a point of investigating urban transport systems in Europe, Canada, the United States and Japan. Having seen the efficiency of the more conventional services in Paris, Munich, Montreal and Philadelphia, having examined the operation of and ridden on the highly sophisticated BART system in San Francisco and having discussed the system to be built in Nancy the Minister for Transport is convinced that the Australian commuting public has been most shabbily treated in the past. With the injection of finance into public transport through this Agreement we will be able to rectify this wrong which was, to a large extent, perpetuated by the honourable senators of the Liberal and Country Parties by their failure to act whilst in government and then in their shabby approach in forcing the recent election which delayed the introduction of our programs. As we upgrade existing systems to an acceptable standard, we will be examining some of the more advanced technologies which are at present on the threshold of operational practicability. We are attracted to such transport forms as rapid and personal transit systems and to dial-a-bus or moving walkways. We are updating our knowledge of overseas developments and will continue to keep abreast of these and further developments to ensure that our urban transport systems once upgraded remain equal to the best in the world.
Our initiatives in the field of urban public transport are not restricted to the scope of this Bill. The Urban Public Transport (Research and Planning) Bill which is on the Notice Paper is complementary to the States Grants Bill and will cover the matter of financial assistance for the essential planning to enable the proper formulation of the assistance program. When the scheme to improve urban public transport was first announced in February 1973 a commitment was made to consider assistance for central city undergrounds and provincial centres. Whilst city undergrounds must be regarded as an integral part of the improvement of existing public transport systems, support could not be committed to these projects when the Minister for Transport announced the Australian Government’s initiative. I believe that it is essential that the Australian Government does not commit itself to providing assistance for these projects without adequate investigations. Evaluations such as the benefit-cost analysis undertaken by the BTE are even more necessary when the magnitude of the expenditure involved in these projects is considered. The evaluation must be undertaken if the Australian Government is to make effective use of available resources. A similar position exists with provincial centres. The 3 centres involved with populations over 100,000, Newcastle, Wollongong and Geelong, are becoming more and more integrated with Sydney and Melbourne respectively. I consider that we could no more ignore these centres than, say, ignore the public transport needs of the western areas of Sydney and Melbourne.
But again, large scale commitments must be preceded by comprehensive investigations. In this regard I am pleased to note that transportation studies of Newcastle and Wollongong and their links to Sydney have been commenced by the New South Wales Government. These studies will provide a basis for our consideration of the major initiatives required in these areas. I have previously referred to overseas experience and the significant technological developments that have occurred. One means by which it is proposed that these developments are introduced to the Australian people as soon as possible will be through the development of an Australian urban passenger train. The new rolling stock to be acquired for Sydney and Melbourne will be a significant improvement on the aged vehicles being replaced. It is for this reason that the Australian Government has agreed to support their acquisition as part of the 1973-74 program. They do not, however, appear to represent the best which modern technology has to offer.
One example of the factors which give rise to concern about the current designs is the question of acceleration and braking rates which have such an important influence on energy consumption and the schedule times of trains making frequent stops. Compare the acceleration rates of the new Sydney and Melbourne trains with the latest trains from overseas. They are:
With regard to passenger comfort and convenience, neither the Sydney nor the Melbourne new trains appears to represent an optimum solution. They are a mixture of good and not so good features in terms of modern technology. If we are to move to a standard basic design for railway passenger rolling stock it is possible to do better than either of these two current designs. I accept that local factors may prevent us from developing a completely uniform train design for all capital cities. These factors include ‘loading gauge’ differences, station and signal block lengths, performance requirements and passenger trip patterns of the various systems which may warrant development of differing capacities of vehicles. But the means of overcoming these difficulties lie in having one basic design and appropriate variations. It is for this reason that we are developing the Australian urban passenger train of which a prototype is expected to be operational in 1976.
Our approach to the development of the Australian urban passenger train will not be restricted to improvements to the hardware of the vehicle. We will also seek to have the improvements accompanied by time-table reliability, comfort, safety, co-ordination and business efficiency. Designers of the new train are examining the use of light-weight materials, improved acceleration and braking, automatic train control, reduction in noise and vibration, direct communication between riders, driver and co-ordinators, and automatic ticket vending. Systematic development of urban rail systems is seen to be a key factor to the success of the Australian urban passenger train project. I would like to refer to State participation in this project. Their close co-operation has been sought from the outset and in this regard, the Australian Government is very much aware that collectively the State railways have vast experience in the urban transport field. Through regular meetings with the States a forum for open and constructive discussion has been developed. This forum has been, and no doubt will continue to be, invaluable in the design and implementation stages of the whole project. I hasten to add the States have to date co-operated fully in the project. The Minister for Transport announced on 20 February 1974 that an Australian consultancy group had been appointed to provide technical leadership to the project. The feasibility of operating the Australian urban passenger train on new networks in metropolitan areas is also being examined.
Recently the Prime Minister wrote to the Premier of New South Wales proposing that the Australian Government construct a distinct rail system using the Australian urban passenger train based on Parramatta. This system would service the rapidly developing areas of Hoxton Park, Carlingford, Epping and Castle Hill. Such a system would reinforce the development of Parramatta as a growth centre. The Parramatta system would be constructed at no cost to the New South Wales Government. In addition, although New South Wales has been requested to operate the system, the Australian Government would meet any losses involved in its operation. The Premier has agreed to discuss this proposal and discussions have already commenced between Australian and State Government officials. I am hopeful that agreement will be quickly reached so that funds can be allocated for the commencement of work on the system in the 1974-75 financial year. There appears to be similar scope for the development of greater coordination in the approach to the design and standards of comfort and ride provided in Australia’s buses. Over the period of the program a large number of buses will be acquired and we are determined to see improvements in the standard of comfort for bus users. We would hope that it may not be long before buses are of high standard with features such as automatic transmission, more comfortable seating and possibly air conditioning.
I have described a number of the Australian Government’s initiatives to meet the pressing need to improve our cities’ public transport systems. I must state that the Australian Government’s goal is not for public transport to provide the only means of urban transportation. Such an approach would be as lopsided as that which has developed through the indifference of Governments before our eleciton in 1972. Rather our aim is the rational development of urban public transport. Each mode of transport operating in the urban areas should be encouraged to perform the tasks for which it is the most suitable, that is, in the case of public transport, to handle the higher density, regularly travelled routes. By expanding the role of public transport within the total urban transport system a significant contribution will be made to the quality of life in our cities. This Bill represents the first necessary step towards achieving the goal of increased usage of public transport. I commend the Bill to the Senate.
Debate (on motion by Senator Cotton) adjourned.
Bill received from the House of Representatives.
Motion (by Senator Cavanagh) proposed:
That so much of the Standing Orders be suspended as would prevent the Bill passing through all its stages without delay.
– I rise not to indicate opposition to this motion, which is a customary motion and which, unless there are unusual circumstances, the Opposition will always support. But I take this opportunity to say that there has developed in the Senate a practice which ought to be corrected, and it should be possible to correct it. At the time a message concerning a Bill is read and the motion for the suspension of Standing Orders is put, a copy of the Bill ought to be available to the Senate. There was a time when that was always the case.
My recollection is that when a Bill was introduced into the House of Representatives, as a matter of courtesy honourable senators received a copy of it for their own use in this chamber. But that has not been able to be done in recent times. The reason may be that the pressure of work is such that the attendants and the officers are not able to keep up with it. But I suggest it is only proper that before a motion of this character is voted upon, the particular Bill should be before the Senate. I rise only to make that point. I trust that something will be done to ensure that the practices of the past continue to be observed.
– Possibly we have become the victims of a habit. As Senator Greenwood can see, at the present time the attendants are passing around copies of the Bill. To my knowledge, copies have been available all day. They could have been distributed. It has been the practice to distribute them when the motion for the first reading of the Bill is moved. If there is some desire to have the practice changed, it could well be changed.
– An explanation has been given to me that it is the practice for copies of Bills to be distributed, but at the moment the system has broken down a little. I will see that in future copies are made available to honourable senators.
Question resolved in the affirmative
Bill (on the motion by Senator Cavanagh) read a first time
– I move:
This second reading speech has been delivered in another place and has been recorded in the Hansard of that place. Copies of this speech are being distributed to honourable senators. It is only 5 pages, but I seek leave to have it incorporated in Hansard.
-Is leave granted? There being no dissent, leave is granted. (The document read as follows)-
This Bill complements the States Grants (Urban Public Transport) Bill 1974 which was previously introduced into the Parliament. The Bill authorises expenditure of $lm on grants to the States for research and planning projects related to urban public transport. Under the terms of the Bill the Australian Government will meet two-thirds of the cost of approved studies. As honourable senators will appreciate this Bill relates to 1973-74. Because of the delays that have occurred this Bill must operate retrospectively. The Australian Government decided to continue with the allocation of these funds as the States have been made aware of our intention to support research and planning. Accordingly research and planning projects have been initiated by the States for which they, quite rightly, expected a two-thirds contribution of costs by the Australian Government. In order to honour our commitments 1 am now introducing this Bill.
The tasks to be undertaken under the research and planning scheme will assist both the State and Australian governments in determining their approach to improving urban public transport. It is our stated policy that no one transport mode should receive particular advantage over another and these funds should assist in achieving this end. We expect that there shall now be a far more thorough examination of alternative transport solutions to particular problems and that the States will use this money to evaluate the latest advances in transport technology with a view to the eventual implementation of these advances.
In the past there has been an unfortunate lack of research in this area. The Bureau of Roads and the Bureau of Transport Economics have been established by the Australian Government to undertake research into transport matters but these bodies have not exclusively concentrated upon research into urban transport matters. Their tasks have extended over the entire ambit of transport and consequently there is still much valuable research which needs to be undertaken in the field of urban transport. Of course some of their work has been in he field of urban public transport. In this regard we have tabled the Bureau of Transport Economics report on Consumer Preferences in Urban Rail Carriage Design. This survey was undertaken throughout Brisbane during May and June of last year with the co-operation of Queensland Railways. A similar bus passenger preference survey will shortly be commenced. As well as undertaking investigations into public transport the Bureau of Transport Economics has been investigating alternative fuel sources for the car. Studies into the use of liquid petroleum gas and electric vehicles have been undertaken and 1 expect shortly to receive the reports from the Director of the Bureau of Transport Economics.
However, we do not consider that the Bureaus of Roads and Transport Economics should be expected to be the only bodies undertaking research into public transport. It must be appreciated that the States with their operating expertise are in the best position to undertake a number of the investigations that should be made into urban public transport. Unfortunately the States have been prevented from doing this in the past because of a lack of finance. The funds will also enable the States to keep abreast of developments in such transport technologies as personal rapid transport and dial-a-bus which are presently on the threshold of operational practicability. As all Australians must be’ aware there are exciting developments proceeding overseas into new transport technologies. I am reminded of the work being undertaken to develope magnetic suspension systems. These include developments by MesserschmittBolkowBolhm, the developments of the French Aerotrain and Krauss-Maffei’s Transurban and Transrapid system.
During the brief overseas visit last month of the Minister for Transport (Mr Charles Jones) to attend the 39th session of the European Conference of Ministers of Transport he took the opportunity to inspect the progress made toward the construction of a similar system in Nancy, France. This system, which has been developed by the Otis Elevator Company, is expected to be carrying 110,000 people per day by 1977 and 165,000 people per day by 1985. Even within existing systems there is scope for exciting developments. In most major European cities, for example, special priority systems operate for the exclusive use of buses including, for example, road use arrangements which allow for buses to operate in exclusive lanes against the flow of traffic thus allowing a faster service to be provided. These systems enable public transport to come closer towards providing a level of service comparable with that provided by the private motor vehicle. Provision of planning funds will allow decisions to be made on a more rational basis than is presently the case, particularly in relation to the projects the States propose under the terms of the urban public transport assistance program.
Studies could be undertaken into fare structures. Such issues as the desirability of zoned fares, flat fare charges or a one fare structure for all modes could have a significant impact on the demand for public transport. The overall level of fares is another issue worthy of investigation. As it is generally accepted that urban public transport is not financially viable the level of fares should not reflect total costs but should also take into account such benefits to the community as reductions in road congestion and pollution from motor vehicles and the systems ready availability. Studies on the level of fares should also consider the charges on alternative transport modes through such factors as the cost and availability of off-street parking. Indeed we would be pleased to co-operate with local and State governments in studies to determine whether to restrict the availability of such parking within central business districts.
I have pointed to the inter-dependence of the various transport modes. The Australian Government is determined to rationalise its approach to developing policies for transport. This Bill allocates funds for only one year. Future research and planning funds for urban transport will be provided under closely co-ordinated and integrated arrangements in which funds for road research and planning and urban transport research and planning are made available within the one piece of legislation. This is a logical step from our initiative to combine all major transport responsibilities under one Minister and within one department. It is envisaged that investigations to be undertaken under this scheme will extend beyond the examination of hardware proposals. As I have outlined such matters as software systems, including the examination of management techniques, and studies of the relationship between modes will also be the subject of comprehensive studies. The long term results of this expenditure will be seen in improved service to the public, through the more rapid introduction of new technologies, and through the most efficient allocation of resources within the public transport sector. I commend the Bill to the Senate.
Debate (on motion by Senator Cotton) adjourned.
Bill received from the House of Representatives.
Standing Orders suspended.
Bill (on motion by Senator Wheeldon) read a first time.
Senator WHEELDON (Western Australia-
Minister for Repatriation and Compensation) (10.32)- I move-
That the Bill be now read a second time.
The Bill before the Senate is one of a number of Bills which together authorise implementation of a new Australian health insurance program. It contains the provisions necessary to suspend the operation of those provisions in the National Health Act which will cease to be required as the new Australian health insurance program comes into operation. It also contains provisions for the ultimate repeal of the redundant parts of the Act. The provisions in the Health Insurance Bill, which I have already introduced into the Senate, authorise the Health Insurance Commission to provide payments by way of medical benefits and for hospital services. Legislation will also be introduced to enable the Australian Government to authorise and supervise the operations of private health insurance business under the program.
The principal elements of this Bill are the cessation of Australian Government medical and hospital benefits and the cessation of fund medical and hospital benefits payments by registered health insurance organisations. This means that as medical and hospital payments commence to be made under the new program they will cease under the National Health Act. Insofar as Australian Government payments are concerned, clauses 5 and 9 authorise the cessation of Commonwealth medical benefits and payments under the pensioner medical service. These clauses will come into operation from the date that clause 10 of the Health Insurance Bill is proclaimed, from which date medical benefits will be payable under the Australian health insurance program in respect of services received or provided on or after that date.
Clause 1 1 authorises the cessation of Commonwealth hospital benefits. The date of operation of this clause is dependent on the date each State or Territory enters into the arrangements provided under clauses 30 and 32 of the Health Insurance Bill. Those clauses relate to Australian Government hospital payments under the new program. As arrangements may be entered into under these clauses by individual States and Territories at different times provision has been made for clause 1 1 of this Bill to become operative from varying dates. Clause 16 of the Bill provides for registered health insurance organisations to cease payments of fund medical and hospital benefits by requiring such organisations to cease carrying on health insurance business as registered medical benefits organisations or registered hospital benefits organisations under the National Health Act. The dates for cessation of these benefits and of the organisations operations are the same as those applying to the cessation of Commonwelth medical and hospital benefits which I outlined earlier.
Organisations ceasing operations under the National Health Act will be eligible to seek authorisation to conduct health insurance business under legislation which will be introduced to supervise private health insurance. In addition to the cessation of the payment of fund benefits, provision has also been made in clause 2 1 of the Bill to empower the Minister to terminate an organisation’s special account. This provision is necessary to increase administrative control during the period when the existing health insurance arrangements will be in the course of being terminated.
Honourable senators will be conscious of the need for provision to be made to ensure that contributors are able to continue to obtain satisfactory health insurance cover until the Australian health insurance program is introduced. In this context authority has been included in clause 1 9 of the Bill for the Minister to direct the Health Insurance Commission to establish a medical or a hospital benefits fund in a State or Territory when he is satisfied that the health insurance needs of the people cannot be otherwise satisfactorily met. To further protect the interests of contributors provision has been made for the Commission to pay a benefit to a contributor to a registered organisation where that organisation fails to pay a benefit which it is liable to pay under its rules. The Commission may take action to recover the amount of any such payment from the organisation.
The National Health Act was amended in 1972 to provide additional Australian Government nursing home benefits for patients in nursing homes with pensioner medical service entitlement and to introduce an equivalent fund benefit for persons insured with registered hospital benefits organisations. The Bill before the Senate provides for the additional Commonwealth payment now applying to pensioners to be extended to apply to all nursing home patients. Nursing home fund benefits will therefore no longer be necessary. This provision will become effective on a uniform date throughout Australia, that date being the first date upon which a State or Territory enters into the hospital arrangements provided under clauses 30 and 32 of the Health Insurance Bill. The remaining provisions in the Bill now before the Senate are consequential amendments of an administrative nature which flow from the principal provisions to which I have already referred.
The provisions in this Bill are designed to ensure that no one is deprived of any right or entitlement under the National Health Act during the transition to the Australian health insurance program. They are also designed to ensure that there will be no period of time during which medical or hospital services which attract benefits at present will not attract benefits or payments under either the National Health Act or the Health Insurance Bill. The provisions empowering repeal of parts of the Act will not be activated until all rights and entitlements under those parts of the Act have been fully realised. Mr President, I commend the Bill to the Senate.
Debate (on motion by Senator Rae) adjourned.
Bill received from the House of Representatives.
Standing Orders suspended.
Bill (on motion by Senator Wriedt) read a first time.
– I move:
By this Bill, and 2 others that I shall shortly introduce, it is proposed to impose a health insurance levy of 1.35 per cent of the taxable incomes, as determined for income tax purposes, of people residing in Australia. The Bills complement other measures designed to implement the Government’s universal health insurance scheme. Other basic features of the scheme are, of course, contained in legislation that has been before the Parliament on previous occasions. The levy proposed in the present Bills was discussed in the White Paper on the health insurance program published in November 1973, which was preceded by the report of the Health Insurance Planning Committee.
Introduction of the levy is timed to coincide with the coming into operation of the main health insurance legislation. At this stage we would hope to have that legislation effective as from 1 July 1975. However, in the event of some unforeseen administrative complexities which may require a slightly later introductory date, the Bills provide for the levy to be payable on taxable income of the 1975-76 income year, but also make provision for the annual rate to be reduced should the scheme not become operative until a little later during that year. In that event, it is intended that the rate applied to 1975-76 taxable incomes will be a proportionate part of the annual rate of 1.35 per cent, determined on a time basis. The levy of 1.35 per cent of taxable income will not apply to all taxpayers. At the upper end of the income scale, and on the assumption that the levy will apply for the whole of 1975-76, the maximum amount of levy payable by anyone will be $150. If the commencement date for the levy were not 1 July 1975 but, say, 1 October 1975, then the maximum amount payable for that year would be $ 1 12.50. For low income taxpayers there are provisions to the effect that a person whose taxable income is less than the minimum subject to income tax- now $ 1 ,04 1 -is not liable for the levy.
There are also relieving provisions in respect of people maintaining dependants. These will apply to anyone who is entitled for a particular year of income to concessional deductions for maintenance of dependants of an amount of $100 or more. In these cases the levy will not be payable where a person’s taxable income is not more than an amount related to the level of the minimum wage and calculated by application of the formula devised by the Planning Committee and explained in its report at pages 44 to 46. If the levy were to be imposed for 1974-75, the threshold for its imposition would in these cases be $2,575 and the legislation specifies this amount as the level below which the levy will not be payable by people with dependants. Provision is also made, however, for the amount to be increased above $2,575 in the light of changes in wage levels that occur before 1 July 1975. Another relieving provision related to income levels of particular classes of people concerns aged people. An aged person exempt from income tax by reason of the special transitional tax rebate will also be exempt from health levy. The actual levy-free point for 1975-76 will depend on the amount of the age rebate allowed for income tax purposes in that year. The general principle is, however, that whatever the level of the income tax rebate in 1975-76, an aged person who is exempt from income tax on account of it will also be exempt from health levy.
Provision is also being made to give relief from the levy to certain classes of repatriation beneficiaries. The broad principle is that a repatriation beneficiary who is entitled under repatriation arrangements to full medical treatment for himself for all medical conditions, whether or not warcaused, but who has no dependants, will be completely free from payment of levy. If the beneficiary is entitled to full cover for himself, but has a wife or children, he will be entitled to relief from one-half of the levy that would otherwise be payable. The question as to whether a case for relief may be made for other classes of people in situations broadly corresponding with those of repatriation beneficiaries is being examined. We are considering to what extent, if any, relief ought to go beyond the ranks of repatriation beneficiaries, and the legislation contains a provision authorising the making or regulations to confer such relief as it may be found appropriate to give. In this context we are giving special attention to pensioners who have an entitlement to free medical attention under the pensioner medical scheme and members of the armed forces.
A fundamental objective of the legislation is to integrate collecton of the levy with the collection of income tax. This has distinct administrative advantages which I am sure I need not labour. Suffice it to say that it is the most economical and sensible course to follow. It does, however, require a number of provisions of a technical kind. Much of what is in the Bills is concerned with these technicalities and explanations of the various provisions are contained in the explanatory memorandum I have arranged for honourable senators to receive. I should mention, however, that while the levy will be administered and collected under the income tax system and payasyouearn deductions from salaries and wages will be increased in 1975-76 to take account of it, provisions in the legislaton require a separate identification of the amount of a taxpayer’s liability that represents health insurance levy. Thus, for example, the amount payable as the levy will be shown separately on pay slips, group certificates and taxation notices of assessment. The various provisions of the Bill, including the technical parts that provide for levy to be payable on certain income derived by trustees and for people living in the external Territories to be exempt, are, as I have already indicated, explained in a memorandum that is being made available to honourable senators. In these circumstances, I think I need say no more at this stage about particular features of the Bills. I commend this Bill- the Health Insurance Levy Assessment Bill- to the Senate.
Debate (on motion by Senator Rae) adjourned.
Bill received from the House of Representatives.
Standing Orders suspended.
Bill (on motion by Senator Wriedt) read a first time.
Senator WRIEDT (Tasmania- Minister for
Agriculture) ( 10.49)- I move:
In introducing the Health Insurance Levy Assessment Bill 1974 I outlined basic features of the proposed health insurance levy. These are contained partly in that Bill and partly in this Bill- the Health Insurance Levy Bill 1974. This Bill provides the rate of the levy- basically 1.35 per cent of taxable income. It also contains rules for fixing the maximum amount of levy payable and the income points below which some groups of people will not be called on to pay any amount of levy. Explanations of each clause of the Bill are contained in the explanatory memorandum and I commend the Bill to the Senate.
Debate (on motion by Senator Guilfoyle) adjourned.
Subsidy on Petrol Tax
Motion (by Senator Douglas McClelland) proposed:
That the Senate do now adjourn.
-The first matter I want to mention is that in the debate on the Financial Corporations Bill 1974 reference was made to an explanatory memorandum having been circulated. I think it has not been circulated and I hope the omission will be repaired. The second matter to which I wish to refer is what seems to me a very diabolical blow at the country people of Australia in the recent announcement by the Government of the withdrawal of the subsidy on petrol tax to those in outlying areas in Australia. That, coming at the same time or in the same bracket as an attempt to impose higher telephone and postal rates upon country people who bear most of them by reason of extra charges, is a very important imposition on outlying residents.
It is a pity that Senator Wriedt, the Minister for Agriculture, has just left the chamber because I was about to refer to the outstanding paragraph in the report that his working party prepared on agricultural policy for his guidance as Minister, that is to say, the green paper. It is therein recorded that since 1963 the average income for the farmer has been reducing at the rate- I think it is-of $200 a year from a beginning point of $3,600, while the incomes of all other sections of the community have been increasing. This is a withdrawal of the petrol tax concession which we extended about 7 years ago to all persons resident beyond a certain radius from the capital cities to prevent high rises in petrol prices from being passed on to the outlying residents of Australia. It was about that time that the Opposition, then in government, made the phenomenal beneficial arrangements with the Broken Hill Pty Co. Ltd whereby the general price of petrol has since been contained so that Australia is getting on the whole if not the cheapest then the second cheapest petrol in the world.
I believe that today is a day of decision and indecision. I am raising this matter only so that the Government can inform me what the Australian Labor Party policy is on the question of whether or not these outlying residents are to be forced by a withdrawal of a subsidy to pay in some instances an increase of up to 33c a gallon. It is a curious thing that I hear that the Government has been confirmed in its original iniquitous intention by a meagre vote of three within a closed Caucus meeting tonight -
– Where did you get that information, Senator?
-I do not know where I got that information but it troubles me that I might go to sleep before I get it confirmed or receive an undertaking that it will be recommitted to the Caucus. If this Government ever wished to demonstrate that it purpose is to destroy and damage the outlying resident, who is probably working up till this hour to earn a meagre living for himself, it has done so by this announcement. It cannot even continue the subsidy that we granted to residents whose distance from the populous centres requires them to be more than usually dependent upon motor transport to cover the miles that separate them from the centres.
I think that Parliament ought to have an authoritative statement on whether the Government has any policy on this proposition. Whether it depends upon a majority of three in Caucus, and then as a result of the binding vote of Caucus on a mere majority of three in another place, and then when it comes here on an even lesser number which may vary, I still hope that we will be joined by those people who have a closer interest and knowledge of the outlying communities than even I have to determine whether the Government has a policy on this question and what is its position.
– I was informed today that last evening the honourable member for Gippsland (Mr Nixon) in speaking on the adjournment debate in another place eventually got around to directing his remarks to my position in respect of a number of things. This is reported on page 826 of the House of Representatives Hansard. I want to deal with those remarks in detail because the information I received today disturbed me and I take umbrage at what was said. The honourable member for Gippsland evidently saw fit to use the secretariat of the Australian Country Party to inform the Press of certain matters which certainly call into question my integrity which I propose to defend this evening. In doing so I want to refer to page 826 of the House of Representatives Hansard where Mr Nixon is reported as saying:
Having dealt out short shrift to the honourable member for Hunter 1 turn to another matter of more importance to my constituents in Gippsland. I refer to the recent visit by Senator Brown as the representative of the Minister for Aboriginal Affairs (Senator Cavanagh) to Orbost, Lake Tyers, Nowa Nowa and Bairnsdale.
He could have added Cann River. He continued:
The purported reason for the visit was to inspect the flood situation. I understand that the honourable senator made a submission about the floods. 1 hope he has done so, but nothing has come out of it as yet,
I stop there for a moment. My commission was twofold. In the first instance I was, on behalf of the Minister for Aboriginal Affairs (Senator Cavanagh), to carry out an on the spot in-depth examination of conditions that the Aborigines in that region were experiencing in relation to housing, education, health, and work opportunities among other things. That was my prime obligation. My second purpose was while in that region- this was the last portion of Victoria to be seriously affected by the floods in the previous weeks and months- to submit a report to the Prime Minister (Mr Whitlam) on the extent of the flood damage.
Dealing with the question of the flood damage first and foremost, I point out that on visiting such places as Wangaratta, Shepparton, Numurkah, Nathalia and the Swan Hill and Orbost regions and meeting the various shire and city engineers and secretaries, I found that although submissions had been made to the Premier’s Department, which is the appropriate place to send these submissions, the Premier of Victoria, Mr Hamer, had preceded me in some areas and had intimated that the Commonwealth was responsible for the delay in meeting any of the claims that were being made, particularly by the shire and city councils in these regions.
I want to point out briefly that the Prime Minister (Mr Whitlam) issued a Press statement in the following terms on 18 May 1974:
The Prime Minister, Mr E. G. Whitlam, announced today that as a result of reports of extensive flooding in Victoria he had urgently telegramed Mr Hamer offering fiancial assistane for the alleviation of personal distress and repair of damage. Mr Whitlam also announced that the Australian defence services had been requested to provide whatever assistance could be given to alleviate the effects of the flood.
I am saddened and distressed to hear that a soldier has drowned whilst engaged on flood relief operations. Such tragic accidents compound the already grave distress caused by floods’. Mr Whitlam said.
That was in the Seymour area. The Press statement went on:
Mr Whitlam went on to say that in a letter to all Premiers dated 27 February he had outlined the arrangements for financial assistance from the Australian Government to the States in the event of natural disaster. Mr Whitlam said that the offer which he made in that letter applied in the case of the current Victorian floods. The offer to Victoria includes financial assistance, on a dollar for dollar basis, for the immediate relief of personal hardship and distress. As well, under these arrangements the Australian Government meets the whole cost -
I repeat ‘the whole cost’- of approved rehabilitation and restoration measures in Victoria above the base cost of S3. 5m.
I found out that the members of the shire and city councils in the areas I visited which had been flood affected were not aware that while the Commonwealth Government had given the undertaking to provide relief, the States had insisted on administering the arrangements of the scheme. I have here a copy of the application form which must be forwarded to the Flood Relief Committee via the Premier’s Department. The forum contains questions on everything except, I think, the colour of your eyes. A decision is made in due course by that authority. I have reports form various shires and city councilsfor instance, Wangaratta- that I visited as far back as 23 May. Interestingly enough, while I had that document in my possession- I informed the Prime Minister of its contents- I read the following article in the Melbourne ‘Sun’ of 13 July 1974- it was buried on page 17- which was headed: ‘MPs look at flooding:
The Parliamentary Public Works Committee will visit northern Victoria next week as part of its inquiry into serious flooding several weeks ago.
The committee will take evidence at Echuca on Tuesday, Shepparton on Wednesday and Wangaratta on Thursday.
The committee chairman Mr Amos (Labor, Morwell), said the committee would seek evidence from all interested parties.
The only reason I refer to that newspaper article is to point up the suggestion by Mr Nixon that he hoped that subsequent to my report there would be no undue delay in providing some relief for those flood affected areas. The decision does not rest with the Commonwealth Government; it rests fairly and squarely on the shoulders of the State Government of Victoria. The State Government insisted for obvious reasonsbecause they are State’s righters- that it would administer the scheme and allocate the moneys that the Commonwealth had provided for flood relief. Having said that, I want to refer again to Mr Nixon’s comments in respect to my visit to that region. I read again from page 826 of Hansard of 30 July 1 974 where Mr Nixon is recorded as saying:
The previous Minister for Aboriginal Affairs undertook that trip -
That is the trip that I undertook - as did his predecessor, the honourable member for Mackellar (Mr Wentworth). There is one difference about the visit of the honourable member for Mackellar. Everything that he said that he would do he did.
If the honourable member for Mackellar did what he said he would do, I cannot imagine what the conditions of the Aborigines in that region must have been like prior to his visit. I have been there and reported upon the conditions and I am prepared to table the report. I have the authority of the Minister to do that. The report shows that the Aborigines in that region, generally speaking, are suffering from deplorable conditions in terms of housing, education, employment opportunities and the provision of health services. I know that to say the least politics can be a little rough, but the gentleman went on to say, as recorded at page 827 of Hansard:
Senator Brown visited the area a couple of weeks ago and it is to that visit that I want to draw the attention of the House. Senator Brown followed the same course as that taken by the Minister for the Capital Territory, who is now at the table. Senator Brown was also alarmed at the state of the housing in the area.
I was alarmed not only at the state of housing in the area-
I hope that on this occasion something will be done about it. At the meeting at Bairnsvale about thirty to forty people attended including the local newspaper representative, who wrote a story about it. He will bear witness to whatI am about to recount to the House. During the course of a long tirade lasting about forty or fifty minutes Senator Brown directed his remarks mostly to the alleged failure of the previous Government to do anything for Aborigines.
I shall deal with first things first. The 40 minutes I was alleged to speak for excluding the exaggeration and distortion of ‘tirade’, was actually about 10 or15 minutes. I found that I had to endeavour to establish communication and confidence with the Aboriginal people. I believe that I proved earlier during the course of that visit that the shorter the period I spoke and the longer opportunity I gave for questions the more fruitful was it for my own edification and from the point of view of the Aborigines. However, the honourable member for Gippsland went on to say:
When the honourable senator finished his attack on the previous government -
And I interpolate that there was every justification for attack on the previous government-
Mr Phil Pepper, a well respected and well known Aboriginal and a great friend of mine, got to his feet and started to rebut some of the points raised by Senator Brown. He pointed out that Senator Brown had been incorrect about when Aborigines got the vote. Senator Brown had said that that if it had not been for Labor Party pressure Aborigines would not have had the vote a few years ago when they did receive it.
I am sorry that I have to quote all of this. The honourable member stated further:
Phil Pepper said at the meeting that his father had voted in 1908. Senator Brown replied by saying: ‘Look, if Aborigines had a vote in 1908 I will give $1,000 to any charity you like to name. If I am wrong, you give $100.’ Phil Pepper agreed with this. He thought it was fair enough. He rang me from Bairnsdale the next morning and I said: ‘I am sure they had a vote a long time ago but I am not sure of the year. I will check up.’ By the time I got through to the Department, Phil Pepper had driven all the way to Orbost-60 miles -
He must have had an awfully slow car to do 60 miles in a day- -to see me about this serious matter.
In 1855 Aborigines got the vote in Victoria so Senator Brown was a little bit out.
He then went on to talk about what was happening on that Friday and to the fact that he sent me a telegram. Incidentally, I received the telegram. I quote the honourable member again. He said:
I think that his colleagues in the Labor Party ought to know and Senator Brown ought to know that we expect him to pay up. 1 sent him this telegram.
I want to quote the telegram the honourable gentleman read into Hansard because it is interesting. I have here a telegram that in fact I received. The telegram that Mr Nixon quotes as having sent to me, as recorded at page 827 of the House of Representatives Hansard of last evening, is as follows:
Have confirmed that Aborigines have had the vote since 1855 in the State of Victoria and logically from 1901 for Federal elections. Mr Phil Pepper has nominated the Save the Children Nowa Nowa Fund -
That is the local Aboriginal fund- to be the recipient of your thousand dollars offered at your public meeting in Bairnsdale on Tuesday night and witnessed by the local newspaper. I would urge that you expedite payment of this matter otherwise your integrity and honesty as a senator for Victoria will be under challenge.
I repeat that that is the telegram that Mr Nixon read into the Hansard of last evening. This is in fact the telegram that I received:
Have confirmed that Aborigines have been voting in State and Federal elections since 1855. Mr Pepper has nominated the Save the Children Fund at Nowa Nowa to receive the $1,000 you publicly offered at Bairnsdale meeting on 25 June and witnessed by local newspaper. Would appreciate your urgent attention to this matter as it involves a question of your personal honesty and integrity with the Aborigines of East Gippsland.
Hon. Peter Nixon MP
– Order! I very much regret having to interrupt the honourable senator’s speech, but I think it only fair to inform the Senate that no government cars will be available to senators after 11.30 p.m. Senators are advised that after that time they will be obliged to wait some time or else make their own arrangements for taxi transport to their places of residence. No official transport will be available after 11.30 p.m.
– I acknowledge the statement that you have made, Mr President, and regret that I have to pursue the course that I have determined. This matter, I repeat, was released to the Press this afternoon, I understand under the auspices of the Federal Secretariat of the Australian Country Party. Therefore, it is incumbent upon me to answer the charge. Before you made your statement, Mr President, I was quoting the telegram that was read into the Hansard record and also the telegram that I received. They are quite different.
I now refer to a newspaper report. There was only one newspaper report in the region. This has been checked out by the Parliamentary Library. The report appeared on the front page of the Bairnsdale ‘Advertiser’ of 27 June 1974. It certainly contains no reference to any comment by me about where or when Aborigines did not receive a vote in Victoria and/or Australia. However, it is true that I did make some comments and did say that the most we could hope to do in respect of Aborigines today was to make some recompense for what had been done to them by our forebears. Among other things, I said that they had been brutalised and that nobody could challenge that that was so. I went on to say that it was not until recent years- I understand it was 1971- that they were in fact counted in the census for the purpose of determining the population of Australia. It is true that in 1967 there was an alteration to the Constitution by way of a referendum and that some assessment was made at or about that time or prior to that time, but in fact they were not acknowledged as people for the purpose of determining the total population of Australia until the 197 1 census.
The comments I was making in respect of Aborigines were not related only to Aborigines in Victoria. I will deal with that aspect presently. I was speaking of Aborigines in the sense of the Aborigines of Australia and relating my comments to a universal adult franchise. Not only were the Aborigines dispossessed of the adult franchise throughout Australia and as between States but so also were Europeans. I do not propose to go into detail and, if it is so wished, I am happy to table a document prepared by the Education and Welfare Group of the Legislative Research Service of the Parliamentary Library relating to the voting rights of Aborigines in State and Federal elections. With respect to Victoria the document points out that since the inception of the Constitution of the State of Victoria in 1855 Aborigines have been entitled to enrol and vote in that State although neither enrolment nor voting became compulsory until 1962. 1 will not weary honourable senators with particulars concerning all the other States, but I asked for a summary of the voting rights in each State, including Victoria, and the rights of Aborigines with respect to the franchise for national elections. I propose to read this information into the record. The document states:
REQUEST: Further information on Voting Rights for Aborigines.
The first Victorian Parliament was elected under the provisions of the Victorian Constitution Act, 1855. The Constitution in outlining the qualifications of electors made no distinctions on the grounds of race but the franchise was restricted. To qualify as a voter for the Legislative Council a man had to be 2 1 or over and amongst other qualifications either possess freehold property to the value of£ 1 , 000 or the annual value of £ 1 00. A voter for the Assembly had to- be 2 1 years of age, and male possess freehold property to the value of £50 or the annual value of £5, or occupy a leasehold worth £10 per annum, or be a householder of the annual value of £ 1 0, or be in legal occupation of Crown lands for a period of 1 2 months in consideration of any payment to the public revenue, or be in receipt of an annual salary of £100.
That was a lot of money in those days.
These qualifications left an estimated¼ million diggers on the gold fields unrepresented. Few if any Aborigines would have been able to meet the qualifications of an elector.
However, in 1856 property qualifications were abolished, and all men over 2 1 were given the right to vote in elections for the Assembly although requirements regarding residential qualifications were retained.
That information deals with Victoria. Still dealing with Victoria, the paper states:
According to the Victorian Year Book, 1973, this right (of men over 2 1 to vote in Assembly elections) was- effectively restricted by an Act of 1 863 which provided for automatic electoral enrolment of ratepayers and qualification of others (to vote) only by payment of a fee and strict residential requirements.’
The restrictive property qualifications for electors of the Legislative Council were eased in 1 869 and in 1 88 1 such that in 1881 the income or property qualifications necessary to enable a man to vote in Legislative Council elections were: freehold of annual rateable value of £ 10, or a leasehold originally created for not less than 5 years, or an occupying tenancy of an annual value of £25.
These provisions would have excluded many of the less wealthy sections of the population of Victoria (including many Aborigines) from entitlement to vote in Council elections. There were further reductions of these qualifications in 1888 but it was not until 1950 that full adult suffrage (i.e. unqualified voting right for all persons over 21) was introduced for Legislative Council elections.
I again repeat that I was talking about adult franchise for national elections. The only way in which one as an Aboriginal or, for that matter, as a European had an entitlement to vote in a national election was to qualify as an elector ina particular State. I shall refer to New South Wales. This information is worth recording because it will be seen how the Aborigines have been dispossessed of an entitlement which others enjoy. I now have a summary which has been supplied by the Library and it states:
New South Wales: Before 1926 most Aborigines were, in effect, debarred from voting in State elections. Since 1 926 all Aborigines in New South Wales have been entitled to be enrolled and to vote in State elections.
The figures for Queensland are interesting. The summary continues:
Queensland: Before 1965 most Aborigines and Islanders were debarred from voting in State elections. Since 1965 Aborigines and Islanders have been able to vote for members of the Legislative Assembly in Queensland.
Western Australia: Before 1962 Aborigines with more than 25 per cent Aboriginal blood could not vote unless (s)he held a certificate of citizenship. Since 1962 Aborigines in Western Australia have had the same voting rights at State Elections as other residents of Western Australia.
South Australia: Aborigines have had the same voting privileges as other British subjects, provided that they are domiciled in a particular sub-division for one month as is required of other electors. Enrolment is not compulsory (1 ).
Northern Territory: Before 1962 most Aborigines in the Northern Territory were debarred from voting in elections in the Territory. Since 1962 all Aborigines have had the same voting rights as British subjects, except that enrolment and voting is not compulsory.
The second last reference is to Victoria again and the summary states:
Although Aborigines were (under the Victorian Constitution of 1855) not excluded from voting in Council and Assembly elections, certain restrictions (requiring electors to be owners, lessees or occupying tenants of property of certain stated values) would have debarred many sections of the population including between 80,000-250,000 gold diggers and presumably many Aborigines, from the right to vote in State elections.
The first Federal elections were in 1901. Before 1962 only Aborigines entitled to vote in State elections and Aborigines who had served or were serving in the defence forces could vote in Federal elections. Since 1962 all Aborigines and Islanders in Australia have had the right to vote in Federal elections. Enrolment and voting is not compulsory. I regret that I might have imposed on the Senate to some extent but I do not take kindly to the suggestions that have been made by Mr Nixon, particularly when I look at his record.
The Australian Parliamentary Handbook of 1973 discloses that Mr Nixon was elected to the House of Representatives for the electorate of Gippsland, in Victoria, in 1961 and that he held a ministerial appointment from 16 October 1967. I think that he was a Minister when the former Government went out of office in 1972. It is interesting to note that Mr Nixon has been the member for that area for 13 years and that for 1 1 of those years he was a member of a government. Yet some 10 years ago in a location, namely Nowa Nowa, which is almost in the heart of his electorate a group of people were so depressed and concerned by the state in which the young Aboriginal children were living that they applied to the London office of the Save the Children Fund to seek approval to build a kindergarten to provide some facilities for the little ones in that region. Mr Nixon may have said something on this matter but I cannot recall having heard or read it. I cannot recall having heard Mr Nixon raise his voice, as I imagine he should have, particularly having regard to the fact that he was a member of a Party that was in government for 23 years, for 1 1 of which he was in the Parliament, and would have provided some assistance to the people in this region.
There is much more that can be said about this matter. Mr Nixon referred to a Mr Ray Frawley who was a reporter at the meeting in question. There was no reference in the newspaper report to my saying anything about where or when Aborigines received a vote. I did make reference to the fact that I believed our forebears had bru.talised the Aboriginal people, that the most we could hope to do was to recompense them in some way for what had been done to them in the past. I made reference to the fact that Aborigines had not even been looked upon as being human beings to be counted in the total population of Victoria until more recent years, and I referred to the fact that their voting rights were only of recent years in terms of adult franchise, particularly in regard to national elections. I believe those facts that I have related- I am sorry that they have sounded tedious to honourable senatorsproved conclusively that what I have said is perfectly correct. Therefore, amongst other things, I repudiate the suggestion made by Mr Nixon based on second-hand information. I do not know Mr Pepper. He is entitled to his interpretation. I believe I recall, and I know what I said and meant.
I wish to raise only one other matter, namely, that Senator Brown visited the area using a Commonwealth car. It is true that I did. I did so because I was representing the Minister. Mr Nixon said, among other things, that he could not recall that as a backbencher he was entitled to a Commonwealth car, I think, and staff to accompany him. It is true that I did have staff with me. I had my secretary with me. I assure honourable senators that the cost of my secretary’s expenses was not borne by the Commonwealth. It was borne by myself. I paid for her accommodation and the normal meals that one would have whilst in the course of an inspection of this kind. The principal reason for having her with me was she is a very competent secretary, is able to take notes and would have a first hand knowledge of the matter. She was with me at the point at which we were examining in detail and depth matters to which I have referred. We had an accurate record of precisely what was seen and I could accurately report in detail and depth to the Minister, as I have. I report that I am quite happy to table this report if the Senate grants me leave to do so.
– I intend to keep honourable senators for only several minutes. I join with Senator Wright in deprecating the move by the Government which was foreshadowed at the Premiers Conference on 7 June by the Prime Minister (Mr Whitlam). He said that the Government would discontinue the subsidy on petroleum products at places where otherwise the prices would be inordinately high. I did not hear Senator Wright’s earlier remarks; I heard his latter remarks. I am not sure whether he, through long custom, knows that these matters are the subject of papers that are laid on the table. But certainly an amendment to the Act in 1973 was followed through by the AttorneyGeneral (Senator Murphy) on 2 April of this year when he laid on the table the whole new Schedule of subsidy prices for petroleum products in Australia. This Schedule is subject to the amendments which were made in 1973, and which provide that the Schedule is treated as a regulation and is subject to disallowance in this House.
Is that what Senator Wright said? I am not sure. I do not want to get crossed lines with the honourable senator again. I think our purposes are in a similar vein. I am not trying to pre-empt him because I do not know what he said earlier. All I am saying is that I will move for the disallowance of this Schedule, if Senator Wright has not already stated that he will do so. If he has I will support him. I want Senator Wright to know that I am not trying to pre-empt him. I have been working on this matter since I heard, shortly after 8 o’clock this evening, that there had been a vote in Caucus of 45 to 42 in favour of continuing what I believe is a disastrous policy that will be quite hard in its impact on people who live in decentralised areas in Australia. As some $28m in a full year or something like $500,000 a week is involved in this subsidy on petroleum products in Australia, I believe I should make it known tonight to honourable senators that I will move for the disallowance of the Schedule if Senator Wright has not pre-empted me in some remark I did not hear.
-No, I did not.
– In that case, I will move for the disallowance if given the opportunity in the Senate. There was some confusion abroad as to whether this Schedule was subject to disallowance. I want to place on record that, following an amendment that was made last year, these Schedules are subject to such action. Under sections 48 and 49 of the Acts Interpretation Act, with exclusions which do not affect this particular case they are subject to disallowance as normal regulations are. For many reasons- I would only bore the House if I were to state them in detail tonight- I would certainly support, and if necessary move, such a disallowance motion when the time comes.
– I believe that the remarks made by Senator Wright and Senator Hall will be effectively replied to by Senator Wriedt who knows the country areas and has been involved in this matter for some time. I am interested in the points that have been raised by Senator Brown. I think he has justified his case. I am not an arbitrator who has to decide whether Senator Brown owes $1,000 or whether Mr Pepper owes $ 100.
– Or whether Mr Nixon is an agent -
-Or whether the honourable member for Gippsland (Mr Nixon) had some ulterior motive in wasting the time of the House of Representatives last evening by referring to this matter, which was a bet between 2 individuals. It shows the bankruptcy of the politics of that particular individual. He comes into the National Parliament and recites what someone said at a meeting about a matter of $1,000 or $100. Mr Nixon made disparaging remarks about the visit, whether it was justified and whether conditions were too elaborate for the visit. Senator Brown went down, I think at my request, as a result of various reports that had been received. The field work that is done by members of the National Aboriginal Consultative Committee is of great advantage. They report to my office or to the Department of Aboriginal Affairs on the conditions in a particular area. Mrs Skuta, who is very active in the Gippsland area for which she is the National Aboriginal Consultative Committee member, sent me a frightening report about the conditions of Aborigines in the area, mostly in regard to health, housing and welfare.
When I submitted the report to Mr Worthy, the Director of Aboriginal Affairs in Victoria, I received the reply that it seemed there was no foundation for Mrs Skuta ‘s charges. In fact, he told me that he would not even reply to some of them; he did not think they were worth replying to. That State has the smallest population of Aborigines of all the mainland States. Last year the Commonwealth, through my Department, made grants to the Victorian Government for the benefit of Aborigines. We gave $557,000 for housing, $84,000 for health - (Quorum formed.)
-Before I return to the subject of the treatment of Aborigines in Victoria I want to raise a couple of points. Is it right for honourable senators to come in the door when attention has been drawn to the state of the house and then, having received a nod from someone else, to rush out again? This was done on another occasion. Senator Wright- this great custodian of morals, principles, justice and fair play, the upholder of the dignity of the Senate, the great statesman of Australia, the great man from the Island State who comes over here in defence of all that is fair and free- makes accusations, many of which are false, and will not permit a reply to be given to them. Senator Wright will not permit a reply to be given without interruption. He takes every opportunity and every advantage to see that no reply is given to the false accusations that have been made. He tries to ensure that what has been recorded in Hansard cannot be repudiated. I am glad to see that at least one member of the Liberal Party had the decency and the honesty to see that justice was done to both sides. The denial of justicethat is what Senator Wright attempted to achieve tonight- is not typical of the profession which he follows.
– It is a disgrace to the profession.
-It is a disgrace to the profession. I do not know what the Law Society would say if it was reported. However, I return to the more essential matters that we are considering. Last year in Aboriginal assistance the Australian Government gave to Victoria $557,000 for housing, $84,000 for health, more than $250,000 for education and $32,000 for unemployment purposes as special works grants. I repeat that Victoria has the smallest Aboriginal population of any State in Australia. I interpolate that I hope that Senator Greenwood has received the information that it is now all right to come into the Senate.
We received one report of the poor housing conditions that existed for Mrs Skuta. This was referred to Mr Worthy, the Director of the Ministry of Aboriginal Affairs in Melbourne. He denied the accusation. Through the tabling in the Victorian Legislative Assembly on 6 March 1974 of a report, he indicated that the Victorian Ministry considered that 5 families were inadequately housed and that it had 10 houses unoccupied and in need of repair in this area. That is the appreciation by the Victorian Ministry of Aboriginal Affairs of the situation in this area. This report was in complete contradiction of the information that I received.
I asked Senator Brown whether he would go to the area and make an investigation so that we could obtain findings as to the situation. An officer of my Department had been sent to this area on 4 and 5 April 1974 to promote the arrangements that were available with respect to finance for house building and purchase. That officer reported that many houses acquired by the Victorian Ministry in the last few years were unsatisfactory from the point of view of the residents. A number of the houses had structural faults that must have been apparent at the time of purchase and most required substantial renovation. Many of the houses were isolated from schools, doctors, telephones and transport.
Senator Brown visited this area and made an inspection. I think that we owe him some gratitude. The report which he has offered to table tonight would show that the findings of his inquiry, which was a most thorough investigation, support the remarks or the complaints of the National Aboriginal Consultative Committee member who represents the area and show that some need exists for something to be done in the Gippsland area.
I take umbrage at what Mr Nixon said when, in his remarks, Mr Nixon asserted that, like his predecessor, or those who went before him, the previous Minister for Aboriginal Affairs had gone to this area, promised the Aborigines housing, but they had received no housing. This information has been given to the Ministry in
Victoria. It would appear that we have received false reports from the Ministry in Victoria. We have the facilities available at present and I believe that we have provided funds in excess of the manpower and materials available to meet those housing needs. Money is available to supply the housing that is required in that area. We are establishing a housing co-operative in the area. Its purpose is to assist in the building of houses.
The question does not concern whether housing can be obtained. Mr Nixon has acknowledged the poor housing in the Gippsland area. He condemns to some degree his colleagues in Victoria who have the responsibility in this respect and who report that there are vacant houses in the area. I repeat, it is somewhat of a condemnation of his colleagues in Victoria- and is supported by Senator Brown’s report. As I have said, Senator Brown’s report is most comprehensive. I think it was a very good plan to take assistants to record the things he saw at the time he saw them, and the report has been most useful to me. It is thought that it will possibly be useful in other areas. I have received a letter from Mr Worthy advising that Mr Vance Dickie the Victorian Minister for Aboriginal Affairs, has asked for a copy of the report and also that the Minister will investigate any complaints. As a result of Senator Brown’s visit we may have done more for the Aborigines in the area. That leaves aside the question of who owes whom money as a result of a bet- which was such an important question to take up time during the adjournment debate in the other place.
Question resolved in the affirmative.
Senate adjourned at 11.41 p.m.
Cite as: Australia, Senate, Debates, 31 July 1974, viewed 22 October 2017, <http://historichansard.net/senate/1974/19740731_senate_29_s60/>.