20th Parliament · 1st Session
Mr. Speaker (Hon. Archie Cameron) took the chair at 2.30 p.m., and read prayers.
Sydney “Sun” Newspaper Report.
– I desire to raise a matter of privilege in respect of an article that was published in aSydney newspaper of yesterday’s date. I direct the attention of the House to that article which I consider to be a vicious and unwarranted attack upon members of the Parliament by a section of the press. The article is a studied insult to honorable members. It attributes to them practices of greed and selfishness. I believe that every honorable member will resent it, particularly as it was published in one of the leading journals of this country. In raising this matter I am not actuated by any desire to do harm personally to the author of the article. I direct attention to it in the interests of honorable members themselves who, in view of the fact that they will be judged by many people on its contents, have just cause to complain about itspublication. The article attributes to honorable members selfishness and bad manners. Such a malicious article calls for our urgent consideration.
The article was published on page 12 of yesterday’s edition of the Sydney Sun, and its authorship is attributed to Alan Reid, chief of the Sun’s Canberra bureau. The article mentions unsavoury practices. The first paragraph reads -
Just as a man may admire the functional utility of a zoo without becoming too fond of the animals that inhabit it, he can respect the Parliamentary institution without heroworshipping individual members.
I submit that honorable members cannot allow language of that kind, which is typical of the tone of the article, to go unnoticed because they must have some regard for their good name and their standing in the eyes of the community as a whole.For that reason the House should examine many of the statements contained in the article. For instance, the author states -
Members could cart away from the Parliament unlimited quantities of beer, whisky and cigarettes.
He added that members consider Parliament as a club and not as a working establishment. Another passage in the article reads -
Non-members were issued with a pink rationing ticket entitling them to twenty cigarettes a week.
The writer added that members have no control operating, nor have they on Sundays. In order that the matter may be fully considered in the interests of honorable members I move -
That the Committee of Privileges give early consideration to the comments by the Chief of the Sun Canberra Bureau, appearing in the Sun newspaper of the 2nd October, 1951, printed and published in Sydney, and report on -
the truth, or otherwise, of the impressions conveyed by the article;
the privileges extended by the House Committee to the writer of the article, and to all others who work within the precincts of Parliament House ;
the wisdom or otherwise of continuing the extension of privileges to others than members of the Parliament.
The Sun newspaper in which the article appeared, is printed and published at 60-70 Elizabeth-street, Sydney, by Associated Newspapers Limited. I am a member of the House Committee, which believes that everything has been done in the interests of all sections who use Parliament House, and I point out that the committee has given instructions, and believes that such instructions have been carried out, that matters are to bo conducted in such a way as to assist, and to show consideration for the feelings and comfort of all who use this building. I hope that an inquiry by the Committee of Privileges will include a check on the decision of the House Committee. The last paragraph of the article states that only members have privileges in Parliament House, although we have extended them to others.
It is stated maliciously in the newspaper article to which I have referred that honorable members are not issued with pink ration tickets, as are members of the staff, and may draw what they like from the bar. I remind the House that the pink tickets were introduced at the request of the pressmen themselves. So great was the demand for cigarettes at the week-end by the 350 persons to whom we extend the ‘privilege that they asked for the introduction of a rationing system in order to ensure a fair distribution of cigarettes. The result was that the management of the refreshment rooms issued the pink tickets to the persons who were entitled to use the staff bar. Ration tickets have not been issued to honorable members, who use their own bar, because the need for rationing supplies to them has not arisen. All honorable members do not avail themselves of the privilege of purchasing their requirements from the members’ bar, and, of course, the 60 honorable senators aud 123 members of the House of Representatives arc greatly outnumbered by the staff who use the other bar.
We have extended to employees of the Parliament and to pressmen the privilege of using the staff bar. It is a privilege that sometimes leads to licence. An unfair writer could make it appear to the public that we do not pay for our purchases, and that the cost is borne by the public purse. Many other unfair insinuations of that kind which have been made in the past have been corrected. For many years, this privilege has been respected by the press. The president of the press gallery has interviewed the Joint House Committee whenever the necessity has arisen for him to do so, and his requests have always been considered. Honorable members have not an exclusive club in this building. As I have stated more than 350 persons are entitled to obtain their meals in the parliamentary refreshment rooms to the extent of 400 services daily, and the men are permitted to frequent the staff bar which has been provided for them. They pay the same prices as are paid by honorable members not only for meals but also for drinks. “We extend to members of the staff and to pressmen the privilege which the writer of this article has claimed some honorable members have. It was wickedly stated that honorable members were running through King’s Hall with bottles of beer and whisky ‘ under their arms last week-end. I did not see such an occurrence. I do not know any one who did such a thing. But honorable members are entitled to do it in the same way as members of the press, of which the writer of this article is one, are entitled to do it and most would require lo pass through King’s Hall. Provision has been made ‘ for cigarettes to be available each weekend to the hundreds who frequent the staff bar, and they all may draw, when available, between four and six bottles of beer a week to take to their homes at week-ends. They pay the same prices for their liquor and cigarettes as are paid by honorable members. The young ladies, the gentlemen of the press, ministerial staffs and parliamentary officers who come within the jurisdiction of the President and Mr. Speaker, are grateful for the privileges which honorable members have been pleased to extend to them. In view of all the circumstances. I consider that this scurrilous piece of literature should be examined by the Committee of Privileges.
– The honorable member must produce a copy of the newspaper article of which he complains. Is the motion seconded?
– I second the motion.
– I am singularly lacking in knowledge of the matter to which the honorable member for “Wide Bay (Mr. Bernard Corser) has referred, and I dare say that most honorable members are not aware of it. However, the proposal that the honorable member has made is that the Committee of Privileges, which is an all-party committee, should investigate whatever complaint there is, and I am sure that all honorable members will be agreeable to that course of action being taken.
– Hear, hear !
– Should it then be-, come necessary to discuss the matter, we can do so with knowledge of the investigations that have been made by the committee.
– I have read the article. It’ was discussed at some length to-day at a party meeting of the Opposition. I entirely agree with the Prime
Minister (Mr. Menzies). I think that there is a prima facie case of breach of privilege which demands inquiry by the Committee of Privileges. Therefore, the Opposition will support the motion.
Question resolved in the affirmative.
– Earlier this year I drew attention on a number of occasions to the importation into Australia, in prefabricated houses and timber parts for houses, of what is regarded as the world’s greatest timber pest, the sirex wasp. On the most recent occasion, the Prime Minister said that the question was considered to be of such national importance that it had. been decided that the conflicting evidence for and against the maintenance of quarantine protective services against the sirex wasp would be thoroughly examined by an impartial tribunal. I now ask the Minister for the Interior whether it is a fact that a recent shipment of some millions of feet of timber from Europe was found to be heavily infested with the pest when it arrived at Melbourne and that the ship was held up by the quarantine authorities. Has the committee that was foreshadowed by the Prime Minister met? What interests are represented on the committee? What decision, if any, has been made concerning methods of preventing the introduction of this European timber pest?
– I am not fully aware of all the facts concerning the recent shipment of timber to which the honorable member has referred, but I understand that a cargo of timber that arrived in Melbourne recently was infested with the sirex wast), and that appropriate action was taken by the quarantine authorities. In fact, this matter concerns the Minister for Health and the quarantine authorities, who are under his administration, more closely than it concerns me. as Minister for the Interior. I have no direct control over it. However, after the honorable mem.ber bad asked questions previously. I discussed the subject with the Minister for Health in the light of representations that had been mp de to the p +F. rt that the quarantine restrictions in Melbourne were much more severe than were those that were imposed in Sydney. The com- plaint was that the restrictions in Melbourne were so severe that they were seriously adding to the cost of imported timber because of the delays that were caused to ships. Whether that was correct or not I do not know, but the complaint was made very definitely that there was a difference between the handling of timber in Sydney and in Melbourne. As the action was taken by the quarantine authorities, I raised the matter with the Minister for Health, who, I understand, investigated it. As a result of the conference that took place between the health authorities and, I think, representatives of the Victorian Forestry Department, it was decided not to relax the strict regulations that were in force in Melbourne. I do not know whether the committee that was foreshadowed has met or whether the Minister for Health went into the matter and decided that relaxation was not necessary.
– Has the attention of the Minister for Health been drawn to the activities of the specialist medical committee with regard to the use of certain drugs as a cure for cancer? Is he aware that the tests that have been sponsored by the well-known Sydney philanthropist, Mr. E. J. Hallstrom, have so far shown great promise? If the Minister is not. aware of these matters, will he make inquiries to see whether the Commonwealth could assist in any way?
– If the honorable member will- acquaint me with ‘the names of the members of the specialist committee, I shall get in touch with them at once to see what is being done.
– Will the Treasurer advise me whether legislation to amend the Commonwealth Employees’ Compensation Act will be introduced during the present sittings of the Parliament?
– Leave to introduce a bill to amend the Commonwealth Employees’ Compensation Act was given by the House yesterday, and I shall present the measure to the House at a later hour to-day.
– I ask the Minister representing the Minister acting for the Minister for Commerce and Agriculture to say whether it is a fact that the retail price of sugar was increased recently from 5d. to 6£ per lb., an increase of 30 per cent., in order to give the sugarfarmer his cost of production? Did the Queensland Government ask the Commonwealth for a subsidy to prevent an increase of the retail price to the consumer ? Will the Minister say why there should be differentiation between the treatment of dairy-farmers, who are granted cost of production, and the sugargrowers ?
– The price of sugar is determined under an agreement made between the Australian and the Queensland governments. When it was ascertained by the sugar-growers’ organizations that their cost of production was much greater than the 5d. per lb. permitted retail price, the Queensland Premier led a deputation to the Prime Minister which asked that the. retail price of Sugar to the consumer should be increased by lid. per lb. No request whatever was made for a subsidy by the Commonwealth to provent a price increase. I cannot understand why there should be a differentiation of treatment of the dairy-farmers and the sugar-growers in Queensland.
– The question that I shall direct to the Minister for External Affairs relates to the recent incident when Professor Oliphant was either refused a vise to visit the United States of America, or the issue of a vise was delayed for so long that he could not attend an important conference. I think that the Minister was present on the 27th September when the Minister for Immigration undertook to look into this matter to see what had been done by Commonwealth officials. Will the Minister inform me whether it is a fact that the Australian National University authorities requested the Department of External Affairs or the Minister, or both, on behalf of Professor Oliphant, to make representations to the United States authorities, and whether action of any kind was taken in order to assist that application ?
– An application was made to my department by some one who was, I believe, acting on behalf of Pro’fessor Oliphant. Inquiries were made immediately by telegram through the Australian Embassy in Washington, with the result that the Minister for ‘Immigration conveyed to the House recently. There was an inevitable delay in investigating Professor Oliphant’s application for a vise because it took some time to consider security matters. Immediately a request was made to my department, inquiries were instituted. Professor Oliphant, or the person who made inquiries on his behalf, was then given all the available information. That was all there was to it.
– I remind the Minister acting for the Minister representing the Minister for Commerce and Agriculture that on several occasions I have made representations with regard to wool-growers who. participated in the Joint Organization scheme and have now left the industry. Will the honorable gentleman say whether any decision has been made to distribute accrued profits to farmers in that category?
– It is proposed to. refund to farmers in that category what is due to them under the Joint Organization scheme. That will necessitate an amendment of the relevant legislation. Arrangements for the payment of the refund cannot be made until the legislation has been amended. It. is hoped that the amendment will be made during the current sittings.
– My question, which is addressed to the Prime Minister, relates to Professor Hytten’* position on the National Security Resources Board. Has Professor Hytten yet prepared a report for the Government on the man-power position in the various State railways systems and in the Commonwealth railways system? Can the Prime Minister indicate the scope of the authority, if any, that is exercised by Professor Hytten on the National Security Resources Board in relation, first, to the quantity and quality of coal supplied to the various railways systems of this country, and, secondly, to ways and means of attracting man-power to the running grades in the railway services? > Mr. MENZIES.- Professor Hytten is not a member of the National Security Resources Board. Therefore, he performs no functions in relation to that board. He was appointed by the Commonwealth as chairman of a committee that is investigating transport matters. The Commonwealth and the States are represented on that committee. The honorable gentleman will recall that, by arrangement with the Premiers of the States, the Commonwealth established committees to deal with power, transport and other matters. A committee of the Australian Agricultural Council is considering agricultural policy. The ob;ect of the committees is to achieve the highest possible degree of co-ordina- tip n between the Commonwealth and the States in regard to certain works programmes. I cannot say offhand whether a. preliminary report has been, received from the committee of which Professor Hytten is chairman, but I can say that no final report has yet been received from it. The committee is still sitting.
– I ask the Minister representing the Minister acting for the Minister for Commerce and Agriculture whether stocks of wheat in New South Wales are at a low level, or whether deliveries of wheat have been delayed owing to inadequate transport facilities? Are there only 2,700,000 acres under wheat in New South Wales this year, compared with 4,000,000 acres last year and 5.0O0.O0O acres a few years asio? Is Australia heavily committed, under the International Wheat Agreement, to supply wheat to other countries? Can anything be done to encourage first, wheat production, and, secondly, the production of other grains such as maize, linseed and grain sorghum ? I point out that poultryfarmers are experiencing Treat difficulty in obtaining supplies of wheat. : Mr. ANTHONY.- It is true that Australia is committed to certain quotas under the International Wheat Agreement. I do not know whether we shall be able to fill our quotas during the current season. I >am not aware of the extent of the decline of the acreage under wheat in New South Wales, and I am unable to answer offhand the other matters’ referred to by the honorable member. However, I shall endeavour to obtain the necessary information for him.
– Will the Minister representing the Minister acting for tha Minister for Commerce and Agriculture say whether the Government has given consideration to the making of a further payment to wheat-growers from the fund established under the Wheat Industry Stabilization Act? If the Government has not given consideration to that matter, will it do so in view of the fact that the fund has now reached a figure far ia excess of requirements ?
– I shall bring the honorable member’s question under the notice of the Minister acting for the Minister for Commerce and Agriculture and shall let him have a reply to it.
– Has the attention of the Minister representing the Minister acting for the Minister for Commerce and Agriculture been drawn to a statement made some days ago in Brisbane by Mr. Gair, the Acting Premier of Queensland, to the effect that the Australian Government had refused to pay the freight charge of £50,000 for the shipment of 300,000 bushels of South Australian wheat to Queensland, although he understood that the Government was meeting the freight on gristing wheat shipped to Tasmania from South Australia? Will the Minister say whether that .statement is correct or not?
– I am unable to say whether the Acting Premier’s statement is correct, because I have not seen it. However, I shall have inquiries made and shall endeavour to let the honorable member have the facts.
– I preface a question to the Treasurer by stating that in common with other honorable members I received from toy manufacturers representations concerning the budget in its relation to sales tax. Those representations were to the effect that toy manufacturers should not be subjected to the proposed sales tax im- positions. Does the right honorable gentleman know how such persons knew beforehand that they were to be singled out for the imposition of increased sales tax?
– I do not know how any one became aware of what the budget would contain, but I remind the honorable member that it is impossible to prevent anticipation and speculation.
– Has the Treasurer seen reports that cheques sent out by the Taxation Branch for refunds due to taxpayers have been lost in the post, and have subsequently been cashed? Will he institute an investigation with a view to protecting the interests of taxpayers to whom refunds are due?
– I shall inquire into the matter and advise the honorable member later.
: Mr. FAIRHALL.- Is the Minister in charge of the Commonwealth Scientific and Industrial Research Organization aware that it was recently reported that Dr. E. G. Bowen, chief of the Radio Physics Division of the Commonwealth Scientific and Industrial Research Organization, has been the recipient of a high American honour because of his outstanding contributions to scientific air navigation? Could the Minister outline the details of Dr. Bowen’s work and perhaps place on record the congratulations of the Government on his success?
– It is true that Dr. Bowen, the chief of the Radio Physics Division of the Commonwealth Scientific and Industrial Research Organization, was awarded the Thurlow Medal by the American Institute of Navigation, principally for the development of a piece of completely new and unique navigation equipment, used, largely for aircraft, known as distance measuring equipment or D.M.E. Such equipment, for the first -time, enables the pilot of an aircraft to !read, from a gauge in his .aircraft, the distance of the aircraft from the airfield i which it is approaching. Other related matters of radio equipment have been developed under Dr. Bowen’s auspices and have attracted very great attention overseas. They are unique pieces of equipment which reflect the fact that in certain directions the Radio Physics Division is leading the world. I should like to add my voice to the congratulations of Dr. Bowen on his success and I also wish to congratulate the Radio Physics Division. The equipment that has been evolved most certainly makes for greater safety in Hying and has attracted much favorable attention from interested authorities overseas.
– Will the Minister for Health inform the House whether it is correct that work on the new leprosarium at Darwin is to be suspended or curtailed ? If the report to that effect is correct, will the Minister state the reasons for the alteration of plans which were drawn up after careful investigation of the need for the proposed leprosarium in view of the unsuitability of the existing site?
– That matter has not been brought to my notice since my return from abroad, but I shall inquire into it straightaway.
– Has the Prime Minister conferred with the Australian Council of Trades Unions or the Glen Davis Citizens’ Committee concerning the closing of the Glen Davis shale oil refinery, and if so have his views changed concerning the need to continue that important industry? I further ask the right honorable gentleman whether a special committee has been appointed to investigate the industry. If it was appointed, what were the nature of it9 investigations, and has a report been submitted by it? Did it take into consideration involved problems overseas, particularly in relation to Persia, and other difficulties in connexion with oil that exist in our near north? Has consideration also been given to the great suffering which will bo caused through the closing of the plant to about’ 3,000 people who have sunk their assets in establishing the shale oil industry in the Blue Mountains?
– I have not. conferred with either of the bodies to which the honorable member has referred. This matter is in the hands of the Minister for National Development who recently made a statement in respect of it. It has also engaged a great deal of attention in the Cabinet, where the various circumstances mentioned by the honorable member were fully canvassed. I shall, however, direct the attention of my colleague to the honorable member’s question,’ and if some further information is necessary T shall get him to provide it.
– Will the Treasurer say whether there is any agreement, express or implied, for the freezing of Australia’s sterling credits in London or. of any portion thereof? Is any interest or other charge payable on the amount of such credits outstanding in order to offset Australia’s annual interest bill of £12,000,000 payable on overseas loans? In view of the fact that our overseas credits are now approximately double the amount of our overseas debts, does the Government intend to utilize any of such credits for liquidating our overseas liabilities, either by paying off the loans when due or by buying in the bonds on the market, in the case of long-term loans outstanding?
– I will treat the honorable member’s question as if it were on the notice-paper and answer it accordingly.
– Apropos of a recent case in which certain Communistcontrolled trade unions challenged in the High Court the validity of the Communist Party Dissolution Act, does the Prime Minister yet know whether the costs against the Government are in the hands of the taxing officer of the High Court? If they are, will the Prime Minister state the amount in those costs covering the fees of the right honorable member for Barton (Dr. Evatt) ? If they are not, will the Prime Minister supply this information to the House when the costs are available so that honorable members and the public may know whether the right honorable member for. Barton performed his task for love or for money?
– I do not know whether the costs have yet been put in, but I shall find out.
– I wish to ask the Postmaster-General a question about country mail contracts. Many current contracts were entered into as long ago as July, 1947, since which the cost of maintaining services has greatly increased. The cost of running and maintaining motor vehicles is higher now, and motor tyres are dearer, with the result that some of the mail contractors are actually losing money. Will the Minister consider affording such contractors financial assistance to enable them to complete their contracts?
– Thousands^ of such contracts- have been entered into by country operators, and, as the honorable member has pointed out, the cost of providing the services, including the cost of running and maintaining motor vehicles, has increased considerably since the contracts were signed. The department is now faced with the problem of how to deal with the situation. If it were to grant an overall increase in payments to the contractors, it would create fresh anomalies. What the department is prepared to do, and what it has done and is doing in many instances, is to give contractors the option of surrendering their contracts. When any contractor does so the department will then call for fresh tenders so that the old contractor may submit a new price in competition with others.
– As the season is now suitable for the spreading of the rabbit-killing virus, myxomatosis, will the Minister in charge of the Commonwealth Scientific and Industrial Research Organization give an assurance that every possible means will be used to spread the disease on as wide a front as possible ? Will he also assure honorable members that he will proceed actively with the campaign whether the .Chief Secretary of New South Wales attempts to prevent it or not ?
– Yes, a very vigorous campaign has already begun for. the spreading of myxomatosis throughout Australia on as wide a scale as possibleAll the State Governments on the mainland are co-operating, but not, so far, the Government of Tasmania. Tens of thousands of doses are going out daily, and it is hoped that the campaign being conducted this summer will form the basis of a continuing longrange attack on the rabbit pest by means of myxomatosis. Let me. take this opportunity to repeat a statement that has been said many times before. A great deal of experimentation- has established the fact that there is no danger to any other animal, domestic or wild, or to man, in. the use of the myxomatosis virus; nor is there any connexion between encephalitis and myxomatosis. These matters have been investigated by the highest authorities in Australia through experiments over considerable periods. I have it on the personal authority of Sir Macfarlane Burnet, a world authority on virus diseases, that the facts are as I have stated them.
Formal Motion1 for Adjournment
Mr. SPEAKER (Hon. Archie
Cameron). - I have received from the honorable member for Lalor (Mr.
Pollard) an intimation that he desires to move the adjournment of the House for the purpose of discussing a definite matter of urgent public importance, namely -
The failure of the Government to honour its election promises to the dairying industry.
– I move -
That the House do now adjourn.
– Is the motion supported ?
Eight honorable members.- having risen in support of the motion,.
– I have, moved’ this adjournment motion because* I have always considered that, nothing shakes the faith of the people of Australia or of any other democracy more than the failure of a political party or aparliament, or, more importantly, of a government, to honour election pledges which have apparently been made with a full sense of responsibility and with the full knowledge of the probable outcome of those promises when brought to their ultimate fruition. The subject of the promises that have been made by the Government to the dairy industry has a comparatively long history. The first step towards placing the industry on a better economic basis than it ever enjoyed before was taken during the most difficult period in our history - from 1941 to 1945, when the Curtin and Chifley Labour Governments provided a medium by which the dairy industry could receive at last the recognition due to it for services rendered to the people of th:s country and of other parts of the world. While even that assistance was not all. that could be desired, at least it was the first definite and satisfactory approach that had ever been made to this problem in the Commonwealth of Australia. After the cessation of hostilities, in 1947, the Chifley Labour Government for the first time in our history went so far as. to guarantee to the dairy industry the cost of production as assessed by the Joint Dairying Industry Advisory Committee which had been established by it. The fact that that Government honoured its promise to abide by the findings of the committee cannot be questioned. It is true that, after the defeat of the 1948 prices referendum the Chifley Government declared that because control of prices had passed from the Commonwealth to the States the increased cost of production as determined by the committee should not be met by the payment of a Commonwealth subsidy. I make that admission frankly because I believe that the truth should always be told.
I emphasize that we were in no way responsible for the defeat of, the prices referendum which deprived the Australian Government of its war-time power to control prices in the interests of the. people. We believed that the price increase should be passed on to the consuming public and we so advised the prices commissioners and the State governments, through Mr. Finnan, the chairman of the committee of State Ministers in control of prices. The former Treasurer, the late Mr. Chifley, and I,. after innumerable conferences with Mr. Finnan, tried to -persuade the States to accept responsibility for the price increase of 2 1/2 d., which would have honoured the guarantee that we had given at that time. When we failed to achieve our objective we endeavoured, as the present Government has done, to get the States to accept responsibility for the increased price. When we were thwarted in that attempt we honoured our promise to the dairyfarmers of Australia and made a payment to them of the increased cost of production retrospective to the date upon which it had been determined by the committee, that is, for a period .of six months, leaving a decision on the ensuing six months to the incoming Government. We did not offer a bribe to the electors by stating that we would continue the payment for the ensuing six months. It would have been very convenient for us .to have said, “ We will pay the increased price up to the end of 1950”. Had we done so we should have been assured of the full support of the dairy-farmers. I need not remind honorable members that it is not, and it has never been, the habit of the Australian Labour party, as a party or a movement, or as a responsible government, to make promises to the electors which, we may not be able to honour. We continued the payment of the guarantee up to the date upon which we relinquished office.
Despite the difficulties with which the then Opposition parties were confronted - they were particularly well known to the present Minister for Commerce and Agriculture (Mr. McEwen) - in a joint policy speech they promised the dairy-farmers that if they were returned to office they would extend the period of guarantee for ten years. Does any honorable member opposite dispute the accuracy of that statement? I observe that silence reigns supreme. There is no word of denial from the Government benches. If honorable members on the Government side think that what I have said is not correct, I shall remind them of the policy speech delivered by the Prime Minister (Mr. Menzies) in November of 1949. He .said, inter alia -
We support the long-term stabilization of the dairying industry for ten years by .subsidy where price is not raised.
The only authorities who could raise the price of dairy products were the State Government authorities. The State authorities for a long time adopted the same attitude to the Menzies Government as they had adopted to the previous Labour Government. They refused to raise prices. ‘Then this Government, although it had said that it would raise the guarantee to farmers by price or subsidy, then said that the subsidy method was too .expensive and that the whole system had become so extravagant that it would repudiate its promise to the dairying industry of Australia. Ever since then, within .this Parliament and outside of it, the voices of Government supporters have been raised in an endeavour to fasten on the respective State governments the responsibility of ensuring ,an adequate return to dairy-farmers. The members of the present Government made their promise at a time when they knew the effect of rising prices on the cost of production of butter. They knew also at that time, 1947, that they had destroyed the federal prices control system and were completely incapable of putting value back into the £1. Yet they repudiated what was thought at that time by the electors to be the promise of an honorable combination of political parties. Does anybody deny that? Silence again! In 1949, the Treasurer (Sir Arthur Fadden), famous for his broken promises, said in his policy speech -
To stabilize the wheat, dairying and other primary industries, we favour payment to producers of incentive guaranteed minimum prices for at least ten years.
What did he mean by that statement? If he and his supporters favour that procedure, then they are the people who should carry it out. But they did not do it. Now you quibble-
-Order ! The honorable member must address me.
– I am directing my speech to you, Mr. Speaker, but when I made the last remark I was not looking nt you. The same Treasurer, the advocate «f low taxation and the abolition of the sales tax, went still further. After referring to alleged failures of the Labour Administration in relation to the dairying industry, he said -
To remedy this we will determine production costs on just basic prices which will give the farmer a fair return for his labour, investment and long hours of work, and an incentive to producers on a sound and equitable basis.
Now, I believe in being straight and honest–
– Then why is the honorable member not frank and honest with the House?
– If the honorable member for Mallee (Mr. Turnbull) will possess his soul in patience for a short time he will discover how frank and honest I am being. There has been some criticism of the basis on which the guaranteed cost arrived at by the Labour Government was founded. “With the effluxion of time some of that criticism has been found to have been justified. I understand that this year the Minister for Commerce and Agriculture has agreed to adjust the basis on which the dairying industry costs are founded. I do not disagree with that, but of what use is a new basis if subsequently the promise to the electors and the industry will be repudiated? Yet the Government has repudiated its promises. When he was challenged with repudiating his promises, the Minister for Commerce and Agriculture in a. most involved statement delivered towards the end of the last sessional period endeavoured to wriggle out of his promise to the industry. I intend to quote his exact words,
-Order ! The honorable member may not quote from Hansard for the current session.
– I shall inform the House of the terms of the basic statement. He said that the Government believed in the guaranteed price system for the dairy industry, and that costs should be founded on the basis of a 40-hour week with a managerial allowance for the farmer which should be higher than 25a. a week. He said that effect could be given to that principle only if the States would agree to legislation which would raise the price of dairy products to the consumers. He made that statement notwithstanding the fact that he, as a responsible Minister, and no doubt one of the framers of the Government’s rural policy, had made an unconditional promise to the electors. Unfortunately the Minister is usually absent when we want to say something nasty to him. At present he is overseas trying to fix something, but I do not think he has ever fixed anything overseas that a Labour Government was not able to fix by telephone or cable. When in Opposition in this Parliament, the Minister asked for an assurance from the Labour Government that promises made to dairy-farmers would be honoured, and that the recommended price increase would be paid out of Consolidated Revenue. That was done by the Labour Government. We honoured our promises. We did not commit ourselves six months ahead to bribe the electors in the dairy industry. The present Minister for Commerce and Agriculture had no hesitation in asking at that time that butter producers be paid an increased price out of Consolidated Revenue; but this Government, which, like the Labour Administration, has failed to secure agreement amongst the State Ministers in charge of prices has sought to divert the attack to the so-called “ responsible “ States. Two States have refused to co-operate.
What will be the effect of the Australian Government’s broken promises and its endeavour to lay the blame on the States? Broken promises can only mean that the electors will lose their faith in political parties, in parliament, and in democracy itself. Dairymen are being discouraged and industrial unrest is evident, particularly in New South Wales. Who can blame the miners for “ jacking up “ on work when they cannot get butter for their sandwiches? The limited supplies of butter that are available in New South Wales are going to the strongest and the most unscrupulous. A similar situation exists in Queensland. [Extension of time granted.-] The weaker members of the community and those who, through lack of opportunity or because of their high moral principles will not buy on the black market, have no butter. In other words, the housewife with a large family is being deprived of a most nutritious food. The computations of the Commonwealth Dairy Produce Equalization Committee Limited which has rendered valuable service under the equalization scheme are being upset completely. The claim that responsibility lies with the State governments is entirely false and is made only to divert the attack on the Government. Full responsibility rightly rests on this Government. What happened when a price increase of 5.8d. per lb. was recommended by the Joint Dairying Industry Advisory Committee to tha Menzies Government?
– The Chifley formula.
– That was our guarantee and the Chifley Government honoured it, whereas the present Government has not honoured its guarantee to the dairying industry. Despite the fact that the McGirr Government of New South Wales gave no guarantee at all to the industry, it has increased the price of butter to the consumer by 6d. per lb. ; and I understand that the Queensland Government has taken similar action. The Australian Government would have taken appropriate action in this matter if it had shown some appreciation of the difficulties that now beset the people because of its failure to tackle the problem of inflation effectively. The Governments of New South. Wales and Queensland accepted the responsibility of increasing the price of butter although they had not entered into any contractual obligation to do so. However, those governments refuse to accept the altered basis on which this Government and, presumably, the Joint Dairying Industry Advisory Committee, have recommended an additional 3 1/2 d. per lb. to offset shorter working hours and higher managerial expenses in the industry and also as an. incentive to farmers to increase production. The Governments of New South Wales and Queensland said, rightly in my view-
– What about Tasmania?
– We know what Tasmania is ; it is a State dependent on loan money and State grants and it finds that it pays to be nice to the big bad wolf. The
Governments of New South Wales andQueensland refuse to accept the basis on which the additional 3M. per lb. is now being sought. It is this Government’s responsibility to make provision for that additional charge by the payment of a’ subsidy which supporters of the Government profess to believe in. The present Government parties, in their policy speech at the general election in 1949, declared - ‘
We support a long-term stabilization of the dairying industry for ten years (by subsidy where the price is not raised).
The Government has repudiated its responsibility in this matter and it is now endeavouring to shift that responsibility on to the State governments. I leave it to the House, the dairying industry and the people to contrast the way in which the Government has repudiated its election promises with the actions of the Curtin and Chifley Governments, which honoured every promise that they made. When those Governments found that they were unable to make promises because economic developments could not be f oreseen, they told the people that they would do the best they could. However, the people accepted the promises that the present Government parties made to them, and the difficulties that now exist in making available adequate supplies of butter in New South Wales and Queensland have arisen because of the fact that those promises were fraudulent.
– The Opposition should have spared the honorable member for Lalor (Mr. Pollard), who was Minister for Commerce and Agriculture in the Chifley Government, the ignominy of having to move this motion, because no member of the Parliament is more open to criticism in this matter than is the honorable member himself. He asked the House to contrast the action of this Government with that of the Government of which he was a member and to contrast the alleged repudiation by this Government of its promises with the way in which the Chifley Government had honoured its promises. I have in my hand a copy of Hansard of the 27th October, 1949, in which is recorded the last statement that the
Honorable member made in this House before the Chifley Government was ejected from office.- He then said -
In October, 1947, the Commonwealth Government announced its decision to guarantee the price of butter, cheese and processed milk products for five years from the 1st April, 1947.
Now, two years after he gave that guarantee, he has made the statements to which we. have just listened. He continued -
In the first half of 1948 the Joint Dairy Industry Advisory Committee-
Dr. Evatt interjecting,
– The Leader of the Opposition (Dr. Evatt) may well interrupt because he is the sinister figure behind all this; he is personally advising the Governments of New South Wales and Queensland to victimize the dairyfarmer in the way in which they are now doing. On the occasion to which I refer, the honorable member for Lalor continued -
In the first half of 1948 the Joint Dairy Industry Advisory Committee recommended an increase of price to the farmer of 2d. per lb. That recommendation was accepted by the Government and the Commonwealth Prices Commissioner approved appropriate rises of ret,il prices to consumers as from the 1st July, 1948.
The very first increase, that was. recommended by the advisory committee was passed on to the consumer by the Chifley Government. The honorable member continued -
A further review of costs made in April and June, 1949, revealed a further increase of 24d. per lb. to the dairy-farmer was warranted. In June, 1949, the Commonwealth Government referred the matter to the State Prices Ministers, informing them that it was prepared to continue the subsidy at the existing rate of fid. per lb. At those rates the cost of “the subsidy was £5,000,000 per annum.
– What is the Minister trying to prove ?
– I am going to prove that the honorable member for Lalor, who has submitted this motion, dishonoured the promise that he himself made to the industry two years ago. The honorable member continued -
To give the States additional time to consider the findings of the Joint Dairy Industry Advisory Committee and for an approach to secure an undertaking that the State Prices Ministers will give due consideration to the future findings of that body, the Government will pay to dairy-farmers by way of additional subsidy the increase of established production costs at the rate of 2£d. per lb. from the 1st July to 31st December, 1949.
Having delayed the matter for the best part of six months he announced on the last day of the life of the Chifley Government that an additional subsidy would be paid to the dairying industry until the following 31st December which, incidentally, was a few weeks after the’ general election which was held on the. 10th December of that year. The Chifley Government was prepared to live up to that promise only until that date. Furthermore - and this is important - the ink on the agreement had scarcely dried when the honorable member declared -
In the absence of such an understanding with the States, the Government feels that it would be futile for the. committee to continue to function.
The honorable member was going todissolve the committee which, in effect, was the dairy-farmers’ arbitration court. Had such action been taken, no means would have been available to the Government to determine a fair price to the industry. Yet, the honorable member now says, “ We honoured our promises “. He continued -
The Government would then be obliged to re-examine the position in the light of the circumstances obtaining.
Within two years of making his promise he repudiated it on the floor of this House. He said, not in so many words, but in effect, that he was not going to honour that promise ; but worse still, he said that he was going to dissolve the tribunal which was the only means of ascertaining the cost of production in the dairying industry. I shall show how this Government has honoured its undertakings. When we assumed office, our first action was to honour the obligation of 2-Jd. per lb. We did not make the payment to the 31st December, as had been promised by the honorable member for Lalor, but we continued it to the end of the financial year, which was the proper time. Subsequently, we granted increases of id., lid. and 2.17d. When we came into office the subsidy was 6d. per lb. To-day ls. lid. per lb. is paid in respect of every 1 lb. of butter that is passed over the counter. When the
Labour Government went out of office, th subsidy amounted to £5,000,000 per annum. It is now £16,800,000 per annum. ¥e contend that the subsidy is reasonable, and that it behoves the consumer of butter to pay to the producer a fair and reasonable price for his labour.
I desire to direct attention to the scandalous state in which the Chifley Labour Government left the dairying industry and to the meagre and parsimonious manner in which that Administration determined the cost of production. “When I was a member of the Opposition, I criticized the basis- on which the price of butter was determined. How was that figure ascertained in 1946-47, when the Labour Government was in office ? A dairy-farmer’s assets, such as his land and stock, were assessed at the values which were ruling in 1942, and were pegged at that figure, although every other section of the community was getting the benefit of the inflated costs of later years. The working week of the dairy-farmer was fixed at 56 hours. At that time, Mr. McGirr and Mr. Hanlon, who are now preventing the payment of an adequate price for butter in New South Wales and Queensland, declared that they would not allow their State employees to work more than 40 hours a week. Yet the Chifley Government considered that the standard working week for the dairy-farmers should be 56 hours. The reward of the ownermanager had then to be determined. After having gone into a huddle with the object of reducing the figure to as small an amount as possible, Labour Ministers made the reward for the owner-manager the same as the rate applicable to a leading dairy-hand plus 25s. a week. To cap it all, the committee which investigated the cost of production in that industry recommended that the dairy-farmer should be allowed an interest rate, or, if you like to use another word, a dividend rate of 4£ per cent, on this equity. On the basis of those calculations in 1947, the cost of production was determined at 2s. 1 1/2 d. per lb. Any one would have thought that, on that mean kind of assessment, no question would be raised about giving the dairy-farmer the amount of 2s. lid- per lb., but the honorable member for Lalor did not render to him even that measure of justice. He actually reduced the amount to 2s. per lb., and when I asked him in this House to explain the reason for such a reduction, he- replied that he had reduced the interest rate from 4£ per cent, on the farmer’s equity to 3 J per cent. He added that, in view of the fact that the dairy-farmer would be given a long-term guarantee, he was entitled to only that amount. The present Government has since done many things with the Joint Dairying Industry Advisory Committee.
The Premier of New South Wales, who has been telling a different story every week in an effort to evade his responsibilities, says that an amount of 3id. of the new price is an incentive payment which has been imposed by the Commonwealth. I shall show how that incentive has been calculated. It is perfectly true that if the committee had been working on the formula which had been given to it by the honorable member for Lalor, the increased price would be only 5.8d. per lb. We said that the first step was to assess the assets and stock of the dairy-farmer at 1950-51 values. Does any Opposition member assert that such a decision is wrong? I hear no reply. We then considered the standard working week for a dairy-farmer. He must tend his cows seven days a week, at least until a 40-hour week cow is bred. So far, that has not been achieved. We considered that an assessment should be m,ade on a basis of hours that would give him a reasonable remuneration for the time he worked. Accordingly, we altered the previous calculation, which was the wage of a leading dairy hand plus 25s. a week, to the figure of £800 a year in respect of a man who was operating a 50-cow farm. Do Opposition members question that decision? We also decided that the original interest rate of 4J per cent, should be restored. By those measures, we increased the rate that had been determined by the Labour Government from 5.8d. to 9-£d. per lb. I do not think that any individual in the community will challenge any one of those decisions.
Opposition members interjecting,
-Order ! I ask honorable members to cease interjecting. Two or three honorable members have been particularly offensive this afternoon. I ask the House to listen to the Postmaster-General in silence.
– The matter of the subsidy involves many considerations. I have attended many meetings of dairyfarmers, and I have not yet found one of them who desires the continuance of the subsidy system, or an increase of the subsidy. They realize that the political propping of their industry does not mean stability, but is the most dangerous thing that can happen to them. Overnight, as the result of a change of government, or a change of policy, the props might be pulled from under their industry, which could then be left languishing at the very time it would be impossible to increase the retail price of butter. All that the dairying industry asks is that the principle of supply and demand shall be applied to it, or reasonably so, as with every other industry in the community. Butter in New South “Wales and Queensland is now worth any price that the black market likes to ask tor it. According to my own information, and to statements in the press, butter in those States is bringing from 5s. to 7s. per lb. Have Opposition members compared the price of butter in Australia with the price of that commodity in other countries ? The following were the wholesale prices of butter a few months ago. I understand that they have been increased in the meantime: - [Extension of time granted.”]
The increase that has been, sought is justified by every examination of the position that has been made. I shall describe the exact situation in New South Wales and Queensland, and explain what the Government is prepared to do in order to stand rp to its guarantees of stability to the dairying industry. No such guarantee is given to that industry if it is to be dependent upon the whim of any political party that is in office for the time being. Every dairy-farmer is well aware of that fact.
Mr. Ward interjecting.
-Order! The honor able member for East Sydney must cease interjecting.
– Therefore, Mr. Speaker-
Opposition members interjecting,
– Order ! The honorable member for East Sydney interjected after I asked him to refrain from interjecting. I ask him to apologize for having done so.
– I interjected on only the one occasion.
– Order ! I heard the honorable gentleman more than once.
– I apologize.
– If there are any more interjections, I shall take action.
– The representatives of the dairying industry are very concerned that its financial affairs should be put on a basis of decency. They do not want it to be the kind of industry that is constantly appealing to the Government for bounties and subsidies - a dependent industry. It is an industry that can stand on its own feet by virtue of the merit of the product that it supplies to the public.
The Governments of New South Wales and Queensland are playing at politics of the very lowest order against the interests of dairy-farmers in those States. The governments of the other States asked this Government to meet a part of the increased cost, but, when we pointed out that we considered that we had gone far enough with a subsidy of ls. 1 1/2 d. for every 1 lb. of butter that was sold over the counter, a subsidy which costs the Treasury £16,800,000’ annually, and that the burden on the Treasury would be increased to £29,000,000 annually if we acceded to their request, they agreed to increase the price charged to the consumer by the amount that was necessary to provide a fair return to the dairy-farmer. That increase has been authorized in Western Australia, South Australia, and Victoria, and. also in Tasmania, which is under a Labour government. The Governments of New South Wales and Queensland are standing out for political reasons. I remind honorable members that when the Queensland Government, which is a co-partner with the Australian Government in the sugar agreement, wanted to increase the price of sugar by 30 per cent., which is the proportion of the butter price increase that is under discussion, it sent its representatives cap in hand to nsk us to pass the increase on to the consumers of Australia. We had power under the sugar agreement to refuse that request, and we could have played exactly the same kind of paltry game as the Governments of Queensland and New South Wales are now playing, but we acknowledged the merit of the case for the sugar producers, which was that production costs justified an increase of the retail price. Therefore, we had no hesitation about granting the request. But the Queensland Government apparently believes in one law for the sugar producers and another law for the dairy-farmers.
I need not cover the ground any further except to say that this Government has no intention to increase the butter subsidy beyond the present rate of ls. l£d. per lb.
– Now we have it!
– I notice that the honorable member for Eden-Monaro (Mr. Allan Fraser) is beaming across the table. If he wants to go to Bega, in the heart of the dairying district that he represents, and debate this issue with me I shall be only .too pleased to oblige him at any time. I have demonstrated that the Government has acted in a very reasonable way. It has made four or five separate increases of the butter subsidy. Time after time, on one pretext or another, the State prices authorities have evaded their duty to the industry. First, they declared that a price increase was not warranted because the difFerence between 5.8 pence and 9.5 pence per lb. would represent an incentive payment to the dairy-farmer. I have shown how that figure was determined. Anybody who accepts the standards of the former Labour Government in relation to the treatment of dairy-farmers might describe such an increase as a.n incentive payment, but every decent person will agree that the dairy-farmers, who work in an essential industry to produce a commodity that the community requires more urgently to-day than ever before, are entitled to receive from the “consumers a fair price for their product. This Government will do everything in its power to ensure that they shall get that price.
– I accept with very much pleasure the invitation of the PostmasterGeneral (Mr. Anthony) to debate with him at Bega the issues that are involved in this discussion, and I hope that’ this will be one promise made on behalf of the Government in relation to the dairying industry that will be kent. If the Postmaster-General would like to have some information about debating at Bega before an audience of dairy-farmers, he can obtain it from .the honorable member for Mackellar (Mr. Wentworth), who will assure him that such a debate will be very profitable to the dairy-farmers of the area. Even though the PostmasterGeneral was granted an extension of time so that he could complete his speech, he did not succeed in saying one word in answer to the charge that this Government has deliberately broken the pledges that it made to the dairying industry. Nor did he say one word in denial or in defence of the Government against that charge. Apparently he did not consider it to be necessary for the Government to make any denial ! Apparently this Government is so accustomed to breaking the promises that it makes to the people of Australia that it no longer recognizes any necessity to defend its honour in this respect even by one word !
There is a popular song, which honorable members no doubt have often heard on the “ hit parade “ over the radio, the title of which is. “ How could you believe me when I said that I loved you when you knew I’d been a liar all my life?” The Government wooed the dairying industry with promises on which it obtained election to office, but now it appears to be astonished that the dairyfarmers should have believed for one moment that it spoke seriously when it made those promises. The honorable member for Lalor (Mr. Pollard) has quoted the terms of specific pledges that were made by the Government parties to the dairying industry. I shall quote several more examples of such promises. The following pledge was made in an advertisement that was published throughout Australia on behalf of the Liberal party and the Australian Country party on the 19th November, 1949 : -
The land: Stabilize rural industries on the basis of guaranteed minimum prices - subject to approval by ballot of producers. Longterm stabilization of the dairying industry for ten years - by subsidy where price is not raised.
The price has not been raised in New South Wales and Queensland to the level that was guaranteed, but the Government is not providing the subsidy which it promised in order to gain office with the help of dairy-farmers’ votes. The same advertisement included this pledge -
Prices: keep prices down by restoring value of the fi (now only worth 10s.).
That was in November, 1949, of course. The £1 is now worth about 5s. 4d.
– Order ! The honorable member must keep to the terms of the subject on which the motion is based.
– I am quoting an advertisement, Mr. Speaker.
– The honorable member may read only those portions of the ‘advertisement that concern the dairying industry.
– It concerns the dairying industry, Mr. Speaker, because it contains this promise -
Encourage production and pay price subsidies when necessary, e.g. on items affecting cost of living of basic wage-earner.
Butter is a commodity which, as you will agree, Mr. Speaker, intimately affects the cost of living of the basic wage-earner.
That advertisement contained two specific promises to which no conditions were attached. Now the Government has completely repudiated both of them. What justification does the PostmasterGeneral offer for that repudiation? He says, in effect, “ It is true that we have repudiated our promises and that the Government has broken the pledges that it gave to the dairy-farmers, but we are not the only people who have dishonoured promises “. He claims that the present honorable member for Lalor, when he was Minister for Commerce and Agriculture, also made promises that were not honoured, but he has not succeeded in substantiating that charge. The truth is that, when the investigating committee recommended that the return to the butter producer should be increased, the Chifley Government first endeavoured to persuade the State Prices Ministers to give effect to that recommendation by increasing the price charged to butter consumers. That was perfectly legitimate. It was what this Government was entitled to do without in any way repudiating the pledge that it had made to the industry. But when the Chifley Government failed to obtain acceptance of that increase by the States’ Prices Ministers, despite the efforts of the present honorable member for Lalor, in complete fulfilment of its promise to the industry, that Government gave the full 2$d. increase, and dated it back to the 1st July. Therefore, the charge against the Opposition does not hold water. The Minister endeavoured to excuse himself on the ground that he is not the only representative of a government who has broken a promise. His Government has failed in its promise to the industry and it cannot claim that it is justified by any similar action on the part of any previous government. Early this year, during the life of the previous Parliament, the Labour Opposition moved the adjournment of the House to discuss the serious position then existing in the dairying industry. On that occasion, as many honorable members will recall, the present Minister for Commerce and Agriculture (Mr. McEwen) cast ridicule at the statement that there was any promise to the industry.
– Is the honorable member referring to debates of the present session?
– I am referring to a debate in the previous Parliament, early this year. I moved the motion on behalf of the Opposition, and in his reply the Minister for Commerce and Agriculture gave a specific promise of the action that the Government would take when the report of the committee inquiring into costs of production had been received. As reported in Hansard of the 13th March, 1951, at page 349, the Minister said -
The Government will make its decision as soon as it receives the report. It would not ask tor such a report if it did not intend to act upon it.
The Government asked for and obtained the report, but did not act upon it. Subsequently, during the same speech, the Minister did as the Postmaster-General has done this afternoon. He referred to the negotiations between the Government and the committee, and between the Commonwealth and the United Kingdom Government. After enumerating all the relevant factors, including the claims that the industry had made for improved conditions, the Minister, as reported at page 350, stated-
What the Government asks the United Kingdom Government to do it will be prepared to do itself in relation to production for hum an consumption.
And yet the Government has not done one of the things that it asked the United Kingdom to take into account in fixing the price of butter for export. There has been deliberate repudiation of the promise then made by the Government to the industry. I could go on quoting from page after page of Hansard similar pledges made by this Government to the dairying industry. All of them have been dishonoured. I should like to know whether the Postmaster-General would be prepared to go with me to Bega while these promises are still fresh in the minds of the farmers there, and attempt to defend the Government’s complete betrayal of the dairying industry.
– Order ! The honorable member’s time has expired.
.- The subject of who shall pay for butter is probably the most unfortunate one in Australia at present because we shall probably face a famine not many months or years ahead. The longer that we wait for proper conditions in the dairying industry, the worse it will be for .this country. The more that governments interfere with commerce the worse it will be for the country, and the sooner that prices are removed from political influence the better it will be for all con cerned. The longer that this goes on and the longer that these wretched costs committees function, the worse it will be, and we shall be very hungry indeed. The present inflationary pressure and the actions of the various committees in connexion with commodities such as butter and wheat, make it extremely difficult for the farmer to carry on.
The honorable member for EdenMonaro (Mr. Allan Eraser) referred to an advertisement in November, 1949, about long-term stabilization of the dairying industry. At the time we believed that we were dealing with ordinary rational human beings, and that a subsidy would be possible if sane co-operation could be obtained from the States’. prices commissioners. We thought that we were dealing with normal human beings who would react in a normal way, not people completely crazy and almost lunatic in their approach to the problem. The honorable member for Lalor (Mr. Pollard) avers that he kept his promise, that for six months he had tried to get the States’ prices commissioners to act as they could have acted in order to establish proper relationships between the producers and the consumers, and to see that proper prices were paid, and that if necessary he would have been prepared to bolster arrangements with a small subsidy. However, he got caught up in the election and broke his promise. The present Government, a few hours after it took office, acted on a submission by the Joint Dairying Industry Advisory Committee. A few months later a new submission was made and this Government immediately met the whole matter by subsidy. A few months later, another application was made. All this time the subsidy was increasing by leaps and bounds, from the £5,000,000 which the honorable member for Lalor was trying not to exceed, to between £6,000,000 and £7,000,000 on our first application of subsidy, until it reached the staggering figure of £16,800,000. That meant that of the cost of 3s. 3 1/2 d. per lb. of butter the Commonwealth subsidy was about ls. lid. per lb., and consumers were paying 2s. 2d. per lb. If the present submission of the Opposition were agreed to, the Commonwealth Treasury, representing the taxpayers, would pay about half of the cost, or 2s. per lb., and the consumers 2s. 2d. per lb. That reaches the depths of absurdity. If the price of butter rose to 10s. per lb., as it may quite easily do, the Commonwealth would be paying about 80 per cent. of the price by subsidy. It is true, as the honorable member for Eden-Monaro has stated, that the Minister for Commerce and Agriculture agreed that the Commonwealth would take action when it received a submission. Let us consider the action that was taken. The Minister immediately called the States’ prices ministers together and talked with them for a long time. The Labour Premier of Tasmania said that he agreed that the price should be raised by the full amount of11½ per lb., representing 9½d. increase of producers’ costs and 2d. increase of manufacturers’ costs and distributors’ margins. He contended that in view of the importance of the dairying industry he would not leave it to the whim of any government to meet the position wholly by subsidy. He agreed that the price in Tasmania should rise by the full amount. Shortly afterwards, a price of 3s.1½d. per lb. was gazetted in Tasmania. In Victoria where the Labour vote influences the decision of the parliament, the price was raised to 3s.1½d. per lb. by the prices Minis ter, Mr. Hyland, with the cognizance of the Labour party in that State.
What happened in New South Wales? The Premier of that State, Mr. McGirr, agreed to an increase of 6d. per lb. in the price of butter. He said that, under the old formula, the price should be increased by 5.8d. per lb., and he added another . 2d. in order to make the price 2s.8d. per lb. If Mr. McGirr be correct, the Commonwealth is completely exonerated and has honoured its guarantee. But I do not agree with Mr. McGirr. I believe that payments to dairy-farmers should be placed upon a better basis than that. The Commonwealth agrees that that should be done and four of the States have come into line with it, leaving two of the States out on a limb. Mr. R. B. Nott. the member for Liverpool Plains in the New South Wales Parliament and one of the most balanced and decent members of the Australian Labour party in that parliament, made a speech about butter on the 13th September. In the course of the speech, he said -
On 24th August, the Premier said, “ The6d. per lb. butter price rise will cover extra costs” and he added that these were assessed at5.8d. That was correct under the old formula based on 1942 values for stock and plant, but the new formula, with which every one agrees, assesses land and stock at 1951 values and still provides for a56-hour week, still giving the employee only £8 18s. a week and the owner-operator, who might work twelve or fourteen hours a day, £866 a year.I made a statement on the subject and I consider that whatI said was appropriate - I stand by it. I raid that I was disgusted with the attitude adopted by the New South Wales and Queensland Cabinets in increasing the price of butter by only6d. per lb., and went on tosay that it was true that under the old formula the price rise wouldhave been 5. 8d. and thatI considered the dairy-farmer fully entitled to the Commonwealth recom mended increase of 9½d. I added that even if the public had to pay 3s. 2d. retail forbutter, in the light of present-day wages and the food value of this product it was not dear. I stated definitely that the dairy-farmer was not getting a fair deal and was fully entitled to withhold supplies until a price increase of9d. per lb. was granted. I stand by that statement. These costs were assessed by an independent tribunal which was originally established by the Chifley Government and the values have been increased tobring them to 1951 levels. If an Arbitration Court made an award granting a union an increase of 9d. an houror 9d. a day and themen did notget it, I should say that they would be justified in going on strike. If the dairy-producer does not get the increase he is quite justified in withholding supplies. My statement waspublished in the Scone Advocate on the 29th August, and a letter came to me on the 3rd September from the secretary of the Scone branch of the Labour party. A special meeting of the party had been called to consider mystatement and this is the letter that I received- 2nd September.
Mr.R. B. Nott, Parliament House, Sydney
At a special meeting of the A.L.P. held at Scone yesterday, I was instructed to write you and state that we are in accord with the views that you expressed on the butter question.
– Order! The honorable gentleman’s time has expired.
.- The honorable member for Macarthur (Mr. Jeff Bate) begged the whole question. I do not think there is any honorable member of this House who is not in favour of the dairyman getting a reasonable return for his labour in the same way as other workers do but we are discussing the method of payment. Neither the Prime Minister (Mr. Menzies) nor the Treasurer (Sir Arthur Fadden) will deny that, during the last general election campaign, the Government parties promised to continue the payment of subsidies to butter producers. Doubtless they received a lot of support as a result of having made that promise. For them to try to place the onus in this matter upon, the shoulders of the State Premiers is undoubtedly an astute move, but it is not an implementation of the promise that they made to the Australian peoplewhen they were appealing for support. That is a matter that we should keep in mind. I have been in parliaments for a long time, and whenever I have made a promise from a public platform I have endeavoured to honour it. A sum of £16,0.00,000 has been mentioned, and that is a very large sum indeed. But it must bc remembered that if the Commonwealth were to pay a subsidy of £16,000,000 on butter, the money would be returned to it as a result of the operation of income tax. If the whole of the increased cost of producing butter were borne by the consumers, the Commonwealth would get a return from the dairy-farmers through the operation of income tax but, in effect, an additional tax would be imposed upon the consumers of butter.
The dairying industry has had a difficult time since its establishment in Australia. The Australian £1 was devalued in order to help dairymen and other primary producers. For many years, Australians paid high prices for butter and were, in effect, subsidizing it in order that overseas markets for it could be established. It is true that the Australian butter that was sent overseas contained less moisture that that which was sold in Australia, but for years the Australian consumer paid more for butter to enable us to sell our product cheaply overseas and thus establish markets for it in other countries.
– “What about sugar and wheat?
– The sugar industry is very well organized. Mr. Andrew Fisher and Mr. T. J. Ryan signed the first sugar agreement, which was the basis’ on which the industry founded its present magnificent organization and established itself in a position in which, with reasonable assistance, it can stand on its own feet. The Labour party has always endeavoured to assist the dairymen. We have helped them by bank advances, by building roads and in other ways.
Let me state one of the reasons why butter production is being retarded. In north Queensland, a dairy-farmer can make a decent living from a herd of 50 cows, but, owing to the incidence of income tax, dairymen now find that they get a better return from milking 30 cows than from milking a herd of 50. Therefore, butter production in Queensland is being retarded seriously at the present time. I admit that dairymen are handicapped in many ways. When the Americans came to the Atherton Tablelands, they insisted upon pure milk. In north Queensland there is a very big milk industry running parallel with the dairying industry. The Malanda butter factory supplies milk down to Townsville and out to Mount Isa. The Milla Milla butter factory supplies milk from Innisfail northwards. In addition, there is a pig industry, which depends largely upon the supply of skimmed milk. So far as the tablelands dairymen are concerned, the price of butter does not show their full return. Recently I visited my electorate, where I met many farmers who are up to date and have developed their land in the proper manner. Those farmers told me that they are making a decent living. I also met several young men whose farms had been handed down to them by their fathers, and they said to me, “ We are not doing too badly, Harry, but of course an extra shilling a pound would not hurt “. However, next door to farmers such as those very often there were others on whose farms the original timber which had been cleared was still lying on the ground, thereby reducing the carrying capacity of the land and making it impossible for them to make a reasonable living, irrespective of the price received for their butter. I saw one farm in the northern district of Queensland where the farmer was buying store cattle and fattening one beast to the acre. On each side of his farm the farmers had their stock out on the main roads and in the forest. Their farms would not’ carry one beast because of neglect and failure to adopt modern methods. In my opinion, it is a national disaster that such people are permitted to remain on the land. Nevertheless, I wish to pay a tribute to the dairy-farmers as a whole, and I fully support their claims for a reasonable price for their products. Reference has been made during this debate to action taken by the Queensland Government concerning the dairying industry. ‘ I remind honorable members that a question of tactics was involved. The Prime Minister and the Treasurer, with advice from other astute members of the Cabinet, endeavoured to put the onus on the State Premiers. Some of the Premiers fell’ for it, but others were as astute as the right honorable gentlemen to whom I have referred and refused to carry a burden which the members of the Government parties had promised would be carried by the Australian Government. A promise was made and the people believed that it would be kept. They gave their support to the parties represented by those who made the promise. Later, something altogether different was put to the people. I know that astuteness is required in politics, but it is unfortunate that in the battle of tactics it is the dairyman who suffers.
Mr. ACTING DEPUTY SPEAKER (Mr. Bowden). - Order! The honorable member’s time has expired.
.- The honorable member for Leichhardt (Mr. Bruce) has stated that he is in favour of dairymen receiving a satisfactory price for their products, but he does not commit himself regarding what that price should be. He has referred to the astuteness of politicians. As far as I am concerned, my conscience is perfectly clear concerning any pre-election promise made by me on this matter. In supporting the policy of the Government as contained in the policy speeches of 1949 and 1951, I also have a clear conscience. The honorable member for Lalor (Mr. Pollard) and the honorable member for Eden-Monaro (Mr. Allan Fraser) have stated that those policy speeches contained promises to support incentive payments, to. guarantee prices, to stabilize the dairying industry for- ten years, and to pay subsidies where the price is not raised. The dairymen of my electorate, which is the biggest dairying electorate in Queensland, support my contention that the Government has carried out its undertakings. I do noi know how the honorable member for Eden-Monaro is able to justify his sup; port of the McGirr Government- in New South Wales, which obviously desires cheap butter, even though it means starvation for the dairy-farmers. I suggest that the honorable member for Leichhardt will need to say to the dairymen of Northern Queensland something more definite than his statements in the House this after; noon. What the dairymen wish to know; is where the hard cash is coming- from rather than that Mr. Gair and Mr. Hanlon are astute politicians.-
This Government has honoured the promises that it made to the dairyfarmers whereas the Chifley Government broke its promises to them. In its first year of office the Chifley Government did not accept the cost of production figure and reduced the price of butter from 2s. ltd. per lb. to 2s. per lb. Later, that Government guaranteed the price of butter for only six months instead of twelve months. The members of the present Government parties told the dairymen that if elected they would immediately give them a guaranteed price for the remainder of that year, which was done. Managerial costs were added to the price, which was maintained during the two succeeding years. As soon as the Government received the report of the Joint Dairying Industry Advisory Committee this year, it set out to devise a method by which that promise could be guaranteed. However, the Governments of New South Wales and Queensland are undermining the Australian Government in its endeavours.
I have received dozens of protests from organizations of dairymen in my electorate, but not one of those organizations has taken either me or this Government to task for failing -to keep a promise. Without exception, they are taking the Queensland Government to task because they are disgusted with its action in withholding from them the price to which they are entitled according to the costfinding authorities. The honorable member for Leichhardt may believe that the members of the Queensland Government are astute, but in my opinion they are killing the dairying industry. The honorable member has spoken of minor matters which affect the industry, but I suggest that the action of the Queensland Government will do more than anything else to adversely affect it, particularly when such action is taken during a time of drought. That Government yesterday placed upon the statute-book legislation which imposes upon the Queensland board the duty to ensure that consumers shall be supplied with reasonable requirements of dairy products, although that Government will not give the producers a reasonable price for their products. That legislation also empowers the board to appoint inspectors to police the industry and to carry out compulsory acquisition of dairy products. The honorable member for Leichhardt supports a leader who accuses the Government of attempting to set up a police state, while the Government of his own State of Queensland is in fact doing so by imposing intolerable conditions upon dairymen. I suggest that the members of the Australian Labour party want starvation wages and a 56-hour week for dairymen. I assure them that this Government will not allow that to be brought about, nor will it follow the suggestion of the honorable member for Leichhardt concerning subsidies. It will be remembered that the honorable member said that the Australian Government would receive back part of such subsidies by way of taxes. He still does not want them to get the full price. He wants the Commonwealth to grant a subsidy to provide a larger return to the farmers, but under that scheme the farmers would still get only a part of the price to which the cost-finding committee said they were entitled. I consider that the Queensland Labour Government and the McGirr Government in New South “Wales have taken a most miserable attitude in this matter. They are playing politics to the lowest degree, and they will kill the dairying industry if they cannot take any more effective action than they have taken so far, including the legislation that was passed in Queensland yesterday under which, according to the Minister who introduced it, the Queensland Government could dissolve the Queensland board that controls the butter industry in that State, or the board dealing with any other primary commodity, and appoint in its place a board of stooges representing the Queensland Government. Does the honorable member for Leichhardt support that action of the Queensland Government? In my view that Government’s action is consistent with its police state action in the past when it gained the passage of an act under which the Queensland Meat Board could acquire meat by simply ordering it by telegram or letter, imposing on the owner of the stock the obligation to send the stock to the board without his having any right of appeal regarding the price to be paid. That is typical of the attitude of the Labour party, the members of which criticize this Government, which has honoured every promise it made and has certainly honoured the promise that it gave to the dairymen in Queensland. We shall go on honouring these promises, but we believe that the method by which we seek to ensure that our guarantee to the dairymen is kept should not be undermined by the States. I consider that the Queensland Labour Government will get its reward at the next general election in Queensland, even though the electorates in that State have been gerrymandered and the Labour party can still win a majority of members with only 45 per cent, of the popular vote. But the dairymen will be up in arms throughout Queensland when election time comes.
I have received representations from dozens of dairymen who are suffering all the adversities attendant upon a drought. B.ura.1 Queensland could not be in a worse condition than it is now in, because of bushfire and drought conditions from one end of the State to the other, and it is amazing that primary producers there are producing any commodity at all. If the dairymen of Queensland received fi per lb. for their butter at the present time they still would not be able to pay their way, because, owing to bushfires and drought, they have to pay heavy charges for cattle feed so that they can go on producing. They are prepared to do that in order to keep their stock alive until the rain comes. Yet we have the miserable attitude taken by the present Queensland Government towards the dairymen. My belief that that Government doe3 not wish to help dairymen is borne out by the words of Mr. Gair himself, who said that it was not a matter of just trying to meet costs but that, in his opinion, an increase of 5.8d. per lb. was ample to cover cost of production. I remind the honorable member for Leichhardt of that. Well, the dairymen are not getting sufficient return for their butter and as a result they will leave the dairying industry and go into other industries. The cost-finding body said that 9.Sd. plus 2d. for other charges was necessary, and the Australian Government has accepted that finding in full. Having done so, it sought to implement a method by which that payment could be met. That method was accepted by four responsible State governments and rejected by two other State governments which apparently regard themselves as having no moral responsibility to the people whom they represent. Those two governments are playing politics and have no regard for what is right. They are prepared to make the primary producers work a 56-hour week although both of them overrode the Commonwealth Arbitration Court and upset the economy of this country by imposing, by legislative act, a 40-hour week.
– Order! The honorable gentleman’s time has expired.
.- This debate reminds me of 1931, when I first became a member of this Parliament and when a government of the same kidney as the present Government was in office. That government remained in office from 1931 until 1941, for two years of which period we were at war. For the whole of its decade of office the dairying industry of Australia did not receive 3d. increase of prices for its products, yet honorable members opposite are now shedding crocodile tears about the plight of the dairy-farmers. Between 1931 and 1941 anti-Labour governments did not keep one promise that they had made to the dairy-farmers, and it was left to a Labour government to put the dairying industry on its feet. When the last Labour Government left office, the dairying industry was in the most prosperous state that it had ever been in. There is abundant evidence of an attempt by the Government to shift the responsibility for the present butter position from itself to the Governments of New South Wales and Queensland. I consider that the dairy-farmer is entitled to a just return for his labour, and therefore to a fair price for the butter that he produces. At the same time, our view is that the interests of the consuming public must also be protected, and such protection is properly the function of the Australian Government. We also believe that there is no need to sabotage the interests of the dairy-farmers in order to protect the interests of the consuming public.
There has been much talk, but precious little action, on the part of the Government in connexion with putting value back into the £1. That was another promise that honorable members opposite made and ‘ repudiated. It is elementary that if the whole of the increased cost of butter production were passed on to the consuming public, housewives, age and invalid pensioners, and people on small fixed incomes or other comparatively small incomes with heavy family responsibilities, would have to bear a heavier burden. Honorable members opposite know perfectly well that if the increased cost of production of butter were passed on to the public the basic wage would rise by 2s. a week. I consider that the Premier of New South Wales gave a complete answer to the Australian Government on this very subject when he said in the New South Wales Parliament -
The present Federal Government has undeniably evaded its commitments under the 1947 Prices Guarantee Plan for the dairying industry, which was to have operated for five years until 30th June, 1052. To support the contention that the present Liberal-Country party Government at Canberra, is dishonouring its pledges to the people by its attitude, I shall quote an extract from the joint policy speech delivered bv the Prime Minister in November, 1949 - not 1945 or 1946, as referred to by the Leader of the Opposition, and the Leader of the Country party-
He was .there referring to the right honorable member for Kooyong (Mr. Menzies) and the right honorable member for McPherson (Sir Arthur Fadden). He continued -
These two gentlemen said -
In particular, we support a long-term stabilization of the dairying industry for ten years (by subsidy where the price is not raised).
In the policy speech of November, 1949, delivered by the present Federal Treasurer, Sir Arthur Fadden said -
To stabilize the wheat, dairying, and other primary industries, we favour the payment to producers of incentive guaranteed minimum prices for at least ten years.
These prices, we hold, must cover fair production costs, plus a fair margin of return to the producer, giving a reasonable living standard for himself and his employees.
Home consumption prices will be paid for locally consumed primary products, to be fixed periodically on the basis of production costs and parity, plus an allowance to offset the burden imposed by national economic policy, on the export industries.
Guaranteed minimum prices will be determined after adequate survey by an independent body, and a stabilization fund will be offered for each industry which sodesires.
The guaranteed price - covering not only the found costs but also a reasonable profit margin for efficient production - will be ascertained by this independent cost-finding tribunal which will be on the model of the Tariff Board.
The dairy industry has been harder hit by Socialist policy than any other. Notwithstanding that our population has increased by three-quarters of a mill ion since the beginning of the war, the number of dairy cows has declined and our whole milk production for all purposes has remained practically stationary. By refusing to accept the Joint Dairy Industry Advisory Committee’s recommendation and thus forcing the farmer to produce at a loss, the Governmenthas involved the industry in a total loss of ?2,000,000 a year. To remedy this, we will determine production costs on just basic principles which will give the fanner a fair return for his labour, investment, and long hours of work, and an incentive to produce on a sound and equitable basis.
There the House has - in all its starkness - the declared policy of the Commonwealth Government in relation to the dairy industry. It is fair to say thatprimary producers at any rate, and possibly also the consuming public, were influenced to vote for the LiberalCountry party coalition at the elections in December, 1949, on the basis of such promises. But I should imagine that the dairy-farmers themselves are now sadly disillusioned at the reversal of form of those two parties, after eighteen months in office. I doubt whether there is any need to quote statements made by others, who are now members of the same Federal Cabinet which has refused to honour its obligations and promises; but perhaps it may be of some interest to mention that the present Minister for Commerce and Agriculture, Mr. McEwen - whose ministerial functions relate to the dairy and other rural industries, whose primary responsibility it is to concern himself with butter production and subsidies, in September, 1949, asked this question in the Federal House: -
Is it a fact that a further conference of State Prices Ministers will be held shortly to consider the recommendation of the Joint Dairying Industry Advisory Committee that there should be an increase in the price of butter based on demonstrated increases in the cost of production? If so, when is it proposed that this conference shall take place? Will he (the Minister for Commerce and Agriculture) give an assurance that all information required by the State Prices Ministers will be released to them in order to assist them in reaching a decision? In the event of rejection of State Prices Ministers, either in whole or in part, of the recommended increase, will be give an assurance that the promise given to dairy-farmers will be honoured and that the whole of the recommended increase will be made good to them out of consolidated revenue ?
That is the Mr. McEwen who to-day betrays the farmer and tells him to get off the back of the public. When a Labour Government was in office he said that increased costs should be met from consolidated revenue.
-(Hon. Archie Cameron). - Order ! The honorable member’s time has expired.
– We have listened to members of the Opposition making a pathetic attempt to whitewash the black deeds of the two State Premiers, the Labour Premiers of New SouthWales and Queensland. Such a defence comes strangely from a party which, when it was in government, did all that it could to hamper the dairying industry and other primary industries in Australia. It is a matter of history that when the present Government came into power dairy-farmers were walking off their land or were going in for grazing because of the attitude of the Labour Government towards their industry. Now, spokesmen for the Labour party are coming to the assistance of the wretched Governments of New South Wales and Queensland, which are continuing the treatment accorded to dairyfarmers by the Chifley Labour Government when it tried to wreck the industry, and bring it under the yoke of socialism. Referring to the Premiers of New South Wales and Queensland, one member of the Opposition described them as astute politicians. That was a master-piece of under-statement. They are the most scurrilous rogues who ever entered parliament.
– Order ! Tie honorable member must not refer to State Premiers in that way.
– The Labour Government passed through the Parliament of Queensland legislation known as the Sugar Acquisition Act which gives almost dictatorial power to Ministers. A year ago, it introduced an abattoirs bill, which was subsequently passed, giving power to government inspectors to enter the properties of all graziers and farmers in Queensland.
– I rise to a point of order. What relationship have the remarks of the honorable member to the motion before the House?
– I have been listening to the honorable member’s remarks, and they are not related to the question, which I shall read again for the benefit of honorable members -
The failure of the Government to honour its election promises to the dairying industry.
The dairying industry is the only industry under discussion.
– The Queensland Government introduced legislation recently to enable it to take over the product of any industry, including the dairying industry.
– The honorable member seems to be discussing the acts of the State of Queensland, but they are not at present before the House.
– In 1947, the Chifley Government introduced a five-year guarantee plan for the dairying industry. Under the formula which operated in that year of grace, it was worked out that the cost of production had increased by 5.8d. per lb. of commercial butter. In 1949, the Treasurer promised that the Government would meet by subsidy any increase of cost under the Chifley plan if the State governments refused to allow the cost to be passed on to the consumers
As I have said, the increased cost ascertained under the Chifley plan was 5.8di per lb. and the Governments of New South Wales and Queensland have agreed to a price increase of 6d. per lb. Thus, the Commonwealth has been released from its promise to meet the increased cost of production by subsidy. The present Government enlarged the scope of a cost survey, and under the new and more reasonable formula it was ascertained that the cost of production had increased by 9.48d. per lb. Four State governments accepted that finding as reasonable, and recognized that if the cost were not passed on the dairying industry would go to the wall. However, in New South Wales and Queensland the price of butter was increased by only 6d. per lb.
In 1949, when the present Government came into power, the Commonwealth subsidy to the dairying industry was about £5,000,000 a year. Obviously it was not enough, because the industry was declining, and dairy-farmers were walking out. A survey showed that the cost of production was 2s. 6 1/2 d. per lb., and this figure was increased to 2s. 8 1/2 d. as a result of a basic wage increase. When the States refused to pass on the increase, the Commonwealth increased its subsidy to £16,800,000, and announced that it would not go beyond that figure. There is something significant in the action of the Commonwealth in fixing the amount of the subsidy, and stating that it would not go beyond that amount. In 1949 the Chifley Government announced that it would not increase the amount of subsidy being paid in respect of butter, which was then less than £5,000,000. The present Government has honoured its promises to such an extent that it has increased the subsidy on butter by more than 300 per cent, since it came to office, which is no mean feat. It has guaranteed to the dairy-farmer a reasonable return for his efforts. If the Australian Government were obliged to increase the subsidy every time State Ministers in charge of prices increased the price of butter, the State Ministers could continue to increase the selling price to such an extent that in a few years’ time they would control the budget of the Australian Government.
Having spoken to the dairymen of central Queensland, I say that they do not want an additional subsidy on butter. They have told me emphatically that they do not want to be a political football. They have said, “ It is all right while you are in power, but if the Labour Government got back it could smash us overnight by withdrawing the subsidy “. They want the consumer of the butter to pay a price based on reasonable costs of production. If no subsidy was paid by the Government at present, the housewife would have to pay 4s. 2d. per lb. for butter. Thanks to the efforts of the Government, she will have to pay only 3s. 1-id. per lb. in New South Wales and Queensland, when the governments of those States come to their senses. If there is anything wrong with that state of affairs, I cannot see it and the dairyfarmer cannot see it. He only wants justice, which he has not received until the last couple of years. The last Labour Government did not give him justice.
This motion has been submitted in an attempt to whitewash the black deeds of two Labour governments in their attempts to socialize, and to destroy a great primary industry which has been built up by the sweat and toil of pioneers and the hard work of women and children in the community. If Labour believes in arbitration let it stand by that principle. The arbitration authority of the dairy industry has found that dairy-farmers are entitled to a rise of ll£d. per lb. in the price of butter. If honorable members of the Opposition believe in arbitration they should use their influence to persuade the Governments of New South Wale3 and Queensland to abide by the principles of arbitration and give to the dairy industry its just deserts and rewards.
.- The honorable member for Capricornia (Mr. Pearce) does not know much about the dairy industry. He has a lot to learn about it. The subject of the debate is the failure of the Government to honour its election promises to the dairy-farmers. Most of the promises of this Government have been dishonoured except, perhaps, its promises to profiteers and financial institutions, which have been carried out very well. No honorable member has attempted to deny that the Government’s promises have been broken. Honorable members opposite have stated that a subsidy was granted by the Labour Government in 1949 only because a general election was pending. I can now say that the Government has failed to honour its promise to the dairy industry because it believes that it is safe in view of the fact that there will not be another general election for three years, by which time its present actions will have been forgotten. It is for this reason that the Government has repudiated its promises to the dairyfarmers and to every one else.
In 1949, during the course of a debate in this House, the Minister representing the Minister acting for the Minister for Commerce and Agriculture (Mr. Anthony) said -
The Commonwealth blames the’ State prices authorities–
Exactly as the present Government is doing - but that is merely an attempt to draw a red herring across the trail. There is nothing to prevent the Commonwealth from granting a subsidy on butter as it still does on tea. In my opinion, a subsidy rather than a price increase is best for both producer and consumer.
The Government made promises on the occasion of the last general election because it wanted votes. Now it has set about repudiating its promises. ‘ The Government parties announced, before the general election, that they would take action to reduce prices and to put value back into the £1. That was their policy prior to the elections. Immediately after the Government came to office it withdrew the superphosphate subsidy, the immediate effect of which was to increase the costs of primary producers.
The public will probably ask whether the Government is in a financial position to honour its promises. During the course of his budget speech the Treasurer (Sir Arthur Fadden) announced an estimated surplus of £114,500,000, so the Government cannot hold that lack of finance prevents it from increasing the butter subsidy. I agree with what the Minister representing the Minister acting for the Minister for Commerce and Agriculture said in 1949, but now that be is a member of the Government he has reversed his attitude in this matter. The previous Labour Government kept every promise it made to the people. I could show to the honorable member for Capricornia the Hansard report of statements by the Minister representing the Minister acting for the Minister for Commerce and Agriculture concerning the terrible conditions under which dairy-farmers worked. They and their children used to work all hours of the day and night. The dairyfarmers’ production costs are now assessed after careful investigation by the Joint Dairying Industry Advisory Committee and adjustments are made from time to time in the estimated cost of producing a pound of butter in much the same way as adjustments are made in the wages of workers. I warn primary producers generally that if they place their trust in non-Labour governments they will gradually lose all the benefits that Labour governments have bestowed upon them. I warn the dairy-farmers to take no heed of the flowery promises of honorable members opposite.
Mr. Eric J. Harrison interjecting,
– I warn all the people, except the bankers and the profiteers, not to take notice of what the Vice-President of the Executive Council (Mr. Eric J. Harrison) may say on any matter. The charges made against the Government during this debate have been well sustained. The cost of living is increasing daily and the burden of increased costs is being felt most by retired persons and pensioners, many of whom undoubtedly were supporters of non-Labour governments. Many retired bank managers are now struggling to meet rising living costs. The Governments of New South Wales and Queensland are doing a job on their behalf which the Australian Government itself should undertake.
Dr. DONALD CAMERON (Oxley) 1 5.2]. - Let us review some facts and figures upon which the subsidy paid to the dairy industry is based. Let me remind the House that when the present Government assumed office the subsidy paid to the dairy industry amounted to £5,400,000 per annum and that since then the subsidy has been increased on five occasions by this Government and now amounts to £16,800,000 per annum. The Joint Dairying Industry Advisory Committee, which is charged with responsibility for estimating production costs in the industry, has estimated that it costs 3s. 6d. to produce 1 lb. of butter. On that basis, if no subsidy were paid the price to the consuming public would be 4s. 6d. per lb. Dairymen asked the States to fix the price at 3s. 1 1/2 d. per lb., which would cover their costs after allowing for the subsidy. Four States agreed to do so, but two refused and endeavoured to maintain the price at 2s. 8d. per lb., or l.Od. per lb. below the estimated cost of production. A price of 3s. lid. per lb. would be more than ls. per lb. below what the consuming public would pay if the price were not .cushioned by Commonwealth subsidy. In a discussion of this kind it is important to remember two facts. In the first place, the subsidy, which was originally intended to assist producers, has now become a subsidy to consumers. If it were increased as has been suggested by honorable members opposite, to cover the latest cost increase, the annual cost to the Commonwealth would be raised by £11,500,000. In the second place, the cost of butter is now estimated on the basis of a 56-hour week. If, in the future, it is estimated on the basis of a 40-hour week, as I hope it will be, and as I am sure honorable members opposite agree it should be, production costs will increase by an additional 10id. per lb. and the total annual subsidy will have to be increased by £13,000,000. The increase in the charge on Commonwealth funds will not end there; other factors, such as basic wage adjustments and increases of the cost of implements and other requirements may conservatively be estimated at an additional £5,000,!000. If the policy advocated by honorable members opposite were adopted the Commonwealth would soon have to subsidize the dairy industry to an amount of no less than £50,000,000 a year. Does any honorable member opposite contend that an industry which has to be so heavily subsidized rests, on a stable basis? If such a state of affairs existed the dairy industry would be completely unstable, and at the mercy of the government of the day. An alteration of government policy might result in its destruction overnight. The proposition that the Government should not limit the subsidy to £16,800,000 but increase it ad infinitum, is ridiculous*. Dairy-farmers throughout the length and breadth of the Commonwealth desire only that their industry shall be established on an economic basis and not be placed in a position in which it may be destroyed overnight as the result of governmental action. It would obviously be impossible for any government which had regard to the national interest to continue to increase the subsidy on the scale advocated by honorable members opposite.
Let me refer to two warnings given to the country recently. One of them was issued by the Governor of the Commonwealth Bank in a recent report in which be said -
We have built up a volume of imports which «”e are unlikely to ‘be able to sustain over a long period from our own resources.
The second warning was issued by no less notable a person than the economic adviser of the Government of Queensland, who pointed out that 28.4 per cent, of the labour force in Australia is engaged in secondary industries compared with 22.6 per cent, in the United States of America, which is the greatest industrial country in the world. He has pointed out, in season and out of season, that unless by some means or other a larger proportion of our labour- force is employed in primary industries we shall be faced with the position about which the Governor of the Commonwealth Bank has warned us, in which we shall bc unable not only to finance our present volume of imports but also to maintain our present standard of living. In the face of these warnings we have now been invited by honorable members opposite to increase the subsidy to the dairying industry to a possible total of £50.000,000. Where. does the money come from with which’ this subsidy is paid ? Obviously it comes from taxation. Last night we witnessed the spectacle of the Leader of the Opposition (Dr. Evatt) attacking the Government because he considered that the taxes proposed in the budget were too heavy.
– Order ! The honorable member may not in the House refer to proceedings which took place in the committee.
– To-day we have witnessed the spectacle of honorable members opposite inviting us to increase the subsidy to the dairy industry possibly to £50,000,000. This motion demonstrates that honorable members opposite have a total disregard for the national interest and that they are completely insincere.
.-1 desire to put before honorable members a few matters which touch upon the effect upon the consumers of an increased price for dairy produce. If the price of butter is increased in order to give a fair return to dairy-farmers, many people in the community whose incomes are fixed, such as pensioners, superannuated employees and others, will no longer be able to buy butter. There are also numerous people who will not be able to afford to pay the higher price because its later reflection in the basic wage will cause prices generally to become further inflated. There are thousands and thousands of people in New South Wales and Queensland who are at present commending their State Governments for having the courage to oppose the deliberate repudiation by the Australian Government of its promises to the electors. No matter what arguments may be advanced by honorable members on the Government side, written indelibly in the policy speeches of the Treasurer (Sir Arthur Fadden) and of the Prime Minister (Mr. Menzies) is the statement that they, if elected to office, would subsidize the primary producers, including the dairy-farmers, to safeguard production and prices. It is that promise that we ask the Government to honour, particularly in order to protect those people who will otherwise have to pay increased prices. I ask honorable members: What is wrong with the system of subsidizing this item of food ? Would not subsidization be a reasonable attempt to keep the price down?
There is nothing wrong, financially or economically, with a subsidy which ensures that the greatest contribution to the rising cost of production shall be borne by those who are best able to bear it, that is the people who pay the highest taxes. Government members have stated that it would cost far more to subsidize butter production now than they believed it would when they made their promise. I suggest that that is solely the responsibility of the Government. The Government bears full responsibility for the skyrocketing of commodity prices and the consequent necessary increase of subsidy in this particular case. No honorable member on this side of the House cavils at a man getting a fair return for his labour, whether he be a dairy-farmer or anybody else.
Debate interrupted under Standing Order 92.
Bill presented by Sir Arthur Fadden, and read a first time.
Bill presented by Mr. McBride, and read a first time.
Bill presented by Sir Arthur Fadden, and read a first time.
– I move -
That the bill be now read a second time.
This is a bill to increase the rates of pensions and allowances payable to various groups of ex-service men and women, and their dependants, under the Repatriation Act 1920-1950. Honorable members will no doubt remember that in November last there was a complete overhaul of the Repatriation Act. Anomalies were adjusted and substantial increases made of all pensions and allowances. The increase of the expenditure amounted to approximately £6,000,000 a year. In the joint policyspeech made by the Prime Minister (Mr. Menzies) on. the 3rd April, 1951, it was intimated that a further review would be made of repat riation benefits and allowances, especially in the case of those pensioners who, because of very severe incapacities, are more or less dependent upon their pensions for their means of living. The review has been completed and the provisions decided upon are contained in this bill. It will be observed that the rates of pensions specified in the bill are expressed in fortnightly rates. That is because war pensions are payable fortnightly. However, in this speech I shall refer to weekly rates.
Under the Second Schedule to the Repatriation Act 1920-1950 a member who is, as the result of war service, blind or unable to earn other than a negligible percentage of a living wage, is granted a special rate pension. At present the rate is £7 a week, and it is proposed to increase it to £8 15s. a week. This increase will cause a similar increase to be made in the rate of medical sustenance payable under regulation 71 (4) of the Repatriation Regulations.
Under the Fifth Schedule to the act, members suffering from amputations of limbs receive an amount in addition to the pension payable in accordance with the First Schedule. The first six items in the Fifth Schedule at present provide for the payment of an additional amount of £3 10s. a week to members who are suffering from certain amputations of two limbs. These payments give to them the equivalent of the Special Rate pension,, and so as to preserve that principle, the bill increases the Fifth Schedule amount by £1 15s. a week to £5 5s. a week. In order to give to honorable members a clearer picture of the total income of a totally and permanently incapacitated member, I cite the following examples : -
At present, a war widow receives £3 10s. a week, which is equal to the 100 per cent, base rate pension for a member, but if she has a child, or children, under the age of sixteen years, or is over the age of 50 years, she receives a pension of £3 10s. a week and an allowance of 103. a week. It is proposed to amend the Repatriation Regulations to increase the allowance of 10a. a week to £1 2s. a week. That will provide such widows with a pension of £3 10s. a week and an allowance of £1 12s. a week, making a total of £5 2s. a week. It is also proposed to amend the regulations so that the allowance can be paid to a widow who is under 50 years of age and has no children under sixteen years of age, but who is permanently unemployable. Let me cite an example of a war widow with three children aged 10, 13 and 15 years -
Service pensions are payable to members who are suffering from pulmonary tuberculosis, and to members who served in a theatre of war and are permanently unemployable or have attained the age of 60 years or, in the case of a female member, 55 years. Service pensions are subject to a means test similar to that applicable to age and invalid pensions payable under the Social Services Consolidation Act. The present maximum rate of service pension payable to a member is £2 10s. a week, but as age and invalid pensions are to be increased by 10s. a week, the service pensions of members will be increased by a like amount.
Honorable members will observe that the bill provides for the rates of service pensions payable to wives to be increased from £1 4s. a week to £1 10s. a week, and for the service pensions of first children from 9s. a week to 31s. 6d. a week. At present, a member cannot be granted a service pension if he has accumulated property - apart from the home in which he resides - to the value of £750. The bill provides for that amount to be increased to £1,000, and for the exemption on the surrender value of life insurance policies to be increased from £500 to £7 50.
Under section 91a of the Repatriation Act there are certain limits on the payments that may be made to service pensioners who also receive war pensions and/or pensions payable under the Social Services Consolidation Act. The bill provides for those limits to be increased by 10s. a week for an unmarried person; by 15s. a week for a married person whose spouse is also a service pensioner or a civil pensioner; and by 10s. a week for a married person whose spouse is not a service pensioner or a civil pensioner. An increase of age and invalid pensions payable under the Social Services Consolidation Act has an effect on the basis of war pensions payable to parents of deceased members and permits a higher assessment of war pensions.
The Government intends to increase the allowance payable to beneficiaries under the Commonwealth reconstruction training scheme, by 7s. 6d. a week, and to increase the fares allowance by 2s. 6d. a week. The proposals in the bill and the proposed increases of allowances which are contemplated under regulation 71 (4) and 176d, will cause the following increases to occur in annual liability: -
The opportunity is taken to inchide in the bill some items not associated with the main object of increasing pensions and modifying factors affecting the assessment of pensions. For example, the provision for a gratuity to a widow on remarriage, introduced by amending legislation last year, needs to be extended to cover a few instances in which a widow, although not actually in receipt of pension at the time of remarriage, is nevertheless entitled to a pension, and in all equity entitled to the gratuity. Another provision ensures that children of members afflicted with mental trouble shall be adequately assisted in regard to not only their general maintenance, but also their education, subsequent training for a position in life, and general advancement. Those items will be explained in detail during the committee stage of the bill.
I commend the bill to honorable members, and I trust that it will be passed as speedily as possible, as it is proposed that the increased war pension rates shall be made available from the first pension pay-day after the date of Royal Assent to the bill.
Debate (on motion by Mr. Pollard) adjourned.
Motion (by Mr. Eric J. Harrison) - by leave - agreed to -
That so much of the ‘Standing Orders be suspended as would prevent the Prime Minister (Mr. Menzies) from making his speech in Committee of Supply on the budget without limitation of time.
In Committee of Supply: Consideration resumed from the 2nd October (vide page 234), on motion by Sir Arthur Fadden -
That the first item in the Estimates, under Division No. 1 - The Senate - namely, “ Salaries and Allowances, £10,400 “ be agreed to.
Upon which Dr. Evatt had moved, by way of amendment -
That the first item be reduced by £1.
.- Before commencing my speech on this staggering blow to the nation, which will depress industry, lessen incentive to work, increase living costs, and impose great hardship on those people who are compelled to live on fixed incomes, I should like to comment briefly upon the contribution that was made to this debate last night by the honorable member for Swan (Mr. Grayden). Not once during his halfhour speech did he mention the subject under discussion. He contributed nothing to the debate but a tirade of abuse of, and numerous nasty insinuations about members of the Australian Labour party “whom he alleged to be collaborators with the Communists. The honorable member ako suggested that traitorous individuals of that political complexion in hia own constituency were carrying out acts of sabotage. I assure him that should the Labour party ever consider communism to be right, it will have the courage to say so. To-day, because we believe it to be wrong, we have the courage to fight it as we have been doing throughout the life of the Labour movement. Proof of that may be found in the fact that when we find Communists, Labourites or Liberals committing traitorous acts, we deal with them according to the law. It was a good thing that on the 22nd September last the people rejected the referendum proposal to alter the Constitution to enable certain legislation designed to deal with Communists and communism to be enacted because, had it been enacted and had the additional power for which it made provision’ ‘been placed in the hands of honorable members like the honorable member for Swan (Mr. Grayden), many decent ordinary persons would have been declared tinder it. If persons of the character that the honorable member described reside in his electorate he should urge the Government to have the courage to deal with them according to law.
I shall now deal with the proposals embodied in the budget - which, I repeat, has dealt a staggering blow to the nation. The Government has completely repudiated the promises that the Prime Minister (Mr. Menzies) made in his policy speeches at the general elections in 1949 and 1951. I propose to examine some of the statements that he then made. First, he said that the Chifley Government had been forced by public opinion to reduce rates of taxes to even a greater degree than had been proposed at the general election in 1946. The right honorable gentleman added -
We still believe that rates of taxation must bc steadily reduced as national production and income rise. And as economics are affected in administration, if elected, we will review the incidence of indirect taxes upon basic and cost of living items and housing costs.
The Government is now repudiating that promise by proposing to increase taxes of all classes. In 1945, during a most critical period of the war, the Chifley Government budgeted for a total revenue of £358,000,000, whereas the present Government is now budgeting for an amount that is three times greater than that sum. The Chifley Government budgeted for a total revenue of £373,000,000 in 1946, a total of £404,000.000 in 1947 and a total of £510,000,000 in 1948 and 1949. Thepresent Government budgeted in 1950-51 for a total revenue of £789,000,000 and it is now budgeting for the staggering figure of £1,041,000,000 for the current financial year. Those sums show to what degree the Government has broken its promises. “Whereas the Prime Minister undertook to reduce taxes as national production and national income increased, the national income has increased by approximately £800,000,000 since the present Government assumed office, but taxes have not been reduced. The increase of national income would normally increase revenue from taxes. The Government has not only ignored that fact, but also increased both direct, and indirect taxes by over £400,000,000, which sum is greater than the total revenue for which the Chifley Government budgeted in 1945 at a most critical stage of the recent war. After that conflict, the Labour Government was confronted with the task of rehabilitating over 500,000 ex-service personnel and it discharged that task with marked success.
Under the present Government’s budget for 1950-51, direct taxes were increased by £6,000,000 and indirect taxes by £10,000,000. The Government now proposes to increase direct and indirect taxes by £73,000,000. In addition, by abolishing the averaging system it will extract a sum of £47,000,000 from that section of the community friend of which it claims to be. On several occasions in this chamber the Treasurer (Sir Arthur Fadden) declared that the Government intended to impose an excess profits tax and he assured the Parliament that that tax would be made retrospective. Now, the Government says that it does not intend to impose a tax on excess profits. It proposes to increase company tax by £11,000,000 for the current financial year, but such a tax will not be an effective substitute for a tax on excess profits. It also proposes to collect a proportion of company tax in advance. Sales tax is to be increased by £35,000,000 and that impost will fall most heavily on persons in the lower ranges of income, particularly housewives.
– And the kiddies who want to buy popcorn!
– Yes! No section of the community will escape the new imposts provided for in the budget. In addition, increases of excise duties will yield £24,000,000, which will be derived mainly from taxes on beer and tobacco. I repeat that the increase of company tax will not be an effective substitute for an excess profits tax because, practically, companies generally will pass on the additional impost in the selling prices of their commodities. Thus, these taxes will increase the cost of living with the result that persons on fixed incomes will be hard put to it to purchase the necessaries of life. The workers will be obliged to pay 2d. more for a glass of beer that now costs 8d. The price of a schooner will be increased by 3d. and of a pint by 4d. or 4id.
– They will go down, too.
– Particularly with the Treasurer. A nip of brandy, gin, whisky or rum, will be increased by 2d. A bottle of beer, always assuming that it can be purchased, will cost an additional 5d., and a bottle of spirits an additional 4s. or 4s. 6d. The unfortunate worker who continues to smoke will pay an extra 3d. for a packet of twenty Australian or English cigarettes. But the fact that a cigar will cost an additional 1-J-d. will not worry him, because he cannot afford such a luxury. The sportsman will be required to make a substantial contribution to Consolidated Revenue. The price of a tennis ball will be increased by lOd. to 4s. 10d., of a top-, grade tennis racket by £1, and of a cricket bat by £1.
The new rates of sales tax will be particularly severe on women. Face powders, lipsticks, and foundation creams will be substantially dearer, a pair of shoes that formerly cost £5 will sell at £5 4s., and a dress that was priced £S will be marked £8 7s. Men will pay an additional Sd. for a packet of five razor blades, and the price of a jar of shaving cream will be increased by ls. to 3s. As the honorable member for Hunter (Mr. James) interjected earlier, the Treasurer has also had a “ smack “ at the kiddies. The sales tax will be increased upon ice-creams, ice-cream cones and ice-blocks. Even the Christmas cake and the birthday cake for the children will not escape the impost. The “ Treasurer will virtually be present at every party to wish the children many happy returns of the day, and to thank their parents for their contribution to Consolidated Revenue. The right honorable gentleman remarked that this is not a budget to make people giggle. I agree with him. If the people can restrain themselves from crying, the Treasurer will certainly stop them from laughing about it.
The proposed increases of age, invalid and widows’ pensions are totally inadequate. The payment to the wife of an invalid pensioner will be increased from £1 4s. to £1 10s. a week, which is also insufficient. Indeed, I go so far as to say that it is shocking.
Mr.- Wight. - It is more than the Labour Government provided.
– That is not correct, as the honorable member for Lilley (Mr. Wight) will discover if he will listen carefully to my remarks. The Treasurer stated in his budget speech -
It is proposed to ease the means test in certain ways, the main one being to raise by £250 the property limits above which no pension is payable.
The increase of the limit from £750 to £1,000 is inadequate, and the scope of the proposal is too restricted. The Government has not attempted to abolish the means test, about which honorable gentler men opposite have croaked for so many years. The Treasurer, although he has had two opportunities to relax the means test, has not seen fit to grasp them. The Labour party is the only political party in this country that has eased the means test in any way. The Curtin Government and the Chifley Government increased from 12s. 6d. to 30s. the permissible income of a person before his eligibility for a pension becomes affected. The Liberal party and the Australian Country party made firm promises during .the general election campaign of 1949 about the relaxation of the means test. I have in my hand copies of advertisements in which those promises were made, and I shall read them if any Government supporter should contradict me on this matter. The present Government definitely promised to review the means test, but has failed to keep its word.
– When were those advertisements published?
– During the general election campaign in 1949. The rate of the age pension will be increased to £3 a week, which will still be far less than the value of the pension when the preceding Labour Government was in office.
– I shall show that it is not nonsense. The age pension at present is only 31 per cent, of the basic wage, whereas the pension in 1948, when the Chifley Government was in office, was 36 per cent, of the basic wage. To restore that position, the Government should increase the age pension to not less than £3 10s. a week. The proposed rate is totally inadequate. I doubt whether the increase of the property limits, above which no pension is payable, will assist any one, because officers of the ValuerGeneral’s Department have revalued property. The proposal will not be of much benefit to those persons who are deprived of a pension at the present time because of the retention of the property limit. Some persons in my electorate own their homes and perhaps another small residence or shop from which they obtain a return of 30s. a week. Even with the increase of the property limit to £1,000, they will not become eligible for a pension. They are struggling to make ends meet on 30s. a week, and the Government has shown no sympathy for them in their desperate plight. The property limits prevent many deserving persons from receiving the age pension.
The Treasurer has no intention of modifying and increasing unemployment and sickness benefits. The present weekly rates of £1 5s. for a husband and £1 for his wife are out of date, and should be revised in relation to the cost of living. I remind the Treasurer that unemployment and sickness benefits have not been increased since they were introduced by the Labour Government in 1944. The present Government has no sympathy for the unfortunate people who require that form of assistance. Those rates should be increased in relation to the present value of the £1, which is now at the lowest level in its history, despite the fact that the present Prime Minister, during the general election campaign in 1949, promised the people that if he were elected to office, he would put value back into the £1. Old-age pensioners’ associations, which claim that the pensions should be 50 per cent. of the living wage, are not making an unreasonable demand. If it were granted, a pensioner and his wife who were living together would receive a living wage. Any amount that is less than that figure is not good enough. I support the claim of the old-age pensioners’ associations in this matter. The occupants of every home are entitled to an adequate living allowance.
I shall now discuss the mythical health plan of the Government, about which honorable gentlemen opposite have made so much fuss from time to time. The present Prime Minister, during the general election campaign in 1949, said in reference to health and medicine -
The real problem is that of the prevention of disease by adequate and proper food supply-
Fancy saying that to age and invalid pensioners who are compelled by this Government to exist upon a miserly pittance - by an attack upon the causes and the provision of those basic requirements without which no national scheme can succeed . . . we need to reduce the high cost of diagnosis in a specialized age by including clinics in hospitals.
Has the Government taken any action to reduce the high cost of diagnosis by including clinics in hospitals? That was just another empty promise. The right honorable gentleman added -
We must improve the supplies of milk and fruit and other fresh food.
The right honorable gentleman’s idea of improving the supplies of milk, fruit and other fresh food is to grant to pensioners only31 per cent. of the present basic wage. This Government has not formulated a health plan. No such legislation has been introduced while it has been in office. The Minister for Health (Sir Earle Page) is administering the present formulary under regulations that were introduced by the preceding Labour Government. The only alteration is the reduction, at the behest of the British Medical Association, of the number of drugs in the formulary from more than 800 to approximately 160. A pensioner who seeks medical advice from a doctor who uses the formulary must take the prescription to a chemist. Frequently he finds that the drugs that have been prescribed by the doctor are not contained in the formulary, and, consequently, he has to pay for the medicine. This meddling Minister for Health interfered with the system that was in operation in New SouthWales under which a pensioner could attend a hospital as an out-patient and, for the payment of 3s., could obtain medical advice and the medicine that was prescribed for him. That arrangement was cancelled by the present Minister. He told the pensioners that they could obtain attention from their local doctors, but a pensioner who obtains a prescription from his local doctor very often cannot obtain medicine free because the ingredients are not included in the formulary that is now in use. It is time that the Government provided free medicine for the pensioners. A health plan that does not at least cover invalids is not a health plan at all.
I refer again- to the unnecessary and unwarranted dismissal of 10,000 public servants. Nothing could be more ridiculous than the sacking of officers from departments which have been able to carry on efficiently during the last ten years only because their employees have worked overtime. How can such departments continue to provide essential services if, when they are so hard-pressed, they are deprived of large numbers of their officers? The investigation section of the Taxation Branch, for instance, has been suffering from under-staffing for a considerable time. In fact, the shortage of officers has been so severe that the section has not been able to perform its tasks efficiently. Nevertheless, there is going to be retrenchment within this office. Investigations that are necessary if the branch is to catch up with tax.scalers will be further hampered. I remind the committee that it is not the worker who does the scaling, because details of the wages of every working man and woman are supplied to the Taxation Branch in group certificates. The worker cannot escape his obligations,! but big business organizations are able to evade their just charges by manipulating accounts and furnishing incorrect tax returns. They not only unload a part of their tax bills on to the general public by charging high prices but also evade full tax assessments. Considerable .investigation work is necessary if such defections are to be uncovered. In fact, the investigation section of the Taxation Branch is already unable to cope with its work because of staff shortage. The Treasurer should not permit this state of affairs to continue. If all tax-sealers were brought to justice, the Government could probably reduce the incidence of taxation on the workers.
The intention of the Government to curb inflation by means of this budget will not be fulfilled. The Government has also described it as a defence budget. I believe that we need something more than the stockpiling of munitions if we are to provide for the proper defence of Australia. The Government is making the mistake of preparing for war instead of for adequate defence. It is diverting goods and services from the civilian market, which is already undersupplied, in order to establish a vast stockpile and to place the country on a war footing. That is very unwise in times of peace. Good lines of communication and plentiful supplies of food are the first essentials of a successful defence plan, but the Government has not made plans either to improve our lines of communication or to increase supplies of food. In fact, it has curtailed developmental work of this character by diminishing the amounts of its grants to the States, with the result that State instrumentalities are unable to prepare the good roads thai are vital to a sound defence plan as well as to trade and commerce. State governments have been forced to cancel water conservation projects and other undertakings that would be of importance in time of war because the Treasurer has not allotted sufficient funds to them. We have had five successive years of bountiful rains and, therefore, we have been able to maintain adequate supplies of such foods as wheat, dairy products and meat. We cannot rely upon such favorable seasonal conditions in the future. Prolonged droughts are not unknown in this country, and we should prepare now to meet the contingency of future seasonal disasters. Australia could be crippled by famine if droughts occurred in successive years. The influx of New Australians is not helping to increase the supply of food in Australia, and the immigration programme should be reviewed in the light of a prospective food shortage and also our housing shortage. The Minister for Immigration (Mr. Holt) should concentrate upon a policy of directing New Australians to our rural industries. Disaster would overwhelm us if war and famine struck Australia simultaneously. The nation would probably be annihilated. Instead of stockpiling munitions in the defence establishments and money in the Treasury, we should develop our second- ary industries and primary industries sufficiently to enable us to meet the demands of war if war should occur.
Silting suspended from 5.56 to 8 p.m.
– In my speech to-night I want first to deal with one or two special features of the budget. Then I shall make a statement on the Government’s economic policy generally fitting the budget into that pattern. But before I do that I shall deal with one or two of the special features. There has been an onslaught on this budget in some quarters, on the ground that it increases taxation, as it undoubtedly does. And therefore there are two questions to which I shall address- myself on behalf of the Government. The first is: Should taxation be increased? If it should, are the increases fairly distributed? I undertake to demonstrate that the answer to both of those questions should be “ Yes “. In the first place those who say that taxation should not be increased are, in effect, advocating a deficit budget; that is to say, an inflationary budget. The most cursory examination of the- figures laid before the committee by the Treasurer (Sir Arthur Fadden) will 3how that apart from any increases in taxes there would be, on this budget, a deficit of £46,000,000. That is a large deficit. Somebody may say that expenditure could be cut in order to eliminate that deficit. To that I reply that anybody who will trouble himself to look at the items of expenditure appendaged to the budget speech will see at once that very few of those items lend themselves to a reduction at all. Nobody would pretend that the defence vote ought to be reduced. Some might be heard to say, as they have been heard to say already, that it ought to be greater. Nobody would 3ay that the social services vote should be reduced; on the contrary, there has been and there will be those who say that it ought to be even greater. If honorable members looked through all the items of expenditure they would come to two items, one of them public works, and the other general administrative expenditure which as an item is substantially smaller than the deficit to which I have referred; but they would not find any item that lent itself to reduction in any real sense.
What has happened about works? The fact is that the works programme of the Commonwealth, which we agreed we would carry entirely on revenue, foi reasons that 1 will give, will this yew be only £3,000,000 or £4,000,000 greater than that of last year. This year it will be of the order of £106,000,000. Last year it was of the order of £102,000,000. In brief, our works programme appears practically static in terms of money and therefore, having regard to increased cost, our works programme has been cut in volume. That is not applied to any of the complainant States - because there are some complainant States at present - but it applies to the Commonwealth. The first question that the critic has to answer for himself is: Would he be prepared to make a substantial further cut in the Commonwealth works programme ? Would he be prepared to close out the Snowy Mountains hydro-electric project? Would he be prepared to bring to a. stoneend any further development of any description in postal services? The answer is perfectly clear. Nobody in this House, and I do not believe any student out of it, will say there is any further room for reduction of expenditure on. the public works account.
We are left, therefore, with only one allegedly reducible item, “ General administrative costs “, which, after all, amounts to somewhere between’ £30,000,000 and £40,000,000, and is therefore in itself substantially less than the deficit which the Treasurer contemplated when he began to compile this budget. I do not need to. remind honorable members of probable repercussions, because in another capacity in the House they have heard the discussion about the Government’s attempt - and successful attempt - to introduce an economy in general administrative costs. I do not suppose that I will hear anybody opposite say that there should be a further cut in the general administrative costs, which we do not control in terms of money and which, therefore, we can control only in terms of man-power.
The moment it’ is established that this budget represents the end result of a sincere attempt to curtail the reducible expenditure of the Commonwealth we are confronted by the fact that either revenue must be increased, or a deficit of £46,000,000 incurred. A deficit budget at an inflationary period like this would be a scandal. It would expose any government to the accusation that it did not care about inflation because it wa3 prepared to pour £50,000,000 of new money into the existing supplies and so aggravate the inflation. Therefore, I answer the first question, “ Yes, there must be increased taxation, unless we are to have an inflationary deficit budget “. How have we planned to obtain the increased revenue ? We have done so by proposals which bear justly on all sections. It could hardly be said by any honorable member - and certainly by no honorable member opposite - that in distributing the additional burden of taxes we have favoured the rich.
– Of course the Government has favoured the rich.
– The honorable member for Hindmarsh (Mr. Clyde Cameron) is the only man who would say that. One man says it. . I am rather astonished to be told that our budget favours the rich, because it is from that quarter that I have heard most of the protests against it. I have not heard any protests against it by the trade union movement.
– Oh, yes you have.
– Oh, no I have not. The whole trouble is that honorable members opposite felt grievously baulked when they read the budget, because they realized how heavy a burden would be placed on the richer sections of the community. They have, for example, complained very bitterly that at a time of inflation something ought to be done to impose some kind of ceiling on dividends of great corporations. I have heard that suggestion time after time. Under our powers, we cannot impose a ceiling on dividends, but what we have done in thi3 budget is to raise substantially the taxation on the distributable profits of companies, with the result that the new rates of taxes will put a severe check upon the increasing of dividends.
– It will raise prices.
– An honorable member from New’ South Wales interjects that it will raise prices; if that is so, it will be by permission of the McGirr Government. In the second place, the increased revenue has been obtained by curtailing the demand for capital equipment, a demand which as everybody who has studied this matter knows, is a demand far too great for the supply. There is no greater element in the present inflation than the exorbitant demand for capital equipment and the inadequate supply of it. Therefore, in the budget the Treasurer has made provision for alterations of the existing law in relation to special initial depreciation. A policy that was originally devised to encourage investment in capital equipment must now be reversed because we have too little capital equipment to meet the demand.
The taxation proposals in the budget affect the demand for luxury and lessessential goods. That has been achieved, very justly, but, I agree, not very popularly in some instances, by sales tax and excise increases, and by the increase of individual income tax - an increase which, as was pointed out last night, still leaves the rate of income tax on all relevant, rates of income in Australia favorable to us when compared with the rates that are in operation in our sister countries, the United Kingdom and New Zealand. The budget has affected the purchasing demand of large rural income earners, not because it is desired to penalize them but because it is desired to remove an advantage that has been and is being enjoyed by income earners in that group. That has been achieved by the partial abolition of averaging. I do not expect to hear anything from the other side of the chamber about this “ rich man’s government “ pandering to large income earners in the country.
Next, the budget by its taxation proposals has provided for the modern valuation of land for land tax purposes. No one can deny the justice of that in a time of high and rising land prices. Finally - and there has been some clamour about this - the budget provides for a substantial increase in the fees payable by broadcast listeners. If honorable members will take the trouble to look at the figures of revenue and expenditure in relation to broadcasting, they will find that all that the increase does is to reduce the loss on broadcasting, which is now being carried by general revenue. It does not entirely eliminate the loss, but it reduces it. Therefore, it prevents a new element of deficit, with all its inflationary effect, from arising. There is one final thing to be said on that matter. I have read a considerable number of newspapers and heard a good deal of discussion inside and outside the Parliament, but so far I have not heard anybody suggest a better distribution of the added tax burden.
– The Prime Minister will.
– Then it will come from somebody other than the honorable member for East Sydney (Mr. Ward). I turn from that point to the next one about which I want to say something. I invite honorable members to observe the effect upon the budget of capital works programmes and of payments to the States. I go further, and invite the attention of some outside critics, who are diminishing in number as time goes on, to this matter. In normal times, capital works, both State and Federal would be carried on by loan. That is one of the truisms of public finance. To-day, under inflationary circumstances, there is a movement away from loans and from fixed interest-bearing securities. That is inevitably io at a time when prices and costs are rising and when, therefore, the value of money is falling. One expects to see that kind of movement at a time like that. As the rise in costs and prices begins to flatten out, that movement away from gilt-edged investment will tend to disappear. Against the background of that simple truth, let us face the fact that, at this inflationary time in our history, with all the works that ought to be done in Australia, with our enormous arrears on the transport side, with our arrears of power, with our shortages of coal and with our defence preparations, we cannot expect to finance all of our works from loan money.
Let us look at the figures. This year, the States have a loan programme of £225,000,000 and the Commonwealth one of £106,000,000, a total of £331,000,000. Last vear, the loan market yielded £151,000,000, or £150,000,000 in round figures. If we got as much from the . loan market this year as we got from it last year, we should still, on those figures, have to find £181,000,000 from sources other than the loan market. Alternatively, if we did not find the £181,000,000, we should have to cut the whole pro gramme back to £150,000,000 for both the Commonwealth and the States. That would create chaos in all programmes and “would instantly involve damaging and widespread repudiation of contracts and of obligations. Therefore, it is clear that, until inflation is arrested or is in the process of being arrested, we must have enough revenue to find large sums for works. The effect of all those things has been completely overlooked by the critics. Out of a total of £927,000,000 expendsture in the budget, payments to the States are at the record figure of £161,000,000. What I shall call our underwriting liability to the States in respect of their works programmes, which is a liability to find the difference between what the loan market will yield and the £225,000,000 expenditure that has been approved may be anything between £75,000,000 and £100,000,000. Neither the Treasurer nor myself knows what it will be exactly. In addition, because we have remained out of the loan market and have left that market with its limited resources to the States, we have to carry £100,000,000 of Commonwealth works on the budget.
Let nobody pretend that he is grappling with this problem unless he decides whether we should have cut payments to the States. Does any person challenge us paying £161,000,000 to the States? Does he challenge us stands ing behind the States in this underwriting sense? Does he challenge us doing £100,000,000 worth of Commonwealth works this year? Unless he challenges one or other or all of those things, the net result is that between £336,000,000 and £361,000.000, or more than one-third of the entire budget, is made up of items of that kind. When people say in a broad, easy and sweeping fashion that we must not increase taxation but must cut something, let them face the real truth of the matter. If we cut those three things out, if we turn our backs upon our partners in the federation and tell the States that they must sink or swim as best they can, and if we adhere to the whole of our revenue and make no tax or other reimbursements to the States, we can, without raising an extra penny piece by way of taxes, have a high, wide and handsome surplus; but all of those items are entirely significant and are not to be avoided merely by the process of not looking at them.
I turn from those two matters to say something about the anti-inflation programme of the Government, because one of the statements that is most glibly repeated is that the Government has no programme about inflation. It is said particularly– not in this House, I agree, but outside - by those to whom an antiinflation programme means altering the exchange rate and nothing else. The people who advocate an alteration of the exchange rate in my experience never have anything to put alongside it. The Government’s programme is designed to deal with the real causes of inflation as far, of course, as they are internal to Australia. External causes are not matters that are within our jurisdiction, but as far as real causes are internal to Australia the Government is seeking to deal with them. Therefore, we have directed our programme, and have been directing it for a long time, to five elements. I do not wish to be tedious on this matter, but I take leave to state those five elements to the committee and to the country. The first is directed to increased production; the second, to increased procurement of goods from overseas; the third, to limitation of excessive capital demand by governments; the fourth, to limitation of excessive consumer demand for non-essentials, a’ demand which attracts too many resources to non-essential production; and the fifth, to diversion of resources of man-power and materials to enterprises of productive and defence importance. I shall take those five elements in order.
First, I shall deal with positve measures to increase production. It was very gratifying to my colleagues and to those who sit behind us in this chamber to hear the Leader of 1h*e Opposition (Dr. Evatt) last night at the penitent stool about production. His conversion to advocacy of production is tardy but welcome. After all, it is never too late to mend on such matters. But although it is tardy and although we hope that from now on we shall have his support in encouraging people to understand that one produces one’s way out of inflation far more effectively than by the use of any other technique. I desire in passing to recall that the Communists are the greatest enemies of production in this country and that, so far, the Leader of the Opposition has done nothing but protect them. With that slight recollection. I now wish to turn to the positive measures which the Government has taken to increase production. The first of them was the 100,000,000-dollar loan. We were told at one stage that it was either impossible or undesirable. The object of that loan which this Government negotiated was to bring here essential capital equipment which could not be obtained from non-dollar sources. The Australian Government is not the chief purchaser of the commodities that areimported under the loan. State governments and public instrumentalities are, for the most part, the authorities to whom dollars are made available. Honorable members will be interested to know, and they will see what a bearing it has on production, that under that loan 29,000,000 dollars have been made available for the purchase of agricultural tractors and other agricultural equipment; 24,000,000 dollars for heavy industrial crawler tractors and earth-moving equipment: 15,000,000 dollars for transport equipment, including locomotives; and 26,000,000 dollars for electricity generation and transmission-packaged units, as they are called. The balance is made up of plant and equipment for mining and manufacturing. That is. an impressive list of articles, every one of which has to do with production and vital transportation in Australia.
As the second element of a positive production programme I wish to refer to immigration, because there is applause for our immigration policy as well as criticism of it. Of course, there is always room for criticism of any policy so great in its scope, but we have specifically directed the immigration policy towards aiding the basic industries. Honorable members will be interested to know that 19,000 contract immigrants are now working in national undertakings such as rail, road, water storage and power projects, while 2,600 contract immigrants have been placed in the steel industry.
Accommodation for Commonwealthsponsored immigrants has been located to meet the labour needs of basic industries and services. For example, prefabricated houses from overseas are being erected on the south coast of New South Wales for British immigrant miners who will produce coking coal for the Port Kembla steelworks.
The third element of this positive policy of production is that this Government has encouraged the flow of imported scarce materials because a great deal of production in any country depends upon bow it can obtain the product of another country’s enterprise to use as its own material for its own production. We have encouraged the flow of imported scarce materials by relaxing import duties on essential materials and on prefabricated houses, by subsidizing the importation of coal and of houses, and by negotiating favorable allocations of scarce materials and equipment. I do not wish to weary the committee with a mass of figures, but I shall quote three items in order to indicate how fruitful and constructive this policy has been. For instance, let us take iron and steel.
– Pig iron !
– Pig iron then. All of the Communists call me that.
– Pig iron from Japan or for Japan?
– The honorable member would not know the difference. . I do not mind if one or two honorable members opposite swallow it.
– The right honorable gentleman thinks that everybody who does not agree with him is a Communist.
– The honorable member for Hindmarsh (Mr. Clyde Cameron) thinks that everybody who does not agree with him is a fascist. In 1948-49 this country imported 160,000 tons of iron and steel; in 3949-50, 415,000 tons; and in 1950-51, 685,000 tons. That is constructive talk, because steel has been one of the great basic shortages in Australia. Now let us take timber. In 1948-49 Australia imported 222.000,000 super, feet; in 1949-50, 240,000,000 super, feet; and in 1950-51, 375,000,000 super. feet. In the case of machinery, taking it in £l’s f.o.b., the figure has risen over the same period from £41,000,000 to £86,000,000.
I refer to these matters because they are conclusive evidence that under this policy which we have consistently applied we have been able to produce first-class results in adding to the instruments of production in this country, and it is only the instruments of production, mechanical and human, which will in the long run answer this problem for us.
Now I take the next item in our production programme, which is coal and steel production. As honorable members know, we have subsidized the importation of hundreds and thousands of tons of coal. Orders for a further 1,000,000 tons of coal have been placed abroad - all coal which we were, and are, willing to subsidize. But there is difficulty in securing shipping at reasonable rates. Therefore the Government, actively addressing itself to that problem, is at this very moment taking steps, some of which are complete, to secure needed shipping by both charter and purchase for the bringing of this coal to Australia. We have subsidized coal production at Callide. I do not mean that we have made a direct subsidy to the Queensland Government, but we have entered into an obligation to subsidize the two principal purchasers of Callide coal, the States of Victoria and South Australia. We have under way, and are vigorously pursuing with all the resources that we have, a large open-cut development which, when completed in a few years, will have added about 5,000,000 tons of coal a year to our supply in Australia. Coal production actually increased by more than 1,000,000 tons in the financial year that has just ended, and it should increase by another 1,000,000 tons in the current financial year. Ingot steel production in Australia in 1950-51 was 1,400,000 tons, which was 200,000 tons more than in the previous financial year.
I shall not labour these figures, but I invite honorable members to note that in all of these things there is proof that, to the extent that production is the answer to inflation, we have fruitfully concentrated our efforts on stimulating it. Then, apart from basic materials which might be described by economists as capital goods, we have deliberately, as a counterinflationary measure, encouraged the increased procurement of goods. The Government is of the opinion that Australian industries, at a time of the greatest under-supply, are in no danger of fatal competition from imported goods. We must, if we are to meet inflation and if we are to have a supply of goods equal to the supply of money, have a large flow of goods coming into this country. In 1948-49 the imports of merchandise f.o.b. amounted to £414,000,000; in 1949-50 to £536,000,000; and in 1950-51 to £742,000,000. On the present rate of flow of imports of merchandise into Australia the figure this financial year may actually exceed £900,000,000. That is all I want to say of that particular aspect of this problem. Anti-inflation programme item No. 1 is: Stimulate production. Item No. 2 is: Stimulate an increased supply of goods. I have dealt with both of these. I venture to say that we have shown very practical results in relation to them.
The third item; in an anti-inflationary programme is the limitation of excessive capital demand by governments. That sentence raises the whole issue so violently discussed by the Premier of Victoria in recent weeks. First of all I shall give honorable members some figures in relation to public works expenditure in the last complete financial year before tha war. In 1938-39 the public works of the whole of Australia, including public housing construction, amounted to £57,000,000. In 1950-51 that figure had risen to £312,000,000. Honorable members will realize that when the demand for capital investment on works has been multiplied by between five and six times in that period of time, and the nation’s population has not enormously increased, although of course it is perceptibly greater, when our natural resources have not become enormously greater, and the products of our basic industries are no: notably greater, the strain placed on the economy is tremendous. If we add to that a rise in private capital investment over the same period from £109,000,000 to £405,000,000, we see the consequences, and none of us needs to ignore them. The consequences are an excessive demand for labour, plant and materials^ bottle-necks and keen competition for available resources. All of these things are, of course, acutely inflationary in their effect. We, in short, believe that Australian governments - and I use the plural - are trying to do too many jobs at the same time, and the result is delays, high costs and acute inflationary pressure.
At the last meeting of the Loan Council the Treasurer and I attacked this problem. The States had brought in a works programme which they had, So they informed us, vetted with great care. But the programme amounted to more than £300,000,000. The whole of the loan market in the financial year that had just ended had produced only one-half of that amount. In other words, the States presented a loan programme double the established capacity, at that time, of the loan market. They had already agreed at a previous special loan. council meeting that public works ought not to be financed out of treasury-bills - that is to say, by creating new money out of the central bank at a time of inflation. We had, I say, agreed to that principle. There is no economist in the country who would deny the correctness of the principle. The States accepted that proposition and said, in effect, “ All right then, we must not have recourse to the central bank to create new money to add to the flow of purchasing power at a time like this “.
We all agreed at the same time that the loan market would not yield anything like £300,000,000. The Commonwealth said, and I still say that it was the proper thing for us to say, that in order to ease the reduction that was obviously coming in the States’ works programmes, we would finance our own works out of revenue, and would thereby leave the loan market to the States. .It is very curious to remember, in the light of the facts that I am reciting, that the Premier of Victoria, whether speaking his own mind or somebody else’s I do not know, is now denouncing us for injustice and harshness towards Victoria. All I can say is that we agreed to finance the whole of the Commonwealth works programme from revenue and that the
States could have the whole of the loan market to themselves for whatever it might produce. The Loan Council, faced with those facts, by a majority of four States to two, approved the reduction of the States’ programmes to £225,000,000 - that is to say, a reduction of their programmes of. £75,000,000, which was a reduction- of an unprecedented order. One of the majority of the States that agreed to the reduction was Victoria. So the programme was cut to £225,000,000 an amount which nobody believed the market would yield. Nobody believes it now. No one can see any reason why, in the present economic circumstances, we should expect to get from the market £225,000,000 instead of £150,000,000 which we got last year. Therefore, the Commonwealth, in order to prevent confusion and chaos, agreed to guarantee the amount of £225,000,000… To those who study the. history of Commonwealth and State financial relations that decision represents an important landmark. This is. the first time that the Commonwealth has, in effect, guaranteed the loan works programme of the States. The guarantee means that, to the extent that loan raising fall short, whether by £75,000,000 or £100,000,000, the Commonwealth will find the money and, let me add, will find it by non-inflationary means. It will find the money, not by discounting treasury-bills with the Commonwealth Bank, but by subtracting money which would otherwise be available for spending, that is, by taxation. No one was more eloquent in expressing his appreciation of what was being done than was the very Premier who is now squalling most loudly.
– Who is that?
– The Premier of Victoria. I . do not quite know on what flank we are being attacked. One section of the press declares that we should have clamped down still harder, and should have said, “ not a bean do you get beyond what the loan market provides”. If that had been done the Premier of Victoria would not have been standing alone. There would have been a chorus of protests from one end of Australia to the other, and public works programmes would have folded up all over the place. We did the reasonable thing. We said, in effect, that we would not underwrite what we regarded as extravagant programmes that were beyond practical realization. On the other hand, we would not cut. the States down suddenly to what the market would yield. In order to give an illustration of how fantastic some, of the statements on this matter have been, I point out that in Victoria, my own State-
– Mine, too.
– The honorable member’s too.
– You can both have it.
– Yes, the “Ayes” and the “ Noes “ both have it. In our own State of Victoria the Government is trying to spend on public works in one year an amount equal to half the figure at which the public debt of the State stood in 1945, 94! years after the inauguration of the State. Honorable members can see how reckless has been the approach of some people to this question.
Having explained the nature of our underwriting obligation, I now say - and I wish this to be noted in certain quarters - that it is not to be assumed that the Commonwealth will necessarily repeat its underwriting. We propose to call the States together early in the New Year to discuss their works programmes. We are not prepared to encourage States to enter into capital commitments indefinitely, as some might like to do, in excess of the amount of money which the public will entrust to them by loan. Indeed, we are not prepared to accept as a practice the burden and obloquy of imposing extra taxation in order to provide funds for State works programmes in excess of the savings of the people. It is in the light of these warnings that we propose to meet the representatives of the States early next year, and to say to them that the kind of thing which was inevitable this year should, be avoided in the future.
The next point is the limitation of excessive consumer demand for nonessentials, a demand which attracts too many resources to non-essential production. To this end the Government has taken certain steps which I could not have believed would be seriously challenged by honorable members opposite, because in their own day every one of them has enjoyed at least the vocal support of those honorable members. The steps actually taken to date are -
The tightening up effect of these measures has been very considerable. Many honorable members are well aware of this and of the influence which the measures have had in discounting demand. Because the procedures are selective, they reduce demand, or we expect that they will reduce demand, in the right places. There may be some errors of judgment here or there, but we expect the effect to be such as I have stated.
The last item is the diversion of resources of man-power and materials to enterprises of productive and defence importance. Apart from what I have said on government and private capital investment programmes, we have created three principal instruments. The first is a National SecurityResources Board, about which I should like to say a few words. It is a widely representative body which includes leaders of heavy industry, as well as the President of the Australian Council of Trades Unions. It also includes civil servants, some of them with administrative training, and others with economic training. The board has done a great deal of work, and has submitted valuable reports and recommendations to the Government. For instance, it has examined the whole subject of capital issues control, and has tendered certain advice. It has also reported on the immigration programme and, as the Minister for Immigration (Mr. Holt) will agree, a most valuable analysis was made in conjunction with another committee which has been dealing with the problem. The board has also reported on the creation of Commonwealth-States consultative machinery, on the rendering of assistance to basic industries such as coal and steel, on the Defence Forces equipment programme and on the marshalling of our resources for defence preparations generally. On all these matters the Government has been put into possession of most useful views.
We cannot allow the economy of the country to remain unbalanced and therefore inflation must be arrested. Inflation is the clearest proof of a want of balance in the economy. To some degree it has become necessary to divert national resources. We must divert people by indirect means. We must divert capital. Honorable members must realize that when capital is diverted it is inevitable that the people who use the capital will also be diverted. When we divert vital materials from one place to another some of the people must work on them in one place rather than in another. Do not let us act as schoolboys in relation to this matter. I suggest that the honorable member for East Sydney in particular, should not be too hasty in alleging that the Government is endeavouring to introduce industrial conscription. Industrial conscription was not provided for in the Defence Preparations Act and this Government is not talking about introducing industrial conscription. It is talking about diverting resources from non-essential industries to essential industries. If honorable members are not in favour of that plan let them tell the people that they are in favour of inflation continuing indefinitely.
I have already referred to the second instrument - the Defence Preparations Act. The third instrument is the CommonwealthStates joint consultative committees, which have been set up with the concurrence of the seven governments of Australia. A committee on power, a committee on transport, a committee on materials, and a committee on agriculture are already functioning and it is anticipated that they will make reports containing lists of priorities which will go far to enable resources to be properly directed and concentrated. If basic materials can be concentrated for the purpose of doing basic jobs people will work with those materials on those jobs instead of wasting them in jobs that do not matter. That is the whole principle of a diversionary process.
I shall now turn to one or two special arguments that have been used in this debate. It has been stated that the surplus of £114,000,000 disclosed in this budget is not a true surplus because it will be spent on State works. Again, one hardly knows from what angle to anticipate the attack because one gathers from the Leader of the Opposition (Dr. Evatt) that he considers that the surplus will be much more than the figure stated, but the critic to whom I now refer has said that there will not be a surplus. That argument has been put forward, not by people who believe in having a deficit, but by people who think that they believe that there ought to be a surplus in the budget at a time such as this for sound economic reasons.
I have shown that controllable expenditure has been reduced as much as possible under the present circumstances. Therefore, the surplus could only be made a net surplus of £114,000,000 with no charge against it for State works by one of two means. Either the Government could pay no works money to the States beyond what the market will provide; or it could increase taxes still further so as to make the surplus, not £114,000.000 but £214,000,000 so that it might then pay £100,000,000 to the States and have a net surplus of £114,000,000. Taking the second idea first- that the Government should further increase taxation - the Government did not believe that it could reasonably ask the people to accept such a burden. Taking the first idea of reducing the amount to be paid to the States by repudiating our obligations to them under the Loan Council agreement, I say that not only will the Government not repudiate its arrangements, but it does not believe that it could reasonably ask the States to accept such a burden so suddenly in this financial year. Having regard to the amount of their commitments for firm orders for plant which has been ordered overseas, there is no doubt that to reduce the State programmes at once to £125,000,000 or £150,000,000 would have wrecked their plans and practically brought their works programmes to a standstill. In this respect, as in- every other respect, this budget is both realistic and moderate.
It has been said by the Leader of the Opposition, who is much more apt to produce a phrase than an idea, that this budget is a sort of blueprint for depression. That statement is dangerous nonsense. The Opposition really ought to make up its mind, if it has a mind to make up, on any problem that involves the economic state of the country. I have noticed its modern opposition to the Premiers plan with great interest. I have thought it courteous to forget that there would have been no Premiers plan without the consent of a majority of Labour Premiers and a Labour Prime Minister and have concentrated on the fact that it is now the modern idiom of the honorable gentlemen opposite to say that the Premiers plan was wrong and that the truth is that in a depression the Government ought to budget for a deficit; that it ought to use central bank credit for works ; and that it ought to extend its public works programme to the limit of practicability. There is great force in that view but one cannot hold two inconsistent views at one and the same time. If honorable gentlemen opposite believe that in a depression the Government should budget for a deficit and use central bank credit - that is to say create new money and expand the public works programmes to the limit of its physical capacity - will they tell the people that they regard the same medicine as appropriate for an inflationary boom?
Let us compare the circumstances of 1930 and 1951 while honorable gentlemen opposite are chewing over their ultimate answer to that grim question, in order that, once and for all time, it may be quite plain that all this talk about a blueprint for depression is wicked and dangerous nonsense. There was great unemployment in this country in 1930, while to-day there are far more jobs than men. In terms of employment, the positions are at the poles. In 1930, Australia had international reserves - London funds in particular- of £58,000,000; it now has international reserves of £843,000,000. Our export income in 3930 - I am leaving out gold because it is not material for the purposes of this comparison - was £90,500.000; in 1951 our export income was £983,900,000. In 1930 the sum total of the personal income of Australiana was £557,000,000; in 1951 it was £2,916,000,000. The money in the hands of the public - I speak of notes and bank deposits- in 1930 was £567,000,000; in 19j1 it was £2,447,000,000. I have only to refer to those figures - and I invite every honorable member to look at them when they are recorded in
Hansard - to show that the only people who have talked mischievous nonsense about a depression in 1951 are those who want to see a depression come about.
The last matter about which I want to say something - I have saved the best for the last - is the speech that fell from the Leader of the Opposition last night. I think it was Lord Randolph Churchill who once said that it was the first duty of the Opposition to oppose, and as a former Leader of the Opposition I am not unfamiliar with that duty and its performance.
Mr. Calwell interjecting,
– I am talking about the present Leader of the Opposition and not the prospective one. I am bound to say that the present Leader of the Opposition must be regarded as the greatest opposer of all time. Let me prove that statement before I sit down. In the first place I gather, though I may be wrong, that lie was opposed to Sir Douglas Copland. I may be doing the right honorable gentleman an injustice. Anyhow, I may say with perfect courtesy that the Leader of the Opposition, in relation to his debate on this matter, shunned the company of Sir Douglas, who is a very distinguished Australian from many points of view. He was Prices Commissioner under my own Government in 1939. He was, mav I recall to honorable members opposite, economic adviser as well as Prices Commissioner to the late Mr. Curtin and the late Mr. Chifley, and T venture to say that he enjoyed the confidence of both of them. The Leader of the Opposition, with that fascinating logic that has puzzled me for many years, in what logicians would call i curious syllogism, says, “ I do not like Professor Copland; Professor Copland supports this budget; Professor Copland, because I do not like him, must be wrong; therefore the budget is wrong “. That is a pretty fair summary of half the rambling and meandering obscurities of the right honorable gentleman to which we have listened in this debate. In the second place, the Leader of the Opposition is opposed to a reduction of Commonwealth administrative expenditure. He has made that abundantly clear. In other words, he agrees that we cannot balance the budget by reducing expenditure. I do not do him an injustice when I say that I thought that that was clearly what he meant to convey. Indeed, on the contrary, he thought that administrative expenditure should be increased because he said that there should be bigger subsidies, more extensive social services and more civil servants. On those three items he is all for an expansion of expenditure under the budget; but although he is opposed to a reduction of expenditure, and on the contrary favours increased expenditure, curiously enough, he is also opposed to an increase of taxation. Indeed, he thinks that taxes should be reduced. He cannot balance the budget by reducing expenditure and he is unwilling to balance it by increasing revenue. How, then, does he propose to balance the budget? It is obvious when one looks at these figures that the right honorable gentleman favours a budget deficit which can be financed only by raising the wind, through the central bank, by the issue of treasury-bills. He favours increasing the supply of money as a cure for inflation! In the third place, he opposes the reduction of the State works programmes, unless, of course, he is quarrelling with Mr. McGirr and Mr. Cain. As he opposes increased taxation, if he is at all logical in his approach to this matter he must favour the financing of a loan deficit by the Commonwealth Bank by the issue of treasury-bills. This gentleman, who talks about inflation) has made it abundantly clear that in respect of revenue and loan deficits he favours the raising of the wind in great volume by the issue of treasurybills.
Finally, I gather that the Leader of the Opposition is opposed to the recent rise in the bond interest rate. I trust that I am not distorting what the right honorable gentleman has said on that subject. I take his silence to signify his consent to the accuracy of what I am saying. I gather that his references to the recent rise in the bond interest rate mean, as honorable members will see at once, that he accepts either the use of central bank credit on the grand scale to support the bond market and force down the interest rate - ‘and all those who are familiar with these matters are aware of what enormous central bank operations would be involved in such a proposal - or alternatively, that he would like loans to fail because of an unattractive interest rate, which would then put responsibility for the bulk of the loan programme on to the .central bank. Every argument used by the Leader of the Opposition was an argument against anti-inflationary measures and an argument for inflation.The one thing to which the Leader of the Opposition, and presumably his party, are not opposed, is inflation. Of course they are not opposed to inflation because the right honorable gentleman recognizes inflation as the substance of his political stock-in-trade. The more our people get to know this budget and see its effects, the more will they reject the Opposition and the more will they rally in firm support of the action taken by the Government.
Mr. Curtin interjecting,
– Order ! The hon- .orable member for Watson (Mr. Curtin) must remain silent. I warned him repeatedly yesterday and I have repeated that warning again to-night. He will be dealt with if he offends again. Honorable members on the front Opposition bench have kept up a continual flow of conversation. Those who have offended should apologize to their colleagues who sit behind them.
.- In spite of the long, dreary and uninspiring speech of an hour and ten minutes in which the Prime Minister (Mr. Menzies) explained nothing and clouded everything, there is still only one word in the English language that adequately describes this budget. That word is “ phantasmagorical “. Well may Benjamin Disraeli, whose words should be acceptable to Government supporters because he was the founder of the modern Tory party in Great Britain, say on the 17th March, 1845-
A Conservative Government is always an -organized hypocrisy.
The 17th March was rather an appropriate day for such a- provocative statement to be made. What Disraeli said more than 100 years ago is still true of all conservative parties. It applies whether they are in office or out of office. It applies all the time because all the time they are pretending to be something that they are not. The reason for that attitude is obvious. If they want to achieve power they must pretend to be a part of the people. But, as the facts of this budget indicate, our Australian tories are certainly not that.
This is an extraordinary, gruesome, and fantastic budget. It has shocked, bewildered and amazed the people of Australia. It is not merely unpopular; it is unsound. It will destroy the standards of life that it is supposed to be defending. It will encourage and stimulate the inflation of our currency which it is alleged to be designed to combat, and thus it will further reduce the spending power of the ordinary people. It is noteworthy that that spending power is directed not to so-called luxuries, but to ordinary necessities. Far from being deflationary in its effect, the budget will accentuate the spiral of prices of almost all commodities and aggravate the widespread and deep-rooted discontent of a bitterly dissatisfied and deeply resentful community. The combined efforts of the pro-Menzies anti-Labour press will not quieten the people.
– I wish that you, Mr. Chairman, would protect me from these Communist interjectors on the ministerial bench. As you know, every interjector these days is naturally a Communist. Without a shade of doubt this is the most dreadful budget that has ever been presented to the Australian Parliament. The burdens that it imposes are harsh, savage and unnecessary.
– It is a bludger’s budget.
– The honorable member for Hunter (Mr. James) will withdraw that remark. The word he used is unparliamentary and must be withdrawn.
– After having had the pleasure of saying it, I withdraw it.
– Consider now the action of the Government in dismissing 10,000 public servants, and those who are old, sick or incapable of finding other employment. The Government believes that Australia will be saved by sacking 10,000 people from the federal pay-roll. We do not need to sack that number to save the country; all we need do is to sack twenty: the twenty members of the Menzies Government. If that is not done then the depression that the Prime Minister talks about might strike Australia by about next June. The Treasurer (Sir Arthur Fadden) seeks in his budget to protect the chosen few, in spite of all the Prime Minister’s pretences to the contrary. The interests of middle-class income earners and all salary and wage groups have been neglected by him. The Government of which he is the financial mouthpiece believes that the lives of the masses of the people must be made as uncomfortable and as insecure as possible in order that the workers may be made to work harder and faster. That is the same old capitalist technique again being put into practice. The Treasurer is not a bad man, but he is a man full of foolish notions and prejudices. He clings to what are called “ sound economic principles “, but in the depression they were generally found to be merely superstitions. His education and experience have been gained in commercial fields and therefore when matters of great public moment are under discussion he always finds himself out of his depth. He is maladroit and fatuous, and is probably the worst Treasurer that this nation has ever known. This speech is not a diatribe ; it is a diagnosis.
There is not one word in this budget about communism. One should have thought that, as the Government stated during its last two election campaigns that the Communists were responsible for everything that was wrong, some mention of them would be made in the budget. Communism is a bogy that the Government uses during elections and forgets during the time between elections. Th Government was indelicate enough to choose the 22nd September for the holding of its precious referendum. That day happened to be the birth day of the late Joseph Benedict Chifley and the Government got the answer from the people that Joseph Benedict Chifley would have wanted the people to give had he lived until the anniversary of hia birth. If the Labour party had introduced a budget like this, honorable members can imagine how my honorable friends the Vice-President of the Executive Council (Mr. Eric J. Harrison) and the Postmaster-General (Mr. Anthony) would have raved and ranted, denounced and decried with all their histrionic art such a shocking budget. The Prime Minister, always an enthusiastic pleader for big vested interests and always the revered idol of every section of monopoly capitalism, has defended this budget. He made heavy weather of his defence and sent a. lot of his own supporters to sleep. I have certainly stirred them up, because like every other Labour supporter I see the position clearly and tell the truth as I see it. The Prime Minister sees virtue in his budget, but only a month ago he said it would be a “ horror budget “. To-night he said that it is a good one. He charges the Leader of the Opposition (Dr. Evatt), who lias always defeated him in the High Court, where logic is valued perhaps more than it is in this chamber, with being illogical. The right honorable gentleman was himself illogical to-day in his presentation of so-called facts.
Not to be outdone in making the flesh of the people creep, at Brisbane on the 24th July last, the Treasurer said -
My budget will be as real and as unpleasant as a dose of medicine. The budget certainly will not be pleasant, it will be most unpopular.
The Treasurer was certainly right. This budget is certainly most unpopular. The Prime Minister said to-night that there was no reason why every section of the community except the very few rich people should not be perfectly satisfied with the budget. When the Prime Minister was Treasurer in 1939 he introduced the first budget in the history of Australia to reach £100,000,000. To-night as Prime Minister he defends a budget that will take over £1,000,000,000 out of the pockets of the people. He says that it is necessary; but the economy of the nation cannot stand such a strain. The budget does two things. It increases the pensions payable to certain individuals who deserve all that they are going to get and probably a lot more, and at the same time, it makes levies in the form of increased income tax, company tax, sales tax, and excise duties which are completely indefensible and unjustifiable. For the first time in history, a budget will take more than £114,000,000 out of our pockets, not because the Government needs all that money for specific purposes, but because it believes that some of the money will be safer in the possession of the Treasurer than in the hands of the public. This is the new economic policy that was referred to by the Leader of the Opposition last night. The people are being told that it is dangerous for the Government to leave surplus spending power in their possession. That is the burden of the Government’s case. The people may waste that money, so the Treasurer is to confiscate it and store it away in some old oak chest. The truth is, of course, that the Treasurer will spend it - every penny of it. When the financial year has” ended, there will be a deficit and not a surplus. Every man, woman and child in the community, including the newest born babe, is to contribute £15 to the Treasurer because he considers that he knows better than any one else what should be done with that money. We have to go back to the days of the “ tragic Treasurer “, now the Minister for Health (Sir Earle Page) to find a parallel to the present plight of the nation. , To-day, thanks to mismanagement by this Government, we have an empty treasury, an exhausted loan market, an estimated deficit in our balance of payments for this financial year of no less than £300,000,000. That estimate was made by Professor Sir Douglas Copland a few days ago.
– I thought that the Opposition did not believe Sir Douglas Copland.
– I can show the Treasurer where he obviously does not agree with the noted professor. This Government, which cannot think for itself, follows the advice of Sir Douglas Copland, but with certain qualifications. It is not game, for instance, to increase interest rates on Go vernment loans and later, presumably on housing loans, as Sir Douglas Copland has suggested. It will not seek Commonwealth prices control as Sir Douglas Copland has urged as part of his eight-point programme; but, as the Leader of the Opposition has shown, the Government’s policy is closely allied with much of what Sir Douglas Copland has publicly advocated. In the closing days of the Bruce-Page Government of unhappy memory, Australia had an empty treasury, an exhausted loan market, an adverse balance of trade, and a wrecked economy, and the task of cleaning up that mess was left to a Labour Government just as a Labour Government will have to clean up the mess that is fast being made by the present Administration. In April of this year, when the present Parliament was elected, the Prime Minister used these words -
This is not the occasion for a new policy. What we ask for is a bare chance to carry out our existing policy; in the sound Australian phase, a “ fair go “.
What about the Government giving the people of Australia a fair go? What about it giving the people of Australia an opportunity to say at an election or at a referendum whether they want this outrageous budget? Honorable members opposite will not accept that challenge any more than they would agree to a referendum on Commonwealth prices control, the introduction of which would do something at least to arrest inflation by restraining the cupidity, greed, and rapacity of the people who pay the election expenses of the Liberal party and the Australian Country party. I shall tell the Treasurer the reason why inflation has galloped in this country in the twenty months that have elapsed since he became Treasurer of the Commonwealth. The Government has allowed the trading banks to increase their advances from £200,000,000 to £500,000,000. It has allowed some of the biggest companies to water their stock by issuing bonus shares totalling £14,000,000 or £15,000,000. In addition, it has increased the amount of money advanced by the Commonwealth Bank on treasurybills from £330,000,000 to £420,000,000. Yet the Prime Minister has asked to-night “ Do you want this Government to dis- count more treasury-bills with the Commonwealth Bank to help the Victorian Government and other State governments ? “ No wonder the Prime Minister described the budget as a horror budget and the Treasurer said it would be most unpopular ! I can well imagine the scene in the Cabinet room when the final decision was made, I can see the Prime Minister turning to the Treasurer and using the words that Madame Pompadour once addressed to her royal patron, Louis XV., “After us, the deluge”. If the right honorable gentleman did not say that, he should have said it because this budget will certainly seal the fate of the anti-Labour parties in Australia for at least a generation. Is it any wonder that Mr. Withall, the director of the Associated Chambers pf Manufactures, has placed on record the opinion’ that the Prime Minister’s approach to the problems of economic stability shows an immature mind? I am sure that the Prime Minister will not mind me reminding him that, in his 1949 policy speech, speaking as Leader of the Opposition, he said- -
The Commonwealth’s taxation revenue is £200,000,000 more than in the most critical year of the war. We still believe that the rates of taxation must be steadily reduced, as national production and income rise, and as economics are effected in administration. . . The greatest task, therefore, is to get value back into the £1, that is, to get prices down.
To-night, the right honorable gentleman has endeavoured to justify increases of taxes of all kinds and increased budget appropriations the total of which is more than £400,000,000 greater than those sought in the budget of 1949 which he criticized and condemned. The last Chifley Government budget amounted to more than £500,000,000. The Fadden budget last year totalled more than £700,000,000. To-day, we are confronted by a budget which reaches the enormous figure of £1,041,000,000, yet the Government pretends that it wants to reduce taxation and to put value back into the £1 ! The Treasurer and the Prime Minister might well ponder on the lines in Sir Walter Scott’s famous poem, Marmion -
Oh, what a tangled web we weave When first we practise to deceive.
This Government has deceived the nation. It has deceived the Parliament, but it will get the support of the Parliament because it has a majority in both chambers, and its supporters are afraid to do otherwise than back the Government. Naturally, honorable members opposite want to stay in office as long as they can because they know that after them comes the deluge. The tories have a facility that members of the Australian Labour party do not have. They have a delightful facility for being able to ignore facts and shun realities; but the ordinary people who have to face the realities know very well that they cannot meet the exactions of this Government. The Treasurer, when leading the Australian Country party in Opposition, promised reduced taxes as did the Prime Minister. He said -
We promise that a competent review will be made of the incidence of indirect taxation, because we recognize the necessity for sensible reduction in the many cases where such reductions would arrest the upward trend of living costs.
Since the Treasurer has been in office, he has done nothing but pile . burden on burden upon the unfortunate people. The Government cannot justify this budget on the ground that we are at war. tn 1943-44, when the Chifley Government brought down its record budget of £719,000,000, £544,000,000 of that amount was expended on the armed forces, in which over 500,000 men were serving at that time. To-day, we have not 500,000 persons in the armed forces or, indeed, any number of a magnitude that would justify an expenditure of over £1,000,000,000 in the current financial year.
The budget that we are now asked to approve represents a scheme of legalized brigandry. The Government is budgeting for almost double the expenditure that the last Chifley Government budgeted for and the impositions involved in it will bear harshly on all sections of the community. The Government won its way to power on false pretences. It proposes to take £117,000,000 in sales tax whereas the Chifley Government in 1949 collected only £43,000,000 under that heading. This Government proposes to raise £100,000,000 by way of excise duty whereas the Chifley Government collected only £66,000,000 under that heading. Thus, the Government is not reducing, but increasing the burdens on the people. The Chifley Government from 1942 to 1949 successively reduced taxes of all classes, and when it left office it had eased by £186,000,000 a year the financial burdens that had been placed upon the people as the result of the recent war. The Menzies Government has grabbed all that and more back again and, unfortunately for the nation, the end is not yet. If this Government is called upon to present another budget it will be even worse. But there always comes a day of reckoning in a democracy ; and when that day comes for the members of the Twentieth Parliament the number of members of the Liberal party and the Australian Country party who will be left in the new parliament will not be worth reckoning. Honorable members opposite, can whistle in order to keep up their courage, but none of them is prepared to defend the Government, and to present the facts to the people in his electorate, in the presence of a representative of the Labour party. In that respect we shall see as much of honorable members opposite as we saw of them during the recent referendum campaign. This budget has been criticized and condemned throughout the length and breadth of Australia. I have not yet heard one person who has been prepared to defend it.
– The honorable member has not read the Bulletin.
Mr.CAL WELL. - I never read that journal because I will not subscribe for fascist literature. The Government has played the people false and has forfeited whatever confidence they placed in it at the general elections in 1949 and 1951. I am certain that if a general election were held, with this budget as the issue, the Government would be annihilated. No government has a right to hold office if it does not possess the confidence of the people. Any government that continues in office after it has lost the confidence of the people perpetrates a fraud upon democracy. A government has nothing better to do than to honour its election promises. If it does not do that it governs under false pretences; and if it does something in opposition to promises that it has made to the people it becomes a menace to democracy and should be destroyed. All I have to say in conclusion, because my time is nearly up-
Government Members. - Hear, hear !
– But the time of the Government also is nearly up. For the good of Australia the Menzies-Fadden axis must go.
– The honorable member for Melbourne (Mr. Calwell) has just given one of his usual dissertations. Ever since he was compulsorily removed from the treasury bench by the decision of the electors on the 10th December, 1949, he has been prophesying disaster for the country and his return to office. He had an opportunity to fulfil the latter prophecy as recently as April last, but the people rejected him and his colleagues just as decisively as they rejected them eighteen months earlier. The honorable gentleman says one thing when he is in office, but quite another thing when he is out of office. I have in my hand copies of advertisements that were inserted in the press by the Chifley Government in 1948 and 1949. The honorable member, as Minister for Information in that Government, was responsible for their publication. One of those advertisements reads -
Save this way -
Buy only what you really need. Avoid luxuries. Get full value.
Buy for cash always.
Invest in Commonwealth loans.
Another advertisement read -
Envy can’t bring the things you want! Savings can!
Another advertisement told the people -
We are burning the candle at both ends. That’s the reason for many of to-day’s high prices and shortages.
The letterpress in one of those advertisements read -
How are we to eliminate shortages of goods we really need? Obviously, the only answer under to-day’s conditions is to concentrate our available resources on the production of essentials and to postpone the making of luxury articles until later.
That is exactly the purpose of the budget that is now before us. Perhaps the most delicate advertisement that the honorable member, when he was Minister for Information in the Chifley Government, inserted in the press was one which depicted a dainty young lady to whom was applied the following verse : -
A wise young wife ashopping went.
The more she saw the less she spent.
The less she spent the more she saved
And now with gold her future’s paved.
I have quoted those advertisements because I intend to show how inconsistent the honorable member has been. What he said in those advertisements was perfectly correct and in the interests of the nation. No supporter of the Government will quarrel with him on that score.
– Why complain ?
– I am not complaining. I direct the attention of honorable members to the fact that after the honorable member for Melbourne was ejected from office, and despite the fact that he had inserted those advertisements in the press urging people to save as a means of overcoming shortages of goods, he addressed a meeting in the Brighton town hall on the 15th February last at which, according to a report published in Labour Call, he said -
Buy all you can. Don’t save your money because the position is going to be desperate.
He attempted to give inflation a further impetus as soon as he was ejected from office. His veritable twin, the honorable member for East Sydney (Mr. Ward), when addressing a meeting with the honorable member for Melbourne in the Collingwood town hall said -
Inflation will gallop soon.
The pair of them were going to give inflation a good spur if they could.
A very serious job confronts the nation. We have the responsibility of meeting our defence requirements and of protecting the interests of a vast number of thrifty people in this country whose welfare is being increasingly endangered so long as inflation is allowed to go unchecked.
It may be necessary for me at this stage to direct attention to some of the causes of inflation that are outside the control of any government and have mainly occurred Since this Government assumed office in 1949. The greatest impetus to inflation was given by the outbreak of the Korean war in June, 1950. The Commonwealth Statistician has made avail able to me a list of the prices of basic commodities in June and in December of that year. The price of wool took a huge inflationary jump because the democracies had become aware of the aggressive aims of the Communist countries, and had started to stockpile basic materials and to rearm themselves as fast as they were able. At the outbreak of the Korean war the price of wool was 78d. per lb. Six months later it had risen to 129d. per lb. The price of rubber rose in the same period from 2Sd. to 60d. per lb.; cotton from 36d. to 4od. per lb. and lead and zinc from £119 to £200 a ton. Those are the factors that gave such an impetus to the inflationary spiral and created conditions outside the control of any government. That the value of the £1 has undoubtedly been slipping cannot be gainsaid, but that has been due in a large measure to circumstances completely outside our control.
However, certain things are within our control, and an obligation rests upon the Government to give its attention to them. Such matters have been dealt with by the Treasurer (Sir Arthur Fadden) in the “budget. A most serious position that must be considered is the grave lack of balance in Australian industry, a concentration on the manufacture of nonessential goods to the disadvantage of essential goods. For example, it is easy for a young couple to purchase one of half a dozen brands of refrigerators, or one of 50 brands of radio sets, but they cannot obtain roofing materials for the house that they wish to build. It is because of that particular lack of balance in our industries that the Government must, by its financial policy, endeavour to divert the concentration from nonessential production to the more essential industries.
We face a grave situation in’ our food requirements. Whilst the output of basic commodities is at a standstill, expenditure on many kinds of frippery things that we can well do without has’ been enormously accelerated. Whereas the production of butter was 200,000 tons in 1940 it was only 160.000 tons last year. Yet our population increased by 20 per cent, during that decade. Wheat-growers sowed 14.000.000 acres in 1940 and only 12,000,000 acres last year. Many of our industries are reaching a point at which we shall have little surplus for export. At the moment such a position may not be a matter of grave concern to people who see no reason for concern so long as we have sufficient for our own requirements. That view is fallacious. Unless we have a surplus for export we shall not have funds with which to buy essential requirements, such as rubber, oil, cotton, tea and other things that we cannot produce or manufacture here.’ A critical situation is indeed developing as the result of the diversion of labour and materials from essential industries to all kinds of non-essential production.
The picture may not be so gloomy for some persons. The Sydney Daily Telegraph to-day published a list of New South Wales Government undertakings, the operations of which had been examined by the Auditor-General. His report on them was laid on the table of the Legislative Assembly yesterday. The document makes interesting reading, and should give people cause for serious thought. He points out that the State brickworks has reduced its accumulated loss to £467.
– That must disappoint the Postmaster-General.
– I. shall not disappoint the honorable member for East Sydney (Mr. Ward) shortly. The Auditor-General also points out that the loss on the production of tiles is now £660,000. The State coal mine at Lithgow made a substantial profit of £237 last year. I promised that I would not disappoint the honorable member for East Sydney, who, I know, is interested in many other things. The Auditor-General points out that the State lottery showed a profit of £2,852,245 last year. Whilst the production of butter is declining in New South Wales because of a withdrawal of manpower from the dairying industry and the disappointment of producers at their failure to obtain a reasonable price for their commodity, the number of lotteries conducted in that State last year wa3 264, compared with 237 in the previous year. On an average, five lotteries are held weekly in New South Wales. Perhaps the Auditor-General paints the picture even more brightly, but my purpose in referring to such matters is to cite instances of our crazy economy, and of the kind of things upon which a Labour government places emphasis. I am endeavouring to show that the Treasurer in his budget this year, has tried to change the trend that has been developing. The Auditor-General reported that the turnover on racing last year amounted to £82,073,200. The State government, which imposes a tax on every betting ticket, received £4)10,000 from that source last year. The greater the volume of betting, the greater is the revenue return to that Government. Yet Opposition members tell us that the small impost that is represented by the additional tax payable during this financial year, amounting to approximately £2 10s. for a man in receipt of £500 or £600 per annum, cannot be borne. I shall indicate the burdens that people in other democratic countries have to shoulder in order to fulfil their obligations to prepare for defence.
– The honorable member for East Sydney mouths the usual stuff that appears in the Tribune. He expresses the view that this additional money is for the purpose of preparing for war. I tell him that it is for the purpose of preventing war that the democratic nations are arming to-day. Preparedness is their best insurance against the outbreak of war. Indeed, it is their only insurance, and they are well aware of that fact. Does anybody imagine that the United’ Kingdom, which was battered to pieces by bombs during World War II., wants to engage in another war? Does anybody imagine that Australia wants to be involved in war? Because we are expending such a large part of our national revenue in preparing against such an eventuality, it is suggested that we are preparing to engage in an aggressive war. That is merely the Communist line. If we wish to prevent war by becoming potentially stronger than the nations that threaten us, we can succeed only if each individual in every part of the Western democratic world makes sacrifices. The United States of America ii expending enormous sums of money on armaments and has introduced a system of conscription under which men may be required to serve in any part of the world and must undergo training for a period of not less than two years. Great Britain, starved of man-power and obliged to exert itself to the utmost in order to export sufficient goods to enable it to buy large quantities of food, is putting into camp for periods varying from eighteen months to two years, men who could well be employed in vital manufacturing industries. Yet this Government encountered the bitterest opposition from the Labour party when it introduced its plan to train young Australians in camps for six months altogether over a period of five years!
– Of course! They would be better employed in productive occupations.
– I have read that in the Tribune, too. The honorable member invariably follows the Communist line. I have read all this propaganda. It is “Warsaw peace congress stuff. The Communists say, “ Do not let the democratic countries rearm; tell them not to prepare; wait until Stalin is ready and able to strike ! “ We shall never be ready if we take heed of that sort of propaganda. It is the “ Commo” line and we are familiar with it. Anybody who talks like that only serves Stalin’s purpose.
Should a war occur, which God forbid, . Australia will fall like a ripe plum into the lap of the enemy if the democratic countries are defeated. Therefore, we must play our part, man for man and £1 for £1, with Great Britain, New Zealand, South Africa, Canada and the other democratic countries. I shall compare the taxes that are levied in Great Britain and New Zealand with those that the Government proposes to levy under this budget, in order that honorable members and the people may judge the severity of the sacrifices that Australians are being called upon to make in the interests of their own security. There has been much talk about the sacrifices that the Government proposes to enforce upon the people. In Australia, under the new budget, the excise on a packet of cigarettes will be ls. 6d. The Opposition says that that is a terrific amount. But the charge upon a similar packet of cigarettes in the United Kingdom is 2s. lid. The tax on an ounce of tobacco in Australia is ls. 3d. The levy in the United Kingdom is 3s. 6d. Furthermore, that impost is levied by a Labour government. The Labour party in the United Kingdom is prepared to do its job. It is not tainted with communism as is the Labour party in Australia. I shall make some further comparisons in order to show how light are the burdens that this Government proposes to place upon the Australian people. The excise charge on a bottle of spirits in Australia is lis. The comparable charge in the United Kingdom is 23s. I have heard a great deal of wailing and gnashing of teeth from honorable members opposite about the Government’s sales tax proposals. They complain of the sales tax on motor ears when, in fact, every motor salesman in Australia has a list of orders that will take years to fulfil irrespective of the prices that may be charged for the vehicles. Anybody who wants to buy a Holden motor car to-day knows that his name will have to remain on the waiting list for two or three years, or perhaps longer, before he can obtain delivery.
When we compare the Government’s proposals with the rates of tax that are applied by the Government of the United Kingdom, we must acknowledge that they are relatively insignificant. In the United Kingdom, purchase tax on motor cars is levied at the rate of 66§ per cent. The sales tax rate in Australia is only 20 per cent. I shall not discuss the whole list of items, because it would merely continue to tell the same story. The truth is that the sacrifices that Australians are called upon to make are light by comparison with those that must be made by our partners in Great Britain, to whom we shall look for assistance and by whom we must stand in the event of war. A comparison of rates of direct tax also discloses that Australians are not being dealt with harshly. For example, I refer to the rates of tax that apply respectively in the United Kingdom., New Zealand and Australia to men without dependants on the average range of income of £600 a year, or about £12 a week.
– The average range?
– The wharf labourers ‘ whom the honorable member represents get about twice as much as that. In the United Kingdom, the tax on £600 a year for a man without dependants is £131. In New Zealand, under the reduced tax scale which is to be introduced by the Holland Government, the levy will be £93. In Australia, it will be £56. Before we complain about our own sacrifices, let us consider the sacrifices that other people are making.
As the Prime Minister said earlier to-night, the budget was not necessarily designed solely for the purpose of increasing taxes, although that object is essential for the reasons that he outlined. The State governments have many important works to carry out. I do not think that any member of the Opposition would suggest that those works should be reduced in any way. The Government of New South Wales, for example, requires funds for electricity services, hospitals, land settlement of ex-servicemen, the restoration of its railways system and the purchase of locomotives and other rolling stock, road transport, tramways, water conservation and irrigation, and education, including technical education. I am not privileged to be able to state the amounts that it needs, but obviously its commitments are heavy. We know, for instance, that the trams of Sydney and Newcastle have been almost run to pieces. The items that I have mentioned are only a selection from, a larger list. Every State government is faced with similar obligations that cannot at this stage be forsaken or reduced. Many major public works had been commenced before the present state of emergency arose and State governments had placed orders for machinery abroad. A3 the Prime Minister said to-night, this Government has agreed to underwrite State loans to the amount that they may be under-subscribed in order to ensure that there shall be no wholesale dismissals of men. It is known that the requirements of the States for the current financial year amount to not less than £225,000,000. If the public support of the loans falls short by £100,000,000, there will not be a surplus of £114,500,000 but only a handful of millions left. As the Prime Minister has already pointed out, the alternative to budgeting for a sur plus, ‘ letting down the States, and the wholesale dismissal of employees engaged on these works throughout Australia would have been to inflate the currency by printing £100,000,000 worth of fresh money - because that is what it amounts to - and imposing it on an already overburdened monetary system.
– Talk sense.
– I have not heard one suggestion from the Leader of the Opposition or the honorable member for Melbourne about an alternative method of financing the States’ deficits.
– Would the Minister like to hear one now?
– The honorable member for Dalley (Mr. Rosevear) may offer a suggestion at another time, without interrupting my speech. I have been a Minister in this House for too long to be trapped by such a time-wasting device. I heard the name of the late J. B. Chifley mentioned during the debate to-night. It is a name for which supporters of the Government have great respect.
– They had no respect for the right honorable gentleman when he was alive..
– We had more respect for Mr. J. B. Chifley than the honorable member for East Sydney had for Mr. John Curtin. If his colleagues knew what he did to Mr. Curtin, I doubt whether they would forgive him. [Quorum formed.] On the 17th October, 1950, when speaking from the place at the table occupied at the moment by the honorable member for East Sydney, Mr. Chifley said -
I believe that when a country is in a prosperous condition it should pay its way and, if possible, provide an additional sum of money for capita] works and for reserves.
In other words, it should budget for a surplus. The right honorable gentleman continued -
I make no bones about the attitude of the Labour party in that matter. In my opinion that is a proper and businesslike method to adopt.
There could be no more prosperous condition than that which exists to-day.
The CHAIRMAN (Mr. Adermann).Order ! The Minister’s time has expired.
.- The Postmaster-General (Mr. Anthony) stated that the present inflationary conditions were due partly to factors outside the control of any government, and referred specifically to the high prices being received for our export goods. Yet the Minister for Commerce and Agriculture (Mr. McEwen) is at present in Great Britain trying to obtain from the British Government still higher prices for Australian exports. The Minister also said that the present taxation scales are very light compared with the scales that operate in other countries. They were much lighter when Mr. J. B. Chifley was Prime Minister of this country, but the then Opposition did not concede that they were light. Indeed, it specifically promised that it would make them lighter if and when it was returned to office. I had a request from the research secretary of the British Labour party to send to him the propaganda that was put out by this Government before the 1949 general election. That involved me in getting a great many newspaper cuttings and advertisements. One extremely interesting newspaper advertisement described the budget of £471,000,000 introduced by Labour in 1949 as “ astronomical “, and referred to it as a socialist plot and as evidence of socialist wastefulness and socialist expenditure. It stated “ Chifley gets out of every one of you by indirect taxation £61 a head “. It was claimed that if a Liberal and Country party government was returned indirect taxation would be reduced. The Minister stated that it is only a year ago since Mr. J. B. Chifley stated that during prosperous conditions a country should pay its way and provide additional sums of money for capital works and reserves. It is interesting to note that since this Government assumed office it has more than doubled the amount of indirect taxation .which the parties of which it is composed attacked in their advertisements prior to the general election in 1949. It is now £123 a year a head of population, compared with £61 a head in the last Chifley budget. “Whether unavoidable or not, this budget is a violation of every promise that was made by supporters of the Government when they were sitting in Opposition. If. an expenditure of £471,000,000 proceeded from a socialist plot from what is a budget expenditure of £1,041,000,000 proceeding? The Minister has not justified the complete violation of the Government’s promises.
Professor Copland has stated that this is a courageous budget. If there is any word that should not be applied to it, that word is “ courageous “. In budgeting I presume that the word “ courageous “ is applied to an open and honest taking of responsibility and a frank recognition by the Government that it is taxing the people. Expenditure has doubled in less than the two years since Labour was defeated, although income tax has increased by only 10 per cent. The conscious tax, the open tax, the tax for which the Government assumes full responsibility - income tax - is increased in two budgets by only 10 per cent., whilst indirect tax, the snide tax, the tax which hits indiscriminately and which needs no great courage to increase, is doubled in the present budget. For Professor Copland to call it a courageous budget must mean that the National University is in need of an increased - grant, and he is taking necessary steps to get it.
The second thing about the budget is the claim that it is opposed by the rich. The Prime Minister (Mr. Menzies) made that assertion to-night. Although when the budget was introduced the Sydney Morning Herald criticized it severely, that newspaper has since toned down its criticism steadily, simply because it could not get any section of commerce or industry to join in its criticism. Industry certainly will not join in criticism of a budget which is based upon indirect taxation, for the very good reason that industrialists know that the increases can be passed on to the community. If the Treasurer (Sir Arthur Fadden) had had the courage to introduce the excess profits tax, about which we had heard so much, the Sydney Morning Herald would have found that industry would have joined in the hue and cry. This is not a “soak the rich “ budget, but one that hits blindly and indiscriminately at the people. The indirect taxation that the Government is imposing will aggravate inflation. Last year honorable members opposite claimed that the budget for 1950-51 was a budget to arrest inflation. After all their defamation of the late Labour leader, they “ jumped “ their first budget from £593,000,000 to £s41,000,000. The Government is relying on two completely exploded hypotheses about arresting inflation. One has been uttered again by Professor Copland, although it has been completely refuted by a much greater economist, John Maynard Keynes, and the other has been enunciated by the Government. One fallacy is that inflation can be arrested by increasing interest rates. That is the new Copland dogma, which has already been carried into effect by this Government in relation to Commonwealth loans. The other fallacy is that labour can be diverted by the operation of indirect taxes. Keynes made an exacting analysis of the policy of raising interest rates, which was the settled policy from 1925 to 1929. He pointed out that all that an increase of interest rates did was to discourage investment in long established, sound basic industries that did not pay spectacular dividends because industries of that kind would not borrow money at high rates of interest. As interest rates were systematically increased, the speculator, the luxury trader and the man who could afford to pay high interest rates continued to borrow, whilst the sound business man ceased to do so. Par from arresting the inflationary spiral, the policy of increasing interest rates accentuated it by tending to leave the field open for the irresponsible speculator. I do not believe for one moment that people who want to borrow money now for investment in luxury industries will have any reason to fear increased interest rates.
– Has the honorable gentleman ever heard of capital issues control ?
– Having regard to the agitation in which members of the present Government parties indulged recently, the Government had better ascertain whether its capital issues control is constitutionally valid before it tells us how effective the control is going to be. It is like the Defence Preparations Act, probably only one section of which will survive challenge in the High Court.
– I suppose that that is what the honorable gentleman hopes will happen?
– I do not hope that at all, but I do not see why the Government should base its policy upon illusions. I shall deal now with the Government’s belief that the operation of indirect taxes will divert labour from luxury industries by causing people to cease buying luxury goods. The PostmasterGeneral made the remarkable statement that, because the New South Wales Government imposes a betting tax, the more revenue it derives from that tax the better pleased is it. If stupid reasoning of that kind is to be accepted, then the greater the amount spent on the purchase of luxury goods the more pleased will this Government be, because it has increased the sales tax imposed on them. That is a ridiculous argument. If it be true, as this Government contends, that an industry can be discouraged by increasing the rate al which sales tax is imposed on the goods that it produces, it must be equally true that the betting tax imposed by the New South Wales Government will discourage betting. If the betting tax does not do so, the whole thesis upon which this budget rests is nonsense.
The Government has held up before our eyes a magical surplus, and has stated that the effect of its attainment will be a reduction of prices. That would be true if the surplus were to be derived substantially from direct taxation - from deducting tax from incomes at the source. But the intention is to obtain the surplus by increasing sales tax, the effect of which will be to cause prices to rise. It is contended that, after the increases of sales tax have caused prices to rise, they will, in some magical way, lead to a reduction of prices. That seems to be rather Coplandian reasoning which does not have much to recommend it.
The members of the Australian Country party have had a great deal to say about the virtues of this budget, which was drafted by an Australian Country party Treasurer.
– A good Treasurer.
– I presume that he will not be a more disastrous Treasurer than was the last member of the Australian Country party who held that office. This budget will hit the person in the country more than it will hit other persons. Sales tax will snowball as goods go into the, country. The further a man lives from the centres in which goods are produced, the greater are the freight charges that he pays upon those goods. The amount of sales tax that is payable upon an article is calculated on the basis of city prices plus freight charges. Therefore, people in the country will pay more sales tax than will people in the cities.
– That indicates complete ignorance on the part of the honorable gentleman.
– As a result of this budget, the basic wage will rise, but apparently the Government is quite satisfied that, somehow or other, it will arrest inflation. I do not criticize the increase of the excise duty upon tobacco. I am not a smoker myself, and I do not care how much duty is paid upon tobacco, but I state as a fact that the increase of the excise duty will cause an increase of the basic wage, because tobacco is one of the items in the regimen on which the cost of living is calculated.
We have heard a lot about purchases of luxury motor cars. Many firms buy motor cars for commercial purposes, and everybody knows that if they have to pay more for them the increase will be reflected in increases of the prices of the goods that they sell. The Treasurer, having doubled some sales tax rates, estimates that he will receive double the present revenue. That destroys his argument that the effect of the increases will be to discourage people from buying articles upon which the tax has been increased. He has assumed that the same quantity of goods will be sold and that the revenue from the tax will be doubled. It is well known that the British Government did not divert labour from luxury industries to essential industries by means of a sales tax. That objective cannot be achieved in that way. The British Government did something that I do not advocate. It effected a diversion of labour by means of physical controls. It has been found by every government that has set out to divert people to essential industries, especially in war-time, that sales tax and indirect taxes of other kinds are not an effective means of doing what is required.
The Government has claimed that this budget will hit everybody equitably, but it has increased the sales tax payable on. toys. If a Treasurer were to try to devise a tax to hit a family man whohad children too young to be earning,, he could not do better than that, yet Government supporters talk vaguely about this budget hitting everybody in the community equitably. This is an inflationary budget. Labour cannot be redirected by the imposition of indirect taxes. Therefore, the Government’s expanding arms industry will* be competing with luxury industries, non-essential industries and essential industries. The increases of sales tax will not kill the luxury industries, which will continue to exist. The Treasurer apparently assumes that they will because he estimates that he will receive double the present revenue from them. As the arms industry develops, it will have to compete with private industry and will be forced to pay high wages in order to attract labour from private industry. The arms industry will be competing for labour the whole time, and the inflationary trend will continue.
I agree that the 10 per cent, increase of income tax will, in terms of money, be quite insignificant for people on lower incomes. Nor will it be very significant for people on higher incomes. If the Government is so eager to’ attack luxury industries, why has it not hit at the high returns that are being derived from such industries? Why has it not graded the increase of income tax from 10 per cent! on lower incomes up to 20 or 30 per cent, on higher incomes? Instead, it has done something without precedent by imposing a flat rate increase throughout the whole ranges of incomes. Having done that, it has shed crocodile tears and has stated that the rich are weeping because of the budget. There could be no lower impost on the higher incomes than an increase of the tax payable on them of the same percentage as that by which the tax payable on lower incomes is increased. The Government’s theory that a surplus, if put away, drains off spending power, is unsound if the surplus is derived from indirect taxes that cause an increase of prices, hut it is doubly unsound if the surplus is to be used to underwrite the failure of Commonwealth loans.
Two matters show that the supporters of this Government have no confidence in its financial policy. The first matter was the wool referendum. The Australian Country party claims particularly to represent rural interests. Yet the country people voted against the proposal that the Government should hold their money for them. They voted against it because they were afraid.
– They did so on my advice.
– They did so because they were afraid to leave their £45,000,000 in the hands of the Government to depreciate further, for the same reason as holders of bonds are trying to unload them. If a person bought £100 worth of bonds in 1945, when the basic wage was £4 17s. a week, he paid twenty weeks’ basic wage for them. If he gets back that £100 to-day he receives only ten weeks’ basic wage. Because of the failure of the Government to arrest the falling value of the £1, nobody wants to invest in bonds. The wool-grower does not wish to trust his money to the Government under any stabilization scheme. Without any fine speeches, the investing class and the woolgrowers of this country have demonstrated their lack of confidence in the Government. Because of the impotence of this Government to tackle inflation, and because of the effect of indirect taxes on the prices of commodities, there will be even less inclination to invest in bonds. Therefore, the expected surplus of £114,500,000 will be called upon repeatedly to take up the slack where private investors decline to invest in bonds. I suggest that the- Government would do well to make sure that there will be a surplus at the end of the financial year before we hear much more about the effect that a surplus will have in arresting the upward trend of living costs.
The Government should seek power to control prices. Honorable members opposite, when opposing the referendum on prices control, advocated adherence to a classic principle which I admit, is sound in ordinary circumstances. In normal times I should agree entirely with the arguments that they used. They said, “ Let prices go ; let them rise. That will stimulate the producers to produce more. There will be a surplus, and prices will then go down “. Such a principle works very well when we can be sure of receiving a great volume of goods from Britain, Japan and Germany, as we were before 1939, but that situation is not likely to be reproduced by a war-damaged Europe or by a world that is rearming. In other words, there is a complete warping and perverting of economy because of international tension. Abnormal economies exist in the world to-day, and sooner or later this Government will be forced to recognize that fact. It has been forced to recognize it as far as its Defence Preparations Act is concerned. What would be the point in a government enacting prices control legislation which it thought would not be upheld in the High Court unless it was prepared to take the necessary action to validate it? The first thing that the Government should do is to seek to validate such legislation constitutionally by way of a referendum.
I suggest that the Government should give pre-eminence to graduated income tax; that it should concentrate on that part of the budget that is based upon direct honest, open taxation, graded according to ability to pay, rather than hit blindly and indiscriminately. In addition, I suggest that the Government should be more realistic concerning its defence programme. Last year the Government appropriated £45,000,000 the whole of which it could not expend. With so many competing industries over which the Government has no control and from which even the imposition of the proposed new sales tax will not divert labour, it will be found that the proposed appropriation for defence purposes also cannot be expended. All that this budget will do is to act as a brake on the attainment of some sort of stability in the economy. It lacks courage. It seeks to utilize hidden methods of taxation. It will increase prices. It is a complete violation of everything for which the Government parties claimed to stand before the last general election. Although I do not agree with the Sydney Morning Herald’s analysis of the budget, and although I do not agree that it will discourage the industrial friends of that newspaper, I do agree with the statement that the budget should be withdrawn.
national Service - Public Service - Commonwealth Motor Vehicles.
Motion (by Mr. Eric J. Harrison) proposed -
That the House do now adjourn.
– I desire to bring to the notice of the Government particulars concerning a resident of St. Leonards, South Australia, who, in September, 1949, became a victim of poliomyelitis. The youth in question was an inmate of the Northfield hospital for ten months with that disease, was discharged from hospital and for eight months was treated at home. During those eight months he was in a frame and wore leg-irons. When that period had expired he continued to receive treatment from a doctor, who told him that he would not be able to return to his previous work as a truckdriver, nor would he be allowed even to ride a bicycle. It was at that time that, in conformity with the regulations that relate to national service, he completed his registration form, giving details of his medical history and his then medical condition. He was medically examined by two doctors and for some reason was passedA1, despite the fact that he walked with a decided limp because one leg was thinner and shorter than the other.
– Who passed him ? Army doctors ?
– I do not know who passed him, but he was passed as medically fit. He then went to see the civilian doctor by whom he was being treated and was given by him a certificate which he took to the Army authorities. The authorities took the certificate and informed him that the exercise in camp would do him good. The lad eventually went into camp at Woodside. Within seven days of his having entered the camp he had lost 7 lb. in weight. His father then contacted me, and the story seemed so fantastic that I could not believe it. I contacted the Army authorities at the Woodside camp, who said that there might be something in the story, but that it was not their fault at any rate. They said that the Department of Labour and National Service was to blame for having sent the youth into camp. I contacted the Department of Labour and National Service, and I must say in fairness to both thai department and the Department of the Army that as soon as I had brought the case to their notice and their investigations disclosed that what I had said was true, the youth was immediately put into hospital, and I was informed that I need not worry very much about the matter, because he would soon be medically boarded and discharged. After about two weeks in hospital, in which attempts were made to restore the youth to something near the health he had enjoyed when he went into camp, he was discharged. When he entered Woodside camp his weight was 11 stone. It was only 10 stone 3 lb. when he was discharged. During his period of training at the Woodside camp there was an outbreak of poliomyelitis in it. I am not suggesting that his presence in the camp caused the outbreak, but I do contend that if doctors pass as medically A1 and put into military camps youths whose physical condition is comparable with that of this youth, the outbreak of poliomyelitis at Woodside was not to be wondered at. That youth’s health suffered through the inefficiency of a doctor who acted, I should imagine, as a servant of the Government, and. therefore, I ask the Government to hold a public inquiry into this matter. The full facts should be known widely, because when youths are called up for military training and are placed in camps both they and their parents should have every confidence that they will receive a medical examination that will be truly a medical examination and not a slip-shod examination. Parents should also be assured that their sons will not be the subject of remarks such as were made to this lad to the effect that the exercise in camp would do him good. Only time will reveal the degree to which his health has suffered as a result of the treatment he received. Prior to being put into Woodside camp be had obtained a light job, which was the only kind of work that he was capable of carrying out. He is now unfit to return to that work. I consider that the Government must accept responsibility for that and be prepared to pay appropriate compensation. All the expense that his parents bore in order to restore him to the best state of health that they could manage has gone by the board, and they have to start afresh. So again 1 ask the. Government to accept the responsibility for the mistake made by a doctor who. was acting for it. I also ask that a public inquiry be held into bow this youth came to be passed as medically fit and that the Government shall consider what compensation it is prepared to pay to him and his parents for this’ grave mistake. I ask further that the doctor’s name be given to me, and that all trainees who have been examined by that doctor be re-examined by a capable medical man. I urge the Government to ensure that efficiency shall be the first consideration in relation to the appointment . of doctors to carry out medical examinations under the national service scheme. We were told that efficiency was to be the first consideration in connexion with dismissals from the Public Service. I do not know whether it will be possible to compensate the youth, but at least the Government should hold a full inquiry and do everything possible to right the wrong that has been done. The name of the youth, ‘ according to his certificate of discharge-
-Order! There is uo need to give names now. That can be done privately.
– The certificate of discharge states that the youth was discharged on the ground that he was unsuitable for further military service because of a physical disability sustained prior to enlistment.
– I had not heard previously any of the facts to which the honorable member has made reference, and I assure him that if he will give to me, privately, the name of the trainee to whom he has referred I shall see that a full examination of the case shall be made.
I do not feel disposed to make any comment on the various references that the honorable gentleman has made until I have the full facts before me. I should, however, like to say in general terms, as this incident may be regarded by the public as well as by the Parliament as being typical of our experience under the national service scheme, first, that the doctors engaged by the Government for the purposes of medical examination in connexion with the scheme are not full-time employees of the Government. They are medical men who, generally speaking, have at very great inconvenience to themselves and as a matter of public duty, assisted the Government and my department to carry out this work. They have done so thorough a job - for which I express the thanks of the Government - that this is, to the bes of my knowledge, the first complaint that has reached me of any mistake having been made in the course of such a medical examination.
– Are not the doctors paid for their services?
– Tes, they are paid an appropriate fee which the Treasury has prescribed. It may be that a mistake has been made in this instance I am not challenging the fact? as the honorable gentleman has presented them, but I do claim thai proper regard is had for trainees or prospective trainees who do not measure up to medical standards. Of the first 10,000 young men who were examined for national service about 20 per cent, have been rejected on medical grounds. The honorable member for Kingston has stressed the lad’s unfortunate loss of weight and decline in health during the course of his training. Again, I am not challenging the facts; but, in order that the Parliament may have a more balanced recognition of what has occurred under the national service scheme, I must say that the overwhelming majority of young Australians who have gone into camp under the scheme not only have gained in weight but also have certainly improved greatly in health and general physical condition. I am quite certain that any honorable member who has taken the trouble to visit any training camp in his electorate will confirm that statement. I make these comments only in order that we may have a balanced view of the scheme and of the way in which it is operating. I undertake to have examined the particular case raised by the honorable member for Kingston and if, as a result of any negligence by any servant, even a temporary servant, of the Commonwealth there is a claim upon the Commonwealth for proper compensation, that aspect also will be fully examined.
– I have received representations from several fathers of youths who have gone into the Brighton camp in my electorate regarding the cost of transport between the camp and their homes. They seem to me to be under a misapprehension regarding the payment of travelling expenses for trainees when they return to their homes at the end of each month. I was told that the Army authorities had promised to pay all travelling expenses in excess of 5s. Recently, trainees received their first leave from Brighton camp. Those who returned to their homes in the north had to pay £2 for travelling expenses and those who travelled to the north-west had to pay £3. The youths were keenly disappointed because they believed that an official promise had been broken. I now ask the Minister for the Army (Mr. Francis) to say whether the facts are in accordance with the representations made to me, and if they are, whether he will do something to meet the expenses incurred by trainees who have to travel long distances to their homes.
– I desire to bring to the notice of the House some features of the Government’s programme for the dismissal of 10,000 Commonwealth employees, and in particular to mention the case of a young woman who was employed in the Public Service as a stenographer. We know that stenographers are hard to get for the Public Service and for private employment. Recently, this young woman was dismissed. She was interested in her job and wished to continue in it. I communicated with the Public Service Inspector in the State in which she was employed, and asked what could be done. He told me that she was to be dismissed from her position, but that it was possible to engage her in one of two other Commonwealth departments which he named. Surely that is a strange way in which to implement the decision of the Government to reduce the number of Commonwealth employees by 10,000 and thus save money. What purpose is served by discharging employees from one Commonwealth department and promptly re-engaging them in another on work which is less congenial, perhaps, and at a lower rate of pay? Already numerous cases of that kind have been brought to the notice of my colleagues. They serve to demonstrate the weakness of the case made out by the Government in support of the dismissals. The whole retrenchment plan was obviously a haphazard one, and is inflicting great hardship upon the persons concerned. I should like to know why some stenographers are being dismissed from the Service while the newspapers are still carrying advertisements inviting applications from persons willing to accept employment in the Service as stenographers. If the young woman whom I have mentioned is to be on the Commonwealth- payroll, I can see no reason why she should not be retained in her present position, seeing that her departmental head wishes to keep her.
– I wish to reply to the honorable member for Wilmot (Mr. Duthie), who said that national service trainees did not, apparently, know the basis upon which they were entitled to obtain week-end leave from camp. No trainee can be in doubt regarding conditions of leave. Every trainee has received a copy of. a booklet entitled, Welcome to Your Army. At pages 20 and 21 of the booklet the conditions of leave are clearly .set out. I quote them as follows : -
The grant of emergency leave will also give you an entitlement to a free return travel warrant to your home.
If by injury or sickness directly attributable to your National Service training you are prevented from resuming your normal occupation on discharge from National Service or immediately following the termination of the fulltime training period, you will become eligible for benefits under the Commonwealth Employee’s Compensation Act.
I direct the attention of honorable members to the words “ the nearest large town or provincial depot “. The men referred to by the honorable member are being trained in Brighton camp, consequently they are entitled under the conditions that I have read to go to Hobart for their leave.
– That is not the proposal, and never was. I have visited all the national service camps in Australia. I have met many thousands of trainees, and they have spoken to me about their camp life - about how much they enjoy it, how much they have improved in physical fitness and how much they appreciate the opportunity to train for the defence of their country.
Honorable members interjecting,
– Order ! If there are any further interjections I will leave the chair.
– Honorable members opposite get up and ask for information, but they are apparently not prepared to hear my reply. I have told national service trainees about the conditions of leave, and I have also explained the position to honorable members on this side of the House. The whole position is at present being examined, and I hope to be able to give to the House at an early date some information about the procedure that may be adopted to improve the concessions granted to trainees. The Government has honoured in the spirit and in the letter the undertaking given to trainees when they entered camp.
– I wish to finish the story that I started to tell to the House last night. In his letter to me the Minister for Supply (Mr. Beale) stated his reason for not allowing me to have the opportunity of inspecting the job sheets of the Commonwealth transport pool in Adelaide in order tofind out who was using Common wealth cars in South Australia. It was as follows : -
I am sorry I cannot agree to make the departmental records available for your inspection. Such a practice, so far as I can ascertain, has not been followed by any government, and I feel it would be undesirable to approve it now.
I wrote to the Minister a letter in which I stated -
I note with amusement that you justified your action with the contention that no other government has ever made such records avail able to a member of the Federal Parliament.
This was the first time that I knew that you were particularly concerned with upholding the decisions of previous governments, and in any event can you tell me whether you have any records of any instances where an elected representative of the people has sought this information ?
Last night, the Minister in an attempt to belittle the statement that I had made on this matter, said that I had hoodwinked one of his officers in Adelaide by representing that I was yon, Mr. Speaker. He claimed that I had said, “ This is Cameron speaking”. He told a peculiar story about the incident. I do not suggest that the Minister made it up. One of his officers in Adelaide has been “ pulling his leg”. He should not take himself so seriously as he does. He should bargain for this sort of thing and discount a lot of what is told to him by other people who are not so prone to take him as seriously as he takes himself.
A long time ago you, Mr. Speaker, and T experienced this conflict of name and to the best of my recollection you told me that you had commenced signing yourself “ Archie Cameron “ in order to prevent misunderstanding. Not only have I signed myself “ Clyde Cameron “, but also when I make a telephone call or answer the telephone I say, “ It is Clyde Cameron speaking “. [ have a good reason for doing that. Shortly after we had had that discussion I had occasion to ring a friend of yours and mine.
Honorable members interjecting,
– Order ! I must ask honorable gentlemen on the Government side of the House ‘to cease inter jecting. The honorable member for Hindmarsh (Mr. Clyde Cameron) is entitled to make this statement and I propose to hear it.
– You said, sir, that we did not have to listen.
– If the honorable member for Henty (Mr. Gullett) does not wish to listen he may leave the , chamber.
– What I am about to relate happened a considerable time ago. I answered the telephone and the person who was calling said, “Is that you, Archie?”
Believing it to be a joke and that the person knew perfectly well that he was speaking to me, I replied, “ Yes “. He said, “ I see that you threw your namesake out last week “. Then I hung up, hoping that he would think that we had been disconnected. I met that person in the following week. He shook hands with me and said, “ I see that Archie had been dealing it out to you pretty well lately”. I replied, “Yes”. He said, “ He has more cheek than Jessie “. Consequently, I thought it was about time that I took care when making or receiving a telephone call always to indicate that it was Clyde Cameron and not merely “ Cameron “ who was speaking. So the Minister can take it that the officer “ pulled his leg “ when he told him he was rung up by some one who stated that he was “ Cameron “ and that he was disappointed when he found that it was not you, Mr. Speaker. I can say that the man thoroughly enjoyed his dinner. We had a good talk and did not discuss the Minister, nor did I attempt to discuss him. I am trying to be helpful in this matter. I merely asked the Minister to try to assist me to assist his Government to prevent the unnecessary use of Commonwealth cars. Instances have been given to me of his department having been rung up by officers of other departments and asked for car transport to Murray Bridge the next morning. The officer who received the requests asked one inquirer, “ Could you possibly make the journey tomorrow afternoon when we have a car going to Murray Bridge for another department? “ The reply was, “ No. We want it in the . morning and that is the end of the matter “. Because there is absolutely no cooperation by the heads of the various departments with the Minister’s department in Adelaide for the prevention of unnecessary travelling, there is probably double the car-travelling that is really necessary. I know of two cars having been sent to one town on the one day when one car could easily have done the work. This involved over 100 miles of unnecessary travelling forward and back for the second car, the wages of the driver and a lot of other avoidable expenditure.
I ask the Minister to allow me to have the opportunity to assist him to ascertain how much of the car travelling by officers of the various departments is unnecessary. [ know that it has become a habit in some departments. I do not say that it has occurred only during the reign of this Government. It is a practice that has continued for far too long and that ought to be stopped. The Minister has not yet replied finally to my request for an opportunity to assist him in this matter. A definite wastage of Commonwealth cars and money is taking place. At a time when the Government is talking of saving public expenditure and when the Minister for the Interior (Mr. Kent Hughes) has gone out of his way to assist to balance the budget by refusing to allow his colleagues in the Parliament to be supplied with a teledex, which costs 16s. 6d., it ill becomes the Minister for Supply to sit opposite with a supercilious grin on his face.
Last night the Minister for the Interior practically threatened that if honorable members raised this matter again he would disclose a lot of information concerning them. He made a sinister threat to smear honorable members on both sides of the House. I do not propose to drag into the debate the names of individuals, including Ministers - as I could easily do - who have grossly abused their parliamentary privileges. I could cite some classic examples of such abuses. If such behaviour is to be the order of the day let us proceed with it. If the Minister is bent on threatening honorable members with some sinister exposure merely because they have directed attention to the abuse of the Government’s finances and car services the quicker honorable members pull the gloves off the better.
– Order ! The honorable member’s time has expired.
– I am deeply obliged to the honorable member for Hindmarsh (Mr. Clyde Cameron) for his generous offer of assistance. It reminds me of the Latin phrase, which I know will not be generally understood in this chamber, Timeo Danaos et dona ferentes, which means “ I fear the Greeks even when they offer presents”. When the honorable member says, “I want to help the Minister to help somebody else to help himself “, I am entitled to be a little suspicious. The extraordinary thing that emerges from the honorable member’s speech is that, in order to excuse himself in this matter, he is apparently prepared to place an officer of my department in a very peculiar position. He has told the House that he made it clear to the officer concerned thai he was not the Speaker of the House of Representatives, but Mr. Clyde Cameron, a private member of the House. He invited the officer to have lunch with him, and undoubtedly attempted to “ pump “ him in order to obtain information about the Department of Supply. Obviously no government, irrespective of its political complexion, would regard that as a desirable state of affairs.
– The honorable member did not say that he tried to “ pump “ the officer.
– I said last night that he had done so, and I repeated the charge again to-night, but the honorable member did not deny it. Obviously, he has been obtaining information from some source. Why did he invite the officer, who was a stranger to him, to lunch: Why did he pay for the officer’s lunch? This was a most disgraceful episode and, in the circumstances; it is little wonder that I am not bothering to reply to his letter. The honorable member is determined not only to discredit himself in this matter, but also, if I may use a homely phrase, to “ scab “ on his mates, because the whole tenor of his criticism of the Government relates to the manner in which the Commonwealth transport pool is being conducted in Adelaide and elsewhere. What we are doing, apart from effecting certain economies, is precisely what was done when the previous Labour Government was in office. For the edification of the honorable member, I explain that, although there are between 80 and 100 motor vehicles attached to the pool in Adelaide, only 22 of them belong to the taxi pool for the transport of Commonwealth officers and other persons in that city.
– I counted them, and my information was correct.
– Probably the honorable member cannot count correctly. I am giving the facts. There are many vehicles attached to the pool in Adelaide, but, ag I have said, only 22 of them belong to the taxi pool. The remainder of the vehicles are hired out to other government departments. It is true that, under the Labour Government’s administration, irregularities and extravagances grew-
– That is not true.
– It is true. The transport committee reported extravagances in the transport pool amounting to approximately £200,000. Since the present Government has been in office, it has been engaged upon the task of effecting economies and eliminating extravagances. I hold the view that the system of hiring out vehicles which are under the nominal control of the Department of Supply should be reviewed. “When such vehicles are made available to other departments on the issue of an order or a chit, we have no record of the uses to which they are put. The system was established by the Chifley Government, and, in my opinion, it is not a good one. We are in the process of changing it, and I hope that, before long, it will be replaced by a better system, under which, perhaps, officers of various departments will be encouraged to buy their own motor cars and to operate them on a mileage allowance granted by the Commonwealth.
– Yellow Express.
– There are other ways in which we are effecting economies. The honorable member’s hopelessly unfounded criticism, if I may describe it so temperately, is not shared by his colleagues, and will not be welcomed by them because they are coming to me, I might almost say in droves, and asking me, as Minister for Supply, to extend to them as private members the privilege of the use of Commonwealth motor cars.
– As members of’ the Parliament.
– Apparently the honorable member believes that we can do anything we care to do for members of the Parliament. He is yearning to settle his posterior on the back seat of a great Buick. The cat is out of the bag !
If he is able to enjoy that privilege, lie will be perfectly satisfied. I venture to say that it is likely to be a long while before the enjoyment of. such a privilege will become general practice for him. It is true that we have extended the privilege of the use of Commonwealth motor cars to certain members of the Parliament who suffer from physical disabilities. I have been happy to extend that privilege in more than one instance.
– That is not a privilege. It is a right.
– It happens to be a privilege which we extended to them. Other members of the Parliament are asking for the allotment of cars to enable them to drive to their homes. Representations are being made on a high level by the Labour party, not through the low level of the honorable member for Hindmarsh, to extend the privilege to certain older members of the party and former Ministers. All these applications are being considered. I said last night, and I repeat to-night, that the work of a member of the Parliament is very arduous. Consequently, I am prepared to do everything I can do to assist honorable gentlemen. The sentiments that have been voiced by the honorable member for Hindmarsh are not shared by most of his colleagues, some of whom have been pleased to tell me so. We are prepared to do what we can do for honorable members generally, but I need not say that the cause of honorable members generally - Opposition members in common with those who support the Government - will not be advanced by the sort of sniping in which the honorable member for Hindmarsh has indulged. He is inviting us to wash some dirty linen here. If he wants it in that way, some of his colleagues will get the biggest shock of their lives. He apparently forgets that I happen to have access to the records of what happened under the administration of the Labour Government. For the sake of the dignity of the Parliament, and for the benefit of honorable members, I trust that this sort of silly, unfounded attack will cease. If the honorable member has any specific case and will place it before me, I undertake to have it examined ; but I cannot refrain from reminding him that if he waits for a thousand years, he will not have access to any of the records of my department.
Mr. Ward interjecting,
– Order ! The honorable member for East Sydney must remain silent.
– Mr. Speaker, it was I who made the unseemly interjection.
– I also heard the remark made by the honorable member for Lalor (Mr. Pollard). Before I put thequestion, “ That the House do now adjourn “, I point out that, to-night and last night, I allowed a certain latitude that was quite irregularin the debate on the motion for the adjournment of the House. At present, the Committee of Supply is engaged in the discussion of the budget and Estimates, and henceforth until Supply has been granted to the Government, I shall not permit, on the motion for the adjournment of the House, reference to any matter that can be covered in the debate in the Committee of Supply, either onthe budget or on the Estimates. I shall firmly adhere to that decision. If any honorable member wishes to speak on any other matter, he will have to see me before the motion for the adjournment is proposed, and let me know what matter he wishes to discuss. I shall then tell him whether or not it will be in order for him to do so. .
Question resolved in the affirmative.
The following papers were presented : -
Apple andPear Organization Act - Regulations - StatutoryRules 1951, No. 92.
Canned Fruits Export Control Act - Regulations - StatutoryRules 1951, No. 94.
CoalExcise Act - Regulations - Statutory Rules 1951, No. 104.
Commonwealth Bank Act- Regulations - Statutory Rules 1951, No. 88.
Conciliation and Arbitration Act - RegulationsStatutoryRules 1951, No. 100.
Customs Act - Regulations - Statutory Rules 1951, Nos. 99, 106.
Dairy Produce Export Control Act - Regulations - Statutory Rules 1951. Nos. 97, 102.
Defence (Transitional Provisions) Act - Regulations - Statutory Rules 1951, No.96.
Distillation Act - Regulations - Statutory Rules 1951, No. 105.
Dried Fruits Export Control Act - Regulations - Statutory Rules 1951, No. 103.
Meat Export Control Act - Regulations - Statutory Rules 1951, No. 101.
Naval Defence Act - Regulations - Statutory Rules 1951, No. 93.
Northern Territory (Administration) ActRegulations - Statutory Rules 1951, No. 98.
Pharmaceutical Benefits Act - Regulations - Statutory Rules 195.1, No. 89.
Post and Telegraph Act - Regulations - Statutory Rules 1951, No. 90.
Public Service (Arbitration) Act - Determinations - 1951 -
No. 77 - Transport Workers’ Union of Australia.
No. 78 - Commonwealth Public Service
No. 79- Federated Clerks’ Union of Australia.
No.80 - Musicians’ Union of Australia.
No.81 - Australian Workers’ Union.
No. 82 - Federated Ironworkers’ Association of Australia.
No. 83 - Customs Officers’ Association of Australia.
No.84 - Professional Officers’ Association, Commonwealth Public Service.
Wine. Overseas Marketing Act - Recitations -Statutory Rules 1951, Nos. 91, 95.
Wool (Contributory Charge) Act (No. 2) - Regulations - Statutory Rules 1951, No. 108.
House adjourned at 11.10 p.m.
Cite as: Australia, House of Representatives, Debates, 3 October 1951, viewed 22 October 2017, <http://historichansard.net/hofreps/1951/19511003_reps_20_214/>.