Senate
4 May 1977

30th Parliament · 2nd Session

  1. Senate
  2. 30th Parliament
  3. 1977

The PRESIDENT (Senator the Hon. Condor Laucke) took the chair at 2.30 p.m., and read prayers.

page 1091

PETITIONS

Metric System

Senator WOOD:
QUEENSLAND

-I present the following petition from 22 citizens of Australia:

To the Honourable the President and Members of the Senate in Parliament assembled:

The petition of the undersigned citizens of Australia respectfully showeth objection to the metric system and request the Government to restore the imperial system.

And your petitioners as in duty bound will ever pray.

Petition received and read.

Pensions

Senator MULVIHILL:
NEW SOUTH WALES

-I present the folloing petition from 48 citizens of Australia:

To the Honourable the President and members of the Senate assembled. The petition of the undersigned citizens of Australia respectfully showeth:

That the delays between announcements of each quarterly movement in the consumer price index and their application as a percentage increase in age and invalid pensions is excessive, unnecessary, discriminatory and a cause of economic distress to pensioners.

That proposals to amend the consumer price index by eliminating particular items from the index could adversely affect the value of future increases in age and invalid pensions and thus be a cause of additional economic hardship to pensioners.

The foregoing facts impel your petitioners to ask the Australian Government as a matter of urgency to:

. Require each quarterly percentage increase in the consumer price index to be applied to age and invalid and similar pensions as from the pension pay day nearest following the date of announcement of the CPI movement.

Give an open assurance to all aged and invalid pensioners that any revision of the items comprising the consumer price index will in no way result in reductions in the value of any future entitlements to pensioners.

And your petitioners as in duty bound will ever pray.

Petition received and read.

Taxation

Senator GIETZELT:
NEW SOUTH WALES

– I present the following petition from 1 8 citizens of Australia:

To the Honourable the President and members of the Senate in Parliament assembled. The humble petition of undersigned citizens of Australia respectfully showeth:

That the existence of a system of double taxation of personal incomes whereby both the Australian Government and State Governments had the power to vary personal income taxes would mean that taxpayers who worked in more than one State in any one year would:

be faced with complicated variations in his or her personal income taxes between States; and

b ) find that real after-tax wages for the same job would vary from State to State even when gross wages were advertised as being the same; and

Require citizens to maintain records of income earned in each State.

Your petitioners therefore humbly pray that a system of double income tax on personal incomes be not introduced.

And your petitioners as in duty bound will ever pray.

Petition received and read.

The Clerk:

– Petitions have been lodged for presentation as follows:

Pensions

To the Honourable the President and members of the Senate. The petition of the undersigned citizens of Australia respectfully showeth:

That the delays between announcements of each quarterly movement in the consumer price index and their application as a percentage increase in age and invalid pensions is excessive, unnecessary, discriminatory and a cause of economic distress to pensioners.

That proposals to amend the consumer price index by eliminating particular items from the index could adversely affect the value of future increases in age and invalid pensions and thus be a cause of additional economic hardship to pensioners.

The foregoing facts impel your petitioners to ask the Australian Government as a matter of urgency to:

  1. Require each quarterly percentage increase in the consumer price index to be applied to age and invalid and similar pensions as from the pension pay day nearest following the date of announcement of the CPI movement.
  2. Give an open assurance to all aged and invalid pensioners that any revision of the items comprising the consumer price index will in no way result in reduction in the value of any future entitlements to pensioners.

And your petitioners as in duty bound will ever pray. from Senator Douglas McClelland, Senator James McClelland and Senator Missen.

Petitions received.

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SENATE STANDING COMMITTEE ON FINANCE AND GOVERNMENT OPERATIONS

Notice of Motion

Senator RAE:
Tasmania

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

That there be referred to the Standing Committee on Finance and Government Operations the following matter: Government funding of, and expenditure of public moneys by, Commonwealth statutory authorities and corporations, particularly those which present annual reports to the Parliament.

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QUESTION

QUESTIONS WITHOUT NOTICE

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QUESTION

CONCESSIONS AT MAJOR AIRPORTS: LEASES

Senator KEEFFE:
QUEENSLAND

– Is the Minister representing the Minister for Transport aware that in coming months the leases for several duty free concessions at major Australian airports will become due for renewal or replacement? Is he aware that such duty free concessions, particularly at the larger airports, have developed and are continuing to develop into multi-million dollar enterprises? As the Minister for Transport is the head of the Australian Government department which has sole responsibility for the allocation of the rights to operate such businesses, will he ensure that where all other things are equal, particularly those involving the terms and conditions of tender for occupancy, the contracts go to companies which are Australian owned and Australian controlled rather than the groups which are owned or controlled overseas?

Senator CARRICK:
Minister Assisting the Prime Minister in Federal Affairs · NEW SOUTH WALES · LP

– I was not aware that leases would be due for renewal, although I take it that that is happening fairly regularly. I am aware of a number of franchises at various major airports. I was not aware of their apparent profitability to which Senator Keeffe drew attention. I was aware that in the past some, particularly in the catering field, had shown a non-profitability. I am not aware of the condition under which the contracts are let or whether there is a tendering device. I think the best thing I can do is draw the attention of my colleague the Minister for Transport to those parts of the question asked by Senator Keeffe which relate to that portfolio and ask the Minister to give the honourable senator a response.

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QUESTION

RURAL TELEPHONE SERVICES

Senator DRAKE-BROCKMAN:
WESTERN AUSTRALIA

-My question is directed to the Minister representing the Minister for Post and Telecommunications. He will be aware of an answer given by the Minister for Post and Telecommunications yesterday concerning telephone facilities in country areas. While it is true that a majority of people may have a most adequate telephone service and that the Australian Telecommunications Commission is effectively reducing the number of manual type connections, could the Minister representing the Minister for Post and Telecommunications inform the Senate what is being done to assist those applicants at present without a service who are living well beyond the 12-kilometre radius of an exchange and who, under no stretch of the imagination, could be classified as living in isolated areas?

Senator CARRICK:
LP

-I fully understand Senator Drake-Brockman ‘s particular interest in those people who, being beyond the 12- kilometre limit, suffer some prejudice despite improvements in telecommunications. As I understand the position, the question to which Senator Drake-Bockman referred was one to which the Minister was responding on the suggestion that efforts of Telecom Australia should be redirected from research into the immediate provision of services to rural applicants. The Minister pointed out that the economic provision of rural telephone services in the future depended upon the research being conducted now. For example, he instanced the development of the use of solar energy in the Alice Springs-Tennant Creek microwave link. While the Minister stated that the great majority of Australians have a most adequate telephone service, he freely admitted that a number of people do not have a satisfactory service. He pointed out that at the end of this financial year only 1 1 1 000 subscribers will remain connected to a manual exchange in a total network of 3 million connections.

The honourable senator asks what efforts are being made for those applicants who live more than 12 kilometres from an exchange. He may be aware that last year the line plan policy was reviewed by Telecom Australia and that the free provision of line was extended from 8 kilometres to 12 kilometres. Those living within 12 kilometres of an exchange now pay nothing towards the line provided but those living more than 12 kilometres from an exchange had their contributions reduced by $ 1 ,280. Further to that, the contribution of $160 per half kilometre was retained at that level despite cost escalation since this rate was introduced in 1973. I draw the attention of Senator Drake-Brockman to an answer given to a question on notice asked by the honourable member for Darling in which the Minister stated:

When the charges for Commission services are being reviewed, the needs of people who reside or conduct their business in rural areas are given particular consideration.

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QUESTION

TELEPHONE INTERPRETER SERVICES

Senator MCAULIFFE:
QUEENSLAND

– I ask the Minister for Social Security whether it is a fact that the telephone interpreter service in New South Wales has almost run out of money and that instead of the $40,000 necessary to keep up the service until 30 June, it will have less than one-tenth of this sum available. Will the additional funds sought under the Appropriation Bills and disscussed in last week’s Estimates cover this $40,000 shortfall and any equivalent at other centres? If not, does the Minister expect to be able to call on further funds so that the service will continue to operate?

Senator GUILFOYLE:
Minister for Social Security · VICTORIA · LP

– There has been some concern that there were inadequate funds for the telephone interpreter service to maintain its operations until the end of this financial year. The figure which has been mentioned by the honourable senator-that is ‘$40,000-as being required’ has been provided by the Government to enable the service to be maintained. In saying that, I point out that there has been an enormous growth in the use of the service and that the funds which have been previously committed for this year totalled $390,000. With the addition of the $40,000 which has now been approved by the Government, a total of $430,000 will be available for this year. We need to add to that amount the funds which are provided for the staff of the Department of Social Security on the telephone interpreter service. In those funds we would be talking about an amount over $500,000, so we are looking at an expenditure of close to $lm. We regard the service as essential and very useful for migrants who have difficulty with language.

The Government considers that to have an open-ended migrant interpreter service, such as we have now, leads to difficulties in budgeting for anticipated requirements and leads to anxiety as to whether funds are provided. A report was presented by the Prime Minister in Parliament recently in relation to interpreter services. I think consideration must be given to some of the recommendations of that report when we look to the future needs of the interpreter service. The area of interest, of course, is that in New South Wales there is a greater use of the service by people who have consultations outside the Department. Professionals such as doctors, lawyers and others use the service on a consultant arrangement. It is in that area that we find a great growth and a need for further funds to be made available.

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QUESTION

SKILLED TRADESMEN

Senator CHANEY:
WESTERN AUSTRALIA

– My question is addressed to the Minister representing the Minister for Employment and Industrial Relations. I refer to the serious decline in the number of skilled tradesmen in Australia which is highlighted in the quarterly survey of April 1977 of the Australian New Zealand Banking Group Ltd. That survey indicates that, between 1971 and 1975, the number of skilled tradesmen fell by 12.7 per cent. In the same period, the annual migrant intake of skilled tradesmen fell by 58.5 per cent from 14 353 to 5955. Can the Minister outline what steps are being taken by the Government to increase the flow of skilled tradesmen? Does the Minister think that the steps taken by the Government to date are adequate to meet the problem or are further measures proposed?

Senator DURACK:
Minister for Veterans’ Affairs · WESTERN AUSTRALIA · LP

-It is a fact that Australia is faced with a persisting shortage of skilled trade persons. I have referred to this fact on a number of occasions in the Senate when speaking on behalf of the Minister for Employment and Industrial Relations. Recent recruitment into the skilled labour market does not seem to be matching the losses resulting from promotion, death, retirement and so on. So, the Government and the nation are faced with a serious problem in regard to this matter. However, the Government has been giving it a good deal of attention and has made a number of proposals most of which I have referred to already in this chamber in recent months. I will refer to them again because I think that they are most important. First of all there is a scheme known as the Commonwealth Rebate for Apprentice Fulltime Training- the CRAFT scheme. This is designed to increase the national apprentice intake by some 12 000 to 48 000 apprentices in 1979-80. The scheme has been designed to increase the effectiveness of government support for apprentices who previously trained under the National Apprenticeship Assistance scheme and provides rebates to employers in respect of all apprentices released to attend technical college for compulsory fulltime basic trade training. Also rebates are payable in respect of apprentices undertaking approved fulltime off the job training.

The March intake figures for apprenticeships indicate that already there has been an increase over the previous year of nearly 10 per cent. The Government had made available to the States an additional $5. 4m for pre-apprentice and accelerated training which will further increase the number of apprentices. The Minister for Employment and Industrial Relations recently announced that funds would be available to expand the use of the Government’s own apprentice training facilities under the group training scheme from 75 to 275 trainees. The Government believes that these initiatives will have some important impact in correcting the trends which are giving concern. Certainly the Government will keep the whole question under constant review.

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QUESTION

INTELLIGENCE ACTIVITIES IN AUSTRALIA

Senator BUTTON:
VICTORIA

– My question is directed to Senator Withers in his capacity as Minister representing the Prime Minister, the Minister for Foreign Affairs and the Minister for Defence. I refer to current Press and public speculation about the degree of knowledge amongst Australians and members of this Parliament of the activities of foreign intelligence gathering agencies in Australia. Are messages from the Pine Gap installation transmitted through the Defence signals establishment in Albert Park Barracks in Melbourne? Is there a United States installation in the Defence signals barracks in Melbourne and is it manned by members of an organisation known as SUSLO?

Senator Jessop:

– It sounds like a KGB body.

Senator BUTTON:

– It might be; that is why I am asking the question. If so, what is SUSLO? What is the function of the United States computer installation in the St James complex in St Kilda Road, Melbourne, to which only United States citizens are admitted? Is that building owned by the Australian Government and occupied by, among others, the Australian Security Intelligence Service?

Senator WITHERS:
Minister for Administrative Services · WESTERN AUSTRALIA · LP

– As honourable senators realise, I represent the Prime Minister, the Minister for Foreign Affairs and the Minister for Defence. The Australian Security Intelligence Organisation comes under the portfolio of the Attorney-General who is represented in this chamber by my colleague, Senator Durack. I suggest that the honourable senator put his question on notice.

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QUESTION

OIL PRODUCTION FROM COAL

Senator BONNER:
QUEENSLAND

– My question is directed to the Minister representing the Minister for National Resources. I draw the Minister’s attention to a recent report that an American chemical engineer, Professor Richard Wainerdi, is now locating and collating volumes of documents on Germany’s wartime methods of producing oil from coal. These documents fell into the hands of the United States at the end of World War II. These facts will be fed into the United States federally operated computer at Oakridge Energy Centre and the resultant information is to be made available to all interested parties. In view of the world wide energy crisis, does the Minister intend to take advantage of this service and circulate the information to our Australian scientists who are currently working on similar schemes to convert coal into oil economically?

Senator WITHERS:
LP

-I have no direct knowledge of this but I will seek information from my colleague in the other place.

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QUESTION

SUPERPHOSPHATE BOUNTY

Senator WALSH:
WESTERN AUSTRALIA

– I address my question to the Minister representing the Prime Minister. Given the Treasurer’s repeated exhortations to restrict Government assistance to the really needy, does the Government intend to cancel the Prime Minister’s $5000 a year superphosphate bounty?

Senator WITHERS:
LP

-I do not think that sort of question deserves an answer.

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QUESTION

REFERENDUM CAMPAIGN: USE OF VIP AIRCRAFT

Senator TOWNLEY:
TASMANIA

– My question is directed to the Leader of the Government in the Senate in his capacity as Minister representing the Prime Minister and as Minister representing the Minister for Defence. Is it true that the Prime Minister will be using VIP jet aircraft extensively during the referendum campaign and that if he follows his predicted schedule this will involve at least 19 hours of flying which, at about $800 an hour, will cost over $ 1 5 ,000 in less than 2 weeks? Are members of the Press to accompany the Prime Minister on any of these nights? If so, will they travel free of charge? Is it also true that if the Leader of the Opposition and the Deputy Prime Minister also jet around the country to the same extent in VIP aircraft the cost to the taxpayer will be over $40,000 in just 2 weeks?

Senator WITHERS:
LP

-I have no direct knowledge of this matter but I imagine that if members of the Press travel on VIP aircraft they will do so under the same terms and conditions as have always applied. I am calling on my memory, but Senator Bishop and Senator Drake-Brockman may remember this from their past experience in the portfolio. I think that when members of the media travel on VIP aircraft, accompanying Prime Ministers or Leaders of the Opposition, they pay the commercial air fare rates. I am delighted to know that the honourable senator is interested in the costs of the campaign. He has been able to work out to his own satisfaction what he alleges it will cost the taxpayer. So that we may all be fully informed, if he is a member of any No case committee perhaps he would disclose to us the sources of funds which the No campaign is receiving. If supporters of the No case are so pernickety about the Prime Minister and the Leader of the Opposition using their normal mode of travel perhaps they will give some son of undertaking that they will not use their warrant books, their parliamentary telephones or their office staff to present the No case.

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QUESTION

FOOTWEAR IMPORTS

Senator McLAREN:
SOUTH AUSTRALIA

– I direct my question to the Minister for Industry and Commerce. I refer to the joint press statement on 29 April by the Minister and his colleague the Minister for Business and Consumer Affairs in respect of import licences for textiles, apparel and footwear. I draw the Minister’s attention to page 2 of the statement which says:

In respect of import licences allocated for the importation of footwear during the period to 31 December 1977, the period of validity of these licences will be extended until 30 June 1978.

As the importation of footwear has an effect on the production of leather and employment in a large tannery at Mount Barker in South Australia, I now ask the Minister: What is the position of importers with a licence to import, say, 1000 pairs of shoes before 31 December 1977? Will the importers be able to import 1000 pairs at any time up to June 1978? Will this extension enable the importers to import more than 1000 pairs between now and the end of June 1978?

Senator COTTON:
Minister for Industry and Commerce · NEW SOUTH WALES · LP

– This clearly is a question that has emanated from somebody who has some particular concern in this area. I could probably be helpful if the honourable senator were to give me more details than are contained in his question. I should like to know the identity of the people concerned so that I can take up the matter specifically with the Department to try to resolve the problem. I undertake to do that.

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QUESTION

EMISSION CONTROLS

Senator YOUNG:
SOUTH AUSTRALIA

-I ask the Minister representing the Minister for Transport: Are reports correct that the Minister for Transport, Mr Nixon, may reduce the standards on exhaust emission in motor vehicles to increase fuel conservation? If so, is it proposed to continue the use of lead as an additive to petrol, which increases the octane rating in fuel and so adds to efficiency and decreases fuel consumption?

Senator CARRICK:
LP

– I have seen reports of the proposed actions of the Minister for Transport. I have no immediate knowledge of the matter. I will refer the question to the Minister for Transport and obtain an answer for the honourable senator.

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QUESTION

EMISSION CONTROLS

Senator MULVIHILL:

– I direct a question to the Minister representing the Minister for

Environment, Housing and Community Development. Since the current report of that Department features the role of the present Government on air quality and general air monitoring, I ask: Was the Minister for Environment, Housing and Community Development consulted by the Minister for Transport on the decision to reduce car and truck exhaust emission standards?

Senator CARRICK:
LP

– The question requires information from both the Minister for Transport and the Minister for Environment, Housing and Community Development, both of whom I represent in this place. I will refer the honourable senator’s question to both Ministers.

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QUESTION

BRUCELLOSIS AND TUBERCULOSIS ERADICATION PROGRAM

Senator THOMAS:
WESTERN AUSTRALIA · LP

– My question, which relates to the brucellosis and tuberculosis eradication program, is directed to the Minister representing the Minister for Primary Industry. I preface my question by saying that our exports of meat, particularly to the United States, are likely to be at risk if these 2 cattle diseases are not eradicated by 1984 when the United States is expected to be free of them. Will the Minister draw to the attention of the Minister for Primary Industry the importance of maintaining an adequate level of funding to allow the States to continue the eradication program?

Senator COTTON:
LP

-I have an interest in this matter. It is a serious matter and the honourable senator’s question is well directed. We could have problems with meat exports in due course if the eradication program is not fully successful. In the hearings of the Estimates Committee with which I was involved this matter came up for discussion with regard to the Northern Territory. I think it is a serious matter and it should be taken seriously. During the Estimates Committee hearings I asked the members of the Department of Primary Industry who were present to examine this question seriously. I will refer the honourable senator’s question to the Minister.

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QUESTION

UNEMPLOYMENT BENEFIT STATISTICS

Senator GRIMES:
NEW SOUTH WALES

-Will the Minister for Social Security release to senators and members on request the quarterly analysis of unemployment beneficiaries to which she made reference in a reply to me recently? Will she also consider releasing a 4-weekly summary of statistics for the Benefits Policy and Review Division, which is circulated regularly in her Department? Can the Minister supply to the Senate a list of statistical publications which are prepared for internal use in her Department? Will she also consider the release of such statistics to members of both Houses of Parliament?

Senator GUILFOYLE:
LP

– I will give consideration to the matters that have been raised by the honourable senator. I would be pleased to make available the 4-weekly statistics of unemployment benefit. I was unaware that they were not publicly available. I think it is desirable that members of Parliament and the public be made aware of the particulars of beneficiaries and the information contained in that release. I will give consideration to the other matters. I would be delighted to release whatever information is of service and of interest.

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QUESTION

REFERENDUM CAMPAIGN: USE OF VIP AIRCRAFT

Senator WOOD:

– I direct a question to the Leader of the Government in the Senate. In view of the wasting of nearly $ 10m of Australian taxpayers’ money on the forthcoming referendum and in view of the fact that Mr Fraser and Mr Whitlam are now so pally on this matter, does the Leader not think that there would be some saving to this country if Mr Whitlam and Mr Fraser travelled together in one VIP plane during the campaign?

Senator WITHERS:
LP

-That is an interesting suggestion but what is even more interesting is how those in favour of the No case are going to travel together when there are 1 1 opposed to one question, 9 opposed to two, 2 opposed to one and none opposed to all. I think that would be an even more disparate group of people travelling together. I would find more fascinating the question: Who is the leader of the band? Whilst it is a good throw-away for the honourable senator to talk about expenditure of this amount of money I do not think he really understands what it is all about because after all as a result of expending this sort of money now there could be enormous savings in the future. But as the honourable senator ought to know, the referendums are not just about the saving of money. As I understand the questions, and as I think the great majority of Australians understand them, they are about putting common sense, decency and fairness into Australian political life. I have yet to find any honourable senator who is prepared to say that under no circumstances ought elections for the Senate and the House of Representatives be held at the same time. There may be some quarrel about our method of going about this but I thought everybody was in favour of the principle involved. I have also yet to hear anybody say he is opposed to the principle that replacement senators should come properly from the party to which the former senator belonged. Those who are opposed to the filling of casual vacancies in this way ought to make their declaration clear. I think the expenditure of the money is well worth it if it puts common sense, decency and fairness into Australian political life.

Senator WOOD:

– I wish to ask a supplementary question.

The PRESIDENT:

– I call Senator Wood on a supplementary question.

Senator Missen:

– Running scared?

Senator WOOD:

– I have never been scared like you. The Minister went into great detail to dodge the question and talked about the expenditure of money being worth while and the saving of money with simultaneous elections. Why could not the Government have shown practical evidence of its truthfulness in this direction by having these referendum questions put at the same time as the next Senate election is held, thereby saving $ 10m of the taxpayers ‘ money?

Senator WITHERS:

-Evidently the honourable senator misunderstood what I said. These 4 referendum questions, and the first two in particular, are not all about saving money. That is but a side benefit. What the referendums are about is to stop contrived vacancies in this place and manipulated replacements. That is why I say they are all about bringing common sense, decency and fairness into Australian politics and particularly into this House of Parliament. I would have thought that what we saw done by various people from all Parties -

Senator Primmer:

– Mainly under LiberalCountry Party governments, of course.

Senator WITHERS:

-A11 parties-I do not wish to start naming various individuals and events. We saw 3 instances between 1972 and 1975 when the present constitutional position was manipulated or an attempt was made to manipulate it for party political advantage in this place. I do not think the Constitution ought to remain unchanged and allow that sort of thing to happen. There was an attempt originally, if we want to get down to facts, to create an artificial vacancy, which failed. Two other things were done in respect of the replacement of senators. Whilst things may have been said and done during that very hectic, exciting 3 years, I should think that on calm, sober reflection all Australians would come to the conclusion that if this House is to survive, and to survive as the important place it is in the national Parliament, it is well worth spending $ 10m or even more to make sure that in future vacancies cannot be contrived and replacements manipulated for mean, party political advantage. I think that money will be well spent for the preservation of democracy in this country.

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QUESTION

DEFENCE SERVICE HOMES

Senator BISHOP:
SOUTH AUSTRALIA

– My question is directed to the Minister for Veterans’ Affairs and follows my previous questions to him about the possibility of the Government increasing interest rates on defence service homes. It also follows closely upon the very extensive publicity given to the claim that some interdepartmental committees and Government agencies have before them proposals which not only will increase interest rates but also may result in handing over to State agencies some of the functions of the present defence service homes organisation and the possibility of land holdings for those purposes in my State and other States being sold. Does the Minister recall that in reply to the most recent question about this matter on 1 7 February, he stated:

  1. . I say again now, that the Government has no plans to increase interest rates on defence service homes.

I now ask the Minister: Is he able to clear up the position? If the Press report is accurate I suggest to the Minister that it would be in the interests of everybody that an honest statement about the matter be made to the Senate and to the Press.

Senator DURACK:
LP

-I should dearly like to clear up this matter. I have been attempting to do so for some months in answer to a series of questions that Senator Bishop and others have asked me. I hope that Senator Bishop is not suggesting that my answers have not been honest in these matters because I have endeavoured to answer the questions clearly and to the point. But this speculation continues to be ventilated in the Press, particularly this morning in the Sydney Morning Herald. I cannot be responsible for the sort of reporting- garbled and otherwise- that takes place in the Press and of which this article this morning is a pretty good example.

I reiterate that the Government does not have any plans to increase the interest rate on defence service homes. The article this morning canvasses some proposals- to hand over loans to the States or to State building societies and thereby to increase interest rates- that allegedly are being prepared by the Australian Housing Corporation to be put before some Federal Government committee. I can say categorically, firstly, that there is no Australian Housing Corporation. That Corporation was abolished last November, which shows how up to date are these reporters who print this sort of stuff. I can say categorically that the Defence Service Homes Corporation, which is now under the aegis of my Department, is not placing any plans of this sort before any Government committee and is not placing before any Government committee or before the Cabinet any proposals to increase interest rates.

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QUESTION

REFERENDUM PROPOSALS: SIMULTANEOUS ELECTIONS

Senator MISSEN:

-Has the attention of the Minister representing the Attorney-General been drawn to the repeated assertion by Senator Rae, on behalf of the referendum No campaigners, that the simultaneous election proposal makes no provision for simultaneous elections? Did the Minister not, in debate on the Constitution Alteration (Simultaneous Elections) Bill in February, clearly dispose of this misleading and pettifogging assertion? In view of the danger of the people being deceived by repetitive assertions of this nature, will the Minister reassure the public that they will achieve simultaneous elections, with all their attendant benefits, by voting for this proposal?

Senator DURACK:
LP

– My attention was drawn to an article this morning in the Age newspaper reporting the statement by Senator Rae. The statement is one which the honourable senator has made on several occasions. The matter was canvassed in the debate on the Constitutional Alteration (Simultaneous Elections) Bill 1977 in this chamber. I refer again to the proposal that was in that Bill which was passed by the Senate and which is now to be placed before the electorate on 2 1 May. The proposal seeks to alter the Constitution to ensure that Senate elections are held at the same time as House of Representatives elections. That proposal also contains the provision that this Parliament is to make the laws for determining the times and places of elections of senators. As I have pointed out in the debate on this matter in the chamber before, an election is not simply a polling day. An election is a long process. There is the issue of the writs. There are the nominations. There is the poll. There is the return of the writs.

It is quite obvious from the nature of the proposal for simultaneous elections, coupled as it is with a proposal for this Parliament to make laws for the holding of Senate elections, that it will obviously be the purpose of any government to ensure that the election for half the Senate will be held at the same time as and on the same day as elections for the House of Representatives. As I have already pointed out, our existing electoral laws provide that, because there may be some exigency on a polling day in a part of Australia, the actual poll may have to be postponed. There may be flood, fire, cyclone or any similar natural disaster with which we are so familiar in this country. It is not necessarily the case that polling in an election takes place everywhere in Australia on the same day, although naturally as we all know by and large that is the case, and that is what is to be intended to be the provision in this proposal. The proposal is one which I am sure any Australian Government and any Australian Parliament will carry out.

page 1098

QUESTION

SPORTING LINKS WITH SOUTH AFRICA

Senator PRIMMER:

– My question is directed to the Minister representing the Prime Minister. In view of the Prime Minister’s strong statement regarding bans on sporting links with South Africa, is the Minister aware of an Australian squash tour of South Africa commencing on 3 1 May? Is the Minister aware that the team consists of 4 players and a manager? Will the Minister undertake to investigate this matter and to see what steps can be taken by the Government to stop such a visit? Will the Government raise this matter with Australian squash officials?

Senator WITHERS:
LP

-I will seek the information for the honourable senator.

page 1098

STUDENT RALLY

Senator JESSOP:

-Has the attention of the Minister for Education been drawn to, or did he hear, a segment of the AM program this morning which was devoted to an alleged attack on Michael Danby by Trotskyite students at a rally.

Senator Gietzelt:

– Unnamed.

Senator JESSOP:

– Communists, if you like. Let us be honest. Let us use the words ‘communist students’. It was alleged in the segment that the students struck the said Michael Danby with a banner purported to have been a Eureka Stockade flag. Is the Minister able to give a report on that incident? The second part of my question relates to the same subject. Is the Minister aware that 2 Adelaide University students, for conscientious objection reasons, refused to contribute $2.50 of their fees to the funds of the Australian Union of Students? In view of this type of activity, will the Minister consider enabling such students to opt out of contributions to a political fund that obviously is used to encourage violence in Australia?

Senator CARRICK:
LP

-I heard part of the report on AM this morning quite by accident. Any comment I make must necessarily be carefully guarded in that it will be based upon only what I have heard and what minor inquiries I have been able to make so far. This must be a police matter for the time being. I understand it is generally agreed that Michael Danby was involved. I think he was president of the Melbourne University Student Representative Council until recently.

Senator Wheeldon:

– And a member of the Australian Labor Party.

Senator CARRICK:

-I think that is true. I think that he is a member of the Australian Labor Party. He is now the national convenor of the coalition to reform the Australian Union of Students. My understanding is that at ap- proximately 7.30 last night, on the comer of F linders Street and Williams Street in Melbourne, he suffered an attack by a number of males. I understand that he suffered head injuries, that he reported to a traffic policeman and was taken to hospital overnight, that he is now discharged from hospital and that it is alleged by a witness- I think I heard the voice of a female witness on AM- that the attackers carried Eureka banners.

This is a State police matter. I merely record the essential facts that I attempted to secure in that narrow context. In the wider context one may assume that the question directs itself hypothetically to violence in student bodies. I divorce the first part of the question because it must stand on its own facts and not be helped or hindered by me. I should report to the Senate, as I think I have done, that I have conveyed to all universities and colleges the message from the Government that violence, threats and intimidation must not be tolerated in any way; that students have no more immunity than any other people and that campuses have no immunity from the ordinary laws of the land. Of course, last night’s events did not occur on a campus. My attention is also directed to a report in the Adelaide Advertiser. I understand from the facts reported in the Advertiser that an appeal by some students to be able to opt out from the AUS levy was refused by the student union council.

I make it abundantly clear that the rules governing students, student bodies and student conduct in universities and councils are made as regulations or ordinances by the university bodies themselves. I do not say this in any sense of abdication. I fully understand that the people of Australia have a growing impatience with this problem. It would be foolish of me to deny that a considerable amount of correspondence I receive is directed to this problem. The Government itself is keenly mindful of it, is aware of its own responsibility and wishes to get the best answer.

Senator Harradine:

– What about the Australian National University?

Senator CARRICK:

– If the honourable senator would like to ask me a question on that matter I shall be perfectly happy to answer it. The protection of academic freedom, which is of great value in this community, is achieved by setting up universities and councils as statutory bodies in which they make their own rules. It is totally competent for any university or council to make rules for student bodies to allow an opting out in conscience or to allow for voluntary participation. I make it perfectly clear to honourable senators that the primary responsibility for democracy and the execution of an action of conscience on any campus is that of the governing body- the senate or the council of the university. Without specific knowledge of the matter, there seems to be, on the face of it, a question for some inquiry by the governing body of the university to see whether provision for opting out should be made. Honourable senators will know that in response to several questions by Senator Walters about a young man at the ANU I suggested that it would be competent upon the ANU to provide opting out processes. The fundamental thing to do is to invite the universities and colleges, through their governing bodies, to look at this problem to see whether they can resolve it. That is what my Government has done. We have asked them to look to their rules. We have an assurance from them as to the upholding of the law on the campus. A number of them have already provided opting out processes. A number of others, I understand, are contemplating such processes.

Let us take this matter in a sober fashion, bearing in mind that there are very real dangers if governments, State or Federal, should attempt to intrude their legislative powers to restrict on a campus, student or other action, political or otherwise, because it is very hard to decide what is true academic freedom and what is intimidation. I come back to the matter because it is fundamentally important: The first responsibility is that of the governing bodies. Nevertheless, the Commonwealth Government has this matter under strong surveillance. It has been in touch with the universities and colleges and will remain in touch with them.

page 1099

QUESTION

OVERSEAS VISITS BY MINISTERS

Senator DEVITT:
TASMANIA

– Will the Leader of the Government in the Senate provide to the Senate details, including costs, of Ministers’ overseas visits during the life of the present Government? Could he indicate what further overseas trips are planned by Ministers in the coming winter recess?

Senator WITHERS:
LP

-I think I can supply at reasonably short notice the first information asked for by the honourable senator. The latter information is a matter within the Prime Minister’s jurisdiction. I will ask him whether he is prepared to supply it.

page 1099

QUESTION

REFERENDUM: CASUAL SENATE VACANCIES

Senator WRIGHT:
TASMANIA

– I direct a question to the Leader of the Government in the Senate. By way of preface, with your indulgence, Mr President, I ask you to observe that the length of my question will be disproportionate to the length of the answer previously given by the Leader on the referendum question and entirely disproportionate to the time allowed for the debate on this matter because of the application of the guillotine. My question to the Leader is this: In regard to the proposal for casual vacancies, did the subcommittee of the Hobart Constitutional Convention report that it was inappropriate to introduce into the Constitution as an amendment the principle of replacement from same parties? Did that recommendation of the sub-committee adopt the 1959 committee’s report which recommended to the same effect -

Senator Missen:

– The committee did not say that.

Senator WRIGHT:

– . . . that is to say, the principle of replacement from the same Party, as a political agreement, was acceptable but because of language difficulty it was not capable of being drafted to make it a constitutional provision.

Senator Missen:

– The committee did not say that.

Senator WRIGHT:

- Senator Missen chips in and chips in. It shows how anxious he is to smear his colleagues. He referred to one of my colleagues as pettifogging and misleading. He will have to take it in return so long as he gives out that sort of stuff. My question also asks the Leader whether there was a debate in Hobart on a part of that casual vacancy proposition in which it was accepted that the principle should apply to vacancy by death and disqualification but in respect of vacancy caused by resignation the principle should apply only to bona fide resignations -

Senator Walsh:

– Who would define that?

Senator WRIGHT:

– … in the case of bona fide ill health or incapacity. That could be determined objectively- in reply to the interjector in the same way as any other matter.

Senator Keeffe:

- Mr President, I raise a point of order. The honourable senator is asking a question which is going over many minutes and that is quite contrary to the Standing Orders. It is a great pity that as a member of the Liberal Party he has taken this opportunity to slash into other members of the Liberal Party. I feel that he ought to be brought back to within the terms of Standing Orders.

The PRESIDENT:

- Senator Wright, ask your question and be as brief as possible.

Senator WRIGHT:

-Was the debate as to whether the proposition should be confined in the case of resignation to only bona fide ill health or incapacity, voted on? Did Senator Withers, as one of the delegates from the Commonwealth Parliament, vote on that question? Did he vote in favour of the proposition that a resignation which should attract the principle, should be only bona fide ill health and incapacity? If he did, and if he is now advocating a further extension of that principle, is this another case where he has been wrong?

Senator WITHERS:
LP

-I will be as brief as the questioner if I can. Yes, I did vote in favour of a motion, as amended and finally put at Hobart, in which the Convention supported the principle that upon the death or resignation, because of bona fide illness, of a senator, the replacement senator should come from the same Party. I think it is correct, as the honourable senator has said, that the 1 950 committee report was basically of the same opinion. It said- I hope I am not taking the words out of context- that the principle was not capable of being drafted into legislative form to put into the Constitution. I think it is also fair to say that at the Constitutional Convention, when my colleague Senator Durack was speaking to the motion, he indicated that the Commonwealth Government believed that it was possible to draft an amendment to be submitted to the people to put the principle in constitutional form. That is what I recall was said during that Convention. So, yes, I did vote in favour of a motion as amended and as passed. But I point out that at that Convention it was flagged that the Government believed that the principle was capable of being drafted and put into constitutional form.

While talking about the Constitutional Convention in Hobart, I remind the honourable senator and anybody else who cares to take notice, that I was not the only person between the referendum in 1974 and the present time to change my mind about simultaneous elections. As I recall the Hobart Convention in October 1976, which is 6 or 7 months ago, quite a number of people including most of my State colleagues of my Party also changed their minds and voted in favour of a motion which was submitted to the Convention that the Commonwealth Government be again asked to submit, basically in the same form, the proposition which had been submitted to the Austraiian electorate by the previous Government. So if I have changed my mind once and if I have done that, as Senator Sir Magnus Cormack said yesterday, by sitting on a penitent’s stool, I point out that I changed my mind after reflecting on the Constitutional Convention. Others changed their minds at the same period but they have since changed back again. While I have been asked and quoted about why I changed my mind once in a 3-year period- I have confessed quite frankly the reason for that- I think questions also ought to be directed to those who changed their minds with me last October but who have since changed them again.

page 1100

QUESTION

PRICE OF PHARMACEUTICAL GOODS

Senator BROWN:
VICTORIA · ALP

– My question is directed to the Minister representing the Minister for Health. I understand that the Government has finalised the purchase of the Fawnmac group of pharmaceutical manufacturing companies. If my assumption is correct, why did the Government allow this organisation to increase its wholesale prices sharply on 14 items on 14 April 1977, the day after the Prime Minister stated that the price freeze was in operation?

Senator GUILFOYLE:
LP

– This is a question which I will need to refer to the Minister for Health, whom I represent. I have no knowledge of the matters that have been raised. I will seek an answer from the Minister for Health as soon as possible.

page 1100

QUESTION

CONFIDENTIALITY OF MEDICAL RECORDS

Senator BAUME:
NEW SOUTH WALES

– I direct my question to the Minister representing the Minister for Health and it concerns an apparent gross breach of the confidentiality of medical records in the Australian Capital Territory. I preface the question by reminding the Senate of the concern which I expressed in this chamber some 2 years ago about the improper transfer of information on patients attending mental health services in the Australian Capital Territory. Is it a fact, as reported in today’s Press, that the personal mental health file of a patient attending mental health services in the Australian Capital Territory was found in the gutter of a Canberra street? Can the

Minister inform the Senate of details of the investigation which, we hope, now is being made into this breach of confidentiality? Is she able to seek from the Minister in another place his agreement that there be made available to the Senate both the result of the investigation and an outline of new measures proposed to improve and further protect patient confidentiality in this country?

Senator GUILFOYLE:
LP

– I have knowledge of this matter only from the Press report of the finding of a file containing a person’s medical history in a Canberra street. I have no knowledge whether the Minister for Health has ordered an investigation or what other steps have been taken by him in regard to this matter. From my understanding of it, it does not appear to be an intentional breach of confidentiality but that would be a matter on which the Minister for Health would comment. I will advise the honourable senator as soon as I have some information from the Minister on this matter.

page 1101

QUESTION

ISSUE OF PENSIONER HEALTH BENEFITS CARDS TO REPATRIATION SERVICE PENSIONERS

Senator DONALD CAMERON:
SOUTH AUSTRALIA

-My question is directed to the Minister for Veterans’ Affairs. Is it a fact that repatriation service pensioners are not entitled to a pensioner health benefits card and therefore do not qualify for the South Australian Government’s pensioner concessions on public transport and in respect of council and water rates, land tax and motor vehicle registration? Will the Minister undertake an investigation into this matter to ascertain whether the same means test which is applicable to all social security pensions could be applied to all Service pensions so that Service pensioners can qualify for the same State government concessions?

Senator DURACK:
LP

– The same means test applies to Service pensioners, properly so-called, as to age pensioners. The principal distinguishing feature of the Service pension is that a person who is otherwise qualified to receive it is eligible to receive it at age 60 instead of age 65. Eligibility for fringe benefits is also the same. Whether certain State transport concessions are given is a matter for the State governments and not for the Federal Government or for the Department of which lama Minister.

page 1101

QUESTION

TAXATION: SUPERANNUATION PROVISIONS

Senator MESSNER:
SOUTH AUSTRALIA

– My question is directed to the Minister representing the Treasurer. Is it a fact that the Taxation Commissioner for the purposes of the Income Tax Assessment Act now recognises maximum superannuation benefits as high as $251,832, compared with $80,000 in 1970, as a basis for calculating deductions allowable to companies for contributions on behalf of employees. Has this not resulted in substantially increased taxation deductions being allowed to businesses trading as companies? Is it also a fact that small businesses and professional persons who are prohibited from operating as companies by virtue of smallness or ethical considerations are entitled only to a taxation deduction of $1,200? Is this level the same as that established 10 years ago? Does the Minister agree that on grounds of equity such taxpayers should be entitled to increased tax deductions to bring them into reasonable relativity with those who are able to arrange their affairs so as to trade as companies?

Senator COTTON:
LP

– The honourable senator asked me whether I could obtain some information about this matter. I have a prepared answer. It is a long answer but I think that it is an important answer and therefore I shall deliver it in full. The Commissioner of Taxation has advised that when the guidelines relating to the then new income tax provisions concerning superannuation funds were issued in 1965 in the form of Public Information Bulletin No. 6, it was made clear that it was impracticable to state precisely the amounts that in all circumstances would be accepted as ‘reasonable benefits’. An amount of benefit equal to 7 times annual remuneration with an upper limit of £40,000, or $80,000, was determined as being appropriate where there were no special circumstances. The Commissioner was prepared to accept that remuneration in excess of £5,714, or $ 1 1 ,428, was a special circumstance and, when taken into account with other factors, benefits in excess of $80,000 were approved in many cases. With inflation this nominal upper limit of $80,000 was progressively increased in 3 stages- in 1972, 1975, and 1976. It now stands at a figure of $141,250. For the purposes of determining benefits in excess of the nominal upper limit the Commissioner used a sliding scale of annual remuneration with, initially, an absolute maximum of $200,000. In the revision made in 1972 this absolute maximum was abandoned. With the abandonment of the absolute maximum the amount of benefit which may now be provided is dependent only upon the special circumstances obtaining in any particular case.

The deduction of employers’ contributions to superannuation funds on behalf of employees is governed by specific provisions of the income tax law. These deductions are available to all employers whether or not they may be companies. The statutory deduction available in respect of each employee is the greater of $400 and 5 per cent of the employee’s annual remuneration. The provisions also grant the Commissioner a discretion to allow a greater deduction where he is of the opinion that there are special circumstances. These provisions of the law have, except for a change to convert the amount to decimal currency, remained unaltered since their introduction in 1964. However, deductions available to employers have increased as levels of remuneration of employees have increased.

The contributions which may be made by selfemployed business or professional persons to superannuation funds and the benefits which may be accumulated for them have also been reviewed from time to time in order to keep pace in some measure with inflationary trends. The amounts which may at present be contributed by such persons are as follows:

  1. Where the member is under the age of 40 years when the contribution is made-$ 1,700;
  2. Where the member is aged 40 years and not over 55 years-$2,900; and
  3. Where the member is aged 55 years or more-$4,000.

Should the present inflationary trends continue, it is proposed by the Commissioner that these amounts will be reviewed from time to time. A deduction for income tax purposes is not allowable in respect of these contributions. However, where any taxpayer makes contributions on his own behalf to a superannuation fund he may, subject to the relevant provisions of the income tax law, be entitled to a concessional rebate based on so much of the contributions as does not exceed $1,200.

Ten years ago a concessional deduction was available in respect of a taxpayer’s own contributions to a superannuation fund up to a maximum of $800. This was increased to $1,200 in respect of the income tax year 1967-68. This concessional deduction of up to $1,200 continued until the income tax year 1975-76 when the present concessional rebate system was introduced. A rebate paid on such contributions up to $1,200 has now been substituted for the previous deduction.

It is agreed by the Treasurer that it would be desirable to secure as close a relativity as may be practicable- not only with taxation concessions for contributions but also with taxation liabilities on benefits- as between the situations of people who can conduct their business operations through a company structure and people who cannot. Quite a lot was said on these matters in the report presented by the Asprey Committee. I assure the honourable senator that the Government will examine the Committee’s views on the subject at the earliest opportunity.

page 1102

QUESTION

FOUNDRY INDUSTRY

Senator GIETZELT:

– I direct a question to the Minister for Industry and Commerce in that capacity and also in his capacity as representing the Minister for Overseas Trade. Is the Minister aware of the grave problems facing the foundry industry, arising from the recent high volume of imports? Has the Government any evidence of the uncompetitive practices of overseas corporations and countries which constitute dumping of products in Australia? What measures does the Government suggest can be taken to eliminate these unfair trading practices? Will the Minister give consideration to tabling all documents dealing with this problem?

Senator COTTON:
LP

-These matters are dealt with by the Industry Advisory Council, with which I work, in its heavy engineering section. At a recent discussion in the Cabinet room with members of the Heavy Equipment Manufacturers Association, the problem of the foundry industry was dealt with as part of the whole of heavy equipment manufacturing. We talked about this particular matter. We asked the Association whether there was any clear evidence of dumping of which it was aware. We could not get clear evidence of dumping although we left the matter open and indicated that the Department of Industry and Commerce would be receptive to any information given to it about dumping. No such information has been given to me in the last week or so. I will check out the matter after question time. It should also be observed that part of the foundry industry’s problem has proved to be the very heavy imbalance in the Australian cost structure that occurred over 5 years. It is very clear that the foundry industry has difficulty in competing against people who import goods into Australia. This is one of the great problems of the manufacturing industry in particular. Therefore, one is always fascinated to read in various papers from time to time that what we need in this country is to have total access to all imports. Of course, if that happened we would have total unemployment everywhere.

page 1103

QUESTION

REFERENDUM ADVERTISING

Senator WITHERS:
LP

-Yesterday Senator Douglas McClelland raised with me the question of an advertisement which appeared in the Sydney Morning Herald last Saturday seeking financial support for the No case in the forthcoming referendum. The advertisement purported to be issued by the New South Wales No Case Committee. It claimed that members of the New South Wales No Case Committee included such people as Senator Rae and Senator Martin. It also described a Senator Jack Kain as a member of that Committee. As I said yesterday, there was a former Senator Kane who represented New South Wales in the Senate from 1971 to 1974. Since I answered yesterday’s question former Senator Kane has contacted my office. He wishes the record to be set straight. He dictated this statement to my office yesterday afternoon:

My attention has been drawn to a question asked in the Senate today by Senator Douglas McClelland concerning an advertisement for the No case.

In this advertisement I was erroneously referred to as Senator Kane instead of former Senator Kane.

I am a member of the No case.

As it happened, however, I did not see the draft of the advertisement nor did I see the actual advertisement itself.

I had no knowledge of it until the matter was raised in the Senate today.

I make that statement to clear any inference that former Senator Kane who sat in this place for 3 years may himself have been attempting to misead the public as to his present position. I thought that in fairness to Jack Kane I ought to make that statement.

page 1103

QUESTION

LANDS COMMISSION

Senator CARRICK:
LP

-I should like to correct an answer I gave to Senator Colston in response to his question on notice No. 257 which was printed in Hansard of 27 April. In part 2 (c) of my answer I referred to question No. 1529. That question in fact was not answered due to the proroguing of Parliament earlier this year. I should like to delete reference to question 1529 from my answer to the honourable senator so that the section would now read: 2 (c) the Premier of Queensland in February and March 1976 indicated an interest in obtaining Commonwealth financial assistance for expansion in urban development and his request is being considered in the context of overall Commonwealth policies.

page 1103

QUESTION

MINISTER FOR THE NORTHERN TERRITORY: VISIT TO DARWIN

Senator WEBSTER:
Minister for Science · VICTORIA · NCP/NP

– I seek leave to clarify an answer to a question which I gave yesterday to Senator Keeffe.

The PRESIDENT:

-Is leave granted? There being no objection, leave is granted.

Senator WEBSTER:

-Yesterday Senator Keeffe asked me questions about a visit to Darwin this week by the Minister for the Northern Territory (Mr Adermann), whom I represent in this place. He implied that the Minister had made an unnecessary visit. I quote part of his question:

Was the Minister aware that it was common knowledge before he boarded his flight to Darwin that there was little or no danger of the cyclone crossing the coast at Darwin and that the cyclone was developing into a quite normal tropical rain depression?

As I stated yesterday, I alerted the Minister for the Northern Territory about cyclone Verna on Saturday and kept him informed of developments during the weekend. I also kept the Prime Minister’s office informed. I am now able to give the honourable senator more positive information. Mr Adermann also was in regular communication with the Secretary of his Department and the Administrator of the Northern Territory. He informs me that he kept in touch with the situation throughout the weekend. The time of threat was Sunday night and early on Monday morning. A yellow alert, which is an emergency service alerting code put out for a locality when a full cyclone warning is current for that locality, was issued on Sunday night. The Darwin Disaster Council was called into operation and the Minister received reports almost hourly until 3 a.m. on Monday, recommencing at daybreak.

The cyclone intensified further during Sunday and moved closer to Darwin, necessitating a warning for Darwin proper. The report at 2 a.m. on Monday indicated winds of 170 kilometres per hour at the centre. At 3 a.m. on Monday the Darwin Disaster Council was very seriously contemplating an amber alert at daybreak, which would have meant all residents going to designated safety areas. At 6 a.m. on Monday the Minister was informed that, based on the latest satellite pictures and other information, the cyclone had slowed but was still intense, and destructive winds were forecast close to its centre. The Services viewed the situation so seriously on Monday morning that naval vessels were moved from Darwin to safe areas.

Mr Adermann informs me that as Minister for the Northern Territory he left his office for Darwin at 1 1 a.m. on Monday with the full consent and support of the Government. When he left Canberra he did not know whether he would be able to land at Darwin or be forced to put down at Tindal, some 320 kilometres away, and proceed to Darwin by car. It was not until he landed at Mt Isa that he found he would probably be able to land at Darwin and it was not until 11.30 a.m. that it was known with reasonable certainty that the cyclone had lost intensity, and the yellow alert was then removed.

The Minister informs me that it was important he obtain a full briefing from the Darwin Disaster Council and that that briefing was in every way very pleasing. The state of preparedness appeared satisfactory. Mr Adermann advises me- and I fully support his advice- that it is reprehensible of Senator Keeffe to try to generate political capital out of a situation that was one of real worry and concern, especially as Senator Keeffe was in Darwin on Monday and therefore was in a position to learn how serious the situation was. Mr Adermann informs me that he did go to Darwin by Royal Australian Air Force aircraft because there was no other way he could go. He went because it was his responsibility to be there.

The Minister for the Northern Territory returned from Darwin yesterday after a final debriefing with the Darwin Disaster Council at 8 a.m., a visit to the Bureau of Meteorology and a Press conference, and after having been thanked and commended from all quarters, irrespective of politics. I consider that this Senate is appreciative of the responsibility which the Minister for the Northern Territory demonstrated on behalf of the Australian community.

page 1104

GENERAL MOTORS-HOLDEN’S PTY LTD

Matter of Urgency

The PRESIDENT:

-I inform the Senate that I have received the following letter dated 4 May 1 977, from Senator Wriedt:

Dear Mr President,

In accordance with Standing Order 64, 1 give notice that today I shall move that, in the opinion of the Senate, the following is a matter of urgency:

The community’s serious concern about General Motors-Holden ‘s proposal to enforce all employees to take one week’s leave;

The company’s failure to adequately consult the Australian Government and the trade unions in respect of the above; and

The urgent need for the Government to make firm decisions in respect of the industry.

Yours sincerely, K.S. WRIEDT

Is the motion supported?

More than the number of Senators required by the Standing Orders having risen in their places-

Senator WRIEDT:
Leader of the Opposition · Tasmania

– I move:

The Opposition moves that motion because it is extremely concerned about the short term and long term implications of the proposal by General Motors-Holden ‘s Pty Ltd that all its employees should take one week’s leave to solve the over-supply situation. It is extraordinary that the decision, which will affect not only the employees but also a multitude of smaller companies which supply GM-H with components, should be announced and dealt with with such insensitivity. I do not think anyone in this country believes that what is good for GM-H necessarily is good for Australia. I am certain that the other major motor vehicle manufacturers and motor vehicle assemblers must be extremely concerned by GM-H’s inept handling of a situation which could well be of its own making, helped in some part by the Australian Government’s inability to initiate and maintain economic recovery.

Whilst the company claims publicly that it has no ulterior motive in asking the employees to take one week’s enforced leave, it is a distinct possibility that the action is a planted weapon aimed at a number of things: Firstly, wrenching further sales tax reductions out of the Government; secondly, justifying a substantial price rise for its motor vehicles at the end of what it thought would be a wage-price freeze; thirdly, obtaining even greater protection for the Australian motor vehicle manufacturers and, in particular, General Motors; and, fourthly, putting back even further the introduction of stricter emission control standards for passenger motor vehicles. If the company believes that it can walk over the Government, the Opposition -

Senator Sim:

– That is easy.

Senator WRIEDT:

– . . . and, in fact, the trade unions and its employees and not attract adverse attention to both itself and the industry as a whole, it should think again. If Senator Sim thinks it is easy for the company to do that he will be answerable- presumably, he may answer later on- for some of the inactivity of his own Government in respect of this matter. The Australian motor vehicle manufacturing industry comprises 3 major firms- Ford Motor Co. of Australia Ltd, Chrysler Australia Ltd and

General Motors- together with a number of motor vehicle assemblers. There are 2 Japanese companies- the Toyota organisation and Nissan Motor Co. (Aust.) Pty Ltd, which are in the process of moving into the 4-cylinder passenger vehicle construction field. Every company involved is overseas owned. There has been no indication from any of them of attempting to sell a substantial slice of their equity on the Australian market. Chrysler has a small local equity of approximately 3 per cent. Australian Motor Industries Ltd has a much more significant equity of about 50 per cent, but of course it is essentially in the assemblage stage of the industry.

It is extremely doubtful that the industry as a whole wanted any action which would initiate a critical examination of itself and, in particular, the very high level of protection which is given to it. The insensitive approach by General Motors certainly will cause people- I would hope people on both sides of this Parliament- to examine critically the amount of protection given and the way in which it is given. At a time when the whole of the economy is going through some very painful adjustment processes, especially in the motor vehicle industry and at a time when industrial disputes have been reduced substantially, the action by General Motors is not to be treated lightly. The company’s general manager, Mr Chapman, must consider the Government, the Opposition and the unions to be pretty dull if he tries to convince any of us that 2 attempts to telephone the Minister for Employment and Industrial Relations (Mr Street) last Friday constitute adequate consultation. Anybody on the Government’s side who does not agree with that statement should consider the reply given by the Prime Minister (Mr Malcolm Fraser) yesterday when questioned on this point. The Prime Minister said:

Very late last week, I understand, General Motors sought by telephone to contact one or two Ministers, and there have been some discussions with the trade union movement. It would be the view of the Government that attempts to have those discussions on a proper and meaningful basis should certainly have been made considerably in advance of the action taken by General Motors.

It is quite evident that General Motors was not concerned with giving adequate notice either to the Government or to the trade union movement. Unless the board of General Motors acts out of concert with the rest of private industry, the decision must have been the subject of discussion at a management level and possibly of consultation with the management and board of the parent company in the United States prior to a final decision being taken on the proposal. The

Minister for Employment and Industrial Relations was in Canberra for most of last week. If he was unavailable by telephone, I am quite sure that an urgent telex to his office would have brought some response. Equally an urgent telex to the President of the Austraiian Council of Trade Unions and to the Vehicle Builders Employees Federation of Australia also would have brought some reaction.

The company also must have known that the Economic Consultative Group was meeting on Monday and that the matter could have been raised prior to or at least at that meeting. I am quite sure that there would have been a response from the Minister for Industry and Commerce (Senator Cotton) had that been the case. It is, therefore, not surprising that the Minister was critical, as was the union- in fact the union has reacted quite strongly- of the action taken by General Motors. As members of the union have pointed out, there is no assurance that had the workers taken a week’s forced holiday their jobs would be there for them when they returned.

We must consider the impact on the suppliers of component parts. These suppliers also will face the prospect of taking similar action to that taken by GM-H of laying off people. The decision will have a widespread multiplying effect throughout the whole of the Australian manufacturing sector. It is important to consider that, during 1976, General Motors paid out no less than $420m to the local supplying industry and that a shut-down of one week would in fact result in a loss or an accumulation of stocks of from $5m to $7m in that industry at a time when I am quite sure the Government would not wish to see that happen.

General Motors of course would claim that it has played a significant part in the development of the Australian motor vehicle building industry. That is true. The company had a substantial growth during the 1950s and the 1960s. It was part of a broad based development of the industry in Australia at that time. It should always be remembered that the company has undertaken those expansion programs with a considerable degree of protection and assistance. It would be safe to say that, had the company been left to operate in an open free market situation, it is highly unlikely that that growth would have taken place at anything like that rate. It is well worth remembering that the company’s initial period of formation resulted from a decision by the Chifley Labor Government in the 1 940s.

We must concede that the company’s return on funds has declined substantially since 1970.

Over a fairly lengthy period its return on shareholders’ funds has been substantially in excess of the average enjoyed by other sections of Australian industry. In addition its parent company has received substantial payments on dividends which have been remitted to the United States. Because of the amount of protection the industry receives, without which General Motors probably would not operate profitably, there is a strong obligation for the company to consult in a meaningful way with whatever government is in power. My colleague, Senator Button, will show at a later stage in this debate that the action as an industrial relations exercise is out of line with action which would have been taken in similar circumstances by other major motor vehicle manufacturers in the United States and probably, more particularly, in countries such as Japan and West Germany. In those countries an action of this nature would not have been contemplated. It is remiss, to say the least, for a major manufacturer in this country, foreignowned, to take the unilateral action which it has taken.

On previous occasions governments have moved to help the motor vehicle industry. In 1974 the Labor Government was approached by the manufacturers in somewhat different circumstances to the present ones. The Government of that day agreed to reduce sales tax from 27.5 per cent to 15 per cent in an attempt to help the industry clear its stocks. The circumstances of the current proposal by General Motors to shut down for a week give rise to the view that the company has now changed from being an initiator and a market leader, as it was during the immediate postwar period, to what can be seen only as a declining force in the Australian motor vehicle manufacturing industry. The existence of substantial stocks of unsold vehicles and the slowness of sales suggests that as General Motors is the only firm to make a shutdown proposal it has seriously misinterpreted market trends and has not produced, or is not producing, a range of vehicles which will attract the Australian consumer more than those produced by its competitors. The stocks on hand at General Motors appear to be in the medium-size car range. It may be that the company has failed to produce a vehicle which competes with similar sized and priced cars that are being produced by the other major competitors, Ford and Chrysler, and with imported units.

If Australian motor vehicles were marketed in the same way as they are in the United States General Motors’ solution to its present over supply position obviously would be a reduction in prices. It has been common practice in the United States for years for slow selling models to be heavily discounted. While some of the General Motors dealers may be forced into the position of having to do this themselves in order to get stocks down and take up future quotas almost enforced by the company it appears that the company itself does not believe in what may be termed the operation of the market forces which is an essential part of the free enterprise system. It is surprising that during the period of the alleged price-wage freeze, which obviously did not last any longer than it deserved to last, the Prime Minister (Mr Malcolm Fraser), who appears to be a very strong advocate of the free enterprise system, the market forces, has made no suggestion to GM-H that it should reduce its prices. Recent published figures show that although the company’s return on funds may not be as high as desired it is still operating at a substantial net profit and it would be possible to lower prices and absorb the short run losses. This would also, of course, have a desirable effect in helping to beat the inflation problem.

The company’s shutdown proposal must cause us to look carefully and critically at the present structure and marketing of Australian motor vehicle industry products. The present Government’s motor vehicle industry plan is an extension of that introduced by the previous Labor Government except that it is more restrictive, it has limited the competitive influence of imported vehicles and has probably given the motor vehicle manufacturers an over-optimistic view of the long term prospects for passenger cars in Australia. The protection given to the industry in the form of high tariff barriers, local content arrangements and import quotas works on an industry-wide basis. Unless the local content falls substantially there is no discrimination between the Australian manufacturers. The GM-H shutdown proposal forces the observation that if high levels of protection are to continue it may be desirable to establish a formula which allows protection to be given on the basis of each manufacturer’s performance or observation of certain pre-determined criteria rather than on the industry-wide basis. The company’s action also revives the detailed report on the passenger motor vehicle industry which was presented to the Labor Government by the Industries Assistance Commission in July 1974. The report made some blunt, pertinent observations about the structure of the industry in Australia. In summary, it was abundantly clear that Australia had too many motor vehicle manufacturers. The report said: of the four manufacturers and the three assemblers in Australia, only two achieved production volumes which are in any way comparable with those of even the smaller producers in the United States of America and Japan.

Of course, the Labor Government took a controversial decision to buy Leyland ‘s assets at Zetland in an attempt to rationalise the industry with a minimum of disruption to the company and its employees. However, that decision, along with the temporary reduction in sales tax, helped in the short run only. It did not assist in the long term rationalisation. In fact, some elements within the industry appear to have an ostrich-like attitude to the fact that the passenger motor vehicle manufacturing industry in this country is likely to be a substantial growth industry in the future.

Fuel costs, environmental considerations and the ever increasing costs of the vehicles themselves will mean that consumers will be unwilling to buy large vehicles or replace them as regularly. The projected market of Australian motor vehicles in the future, at between 612 000 and 640 000 to the year 1980, should now be seen as a ceiling. The IAC report again made this point:

The share of the market going to light vehicles is expected to increase from the present figure of about 47 per cent to about 56 per cent by 1980. Fuel price increases, which have become more apparent since 1974 will hasten that trend.

The Commission believed the shift would hasten structural change. The GM-H announcement highlights the necessity for the Government to grasp the nettle and sensibly assist the changes. Unfortunately, this Government has been unable to make up its mind about what policy it should adopt towards the restructuring of the industry. We had a debate in the Senate last week on the failure of the Government to produce the White Paper on Manufacturing Industry. That debate showed that there is great procrastination on the part of the Government and great hedging about the general question of manufacturing in Australia. If the Australian industry is restructured along the lines of the Swedish motor vehicle manufacturing industry with, perhaps, 2 major manufacturers which, presumably, would have close connections with other sections of manufacturing in this country, we may be able to reduce the possibility of future shutdowns of the type that GM-H contemplates at the moment. There has been a serious failure to tackle the industry’s problems. Again I refer to the Commission report. It stated:

The Commission considers that the unsatisfactory structure of the industry has evolved to a significant extent from the assistance policies of the last decade. The major assistance policies have taken the form of a high tariff, which has protected various segments of the industry against foreign competition, and local content plans which have further increased the level of assistance available.

Under a sensibly devised restructuring operation, the jobs of those GM-H workers who are now asked to take annual leave and the future of the components suppliers would be certain and would be known in advance. The obligation rests upon the Government to recognise the facts and to devise a program for structural alterations to this important industry. If the Government is prepared to allow itself and the trade unions involved in the industry to be treated with what can be described only as a display of contempt, it is showing lack of resolution. I trust it will exert all its pressures immediately on General Motors to get it to reverse its decision, which will remove the doubts placed over the heads of its employees and its suppliers. This is an action which only the Government can take. It has the authority to move swiftly to ensure that GM-H does not proceed with the proposals it has in hand. If GM-H is unwilling to change its mind, the Government must adopt an immediate program to restructure the industry to the benefit of the industry as a whole, not to one part of it.

Senator COTTON:
New South WalesMinister for Industry and Commerce · LP

– The speech by the Leader of the Opposition (Senator Wriedt) contained some useful material of which I have taken note, and which may be usefully discussed at a later date. It also contained some unreal propositions which he knows, as well as I do, are not capable of resolution or immediate implementation. That, I suppose, is to be regarded as the normal thing in a discussion such as this. I have one or two comments to make briefly about things he said before I turn to the general proposition referred to in the matter of urgency. He knows that there is more to the automotive industry in Australia than pure vehicle manufacturers. There are the people who make component parts. As I listened to him, he seemed to put a proposition that those people should be encouraged to go overseas. The components sector is extremely important. It has over 20 000 employees. It has a very high degree of Australian ownership. It is significantly catered for in the overall plan and in the local content part of it. I think his comment that most of the major manufacturers have little Australian equity is a fair comment. He would have noted that the 2 recent entrants have Australian equity in their structures.

If General Motors-Holden ‘s Pty Ltd were to reduce its overall sales position and were to cut production, as it may have to do, there would be a reduction in the component parts situation anyway. The Leader of the Opposition said that GM-H was a declining force. I do not think that is quite correct. One should note that its $150m investment program for expansion in the future is a clear indication of its intention to remain in the market, to be a force in the market and to overcome the problems that it certainly has. He talked about GM-H cutting the price of its motor cars out of its profits. As I understand the position, about 2.3 per cent return on sales really does not leave a lot of room. His observation about the behaviour of the company in the United States was perfectly valid. When I listened to his comment about the levels of protection to be applied on individual company performances, and different subsidies for different components, it seemed to me that this was a proposition for a totally alternative tariff structure. I think it is unconstitutional, but I will look at it as a proposition which I do not think has any great validity going for it. Nonetheless, it is ingenious. If it has been thought through, I should be glad to have the data. My impression is that somebody has thought it up off the top of his head in a moment of temporary madness. Let us look at GM-H’s earning performance. I refer to an article, which I commend to those who read the newspapers regularly, by Mr Kable in the Australian which states that renewed union claims that GM-H is still making very fat profits are no longer valid; the performance is not at all good; it has fallen on lean times.

I do not want to be involved in a process of what I call bashing people publicly, because there are other things to be done. The matter is a matter of importance; it is a matter of concern; it is a useful debate to have. We hear observations from time to time about the motor vehicle plan of the Australian Labor Party. There was not one. There was a lot of discussion and a lot of advice, and all kinds of directorial positions were taken, but there was not a plan. The plan finally emanated out of consultation with the industry. It was brought into reality in about June of last year, after discussions between the 5 major manufacturers and me. We met for the first time in Australian manufacturing history. We evolved the best plan we could for the circumstance. Nobody thought then or thinks now that it is perfect. It is the best solution that could be evolved. It is true that at the time we got an immense amount of bucketing by the Opposition on the 4-cylinder engine proposition. We were told that what we were doing was a disaster and that the whole thing would be no good. Since the 4-cylinder side of the operation was finally agreed upon by the various manufacturers, it seems to have gone along quite well. As far as I detect from the South Australian position, it seems to have been accepted quite well. Chrysler Australia Ltd is certainly showing confidence in the market by what it is doing. Therefore, I think one must regard to some extent a certain amount of the comments on matters such as this as not necessarily being fully valid or backed up by fact. The reality is that the situation is working out a great deal better than it was said it would in regard to that part of the proposed solution. The original solution was not adopted. A different solution was adopted. It appears to be working quite well.

I hope to have time to give some accurate figures. What we are looking at at the moment is certainly a flatter market for motor vehicles made in Australia and for motor vehicles imported into Australia than the industry has been expecting or predicting. Equally, we ought to be prepared to face up to the fact that the whole industry has been making solid investment plans, disclosing them and pursuing them. Those investment plans are moving down the road at a rate of capital expansion which, in a space of about 9 months, is about half as much as the whole of the industry did between the time of Mr Chifley ‘s beginning and the time that we became involved in the last year or so.

Senator Wriedt knows, and the figures disclose, that economic recovery in this country is clearly established. The figures are there on any test. The economic recovery is not necessarily involving the consumers at the moment in buying motor cars. The national account figures are there.

Senator Button:

– That is your opinion.

Senator COTTON:

– The honourable senator can get them. He is an accurate sort of chap. He knows that in 1975 the economy went downhill; in 1976 it climbed; it is climbing still. I think we ought to be saying to ourselves that the consumer choice is very important. The consumer choice that is evident today in the increasing Australian growth is a different consumer choice to that which occurred before. The consumers are buying fewer motor cars. They are doing more travelling. They are doing more entertaining. So the situation has those variables in it.

As observed very properly by Senator Wriedt, it is a free market. It is based upon an attempt to keep about 80 per cent of the market for the local manufacturers and about 20 per cent of it for those who want to import into this country. All sorts of things are talked about. All sorts of predictions are made. All sorts of people who generate troubles proceed to condemn those who try to solve the troubles. I was fascinated by the continuing predictions for the consumer price index figure for March. Most so-called authoritative commentators were freely predicting a rise in the rate of inflation. I do not know the sources from which they were getting their information. We were getting it heavily everywhere. They said it would be at least 4.1 per cent, maybe 4.4 per cent. They said that disaster was looming. If one picked up any journal for quite a while that was what one was getting. That of itself had a strong effect on consumer confidence and willingness to buy. The Department could produce graphs which show that as the inflationary trend comes down, household savings come down and consumer purchasing rises. They are clearly identifiable. They have a very distinct parallel. When the actual CPI figure came out, it was 2.3 per cent. It was evident that somebody had made a very grave miscalculation. Lots of people who gave advice, who made great predictions and who sounded off at regular intervals have been proved wrong. This is not to say that we believe we are infallible. One should be careful that one does not take too seriously these economic predictions. The CPI figure was very different from the predictions. The predictions, with their clatter and bang, had an effect on consumer confidence in Australia. All the figures which we have in the Department show that up clearly. That showed quite clearly in the Monday meeting of the Economic Consultative Group where we all talked about the predictions. In our view that was a reprehensible performance by those people who were proved to be so wrong. Various propositions were advanced including speculation that there ought to be a heavy reduction in sales tax. I say quite clearly that the Government has no such plan. That matter has been talked about for as long as I have been involved with the industry. There have been discussions about the level of sales tax and the need to reduce sales tax. All those matters have been talked about at industry advisory council meetings. They are not new matters.

The current situation is that that suggestion has been trotted out again. The Government has no such plan. I observe that one of the things which has shown up in the recent calculation has been the flatness of the Victorian motor car industry market. The industry has said that that position is due to the Victorian fuel disturbances. That is an interesting suggestion. It may well be true. What is certainly true at the moment is that the Australian market is extremely sensitive. Consumers are very shy. They react to the possibility of strikes and of high inflation. They are very sensitive. We have before us a motion in 3 parts. The first part states:

The community’s serious concern about General MotorsHolden ‘s proposal to enforce all employees to take one week’s leave.

The Prime Minister (Mr Malcolm Fraser), Mr Street, Mr Lynch and myself have expressed our concern about that circumstance and about the way in which it was brought about. The second part states:

The company’s failure to adequately consult the Australian Government and the trade unions in respect of the above.

Equally, that pan goes with the first part. Then, the third part states:

The urgent need for the Government to make firm decisions in respect of the industry.

If there is any value in this motion I suppose that is the part to which we should direct some attention. Two issues are involved- the action of General Motors-Holden ‘s and its situation and the position of the industry and the policy of the Government in relation to that position. In relation to the action of General Motors-Holden ‘s, yesterday in answer to a question without notice in another place the Prime Minister stated the Government’s position. I read the Prime Minister’s answer because it reflects very closely my position. He stated:

Very late last week, I understand, General Motors sought by telephone to contact one or two Ministers, and there have been some discussions with the trade union movement. It would be the view of the Government that attempts to have those discussions on a proper and meaningful basis should certainly have been made considerably in advance of the action taken by General Motors.

I made inquiries and was told that General Motors tried to get me on Friday but that I was not available. I was here all Friday and I was able to be contacted. I said to GM-H that it was preferable that I and the Government knew much more earlier of the situation. The company replied that it thought that might be the case and that there would be no repetition of this situation in the future. I said that I wanted the company to keep in touch with us and to let us have the information so that we could tell our colleagues and do what we could to help in the situation. The company undertook to do this. It has since done so.

The Prime Minister also drew attention to the fact that there was an industry situation and a General Motors situation. On 20 April the Prime Minister, myself, Mr Lynch, Mr Street and a couple of other Ministers met with the Federal

Chamber of Automotive Industries. All of the representatives were there. We had a long discussion. We had a graphical presentation of the position of the industry using a slide projector with comments. A GM-H representative was at the discussion. We talked about the market and about the industry’s problems. We talked about the import situation, the local content plan and all those things which Senator Wriedt has mentioned, plus a number of others. At that meeting the GM-H representative gave no indication whatsoever of the action the company subsequently took. I think it is fair to state these things. The company representative did not express disagreement with the views put by the industry as a whole on the market position. They were very different views to those now being expressed by GM-H. I do not take positions against companies or against unions. I have declined to do so. I have tried to deal with the factual situation as I see it and I have tried to help.

Joe Thompson and Len Townsend have made remarks about this matter. I have seen them both and talked to them both. Both of them have solid points in the arguments they make. I do not think they are totally correct but their viewpoints have to be taken seriously. I think the remarks of Joe Thompson about the need to update some of the equipment have quite a bit of validity. In fact, I have a table among all these papers which shows the comparative situation of output between the Ford company and GM-H. The number of vehicle units per employee in the case of Ford is 9. 1 but in the case of GM-H it is 7. 1 think in the case of a Japanese manufacturer it is something like 40-odd. These are comparative figures.

What is important to the community and to Parliament is to understand clearly that to use GM-H action as proof that the Government has taken no firm decision on this aspect of industry policy is quite unwarranted, untrue and totally against the facts. The one government which has taken action on the motor vehicle industry is this Government. Let us be fair about that. This is the Government which did that. The Opposition when it was in government talked about that. Some 12 months ago I announced that the Government had for the automotive industry a firm and settled policy which comprised a comprehensive package of assistance measures designed to ensure the development of a viable industry operating in the national interests. Let us not be in any doubt: I announced that. Let us not be in any doubt: A lot of questions were asked here about that. Let us not be in any doubt: Progressively that policy was developed with industry and others and it was exposed. The Government has had a lot of criticism but a lot of that criticism is now muted. The criticism today is based on that fact that the market is not as good as it was hoped it would be. The Government has gone further in the case of this industry than in most other industries. Senator Wriedt observed that and he is quite right. The industry has a substantial responsibility to the community and to those who work in it. There is no doubt that that is a correct and proper observation.

Two of the assistance measures which have been taken are unique, namely, the 85 per cent local content plan and making quite sure that about 80 per cent of the market is available for local car producers. We are committed to the policy decision to take action when necessary to ensure achievement of 80 per cent for the local manufacturers and 20 per cent for importers. Equally, we are watching very carefully the 85 per cent local content plan. Honourable senators may be aware that there is a committee which judges all applications to buy parts overseas as against buying them in Australia. Every factor is taken into account. The committee has an independent chairman. It has unionists on the board. It looks at various areas and if material is requested from overseas the cases are examined on the basis that the local supplier can put an argument, the importer can put an argument and the manufacturer can put an argument. So the committee’s hearings are conducted in a fairly honest and detached fashion.

For probably about a month the Department has been looking at the market position and at the downturn. It is expected that imports in the last few months have been running in excess of that 20 per cent figure but not all the market has been satisfied. Recent import figures do not reflect a normal situation because the effect of devaluation and the lifting of quotas last December are just working through into the market place. We need a much clearer picture of the market and of the import situation over a longer period before further action to restrain imports can be justified. It ought to be clearly stated that the import surge has come from European producers and not Japanese producers. It has been basically from the Volvo and Volkswagen areas where the companies manufacture a special vehicle for the Australian market. They have shipping programs accordingly and tend to ship in lumps. They then pick up the stock through progressive sales in the year.

The Government is in constant liaison with the industry in relation to local production, imports and the overall market position. We talked about the whole situation with industry representatives on 20 April. The Automotive Industries Advisory Council meets regularly to advise Government on industry problems. Because of developments in this matter I have asked the Council to meet again next Wednesday to talk about the industry position. I observe that the Industry Advisory Council consists of manufacturers of automotive vehicles, automotive parts manufacturers, the sellers of motor cars, the importers of motor cars, motor vehicle associations like the National Roads and Motorists Association, people from consumer associations and parliamentarians. We have 2 parliamentarians on the Council. One is from the Opposition, Mick Young, and one from the Government, Mr Bert Kelly, whom nobody can say is a great protectionist in our society. They are both valuable men because, with the unionists and everybody else on that Council, they will talk about the problems of the industry.

The debate dealing with the industry and its present situation as recorded in the Senate Hansard will be given to all the members at that meeting. So the golden word from Senator Wriedt, Senator Button, myself and others will be made available for posterity to them and, in due course, to the British Museum.

The Government is in a position to take action to ensure the achievement of its policies for the industry as soon as any particular circumstance based on true evidence and not on momentary pressure or noise warrants such action. Industry, including General Motors-Holden ‘s, has demonstrated its confidence in the effectiveness of the Government’s motor vehicle policy by its decisions to undertake massive investment programs. A new investment of at least $370m has been announced in the last 12 months, including an investment of $150m by General MotorsHolden ‘s and we are due to see more announcements of new investment in the future from people who obviously are prepared to back themselves down the long haul as this country’s economy gets better and better, as it certainly will. As for the present position, the General Motors-Holden ‘s problem does not seem to be shared by the rest of the industry. It seems to reflect difficulty in selling its main model in competition with other locally produced cars.

Reading carefully, the proposition which is contained in the urgency motion, it can be interpreted as suggesting that the community is expected to ask the Government to underwrite one company’s competitive position against other local producers. This is a market society; it is a free enterprise economy. One is free to do well and make money; one is also free to do badly. If what is expected is that everybody be guaranteed by the Government to do well all the time in respect of everything they do, I do not think we would have a free market economy at all. What is important, therefore, is the view that is taken of the market outlook for the industry as a whole for the rest of 1 977. Devaluation and the removal of import quotas late last year were expected by the industry tc, pull forward the sales of vehicles in the first quarter of 1977. Some consequent downturn in the market was expected by the industry and it so notified the Government in the second quarter of 1977. It is too early to say whether the April sales of passenger motor vehicles is the first sign of this expected temporary downturn or whether it represents a significant flattening of the market for the rest of the year. We will get a better view of the situation at the meeting of the Automotive Industry Advisory Council next Wednesday. We then will get a better view of the up-to date statistics.

Talking about the industry in general should remind us that in 1 970 or 1971 we had a motor vehicle manufacturing industry which was capable of exporting to world markets. In fact, 20 per cent of its output was exported to world markets. That figure has fallen to about 3 per cent because, as I have been saying again and again, our competitive situation for reasons well known to us all has worsened so markedly. The figures have been stated so often that they should be in effect carved on everybody’s back. The export market has fallen away and it is consequential in the current scene. So, at the Automotive Industry Advisory Council meeting next week, we will be looking for advice on the matters that we have been talking about today and seeking to determine how manufacturers of motor vehicles, importers, parts manufacturers, motor vehicle associations that look after the consumers, unionists, people involved in the Department and people involved in the Parliament collectively see the situation in truth. We will ask whether they see it quite clearly, what solutions they see and what they regard as a wise course of action. It is upon that type of advice that in due course I will go back to the Cabinet and say ‘This appears to be the truth. It appears to be the way things are moving. We recommend the following courses of action’.

So, we are monitoring the situation and, circumstances warranting, we will not hesitate to take action. The Opposition knows that and the industry knows it. That has been our position for quite some time. I should say one or two other things about the general comments on the way the situation is developing. One can get various factors put forward about the import situation. As it may well be that honourable senators later will want to talk about this subject, I repeat that I am dealing with a ratio of 80 per cent for local manufacture and 20 per cent for imported vehicles. That is the factor that we work to. It appears to the Government that imports are running very close to 20 per cent. Perhaps they are a little above or a little below. However, the following sorts of figures are those which confuse the scene. In the March quarter, landed imports comprised 25 per cent of total vehicles manufactured. Similar figures for March and December 1976 were 22 per cent and 22Vi per cent respectively. However, on a 12 month moving average, the basic tariff trigger calculation shows landed imports running at about 22 per cent. Then, there is a different set of calculations which are equally valid. They are derived from figures prepared by the ADAPS organisation and they come out at 18.7 per cent. What really matters is imports that are shown as a percentage of all registrations because, as I said earlier, there could be a lump of imports in the hands of stock holders being sold progressively through the year. So, a figure for 1, 2 or 3 months is nowhere near good enough.

We should be looking therefore at the following considerations: What is really the total shape of the market; what are the fair predictions to be made now in comparison with earlier predictions; has the situation moved away from the earlier predictions; to what extent is this basis to be regarded as reliable; can action be taken upon it? What Senator Wriedt said was quite right. There is heavy protection in this area to maintain Australian employment and activity and that does confer responsibilities upon those who benefit from it. However, the beneficiaries are not only the motor vehicle manufacturing companies but also the people who work in the industry, the people who become consumers because they are able to buy the products, the States of this Commonwealth which depend very greatly upon the stability of the motor vehicle industry for their own prosperity and look to the flow-on and the multiplier effects to be effective throughout their total industrial development. There is also a defence content involved.

There is a prospect that in due course from this position, by creating a stable base in the economy to ensure growth again and by getting cost competitiveness back into the scene through the investment programs and general restraints, we will get back into the export market. So, lying ahead of this industry is a great opportunity for those who are prepared to take risks, make investments and run their own businesses well. Governments representing the body of public interest, have a great stake in this industry, and it is not to be forgotten that although GM-H has been a large profit maker in the normally accepted sense, those profits should be related to the capital involved, the earning rate on sales, employment capacity, tax gathering and balance of payments surpluses because the industry was a big exporter in the days of cost advantage. Therefore, in taking a total view of the situation, we should not be too quick to bucket the people in the industry. They are going through a hard time. It has to be examined very critically. I have always found that it is dead easy to run someone else’s job from outside and that there is nobody better qualified to give advice than those who have never had their jobs or their capital at risk.

On the other hand, I say very fairly that I have had nothing but the best relationship with the unions in the industry. They have been constructive, helpful, forward-looking and many of the things which they have said in the past and now need to be borne seriously in mind. So we as a government are not in a static position and I as a Minister am not in a static position, I am concerned about this problem. I want to see it resolved. But it will best be resolved in an economy that is stable and growing, and with a cost structure in the industry which is realistic so that Australia can get back on its feet and once again have a bigger market, much of which will have to be in exports. A lot of this will be achieved by the changed approach that manufacturers will have to adopt, I am quite sure, towards what the consumer wants. In the end the industry depends upon what the consumer wants and will pay for. That ought never to be forgotten. The consumer in the end is the person who carries this operation. If he does not want to buy that motor car, he will not buy it. If he does not want to buy a motor car at all and decides to travel by some other means that is his free choice in a free society. Equally the operators in that free society, that market economy, have to take their risks if they want their opportunities and abilities realised.

Senator BUTTON:
Victoria

-The Senate is debating an urgency motion which was moved by the Opposition. It arises from a recent announcement by General Motors-Holden ‘s Pty Ltd of its intention to stand down some 18 000 workers for one week. When I use the expression stand down’, I mean in this instance that it is forcing workers to take a portion of their annual leave in May this year rather than at a time to be negotiated, which is the normal provision in most Australian industrial awards and the standard normally applicable to most Australian employees. Listening to Senator Cotton one became very aware of the limitations which are imposed upon parliamentarians in a debate of this kind. I suppose that because of particular circumstances which have arisen all of us are contributing to this debate on the basis of how best in a society such as ours one can contribute to the welfare of the motor car manufacturing industry, the employees engaged in it and the companies engaged in it. I suppose that in a week or two when we are perhaps discussing the energy crisis or the Australian environment it will be brought to our attention by contributors to those debates that the motor car is not necessarily the greatest benefaction that has been inflicted on Australian society. At that time we might be putting quite different points of view about the future of the motor car industry.

I think it is a fact, as Senator Wriedt acknowledged in an earlier speech, that governments of various political persuasions have had difficulty in facing up to this problem. The difficulties are very real, as Senator Cotton pointed out, because of the numbers of employees involved and the capital involved. But at some stage we will have to face up to those difficulties. In saying that sort of thing, Senator Wriedt did not say, as Senator Cotton alleged he said, that the Opposition was advocating a reduction in sales tax.

Senator Cotton:

– I did not say that. I did not mean to.

Senator Wriedt:

– You gave that impression.

Senator Cotton:

– I meant the industry. I apologise if I gave that impression.

Senator BUTTON:

– I accept that the honourable senator did not say that, but listening to his contribution I perceived that he said that and I may well have been wrong. The present problem arises because of a recent announcement by General Motors-Holden ‘s. It was a unilateral decision of the company made without consultation with government or with the trade unions. The reason given for that decision by General Motors-Holden ‘s was that it wanted to clear its unsold stocks of cars. The ultimate reason, of course, is that the company wants to maintain, at the expense of whoever happens to suffer, its current levels of profitability. The sorts of propositions which the company puts forward in support of its action are of extremely doubtful validity when one looks at them in terms of public interest, of business or of the consumers in Australian society.

According to the figures published in relation to the December quarter, General MotorsHolden ‘s had 23.8 per cent of the Australian car market. The Ford Motor Company of Australia Ltd had 23.1 per cent of the Australian car market. To its credit, Ford has not seen it necessary to embark upon a similar course in relation to its employees as that embarked upon by General Motors-Holden ‘s. The unofficial figures for March show that GM-H secured 25.96 per cent of the total number of vehicles sold. That figure was not as good as the March figure for the previous year, but March of this year was a had month, as Senator Cotton has acknowledged, for all manufacturers in the motor industry, and particularly for Toyota and Datsun, which have not seen fit to take the same course as General Motors. A spokesman for Chrysler Australia said recently:

The market is down in April. But we have no plans to cut production, or to lay off workers.

One would think that that is a more responsible attitude that the attitude adopted by General Motors. The Managing Director of the Toyota assembler, Australian Motor Industries, said:

The market is down but the situation is not drastic. I don’t want despondency fed into the public’s minds. We should be encouraging more confidence and spending.

General Motors does not seem to care whether despondency is fed into the public’s mind and it does not seem to care whether despondency is fed into the minds of workers it employs in the industry. These are the sorts of considerations which have led the Opposition to raise the matter in the Parliament today. Let me refer to one other statistic from the Australian Statisticians Office. That statistic, published in the newspapers on 30 April this year, confirms the figures which I just gave relating to the share of the market which those respective companies had.

It was on the basis of specious arguments such as those advanced by General Motors, such as wanting to get rid of its unsold cars- I use the word ‘specious’ in terms of public interest in this country- that the company proceeded to inform its employees that they would take a compulsory week’s holiday in May this year. As I said, other companies do not seem to see that as being necessary. The effect on employees in terms of social and family disruption is of course quite considerable, but the point which has to be made is whether in the free market society in which Senator Cotton believes we live, companies should be able to operate to the detriment of the social welfare of individuals employed in an industry such as this and should be able to behave in the manner in which this company has behaved. Such behaviour has a highly disruptive effect on employees and a considerable effect in terms of employment and social insecurity. It is contrary to all the industrial relations principles which have been advocated by the responsible industrial relations bodies in this society since the turn of the century, that an employer should take unilateral unannounced action of this kind in relation to its employees. A company which has taken so much by way of profits out of this country should in turn have a greater sense of responsibility towards the people who live here and towards the people who work for it if it wishes to continue to take out that level of profit.

As I said, Senator Cotton referred to the free market economy- ‘private enterprise’ as it is sometimes called. But what about public responsibility? I heard today about a company which is retrenching employees, many of whom have had years and years of service, and as part of the negotiations regarding retrenchment it is offering those employees $100 a year until they are eligible for the age pension. That is the sort of sense of public responsibility which some companies in this country have. Does General Motors-Holden ‘s have the same sort of sense of public responsibility towards its employees? The attitude of the Government on this matter is simply reflected in the words of the Prime Minister (Mr Malcolm Fraser) when he said that the company should have consulted the Government and the unions before it adopted this course. That was a mild admonishment from the Prime Minister. Since we are talking about the motor industry I am reminded that when the first motor cars appeared on the road a gentleman always walked in front of the motor car waving a flag to warn how dangerous it was. I suggest that the Government should adopt a similar course in relation to its industrial relations policies and have somebody walking in front warning how dangerous those policies are for this country if it continues to pursue them in the present way.

There is a degree of double standard in the Government’s attitude which can be seen in the mild admonishment of General Motors for the action which has been taken and in the Government’s threats day after day against the trade unions for embarking upon exactly the same free market enterprise course of conduct in which General Motors is indulging. General Motors said: ‘You will not work because we want to make bigger profits’. The trade unions have said: We will not work because we want to make bigger profits in terms of wages.’ It is quite clear where our respective sympathies lie when we consider the share of the wealth which each of those corporations has in the total scene in Australia. Those on the Government side undoubtly have sympathy for General Motors. Most of us on this side perhaps have sympathy for the trade union movement when we consider the share of wealth which each of those sectors of society enjoys. It is exactly the same sort of thing. The Government hands out uneven treatment. It mildly admonishes General Motors but makes threats of an industrial relations bureau and of savage amendments to the trade practices legislation to deal with industrial disputes by trade unions.

Senator Cotton referred to the statement which he made in March last year relating to the future of the motor car industry. In one passage he said:

It is the desire of the Government to ensure that necessary changes in the industry are brought about in a way that can be sustained by the economy. The Government’s policy has been developed to ensure change occurs in a manageable and controlled manner.

I do not know whether he regards the action of General Motors-Holden ‘s Pty Ltd as a manageable and controllable manner of dealing with an industrial situation in Australia and of dealing with a human situation. One could talk about the free enterprise society in which we live. Senator Cotton talked about it but his colleague, the Attorney-General (Mr Ellicott), apparently does not agree with him very much. Only last weekend Mr Ellicott, addressing the Australian Society of Senior Executives in relation to the role of the public corporation, said: a corporation was vigorous and performing its true role in a free society if it ‘reacts to the needs of society, is responsive to its consumers and innovative in its products, is self-reliant and maintains high ethical standards in its business relationships.

He did not cite General Motors-Holden ‘s as an example of a body which failed to live up to those standards, although it is one of the biggest corporations in this country. He stated further:

On the other hand a corporation that has to be goaded into action or pushed into submission or disciplined by government regulations, that takes no account of social needs until told to do so is anathema to a free society.

I repeat that: ‘ . . . anathema to a free society’. That is why we have moved this motion today. The sort of conduct in which General Motors is now engaging is anathema to a free society if it continues to be subjected to the same double standard which the Government hands out and continues to behave like a dinosaur in the context of a free market without any regard to the public interest or the welfare of its employees.

We are concerned about the question of double standands and are concerned about the particular conduct of a particular company. It is all very well, of course, to talk about the responsibilities of corporations, as Mr Ellicott did. Trade unions are corporations which have responsibilities to society as a whole. They do not always carry them out. Companies like General Motors also are corporations which have responsibilities to society as a whole. They very rarely carry them out and they should be continually reminded that those responsibilities exist. It is for those reasons and not ibr any profound reason about the future of the motor car industry- about which we all ought to be concerned on a nonparty basis if we are really concerned about the public interest in this country- that we support the motion which has been moved by my colleague, Senator Wriedt. I commend the motion to the Senate.

Senator JESSOP:
South Australia

– The motion before the Senate concerns everyone in this chamber. I think it is proper to draw to the attention of the Senate the plight of the motor vehicle industry. I disagree with Senator Button that honourable senators on this side of the chamber have sympathies with General MotorsHolden ‘s Pty Ltd and that the sympathies of honourable senators opposite lie with the trade union movement. Our view has always been that the Government Parties are concerned with the welfare of the whole of the community. Senator Button pointed to our attitude to industrial unrest in Australia. I think it is quite proper that any responsible government should take action to minimise industrial disputation and to deal with a minor group of militant union officials who have, in many instances, been imported from overseas and trained overseas in disrupting industry. There has been reference to the Central Intelligence Agency. I can imagine that many of these trade union officials would be under the influence of the KGB. I ask honourable senators to think about that.

As far as honourable senators on this side of the chamber are concerned, the Government and the Minister for Industry and Commerce (Senator Cotton), in particular, acted very quickly- far more quickly, of course, than the Labor Party- with respect to the motor car industry. Through the Minister the Government’s long term policies were laid down on 30 March 1976, not long after we came into Government. The objective of our policy is to develop an economic and efficient industry with a high Australian content, operating under levels of protection which are acceptable to the Australian community. We have enunciated the policy through the Minister on previous occasions.

I certainly recognise the significance and importance of the motor vehicle industry, particularly to South Australia. According to the latest figures that I have been able to obtainpossibly honourable senators may have even more up to date figures than I have but my figures will serve to illustrate this particular point- in relation to the motor vehicle industry and motor vehicle parts industry in South Australia, at the end of 1973-74 there were 109 establishments employing 20 061 males and 2547 females, a total workforce of 22 608. They were being paid salaries to the tune of $ 140m a year. The turnover at that time in South Australia was nearly $500m. Opening stock valuation at July 1973 was $70m and, at the close of June 1974, was $94m

Since those days the motor vehicle industry has come into fairly rough waters. I do not entirely absolve the industry from blame. As a matter of fact, I have had many consultations with the industry. I brought up the matter of market planning. I asked why they had been making so many 8-cylinder cars and so many medium sized cars when the trend obviously was towards the smaller motor vehicle. This trend will continue. I certainly do not absolve the industry from blame in that area. I noticed that Senator Gietzelt is nodding his head in agreement. Nevertheless, we have to recognise that General Motors, in particular, has a peculiar problem compared with other parts of the motor vehicle industry. This is illustrated in the Financial Review today. It refers to the General dropping its colours to Ford. It notice that the vehicle units per employee at the Ford Motor Co. in Australia are 9.1, but at General Motors-Holden ‘s vehicle units per employee are only seven. There is obviously something wrong in the overall long term planning of General Motors-Holden ‘s if those figures are true.

I think General Motors has quite properly employed the services of the motor industry analysts, ADAPS, which was referred to by the Minister. ADAPS foreshadowed that worse things will come. Bearing in mind that the world oil shortage is becoming increasingly acute and that the cost of oil and petrol will undoubtedly rise, I would think that the motor car industry is entering into a period of radical change and that it may not be too long before we will be driving around not in 4-cylinder cars but perhaps even 2- stroke cars, which will come into fashion.

Perhaps in the far distant future the horse and buggy will find favour in the world market place.

One aspect that must be looked at by the motor car industry is the need to provide research and development- I know this is happening but it ought to be happening to a greater extent- into steam car development and into electric car development. I noticed that at question time yesterday my colleague, Senator Missen, asked the Minister whether the Government would consider providing funds for research and development into a Victorian steam car project. I took up the cudgels with the Government on behalf of an Adelaide inventor who is also developing a steam car. The Flinders University requires funds to support its electric car development. This is a very interesting vehicle which has a battery operated motor which propels a small vehicle. I do not think the University is prepared to divulge the extent of its research at the present time but I understand that at present this vehicle can probably travel at about 50 miles an hour for about 40 or 50 miles, but that has to be improved. I am quite confident that the motor industry in Australia could help in that regard by redoubling its efforts to find some way out of its problems in the long term. The Opposition has implied that the Government has been fairly soft in respect of General Motors. Let me quote the statement made by Mr Street as reported in the Canberra Times oil May:

The Federal Minister Tor Employment and Industrial Relations, Mr Street, said in Bathurst on Saturday that it was very regettable and very disturbing’ that GM-H had acted without consultation with the Government.

Mr Street said the matter would be discussed at a regular meeting of the Government’s economic consultative group tomorrow.

Senator Cotton has already referred to that meeting at which he was present and which dealt with the problems that arose unexpectedly as far as the Government is concerned. In answer to questions on 3 May in the House of Representatives the Prime Minister said : it ought to be said at the outset that in advising the Government of the current state of the industry- there were eight or ten representatives of the industry, including General Motors-Holden ‘s Pty Ltd present on that occasion, on 20 April- nobody raised the problems that General Motors has since learned about and has since been experiencing.

He went on to say:

It is clear that there is an industry situation at the moment and a General Motors situation.

I referred to that earlier. If the industry itself is at fault in market planning- the figures I cited from the Australian Financial Review indicate that the vehicle unit output per employee for Ford is 9. 1 and for GM-H is 7- then perhaps some serious rethinking has to be done by General Motors. We have to look at the first part of the Opposition’s motion, which reads:

  1. The community’s serious concern about General Motors-Holden ‘s proposal to enforce all employees to take one week’s leave;

Opposition supporters seem to be paranoid about multi-national companies. They seem to be paranoid about any section of the industry making a profit. I would like to remind the Opposition that multi-national companies are also multi-million employers. They employ millions of people in Australia and those employees are multi-million dollar taxpayers into the Government’s coffers. I would suggest that at this time when the country is faced with tremendous unemployment difficulties, that have undoubtedly been caused by the previous Administration, this Government is taking this matter very, very seriously and doing what it can to restrain public sector expenditure to encourage the private sector to develop. Not the least of our concern is the motor industry. The Minister in answer to a question on the radio program AM, I think, said that he was in constant touch with the unions, and in constant touch with the motor vehicle industry. In my opinion- and I think it is reasonable to suggest that the majority of people in Australia would share the view- it is far better to suggest to employees that they have a week’s leave rather than face possible retrenchment.

I think perhaps the way the announcement was made left the trade union movement floundering. Perhaps the company was not as diplomatic as it should have been in respect of proper consultation with the Government and the unions. I would suggest that the lesson has been learned; if it has not, it should have been learned. The Government certainly, according to what the Minister has said, is not entirely in agreement with what has happened, in fact far from it. But I am certainly happy with the way in which the Minister is approaching the matter and the way in which the Prime Minister is dealing with it. I believe that with continued close co-operation and close consultation with not only the employers but also the trade union movement, and with some sympathy in respect of the problems they are facing, we will be able to overcome this very serious dilemma in which they find themselves at the present time. I congratulate the Minister on what he is doing. I will give him my full support to assist him to overcome this very serious problem.

Senator GIETZELT:
New South Wales

– I rise in this debate because I am concerned not only with the present issue of a week ‘s stand-down of” workers by the management of General Motors-Holden ‘s Pty Ltd but also with the practices of the multi-national companies throughout the Australian economy. Therefore, I find myself very much in conflict with some of the remarks of Senator Jessop. It might be regarded as unusual that I, as shadow Minister for Agriculture, should in 2 weeks running be involved in a debate about the problems facing manufacturing industry. I find myself in complete agreement with an increasing number of spokesmen of farm organisations who believe that the future of agriculture in Australia depends upon a prosperous domestic market, recognising as they do that about 50 per cent of all that we produce is consumed on the domestic market and that any downturn in any sector of the economy therefore affects the prosperity not only of the whole economy but the rural sector in particular. Therefore there is a need for full employment and a prosperous economy. I believe that the greater part of the present economic ills facing this country arose from the unrestricted, unsupervised and unknown activities of the multi-national corporations in our economy.

In my contribution today I intend to look at both the immediate issue at hand and the role of one of those multi-nationals- GM-H- in our economy. The announcement of the management of GM-H that was splashed across the newspapers on 30 April stunned most people. It read:

The sudden drop in the market has left the company with uneconomically high stocks, finished vehicles and components in hand. As a result, the company is seeking through union officials the co-operation of production employees and production-related employees at all plants to take one week of their 1977 annual leave entitlement in advance ‘.

If Senator Jessop has any illusions about community concern, I suggest he look at the various editorials as well as comments by leaders of his own party because there is genuine concern in the Australian community about what is happening to the motor industry and to GM-H in particular. In effect, the 16 000 blue collar workers have been asked to take leave coinciding with the May school vacation. They have been given just a brief fortnight’s notice. As in most similar situations the management has seen fit to apply this policy only to the blue collar workers. The 8000 white collar workers employed by GM-H have not been requested or directed to take enforced leave. Thus, immediately upon reading this announcement I was struck by the elitist bias. Again, as in 1961 when the credit squeeze had its effects on car sales GM-H has concentrated its cost saving measures upon the blue collar workers. As an example of GM-H tactics, in 1961 a large number of blue collar workers were retrenched bringing the numbers employed back to the 1958 level of approximately 1 8 500 employees. Once again we see the management of GM-H, when faced with an adverse economic situation, which may or may not be of a temporary nature, immediately rushing to relieve an economic burden at the expense of its work force- the blue collar workers.

Understandably, the unions involved rejected the proposals. Although the GM-H management has said that the proposal was necessary to avoid retrenchments, during discussions with the unions on 2 May it would not give any assurance to the unions that if the stand-down was agreed to by the unions there would be no retrenchments. In other words, the management is prepared to enter into a public relations exercise about avoiding retrenchments but will make no agreements to refrain from retrenchment action. Again, the management has taken a biased and anti-employee stance. Fortunately, this roughshod and elitist proposal has met uniform opposition. Several Premiers and the Government have expressed regret and consternation at this proposal. One Premier made what I believe to be a telling point when he suggested that a compulsory holiday was a common practice in the United States of America to meet overproduction problems, but was a most unusual measure to adopt in Australia. I shall return to this later in my remarks.

At this point I should like to review the background to this latest proposal by the GM-H management. We must see this decision against a background of GM-H stability and ownership. As honourable senators no doubt are aware, GM-H was established through the merger of 2 companies in 1931. The original paid up capital was split between $1,120,000 Australian-owned capital and $1,930,000 United States-owned capital. In 1959 and 1960 all Australian-owned equity was purchased by the parent company, General Motors, for a total of $1,960,000. Since that date GM-H has been a totally-owned subsidiary of the giant United States multi-national corporation. It is very interesting to note a report in today’s newspaper to the effect that in the first quarter of this year, 1977, General Motors in the United States returned a profit of $903m.

If the company has been aggressive to its work force in times of trouble, it has been no less aggressive in its maintenance of being fully owned by the United States parent company. In fact, in 1945 during the discussions with the Government concerning a Holden car project Mr Laurence Hartnett, the Managing Director of GM-H, made it clear that the United States parent company was not going to spend a cent of United States finance on this project. The General Motors finance committee told Mr Hartnett:

We ‘re not going to spend one cent of United States money on this. If GM-H wants a car, it will have to find all the cash for it in Australia.

As is well known, the Chifley Government, in response to this attitude, raised $6m from the Commonwealth Bank and the Bank of Adelaide. If the parent company, General Motors, was most unenthusiastic in providing initial development capital, it has received considerable dividends from its Australian operation. It must have been received with some enthusiasm because from 1 948 to 1 976 the parent company received in dividends from GM-H in Australia $373,216,000. I should like the approval of the Senate to table a document which shows the net profit after tax of General Motors-Holden’s Pty Ltd in Australia. In the years 1948 to 1976 it accumulated profits of $592,495,000 and in the same period paid to the parent company the sum of $373,2 1 6,000, to which I just referred.

The ACTING DEPUTY PRESIDENT Senator Devitt)- Are you seeking leave, Senator, to incorporate that document in Hansard ?

Senator GIETZELT:

– Yes, Mr Acting Deputy President.

The ACTING DEPUTY PRESIDENT-Is leave granted? There being no objection, leave is granted.

The document read as follows-

Senator GIETZELT:

– Whilst this is a considerable amount of money to be paid to the parent company- in real terms it is far greater than $373m- the parent company also has received other payments. The Prices Justification Tribunal report on General Motors-Holden’s dated 21 December 1973 referred to other payments to the United States parent company. The report stated:

Certain payments have been made for specialised sources and the like and in addition considerable transactions have taken place between General Motors-Holden’s Pty. Ltd. and the American company and overseas subsidiaries by way of export and import trade.

Just how much these extra payments to the parent company have been worth is not publicly known. In the 23 August Prices Justification Tribunal report on GM-H the Australian Council of Trade Unions advocate, Mr Jolly, is reported to have made the following clear statement:

Much of the information furnished to the Tribunal in a confidential exhibit should be made available for public examination.

The ACTU representative later made reference to the fact that many companies, including GM-H, failed to produce consistent technical data over a considerable period of time. I raise this point because I believe these transfer pricing arrangements to be widely practised not only by GM-H but also by many other multi-nationals in Australia. In an extensive work in support of American investment in Australia, Donald T. Brash referred to these devices to avoid taxation and stated:

The writer is aware of at least two companies which commenced payment of a substantial service fee in 1 962 after the Australian Uniform Companies Act compelled many foreign companies to disclose their profits for the first time, and payment of large service fees is certainly one reason why American-owned companies can sometimes appear to pursue conservative dividend policies. One firm, for example, with an admittedly conservative dividend policy, pays ‘engineering fees’ equal to Vh per cent on the sale of all American-designed products, and these fees are ‘annually more than five times the size of the biggest dividend ever remitted by us to the U.S.’. Another firm refrained from declaring any dividend for more than a decade after it commenced manufacture in Australia, but has paid a service fee, now equivalent to about 7 per cent of sales revenue, since establishment. In 1962 the American parent of this company received substantially more from this fee than it did from the dividend of the Australian firm.

There is no other way to describe it: A great amount of fiddling with the books by accountants employed by multi-national corporations is taking place in this country. It is certain that we must consider measures to terminate this type of tax avoidance which, in effect, is a rip-off of all Australians. As I said, in the case of GM-H we have little knowledge of exactly how much Australians have lost in taxes. That is shrouded in secrecy and hidden in often meaningless compilations of the company’s public relations exercises, such as the GM-H advertisement on 18 January 1975. The GM-H company is not alone in adopting this strategy of tax avoidance and in adopting the following philosophy outlined by the authors of the book Global Reach:

Minimising local profits is often an essential public relations strategy.

One could discuss these points in considerable detail. However, 2 points in relation to GM-H are perfectly clear: Firstly, its tendency to make the work force bear the brunt of economic problems and, secondly, it has paid a massive dividend to the overseas parent- a dividend which, if one took into account special payments and applied a current value analysis, must exceed $ 1,000m. Yet the company attempts to put the current economic burdens on those workers who produce the value of the goods in its factories in this country.

In recent times GM-H has claimed that it has come upon severe economic times. Its market share has dropped from 39.3 per cent in 1956 to 25.9 per cent in 1976. This has occurred due to a number of factors, including the rise of Japanese investment and sales in the market. Other factors have included increasingly out of date design and over-production. Further, the rapid escalation of the purchase price of automobiles has tended to reduce the number of people prepared to make such large outlays.

In the current circumstances a cut in sales tax has been advocated by both the unions concerned and the GM-H management. There is little doubt that the 27.5 per cent sales tax on vehicles is excessive. It must be remembered that high levels of sales tax were introduced as a means to limit demand inflation. It certainly was not intended as a long term measure. It compares most unfavourably with the 6 per cent sales tax applicable in the United States, for example. The Government should consider a cut in sales tax to stimulate sales. The statement by the Treasurer, Mr Lynch, to the effect that sales cuts are ‘not on ‘ is again an example of intransigence and a failure to initiate action to improve the economy and to prevent loss of jobs. Whilst there is a good case for such a stimulatory move, I am of the belief also that there is evidence of misjudgment by the GM-H management. The current shortfall of 9000 vehicles unsold compared with the figures for the same period last year appears to have been due to a miscalculation on projected sales. GM-H production appears to have been based on the record car sales in the industry during 1976 in which 602 000 vehicles were sold.

Finally I turn to some of the more long term problems of the industry. In recent months several companies have announced plans for major expansions. The Toyota organisation, the Nissen Motor Co. (Aust.) Pty Ltd, the Ford Motor Co. of Australia and even GM-H have announced expansion plans. We have to keep in mind that these companies have little or no Australian equity. In the case of the Toyota expansion, Australians will have only a 5 per cent share. This expansion of foreign ownership increases the now generally recognised trend for more and more decisions affecting the Australian economy to be made in the boardrooms of New York, Tokyo, London and other capitals. Economic journals such as Syntec have raised this problem. This must have effects on the ability of any Australian government to make necessary long term plans and structural adjustments in this industry.

Secondly, 2 major interrelated problems will have to be met in the industry and by the Government in making long term policy decisions. These are, firstly, the question of import competition and, secondly, the move by Australian consumers towards smaller less polluting and less energy using vehicles. Both these points relate to quotas, expansion and Australian content decisions which must be made by the Government. The decisions will not be made in response to panic moves by companies such as GM-H. The decisions will have to be made taking into account structural problems such as unemployment and the increasing world trend towards greater trade between nations. Yet I stress that, if structural adjustments need to be made in the near future, they must be made in the full awareness of the necessity to institute full Government programs to avoid and to avert social problems that almost certainly will arise. If a decision means less jobs in an industry, the workers must be provided with full retraining and placement in new jobs. I support the motion moved so ably by Senator Wriedt.

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

Senator YOUNG:
South Australia

– Once again the Senate has listened to an attack by Senator Gietzelt on multi-national corporations. It is a fascinating exercise. On how many occasions do we hear various members of the Opposition attacking the multi-national corporations? Senator Gietzelt ‘s attack centred to a great extent on the motor industry and particularly General Motors-Holden ‘s Pty Ltd. I remind the Senate that General Motors came to Australia during the reign of a Labor Government. Under Mr Chifley, it was firmly established here. It then was what Senator Gietzelt would call a multi-national corporation. It has, along with other motor industries in Australia, made a big contribution to this country particularly in the areas of employment and the economy. One could go further and say that the whole of the motor industry within Australia is multi-national.

What are these companies doing for the country at present? How many people do these companies employ? How much other industry is involved indirectly through these various companies? As a South Australian I ask: How much is my own State leaning upon the motor industry for employment and for its economy. One gets rather tired of hearing the continual criticism and denigration of what the Opposition refers to as multi-national corporations. Without overseas investment and initiatives in this country Australia would not have had the progressive and overall development that has taken place since the 1939-45 war in particular. The motor industry played a large part in this development. When General Motors- it is now known as General Motors-Holden ‘s- sought to establish a motor industry in Australia, why did not the Labor Party seek to set up that industry itself? The reason simply is that we did not have the expertise or the capital. The Labor Party Government went overseas to encourage a company to come here and to establish a motor vehicle industry in Australia. Since then we have seen an expansion by other companies- multi-nationals -to establish further motor industries within Australia. There are problems today. This debate is concerned with the economic situation within General Motors-Holden ‘s which has a surplus of motor vehicles and with the employment of those who are working within the organisation.

For a long time there has been a change in consumer demand for motor vehicles in Australia. There has been a tendency to move to smaller vehicles. This trend has continued. The motor industry, like any other industry, is reliant upon the wishes or whims- call it what we like- of consumer demand. But, today, because of the cost for the initial outlay of a motor vehicle, fuel consumption, insurance, depreciation etc. there is and will be a continuing demand for smaller motor vehicles in Australia. Of course as time goes on and the energy shortage develops we will see greater encouragement for this tendency in Australia. I am afraid that not enough people in this country are really aware of the crude oil situation in Australia.

Let me look at the crude oil situation if the present rate of consumption continues. At present Australia is supplying something like 70 per cent of its own requirements of indigenous crude oil. But by the year 1985, unless further finds are made or unless there are increases in the price of crude oil, we will see our current reserves go down to approximately 30 per cent. That is not a good position to be in when we have to rely more and more on imports of overseas crude at far higher prices.

We have seen inroads into our Australian markets particularly from the Japanese with their smaller cars. They have made their inroads because they have met the market and the demand of the people within this country. We have also seen some of our own Australian companies step fairly quickly into this area to meet the demand for smaller cars. I refer particularly to the market foresight of Chrysler Australia Ltd which fairly early in the piece introduced within its range some smaller cars which have sold very well because of the demand for such types of vehicles.

There has been much criticism today of General Motors-Holden ‘s. But let us be fair. We have listened to a tirade today from Senator Gietzelt. But General Motors-Holden ‘s, along with the other companies in the motor industry, has played an important part to assist in the development of secondary industry in Australia. It has been a big revenue earner. It also has been a great employer of labour. I refer not only to GM-H but also to Chrysler and Ford which have established themselves here. Since then the Toyota and Datsun companies also have established in Australia.

Market changes or consumer demand, as I have said, change the pattern considerably. Styles and desires of people have changed as has the demand for particular types of cars. Whereas GM-H for a long time was the leader in the supplies of Australian made vehicles, we find a progressive decline in its share of the market. In 1974-75, GM-H held 23.9 per cent of the Australian market, Ford held 20.7 per cent and Chrysler had some 9.7 per cent. By 1975-76 GM-H still had 26. 1 per cent of the market whilst Ford held 22.2 per cent and Chrysler some 9.6 per cent. In December 1976 the share of the market held by GM-H declined to some 24.2 per cent while Ford ‘s share had increased to 23.5 per cent and Chrysler’s share had dropped to some 8.6 percent.

It is interesting to see from these figures how GM-H to some extent has tended to misjudge the market. There is no doubt that the present concern within GM-H and the factors which are being debated here today arise from the fact that, in anticipation of consumer demand, the company has misjudged the market. It is interesting to note that whilst the demand for GM-H products is down at present, figures for Chrysler Australia show that that company has improved from a previous position of 8.6 per cent of the Australian market in the March quarter to 9.5 per cent, even though, as has been said today, indicators show that Chrysler sales, along with other motor firm sales, will be down when we see the April figures. Much of this, no doubt, is due to the Victorian fuel strike which affected sales in that State considerably.

There are other aspects such as the concern of people at present to see what happens about the wage freeze. But whilst the percentage of sales by GM-H has declined there has been an increase in Chrysler sales. There was a lot of criticism today from Senator Gietzelt about the profits of these various so-called multi-national corporations. It is interesting to see the figures for the Ford company from 1 972 to 1 976. That company has gone from a net profit after tax of $ 15m in 1972 to a net profit of $22m in 1976. During the same period the profit of GM-H went from $ 15.3m in 1 972 to $ 1 7.9m in 1 975. In 1 976 the profit fell to $ 16.3m which was a drop of 8.5 per cent. It is also interesting to consider exports. In 1973 export sales were standing at approximately 41 000 units. In 1975 they dropped from 41 000 to 7500 units. In 1976 they held at about the same figure. I shall refer again later to that particular aspect.

I want to refer quickly to comments made by Senator Gietzelt. He talked about multi-national corporations making huge profits in this country. Let us look at some of the figures for Chrysler Australia, a company which employs a terrific number of people within this country and which still intends to expand because it has confidence in the country. In 1972 Chrysler showed a loss of nearly $4m. In 1973 and 1974 it showed a profit. In 1 975 it showed a loss in excess of $ 1 m. In 1 976 it showed a loss of $2.1 m, a loss that was related to a terrific outlay of millions of dollars. It is all very well for Opposition Senators to stand in this place and scream about companies when they make a profit. Do they cry any tears in this place or express any sympathy for a company with multi-millions invested when it shows a loss? No, they do not.

I now turn to GM-H itself. Reference has been made to the vast profits of GM-H this year. In real terms, the profits work out to be a return of 4 1/2 per cent on invested capital of $364m. This is what it is all about. I ask Opposition senators today whether they would be prepared to put their savings in an investment that will return 4Vi per cent. Of course they would not. They would go down the street elsewhere. Nor would they invest in a firm that guaranteed them 10 per cent this year with a risk that there would be a loss next year. They would not be in it. It is all very well for them to stand here with their crocodile tears and criticisms of multinational corporations. A lot is involved in investment in this country for companies such as GM-H with a huge amount of investment capital and risk capital tied up.

Concern has been expressed today because GM-H has a surplus of vehicles which, at present, it is unable to sell. No doubt much of this is due to the fact that it has misjudged the market. The company proposes to stand down many of its employees with a week ‘s leave on full pay. I support what the Prime Minister (Mr Malcolm Fraser) said in relation to this proposal. In the House of Representatives Hansard of 3 May he said:

It would be the view of the Government that attempts to have those discussions on a proper and meaningful basis should certainly have been made considerably in advance of the action taken by General Motors.

I support that statement. It is most important, always, to have consultation and communication. That has been the Government’s policy. Comments have been made by the General Manager of General Motors-Holden ‘s Pty Ltd in relation to the great expansion that is taking place in the motor industry. I understand that by 1980 GM-H intends to have expanded its investment by approximately $150m. In all some $500m will be invested by the motor industry in this country. I refer to GM-H, Ford, Chrysler, Datsun and Toyota. My overall concern is that even with the great expansion that is taking place within the 5 motor vehicle manufacturers in this country we must get back into the exporting field in which we once exported 20 per cent of our production. Today the figure is down to 3 per cent purely because of the costs involved and the lack of competition with overseas competitors. Unless we return to our former position, Australia’s motor industry will not be in a very pretty position.

Vast investments have been made by the motor industries in this country and they are prepared to expand because of their confidence in the country. I suggest, however, that there has to be an increase in productivity if those industries are to survive effectively. They must turn to exports. We cannot afford to see our exports drop from 20 per cent to 3 per cent. There is a need to upgrade this figure and return to an export level of 20 per cent if we are to maintain a viable motor industry in this country. I do not support the detail of much of what has been said by the Opposition today but I express my concern for the motor industry at present and the workers who are in an invidious position because of the fear of unemployment in the short term.

Senator James McClelland:
NEW SOUTH WALES · ALP

– I recall that in the days of the Eisenhower presidency in the United States there was a man named Charles Wilson who had been the General Manager of General Motors in the United States. President Eisenhower made him Secretary for Commerce. He delivered himself of a statement which became the laughing stock of the United States when he said: ‘What is good for General Motors is good for the United States.’ This was a classical assumption of the parallel interests of this giant corporation and the interests of the American people; nearly as fatuous, I suggest, as the now notorious statement of our Prime Minister (Mr Malcolm Fraser) that life was not meant to be easy. Certainly we could not have said this week that what is good for GM-H is good for Australia.

As most of the speakers, whether for or against this motion, have pointed out, the main fault is that of GM-H itself. Not only has it been unimaginative in misreading the market and not understanding that the world-wide fuel shortage would make the trend toward smaller cars more imperative; it has also, as has been pointed out this week by one of the union officials involved, neglected the investment of new capital in its plant in Australia. It is almost as though this wealthy family, centred on the United States, is treating GM-H in Australia as some sort of a poor relation. The figures tell their own story. I am more bewildered every day by what we have come to expect from Senator Cotton when he stands up and says that all the economic indicators point towards fair weather ahead for this country. We are getting from the market place quite different noises specifically to what we got from GM-H this week.

Senator Young quoted some figures. I think Senator Jessop gave some figures a little earlier. The stark picture of what has happened to GM-H in recent years is told by its sales figures. I will give them in round figures. In 1973 GM-H sold 205 000 vehicles; in 1974 it sold 190 000 vehicles; in 1975 it sold 164 000 vehicles; and in 1976 it sold 157 000 vehicles. The most significant factor in the last figure is that only 7500 GM-H vehicles were sold overseas. It has almost lost its capacity to compete in world markets. It is down to 65 per cent or 67 per cent of its capacity. The figure which was given, I think by Senator Jessop, and which I think is probably the most significant when we deal with efficiency or look for a yardstick of productivity, was the number of vehicle units per employee produced by GM-H. It is only seven, compared with 9.1 for the Ford Motor Co. of Australia. This points to a lack of efficient plant, to a lack of modernisation of the enterprise and perhaps to too diversified a siting of the various plants. It was said this week, I think quite truly, by Mr Thompson, one of the union officials who is very familiar with the operations of GM-H and the other motor manufacturers, that obsolete capital equipment was to blame for GM-H’s economic problems. He named Pagewood in New South Wales, on the outskirts of Sydney, as the worst of its 8 Australian plants. He accused the company of spending as little as possible on modernising its capital equipment so it could send its profits overseas. He said there was very little capital replacement. He said there was no automatic spray painting equipment in Australia. At the General Motors plant at Lordstown, Ohio, 3 people could spray 103 cars an hour, using automatic equipment. In Australia this has to be done with many more men, by hand, thus adding to labour costs. He said there was no automatic spot-welding equipment in Australia.

It has become fashionable not only for our opponents but also for the media to ascribe all the shortcomings of Australian productivity to the work force, without pointing to where the true blame lies. It is no accident, as I have pointed out previously, that Japanese automobile workers and American automobile workers are paid as much as or more than Australian automobile workers, but they produce many more units per worker. That is because their plants are more efficiently conducted.

Senator TEHAN:
VICTORIA · NCP

– With less labour in those countries.

Senator James McClelland:
NEW SOUTH WALES · ALP

– It is also due to some factors beyond our control. It is due to economies of scale. Many pundits in this country allege that we should not have an automobile industry, that from the beginning we were doomed to be inefficient because we did not have the advantages of economies of scale which make German automobiles, Japanese automobiles and American automobiles cheaper and better than Australian automobiles. One even sees that reflected in the local market. For the short period that I was Minister for Manufacturing Industry the problems of the automobile industry were my problems. I must say that I was glad to get rid of them. I am glad that Senator Cotton has them now. It always struck me as one of the most ironic things in the short period that I was Minister that when I went to these automobile plants the people who worked in these plants owned Japanese cars. That struck me more forcibly than anything else. The automobile workers who worked for GM-H, Ford or

Chrysler Australia Ltd expressed their consumer preference, in many cases, by buying a Datsun or a Toyota. In other words, the real problem of GM-H in Australia is due to the fact that it has been unimaginative and it has grown increasingly inefficient. To point towards the unionists in these plants or to the fuel crisis in Victoria as some sort of explanation for the falling off in the sales of vehicles is to fly in the face of reality. Aggravating the problem is the fact, which Senator Cotton and every speaker on the other side neglect, that the real reason why as many cars are not being sold this April as last April is that the recession, which is blamed on us, is continuing to deepen. It is expected that sales this May will be worse than sales last May. I do not want to talk down the economy, but the reason that fewer people are buying cars is that fewer people have any confidence that the economy will pick up. It is getting a little late in the day for our opponents to blame all this on us. It is a fair while since we were in office. If the Government has some clues, it is about time it showed them to us.

What happened this week with GM-H disturbs me more as a symptom of the continuing recession than as the event itself. The Government will not face up to the fact that large numbers of motor cars are not being sold. It gives me no pleasure to say this. I do not believe that for us to gain political advantage things should get worse. I hope they get better, no matter who is running the country. We will not get anywhere by pretending that these problems do not exist. There is a 2-fold answer to the continuing problem of the inability of GM-H and, I fear, perhaps the other car manufacturers to sell their vehicles. Firstly, we do not have the advantage of economies of scale. Secondly, the industry, for all the capital that has been put into it, is undercapitalised. That is obvious. That is admitted by the companies. They have plans for increased capital expenditure, but we must go through this slump first because of their inefficiency, because of their unimaginativeness, because they have not read the market correctly and because of the continuing and, I fear, deepening recession.

I hope it does not turn out that GM-H, alone among the local manufacturers, may have seen the trend ahead. I hope we will not see something like this happen with Ford and Chrysler. The fact is that people do not have confidence. Many of them do not have any money. This is why they are not buying cars. It is of no service to this community for the Minister to say: ‘We have it all under control. Labor did not do anything about the motor car industry, but we will. We have a plan. The indicators show an upturn in the economy’. The signs and the signals we get from the market place are such as those which we got from GM-H this week. The problem will not just go away. It is no good the Minister pretending, in the sort of Panglossian mood that he has, that everything will be for the best in the best of all possible worlds, merely because we have a conservative government. It is a rather more difficult problem than that. Without attempting in any way to suggest that the Labor Party was faultless, we are getting a little impatient for the magical cures that we were promised during the traumatic days at the end of 1975. What is wrong with the motor car industry is a combination of factors. People are not buying cars primarily because there is no consumer confidence in the country. We are told that we would get consumer confidence. I hope the problem will not get worse. I fear that it will not go away, as the Minister thinks it will.

Senator TEHAN:
VICTORIA · NCP

-The Senate has before it today yet another matter of urgency. This seems to be the tactic of the Opposition on days on which the proceedings of” the Senate are broadcast. I do not think a Wednesday goes by without this happening. This motion, like those which have gone before it, seeks to lay at the door of the Government the blame for a situation which, while it is a matter of deep concern to the Government and to everyone in the Senate, has not been contributed to or caused by any initiative or policy of the Government. As I understand the function of urgency motions, they are an opportunity for the Opposition to probe the Government over some shortcoming in policy, perhaps where the Government has over-reacted or under-reacted where the policy of the Government may be proved to be defective.

Although we have listened to a number of speeches we have heard very little of the solution to the real problems of the industry. Particularly we have heard very little from the Opposition of any solution which the Government can offer to the motor car industry in its present plight. One would have thought that there would be some constructive suggestions from the Opposition in a debate of this kind if it had any initiatives which it could suggest to the Government in the present situation. Of course the present problem of the motor car industry which we are discussing today concerns the suggestion by General MotorsHolden ‘s Pty Ltd about its employees. Senator Gietzelt has reminded us that the matter involves the blue collar employees. I did not understand that that was the situation. I thought it involved the standing down of everyone. But we are told that there is a distinction between the blue collar and white collar workers. This is one of the distinctions which Senator Gietzelt never hesitates to make. The employees are to be asked to take a week’s holiday. Primarily, that is a matter between the company and its employees. It is a domestic matter and one in which the Government, in my submission, should not intervene. Senator Gietzelt was at great pains to indicate his phobia, if I may use that term, of multi-national companies. I refer him to an article in today’s Australian by Mike Kable. I think the article has already been referred to by the Minister for Industry and Commerce, Senator Cotton. In that article this passage appears:

So the frequent union bashing about profitability which has become a traditional national pastime against GM-H, the biggest of the big multi-nationals, is scarcely credible these days.

The truth is that the company is experiencing a tight situation because of the falling off in demand for its product. It is a private enterprise and it has competitors. They have been named as Chrysler Australia Ltd, Ford Motor Co. of Australia Ltd, and now the Toyota and Datsun companies. It is a very competitive field and one in which a company has to be on the alert in an economy like we have in Australia with high labour costs. We all know that wages escalated 57 per cent in 1974. That, of course, is one of the great problems of secondary industry in Australia today where there is a high labour content. The problems are accentuated in the motor car industry where there is a high capital content.

I briefly refer to some remarks made by Senator James McClelland. He said that there was a falling off in sales and that the recession would continue to deepen. I remind him that the record shows that sales for December were 63 000 and that that was a record for all time. So what is being exhibited at the moment is a falling off after the record in December. I think the industry recognises that its problems are in the short term, although in the case of GM-H a great number of factors enter into the matter. I think that some of its problems stem from the introduction of the more stringent emission control specifications on 1 July last year when, under the Australian design rule, anti-pollution emission control devices had to be fitted to motor cars. It is fairly common knowledge in the market place that GM-H did not grapple sufficiently with the problem. The result is that in certain circumstances consumers, who in Australia are discerning people, have found that when they put GM-H products alongside Ford and other competitors, the GM-H products fall short. I think this is one of the factors. I am not saying it is the major factor or the sole factor but it is one factor which has not been mentioned in the debate and which may be vital to the problems of GM-H. The motion today, like ancient Gaul is divided into 3 parts. The first part of this matter of urgency states:

The community’s serious concern about General MotorsHolden ‘s proposal to enforce all employees to take one week’s leave.

We share the concern of the community at the request of GM-H that its employees should take a week’s leave. But I suggest that it is hardly the province of the Government to intervene in the situation. I have already stated that we have heard no suggestion from the Opposition as to initiatives the Government might take to correct the position. All this paragraph does is to express the serious concern of the community about the proposals to enforce all employees to take a week’s leave. What the Government can or should do about the matter has not been stated by the Opposition. I have already said, and I repeat, that we are all concerned about the proposal but surely it is a matter which in the last analysis must be left to the company and its employees to solve. As I understand the position, the company has made the suggestion to the employees concerned that this is perhaps a better initiative and in the employees’ overall interest instead of making selective retrenchments at a time when there is over-production and some stagnation in community demand for a variety of reasons which I have already instanced.

I think in fairness to the company, and having regard to the more drastic consequences for the employees whose services would be dispensed with under the latter proposal, the first proposal is more desirable and less severe to all concerned. Generally speaking, I think that if the workers were given an opportunity to speak they would take the option of a week’s leave instead of the more drastic step of some of their mates and colleagues in the industry suffering retrenchments. The motor car industry, like many other private enterprise industries, is one of keen competition. General Motors-Holden ‘s forms part of the local market. If the Government were to be persuaded to take some initiative to support that company what would be the position of Chrysler, Ford and the 2 Japanese companies? They would be on the doorstep looking for a similar handout. The truth is that these companies and GM-H had announced some expansion plans which is an indication that the company is in a short-term recession and so is the industry. We have the problem of a small population. Probably we are producing more motor cars in the long term than we should be for our population and market. Senator Young has dealt in detail with the position in relation to the decline in the export market. I think that in answer to the first part of the motion we can say that it is hoped that the proposal, if implemented by the company, will allow sales to catch up with production and, certainly, that the problem will be one of short term duration for the reasons I have stated. The second part of the motion reads:

The company’s failure to adequately consult the Australian Government and the trade unions in respect of the above.

Sitting suspended from 6 to 8 p.m.

Senator TEHAN:
VICTORIA · NCP

– When the sitting of the Senate was suspended, I was dealing with the second paragraph of the urgency motion moved by the Opposition. Before going on with that aspect again, I take up a point which Senator James McClelland made and which I omitted to deal with earlier when touching on what he had to say. He mentioned that in the United States of America through an automation process, although he did not use that term, 3 people with sophisticated plant can do a spraying operation which in the Australian industry would involve some hundreds of workers. He said that one of the problems in the industry was the failure of General Motors-Holden ‘s to update its plant. It is rather novel that a member of the Opposition of Senator James McClelland ‘s standing should advocate a reduction in the work force in the times in which we are now living in Australia. To use an Australian phrase, I wonder how fair dinkum the Opposition is in that regard because it cannot have it both ways. Either we believe in automation and reduction in labour or we do not. As the Opposition has put its policy, I had understood that it was diametrically opposed to automation. At all events no one, least of all the workers who are listening to this broadcast, would want to see automation introduced in the motor car industry.

The second paragraph of the urgency motion deals with the company’s failure to consult adequately. We are not here to spend the time of the Senate debating whether GM-H adequately consulted the Australian Government and the trade unions in respect of its proposal. Our Government’s policy is to allow the private enterprise sector as far as possible and within proper limits -

Senator Colston:

– To flounder along.

Senator TEHAN:
VICTORIA · NCP

-. . . to exercise its own initiative in decision-making and policy, Senator Colston, and it is difficult to see on the face of the present situation what the Government could have suggested had the company had greater consultation with it. We concede that we should have been consulted, as the Prime Minister said in the other place yesterday in reply to a question suggesting that the company should properly have consulted the Government. But the company did not and that is it; and it is no fault of the Government that it was not consulted.

Opposition speakers have had something to say about consultation with the trade unions. We on this side of the chamber always support initiatives which allow employers and employees to get together and discuss their problems. But we recognise that the final decision so far as the company’s financial future is concerned rests with the company because in private enterprise if a company does not make a profit it goes broke. Private enterprise does not have the luxury of government which can run enterprises at a loss for an indefinite period. Companies are concerned to remain viable. In these days of high production costs, particularly in respect of labour, it is the concern of all manufacturers and producers to monitor expenditure and sales to ensure that their operation remains viable. In that context we recognise the desirability of employer companies consulting with trade unions on the various problems which will inevitably arise in the present tight economic situation. It is difficult to see why the Government should be saddled with the sins and shortcomings of this company or of any other company because that company failed to consult with the trade unions in a particular situation.

In the few moments I have left, I turn to the third paragraph of the urgency motion which refers to:

The urgent need for the Government to make firm decisions in respect of the industry.

The Minister for Industry and Commerce (Senator Cotton) set out in a statement made some time ago what the Government’s longterm proposals for the industry were. What the Minister had to say was this:

The development of a long term policy for the motor vehicle industry was one of the Government’s first tasks on coming into office.

Senator Cotton, announced the Government’s long term policy on 30 March 1976. The statement continued:

This followed a comprehensive review of all aspects of motor vehicle policy, including extensive consultations with the industry.

The objective of our policy is to develop an economic and efficient industry with high Australian content operating under levels of protection which are acceptable to the Australian community. We recognise, however, the conflict between the objective of an economic and efficient industry and that of high Australian content.

Time does not permit me to proceed further with that statement. All I want to say now is that the Government has answered whatever challenge the Opposition has made in its urgency motion. We deplore the situation where workers must take a week’s leave in an industry such as the motor vehicle industry. But it is not the fault of the Government that this situation has arisen. I take it that wise counsel between the employer and the employees will see a solution to what I hope is a short-term problem.

Senator CAVANAGH:
South Australia

– This has been a remarkable debate. The fact that an urgency motion was moved indicates that the Opposition sees some urgency in and has some vital concern for the important question that has recently arisen following the proposal by General Motors-Holden ‘s Pty Limited to force all employees to take a week’s annual leave at a time other than when they were scheduled to take or would normally take annual leave, allowing the employees very little time to make arrangements for the enjoyment of that leave solely because General Motors-Holden ‘s has produced cars in excess of its sales capability. For the purpose of clearing already manufactured cars it wants a cessation of manufacture for a period of 10 days in the hope that, in that period, it can dispose of the cars it now has in stock and after that period can continue production. Among the remarkable contributions to this debate was the speech of the previous speaker, Senator Tehan, who said that this is a matter that should be resolved by the workers and employer getting together. He said that the Government believes in consultation between employers and employees.

It was only last week, in effect giving 3 week’s notice, that the management gave this ultimatum to the employees. They were not told that this move should solve the problem but that failure to accept the company’s proposal could lead to the redundancy and dismissal of up to 1000 employees in the motor body building industry, although acceptance of the proposal would be no guarantee that there would not be dismissals following the break. It is not so much a question of a week’s leave being taken at a time when that leave is not desired by employees as it is a question of the uncertainty in this industry. Like Senator Young who spoke earlier, I also coming from South Australia which is not one of the larger manufacturing States but which relies solely upon motor body building, feel deep concern about this problem. South Australia has Holdens and Chrysler-Dodge -

Senator Steele Hall:

– Not solely.

Senator CAVANAGH:

– Mostly. We are building the majority of motor bodies for the motor industry. Other than General Motors-Holden ‘s which has factories at Woodville and Elizabeth, and Chrysler which is at Tonsley Park, we have scattered around the metropolitan many firms who are supplying components for the motor body industry in Australia. Any recession in this industry is more dramatic in a State where the opportunities for alternative employment are not as great as they would be in the larger manufacturing States. It causes us deep concern to see the main industry in a State, due to a surplus of cars, being unable to continue production and unable to maintain full employment for the workers at the factory. I have some interest in this matter. I live in the vicinity of the Holden factory. A great number of my neighbours are employees of General Motors-Holden ‘s at Woodville. From conversations with them I find that they are uncertain about their future as employees of General Motors-Holden ‘s and so they maintain the ‘bombs’ that they have by working on them every weekend- those cars get them to work and home again during the week- instead of investing in another car, which they might do if they had that security. I am a former employee of Holden ‘s Motor Body Builders Ltd, which was the forerunner of General Motors-Holden ‘s. I am a former employee of T. J. Richards and Sons Ltd, which was the forerunner of ChryslerDodge in South Australia.

Senator Steele Hall:

– That makes you unique.

Senator CAVANAGH:

-Yes, they did not keep me for long and I did not contribute much to the profits of those multi-national companies. That is my history. I have a great interest in the motor body building industry in South Australia. While the South Australian Government is the only State government granting money to make work available for the unemployed and doing its utmost to solve the unemployment position there is the threat of another 1000 people coming on to the labour market in that state.

I think that the Minister for Industry and Commerce (Senator Cotton) was very fair about this matter. The main problem is that Holden ‘s are not supplying a product which is acceptable to the consumer today. It appears from the fact that overall sales are dropping that the company is not producing an article which is finding the ready market which its competitors are finding. If the problem is one of models or of extras on vehicles, then there is no solution at this time because the company is trying to get rid of the models that are already made. Therefore we have to find another solution to the question of why people will not buy Holden cars in preference to other cars of that type and price. As the type cannot be altered there is only one solution: The price must be reduced. Whether the solution is for Holden ‘s to reduce the price and make the vehicles more attractive to the community- according to Senator Gietzelt ‘s figures in relation to multi-national corporations the company is capable of doing that- or whether the solution is to reduce the sales tax on motor vehicles, is one of the problems that should be sorted out by the Government.

The Opposition’s urgency motion points out that there is an urgent need for the Government to make firm decisions in respect of the industry. At the present time, because of the uncertainty, there is a reluctance by people to purchase. It is not only those employed in the motor industry who are uncertain but also those employed in other industries. In his contribution to this debate the Minister assured us that economic recovery has been achieved, yet every month we see increased unemployment. The Government justifies it by saying that it is not as bad as one would expect for this time of the year. The Government has ceased to produce the figures of seasonally adjusted unemployment and so we cannot compare the figures. Whilst the Government is carrying on a campaign and saying that recovery is just around the corner we know for a fact that there is greater unemployment now than there has been since the depression days. Whether recovery is here or not, there is still uncertainty and people are not purchasing at the present time.

It is no solution to the problem of those employed in the motor industry to increase the sales of Holden cars, which would mean increased production and perhaps more job opportunities for those employed by General Motors-Holden ‘s Pty Ltd, to the detriment of another car manufacturer because this would result in fewer employment opportunities for those employed by other manufacturers such as Chrysler-Dodge. We must analyse the situation. We must determine whether we are producing cars in excess of the demand, whether we should re-organise the industry into the manufacture of some other product, or whether we should employ Australians and impose greater restrictions upon the importation of foreign cars. They are the matters that we have to consider. I am concerned because within the last 2 days the Minister, in his speech to the economic conference arranged by the Newcastle University and held at Terrigal in New South Wales, said amongst other things that he has been criticised for not producing a White Paper on manufacturing industries but that the Government wants it to be perfect and to carry into 1981. While he is concerned about the perfection of the document which he will produce in order to solve all the problems of the manufacturing industry we find 1000 workers faced with redundancy in an industry that is crying out for Government intervention and Government assistance to save it.

Senator Tehan said that the Opposition has not put forward any proposals. It is not the duty of the Opposition to say and it would not be acceptable for the Opposition to say what is the solution to this question. The problem must be analysed and a solution found. I have just received a copy of the periodical produced by the Committee for Economic Development of Australia entitled A CEDA Study-The Motor Vehicle and Component Industry. After going through the history of the industry in Australia the Committee came to the following conclusion: it seems necessary to provide the following conditions for the maintenance of a local vehicle and parts manufacturing industry:

Local content in vehicles of more than 85 per cent; -

That is the content at the present time according to the statement made by the Minister in March-

Restrictions of cbu imports through duties and, if necessary, quantitative restrictions, to contain imports to a level below 20 per cent, -

That is the permissible level at the present time- preferably 10 percent:

Continuation of local content plan past 1984.

I am not putting that forward as a solution to the whole problem. The matter is crying out for some study, some consideration and some solution. Those of us on this side of the chamber are appealing to the Government to do something. Apart from the Minister’s speech, we have heard nothing from the other side but a condemnation of the trade union movement and its activities in the past. There has never been an industry with fewer disputes or greater co-operation between management and unions than the motor body building industry. It is true that General MotorsHolden’s Pty Ltd at Elizabeth has had some stoppages as a result of actions of some metal trades workers. We cannot blame the unions. General Motors-Holden’s has not been a good employer as Senator Young said it was. It wrongfully dismissed an employee. The Industrial Court found that it was a wrongful dismissal and rather than re-employ him, General MotorsHolden’s appealed twice to the Supreme Court and once to the High Court but did not get satisfaction. According to our law of justice it was found to be a wrongful dismissal but the company would not take him back until all avenues in law were explored, simply for the purpose of keeping the man involved unemployed. This is the penny-pinching attitude of a company that has been dominant in this industry during the whole of its existence in Australia. I submit that this matter is crying out for government consideration, a government plan, and a government policy to ensure the security of employees in this industry.

Senator LEWIS:
Victoria

-The urgency motion being debated this evening is in 3 parts. Whilst I can accept the second part, I cannot agree with the first part and I cannot agree with the imputation in the third part. The first paragraph deals with the community’s serious concern about the General Motors-Holden’s Pty Ltd proposal to force all employees to take one week’s leave. I cannot agree that the community would be seriously concerned about that as a proposal. I think the community would agree that that is not an unreasonable proposal, especially with the school holidays occurring during the month in which it is proposed the leave be taken. I am sure most members of the community would agree that it is better than being stood down. I think that certainly there are matters of concern to the public. In fact, the matter raised in paragraph 2 of the motion would certainly be a matter of concern to the public. It states:

The company’s failure to adequately consult the Australian Government and the trade unions in respect of the above . . .

All parties to this debate today, the Prime Minister (Mr Malcolm Fraser) and Government supporters in the other House have agreed with this part of the urgency motion. General Motors clearly has had opportunities to consult the Government but it has failed to do so. I do believe that is a matter of very grave concern.

The other matter which I think would be of grave concern to the public is the question of misjudgment which seems to have been agreed upon by practically all parties to this debate today. It would appear that suddenly General MotorsHolden’s had discovered that it is no longer making a motor car which is wanted by the public. Some years ago the Ford Motor Co. of

Australia and Chrysler Australia Ltd discovered the same thing. Since then, both companies have tried to produce a car which is wanted by the public. Ford appears to have succeeded. Of course, it has not had much opposition. For far too long Australians have had to put up with motor cars with poor handling characteristics; which are unsafe at any speed in a moment of crisis; which are especially fast on the open highways and especially dangerous on our open highways; and designed to race from one set of traffic lights to another set of traffic lights at high speed and to come to a sudden halt. On an open highway our cars need to be able to do far more than that. Many Australians have decided that they will suffer this situation no longer and have opted to pay somewhat outrageous prices for imported European cars which handle the way all motor cars should handle. Since the appointment of Mr Chapman from General Motors-Holden ‘s in Germany as Managing Director of General Motors-Holden ‘s in Australia, that company appears to have recognised its disabilities because it has now produced new models- at this stage only of their smaller cars- which are especially advertised as ‘handling like a European car’. I refer to the advertisement for a Holden Sunbird which states:

New Sunbird is here!

Now you can get economy and the equipment of imported cars, plus exceptional handling . . .

Senator Keeffe:

– What sort of car do you drive?

Senator LEWIS:

-I drive a 1968 BMW car which is 9 years old and has done 120 000 miles. It has done them very well, on long distances throughout Victoria. It is a very good motor car. I submit that this advertisment is in itself an admission that the handling of other Holden motor cars is abominable.

Senator O’Byrne:

– Abominable?

Senator LEWIS:

– Yes, abominable. It seems to me that General Motors-Holden ‘s has misjudged the market, in particular for its larger cars the Holden and the Statesman. It has been estimated that there are about 10 000 of these cars in stock. It would take seven or eight weeks of new car registrations to clear those cars- not one week. I ask: What is the motive of General Motors-Holden ‘s in taking this action? In 1975, under a Labor Government, this company threatened to dismiss 5000 people and it succeeded in having the sales tax level reduced from 2 7 1/2 per cent to 15 per cent. If that is its motive this time, it will not succeed because this Government will not reduce its sales tax because it is concerned about inflation. Some honourable senators opposite would push for a reduction in sales tax because they know that it would increase the Government’s deficit and increase inflation. I ask honourable senators opposite whether they have an interest in keeping inflation as high as possible.

Let us examine the benefits which this industry receives. It has a 45 per cent tariff advantage and in July 1974, the Industries Assistance Commission recommended that the tariff advantage should be only 25 per cent. This is an effective subsidy of $4,000 a year for each car worker. The industry has an assured 80 per cent of the domestic market and, from time to time, quotas have been used to ensure that. Last December’s devaluation increased the landed price of imported vehicles by 2 1 per cent. Since then, of course, that has been reduced by revaluations. I submit that this Government has done all that could be expected of it to assist the motor car industry. General Motors-Holden ‘s appears to have been unable to take advantage of it. One can draw one’s own conclusions about that. I reject part 3 of the urgency motion which states:

The urgent need for the Government to make firm decisions in respect of the industry.

It has made those decisions and it is carrying them out. I should like to raise one final and vital point which does not appear to have come out in this debate. This point, in my book, will cause the community great concern. Once again union leaders in this country have opted for retrenchment of their own workers rather than adopt some form of co-operation. The people of Australia will recognise what the union leaders have done in these circumstances. Clearly, in my opinion, the unions leaders have a vested interest in political disruption and in keeping unemployment in Australia as high as possible.

Senator McLAREN:
South Australia

– We are debating an urgency motion which was moved by the Leader of the Opposition in the Senate (Senator Wriedt). I should like to bring the debate back to what we are actually talking about by referring to the motion, which contains 3 parts and which states:

  1. The community’s serious concern about General Motors-Holden ‘s proposal to enforce all employees to take one week’s leave;
  2. The company’s failure to adequately consult the Australian Government and the trade unions in respect of the above; and
  3. The urgent need for the Government to make firm decisions in respect of the industry.

There has been almost unanimous agreement among speakers from the other side with the second part of the urgency motion that we have put forward which reads:

The Company’s failure to adequately consult with the Australian Government . . .

We heard Senator Cotton say today that he had been at a meeting with leaders of the motor industry, particularly General Motors-Holden’s Pty Ltd, just a few days before GM-H made this announcement but the company had not breathed a word of it to the Government. Yet we are told that this is the Government that has the confidence of manufacturing industries throughout this community. This is a perfect illustration of an instance in which there was no confidence shown, asked for or given. Now the jobs of many thousands of workers employed by GM-H in this country are in jeopardy. We have heard speakers from the other side of the chamber almost unanimously, as they always do, portray the multi-nationals as fairy godfathers to the Australian community. I say here and now that these multi-nationals have never entered into any business venture in Australia without an eye to the profit to be made out of the venture. In short, profit is the main consideration of the multinationals, not the welfare of this nation. We should not let Government supporters try to fool the people of this nation that the multi-nationals ever invest their capital in this country because they are concerned with the welfare of workers and the people who live here. The only reason they ever come here is that they see they can make a profit out of their investments. They do not take any risks; of course they do not. When they get into trouble, what do they do? They do the same as Government supporters do: They blame the working class.

We should perhaps go back over the history of General Motors-Holden’s. I was very fortunate today in my research to come up with an article from which I want to quote. It is printed in a newsletter called Retrieval: Newsletter of Current Events, No. 23, February/March 1975. Under the heading ‘Transport: The Decline of the Motor Car?’ the article gives the history of General Motors. It is very interesting to read how it came into this country to manufacture a motor car in the first place. This article states:

General Motors-Holden was set up in Australia, from the merging of two previous companies, in 1931. The paid up capital of this company then was: Australian owned, 51,120,000; U.S. owned, $1,930,000. In 1959 and 1960, General Motors in the U.S. bought up all the Australian shares, for a price of $ 1 ,960,000.

Honourable senators can see that for an extra $30,000 General Motors was able to buy up all of the Australian shares which in the first place amounted to $1,120,000 put in by Australian taxpayers. Why was it able to do this? Because those great champions of free enterprise and the multi-nationals on the other side, under their then leader Mr Menzies, sold out the Australian taxpayers’ interests to the American owned company just as they sold out the Australian taxpayers’ interests in the COR petroleum companygave it away. Of course if they had left the Australian Government with some interest in these enterprises as the agent of the taxpayers we would have had a lever to bring pressure to bear on these multi-nationals so that they would have had to be in a fairly competitive market. We could have had competition with them. This article goes on to say:

From that time on, GM-H has been a fully U.S. owned subsidiary of the GM corporation. Note that the total amount of U.S. capital ever invested in Australia by GM is less than $4m.

The decision to make an Australian car was made by the Curtin government towards the end of the Second World War. GM-H expressed interest in this project and obtained various concessions from the government if it would manufacture the car. These included: a guarantee that the government would not itself engage in car manufacture; special terms for importing plant and equipment; and favourable consideration for tax concessions.

It may surprise many Australians to hear that the entire capital needed to start the Holden car project was raised by the Australian government.

That is, with Australian taxpayers’ money. The article continues:

In 1945 the finance committee of General Motors made it clear that it would not invest in the Australian project. Laurence Hartnett, the managing director of GM-H between 1934 and 1947, writes that the committee told him in effect: We’re not going to spend one cent of U.S. money on this. If GM-H wants a car, it will have to find all the cash for it in Australia.’ On hearing this, Prime Minister Chifley arranged a $6m loan from the Commonwealth Bank and the Bank of Adelaide.

The technological ‘know-how’ for the development of the Holden car also came largely from Australia. Car bodies were built in Australia as far back as the First World War. Before GM-H was formed, the Holden Motor Body Building Co. was making these in Adelaide and selling them to GM, who would then assemble the complete cars. Hartnett says that the body is the most difficult section of the car to make and that ‘the economies achieved by Holden ‘s at Woodville put them, in many ways, years ahead of the rest of the world in manufacturing techniques.’ Throughout the 1920s many other components of cars began to be made here. Hartnett was convinced that the expertise to set up a car industry existed in Australia, and in 1944 he told the top executives of General Motors: ‘If private enterprise doesn’t build an Australian car the Australian Government will ‘.

And of course, it was an Australian Labor Government. The article continues:

The prototype Holden car was eventually designed by a combined team of Australians and Americans.

The Holden really is ‘Australia’s own car’, in that it was financed by Australian government capital and built by Australian workers and engineers, together with a few Americans. Yet almost all of the profit, including the $300m in dividends, has gone to American shareholders.

Yet we hear people opposite at every opportunity praise the multi-nationals for what they have done for this country. This is written proof in the history of General Motors-Holden ‘s in this country that it was an Australian Labor government which encouraged General Motors to come to this country and which financed it in the first place. Senator Young said today that people on this side of the chamber were always criticising the multi-nationals. We have every right to criticise them. We also find honourable senators opposite always claiming that we will not get the economy of this country back on to an even keel until we increase productivity. What has happened with General Motors? Who has increased productivity to the extent that GM-H has such a surplus that it is now asking its employees to take a week’s annual leave so that it can dispose of the surplus cars? This came about only because of the high productivity of the workers employed by GM-H. That is why the company has a surplus, and honourable senators opposite have missed that very point. On the one hand they criticise the unions, saying that the unions have lowered productivity in any industry in which they operate but on the other hand we have this episode of GM-H asking its employees to stand down because it has a surplus of production. Why has it got a surplus? It is because of the willingness of the Australian work force to produce.

We heard Senator Lewis talk about the quality of Australian cars but he did not go on to say why in his opinion the quality of the Australian motor car is inferior to that of some imported cars, but of course there is an easy answer. When a person is working on a chain in an abattoir, if the boss speeds up the chain so that everything comes along the line at a faster rate the workers do not have time to skin the sheep properly. Similarly, in the motor industry workers do not have the time to spend on a motor car. Yet we find all of the criticism levelled at the trade unionists who work on the assembly line- never at the management. We never hear any criticism of management except that, as Senator Young said here today on more than one occasion, GM-H misjudged the market. Honourable senators opposite put the multi-national executives up as very shrewd businessmen yet he tells ushonourable senators can read this in Hansard tomorrow- that GM-H misjudged the market. Has not GM-H any marketing expertise? I will tell the Senate why GM-H has misjudged the market, Senator Young. It is because the company is looking to bigger and greater profits. Only today in the West Australian this headline appears: ‘ Union anger at GM-H ‘s $ 1 6m ‘. GM-H has made a $16m profit! It wants the workers to be laid off although it has made that massive profit. Nobody will ever convince me that the editor of the West Australian is a Labor supporter; he is not. This newspaper is anti-Labor to the core. As a matter of fact it is worse than the Adelaide Advertiser. Let us have a look at where the dividends have gone. This article goes on to report this statement by Mr Len Townsend, the Federal Secretary of the Vehicle Builders Employees Federation:

If the United States parent company was able to make a profit of $903m in the first quarter of this year then I think that all of that $ 1 6m should be staying right here.

If the parent company can make $903m profit, why can it not invest that $16m here to help out the working class people who have enabled that company to build up its massive production in this country?

Honourable senators opposite are always telling us how they have been able to bring the economy of this country back to an even keel. But let us look at the price of these motor cars over the past couple of years to see what has happened since the Prime Minister, Mr Fraser, and the honourabe senators who sit opposite have been in government. An article appearing in the Melbourne Age of 3 March shows now car prices have risen. The article mentions the GM-H Holden Kingswood, the price of which was $3,879 in March 1975, that is, when we were in government. We find that 12 months later, when Mr Fraser had not been in office 3 months, the price of that car went up to $4,969- a rise of $1,100 in those few months. In December 1976, after honourable senators opposite had been in office for about 15 months, we find that the price of that car was $5,533. It had gone up about $1,700. The next column in the table set out in the newspaper article relates to costs for March 1977. No price is shown there for the Holden Kingswood; it simply states ‘Rise expected’. The Ford Falcon in 1975 cost $3,869. In March 1976 it cost $4,859. In December 1976 it cost $5,704 and in March this year it cost $5,897, representing a rise of $2,000 in the short time that this Government has been in office.

The price of the Chrysler Valiant in March 1975 was $3,843, in March 1976 it was $4,832, in December 1976 it was $5,8 16 and again in the next column ‘Rise expected ‘ appears. But we are all aware of the secret deal between this Government and the motor industry over a price freeze in which the motor industry was told to keep prices down for 3 months. The papers tell the story that the industry was told in a secret deal that if it agreed not to put any price rise on their cars during this particular 3 months the Government would let the industry put up prices by 7 per cent after that 3 months. That is the type of people with whom we have to deal. They are the people who criticised the Whitlam Government when the motor industry was in trouble during our term in government. We did something concrete to help those people. Now we find them criticising us here today because we did something.

The time allotted me to speak will not permit me to give the full story. But one of the main reasons for the problem that GM-H finds itself in now is that back in September 1 976 the Minister for Industry and Commerce, Senator Cotton, asked the motor industry for information on projected imports of fully assembled vehicles for the remainder of 1976 and the first half of 1977. His action followed requests from the Australian industry for a review of the decision to end quotas in December. Consultations about not lifting the import quotas were held with Senator Cotton. But in the Australian of 20 April an article headed ‘35pc jump for car imports in March’ appeared. The article stated:

Car imports jumped by 35 per cent last month, according to official figures released yesterday.

In other words, this Government has given open slather to the overseas companies to bring as many cars into this country as they want at the expense of the Australian work force. No wonder the unions are up in arms against what this Government is doing. I am happy to say that the trade union movement and the working section of this community are not going to accept the policies of this Government, not only as they apply to the motor car industry, but also as they apply to the oppressive legislation that this Government is going to bring into this Parliament in the next few weeks to try to grind the working class into the dirt.

I made a speech in this Parliament some years ago in which I detailed to the Senate what I heard was being cooked up by Mr Fraser and Mr Street concerning what they were going to do. It has all fallen into place except for one thing, that is, where they take on the trade union movement. That will occur as soon as the Industrial Relations Bureau is established. As soon as the Trade Practices Act is amended to permit this everything will fall into place. I was accused of not telling the truth in what I said but it has now proved to be true. Honourable senators opposite will rue the day when I repeat what I said when I speak on the industrial relations legislation.

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

Senator STEELE HALL:
South Australia

– The further this debate proceeds the more the real motives of the Opposition in moving the substance of this debate are revealed. Senator McLaren has followed the usual path of so many of his colleagues, wherever they are in Australia, that is, to attack success- to point out any industry that makes a profit however small or large, and to criticise it for making that profit. Never so they concern themselves with companies which are failing, but always attacking success. It annoys them to see anyone making a profit. Today we have heard Senator Gietzelt and Senator Cavanagh extolling the virtue of one of the most disruptive forces in the industrial work force in Australia, namely Mr Gnetenko from South Australia. We have heard him being defended here today by a South Australian senator. Mr Gnetenko has done more to depress industrial success in my State, which I share with Senator Cavanagh, than any individual I know. Yet he has been extolled here today.

Senator Cavanagh:

– But the court upheld him.

Senator STEELE HALL:

– I am not concerned with what the court did to him; I am concerned with what he did to the industry of my State. As I said, we have heard this tirade. I thought Senator Lewis tonight put the situation in real perspective. He mentioned possibly one of the most important points of all in this debate, that is, that the Labor Party is willing to use recklessly and to its detriment the work force of General MotorsHolden’s Pty Ltd for its own political end here and across the nation. Those people are faced with a very hard choice- a choice not as to whether they will accept a loss of income but as to whether they will take a week’s leave with the co-operation of the company to let that company rid itself of excess stock. Tonight this is held up as being the act of a villainous group of industrialists who are preying on their workers in South Australia, Victoria and in other places where General Motors operate. This is not so. Other countries have amply demonstrated the co-operation that can avoid the necessity of loss of income or loss of at least weekly support by companies co-operating with their workers for shorter working weeks or, in fact a better idea in this case, by taking leave. I think it is despicable for honourable senators opposite to use for their own ends the hardship that is confronting those people and to take simply and anti-multinational and anti-profit line in the hope that somehow they will nibble away the popularity of this Government.

No doubt there are many hard choices besides those which are immediately facing the company and its workers. The management will have to make a great number of decisions in the future about what it will do, as will all motor manufacturers in Australia. It is a time of very great change indeed. Until now we have had 3 major motor manufacturers in this country. There will be five. Of course, the new policy has not yet been implemented. It is about to be implemented in the next several years. The sort of decision which GM-H must make now regarding excess production will inevitably have to be made by the other firms in the future as 5 firms become entrenched as fully fledged manufacturers in the limited market, although it may be a captive market, that Australia presents.

Beyond that is the fact that the world, particularly Australia, is turning to the small motor car. This move will be accentuated by the emphasis, that will become more pronounced as each year goes by, on the necessity to conserve essential and ever scarcer petroleum reserves. We therefore have launched into the development of the smaller motor car. Much of this development has come from overseas; far more than that development which stands behind the Falcon, the Valiant and the Holden. Overseas development has been centred upon small cars and that very centering means it is off balance with the 3 traditional big manufacturers in Australia. Each of those manufacturers have gone overseas for their own particular models or part of their models to meet the demand for small cars. This does mean that those 2 new Japanese entries into manufacture in this country are probably better placed to make small cars, with the development basis that they have overseas, than those manufacturers which exist here. We need not think that we are looking today at this problem, which is so inexpertly and ineffectively brought up by the Opposition, as a ‘oncer’ proposition. In the future -

The PRESIDENT:

– Order! The time allowed for debate on this motion having expired, the Senate will now proceed to the next business.

page 1133

SENATE STANDING COMMITTEE ON NATIONAL RESOURCES

Senator THOMAS:
WESTERN AUSTRALIA · LP

-I present the report and transcript of evidence from the Senate Standing Committee on National Resources on its inquiry into solar energy.

Ordered that the report be printed.

Senator THOMAS:
WESTERN AUSTRALIA · LP

– I seek leave to move a motion that the Senate take note of the report.

The PRESIDENT:

-Is leave granted? There being no objection, leave is granted.

Senator THOMAS:
WESTERN AUSTRALIA · LP

-I move:

On behalf of the members of the Senate Standing Committee on National Resources, it gives me much pleasure to bring up the Committee ‘s report on solar energy. This reference was given to the Committee on 30 March 1976 and a program of public hearings and a number of inspections were undertaken during the second half of last year. The submissions received and sought by the Committee contained a wide range of views and, although there was a consensus that funds should be directed to solar energy research and development, there were opposing views as to how it should be done.

During the course of the Committee’s inquiry the ongoing arguments over uranium mining and the development of nuclear power have resulted in solar power being promoted by anti-nuclear proponents and others as a readily available energy alternative. The media have also assisted in promoting this oversimplification and the attitude and expectations held by many people is that Australia and the world is on the verge of a solar era. Such is not the case and, even when given an optimistic forecast, a significant contribution from solar energy is still a very long way off.

It is important that the role of solar energy as an alternative energy source be considered in a proper perspective. Contrary to the simplistic view generally held, solar energy is a topic with a number of very diverse aspects. The main aspects of concern to the Committee were low temperature heat for domestic and industrial purposes, the heating and cooling of buildings, transportation and electricity generation. Other related aspects are wind power, tidal power, geothermal power, ocean thermal currents and hydrogen. In recent times both the first report of the Ranger Uranium Environmental Inquiry and the Royal Commission on Petroleum have commented on the lack of any recognisable energy policy in Australia. Not only has the administration of existing energy resources suffered, but the development of alternative energy sources can best be described a hotch-potch.

The Committee has made observations concerning specific aspects of solar energy research and development. These are summarised at the end of each chapter. The main factor retarding the national appraisal of the research effort required for the development of solar energy resources has been the lack of a national energy policy. Consequently, the Committee regards the establishment of an energy policy for Australia as an important priority. It is recommended that the Commonwealth Government establish a statutory body, the Australian Energy Commission, to have overall responsibility for developing and co-ordinating a long term Australian energy policy. The Ministerial responsibility for this body would rest with the Minister for National Resources.

It is envisaged that the Australian Energy Commission would be advised by an Australian Energy Advisory Committee which would provide advice on scientific and economic matters relating to an overall energy policy. The membership of the Advisory Committee would comprise representatives from industry, commerce, Commonwealth Government departments and research bodies, Commonwealth and State Government energy authorities, the Australian Science and Technology Council and tertiary institutions.

The Committee is of the opinion that the development of solar energy needs to be considered as part of an overall energy strategy. The evidence received suggests that solar energy will not make any significant contribution to Australia’s energy needs before the end of the century. The Committee feels that given the very long term nature of any benefits that are to accrue from solar research, and the extent of Australia’s coal and gas reserves, research and development funding for solar energy projects should be considered on a competitive basis with research funding required for other energy resources.

Until a long term energy strategy is produced by the proposed Energy Commission, the Committee feels that solar energy research at the tertiary level should be maintained in real terms. In the short run, the Committee feels that the areas of solar research which hold most promise for commercial development in the Australian context are low grade heat applications for industrial purposes and, in remote and isolated areas, heating and cooling of buildings and small scale power generation. In all other areas there is a need to maintain a watching brief on overseas research and development. University research should be adaptive of overseas technology or aimed at the development of innovative ideas. It is necessary to maintain a sufficient level of funding to enable Australian scientists to participate in technical exchange programs with other countries.

It is envisaged that the Energy Commission would eventually be responsible for the Administration of funding of all energy research and development projects. The Commonwealth Scientific and Industrial Research Organisation, the Joint Coal Board, the Atomic Energy Commission, universities, etc., would compete for funds available through the Commission. The Committee feels that this proposal would ensure rational public debate and awareness of Australia ‘s energy options.

Finally, I wish to thank the members of the committee, Senators McLaren, Maunsell, McAuliffe, Robertson and Townley, for their assistance and co-operation during the conduct of the inquiry. Thanks are also due to Senator Peter Durack who guided the Committee during its early months. Members of the Academy of Science provided us with valuable technical advice, while our Secretary, Charles Edwards, together with Andrea Edui-Illis and Gill Watters did an outstanding job. Our thanks are also due to the large number of individuals, firms and organisations which made submissions, presented evidence and assisted the Committee in any other way.

Senator McLAREN:
South Australia

-I seek leave to make a short statement.

The PRESIDENT:

-Is leave granted? There being no objection, leave is granted.

Senator McLAREN:

– I associate myself with the remarks of Senator Thomas, who is the Chairman of the Senate Standing Committee on National Resources which conducted the inquiry into solar energy. I am pleased that at long last we have been able to table this document in the Senate. It is much awaited and I am sure it will create a large amount of public interest. I have already received many inquiries asking when we would be bringing down our report. I think that the upsurge in interest in solar energy which we are witnessing today has been brought about to a large degree by the reference which was given to the Senate Standing Committee on National Resources to investigate the solar energy prospects in this country. Almost daily since our Committee began its inquiry, we have witnessed public statements and articles on solar energy. If we have done nothing else, we have at least awakened the people of Australia to the value of having solar energy in use in this country.

I will not cover the ground which Senator Thomas has covered. I will make mention of some of the recommendations in the report. We recommend that the establishment of an energy policy for Australia is an important priority. The next recommendation I will deal with is the most important one. I hope people who read the report do not become confused about our recommendations when they read this one. The recommendation states that no separate action should be taken to increase the level of funding or to accelerate the development of solar energy until an overall energy policy is established. We are not recommending that there should be no funding at all to accelerate development. All we are saying is that there should be no funding until the Government has devised an overall energy policy and established it as such. The third recommendation I will deal with states that the Commonwealth Government should establish a statutory body, to be called the Australian Energy Commission, to have an overall responsibility for developing and co-ordinated long term Australian energy policy. This authority would be responsible to Parliament through the Minister for National Resources. We already have set up the National Energy Advisory Committee. For those who are interested in the terms of reference of that Committee, they are printed in the Senate Estimates Hansard of 3 May. We questioned the setting up of that Committee yesterday. I am happy to say that two of the members on the National Energy Advisory Committee are very prominent people who gave evidence before our Committee of Inquiry.

It is interesting to note that 120 written submissions were made to the Committee of Inquiry and no fewer than 77 individuals gave oral evidence. This bears out the amount of interest that has been shown throughout the Australian community into the possible use of solar energy. I wish to join with Senator Thomas in thanking the other members of the Committee and also in congratulating its staff for the efficiency with which they carried out their duties on our inquiry. I seek leave to continue my remarks at a later stage.

Leave granted; debate adjourned.

page 1135

PLACING OF BUSINESS

Motion (by Senator Durack) agreed to:

That consideration or Business of the Senate be postponed until the next day of sitting.

page 1135

COMMONWEALTH BUREAU OF ROADS (REPEAL) BILL 1977

Second Reading

Debate resumed from 27 April, on motion by Senator Carrick:

That the Bill be now read a second time.

Senator KEEFFE:
Queensland

– We were discussing this Commonwealth Bureau of Roads (Repeal) Bill 1977 some days ago. To maintain continuity I shall make a brief reference to the manner in which the Bill came into this chamber. The purpose of the Bill is to repeal the Commonwealth Bureau of Roads Act 1 964, thus abolishing the independent statutory authority known as the Commonwealth Bureau of Roads, to enable the establishment of a new and expanded bureau within the Department of Transport to be known as the Bureau of Transport Economics. That larger bureau attached to the Department of Transport will comprise the Bureau of Transport Economics originally set up in 1971 and the existing Commonwealth Bureau of Roads. The Opposition agrees with the concept of a strong multi-modal transport advisory body. However, we believe that any such body should be established as an independent statutory authority, along the lines of the Bureau of Roads, under its own specific legislation. Because of that the Opposition is opposing this legislation.

On the last occasion on which we debated this Bill I mentioned that the views of the Opposition were basically consistent with the view expressed by many local authorities, not only in my own State of Queensland but in other parts of Australia. You might recall, Mr President, that on that occasion I also presented to you two or three documents which we sought to have incorporated in Hansard. The Minister representing the Minister for Transport (Senator Carrick) has also had an opportunity to examine them. I seek to have incorporated in Hansard an editorial comment from the Australian Municipal Journal of September 1976 which sums up the fears and misgivings that most relevant organisations have about the proposed amalgamation.

The PRESIDENT:

-Is leave granted? There being no objection, leave is granted.

The document read as follows-

Editorial Comment

The Bureau of Roads is a statutory authority; is responsible direct to the Minister for Transport; is authorised to make its own investigations and inquiries, and is required to report to the Federal Government.

The Bureau of Transport Economics is a part of the Department of Transport with limited autonomy. It may approach the Minister direct, conducts its investigations into matters of statistical and /or economic nature affecting all forms of transport. The carry-on process from its work rests with the Department.

COMMONWEALTH BUREAU OF ROADS AND BUREAU OF TRANSPORT ECONOMICS SHOULD REMAIN SEPARATE

The Commonwealth Bureau of Roads should be retained as an independent authority.

This is the unanimous view of municipalities in Victoria according to a survey conducted by the Municipal Association.

Whilst it is recognised that there may be economic advantages in the amalgamation of the two Bureaux it is believed that the long term philosophical and political aspects are more important than short term economies.

As an independent authority, reports of the Bureau are public documents. This ensures that all levels of government are given an independent view of the total road needs in Australia.

It might be useful to look back to where the Bureau of Roads began in 1964.

Prime Minister Menzies, who initiated the Bureau, did so because he was not impressed with the unskilled way in which the Commonwealth handed funds to the States for roads.

The principal reasons for setting up the Bureau of Roads were: to have road needs presented to the Commonwealth by the States to provide an ability within the Commonwealth to check the States’ assessment to initiate inquiries about specific classes of roads i.e. freeways to ensure overall priorities in the application of resources to minimise State rivalries to avoid political ‘horse trading’ prior to the expiration of the normal five year Commonwealth Aid Road Agreements.

The Association maintains that these reasons are still valid and in the best interests of local government to retain.

The present position gives the Commonwealth an accurate assessment of roading requirements in its various forms, assesses State and local government capacity to meet part of the cost, and sets out policy options open to the Government.

What is more it brings an enlightened approach to the general question of loading and apart from recommending the best use of resources is able to exercise control in this area which calls for joint governmental endeavour.

Amalgamation and integration within the Department of Transport could destroy the main attributes of the Bureau.

Attributes like independence from departmental and political influence are important. They give the Bureau credibility in the eyes of State and local governments.

Indeed it is hard to imagine why the Federal Government would want to destroy a body which has so many elements which demonstrate co-operative Federalism at work.

The Bureau has sought and obtained the co-operation of State Governments, State Road Authorities and local governments: It is regarded as a partner of equality.

The Bureau has talked earnestly, thoughtfully and cooperatively with the States, particularly through State Road Authorities. It has talked extensively with local councils.

It has promoted discussion between parties on a factual basis and with a great degree of moderation.

It has obtained the co-operation of the States, State Road Authorities and municipal councils in conducting road surveys, the results of which have been very material in the preparation of its reports.

This co-operative consultation and co-operative effort has been good for each level of government.

There is less master and more partner.

All parties have performed better because of the Bureau and the efforts it has made.

This could never have been achieved by a department in the conventional notion of public service administration.

Senator KEEFFE:

-I suppose this matter is a political issue at this time because of the new ‘in’ word, ‘federalism’, which appears to be not accepted now by those people who apparently accepted it in some of the State arenas prior to 13 December 1975. The latest announcement by the Minister for Transport (Mr Nixon), on 25 February, about road funding for 1977-78 makes quite clear the Government’s definition of federalism. It is a case of bleeding the States of funds and thereby forcing them to do what the Commonwealth Government wants them to do.

This Bill largely spells out in detail the new spirit of federalism. In other words, it is taking away certain powers from the States and centralising them in spite of what the current Government has said from time to time. Most of all, if the States want to develop roads these days it is a case of them finding their own funds. I have particular knowledge of Queensland and the north-western area of Western Australia where there has been little or no road development since December 1 975. The allocation of money for roads in Queensland never gets north of the Kingaroy line. The National Party Government of that State apparently believes that this is where the State ceases. We are unable to receive the amounts of money that we used to receive under the Grants Commission. The Opposition has a notice of motion about the Grants Commission on the notice paper and I shall expand on that in greater detail later. I wish to quote briefly from the 1975 annual report of the Commonwealth Bureau of Roads. I hope that those honourable senators on the Government side of the chamber who happen to be present and those who are listening to the broadcast will pay close attention. The report states:

As the Bureau is small, autonomous and free from the normal departmental function of administration of legislation, we are able to work closely with official and unofficial groups within the community. Equally we can, in a completely independent manner, express and evaluate the views of governmental, industrial and community organisations. Our experience has confirmed our view that the statutory authority has a very important role in open government.

On the other hand, the Bureau of Transport Economics has been mainly involved in ad hoc evaluations. In short, the real question raised by this legislation is open government and public accessibility to information. This is borne out by the devious and misleading statements made by the Government regarding the legislation. The Minister representing the Minister for Transport sought in his second reading speech to assure the House that the new Bureau, operating along the guidelines he has set out, would not detract from the methods used by the Bureau of Roads. That statement is not taken word for word from the speech but it conveys the spirit of what the Minister was trying to convey to Australia. My colleague in another place, Peter Morris, the Opposition spokesman on transport, put a question about this matter on notice. It appears on page 92 of Hansard of 15 February 1977. In part, it said: . . that the expanded Bureau of Transport Economics will be able to examine and publicly report on current Government policies in respect of transport without prior vetting by the Department of Transport; if not, why not.

The Minister for Transport gave one of his usual long-winded statements that said nothing. In short, the Minister refused to give my colleague an assurance of any sort. I have here a letter that was written by the Director of the Secretariat of the Australian Council of Local Government Associations. It is addressed to my colleague, Mr Morris, and it relates to the Minister for Transport. The date of the letter is 1 9 April 1977. I showed it to you, Mr President, the other evening. I seek leave to have the letter incorporated in Hansard.

The PRESIDENT:

-Is leave granted? There being no objection, leave is granted.

The letter read as follows-

AUSTRALIAN COUNCIL OF LOCAL GOVERNMENT ASSOCIATIONS

Churchill House, 2 1 8 Northbourne Avenue, Canberra, A.C.T.2601 19 April 1977

Mr P. Morris, M.P. Shadow Minister for Transport, Parliament House, Canberra, A.C.T. 2600

Dear Mr Morris,

Commonwealth Bureau of Roads

Thank you very much for the extract from Hansard of 30 March 1977 which sets out your remarks on the Second Reading Speech debate on the Commonwealth Bureau of Roads Repeal Bill 1977.

Mr Nixon appears firm in his resolve to proceed with the amalgamation of the Bureaux and their absorption into the Department of Transport. In his Second Reading Speech he has given a number of assurances in regard to the autonomy of the new Bureau and I note that these assurances were covered in the debate on 30 March.

There is one point in particular that I believe must be stressed and that is that all reports of the new Bureau shall be made public. In the Minister’s Second Reading Speech he said:

In addition the reports of the Bureau will continue to be made public to the same extent and in (he same way as they are now.’

The qualification in this sentence is worth examining and if possible an assurance obtained that no reports will be held from the public that deal with public matters.

Yours sincerely,

N. Walls Director of Secretariat

Senator KEEFFE:

– The honourable member for Kennedy (Mr Katter)-he does not belong to my Party; he is a supporter of the Government in another place -

Senator Walsh:

– He did once, did he not?

Senator KEEFFE:

– He has been a member of a number of parties but currently he is a member of the National Party of Queensland. It is many years, thank God, since he was a member of our Party. I refer to one of the mis-statements that this particular gentleman often makes. He said:

I would like to talk a little about the Queensland road system and why that State is concerned about all matters relating to decision-making in respect of the funding of roads.

The State requires long arterial roads which have to be maintained. Because of the splendid contribution made by the Government Coalition Parties almost all of these arterial roads are sealed.

That is nothing but a blatant twisting of the truth. If the honourable member says that about his electorate, obviously he does not go off the Flinders Highway. That has been sealed only in recent times. There are one or two other bitumen roads in his electorate. There is one to Duchess or the Dajarra area. There are one or two others in the area. During the last year or so we have consistently complained about the deteriorating condition of the road between Charters Towers and Townsville. This is only a portion of the Flinders Highway. There have been a number of accidents. Lives have been lost. Some months ago I received a letter from the Minister for Transport in which he said that it was hoped that this area would be taken into consideration and that something would be done about it. Unless it happened over the weekend, nothing has been done about it. The statement of the honourable member for Kennedy is obviously far from the truth, because the Federal division of Kennedy has one of the worst sets of roads of any Federal division in Australia. If he thinks that is all his constituents are worth, obviously he is not worth keeping as a member. The Mount Isa-Townsville road remained a dirt track for over two-thirds of its length during the 23 years prior to 1 972. It was only under the Labor Government that sufficient funds were made available to seal that road. Unfortunately, we were removed from office just prior to the sealing of the last few kilometres.

The road is now fully sealed from the coast to the Track in the Northern Territory.

At the outset I said that the Opposition recognises the advantage to be gained from an expanded role for the Bureau of Transport Economics and the Bureau of Roads. It also recognises that there must be a multi-modal approach to assessing the needs and future requirements of transport. Where we differ from the Government is the way in which the amalgamated Bureau should be established and the degree of autonomy that it should have, on the one hand, and the level of accessibility that interested groups should have to the Bureau, on the other. I think that is the crux of the whole situation. Above all, the Bureau, in its activities, should be placed beyond the political influence of the Minister. It will not be. That will not be achieved simply by repealing the Bureau of Roads Act of 1964. Despite what the Minister for Education said in his second reading speech, and despite the comments he might make in reply, the fact is that the Bureau will be downgraded to the limited status of the Bureau of Transport Economics, rather than the amalgamated body being upgraded to the independent status of the Bureau of Roads, operating under its own legislation.

In summary, we believe that the proper way to establish the new Bureau would be by way of separate legislation. The action encompassed in this Bill is a retrograde step. It is another blow against open government and public participation by this Government. It deserves to be rejected by the chamber. It is on those grounds that we oppose the legislation. We believe that the Government has not taken into consideration the needs of the ordinary people. It has walked rough shod over every local government authority involved. It has ignored the pleas of all local authorities in Queensland. They have been particularly vocal. Lengthy submissions have been made. Apparently the Minister for Transport thinks that they are not worth considering. He may whistle a different tune when election day comes in 1 978. A lot of people who live in local government areas, particularly those who are deeply involved personally, have very long memories. They will not be happy about being told by a centralist government- I am using that word with a ‘capital C- in Canberra, which is dictating to all the States, how they will run their States. People complained that the Whitlam Government ran a centralist government, but it was an open democracy compared with what this Government is doing. Not only is it bringing in legislation such as this but it is imposing penalties and restrictions on State governments that they have not known previously. Even my friend, the Premier of Queensland, Mr Bjelke-Petersen, has complained louder and on more occasions since the Fraser Government has been in office than he did while the Whitlam Government was in office. He has now found that the $100m which he ought to have accepted, some of it in tied grants, from the Labor Government, has slipped through his fingers. What happened to the $100m after 13 December 1975 is not known. Every time Mr Bjelke-Petersen asks for the $100m, even to upgrade a couple of roads on the way to Kingaroy, he cannot get the money because it has disappeared. I have endeavoured to set out as briefly as possible the attitude of the Opposition to this legislation. I hope it is rejected in this chamber.

Senator JESSOP:
South Australia

– This Bill has created quite a deal of interest, particularly among local government authorities in South Australia. Since I have been a member of Parliament, which goes back a few years now, I do not think I have received as many representations from local government on any matter as I have received on the Commonwealth Bureau of Roads (Repeal) Bill.

Senator Walsh:

– Are they all opposed to it?

Senator JESSOP:

– They are not opposed to the concept of the repeal of the Act, but the essence of the representations which I have had is that they are anxious that whatever the Government does it should strive to maintain the independent status or statutory authority of the advisory group that will take its place. I have raised this matter in the Senate on numerous occasions. I have cast my doubts on the wisdom of introducing a departmental authority rather than a statutory authority. I was quite interested in Senator Keeffe ‘s remarks about the centralistic implications of this Bill. It seemed to be quite odd coming from him, particularly when he supports many measures which have that implication. In the past the intent of the previous Government was quite specific. This Bill purports to maintain the advice to the Government that has been forthcoming from the Bureau of Roads.

I recall raising the question at an estimates committee some time ago of whether it was advisable to have a Bureau of Transport Economics and a Bureau of Roads. I felt that there was a duplication of work. I recall that a witness, one of the departmental officers, at one of those estimates inquiries agreed that there was a certain amount of duplication of effort. I imagine this is one of the reasons why the Government has repealed the Act and has attempted to economise and to bring the elements of the Bureau of Transport Economics and the Bureau of Roads together in the Department. The Minister for Education (Senator Carrick) began his second reading speech by saying:

As honourable senators know a new professional research body is being created which will be responsible for coordinated research and advice to the Government on all aspects of the transport sector.

The question in my mind is whether the Department of Transport is working on the basis of advice to the Government through the Department, which is an entirely different concept to that laid down in the original Commonwealth Bureau of Roads Act by which the Bureau was set up to provide independent advice to the Minister. Local government authorities, State governments and bodies such as the Australian Bureau of Roads, the automobile associations and other bodies have appreciated that this advice has been given without the restraints and restrictions of departmental authority. That is one aspect of the Bill that worries me. I believe it will in time perhaps prove to be an inhibiting factor in relation to providing advice to local government bodies and others who have an interest in transport generally. However, I am prepared to support the Bill. I will be anxious to observe the economies which are effected. I shall certainly be available to local government authorities and State departments of transport.

Senator Mulvihill:

– Will you go to Murray Bridge?

Senator JESSOP:

-The council at Murray Bridge has shown some interest in the matter. I am quite certain that we will see certain economies effected. I think this is important at this grave time which we are facing, when we have to effect economies in the public sector. Certainly, I shall be observing the situation with great interest in 12 months time to see what has transpired in the interim. I turn to the second reading speech of the Minister for Education. I notice that in referring to the present Bureau of Transport Economics the Minister stated:

The present BTE is not established by legislation but is attached to the Department of Transport As I have already said no one has ever questioned the integrity or the independence of the BTE. It has always operated with the same degree of autonomy that the Bureau of Roads has enjoyed.

The Minister then goes on to pay tributes. I make a point about that part of the speech to which I have just referred. I express the doubt that the same degree of independence is possible because the Bureau of Roads has never been rigidly controlled by legislation. This has proved to be an advantage when providing independent advice to the authorities to which I referred earlier. As far as I am concerned the matter will be under close observation by many people who are interested in road transport generally in Australia. I hope the Minister will acknowledge that if there is any difficulty associated with the advice which is being provided to local government, State governments and other people interested in transport, the Commonwealth Government will be prepared to have another look at the matter in 12 months time. I join the Minister in paying a tribute to the services rendered by Mr Loxton who has been chairman of the Bureau since its inception and who continued past the date of his retirement. I also pay a tribute to Mr Ron Mccormack who has been the secretary of the Bureau of Roads. I have found the staff of the Bureau always willing to advise anybody. I have certainly asked their advice on aspects associated with transport matters in South Australia. I appreciated the efforts which the staff put into the preparation of the report on the Stuart Highway. Earlier in my parliamentary career I was grateful for its help with the Eyre Highway in which I was interested and which is now sealed right across South Australia and into Western Australia. I look forward to seeing the evidence of the advice which the Bureau has given to the Government in relation to the construction of the Stuart Highway which, at the present time, is in a disgraceful condition. That condition has been allowed to persist for too long when we consider its strategic importance in relation to the development of the area and also its significance with respect to the encouragement of tourism in South Australia and the Northern Territory. It provides access to mineral areas in South Australia. The President is well aware of the rich deposits of copper ore and uranium in the vicinity of Roxby Downs. There are large coal deposits in the vicinity of Lake Phillipson near Coober Pedy. I believe that in the future all these mineral deposits will be a very valuable asset to South Australia and will require not only the provision of an adequate railway line which is presently being constructed but also a road which will be very significant for the mutual development of South Australia and the Northern Territory.

I pay a final tribute to the officers of the Bureau of Roads for the work which they have done and which has been of great significance and value to South Australia, particularly in relation to the Eyre Highway and the Stuart Highway. I regret in some ways that we have had to take action to wind down or wind up- whichever term one likes to use- the Bureau of Roads.

Senator Mulvihill:

– A sentimental journey.

Senator JESSOP:

-I think Senator Mulvihill is one of the sentimentalists of the Parliament. I am sure he has some regrets that the Bureau of Roads will no longer be in existence. I say to the Minister for Education that I am sure that many honourable senators on this side of the chamber will be following the progress of the new arrangement with great interest. I hope that if there prove to be some disadvantages in the step we have taken, the Government will review the matter in due course.

Senator WALSH:
Western Australia

-The Commonwealth Bureau of Roads (Repeal) Bill repeals the Bureau of Roads Act 1 964 with a view to incorporating the functions of the Bureau into the Bureau of Transport Economics which, in turn, is a division of the Department of Transport. While there is a good deal to be said for the creation of a body which is able to take an overview of the broad question of transport, it is important that such a body retain its independence, its ability to give independent advice, and to make independent assessments of transport problems and convey them to the public. It is precisely that assurance which the Government will not give about this Bill. On 1 5 February my colleague, Mr Morris, in the House of Representatives sought from the Minister for Transport (Mr Nixon) an assurance that studies conducted by and recommendations of the Bureau of Transport Economics would not be intercepted or censored by the Department or by the Minister before they became available to the public. The Minister’s response to that request fell very far short of a guarantee that such interception would not take place.

When we look at the record of this Government in general and of this particular Minister we have absolutely no confidence that such independent functions will be permitted to the Bureau of Transport Economics. For example, because the Minister has discretion in these matters, even under the existing Bureau of Roads Act, he has not released 2 reports or 2 studies conducted by the Bureau of Roads in 1976. On 9 October 1976 this Government decided that it would legislate less and regulate more. At the same time or a week later it established what it called the Ministerial Review Committee. This is an organisation which will vet and adjust contracts to supply government stores. It will operate to provide additional secret and unqualified protection to Australian industry. As the Australian Financial Review succinctly described this proposal in an October editorial, it constitutes a ‘licence to steal’. We have had secret investigations conducted by Sir Henry Bland, secret investigations into Medibank and more recently a secret review of aviation and the McNeill Committee on government transport. All these committees of investigation or commissioned studies have been conducted in secret and the reports have never been released to the public. So, I regret to say that we can confidently expect the same secrecy once this Minister and the Government manage to incorporate the duties and responsibilities of the Bureau of Roads within the Department of Transport through the Bureau of Transport Economics. There will be the same interception and the same degree of censorship that we have seen from this Government in so many other areas. There is a powerful case for an independent bureau of transport which can take a broad overview of the whole transport question and reform or reverse existing extravagant transport practices and attitudes.

The industrialised world somewhat belatedly has begun to realise its overwhelming dependence on petroleum products, a raw material which if present trends continue, will be exhausted within 50 years. Transport consumes 50 per cent of petroleum which is used in Australia. In the midst of this petroleum depleted world, we are about to have imposed on us Concorde which uses 3 times as much fuel a passenger mile as a Boeing 747. The attitude of the present Minister for Transport to this fuel hungry monster, this noise polluting and probably ozone destroying monster, was succinctly stated in his speech to the Australian-American Association on 1 8 March this year when he said:

My own view is that in Concorde we have a new generation aeroplane designed to halve the travelling between Europe and the States . . .

Senator Jessop:

– I rise to take a point of order. What relevance do the honourable senator’s remarks have to the Bill?

The PRESIDENT:

– Yes. Senator Walsh will keep his remarks relevant to the Commonwealth Bureau of Roads (Repeal) Bill.

Senator WALSH:

– Speaking to the point of order, I believe that my remarks are relevant because I understand that the Government ‘s stated objective for this repeal Bill is to incorporate within the Department of Transport, which has a broader responsibility for transport matters, the functions formerly performed by the Bureau of Roads. So, given that this is the Government’s rationale for introducing this legislation, I think it is relevant to comment upon the broad question of transport and transport economics of which the roads factor is a part. To complete the quotation, Mr Nixon said:

History has shown that efforts to impede progress eventually fail.

So this Minister regards Concorde, which uses 3 times as much fuel a passenger mile as a Boeing 747 aircraft, as progress in a petroleum depleted world. Given his attitude to that matter, who could possibly believe that a bureau of transport economics controlled by such a Minister would put before the public a rational and responsible evaluation of Concorde or anything else?

Let me turn to domestic aviation and our much vaunted 2 airlines policy- one of our sacred cattle- where we seem to have achieved the worst of all possible results. It is a Government sponsored ‘duopoly’ which charges the public monopoly prices but which fritters away the potential monopoly profits by unnecessary duplication of services and wasteful and phoney non-price competition, with the whole operation subsidised by the taxpayers to the extent of $60m or $70m a year. Some might say that in an affluent society this does not matter. But, given the wastage of fuel which is innately associated with the operation of Australian domestic aviation, I suggest that it does matter. Things like that cannot be properly measured by conventional economic criteria. For example, normally 4 flights leave Perth for the eastern States twice daily. They leave within 60 minutes of each other at midday and midnight. Sometimes there are only 3 nights at night. So, we normally have 8 flights a day from west to east and in the reverse direction and passengers can choose whether they travel at midday or midnight. More importantly, the aircraft are frequently half full. I once flew to Sydney on a midnight flight from Perth with 14 passengers.

The PRESIDENT:

– Order! Would you please make your remarks more relevant to the Bill before the Senate.

Senator WALSH:

-I think that they are relevant. If, as a rationale for this Bill, the Government is suggesting that, by incorporating the Bureau of Roads in the Bureau of Transport Economics and the Department of Transport, transport may be more effectively planned, integrated and co-ordinated in Australia, I think that my remarks are relevant because the things that already have happened in transport in Australia under the old Department of Civil Aviation, now the Department of Transport, suggests that such rationalisation, co-ordination and integration will not occur. There certainly is no evidence that under this Minister that situation is likely to change. I suggest that we would be better off with a complete monopoly in domestic aviation because no sensible monopolist would despatch three or four half-empty aircraft simultaneously as the current ‘duopoly’ does. I will not say any more about aircraft.

Senator Jessop:

– Get your feet on the ground.

Senator WALSH:

-I will get them right back on the ground and right back home to Western Australia.

Senator Grimes:

– Why not talk about the way that he uses planes? That would be interesting.

Senator WALSH:

-To Leigh Creek. I have heard something about that but I am not sure of all the details.

The PRESIDENT:

– Order! There are too many interruptions and there is too much conversation in the chamber.

Senator WALSH:

-Yes, Mr President. Interjections are highly disorderly, I understand, and one should not reply to them. An adequate and independent Bureau of Transport Economics, which this Bill will not provide, should report on the merits of public transport and on the true social cost of private alternatives. For example, if we had such a bureau I would expect it to look very critically at the development of Australia’s only fully planned city, this city, Canberra, which seems to have been built and still is being built around the private motor car which seems almost certain to disappear within the next SO years.

Unfortunately, no bureau of transport is likely to avoid the recurring inter-governmental struggles over road funds while premiers, such as the present Premier of Western Australia, are still around. Sir Charles Court- and this has been a controversial subject over the last couple of months- has consistently eulogised this Government’s new federalism policy, the stated purpose of which is to phase out specific purpose payments such as road grants, to force the States to fund such areas of expenditure from their own revenue and to grant the States the power to impose their own income tax to fund such programs with the intention of making the States physically responsible. As I understand it, that is the stated purpose of the new federalism. Sir Charles Court was presented with the first instalment of this new federalism in February this year when the Federal Government revealed that there would be a cut in real terms in the amount of Federal funds allocated for roads. Following a recommendation by the old Bureau of Roads, funds to Western Australia will increase by only 3.2 per cent in the next financial year over the allocation for this financial year. In real terms that is a fall of at least 10 per cent. With the reduction in Federal funding, which was totally consistent with the present Federal Government’s commitment to reducing Government expenditure and to making the States fiscally responsible for the areas over which they have administrative control, here was an excellent chance for Sir Charles to demonstrate in the most practical way his support for the new federalism by imposing a State income tax to meet what he asserted to be a most critical need for extra road funds. But what did he do? He reverted to type. He bellowed and shrieked at Canberra. In the West Australian of 28 February this year Sir Charles was reported as having said that he was ‘totally dissatisfied and appalled at the $60. 2m allocated for 1977-78’. He was further reported as having said:

An increase of only $1.9m in funds for 1977-78 would severely retard Western Australia’s road progress. Many major projects of vital importance to the State’s economy and development would have to be deferred or slowed down. This would lead to a significant increase in unemployment, which would have a serious economic effect.

The obvious solution for Sir Charles Court, he being an enthusiastic supporter of reduced Federal spending and State fiscal responsibility, would have been to impose a State income tax to provide the road funds that he so stridently asserted on 28 February were essential. But he did not do that. He just said: ‘Canberra has to provide more money’. Either Sir Charles does not understand the new federalism or he chooses to ignore it. Despite all the windy rhetoric about wanting to assume responsibility as a State Premier on behalf of a State government, it is revealed that all he really wants is Federal money in amounts which he thinks should be forthcoming and without any Federal strings. He obviously craves power without responsibility. Of course, he failed to secure any additional Federal funds.

To cover up that dismal failure he obtained what he called a concession from the Federal Government, an agreement to reduce the mandatory provision which requires the States to expend stipulated amounts from their own revenue sources. That was reported in the West Australian of 14 April under the heading ‘No road fund increase, but concessions’. Sir Charles failed to get more Federal funds and then announced his plan to spend less State funds. Obviously that can mean only that less will be spent in total. So we see that the Premier, who on 28 February stated that unless more money was obtained many major projects of vital importance to the State’s economy and development would have to be deferred or slowed down, concluded a deal to spend less and then had the audacity to claim that as a victory. Of course, no Bureau of Roads or Bureau of Transport Economics can overcome such irresponsible and illogical grandstanding. I think that only a competent media could deal with that problem and a competent media, especially in the area of the printed Press, is precisely what we do not have in Perth. But if such a Bureau of Transport Economics, taking an over-view, was independent of people like Sir Charles and his Federal counterparts it could present to the nation a rational, integrated transport assessment. This legislation and the Government’s plans which flow from it will not provide that assessment.

In closing I just want to mention that I, like Senator Jessop, have received an extraordinarily high number of communications from local government authorities on this matter. Senator Jessop did not actually state how many local government authorities from which he had received communications were for or opposed to this proposition. I have received some 23 letters from local government authorities in Western Australia. That is the number sent to one Federal member of Parliament. No doubt many local authorities have written to other members of Parliament. All of the letters I received were opposed to this plan. The reason for their opposition was the fear that once the functions of the Bureau of Roads have been incorporated into the Department of Transport, under the supervision of and subject to the direction of the Minister, the independence which is required for road funding and for transport matters generally will cease to exist. For that reason primarily my Party is opposed to this Bill, a decision with which I fully agree.

Senator ARCHER:
Tasmania

-The Commonwealth Bureau of Roads Act 1964 is now to be repealed as a necessary but probably the least important thing to do with the change in road transport legislation. When the Bill was brought in in 1 964 it was undoubtedly a very forward thinking Bill and a very good Bill, but it is interesting to read in Hansard of the time that even then it was opposed. It is equally interesting to find now that its repeal is being opposed. The success that the legislation and the operation that it set up had is probably what has mainly led to its demise. The Commonwealth Bureau of Roads has done very well and has achieved a very high regard both in Australia and overseas. I think that it has a status and a stature that would be envied by many other organisations and bodies. In this regard I would like to make specific reference to the excellent contribution made by Mr Loxton and to the fact that he contributed very largely to seeing that the job was finally completed.

I have always firmly supported the Commonwealth Bureau of Roads. The new arrangements have caused me, like so many others, to think quite a lot about what it will do and how it will work. I too have received letters from many local councils, as arranged by their federal body- letters which were sent out at a time when the information was not available. All the letters that I received from councils were based on a premise that was never established. In Tasmania I have seen members of about 12 councils and I have written probably to a further twenty, which is about 75 per cent of all the councils in Tasmania. Since I have either spoken to them or written to them not one council has written back or commented in any way to the effect that they were still of the opinion that they originally expressed. For my own part I looked both backwards and forwards to see what had been done and what was likely to come. To try to get the basic principle into some sort of perspective I looked in the Year Book for 1975 for a reference to the Commonwealth Bureau of Roads and found that there are 822 000 kilometres of roads in Australia. This represents twice the per head distance of countries like Canada and New Zealand. With all the climatic vagaries that Australia has, we have to remember that distance is Australia’s cross. We have to consider the very element of the distance and the 7 682 000 square kilometres that comprise Australia 4000 kilometres from north to south and from east to west- make it an absolute nightmare as far as transport is concerned. In Western Australia in particular, with 2.5 million square kilometres and a population of only about one million people, the provision of transport is extremely difficult.

Also we have to consider that the growth in road transport has been extremely spectacular. In 1 965 there were 0.32 cars per head of population and by 1975 this had risen to 0.44. By 1980 it is estimated that there will be 0.5 cars per head of population, which is an increase of 50 per cent in 1 5 years- a 50 per cent increase on what had been regarded as being fairly normal growth. However, with this growth in car population there has been a decline in population density. As general affluence has increased, so has the mileage per car.

People no longer try to live close to their jobs. This criterion has become secondary. As a result, the mileage rate is increasing by 3.6 per cent per car per year. We also ought to take into account that in 1 954, 65 per cent of the population lived in the cities but by 1971 this had grown to 71 per cent and had created considerable added congestion which, again, had not been planned for earlier. I do not like reciting a lot of statistics but I think it is necessary to include some basic information so that we can see the extent of the problem. I should like to add finally the fact that in 1965 there were 3.6 million cars and by 1975 there were 5.9 million cars- a rise of 64 per cent. By 1980, it is estimated that there will be 6.9 million cars- an increase of a further 16 per cent. That is the rate at which the problem is catching up and passing us.

With that background, I now ask: What is the future of the Australian car? I think that we have to look at it not only in relation to roads but also we have to consider that commerce, industry, housing, environment and, most of all, people, are all part of the problem of the car. Public transport, private transport, trains, trams, ferries and aeroplanes are all part of the same picture and they all have to fit in and they all have to be part of the overall picture. We have to assess the value of the services versus costs. I think I need go no further at the moment than to say that what we have at present simply is not good enough. I think all honourable senators agree with that. Is the service going to change or are the people going to change? Do we settle for the almighty car? Who is going to pay? Should we continue to knock down thousands more houses so that we can have more freeways and more parking stations which will result, of course, in more pollution, noise and so on? It will take all of the resources that we can muster to produce an answer before we even start to try to correct the problem. Plenty of alternatives are being offered. I have heard of many. I have heard people promoting the idea that there should be immense taxes on cars or petrol; that there should be immense parking fees; that we should ban cars from the centres of the cities altogether; that we should provide free buses; that we should provide monstrous parking areas at railway stations; and that we should provide free city bus services from the train depots. All these ideas bring to mind the question of who pays and is the cost reasonable? How much of the central cities and inner suburbs should be torn down to make room for roads and car parks? Should we consider producing tax inducements of some magnitude or severe penalties to ensure that people use the suburbs more?

Public transport at the moment serves those who are best able to serve themselves. It fails to look after the people who were so aptly described by Nicholas Clark as YOPHS-the young, the old, the poor, the helpless and handicapped and the sick. Public transport does very little for any of those groups. It really serves the people who are able to make their own arrangements quite satisfactorily. This particular aspect alone is one which will need examination in greater depth in the future. The costs of transport cannot be continually ignored and cannot be overlooked. Trains alone in Australia lose $750m a year in running costs. Allowing nothing for interest and nothing for depreciation, this represents 10 per cent of the total income tax collection in Australia. When one takes into account the costs of the Melbourne loop, a new Sydney airport, a second Sydney bridge or the West Gate bridge, one is dealing in figures that have reached a level that we have not had to take into account in Australia before. These figures are getting higher and we are left with them. We cannot be sure of the future but we can expect that the car will remain the main item with which we will have to deal in the field of transport. In years to come there will be more cars, more kilometres travelled, more people, more noise and more pollution. We must mobilise all expertise at the top level to prevent further decline and to provide the service required at a cost that the public can afford and is prepared to pay.

I am well satisfied that the proposals put forward in this legislation can help. 1 have examined, point by point, the items raised by local government in relation to this matter. I should like to deal with them in order. I do not consider that it is a case of losing something or of getting something as good but of getting something better. I should like to go through the points that were raised by local government associations in a document I have before me and the points which were contained in the second reading speech of the Minister for Education (Senator Carrick). I will deal with one point at a time. The first question asked by local government associations was whether the amalgamation should be effected by legislation rather than administrative decision. In his second reading speech, the Minister said:

There have been suggestions that the new BTE should be established by an Act of Parliament, that its powers, duties and procedures should be set out in legislation. The Government has given careful consideration to this question and has reached the firm conclusion that legislation is not required. The present BTE is not established by legislation but is attached to the Department of Transport . . . The new BTE will be able to react to changing circumstances.

The second point raised was that the Bureau should be attached to the Department rather than incorporated within the Department. The Minister stated:

There has been a degree of concern expressed at the Government’s action in amalgamating the 2 bureaus. This is quite understandable given the success the bureaus have both enjoyed in undertaking their respective duties. I repeat, however, those same duties will continue to be undertaken, but we believe to an even greater degree of success.

The Government is confident that practice will show the new Bureau providing an even better service to governments at all levels and industry than the separate bureaus have in the past.

The third point was that all previous policy advisory functions should be maintained. The answer to that one is that the new body will continue the present functions of both the present bureaus. The primary functions will be to assist and advise the Government. Its duties will be in part to undertake evaluations of the Australian road situation; to advise and assist the Australian Government in its consideration of financial assistance; advise and assist the formulation of policies aimed at the reduction of transport costs; undertake research and advise on the improvement of transport efficiency; advise and assist on the rationalised planning of transport facilities; advise on the optimal allocation of resources in the transport field; and assess and advise on transport planning and administration procedures.

The fourth point was that advice should be direct to the Minister for Transport rather than through the Department which has responsibility for the other transport modes. The Minister said in his second reading speech:

As I have already said the new BTE will act independently of the Department of Transport in research activities and in giving advice to the Government. I repeat, its Director will continue to have free access to the Minister for Transport. That is the Government’s clear policy and direction on this matter.

The last point is that the Director should be given senior status with a high level of professional and administrative autonomy and possess wide practical experience. The answer to that one is that the rights of officers and employees of the Bureau will be safeguarded. The Minister said:

I am sure that members of the Bureau of Roads who transfer to the new Bureau of Transport Economics will quickly appreciate the greater career opportunities available to them.

Those are the points that were raised earlier and the answers that are given. I have found no major objection raised by the people to whom I have given those answers.

We must also consider that the decision on amalgamation was supported by the Coombs task force. At page 1 66 of its report it stated:

It is no more sensible to maintain two separate bodies both concerned with the economics of transport than it would be to maintain a Bureau of Agricultural Economics and a Bureau of Wool Economics. If the two Bureaus were amalgamated, the whole would be more useful and powerful, in an analytical sense, than the two separately . . .

I think we all have to agree that that is basically commonsense providing we get the goods in the end, and I for one am satisfied that we are getting them. If the new body can carry out the work that is being done by the Bureau of Transport Economics there is no real objection to the amalgamation of the 2 bodies. If it is able to cover Commonwealth policy concerning the reduction of transport costs, improvement in transport efficiency, co-ordination of transport systems and rationalised planning of future transport facilities, I do not think we should look to any more from it than that. There is no doubt that the new organisation will provide greater efficiency and remove a lot of the overlapping which could take place under the present system. The new body will also enable the Government to obtain full utilisation of the people involved and to get the maximum out of the expertise that is available.

I would like to conclude with just a word or two on the transport situation in the island State. Tasmania may have only 67 800 square kilometres of area and only 1 8 500 kilometres of road or 0.46 kilometres of road per head, but what it does have that is different from other States is 300 kilometres of water between it and its nearest neighbour, and that is separation. Those honourable senators who remember the pre-air service days would know what that separation then meant but since then there have been many changes. We now have jet air services, overnight freights, roll-on roll-off ferries and freight equalisation and there is talk of hydrofoils. We have all that, but last week we did have total isolation. Total isolation does not involve only monetary cost and great inconvenience; it involves for more. As far as Tasmania was concerned there will always remain the scars of lasting damage that go with the loss of markets and the loss of tourists who will never come back, and things of that sort. The people of Tasmania do not care who is at fault. It does not matter. It is not right that disagreements be settled in the way that they were settled because the whole of the State suffers and it suffers permanently. Transport is of no use unless it is reliable. Anything that can be done through this legislation I hope will assist our transport problems. I look forward to the implementation of the intentions of this legislation and I support the Bill.

Senator MULVIHILL:
New South Wales

– I intervene in this debate to echo the sentiments that were expressed by Senator Keeffe and Senator Walsh. I do so because I think there is going to be a false complacency as to an objective gained under this new body known as the Bureau of Transport Economics. Most of the speakers have emphasised the problem of road transport. Senator Archer in his concluding remarks did refer to the role of the maritime fleet. One could marry that with the role of the railway systems. Can the Federal Government on its own or, for that matter, in partnership with the State governments, provide an effective rationalisation of all the various services? Before I entered this debate Senator Coleman spoke to me in the corridor about the dilemma in Western Australia- that first class roads are not merely a mode of transport but also a link with outside areas, and I accept that point. I suppose that with the complexities involved in a vast continent like ours we cannot have the best of every world.

I question whether this Bureau of Transport Economics is to be staffed by what I would call economic boffins, who expound theories that are never absolutely correct. In the 1 950s when the railway systems converted from steam to diesel traction it was said that every system would have a great surplus of funds, but they did not and there are many reasons for that; I shall come to them in a moment. Conversely, one can look at maritime reports. My very good friend the National Secretary of the Waterside Workers Federation of Australia, Charlie Fitzgibbon, would argue that more of the bulk transport between the States should be conducted by shipping. On the other side my equally good friend, the Federal Secretary of the Australian Railways Union, Ralph Taylor, and his equally competent State Secretary, Jack Maddox, would argue that the railways should get a bigger share.

In a democracy- and sometimes that word can be put in inverted commas- it is very difficult to marshal and determine priorities. We all remember when Khrushchev visited the United States. When he looked at the freeways the first comment he made was about so many onepassenger cars. That was in direct contrast with conditions in the Soviet Union which has vast rural tracts. The Australian position is somewhere between those two. After creating a new fact-finding bureau the Federal Minister for Transport has the unpalatable job of rationalising the various modes of transport. Every State has sections of roads that are death traps. But sometimes I wonder whether we are seeking the millennium. I say this because it might be argued that a lot of the interstate- I emphasise interstate as opposed to intrastate- road hauliers get on the gravy train. They fight every State government, whether Liberal or Labor, about meeting their justifiable contributions towards the cost of road maintenance. They have vehicles of massive tonnages and far too often they drive for too long. They can be a menace on the road- there is no question about that. These people will not meet their obligations.

To take the argument a little bit further, I suppose bulk cargoes, whether transported by rail or road, are not as profitable to transport as perishable goods. These people want the cream of industry. 1 know it can be argued that they take the small deliveries. They claim they can provide better schedules than the railways, but 1 question that. I know, as a motorist, that some hauliers are not very concerned about road courtesy when they get on our highways. But forgetting that, as most drivers can cope with various situations, consider the shoulders of our roads. The reason that many councils are crying out for financial assistance from their State and Federal governments is that some of the private enterprise interstate hauliers- buccaneers of commerce is all that they are- want to make a quick dollar and do not care what they do. It is regrettable that these things have to be said about these people.

I know that my colleagues in the Transport Workers Union- whether it be Ivan Hodgson, a Federal official, or McBettie, a State secretarywould agree with me. These hauliers believe they can get by. If they want to get by and to do their own thing that is all right but if they are going to jeopardise priorities and not meet their taxation obligations- 1 emphasise that- for destroying our highways, it is just too bad if they go to the wall. Experts tell us that if we have an effective road haulier system co-ordinating with railheads within a radius of 200 miles we have a very efficient service. But when other people drive between our capital cities- driving their motor vehicles excessively without any concern for road courtesy- and get in a jam they squeal. I know that these people have gone to the High Court with claims, irrespective of whether their State had a Liberal or Labor Minister for Transport. They had some victories but they had them at the expense of the Australian taxpayer as a whole.

We have not got full advantage from diesel traction and, for that matter, an improved containerisation system on the waterfront, because there has not been orderly planning. 1 appeal to the Government for orderly planning. Orderly planning does not involve embracing the tenets of Marxism; it is simple, plain common sense. I do not think Senator Archer meant his concluding remark about industrial troubles holding up transport between his State and the mainland to be a backhander. The fact is that all the trade unions have accepted containerisation. Of course, they have argued that if fewer jobs are available as a result of containerisation they are entitled to be protected and, in some cases, that they are entitled to severance pay. I came into this Senate in 1966. Since then there have been numerous reports on the maritime industry telling us about the savings that could be achieved with quicker turn-rounds of ships and the maximisation of lifting appliances. I think the work force has accepted those developments, although it knew that in many cases the promotions of some men in their 40s could be jeopardised. I am thinking about whether tally clerks, storemen and packers assumed duties normally performed by other trade unionists.

The message I am trying to deliver tonight is that, with all due respect to the creation of this Bureau of Transport Economics, the fact of the matter is that it requires firm administrative decisions. Frankly, I believe that the Australian Government, in conjunction with the State Governments, should lay down strict guidelines as to where there should be exclusively sea haulage, rail haulage and road haulage. I do not think Australia can afford excessive competition. After all, successive governments, whether they be of Liberal or Labor persuasion, by and large have accepted that we have the civilian airlines of Ansett Airlines of Australia and Trans Australia Airlines and that it is questionable that a third mainland airline would be of any use. That is one of the very strong doubts I have. If this body is created and it waits 2 years before presenting its first report, what is the Minister for Transport (Mr Nixon) going to do in the meantime?

I give an example of the complexities of problems that governments do not always solve but other people have to solve. Not so long ago the Australian Railways Union called a seminar of shunters from every State in Australia. I think I would be more inclined to mention this if Senator Wright, with his hangup about trade unions, were here. This meeting was called because under uniform gauge system various types of rolling stock were being used. There were certain variations in the bogie construction. Whether honourable senators like it or not, there are people working in marshalling yards of a night, who even with the best artificial lighting, are facing industrial hazards. The union has held meetings. lt has tried to get a general understanding on safety codes. The union did this by itself. 1 have not yet heard Mr Nixon or the Minister for

Employment and Industrial Relations, Mr Street, offer one word about trade union initiatives. But I know that the next time the trade union goes to the Conciliation and Arbitration Commission to ask for certain margins involving night work it will not appear in the transcript that this union indicated in a very sane way some of its problems.

There is no doubt that transport is the lifeblood of Australia. But it is so complex that I should hate to believe that the solutions to its problems are purely economic. They are not. I say again and again that there seem to be too many mythical solutions. Even Canada and the United States, which have federal systems and interstate commerce authorities, have much more effective controls than we have.

I listened with interest to what Senator Archer said about the diminishing rural population. I illustrate my response to him by saying that I suppose like a lot of other senators I travel a lot on our State highway system in my car. Of course there are still areas that are accident hazards. But I know that some people- they might be inefficient motorists- believe that they have to have a perfectly straight highway. I think that is asking too much when it means that Tasmania and Western Australia are denied adequate funds for normal sealed roads. This is a situation we are facing now. My Deputy Leader in another place, Tom Uren, was courageous enough to question whether we have to pursue the provision of super highways religiously. I have come to the conclusion that we have to be concerned about all our State highways. Some of the buccaneer interstate hauliers feel that we should take out every bend from the highways because they are hazards and they could cause them to jack-knife their semi-trailers. I do not want to be difficult about this. The self same people argue and try to cajole State governments into abdicating their taxation responsibilities.

I conclude on this note: I believe this is a very complex problem. A former Minister for Transport, Mr Jones, explained to me how hard it is to rationalise the legitimate requests of local government. Sometimes a particular town gets a certain amount of patronage because it has a restaurant at which hauliers stop. But I do not believe that the creation of a body to be known as the Bureau of Transport Economics will be the answer to all these problems. If the present Minister for Transport cared to look at a host of reports on the maritime industry he could go back, I suppose, to a report in the early 1950s in relation to the introduction of a uniform gauge system. That was supposed to be the millenium as far as traffic was concerned. On looking at the various railway commissioners ‘ reports it is evident that initially the uniform railway gauge system encouraged considerably more revenue for the various railway systems. I know that, at times, members of the maritime unions have expressed fear as to whether their jobs were being affected. Some of the wisdom of Solomon exercised with a mainland and not a Tasmanian attitude may be needed to adjust bulk loadings and to decide what shall go by rail and what shall go by water transport.

I say, with respect, that interstate hauliers are compounding our highway problems. They take the cream of the industry. They do not even join the union that covers their employment. When they get into a jam, they indulge in a lot of tactics that are very close to blackmail. I do not think we should have the idea that this legislation will be the answer. I do not think it is. If I were Mr Nixon, I would get the maritime authorities and the railway commissioners together and carve up all the major transport needs. I would say: ‘You have this and you have that’. To make my point quite clear, I would say that the role for ownerdrivers of road transports should be tied to a radius of 200 miles and under from railheads. I question whether the economy of this country will permit further assistance to this area. It may be that people will argue on that broad blueprint. I think that, to come to grips with the problem, we must have a national conference at which interested people may put their points of view. We should not leave the matter to a few economists. I think that their theories in this respect will be proved just as wanting as have some of the other ideas they have put up in other transport concepts.

Senator CARRICK:
New South WalesMinister for Education · LP

– in reply- I will be brief. I thank honourable senators for their contributions to the Commonwealth Bureau of Roads (Repeal) Bill. As would be natural on a subject of such interest, honourable senators took the opportunity to roam rather widely on major problems concerning roads, transport in general and local government interests in particular. In general the debate, when it touched upon the essentials of this legislation, expressed some anxiety as to whether in the amalgamation of the Bureau of Roads into the Bureau of Transport Economics any of the qualities that the Bureau of Roads has exhibited will be lessened or removed. All honourable senators, I think rightly, paid tribute to the first class work of the Bureau of Roads and the leadership of Mr

Loxton. All have felt the need for the independent and research viewpoints. I merely point out that the Minister for Transport, Mr Nixon, has been emphatic, first of all in defining the goals and, secondly, in stating that in this amalgamation none of the qualities of either body will be lost.

I remind honourable senators that the Minister sees a new professional research body being created which will be responsible for coordinated research and advice to the Government. He has indicated that the body will result from the amalgamation of the Bureau of Transport Economics and the Commonwealth Bureau of Roads. It will carry on the existing functions of both bodies but will be more broadly based and be capable of initiating additional and more comprehensive investigations. The new body to be known as the Bureau of Transport Economics will be more effective, so the Minister says, in undertaking and coordinating this related work than the present 2 separate organisations.

The debate has ebbed and flowed upon whether this body will be as effective as it might have been if given statutory authority and independence. The debate has ebbed and flowed also on whether the Bureau of Transport Economics has been an effective body in the sense of its capacity to do main things or simply to respond to ministerial and departmental requests. The Minister has stressed the very great work that has been done by the Bureau of Transport Economics and has stressed that in fact the body itself is not just a division responsive to the Minister for Transport but is capable of much more objective work. The Minister has given assurances concerning continuity for the staff of the Bureau of Roads. Against that and the strong assurances of the Minister, I commend the Bill to the Senate.

Question resolved in the affirmative.

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

page 1148

AUTOMATIC DATA PROCESSING EQUIPMENT BOUNTY BILL 1977

Second Readings

Debate resumed from 26 April, on motion by Senator Durack:

That the Bills be now read a second time.

Senator BUTTON:
Victoria

– It has been suggested, I understand, that these 3 Bills be taken in cognate debate. There is in fact no debate because the Opposition does not oppose these Bills. It would be a waste of the time of honourable senators for the Opposition to indicate its degree of me-tooism on issues which have been raised in the second reading speech of the Minister for Veterans’ Affairs (Senator Durack). In the House of Representatives, the Opposition spokesman on these matters, Mr Young, made some comments which displayed his virtuosity in the handling of his shadow portfolio but which did not amount in any sense to a disagreement of opinion with what the Government is doing or to a debate. As I indicated, the Opposition does not oppose these Bills. They may have a speedy passage as far as we are concerned.

Question resolved in the affirmative.

Bills read a second time, and passed through their remaining stages without amendment or debate.

page 1148

INSURANCE AMENDMENT BILL 1977

Second Readings

Debate resumed from 3 May, on motion by Senator Cotton:

That the Bills be now read a second time.

Senator WRIEDT:
Leader of the Opposition · Tasmania

-The 2 Bills before the Senate deal with the insurance industry; one with the life insurance side and the other with general insurance. The amendments proposed are, in fact, an extension of amendments which have been moved before, particularly in the area of life assurance. The original legislation dated back many years to, I think, the 1940s. The amendments relating to general insurance result from the Insurance Act of 1973. The Opposition is not opposing any of the amendments. For that reason I feel that it is not necessary for us to spend a great deal of time on either Bill. The proposed amendments have been spelt out quite clearly in the second reading speech of the Minister for Industry and Commerce (Senator Cotton). I believe that it is a good thing that we can observe, from both sides of the chamber, that over the years the Life Insurance Act, especially as it is an Act of much longer duration than the Insurance Act, has enabled a great deal of stability to be built into the life assurance industry in this country. It is also an area in which one could quote a whole range of statistics to indicate the significance and the involvement of insurance generally in the Australian economy.

It is important that on both sides we recognise that quite apart from the fact that very large mutual companies handle very large sums of money- their premium incomes are enormous and their investments significant- there are statutory provisions as to what they do with some of those investments. These are generally accepted by the broad mass of Australians and I think certainly by the broad numbers of people in the Parliament. Despite the fact that insurance companies operate in what might be termed the free enterprise or market system, it is still necessary for governments to exercise reasonable controls, especially to protect the policy holders. Despite the fact that these amendments are being brought down, the Minister in his second reading speech said:

At the same time new problems have arisen which are not covered in the Act at all. With this in mind, the Government views the current set of proposed amendments to the Life Insurance Act as a forerunner to a much wider review to determine what kind of supervisory legislation is best suited to Australia’s life insurance industry in the future.

That is a clear statement of intent by the Government to make sure that as time goes by there will be a continuing surveillance of the life insurance industry. I believe that is something which we would all support. The number of policy holders in Australia is so vast, their policies mean so much to them, that it is important that governments ensure their proper protection.

The Insurance Act is much more recent legislation. The purpose of the Insurance Amendment Bill is to strengthen, as the Minister has said, the administrative machinery and to remove a number of anomalies which have become apparent in the three or four years in which that legislation has been operating. Without the need to extend the debate I indicate that the Opposition will not oppose the legislation. We accept in good faith the intentions expressed in the second reading speeches and that the Government’s desire is to see not only a healthy and strong insurance industry in Australia but also adequate protection for policy holders. We believe that both these Bills are steps in the right direction. For that reason we will not oppose them.

Senator ARCHER:
Tasmania

– I support the passage of the Life Insurance Amendment Bill and the Insurance Amendment Bill. I shall make a few comments which I believe are relevant at this time. Very few people fully appreciate the size and stature of the insurance industry. The 45 life assurance companies and approximately 220 fire and general insurance companies spread throughout Australia control an awfully large proportion of the business of Australia and do a great deal towards adding to the stability of both business and private life. The proposals being put forward have been approved by the industry with the reservation that it generally feels that they have not gone quite far enough. I certainly agree with this. I think there is plenty of room for further amendments to the Acts. I hope that over the next year or so at the most we will be able to have a new Life Insurance Act. It has been a good Act. It is now being partially brought up to date. The money values in the legislation are being changed. The Treasury is still working on this matter. The industry has made substantial submissions to Treasury. While not many of its submissions have been taken into account at this stage I believe that they will come up in the next set of amendments proposed or, hopefully, in a new Act.

I mentioned the size of the industry. Over $3 billion a year is paid by Australians into life, fire or general insurance. Another figure worth remembering, just to give more weight to this industry, is that in the field of natural disasters the cyclone in Darwin cost the fire and general insurance companies between $180m and $200m. It was the biggest payout ever in Australia. What is interesting is that it was a complete industry loss. With the systems of reinsurance and co-operation, both in Australia and overseas, of this $ 180m to $200m approximately $130m was paid in by overseas companies. I shall comment on a couple of other areas. I believe that clause 36 of the Life Insurance Amendment Bill is probably the most important clause in that it allows the minimum valuation basis to be updated. This will be a great value to all policy holders and will enable higher bonuses to be paid. The appeals areas have been extended and the Administrative Appeals Tribunal clause will be implemented to allow for a wider range of appeals.

An area that I would like to see under scrutiny is what is referred to as the 30/20 rule. I hope that in the next series of changes we may find that more flexibility can be introduced into this rule. With the amount of money that the insurance industry handles, I believe that we must ensure that the investment of that money is for the greatest national good. I query that it is for the greatest national good if the 30 per cent has to be put into government security at a low rate of interest, which prevents the policyholders from obtaining a reasonable bonus. They are the owners of the money. The benefits that come from it should be theirs.

The change in investment patterns during the last few years has been significant and has reflected various changes in the financial structure not only of the insurance industry but of the commercial sector as a whole. It is interesting to note that between 1965 and 1975 life companies changed their investment in fixed assetsproperty, furniture, etc.- from 9.8 per cent to 21.8 per cent, at the same time reducing the investment in mortgages and loans from 33 per cent to 18 per cent. I think that is quite a noticeable trend. At the same time, investments in government securities, local securities, debentures, secured and unsecured notes, preference shares, ordinary shares, holdings in controlled companies, etc., have varied only from 57 per cent to 58 per cent. The insurance industry has done a lot for Australia. Industry at large could not have advanced without the protection of insurance.

The main reason that people still buy life assurance is for security. The second reason is for an investment. Primarily it is for security. Whichever way it is taken, life assurance has to compete with all the other investment forms for funds. There is a strong and competitive industry. The companies compete very highly for business. The standards of insurance in Australia are the equivalent at least of the standards anywhere in the world. The main trend in the last few years has been the change from ordinary life assurance to superannuation. I believe that is a trend that we will continue to see in the next few years. Between 1971 and 1975 there was an increase of 39 per cent in annual premiums in ordinary insurance business, while in superannuation business the increase was 1 19 per cent. In industrial business the increase has been only 14 per cent. I think I can do no more than support the passage of the Bills. I agree with the Opposition on this course.

Senator DURACK:
Western AustraliaMinister for Veterans’ Affairs · LP

– I thank the Opposition for its support of these Bills.

Question resolved in the affirmative.

Bills read a second time.

In Committee

The Bills.

Senator BAUME:
New South Wales

– By arrangement there was only one speaker from each side in the second reading debate. However I would now like to address a few remarks to the Bills, to state some of my belief in what the insurance industry can do and has done for this country and to make a point which would amplify what was said by Senator Archer.

In Australia we have a great need for capital formation. We have a great need for money available on a long term basis. We have a great need for capital formation in both the private and public sectors. I am concerned that of the ways in which capital can be made available it is the voluntary availability of long term capital from the local investment market which we particularly need and which is particularly important. The insurance industry over the years has enabled this kind of resource to be made available to Australia when we needed it. We can obtain also money from overseas sources; we can also obtain money from taxation.

We would like an opportunity for the maximum amount of long term capital which we need for national development to be made available through industries such as the insurance industry, which has such a fine record in this country and which has done so much to provide the large amount of capital we require for a number of national development programs.

There has been concern during the past few years about some of the actions which have limited the capacity of the insurance industry to respond in this way. We are concerned at the high level of government spending, industrial problems, economic uncertainty and excessive economic nationalism. These made problems worse for the industry and exacerbated the problem of developing and making available a sufficient long term capital in which we are interested. Poor return on funds or a low rate of return on funds invested did not help. Australia is a small market. There has been wage escalation, cost rises, high rates of taxation and de facto price control. All those factors have not helped this industry in the job that it is trying to do.

I am concerned about what is happening with the development of available capital for investment at present. At present in Australia most of the money is going into short term saving, at the short end of the spectrum. The money is going into the savings banks and the building societies. The money can be withdrawn as quickly as it is deposited. We can see that this money is not really available for use in the kind of development projects which we would like to see funded from within this country. We would like to see these projects funded from within Australia, by Australian people, through agencies such as the insurance industry. The life offices and the superannuation funds have traditionally been the major suppliers of long term capital funds for commerce and industry in Australia.

The life assurance operations are particularly noteworthy because they are a major source of contractual long term voluntary capital. I make it clear that in anything we are doing to regulate the insurance industry and in anything we are doing to alter the conditions under which it operates we must remember the major role it serves in this country for the mobilisation for the development of this nation of capital for long term investment. That was a role which almost the insurance industry alone served. It is no good being complacent about the present statistics of savings or short term money which cannot be used and which is inappropriate.

I have been concerned at the kinds of trends in recent years. Fewer new life assurance policies are being taken out. More policies are being voluntarily discontinued. They are not desirable trends. There has been a greater use of cheaper forms of term insurance which do not involve a savings element. Many things affect these new trends. Among them are included the high rate of inflation and the general community expectation that inflation will continue. There is also the increased tax which the life offices have had to bear and which have caused some of the policy holders to invest their funds elsewhere. I read the debate which took place in the other place when these Bills were discussed. There was very little discussion or recognition of the great national role which the life insurance industry and life offices have played. I think it is worth placing on record what they have done and why they have played such an important and central role in the capital formation of this country.

Senator MESSNER:
South Australia

– I address my remarks to clause 36 of the Life Insurance Amendment Bill and in particular I refer to the future operation of that clause and the regulation of a minimum valuation basis for companies in the future. I believe this will allow a more modern approach to the overall amount of assets required by companies to be set aside as contingencies against their liabilities falling due and we will find that life insurance companies will be more capable of obtaining better returns and consequently of investing their funds more profitably. Obviously life insurance companies in the past have done extremely well in serving the people of Australia. I notice that in the last year the after-tax rate of return to life assurance companies was about 7.76 per cent. That compares more than favourably with returns which incur no taxation, such as those of the Commonwealth Public Service superannuation scheme. Of course, it compares more than favourably with a pre-tax interest rate which is available on the money market today. Obviously, the rates of return to life insurance companies are affected greatly by the alterations to the taxation laws of the last few years. Taxation, multiplied by a factor of 3.5 as it affected life companies, has had its effect in not flowing through to mutual shareholders or policy holders. It has effectively cost them something of the order of $350m in that time. Consequently, this must have serious effects on the growth of the life insurance industry over this time. It seems that the only area which has grown in the last few years has been that of the surrender of policies already held. Of course, this has occurred due to the rates of inflation around the place in the last few years.

I also address my remarks to proposed new section 138(13) of the Life Insurance Amendment Bill which refers to the creation of the Administrative Appeals Tribunal. In effect it refers to the people who will be entitled to sit on that Tribunal. I suggest to the Minister that he consider the possibility of the exclusion of brokers and directors of broking firms in that context as well, as it would seem that they have a direct interest somewhat comparable to the people who have been excluded under that proposed new section. The value of the industry in Australia is well worth nurturing as it employs something like 25 000 people throughout the community. Of course, that is only in the life assurance field. In relation to the Insurance Amendment Bill, in that general area I believe some 30 000 to 35 000 people are employed. So the industry is a substantial employer and, as Senator Baume pointed out earlier, a substantial investor in the community. In fact, I believe that something of the order of 12 per cent of Commonwealth securities outstanding are held by life assurance companies. These are worth about $2,000m. That is a sizeable proportion of the Commonwealth debt and, consequently, the insurance industry is a major provider of funds for the Commonwealth for its development and expenses. Of course, this leads to the impact of the 30/20 rule which we know has also restricted the overall earning capacities of life assurance companies over time.

I conclude by paying tribute to the life assurance industry and to the people who are employed in it. They have done well to have held their heads above water in times of such high inflation. Some of the professional people whom I have come across in the industry are of the highest value. They are certainly people of great quality and of the highest integrity. I have great pleasure in supporting the Bills.

Senator CAVANAGH:
South Australia

– I deal with the Life Insurance Amendment Bill which amends the Life Insurance Act. I am at a disadvantage because I have just thought of a point and as I do not have the principal Act with me I have some difficulty in knowing whether I am correct in my assumption. I am concerned with clause 27 of the Bill which refers to section 1 80 of the principal Act. It amends that section by inserting after the definition of ‘register of deaths ‘ the following definition:

Prescribed amount’, in relation to a child, means $500 or such other amount as is, under the regulations, applicable to the child for the purposes of this Division.

I wonder whether under this Bill that is the maximum payment upon the death of a child? I mention this because I have had a case before which concerned me and which I have reported to the Senate. These honourable insurance companies send their salesmen around for the purpose of insuring an infant when it is born. The parents take out a large insurance premium for the infant only to find in early childhood, if the child dies, that they are not paid the amount expected. I believe that there was a policy for $1,000 on the life of a child. The child died and the parents, in all good faith, had a proper burial and spent some $400 on a memorial for the grave, thinking that the expenses would be paid from the insurance. But when they came to collect they found that there was a payment of only $10 or £10, as it may have been those days. The justification by the insurance company was that that was all they were permitted to pay under the Act.

On questioning the then Minister I found that this was a prescription in the Act to stop parents profiting from the death of their children or killing their children for the benefit they could get from insurance. I think those days are gone. If it were ever essential to have that provision in the Act, I think that time has passed. I seriously question whether that is the purpose of the amount of $500 as prescribed in the Bill. If it is not, does such a restriction on a maximum payment still apply on the death of a child? Is there justification for continuing such a prescription now?

Senator DURACK:
Western AustraliaMinister for Veterans’ Affairs · LP

-Senators Baume, Messner and Cavanagh have raised a number of important matters in the Committee debate on these insurance Bills. Perhaps some of the remarks made in the debate during the Committee stage would have been more properly made during the second reading debate. But certainly the matter raised by Senator Messner should be given some further consideration by the Minister for Industry and Commerce (Senator Cotton) who is in charge of the Bills. The matter that Senator Cavanagh raised also is one which requires some further consideration before a proper answer can be given. I do not know whether there are any other senators who are likely to be raising other matters -

Consideration interrupted.

The TEMPORARY CHAIRMAN (Senator Bonner:
QUEENSLAND

– Order! It being 1 1 p.m., in conformity with the sessional order relating to the adjournment of the Senate, I formally put the question:

That the Temporary Chairman do now leave the Chair and report to the Senate.

Question resolved in the affirmative.

The Temporary Chairman having reported accordingly-

page 1152

ADJOURNMENT

Immigration -Small Scrap Metal Business in Brisbane- Industrial Relations

The PRESIDENT:

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

That the Senate do now adjourn.

Senator WALSH:
Western Australia

– The matter that I wish to raise on the adjournment tonight concerns an application for immigration by a Mr D’Leno. The matter dates back to August 1975. Mr D’Leno, who is currently residing in India, was engaged to a Miss Thornton who has lived in Perth since 1975. She originally approached Mr Berinson, the former member for Perth in the other place, with regard to the application by her fiance, Mr D’Leno, to migrate to Australia from India. On 10 November 1975, Mr Berinson wrote to Miss Thornton stating that investigations were under way in Calcutta. I took up the case on 9 January 1976 when I wrote to the current Minister for Immigration and Ethnic Affairs (Mr MacKellar) requesting him to grant an entry visa to Mr D ‘Leno, Miss Thorton ‘s fiance, under the appropriate provisions of the Act. The letter was formally acknowledged on 21 January 1976. On 8 April, I received a substantive reply from the Minister in which he stated that the refusal to grant the application still stood. The letter said:

Mr D’Leno can at best be described as a semi-skilled factory worker and on today’s unemployment situation his economic viability must be in serious doubt.

I replied to the Minister on 13 April 1976 pointing out to him that I could not reconcile the reasons stated in his letter of 8 April with the guidelines issued by him on 25 March governing entry qualifications and in particular with guideline 2 (c) which stated:

The present rules provide for the entry of- the fiance or fiancee of a permanent Australian resident or a person who has been accepted for permanent residence. (‘Migrant’ visas are not granted in these cases the visas issued being validated in the first instance for a stay of up to 6 months only. Upon production of evidence of marriage within that 6 months or an approved extension, ‘resident status ‘ normally is granted )

Guideline 2 (a) issued by the Minister on 25 March 1976 stated that the present rules provide for the entry of the sponsored spouses and dependent children of permanent residents of Australia. Miss Thornton then appealed direct to the Minister on 22 April. On 3 May, the Minister acknowledged my letter. Subsequently, on 28 June, I received a letter from the then Acting Minister, Mr Ellicott. The letter was undated and referred to Miss Thornton as Miss Thompson, and to say the least, was a carelessly drafted letter to come from the Minister’s office. This letter from the then Acting Minister, Mr Ellicott, stated:

If 2 (c) is read in conjunction with item 8 you will see that there is no unconditional assurance that the entry of fiances will be approved. While fiances do not have to fulfil occupational criteria they are expected to meet all other selection requirements.

The letter subsequently stated:

Because of the employment history of Mr D ‘Leno and his lack of skills, he is not considered to be economically viable.

The comment I wish to make on that statement is, firstly, that there is an obvious contradiction between the statement that fiances do not have to fulfil occupational criteria and the reason later stated in the Minister’s letter that because of the employment history of Mr D’Leno and his lack of skills he is not considered to be economically viable. The second comment is that Mr D’Leno had a very stable history of employment and was in fact employed by the one company, the Britannia Biscuit Company of Calcutta, as a mechanical supervisor for 13 years.

On 24 April 1976 I wrote again to the Minister for Immigration and Ethnic Affairs, Mr MacKellar, disputing the reasons given by Mr Ellicott in his undated letter received on 28 June. On 3 September Mr MacKellar formally acknowledged my letter of 24 August. On 29 November Miss Thornton again wrote a personal appeal to the Minister. In the meantime, on 10 September new guidelines were issued by the Minister in which there was some modification of guideline 2 (c), the important part of the modification being that in certain instances economic viability may be required. But that seemed to have been superseded in this case by guideline 2 (a) which stated that the present rules provide for the entry of the sponsored spouses and the dependent children of permanent residents of Australia. At that time Mr D’Leno was not a spouse; he is now a spouse.

On 2 December my secretary rang Mr MacKellar’s office regarding this matter. He rang again on 7 December and on 28 February 1977. On both occasions the Minister’s staff undertook to reply to these queries, but those undertakings were not honoured. On 25 March 1977 Miss Thornton advised me that she had travelled to India and had married Mr D ‘Leno. She said that she had been informed, presumably by the Minister or his representative, that there would still be a further delay before her spouse, as he then was, could obtain an entry visa to Australia. On the date, 25 March 1977, my office rang the Minister’s office and advised his office of the changed circumstances between Mr D’Leno and Miss Thornton, namely, that they had been married. On 29 March my office sent a telegram to the Minister’s office requesting a quick resolution of this matter due to the changed circumstances, namely, the marriage of Miss Thornton and Mr D ‘Leno.

Both the guidelines which applied to this matter from 25 March 1976 and the revised guidelines of 10 September 1976 unequivocally state that the present rules provide for the entry of the sponsored spouses and dependent children of permanent residents of Australia. Whatever justification there may have been- I do not believe there was any- for the delay on this matter prior to the marriage of Miss Thornton and Mr D’Leno now that that marriage has taken place there can be no possible justification for further delay. I request that the Minister for Social Security (Senator Guilfoyle), who represents the Minister for Immigration and Ethnic Affairs in this chamber, convey this complaint to the Minister with a request that it be speedily resolved. The matter has been handled very badly in various ways by 2 Ministers of this Government. Firstly, the Government has failed clearly- at least at this stage- to abide by its own guidelines. Secondly, on a number of occasions members of Mr MacKellar’s staff have treated this matter in a casual manner. Promises to reply to queries have not been honoured. There has been an inordinate delay in replying to correspondence. When Mr MacKellar was out of the country and when Mr Ellicott was the Acting Minister an undated letter was written which failed to identify Miss Thornton correctly. This matter has gone on for nearly 2 years. I appeal to the Minister representing the Minister for Immigration and Ethnic Affairs to ensure that the matter is resolved promptly and properly.

Senator BONNER:
Queensland

– I wish to raise a matter this evening that has concerned me and some of my colleagues for a considerable time. When it was first brought to my attention I could not help but make the comment that Agatha Christie will not be dead until this matter is properly settled. Two of my State colleagues- Senator Martin and Mr Col Lamont, MLA, from Brisbane- have been working on this case for some time. It concerns a Mr George Aufferber, a scrap metal dealer and exporter of Brisbane. To understand the problem one needs to have some idea of the location of the Brisbane airport. Those who have been fortunate enough- I say that proudly- to visit the city of Brisbane in Queensland and who have arrived at the Brisbane airport would perhaps have some idea of what I am talking about. The runway of the Brisbane airport runs east-north-east to westsouthwest. The airport is bordered to the north by Brands Road. To the east it is bordered by the sea. To the south it is bordered by KingsfordSmith Drive and the Brisbane River with its wharves and jetties. To the west it is bordered by Nudgee Road. Mr Aufferber’s scrap metal yard is situated on the eastern end of the airport between the end of the runway and the seaboard.

Mr President, a number of documents have been prepared for me showing dates, places, times and people’s names. Rather than give them off the top of my head I would prefer to read from the documents so that there will be no misquoting or misunderstanding of what I have to say. This story goes back as far as I am concerned to 18 October 1962 when the Government gave notice to Mr Aufferber that the Department of Civil Aviation had decided not to proceed with the acquisition of his land. Subsequently Mr Aufferber, in good faith, proceeded to build up a scrap metal business. Naturally enough, the land had to be filled, scrap metal containers and fences erected, and power, water and telephone connected to the property. For this man to carry out his business all this had to be done first. This was carried out at a fair cost to the man himself. In approximately 1970 the Commonwealth Government moved to close his chief access road. This would have left him with an access which involved travelling over a crumbling wooden bridge owned by the Brisbane City

Council and, to reach the wharves, he would have to take his scrap via a very much longer route, some 6 miles out of his way.

In September 1970 his appeal through the Lands Administration Commission was upheld and his major access road over a safe bridge remained open. In 1972, or a little earlier, the Commonwealth resumed all land in the area including Aufferber’s land and the main access route which included the safe bridge. In January 1973 the Labor City Council wrote saying that it would not carry out maintenance on the bridge and therefore the 3 ton limit imposed by it would remain in force. Aufferber was faced with 2 possibilities: First, his land would be resumed by the Commonwealth- it was finally resumed in 1974; and, secondly, the only other route involved a bridge which was unsafe and over which he could carry only a very limited amount of scrap. Meanwhile Aufferber has run into a remarkable series of accidents and departmental obstructions from other departments which I will describe in a moment. Before doing so I would like to make a few further remarks about the bridges.

Aufferber began moves to ensure continuing access to Sugar Mill Road Bridge which is now controlled apparently by the State Transport Department. This bridge was quite sturdy and was used by Aufferber and a lot of heavy traffic. Its pylons are encased in concrete. Access to it was cut off by a gate on a nearby road between Aufferber’s yard and the bridge itself. Aufferber for a time was given a key as were other people. Then mysteriously the bridge was declared unsafe. Even more mysteriously the Labor City Council in Brisbane, which is capable of almost anything anyway, wrote to Mr Aufferber in September 1975 to say that the limit of 3 tons would be lifted. This was signed by the City Council’s chief engineer. But no substantial maintenance work had been undertaken to justify this limit. Coincidentally it was made to appear on paper that the Commonwealth now declaring the Commonwealth bridge unsafe, could not further jeopardise Aufferber’s business. But in actual fact, of course, this was a gross obstacle to trading as Aufferber could not risk using the council bridge.

I have been under the bridge in company with Mr Col Lamont, my State colleague. I might say without seeming to boast that I know a reasonable amount about bridges. I was a bridge carpenter or a bridge builder for a number of years. On getting underneath the bridge we were able literally to tear off at will with our bare hands pieces of rotting timber off the girders, piles, head stocks and various other pans of the bridge. To say that the bridge was safe was in my opinion a gross misstatement, if one could call it that. Planks were missing and steel bolts protruded which could tear tyres- the best tyres that anyone could make- to pieces. Apparently the Commonwealth relied heavily on the fact that the council bridge had been declared back in commission.

I received a reply on 29 April 1976 from the Minister for Administrative Services (Senator Withers), the Minister responsible for this matter, which reads:

I regret it is not practicable to arrange for the free use of those roads which have been acquired by the Commonwealth and which have been closed to public use. These roads have been closed … to facilitate airport development. There are however public roads available which continue to provide access to wharves and elsewhere for businesses which are still operating in this area.

Some inconvenience may have been caused by the load limit imposed by the Brisbane City Council on the bridge on Brands Road. The Council has now confirmed that this load limit has been removed.

Senator Mulvihill:

– Who signed that?

Senator BONNER:

-It was signed by the Minister for Administrative Services, Senator Withers. I believe that the answer requires a great deal of comment. How did the bridge controlled by the Commonwealth Department of Transport suddenly become unsafe? How did the bridge controlled by the Brisbane City Council suddenly become safe? Without any maintenance, without any work being done on it, all of a sudden the bridge became safe when a month or so earlier it has been declared unsafe. In my humble opinion, it is still at this moment completely unsafe. I would not even walk across it, let alone drive a vehicle across it. Was it not a coincidence- and such a convenient coincidencethat the City Council reversed its earlier and long standing decision about no further maintenance to its bridge only one week before Senator Withers had to give his answer in the Senate.

I point out that the question was asked before the Council made its remarkable decision to declare unsafe the bridge about which I am talking. This question lay on the table for 29 days. Hence, we have the following scenario: My colleague, Senator Martin, asked Senator Withers about the Department of Transport’s bridge on 31 March 1976. Senator Withers did not answer the question and during that time, on 23 April to be precise, the Chief Engineer wrote to Aufferber advising of a Council decision to reverse the long standing policy about no further maintenance to its bridge. On 29 April, Senator Withers was able to get out of admitting gross inconvenience to

Aufferber ‘s business because of the Council’s timely decision. An example of that inconvenience to Aufferber is indicated in a letter from Brambles-Ruys Pty Ltd, a transport firm, to Aufferber in which the firm states that Aufferber had a buyer in Japan to take 3500 tons of scrap and also an agreement with a ship then in Brisbane to carry the necessary quantities- some 10 ton loads- over that City Council’s bridge that Senator Withers referred to in his answer. Now how can Senator Withers call that a small inconvenience? I personally do not know. In its letter, Brambles went on to say that not only was that deal lost but that it was unfortunate that its vessel could not be used because it is unlikely that it will be able to obtain such generous freight rates in the future. It may be thought that this curious tale of the bridges contains enough convenient coincidences to raise quite odious implications about government impartiality but indeed the coincidences, if not the plot, thicken further. About 18 months ago the State member for South Brisbane became interested in this case. Several initiatives taken by the government departments which tended to frustrate Aufferber ‘s attempts to trade seem to coincide with initiatives taken by Mr Lamont. He called on the offices of Messrs White and Voicy, the director and deputy director respectively of the Department of Administrative Services in Brisbane. For more than one hour, as Mr Lamont tells it, he was given what he describes as ‘a run-around’. He was shown aerial maps and told general stories which led him to believe that a couple of clever Commonwealth public servants were giving the run-around to one whom they apparently thought to be a country bumpkin. They did not know, apparently, that Mr Lamont spent 6 years as a detective inspector of police in Hong Kong and had been over the land shown in the map inch by inch.

At about the same time as he was querying the matter with Senator Withers, the Department of Transport decided to tear up the bridge. Mr Lamont ‘s file of letters tells an interesting tale, stating that he communicated his doubts about the reason behind the tearing up of the bridge to Senator Withers, implying that this was done just to ensure that Aufferber could not still sue for access. Then Mr Lamont threw another spanner into the works of this plot by asking what would happen if a plane crashed in the area beyond the bridge. Clearly, it is obvious, even to blind Freddie, that rescue vehicles could not get from the airport to the crash site if the bridge were torn up.

As a result of this inquiry and without any satisfactory answer being given the Department of Transport commenced the immediate reconstruction of the bridge. To say that the reconstruction was done in haste would be an understatement. It was completed in 3 days. This then raises the interesting question of how taxpayers’ money was wasted by the apparently spiteful but pointless tactical decision to pull up the bridge in the first place. Mr Lamont suggests openly that the destruction and subsequent rebuilding was a farce which centred on a Department desperate to avoid having to give Aufferber the access he needed but unable to justify its action when challenged. Mr Lamont verbally communicated his suspicions of corruption to Mr Voicey of the Department of Administrative Services in Queensland. Within 10 minutes of the conclusion of that telephone conversation, Mr Seymour of the Department of Transport was on the line to him to assure him that it was all a mistake but quite above board. He, in fact, invited Mr Lamont into the office of the Department to examine some maps and documents that were associated with the entire exercise. That is indeed a curious action, if nothing else. It tells of the closeness of the old boy network operating between departments involved in the frustrations of Aufferber’s business.

When the question of compensation arose the following series of events took place:

  1. Aufferber placed a claim for $6 1 1,8 12. This sum included compensation for land and for resettlement. Of this figure Brambles Industries quoted Aufferber a figure of $6.20 per ton to shift him to site offered originally by the Government. Brambles estimated that there was over 1 5 000 tons to be shifted and, therefore, quoted a total of$83,000.
  2. The Government offer amounted to $53,000 only, that is, about two-thirds of what it would cost to shift Aufferber’s scrap, not to mention his plant and equipment. In the first place, where would they shift them to?
  3. The Government was not offering an alternative site at this stage. Apparently originally the Government offered an alternative site in the Pinkenba industrial estate. Aufferber’s solicitor, who was one of the most highly respected gentlemen in his profession in Brisbane, sought to keep negotiations open for an alternative site. The site offered was near the wharves but was much smaller in size than Aufferber’s This offer included financial assistance to relocate his scrap, plant and equipment as well. This request seems to be a quite normal one. While these negotiations were still in progress the Department of Administrative Services withdrew the offer of any site at all on the grounds that this proposal was not proceeded with when it was realised that according to the trading figures made available by Mr Aufferber, his business was not a viable commercial proposition. This was on 19 February 1976.

How did the Minister’s advisers come to that conclusion? Compare it with the letter from Brambles-Ruys of 1 1 February, only 8 days earlier, when he was offered contracts to the sum of $150,000 approximately, allowing for fluctuations in overseas markets. Compare the Minister’s statement with that from the Bank of New South Wales which on 29 January 1976, one month before the Minister’s remarkable statement that Aufferber’s 1974-75 turnover- when he was last able to move scrap from his property in large quantities- was $2 1 7,000 and that was in overseas transactions only.

The same letter referred to a substantial export dealing by Aufferber prior to the beginning of 1974-75 financial year. Compare the Minister’s statement with the fact that right now tens of thousands of tonnes of scrap lie wasted on Aufferber’s property. To be more precise, some 4.9 hectares of property are literally covered with continuous mountains of scrap over 20 feet high. Compare the Minister’s statement with a statement given to Mr Lamont by the Queensland Deputy Director of Overseas Trade that Aufferber has the scrap, the ability to trade, the expertise and reputation second to none in the State of Queensland.

Finally, compare the Minister’s statement with the fact that despite all of the obstacles placed in his way, including the problems with the Department of Administrative Services and the Department of Transport Aufferber has still managed to keep a limited business going, pay all his debts, run an office close to Brisbane, pay wages to his staff, who incidentally have been with him for 16 years, and often without proper wages, trusting in the ability of Aufferber to succeed in the long run, and he has still been able to show a small profit. But this is a premature digression. I shall return to a summary of the man before I close.

Realising that $53,000 was a laughable figure, Mr Lamont sought the offices of Senator Martin to approach Senator Withers to commission an independent assessment of Aufferber’s business. Senator Withers agreed. Two highly reputable firms were commissioned- one to assess the value of the assets and the other to assess the value of the goodwill of the business. I admit that Aufferber used his accounts to his own benefit. For example, scrap is worthless unless there is a foreseeable market. Consequently few dealers will write it on as an asset at above its purchase price unless they can sell it. Thus a car body could be shown at a value of $20 only- the scrap price- whereas it sells as scrap for $40 or $50. Notwithstanding accounting anomalies of this sort, both assessors submitted reports. To this day Aufferber ‘s solicitor has been denied access to all of this.

What is more remarkable, however, is that the Government’s offer jumped from $53,000 to $ 1 1 5,000 which seems to me to be a most astounding variation. The Department’s assessment is $53,000 but a renewed offer based on an independent assessment becomes more than twice that amount. Surely that alone indicated something a bit tainted in the State of Denmark. But that figure, too, would only just cover the cost of shifting Mr Aufferber without giving him a site to which to shift. Never one to be satisfied with an obvious injustice, Mr Lamont refused to let the matter rest. Accordingly, he sought a personal interview with Senator Withers. What he said to the Minister in private I personally can only guess.

Senator Withers:

– Who sought an interview?

Senator BONNER:

-Mr Lamont. What he said to the Minister in private I can only guess at, although knowing his ability for straight talking and the letter he wrote Senator Withers prior to the meeting- I shall read that letter later- knowing the kind of talking of which Col Lamont is capable I am sure he would have been able to get the message across to Senator Withers at that time. Mr Lamont ‘s letter reads:

Some time ago I raised with Senator Martin a problem confronting my good friend . . . Mr George Aufferber. I am aware of the course of Senator Martin’s efforts through your good offices to secure justice for Mr Aufferber’s case.

Several aspects of the case cause me deep concern, not least of which is the overall fact that the policies of the Whitlam Government severely disadvantaged Mr Aufferber’s profitability and that the change of administration to our hands has brought no relief.

The disadvantage to Mr Aufferber has not brought any advantage to the Government nor has it brought any foreseeable potential advantage to the Government. The only profit in the play has been to Mr Aufferber’s major (if not sole) business rival. A serious question of propriety is implied.

As Minister you can only go on hard facts, but even these I suggest do not sustain the unwillingness of your officers in Queensland to advise the opening of access to Mr Aufferber’s property or the offer of alternative premises by way of compensation. Your officers in this State show no inclination to support any solution which would allow Mr Aufferber to re-commence his personal enterprise.

However, whilst you must weigh facts alone I, on the other hand, as a former Detective Inspector of Police am inclined to mount hypothesis on weight of probabilities.

I am impressed by reports of the very’ close personal relationship enjoyed by Mr Aufferber’s competitors and Mr Whitlam and his staff. I am further impressed by the extraordinary chapter of accidents which have plagued Mr Aufferber’s efforts to trade.

When I visited the office of your officers in Queensland, Mr White and Mr Voisey earlier this year I was led through a web of arguments and excuses which left me unimpressed and unconvinced. Indeed, I was most disappointed that your officers proceeded on the assumption that I had not done my homework. Accordingly they treated me to two hours of facile discussion and simplistic condescension.

Soon after your personal intervention in the question (and my visit to the Queensland office), the office of Mr Aufferber’s solicitors was burgled. The only thing missing was Mr Aufferber’s file. Other disturbing and curious incidents have followed.

A great deal of profit is at stake in the manner of resolution of this matter. Mr Aufferber cannot hold out forever against both Government and private competitors. A fact which some people seem to be relying upon quite heavily.

If my present, firm belief is wrong I could do innocent people a grave injustice. Hence, I would be most grateful for the opportunity to discuss this matter with you personally before I go to bat for Mr Aufferber in my own way as a back bencher seeking the final means open to defending the rights of a harrassed and worthy constituent.

Senator Withers:

– What is the date of that letter?

Senator BONNER:

-The date of the letter is 29 July 1976. It was subsequent to Mr Lamont ‘s visit to Senator Withers’ office that the Queensland Transport Department controlled bridge in Sugar Mill Road, the one that had been ripped up, was restored, and that Mr Lamont and Senator Martin began asking embarrassing questions about the about face. Indeed they still ask, and I still ask: Why was the bridge torn up in the first place if it was not for the purpose of staying Aufferber’s suit for access? After all, the need for the bridge was easily established. This claim was established clearly by the haste to rebuild the bridge when political questions were asked. But I have alluded to that already.

At this point another astonishing thing happened. Mr Lamont and Senator Martin had every reason to believe that Aufferber might now gain access to the reconstructed bridge and were warming up to establish that permission. But they under estimated departmental vindictiveness. Out of the blue a State machinery and works inspector appeared on the Aufferber’s side. He said he had received a complaint about a car press, which is one of those very expensive machines that reduces a whole car body to the size of a brief case. Mr Aufferber certainly had one but what we must know is that these presses are extremely expensive. When Sims introduced one in Sydney it received a large coverage in the Australian Press. Mr Aufferber has one that he built out of scrap metal. That of itself is incredible. But that is the sort of man Mr Aufferber is. Anyway, the inspector came to the site and immediately became embarrassed for some reason which he did not give. He then asked if he could telephone his office, which he did. He then became further embarrassed and apologised for his intrusion. He suggested that Aufferber’s crew should forget he was there. He said that there had been a mistake.

Mr Lamont made inquiries through the Minister’s office and discovered that the complaint against Aufferber had been laid by the Commonwealth Government. The obvious inference was that someone in the Commonwealth Department of Administrative Services or Department of Transport was worried that in spite of the extraordinary lengths to which they had gone to ensure that Mr Aufferber could not trade- by denial of access- he was now within reach of gaining that necessary access. Therefore, they had put the machinery inspector of the State department upon him. It was ascertained further that the substance of the complaint was that his press, firstly, was not built according to correct specifications and, secondly, was unregistered. The State department later agreed that these were not the sorts of reasons upon which objections normally were based. A top level investigation followed but it was obvious that the old boy net’ was to frustrate any hopes of pinning vindictiveness upon a Commonwealth public servant. Nevertheless, there was never any dispute that a Commonwealth officer had indeed initiated the initial complaint which caused Aufferber this further trouble.

As late as 9 February 1977 Mr Lamont wrote to the Minister once again. The relevant paragraphs- from paragraph 3 onwards- are:

Senator Withers:

– Read the first paragraph first.

Senator BONNER:

– This is my quote, Senator. The letter stated:

The reason I am still pursuing this matter on behalf of Mr Aufferber is because of the reports that I have received by the independent assessors that you appointed, who give me the strong impresson that they anticipated that the Department would resettle Mr Aufferber, thereby permitting him to continue to operate his business.

I am sure you realise that the offer that has been made by your Department, as it now stands, will close Mr Aufferber down. The sum offered will not be enough to enable him to re-site his business. Indeed, it will not even buy a comparable piece of land anywhere in the proximity of the Brisbane wharves.

Knowing this, Mr Aufferber’s competitors have recently made insulting offers to buy his scrap.

It is my deepest regret that the only people who seem to be able to gain anything from the fact that the Government has required Mr Aufferber’s land for its own use are Mr Aufferber’s main competitors in private enterprise. This fact still offends my sense of the philosophy that I believe we stand for.

Put bluntly, I am appealing to you to look at the case in these terms. Mr Aufferber was a trader. Because of the Government’s need to acquire the land where his business was situated, Mr Aufferber’s ability to trade was obstructed and then ceased altogether. Compensation offered by the Goverment is not enough to permit Mr Aufferber to resume trading. To me that is the simple set of facts which must be recognised. Needless to say, I regard these circumstances as repugnant to any sense of justice.

To compound matters, Mr Aufferber and those acting for him, including me, have been assured by the independent assessors here that they anticipated that resettlement of Mr Aufferber’s enterprise would be the logical outcome after they filed their reports. It is frustrating to know that these reasonable expectations have not been fulfilled. From the national point of view I suppose Australia stands to lose a great deal if Mr Aufferber is closed down.

Is it still possible that your Department can offer a piece of land such as they did earlier in the transactions? Your Departmental Officers here maintain that Mr Aufferber rejected that offer. Mr Aufferber’s solicitor strenuously denies that that is the case. I know that that offer would be accepted if your Departmental Officers here had not advised in favour of its withdrawal. I am still at a loss when I try to understand their motive.

Thank you once again for the amount of time you have given to this case and to my representations.

I am

Yours sincerely,

In view of the hour, perhaps I should speak a little more about the person concerned. Mr Aufferber is a remarkable man. I think it is relevant that I say something about him. Apart from all he has suffered here in Australia, I want to talk about what he suffered before he came here. I repeat: Mr Aufferber is a remarkable man. He lived in Europe before the war. He was interned by the Germans. He survived, and indeed escaped from, a German concentration camp. He fled to Russia. There, refugees were treated worse than in Germany. He survived that experience and found himself in Hungary after the war. He could not abide the Russian occupation of his country and so escaped once again. He assisted in the escape of others through the underground. He arrived in the free world with nothing but his clothes and he was grossly underweight. He rehabilitated himself in Italy where he married. Ultimately he came to Australia, seeking at last a land of freedom and opportunity and, most of all, a place where his labours could reap reasonable rewards.

Three times he failed in business and had to begin again from scratch. His big chance came when he won the contract to draw the old Breakfast Creek bridge- the bridge that visitors passed over on their approach to the city of Brisbane. He was approached by the Sims Metal company which wanted to buy his scrap from the bridge project at a price which he knew was a steal. He decided to market the scrap himself. He was told by the Sims company that he would never get an export licence but he thought that this was just reckless talk. Three times his application for an export licence was refused. Finally he created such a fuss that a senior officer in the then Department of Trade and Industry intervened at the desk one day. It transpired that his application had never been processed. The man who had interviewed him constantly had, subsequent to each interview, apparently obstructed the application. He resigned overnight. That man found a job with the competitor within the week. Aufferber got his licence.

Subsequently, Aufferber decided to import a crane to assist him with his new business. It was to be shipped from England. On one occasion, the crane itself was offloaded before it left the last English port. On another occasion the crane arrived without the necessary magnet essential to its efficient operation. Ultimately, the firm selling the equipment had to air freight the remaining parts. On investigation, it was found that the shipping company was controlled by Patrick Ltd, whose chairman was also the chairman of the board of the Sims Metal Company- an unfortunate coincidence, one might say. On another later occasion Aufferber had his scrap at the wharves, only to be frustrated in his attempt to export by the Department of Customs and Excise Department which raised a minor technicality. On that occasion he was able to call on his new contacts at the Department of Overseas Trade and they got him out of the dilemma. More recently, and particularly since State and Federal members have been interested, Aufferber has had -

Senator Keeffe:

– I take a point of order. I think it might help the honourable senator, seeing that he is reading from copious notes, if he seeks leave to have the documents incorporated in Hansard. I will not object.

The PRESIDENT:

– There is no point of order. Does the honourable senator wish to incorporate the material he has?

Senator BONNER:

– I have only one page to go. I would prefer to read it. More recently, and particularly since State and Federal members have been interested, Aufferber has had more irregular setbacks. His solicitor’s office was broken into. The only thing stolen was Aufferber’s file. That coincided with Mr Lamont ‘s intrusion into the case. Clearly someone wanted to know the extent of that intrusion. Aufferber’s largest truck was blown up. There were no witnesses and the police could do nothing. Aufferber’s watchdog was shot on the premises of the scrap metal yard.

Another scrap dealer in Brisbane attests that he received a strong suggestion to give an opinion that Aufferber’s business was not viable because of the makeshift nature of the equipment upon which Aufferber was relying. He refused to do so, but there is nothing by way of hard evidence to go on in spite of his insistence that the suggestion was made strongly in a context that could affect his future. Sims was a member of the Whitlam entourage which went to Japan and China. Honourable senators should remember that all this began during the Whitlam regime.

I think those remarks are sufficient to show that this man has suffered greatly. He came to this country because he believed he was coming to a free country, a country that believed in free enterprise. He came to a country where he believed that a man, by the sweat of his brow, by his own initiative and by his own hard work, could get somewhere in life. All he has had in these last few years, particularly since 1972, has been constant frustration by people who should be assisting him in every way to carry on his business. I hope that having given this matter a bit of airing here tonight something can be done for a man who I believe is worthy of calling himself, as he does, a true blue Australian.

Senator HARRADINE:
Tasmania

– This week a decision was made by the Interstate Executive of the Australian Council of Trade Unions which is momentous indeed and which will have great significance and farreaching effects on the future of industrial relations in the whole of Australia. The decision raised the real possibility of a mass deregistration of unions which would leave the Australian federal system of conciliation and arbitration in tatters. It was a momentous decision, a decision which was unusual and unique for the ACTU Executive to make. Successive ACTU congresses have considered this question and over the last 30 years have rejected attempts by the proCommunist Left to force the Australian trade union movement out of the system of conciliation and arbitration.

The history of the conciliation and arbitration system shows that its inception was supported by the trade union movement and opposed by the employers. The people of Australia have supported this system. The only time that it was put to the test was in the election held in 1929 or 1930 when the then Prime Minister, Mr Bruce, went to the people on a platform of abolishing the system of conciliation and arbitration. He was roundly defeated in the electorate. A Labor government was installed in office and Mr Bruce, ironically, was defeated by the secretary of the Melbourne Trades Hall Council, who stood for the system of conciliation and arbitration. It is a system for which I have fought within the councils of the trade union movement over the 22 years of my being a trade unionist. It is indeed a saddening day when one sees a decision of this momentous character being forced upon the Executive of the Australian Council of Trades Unions by certain factors that I will enumerate.

The Government cannot say that it was not forewarned that this would happen. It was forewarned indeed, but those warnings fell on deaf ears. I warned the Government that this would happen. I warned it as far back as 17 March of this year in a speech that I made to the Senate on that date. As I said on that occasion, it has been a long-standing aim of the procommunist Left to destroy Australia’s system of conciliation and arbitration. We now see that because the Left is aided and abetted in its aims by this Government the rest of the trade union movement has been forced into a situation where there is raised the real possibility of mass deregis- tration of registered industrial organisation. I made that warning on 21 April. My warning was contained in an address on a matter of urgency when I had this to say:

In those circumstances many unions are questioning the merit of continued registration under the Conciliation and Arbitration Act. Those unions are not confined to the extreme Left, unions which have traditionally had an attitude that there should be no system of registration.

That warning obviously fell on deaf ears. What are the circumstances that I refer to when I gave that warning? I said:

The Government has been advised that the concern for the continuance of the system of union registration and enforcement of rules stems from the meddling by governments with the Conciliation and Arbitration Act since 1972, the confusion caused by judges of the Court -

The Australian Industrial Court and now the Federal Court- in using the absolute discretion given by certain sections of the Act and the very different attitudes which particular judges bring to bear on the same set of facts or, alternatively, on what is their view of the needs of a properly functioning trade union.

The Government has been told all this, either verbally or in correspondence-all for naught.

Again, I raised questions month after month on circumstances arising from one such Australian Industrial Court decision, namely B 55 of 1976 which was handed down on 23 December last year. I asked a question of the Minister representing the Minister for Employment and Industrial Relations on 23 February. Specifically, that question dealt with that particular decision. I reminded the Minister that the Minister for Employment and Industrial Relations, Mr Street, and, indeed his predecessor, Mr Clyde Cameron, gave assurances to the Parliament. Mr Street gave an assurance on 1 June 1976 that registered industrial organisations need not amend their rules to conform with the 1973 amendments to section 133( 1) of the Conciliation and Arbitration Act because they had until 13 November 1976 to do so and, by that time, the Government intended to amend the Act. I asked the Minister whether he was aware of the decision in the Court and that the decision showed that the assurances given by the Minister for employment and Industrial Relations were absolutely worthless. Those unions who took his assurances at their face value and operated under them and a large number of other unions, because of the judgment, now find that even though they amended their rules, those rules could well be under challenge. Those unions which cover over 1 000 000 trade unionists now have rules whose validity can be challenged.

I asked the Minister what urgent steps were being taken to enable the Parliament to remedy the situation resulting from the Court’s interpretation of section 133 (1 ) (a) before its repeal and the ineffectiveness of the amendments of 12 November 1976 to sections 4 and 133 as a consequence. That was on 23 February. I raised the matter again in the Address-in-Reply debate on 1 7 March. I raised it again in a question on 22 March and again on 20 April. Need I say more? I have been doing it month after month. I refer to the question which I raised on 20 April. I said:

I refer the Minister representing the Minister for Employment and Industrial Relations to a question which I asked him on 23 February 1977 and to a further question on the same subject I asked on 22 March 1977 which related to assurances given by Mr Street and by Mr Cameron to unions concerning amendments to rules. Such assurances were found to be completely worthless by a decision of the Australian Industrial Court 4 months ago on 23 December 1976. On 22 March 1 977 the Minister promised to expedite an answer. Can the Minister please now advise what action the Government will take to set right the situation caused by the assurances given by the Government?

Mr President, I want you and the Senate to realise that I do not reflect on Senator Durack, but Senator Durack on that occasion said:

I am aware of the questions that Senator Harradine has asked and of the concern he has about this matter. I have passed his questions on to the Minister whom I represent. I have also had some discussions with the Attorney-General in regard to the matter. At this stage the Government is not in a position to say what action, if any, it is proposing to take. The matter is certainly under consideration.

I asked a supplementary question as follows:

I wish to ask a supplementary question. It is now 4 months since the decision; when can I receive an answer to the specific matters mentioned in the questions I asked?

Senator Durack answered:

I am afraid I cannot add anything more to the answer I have given.

In addition to that I raised in debate the matter of my being misled by the Attorney-General (Mr Ellicott). Senator Wright and other senators on the Government side asked why I raised a matter of urgency on 2 1 April as it dealt with the Bill to establish the Industrial Relations Bureau. They asked why I could not have written to the Government. It is no use writing to the Government because on important industrial matters I wrote to the Attorney-General on 26 August- I have some experience in industrial affairs and the running of registered industrial organisationssetting out in detail some of the sections of the Conciliation and Arbitration Act which I believed should be seen to. They were sections 171D and 171c and sub-sections (2) and (3) of section 141. I detailed a number of comments about these and general comments about the scheme of the legislation itself. I received an answer on 26 January 1977 in which the Attorney-General referred to my letter and said:

You will recall that sub-sections (2) and (3) of section 141 were inserted in the Act when the High Court found that the Industrial Court did not have the power to freeze funds involved in a Union amalgamation. I would not favour the repeal of sub-sections 141 (2) . . .

I was startled to receive that letter from the first law officer of the Crown because, though I am not a lawyer, at least I knew immediately that the statement that he had made was incorrect. So I wrote to him on 9 February 1977 referring to his letter and saying:

I was surprised to read in your letter that you seem to be under the impression that sub-sections (2) and (3) of Section 141 were inserted in the Act when the High Court found that the Industrial Court did not have the power to freeze funds involved in a union amalgamation.

The decision in that case was brought down on 7 June 1972, 5 days after the Act Number 37 of 72 was assented to, and months after the Government had decided to proceed to amend that particular Section.

Here we had the first law officer of the Crown replying to a letter which I had spent a good deal of time preparing, passing it off by saying that the Act was amended because of a High Court decision, when any infant in the industrial arena knows that that was not the case. So much for my writing to the Government to try to detail the amendments which ought to be made to the Act to ensure that the people responsible for the proper, efficient and effective functioning of a registered industrial organisation can achieve that objective.

The proximate reasons for the decision of the trade union movement are those that I have mentioned and the proposals to amend the Trade Practices Act and the proposal to establish the IRB. The latter proposal is said by the Government to be necessary to enforce obligations and to protect individual rights. In a detailed speech to the Senate on 2 1 April of this year I submitted proof that the IRB Bill, rather than enforcing obligations, is an invitation to anarchy and irresponsibility. Rather than protecting individual rights of union members, they are diluted by the intrusion of the Industrial Relations Bureau between the individual union member and the Court. Under sections 140, 141 and 143 the individual union member can seek redress directly from the Court. The Government is proposing to dilute that individual right enshrined in the current legislation by the intrusion of the IRB between the member and the Court. The Government contends that if the IRB says that the member’s complaint is without foundation the member can still go to the Court. As I pointed out in the speech to which I referred, what if the member saw a breach of the rules taking place and wanted to seek orders from the Court for the performance and observance of the rules of the union in a particular fashion? Under the new proposals, that complaint would have to go through the IRB. What if the IRB said: ‘Yes, but I do not think you should say it this way; you should say it another way’? The member could be arguing with the IRB. The IRB need not say that the complaint is without foundation. Thus the rights already enshrined in the legislation would be taken away from individual members.

I gave the Government warning about this matter on 2 occasions. Apparently it fell on deaf ears. The ACTU Congress, which is the supreme governing body of affiliated unions, will meet on 12 September. Unless the Government heeds what is being said, it is obvious that a decision will be taken at that meeting recommending mass deregistration of unions.

Thursday, 5 May 1977

Senator DURACK:
Western AustraliaMinister for Veterans’ Affairs · LP

Senator Harradine canvassed a wide range of matters concerning conciliation and arbitration laws. I think almost all of them have been raised by him on a number of occasions in the Senate in recent months. The matter which I think he has raised most frequently is the one dealing with collegiate voting and the amendments to section 133 of the Conciliation and Arbitration Act which were passed by this Parliament at the end of last year. He referred to statements made by the Minister for Employment and Industrial Relations (Mr Street) and by myself on his behalf, and indeed by a former Minister, Mr Clyde Cameron, that unions had a period of 3 years in which to comply with what is known as the Cameron amendments, which were being considerably altered by the legislation before the Parliament last year. That legislation was passed by the Parliament on the assumption that changes to union rules could be made within the period of grace which was given to those unions affected by the Cameron amendments. The unions had to comply with the amendments passed by the Parliament in November last year.

Those assumptions made by the Government and by Mr Cameron, the Minister in the previous Government, do not accord with the decision given by Mr Justice Smithers in the Industrial Court in December last year. Senator Harradine has asked what the Government intends to do about this matter, and he has detailed all the questions he has asked. The fact is that the Government has been concerned by the decision. The Minister and the Attorney-General (Mr Ellicott) have been considering the decision and whether it is a correct one. When all is said and done, the mere fact that one judge makes such a decision does not necessarily mean that it is one which will find favour with other judges or with appeal courts. I am not sure whether there is going to be an appeal from the decision. That is a matter for the parties. However, the Government is concerned to know whether it is really necessary to bring down further amendments to the legislation. Those are difficult matters and, as I have said, they are being considered by the Minister and by the Attorney-General.

I have spoken to both the Minister and the Attorney-General about the matter. Indeed, I spoke today to the Minister about this matter, not knowing that Senator Harradine was going to raise it tonight but simply in the course of the interest I am obliged to take in it as a result of the questions Senator Harradine has asked. The Minister indicated to me today that he has been obtaining further legal opinions in regard to the matter. He had hoped to be able to provide an official Government statement a couple of weeks ago, but he was not satisfied with the position as it was then from the advice he had received and he has obtained another opinion. It is those matters and those complications which have caused the delay that is upsetting Senator Harradine and no doubt is concerning a number of other unionists. I am sorry about that and so is the Government, but the fact is that these matters do take time.

Senator Harradine also raised the question of correspondence he has had with the AttorneyGeneral about other sections of the Conciliation and Arbitration Act. I am concerned to learn from what Senator Harradine said tonight that he has not received a further reply from the Attorney-General. I have discussed these matters with the Attorney-General and I have seen a draft of a reply which I expected would have reached Senator Harradine by now. I can only say that I will take up that matter further with the Attorney-General and find out what has happened to the reply. Senator Harradine raised a further, and I am sure he would agree a much more fundamental, issue relating to the Industrial Relations Bureau and the reaction to it by the trade union movement. I was very sorry to hear him say that the Australian Council of Trade Unions Council has decided to make recommendations to the ACTU Congress in the event that the Government proceeds with this legislation. Now is not the time and place to debate the Industrial Relations Bureau. A Bill to set that body up is before another place. It will be debated there shortly. It will be debated in the Senate in the coming weeks. I do not think Senator Harradine would expect to anticipate that debate, although he does seem to be making some attempt to do so because this is the second occasion on which he has raised this matter in debate in the Senate.

The fact remains that the Government’s policy in relation to the Industrial Relations Bureau has been one of the clearest and most important policies of the Government. It was clearly detailed in the policy on which the Government went to the people in 1975. The Government was elected with a clear mandate from the people to establish this Bureau. The Government has given a great deal of thought and attention to the matter because it is only now that it has brought forward the legislation. The legislation has been brought into the Parliament. It has been lying and will continue to lie in the table for some period to enable interested parties to express their views on aspects of it. Some questions which Senator Harradine raised this evening about the legislation are matters which I certainly would have expected him to raise with the Minister. Perhaps he has raised them. They are the sorts of comments and suggestions which the Minister would hope to obtain in relation to the legislation. That is one matter. But it is another matter altogether to be taking the attitude which is apparently being taken by the ACTU and by some of the militant left wing union leaders. Senator Harradine said that he warned the Government about that attitude. The fact is that those threats have been made by union leaders. But they are making threats against a decision of the Government supported by the people of Australia. There is no question whatever that this Government will bow down and knuckle under to threats of that sort, whether or not Senator Harradine thinks we ought to. The fact is that this legislation will proceed during this session of Parliament. After that, the unions and union leaders who are making these threats will have to consider their position.

Senator WITHERS:
Western AustraliaMinister for Administrative Services · LP

– Earlier in this sitting day Senator Walsh raised a matter concerning immigration. I give him the assurance of the Government that the matter will be referred to the Minister for Immigration and Ethnic Affairs (Mr MacKellar) for his urgent consideration. Also, earlier this sitting day, my friend and colleague Senator Bonner raised a matter involving a constituent of his in Queensland. I shall deal with the matter as briefly as I can. Honourable senators will understand that the case put down by Senator Bonner took some 40 minutes. I say that not in a critical sense but in justification for the fact that I will be a little time in replying. I shall be as brief as I can. I assure Senator Bonner that I and the rest of my colleagues in Government have just as keen an interest in the upholding of Liberal principles and the pursuit of truth and justice as has he or as have any of his Queensland Liberal Party colleagues. I do not think that any of us would claim to have a monopoly over these principles but I think it is fair enough to say that we all have a deep and abiding interest in them. I first took a personal interest in this matter as a result of personal representations made to me by Senator

Martin. May I say that as a result of those representations I did not do what tends to be usual- that is, just have a departmental opinion given on the matter. I actually went through the total file, which is some inches thick.

I have had some experience in assessing the truth or falsity of what is in departmental files or files of any sort. I realise that Mr Lamont may have been a detective-inspector for 9 years in the Hong Kong police force but I also have had some experience in trying to ascertain the truth or falsity of what occurs in certain matters. As I have tried to make clear from the very beginning since I became involved in this matter, my powers and obligations in respect of it are those set out in the Lands Acquisition Act, an Act of this Parliament by which I am bound, as is every other person in the community. I have certain powers under that Act but I also have certain obligations. Under that Act a person whose land is compulsorily acquired has certain rights.

It is not my Department which determines the value of land. We seek that advice from the valuers of the Commonwealth Taxation Office. I hope that nobody is making allegations that there is something improper about the valuation supplied to my Department by the valuers of the Taxation Office. In fact, some of the valuations supplied in recent times have been tested before the High Court of Australia. Remarkably, as anybody who has had any experience in the valuation field would know, the High Court in fact has been finding almost in line with the valuations established by the Commonwealth Taxation Office. When I say ‘almost in line’, I point out that a variation of 10 per cent in valuation matters is looked upon as being almost in line.

Once my Department receives a valuation from the Taxation Office, because of Treasury regulations, the Audit Act and Treasury directions I have no power to substitute another value for that valuation and nor should I have the power. I think it would be quite improper for Ministers of the Crown to dispose of public moneys other than on a certificate, document or certification supplied by the valuers of the Taxation Office. An offer having been made as to compensation, if the person concerned is dissatisfied he has the powers and the right- he has the constitutional right what is more- to apply to a court to have just terms determined. Such claims are determined, depending on where the claimant wishes to commence the action, by senior judges of this nation. That is the proper place for disputes about valuations to be determined- not in discussions between colleagues of mine and me or between the person from whom the land is compulsorily acquired and me. I think that that ought to be quite clearly understood.

Because of the representations by Senator Martin, who has been very active on behalf of her constituent, I took the somewhat unusual course of asking my Department whether it would have an independent valuer look at the valuation- somebody from outside the Taxation Office. This is done occasionally. Because of my intervention, a firm of valuers, consultants in Brisbane, was employed to put a value upon the property. It put a value upon it and that has been supplied to my department. One of the complaints of the dispossessed owner is that we are not prepared to make that valuation available to him. We obtained that valuation for our purposes. As a result of that valuation, we saw no reason to do other than offer again the sum which has been offered to Mr Aufferber

I think I ought to say- I would not have got into this subject if it were not for some matters raised by Senator Bonner- that there have been continuing allegations about what might be considered doubtful, if not improper, practices by officers of my Department, the Department of Transport or the Brisbane City Council concerning this whole matter. I take those allegations quite seriously because I believe that one of the fundamentals of a free and democratic society is an indepedent and totally honest Public Service to service the needs of government in the country. Mr Lamont in, I think, January of last year made certain allegations which if they could have been substantiated would certainly have led to suspension and most likely dismissals of officers from the Commonwealth Public Service and most likely prosecutions under the Crimes Act. They were of that nature. As a result, I had a long discussion with my permanent head and we sent from Canberra to Brisbane a very senior Second Division officer to investigate the allegations made by Mr Lamont. That officer is a very senior, very competent and able person. To give some indication of his capacity, he is one of the few officers selected by the Public Service Board to undergo training at the Australian Staff College in Victoria. He is at present receiving that training. He is a man of great capacity within the Public Service. Having spent some days in Brisbane looking at both the instant allegations and over the whole range of allegations, that officer could find no truth in any of those allegations. When Senator Bonner was quoting from Mr Lamont ‘s letter to me of 9 February I suggested to him that he should read the first and second paragraphs, but he said that he preferred to start at the third paragraph. I think that I should now read the first and second paragraphs from the letter dated 9 February 1977. The letter reads:

My dear Minister,

May I begin by thanking you sincerely for the interest you have shown in the case of my constituent, Mr George Aufferber, and also for making the decision to send investigators from Canberra. Unfortunately for the case that I represent, evidence which I hoped would be elicited on that occasion was not forthcoming

As you may know, neither Senator Martin nor I was able to be present at the Interview of the State Machinery Inspector and therefore I am unaware of the complete details of that interview. I fear that the impression given by the Inspector to your investigators was different to the impression given to Mr Aufferber by that Inspector when he visited Mr Aufferber’s yard.

I do not know how he can say that unless he was present as a witness when that conversation took place. If anything is a hearsay inference, that is. The letter goes on:

That, however, is unfortunate and now must be regarded as water under the bridge. The point that we on our side of the case had clung to is now irretrievably lost.

The letter on the second page concludes as follows:

Thank you once again for the amount of time you have given to this case and to my representations.

So I do not think it can be claimed that I as the Minister in charge of the Department have not taken a keen and deep interest in this matter and have not done all that I have been able to do to investigate all the matters that have been raised. I think it is fair to say, as I have said all along, that if Mr Aufferber is dissatisfied with the offerthat is all it is, an offer of compensation made by my Department on proper advice- he has his constitutional right to resort to the courts and have the matter properly determined. It is not a matter in which I should interfere or take some administrative decision which, quite frankly, I have not the capacity to do. Even if I had, I would not do it. I believe that Parliament has quite deliberately set up procedures to determine matters between the Commonwealth Government and its citizens in cases such as this. I think the whole matter has gone on for a very long time. As to the matter of the bridges, I can say what I said to Senator Martin in a letter dated 2 1 February. I do not think she will mind my reading from that letter which I wrote to her. I said:

As advised earlier, the bridge which Mr Aufferber wishes to use is within the boundary of the existing airport. I understand that the restrictions on its use have been introduced as pan of the management of the airport. In the circumstances I have referred your representations in this regard to the Hon. P. J. Nixon, M.P., Minister for Transport, for his consideration.

I have been urging my colleague, the Minister for Transport, to do what he can; but it is not for me to interfere in what my ministerial colleague does. If he has reasons which relate to airport management or otherwise, they are matters for him to disclose. I reiterate that all of the allegations which have been made about wrongdoing, all of the imputations which have been cast upon officers of my Department or other Commonwealth officers in Brisbane, were investigated at my instigation by a very senior Second Division officer from Canberra who is not connected with the Property and Survey Division of my Department. I have total faith in his honesty and his probity. He could find no evidence of what was alleged. He was available to have all of this put before him. We had been unable to find anything.

I repeat that Parliament has quite deliberately said that the manner of resolving disputes between the Government and citizens as to the proper compensation to be paid lies with the court. I have been urging Mr Aufferber to exercise his constitutional rights. It is none of my business whether he proceeds to the court. As I understand it, the present position is that my Department, of its own volition, has instructed the Deputy Crown Solicitor to issue a writ in the High Court of Australia- we are going to do that- for the determination of the compensation. The High Court is the place to judge whether the scrap metal is worth a certain figure or whether a certain figure should be awarded for disturbance, severance, compensation, relocation and all of the other matters that arise in ascertaining the proper amount of compensation to be paid to a citizen. I think the High Court is the proper place for that to be determined and I would not have it otherwise.

Senator MARTIN:
Queensland

-I have no wish to prolong the agony unnecessarily either for the Minister for Administative Services (Senator Withers) or for the Senate. I just wish to make a couple of points quickly because my name was mentioned a couple of times. I appreciate the efforts that the Minister has made in relation to this matter, but I am not satisfied with the answer he has provided tonight. As the Minister is aware, I have not been satisfied with all the answers I have received in the past. I have not personally made any allegations of impropriety. I have observed- I do not believe in writing but I will make this observation in public now- only that an extraordinary series of events has taken place in this case which is difficult to explain. I had the opportunity to have discussions with the investigators after they had investigated the situation in Queensland. It is true that alternative explanations can be given for all those events, but nobody has any way of deciding which is the correct explanation. The simple fact is that this man apparently had a viable working business 4 years ago. He is now completely unable to operate that business.

I appreciate far more the efforts of Senator Withers than I do those of Mr Nixon in this matter. It would be possible for this man to be trading and fulfilling contracts for scrap metal if he were allowed access to his property and if he were allowed access from his property to the ports. Because of the saga involving roads and bridges and all sorts of other things- it seems to me to involve the most incredible bungling at all levels of government- this man has scrap metal sitting on that property. He has very expensive and very specialised machinery sitting there which he has been unable to operate effectively for several years now. He is a self-made man. He does not have large corporate resources behind him. He has been all but broken by this process of bungling.

The saga started back in the 1960s when an indication was given that his property might be resumed for airport extensions. After some correspondence and negotiation with the then Government he was told quite definitely in a letter that this would never happen. In early 1973- the advent of the Whitlam Governmenthe found suddenly that all the expansion process he had taken, all the investment in plant and very heavy equipment which is very difficult and expensive to move, all those decisions which were taken on the basis of an assurance by the previous Government were for nought. He was just told that his property was to be resumed.

Let me state very briefly the reasons why I think Mr Aufferber has reason not to be quite so sanguine about action in the High Court. I do not have any of the correspondence with me. I have been caught a little on the hop by this matter tonight. But as I recall, there was an offer from the Commonwealth Government at one stage to resettle him on an alternative site and I think that there may also have been some offer in relation to the cost of resettlement. (Quorum formed)

I said when I rose to my feet that I would speak for probably 5 minutes. I think I had been speaking for 3 minutes when Senator Cavanagh brought my colleagues out from their offices at this hour of the night. I shall not extend my comments, in spite of the provocation I have just been offered. I was stating that an offer was made. Mr Aufferber wanted to negotiate in relation to the cost of transport and of transferring the business. At that point the Government withdrew its offer. One might think in retrospect that that was a foolish decision and that he should have accepted that offer because it was infinitely superior to any he has since received. Again I find some difficulty in recalling off the top of my head what were the figures of subsequent offers but I think they went from $ 1 50,000 to $ 1 25,000. Mr Aufferber has been offered, apparently on the basis of objective and excellent advice, 3 quite different means of compensation. In fact I believe that the land that he was offered originally is valued unofficially at something like $500,000 which gives some indication of what it would cost him to transfer his business to an appropriate corresponding site and some indication of why he would now quite rightly feel unhappy at being offered $125,000.

Everyone is aware that Mr Aufferber has recourse to the courts. I would have hoped that matters such as bridges and access to ports would not have to be determined by courts but that they could be determined by Ministers of this and the previous Government on a reasonable basis. Mr Aufferber ‘s ability to contest in court, indeed his access to the very documents which will determine his fate, is very much open to question. I have never suggested that the Minister or his officers have acted improperly, although I must say the question has never been resolved in my mind and it remains unresolved. I think it was quite appropriate for Senator Bonner to raise this matter during the adjournment debate. I repeat that I do not think the answers have been given yet.

Question resolved in the affirmative.

Senate adjourned at 12.46 a.m. (Thursday).

page 1167

ANSWERS TO QUESTIONS

The following answers to questions were circulated:

This Day Tonight Program (Question No. 66)

Senator Colston:

asked the Minister representing the Minister for Post and Telecommunications, upon notice, on 22 March 1977:

With reference to the Minister’s reply to a question without notice from Mr Peter Johnson M.P., in the House of Representatives on 9 September 1976 (Hansard, page 859), relating to the This Day Tonight television program on Cedar Bay screened on 7 September 1976, has the Minister concluded his inquiries. If so, does the Minister agree that, in the light of subsequent information that has come to light, the This Day Tonight program was an objective and balanced coverage of the Cedar Bay raid.

Senator Carrick:
LP

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

I have concluded my investigations into this matter and have received the necessary background information from the Australian Broadcasting Commission. The Commission has indicated that it was their firm intention that the program concerned should be an objective and fair report on the Cedar Bay controversy.

You will also be aware that the ABC as an independent statutory authority, exercises full responsibility for its programming standards, and the objective presentation of news items, and therefore it would not be appropriate for me to assume an editorial position on this issue.

Tourist Industry: Investment Allowance (Question No. 98)

Senator Colston:

asked the Minister for Industry and Commerce, upon notice, on 9 March 1977:

Is the tourist and accommodation industry ‘virtually unable to take advantage’ of the 40 per cent investment allowance as claimed by the Queensland Minister for Tourism, Mr Hodges, in the Courier-Mail of 19 February 1977. If so, (a) why, and (b) does the Minister see any likelihood of his Government being able to provide further assistance to the tourist industry via a relaxation of restrictions on the use of the investment allowance.

Senator Cotton:
LP

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

The tourist accommodation industry is able to take advantage of the 40 per cent investment allowance. There is, however, a monetary limit which excludes items of plant or equipment costing $500 or less. This means that many items of tourist accommodation plant that would otherwise qualify for the allowance, e.g. beds, chairs, tables, television sets, are excluded by the operation of the monetary limit. This monetary limit applies generally to all industries.

The use of a monetary limit to exclude comparatively lowcost items is based on a number of considerations:

The allowance is intended primarily as a stimulus to investment in plant that is depreciated over a number of years. Many small items of plant qualify for outright deduction on a replacement basis. The allowance is not designed as a concession for expenditure that is fully deductible in the year it is incurred.

Another consideration is that the very large cost of the allowance would be expected to have its greatest impact on investment if it is spread over expenditures on substantial items of plant.

The earlier investment allowances provided for the specific exclusion of a large range of small items. With the new allowance extending more broadly, this approach is not considered feasible and the monetary limit is used to achieve roughly the same result.

The present investment allowance was introduced as an incentive to business to re-equip and expand by investing in new productive plant, thereby lifting economic activity and employment opportunities.

Consistent with this objective, and given the necessary revenue constraints, non-productive plant and equipment including sporting, recreational, amusement, gambling and entertainment plant was specifically excluded from trie allowance. There is also a general exclusion of furniture, furnishings, fittings and domestic appliances except where these items are used in the tourist accommodation industry.

As the specific exclusions of plant for sporting, recreational, amusement, gambling and entertainment purposes impinge substantially on tourist industry activities, it means that, apart from the accommodation sector, much of the tourist industry is virtually unable to take advantage of the allowance.

Representations by the tourist industry, along with representations from other sources, seeking relaxation of the terms of the allowance were considered by the Government in its deliberations on the 1976-77 Budget. As announced by the Treasurer in his Budget Speech, the Government decided that the present scope of the allowance should remain unchanged.

Crude Oil Imports (Question No. 197)

Senator Keeffe:

asked the Minister representing the Minister for National Resources, upon notice, on 8 March 1977:

  1. 1 ) How much crude oil has been imported into Australia for each of the past 20 years to meet Australia’s requirements for(a) heavy crude by-products, (b) lubricants and (c) petroleum.
  2. What percentage of Australia’s total requirements for each of these 20 years do these figures represent.
  3. What is the predicted annual requirements for crude oils that will need to be imported for each of the next 1 5 years.
  4. What is the likely cost of these annual imports for the next 1 5 years.
Senator Withers:
LP

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

  1. 1 ) It is not possible to allocate the production of any product to a particular crude as every crude oil gives rise to a wide range of products depending upon the processing plant installed and the market demand. The quantity of crude oil and other refinery feedstock imported into Australia for each ofthe years 1957 to 1976 was as follows:
  1. In addition to products derived from the above imports, Australia’s requirements of heavy crude byproducts, lubricants and petroleum were supplied by direct imports of finished products.
  2. For each of the years from 1957 to 1976 imports of crude oil and other refinery feedstock, expressed as a percentage of total input to refineries, was as follows:
  1. See forecasts of Australian production and demand published in Chapter 5 of the Fifth Report of the Royal Commission on Petroleum.
  2. In the quarter ended December 1976, the average landed cost of crude oils imported into Australia was $9.94 per barrel. There has since been a 5- 10 per cent increase.

Using these costs as a base, estimates of future costs of imports could be made by applying these to the forecasts in Chapter 5 of the Fifth Report of the Royal Commission on Petroleum.

DM Minerals: Former Employees (Question No. 297)

Senator Colston:

asked the Minister representing the Minister for Employment and Industrial Relations, upon notice, on 15 March 1977:

  1. 1 ) How many persons lost their jobs as a result of the shutdown of the DM Minerals sandmining activities on Fraser Island.
  2. How many of the persons listed in (1) have so far found alternative employment.
  3. How many of the persons listed in ( 1 ) have sought the assistance ofthe Commonwealth Employment Service.
  4. How many of the persons listed in (2) were assisted by the Commonwealth Employment Service in locating their new job.
Senator Durack:
LP

– The Minister for Employment and Industrial Relations has provided the following answer to the honourable senator’s question:

  1. 1 ) Two hundred and fifty.
  2. My Department is unable readily to determine how many ofthe 250 persons mentioned in ( I ) have so far found alternative employment because only a proportion sought help from the Commonwealth Employment Service. Only 1 7 persons of the original number who sought CES assistance are still registered as unemployed with the Maryborough Office of the Service.
  3. One hundred and thirty.
  4. For the reason indicated in (2) this information is not available. However of the 130 persons who sought CES assistance 70 have been assisted by the Service in locating new jobs; 14 of these have been relocated to other areas under the provisions ofthe Relocation Assistance Scheme.

Commonwealth Employment Service (Question No. 357)

Senator Colston:

asked the Minister representing the Minister for Employment and Industrial Relations, upon notice, on 22 March 1977:

What is the number of Commonwealth Employment Service officers, and the time involved per month, in the collection and dissemination of the official unemployment statistics.

Senator Durack:
LP

– The Minister for Employment and Industrial Relations has provided the following answer to the honourable senator’s question:

The total staff employed in the Commonwealth Employment Service as at 31 December 1976 was 2704, and the great majority of these can be involved to varying degrees in any month in the recording ofthe statistics which are used as a basis for the Minister’s Monthly Review of the Employment Situation. No records are kept of the precise times spent on the collection and dissemination of the official employment statistics and no separate workload allowance is made for this function. However, an allowance of approximately 750 man weeks per month is allocated as the average time spent in the CES on the collection, collation and transmission of ail regular statistical returns to regional offices and central office.

Prawning: Gulf of Carpentaria (Question No. 451)

Senator Keeffe:

asked the Minister representing the Minister for Primary Industry, upon notice, on 19 April 1977:

  1. 1 ) Has the Minister’s attention been drawn to allegations made by the Queensland Commercial Fishermen’s State Council that prawn fishermen in the Gulf of Carpentaria are illegally loading prawns onto a Japanese vessel at night. If so. are these allegations accurate.
  2. If the answer to ( 1 ) is in the affirmative, will the Minister indicate how such illegal actions are possible.
  3. What is the Commonwealth Government to do to rectify this situation.
Senator Cotton:
LP

– The Minister for Primary Industry has provided the following reply to the honourable senator’s questions:

  1. Yes.
  2. and (3) The allegations are incorrect. The position is that the Commonwealth Government approved the temporary importation of two Japanese freighters to transport prawns from specified ports in the Gulf of Carpentaria to processing plants or ports of final export. Permission was given for one freighter to transport the prawns to Adelaide. This approval was given as a result of a recommendation by officials from government fisheries authorities, the Australian Fishing Industry Council and fishermen. These freighters which are subject to periodic inspection by officers of my department, provide a valuable service to fishermen by transporting their catch to processing plants.

Aboriginals: Social Security Cheques (Question No. 691)

Senator Georges:
QUEENSLAND

asked the Minister for Social Security, upon notice, on 27 April 1977:

  1. 1 ) Is the Minister aware that social security cheques being forwarded to Aboriginal settlement missions in Queensland are being opened by community officers and deductions are being made from the cheques for rental and electricity costs and that the balance is then handed on to the Aboriginal addressee.
  2. Has the Minister given permission for this action to be taken. If not, if such action is taken, is it in accordance with the provisions of the Act.
Senator Guilfoyle:
LP

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

  1. 1 ) and (2) The Social Services Act provides that a pension, benefit or allowance under the Act shall be absolutely inalienable. If the honourable senator is able to provide me with specific information relating to the substance of his question I will certainly have the matter investigated.

Cite as: Australia, Senate, Debates, 4 May 1977, viewed 22 October 2017, <http://historichansard.net/senate/1977/19770504_senate_30_s73/>.

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