House of Representatives
20 October 1949

18th Parliament · 2nd Session

  1. House of Representatives
  2. 18th Parliament
  3. 1949

Mr. Deputy Speaker (Mr. J. J. Clark) took the chair at 2.30 p.m., and read ‘ prayers.

page 1738

QUESTION

BROADCASTING

Mrs BLACKBURN:
BOURKE, VICTORIA

– In the absence of the Minister representing the PostmasterGeneral, I address my question to the Prime Minister. Will the right honorable gentleman confer with the Postmaster-General with a view to preventing a repetition of the infringement of section 89 (2.) of the Australian Broadcasting Act that occurred during a recent Victorian by-election. The date of the infringement was the 15th July. Is the right honorable gentleman aware that, following the infringement of the set to which I have referred, the Australian Broadcasting Control Board, which has not denied that an infringement occurred, decided to take no action against the radio station concerned ? Will bc make representations to the PostmasterGeneral and to the board in order to ensure that the provisions of the act will be observed during the forthcoming general election?

Mr CHIFLEY:
Prime Minister · MACQUARIE, NEW SOUTH WALES · ALP

– I know something of the matter to which the honorable member for Bourke has referred, but I am not familiar with the details of it. I shall ask the Postmaster-General to examine it. I shall supply the honorable member as soon as possible with the information for which she has asked.

page 1738

QUESTION

PETROL

Mr BEALE:
PARRAMATTA, NEW SOUTH WALES

– My question relates to the importation of additional sterling petrol to relieve the present petrol’ shortage in Australia. Can the Prime Minister say whether 4,500,000 gallons of sterling petrol for Australia is now being loaded in France, having been located there and purchased by Ampol? Is it a fact that another cargo of 4,500,000 gallons of sterling petrol has been bought by that, company and that tankers are now on the way to France to load it? Has the same company obtained options over two more available cargoes of petrol? Is not the finding and importing of that additional petrol duc to the energy and initiative of private enterprise and has not the Government’s only contribution been to issue the permits to import the petrol ?

Mr CHIFLEY:
ALP

– The position, as I understand it, is that Ampol applied to the Department of Trade, and .Customs for a licence to import 12,500 tons of petrol.

Mr Fadden:

– The figure was 15,000 tons. .

Mr DEPUTY SPEAKER:

– Order 1 I ask the Leader of the Australian Country party to show some courtesy to the Prime Minister when he is replying to a question.

Mr CHIFLEY:

– Ampol sought a licence to permit 12,500 tons of petrol to be imported from Le Havre, in France. The conditions under which such an import licence is granted is that the cost of the petrol and freight charges must be paid in sterling. The Minister for Shipping and Fuel has informed. me that he understands that the oil has not yet been loaded at Le Havre. The only other information that I have on the matter is that the company has conveyed an intimation to the Minister for Trade and Customs and to myself that there is a possibility of obtaining further shipments of refined petrol from France. I do not know that I can add anything to what I have stated on other ‘Occasions about the position. Attempts have been made by other companies to. obtain increased quantities df refined petrol. I am not able to say whether licences to export petrol will be granted by the French Government.

Mr Francis:

– France is without a government at the present time.

Mr CHIFLEY:

– I presume that France will have a government sooner or later and that there must be an authority that administers the granting of licences to export petrol.

Honorable members interjecting,

Mr DEPUTY SPEAKER:

– Order I The Prime Minister must be allowed to answer the question without interruption.

Mr CHIFLEY:

– Perhaps I should explain that the Attorney-General was under the impression that the honorable member for Moreton was referring to the Victorian Government, -but I assure the right honorable gentleman that the reference was to the French Government. I am not able to supply any additional information to the honorable member for Parramatta about the position. Ampol has intimated that it -is of opinion that the importation of petrol from France may not be economical at the present selling price of liquid fuel in Australia. Of course, the retail price of petrol in this country is fixed, not by the Commonwealth, but by the State Prices Ministers.

Mr FADDEN:

– I ask the Prime Minister whether in view of the acute petrol crisis that has developed throughout Australia he will say whether he is prepared to follow the example of the Premier of New South “Wales, Mr. McGirr, and order a reduction by half of the quantity of petrol being used by Commonwealth departments?

Honorable members interjecting,

Mr DEPUTY SPEAKER:

– Order ! I ask honorable members to display courtesy and good manners during question time. As Deputy Speaker I receive numerous complaints from people who listen to the broadcasting of parliamentary proceedings, about interruptions during question time, and I therefore ask honorable members to display good manners. I shall be forced to “name all honorable members who persist in interrupting during question time.

Mr CHIFLEY:

– I think I mentioned in the House recently that I had personally taken up this matter with Ministers both by letter and in .personal conversations, and had asked them to assist in the conservation of petrol by reducing consumption in government departments, so far as that action cou’ld be taken without seriously interrupting services. That has been carried out. In addition, I also mentioned that I had asked the Public Service Board to set aside an inspector in each State to examine not only the use of petrol, but also the use of official cars, in order to ascertain whether either petrol or cars were being used for unessential purposes. When lists come to me from the departments I check the mileage figures myself, and if there is any figure that requires analysis I immediately ask the Minister concerned to investigate it. There has been a great deal of talk about the unecessary use of petrol. For instance, I have had complaints about the recent Liberal party conference at Gosford, in New South Wales in relation to which quite an amount of petrol was used. Sometimes requests come to me from political parties regarding petrol for use in connexion with political matters. I think that the Leader of the Opposition will agree that both the Minister for Shipping and Fuel and myself have been strictly fair in dealing with such requests. There are occasions when there is full justification for providing petrol for activities that many people may regard as unessential. I am trying to be very f air to members of the Opposition in regard to the use of petrol to enable them to make contact with their constituents, and I propose, as I have indicated previously, to continue to make inquiries of the kind that have been made by me personally, by the Minister for Shipping and Fuel and by the Public Service Board, which is charged with the responsibility of checking the use of government cars.

page 1739

QUESTION

CIVIL AVIATION

Mr SHEEHAN:
COOK, NEW SOUTH WALES

– Will the Minister for Civil Aviation give to the House the details of the total number of passengers carried on all the services operated by Australian National Airways Proprietary Limited and Trans-Australia Airlines respectively for the years ended the 30th June, 1948, and the 30th June, 1949? Will he also give the respective percentage loading of passengers carried during the same period? What is the number of regular services that are operated by Australian National Airways Proprietary Limited and Trans-Australia Airlines respectively solely .between Canberra and Sydney? Will the Minister also give the passenger load factors for shuttle services between Sydney and Canberra?

Mr DRAKEFORD:
Minister for Air · MARIBYRNONG, VICTORIA · ALP

– Australian National Airways Proprietary Limited carried 584,140 passengers during th, year ended the 30th June, 1948, and 612,083 during the year ended the 30th June, 1949, an increase of 27,943 in a period of twelve months. Trans-Australia Airlines transported 343,811 passengers in the year ended the 30th June, 1948, and 454,759 during the year ended the 30th June, 1949, an increase of 110,948.

The passenger lond factors were as follows : -

It will be thus seen that Australian National Airways Proprietary Limited suffered a. reduction of 2.4 per cent., while Trans-Australia Airlines had an increase of 5.4 per cent. Particulars for the services operating between Sydney and Canberra are as follows: -

Mr WHITE:
BALACLAVA, VICTORIA

– I ask the Minister for Civil Aviation whether the Postal Department paid a subsidy of £345,000 to TransAustralia Airlines in 194S-49. If so, will the Minister tell the House what the relative subsidy would have been at the rates paid previously to private enterprise? What gallonage of petrol was used by Trans-Australia Airlines during the year 1948-49? The Minister has produced a lot of statistics, and I hope that he will also be able to give us those for which I am asking. What price is paid for petrol by Trans- Australia Airlines? Does it enjoy a rebate of duty and obtain petrol from bond ? If so, what is the value of that concession?

Mr DRAKEFORD:

– I cannot be expected to give offhand the details of the gallonage of petrol used by TransAustralia Airlines, but I can say that there are no special provisions for it to get petrol at a lower price than that which any other airways company pays. Trans-

Australia Airways is operated on a commercial basis. The term “mail payments “ is preferable to the term “ subsidy “, but, whichever term one uses, the figure stated by the honorable member is not correct. Acceptance of mail payments obliges Trans-Australia Airlines to carry all mails offering.

Mr White:

– What was the figure?

Mr DRAKEFORD:

– It was £325,000 for 194S-49. The amount is determined from year to year. During the railway strike in Victoria some time ago and the recent floods and coal strike in New South Wales, Trans-Australia Airlines carried everything, including, as I have said previously, Hansards containing speeches made by the honorable member himself.

page 1740

QUESTION

ENTERTAINMENTS TAX

Mr FRANCIS:

– Can the Treasurer say what relief was granted in the recent budget in regard to taxation on admission charges to sporting fixtures, such as cricket, football and boxing,- in accordance with the Government’s decision to reduce the amount of tax paid by the public ? If no relief has been given, will the Treasurer consider introducing legislation to provide for handing over the proceeds of the tax to the controlling bodies of the sports mentioned to be invested by trustees, and used to compensate persons injured in the sports?

Mr CHIFLEY:
ALP

– The only person able to give detailed information on the point raised by the honorable member is the Commissioner of Taxation, who operates under an ‘act, which leaves administrative matters entirely to him. The affairs of individuals or organizations arc confidential when they come into his possession. I shall ask the Commissioner of Taxation to see what information may be passed on to the honorable member without .committing a breach of confidence. As for the second part of the honorable member’s question, I assure him that I do not intend to introduce any legislation of the kind he suggested.

page 1740

QUESTION

CAPITAL ISSUES ADVISORY COMMITTEE

Mr LANG:
REID, NEW SOUTH WALES

– Has the attention of the Treasurer been directed to evidence given by Thomas Richard Pracey, former

Mayor of Waterloo, in the Bankruptcy Court, that he had been given permission by the Capital Issues Advisory Committee at Canberra to borrow £20,000? Will the Treasurer institute inquiries to ascertain on what grounds the Capital Issues Advisory Committee sanctioned the loan, what security was offered, and what was the stated purpose of the loan? Will he ascertain whether the committee was aware that portion of the money was to be invested in the purchase of race-horses and trotters? Were any representations made to the committee on Pracey’s behalf by any Federal or State member of Parliament? Will the Treasurer obtain all the papers and lay them on the table of the House?

Mr CHIFLEY:
ALP

– Information supplied to the Capital Issues Advisory Committee by companies or individuals about their assets does not come under my observation, and I do not intend to inquire into the affairs of individuals or companies. I do not know what information could be supplied to the honorable member without committing a breach of confidence, and I certainly do not intend to lay on the table of the House files containing information supplied in confidence to government departments. However, I shall make inquiries from the Capital Issues Advisory Committee in order to find out what information can bc supplied regarding the points mentioned by the honorable member. I have heard something about the person mentioned by the honorable member. I did not take much notice of the question about race-horses, because there are persons who regard racing as an industry, as . the honorable member for Reid should be we’ll aware from his own experience in New South Wales.

page 1741

QUESTION

HIGH COURT

Mr BEAZLEY:
FREMANTLE, WESTERN AUSTRALIA

– A statement published in the Sydney Morning Herald to-day and attributed to the honorable member for Warringah contains, amongst several hundred words, the suggestion that Cabinet intends to appoint to the High Court persons who will be subservient to the Government. I ask the Attorney-General whether the Cabinet, or a sub-committee of the Cabinet, has recently discussed appoint ments to the High Court or an amendment of the law governing the number of members of the High Court Bench. Secondly, I ask the right honorable gentleman whether the statement attributed to the honorable member for Warringah is essentially the same as one that he made at Palm Beach two years ago. Thirdly, I ask whether the statement has any more basis of fact now than it had then.

Dr EVATT:
Attorney-General · BARTON, NEW SOUTH WALES · ALP

– I was asked a question on this subject a week or ten days ago after a statement had been made by the honorable member for Warringah at, I understand, a public meeting in his own electorate in which he asserted that it was the intention and the plan of the Government to pack or stack the High Court of Australia, the supreme tribunal of this country. On the same day, or the next day, I was asked in the House about the correctness of that statement and my colleague. Senator McKenna, who was Acting Attorney-General during last year and this year, was asked the same question in the- Senate, and we gave an answer that still holds good, which was, that the statement is completely untrue; that the Cabinet has never considered the matter since 194’6; that, in 1946, we made the only appointment to the court made by the Government in a period of eight years; and that we then appointed the Chief Justice of Queensland, Sir William Webb, to be a justice of the High Court of Australia. I have not heard and I do not hear at any stage any objection to the correctness and propriety of that appointment. I have read the statement of the honorable member for Warringah in the press. There was some little truth in it in the sense that he quoted something that other persons had said; and there were some half-truths in it, but the bulk of it consisted of untruths, and the’ general sense of it was completely untrue. The Prime Minister has already dealt with this matter on a previous occasion, and I want to make it perfectly clear that, despite ‘ criticisms of the court - and I am not saying anything that should be construed as meaning that anybody, least of all the members of this Parliament, should be deprived of the liberty to criticize the judgment of the court - such a proposal as the honorable member has mentioned has never been considered by the Government. No such suggestion is in the Government’s mind, and the statement of the honorable member to the opposite effect is completely withoutbasis. Yet he repeated that statement after it had been contradicted. I ask honorable members to examine the facts regarding the honorable member for Warringah’s assertion. Those facts will bear out that, as I have said, not one of the judicial appointments made by this Government has been subjected to criticism by members of the Opposition. I submit that those appointments have been beyond question. The suggestion that Cabinet either would, or could, get members of the bar to become subservient tools of the Government is disgraceful, but the honorable member has repeated it and has joined with it the assertion that the Government intends also to abolish the system of appeal to the Privy Council. That system is preserved by the Constitution of Australia, although, of course, it could be altered by the Parliament. In fact, the Government has been criticized by members of the Opposition because it recently exercised the right of appeal to the Privy Council. No suggestion to abolish the system of appeal to the Privy Council has ever been considered by the Government, despite the repeated assertions of the honorable member for Warringah. I repeat, therefore, that his suggestion is, in the first place, an untruth, and that, as he has persisted in it after contradictions of it by the Prime Minister, the Acting Attorney-General, and myself, it is a deliberate untruth.

Mr Spender:

– I desire to make a personal explanation.

Mr DEPUTY SPEAKER:

– The honorable member may not make a personal explanation during question time.

page 1742

QUESTION

PUBLIC WORKS

Snowy Mountains Scheme - River

Murray Waters Commission

Mr FULLER:
HUME, NEW SOUTH WALES

– Has the Minister for Works and Housing seen the statement by the Leader of the Opposition that if he were returned to power he would abolish the Snowy Mountains Hydro-Electric Authority and substitute for it an authority set up under Commonwealth and State control? Can the Minister inform me whether the setting up of an authority representative of three governments would cause delay in the completion of this national project?

Mr LEMMON:
Minister for Works and Housing · FORREST, WESTERN AUSTRALIA · ALP

– I did see a statement by the Leader of the Opposition which was somewhat along the lines of that mentioned by the honorable member. Experience in this and other countries has proved that if a joint authority were established to carry out a work of the magnitude of the Snowy Mountains scheme the ultimate completion of the project would be considerably delayed. That statement is borne out by the experience of the Tennessee Valley Authority. Some years after the Tennessee Valley project had been commenced a congressional committee was appointed to inquire into the reasons for the delay in the completion of the work. The committee reported that the divided control resulting from the appointment of three commissioners, each having equal powers to authorize construction, caused the major delay in the completion of the scheme. Nearer home, we have also the experience of the River Murray Waters Commission to guide us. Although a tentative agreement was reached in 1886 to proceed with the River Murray waters scheme, the enabling bills were not brought before the Parliaments until 1914. In the interval the Commonwealth Parliament had been established. In 1914 an agreement was entered into between the Commonwealth and the Governments of New South Wales, Victoria, and South Australia, but work on the project was not commenced until 1918. That was a small project compared with the Snowy Mountains scheme, but progress was so slow that in 1928, nine years after work had commenced, a committee was established to inquire into the reasons for the delay. The committee reported that the principal delay resulted from the division of authority between the three States and the Commonwealth. Later, an attempt was made to reach agreement between the three States and the Commonwealth to raise the level of the Hume weir, and four years elapsed before the agreement was signed by all parties. If the proposal of the Leader of the Opposition were put into effect I very much doubt whether any honorable member in this House would be alive to see any substantial progress on the Snowy Mountains scheme.

page 1743

QUESTION

PASSPORTS

Mr RYAN:
FLINDERS, VICTORIA

– Can the Minister for Immigration explain why an Australian who holds an Australian passport cannot obtain a vise to enter Spain, whereas the holder of a British passport can do so, apparently without difficulty? My question is prompted by the case of Mr. S. Morell, a Melbourne business man, who has extensive interests in Spain, but who is unable to enter that country. Mr. Morell is the son of the late Sir Stephen Morell, who was Consul-General for Spain for many years.

Mr CALWELL:
Minister for Immigration · MELBOURNE, VICTORIA · ALP

– The honorable member for Swan raised this matter recently in a question which related to the alleged treatment in France of the Australian singer John Brownlee. I have supplied the honorable gentleman with a detailed explanation of the whole situation.

Mr Hamilton:

– Was that done by letter ?

Mr CALWELL:

– I have given a copy of the reply to the question to the Clerk of the House. Our attitude to the issue of vises is dictated by a concern for the security of this nation, and by that alone. We could do what Great Britain has done in respect of Spain, France, Switzerland and other countries.

Mr White:

– Why not?

Mr CALWELL:

– If the honorable member for Balaclava will be patient and remain silent, I shall tell him why not. We could allow Frenchmen, Spaniards and other foreigners to enter this country without vises, but if we did so the very first persons to criticize us for not adopting a proper system of security screening of persons entering this country would be certain honorable gentlemen opposite, who have repeatedly raised this matter. The honorable member for Parramatta was the first to raise it, because he had encountered some difficulties. Nobody need meet with difficulties if He will take the necessary but easy preliminary step of approaching a consular or diplomatic representative of the country to which he desires to travel and asking for a vise.

Mr Ryan:

– That has been done in this instance.

Mr CALWELL:

– I do not know whether it has been done. If it has, the fault lies with the Spanish authorities and not with the Australian authorities. The fault cannot be that of the Australian authorities. If the Australian Government has raised no objection to the issue of the passport and if the Spanish authorities have issued a vis6. obviously the fault lies with the Spanish authorities if an Australian citizen is not permitted to land in Spain. I do not intend to cast any reflection upon Mr. Morell. I have not the pleasure of knowing him, but for many years I served on the Melbourne City Council with his father, an Australian citizen, a former Lord Mayor of Melbourne and a Consul-General for Spain. The honorable member for Flinders will find that the trouble lies, not with any Australian authority but rather with some Spanish authority. While this Government remains in office, which it is certain to do for many years to come, we shall not depart from a system that ensures the protection of the security of this nation. That should be the first consideration of all Australian citizens. That is far more important than is th, convenience of globe-trotting persons who are concerned only with their own pleasure.

page 1743

QUESTION

WHEAT

Mr DUTHIE:
WILMOT, TASMANIA

– In view of reports that have appeared in the Tasmanian press this week, will the Minister for Commerce and Agriculture state the position regarding the payment of freight upon wheat sent by the Australian Wheat Board” from the mainland of Australia to Tasmania?

Mr POLLARD:
Minister for Commerce and Agriculture · BALLAARAT, VICTORIA · ALP

– I have seen statements in the Tasmanian press that purport to convey the apprehensions of the people of Tasmania in connexion with a recent decision of the Australian Wheat Board about the payment of freight charges upon wheat sent from the Australian mainland to Tasmanian ports. The decision of the board is that freight charges in respect of such wheat must be borne by Tasmanian purchasers. As honorable members know, the existing wheat plan is the result of a decision that was made by the Commonwealth Cabinet in 194S. It was decided then that the Commonwealth would guarantee to the Australian wheat-growers a return of 6s. 3d. a ‘bushel for their wheat for a period of five years, that figure being subject to variation in accordance with fluctuations of the cost of production. At the present time the guaranteed price is 6s. 8d. a bushel. The Commonwealth has undertaken to ensure that the guaranteed price shall be paid each year in respect of 100,000,000 bushels of wheat for export plus the home-consumption requirements of the Australian people. Prior to the operation of the present plan, the freight charges in respect of wheat sent to Tasmania were defrayed in several ways. At one period they were the subject of a subsidy from the Australian Government. At that period the price of wheat in the markets of the world was so low that the Australian Government paid a subsidy to Australian wheat-growers in order to assist them. At a later period, when the price of wheat was at a higher level, freight charges in respect of wheat sent to Tasmania were defrayed from the flour tax. From December, 1948, until the present time, the transport charges upon wheat sent to Tasmania and made available to the Tasmanian people at the found cost of production have been borne by the Australian wheat-growers. The Australian Wheat Board now considers that it will be desirable to charge the cost of transporting wheat from the mainland to Tasmania against the Tasmanian consumers. I have made a close examination of the legislation that governs the wheat stabilization plan. Under the Commonwealth legislation, the guaranteed price of wheat is 6s. 3d. a bushel,” that figure being subject to variation in accordance with fluctuations of the cost of production and is now 6s. 8d. a bushel. With regard to State legislation, the price prescribed by each of the six States of Australia is 6s. 3d. a bushel, that figure again being subject to variation if the cost of production fluctuates. If the requirements of the Tasmanian legislation are to be complied with and if Tasmania is to receive the benefits of the plan, the Australian Wheat Board must make wheat available for sale in Tasmania to Tasmanian producers at the guaranteed price, which at the moment is 6s. 8d. a bushel. It is a very involved position. Under the terms of the Commonwealth legislation, the Minister for Commerce .and Agriculture is empowered to direct the Australian Wheat Board to. do certain acts. That power has been subjected to adverse criticism, but it has always been exercised with discretion. As a responsible Commonwealth Minister, I have always been reluctant to direct any authority to do anything. I still have that feeling of reluctance. Yesterday, I despatched a letter to the Australian Wheat Board-

Opposition members interjecting,

Mr DEPUTY SPEAKER:

– Order ! The honorable member for Fawkner (Mr. Holt) is trying to interrupt the proceedings of the House.

Mr Holt:

– I did not open ray mouth.

Mr POLLARD:

– I was about to say that, as the result of my reluctance to exercise that power, I despatched to the Australian Wheat Board yesterday a letter in which I suggested that it might see fit to defer its decision to charge freight against the consumers in Tasmania pending the clarification of the legal requirements of the Wheat Industry Stabilization Act passed by the Commonwealth Parliament and the complementary legislation passed by the six State parliaments. I am hopeful that the Australian Wheat Board will see the wisdom of my request. The plain fact is that, if the present situation is allowed to continue, consumers of bread in Tasmania will suffer an increase of price of approximately Id. a loaf, and pig producers, dairymen and others who use wheat for stock feed in Tasmania will have to meet substantially increased costs. ‘ If the Australian Wheat Board, in its wisdom, sees fit to accede to my request, the net loss for the time being in respect of the overall position of the board will be less than one farthing a bushel.

page 1744

QUESTION

TIN

Mr BLAIN:
NORTHERN TERRITORY

– I address to the Prime Minister a question which relates to the price of tin. I have received the following telegram from the secretary of the Lessees Association at Maranboy: -

Have wired Prices Commissioner Canberra re Australian price of tin. Will you please endeavour speed up rise of Australian price in view of big overseas rise?

Will the right honorable gentleman inform me whether the Australian price for tin has been pegged at a higher figure in sympathy with the increased overseas price for that base metal following the devaluation of the currency?

Mr CHIFLEY:
ALP

– As the honorable member for the Northern Territory knows, the prices of various base metals cannot be determined at present by the Australian Government. I understand that Australian prices follow, to some degree, the overseas prices for base metals. A movement certainly occurred in the prices of lead and zinc. I understand that consideration has been given to the price of tin, but I shall arrange for the Minister in charge of prices control in the Commonwealth sphere to prepare a statement on the subject, and I shall supply it to the honorable gentleman.

page 1745

REPORTS OF PUBLIC WORKS COMMITTEE

Mr RANKIN:
BENDIGO, VICTORIA

– I present the reports of the Public Works Committee on the following subjects : -

Proposed erection of the National Library and Roosevelt Memorial, Canberra, Australian Capital Territory.

Proposed erection of a Commonwealth office building, Hobart, Tasmania.

Ordered to be printed.

page 1745

QUESTION

PREFERENCE TO EX-SERVICEMEN

Mr GULLETT:
HENTY, VICTORIA

– I ask the Minister for Repatriation or the Minister for Post-war Reconstruction a question concerning the application of those sections of the Re-establishment and Employment Act which are calculated to ensure preference in employment for those exservicemen who are entitled to receive it. What was the total number of applications received for the position of supervisor of hostels in Melbourne in the Migrant Workers’ Accommodation Division of the Department of Labour and National

Service? How many applications were received from permanent officers and nonpermanent officers who are returned soldiers? Is it a fact that the applicants for the position were not interviewed? If interviews were given, will the Minister informme how many permanent officers and non-returned soldiers were interviewed? Is it a fact that, finally, Mr. M. S. Dunne, a non-permanent officer and a non-returned soldier was appointed to the position? Is Mr. Dunne the endorsed Labour candidate for the Balaclava seat in the forthcoming general election ?

Mr CALWELL:
ALP

– I shall answer the question. I shall have inquiries made and supply answers to all the questions which the honorable member has asked. It is news to me that Mr. M. S. Dunne is the endorsed Labour candidate for Balaclava. At the moment, I cannot recollect who the endorsed Labour candidate for that seat is. However, I should like the honorable gentleman to know that about 90 per cent, of the staff of the Department of Immigration are returned soldiers.

page 1745

QUESTION

RECALL OF AUSTRALIAN CITIZENS FROM OVERSEAS

Dame ENID LYONS:
DARWIN, TASMANIA

– Is the Minister for Immigration yet in a position to answer the question that has been standing in my name in one form or another on the notice-paper since last October? If he is not able to furnish a reply, will he say whether he has finally abandoned interest in the Manila girls, or, alternatively, will he give an assurance that in future the young women shall be left to conduct their own affairs without ministerial interference?

Question not answered.

page 1745

MR. P. C. SPENDER, M.P

Mr SPENDER:

– I desire to make a personal explanation.

Mr DEPUTY SPEAKER:

– Order ! Does the honorable member claim that he has been misrepresented?

Mr SPENDER:

– Yes, I do. The Minister for External Affairs to-day, and also last week while I was absent from this chamber, said, in reply to questions which had been directed to him by other honorable members, that certain statements that I had made in which I expressed my opinion that this Government, if returned to office, would stop at nothing to achieve its objective of socialization, were untrue and were simple downright untruths.

Mr DEPUTY SPEAKER:

– Order ! The honorable member is proceeding to debate the point.

Mr SPENDER:

– No, I am not.

Mr DEPUTY SPEAKER:

– Order ! The honorable member is entitled to make a personal explanation only if he has been misrepresented, but so far he appears to be trying to argue a point that was madeby the Minister for External Affairs. That is a matter for a statement, and not a matter for a personal explanation.

Mr SPENDER:

– I am seeking to make a personal explanation.

Mr DEPUTY SPEAKER:

– Order ! So far, the honorable member has not indicated wherein he has been misrepresented.

Mr SPENDER:

– The Minister for External Affairs conveyed in his reply to-day, and on the previous occasion when I heard from my sick bed the broadcast of his remarks, that, for party political purposes, I had expressed a view that I did not hold. I have been wholly misrepresented in respect of that matter, because the view that I expressed is the view that I firmly hold and I should like, with your leave, sir, to state a few facts upon which that view is based.

Government members. - No.

Mr DEPUTYSPEAKER:

– Order ! The honorable gentleman knows that in making a personal explanation he is not entitled to introduce any new matter. He may only show how he has been misrepresented. He is not entitled to enter into a discussion of the matter.

Mr SPENDER:

– I bow to your ruling, sir, and content myself with saying that the Minister for External Affairs is quite wrong in conveying to the public, as he has done on two occasions, that I advanced a view simply for party political purposes. I firmly hold that view, and nothing that the Minister has said will persuade me that it is wrong.

page 1746

QUESTION

FREEDOM OF SPEECH

Mr ARCHIE CAMERON:
Postmaster-General · BARKER, SOUTH AUSTRALIA · ALP

– Will the Minister for External Affairs prepare a list of statesmen and leading men in world politics who advocate freedom of speech, and then vote to prevent one of their political opponents from exercising that right ?

Question not answered.

page 1746

QUESTION

DEFENCE

Hong Kong

Sir EARLE PAGE:
COWPER, NEW SOUTH WALES

– Can the Minis ter for External Affairs say whether the press report is correct that concerted action is being taken by the United Kingdom and the United States of America for the defence of Hong Kong? If so, what part is Australia playing in the arrangements? Will the Minister, before the House rises, make a full statement about the position in South-East Asia?

Dr EVATT:
ALP

– I cannot undertake to cover all the ground referred to by the honorable member in his question, but I can say that concerted action is being taiken regarding the situation in China, the coming into existence of a new government in the north of China, and the relations of that government with the surrounding territories, including, of course, Hong Kong, a very important area from our point of view. These matters are being discussed by the governments of the United Kingdom, the United States of America, and Australia.

page 1746

CURRENCY

International Monetary Fund

Mr. CHIFLEY (Macquarie - Prime

Minister and Treasurer). - by leave - When Marshall aid began in 1948, the gold and dollar reserves of the United Kingdom, which are also the central reserves of the sterling area as a whole, were 2,000,000,000 dollars. It was the declared objective of the United Kingdom Government to maintain reserves at about that level throughout the Marshall aid period. However, during the June quarter of this year, there was a sharp increase in the sterling area dollar deficit. By the 30th June, the reserves had fallen to about 1,650,000,000 dollars.

It was this development which led to the calling of the conference of British Commonwealth finance ministers in [London in July. This conference discussed ihe longer-term measures, which would be needed to correct the balance in trade and payments between the sterling area and the dollar area. The delegates of all countries represented recognized, however, that in the short-term the only :means of checking the drain on reserves was to cut sterling area dollar expenditure to a level which could be financed from the dollar receipts currently available. The statistical survey made at the conference indicated that in 1949-50 the dollars currently available for the purchase of imports would not be sufficient to ‘buy more than 75 per cent, by value of the goods bought from the dollar area in the calendar year 1948. The United Kingdom Government announced its decision to cut dollar imports into the United Kingdom in 1949-50 to 75 per cent, of the 1948 level, and the representatives of other sterling area countries agreed to recommend to their respective governments that action be taken to achieve comparable results.

When introducing the budget on the 7 th September, I informed honorable members that, in view of the extreme gravity of the position, the Government had accepted that recommendation. It was also accepted bv all the other sterling countries of the British Commonwealth. However, as I also explained in the budget speech, a full 25 per cent, saving in expenditure on dollar imports into Australia will not be possible of achievement in 1949-50 because of the commitment represented by outstanding licences. To have attempted to achieve so steep a reduction during the remaining months of the current financial year would have involved severe disruption to Australian industries. Given a somewhat longer period in which to make the necessary adjustments, however, it is considered that it will be practicable to reduce the rate of expenditure on dollar imports to 75 per cent.’ of the 1948 level without serious damage to our economy, particularly as a result of the increasing availability of supplies from the United Kingdom and other non-dollar sources.

Other British Commonwealth countries are, of course, confronted with somewhat similar difficulties, and it was agreed that any country which wished to do so could seek a dollar loan as an alternative to applying the full cut of 25 per cent, in dollar import expenditure in 1949-50. Accordingly, the Government decided to explore the possibility of obtaining additional dollars from some source which would reduce our call on the gold and dollar resources of the United Kingdom. Various possibilities were considered, but the Government finally decided that, in all the circumstances, the most appropriate course would be to purchase from the International Monetary Fund the dollars required to meet a proportion of our current commitments. The fund has agreed to an initial drawing by Australia of 20,000,000 dollars, which will be made available immediately to meet commitments falling due. The precise amount of additional dollar finance, which will be needed during the current financial year, will depend on the results which are actually achieved in limiting expenditure on dollar imports during the remaining months of the year. The position will be kept under close review by the Government and the question of further drawings will be considered as necessary.

I emphasize that the purchase of dollars from the fund will do no more than enable us to meet commitments arising from the present restricted dollar import programme. Although it is proper to employ the dollars drawn from the fund to provide temporary assistance while we are adjusting ourselves to greater dollar economies, we cannot regard them as permitting the purchase of additional dollar goods beyond those already provided for in our present programme.

A drawing from the fund is not a loan in the ordinary sense of the term. In accordance with the articles of the agreement in relation to the fund the 20,000,000 dollars will be purchased by Australia from the fund against the payment to the fund of the equivalent in Australian currency calculated at the new par rate of 2.24 dollars to the £1 Australian. The effect will be to increase the fund’s holdings of Australian currency with the Commonwealth

Bank in Sydney by approximately £A.8,929,000.

There are, of course, certain charges to be met. in connexion with this transaction as provided for in the agreement. In the first place, there is a relatively small service charge, calculated at threequarters of 1 per cent, of the amount of the drawing, which is payable in gold. Arrangements have already been made for the payment of this service charge, which, in the case of the present drawing, amounts to the equivalent of 150,000 dollars, or about £A. 67,000. For the first three months after the date of the drawing, no further charges are payable.

The charges payable after three months are calculated as a percentage of the amount by which the fund’s holdings of Australian currency exceed Australia’s total quota in the fund. The quota fixed for Australia under the agreement is 200,000,000 dollars, or approximately £A.89,2S 6,000. Against this the total holdings by the fund of Australian currency have been increased by the present transaction to approximately £A.94,45S,000. The excess above our quota is, therefore, approximately £A.5,172,000, and it is on this amount that the percentage charges will be calculated. For the first nine months after a charge becomes payable, the rate will be one-half of 1 per cent, per annum. For the following twelve months the rate of the charge will rise to 1 per cent, per annum. Thereafter the rate will be increased each year by a further one-half of 1 per cent, per annum, until it reaches 4 per cent, at the end of seven years. If by that time the amount is still outstanding consultation with the fund on the measures to be adopted to reduce the fund’s holdings of Australian currency will be necessary. Since the London conference was held, talks have taken place in Washington between representatives of the American, Canadian and United Kingdom Governments. There has also been a widespread readjustment of exchange rates. The short-term problem, however, remains.

The generally satisfactory outcome of the Washington talks and the devaluation against the dollar does not in any way relieve the sterling countries of the British Commonwealth from the necessity of putting into effect the dollar economy measures contemplated at the London conference. The new exchange rate does provide increased opportunities for marketing sterling area goods in the dollar countries and, as time goes on, an overall increase in the sterling area’s dollar receipts is hoped for. Increased dollar earnings cannot, however, be expected immediately. Our responsibilities are clear. We must, in the interests of Australia and of the whole sterling area, carry out the recommendations of the London conference and continue to work together with our partners in the British Commonwealth towards getting trade and payments between the sterling and dollar areas into better balance.

Mr FADDEN:
Leader of the Australian Country party · Darling Downs

– by leave - The Prime Minister (Mr. Chifley) has made a most important statement. The belated decision of the Government must be linked with the dire need for equipment if Australia’s productivity is to develop as it should do. I advocated an application to the International Monetary Fund as far back as the 29th March last when the value of the Australian £1 in relation to the dollar was much greater and when conditions were much more favorable than is now the case.

Some months ago, primary producers’ organizations conducted an expert survey of the requirements of their members. The results revealed appalling shortages of agricultural implements such as tractors, harvesters, combines, ploughs and trucks. There were also serious shortages of fencing wire, steel posts, galvanized iron, piping, barbed wire, bore casing and, in fact, almost every essential item urgently required to step up production in Australia.

Mr DEPUTY SPEAKER:

– Order ! I think the right honorable member obtained leave to make a statement on a specific matter.

Mr FADDEN:

– I have the leave of the House to make a statement, and I am pointing out the necessity-

Mr DEPUTY SPEAKER:

– If the right honorable gentleman will listen to me, I shall clarify the position. He obtained leave to make a statement on a specific matter raised by the Prime Minister. I do not think he should take advantage of that leave to bring in other matters that have no direct relationship to the statement made by the Prime Minister.

Mr FADDEN:

– The application to the International Monetary Fund is to be made for dollars with which to buy essential equipment needed by Australia. I am endeavouring to point out how totally inadequate is the amount that has been applied for. When I raised this matter in the course of my budget speech, the Prime Minister branded the statements to which I directed attention as “ bogus “. In other words, he accused my informants of being liars. If he and his officers in the Treasury had taken only a little trouble to investigate the position they would have substantiated the scarcity of equipment that can be obtained only from dollar sources. The Prime Minister has no solution to the shortage difficulty. He claims that there is full employment in Australia. If there is no further employable pool, how can we possibly overcome present shortages from our internal resources? We must have outside help if we are to get the materials necessary to step up production in both primary and secondary industries. Here again he has no solution. It is obvious that we should have applied long ago to one of the world monetary agencies established under the United Nations organization for the necessary dollar assistance. Very little is known of the workings of these agencies, and so I propose to deal with the most appropriate, which is the International Monetary Fund. One of the main objectives of the fund is to establish a world economy in which all countries can have a chance to put their international payments in order. To assist in achieving this end, it sells foreign exchange to its members out of the currencies held by it. By April, 1949, the fund had 1,439,000,000 dollars in gold, and the equivalent of 5,526,000,000 dollars in other currencies, including 1,340,000,000 United States dollars. Currencies purchased from the fund at that date were the equivalent of 725,000.000 dollars, of which by far the greater proportion was United States dollars. The equivalent of 119,000,000 dollars was purchased in the preceding twelve months. This is the first occasion on which Australia has participated in any dollar or other currency purchased from the fund. The Prime Minister’s excuse was that the fund could not meet all the demands made on it for dollars ! This is the usual specious humbug to which we are becoming accustomed. Sales of currency from the fund are subject to conditions, one of which is that a member may not, in general, purchase more than 25 per cent, of its quota everytwelve months until purchases reach its quota. Australia’s quota is the equivalent of 200,000,000 dollars, so four yearly purchases of 50,000,000 dollars are possible. Except for this present application, no dollars have been purchased by Australia. Be-purchase of currency is expected and is required under certain conditions. These are rather complicated, and depend upon the annual increase in the member’s monetary reserves, which include both gold and convertible currencies. Australia’s obligation to repurchase any of its currency at an early date would not arise under present conditions. Its huge London funds are not in a convertible currency so they would not be taken into account. Sales of currency are subject to an initial service charge of three quarters of 1 per cent, together with a rising period charge, dependent on the amount of currency which the fund holds in excess of the country’s quota. If Australia purchased 50,000,000 dollars, or 25 per cent, of its quota immediately, which it is able to do, the charges would be as follows : - An initial three-quarters of 1 per cent.; no charge for three months; one-half of 1 per cent, per annum for the next nine months; then an increase of one-half of 1 per cent, for each subsequent year to the eighth year. In other words, if the £50,000,000 dollars remained outstanding for seven years, the charge rate would have risen by successive steps to 4 per cent., under the basic conditions that have been laid down and that I have just related.

The greater the percentage of quota purchased, the higher in proportion is the charge rate. In other words, if 50 per cent, of the quota were purchased, the 4 per cent, charge rate would be reached sooner. As soon as the 4 per cent, rate applies, the fund and the member must meet to consider how its holdings can be reduced, although the charges can subsequently rise to 5 per cent, and even higher. At the end of each financial year, members are obliged, in certain circumstances, to use part of their monetary reserves, which means their gold and convertible currencies, to re-purchase part of the fund’s holding of their currencies. The amount of monetary reserves to be used in this- way is equal to one-half of any increase which has occurred during the year in the fund’s holdings of the member’s currency, plus half of any increase, or minus half of any decrease, that has occurred during the year in the member’s monetary reserves. Re-purchases, however, are not required where the member’s monetary reserves at the end of the financial year are below its quota, or to the extent that re-purchases would reduce those reserves to an amount less than the member’s quota. This is intended to help members to preserve a minimum reserve corresponding to the amount of each member’s quota.

Australia’s quota is the equivalent of 200,000,000 dollars, its holdings of convertible currencies are negligible, and ite gold holdings are small. Consequently, it is most unlikely that we would be required, under the fund’s rules, to make re-purchases for some years. Other exceptions to the re-purchase obligations at the end of each year occur where the fund’s holdings of a member’s currency fall below 75 per cent, of its quota, or in certain other analagous circumstances. The fundamental aims of the re-purchase provisions are to protect the liquidity of the fund by restoring or establishing a desirable level of its holdings of currencies, and to ensure that its resources will be a secondary line of reserves and that members will not use the fund’s resources to build up their independent monetary reserves. Conversely they are designed to ensure that a member need not repurchase its currency until it has built up reasonably sufficient reserves.

The Treasurer has obviously not fully explored the possibility of utilizing Australia’s share of the fund’s resources under the most advantageous circumstances. He has apparently only a hazy knowledge of the fund’s workings to judge by a recent reply made by him in the House and forti- fied by the statement he has just made that he intends to apply for an amount of dollars in the circumstances set out in the statement, not so as to obtain additional equipment or other requirements, but so as to meet the restrictions on dollar spending that he ha3 agreed upon with the United Kingdom Government. In the reply to the question to which I have just referred, he said that Australia’s drawing rights were about 45,000,000 dollars annually, when in fact they are 50,000,000 dollars. He also said that interest was payable, when in fact it is a service charge, and not interest, that is payable. He went on to say that the rate of interest could reach 4 per cent., when the fact is that the service charge, and not the interest, as I have said, can reach 5 per cent, and higher, and that drawings ultimately became a debt which had to be repaid. This is not true if the fund is allowed to function more fully, and if other countries purchase Australian pounds from it. The Treasurer also said that the fund could not meet all the demands made on it for dollars, yet a few months ago the fund had only sold 725,000,000 dollars of the 1,340,000,000 dollars subscribed, it had 1,439,000,000 dollars in gold, and the equivalent of 5,526,000,000 dollars in other currencies.

  1. Camille Gutt. managing director of the fund, presenting the Third Annual Report on 28th September, 1948, said about the fund’: -

It has no other purpose than to -work with and through its members in establishing a world economy in which all countries can have a chance to place their international payments in order.

The achievement of this purpose depends largely upon the willingness of our members to work wholeheartedly with each other, through the fund. 1 emphasize this necessity because I believe the time has come when international co-operation should be a more active concept; because I believe the fund can better help its members if the work of the fund brings them into more continuous and even closer relationship with each other, and with the fund, in dealing with their exchange and payments problem.

Australia is experiencing an acute dollar shortage and would undoubtedly be entitled to purchase many millions of United States dollars from the fund at an extremely low annual charge rate. These dollars could be used to restore the equilibrium of our balance of payments especially to hard currency areas. Despite these obvious advantages Australia has not applied to the fund for assistance. In the fund’s first three years, 40 of its 48 member countries were visited by its technical experts, missions or officials. These visits, in some instances, were to gather information, but in many cases they have also assisted in the analysing of a country’s monetary and exchange difficulties, concerning which the fund made recommendations. Australia was not visited, nor has it availed itself of the fund’s assistance.

The questions of immediate importance are whether the trade pattern is to be changed mainly by increasing the exports of deficit countries, or by reducing their imports from the surplus countries; and whether the necessary shifts are to be made on the basis of relative efficiency and economy or by restrictions and discriminations. The ‘fund says that it is in the general interest that international payments should be restored by expansion of exports on the basis of relative prices and costs rather than by the contraction of imports through restrictions and discriminations. Australia has chosen the negative, restrictive course of cutting down dollar imports. This achieves a temporary immediate objective at the expense of future recovery of a more permanent nature. Greater co-operation with the fund, and a fuller use of its resources to provide the means for greater production with a corresponding future increase of exports, is a much more realistic and a far sounder policy. Use of the fund’s dollars would give Australia a greater flow of goods of dollar origin which are in acute short supply here, and which are vitally necessary, if not absolutely indispensable, before production can be appreciably increased. With the expansion of our international trade, based on greater production, Australia would, no doubt, not have to re-purchase the greater proportion of the dollars originally obtained from the fund. Other countries would be induced to purchase Australian pounds from the fund to buy our wool, wheat and other goods, and that would reduce our obligation to re-purchase some of the £1 notes with which we bought dollars from the fund. .Thus, the fund would achieve the very object for which it was founded.

The Treasurer has said that France, last year, bought from Australia goods valued at £46,000,000, but that we purchased from France goods worth only £4,000,000. He also said that a similar condition of affairs existed in our trade relations with Italy, and that last year we sold to European countries £85,000,000 worth of goods more than we bought from them. If a part of those purchases could have been financed through the fund, Australia’s obligation to repurchase dollars bought by it would diminish, or, indeed, vanish. At present countries which are in receipt of Marshall aid cannot borrow from the fund; but that condition is not likely to be permanent. If Australia does not participate in the fund it will not receive any benefits that may arise when the Marshall aid countries are brought within the ambit ‘ of the fund. Meanwhile, other nations are using the resources of the fund. They include Great Britain, which has purchased from it 300,000,000 United States dollars. What is the reason for Australia’s strange reluctance to take advantage of the fund, which is resulting in an accentuation of the shortage of goods which are sorely needed by Australian primary producers, hydro-electric authorities, transport authorities and, in. fact, by every section of the Australian community? The reason is not difficult to ascertain. When the Bretton Woods financial proposals were before the caucus, the Treasurer found that there was a great deal of antagonism towards the proposals among a section of his party. The Minister for Transport (Mr. Ward) was the leader of the opposition in this faction fight, and he extended his efforts so far that he refused to vote on the bills to give effect to the Bretton Woods agreement when they subsequently camp, before the House. From this background, it is apparent to any discerning or thinking person that the Treasurer has been reluctant to risk an open breach in his party by obtaining dollars from the fund. Thus, for the last few years, the Australian primary producer has been sacrificed on the altar of political expediency, and so also, as a consequence. has every productive unit in Australia. Because the Treasurer did not want to antagonize the Minister for Transport and his followers, the Australian producer has been denied for some years an adequate share of tractors, wire, petrol and thousands of other goods of hard currency origin which would have been available if we had had access to the necessary dollars with which to purchase them. There is another aspect of this matter which is worthy of mention. On the 9th July, 194S, the United Kingdom Government itself recommended to the Australian Government that it should apply to the fund for a dollar quota in order to relieve the dollar position in Australia. I think that the Prime Minister should move that his statement be printed so that there could be a debate upon it.

page 1752

PRIMARY SCHOOL, DARWIN

Report of Public Works Committee

Mr LEMMON:
Minister for Works and Housing · Forrest · ALP

– I move -

That, in accordance with the provisions of the Commonwealth Public Works Committee Act 1913-1947, it is expedient to carry out the following proposed work which was referred to the Parliamentary Standing Committee on Public Works and on which the committee has duly reported to this House the results of its investigations, namely: - Thu erection of a primary school at Darwin.

The existing accommodation for educational purposes at Darwin ‘ is totally inadequate and the erection of a new school has become necessary to provide teaching facilities for children of school age and for anticipated future requirements. The proposal which is estimated to cost £91,000 was fully explained to the House when, on the 22nd October of last year, I moved that it be referred to the committee for investigation and report. I concur in the committee’s decisions and recommend that approval be given to the proposed work.

Question resolved in the affirmative.

page 1752

STATES GRANTS (ENCOURAGEMENT OF MEAT PRODUCTION) BILL 1949

Second Reading

Mr DEDMAN:
Minister for Defence and Minister for Post-war Reconstruction · Corio · ALP

– I move -

That the bill be now read a second time.

The purpose of this bill is to make available to the Governments of Queensland and Western Australia special grants to meet, first, the capital costs of constructing or improving roads in the Channel country of south-west Queensland and the east Kimberley area of Western Australia and, secondly, half the capital costs up to specified limits of improvements of stock routes in those areas. The new and improved ‘ roads will facilitate the marketing of fat cattle from the two areas by enabling transport by road vehicles ; thus obviating the losses in both weight and quality at present caused by arduous journeys on the hoof. The stock routes in Queensland, which it is proposed to improve, serve, in the main, to bring cattle into the fattening areas of the Channel country. By improving these stock routes, the movement of store cattle from the Northern Territory and the north-west of Queensland will be facilitated. As the new road in the east Kimberleys will not tap all the cattle in the area served by the Wyndham meat works, it is considered necessary to improve certain stock routes along which cattle will continue to be moved to Wyndham on the hoof. This programme of road and stock route construction and improvement is part of the drive Australia is making to step up meat production so that the export surplus available to the United Kingdom can be increased. World shortages of meat supplies and the difficulties of purchasing beef in South American markets have prompted the United Kingdom to look to Australia as a potential source of further supplies. With this as one of its ends in view, the British Government early last year sent a party of experts to Australia under the leadership of Sir Henry Turner. They made various “ on-the-spot “ inquiries throughout the Commonwealth, and at the close of the visit submitted a report outlining their conclusions. Amongst other things, they recognized that northern Australia offered possibilities for increased beef production, and that a quantitative and qualitative improvement in turn-off could be expected if better transport facilities were available.

Discussions with the United Kingdom authorities were continued in London by the Prime Minister in July last year and !by Commonwealth officers during the following September and October. It was pointed out to the British authorities that much investigational work was necessary before the Commonwealth could put forward any firm proposals, and that, although at that time detailed figures were not available, it was clear that, to increase substantially the exportable surplus of meat, the Government as well as producers would have to undertake a considerable programme of development. Moreover,, meat supplies could not be expected to increase immediately but would increase by a gradual process spread over many years. A long-term meat agreement was sought from the United Kingdom authorities in order to safeguard the Government and producers alike in the commitments they would have ito undertake over a lengthy period to achieve greater output. In further discussions the Prime Minister had in London last April with United Kingdom Ministers, they stressed the importance of obtaining increased meat supplies from Australia, and urged the Commonwealth to promote developmental schemes designed substantially to raise exports to the United Kingdom to an agreed level within an agreed period. They declared their willingness, in return for an undertaking on the part of the Australian Government, to promote schemes offering a. good prospect of increased supplies, to enter into arrangements that will guarantee a market, at reasonable prices, in the United Kingdom for the whole of the exportable surplus of meat from Australia up to a specified ceiling during a period of fifteen years. It was than decided that negotiations for a formal agreement would take place as soon as the Commonwealth had completed its investigational work and formulated concrete plans for greater production. These negotiations are at present being carried on in London on the basis of a number of firm propositions which are aimed at encouraging meat production. Development, through the aid of better transport facilities, of the Channel country of south-west Queensland and the area served by the Wyndham meat works which also embraces the Victoria River region of the Northern Territory forms part of those propositions.

In the Channel country it is proposed to construct and improve 528 miles of roads, provide facilities for loading and unloading cattle at eight selected points along the roads, and improve, by the provision of more frequent watering places,’ various stock routes serving the area. The details of these works are set out in clause 4 of the bill. Provision is made for the Queensland Government to be reimbursed for half the capital cost of the stock route improvements, up to a limit of £75,500, and the full capital cost of the other works, which is estimated to be £900,000. It is expected that, by facilitating the movement of cattle to and from the fattening areas of the Channel country, the present average annual turn-off of 60,000 head of cattle will be progressively increased over a period of five years to 100,000 head, and that the resultant increase in terms of dressed beef will be of the order of 12,000 tons a year. In the east Kimberley area of Western Australia, it is proposed to construct an all-weather road from Wyndham to Nicholson Station, a distance of approximately 282 miles. This will involve the building of a major bridge over the Ord River at Buttons Crossing. Improved watering facilities along certain stock routes are also proposed. Clause 5 of the bill outlines these works in detail. Provision is made for the Commonwealth to meet the full capital cost of the road, which is estimated to be £1,159,000, and half the capital cost of the stock route improvements, subject to an upper limit of £31,500. As the Victoria River region of the Northern Territory is also within the area supplying the Wyndham meat works, two feeder roads are to be constructed from the main WyndhamNicholson road to Victoria River Depot and Wave Hill Station. These feeder roads, which measure 225 miles, will he almost entirely within the Northern Territory. As their construction will be carried out by the Commonwealth, the provision of finance in the present measure is not necessary. Improved transport facilities in the area serving the Wyndham meat works will, it is estimated, enable the present beef output of 8,000 tons per annum to he increased to 18,000 tons over a period of ten years. When the expected increases of annual beef tonnages from the Channel country and the Wyndham area which amount to 12,000 tons and 10,000 tons respectively, are measured against the total quantity of frozen beef, exclusive of offals and canned meat, that was exported from Australia during 1948- 49, and amounted to approximately 85,500 tons, it will be seen that they represent substantial gains. These potential increases of the output of beef fully justify the works being undertaken with the greatest possible expedition. The bill provides for plans and specifications of the works in both States to incorporate the standards of design determined by the Commonwealth, but the States are free to raise these standards, if they so desire, at their own expense. It is proposed that the Treasurer shall make advances to the States and settle on the basis of halfyearly statements of expenditure certified by the State Auditors-General.

I add, as a matter of interest, that the Commonwealth’s plans for encouraging meat production also include extensive developmental measures in parts of the Northern Territory outside the Victoria River region. The Government’s plans for those areas1 provide for the construction of 1,400 miles of roads at an estimated cost of £337,000, and the expenditure of £170,000 upon improvements to stock routes. In addition, the Government has approved of a station development scheme for the Northern Territory. To assist in the implementation of the scheme the Commonwealth will contribute £1,500,000 towards the cost of additional watering points on stations. It is expected that, as a result of these measures and of co-operative effort on the part of private interests, the cattle population of the Northern Territory can be progressively raised from the present figure of about 1,000,000 to something like 1,600,000. This will, in turn, increase the number of beasts available each year for marketing, and enable an ultimate annual increase of approximately 38,000 tons of beef to be obtained after a period of, say, fifteen years from those parts of the Northern Territory outside the Victoria River region. I commend the bill to honorable members.

Debate (on motion by Mr. Francis) adjourned.

page 1754

INCOME TAX ASSESSMENT BILL 1949

Second Reading

Debate resumed from the 19th October (vide page 1682), on motion by Mr. Dedman -

That the bill toe now read a second time.

Mr DEDMAN:
Minister for Defence and Minister for Post-war Reconstruction · Corio · ALP

– in reply - This- bill provides for an increase of the maximum rebatable amount in respect of superannuation fund contributions, life insurance premiums and payments of a similar kind from £100 to £150. The only other matter with which it deals is the depreciation allowance in respect of machinery. Four members of the Opposition have spoken to the motion for the second reading of the bill. They are the honorable member for Warringah (Mr. Spender), the honorable member for Fawkner (Mr. Holt), the honorable member for Parramatta (Mr. Beale) and the honorable member for Balaclava (Mr. White) . I am certain that if a prize were given for the best speech based upon cant, hypocrisy and humbug, it would be awarded to the honorable member for Warringah for the speech that he made last night. The honorable gentleman attacked the proposal to increase the rebateable amount from £100 to £150 and suggested that the principal reason for it is that it will benefit Labour members of the Parliament. That point has been laboured not only by the honorable member for Warringah, but also by the press of this country. There is no truth whatever in the allegation. The honorable member for Warringah has himself made representations to the Treasurer (Mr. Chifley) upon this matter. On the 25th November, 1948, he presented to the Treasurer a letter that he had received fro.m, one of his constituents, who had stated that in the year ended the 30th June, 1948, he had contributed £241 10s. 8d. to a superannuation fund. The honorable gentleman requested that consideration be given to the request of his constituent that the rebateable amount should be increased beyond the figure of £100 at which it then stood.

Mr Thompson:

– When did the honorable gentleman make that request?

Mr DEDMAN:

– On the 25th November, 1948, he presented a case to the Treasurer in support of an application from a constituent to have the rebatable amount increased to meet his constituent’s needs. The constituent had said that his payments to a superannuation fund were approximately £241 a year. It is clear that the honorable gentleman was speaking with his tongue in his cheek when he raised this matter in the House last night.

Mr Turnbull:

– Is it proper for the Minister at this stage to divulge the contents of that letter ?

Mr DEDMAN:

– The honorable member for “Wimmera (Mr. Turnbull) is not my mentor in this matter.

Mr Turnbull:

– I have asked the Minister a question.

Mr DEDMAN:

– I contend that a Minister or any other member is entitled to use any evidence that comes into his possession which shows that a member of the Parliament has been guilty of hypocrisy and humbug of the kind in which the honorable member for Warringah indulged last night.

Mr Turnbull:

– Is that the Minister’s answer ?

Mr DEDMAN:

– That is my answer. The honorable member for Warringah is not the only member of the Opposition who has raised this matter. On the 17th November, 1948, representations were made in this House by the honorable member for Flinders (Mr. Ryan) on behalf of service personnel. The honorable gentleman pointed out that senior officers were contributing sums of from £200 to £400 a year to superannuation funds, and he said that, while the maximum rebateable amount remained at £100, a very heavy burden was imposed upon those officers/ The honorable gentleman asked the Treasurer to see whether it would be possible to increase the amount of the rebate. On the 25th May of this year the honorable member for Fawkner, speaking in this House, directed attention to the greatly increased amount of estate duty that was payable upon estates and to the depreciated value of the pound, and stated that Australian citizens had found it necessary to insure themselves for large sums of money in order to provide for the security of their families.

He asked the Treasurer whether the Government had given or would give consideration to increasing the maximum amount of the rebate in respect of premiums paid upon those policies. The Treasurer said, in reply, that the representations that honorable members on the Opposition benches had made in regard to that matter would receive consideration before the budget session. It can truly be said that one of the reasons for the introduction of this provision is that honorable gentlemen opposite have made representations with regard to it.

They are not the only persons who have made such representations. It is quite untrue to say that this measure is designed merely to benefit Labour members of the Parliament. From time to time a number of organizations have made representations to the Treasurer upon this matter. Representations have been received from the Associated Chambers of Commerce in Australia and from the United Bank Officers Association, an association that, in another sphere, is using all its resources and some resources that, in the opinion of some of us, it is not entitled to use - < -

Mr Beale:

– What does the Minister mean by that?

Mr DEDMAN:

– I mean what I say. [Quorum formed.] The United Bank Officers Association has made representations with regard to this matter. That organization, in another sphere, is using all the resources at its command and, in the opinion of some persons - I repeat this for the benefit of the honorable member for Parramatta - some resources that should not be used for the purpose, to endeavour to bring about the downfall of this Government. Those efforts will be in vain, but it is interesting to note that the association is one of the organizations that has made representations to the Treasurer about this matter. The Queensland Cane-Growers Council, the High Council of the Commonwealth Public Service Organizations, the Victorian Teachers Union, the New South Wales Teachers Federation and the Taxpayers Association of New South Wales have made similar representations. Incidentally, the Taxpayers Association of New South Wales is generally antagonistic towards the Labour party, and to anything that the party does. There fore, it becomes clear that the increased concessions that are declared in this measure have not been inspired, as suggested by certain sections of the press and the honorable member for Warringah, by pressure from members of the Parliament or the Labour party. The concessions are the result of the consideration that the Treasurer has given to the matter after representations had been made to him by the various organizations that I have mentioned and by a number of members of the Opposition, including the honorable member for Warringah in a particular case. That is why I say that the speech by the honorable member for Warringah was a prime example of cant, hypocrisy and humbug.

The honorable member for Warringah also suggested that the amount allowable to employers in respect of their contributions to employees’ superannuation funds, should be increased from £100 to £150. The limit of £100 that is allowed to employers at the present time was fixed in 1944 in order to prevent the exploitation of income tax allowances for the benefit of a favoured few executives of big companies. I cite a specific instance. A certain company in Melbourne, was expending large sums of money to provide not superannuation benefits for the rank and file employees, but huge benefits for its highly paid executives. I need hardly state that those in charge of that company are completely opposed to the Labour party. The limit of £100 was fixed in 1944 in order to prevent the exploitation of that allowance. However, the Government recognized at the time that, in some instances, the limit of £100 would be insufficient, and, consequently, the Commissioner of Taxation has been granted a discretionary power to increase the amount that is allowable to an employer. Of course, the Commissioner of Taxation is not allowed any discretion in respect of the increase of the allowance from £100 to £150 provided in this bill and to which I have previously referred. Employers are treated most generously in this matter. That explanation disposes of the second point that was raised by the honorable member for Warringah.

In the course of the debate, the honor- able member for Balaclava (Mr. White) emphasized the importance of tin production to the Australian economy, andi advocated a total exemption of tin-mining; profits similar to the exemption allowed5, to the gold-mining industry.

Mr Beale:

– A few moments ago, the’ Minister referred to a discretionary power that is vested in the Commissionerof Taxation. What is the section im which that provision is made? .

Mr DEDMAN:

– If the honorable gentleman will see me later, I shall show him the section, and even read it to him should he require any assistance.

Mr Beale:

– I do not need any assistance to read the section. All I want, is the truth.

Mr DEDMAN:

– If the honorablemember for Balaclava had understood’ the provisions relating to the tinminingindustry, he would not have made the-‘ statements that he made last night.. At present, profits from tin-mining in Australia are exempt to the extent of 20 per cent.

Mr White:

– I said that.

Mr DEDMAN:

– In addition, dividends out of the exempt profits are freefrom tax in the hands of shareholders.. Those exemptions were granted by theGovernment in 1942 because of the need: to increase the production of tin. Although that emergency has passed, those provisions have been continued. From timeto time the Government has considered’ claims of the kind that the honorable member has advanced, but, to date, it hasnot seen its way clear to make further concessions either to the tin-mining industry or-

Mr White:

– Why did the Ministersay that I did not understand the position?”

Mr DEDMAN:

– The honorable member has already spoken on this bill, and’ I did not interrupt him. The honorablemember misleads the House.

Mr White:

– So does the Minister.

Mr DEDMAN:

– I may mislead the House occasionally by accident, but thehonorable member misleads the House byintent.

Mr White:

– This offensive Ministerhas made an extremely offensive statement, and I ask you, Mr. Acting Deputy Speaker, to request him to withdraw it..

Mr ACTING DEPUTY SPEAKER:
Mr. Sheehy

– Order! I ask the honorable member for Balaclava to resume his seat.

Mr White:

– I rise to order.

Mr ACTING DEPUTY SPEAKER:

– Order! I remind the honorable member that the Standing Orders provide that a member shall rise to his feet, call the Chair and wait until he receives the call from the Chair.

Mr White:

– I rise to order. The Minister, in his speech, has only confirmed what I said last night.

Mr ACTING DEPUTY SPEAKER:

– There is no point of order.

Mr White:

– The Minister has made an offensive remark about me.

Mr ACTING DEPUTY SPEAKER:

– Order! 1 ask the honorable member to resume his seat.

Mr White:

– The Minister has said tb at I mislead the House.

Mr ACTING DEPUTY SPEAKER:

– Order !

Mr White:

– Very well, the Chair does not take any notice of my point of order !

Mr Barnard:

– It is a point of humbug.

Mr.- White. - During the general election campaign I shall speak in the electorate of Bass, which the Minister for Repatriation (Mr. Barnard) represents, and I shall shift him.

Mr Barnard:

– The honorable member will have a most difficult task.

Mr ACTING DEPUTY SPEAKER:

– Order ! These interjections must cease.

Mr DEDMAN:

– The Government is watching very closely the effects of taxation on industry, including the mining industry, and, in due course, when it considers that it is possible to do so, it will carefully examine the submission of the honorable member for Balaclava.

Mr White:

– Why did not the Minister say that earlier?

Mr DEDMAN:

– The honorable member for Warringah raised- a matter in relation to the 40 per cent, initial depreciation allowance on machinery.

Mr Duthie:

– That is a good move.

Mr DEDMAN:

– It is an excellent move, and shows that this Government is doing everything that it can to assist industry generally.

Mr Thompson:

– And not the big industries alone.

Mr DEDMAN:

– The Government assists industries, large and small. If the honor*ble member for Warringah had understood the provisions of the act, he would not have made the statements that he made last night. These provisions in the bill need not be extended to the mining industry, because the existing tax allowances for mining plant are framed on a most liberal scale. At this point, I make it clear that I am referring strictly to the mining industry. The depreciation allowance that is provided for in this bill relates to the depreciation allowance on all machinery, but special provision is made for machinery that is used in the mining industry. That provision is more liberal than the provision which is contained in this bill. Therefore, the honorable member’s suggestion that the Government should make the provision for the mining industry more liberal was actually given effect long ago.

Mr White:

Mr. White interjecting,

Mr DEDMAN:

– I am addressing my remarks, not to the honorable member for Balaclava, but to the honorable member for Warringah. Apart from coal-mining, companies engaged in mining operations are allowed to deduct the whole of the expenditure on plant in the year in which that expenditure is incurred. Eoi- tax purposes, the whole of the expenditure may be deducted in the first year. This bill makes provision for the increase of the amount allowable from 20 per cent, to 40 per cent, in the first year, but a provision is already in operation to the effect that the whole of the cost of plant for the mining industry may be written off in the year of purchase. The mine-owner, if he desires to do so, may elect to deduct the cost of the plant over the period of the estimated life of the mine. In fact, the mine-owner is in a position to obtain even better treatment in respect of depreciation of machinery than is provided for in this bill.

Mr Holloway:

– It is greatly appreciated by the gold-mining industry.

Mr DEDMAN:

– Yes. In the mining industry, companies, particularly small ventures, are often in a position to make fairly high profits in the first year or two years of operation, and it is of great advantage to them to be able to wipe off in that way as depreciation the total value of their plant. After operating for a few years, the companies might discover that the mineral was petering out, and they would be unable to obtain any return by way of depreciation allowance for the machinery.

The honorable member for Parramatta, who asked me about a particular section of the act, referred to the need for simplifying the income tax law. He suggested that the Government should revert to the system of concessional deductions instead of retaining the present system of concessional rebates of tax. Of course this matter of rebates versus deductions is repeatedly raised in the House. The Prime Minister (Mr. Chifley) has frequently pointed out that the decision to adopt the rebate system was made on the recommendation of an allparty committee on taxation, on which the Opposition parties were represented. A former member for Robertson, Mr. E. S. Spooner, was a representative of the Opposition on that committee, and as the result of his recommendation, the rebate system was adopted by the Parliament. The reason for adopting the recommendation was not that which the honorable member for Parramatta has stated. Indeed, the honorable gentleman made an untrue statement when he said that the rebate system was introduced in order to obtain more revenue.

Mr White:

– Nobody believes the Minister.

Mr DEPUTY SPEAKER (Mr Clark:
DARLING, NEW SOUTH WALES

– Order! I ask the honorable member for Balaclava to refrain from interrupting. If he does not do so, I shall have to ask him to leave the chamber. If he does not do so voluntarily, other measures will be taken.

Mr White:

– I shall leave the chamber voluntarily now, because I cannot stand this speech any longer.

Mr DEDMAN:

– The statement by the honorable member for Parramatta that the rebate system was introduced in order that the Treasurer would be able to collect more revenue was completely untrue. The rebate system was introduced because of the complications that were brought about by the introduction of uniform income tax. Various deductions were allowable in certain States when they imposed their own income taxes, and over and above them, a system of deductions was applied in Commonwealth income tax. The Government realized that most complicated situations would arise if an endeavour were made to fix a sum, on the Commonwealth level, as the basis of a deduction, in an attempt to give every taxpayer as much benefit as he had received under the dual system of taxation. Because of that situation, the all-party committee recommended to the Parliament that the rebate system be adopted. On the average, and speaking generally, I believe that the benefit to taxpayers to-day under the rebate system is greater than the benefit that taxpayers received under the deduction system prior to the introduction of uniform income tax.

Mr Beale:

– That has been proved to be wrong.

Mr DEPUTY SPEAKER:

– If the honorable member for Parramatta (Mr. Beale) interrupts again I shall name him.

Mr DEDMAN:

– It has not been proved wrong. When the Parliament meets again after the election, I shall rise in my place-

Mr Beale:

Mr. Beale interjecting,

Mr DEPUTY SPEAKER:

– Is the honorable member for Parramatta aware that I threatened to name him? I drew his attention to the fact that his conduct is not acceptable to the House.

Mr Beale:

– I desire to make a personal explanation.

Mr DEPUTY SPEAKER:

– The honorable member is not entitled to make a personal explanation. He has been disorderly, and I have called his attention, and that of the House generally, to the fact. I shall name him if he interrupts again.

Mr DEDMAN:

– The honorable member for Parramatta was wrong when he denied that the benefits to the taxpayers under the rebate system are, on an average, greater than they were under the deduction system which was in operation before the introduction of uniform income tax. After the election, I shall rise in this House and cite figures to convince the honorable member that he was wrong.

The next point raised by the honorable member for Parramatta was that income tax rates should be fixed in accordance with defined grades instead of on a sliding scale, increasing with every pound of income. For instance, he suggested that, instead of the rate being increased by Id. for every additional £10 of income, the increase should be lOd. for every £100 of additional income. On the surface, that system looks very well, but it has been found in practice to introduce into income tax assessment a rigidity that gives rise to difficulties when the rates are changed. That is why, in almost every country in which the system advocated by the honorable member was introduced, it was later abandoned, and the system now in operation in Australia was reverted to. If we were to carry the honorable member’s argument to its logical conclusion, wo should not stop at grades of £100, but should make them £500, and say that the rate should be varied only for every £500 of additional income. Actually, the method of varying the rate by one-tenth of a Id. for every £1 of additional income does not introduce any inherent complexity; it is only a refinement of the very system which the honorable member himself has advocated.

The honorable member for Parramatta also said that the time allowed for the lodgment of objections to income tax assessments was too short. Before the system of uniform income tax was introduced, the time allowed for lodging objections varied in the different States. In some States, it was two months, in one it was 40 days, while in another only one month was allowed. At that time, the period allowed by the Commonwealth was 42 days, but for uniform income tax purposes we fixed the period at 60 days, the longest period allowed in any of the States. I remind the honorable member that the period of 42 days previously allowed by the Commonwealth was fixed under a government supported by a poli tical party of which he himself is now a member. I believe that 60 days ought to be ample for any taxpayer to make up his .mind whether he wants to challenge his assessment. At any rate, it is eighteen days longer than used to be allowed by previous governments.

The honorable member for Parramatta also criticized the provision in the Income Tax Assessment Act which requires persons about to leave Australia to obtain a certificate of clearance from the Commissioner of Taxation. He suggested that the provision was applied too rigidly in the case of taxpayers leaving Australia for only a short period. As the honorable member probably knows, the purpose of the provision is to ensure that any taxpayer who has a tax liability should shall not be allowed to leave Australia without provision having been made for discharging that liability. That is why he is required to obtain a certificate from the Commissioner of Taxation. However, it is not true that in every instance the taxation authorities insist upon payment before the person leaves the country. It is sufficient that he obtain a guarantor, and every business man of any standing in the community ought to be able to obtain a guarantor for such a purpose. If the honorable member has in mind any cases of hardship, I am sure that it will be only necessary for him to bring them to the notice of the Treasurer (Mr. Chifley), who will, as usual, give them sympathetic considera-tion.

The honorable member for Warringah spent a long time sympathizing with what he called taxpayers on the middle ranges of income. I interjected in an endeavour to find out just what he meant by that term, and the answer I obtained was that he was speaking of those on incomes of £500 and £600 a year. I should not regard such incomes as being in the middle range in these days.

Mr Thompson:

– I think that the honorable member later said that the range he had in mind was that between £600 and £800.

Mr DEDMAN:

– I am sorry that I did not hear the honorable member correct himself. The fact is that this Government has made many and large concessions to taxpayers in the lower and middle income groups. If the honorable member for Warringah were to examine particulars of what the Government has done for this section of income-tax payers, he would realize that his arguments were not soundly based. Apart from the reduction of rates, the Government has granted relief in the form of increased concessions to the family man. The allowance for a wife has been increased from £100 to £150, that for the first child from £75 to £100, and those for other children from £30 to £50. In addition, new allowances have been made in respect of dependants, such as for school children between the ages of sixteen and nineteen year’s. Allowances for medical expenses have been increased. The allowance used to be limited to £50 for the taxpayer, his wife, and children up to the age of 21 years. Now the taxpayer is allowed £50 for himself, £50 for his wife, and £50 for each of his children up to the age of 21 years. Those provisions are much more liberal than the provisions in force when this Government took office. I am convinced that the honorable member for Warringah will not, upon an examination of the facts, find anything to support his assertion that this Government has overlooked the middle classes in framing tax reduction measures and social services benefits.

All this criticism has arisen from a very simple measure, the purpose of which is to provide two further concessions to taxpayers : to raise the rebateable amount in respect of contributions to superannuation funds, and other funds of the kind, from £100 to £150 ; and to make more generous provision for depreciation allowances.

Mr Beale:

– Will the Minister refer to my suggestion that the rate on income from property should be the same as that on income from personal exertion, plus a fixed percentage?

Mr DEDMAN:

– It is not easy for me at this stage to understand the point made by the honorable member. I apologize to him for not having picked it up as he was speaking. However, when I am back here once more after the election, I shall give the honorable member a reply. In addition to the concessions provided in this bill, the Government has, since the peak period of the war, granted tax concessions amounting to £1S6,000,000 a year. Such concessions and benefits will be appreciated by .the people of Australia. I hope that when the Government has been returned to office after the election, it will be able to present to the Parliament an income tax assessment bill as satisfactory as, I am sure, this one now is to the people.

Question resolved in the affirmative.

Bill read a second time.

In committee:

The bill.

Mr BEALE:
Parramatta

.- The Minister for Post-war Reconstruction (Mr. Dedman), in a particularly aggressive speech on the motion for the second reading of the bill-

The DEPUTY CHAIRMAN (Mr. Burke). - The committee can take no notice of what was said during secondreading speeches in the House.

Mr BEALE:

– In his speech the Minister made some points of which I believe I ought to take notice.

The DEPUTY CHAIRMAN.- The honorable member may not take notice now of what was said in the House.

Mr BEALE:

– Everybody welcome’s tax concessions, and we on this side of the chamber are going to vote for this bill on the principle that half a loaf is better than no bread. My point is that the concessions provided for in the bill do not go far enough. I invited the Minister to consider a number of suggestions which were put forward, not in a party spirit, but with a sincere desire to afford relief to taxpayers. Those concessions would not involve the Treasury in any diminution of revenue.

The DEPUTY CHAIRMAN.- Order ! Although the committee has decided to take the bill as a whole, honorable members must deal with particular provisions of it.

Mr BEALE:

– I am dealing with the concessional allowance in respect of contributions to pension funds and the proposal to increase the amount of the allowance from £100 to £150 a year. It has been said that it is a remarkable coincidence that that is proposed to be done at the time when the parliamentary pensions system is coming into operation and that it is within a few shillings of the amount which members of Parliament are required to contribute in order to qualify for the pension. I need not say any more about that, because it has been fully ventilated, but, when the Minister goes as far as he can within the Standing Orders, if not beyond the Standing Orders, to assert that it is false to say that the two amounts bear a relationship, I say to him that the proof of the pudding is in the eating of it. “We have been clamouring for years for an increase of the amount deductible in respect of such payments, but the amount has not been increased until now when the parliamentary pensions scheme is coming into operation. It remains for the people of Australia to judge that matter. The Minister’s argument that the concessional rebate system is more profitable-

The DEPUTY CHAIRMAN. - Order ! The Chair has already ruled on that matter. The bill has nothing to do with concessional rebates.

Mr BEALE:

– With great respect, Mr. Deputy Chairman, the matter that I have been dealing with is a concessional rebate. It is one of the rebates provided for in the principal act.

The DEPUTY CHAIRMAN.- The only concessional rebate that may be dealt with is the one provided for in the bill.

Mr BEALE:

– I should like it to take the form of a straight-out deduction instead of a concessional rebate. No practising accountant or long-suffering taxpayer will believe the Minister when he says that the concessional rebate system is better for him than the straightout deduction system.

Mr HOLT:
Fawkner

. - I take advantage of the committee discussion of the bill to place a matter before the Minister for Post-war Reconstruction (Mr. Dedman) as the lieutenant of the Treasurer (Mr. Chifley). I regret I was not present when he closed the debate on the second reading. It is possible that he covered, in part or wholly, the matter that I am about to raise. It was brought to my notice by the Australian Mines and. Metals Association (Incorporated), which, no doubt, has made representations to other members of the Parliament. The association requests that the provision extending the operation of section 57a for an additional period and increasing the allowance from 20 per cent, to 40 per cent, shall be applied to mining companies as well as to manufacturing companies. I understand a copy of the letter, from which I am about to read, was sent to the Treasurer.. The letter reads -

This Association has perused the Bill introduced by the Government on the 9th instant to amend the Income Tax Assessment Act by inter alia -

Extending the operation of Section 57a for an additional period of two years; and

Granting taxpayers the right to deduct an initial allowance of forty per cent, in lieu of twenty per cent, as already provided in that Section.

We understand that at the time of the incorporation of Section 57a in the Act in 1946 it was officially explained that this increased allowance was granted, with the object of offsetting the post-war inflated cost of new machinery, assisting the establishment of new enterprises and aiding secondary industries in securing overseas markets.

This provision has, of course, been of considerable immediate value to manufacturing industries, but such relief has not been received by mining companies, to which Division 10 of the Act is applicable, as no corresponding amendment has been made to Section’ 122.

It is recognized that under Section 123 a mining company is entitled to deduct the total development and capital expenditure in the year in which it is incurred, but this provision is not always availed of as the large appropriations of profit necessary to qualify for the allowance would frequently leave an insufficient amount for the other requirements of these companies.

This position would clearly be accentuated with the existing inflated capital expenditure costs.

The alternative Section 122 is therefore in many cases applied and the deduction of such expenditure is spread over the estimated life of the mine.

It is accordingly submitted that, in equity, an amendment should also be made to this Division to grant mining companies an initial allowance in respect of capital expenditure and we suggest that Section 122 be modified to entitle a taxpayer, in respect of the years of income ending on the 30th June, 1950, 1951 and 1952, to elect to deduct either twenty per cent, or forty per cent, of the expenditure of the year as a special allowance, the residue to be amortized over the estimated life of the mine as at present.

The association asks that this matterbe examined while we are considering this legislation. I understand that the Government’s view is that the mining companies may deduct the whole expense incurred on machinery and equipment in the year in which it is incurred. Perhaps the Minister made some reference to that point when replying to the secondreading debate, but, as the association points out, to take in that year, by way of deduction, the total cost of the machinery and equipment purchased might mean such a heavy inroad into the earnings for that year that it would not be a practicable proposition. Since the desire of the Government is to assist manufacturers and producers of various kinds in this way, I suggest to the Government that its advisers might confer with the representatives of the mining companies. If what the Government proposes does not meet the situation and if the alternative suggested by the mining companies would not involve the Commonwealth in any greater loss of revenue, it might be possible to comply with the request. It would not appear that the Commonwealth would lose for the companies can take depreciation only once, and it does not matter much whether they take it in one year or spread it over a period of years. If that aspect has not been fully considered, perhaps a conference between taxation officers and the representatives of the mining companies could be arranged by the Treasurer.

Mr DEDMAN:
Minister for Defence and Minister for Post-war Reconstruction · Corio · ALP

– I dealt with this matter at the second-reading stage, and I do not propose to deal with it at any length now. The proposal has already been closely examined by the Government. The mining companies have two choices at present. They may deduct the expenditure in the year in which they incur it or spread the deductions over the estimated life of the mine. It seems to me that, as the mining companies have the choice of two methods, to give them a third choice would he unwarranted. If they were given a third choice, it would not be long before they would want a fourth. However, I promise the honorable member for Fawkner (Mr. Holt) that the matter will be examined when taxes come up again for discussion.

Bill agreed to.

Bill reported without amendment; report adopted.

Bill - by leave - read a third time.

page 1762

COMMONWEALTH AID ROADS AND WORKS BILL 1949

Second Reading

Debate resumed from the 8th September (vide page 147), on motion by Mr. Ward -

That the bill be now read a second time.

Mr McDONALD:
Corangamite

– This bill provides that an additional £1,000,000 shall come out of the federal Treasury for use on the construction of roads in sparsely settled areas. For several years, we have had similar bills presented to us. The original amount appropriated for the purpose was £1,000,000 ; last year, it was increased to £2,000,000, and, this year, it is proposed to expend £3,000,000. This expenditure on roads in sparsely-settled areas will greatly assist the local-governing bodies that are responsible for the construction and maintenance of those roads. Unfortunately the bill does not go far enough. In spite of the fact that road authorities have been set up in the several States for State purposes the localgoverning bodies in New South Wales, Queensland and Victoria are to-day responsible for from 80 to 85 per cent, of the existing roads, so that the bulk of the money made available by the Government is being used on only about 20 per cent, of the roads in the Commonwealth. When Commonwealth aid to the States for the purposes of road construction and maintenance was introduced a petrol tax was instituted to provide the necessary funds. The tax originally was very small, about 2d. or 3d. a gallon, but, to-day, it is substantial, amounting to 101/2d. a gallon. It is a sore point with local-governing bodies that although about £17,000,000 was raised last year by means of the petrol tax, only about £7,000,000 was devoted to the purpose for which the tax was originally instituted. Still, we are improving and should be grateful for small mercies, for it would appear that about 50 per cent, of the receipts from the petrol tax will eventually be devoted to road making and maintenance.

Perhaps it is wise to remind the House that roads have played an important part in our transport problems, especially in the last twelve months, during which there were periods in which we had practically no train services in several States and it was left to road transport to convey not only goods but also passengers. Foi five or six weeks, not one passenger train ran between Melbourne and Warrnambool, through the Western District, where the land is among the best in Victoria, and it was left to ‘buses owned by private enterprise to fill the breach and do the job. It cannot be wondered at that the operators of those services, who, for years, have paid substantial sums in petrol tax, complain that not sufficient of the proceeds from the tax is being expended on roads. There was never a time when the Government could better afford to make a greater proportion of the petrol tax revenue available for road purposes than it can at present. In spite of the oftrepeated claims of honorable gentlemen opposite that taxes have been substantially reduced, the hard fact remains that, last year, a greater sum was collected from taxes than was ever collected before in the history of Australia. It would be reasonable, when the Treasury is overflowing, to expect that a large part of the money derived from the petrol tax would be used to make it possible for motor transport to operate. Motor transport is actually providing the greater pari of the revenue from -this tax. Local government authorities are to-day at their wits’ end to carry on the duties that aw solely their responsibility, and they claim that while the Commonwealth is. making money available to the States it should, also make a proportion of the receipts from the petrol tax available to local governing bodies to permit them, with the machinery that they have at hand and the expert knowledge they possess of their own localities, to construct and maintain loads. I commend this claim to the Minister. Only recently I had an opportunity to introduce to the Prime Minister (Mr. Chifley) a deputation representing the Australian Council of Local Government Associations, which put to him the case that when future allocations were being decided upon, it would be a good proposition that that body, and the existing State bodies, should be consulted so that the money would be allocated to the best possible advantage. The Prime Minister admitted that there was quite a lot of merit in that suggestion, and I believe that he undertook to con sult with these bodies in future. Nobody is opposed to this bill. If there is any complaint it is that the proposed allocation is not larger. We believe that roadsin sparsely settled areas must be improved and extended, and that the Commonwealth is acting rightly when it makes an additional sum available for this purpose.

Mr DUTHIE:
Wilmot

.- I am quite sure that this bill will meet no real opposition from honorable members opposite. It will be applauded on all sides. I agree with the honorable member for Corangamite (Mr. McDonald) that, although the amount provided may not be so large as many municipalities may desire, it is a step in the right direction in that it represents an increase over similar allocations in the last two years. In 1947, when the original bill was introduced for the purpose of allocating to municipalities a sum drawn from tb petrol tax receipts for expenditure on outback roads, the allocation was £1,000,000. In 194S, the allocation rose to £2,000,000. Many of us have made representations in this Parliament and also, as far as this side of the House at least is concerned, in the party caucus, with the result that the allocation for the current year has been increased to £3,000,000. Honorable members opposite also made similar representations. If we can achieve an increase of £1,000,000 in the allocation each year we shall reach a sum of money that should bring satisfaction to all municipalities. I cannot guarantee, of course, that we can achieve such an increase every year, but I, for one, shall certainly work toward that objective. I agree with most of the remarks of the honorable member for Corangamite, who is himself a’ municipal shire councillor, and has done much good work in Victoria in connexion with local government activities. Taking it all round, the municipalities in Tasmania have played the game in carrying out their responsibility to expend the allocation to the best advantage. As far as I am aware, no municipality in Tasmania can be charged with having abused the privileges it enjoys under this legislation. Many municipalities in Victoria may claim that they have not been assisted as much as they should have been, for reasons over which we have no control. Tasmania received £50,000 from the sum of £1,000,000 that was allocated to the States in the first year of the act’s operation. In the second year it received £50,000 from the allocation to the States of the sum of £2,000,000. The second allocation of £50,000, however, was retained by the Tasmanian Government for work on bridges in remote areas throughout the State, and municipalities did not receive any of it. However, that fact, in itself, will be of tremendous importance to Tasmania, which is very mountainous and has, I believe, more rivers to the square mile than have most other parts of the world. For that reason bridges are an important means of communication in that island, and although when the money was withheld by the State Government the honorable member for Darwin (Dame Enid Lyons) and I sought to have it made available to the municipalities as had been done in previous year, we found later that the municipalities had themselves agreed at a conference with the Tasmanian Minister for Lands and Works, Mr. Reece, that it should be used for work on bridges. I think that that expenditure will be very beneficial indeed to Tasmania’s transport system, as many of that State’s outback bridges are in a deplorable condition and are completely unsafe and dangerous for traffic. Many of them were built 50 years ago, and some of them are even older than that. They are now completely out of date in design and are hopeless for coping with the big modern transport trailers and trucks that have to use them. Now that the Tasmanian HydroElectricity Commission is extending its activities farther into the hinterland of that State, bridges have to carry greater loads and are being subjected to increased strain.

As the allocation to the States is to be increased to £3,000,000, Tasmanian municipalities can probably expect, with, confidence, to receive another £50,000 for road works during this financial year, making a total to date of £150,000, as the Tasmanian Government has promised that it will retain for work on bridges only the allocation of £50,000 that it received last year. That allocation will assist the municipalities, particularly the big municipalities which, though small in population, cover very large areas, to maintain existing roads and build new “highways.

The need for more roads has been stressed over and over again and I do not wish to canvass tha.t aspect except to say once again that municipalities in Tasmania have benefited tremendously from the petrol tax, and are grateful for the assistance that has been given to them. They may consider that they have not received enough money for their purposes, but the increase in this year’s allocation to the States should help enormously, particularly in the purchase of earthmoving equipment. Municipalities are becoming more mechanized and they will be able to do in one day work which previously took probably a week to do under the old- system. The allocation to the municipalities enables them to purchase equipment, the importation of which from even the dollar area has been permitted by the Australian Government, to assist in this very worthwhile objective of mechanization. Improved and extended road services are necessary to cope with increased motor vehicle traffic. I shall cite -figures referring to municipalities in my electorate so as to give honorable members some conception of how they have benefited from the petrol tax. The following are the details, which are contained in a list with which the Minister for Transport (Mr. Ward) has very kindly supplied me -

That is a very large sum to be allocated -to one federal electoral division.

I shall conclude with some remarks about the Road Safety Council, which is supported by money from the petrol tax. 1 hope that I shall be in order, Mr. Deputy Speaker, in mentioning that -matter in this debate.

Mr DEPUTY SPEAKER:

– I shall call the honorable member to order if he transgresses.

Mr DUTHIE:

– I think that about -X500,000 a year is allocated to the Road ^Safety Council from the receipts from the petrol tax. That body is doing a remarkably good job throughout the Commonwealth. It has provided ito schools in Tasmania recordings of some of its broadcasts of the series entitled “ Death is so permanent “. Those recordings are provided to schools 4he headmasters of which are interested in inculcating the principles of road safety in their pupils, and they are played over the amplifying systems at the schools. I was able to obtain- five recordings for one of the schools in my electorate, and I commend that idea to other honorable members because it will assist progressively minded headmasters, who desire to teach their pupils the dangers that exist on our roads. There is, however, one aspect of the Road Safety Council’s broadcasts that I do not like. I consider that some of the broadcasts are too realistic. In one broadcast that I have heard, the announcer says, after the re-enactment of a road accident, “ Ashes to ashes, dust to dust “.

Mr Holt:

– If the socialists do not get you, the Communists must!

Mr DUTHIE:

– When I was a minister of religion I conducted hundreds of funeral services, and I consider that that is too realistic a touch. There are many ways in which the necessity for exercising care on the roads can be impressed upon people without reading a portion of the burial service in such a broadcast.

Mr Pollard:

– It makes the listeners think.

Mr DUTHIE:

– Of course it does. But people hear that passage many times at gravesides when their own relatives are being buried, and I do not think that it is in good taste to include it in a broadcast. Most of the broadcasts, however, are excellently presented, and portray in an effective manner the terrific dangers of traffic, and the fact that a mistake may lead to death. I commend this bill wholeheartedly. It will ensure appreciable progress in the road programmes of the municipalities.

Mr ADERMANN:
Maranoa

– This bill, which seeks to amend the original law that provides for the allocation of money from the revenue raised by the petrol tax for road works, represents an improvement on the amounts that have been allocated in earlier years, and I wholeheartedly welcome it. The Commonwealth Aid Roads and Works Act, as has been mentioned by the honorable member for Corangamite (Mr. McDonald), was enacted for the purpose of assisting in the construction of roads throughout the Commonwealth from revenue derived from the petrol tax. The grants were not increased to any substantial degree during the war period, but since the end of the war increased grants have been made, particularly for the construction of roads in sparsely populated areas. Some time ago I placed on the notice-paper a series of questions relating to the allocations of the road grant to the various States, particularly to local-governing authorities in Queensland. In his reply the Minister for Transport (Mr. Ward) furnished very full information on the subject. Out of each £1,000,000 allotted for road works in sparsely populated areas Queensland received £191,000. I assume that allocations are still made on a population plus area basis as in earlier years.

Mr McDonald:

– Queensland receives a larger grant than does Victoria.

Mr ADERMANN:

– I am well aware of that.

Mr Scully:

– There are no sparsely populated districts in Victoria.

Mr ADERMANN:

– That is so. Two shires in my electorate have a total area equal to that of the whole of Victoria.

Mr McDonald:

– The honorable member appreciates the fact that Victorians are providing money for road works in Queensland ?

Mr ADERMANN:

– I am glad that they help to improve roads throughout the Commonwealth as a whole. The honorable member for Wilmot (Mr. Duthie) has referred to sparsely populated districts in Tasmania. I have not yet visited that State and accordingly I do not know a great deal about it. I know, however, that its area is not nearly equal to that of one of the largest shires in Queensland. I make no complaint about the allocation of moneys from the petrol tax to the localgoverning authorities in Queensland. Although they did not share in the allocation of . the first £1,000,000 that was provided for road works in sparsely populated areas, they shared in the second allocation. Bridges are one of the most vital needs in the sparsely populated districts of Queensland. In times of flood outback residents are frequently isolated from the towns. On two or three occasions during the last eighteen months many settlers in western Queensland were isolated because of flood conditions, and the Royal Australian Air Force had to be utilized to drop food to them. I appeal to the Minister to grant additional assistance to local governing bodies for the construction of bridges. I have asked the Minister whether the £3S2,000 which was made available to the Queensland Government out of the grant of £2,000,000 for road works in sparsely populated areas had been fully expended. In his reply, the Minister assured me that the money had been made available to the State government, but he could not give me any information in regard to its expenditure. He said, quite rightly, that his authority ended when the money was paid to the State government. I fear that the Queensland Government is not expending money on road works from its own collections of motor registration fees to the same degree as it would if these grants were not made. If that be so, the people are not receiving the benefits which they should obtain from these grants. That, how.ever is a matter which will be taken up in the State sphere. The grants to local governing authorities in the electorates represented by the Minister for the Navy (Mr. Riordan) and myself are much too small to enable them to undertake the heavy programme of road works which needs to be completed. I press for a larger allocation of the receipts from petrol tax for expenditure on roads works. We shall have something to say on that matter when the bill for the encouragement of meat production is under discussion. I express the hope that the Government which is in office next year, irrespective of ite political colour, will greatly increase the grants for road purposes from the revenue derived from the petrol tax.

Mr LANGTRY:
Riverina

.- I express appreciation of the decision of the Minister for Transport (Mr. Ward) and of the Government to increase the grants for the construction of roads in sparsely populated areas from the revenue raised by means of the petrol tax. I agree with the honorable member for Corangamite (Mr. McDonald) that the total amount provided for this purpose is insufficient, hut I remind him that it represents a big improvement on the amounts previously allocated. In my electorate an amount of £67,000 has been made available for road construction and maintenance.. The cost of road maintenance depends not so much on the length of road as on the volume of traffic which USes the road. During the wet winters that we have experienced in the last two years much distress has been caused to outback people because of the absence of good roads. Only country people can appreciate the value of good roads. City and town dwellers have no idea of the difficulties that country people have to overcome because of poor road facilities. Some of the roads in our sparsely populated areas are almost impassable in wet weather. The allocation of an additional £1,000,000 for the repair and maintenance of roads in outback areas will go a long way towards improving the present position. Having regard to the existing scarcity of labour and materials the road authorities probably would not be able to utilize larger grants. I agree with the honorable member for Maranoa (Mr. Adermann) that something should be done to increase the allocation to those localgoverning authorities in Queensland and in the western parts of New South Wales that have very large areas under their control. It can be truly said that good roads shorten the miles. I trust that the additional grant to be made available under this bill will enable the local governing authorities to improve their roads to a standard equal to that in the town areas.

Mr BERNARD CORSER:
Wide Bay

– I am not quite happy about the claim of the Minister for Transport (Mr. Ward) that this proposal to make available an additional £1.000,000 for the construction of roads in sparsely settled areas is evidence of the Government’s recognition of the conditions and difficulties that are faced by people who live away from the capital cities and the big towns. Having regard to the .vast sums that are collected from the people by way of the petrol tax, the total grant of £5,000,000 for the construction and maintenance of main roads falls far short of requirements. The Minister has said that the additional £1,000,000 to be provided under this bill for road works in sparsely populated areas will bring the total assistance granted by the Government for road construction in outback areas in the current financial year to £3,000,000. In the Wide Bay electorate there are sparsely populated areas as well as areas of close settlement, but almost the whole of the expenditure on road construction and maintenance in the electorate has to be met by the ratepayers. The system under which local-governing bodies operate has not changed greatly in the last 50 years. The grants to local-governing bodies for road purposes represents but a mere fraction of the total proceeds of the levy imposed on petrol users. Responsibility for the construction and maintenance of roads in sparsely populated areas should not be borne almost solely by localgoverning bodies. The additional grant proposed under this bill will do very little to lighten the burden placed upon them. Rural and agricultural areas will not benefit from the provisions of this bill. The whole of the additional grant to be made available is to be expended in isolated areas. It is the responsibility of the Government and not principally of the people in the cities and the coastal areas to provide the funds necessary to construct and maintain roads in outback areas. Approximately threeeights of the total moneys made available by the Commonwealth for road purposes will in future be expended in sparsely populated areas. Thus, a substantial portion of the moneys made available from the proceeds of the petrol tax will not directly benefit the majority of road users. This additional grant will do nothing to assist the thousands of primary producers who live in closely settled areas but are frequently isolated from nearby towns because in adverse weather conditions many country roads are not trafficable. One half of the total grant made available by the Commonwealth for road purposes is used for the construction of roads of strategic defence importance. The Government should make a special appropriation of money for the construction of strategic roads. Why should road users in the capital cities and farmers and settlers in rural areas have to provide the bulk of the money required for the construction of defence roads? Those who live hi outback areas should be given son * compensation to offset the disadvantage of isolation. A special grant, as distinct from the normal road grant, should be made for the construction of roads in those areas. The users of roads in the cities and in closely settled areas will in future be robbed of £3,000,000 per annum if this bill is approved by the Parliament. We should devise a new method for financing road construction throughout the Commonwealth. The old idea that it is the responsibility of local-governing authorities to finance roads within their areas, with but slight assistance from the proceeds of the petrol tax, must be abandoned. When the principal act was under consideration I urged that grants, be made from the proceeds of the petrol tax for the construction of jetties and boat havens in order to assist the fishing industry. The Government adopted my suggestion. I fear, however, that many local-governing authorities are not aware that money is available for that purpose. I should like to know how much has been expended on the provision of facilities of that kind. The Minister for Transport is, I am sure, anxious to do everything possible to improve the means of transport within the Commonwealth. Because many local-governing authorities are carrying burdens which it is almost impossible for them to bear, I ask the Minister to give further consideration to their claims for additional grants. I urge the Government to consider the desirability of allocating, from the revenue that is derived from the petrol tax, more money for expenditure upon roads in the thickly populated areas. I consider that the Commonwealth should accept responsibility for the construction and maintenance of roads in isolated areas and that roads that are constructed for defence purposes should be financed from the defence vote and not from petrol tax revenue.

Mr McLEOD:
Wannon

.- I commend the Government for its proposal to make available an additional £1,000,000 for expenditure upon roads in sparsely populated areas. The honorable member for Wide Bay (Mr. Bernard Corser) did not state the position correctly when he said that the Commonwealth contributes only £5,000,000 a year for the maintenance and construction of roads. During the last twelve months certain persons and organizations have been guilty of a great deal of misrepresentation in regard to this matter. The fact is that in this connexion the Government has acted more generously than did its predecessors. In the year 1939-40 the gross revenue from customs duties and excise duties on petrol was £12,335,092. In that year, the payments by the Commonwealth to the States under the Federal Aid Roads and Works Agreement 1937 amounted to £4,456,000, or approximately onethird of the total revenue from customs and excise duties. At the present time the . annual revenue from customs and excise duties on petrol is approximately £17,000,000 and over £S, 500,000 a year is being made available to the States in respect of roads.

Mr Bernard Corser:

– But only £5,000,000 of that sum is allocated for expenditure upon what I may call general roads. The remainder is for expenditure upon roads in isolated areas.

Mr McLEOD:

– The petrol tax was; levied originally as a means of raising; revenue. It was not intended at first that: the revenue derived from it should be devoted to the construction and maintenance of roads, but as time went on a proportion of the revenue from the taxwas diverted to the States for that purpose and was allocated among the municipalities and shires by State instrumentalities. It was agreed that a percentageof the revenue from the tax should bepaid to the States; no sum was specified. Two years ago, this Government introduced the first of the bills under which each year money is made available for the specific purpose of being expended upon the construction and maintenance of roads in sparsely populated districts. That is in addition to the annual allocation to the States to which I have already referred. It is not intended to be expended upon the speedways that are the main highways. The cost of maintaining such roads is defrayed from the proportion of the proceeds of the petrol tax that is made available to the States each year. It has been said repeatedly that our main roads are not so adequate or in so good a state of repair as they should be because this Government has starved the States of revenue, but the truth is that the States have not expended the whole of the money that has been allocated to them for road construction and maintenance.

I am of the opinion that even if the whole of the revenue from the petrol tax were paid to the States by the Commonwealth, it would not be sufficient, under the present system, to enable existing roads to be. maintained properly and new roads constructed. Road construction and .maintenance will present an urgent problem within a comparatively short time. More and more areas are being developed, and the roads are being used by very heavy vehicles. The light vehicles that were in use twenty years ago did not damage the roads to the same degree as modern vehicles damage them. Modern roads must be solidly constructed, and that involves the use of expensive machinery and equipment. I consider that the Commonwealth and the States would do well to try to reach agreement regarding the means by which road construction and maintenance could be undertaken on a large scale, using modern equipment that the municipalities individually cannot afford at present.

Mr Turnbull:

– They cannot get the necessary money.

Mr McLEOD:

– The States have not expended the whole of the money that has been made available to them. The honorable member for Wimmera (Mr. Turnbull) apparently knows very little about this matter. The Commonwealth has been criticized for diverting to Consolidated Revenue a portion of the revenue that is derived from the petrol tax. Any one who has listened to the speeches that have been delivered in this chamber by honorable gentlemen opposite, especially those who belong to the Country party, would probably assume that the State governments expend upon roads the whole of the revenue that they derive from vehicle licence-fees, but the truth of the matter is that this year the Victorian Government will pay into the Consolidated Revenue of the State £100,000 of the revenue from that source. In support of that statement, I quote the following extract from an article that appeared in the Melbourne Age -

Last year the increased Transport Regulation Board licence fees yielded £73,000, of which more than £05,000 was paid into the Consolidated Revenue of the State. It was not spent on road construction or maintenance. The sum so diverted this year is likely to exceed £100,000. Motor registration fees throughout the years have paid for construction and maintenance work under the Victorian Country Roads Board. Shire and municipal rates have also contributed to this end.

There is no evidence that our roads are in their present state of disrepair because of lack of funds. The cause of the trouble is the shortage of labour and materials, and probably of modern roadmaking equipment. Modern roads must be sealed, and that cannot be done on a large scale without proper equipment. It is probably beyond the capacity of the States to undertake such a task, and I consider that the Commonwealth and the States should confer in an attempt to devise a comprehensive plan. If road construction and maintenance on a large scale were undertaken by an authority that had at its disposal adequate plant and equipment, much of the money that is at present being expended upon road maintenance would be saved, because the authority would build roads that would last.

Mr RYAN:
Flinders

.- Having listened to the arguments that have been advanced by honorable gentlemen opposite, it is easy to understand why so little money has been forthcoming for roads. The honorable member for Wannon (Mr. McLeod) spoke of misrepresentation. If there has been any misrepresentation, it has emanated from Government circles. The statements that have been made by honorable gentlemen opposite who have spoken in this debate are as far from representing the facts of the case as anything could be. The honorable member for Wannon said that this Government has acted more generously than have previous governments. I agree with the honorable gentleman that it has done so, but I point out that there is now more money available than was available in the past. I point out also that the need for road construction and maintenance in this country is greater now than it has ever been. The sum that is to be made available this year for expenditure upon the most used roads in the Commonwealth is £5,000,000. .Similar amounts were made available annually two, three and four years ago. The only additional money that is now being allocated by the Government is £3,000,000 for expenditure upon roads in sparsely populated areas. Doubtless, that is a wise provision, but it will not assist those who are responsible for the maintenance of the roads in the more thickly populated areas. It is known to any one who has studied this matter that our roads are now being used to a much greater degree than ever before in the history of Australia. They are carrying more traffic, and that traffic is composed largely of heavy vehicles. Any one who has seen big trucks travelling along our roads at speeds that seem to me to be much too great to be safe realizes that the wear and tear on the roads is much greater now than it was in the past. As a result, the cost of maintaining them is greater than it was formerly. In addition, the cost of labour and materials has risen, and there is a back-log of repairs that have not been done since the end of the war, largely because insufficient money has been available.

Government supporters have repeatedly stated in this chamber that the Commonwealth does not propose to make more money available to the States for expenditure upon roads because the whole of thu money that has been made available for that purpose has not been used. That ii completely untrue as far as my electorate is concerned, and I believe it to be completely untrue of the greater portion of Victoria. On page 3 of a memorandum that has been prepared by the Australian Council of Local Government Associations, the following passage appears under the heading: “ Capacity of Local Government authorities to usefully expend a greater amount than has been made available in recent years “ : -

The war years’ reserve has now been practically extinguished, leaving only the current year’s revenue for expenditure during the present financial year.

Recently the Victorian Government, in order to expand road services and, in certain instances, to undertake the maintenance and repair of roads in Victoria, raised a loan of £5,000,000. Surely a Government would not raise a loan for that purpose if it already had money available for it. In those circumstances, T should like to hear how the Minister for Transport (Mr. Ward) can support the argument that he and other honorable gentlemen opposite have used that the’ States have not expended the whole of the money that has been made available to them for expenditure upon roads and, therefore, that no further money is required for that purpose. I know something about shire accounts. I know that between 50 per cent, and 60 per Rent. of the total revenue of a country shire is expended upon roads. I know of shire councils that are crying out for money for road maintenance, but they cannot get it. Money for the maintenance of roads should come from revenue and not from loan funds. Therefore, I ask the Government to re-examine that matter at some future date, if, perchance, it is still in office, with a view to improving the existing arrangement.

J/r. Ryan.

This important problem involves, not only roads, but also the vehicles that use them year after year. We are becoming more and more dependent on road transport. Heavy goods, light goods and food are being carried over roads to an everincreasing degree. If we are to have a satisfactory economic system, we must have good roads ; but we cannot have good roads without incurring expenditure on constructing and maintaining them. The problem must be tackled soon. I make a plea for a wider appreciation of the real problems of our roads. The grant that is authorized by this bill will be expended in the sparsely populated areas, and not in those parts of the Commonwealth where road traffic is heaviest. I agree that it is proper that the remote areas should be developed by the provision of- good roads, and I have no objection to that construction programme, but at the same time we must ensure that the road systems that carry the heaviest traffic shall be placed in satisfactory order. I hope that the Government will adopt the suggestions that have been made by the Opposition parties in this debate.

Mr LANG:
Reid

.- The Minister for Transport (Mr. Ward) gave a most interesting account of the history of the Commonwealth’s contribution to the construction and maintenance of roads. He told us how much money had been granted to the States and local-governing bodies; but the Prime Minister (Mr. Chifley) informed us that because of the lack of labour and machinery a large percentage of the money that was provided in previous years had not been expended. Honorable members should satisfy themselves that Commonwealth grants in aid of roads are utilized to the greatest advantage and that the amount bears a true relation to the receipts from the petrol tax. We should also satisfy ourselves that the States are being given a fair deal in the distribution of the money. The Minister referred to this grant as “ Commonwealth aid to the States “. In the current financial year, Commonwealth aid to the States for roads will amount to £8,500,000, and, in addition, £500,000 will be allocated for strategic roads and the construction of roads to Commonwealth properties.

The problem of the financial relations between the Commonwealth and the States is becoming most serious. The States object to the Commonwealth’s handouts because, as self-governing bodies, they should retain their sovereign right to levy taxes. The position is now more serious than it was at the time of the last conference of Commonwealth and State Ministers. The devaluation of the currency must have an injurious* effect on State finances, and increase the cost of road-making machinery. The Commonwealth is the tax-collecting authority, and the States are the expending authorities. The Commonwealth collects the revenue for the purposes of roads from a sectional tax. Obviously, the petrol tax of 10-Jd. a gallon is a levy on motorists, and it is imposed on every gallon of petrol that is used throughout Australia. Last year, the petrol tax yielded £17,498,000, and that money should have been paid into a trust fund and expended for purposes directly connected with roads. If the Government believes that all the revenue that it collects from the petrol tax cannot be expended on the construction and maintenance of roads, it should reduce the tax immediately. Last year, the Government expended only £7,630,000 on roads, and this year it proposes to grant to the States for the purposes of roads a total of £9,000,000. When that sum has been distributed, the Commonwealth will have a surplus of £8,000,000, which, in effect, it will withhold from the States. Last year the surplus was £10,000,000.

Since 1926, the Commonwealth has raised £181,500,000 from the petrol tax, and has distributed only £64,500,000 to the .States. In other words, the Commonwealth has retained £117,000,000 for its own purposes. The whole of that money was provided by the motoring community from this sectional tax, but Consolidated Revenue has reaped a benefit from it. Therefore, when the Minister and other honorable members refer to “ Commonwealth aid to the States “, they make a false claim. The petrol tax in ay be described as the “motorists’ aid to the Commonwealth “. The Premier of “New South Wales, Mr. McGirr, is most incensed over the raw deal that that. State has received from the Common wealth, and this bill will not salve his feelings. Last year, consumers of petrol in New South Wales paid to the Commonwealth an amount of £5,904,000. Of that sum only £2,000,000 was returned to New South Wales for the maintenance of roads. The balance of £3,000,000 was diverted to the Commonwealth Treasury. In that respect, New South Wales was much worse off than any other State.

Mr Ryan:

– Except Victoria.

Mr LANG:

– No; New South Wales was worse off than any other State. This bill authorizes special grants for the construction of roads in sparsely populated areas. The formula that governs the distribution of the money among the States has not been observed in this and similar measures. The basis of distribution is supposed to be the greatest need. Why should the Commonwealth restrict the grants for special purposes to sparsely populated areas? I point out that sparsely populated areas are not necessarily those that are in the greatest need of financial assistance for the construction and maintenance of roads. The Minister admitted that he was most concerned because many of the localgoverning authorities to which grants had been made had not expended the money. He mentioned that in some States difficulty had been experienced in obtaining road-making plant. This bill will not assist to overcome that difficulty. Why should the grant be restricted to sparsely populated areas? Motorists who reside in the County of Cumberland, that is, the City of Sydney, contribute more to the Treasury, through the medium of the petrol tax, than does any other group of consumers, but they receive the least return. Approximately one-half of the motor vehicles in. New South Wales are owned by persons who reside in the city areas of Sydney. Many vehicles from the city use country roads, and vice versa, but this bill should not be exclusive, or discriminatory. City motorists are entitled to the same consideration as country motorists receive. Last year, Sydney motorists paid £3,000,000 in petrol ‘tax. ‘ How much of that amount was expended on the construction and maintenance of roads in the city area? On a pro rata basis, an amount of £1,900,000 was retained by Consolidated Revenue. On the basis of actual expenditure on main roads in the metropolitan area, Sydney motorists had an even smaller return. They also contribute one-half of the receipts from the tax that is levied by the Department of Main Roads for the registration of motor vehicles.

The principle of this bill is that the money shall be distributed, not on the basis of population, but on the basis of area. In my opinion, that principle is wrong. There is a simple way in which the Minister may amend the bill, and, by go doing, grant urgently needed aid to the long-suffering motorists of Sydney. The amendment would not require a great readjustment of Commonwealth expenditure and would ensure that those who contribute the major part of the receipts from the petrol tax should receive more equitable treatment. We have an opportunity to make a major contribution towards assisting this country to solve its petrol consumption problem, reduce dollar expenditure that is incurred on the maintenance of motor vehicles, and avoid the waste of valuable man hours.

I refer to the problem of the Sydney Harbour Bridge. Last year 9,791,000 vehicles crossed that bridge, and some 15,000,000 people travelled over it by omnibus. Because of existing conditions, a major traffic bottleneck has developed, and I have no hesitation in describing it as the most serious in Australia. As the result of that bottleneck, there is a huge waste of petrol. At the peak hours a motor vehicle may take twenty minutes to cross the Harbour Bridge.

Sitting suspended from 6 to 8 p.m>

Mr LANG:

– A conservative estimate is that 350,000 gallons of petrol are being wasted each year by these hold-ups. That, on the Treasurer’s reasoning, imposes a heavy burden on his dollar resources. In addition, huge wastage is caused by unnecessary strain and wear of running equipment. Most vehicles cross the bridge in second gear. Brakes are used all of the way, involving wear and tear. How are we going to obtain replacement of parts for American-manufactured vehicles without involving a further drain on dollars ? There is also a huge waste of man-hours. Distribution of goods is delayed, production is slowed down, and costs are increased. Leisure time is lost.

The State Government is not at present in a position to do anything about the matter. This bill creates a precedent by providing for the giving of assistance on a sectional basis. It provides for assistance to sparsely populated areas. It should be extended to include assistance for people in the most densely populated area in the Commonwealth. The Sydney Harbour Bridge is part and parcel of the main roads system of New South Wales. Its original cost was just over £8,000,000, of which £7,500,000 is still owing. I am not suggesting that the Commonwealth should repay the entire capital debt, although the Minister might well agree with such a course of action, since it would mean only the retirement of some of our London sterling reserves, at present frozen. We are paying interest on that £7,500,000 in London, but not drawing comparable interest on the £450,000,000 we have tied up in London.

The Government of New South Wales is paying over 3 per cent, interest on the cost of the harbour bridge. In addition, since the bridge was built, it has had to pay an unexpected 25 per cent, exchange on all interest payments. Since 1932, it has paid more than £500,000 in exchange. Interest, exchange, and sinking fund payments for the bridge are at present costing £350,000 a year. Maintenance costs just over £60,000 annually. The amount collected in tolls last year was £3S0,795. The rest of the’ income for the bridge account came mostly from contributions made by the various transport departments because of increased fares on trains, trams and buses. Thus, it would cost the Australian Government only £400,000 a year to take over the entire liability for the bridge. It would be a sound economic proposition from a national point of view. The amount involved would be a very small contribution from the total amount of revenue contributed by the motor vehicle owners of the Sydney metropolitan area. It would be less than one-fifth of the amount being diverted to Consolidated Revenue from this special sectional tax. It would enable the Government of New South Wales to wipe out the bridge toll immediately. That, in turn, would save the Commonwealth whatever dollar drain it claims to exist on the importation of 350,000 gallons of petrol a year. Abolition of the toll would mean a saving of 10,000,000 hours a year. That would assist production. It would increase national income and reduce costs. Those are all very desirable objectives, as the Minister will agree.

More and more vehicles are using the bridge every day. Unless this Government helps to solve the problem, there will be a serious breakdown in transport. Already, there is an agitation for an additional bridge as the only permanent solution. Such a bridge could be built only if this Government agreed to undertake the capital expenditure. Immediate relief could be given by abolishing the toll. The revenue thus lost could be made up from the proceeds of the petrol tax. I ask that the Minister give the problem, his personal consideration. A Labour government built the bridge, and a Labour government should now see to it that the toll barriers are removed for all. users of the bridge.

Sir EARLE PAGE:
Cowper

– The Federal Aid Roads scheme, to which this bill refers, has been described by Mr. Kemp, Co-ordinator-General of “Works in Queensland, and previously Deputy Controller for the Allied Works Council, as the greatest national work ever attempted in Australia. Under this scheme, more money will be expended than under the Snowy Mountains scheme. Up to the present, £150,000,000 has been expended under the Federal Aid Roads Agreement, and it is expected that during the next twenty years, an additional £150,000,000 will be expended, making a total of £300,000,000.

Every one will agree that the money has been well spent, both in war-time and in peace-time. The organization evolved for carrying out the scheme was responsible for the construction of great highways from Birdum to Alice Springs, and from Western Australia to Queensland. It was also responsible for the construction of aerodromes in various parts of Australia, including those used by the aircraft that defeated the Japanese in the Coral Sea battle, and thus prevented the invasion of Australia. During the war the same organization supplied skilled executives and workmen for the construction of roads and other important public works and it has continued to do so since the cessation of hostilities.

The scheme has been in existence since 1926, when it was inaugurated by the Bruce-Page Government. The original period envisaged was ten years. In 1937, it was renewed for another ten years, and in 1946 it was again renewed for three years. Tremendous quantities of heavy machinery have been obtained for the making and maintenance of roads. It is not often that I am able to agree with the Minister for Transport (Mr. Ward), but I am compelled to admit that he has proved himself an energetic and capable administrator. It is necessary for us to review the past in order to understand the situation that exists at present. The cost of labour and machinery to-day is such that the amount that was sufficient to handle the road problem ten or twenty years ago is not nearly sufficient to-day. The basic wage to-day is about £6 12s. compared with £3 19s. in 1939. The additional cost to the Nambucca Shire caused by the increase of .the ‘basic wage is about £6,400. Extra labour or overtime needed because of the 40-hour week’ has added about £1,000 to its costs. The shire’s labour costs have risen by 75 per cent. That is typical of all shires, and what has happened to them has equally happened to the main roads authorities. Road traffic has increased enormously since before .the war. More motor trucks and motor cars are on the roads. The trucks are heavier and they carry vastly bigger loads. About 78,000 motor lorries were registered in New South Wales in 1939, compared with about 139,000 registered on the 30th June, 1949. That is an increase of about 80 per cent. With 80 per cent, more traffic on the roads and labour costs 11T 75 per cent, the cost of building roads has risen by 150 or 160 per cent. I have said that motor trucks to-day carry vastly greater loads. Timber trucks that, before the war, carried loads of only 5, 6 or 10 tons now carry 30 tons. The system of dealing with the products of the country has also greatly altered. Ten years ago, the great bulk of the milk produced in Australia, especially in the coastal areas, was converted into butter.

Cream was carried from the dairy farms to the putter factories three or four times a week in hot weather and about twice a week in the winter. Nowadays, nearly all the milk is picked up at the farms once or twice daily. That which is not drunk by the people is taken to factories for conversion into milk products. Two gallons of milk is needed to make 1 lb. of butter, and a gallon of milk weighs 10 lb. Milk waggons carry 20 lb. to-day for every 1 lb. they carried previously. The milk has to be picked up, wet or fine, because milk must be quickly refrigerated and pasteurized, whereas cream can be kept on the farm and does not need to bo picked up so often. So the position to-day differs in three ways from the position before the war. The cost of building and maintaining roads has greatly increased, traffic has tremendously increased and loads carried have increased. There has also been a great increase of revenue from the petrol tax, in the Commonwealth sphere, and from motor registration fees, in the State sphere. Some of the revenue from registration fees, of course, is spent on road work.

The problem that we have to face to-day is entirely new. Heavy .trucks are using roads and by-roads that they never used before. During the war, when timber was required urgently for war purposes, roads were .bulldozed into virgin forests. So great is the damage that has been caused to roads by heavy vehicles that practically every shire has become bankrupt in trying to meet the position. Offset against all that is the fact that, this year, an additional £1,000,000 is to be allocated for the construction and maintenance of roads in sparsely settled areas, making the total £3,000,000. I think that the Department of Transport should be entrusted with a substantial part of the War Damage Fund for distribution to local governing bodies to enable them to repair the roads that were damaged during the war. The heavy road machinery of the shires was impressed for military purposes during the war. That destroyed the possibility of keeping the roads in repair, and, at the same time, the roads were used much more heavily than was previously the case. The coastal cargo boats that used to carry timber and produce became mine-sweepers. Products that used to be shipped from the coastal ports had to be sent miles overland to the railways. Enormous loads were carried over the roads. Consequently roads that were good ten, or even five years ago, are now breaking up. Even main road surfaces are integrating. That applies not only to the shires but also to the municipalities. Casino is the centre of a huge timber industry and there are many timber mills in the neighbourhood. It is also an important railway junction. During the war, big military camps were established in the district, and all the petrol for the Evans Head aerodrome, from which flew the reconnaissance aircraft that kept track of enemy submarines and used millions of gallons of petrol, had to be carted from the town to the aerodrome. Members of the Casino Municipal Council have told the Government that the cost of repairing the war damage to their roads amounts to £2,575. Patriotically, they said to the Government, “If you find £1,000, we will get the other £1,575 from the ratepayers “. The military authorities recommended that the Commonwealth provide £980 in compensation. Now the Treasury wants the council to accept £248. The problem of war-time damage to roads should not be the subject of argument between the Prime Minister and the State governments. It should be handed to the Department of Transport for investigation and report. That department should establish exactly what should be made available for the repair of war-time damage to roads and distribute accordingly funds entrusted to it for the purpose. In addition to the allocation of money for main road purposes, from the proceeds of the petrol tax, a further allocation should be made to assist the shires to keep their roads in reasonable condition.

The basis of the present modified system of assisting the States to maintain roads was laid by the Bruce-Page Government. Our experience, which is borne out by world experience, was that for every twopence spent on roads we got. f fourpence in return in the saving of wearandtear on tyres and motor vehicles. 1 was sent to the United States of America to investigate its main road system, so 1 know that what I say is true. An important aspect to be considered is the saving of wear-and-tear on human beings. The man who drives over good roads arrives home not half so irritable as does the man who is forced to drive over bad ones. More man-hours can be got out of people who have good roads to use. I do not like talking in terms of man-hours, because I regard people as human beings rather than as cogs in a machine. What I impress upon the Government is the need for a long-range plan. Under the present system, the roads grant is renewable, at the will of the Commonwealth Parliament, every year, but, when we instituted the system, we established a ten-year plan. Aware that they had an assured income from the Commonwealth for ten years, the road authorities were encouraged to buy heavy machines. More important than that is the fact that men who worked on main roads felt that they had almost a lifetime job and were encouraged accordingly. Ordinary workmen became skilled workmen who took a pleasure in their work. The Minister for Transport will agree that under a longrange plan the road authorities .and the workers know where they stand. The authorities can go ahead and buy heavy machinery. In fact, I think that the terms that they would get from the manufacturers of such machinery would be better if there was a scheme of this sort in existence than they would be otherwise. Therefore I shall vote for the allocation of £1,000,000, or as much more as the Government is willing to grant for work on roads, because I consider that roads are one of the most important methods of communication over long distances in this country.

A large section of the population lives adjacent to railways and is able to use that means of communication for the transport of products and for travelling in connexion with business or pleasure. Surely people who do not live near a railway line are just as entitled to rapid means of communication by the medium of good roads. Without railways we should not have achieved our present degree of settlement, and we shall not be able to increase settlement in country areas unless we increase road facilities. Only by the provision of good roads can we keep in rural areas the people who are already there and also attract more people to those areas. The lack of roads in many areas has an effect upon the cost of living, in that the difficulties of transporting primary products to market adds to the price that is charged to the public. By providing easier access to markets for primary products we shall assist to keep down prices, because there is no doubt that the disparity ‘between the prices for primary products that are paid to the producer, and the prices that are paid by the public to the retailer, is to a large degree the result of high transport charges. Quite naturally if it costs two or three times as much as it would cost to transport goods to market the price to the consumer will rise commensurately. That is why I shall vote quite cheerfully for the increase by £1,000,000 of the allocation this year, and would vote even more cheerfully for an increase of £5,000,000, a sum which I think is absolutely indispensable at the present time for the purposes of road works. I consider that £5,000,000 for this purpose should come out of the War Damage Fund because, after all, the conditions that have developed are a result of the recent war. I also consider that our road maintenance and development policy should be based on a ten-year period and not on a period of one year.

Only recently there were very serious floods in the rivers in the northern part of New South Wales, and there are also frequently very bad floods in Queensland and in other States. At the present time in Kempsey, which was badly hit during the recent floods in New South Wales, one can see roads and gardens cluttered up with silt. The honorable member for Capricornia (Mr. Davidson) who recently visited that area with a party that was investigating the conditions that resulted from the floods, said to me, “ What is really needed is for the local authorities to be given a free loan of earth-moving machinery from the Army to deal with problems such as this “. We need some special organization which would have the technical men and the machinery available for the work of clearing away thu results of the floods and they should be given the opportunity to do that work. An area like the Macleay district .would quickly become reproductive again and would help to develop the nation instead of dragging it down if working capital were available for such tasks.

It is most necessary to increase the quantity of fish available to the people of this country. Fish provides a pleasant change of diet, and if more fish were available to the people we should consume less meat and should therefore be able .to export more meat to Britain and so enable the Mother Country to reduce its dollar commitments to Argentina for meat from that country. More fish would come on to the market if there .were more boat havens along our coasts as bases for fishing fleets. There are innumerable places such as Woolgoolga, Coffs Harbour and Jamba where an expenditure of £10,000 or £15,000 would enable an efficient boat haven to be constructed, but which, in fact, cannot now be used by fishing fleets because of the state of the river bars.

Mr DEPUTY SPEAKER (Mr Clark:

– Order! The right honorable gentleman should keep his fish stories for some future occasion.

Sir EARLE PAGE:

– I conclude by repeating that we require an arrangement to cover a ten-year period and not just a proposal for one year, and that the vote should be increased !by at least £5,000,000 instead of by £1,000,000. We also need an organization to be utilized along the lines that I have suggested in order to be of real use to Australa.

Mr THOMPSON:
Hindmarsh

– It was refreshing to hear the right honorable member for Cowper (Sir Earle Page), who is a member of the Opposition, paying so much commendation to the Minister for Transport (Mr. Ward). We do not very often hear the Minister’s qualities recognized as they were recognized to-night by the right honorable member, and I am sure that it must indeed be very pleasant for the Minister to receive that commendation. This is only a short bill which proposes to increase by £1,000,000 the allocation from the petrol tax to the States for the purposes of work on roads, as well as for some of the work that the right honorable member for Cowper has mentioned, such ns that in connexion with boat harbours. I point out that the Commonwealth, in addition to the sum of £3,000,000 which it proposes to distributeto the States under this measure, will alsogrant the States a sum of £5,500,000 during this financial year for work on roads. The corresponding sum paid in 1939 was £3,000,000. I was rather amazed to hear the remarks of the honorable member for Reid (Mr. Lang). He took the opportunity to discuss at. length the revenues obtained from toll collections on the Sydney Harbour Bridge, the number of people who cross, that bridge, the amount of traffic using it, and the waste of petrol. It appeared to me that he did not deal at any great length with the wisdom or otherwise of the Government in making this sum available to the States under this legislation. I was also very surprised this afternoon by the attitude adopted by the honorable member for Wide Bay (Mr. Corser). Whilst I can understand the attitude of the honorable member for Reid,, it was strange to hear the honorable member for Wide Bay say that he objected to this money being spent on roads in sparsely settled areas. He contended that the money should be spent in areas from which the greater part of the revenue derived from taxation comes. That is surprising, because I understand that the honorable member is a member of the Australian Country party.

Mr Turnbull:

– And a good one !.

Mr THOMPSON:

– The honorable member for Wimmera (Mr. Turnbull) says that the honorable member for Wide Bay is a good member of the Australian Country party. I do not think we shall hear the honorable member for Wimmera objecting to this money being partly ear-marked for sparsely populated areas. I think that he would like some of it to be spent in the country areas of Victoria, in which State his electorate lies. I agree with other honorable members who have said that roads are an important means of transport in Australia. America and countries in Europe are proud of their great roads that run from one end of their territories to the other. The right honorable member for Cowper has mentioned the great increase of the carrying capacity of commercial motor vehicles. He especially mentioned timber loads, which have risen from S tons in previous years to 30 tons at the present time. Generally speaking, we have to get timber not in the thickly populated areas, but rather from where there are now no roads at all, and we should see that roads are provided to such areas. From time to time I have heard honorable members who represent rural electorates complaining about the difficulty that trucks laden with timber find in negotiating country where the roads are either bad or where there are no roads at all. I have been in areas where there were practically no roads and which were just, in effect, big pastoral holdings, where motor transport “had to pick its way in between gum trees in order to find a track. Any one who, year after year, has to use roads that are among the worst imaginable would appreciate the need for some special provision being made for road work in sparsely settled areas.

Opposition Members. - Hear, hear !

Mr THOMPSON:

– I am pleased to hear members of the Australian Country party saying, “ Hear, hear ! “ Those honorable members know the position as well as I do. I consider’ that if we want to make the best of this country we should develop our road services. I can recollect hearing speeches from the honorable member for the Northern Territory (Mr. Blain) and the honorable member for Indi (Mr. McEwen) on the necessity for building good roads into the outback. They referred especially to the Northern Territory and not so much to roads in the States, but the Northern Territory is, to a degree, in a similar position to the outback areas of the States. Those areas in the States have in a large measure been neglected as far as roads are concerned by their local-governing bodies just as the Northern Territory has been neglected as far as roads are concerned. An honorable member has-just interjected to say that I should not cast reflections upon local-governing bodies, because they are usually composed of landholders who naturally want to get as much money spent on roads as possible. That only supports my statement that sparsely settled districts have been neglected by the local-governing bodies which have concentrated on thickly settled areas.

We have been told that we should avoid centralization. The Government in its wisdom has decided to make this sum of money available to the States who know their own requirements for distribution to local-governing bodies. Yet we are being asked by honorable members opposite why we cannot make this money available direct to shires and other bodies. To do so would be, in fact, to adopt a policy of centralization and would be giving a dictatorship to Canberra, which would enable it to say in which shire the money was to be spent.

Mr McEwen:

– The policy of the honorable member’s party includes the abolition of the State governments.

Mr THOMPSON:

– I say to the honorable member who has just interjected that, while the States exist as they are, and while we have the Constitution as it now is, there is not much hope of abolishing the Sta tes. The honorable member knows that, and is just trying to draw a red herring across the trail. The Opposition often accuses this Government of trying to centralize everything in Canberra, and of trying to take away the rights of the States, yet in this instance, in which we have an example of decentralization of control, honorable members ask for centralization. They ask that we shall make this money available direct to local-government bodies. The Government is giving the responsibility for the distribution of the money to the States themselves.

Mr Turnbull:

– That is not right.

Mr THOMPSON:

– I do not know whether it is right or wrong. The honorable member is always telling me that I am wrong, but I think that I am right more often than he is. I have no doubt that he will follow me in the debate, because I know that he is greatly interested in this subject. I advocate the building of bigger and better roads. Unfortunately we have not yet got away from the ideas of the horseandbuggy days. Too many of our roads are too narrow to enable motor vehicles travelling in opposite directions to pass one another with adequate safety margins. We need more roads which are capable of carrying heavy traffic, so that road transport of our vastly increased production may be facilitated. I agree with the right honorable member for Cowper that if it possible to do so, we should make additional moneys available for road construction and maintenance purposes. However, I point out that the scarcity of labour and materials is so acute that it would be beyond the capacity of most local-governing bodies to undertake additional road works. Much has been said about the need to provide finance for home building purposes. Every honorable member is aware that sufficient money for home building purposes is available on the easiest of terms to absorb the whole of the available labour and building material. If the scarcity of labour and materials could be overcome, more homes and more roads could be built.

Mr ACTING DEPUTY SPEAKER:
Mr. Lazzarini

– Order! There is nothing in this bill about housing.

Mr THOMPSON:

– I am not talking about housing, nor am I talking about the Sydney Harbour Bridge. As in relation to housing, so also in relation to roads, the problem is to find labour and materials. Another matter which was raised by the right honorable member for Cowper, and to which I think some consideration should be given, is the desirability of making available a pool of roadmaking equipment. The type of roadmaking equipment that was used in the horse-and-buggy days is not suitable for modern requirements. Another matter that will have to be considered is the desirability of effecting amalgamations of the smaller shire councils and localgoverning bodies. Many small local authorities must either amalgamate with their neighbours or make an arrangement for the mutual sharing of heavy roadmaking equipment. Modern road-making equipment enables road construction work to be undertaken expeditiously and cheaply. The smaller local-governing bodies cannot secure such -equipment without financial assistance. I have seen road workers employed by many shire councils using little drays that do not hold much more than an ordinary wheelbarrow. The days when equipment of that kind could be used efficiently for road work have long past. Old-fashioned ideas about road construction and maintenance must be abandoned. I hope that the Minister, in his conferences with the representatives of the States, will be able to convince the States of the necessity for securing the closest co-operation between local-governing bodies in the purchase and utilization of efficient roadmaking plant. I have no desire to take up much more time.

Mr Beale:

– Hear, hear!

Mr THOMPSON:

– An honorable member has to be pretty good to beat the honorable member for Parramatta (Mr. Beale) in taking up the time of the House. In providing nearly £9,000,000 this year from the petrol tax for road works in the States, the Government has made a very excellent contribution towards the improvement of transport facilities in this country. Honorable members opposite have claimed that all of the proceeds of the petrol tax should1 be expended on road works; but if that were done, and the Government had to> increase other forms of taxation in orderto meet its commitments, honorable members opposite would immediately object.. It is the duty of the Government to ensure that the revenues collected from the people shall be expended to the advantage of the community as a whole. I trust that the additional £1,000,000 to be madeavailable under the measure will beutilized by the States during this financial’ year in the improvement of roads in. sparsely populated districts.

Mr FRANCIS:
Moreton

.- The. honorable member for Hindmarsh (Mr. Thompson) has said that local-governing authorities should construct more roads, than they have constructed in the past in sparsely populated areas. This bill has been introduced in order to enable them to do so. In the past, local-governing bodies have been unable to finance largeprogrammes of .road construction. They have appealed for assistance to this Government and the governments of theStates, and this bill has been introduced, because the case which they presented was unanswerable. Localgoverningauthorities have a difficult problem in. financing their works programmes. The honorable member for Hindmarsh has suggested that their difficulties might be overcome to some degree by a process of amalgamation and by the pooling of heavy road-making equipment. All of that has been done in Queensland, but the local-governing authorities of that State still have the greatest difficulty in making ends meet because of increased wages, the impact of the shorter working week and the steeply rising cost of materials. I. am glad that the Government has yielded to their representations and has made an additional grant available for Toad purposes. I agree with the right honorable member for Cowper (Sir Earle Page) that the allocation of moneys from the petrol tax for road purposes ia inadequate. A much more substantial proportion of the proceeds of the tax should be earmarked for road works. With the general principles underlying the main roads legislation I am fully in accord. This bill represents an enlargement of the general principles of that legislation. Since 1926 when this legislation was first introduced, more than £150,000,000 has been made available from the proceeds of the petrol tax for main road construction throughout Australia. I remember the circumstances that existed when the legislation was introduced in 1926. The gravel roads which predominated throughout the country were incapable of standing up to the wear and tear of motor traffic. In dry weather they were dusty, and in wet weather they were quagmires. Wear and tear on motor engines and tyres was very great before our main roads were sealed. The imposition of a tax on motor vehicle users represents a very efficient way in which *o finance road construction works. Since 1926 the saving to road users in motor tyres, parts and engine reconditioning has been very great.

An excellent job has been done by the officials of the road authorities throughout Australia. The very efficient organizations which they had developed were utilized to the fullest degree during the war years. Their highly killed engineers, technicians and workmen and their heavy equipment were used to construct strategic roads in the interior and in Queensland, and to construct aerodromes and airstrips, all of which played a very important part in the successful prosecution of the war. Australia is indebted to the road authorities and their staffs for their very fine war effort. The revenue derived from the petrol tax amounts to £18,000,000. Of that amount, £5,000,000 is granted to the States for main road works, £3,000,000 for road construction and maintenance in sparsely populated areas, making a total of £8,000,000, and £500,000 for defence roads, leaving approximately £10,00,000 for general revenue purposes. A great deal more money should be provided for the construction of roads in sparsely populated areas. The outback areas of this country will never be properly developed until we have provided good trafficable roads for those who settle there. This is not the age of the German wagon or of the slow moving truck. In these days greater quantities of products are transported to and from the markets by heavy motor trucks than ever before in our history. I hope that the Government will be able to see its way clear to increase tl], grant proposed in this bill and to stabilize the grant for a period of ten years as is done under the agreement with the States in relation to main roads. Road construction and maintenance costs are rising steeply. Wages have increased ; the working week has been shortened; materials are much dearer than they were in : lie past; and road-making plant and equipment is difficult to obtain. Because of those factors a larger grant should be made available for the construction of roads in outback areas not so much for the purpose of enabling local-governing bodies to undertake the construction of new roads as to meet the added costs which they have to bear. These added costs might well absorb the whole of this proposed addition -1 grant of £1,000,000. If new roads aru to be constructed the grant will have to be increased. To-day the roads are used by vehicles of substantially heavier weight than the roads were planned to carry. Throughout the whole of Australia to-day one sees trucks piled high with heavy merchandise or carrying heavy logs. The use of increasingly heavier motor vehicles is having a detrimental effect on road foundations which are not strong enough to bear such heavy traffic. During the war the haulage of heavy guns and .the use of the roads by heavy military tanks caused great damage’ to road foundations. For these reasons I agree with the right honorable member for Cowper that portion of the War Damage Fund should be utilized for the repair of roads which were badly damaged by heavy war-time traffic. Although millions of pounds were accumulated in the War Damage Fund during the war, fortunately this country did not suffer any substantial war damage. I suggest that some of the money that now stands to the credit of the fund should be expended upon roads. I realize that a large proportion of the fund will probably be used by the Government to meet its obligations to ex-servicemen in connexion with the payment of war gratuity, but when that obligation has been honoured the substantial sum of money that will still remain in the fund should, in my opinion, be expended upon the repair of roads that were virtually destroyed during the war.

The grants that are made to local authorities should not be made on a yeartoyear basis. Experience has shown that, under such a system, local authorities are unwilling to engage the large numbers of workmen and accumulate the great quantities of material and equipment that are necessary if road construction and maintenance is to be undertaken on an adequate scale. After representations had been made, the Commonwealth undertook to make money available to the States for this purpose for ten years. As a result, many men chose road construction and maintenance as their vocation and began to study the subject. If a promise is made that annual grants for expenditure upon roads in sparsely populated areas will be continued for ten years, local authorities will begin to gather together the personnel, materials and plant that are necessary for the work.

I commend the Government for its action in introducing this bill, but I appeal to the Minister to do what he can to ensure that the amount of the grant is increased substantially.

Mr TURNBULL:
Wimmera

.- The honorable member for Hindmarsh (Mr. Thompson) was right when he said that I would support this bill. I do so most wholeheartedly because I believe that more and more money should be made available for expenditure upon roads in isolated areas. We must keep separate in our minds the two grants that are made by the Commonwealth to the States in respect of roads, although they are both financed from revenue derived from the petrol tax. Perhaps I should qualify that statement. The revenue derived from the petrol tax is paid into Consolidated Revenue, and the grants to the States are made from Consolidated Revenue, but must be regarded as portion of the petrol tax. It is merely a technical point, but I make that qualification lest it should he said later that I have misrepresented the position. A sum of £3,000,000 is to be made available by the Commonwealth for expenditure upon roads in sparsely populated areas. That sum should not be confused with the money that is made available to the States for other road services. The honorable member for Hindmarsh was incorrect when he said that the sum of £3,000,000 in respect of roads in isolated areas will be paid to the State governments, that the State governments will make a proportion of that sum available to municipal bodies, and that those bodies will be allowed to expend the money as they think fit. The fact is that any proposal to expend money upon a road in an isolated area must be approved by the Minister for Transport. That was stated clearly in an answer to a question upon notice that was asked by the honorable member for Maranoa (Mr. Adermann). The answer leads as follows: -

Under the conditions of the Commonwealth Aid Roads and Works Acts Nos. 17 of 1947 and 91 of 1948, the Commonwealth does not require t]ie States to submit details of how funds made available to them under section (i (3) are expended, hut does require the details of proposed expenditure of funds made available under section (i (4), namely, for roads in sparsely .populated areas.

The two grants are quite different.

It has been estimated that the total amount of money that will be made available to the States in respect of roads during this year will be approximately £8,500,000. Of that amount, £3,000,000 will be used on roads in sparselypopulated areas. That means that approximately £5,500,000 will he available for expenditure upon other roads. I do not think that sufficient funds are being made available for road construction, reconstruction and maintenance. From the time of my election as a- member of the Parliament, I have constantly attempted to persuade the Government to make more money available for that purpose, but my efforts have not been attended with any great success. I am pleased that, under this bill, an additional £1,000,000 is to be made available for roads in sparsely populated areas. Whenever the Prime Minister (Mr. Chifley) or the Minister for Transport (Mr. Ward) are asked whether they are in favour of making larger sums of money available for road maintenance and construction, they mix up the two grants. The Prime Minister, for instance, will say, “ We made £1,000,000 available, and then another £1,000,000, and then a further £1,000,000 “, but the truth is that no substantial additional money has been made available for ordinary road construction and maintenance. It was stated in the answer to the question asked by the honorable member for Maranoa to which I. have referred that the total amount of money that was made available in 1946-47 for road construction under section 6 (3) of the acts was £4,S05,000 and that in 1948-49 it was £5,101,286. The increase was only a small one ; it did not amount to millions of pounds. Of course, additional money has been made available, but it has been made available only for sparsely populated areas and on the condition that the Minister for Transport shall be empowered to tell a shire council where it is to spend the money made available to it for roads. I believe that the members of shire councils are the best judges of where the money should be spent. I do not agree with the honorable member for Hindmarsh that all the members of shire councils live in closely populated areas. I know of shire councillors who have to travel 20 or 30 miles to attend council meetings. When they attend those meetings, they have a voice in the decisions that are made. I think that honorable members on both sides of the House will pay a tribute to the marvellous work that has been done by shire councillors throughout Australia both in war and peace. I believe that the Government could entrust to them the task of spending money that is made available for the construction and maintenance of roads in sparsely populated areas, knowing that it will be used in the best interest, not only of the shires concerned, but also of Australia generally. It is reasonable to argue that the members of a council or of a shire that is situated a great distance from Canberra, or Sydney, where the Minister’s electorate is located, and who have been sufficiently interested in local affairs to seek election to a shire council, with sufficient standing to have been elected by the people of that locality, will have a much better knowledge of the requirements of the area than has the Minister, who perhaps has never visited that part of the country and must act upon the advice of an official who may have paid only a hurried visit to it. In some instances application by shire councils to be allowed to expend money upon roads in certain districts must be accepted or rejected on the advice of officers who have no real knowledge of the situation.

Although the honorable member for Wilmot (Mr. Duthie) said that more money is required for road works, he expressed himself as being more or less in agreement with the bill and did not press that extra funds should be made available. On the 16th and 17th August, 1949, a conference of Commonwealth and State Ministers was held in Canberra. Mr. Fagan, the Deputy Premier of Tasmania at the time, said -

The payments now being made by theCommonwealth to the States under the terms of the Commonwealth Aid Roads and Works Act are quite insufficient to meet the State’s requirements for road construction, reconstruction and maintenance purposes.

Mr. Fagan is not a member of the Liberal party or the Australian Country party. He is a member of the Labour party.

Mr Edmonds:

– That is to his credit.

Mr TURNBULL:

– It appears, from what he said then, that he is quite a good man. He was right on the target. Another member of the Labour party who was present at that conference was Mr. McGirr, the Premier of New South Wales.

Mr Edmonds:

– A good man.

Mr TURNBULL:

– I shall not argue about whether he is good, bad or indifferent. I assume that, as Premier of New South Wales, he has knowledge of the requirements of that State. In the course of the conference, Mr. McGirr made the following statement in relation to the payments made to the States in respect of roads -

The basic amount is completely inadequate and there is a lag of one year in the adjustment of the grant.

Two members of the Labour party have expressed the opinion that the grant is inadequate.

The honorable member for Wannon (Mr. McLeod), who generally follows me and gives me a very rough passage, said that even if the whole of the revenue from the petrol tax were paid to the States it would not be sufficient to enable them to do the work that needs to be done on our roads, but the honorable gentleman did not go on to suggest that more money should be made available. Shire councillors and other persons in the Wimmera electorate have repeatedly asked me to do something to obtain for the States a greater proportion of the revenue from the petrol tax than is at present paid to them, and to explain the position at meetings. I know that the honorable member for Wannon has received similar requests. Finally, he said that he would bring the Minister for Transport with him to Hamilton in Victoria, but, as far as I know the Minister has not been there yet. I should like to know whether he intends to go there and to explain what the Government is doing with the £9,000,000 or £10,000,000 of the petrol tax revenue that it retains each year in Consolidated Revenue. The only justification for the petrol tax is that it should be used to construct roads and to repair the wear and tear on those already in existence. It is obvious that the greater the revenue from the tax, the greater is the wear on the roads. Therefore, the amount of money that is made available for the construction, reconstruction and maintenance of roads should be in keeping with the amount of money that is collected from the petrol tax. I was very pleased to read that Mr. Fagan did not refer only to road construction and maintenance but also to road reconstruction. That is a very important point. The traffic that is passing over our roads now and that passed over them during the war is much greater and heavier than was anticipated when they were constructed. Many of them require to be completely reconstructed. Unless that is done quickly, the opportunity to make good the deterioration that has occurred will be lost. I believe that any body that is entrusted with the care of public funds has a duty to maintain this asset. Between 1926, when the first Commonwealth Aid Roads and Works Bill was passed and the present time, millions of pounds have been collected from the petrol tax. The construction of thousands of miles of roads in the Commonwealth has been financed with at first the whole and later with part of the receipts from the petrol tax. In view of the necessity to expend many millions of pounds on roads, is it fair for the Government to withhold approximately one-half of the money that hae been collected from the petrol tax? The roads are valuable national assets, but they are deteriorating rapidly. Every person who has travelled through country districts knows that that statement is correct. If a road is not kept in satisfactory order, or is not quickly sealed, the money that has been expended upon its construction will be wasted.

The Prime Minister has said that the States have not been able to expend all the money which has been available to them for the construction and maintenance of roads. That statement is true only of the grants which the Commonwealth has made for the construction of roads in sparsely populated areas. The amount of money that has been provided for building roads in the sparsely populated areas of New South Wales in the last two years is £564,000, of which only £280,000 has been expended. The amount that has been provided for the construction of roads in the remote districts of Victoria in the same period is £348,000, of which only £280,000 has been expended. I ask the Minister to inform the House whether he has approved of all the applications that have been made by local governing bodies to build roads in sparsely populated areas.

Mr FULLER:
HUME, NEW SOUTH WALES · ALP

– Of course those applications have been approved.

Mr TURNBULL:

-I have asked the Minister to supply that information, and not the honorable member for Hume (Mr. Fuller), who has interjected. I should also like to know how much money has been provided to finance the construction of roads contemplated in those applications. I make it clear that I am referring, not to the grant that the Commonwealth normally makes to the States for the maintenance and construction of roads, but to applications for assistance to build roads in the sparsely populated areas. The two matters are quite distinct. The amount of money that was made available in 1948-49 as the normal grant by the Commonwealth to the States for the construction and maintenance of roads was £5,101,286. I understand that the whole of that sum has been expended. The only grant that has not been exhausted is the money that the Commonwealth has made available to the States for the construction of roads in the sparsely populated areas. I shall explain the reason for that position.

The construction of a road in a sparsely populated area necessitates the transport of workmen and machinery for considerable distances. For a number of years, the shortage of petrol has been so acute that local authorities have been deterred from undertaking such work. Does any honorable member believe that in these times a shire council would transport workmen and machinery distances of 40 or 50 miles, or perhaps 200 or 300 miles, to build a road? The workmen would have to be transported to and from the job at least twice a week, and those journeys would require considerable quantities of petrol. That is one reason why the Commonwealth grant for the construction of roads in the sparsely populated areas has not been expended. However, there are other reasons. We do not have to travel very far in Australia before we come to bad roads. Mildura, in my electorate, is unable to obtain sufficient money to enable the local authority to maintain the back streets in proper order. Two or three miles from the town, but still in a fairly densely populated area, the roads are as bad as any that I have travelled on in Australia. More money is required for that necessary work. I shall not put the spotlight on any particular places, but I mention that many roads connecting two towns in a part of the country which cannot be considered a sparsely populated area, are in a frightful condition. What was at one time a good road has fallen into a condition of disrepair, and a considerable amount of money will be required to enable it to be restored to a satisfactory state. If that work is delayed much longer, the road will be swept away in a summer dust storm.

When we appeal to the Prime Minister to make more money available for the maintenance and repair of roads, he invariably replies that some shire councils have not the machinery that is required for the job. That statement is perfectly true. Some shire councils have the necessary machinery but lack the money, and other shire councils have the money but lack the necessary machinery. So that I shall not be accused of being parochial, I shall refer to the position of the Stawell Shire Council, which is not in my electorate. The name Stawell should be familiar to honorable members because the famous athletic event, the Stawell Gift, is conducted annually in that town. Stawell is situated comparatively near the Grampians. Road-making material is near existing roads and the shire council has the necessary machinery, but it is unable to finance road-making and repair work. The Prime Minister may be able to cite a shire council that is able to obtain the necessary finance but lacks roadmaking machinery. The Government should provide sufficient money to enable shire councils which have . road-making machinery, to construct and repair roads within their boundaries. The Prime Minister . is of opinion, as he is in regard to so many other matters, that the Government must average everything that comes to its notice. He takes the view that if one shire council has no road-making machinery, other shire councils should not be provided with money to enable them to use their road-making machinery. It has been definitely proved that the cost of travelling by motor car over a good road is equivalent to 1-Jd. a mile cheaper than the cost of travelling over a poor surface. Motor vehicles which are constantly bumping over bad roads, often require repairing and new parts. They also use more petrol, and every honorable member knows that, in these days of dollar shortages, we must make every reasonable effort to conserve petrol. Spare parts for older vehicles are almost unobtainable, and it is difficult to purchase new vehicles.

Every argument that can be adduced in favour of improving our roads has, as its base, the welfare of Australia. The Prime Minister contends that the petrol tax is not a direct charge on the motor user but is a charge on the community. I disagree with the right honorable gentleman, but I desire to be fair to him. He states that certain motor users pass the petrol tax on to the general public, and that statement is true of a. small percentage of cases. A big percentage of receipts from the petrol tax is a charge on the motor user, and a small percentage is a charge on the community. How better can the Government serve the community than by encouraging the States and local governing bodies to build good roads? The people who live in the great cities would derive advantage from good roads which lead to the country districts. Large quantities of perishable foods are transported by road very quickly from country districts to the cities, and improved roads would lower operating costs and thereby enable the prices of the goods to be reduced. During the recent disastrous coal strike, motor transport played a most important part in our economy. As time passes, and we fail to produce sufficient coal to meet our requirements, road transport will become an increasingly important mode of travel. Railway travel is not so popular as it was years ago, and only a small percentage of the population can travel by air.

I commend the Minister for introducing this bill. I believe that the legislation is good, but I hope that, in future, the Government will not confuse the Commonwealth grant for the construction and maintenance of roads generally with the special grant for the construction of roads in sparsely populated areas. I also hope thatwhen the Government is asked to provide more money for the construc tion of roads, we shall not be told the old story that the Commonwealth has provided an additional £3,000,000 for that purpose, because we shall know that that sum will be earmarked for expenditure in the remote areas and not in those parts where the traffic is very heavy. I agree that adequate provision should be made for the construction of roads in the outback districts, but one of our principal responsibilities at the present time is to maintain existing roads in a proper state of repair, in order that those great national assets shall be preserved. The petrol tax in the United States of America is approximately 4d. a gallon, of which only 11/2d. is diverted to Consolidated Revenue. The remaining 21/2d. is expended on roads. The United States of America has excellent highways. Where there are good roads, motor cars are numerous. We in Australia stand on the threshhold of a great motor age. The honorable member for Hindmarsh considers that we are still living in the horse-and-buggy age, hut I disagree with him. No one wants to go back to the bullock dray and the cabbage tree hat.

Mr Archie Cameron:

– We shall go back to the -bullock dray if the present petrol shortage continues.

Mr TURNBULL:

– As the result of the excellent work of the Leader of the Australian Country party (Mr. Fadden), Australia will have more petrol in the near future. In the last days of this Eighteenth Parliament, and probablyin the last months of the Government’s existence, the Prime Minister and the Minister for Transport should recognize the wisdom of making appropriate grants direct to the States and local governing authorities for the construction and maintenance of roads. The local authorities should be permitted to determine how and where those grants shall be expended. Members of a shire council, as a rule, have lived in the district for many years, and are thoroughly familiar with local conditions. They should be permitted to make their own decisions in this matter. If we have bigger and better roads, we shall provide the basis for permanent prosperity in Australia.

Mr WHITE:
Balaclava

.- The Federal Aid Roads Agreement, which was introduced by the Bruce-Page Government more than twenty years ago, has the approval of the Australian people. That agreement has been modified from time to time to meet changing conditions, but under its provisions, roads have been constructed on an area-cum-population basis, so that Victoria and New South Wales, as the two most densely populated States, have financed the building of roads in the remote areas. Of course that is as it should be. The petrol tax of 10-Jd. a gallon is heavy, and is equivalent to the actual value of the petrol itself. Some of the receipts from thepetrol tax have been expended on developing the roads in sparsely populated areas. The point which I make is that the States, which provide the money, should not. bc forgotten when the Commonwealth is distributing grants in aid of roads. The grant that is proposed in this bill is for the construction of roads in the less closely inhabited districts. The Minister for Transport (Mr, Ward) should be aware that the Australian Council of Local Government Associations has asked for assistance, and should be given sufficient money for its needs. Generally speaking, the main roads ure in fairly good order, but back roads in country districts are in a deplorable condition. An authority should be appointed to deal with special cases. In some suburbs, much damage is caused by wind and sea erosion, and the drain on municipal revenue is particularly heavy. It is not always practicable to increase the rates. In my opinion, the amount which it is proposed to grant under this bill is inadequate, considering that revenue is so buoyant. The proceeds of the petrol tax may diminish because of the Government’s policy of restricting petrol imports, a policy which I believe to be unjustified, but the tax still provides a great deal of revenue, and h ere should be a more generous allocation to local bodies, including suburban municipalities.

Mr HAMILTON:
Swan

.- The honorable member for Hindmarsh (Mr. Thompson) spoke of having to follow a winding track when he first took up his farm. He is not the only one who has had to follow tracts so winding that they would break a snake’s back. The whole purpose of the scheme now under consideration is .to improve country roads in districts where the local municipality lacks the money to do so, while at the same time maintaining what are, in effect, main roads. The original measure was introduced by a Minister who was a member of the Australian Country party. A tax was imposed on petrol in order to provide revenue from which to make grants to State road-making authorities. The scheme has proved to be of inestimable value to the .public and to local bodies, and no one would now favour its abolition. The honorable member for Hindmarsh also advocated the amalgamation of small local bodies. That is feasible and practicable in some instances, but generally speaking, it is not. There is some justification for attaching a small pocket handkerchief area to a neighbouring one, but it is not in the best interests of the people to amalgamate largs localgoverning areas, because to do so tends to increase overhead expenses.

The honorable member also advocated the setting up of machinery pools. That was tried in Western Australia not. long ago. The Minister for Transport (Mr. Ward) will recall that the original act provided for the granting of money to local authorities for the purchase of machinery, when the States thought fit. In 1946 and 1947, it was very difficult to obtain road-making machinery in Western Australia because of rising costs, and industrial disturbances in various parts of the world. During 1947, I made representations to the Acting AttorneyGeneral to clear up this point of advances for machinery. It was suggested by the Minister for Works in Western Australia to a conference of local governing authorities that they should set up a machinery pool. At first, the idea was viewed with some favour, but, in practice, it proved to be impracticable.

Local governing authorities have a difficult task in building and maintaining country roads, and if the Commonwealth will not allocate more money for that purpose it could, at any rate, help by reducing or remitting the duties on imported road-making machinery. A power grader costs some thousands of pounds, and .the duty on the imported parts is a considerable item. It may be argued that it is of little use to increase the grants to local bodies because they have not been able to spend all .the money at their disposal. The reason, of course, is the scarcity of materials. While materials and labour are scarce, efforts should be made to devise new ways of keeping roads in good condition. The provision of materials necessary to achieve that objective, is largely the responsibility of the Commonwealth. Local governing bodies will be gratified to learn that it is proposed to make more money available for road maintenance and construction of roads in sparsely populated areas, but they will say that the money is of little use to them if they are unable to buy the materials they need.

Frequent mention has been made of the constantly rising cost of bitumen, machinery and labour, and no good1 purpose would be served by discussing the matter again. I do not know what the policy in the eastern States is, but in Western Australia the practice has been to seal with bitumen roads that run off from the railways, rather than those roads which run parallel to the railways. The main railways run north and south, so that the roads to which I refer run, for the most part, east and’ west. In Western Australia, there are still many hundreds of miles of dirt roads, and the local authorities can do little in the way of maintaining them except to run the grader over them after rain. The honorable member for Wimmera (Mr. Turnbull) spoke of members of local bodies in Victoria travelling 30 and 40 miles to meetings. In Western Australia, some of them travel 80 and 100 miles to attend’ meetings. I have done so myself, and I am not looking for any kudos for doing so. One gets a “ bug “ for local government work, and that is all there is to it. At seeding time, I have seen men go out into the paddocks at four o’clock in the morning so that they could put in eight hours’ work before twelve o’clock, and then travel long distances to attend meetings of local bodies.

It is a disappointing business trying to maintain country roads when it is impossible to get materials with which to seal the surface. For instance, a stretch of 10 miles of gravel road may be laid, and next year it is necessary to use the grader to remove corrugations, fill in potholes, and scrape up the gravel that has been scattered by heavy traffic. The tare of motor trucks is steadily increasing, with the result that they are carrying heavier and heavier loads. It is very difficult to obtain bitumen, and I suggest that investigations should be made, perhaps by the Commonwealth Scientific and Industrial Research Organization, in an endeavour to find a method of sealing gravel roads without the use of bitumen. It is better to gravel and seal 5 miles of road in a year, so that the work will have some degree of permanency, than to gravel a greater length of road that cannot be properly maintained. The effect of the latter policy is that the people who live farthest away always have to travel over a bad surface. Between Perth and York there is a stretch of road which has been sealed with a mixture other than bitumen. I do not know what it is, but it appears to be effective. The foundation, I admit, was laid with good, solid stone. The Government should try to discover some simple method of sealing gravel roads. For feeder roads, it is not necessary to use materials of the same lasting quality as for main roads that carry a great deal of traffic. Over Salt Lakes there is not a ripple in the roads. Whether that is because of the salt content of the soil or not I have not the slightest idea, for I. am a mechanical engineer and not a scientist; but there is something in the consistency of the soil that makes for a good, lasting and easy-riding road, which, in turn, makes for less wear-and-tear. I think similar conditions must exist in other parts of Australia. It is incumbent on the Government to order a scientific examination of the country to which I have referred. It would not cost much, and it is conceivable that the result would be lasting roads built more simply and more cheaply. It would not take much of the proceeds from the petrol tax to pay for such an investigation. I am pleased that another £1,000,000 is to be expended on roads in sparsely populated areas, because I know of the difficulties in those areas, having lived in some of them. I am sorry that the amount is not greater, but we must be thankful for what we receive. It is heartening that the amount allocated for roads in sparsely populated areas lias been lifted from the paltry sum of £1,000,000 three years ago to £3,000,000 this year.

Mr Calwell:

– Hear, hear!

Mr HAMILTON:

– I advise the Minister for Information, who says “ Hear, hear ! “ that the Government

Could still do much better, and that the local authorities are looking for it to do better. Some have asked me to make a direct approach to the Minister for Transport on their behalf. That cannot be done. The local authorities must go through the State authorities, which are the only authorities that the Minister deals with. Unless the local governing bodies can convince the State authorities of the justness of their claims, our talk is not of much value. I have heard it said repeatedly by Ministers, from the Prime Minister down, that, unless they get a request from the State on behalf of a local authority, whatever the member representing the locality in which that authority is situated says counts for naught. The men who serve on local authorities are not fools. They have an interest in their districts, but they are not parochial, and they want to see a fair deal given to other parts of the country. They are honest and earnest and their job is an honorary one, which is well done.

Mr RANKIN:
Bendigo

.- I consider the extra £1,000,000 that is to be provided for roads in sparsely settled areas is quite inadequate, but we are pleased to get even that amount. Victoria contributes about £5,250,000 of the petrol tax revenue and, this year, it will receive back about £1,250,000. The petrol tax is a class tax. By that I do not imply that it is necessarily paid by wealthy men who can buy high-powered motor cars and’ tour the country for pleasure. There are thousands of young working men who make a living out of road transport. The wear and tear on roads is immeasurably greater than it was a few years ago. During the war, roads in such shires as the Heathcote Shire were heavily damaged-. In the Heathcote Shire there is a big area of State forests. There is also a big military camp. Military transport has done tremendous damage to the roads in’ the shire. During the shortage of coal, road transport was allowed to take timber to military camps and to the cities of Melbourne and Bendigo. The- operators were compensated to only a small extent. Victoria is not getting a fair deal. I admit that Victoria has not the problem of Western Australia, Queensland and western New South Wales, because it is a compact and richly endowed State and it is extremely fortunate in having in the Country Roads Board the most efficient authority of its kind in Australia. It has supplied first-class men to almost every other State main roads authority. Victoria, however, has special problems. It has a very fine education system. It is developing consolidated schools, much on the same system as that in operation in Tasmania. Throughout the State there are high schools and technical schools that give country children some opportunity to get over the disability of living far from the big centres of education. The Government operates a bus service to pick i*p the children and take them to school. Some of the buses have to use unmade roads. That causes heavy loss to the local authorities. °The Country Roads Board and the shires have never been able to get enough money to keep their road-making plant and road gangs fully employed. It has been said in this House that it is of no use to give the States more money because the local authorities cannot spend it on roads. The shires of Charlton, Rochester and Kerang have built up power road-making equipment and efficient staffs, but they have never been able to get enough money in the last four or five years to repair war-time damage and to maintain roads. They have not been able to keep their staffs employed and have lost them to other jobs. When they have received money to carry on their work, they have not been able to get their men back. I hope that the Minister for Transport will look at the matter fairly and decide that the tax on the motorists of Australia shall be distributed more equitably. There is no justification for taking £9,000,000 of the money received from the petrol tax and paying it into Consolidated Revenue when that money is needed for road purposes. We have had a revaluation in

Victoria recently. In my own shire, rates have been increased by 85 per cent. Taken in conjunction with federal and State taxes, that is a heavy burden on city men. and country men alike. Notwithstanding the increased rates, the local authorities still cannot keep their roads in a reasonable condition so that people who live away from the main roads may have ready access to them in order to conduct their business or, in an emergency to get to a doctor. It is absolutely essential that more money shall be made available so that those roads may be brought to something approaching the condition that they were in before the war. I hope that the Government will favorably consider the matter and decide on a more equitable distribution of the proceeds from this class tax, which is a tax imposed not only on the leisured and wealthy people but also on men who make their living out of road transport services.

Mr WARD:
Minister for Transport and Minister for External Territories · East Sydney · ALP

– m reply - Every honorable member who has spoken to this bill has expressed himself as in favour of it,°but some members of the Opposition have endeavoured to damn the efforts of the Government with faint praise. Some of them need to brush up their history a little in regard to legislation of this character. The honorable member for Swan (Mr. Hamilton) said that the original bill was introduced by a Country party member. In country districts this measure is one of the most popular measures ever introduced by any government. So members of the Australian Country party are endeavouring to claim the credit for its introduction. If is true that legislation was introduced years ago to assist the States to develop a road system, but the first government to ear-mark money for roads in sparsely settled areas was the present Labour Government. That is a principle to which particular attention has been devoted. We have gone on increasing the allocation of money for that purpose. I have heard members of the Australian Country party imply in addresses to the electors that the Labour party represents only city interests and has no regard for the people outback. I was born in the city and T represent a metropolitan con stituency, but I think nationally and I want this country to be properly developed. Its development depends on an efficient and adequate transport system. That is why the Australian Government assists the States to improve and reconstruct their roads. Honorable members must not lose sight of the fact that the construction and maintenance of roads is primarily the responsibility of the States, not qf the Commonwealth. The Commonwealth, however, because of its national interest, makes a substantial contribution to the States for road purposes. It knows that the States cannot afford to do the job without help. Honorable gentlemen opposite have described the petrol tax as a “ special “ tax. ‘ The honorable member for Bendigo (Mr. Rankin) described it as a “ class “ tax. They argue that all the proceeds should be used for road purposes. 1 contest that argument. The petrol tax was first levied as a revenue tax. Later ‘ it was increased to provide the necessary funds from which to assist the States to do road work. If it can be argued that the petrol tax is a class tax and that the money derived from it should be devoted exclusively to road work, it could equally be argued that the excise on alcoholic beverages is a class tax and that the money derived from it should be exclusively used on the improvement of facilities for drinking. Such an argument could be advanced through the whole field of taxation. A wrong impression has been created because the distribution of the grant to the States for roads has been determined on the basis of the use of petrol. Because of that fact a wrong impression has been created that the whole of this tax was deliberately imposed for the purpose of carrying out, road works.

I turn now to the remarks of the honorable member for Wimmera (Mr Turnbull) . I think it is safe to say that he will never qualify as a “ roads “ scholar, because in respect of every point that he attempted to make he did not hit the bullseye once. He spoke as if the Australian Government had been responsible for the fact that certain shires and municipalities had not received any money as the result of the original legislation. I recall that when the legislation was introduced in 1946 one of the objections taken by honorable members opposite was that, according bo them, the Minister for Transport in this Government would exercise dictatorial powers and that he would, be able to say where the money’ should be spent and for what purpose. Some of the provisions of that legislation were designed to ensure that the principle of spending a large proportion of the allocation for roadwork in sparsely populated areas was adhered to. The Government works in co-operation with the States. All it asks the States to do is to submit their schedules of works so that we can see that the money is being spent for the purposes for which this Parliament has voted it. It was rather remarkable to hear the honorable member for Wimmera attempt to make a great deal of the contention that these moneys were not, in fact, being expended on the purposes for which they were voted. He evidently does not know exactly what is going on in his own electorate, because if he obtains the figures in regard to the distribution of the last allocation he will find that more money was expended in his own electorate from that allocation than was expended in any other electorate in Victoria. The honorable member appears to be very upset over the fact that a Labour Government was able to make possible work in his electorate that he was unable to achieve through his own representations. As I have said, this Labour Government views this problem as a national one. The honorable member asked if I could tell the House in what shires an allocation of money was refused by me. I desire to inform him that I have approved every schedule of works that has been submitted by the various States. Any representations that honorable members desire to make regarding areas that they consider are neglected should be made to the State authorities. The Australian Government does not attempt to dictate to the States. It merely tells them that the sum of £3,000,000 to be allocated this year for this work is to be spent for the particular purpose for which it was voted.

The honorable member for Wimmera also said that he knew that all that money paid to the States under section 6 (3.) of the act had been expended. I do not know where he obtained his information, because the latest figures supplied to me by departmental officers, the veracity of whom I have no reason to doubt, show that of the money allocated under section 6 (3.) of the act’ £1,628,000 had not been expended. Some hundreds of thousands of that total was left unexpended in the State of Victoria. Although we voted an additional £1,000,000 last year to toe expended in sparsely populated areas, the last report indicated that £1,000,000 of the total allocation ‘ remained to be expended. So it can be seen that the honorable member’s statement that all- the money has been spent is not borne out by the facts.

The honorable member for Swan (Mr. Hamilton) was wrong when he stated that the Australian Government had done nothing to enable shire and municipal authorities to obtain essential roadmaking machinery. He said that the system of plant pools had been tried in Western Australia, that it had failed and that it had been abandoned. That is not the case, which shows conclusively that the honorable member does not know what is happening in regard to this particular matter. The report from Western Australia says -

Allocations of £00,000 for the purchase of plant have been approved for the financial years 1947-48, 1048-49 and 1949-50. The policy which has been adopted by the State of Western Australia is that the general basis of giving assistance to Local Authorities should be by the establishment of plant pools operated by the Main Roads Department.

Of the sum of £60,000 allocated per year for the purchase of plant, 10 per cent, has been set aside for direct financial assistance to Local Authorities with small revenue and difficult .plant .problems, and to that end allocations varying from £300 to £500 were made to 31 Local Road Boards from funds available up to 30th June, 1949.

Mr Hamilton:

– I rise to order! I did not say that. What I said-

Mr DEPUTY SPEAKER:

– There is no point of order. What is involved is only a point of view.

Mr WARD:

– So it is quite evident that the plant pools in Western Australia have not been abandoned.

Mr Hamilton:

– I did not say that they had been.

Mr WARD:

– Neither have they proved to he unsuccessful. Some honorable members opposite have raised a rather peculiar argument in this debate, and I suggest that members of the Australian Country party in particular ought1 to get together and make up their minds about their views as a party. We can imagine what would happen to the system of road works, if by some mischance the Opposition parties were returned to office as a government. The honorable member for Wide Bay (Mr. Corser) does’ not want this money to be expended in sparsely populated areas. He wants it to be expended in areas where the greatest proportion of motor users resides. That is to say, he wants it to be expended in the cities. He also complained that none of the moneys allocated were available or had been used for the purposes of improving boat havens and facilities for the fishing industry. I he had read the act he would know that one-sixth of the money provided under section 6 (3.) may be used by the States for works connected with transport, which include boat havens. The report from Queensland states -

The State of Queensland has recognized the principle of expending money for harbours, havens, &c, by establishing a Commonwealth Aid Marine Works Trust Fund. For the year 1947-48, an allocation of £10,000 was paid to this fund, and an actual expenditure of £1.705 was incurred during the year, allocations varying from £225. to £3,000 being made to eight projects from the above trust fund. For the year 1948-49, a further allocation of £10,000 was made to the Marine Works Trust Fund, and allocations were made to 14 projects, totalling £.13,295, against which an expenditure of £4,799 was incurred. At 30th June, 1949, the balance of the Marine Trust Account stood at £13,49(5.

That report shows conclusively that in Queensland a considerable proportion of money from this vote has been allocated for the purpose mentioned by the honorable member. The honorable member for Wimmera stated that all that is left for the remainder of the roads of Australia, after leaving out the £3,000,000 for sparsely populated areas, is £5,500,000. The honorable member is working on the assumption that the Commonwealth provides .all the money for road construction in Australia. [Quorum formed.’] The States themselves provide a considerable amount of money for road purposes, but all the taxation that they levy on the roadusing industries is not used exclusively for road purposes, or at least there is no evidence that such is the case. On the contrary it appears that a large proportion of it has never been used for that purpose. Honorable members may talk as much as they like about the inadequacy of the amount to be provided by this legislation, but the fact remains that it is approximately double that which was provided by an anti-Labour government for road purposes in the financial year 1938-39, which was the last year prior to the outbreak of the war. Besides providing additional money the Australian Government has also, in co-operation with the States, set out to deal with other aspects of the problem, which can only be dealt with on a national basis. That is to say, we are examining the question of vehicular standards and loadings and the States are co-operating with us in that matter. The Commonwealth does not intend to continue to pour out money for the construction of roads if they are to be destroyed by vehicles that are obviously too heavy for the roads they are using.

The honorable member for Reid (Mr. Lang) raised a number of points, one of which concerned the Sydney Harbour Bridge, which, as far as I can see, has no relation to this particular measure. I merely say in reply to his remarks that it is quite true that the imposition of a toll on the Sydney Harbour Bridge creates a traffic bottle-neck. The only means by which that bottle-neck can be overcome is to abolish the toll, but I cannot see that that matter is a direct responsibility of this Government. It really comes down to the question of how national works are to be financed. The honorable member mentioned the great burden of interest in connexion with the Sydney Harbour Bridge, and the fact that the toll had to be imposed to enable that interest to be paid. The fact is that if governments planned of finance by using the Commonwealth Bank, there would be no need for either a toll or a burden of interest on the Sydney Harbour Bridge or similar projects. I agree that the difficulty exists, but I think that the way to overcome it suggested by the honorable member is not the right way.

Mr Pollard:

– Who imposed the toll in the first place?

Mr WARD:

– The honorable member for Reid was Premier of New South Wales when the harbour bridge was completed and when the toll was originally imposed. I know that some honorable members favour roads as opposed to railways, whilst others argue that railways ought to take the place of certain roads. The opinion of the Australian Government is that there ought to be a complete, co-ordinated system of transport throughout the Commonwealth in which all these methods of transport could be effectively and economically used. The Government has set out therefore to improve railways and roads. It is watching the position quite closely and will have regard to the needs of the various States and local government bodies, which it will assist to the utmost. At the moment, because of the lack of materials, manpower and equipment, the States and shires have found it impossible to use all the money provided for road works. The right honorable member for Cowper (Sir Earle Page) has spoken about the necessity for long-term financial arrangements which, he said, would permit the shires to plan. The States are responsible for the allocation among shires, and this Government has never suggested that there ought to be a decrease of such expenditure. There is no reason why the States should not plan on the present basis. The Government realized at the outset that it would be necessary to review the position from time to time. State governments and the shire councils wanted’ an agreement for a longer term and it was decided after full consideration that the agreement should operate for three years. All the suggestions that have been made during this debate will be considered by the incoming Labour Government next year when the agreement expires.

Question resolved in the affirmative.

Bill read a second time.

In committee:

The bill.

Mr MCDONALD:
Corangamite

– Clause 4 of the bill proposes to leave out the proviso to paragraph (c) of sub-section (5.) of the principal act and to insert in its stead the following proviso : -

Provided that a statement of the proposed expenditure by the State for the remainder of the year which commenced on the first day of July, One thousand nine hundred and fortynine, on road construction and maintenance out of any amount payable to the State under paragraph (c) of sub-section (4.) of this section shall be submitted by the State to the Minister prior to the thirty-first day of October, One thousand nine hundred and fortynine.

It is unfair for the Minister (Mr. Ward) to say that the States neglected to expend the grants that had been allotted to them. One of the reasons why they could not expend the money was because the allocations were made too late to enable the money to be expended in the financial year. To-day is the 20th October. By the 31st October the complete schedules of works must be in the hands of the Minister. It will be quite impossible for the States to prepare schedulas of works within that period. The Minister has said that he is anxious to assist the States, the municipalities and local governing bodies in the implementation of their road programmes. If that be so, I suggest that he should have recommended a very much earlier allocation of money and should also have given the State governments, the municipalities and the local governing bodies a much longer period in which to prepare their schedules of works. Surely the honorable gentleman appreciates the fact that the preparation of schedules of works estimated to cost £1,000,000 must take some time. The honorable gentleman has said’ that the Government of Victoria had failed to expend by some hundreds of thousands of pounds the money allocated to it. That Government expended a much greater proportion of the money than did the governments of most other States. The Victorian Government expended between 70 and 80 per cent, of its allocation, whereas the governments of some ef the States expended only 50 per cent, of their allocations. The Minister has also said that the whole of the revenue which is derived from motor registrations and licence-fees is not made available by the States for roads works. I do not know what the position is in the other States, but in Victoria I know that the whole of the revenue derived from those sources is credited to a fund which is controlled by the Country Roads Board and is utilized for the construction and maintenance of country roads. I am pleased that the Minister has indicated that he -will endeavour to bring about the greatest possible co-operation between the Commonwealth, the States and the local governing authorities in this matter, and that he will do his best to ensure that ample money shall be made available for road construction.

Mr TURNBULL:
Wimmera

– Will the Minister state whether it is true that the yield from the petrol tax is now approximately £17,500,000 per annum ? I understand that of the revenue derived from the petrol tax, £3,000,000 is granted for the construction of roads in sparsely populated areas, and approximately £5,500,000 is made available for all other roads. Approximately £9,000,000 of the receipts from the petrol tax is retained by the Government for other than road purposes. Will the Minister confirm or refute these figures? I should like him to cite the actual figures so as to put the matter beyond doubt.

Mr BERNARD CORSER:
Wide Bay

.- The Minister has said that t favoured the utilization of the proceeds of the petrol tax for the construction of roads only in areas in which the greatest number of road users reside, and that I opposed the Government’s practice of using the money for the construction of roads in sparsely populated areas. If that were so, I should have opposed this bill. My objections to the principles of this .bill are very well known to .the honorable gentleman. I had thought that I conveyed my views in plain English during my second-reading speech. I contend that the provision of roads in outback areas should be a charge on the general revenues of the Commonwealth and not on the proceeds of the petrol tax. Under the system adopted by the Government local governing authorities in closely settled areas will receive no assistance under the provisions of this bill. This year an amount of £3,000,000 will be diverted from the .proceeds of the petrol tax and utilized solely for the construction of roads in outback areas.

Motorists generally will derive no benefit from the expenditure of that money.

The DEPUTY CHAIRMAN (Mr. Burke). - The Chair has no desire to restrict the debate, but the honorable member must connect his remarks with some clause in the bill.

Mr BERNARD CORSER:

– I am directing my remarks to clause 3 which provides for an additional grant of £1,000,000 for the construction of roads in sparsely populated areas, making a total provision of £3,000,000 for that purpose during the current financial year. The Government has side-stepped its obligation to finance road construction in isolated areas from general revenue.

The DEPUTY CHAIRMAN. - Order ! The honorable member may not continue along those lines. Those remarks might well have been made during the secondreading debate.

Mr BERNARD CORSER:

– I submit that my remarks are relevant to clause 3 of the bill. Even if the whole of the £8,500,000 provided for road purposes were granted to the local governing authorities it would be insufficient to meet their needs. It is bad practice for the Government to utilize the proceeds of the petrol tax for the construction of defence roads in isolated areas. The proceeds of the petrol tax should be utilized for the construction of roads which will be used by the greatest possible number of those who contribute the tax. The construction of roads in isolated areas should be undertaken, not by the local governing authorities, but by this Government.

Mr ADERMANN:
Maranoa

– I wish to elaborate the remarks that have been made by the honorable member for Corangamite (Mr. McDonald). I recall the debate that took place when the first bill to make available a sum of £1,000,000 for road works in sparsely populated areas was introduced. I then said that insufficient time had been allowed to local governing authorities to prepare their schedules of works. An examination of the records will show that the authorities were unable to prepare their schedules within the time specified and that in consequence they received no grant during that financial year. We do not want that to occur again this year. If the schedules of works are not completed and furnished by the specified date, will the Minister allow the money made available this year to be added to the grants for the following year? If that is done the benefits of this bill may be availed of at a later date.

Mr WARD:
Minister for Transport and Minister for External Territories · East Sydney · ALP

.- There is nothing in the point raised by the honorable member for Corangamite (Mr. McDonald) and the honorable member for Maranoa (Mr. Adermann), becausein anticipation of the passage of this legislation, the States were advised that an additional £1,000,000 would be allocated this year and already four States have submitted their schedules of works. In this instance the Department of Transport acted in advance, knowing that the Parliament would approve of this proposal. The honorable member for Wimmera (Mr. Turnbull) has referred to the conversion of portion of the proceeds of the petrol tax. I did not understand what he meant. I assume that he has implied that the whole of the proceeds of the petrol tax should be used for road purposes. It is true that the petrol tax is imposed on one section of the community, but so also are the taxes imposed on beer drinkers and smokers. In its treatment of the States in relation to the proceeds of the petrol tax, this Government has been more generous than has any government that preceded it.

The honorable member for Wide Bay (Mr. Corser) has argued that the proceeds of the petrol tax should not be utilized for the construction and maintenance of roads in sparsely populated areas. It is necessary for the national development of this country that we should have regard to the people who live in the outback areas. We want to give to those who live in the outback good road services and we have no intention of departing from that policy.

Mr TURNBULL:
Wimmera

– The Minister for Transport (Mr. Ward) has said on other occasions that road construction and maintenance is a responsibility of the States. As- the petrol tax is collected from motor users in the States, and as this Government in the seclusion of Canberra gets the money into its coffers-

The DEPUTY CHAIRMAN. - Order ! The honorable member must discuss the bill.

Mr TURNBULL:

– I am addressing my remarks to the proposal to provide an additional £1,000,000-

The ‘ DEPUTY CHAIRMAN. - Order ! The honorable member must connect his remarks with some clause in the bill.

Mr TURNBULL:

– I am dealing with clause 4 of the bill. As the States have lost their sovereign power to tax the people–

The DEPUTY CHAIRMAN.Order! The argument that the honorable member is developing has no relation to clause 4 of the bill.

Mr ADERMANN:
Maranoa

– I should like the Minister to explain more fully what will happen in respect of moneys that have teen allocated but which remain unexpended owing to the shortage of labour and materials. The honorable gentleman will appreciate that it is difficult at times for local governing authorities in outback areas to obtain labour to carry out their works programmes, and that road grading equipment is still in short supply. If any money remains unexpended at the .end of the financial year, will it be left to the credit of the local governing authority, or must it be paid to the Consolidated Revenue Fund?

Mr WARD:
Minister for Transport and Minister for External Territories · East Sydney · ALP

.- Briefly, this Government deals directly with the State governments, which in turn deal with the local governing bodies. The Commonwealth does not endeavour to impound any moneys which remain unexpended. Money is made available to the States on the basis of the schedules of works submitted. If a local governing authority has an unexpended balance at the close of the year the sensible procedure would be for that State government to allow it to retain the money in order to finance the work at a later date.

Bill agreed to.

Bill reported without amendment; report adopted.

Bill read a third time.

page 1794

STATES GRANTS (COAL MINING INDUSTRY LONG SERVICE LEAVE) BILL 1949

Bill presented by Mr. Dedman., and read a first time.

Second Reading

Mr DEDMAN:
Minister for Defence and Minister for Post-war Reconstruction · Corio · ALP

’. - by leave - I move -

That the bill be now read a second, time.

The purpose of this bill is to arrange for the financing of long service leave benefits which have been granted by an award of the Coal Industry Tribunal issued on the 14th October, to certain employees in the coal-mining industry. Other measures which will be brought forward shortly are complementary to this bill and, taken with this measure, form a single scheme. Honorable members will doubtless be aware that after having lodged a claim with the Coal Industry Tribunal for long service leave, which up to that time had not been determined, on the 19th May of this year the miners federation also included long service leave in a log of claims served on the colliery proprietors, the Joint Coal Board and the Australian and State governments. This log of claims was considered at a series of conferences of the parties concerned. At these conferences it was emphasized that if an award of long service leave were made, the cost could not be borne by the individual owners but would have to be financed on an industry basis. The representative of the Australian Government, Senator Ashley, said that, if long service leave were granted either by agreement between the unions and the proprietors or by an award of the tribunal, the Australian Government would arrange for finance for such a scheme. At the same conference, the then New South Wales Minister for Mines, Mr. Baddeley, representing the New South Wales Government, stated that his Government would “ play its part “. Honorable members will know that those conferences broke down. The tribunal then proceeded to conclude the hearing of the long service leave case, and announced that it would issue a draft award for discussion between the parties on the 14th June. Because of the general strike in the industry and the events which preceded it, the draft award was not issued. After the strike ended, the matter was reconsidered by the tribunal, which has now made an award in respect of members of the miners’ federation employed in the coalmining industry. This award is identical with that made in draft form prior to the strike. The Government is now proceeding to provide the machinery for the running of the scheme.

It will doubtless be evident to honorable members that it would be impracticable for the cost of the leave to be made the full financial responsibility of the individual employers. I shall mention some of the reasons. During their working lives, many employees have changed from one employer to another, and it would be inequitable to place the cost of all such employment solely upon presentday employers. Some collieries are not financially capable of meeting the additional cost involved by the leave. Many employees have been employed in the past by colliery companies that are no longer in existence. Moreover, employers would be reluctant to employ men with previous employment in the industry because of the additional liability for long service leave that their employment would involve. This would tend to make labour less mobile than is desirable within the industry, and could result in a loss of skilled labour to the industry. It is also not unreasonable to provide some protection to employees against employers going out of business or becoming insolvent. Under these circumstances, the award can only be financed on an industry-wide basis. To make this possible the establishment of a central fund is necessary in order to spread the liability evenly amongst employers, and particularly to finance the heavy burden p( introspective liability.

Broadly, the scheme now placed before the House in this interdependent set of three measures is that an excise of 6d. a ton will be placed upon coal produced by those employees in the coal-mining industry who will receive the benefit of long service leave. The proceeds of this excise will be placed in the Commonwealth trust fund and from this fund the Treasurer of the Commonwealth will be empowered to make grants to the States. It will be necessary for each State to which the award applies, that is, all States of the Commonwealth excluding South Australia, to pass complementary State legislation to authorize the State to reimburse employers for their long service leave liability under the award and for the State to recoup this expenditure from the Commonwealth. The State legislation will need also to establish appropriate administrative arrangements and make the necessary machinery provisions. After the passage of the present legislation, the Treasurer (Mr. Chifley) will negotiate with each State and upon the passage of the necessary State legislation a formal agreement will be entered into between the Commonwealth and the State to provide in detail for payments from the Commonwealth trust fund to the State. It is provided in clause 4 of the bill that these agreements must be approved by the parliaments of the Commonwealth and the State before any payments are made from the central fund. It is intended that the agreements shall specify in each ease the award to which the scheme applies. Commonwealth funds will not be provided for any increased expenditure arising out of amendments to the award or any additional awards relating to the coal industry until the agreements have been amended and the amendments ratified by the parliaments.

The long service leave that has been awarded by the Coal Industry Tribunal is broadly on the basis of three months’ leave for every ten years’ service in the industry. Under the award, long service leave is to accumulate in the future at the rate of one-eighth of a shift for each five consecutive shifts worked. Long service leave will become due when 65 shifts of entitlement, or thirteen weeks’ leave, have accrued. For an employee who works continuously, this approximates to three months’ leave for ten years’ service, but if the employee does not do this continuous service he will take correspondingly longer than ten years to become entitled to his thirteen; weeks’ leave. For past periods of employment in the industry leave has been awarded on the basis of five days’ leave for each year pf employment up to a maximum of thirteen years, that is, a maximum of three months’ leave in respect of all past employment. No leave may be taken before the 1st January,. 1954, but provision has been made in the award for payment in lieu of leave in cases of retirement due to age or ill health or in cases of death. A further provision of the award is that in the future theaward will be suspended in the event of ai strike in any district until the tribunal! otherwise orders. Because of the general strike, the tribunal has imposed a penalty which means that employees must work approximately a further twelve months in order to gain the same entitlement as they would have had if the strike had not. taken place.

The a ward issued in respect of members of the miners’ federation will cover all coal mines throughout Australia, with the exception of the State coal mine at “Wonthaggi, the men there being already entitled to long service leave under Victorian State legislation,- and Leigh Creek field in South Australia and the open-cut brown coal mines in Victoria, neither of which are subject to the jurisdiction of the special industrial authorities that have been established for the coal-mining industry.

Under the measure to be introduced to impose an excise on coal, it is proposednot to tax coal produced by a State. However, the Government proposes that, where applicable, the States shall he asked to pay into the trust fund an amount equivalent to the excise and thus become entitled under the agreement to reimbursement of the cost of long service leave payable to employees at State mines-.

The cost of the scheme has been estimated on the basis that there will be a peak period for leave in 1954 and the? two or three years following and in the few years following 1960. As I have already mentioned, except for payments in lieu of leave to employees in certain cases, leave will not be taken before 1954. Over the next eleven years, which tak.es in the two peak periods of leave entitlement, the cost of leave at current wage rates will call for an annual payment of approximately £360,000 into the fund. This suggests a levy of 6d. per ton on all coal produced except at Wonthaggi and open-cut brown coal mines in Victoria and at Leigh Creek in South Australia. I commend the bill to honorable members.

Debate (on motion by Mr. Holt) adjourned.

page 1796

COAL EXCISE BILL 1949

Bill presented by Mr. Dedman, and read a first time.

Second Reading

Mr. DESMAN (Corio- Minister for

Defence and Minister for Post-war Reconstruction) [10.41]. - by leave - I move -

That the bill be now read a second time.

This bill relates to the proposal to impose an excise duty on coal for the purposes that were explained to honorable members when the States Grants (Coal Mining Industry Long Service Leave) Bill 1 949 wasbefore the House a few minutes ago. Provision is made for the licensing and control of mines producing excisable coal. The measure will give normal administrative power to officers of the Department of Trade and Customs to exercise such supervision as is essential to ensure collection of the duty payable, and contains no unusual features. Penalty clauses are included to cover possible breaches. The hilt is self-explanatory and will fulfil its purpose.

Mr DEDMAN:
ALP

– Approximately £360,000 a year.

Debate (on motion by Mr. Holt) adjourned.

page 1796

TARIFF PROPOSALS 1948-49

Excise Tariff Amendment (No. 3)

In Committee of Ways and Means:

Mr DEDMAN:
Minister for Defence and Minister for Post-war Reconstruction · Corio · ALP

– I move -

That the Schedule to the Excise Tariff 1921-1948, as proposed to be amended by the Excise Tariff Proposals introduced into the House of Representatives on the seventh day of September, One thousand nine hundred and forty-nine, be further amended, as hereinafter set out, and that on and after the first day of November, One thousand nine hundred and forty-nine, Duties of Excise be collected in pursuance of the Excise Tariff 1921-1948as so amended.

The purpose of the tariff proposal that I have just introduced is to impose an excise duty of 6d. a ton on certain prescribed coal. Honorable members are already aware of the Government’s reasons for taking this action. It is proposed to administer this item under a departmental by-law that will prescribe and define the coal on which duty shall be payable. Briefly, the duty will apply to all coal mined in Australia other than coal the property of a State or brown coal produced by open-cut methods.

Progress reported.

page 1796

STATES GRANTS BILL (No. 2) 1949

Second Reading

Debate resumed from the 5th October (vide page 906), on motion by Mr. Chif le y -

That the bill be now read a second time.

Mr McBRIDE:
Wakefield

– Bills similar to this measure have been passed by the Parliament annually for a number of years. It was realized when the States federated that some States would not be able to discharge the whole of their financial obligations. Consequently, grants were made to States early in the history of federation. During recent years the grants have been made in a more orderly manner than was the case sixteen years ago. The Commonwealth Grants Commission was established for the purpose of investigating the activities of the States and assessing the financial assistance that, for instance, South Australia, Western Australia and Tasmania would require from the Commonwealth in order to maintain the standard of living of their people at a level equal to that of the people of the other States. It is interesting to note that during the time that the. Commonwealth Grants Commission has been in existence its recommendations have been accepted by whatever Government has been in power and the legislation necessary to implement the recommendations has been passed by the Parliament It is a compliment to the work of the Commonwealth Grants Commission that all governments, irrespective of their political views, have accepted its findings. The commission makes an exhaustive investigation into the activities and financial responsibilities of the claimant States and the non-claimant States, and assesses the amounts that the claimant States should receive to enable them to maintain a standard comparable with that of the non-claimant States. As the result of those investigations, the commission has an accurate and comprehensive knowledge of the general economic position of the whole of Australia. I shall direct attention to some of the comments that the commission has made in its sixteenth annual report about the economic condition of this country. The Labour Government has been extraordinarily vocal about the prosperous condition of this country, and has attributed a large measure of that prosperity to its own administration. The Commonwealth Grants Commission is much more realistic about the matter. In its survey of the Australian economy, it has made some very pertinent remarks. It has pointed out, for instance, that the rapid increase of the national income during the last few years is due almost entirely to the higher prices ruling for our production, particularly our primary commodities. Referring to primary production, the commission makes the follow ing statement on page 15 of its sixteenth annual report : -

Gross income from primary production, particularly wheat and wool, increased considerably; but, although the financial strength of primary industries improved, their prosperity was due almost entirely to abnormally high prices. High .prices have more than offset rising costs, and have disguised the effects of serious shortages of labour and material, and static production.

Those statements by an impartial body must be accepted as authoritative, because the Commonwealth Grants Commission owes no allegiance to any political party or any government. Honorable members opposite should realizethe facts as stated by the commission. The Prime Minister (Mr. Chifley) and’ other Ministers have referred to theextraordinary increase of the standard, of living of the Australian people under theLabour Government’s administration.

Mr Barnard:

– Hear, hear!

Mr McBRIDE:

– It is interesting to read the commission’s views on that point, because it has made an exhaustive examination of the situation in all States. The following comment appears on page 17 of its sixteenth annual report : -

Personal consumption, as a percentage of gross national product, remained at the same level as in 1946-47, but it was still below the pre-war figure.

The House and the people should realize that rather alarming position. In spite of all the flap-doodle, and the eulogies that the Government has passed on its own administration, the impartial Commonwealth Grants Commission expresses the view that personal consumption is still below the pre-war level. That position is not due to the fact that people have less money now than they had before the war. The explanation is that the goods which people require are peculiarly conspicuous by their absence, and the prices of those goods that are available have increased considerably compared with the pre-war figures. The Commission proceeds to point out that the static position applies not only in respect of wool, wheat, meat and other primary products, but also the mining industry. That is most unfortunate. Referring to that particular subject, the report states -

Quantities of all the main minerals produced, with the exception of copper, increased in 1047 as compared with the previous year. Gross value of mineral production reached record levels as a result of this higher production and high prices. Nevertheless, mineral production levels are still below those of 1B3U.

I hope that we shall not hear any more of those mis-statements which we have heard so frequently with the approach of the general election about such important matters. My reference to inaccurate statements prompts me to refer to the very snide way in which the honorable member for Wilmot (Mr. Duthie) tried recently to support the Government’s contention about increased production. One of the matters that he has mentioned in my hearing on two or three occasions is the production of wool. He referred to the production of a number of commodities, and in a very snide way, he said that the wool exports in 1948-49 exceeded the exports in 1938-39 by 1,000,000 hales. The honorable member did not tell the House that the export of wool in 1938-39 had no relation to production.

Mr Ward:

– What has that to do with the bill?

Mr McBRIDE:

– It has a great deal to do with the bill, because it is on the basis of our economic .position that the Commonwealth Grants Commission has recommended the payment of grants to the claimant States. The report of the commission also shows that employment in the primary industries has not risen so substantially as it has in certain other industries. That fact has been recognized by honorable members opposite, but in order to place the matter beyond doubt, I shall read the views of the Commonwealth Grants Commission on that subject. The commission reported as follows : -

Latest census figures indicate that, although total population during the intercensal period increased by 14 per cent., rural population declined both absolutely and relatively.

That is a sad commentary on the alleged progress that has been made in this country. I believe that our prosperity has rested, and still rests substantially upon the development of the primary industries.

The Prime Minister and other Ministers frequently refer to the improved financial position not only of producers but also of the Australian people generally. They quote savings bank deposits to support their contention, and I admit that, unquestionably, savings bank figures have increased substantially from £245,000,000 in 1939 to £714,000,000 in 1949. However, it is interesting to note that whilst deposit* have increased, the overdraft figures of. the Commonwealth and private banks have also increased. The total advances, by all Australian banks in 1939 amounted to £291,000,000, but the figure this year s. £383,000,000. Therefore, it is clear that, in spite of the high prices ruling, and the fact that many people are undoubtedly in a better financial position to-day than they were in a few years ago, the banks are called upon to render greater assistance to the productive efforts of this country. The Commonwealth Grants Commission has made a careful examination of the development that has taken place in both the claimant and non-claimant States. South Australia, in which I am particularly interested, has. made extraordinary advances in production per capita, probably exceeding the advances made by the richest State, New South Wales. Of course, much of that development does not return any revenueto the State government. When a factory is erected, the State Government is. obliged to construct roads and providewater and power services, and other facilities that are required by a secondary industry, hut as soon as the factorybegins to produce goods, the Commonwealth derives the benefit. It leviesincome tax on the profits that the company makes, and sales tax on the sales of the goods. From the standpoint of’ the claimant States, the greater thedevelopment within their boundaries, thegreater their liability becomes.

Mr Duthie:

– That is ridiculous.

Mr McBRIDE:

– The Commonwealth. Grant3 Commission does not consider that, it is ridiculous, because it has assessed that position. For the information of theHouse, I shall point out the commission’s, assessment of the net value of production per capita in South Australia, a claimant State, and in New South Wales, a nonclaimant State. The index figure of the value of production per capita in South Australia, in 1938-39 was 95 but in 1947-48 it had risen to 307, an increase- of more than 200 per cent. New South Wales is a very prosperous State, with large resources. The index figure of the value of production per capita in New South Wales rose from 96 in 1938-39 to 238 in 1947-48. The commission also takes as an economic indicator the revenues received from certain government services that are rendered to the people of the respective States. The Prime Minister not long ago criticized very harshly the Premier of South Australia because he had refused to increase railway freights. The index figures for revenue received by the South Australian railways were 99 in 1938-39 and 190 in 1947-48, an increase of 100 per cent., whereas the index figures for the earnings of the New South Wales railways in the corresponding years were 102 and 158, an increase of only 50 per cent. That does not suggest that the Government of South Australia has been remiss in the matter of freights and fares. We know that the Postal Department has recently increased charges, because it has -been found impossible to make the department pay under Labour administration, but even before the increase was made, postal revenue in South Australia had increased from an index number of 104 in 1938-39 to 190 in 1947-48, an increase of 80 per cent., whereas in New South Wales it increased in the same period from only 105 to 185.

I mention these matters in order to show that the position of the claimant States is adversely affected by the present relations between the Commonwealth and the States. The greater the development that takes place in the States, the greater their financial responsibility becomes. I do not suggest that State budgets have increased to anything like the same extent as has the Commonwealth budget, but they have increased substantially. Commonwealth expenditure in 1942-43 was £210,000,000, while the estimated expenditure for the current financial year is £555,000,000. In the same period, the New South Wales budget increased from £65,000,000 to £96,900,000, and the SouthAustralian budget from £14,000,000 to £22,000,000. The States have had to rely more and more on Commonwealth bounty in order to finance their activities. This has been recognized by the Commonwealth because, under the vicious uniform taxation system, the Commonwealth has made some reimbursements to the States. The system was introduced in 1942, and the first reimbursements were made in 1943, when New South Wales received £11,000,000. In 1949, New South Wales received £21,900,000. In 1943, South Australia received £2,300,000, and this year the amount was £4,600,000. The amount by which the claimant States have been reimbursed has been inadequate to meet their needs. It is common knowledge that, during the war, New South Wales was able to accumulate surplus revenue amounting to more than £10,000,000, because many governmental activities had at that time to be curtailed. However, at no time, even during the war, were the claimant States able to accumulate reserves of that kind. Always it was necessary for them to obtain grants from the Commonwealth through the Commonwealth Grants Commission, and the grants have varied considerably from year to year. In 1942, the year that uniform taxation came into force, South Australia received through the commission, £1,150,000. In the following year, presumably because the Government had been unable to expend all its revenue, the grant was reduced to £800,000. In 1944, it rose to £900,000, and it was not until 1945 that the grant exceeded that of 1942. Figures for the various years are as follows : -

The amount recommended for the current financial year, and accepted by the Government, is £4,174,000. Notwithstanding the substantially increased grant, the Premier of South Australia has this year budgeted for a deficit of £280,000, which will be increased as a result of the devaluation of the currency. The Premier has announced that devaluation would cost South Australia approximately £150,000. Honorable members must understand that, when the sources of State revenue are so severely limited, the States must go to the Commonwealth for help when any unforeseen commitment arises. The Commonwealth Grants Commission takes into account the amount of tax reimbursements from the Commonwealth when recommending the grants that are to be made. Thus, while the present financial relations between the States and the Commonwealth exist, the Commonwealth grants to the claimant States must continually increase.

I am not opposed to this bill, which meets the known needs of the claimant States. That, at any rate, applies to South Australia, the State I know best. As I have said, any unforeseen commitment, such as the devaluation of the currency, or a new award by the Commonwealth Arbitration Court, might compel the claimant States to approach the Commonwealth for further relief. This system, under which the States must come to the Commonwealth year after year for assistance cannot but engender a feeling or irresponsibility among State Ministers. That is not a satisfactory state of affairs in what are supposed to be sovereign States. I hope that the problem will be solved in a way that will relieve the Commonwealth of some of its liabilities, and put greater responsibility on the States themselves.

Debate (on motion by Mr. Sheehy)

Adjourned.

page 1800

ADJOURNMENT

Armed Forces: Australians in Timor.

Motion (by Mr. Scully) proposed -

That the House do now adjourn.

Mr HAMILTON:
Swan

.- I wish to bring before the Minister for the Army the claims of members of the 2nd/2nd Commando Squadron, which served on Timor during the war, for subsistence payments in respect of the time they spent on the island. They were there from February, 1942, when the enemy landed at Dilli, and they were unableto establish contact with the Australian mainland until the 20th April of that, year. However, even had they made contact, it would have been impossible to get any considerable quantity of supplies to them because enemy forces were in command of all communication routes. The enemy landed in February, 1942, and it was no; until the 3rd June of that year that supplies of any kind arrived for our troops. The supplies were unloaded during tuc night of the 3rd June, and consisted of ammunition and medical supplies in the main, together with a limited quantity of flour and sugar. No one would claim that flour and sugar constitute a sufficient ration. As a consequence, the troops were forced to live off the country, and they experienced difficulty in doing even that. Rations did not reach men in the forward areas until the 15th June, so that the men were without rations from the 19th February until the 15th June, about 120 days. The diaries in possession of this unit’s association afford ample evidencethat the rations were never at any time sufficient to feed the troops, most of whom had to live off the country. In the claim which they put forward, the following passage occurs : -

The nature of our work and the terrain are two of the few factors which show how impossible it was for the army to completely or even, partially ration our unit. To maintain a permanent nation food dumps should have to be made, and men would have to be left behind to guard them.

Sections were continually on the move and continually being forced out of their areas by enemy pressure, food in dumps would havebeen another method of feeding the enemy, besides - men to act as a guard on these dumps could never be spared as we were always at least 50% under strength.

Overland transport facilities also made it impracticable for troops to be continually supplied with rations. For transport it was necessary to rely entirely upon the natives and at any time the enemy brought pressureto bear on us, natives would go into hiding hence no transport facilities.

Army head-quarters have claimed that rations were being supplied or money dropped by parachute to the troops for the purchase of food. It appears, from information in the hands of the organization that the amount received by this unit amounted to only ls. a man each day, whereas the nominal cost of rationing was 2s. 3d. a day. Even out of that ls. a day, troops had to pay for labour, espionagework, &c. The communication that I have received from the president of theorganization states -

Out of this rate of ls. per man per day, many other items had to be paid for. Never at any time was separate funds sent to coverlabour expenses, espionage. Labour expenses covers a multitude of items: - hire of horses, native runners, guides to mentiononlya few.

Because of the nature of the warfare espionage was an important part of our “set up”.Every raid and ambush which took place was the result of information received from paid spies. A classical exampleisthe death of the notorious Singapore Tiger” (Jap. Captain). Information from paid spies told how he was boasting of the deeds he would instigate against the Australians. They also told the route he would take and the date he would use this route. An ambush was set andconsequently “The Tiger “ was eliminated.

The troops had to take up collections amongst themselves. They got money by selling wallets and other articles to the natives or any one in the vicinity, including, I believe, Chinese. The communication adds -

We have in our possession a receipt for £10 issued by a Troop commander and the Rationing Officer of the unit, in August 1942. This receipt was issued to a member of a section for money he gave to the rationing officer to buy food with. At the same time, there were two other receipts issued to individuals for the same reason, one for £15, a nother for £20. These latter two are probably still in existence but so far the individuals concerned have not been contacted.

In the following month another collection was organized and the result was £70 handed to the rationing officer.

The other two receipts may not bein existence now, but the organization has the receipt from the rationing officer. It claims that the Department of the Army owes the troops for 130 days at 2s. 3d. a day, when they were unable to establish contact with Australia, and180 days at1s. 9d. a day, the difference of fid. being the 50 per cent, of the1s. that the men were able to collect from parachutes but which was paid out for services mentioned previously. They were paid £6 6s., leaving a balance of £34 10s. 3d. The 2nd/2nd Commandos did a wonderful job on the island of Timor. They battled their way through and succeeded eventually in leaving the island on the 17th December, 1942. The men whose claim I am putting forward are the “Western Australian members. Strangest of all, the Tasmanian members were paid £32, compared with only £6 6s. paid to Western Australians. The Tasmanians, having received 80 per cent, of their claim, are not agitating for more recompense, but the Western Australians claim at least the same treatment as was given to the Tasmanian members of the unit.

Mr Scully:

– Hasthe honorable member brought this matter to the notice of the Minister for the Army?

Mr HAMILTON:

– No, but negotiations have been going on since 1947. I understand that the matter has never been raised in this House. It was, however, placed by the Returned Sailors, Soldiers and Airmen’s Imperial League of Australia and by the President of the 2nd/2nd Commando Association before the Minister for Defence (Mr. Dedman) who got in touch with the Minister forthe Army. I gave the Minister for the Army plenty of notice that I intended to raise it on the adjournment to-night, andI am sorry he is not here, but I have with me a sheaf of correspondence between the Department of the Army and the Minister for the Army and the Returned Sailors, Soldiers and Airmen’s Imperial League of Australia. After the Minister for Defence had made representations to the Minister for the Army he wrote to the President of the 2nd/2nd Commando Association in Perth in the following terms: -

Mr. Chambers has pointed out that the evidence put forward by you does not raise any new factors justifying an alteration of the decision already made. He adds that the payments made to the Tasmanian members of the 2nd/2nd independent company, were incorrectly authorized by the District Finance Officer in Tasmania. Following this mistake it was later decided that under the circumstances, no action would be taken to recover the amounts incorrectly paid, however, Mr. Chambers emphasizes that the mistakes made in thecase of Tasmanian members cannot be considered as a justification for a similar payment to West Australian members of the Unit.

I claim that no mistake was made.I have proved that none was made. The organization has the evidence. It can supply it in the form of personal diaries and official receipts from the rationing officer of the troops. The evidence proves conclusively and plainly that each of them is entitled to £40 16s. 3d., of which they have received only £6 6s. I do not say for a moment that the Tasmanian members should refund the money if a mistake has been made. If a mistake has been made, it shows what has been going on. The claim is justifiable. I have raised it at this late hour and at this late stage in the Eighteenth Parliament in the hope that the Government will reconsider it. Even if what is claimed by the department is correct, in view of the evidence that the organization possesses to prove its bona fides, the matter should be opened up again and justice should be done. I repeat that the men did a wonderful job in Timor. When the enemy landed on 2nd February, 1942, they were forced into the scrub and had to rely on their ingenuity and initiative. They eventually got into touch with Darwin on the 2nd April. The outcome was meagre supplies of flour and sugar. Otherwise the men had to fend for themselves and live off the country. It is neither just nor fair that the men should have to stand the rap for all time. While their claim remains unsatisfied it is a blot on the Australian community. The Government must reconsider the matter.

Mr SCULLY:
Vice-President of the Executive Council · Gwydir · ALP

– in reply - I do not know the facts of the case raised by the honorable member for Swan (Mr. Hamilton), but I shall bring the honorable gentleman’s remarks to the notice of the Minister for the Army (Mr. Chambers) for his consideration.

Mr WHITE:
Balaclava

.- I support what has been said by the honorable member for Swan (Mr. Hamilton). It is a much better case than it may appear to be from being brought up at this late hour.

Mr DEPUTY SPEAKER (Mr Clark:

– Order ! I am informed that the. Vice-President of the Executive Council (Mr. Scully) moved the adjournment of the House and, that being so, when he spoke, he closed the debate.

Mr Scully:

– I am sorry.

Mr White:

– I rose when the VicePresident of the Executive Council rose.

Question resolved in the affirmative.

page 1802

PAPERS

The following papers were presented : -

Commonwealth Public Service Act - Appointments - Department of Health- A. P. Crawcour, C.E. Eddy, H. R. Peisley, S.O. M. Were.

Defence Act - Regulations - Statutory Rules 1949, No. 70.

Defence (Transitional Provisions) Act - National Security (Rationing) Regulations - Orders - Nos. 163, 164.

Northern Territory (Administration) Act - Regulations - Statutory Rules 1949, No. 77.

House adjourned at 11.24 p.m.

page 1802

ANSWERS TO QUESTIONS

The following answers to questions were circulated.: -

Currency : Tractors

Mr Fadden:

n asked the Minister representing the Minister for Trade and Customs, upon notice -

  1. With reference to the allocation of approximately 9,000,000 dollars for the importation of about 1,000 crawler tractors and 2,000 wheel tractors, will he indicate (a) if any of those tractors have yet reached Australia, and (b) how many have been allocated (i) for Commonwealth Government use; (ii) for use by primary producers, and (iii) for use by other individuals or bodies?
  2. Of the 5,000,000 dollars allocated for tractor replacement parts, what proportion is intended for the purpose mentioned in (i), (ii) and (iii) ?
Mr Pollard:
ALP

– The Minister for Trade and Customs has supplied the following information : - 1. (a) Yes. Four hundred and sixty-eight crawler tractors and 2,932 wheel tractors of United States of America origin have been landed during the period January-August, 1949, of which 109 crawler and 468 wheel have been imported against 1949-50 budget. Fifty per cent, only of the tractors programmed for 1949-50 licensing year were licensed during the six months’ period April-September, 1949. The balance will be licensed during the six months commencing the 1st October, 1949; (?>) The Commonwealth no longer controls distribution of tractors in Australia, consequently tractors have not been allocated by the Commonwealth for any specific use.

  1. Tractor replacement parts are intended for servicing all tractors in Australia. Parts are imported in bulk by tractor distributors in all States and no attempt has been made to determine proportion for use for any specific purpose.

Wire Netting

Mr Fadden:

n asked the Minister representing the Minister for Trade and Customs, upon notice -

  1. Has any Australian -made wire netting been exported since 1945?
  2. If so, what were the quantities involved and to which countries were the exports made?

Mr. POLLARD - The Minister for Trade and Customs has supplied the following information: -

  1. Yes.
  2. Exports of Australian-made wire netting

Cite as: Australia, House of Representatives, Debates, 20 October 1949, viewed 22 October 2017, <http://historichansard.net/hofreps/1949/19491020_reps_18_205/>.

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