House of Representatives
24 October 1951

20th Parliament · 1st Session

Mr. Speaker (Hon. Archie Cameron) took the chair at 2.30 p.m., and read prayers.

page 1072




– Yesterday, the honorable member for’ Darling Downs asked me a question about the exact duties and responsibilities of parliamentary standing’ committees, and joint statutory committees, and I undertook to provide a’ reply for the honorable gentleman. I how inform him that this House has appointed seven committees. Two of them are ‘established by statute, and five are appointed by the authority of the House itself. I shall deal briefly with the method of appointment, the working machinery and the scope of authority with which each is invested.

The Public Works Committee is established by statute. There are five acts in operation dealing with .it; The Senate appoints three members to serve with six from this House on that committee. It is thus a joint standing statutory committee. It acts only on resolutions of the two Houses, and reports on each resolution. The scope of its inquiries embraces the Commonwealth arid its territories.

The Parliamentary Proceedings Broadcasting Act, No. 20 of 10*6, established the Parliamentary Proceeding Broadcasting Committee, and ite con stitution and powers are set out in that act. It is also a joint standing statutory committee which consists of three senators and six members of this House. It reports to the Parliament only on the principles upon which the committee decides to conduct the broadcasting of parliamentary proceedings. It has complete power over the broadcasting and re-broadcasting of parliamentary proceedings by every wireless station in Australian, territory.

The Committee of Privileges deals only with matters submitted to it by a resolution of this House under. Standing Order 24. There are seven members. It has no relations with the Senate. It controls its own procedure, but may ask, in certain circumstances, for special action by this House. It supplies to the House reports on matters which ore submitted to it, and the House then decides’ what action to take. The scope of our jurisdiction on privilege is thus defined in May’s Parliamentary Practice, 15tb Edition, at page 89 -

The penal jurisdiction of the Houses ls not confined to their own members nor to offences committed in their immediate presence, but extends to all contempts of the Houses, whether committed by members or by persons who are not members,- irrespective of whether the offence is committed within the House or beyond ite walls.

The House Committee is a joint standing committee of seven senators and seven members of this House, as provided by Standing Order 25. It determines the general rules on which the services attached to the House, such as the diningrooms, shall function. The President and Mr. Speaker are its executive members, and they alone have any control of the staff and all control of the rooms in this building. So far as I can learn, it has submitted to the Parliament two reports, one in 1905, and the other in 1906. It has no functions outside Parliament House; It arrives at decisions Which take effect as and when the committee determines. After I had prepared this statement, I received a report on the matter from the secretary of the Joint House Department. It is brief, and I shall read it. The report states -

The Joint House Committee has functioned since its first meeting on 20th June, 1901, without being required to submit reports on its work: to either House of the Parliament. Neither House has laid down any specific duty upon the committee, and any duties and functions performed by it have developed, by usage.

The present practice is for the committee to meet at intervals, mainly during sessions, and to make recommendations regarding matters connected with the provision of services and amenities to members of Parliament and to the stalls employed at Parliament House. The actual responsibility for the provision of these services and amenities is vested in the Joint House Department which is divided into the following branches, viz.: - Refreshment rooms, engineering services, housekeeper and cleaning staff, parliamentary gardens, and maintenance staffs.

The committee has no executive power over the branches of the Joint House Department and most of its decisions are in the form of recommendations to the appropriate authorities.

Under the Public Service Act, the Library is a department of the Government over which the presiding officers of the Parliament exercise both the powers of a Minister and the powers of the Public Service Board. They are continuously advised by the Joint Library Committee, and as the Library has no act of Parliament to prescribe its functions, the Library Committee over which the Speaker presides has been the main instrument in developing the policy and character of the Library which is now national in character. The committee has six members appointed by each House, vide Standing Order 25, in addition to the President and the Speaker, whose appointment is by statute as well as by Standing Order 25. The Library to-day has ten main functions, several of which extend overseas to Europe and America. It is a hybrid organization, part of its vote - £37.000 - being under Parliament and part - £100,000 - under the Prime Minister’s Department, as shown by divisions 4 and 13 of the Estimates. The Joint Library Committee has made no report to Parliament since 1907.

The Printing Committee consists of seven members from each House. Our members are approved under Standing Order 26. Its duty is to determine which reports, documents and papers shall bo published. It reports to Parliament. It has no other functions.

The Standing Orders Committee consists of nine members of this House, as ordered under Standing Order 23”. It does not co-operate with the Senate Committee on Standing Orders. Any member may request a meeting of the committee by stating a proposal for its consideration in the House. It always reports its recommendations, which are subject to’ debate, amendment, and division. It has no functions outside the House. The Australian Broadcasting Act provides for a statutory committee. This has not been appointed.

The decisions or recommendations of every committee are subject to the superior will of the House.

Whether each committee should furnish at least an annual report on its activities is a matter for the House to determine.

An opportunity to debate these matters is always given when the departmental Estimates are before the Committee of Supply.

page 1073




– Is the Minister for Labour and National Service aware that the manpower available for locomotive working in the major States of Australia has now reached proportions that should be regarded as dangerous if the strain of any war effort is likely to be undertaken? Is the Minister also aware that the State transport officers who were sent to the United Kingdom in order to enlist recruits for locomotive working in Australia have failed in their mission and are now reported to be turning their attention to Holland and Germany? In the light of the serious position that exists, will the Minister agree to convene a conference of either the senior conciliation commissioner or both of the conciliation commissioners in charge of the federal railways award with representatives of the Railways Commissioners of the States and the trade union concerned with the same award under the chairmanship of an officer of the Department of Labour and National Service with a view to exploring all avenues by which this dangerous national weakness may be corrected ?

Minister for Immigration · HIGGINS, VICTORIA · LP

– I am aware that there is an acute shortage of labour in the railways systems of Australia. It is true, as the honorable member has indicated, that most, if not all, State governments are trying to recruit additional labour for their railway systems in other countries. The estimated shortage for the whole of Australia varies between 15,000 and 20,000 men, and several thousand workers are being sought abroad. I shall give consideration to the honorable member’s suggestion for a conference and see whether some useful action along these lines can be taken.

page 1074



Minister for Shipping and Transport · BOOTHBY, SOUTH AUSTRALIA · LP

– Will the VicePresident to the Executive Council, who is the Minister in charge of the Royal visit, give early consideration to making provision, in the programme arranged for the visit, for a tree-planting ceremony by Their Royal Highnesses? If so, will he seek the co-operation of all interested bodies in order to arrange concurrent tree-planting ceremonies throughout the Commonwealth in which the young people particularly will participate, in order to encourage the planting and preservation of trees suitable to particular areas?


– The itinerary for the Royal tour has been practically completed, but there is a meeting on Thursday of the deputy directors of the tour in the various States to hear the result of the final decisions relative to the tour and to make suggestions in respect of proposed alterations. I know that the honorable member for Boothby is very interested in this aspect of the natural development of our own tree-life in Australia, and I shall give consideration to the point that he has raised, and also discuss it with the director-general to see whether action can be taken to have it considered when the deputy directors meet.

page 1074




– I direct to the Vice-President of the Executive Council a question relative to the announcement made last night by the Prime Minister that the Commonwealth will, after all, subsidize the price of commercial butter up to 3s. 6d. per lb. from the 1st July last to the date on which the New South Wales and Queensland governments increased the price in their respective States. Does this announce ment represent a change of mind on the part of the Government, and, if not, why was the decision kept secret for bo long? Why did the Government so persistently inform the representatives of the dairy-farmers that it would not, in any circumstances, pay this amount of additional subsidy? Was the decision kept ‘ secret in order to force the New South Wales and Queensland governments to increase the price, irrespective of injury and loss to both the producers and consumers in the meantime?


– That is a matter that comes more within the province of the Postmaster-General, who is the Minister representing in this chamber the Minister who is acting for the Minister for Commerce and Agriculture, and I suggest that he answer it.

Postmaster-General · RICHMOND, NEW SOUTH WALES · CP

– There has been no secrecy about the Government’s acts or intentions with respect to the price to be paid to the dairy-farmer for butter. The Government has made it clear all along that it expected the States to sanction an increased price to the consumer, and after the governments of New South Wales and Queensland, which, for the previous three months, had resisted such a price increase for the farmer, had made up their minds that they had to accede to that request, the Australian Government made an announcement within four or five days that it would not see the dairy-farmers lose as a result of the action of the two State governments that I have mentioned. Consequently, the Government announced last night, through the Prime Minister, that it would make good any loss which would be sustained by the dairy-farmers. That announcement was made over the national broadcasting system. There could be no less secret manner in which it could have been made.


– Supplementary to the question asked by the honorable member for Eden-Monaro, I ask the Minister representing the Minister acting for the Minister for Commerce and Agriculture to inform me whether it is a fact that this Government has now decided to subsidize dairy-farmers in New South Wales and Queensland for losses suffered by them because the price of butter was fixed in those States for a period at less than 3s. 2ii. per lb. ? If I have stated a fact, will the Minister explain why the Commonweal th did not pay the subsidy from the beginning of the trouble to all dairyfarmers throughout Australia in accordance with its pre-election promises and its statutory agreements with State governments, instead of throwing the whole burden of the extra 6£d. per lb. on to people in the lower income groups, and age and invalid pensioners?


– The losses which would have been sustained had this Government not acted as it has done would have been borne, not by the dairy-farmers of New South Wales and Queensland alone, but by all dairy-farmers throughout Australia. The operations of the equalization system would have meant that the butter which was sold at a loss in New South Wales and Queensland would have been pooled with the butter which was sold at the proper price in the other States. Consequently, this Government has acted in the interests not of the dairy-farmers of New South Wales and Queensland particularly, but of all dairy-farmers throughout Australia, and, in so doing, has lived up to the last dot of its pre-election promises.

page 1075




– Will the Vice-President of the Executive Council have a survey made to ascertain what food and other essential items that are in short supply for local requirements are exported from Australia ? Will he take action to restrict the export of all such food, and essential commodities that are found to be in such short supply?


– The honorable member’s question obviously involves a matter of government policy. The Government is continuing its survey of the food resources of this country, and will follow the policy determined upon with regard to matters that might affect food shortages.

page 1075




– Is the PostmasterGeneral aware that small automatic exchanges have been evolved to meet requirements and to overcome the problems of providing adequate telephone communication in rural areas? Is it a fact that the smallest rural automaticexchange now available is a 40-sub- scriber unit, which is too large to meet the needs of many districts? Will the Minister inform the House whether any investigations have been made, or are being made, into the practicability of having twenty-subscriber or ten-subscriber units ? If investigations have been made, what are the prospects of such smaller units becoming available, and when? If such investigations have not been made, will he endeavour to have them carried out?


– Forty-unit automatic exchanges are the smallest that the Postmaster-General’s Department installs, but we have experimented with smaller exchanges. For example, there are now two experimental stations in which tensubscriber units have been operating, but our technical officers consider that they would not be entirely satisfactory except for a purely local circuit. In other words, they would not be satisfactory for trunk-line circuits. However, we have not sufficient information yet to come to any decision about whether they could be more widely applied.


– I direct to the PostmasterGeneral a question regarding a promised mobile exchange at Peakhurst, New South Wales. The honorable gentleman promised me that it would be in service in June, 1950. Is he aware that the exchange has not yet been installed, that some preliminary work on it that was being carried out has ceased, and that some applicants for telephones in that district have been waiting up to seven years for telephones? Will the dismissals of staff engaged in postal works have any effect in further delaying the completion of that exchange?


– I shall have the matter examined and will furnish the honorable gentleman with a reply.

page 1075




– Can the PostmasterGeneral inform me whether it is possible for philatelists to obtain their fair shape of imprinted blocks of new issue stamps by the normal method of purchase, over a post office counter? If not, would he consider the adoption of a system which exists in New Zealand, whereby bona fide stamp collectors are enabled to purchase two imprints of any current stamps from the PostmasterGeneral’s Department?


– We have a considerable amount of trouble with philatelists who desire to obtain the last four stamps on a sheet of stamps because on the selvage of the last four stamps there appears the imprint “ Commonwealth Government Printer “. This seems to have special significance to philatelists, and. consequently, post office staffs are given a great deal of trouble in trying to supply the last four stamps to people who request them. I have under consideration the abolition of the imprint block as a solution, to the trouble.

page 1076




– Is the Minister for the Army aware that the utilization for army purposes of the establishment at Watsonia, Victoria, will automatically mean that the families using that place as an emergency housing centre will be evicted ? Has the Minister received representations on the subject from the Government of Victoria? If so, what was the nature of those representations and what was his reply to them? As the compulsory evacuation of the present tenants will mean acute hardship to them and an accentuation of Victoria’s housing difficulties, docs the Government propose to assist the State in its endeavour to have the displaced persons supplied with alternative accommodation?

Minister for the Army · MORETON, QUEENSLAND · LP

– A very considerable time ago the Watsonia camp was made available, under an agreement, to the Victorian Government. The agreement provided that the Victorian Government was to use it for housing people if it so desired. The agreement expired some time ago. I regret that, at the moment, I cannot state the actual date of expiry although I think that it was earlier this year. However, with the concurrence of the House, I shall make a full statement on this point later to-day. It is- imperative that the Army should have the use: of camps constructed for it during the last war in order that the defences of this country may be adequately prepared.

Mr Ward:

– Does the Minister not think it imperative that people should have homes?


– It is an imperative obligation-


– Order! The honorable Minister should not answer interjections.


– I think that it is imperative that a statement should not be broadcast that the Government has no regard for the people who are at present living in the camp. There is an obligation on the Victorian Government to honour its agreement. It has had a considerable number of years in which to provide homes for these people, and if it had done its job properly they would be housed to-day. I know the difficulties of this problem but the Army should be in the quarters that it needs for the defence of this country. We are endeavouring to establish a second brigade group of 5,500 men, together with ancillary troops, and it is urgent that they should go into camp to be trained. I have made representations through the Prime Minister’ to the Premier of Victoria and have asked him to make the camp available according to the agreement. I have not yet received any reply from, the Premier of Victoria.


Minister for the Army · Moreton · LP

by leave - On the 15th March, 1950, a lease of Watsonia Camp to the Victorian Government was signed by the Solicitor-General on behalf of the Commonwealth and by the representative of the Board of Land and Works on behalf of the Victorian Government. The lease was in respect of a period of two years from the 20ih August, 1049, and provided1 that thereafter occupation should be on a monthly tenancy basis. The rental of the property was- to be £1,200 per annum, payable monthly. The lease incorporated’: conditions providing for the preservation of the buildings and the taking of precautions against fire. I desire to draw the attention of the House to two specific features of the agreement which read as follows : -

If at any time; during, the’ term or any extension thereof the premises are required’’ by the Army as an urgent Army requirement seven days’ notice will be given to the lessee who will deliver up possession and no compensation will be payable.

At the expiration of the term, 19 th August, 1051, the lessee may remain in possession on a monthly tenancy basis terminable by seven days! notice in. writing.

On the 20th June, the Department of the Interior- advised the Victorian Government that. Watsonia Camp was: now a firm Army requirement. It waypointed out that the Army realized the difficulty, of re-establishing the families at present at Watsonia and that, although the lease expired on the 19th August last, the Army was agreeable to delaying its occupation until March, 1952. On the 28th June, the Department, of the Interior advised that action had been, taken to advise the State government that vacant possession of Watsonia Camp was required on or before 1st March, 1952. The agreement is specific. The Australian Government has granted the Victorian Government an extension of time to vacate the property. The Premier of Victoria entered into this agreement quite voluntarily and I expect him to honour it.

page 1077




– Is- the Minister for Supply aware- of recent criticism of the progress of work at the Woomera rocket range? Is it true that work at the range is so far behind, schedule, that British experimental authorities are considering diverting their tests to the United States of America and that one British firm experimenting, with an automatic sextant for air navigation has already transferred operations to the American, range ? Are those criticisms correct. What is the present” position of work- at the range ?

Minister for Supply · PARRAMATTA, NEW SOUTH WALES · LP

– I saw- the article in last week’s Sunday Herald, signed, I think, by a gentleman–


– Order ! The question has no relevance to a newspaper article. The Minister cannot refer to a newspaper article in reply to- a question.


– It came to my knowledge that somebody had made criticisms along, the lines mentioned by the honorable member. All that I can say is that the person concerned has been indulging in a considerable flight’ of fancy, because three months ago Sir Alec Coryton, chief, of the guided missiles section of the British Ministry of Supply, and Sir Harry- Garner, chief scientist of the British Ministry of Supply, came to Australia at the invitation of the Government for the purpose of’, giving us their opinion of the position at Salisbury and. Woomera. I saw these gentlemen before they left Australia and they told me in specific terms that they were satisfied with the progress being made, and generally they were highly complimentary about our progress. About; two or three weeks ago there was a highlevel conference in London at which-i officers from the British Department of Supply who. had been here- expressed somewhat similar views. We are testing a number of specific projects and also: doing; some manufacturing in Australia’ by arrangement with the British Government, but the sextant mentioned by the honorable member is not one of the pro*jects. Therefore, the reference made is quite unintelligible to me. I do not think that our set-up at. Woomera has been properly understood. A suggestion has been, made that the British Governmenthas sunk millions of ‘ pounds in Woomera. That is not so. By and large the British Government has spent; millions of. pounds, in. the British side o£ the project, while., we have spent millions of pounds in our’ side of it here in Australia.. All I can. say is. that although hitches and delays, are unavoidable in such a gigantic undertaking, there ground for suggesting-, that: we. are not up to schedule;,

page 1077




– In view of the fact,, of which- all honorable, members are aware, that during the last eighteen months business undertakings of all kinds have been making exorbitant profits, will the Vice-President of the Executive Council endeavour to persuade the Governrnent to appoint a royal commission or a parliamentary committee to investigate company profits and the part they, play in causing inflation, and empower it to recommend to the Parliament legislation for the purpose: of curbing exploitation of consumers?


– I shall give consideration to the matter the honorable gentleman has raised.

page 1078




– Can the Minister for Health say whether the pensioners’ medical service, which was commenced last July, is proving very successful? ls it correct that pensioners, instead of having to queue up all day at hospitals can now visit a doctor in their locality and obtain a prescription for medicine which they can then have made up without cost by the nearest chemist? Is it also correct that the free drug scheme has reduced the cost of medical treatment at a time when such treatment is most needed by patients? If the answer to each of those questions is in the negative, will the right honorable gentleman correct the statement to the contrary that has been attributed to the Acting Federal President of the Federated Pharmaceutical Services Guild of Australia?

Minister for Health · COWPER, NEW SOUTH WALES · CP

– The pensioners’ medical service scheme was commenced last February and the pensioners’ free medicine scheme was commenced last July. The medical service scheme has proved very successful. I have ascertained that during the last six months doctors have made no fewer than 350,000 visits to homes of pensioners and have attended to approximately 330,000 calls at their surgeries. The cost of such services has amounted to approximately £264,000, which works out at an average cost of from 7s. to 8s. a visit. The free medicine scheme has been working smoothly largely as a result of the full co-operation of doctors, chemists and patients. Although life-saving drugs are much more costly than other drugs and constitute only one-quarter of the total prescriptions written, the provision of such drugs under the scheme has practically halved the cost of medicine generally to patients. The scheme has been working smoothly largely because of the fact that, by keen and enthusiastic handling of matters by the department, accounts of chemists and doctors have been paid within a fortnight of the last day of each month.

page 1078




– I address a question to the honorable member for Corio in his capacity as chairman of the sports sub-committee of the Commonwealth Jubilee Celebrations Committee. Can he say whether it is intended to strike an appropriate jubilee medal for presentation to outstanding amateur sportsmen or to sporting bodies ? If so, under what conditions will such medals be made available?


– The jubilee celebrations sports sub-committee, at the outset of its activities, selected a number of sports as being representative of Australian sporting activities and, by arrangement with sporting bodies, medallions were presented to those persons who represented their States in Australian championship events. The conditions which govern such presentations have already been defined, and th, medallions have been distributed to various sporting bodies. Special cups have also been presented as symbols to teams that have won Australian championships. If I can give the honorable gentleman more information about those matters I shall be glad to do so, but I assure him that the position has been well covered.

page 1078




– Will the Minister for the Army inform me of the relation of the recently announced school for training officers for the Army and the Australian Staff College? What will be the length of course which students will undergo and what will be their relationship, after graduation, to graduates from the staff college in regard to appointments, promotion and superannuation?


– Training at the new cadet officers’ training school will commence on the 7th January next. The selected men will be junior officers, and the course will be for 22 weeks. The men, on the completion of that course, will graduate with the rank of second lieutenant. They will then be allotted, primarily on their own choice, to the various services within the Army, and will undergo a specialist course in the particular groups that :hey select, such as artillery, signals and engineers, &c. At the end of four years, they will be promoted to the rank of lieutenant, and future promotion will be determined in accordance with efficiency and period of service. There will be no conflict between men who graduate from the officers’ training school and those who graduate from the Royal Military College at Duntroon.

page 1079




– I desire to address a question to the Minister for Immigration. Can he inform me whether it is a fact that when permits are issued for Japanese wool-buyers to visit Australia for the purpose of purchasing their wool requirements, the holders of such permits are allowed to bring with them numbers of Japanese attendants, such as clerical hands? Is it also a fact that there are organized agencies in Australia which are well equipped with Australian employees, and capable, and willing to give -that service? Will the Minister ensure that restrictions will be placed on Japanese wool-buyers in order to limit the number of supernumeraries whom they bring with them when they visit this country?


– It is not a fact that vises authorized for the admission of Japanese extend to the clerks and assistants of the representatives of established business houses. The vises are confined to those persons who directly represent the established business houses, and are not extended so far as to include clerks or assistants and, indeed, at this time, they do not include the wives or other members of the families of the direct representatives of Japanese business houses. Vises are generally limited, in point of time, to a period of three months. I understand that there are agencies which are equipped to carry out any clerical work that may be necessary to assist Japanese wool-buyers, and I have no doubt that the visitors will take advantage of those services while they are in Australia. There are other conditions which apply to the entry of Japanese nationals, and I shall supply them to the honorable gentleman in a letter in order to avoid taking up too much time at this juncture.

page 1079




– My question to the Minister for Civil Aviation arises out of a recent air accident in Western Australia, and one that happened a number of years ago. It was alleged at that time that an aircraft had disintegrated in flight, and that an examination by microscope of another aircraft of a similar type revealed that the wings and fuselage showed evidence of cracking. Will the Minister have inquiries made at every airport where aircraft are based to ascertain for the information of the House how frequently examinations of wings and fuselage are made, and how much it has become a custom to make merely inspections of engines and general maintenance ?


– The examinations are made periodically. I am not able to tell the honorable gentleman offhand the precise intervals between them, but I shall obtain that information for him. The recent air accident in Western Australia brought ti the notice of the Department of Civil Aviation what it thought might be structural weaknesses in aircraft of certain types. Those aircraft have been grounded until a complete examination of them can be made. I shall have inquiries made into the other aspects of the honorable gentleman’s question, and inform him of the result.

page 1079




– Can the Minister representing the Minister for Trade and Customs indicate whether the terms of reference have been drafted for the Tariff Board to make a further investigation into the rayon weaving industry in Australia? If those terms of reference have not been drafted, can he indicate whether it is the intention of the Minister for Trade and Customs to have that investigation undertaken? I ask the question in view of the fact that in December last, when the legislation for .the implementation of the tariff on rayon was before the House, the Minister promised that by the end of June, 1951. he would have terms of reference drafted to enable the

Tariff Board to make a further investigation into the rayon weaving industry in Australia.


– I have no knowledge of the matters to which the honorable member for Lilley has referred, but I shall see that his question is brought to the notice of the Minister for Trade and Customs, and I shall ask my colleague to set out the position clearly for the honorable gentleman in a letter.


– In view of the unsettled international situation, can the Minister for Supply inform the House of the steps that his department is taking, or will take, to ensure that, in the event of an emergency, there will be adequate supplies of textile materials and clothing for the defence forces?


– -Considerable action has already been taken in this matter. Representatives of my department have had a conference with leaders of the textile industry, both wool and cotton, in Australia and they have shown their willingness to co-operate with us. We have already ordered some millions of yards of material to be made into uniforms, a great quantitiy of leather for footwear, and other commodities such as tentage. All of this has been done in anticipation of future requirements. Within the last few days we have given approval to very large contracts, involving many hundreds of thousands of pounds, for the supply of certain materials. These orders will provide for future requirements. As for the needs of national service trainees, the Minister for the Army will acknowledge that the demands of his department have been met up to date and some millions of yards of materials and large numbers of uniforms have been provided.

page 1080




– Has the Vice-President of the Executive Council read a report to the effect that the Aberdare Extended coal mine is now on fire? Is it a fact that about fifteen coal mines in New South Wales are now on fire? I remind the honorable gentleman that, on a previous occasion, I asked the Prime Minister whether he was aware that the Government of New South Wales had appointed a conservation committee to try to protect the Greta seam of coal from fires that are caused by spontaneous combustion. He said that he would investigate the matter, but I have not yet had a further reply from him. In the meantime, another fire has started. This is a very urgent matter and I ask the VicePresident of the Executive Council to communicate with the State government with the object of having a committee appointed at once.


– I shall refer the matter to the Prime Minister and ask him to have the necessary action taken.

page 1080




– The question that I direct to the Vice-President of the Executive Council, in the absence of the Prime Minister, relates to the desperate situation that has arisen in Queensland as a result of the non-arrival of steel products from the south. I have received a letter from the Minister for Shipping and Transport which states that the factors associated with this situation are, first, the refusal of seamen to handle ships; and, secondly, the refusal of waterside workers to unload the ships. Finally, the honorable gentleman wrote that we could rest assured that the Government was doing everything in its power to put an end to communistic activities and that it hoped that something would be done about those activities in the near future. Does the Vice-President of the Executive Council agree that those are .the factors associated with the situation to which 1 have referred? If communistic activities are to blame, when can we expect the Government to put an end to them in accordance with the promises that were made by its members and supporters in 1949 and 1951? In any event, will the Vice-President of the Executive Council consult the Prime Minister with the object of ensuring that the utmost shall be done to put an end to the desperate and precarious situation in Queensland that has been caused by the shortage of steel?


– I believe that the factors mentioned in the letter to which the honorable member has referred are of considerable substance. I have no doubt that the Government will soon seek the co-operation of the Opposition in dealing with the Communist menace. I hope that the Opposition will not run away from its obligations then as it has done on other occasions.

page 1081




– -Will the Minister for Supply inform me of the present price of tin in Australia?: What is the world parity price of tin? Who fixes the price that is paid to Australian tin producers? Is there a just and fair relationship between the home price and the world parity price?


– The Australian price of tin is fixed by the State authorities. The present price is just over £1,150 a ton in terms of Australian currency. The London price at present, I think, is £1,025 sterling. The overseas price, of course, fluctuates considerably from day to day as the financial columns of the newspapers show. I consider that there is a fanrelationship between the overseas price and the Australian price.

page 1081




– In the absence of the Leader of the Opposition, I ask the honorable member for Melbourne, as the Deputy Leader of the Opposition, whether he is aware that the Primary Producers’ Organization and Marketing Acts Amendment Act 1951, which was recently introduced by the Labour Government of Queensland, contains sections that authorize persons to enter premises without search warrants and to seize property. Is it also a fact that section 12b of the act reverses the “ onus of proof “ and, in fact, does not allow of any defence? Does the honorable gentleman know whether this act is a contravention of section 92 of the Australian Constitution?


-Order! That is a matter of law which cannot be dealt with in answer to a question.


– I conclude by asking the honorable gentleman whether, in view of the claims that he and his leader made during the recent referendum campaign concerning the principles of British justice, he and his. leader will use their influence in order to try to persuade the Labour Government of Queensland to repeal this iniquitous act.


– I am a little out of practice at answering questions, but I listened carefully to the honorable gentleman’s complaint. I believe that whatever the Queensland Labour Government has done, and, in fact, whatever any Labour government anywhere has ever done, has been done from the highest of motives and in the best interests of the people. I shall take note of what the honorable gentleman has said and ask the Acting Premier of Queensland to supply me with a complete, adequate, and, I have no doubt, devastating reply.

page 1081




– Is the Minister for the Navy in a position to give the House any information regarding the suitability or otherwise of carrier-based Sea Fury and Fire Fly fighter aircraft for operational service under modern conditions? Will he state whether the losses of those types of aircraft based on the aircraft-carrier H.M.A.S. Sydney, which is at present serving in Korean waters, have been, as heavy as the losses of similar aircraft that are based on the British carrier H.M.S. Glory11. Has the Government any plans to equip the Australian Fleet Air Arm with more modern and less vulnerable aircraft than Sea Furies and Fire Flies?

Minister for Air · LOWE, NEW SOUTH WALES · LP

– During the course, of the last few days I have received from the Commander-in-Chief of the Far Eastern Squadron a report on the operations that have been carried out from H.M.A.S. Sydney. The report is so extraordinarily good that I decided that I should take the opportunity at a later stage to inform the House of its contents. H.M.A.S. Sydney has not, to my knowledge, lost any aircraft during the recent Korean operations. The CommanderinChief complimented H.M.A.S. Sydney on having flown the record number of 89 sorties in one day, which was its first day out. Expressing himself in cricket language, he said that the performance was good, batting, even for an opening match. In our opinion, H.M.A.S. Sydney is at least equal to H.M.S. Glory. It is one of the finest medium aircraft-carriers in operation. We have plans for replacing the two types of aircraft that the honorable member has mentioned. New types of aircraft are under order at present, and they will be based on H.M.A.S. Sydney as soon as they come off the production lines. I assure the House that there were no losses of aircraft operating from H.M.A.S. Sydney on its initial operation. The carrier is putting up a valiant performance, and the CommanderinChief of the Far Eastern Squadron has gone out of his way to praise its personnel.

page 1082




– No doubt the Minister for Labour and National Service is aware that it is the practice of most insurance companies to put a loading on life insurance premiums in certain circumstances. This practice involves the placing of an additional loading on life premiums paid by. national service trainees called up for service in the Royal Australian Air Force. In consequence of that practice, trainees who serve in the Air Force are faced with an additional financial commitment which is not required of trainees who enter either of the other two services. Will the Minister indicate whether the Government will try to come to some agreement with the insurance companies or make some other arrangement so as to remove this inequity?


– I shall be very glad to examine the interesting suggestion advanced by the honorable member. He may be sure that if any practical arrangement along the lines that he has proposed can be worked out it will be done.


Minister for Labour and National Service and Minister for Immigration · LP

by leave - On the 3rd October last, the honorable member for Kingston (Mr. Galvin), speaking on the motion for the adjournment of the House, referred to the case of a young resident of St. Leonards, South Australia, who, he said, had been passed as medically fit for national service training, despite the fact that he had been a sufferer from poliomyelitis. I undertook to have a full ex amination made of the case and have caused very full inquiries to be made in my own department. The Minister for the Army (Mr. Francis) has conducted inquiries also. The reports received disclose that this youth, in his registration form, described himself as “ Polio patient - slight limp in left leg “. He was medically examined on the 13th June by a medical board constituted under the National Service Act of two doctors, one of whom had four years’ service in the Australian Imperial Force during the war. The board was aware that the youth suffered from poliomyelitis. The entry on the medical history sheet reads, “ Polio December, 1949, left leg and hip still affected “. The record of physical examination shows, “Very slight limp left leg”. Under the heading of “Particulars of any existing disability” appears the entry, “ Mild limp following polio of left leg”. The summing up by the medical hoard states -

After thorough questioning, recruit states that he has walked twice from Adelaide to Glenelg without trouble and walks half a mile to work each day. We consider did ability is not sufficient to disqualify.

The board therefore classed him as “ A “. In view of his medical classification, he was called up to commence service with the Army on the 6th August. The report of the medical examination signed by the examining doctors shows that the examination was a comprehensive one and was conscientiously carried out. The medical board was aware that the youth had suffered from polio. It seems evident from the various medical reports that the outward signs of his disability arc slight. The honorable member has stated that one leg was “shorter and thinner than the other “ and that “ he had a decided limp “, but the lad himself described his limp as “ slight “ ; the medical board assessed it as “ mild “ and the Army medical board which examined him prior to his discharge, reported “no apparent limp”.

Two days after commencing training the lad reported to his regimental aid post and stated that he was unable to keep in step or keep up with the rest of his section. He was put on light duty- and advised to try to take part in training activities as much as he could. When he was later told that he would be medically boarded, he asked that this action be deferred as he wanted to make a further attempt to continue his national service training. The board, which was delayed for some days, accordingly, found him class “ D “. The opinion is expressed in the reports received that his general physical condition on discharge was much the same as when he first entered camp. He is alleged to have been approximately the same weight on discharge as on entry into training.

I am advised that a history of poliomyelitis is not, in itself, a cause for not classifying a registrant as class “ A “, that is to say, fit for all service duties. The severity and after-effects of the attacks vary between wide extremes and many men who have suffered from poliomyelitis have proved quite capable of standing up to the physical demands of Army service. The task of the medical board is to determine whether the registrant has a disability that is incompatible with service. This involves examination of his functions, for example, his locomotion and ability to handle weapons, to determine whether they are adequate in relation to the demands of service. Reliance has therefore to be placed upon the professional judgment of the medical board in assessing the registrant’s functions. It is inevitable that occasional errors of judgment will be made, but any suggestion that the medical examinations for national service are slipshod is without foundation. I am informed by the Army that their latest figures show that of 8,641 young men called up for service in the Army, only eight in the whole Commonwealth have subsequently been discharged on medical grounds.

In this case, the medical board decided, on the basis of the medical history, the physical examination and the information given by the registrant as to his capacity for normal activity and exercise, that his disability was not sufficient to justify his classification below class A. It is evident from subsequent events that the medical board was mistaken in its opinion. It seems that in making its assessment the board was influenced by the youth’s own statement, recorded on the medical report form, of his ability to walk long distances without ill effect. The lad’s desire to undertake his training is also borne out by the other events mentioned.

The instructions on the medical examinations have been re-examined, and no amendment seems necessary as a result of this case. It is impossible to devise a system of medical examination that does not place reliance to a considerable extent upon the professional judgment of the members of the medical board. Full inquiries have been made regarding the alleged submission of the medical certificate to the Army authorities by this youth before he entered camp, but they have failed to disclose any evidence of the incident, nor can any such certificate be traced.,

Mr Rosevear:

– Is it denied that this incident occurred?


– I am not aware that there has been any denial, but I suggest to the honorable member that the other facts to which I have referred, notably the evident desire of the youth to engage in training, seem to run contrary to any suggestion that he had produced a medical certificate showing him to be unsuitable for training. I shall pursue this aspect further if additional details can be supplied. Inquiries made have not disclosed any evidence that the young man was unfit to return to his job. It is competent for him, if he wishes, to submit a claim to the Army for compensation in accordance with the provisions of the Commonwealth Employees Compensation Act. If he does see fit to make such a claim, it will be given the fullest consideration.

Mr Calwell:

– Is it desired that the paper be printed?


– I should be prepared to move that it be printed, but I think that it would be in the interests of the honorable member who raised the matter to leave it where it now stands. He could then raise it again on a motion for the adjournment of the House.

page 1083


Motion (by Mr. Eric J. Harrison) - agreed to -

That leave be given to bring in a bill for an act to repeal the Excise Tariff Rebate Act 1944.

Bill presented,, and read a first time.

Second Reading

Vice-President of the Executive Council and Minister for Defence Production · WENTWORTH, NEW SOUTH WALES · UAP; LP from 1944

by leave - I move -

That the bill be now read a second time.

The purpose of this bill is to repeal, as on and from the 27th September, 1951, the provisions of the Excise Tariff Rebate Act 1944. In 1944, the government of the day made provision, in the Excise Tariff Rebate Act, for a rebate to be allowed, as on and from 1st November, 1943, to manufacturers in Australia of tobacco, cigars and cigarettes to the extent of 4½ per cent. of the excise duties collected on the products mentioned.

Honorable members may recall that when the original measure was before this House a policy of uniform prices control operated throughout the Commonwealth and in order to obviate a rise taking place in the retail prices of tobacco, cigarettes and cigars, because of increased costs of imported tobacco leaf, the then government met the position by remitting to the manufacturers concerned portion of the excise revenue. The 4½ per cent. rebate remained unchanged until the introduction of the excise tariff proposals associated with the 1951-52 budget. In those proposals the excise duties on manufactured tobacco, cigars and cigarettes were not increased to as great an extent as the corresponding customs duties on the same type of products. This action was taken so that the Excise Tariff Rebate Act could be repealed without disrupting the relativity between the customs and excise duties.

Apart from any other consideration it is, I suggest, desirable that, as far as is possible, the rates of duty shown in the excise tariff should be expressed as net rates. The repeal of the act referred to in this bill will achieve this purpose. This bill is merely a machinery measure and full opportunity willbe available at a later stage to discuss the rates of customs and excise duties on manufactured tobacco, cigars and cigarettes when the relevant motions are tinder consideration. I therefore suggest that the Opposition might see fit to agree to the bill being passed immediately.


.- The Opposition does not object to the second reading being agreed to and the bill being passed through all stages without delay. It accepts as satisfactory the assurance given by the Vice-President of the Executive Council that the measure is purely a machinery one, and that opportunity will be given to debate the rates of duty on tobacco, cigars and cigarettes at a later stage.

Question resolved in the affirmative.

Bill read a second time, and reported from committee without amendment or debate; report adopted.

Bill - by leave - read a third time.

page 1084

SUPPLY BILL (No. 2) 1951-52

Second Reading

Debate resumed from the 26th September (vide page 117), on motion by Sir Arthur Fadden -

That the bill be now read a second time.


.- This bill will make provision for supply for a period of two months up to the 31st December next. The Opposition does not intend to delay its passage because the moneys to be appropriated by it are required for the payment of salaries and pensions and for the financing of services to the community generally. However, there are some matters of very great importance to which the Opposition desires to draw the attention of the Government. In the first instance, there is the Japanese peace treaty. The Parliament has not yet been told when the Government proposes to bring that treaty forward for ratification. We have been told that the treaty has been signed on behalf of Australia and also that several other countries have signed it. I understand also that some countries have ratified it. It will be a grave reflection on the Government, and an insult to the Parliament, if this sessional period ends without the Parliament having been given an opportunity to consider the ratification of the treaty. The Parliament will have been treated with great disrespect if it be not given the same opportunity, before the end of this year, asother democratic parliaments will be given, to express its views on the provisions of a treaty which, to many Australians and, in fact, I believe to a majority of Australians, is a most obnoxious document. There is a great deal of feeling in this country about Australia’s part in subscribing to the peace treaty, and there is a good deal of objection to some of its provisions. The Vice-President of the Executive Council (Mr. Eric J. Harrison) should inform the Government that the Parliament and the nation expect a bill providing for the ratification of the treaty to be brought down within the next week or so. If the Government fails to intimate when such a measure will be introduced the only conclusion that anybody can draw is that it is afraid to face the Parliament with the bill. The Vice-President of the Executive Council might be amused at the suggestion that the Government is afraid to face the Parliament with the bill, but I can assure him that there is a great deal of feeling everywhere in Australia about the matter.

Mr Rosevear:

– There is a great deal of explaining to be done, too.


– That is so. There is a deal of explaining to be done by the Government not only in regard to its action in signing the treaty but also in regard to its action in agreeing to a bad provision-


– That is also what the Soviet says.


– The other day the Vice-President of the Executive Council and Mr. Gromyko were in agreement about the Leader of the Opposition (Dr. Evatt).


– We were not. We were in complete opposition.


– I have not the slightest doubt that the Vice-President of the Executive Council and the Russian Foreign Office will be in agreement on many other matters that affect Japan. The Opposition wants to say in this House, where it should be said, that it does not agree with what has been done.

The second matter to which I want to refer has reference to the distribution of the £63,000,000 which remains in the Joint Organization accounts. The Joint

Organization scheme was initiated during the war period to ensure the orderly marketing of the wool of Australian graziers, and it has been a tremendous success. The last Labour Government paid £25,000,000 of that money to the growers two years before it knew the final amount that would be in the fund. At that time the Labour Government did not know when all the wool would be sold, nor what amount would be available for distribution. The fund closed last June, and there is £63,000,000 in it which belongs to the wool-growers of Australia and to nobody else. It is their money, and they are entitled to it and should have it immediately. The Government will not say when it will pay them. All that it says is that it will pay them sometime. The Government feels afraid to pay them now, because it says that if it did so the spiral of increasing prices would be accentuated. If the Government wants to keep the graziers’ money, then, as was suggested by the honorable member for Wannon (Mr. McLeod), it should pay them interest for it.

The woolgrowers want that money to-day because, while wool prices are falling, all other prices, including the prices of food and essential equipment for their farms are rising rapidly. Moreover, income tax, sales tax, and company tax have all risen and will affect the farmers as well as everybody else. We have been told that this year Australia’s wool clip will yield £200,000,000 less than last year’s clip yielded. If the £63,000,000 is paid to the growers now it will help them to offset all their increasing costs and help them to meet the losses occasioned by falling wool prices. The Government should immediately tell the Parliament of its intentions on this matter.

The third matter I shall mention has reference to the decisions of the Loan Council. Honorable members on this side of the House have tried to find out what happened at the last Loan Council meeting. We have had great difficulty in getting any information at all about the meeting. All that I know about the Loan Council’s decisions is contained in a statement which was issued at the termination of the meeting on the 17th August, and that statement occupied only one foolscap page. It showed the total amount of money spent by the Australian and the State governments during the year 1950-51, the amount approved for 1950-51, and the amount approved for 1951-52. The statement also showed the details of the approval granted by the Loan Council to aggregate borrowings by semi-governmental and local government authorities. The final paragraph of the statement contained an observation in respect of semi-governmental authorities that the Loan Council had decided that each premier should endeavour to effect the reduction of 25 per cent, on works programmes in order to agree with the principle observed in the Commonwealth programmes. In an attempt to find out what happened at the Loan Council meeting, I wrote a letter to the Secretary to the Treasury, in which 3 asked to he informed of -

  1. The amount of loan accommodation requested by State government for housing purposes in this financial year.

    1. The amount recommended in each instance by the Commonwealth Co-Ordinator General of Works after consultation with th» Commonwealth Director of Housing.
  2. The amount made available by the Loan Council for each State.

In his reply to me, Dr. “Wilson, the Secretary to the Treasury, said -

Information on the first of these points is not as a rule made public, and as it is a matter between Commonwealth and State governments, we would be reluctant to make it available unless authorized to do so by the State governments.

E have no doubt that this practice has been followed for many years, perhaps since the establishment of the Loan Council after the alteration of the Constitution in 1927. At present, when State governments are fighting desperately for loan money with which to carry out important developmental projects, I think that the Australian Parliament should be told, in far greater detail than is being supplied at the present time, precisely what has happened at Loan Council meetings. Dr. Wilson continued -

Your second question involves information furnished to the Loan Council. As no doubt you know, the Loan Council meets in camera and, as a standing rule, the only official statement on proceedings at the Loan Council or on information given to it is contained in the statement of decisions published at the end of each meeting. Formally it would require the permission of all members of the Loan Council if any information beyond this were to be made public.

I suggest that the Vice-President of the Executive Council should ask the Prime Minister (Mr. Menzies) to raise this matter at the next meeting of the Commonwealth and State Ministers or of the Loan Council in order that the procedure might be varied so that the permission of all members of the Loan Council for the disclosure of such information would not be necessary. 1 do not think that it is any more necessary that the Loan Council should meet in camera to discuss the requirements of the States about loan raisings, than it is for this Parliament to sit in camera to discuss any details of expenditure or appropriation. Dr. Wilson further continued -

With regard to your third point, the position is that the Loan Council does not allocate finance between housing and other types of works. It approves of a total programme of borrowing for Commonwealth and State governments for a financial year and the distribution of that total amount as between the several governments. It is the decision it makes -on these subjects which is published after each annual meeting, as I have mentioned above.

The decision mentioned by Dr. Wilson was, as I have already said, contained in one foolscap sheet of typewritten matter. That merely supplied totals. It supplied no information to this Parliament or the people on the fate of each of the proposals made at the Loan. Council. Taking Dr. Wilson’s advice, I sought information from various State governments as to how they had been treated at the Loan Council. I ascertained that Queensland had asked for a £5,800,000 loan allocation for housing under the Commonwealth-State Housing Agreement. The Loan Council, under the direction of the Australian Government, allocated Queensland £4,489,000. New South Wales fared even worse. That State asked for £14,000,000 but received only £S,514,000. Victoria asked for £16,000,000-


– It would.


– The Country party Premier of Victoria asked for £16,000,000, and I should have expected the honorable member for Gwydir (Mr. Treloar) to have supported him in that request. The Loan Council decided that the Country party Government of Victoria should receive £10,061,000. What the odd £61,000 was for I do not know. The decision of the Loan Council will cause the disruption of the housing programmes in the three major States of the Commonwealth. Doubtless the same thing will happen in Western Australia, South Australia and Tasmania. The Victorian Government is in a grave dilemma at the moment because of the lack of sufficient loan money to enable it to carry out its great public works. The same observation is true of New South Wales and Queensland. The Metropolitan Board of Works in Victoria, which one honorable member opposite has mentioned by way of interjection, is a well-managed institution. I can speak with first-hand knowledge of its activities because I was a commissioner of the board for six years. It is a successful undertaking. Whereas all of its previous loans met with a ready response on the public market, the last loan that it floated was a failure because many investors believe that the present is an opportune time to raise interest rates. For that reason, the board’s recent conversion loan of £2,000,000 was only half-subscribed.

The position in respect of public works is desperate in all the States. Since the end of the recent war, advantage has been taken of the opportunity to undertake many works that should have been carried out during the depression years and, indeed, prior to the depression. The authorities responsible for the Snowy Mountain hydro-electric scheme, the Lachlan River and Darling River schemes in New South Wales, the Kiewa hydro-electric scheme and the Eldon Weir scheme in Victoria and various hydro-electric power and irrigation schemes in Queensland are finding it difficult to obtain adequate labour and materials. All of those works have an important defence value and should be completed as soon as possible. In common with all the developmental works that are being carried out by the States and by the Australian Government, those works relate largely to the generation of electricity for heat, lighting and power and the provision of more water for irrigation in order to increase the production of food. Their completion would enable us to achieve those objectives and to produce an exportable surplus of food to help the people of Great Britain and the people of Asian countries whose living standards we desire to raise in order to assist them in the fight against communism. The action of the Loan Council in restricting loan money to the States will seriously set back those developmental works, not for a year, but, in many instances, for two or three years. Whereas the organization of staffs for such undertakings is a laborious process, such staffs can disintegrate very easily. The refusal of the Loan Council to make available more loan money to the States will mean that not only the staffs but also the equipment of the governmental and semigovernmental bodies concerned will be dispersed with the result that the task of building up efficient organizations later will be made much more difficult.

Mr Haworth:

– An expert has said that that would not be the case so far as the Metropolitan Board of Works in Victoria is concerned.


– I am now referring to the other schemes that I have mentioned.

Mr Haworth:

– They are relative.


– Of course, everything is relative. I remind the honorable member for Isaacs (Mr. Haworth) that in 1942-43, the most critical period of the recent war, the Parliament passed a record budget of £706,000,000. Of course, that sum is infinitesimal compared with a budget of the gargantuan proportions of the budget for the current financial year. Of that amount, however, £554,000,000 was voted for war purposes. At that time, Australia was expending £10,000,000 a week on the war and if the conflict had continued for another few months we should not have worried about that additional expenditure. I recall that the Minister for External Affairs (Mr. Casey), when he was Treasurer, declared, “ In matters of war finance, the sky is the limit “. We must make available to the States sufficient money .to finance their developmental works and housing programmes. During the recent war we found it necessary to use treasury-bills even at the risk, by doing so, of increasing the dangers of inflation. The completion of the developmental works to which the States have committed themselves would provide benefits that would ultimately make it worthwhile to run whatever risks might be involved.

A little while ago the Minister for the Army (Mr. Francis) was granted leave to make a statement in which he made available information concerning an agreement-


– Order ! The honorable member may not refer to a matter that has previously been discussed in the course of the current sitting.


– I wish to deal with the position of the Victorian Government with respect to the Army camp at Watsonia. According to reports in to-day’s press, the Department of the Army has advised the Victorian Government that the camp at Watsonia must be evacuated next year. At present, 250 families, consisting of 1,300 persons, ars living in emergency accommodation at that camp. It is not a very wonderful place. Indeed, persons live there because they cannot obtain accommodation elsewhere. If the Government is determined to force those 1,300 persons on to the roads - they will have nowhere else to go - because the Army authorities wish to occupy the camp, it will perpetrate au inhuman act that will shock the conscience of the people. No one should be thrown out of the Watsonia camp or any other housing establishment until alternative accommodation has been made available for them. If the Government would make more money available to the Victorian Government to push on with its housing programme, accommodation could be found for such persons. However, the Government has said to Victoria, in effect, “You can have so much loan money to build houses, but we want you to expend money in importing prefabricated houses “. The Victorian Government complied with that request and let contracts overseas for the importation of prefabricated houses. To some degree it has disrupted its own programme by undertaking those commitments. All the prefabricated houses that it ordered have not yet arrived. More houses would have been erected in Victoria if the Government of that State had not, at the solicitation of the Australian Government, placed orders overseas for prefabricated houses. This Government should not penalize the Victorian Government for having followed a course that it advised that Government to follow. If the Department of the Army has to be told to abandon its decision to occupy Watsonia camp the Government must take that responsibility. It is far more important to permit those 1,300 persons to remain at that camp than to provide accommodation there for the Department of the Army. That department should be told to revise its plans. There is no immediate danger of war and no urgency to mobilize recruits. The current call-ups could be arranged to make allowance for the housing needs of the people who are now living at the Watsonia camp. In many instances, the heads of those families happen to be ex-servicemen. What will happen in Victoria if those 1,300 persons are told to get out by a certain date is a matter of conjecture, but bitter public opinion will be aroused by the Government if it proceeds with its proposal to evict them. Even the site is not suitable for a camp. It is largely a hospital site. Honorable members who know that part of Victoria will agree with me when I say that adjoining it are the Heidelberg Military Hospital, with 1,100 patients and a staff of 1,23S ; the Austin Hospital, with 263 patients, Heidelberg House, with 60 patients, and a staff of 508 for those two institutions; the Mont Park and Arundel Mental Asylums, with 1,600 patients and a staff of 400; the Bundoora Hospital, with between 250 and 300 patients, including many persons suffering from shell-shock, and the Janefield Hospital, with 200 patients, and a staff of approximately 200 for those two institutions. The Gresswell Sanitorium for patients with tuberculosis is close by. In other words, nearly 6,000 persons, patients and staff are in those hospitals, all of which are within between 2^ and 3 miles of the Watsonia camp. The Government should choose, and develop, another site farther from the city. However, I read in last night’s issue of the Melbourne

Herald that the Department of the Army and the Department of the Interior are determined to go ahead with their plans, and propose to acquire even more land. They have offered a Collins-street doctor £105,000 for 240 acres of land south of the Watsonia camp, and that is to be developed as an army site.

Mr Turnbull:

– What about the 9-J acres of land in the City of Melbourne, which the Labour Government acquired for Commonwealth offices?


– The honorable member for Mallee (Mr. Turnbull) has that subject on the brain. I wish that he would attend to matters in the Mallee, and leave matters in Melbourne to me, because I am the representative of that electorate, and do not need any assistance from any body in managing my affairs.

I urge the Government to give earnest consideration to the various matters which I have raised. The House should be informed as soon as possible when the Japanese peace treaty will be submitted to the Parliament for ratification, and when the wool-growers of Australia will be paid the sum of £63,000,000 which the Government is withholding from them at the present time. The Government should also announce its proposals for helping the Government of Victoria, and, indeed, the governments of all the States, to obtain more loan money, so that they will be able to provide all th« power that is needed for the new factories which are being established, and the heat and light which are needed in all the capital cities. The absence of heat is causing malnutrition, and has been a contributing factor in the deaths of some elderly people in Melbourne, at least during the last winter. The Government should also announce that it will reverse the decision about Watsonia, and not turn many unfortunate people out on to the road. Those persons have committed no crime, other than that of not being able to find accommodation for themselves in the City of Melbourne or its environs.

There are hundreds of thousands of people in Australia to-day who require houses. I suppose that I, as the previous Minister for Immigration, am responsible, in part, for the present difficult housing situation, because I believed in bringing to Australia as many people as we could get while we were able to get them. However, such a policy brings its difficulties, particularly in regard to housing, which must be met by State governments primarily, because they are responsible for the reception and housing of people who are born in the country, or who come from overseas and join their lives with ours. But the Commonwealth is bound to help the States in that matter, and the Loan Council has not assisted, and is not assisting, the State governments. Even the magnitude of a loan borrowing programme of £225,000,000 for this financial year is not beyond our capacity. If it is harming the community by accentuating intiation, let us introduce some of the economic controls which were exercised during World War II., when we used £300,000,000 of credit that was obtained by discounting treasury-bills with the Commonwealth Bank. That policy did not harm the economy. Surely we have learned much since the financial and economic depression of the 1930’s, when the <Senate refused to consent to a fiduciary note issue of £18,000,000, of which £1,000,000 was to be expended monthly to relieve unemployment, and £6,000,000 was to give the wheat-growers a return of 5s. a bushel. The government of the day was told by the bankers and the economists that a fiduciary note issue for £18,000,000 would ruin ‘the nation. Yet, during World War II., we used £300,000,000 of bank credit at one period, and we could do it again. I am not afraid of the dangers involved in discounting treasury-bills with the Commonwealth Bank, provided we introduce adequate controls, and prevent some people from growing richer out of the effort of the community to protect itself. The expenditure of loan money at this time on housing and developmental projects would be the best contribution that we could make to the future defence of Australia, and such money could be spent to much better advantage than the way in which the Government is spending some appropriations under the defence vote.


. -^1 think the honorable member for Melbourne (Mr. Calwell) has made his speech on the wrong bill. His references to the Australian Loan Council would have been more relevant to the Supply (Works and Services) Bill (No. 2) 1951-52. He roamed over the field from Tokyo to Port Phillip, and took advantage of the opportunity provided by a Supply Bill to deal with a number of extraneous matters. He knows perfectly well that he has already had , opportunity to discuss three of the matters that he has raised in the debate on this bill and that he will also have another opportunity to deal with them. He could have discussed the Australian Loan Council, and all its evils, on two or three other occasions that will arise. It seems to me that the honorable gentleman in debating the measure has missed the crux of the matter which is now under consideration. The House is asked to pass the Supply Bill (No. 2) 1951-52, the purpose of which is to authorize the Government to expend £68,000,000 in order to carry on the services of the Commonwealth until the Appropriation Bill has been passed.

I desire to point out that the delay in the introduction of the budget, and, consequently in the passing of the Estimates, which has necessitated the introduction of this supply measure, is due to circumstances outside the control of the Government. Normally, -the Government would have asked the Parliament to consider its financial proposals early in the financial year, instead of after the lapse of some four months. The reason for that delay may be found in circumstances over which the Government has had no control. Last April it contested a general election, following a double dissolution and, in September, it was engaged in a referendum campaign. Those interruptions meant that the whole time table for the presentation of its financial proposals to the Parliament was disorganized. However, I suggest to the Vice-President of the Executive Council (Mr. Eric J. Harrison), who is in charge of the House, that he bring to the notice of the Treasurer (Sir Arthur Fadden) a matter which, in my opinion, is important to this Parliament. T refer to the necessity for really recognizing the substance of parliamentary control of the purse. It is essential to realize that that is the only real control which the Parliament has over the Government. If the Parliament loses that control and merely retains the shadow instead of the substance, parliamentary control of the purse will have passed into the limbo.

I should like to point out briefly the problem which is involved in that matter. The Government, in presenting this bill to the House, is asking it to vote an amount of £68,000,000 for works and services pending the completion of the consideration of the Estimates and the passing of the Appropriation Bill. We should consider this bill in terms of the value of money to-day compared with its value even last year. Honorable members are aware that the Audit Act provides that the Government may spend under a supply bill only an amount that approximates the periodic proportion of the provision in the Estimates of the previous year. That practice has to he modified, because the value of money has depreciated. I recall that the Treasurer mentioned that matter when he presented his budget to this chamber. However, the House is now asked to vote to the Government for public works and services an amount which is approximately equal to the Estimates for the corresponding period in the last financial year. The result is that the Government is able to carry on only those works that were being undertaken last year. It is important for honorable members to realize the precise limitations which are imposed in that respect. If the Parliament is asked to deal with things which have already happened, it is obviously prevented from exercising proper control over the expenditure of public funds.

Then again, the expenditure of money by the Government has a great influence upon private finance, and, consequently, it is highly desirable that the Government announce its policy, and introduce legislation to implement it, at the beginning of a financial year, so that State governments and the public generally may know what they have to provide for. The honorable member for Melbourne has pointed out that the finances of the State governments are largely dependent upon the policy of the Commonwealth, and, therefore, it is important that they should know the details of that policy. Efficiency of administration is also involved in these matters. If officials are not in possession of authority to proceed with works at the beginning of a financial year, congestion occurs towards the end of that year, when money is spent without proper consideration merely because the Parliament has voted it. The Government departments are obliged to limit expenditure early in the financial year to activities that were being undertaken in the previous financial year because of budget delays. When the Estimates have been agreed to and the Appropriation Bill has been passed, the Government will be able to incur expenditure upon new projects. By that time, nearly six months of the current financial year will have expired. It is during the remainder of the financial year that inefficiency in public administration tends to occur. The Government finds that its activities are congested into the narrower, limited period of time, and it has to go ahead with expenditure which should have been commenced months earlier. I have no objection to this bill, but I suggest that the Government consider the desirability of altering its timetable next year. The Prime Minister (Mr. Menzies) has announced that he proposes to summon a conference of Commonwealth and State Ministers early next year to discuss the whole problem of the financial relations of the Commonwealth and the States. It would be an advantage if the Parliament knew precisely, at the beginning of the next financial year, the Government’s financial policy for 1952-53, instead of having to wait until the following September or October, as has been the experience this year.


.- I agree with the honorable member for Warringah (Mr. Bland) that the Parliament and the country should be informed of the Government’s financial policy. The Opposition has been constantly seeking that information during the last two years, yet we are still left in ignorance about it. The securing of that information is the major objective of the Opposition, because the Government’s financial policy, or rather the lack of it, is the major worry of the people. Absence financial policy is responsible for the major economic troubles in Australia to-day. Contradictory and complex proposals’ have completely confused the people. Those facts explain why the credit of the Australian Government, reflected in the loan market, is at a lower ebb to-day than it ha3 been for many years, although at this time it should be at its highest level.

The action of the Government in presenting its budget comparatively late in the financial year may be explained by such happenings as the general election last April and the referendum campaign, to which the honorable member for Warringah has referred, but its financial policies, so far as they have been disclosed, cannot be explained by those physical facts. Everything that the Government has done appears to be calculated to achieve two objectives. The first is quite deliberately to shake the confidence of the people in government securities. The second is to increase the inflationary pressures in this country. The Government should not attempt to cause either of those two things, but it appears to be doing so quite deliberately or wantonly by its lack of action.

During the recent parliamentary recess, the Government sold the Commonwealth’s shares in Amalgamated Wireless (Australasia) Limited. That transaction involved the sale of an Australian asset which was owned largely by the Australian people. The sale took place in circumstances that have not yet been explained. It is idle for the Government to say that the sale was in accordance with is de-socialization policy. Amalgamated Wireless (Australasia) Limited was only in part a government venture. It was the kind of undertaking that was praised by members of the present Government in the past, and was particularly acceptable to the former honorable member for Balaclava. Mr. T. W. White, who is now Australian High Commissioner in London. He referred to Amalgamated Wireless (Australasia) Limited repeatedly as an example of an ideal method of exploiting industries in which vast capital resources had been invested. It is an industry which, with the Commonwealth and private enterprise in partnership, has done great things for this country: That enterprise has been conducted under the management of a private operator, but a member of this Parliament was one of the directors. He is still a member of the Parliament, but I assume that he no longer attends meetings of the board, or draws fees as a director, that is, if he received any emolument in the past. The sale was made when the Parliament was in recess. Neither before nor afterwards was any effort made by the Government to explain why it had decided to dispose of its shareholding. Amalgamated Wireless (Australasia) Limited had paid a dividend of 12 per cent, on share capital in the previous financial year. Therefore, the decision could not have been made on the ground that there was not a reasonable return from the Government’s investment. It could not have been made on the ground that the company was not efficiently operated because, obviously, it is a highly efficient organization. It could not have been made on the ground that the company could not be adapted to cope with new developments in the field in which it is engaged. Clearly it ought to be one of the major organizations conducting experiments in television, and no doubt it has been taking an: active interest in that class of work. Had war occurred, this organization surely would have been one of the major companies engaged on government contracts. The asset of the Australian people was sacrificed because of some dream.

What is the true explanation of the Government’s conduct? The only one that seems to be consistent with Government financial policy is that the Government wanted to obtain the proceeds of the sale of this asset in order to meet its current commitments. That appears to be the only reasonable explanation because the Government is taxing the people in various ways in order to obtain from them during the present financial year money that would normally be obtained next year and in succeeding years. That is the general opinion of the transaction, and it is confirmed by the view that has been expressed by the gentleman who represented the Government and the Parliament of the Commonwealth on the board of directors, the right honorable member for

Bradfield (Mr:, Hughes). He said, “1 do. not know why the Government is’ selling the shares unless it is to balance its budget “. But, although the sale wasreprehensible in itself, the method by which the Government effected it- also, must be condemned as completely unbusinesslike and lacking even in com. mon sense. The Government held a huge parcel of shares which represented almost £2,000,000. Those shares had a good value according to- stock exchange reports.. It is true that their yield was relatively small, but their security value was good. Then the Government decided to sell in one day the entire block of shares that it held. The stock exchange, being unaccustomed to such transactions, naturally reacted sharply to the impact of the sudden sale.

The Opposition does not believe that the Government can offer a satisfactory explanation of its decision, in the first place, to sell the shares. But, even if it could do so, it would still have to explain why it made the tragic error of releasing almost £2,000,000 worth of shares in one day.. Assuming that the sale should have been made, the Government, ought to have followed another course of action. In the first place, as a leading member of the Labour party in Sydney has said, it should have offered the shares to employees of Amalgamated Wireless (Australasia) Limited. The Government,, when it want3 to win the support of the people, professes to believe in the policy of spreading the ownership of companies, as widely as possible among the peopleIt declares that employees in industry should have an interest in the management of the organizations for which they work. If that were a sincere declaration of policy, why did it not give the first option to purchase the shares to the employees of Amalgamated Wireless (Australasia) Limited?

Mr Kekwick:

– The shares were available for purchase by anybody.


– A minimum share subscription . was fixed, and that: effectively prevented, any but wealthy employees of the company from buying any of its shares. Deliberately, it would seem; the employees were excluded. They should’ have been given the first right to purchase. shares on terms that would have been attractive to them. The fact is that the Government’s decision to place all its shares on the market at once was certain to depress the market with the result, not only that it would sacrifice some of its own capital, but also that it would lower the value of the shares of the remaining holders. It was a brilliant philanthropic move ! The shares were sold at less than their true value. That was certain to happen in the circumstances. Thus, the Government sacrificed an asset of the people of Australia and forced a sacrifice upon other shareholders. That ‘was entirely consistent with its financial policy in general.

Successive Labour governments levied heavy taxes and raised loans from the Australian people in order to meet the expenses of government. The present Government adopted that policy initially but, because of the circumstances at the time, it needed additional funds with which to meet its commitments. It was successful with its early loan-raising programme. The quotas that were assigned to regional directors of the Security Loans Campaign were filled in every instance. Over-subscription was the rule. Every loan was closed almost in a matter of hours after its terms were announced. Indeed, many loans were practically filled by advance subscriptions. Yet, in thai: atmosphere the Government floated a loan at a discount. That was the first time since the national economy had been set on its feet under a Labour Administration that such a course of action had been followed. It was a clear indication to the investing public, of course, that an increase of interest rates was contemplated. However, that loan of £40,000,000 was over-subscribed by £8,000,000.

Mr Bowden:

– Under-subscribed !


– It was oversubscribed. The honorable member for Gippsland (Mr. Bowden) is not even conversant with recent history. The Government’s next move was to increase the interest rate. Its supporters say, of course, that this was done, not by the Government, but by the Loan Council. The truth is that it was done deliberately by the Government. Pressure was exerted on the members of the Loan Council and the votes of. this Government were used to achieve the desired result. Premiers were told that they must reduce their loan expenditure and must face an increased interest rate. They were told, I assume because the facts are kept secret, that unless they did as the Government wished it would, not raise the necessary money or guarantee to underwrite their loans. By using pressure in that way, the Government forced an increase of the interest rate for Government securities.

The immediate effect was that all subscribers to previous government loans, which were issued at 3^ per cent., suffered a loss of capital. That was a grievous blow because many of them are men and women who, in times of relatively high income, invested their savings in government loans. Many of them are trying to cash their holdings at present, and some of them are losing as much as S per cent, on their investments, which were based on faith in Australian governments. That action by the Government was bad enough but, when it issued its second loan, it made the announcement, as the result of either criminal negligence or something very like it, that the loan would be a small one to test the market. That made certain that the loan would be under-subscribed,, as of course it was in due course. The £40,000,000 loan was under-subscribed by £7,700,000 simply because the Govern? ment had said, in effect, that if it did not. succeed, the interest rate would be further increased. There could have been no other purpose in saying that the loan would be a small one to test the market for Australian securities. “Wise investors who could read the signs held off. Small investors, who believe in governments and government securities, invested their money in the loan that failed. They, too, will suffer if the Government again raises the interest fate on Commonwealth securities, as it appears clearly to be intent on doing. The interesting fact incidental to this Government move, which apparently was made under pressure from financial interests, is that the first of the two loans I have mentioned was issued at a discount of 1 per cent, at the same time as a Victorian government loan was placed on the market. The action of this Government guaranteed the failure of the Victorian loan. The second of the two loans was announced in almost exactly similar circumstances. The Government announced a loan at 33/4 per cent. at the same time as a Victorian instrumentality was issuing another loan. The increased rate of interest made the Victorian loan unattractive to investors and caused its failure.

The only construction that I can place upon that action by the Government is that it was a deliberate attempt to embarrass the Victorian Government. That opinion is supported by later developments. This Government informed the Victorian Government and other State governments that they were exceeding their rights in drawing upon man-power and materials for the public works programmes that they had agreed upon. The opinion is further supported by two statements that have been made in this House. The first of those statements was made by the Prime Minister (Mr. Menzies) during a recent debate, when he informed us that representatives of the State governments would be called together in- the new year and told, in effect, that unless they obeyed the Australian Government they would not be granted any money. That is consistent with the general pattern of the Government’s financial policy. The most recently appointed member of the Government, the Minister for the Navy (Mr. McMahon), provided further confirmation of the view when he spoke later in the debate to which I have referred. He said that, if the State governments believed that they could decide amongst themselves upon the programmes that they would follow and the loans that they would raise they were liable to be disillusioned very quickly. He said that their representatives would be called together and told what they could do, what they could spend, and what loan funds they could have. He indicated clearly that this Government, and not the Loan Council, would decide the extent and importance of their public works. Such decisions should be made by the Loan Council as the representative body of all governments, in the light of all circumstances. That also conforms to the whole pattern of this Government’s financial policy right from the time when, by fraud, I believe, and by plain deception, it gained its hold on the treasury bench.


– Order ! The honorable gentleman must not use the word “ fraud “ in respect of the Government. That is distinctly against the Standing Orders.


– I withdraw the word “ fraud “, and I say that by deception


– That is not much better. The honorable member is imputing an improper motive to the Government. Such imputations are contrary to the Standing Orders.


– In the circumstances I withdraw the words “ by deception”. I say that by every artifice and by the use of all the media of propaganda that were available to it the Government convinced the people that it could do certain things if it were returned to office. It has not attempted to do one of those things. This financial muddle which has been caused by the Government’s financial policy, the embarrassment which has been caused quite clearly and, it seems, deliberately to the State governments, and this dictation to the elected governments of not one State by all six States, about what they may do in future years, are in complete conformity with the pattern that the Government follows in all its financial dealings. Prices rose for twelve weeks and when, as everybody knew would happen, the basic wage consequently rose by 5s. a week, the Government was seized with panic and called an anti-inflation conference. That conference discussed the situation. The people who attended it agreed that something should be done, and done urgently, but according to what the Prime Minister told the conference the Government proposed, despite the agreement on the urgency of action, to defer such action for a month or six weeks, until the budget had been introduced. After the budget had been introduced prices kept rising day after day. The basic wage jumped another 14s., a week, and once again the Government became panic stricken. But now it has forgotten the problem again, and will continue to do so until the next basic wage adjustment of perhaps 17s. 6d. a week is made. Then no doubt the Government will again begin to panic and will say that something ought to be done. We say to the Government that the first thing that any government with a full sense of its responsibilities would accept the offer of the States Premiers to hand over to it authority to control prices.

Mr Bowden:

– .Only some of the State Premiers made that offer.


– All of them made it.

Mr Bowden:

– The Premier of South Australia did not make it.


– Nobody has claimed that prices control would be completely effective, but it is the first immediately practical step that any government ought to take. All the State governments are willing to hand over to the Commonwealth power to control prices, if not permanently, for a limited period of time. The honorable member for Gippsland (Mr. Bowden) perhaps knows the minds of the Premiers better .than they know their own.

Mr Bowden:

– South Australia did not offer to hand over prices control.


– All the States have said at one time or another that they are willing to transfer prices control powers to the Commonwealth. As a matter of fact the Ministers in charge of prices in the various States returned to their States from one conference, about twelve months ago or slightly less, with a decision to recommend to their governments that the Prime Minister be approached and asked that the Commonwealth take over prices control. But the Government is adamant and will not accept powers to control prices. The Treasurer (Sir Arthur Fadden) has said that prices control is only a means of recording increases of prices.


– Order! The stranger who has entered the House must withdraw behind the barrier. Strangers must not come in here.


– If the organization to control prices that exists .to-day and is to cost us £819,000 this year, is, as the Treasurer has said, only an agency to reflect and record price increases that have already taken place, then that sum of £819,000 is just being poured out of the Government’s overflowing coffers in an effort to bolster a recording machine. I presume that the view which the Treasurer expressed is also the view of the Prime Minister. We disagree with that view. Other countries have effectively faced the problem of prices control. The Government has a responsibility, first, to handle, more sensibly than it has done so far, the ordinary financial dealings of the nation. It must face that responsibility. Secondly, it must hand over office at some stage, we believe fairly soon, to another government. It therefore has a heavy responsibility to the incoming Government as well as to posterity. It cannot just sit idly by and see Commonwealth loans fail at a time of unprecedented savings bank deposits in both government and trading banks. It cannot claim with pride that the Australian people have more money in their bank accounts than ever before and then aver that in order to get the people to invest in Commonwealth loans the interest rate must be raised, and the interest charged by banks to borrowers who are home-owners and business men must be increased. The Government’s economic adviser, the “shadow cabinet” as he is assumed widely to be, Professor Copland, says that we ought to raise .the interest rate still higher in order to attract more money to Commonwealth loans.. The recent statements of Professor Copland have often been quoted. I shall now quote him in a different setting. Although he says today that, despite the fact that there are greater savings bank deposits than ever before in the names of Australian citizens, the interest rate ought to be higher to attract low interest-bearing deposits to Commonwealth loans, in 1932 he said, in a memorandum to the Prime Minister of the day -

The increase in bank deposits .provides a basis for a reduction of interest rates-

He made that statement to the government of the day in a time of depression. Yet in the present era of unprecedented bank deposits in both government and private trading banks, he says that interest rates ought to be raised. The Government, either deliberately following his advice, or acting on pressure from its own supporters outside, or, perhaps, because it cannot handle efficiently the finances of this country is raising the interest rate. That action is unwise. It is imposing a very great’ burden on all the people and is inflicting heavy losses on those who hold Commonwealth securities. It is also in direct conflict with the advice that was given by Professor Copland when he addressed a memorandum to the government of the day in the dangerous, desperate and difficult years of the depression. We say that before the Government is granted Supply it should put the affairs of this country in order. It should take a grip on the economic situation that confronts Australia to-day, and should have some regard for the hardships caused by increasing inflation, and should not merely think of doing something when prices, and consequently the basic wage, have already risen. It should certainly not defer action for eleven or twelve weeks until the basic wage has risen.

The lights in the chamber having become dim,


– The lights are going out.


– They will go out forever if this Government remains for long on the treasury bench. Every time we mention this matter in the House some members of the Government ask us whether we believe in wage-pegging. Wage-pegging is not involved in this simple issue that faces the Government and the people. Prices rise every day and the rises are computed and reflected in the quarterly basic wage adjustment. The rise that then occurs in the basic wage is in respect of price increases that have already taken place. If wages, marginal rates, allowances for certain special conditions, or other special allowances were pegged, the wage would have to rise if the cost of living continued to increase. As I have said, the quarterly adjustment of the basic wage reflects increases of prices that have taken place during the previous quarterly period, but the increases of prices generally that have taken place during that period amount to more than the increase shown in the basic wage adjustment. The reason for that is that the adjustment is made in accordance with the rise of prices of the relatively small number of items which constitute the “ C ‘ series index. The assumption is that the cost of the items that are regularly consumed by the community, whether they he absolute necessities or items that we formerly regarded as luxuries but which have moved into the category of necessities, will move in the same direction as the index. That is not true to-day. It is admitted that the prices of the commodities that constitute the index are rising but not so far as are the prices of other goods that are not included in the index. So the adjustments made to the basic wage fall short of the everincreasing cost of living, to the detriment of the great bulk of the Australian people.


– Order ! The honorable member’s time has expired.

Vice-President of the Executive Council and Minister for Defence Production · WENTWORTH, NEW SOUTH WALES · UAP; LP from 1944

– I have found it interesting to listen to the arguments that have been advanced by the honorable member for Melbourne (Mr. Calwell) and the honorable member for Perth (Mr. Tom Burke) relative to this Supply measure. However, the Treasurer (Sir Arthur Fadden) made it perfectly clear when he introduced the bill that it was for a specific purposes, which he stated quite clearly. Honorable members opposite decided not to approach this as a purely machinery measure but to make an issue of it in order to ventilate certain matters. I shall meet them on their own ground.

Let us examine some of the points that have been made by honorable gentlemen opposite and see whether there is any justification for their statements. For example, the honorable member for Melbourne began his speech with an impassioned appeal to the Government. I expected him to make a moderate kind of approach to the subject, because he spoke in rather muted tones when he suggested that I might have something to say to the Government with regard to the need for the introduction of a bill for the ratification of the Japanese peace treaty. As he warmed up to his subject, however, his voice reached crescendo when he said that the Government is afraid to introduce that bill. He made a similar statement in regard to the joint wool organization. I cannot understand this complex that the honorable member has” developed about the alleged fear of the Government to introduce bills, because everything that the Government has done so far has shown that it has great courage. I remind the honorable member that the Government went to the people after it had been in office for just over a year, and staked its future on the people’s vote. I have yet to see a Labour government have the courage to go to the people before its full term of office has expired. The Government has introduced a budget which is of a nature that is very essential for the times through which we are passing. The introduction of such a budget required great courage, because it was obvious that it would make the Government unpopular until its full benefits were realized by the community. So do not let us hear any more about the Government being afraid to introduce a bill for the ratification of the Japanese peace treaty. The honorable member for Melbourne’s argument about the attitude of the Australian community to that treaty is wide of the mark. He has over-estimated any popular opposition to it. In due course the Government will introduce a bill for the ratification of the treaty. It is obliged by the Constitution to do so. “We shall see then what the honorable member for Melbourne will have to say about it, and also about the legislation to be introduced in respect of the joint organization scheme. The honorable gentleman must not become impatient about these matters. About 26 bills, a budget and the Estimates have been introduced. I suggest that that is more than the honorable member is’ capable of dealing with at the moment. In fact his speech showed him to be suffering from a form of mental, indigestion. I have no doubt” that that condition will become considerably worse. He will find that the measure associated with the Joint Organization accounts will come before the House in due course and I have no doubt that it will give complete satisfaction to those who. receive- some, benefit, under the act.

T now come- to a matter to which a subtle political, twist was given by the honorable gentleman. After having stated a case by reading a letter from the Secretary to the Treasury, the honorable gentleman endeavoured to convey an impression entirely different from that which the letter intended to convey. He made some observations concerning the need for holding the Australian Loan Council in open session and not in camera. Perhaps he can recall the statement of an honorable member that he was very glad to have been present at a secret sitting of the Parliament because he would be able to tell his constituents something about the subject discussed at it. I have no doubt that a similar incident could occur in connexion with a meeting of the Loan Council. It is necessary that secrecy shall be associated with the deliberations of representatives of the States and the Commonwealth on financial policy. The letter which the honorable gentleman read made it clear to him that the Loan Council had decided what should be the total sum to be distributed among the States and that it had no knowledge of the particular purposes to which each State would put its share of the total. The Loan Council has no knowledge of the housing programmes of the various States. The honorable gentleman must have been aware of that fact, because it was set out in a part of the letter that he read to the House. In doing so he made a slip, because the information destroyed his argument. Now he has complained of what the Australian Government has done to the State governments, and has stated that he received his information from the Premiers of Queens^ land, New South “Wales and Victoria. He inf ormed the House that the Queensland Government had a programme for the construction of houses to the value of about £5,000,000 but that the Loan Council would make available only £4,000j000. He said that New South “Wales had a housing programme involving the expenditure of £14,000,000 and that the Loan Council would make available only £8,000,000.

The honorable member knows that the State Premiers could, have discharged their obligations with regard to housing by making available the full £5,000,000 in the case of Queensland, the full £14^000,000. in the case of New South

Wales, and the full £16,000,000 in the case of Victoria. The Loan Council did not restrict the States housing programmes but merely’ decided that the total amount of loan money to be raised should be reduced from the £300,000,000 originally proposed, to £225,000,000. The Premier of Victoria was most satisfied with the result of the reduction that had been effected. From the loan moneys allocated to his State he could have made £16,000,000 available for housing had he considered that housing was the most important part of his programme. When the honorable member for Melbourne, having produced a letter which stated the facts quite clearly sought to conceal those facts and to establish a case that was contrary to them he demonstrated the lengths to which the Opposition will go in order to attack the Government. The honorable member’s action was characteristic of the misrepresentation that has been practised ever since this Government was elected to office. The honorable member said that the Australian Government restricted the amount of money that was made available to the States by the Loan Council. That is not correct. The Premiers themselves, as members of the Loan Council, restricted their own programmes. They agreed to reduce their demands. The Australian Government informed them that they could, if they so wished, endeavour to raise on the loan market the total amount requested but that, in the light of previous experience, it was likely that they would be able to borrow less than £150,000,000. Contrary to precedent, the Australian Government offered to guarantee loans to a total amount of £225,000,000 if the total amount to be raised were limited to that figure; what could not be raised on the loan market the Australian Government would make available from its surplus revenue. If the Australian Government had not agreed to guarantee that sum the States would not have been able to obtain £225,000,000.

The honorable member for Melbourne suggested that, in this period of spiralling inflation, the Government should put money into circulation, by the issue of treasury-bills, equal to the difference between £150,000,000 and £300,000,000. Under that proposal, £150,000,000 would have been fed into our already overgorged financial system. Can the honorable member justify that proposal? Of course he cannot. Every nation that is suffering from an inflationary spiral is endeavouring to withdraw from circulation money that is not vital to the maintenance of the community’s essential industries. Yet this irresponsible honorable member would have more money in circulation. In what other way could the Government have found the difference between £150,000,000 and £300,000,000? Only, by increasing taxation. This ordinary financial policy has been propounded by an opposition party which, when it occupied the Government benches, had a? it financial adviser Professor Copland. He is not a financial adviser to the Menzies Government, but I believe that every word he utters is designed to benefit this country. Opposition members prate of the great financial policy that wa? followed by the Curtin and Chifley Governments. I remind them that Professor Copland was the economic adviser to those Governments and that to him must go tincredit, if there is any credit, for the financial policy of which they pretend to be so proud. Now that Professor Copland is not “ on side “ with the Labour movement, Opposition members seek to tear and rend him. They are trying to destroy his reputation. They treat him with contumely and abuse, as they have treated others who have advised their governments in the past.

Now that I have answered the honorable member for Melbourne effectively, I think he is sorry that he introduced the subject of loans. I shall, therefore, proceed to deal with the matter of Watsonia camp. This afternoon the Minister for the Army (Mr. Francis) read the contract between the Government-


– Order-! I have already ruled that there can be no reference to what the Minister said this afternoon.


– Honorable members know that a contract was drawn up between the Australian Government and the Victorian Government in which the Victorian Government agreed to vacate Watsonia camp at a given date. It allowed civilians to occupy the camp. If the Victorian Government is not capable of solving its own housing problems I do not mind its using Commonwealth military camps for that purpose when they are not needed by the Army. I know that the Government of Victoria is entirely incapable of administering that State, and if the Australian Government can help it must do so; and it did so by signing this contract. But if the members of the Victorian Government are men of honour they will fulfil their obligations. The Australian Government requires Watsonia camp for military purposes. The honorable member for Melbourne said that Australia was not on the verge of war, but the fact is that the Government must train men for the defence of this country. The matter is one not of war but of defence. The Government cannot train men for defence in the scrub-lands or out in the mallee. It has to train them in camps where they can be concentrated, where discipline can be enforced and where they can be given the necessary tactical studies. Consequently the use of “Watsonia camp by the Army is essential. The Australian Government asked the Government of Victoria to honour the obligation into which it had solemnly entered to vacate Watsonia Camp. Apparently it had signed the lease with its tongue in its cheek; that it never had any intention of withdrawing from the camp those whom it had placed in it, and is now trying to “ stand up “ the Australian Government. It is endeavouring to profit from the situation and is indulging in the lowest form of trading in the political world. When the honorable member for Melbourne realizes that to be a fact, I think that he will feel completely ashamed of himself, because I regard him as a man of some honour.

I shall direct the attention of the Prime Minister (Mr. Menzies) to the matter that was raised by the honorable member for Warringah (Mr. Bland) relative to the establishment of the committee which he has envisaged for the purpose of exercising control over the parliamentary purse.

I shall now refer to the remarks that were made by the honorable member for Perth in criticism of the Government’s financial policy. He thought that he could successfully criticize the Government’s action in relation to Amalgamated Wireless (Australasia) Limited. When the Government entered into a contract with Amalgamated Wireless (Australasia) Limited it did so because of a national obligation. The operation of telecommunications services on a national basis was a most important factor which brought the Government into association with Amalgamated Wireless (Australasia) Limited. The need for the continuance of that association has now gone. Telecommunications are no longer associated with Amalgamated Wireless (Australasia) Limited, which makes valves and radio sets. Does the honorable member consider it to be a function of the Government to compete with private enterprise in the manufacture of such items as radio valves? Would he have the Government participate in the manufacture of talcum powder and babies’ bottles? The honorable member probably intended originally to attack the Government for having sold Amalgamated Wireless (Australasia) Limited shares at too low a figure. But when he found that the value of the shares had dropped on the stock exchange it was made quite clear to him that the Government had obtained a very reasonable price for the shares and he had to look for a new line of attack. It has taken him so long to develop that attack that it has come only at this late hour when the whole matter has been completely forgotten by everybody except himself. Of what value are the Opposition’s argument’s about such matters when they have waited until the whole episode has been forgotten before they have condemned the actions of the Government?

The honorable member then dealt with interest rates. He and other honorable members have shown a complete lack of knowledge of the factors involved in the various matters dealt with by- the .-Loan Council. Surely he knows that interest rates are fixed not by this Government but by the Loan Council. …

Mr Tom Burke:

– This Government dominates the Loan Council.


– In the Loan Council this Government can exercise two votes only. When the works programme was being discussed by the Loan Council, the Government was completely outvoted by the States.

Mr Tom Burke:

– But-


– Order ! The honorable member for Perth (Mr. Tom Burke) has already been heard.


– The Commonwealth can exercise only two votes against six votes which may be exercised by the States. Therefore the Commonwealth can certainly not dominate the Loan Council. The Loan Council fixes rates of interest. The honorable member for Melbourne said that a deliberate attempt had been made by the Australian Government to hamstring the Victorian Government. I informed him that the Premier of Victoria was one of those who had decided the rate of interest to be charged.

Mr Tom Burke:

– Under duress.


– That is a lot of nonsense. It is surely nonsense to say that, because at some Loan Council meetings the States have ganged up against the Commonwealth. The Victorian Premier was agreeable to the rate of interest ultimately fixed. The honorable member spoke of the treatment of Government instrumentalities in Victoria, such as the State Electricity Commission. If the Victorian Government has not such a close liaison with its own State Electricity Commission that it can make money available to it at a rate determined by itself, then it displays a poor business sense. I cannot understand the Opposition’s argument at all.

Thehonorable member spoke with some heatabout the Premiers Conference being held in January. We called the Premiers together in January because we did not want later to be in the position of having guaranteed money to the States in excess of what the loan market would carry.

Mr Tom Burke:

– The Government called the Premiers together to indicate its strength.


– The Government did not intend subsequently to have to finance works out of revenue. The honorable member must know that it is an established financial principle that works must not be . financed out of revenue. On this occasion, in order that the Premiers would not have entered into commitments, and toprevent com plete chaos in the States because of advance commitments, we decided to underwrite the loans raised by the States. However, we intend to see that no commitments shall be made in advance in the future, and that we all shall cut our coats according to the cloth available. In a time of rising prices surelythat is a sound financial principle. No argument that the honorable member may advance will alter the Government’s method of handling this matter.

The honorable member told us that it was of no use to peg wages as an antiinflation measure, because the basic wage increases will not allow wage-pegging to become effective. That was certainly not the opinion held by the late Mr. Chifley when he supported a system of wage-pegging. That gentleman knew that the onlyway in which prices can be effectively controlled is by pegging wages. Wages are by far the greatest element in the cost of goods, and unless they are kept down commodity prices must rise. The cost of an article cannot be pushed to the ceiling “while the selling price is pegged below the ceiling. If an attempt were made to do that, private enterprise would not last very long. Such a line of argument is a Socialist thesis designed to smash private enterprise and to replace it with government control. That is the pure Socialist theory of industry. If the honorable member knows anything at all about economics he must know that wages are the most important factor in cost and that unless cost reflects a return to the producer industry will not carry on. When he says that the Government should fix costs but not wages I say that his suggestion is completely impracticable, particularly in the light of the last Labour Government’swage-pegging activities. The proof of the pudding is in the eating. When there was Commonwealth control of prices, side by side with that control there was a system of wagepegging.

I hope that this billwill have a hasty passage through the House, because Supply is necessary for the carrying on of the affairs of government. I know that in view of the great sincerity displayed by honorable members opposite in the discharge of their duties, they will agree that this measure is necessary.

Question resolved in the affirmative.

Bill read a second time, and reported from committee without amendment or debate; report adopted.

Bill- - &y leave - read a third time.

page 1101


Second Reading

Debate resumed from the 26th September (vide page US), on motion by Sir Arthur Fadden -

That the bill be now read a second time.


.- This measure is complementary to the one that the House has just dealt with, and it envisages the expenditure of £28,031,000 on Additions, New Works and Other Services involving Capital Expenditure. Upon examination it will be found that it is not strictly a provision for the expenditure of money for the purposes indicated during only two months, because the bill mentions a sum of £12,500,000 in respect of war service homes, which represents half the estimated requirements for 1951-52. That sum is therefore three times the amount that would have been provided for had the measure been strictly designed to cover expenditure for the two months from the end of October to the end of December.

The bill provides for the expenditure of £6,020,000 in the Postal Department. I inform the Postmaster-General (Mr. Anthony) that when the Estimates are under consideration we shall seek details of the schemes of the Government in regard to post office extensions and the works that have been suspended? The Treasurer said in his second-reading speech -

I might mention here, as 1 did in my budget speech, that the Government has given the closest scrutiny to all works programmes, and has made heavy reductions on the original departmental proposals to ensure that there will be no undue competition for scarce labour and materials’.

If there is a scarcity of labour, the Government should set about repairing the deficiency. Perhaps it could consider bringing to this country single people “ instead of families. Obviously, each single person is a producing unit and doe’s not require accommodation ‘for ‘a family, whereas in a family of five units there is only one breadwinner, but accommodation is required for five persons.

It has been proposed that £3,164,000 shall be expended through the Department of National Development, mainly on the Joint Coal Board and the Snowy Mountains hydro-electric scheme. Single people could be brought to Australia to work on the Snowy Mountains scheme and any

Other national scheme and also on State works. The delay in completing national works is slowing up development, causing shortages and bottlenecks, and generally having a harmful effect on our economy. Immigration can promote inflationary trends, but by its contribution to the work force can have greater deflationary effects. Selected immigration will certainly have a deflationary effect. Perhaps the VicePresident of the Executive Council (Mr. Eric J. Harrison) could ask the Minister for Immigration (Mr. Holt) to give to us, when the budget is being discussed, some details of what is to be done in regard to the types of immigrants to be brought here.

There is a proposal to expend £1,500,000 on civil aviation. We have heard that works programmes at certain airports have been curtailed. Mascot, in New South Wales, Mentone, in Victoria, and an air-field near Glenelg, in South Australia, have all had their works programmes curtailed. We should be expending as much as we can on aviation because of Australia’s geographical features. Aviation is the most important transport service in- many isolated areas.

The proposed vote for the Department of Works and Housing is £381,000. I ask the Vice-President of the Executive Council to request the Minister for Air (Mr. McMahon) to give some consideration to the extension of Point Cook air training station so that it will not be necessary to dismiss 70 per cent, of the civilian clerical staff which the press announced yesterday was the Government’s intention. All those men Who are ex-servicemen have been told that their jobs have gone and, at the same time, that they will have’ to vacate the houses that they occupy. I ask the Government to extend its building programme at

Point Cook in order to obviate their losing either their jobs or their accommodation. At present it is difficult for any one to find accommodation anywhere in Australia; and the position is particularly hard for men who believed that as they were employed at a Services establishment they would have not only security of employment but security of accommodation as well.

The Opposition does not oppose the measure. The proposed expenditure is not excessive. We believe that the Treasurer has applied the pruning knife too heavily. When he said that he was making heavy reductions he was, in our view, speaking euphemistically. He has made slashing reductions that cannot be justified if we are to develop this country and provide for the community’s needs. In view of the reduction of the expenditure of the Postal Department, I do not know how people who are in urgent need of telephones will obtain them. I recall that when the Vice-President of the Executive Council was Deputy Leader of the Opposition, he demanded statements almost weekly of the number of applications that had been lodged for telephones and of the number of claims that were outstanding against the various departments in respect of services rendered to them. Now that he is Deputy Leader of the Liberal party and Leader of the House, he must give effect to the protestation that he made when he was in Opposition. He must not try to escape from the responsibilities that rest squarely on his shoulders. He must discharge those responsibilities between now and the date of the next general election, because if he fails to do so he will contribute still more to the Government’s inevitable doom.

Vice-President of the Executive Council and Minister for Defence Production · WENTWORTH, NEW SOUTH WALES · UAP; LP from 1944

– I regret that the honorable member for Melbourne (Mr. Calwell) ruined a temperate and restrained speech by pointing the bone at me. However, I shall return good for evil. I shall say nothing about what possibilities for preferment honorable gentlemen may have at the next general election or with respect to leadership of the Opposition.

As the honorable member was an eminent and capable Minister for Immigration in the Chifley Government, no one would know better than he does that a big problem confronts the Government in maintaining a balance between British and European immigrants. Today, we cannot get single British immigrants because the British Government will not release single men. It is equally true that we shall insist upon accepting only ‘ single immigrants from European countries with the exception of Holland, from which we are taking family units. I do not think that the honorable member would suggest that we should severely restrict the immigration of British families and concentrate exclusively on single European immigrants. We must maintain a balance between those classes of immigrants. I should not be opposed to Australia taking great numbers of immigrants from northern Italy, the Scandinavian countries and Holland or, indeed, German settlers, because I believe that they make first-class settlers in comparison with immigrant? from less-favoured countries. That is my personal opinion. However, the Minister for Immigration (Mr. Holt) is aware of all the problems involved. It is perfectly true that whilst a single immigrant and a married immigrant may be equal on the basis of man-hour production, at the same time, a single immigrant does not make so great a call upon our resources as a family unit does. Similarly, whilst the immigration of family units tends to inflate the economy, the entry of single immigrants has a deflationary effect. The Government must weigh that problem carefully.

The honorable member for Melbourne has a strong tendency to try to dictate what government policy should be. That was apparent from the remarks that he made with respect to civil aviation. I do not object to that attitude on his part. He can make whatever suggestions he wishes to make, and I assure him that the Government will consider them before it consigns them to the wastepaper basket. However, he does not know the first thing about the Liberal party’s policy. I shall direct the attention of the Minister for Air (Mr. McMahon) to what the honorable member has said about the dismissals of staff at Point Cook. Those dismissals are being effected in accordance with the Government’s general policy. The Government does not intervene in individual cases. It merely gives general directions that tie in with measures that are designed to check inflation. All I can say to the honorable member is that of the suggestions he has made those which have any substance whatever will be considered by the appropriate Ministers.

Question resolved in the affirmative.

Bill read a second time, and reported from committee without amendment or debate; report adopted.

Bill - by leave - read a third time.

page 1103


Assent reported.

page 1103


BUDGET 1951-52

In Committee of Supply: Consideration resumed from the 23rd October (vide page 1021), on motion by Sir Arthur Fadden -

That the first item in the Estimates, under Division No. ] - The Senate - namely, “ Salaries and allowances, £16,400 “, be agreed to.

Upon which Dr. Evatt had moved, by way of amendment -

That the first item be reduced by fi.

Darling Downs

– Judging by the remarks that the Leader of the Opposition (Dr. Evatt) made he does not consider that Commonwealth administrative expenditure should be reduced or that any reduction should be made of the States’ works programmes. At the same time, he advocated increased expenditure in respect of social services and went even so far as to indicate that he did not consider that the proposed expenditure on defence was sufficient. In effect, he submitted that the total expenditure proposed in the budget should be increased. He also made it clear that he did not consider it to be necessary that the Government should budget for a surplus. He advocated increased expenditure which would have to be covered by either increasing taxes or issuing .treasury-bills - that is, by using central bank credit. However, most of his colleagues protested against the government’s proposal to increase taxes. We must conclude, therefore, that in .their view even the expenditure that is being budgeted for should be financed by central bank credit to cover the deficit. Such a proposal is completely inflationary in character. Indeed, the Leader of the Opposition made out a case of inflation. Thus, he now appears as the champion of communism and inflation, which are two of the greatest evils that confront Australia to-day.

The honorable member for Port Adelaide (Mr. Thompson) referred to the decline in value of Commonwealth bonds and charged the Government with being responsible for it. I point out that the raising of Commonwealth loans is the responsibility of the Loan Council, which consists of one representative of each State with the Commonwealth Treasurer as chairman, in which capacity he has a casting vote in addition to a deliberative vote. Consequently, the Australian Government’s representative on the Loan Council has only two votes compared with six votes by the States and, therefore, any decision of the Loan Council must be the responsibility not of the Australian Government, but of the council itself.

It is appropriate to examine the background against which the budget has been introduced. We must look ait the world economic situation and see how it has affected Australia during the last few years. Every honorable member will agree that the Western democratic powers have been experiencing inflationary trends. The inflationary tendency is world-wide and Australia has felt its effects, but there are also substantial inflationary pressures. Those pressures have been caused by an unbalanced money demand for goods and resources and have been in short supply. Therefore, these two matters constitute the first factor for consideration when we are examining the background to this budget. This internal inflationary pressure has obviously led to competition and high prices on the open market in Australia, and, in many instances, to a keen demand by government instrumentalities for materials that are required for public facilities and developmental projects, in competition with private industry. Such competition has- produced additional inflationary pressure.

The rapid expansion of industry after the relaxation of war-time controls, when the Australian market was still protected against competition because of shortages of goods- overseas, the increasing demand for goods and services, and the great volume of purchasing power within Australia, constitute another inflationary factor that must be considered as a background to this budget. Competition has developed since the war between the light and the heavy industries for man-power and capital equipment, and that competition, in turn, has increased labour costs as well as capital expenditure. A variety of reasons may be offered for that competition, but it will be admitted that the basic heavy industries have suffered in the contest with the light industries and are feeling the effect of the shortages of essential materials. That is one reason for the reduced output from heavy industries. It is only within the last twelve months that the influence of the flow of imported goods has commenced to re-assert itself on the Australian economy. The serious shortage of plant and equipment in the heavy industries and the light industries alike is reflected in shortages in the local market.

Since the end of the last war there ha3 been a rapid expansion of public works and public facilities such as power, water, transport, housing and education, which are principally controlled by the Government and are competing with private enterprise on a market that is short of goods due to the lack of imports, basic materials and essential plant for maintaining industry on a proper productive basis. Coupled with those factors, there has been a tremendous increase of the defence production, and at the same time, a greatly increased income from our exports. All those factors must be considered when we are examining the background of the present budget. I believe that it will be agreed that all those factors have a- definite inflationary effect, and cause internal inflationary pressures which, when taken with the pressure of inflationary trends overseas, have brought about an economic condition that has rendered it necessary for the Treasurer (Sir’ Arthur Fadden), to introduce this budget. The Government was faced with an inflationary situation, and, having made a complete examination of all the factors, considered that the best way in which it could deal with the problem was by financial measures.

Before the budget was presented to the Parliament, certain other financial measures had been taken, such as the control of bank credit, the new policy governing bank advances, and the reintroduction of the control of capital issues. The purpose of all those measures, which were of an intermediate kind, was to deal with the inflationary situation. The wisdom of the policy of the Government to meet the inflationary conditions by financial measures was confirmed by the economic conference that was convened by the Prime Minister (Mr. Menzies) in Sydney a few months ago for the purpose of enabling the Government to sense the opinions of various groups in the community about the best methods that could be adopted to combat inflation. The measures which had already been introduced were confirmed by the opinions of delegates who attended that conference. They made it clear that, in their opinion, the best method of dealing with the inflationary situation was not by physical controls such as prices control, rationing and the direction of labour, but by financial correctives. Even if some delegates were in favour of the physical measures, the Commonwealth did not have the constitutional powers to implement them. The conference also approved most heartily of the Government’s immigration policy, defence programme, and proposals for the maintenance and improvement of social services.

This budget, for the very reason that it proposes to combat inflation, may be termed a stability budget. It is an antiinflationary budget, and the proposals of the Treasurer include certain particular measures that I shall proceed to summarize. First, the budget proposals are a dis-incentive to non-essential production. Secondly, they place a restraint on Commonwealth expenditure on works. Thirdly, they envisage- a reduction of the strength of the Public Service, in accordance with the Government’s policy. Incidentally, I mention that the retrenchment of some public servants has aroused a considerable volume of adverse criticism in this Parliament. Fourthly, they involve the acceptance of a policy that had been pursued, strange to say, by the Chifley Government. The basis of that policy is that in a period of rising incomes, it is less inflationary to pay for essential works out of revenue than to compete on the loan market, or to utilize central bank credit. That policy, which was laid down clearly by the Chifley Government, may be considered wise in the present circumstances. Fifthly, the budget proposals involve the acceptance of the principle of payasyougo for defence expenditure unless or until the nation is engaged in a full-scale war. The purpose is. to prevent defence expenditure from accentuating the inflationary situation by ensuring that, year by year, the defence programme shall be paid for out of revenue rather than by the use of central bank credit.. Sixthly, the budget contemplates the strengthening of reserves against a possible fall in the national income. I shall deal more fully with that point later in my speech. Opposition members would have extreme difficulty in disputing several of those proposals, because they were advocated by the former leader of the Labour party, the late Mr. J. B. Chifley.

The circumstances, have been recognized by certain authorities in Australia outside the parliamentary institution, and, in fact, the Governor of the Commonwealth Bank stated in a report recently -

We have .built up a volume of imports which we are unlikely to be able to sustain over a long period from our resources. Levels of costs are being established which will expose Australian industries to acute competition when the present excessive demand conditions pass. Efficiency in all sectors of industry has been seriously impaired by the high rate of labour turnover and delays in production which have resulted from attempts to spread available resources over too many projects. It is essential that both public and private investment should be reduced to a level more appropriate to, the volume of resources available.

Before I summarize some of those points, I shall mention the principal commitments of the Treasurer that are essential and irreducible. Some of the figures that appear in the following table have been consolidated and include, various groups : -

When we analyse those figures, we must admit that any attempt to finance the irreducible commitments on the basis of revenue last year would compel the Treasurer to budget for a deficit of £50,000,000, or, alternatively, utilize bank credit - which, as I have explained, would have an inflationary effect. The only alternative to budgeting for a deficit is to increase taxation. This budget provides for substantial reserves, which will have a definite deflationary value and will also be available, as the need arises, to reduce the public debt or to underwrite State public works programmes.

Professor Prest, of the University of Melbourne, dealt intelligently with the subject of budget surpluses in a recent report, from which I quote the following extract : -

Budgeting for a surplus of tax receipts over expenditure is necessary to pay for public works that cannot be met out of loans this year.

Its final use depends on what subscriptions there are to Government loans. If every loan is under-subscribed the Governments are going to. be very short of money.

This is not a case of the Commonwealth building up a surplus to deprive the States of funds, but just the reverse. They are building it up to provide the States: with funds to carry out their public works.

Reference has been, made during this debate to statements that were made in the Victorian Parliament by the Premier of Victoria, Mr. McDonald, concerning the- reduction of State public works. The simple fact is that allocations to the States are made by the Loan Council, not by the Australian Government, as members of the Opposition have said. Victoria has a vote at meetings of the Loan

Council, as has every other State, and the council decided last August to reduce grants to the States by 25 per cent. I emphasize the fact that this decision was made with the support of the Premier of Victoria. Even so, the amount of approximately £225,000,000 allocated to all States represented an increase of approximately 36 per cent, over the allocation for the previous year. In 1950-51, Victoria was granted a total of approximately £36,000,000. This year it will receive about £56,000,000, which represents 24.8 per cent, of the total amount of the allocations to the States. Incidentally, allocations to the States from revenue and loan funds have increased by 60 per cent, since 1949-50.

A comparison of this Government’s budgetary proposals with the policies of overseas governments provides us with interesting information. The United Kingdom budget for the current year provides for a substantial surplus. The Attlee Labour Government is tackling inflation by budgetary means. Only three courses of action were open to the Government when it decided on the policy of combating inflation by that method. First, it could impose purely Socialist’ controls, such as prices control, which would involve a larger bureaucracy, increased subsidies and, eventually, a larger budget commitment. Secondly, it could impose strict financial corrective measures, which would not be effective unless they were vigorously applied. In fact, the Government has provided for the use of correctives of that kind under the terms of this budget. Thirdly, it could adopt the policy of allowing existing conditions to continue and bowing to the inevitability of the present boom being succeeded by a depression. Fortunately for Australia, the Government has accepted the responsibility of using budgetary means to deal with inflation.

Limitation of time will not permit me to make a carefully detailed analysis of the various aspects of the budget, but the broad fact is that it provides only for inescapable financial commitments. Notable amongst these is an amount of £183,000,000, which is to be devoted tn defence. This item represents an increase of £34,000,000 over the provision that was made last year. Preparation for the adequate defence of the nation is absolutely vital to us at this time. Our developmental and immigration programmes likewise are essential. A comparison of relative expenditure on defence by Australia, the United Kingdom and the United States of America should enlighten honorable members who have been critical of the Government’s defence proposals. The Australian Government proposes to expend 5.9 per cent, of its revenue on defence. The proportion of national revenue to be appropriated for defence in the United Kingdom is 9.9 per cent, and the figure for the United States of America is 8.2 per cent.

I believe that all honorable member? will agree that our immigration programme should not be curtailed. The amounts that have been earmarked for interest and sinking fund payments provide for the discharge of a national obligation. “We must provide for the repayment of loans and for interest charges. The proposed appropriation of £185,000,000 for the National “Welfare Fund this year represents an increase of £52,000,000 over the amount appropriated for that purpose last year. That increase will provide for a substantial increase of the rates of invalid, age and widows’ pensions and for certain alleviations of the means test. Any move for the abolition of the means test, incidentally, will have my full support. Repatriation benefits will cost an additional £7,300,000 this year. I cannot believe that any honorable member would object to that provision. The administrative cost for which the budget provides is only £40,300,000, compared with £37,300,000 last year. In a budget of approximately £1,000,000,000, that amount is not unreasonable. Australia’s contribution to relief in Asia under the Colombo plan will be £9,000,000, and I believe that nobody will object to that provision. Thus, when we examine the Government’s proposals closely, we must agree that, although the budget provides for a record expenditure, the commitments involved are wholly inescapable. The only real solution is to budget for a surplus, which will have a deflationary effect, and to obtain additional revenue by means of substantially increased taxation. Everybody must acknowledge, surely, that the taxation proposals for a 10 per cent, increase of income tax, a modification of the averaging system, an increase of company taxes, and increases of the sales tax and of customs and excise duties, are unavoidable in the circumstances. Whilst there would be grounds for objection to these proposals in normal circumstances, [ consider that we have the duty of supporting the budget as it stands.

Sitting suspended from 5.5k to 8 p.m.

Minister for the Army · Moreton · LP

, - The amendment that has been moved by the Leader of the Opposition (Dr. Evatt) is, in effect, a motion of want of confidence in the Government. This is the strangest debate upon an issue of that kind that I have ever heard in the Parliament. An Opposition, having proposed a motion expressing lack of confidence in the Government, usually shows its sincerity by refusing to deal with any business other than that motion. In the past, Opposition members have refused even to ask a question after such a motion has been proposed. On this occasion, the Opposition’s attack upon the Government is only make-believe. Honorable gentlemen opposite are shadow sparring. Their actions will deceive nobody. They have made the craziest possible approach to the matter.

Apparently the Opposition is gradually becoming convinced of the soundness of the principles upon which this budget is based. A careful analysis of the speeches that have been delivered by honorable gentlemen opposite shows that there are only two features of the Government’s financial proposals about which they appear to be concerned. They have suggested that increases of taxes are unnecessary, and they have said that more money should be paid to pensioners and other sections of the community. Throughout the debate, they have exhibited an inconsistency, the like of which I have never heard before in a debate of this nature.

I shall refer very briefly to some observations that were made by the honorable member for Adelaide (Mr. Chambers). As a former Minister for the Army, the honorable gentleman should know that the statements that he made last night were utterly incorrect. They were most unworthy of him, and should not have been made. He said that the Minister for Defence (Mr. McBride) was a Minister in a government which, in 1941, was considered to be so incompetent to conduct the war effort of this country that two of its own supporters deserted it and supported the Opposition. The honorable gentleman knows very well that the two men who withdrew their support of the Menzies Government in 1941 and voted with the Labour party were not members of the present Government parties, but were independents. They withdrew their support of the Menzies Government, not because they believed it to be incompetent to conduct the country’s war effort, but in anticipation of rewards which they received later. One of them was appointed chairman of Trans-Australia Airlines at a fabulously high rate of remuneration. To-day he is in political oblivion. The other has been the Administrator of Norfolk Island for a considerable time.

Let us remind honorable gentlemen opposite of some statements that were made by the late Mr. Curtin. Shortly after the right honorable gentleman had assumed the office of Prime Minister, he paid a glowing tribute to the work thai had been done by the previous government. Speaking in the Sydney Town Hall on the 12th October, 1941, he said-

I have to pay tribute to the government which preceded my own for the constructive work which it has done in defence and foi the foundations that it has laid.

Was that an indication of lack of confidence in the Menzies Government? Mr. Curtin paid an unqualified tribute to that government for the plans that it had made for the defence of this country. On the 18th October, 1941. he said thai when he came into office the Navy was at its highest pitch of efficiency, a fact that had been demonstrated by the notable exploits of its ships overseas. If that was the position, was the honorable member for Adelaide justified in saying that in 1941 the Menzies Government was considered to be incompetent to conduct the war effort of this country? Mr. Curtin said also that when his government assumed office the home defence army was well trained and its equipment had been greatly improved. He went on to say that the strength of the Royal Australian Air Force had been largely increased, in respect of both home defence squadrons and the training resources of the Empire Air Training Scheme, and that its equipment had been much improved. Having regard to that unqualified and unstinted tribute to the splendid work of the Menzies Government in strengthening the Royal Australian Air Force for the defence of this country, is there any justification for the allegations that have been made by the honorable member for Adelaide?

Mr. Curtin admitted that when he assumed office munitions production and the development of production capacity over a wide range, including aircraft, was growing weekly. The Minister for Defence, who was Minister for Supply in the Menzies Government in 1941, did a job of work then that will stand to his credit for as long as this Parliament exists. Starting from bedrock, he established munitions annexes in large factories; he brought together the leaders of industry in this country and organized them into a driving force that brought munitions production and secondary production for the armed forces to the highest possible degree of efficiency. The organization that was established by the Menzies Government was maintained in existence throughout the war, without alteration. Despite what was said by the honorable member for Adelaide, the Curtin Government built upon the foundations that were laid by the Menzies Government. It did not change any of the personnel engaged. I repudiate the allegation that the Menzies Government was thrown out of office in 1941 because it was considered to be incompetent to conduct the country’s war effort. It was thrown out of office because rewards were offered to the people who deserted it.

Throughout this debate, it has been demonstrated that the Opposition has no real objection to the basis of the budget. Its members have had a shot at a few of the outhouses, so to speak, in an attempt to conceal their own indecision. I say advisedly that they are beginning to accept the principles upon which the budget is based. The budget is designed to meet the crisis of a war emergency, to ensure the adequate defence of this coun- try and to enable us to discharge our obligations to the United Nations and our obligations under the Pacific Pact.

When the first budget was presented in this Parliament 50 years ago, the appropriation for defence purposes was £S61,000. To-day it is £183,000,000. It must be borne in mind that 50 years ago the defence preparations of this country were being initiated, and that a large proportion of the money then made available for defence purposes had to be expended upon constructional works. 3 am certain that the right honorable member for Bradfield (Mr. Hughes), who was a member of the Parliament at that time, did not realize that during the next 50 years this country would be engaged in two world wars and that the Government in power now, in addition to making provision to meet the cost of those wars, would be required to make provision for the adequate defence of Australia in hectic times such as those through which we are now passing. The substantial amount that will be raised for defence purposes this year is essential for the adequate defence of Australia and for the maintenance of the security of our people. The Government would be recreant to its trust if it did not make adequate defence preparations the supreme budgetary consideration!

Honorable gentlemen opposite have complained that the increased taxes that must be imposed to enable us to meet our obligations should be imposed, not upon this or that section of the community, but upon another section. They have complained also that the Government, having increased taxes, does not propose to make adequate payments to various sections of the community. Their attitude is very difficult to understand. Although they have said that the revenue to be raised this year will be more than the Government will need to discharge its obligations, they have argued that it will be inadequate to meet many of the claims that they believe should be met.

The budget is designed to meet an inflationary situation. Inflation is a world-wide problem. It is not one

With which Australia alone is faced. Both belligerents and non-belligerents in the last war, both victors and vanquished, are faced with inflation. Only a government that has the courage to attempt to solve that problem by means of an antiinflationary budget can help its people to emerge from the difficulties that are an aftermath of the war.

Mr Rosevear:

– It does not require courage to take money from a person’s pocket. The gaols are filled with people who have done that.


– Probably the honorable member for Dalley (Mr. Rosevear) knows more about gaols and taking money out of people’s pockets than does any honorable gentleman on this side of the chamber. If he is an expert upon those subjects, we can discuss them with him later. The increase of the consumption of goods in this country has proved that we have neither the man-power nor the materials that would enable us to meet the requirements of the moment. This Government, in the limited period during which it has been in office - and I remind honorable members that during that time there have been two general elections and a referendum campaign - has taken very definite budgetary and pre-budgetary action to meet that problem. By exercising control over bank credit policy and capital issues, it has imposed a check upon inflation that will, I believe, by the middle of next year at the latest, have a beneficial effect upon the national economy.

We have heard much about the public works programme. Everybody would like an almost unlimited number of public works to be undertaken, but the limiting factor is the availability of man-power, materials and funds. A public works programme must be trimmed to accord with the materials that are available and the money that can be obtained from the community by way of loans. That is being done by the Commonwealth in collaboration with the Loan Council. Not one of the proposals agreed to’ by the Loan Council had the assent of the State representatives as a result of coercion by the Commonwealth. Anybody who challenges what was done by the Loan Council is either not cognizant of the facts or is not speaking the truth. Plans have been made for the implementation of the biggest public works programme that this country has ever had. If the problem be tackled properly, and if the organization be on the lines that were indicated by the Prime Minister, solid progress will be made, and the qualms that have been expressed by honorable gentlemen opposite will be proved to be groundless.

Estimated expenditure this year is £926,800,000, compared with £94,400,000 for the year prior to the commencement of the second world war. Since 1939, war and repatriation commitments have increased from £27,317,000 to approximately £289,104,000. These commitments alone are more than double the whole of the budget in 1938-39. That fact indicates clearly some of the problems that the Government has to face. As a result of the last war, some of the obligations that it has to meet are more than double the demands of 1938-39.

Another major item is the amount of £184,785,000 for payments to the National Welfare Fund. That is an entirely new commitment which has come into existence since the end of World War II. Contributions to the States in 1938-39 amounted to £15,649,000, whereas the provision in the budget for that purpose is for an amount of £161,176,000, which 13 almost eleven times as great as the 1938-39 figure. It has been necessary to provide for an increase this year of almost £52,000,000 for expenditure on the three armed services. The appropriation for the Navy is to be increased by £10,000,000, which is to include provision for naval construction, buildings and works, and an expanded shipbuilding programme. Expenditure on the Army is expected to be £21,000,000 higher than it was last year. I hope to deal in fuller detail with that matter later. The programme for the air services, including maintenance of extra squadrons overseas, purchase and construction of aircraft, procurement of stores, and new works and buildings, will involve an increased expenditure of £21,000,000.

During the last year we have had a very hectic time in the international field. In that time there has been no relaxation of international tension, and Russia and its satellite nations have disturbed the world everywhere. Apart from that very crave situation, the British Commonwealth of Nations has had serious trouble in Persia and Egypt and, to a lesser degree, in Iraq. The recent assassinations of Sir Henry Gurney, British High Commissioner in the Federated Malay States, King Abdullah of Transjordan, and Liaquat Ali Khan, Prime Minister of Pakistan, indicate the disturbed state of the world and 3tress how essential it is for this country and the other peace-loving countries of the British Commonwealth and of the United Nations to make adequate preparations for their defence. The promise of peace in Korea has not yet been fulfilled, and negotiations for a cessation of hostilities there do not seem to be making much progress, although the position is perhaps slightly brighter to-day than it has been. We are dealing with a very tricky enemy in Korea and with an even trickier enemy which is supporting him. We have found it imperative to increase our contribution to the allied forces in Korea, and are forming a new battalion to give support to the wonderful work that has been done there by the Srd Royal Australian Battalion. The work of the 3rd Battalion has been second to none. It went into action carrying with it the very high traditions of the First and Second Australian Imperial Forces, and, indeed, it has lived up to the high reputation of Australian forces in two world wars. In my opinion, it has even outshone the splendid work that Australian forces did in those two wars. The fact that the 3rd Battalion has won the coveted presidential citation from President Truman for the wonderful work that it did in stemming the advance of the Communist forces on the night of the 26th-27th April last, is a fine commendation of its excellence. That exploit waa one of the finest that any fighting force has ever accomplished.

I agree with the Prime Minister that war is not inevitable. If we show the bully that we and all the other nations of the British Commonwealth and the United Nations arc adequately prepared for the defence of our liberties, war may be averted. I can assure honorable members that if, indeed, we arn moving towards a state of grave emergency, the Army has never before been in a better condition or more able to meet the consequential and vital need for ready expansion than it is in to-day.. I believe that the Army is now better prepared, has a higher morale, is a more efficient fighting force and is better led than it has been in any time of peace since federation. I make that observation not idly, but as one who has been a close observer of the development of the Army for many years. I took my first interest in it in 1911, and I have made a close study of its development ever since. I am convinced that to-day we are singularly fortunate in having an Army second to none that we have had previously in peace-time. However, I agree with the Minister for Defence that we still have a long way to go before we can be satisfied that we are anywhere near to being adequately prepared.

Mr Curtin:

– The honorable member for Franklin (Mr. Falkinder) did not say that.


– I am speaking of the Army, and the honorable member for Franklin (Mr. Falkinder) spoke about the Air Force. If the honorable member for Watson (Mr. Curtin) would sit back, listen more and talk less he would be better informed. The Army to-day is trying to build up two mixed brigade groups of more than 12,000 men. The field forces are to be required to be prepared to serve anywhere in the world, according to operational needs. Garrison forces in Australia are necessary for the defence of Australian territory against raids, and for internal security tasks including the protection of vulnerable points of military significance. The Army’s role also requires a command, training and maintenance organization for the support of those forces and also to ensure co-operation with British or Allied forces that might be based on Australia. The organization of our field forces in peace-time has been moving regularly forward. We now have the Australian Regular Army composed of two battalions, the Citizen Military Forces and the National Service trainees. I believe that in a very short space of time we shall have a third battalion in operation, because we have 1,400 or 1,500 recruits in training. I hope that we shall be able to draw substantially from the National Service trainees to build up our regular forces.

The Citizen Military Forces now have a personnel of about 21,000. That force is rapidly being developed so that it can also, if required, serve anywhere in the world. Its members have also voluntarily enlisted for service in any theatre of war.

If time permitted I should tell the House in detail of the wonderful exploits of the National Service organization, the work of which was fraught with the possibility of great difficulty. When we launched a scheme of compulsory military training some years ago there was an unfortunate antagonism against it; the community was not co-operative and we had a very sad and sorry time in endeavouring to develop the system. These attempts were killed at birth. I believe that the National Service scheme has been launched well on this occasion. The lads themselves have done a splendid job and their parents have co-operated loyally in the scheme. I also express appreciation of the commendable manner in which the officers and non-commissioned officers have done their work. Their training was based on an entirely new technique which has proved successful. I should like also to pay tribute to the press and to the broadcasting system for the splendid co-operation that they have given us so as to ensure that the scheme would succeed. We faced a difficult task because, although we originally had to provide accommodation for 3,000, suddenly the figure was raised overnight to 10,000. It is no easy job to provide accommodation for such a large number of officers, noncommissioned officers and men at short notice.

To-day we are concentrating on the technical side of the armed forces. We have to keep pace with ever-changing methods of warfare. Honorable members will be pleased to know that we are about to start parachute training in the Citizen Military Forces. Such training will spread to all the armed services, including the Air Force and the Navy. I believe that when the Citizen Military Forces parachute unit has been properly trained we shall have moved a long way towards being able to defend this country adequately. In addition to that we have just received the first of a number of Centurion tanks which will form a part of the organization of the Army. The

Centurion tank is the most up to date tank in existence.

In passing I should like to pay tribute to the railway services and the main roads boards of Australia for the work that they did in assisting us with the transport of the tanks. They have prepared special rolling stock and have altered road bridges to ensure that the tanks can be conveyed either by rail or by road, so that they will be effectively mobile in an emergency.

We are doing our utmost to push ahead with specialist training of officers and non-commissioned officers. The only way in which an armed force can be developed and expanded is by ensuring that properly trained junior officers and noncommissioned officers shall be available to handle the incoming recruits. Nowadays it is not possible to pick men off the streets and hope to he able to make good soldiers of them overnight. We have to be prepared well in advance of any emergency. We must not forget that the days when wars were declared have gone. Nowadays countries find themselves at war with absolutely no notice of it having been given. We are now sending the brightest and best of our young officers to the United Kingdom, America, Canada and Pakistan to learn and to exchange ideas on methods of warfare. Officers and noncommissioned officers from those countries are also coming to Australia for the same reason.

In addition, we are enlarging the facilities for training officers and noncommissioned officers in Australia. The number of officers entering the Royal Military College at Duntroon is being increased, and from the 7th January of next year a new cadet officers training college will be opened which young lads will be able to attend after they have been selected or appointed as students. We hope that men with special experience and training in Korea, returned men from the last war, permanent soldiers and members of the Citizen Military Forces, National Service trainees, as well as qualified university students such as engineering students, and other civilians, will attend the new college, and, after 22 weeks’ training, pass out as second lieutenants. Such men will be able to develop the nucleus of the great army which is so badly needed by this country. Substantial progress bas been made in this direction, and I am sure that as a result we shall have one of the finest fighting forces that we have ever had.

The whole of the basis of the fighting forces is that of having one army. During the later stages of the last war some people who were in uniform did not know to what branch of the army they belonged. To-day we have one army the members of which have volunteered to serve in any theatre of war. I wish to pay tribute to the men of the Permanent Military Forces and the Citizen Military Forces for the very splendid way in which, having already enlisted for home service only, they agreed to serve anywhere in the world. These men have brought into being a very fine spirit of morale throughout the country, and I believe that, as a result, our army has become an organization of which everybody in this Parliament and outside of it can be justly proud.


.- Apparently the Minister for the Army (Mr. Francis), like a number of other honorable members opposite, is not enthusiastic about this inflationary budget, because he did not deal with it in his speech. The Minister did not mention the enormous estimated surplus of £11.4,500,000 which may become £200,000,000, When a Minister addresses the committee on the occasion of a debate on the budget he should state what the Government intends to do with the increased taxation that it proposes to impose on the people. I have heard the budget called a calamity budget and I consider that to be a good description of it. The people of Australia are entitled to know the Government’s exact intentions in taking from them such an enormous amount of money. The Treasurer (Sir Arthur Fadden) has stated that he intends to collect in excess of requirements in order to look after what he regards, as surplus spending power on behalf of the people. The people have not had much difficulty in looking after their own money. They have put it into war bonds and have used it for other good purposes. The Minister for National Development (Senator Spooner) stated in the Rockdale Town Hall recently that the. Treasurer would not spend, a penny of the estimated surplus of £114,500,000 except over his dead body. On the other hand, some Ministers have stated that the £114,500,000 will be used to make up the deficiency between what the Australian Loan Council is able to borrow and the £225,000,000 that it has decided to raise.

Apparently Ministers are in conflict on the subject of what is to be done with the people’s money. I believe that a large number of honorable members on the other side of the chamber do not approve of this budget. Many of their statements have been in conflict with the statements of the Treasurer. I contend that the Opposition’s amendment should be carried and that the budget should be withdrawn and redrafted. It is desirable that the population of Australia shall be increased yet a young couple who become engaged have to pay a tax of 13s. 4d. in the £1 when they buy their engagement ring.

Mr Bowden:

– What a shame!


– Of course, the honorable member for Gippsland (Mr. Bowden) has never had occasion to buy an engagement ring. That tax is a great encouragement to the young people of this country to marry!

Mr Hamilton:

– It will not stop them.


– I do not suppose it will. The Australian people do not care very much about 13s. 4d. where an important matter is concerned, but when they have 13s. 4d. taken from their wages many times they will start to worry. The Government has proposed a tax of 6s. in the £1 on toys, 4s. in the £1 on ice cream and sweets, and 13s. 4d. in the £1 on birthday party caps. The country must be in a terrible state if the Government finds it necessary to take pennies from children. I believe that many honorable members opposite are scared of this budget. It has been said that before the next general election the Government will have an opportunity of presenting two more budgets to this Parliament, but even if that be so I am sure that the people will not forget this budget. The Government is on the way out and, if rumour be correct, those gentlemen who sit complacency are in very grave doubt-

Conversation being audible,.


– Order ! There is too much audible conversation.


– I consider that the Minister for Immigration (Mr. Holt) is doing a very good job in many respects. He wishes to bring here as many people as possible, particularly from the British Isles, but a large number has come from Europe and that, in the opinion of many Australians, is not so desirable. I know that the Minister could not avoid admitting a lot of these people. A couple of weeks ago I directed a question to the Minister concerning new Australians who had committed serious crimes in the country. A number of those persons were murderers and vicious criminals. Apparently the Minister becomes annoyed when anything is said about this matter. I do not say that he is altogether responsible for the admission of these people, but somebody is responsible and probably those officials selected the immigrants overseas. The policy of the Government was that those new Australians who were convicted of an offence and sentenced to more than twelve months’ imprisonment should be deported.

Mr Holt:

– That is not quite accurate. I referred to a person convicted of an offence punishable by a sentence of twelve months’ imprisonment even though the court had sentenced him to a shorter period.


– Some very serious crimes have been punished by less than twelve months’ imprisonment.

Mr Holt:

– That is not the position. It may be Hansard’s version of my reply to the honorable member’s question but it is not correct.

Mr Pollard:

– The Minister should not blame Hansard reporters. They write some good speeches for him.

Mr Holt:

– I agree. I am merely trying to give to the honorable member the facts of the matter.


– Those immigrants who commit crimes which are either serious or vicious should be deported as soon as possible. There should be a more thorough screening in Europe of immigrants to this country than there is at the present time. The people of Australia have been disturbed by the many serious crimes that have been committed by immigrants. I know that these people have had terrible experiences, but immigrants should be of a better standard than are some of those who have been admitted to this country in the past. I know that at one time a number of men in the Bathurst immigration centre who had had the Hitler mark tottooed on their arms had it removed. The record of those men in Germany could not have been very good, and the record of many of them in Australia has been bad. Police officers in New South “Wales and Victoria have said that immigrants should be more thoroughly screened.

The Government should adopt a more generous policy in connexion with social services. Since the social services legislation was passed the cost of living has risen so much that the value of the few shillings that were gven to pensioners under that legislation has been whittled away. It is almost impossible for pensioners to live. A responsible social worker in Newtown, New South “Wales, has stated that the 10s. rise is ridiculous and that a person cannot exist on less than £4 a week. I agree with that, and consider that even at this late stage the Social Services Consolidation Act should be amended to give some further relief to pensioners who to-day are on the verge of starvation. In my own electorate, but for the generosity of some business people, many aged pensioners would not have had any Christmas dinner last December. There is’an urgent necessity to review the rates of pensions. I believe that many honorable members on the Government side of the chamber have sympathy for the pensioners. I also believe that they have indicated in their speeches that they had no voice at all in the drawing up of the budget.

Mr Pearce:

– The honorable member should wait and see.


– If the Government waits too long some of the people about whom I have been speaking will starve to death and then it will be of no use to see what can be done for them. The Government should do something to help them while they are alive and not wait until they are dead.

The increased taxation on lower-paid workers is certainly not an incentive to them to work harder and produce more. A man who has a family of four or five children cannot live to-day at a reasonable standard of comfort. He cannot get sufficient nourishing food for his family under present circumstances, and the increased taxation will make it still harder for him to rear his family. In that connexion I point to the fact that this week the price of milk in New South “Wales has been increased by 2d. a pint. In answer to a question that I asked him recently, the Minister for Health (Sir Earle Page) informed me that ice cream was invaluable in the diet of growing children because of its great food value. The increased tax on ice cream will put that food beyond the reach of the children of many poor families. That is another adverse effect that this budget will have upon the lowerpaid worker and his family.

At present the Defence Preparations Act is in force. That act was designed, among other things, to divert a large number of employees from so-called “ non-essential “ industries to more essential work. When such industries close down the goods that they were producing will quite probably be imported from Japan. In fact, we have seen something of the sort happening recently. Surely it is better to encourage our small growing industries, which, after all, are employing Australians and contributing to Australia’s wealth, than to spend our money on importing goods from Japan and thus building up the trade of our ex-enemy. I suggest that the Government would do well to encourage our small non-essential industries rather than discourage them to the point where they shall have to close down.

Before the last general election the Government parties told the people that if elected to office they would reduce taxation and put value back into the £1. Since they assumed office they have increased taxation and the value of the £1 to-day, as the honorable member for Brisbane (Mr. George Lawson) said, is worth about six pre-war shillings. It is shocking to realize that the value of the £1 is 30 low. Not only has our overseas credit been destroyed, but the actions of the Government have also destroyed our credit within Australia. That has been shown by the fate of the last loan floated. The loan was under-subscribed by nearly £8,000,000. That was the first time within my memory that a loan floated by an Australian government was not fully subscribed. It is interesting to consider the record of the New Zealand Government, and to compare it with the record of the Australian Government. In New Zealand, the party now in office promised the electors, as our own Government promised the electors of Australia, to reduce taxation and to speed up that country’s defence programme. They have reduced taxation and instituted a vigorous defence scheme. As well as doing that the New Zealand Government, has increased age and invalid pensions to a much greater degree than our own Government has increased them in Australia. I hope that during the current session of the Parliament, Government supporters will urge the Prime Minister (Mr. Menzies) and the Treasurer to try to do something more to help that section of our people who so badly need government assistance. That is the section composed of age, invalid and ex-servicemen pensioners. Many of 0U age pensioners are the pioneers of Australia who made it possible for us to be here to-day. I hope that now that the budget debate is nearing its end, the supporters of the Government will press for some amendment of the social services allocation along the lines that I have indicated.


.- Because this debate has been proceeding for three weeks and almost every possible argument has been put forward, there is not much fresh that one can say. However, I hope to deal with some important matters. The most vital matter that faces Australians to-day is the defence of this country. It does not matter how prosperous we are, how our industries are flourishing, or how productive is the land, if Australia is not protected everything may be lost to us. History records that Sir Francis Drake finished a game of bowls while the Spanish Armada was in sight and before he sailed forth to attack it. The tempo of warfare has changed so greatly since then that we cannot afford to delay for one moment in build- ing up an adequate defence system. Speaking of defence: I should really like to know what is the policy of the Labour party on this important subject, and indeed what is its general foreign policy. Although I have listened attentively to the speeches of honorable members opposite, from their Leader to their backbenchers, I have heard nothing constructive. All their arguments about defence have been destructive.

I listened recently to a statement made by the Leader of the Opposition (Dr. Evatt), in the course of which he said that the United Nations should be called upon to decide what should be done as between Great Britain and other countries in the Middle East. He said that, as a champion of the United Nations, he was in full accord with Australia’s action in relation ot Korea. In the light of the right honorable member’s statement, I ask whether he, or any of his supporters either in this chamber or outside of it, has ever done anything to help to recruit personnel for the reinforcements that are so urgently required in Korea. If the United Nations took the same action in the Middle East as it has taken in Korea, would the Labour party take the same attitude and do nothing about recruiting for Australia’s section of the United Nations’ forces? Not one member of the Labour party has appeared on our recruiting platforms. I mentioned that once before when the honorable member for Ballarat (Mr. Joshua) was in the chamber and he said “ Ob, yes “ - indicating that he had done so. I retorted, “ You may have done so before you came into this House, but you will not do so again “. That was quite a correct statement because the Labour party is not behind the Government’s recruiting campaign. What is the good of honorable member opposite giving lip service to the United Nations when they are not prepared to back up their words and help to recruit men to strengthen the forces of the United Nations? Our primary and secondary industries should be built up so that reservoirs of food and materials may be established for our allies and ourselves to draw upon in time of war. We should be remiss in the discharge of our duty to the men who have laid down their lives in many theatres of war if we were not at this stage prepared to fight again to retain the freedom that they won.

The proposed vote for defence is £182,000,000. I have not heard many honorable members opposite speak against the appropriation of that sum. They are prepared to have that money expended on defence, provided that Australians are not sent to Egypt or some other place in order to defend us. Some honorable members opposite have indicated that they oppose the expenditure of this sum, and have charged the Government with war mongering because it decided that it was necessary to expend it on the defence of Australia. In the last war conscripts from America protected us, and we should now develop a system that will allow us to pull our weight in any future conflict. The honorable member for East Sydney (Mr. Ward) said, in effect. “ In any case, what influence would the few men we could send from Australia have in any war ? “ That is a slur on the manhood of this country. What influence did Australian airmen, who were trained in Canada under the Empire Air Training Scheme and who fought in the Battle of Britain, have in the spheres of conflict in which they took part in World War II.? They blazed their name across the world as flying fighters. What influence did the men of Anzac have at Gallipoli in World War I. ? The fighting men of Australia have won renown in operations on the sea, under the sea, in the air and on the land. Their exploits in both world wars helped to strengthen the morale of the British Commonwealth of Nations. We have only a small population, but our men are noted for their initiative and resourcefulness. Only in to-day’s press one may read reports in which men of world standing pay tribute to the tough fighting qualities that are being displayed by Australian servicemen in Korea. The statement of the honorable member for East Sydney disparaged the fighting men of this country.

It has been said that the world should be ashamed that, after two world wars, we are now preparing for another war. The implication in that statement is not correct. The Australian people do not want war. Every honorable member and every Australian engaged in the factories and fields of this country loves peace. The last thing they want is warfare. The British race has always stood for peace and, to-day, with the Americans, they want to preserve peace. But so long as Russia continues to arm and keep in readiness many divisions of troops we must prepare to meet the threat that such activities present. The expenditure of £1S2,000,000 on defence proposed in the budget, represents our contribution to preparedness not only for war but also for peace, because the most effective means of ensuring the maintenance of peace is that of being prepared for war. If an individual like Chief Little Wolf walked down the street he could not buy a fight even if he tried to do so; but a man .who is small in stature and obviously not of average strength would soon find an opponent. The same observation can be applied to nations as well as to individuals. Only by strengthening our defences can we help lo ensure that peace shall be maintained. And only in that way shall we retain the freedom that the British people have always treasured so highly.

In the limited time at my disposal, I wish to refer to our great industries, the greatest of which is that of woolgrowing. The Government’ has done much in co-operation with the woolgrowers. I was pleased to learn this afternoon that the money that was raised by a levy at the rate of 7£- per cent, to form the nucleus of a wool stabilization fund on the basis of a reserve price is to be repaid to growers at the end of next month. After all, that money belongs to the wool-growers. I am also proud of the Government for continuing the auction system of disposing of wool in Australia. Supporters of the Labour party declared that the. Government would abandon the auction system in spite of the fact that the Prime Minister (Mr. Menzies) and every honorable member who sits behind him in this chamber unequivocably advocated during the last two general election campaigns the retention of the auction system as the fairest way of selling wool. So long as this Government remains in office, it will retain that system in time of peace. The Government is also negotiating with representatives of the woolgrowers concerning the repayment of the balance of the money that remains in the Joint Organization fund. It is seeking to determine the mostopportune time to make such repayments and also the conditions under which they should be made. Every one realizes that the repayment of that money in a lump sum would not help the growers in the way in which the Government desires to help them.

This Government is endeavouring to enable wheat-growers to receive a fair share of the wealth that they produce. At present, the home-consumption price for wheat is 7s. lOd. a bushel. That price is reviewed annually and the new price is announced on the 1st December in each year. It is probable that as a result of rising costs of production the home-consumption price will be increased to 10s. or more a bushel as from the 1st December next. The wheat-grower has never objected to wheat being sold at the home-consumption price for human-consumption purposes, but he has long felt the injustice of being obliged to supply wheat at that price for stock feed, poultry and pig-raising. Some years ago, when a severe drought occurred in Queensland, wheat was sent to that State and sold to sheep-raisers at the home-consumption price, which was then from 5s. to 6s. a bushel less than the world parity price. However, when that drought ended, the sheep and the wool that had been saved by the supply of that wheat were sold at world parity prices. The wheat-grower received no benefit in return for having supplied wheat to those sheep-raisers at the home-consumption price.. Each of the State governments must pass supplementary legislation before the proposal of the Government to increase the present price for stock feed from 7s. lOd. to the price of 16s. Id. a bushel, the present export price, under the International Wheat Agreement, can be implemented.

Justice must be our first concern in this matter. It is unjust to compel the wheatgrower to supply wheat for stock feed, poultry and pig-raising at a price that is less than that for which wheat is being sold overseas. These industries should be assisted by the Government, not by the wheat-grower. The Government recognizes that to be an injustice and proposes to increase the price of stock feed from 7s. lOd. to 16s. Id. a bushel. Every one will deplore the serious decline of the acreage now being sown for wheat. The payment of a just price for wheat for stock feed should stimulate the industry and encourage growers to sow greater acreages.

Recently, I urged the Government to make a further payment from the Wheat Stabilization Fund, in which the balance now amounts to over £30,000,000. It is high time the Government took such action. In reply to a question that 1 addressed to the Minister representing the Minister acting for the Minister for Commerce and Agriculture, I was informed that my suggestion would be investigated. The balance in that fund is far in excess of the amount that would be required to meet any forseeable setback to the industry. I was astonished that the announcement this afternoon that the assessment of the Joint Dairying Industry Advisory Committee that the price of butter should be 3s. 6d. per lb. would be fully paid retrospectively to the 1st July, 1951, did not meet with the approval of members of the Opposition. I cannot understand their attitude on that matter. At present, the Government is providing a subsidy of £16,400,000 a year in respect of dairy products and the price of butter has been out of proportion in relation to the prices of other primary products. The Governments of New South Wales and Queensland refused for so long to approve of the increase of the price of butter that dairy-farmers would have suffered considerable loss had this Government not decided to provide sufficient finance to make up the price to 3s. 6d. per lb. to them.

Members of the Opposition have criticized the Government on the ground that it had failed to put value back into the £1 and to reduce taxes. As I said in a speech that I made in this chamber recently, one does not expect a boxer to win a fight in the first round.

Likewise,, no one could have expected this Government to erect a sound structure on blocks that had been riddled by white and red ants during the eight years that Labour was in office. The first task that confronted thi3 Government was to stem the tide of socialism; and it is well on the way to achieving that objective. Had the Government, upon assuming office, been able immediately to put value into the £1 and to reduce taxes permanently, one would have concluded that its predecessor’s administration had not been very bad. However, as the Prime Minister has said, the Government’s task has been made extremely difficult as a result of eight years of Labour socialism. The Government must clean up the rot that was caused by past Labour governments before it can stabilize the economy. I believe that before the next general election comes round, it will have reduced taxes substantially. The Leader of the Opposition (Dr. Evatt) has said, in effect, “ Oh, well, now you are doing certain things, but already prices are starting to decrease before any decrease could possibly come from your methods “. On the preceding day, the price of wool had declined substantially. However, on the following day wool prices rose by 25 per cent. Those facts show how little the Leader of the Opposition knows about markets in Australia. So long as war remains imminent, democratic governments must stockpile materiels for war. Consequently, less goods are available to the community; and when the purchasing power of the community is abnormal shortages are accentuated.

The Government proposes to increase the sales tax as one means of diverting purchasing power from luxury to essential commodities. I do not agree entirely with the Government’s proposals in this respect. I am not one of those who believe that the Government is always right, that the Labour party is always wrong and that the Australian Country party is infallible. I submit that washing machines and refrigerators are not luxuries but necessaries, and should be exempt from the sales tax. However, I do not forget that that tax was originally introduced by a Labour government in 1930. At that time the country was experiencing a depression and supporters of the Labour party still claim that the average Australian was then obliged to tramp the streets and roads in search of work and could not afford to buy the necessaries of life. Nevertheless, the Labour Government chose that time to introduce the sales tax in order to grind the last penny out of the average citizen. Today, our economic position is different. There is an abundance of money in the community and most people can afford to pay reasonably high rates of taxes. The purchasing power of the community is greater now than it has ever been in the history of this country. I deplore the fact that when money i3 plentiful and essential commodities are in short supply some people are prone to buy goods that they do not really need. That does not assist the country to progress.

The Leader of the Opposition pointed out that Australia enjoyed great prosperity when the preceding Labour Government was in office. Such a statement may be regarded as correct, provided it is understood that little progress was made during those years, Prosperity means nothing unless it is accompanied by progress. Only a wise government can expend in the proper channels the moneys that are made available to it as a result of prosperous conditions, in order that the country shall have lasting progress, and be tided over those periods of bad times that are experienced by every country that is almost completely dependent on the sale of its primary products.

The honorable member for Wannon (Mr. McLeod), when he referred to the petrol tax, stated that a number of newspapers in his electorate, such as the Coleraine Albion, the Hamilton Spectator, and the Casterton News - I know them all, because I lived in that district - were complaining that the Commonwealth was not making a fair distribution of revenue from that source to the States and local authorities. Evidently the honorable gentleman has not kept in touch with events recently. The Chifley Labour Government, in its last year of office, provided an amount of £9,400,000 from receipts from the petrol tax, but the present Treasurer (Sir Arthur Fadden), in the budget that he presented to the Parliament last year, estimated that £12,000,000 would be available from that source, and actually £14,000,000 was provided from it as the disbursement was then related to the quantity of petrol that is sold, and, according to estimates, the amount of money that will be available for the construction and maintenance of roads this financial year will be £16,000,000.

I have been asked to comment upon the amount of loan money that will be available to the Government of Victoria this year for State works. It is true that the Commonwealth has two votes and each of the States has one vote at meetings of the Australian Loan Council. It is equally true that the Premier of Victoria, Mr. McDonald, voted at the last meeting of the Australian Loan Council in favour of a reduction of loan expenditure on public works. Evidently, the cardinal sin that has been committed by Victoria is that it has been too progressive in undertaking developmental works. The construction of the Eildon weir, the Cairn Curren reservoir and the Rocklands dam project has been commenced, and the electrification of the Murray Valley is vitally necessary. Those works are progressive, but, unfortunately, sufficient money cannot be provided during the current financial year to enable all of them to be continued. The Commonwealth cannot be blamed for such a condition of affairs; it must fight inflation. I asked the Minister for Defence (Mr. McBride) yesterday whether he would recommend to Cabinet, that some of those projects be completed under the defence programme if it could be proved that they had a defence value. The Minister most courteously replied that he would investigate the position, and that if he found that some of those works were valuable for defence purposes he would recommend that they be completed. As I stated a few moments ago, the cardinal sin that has been committed by Victoria is that it has been too progressive if that is possible in undertaking public works.

I deplore the remarks by the honorable member for Isaacs (Mr. Haworth), who said that the Premier of Victoria had been associated with a certain former

Premier of that State for so long that he had learned some of the worst lessons and was now practising them in the worst possible way. Mr. McDonald is quite capable of speaking for himself, but the former Premier of Victoria, to whom reference was made, is presumably the late Sir Albert Dunstan. That gentleman was honoured by His Majesty the King when a Liberal party government was in office . in Victoria. No doubt, that Government recommended to His Majesty that a knighthood be conferred upon Mr. Dunstan. I should not be loyal to the memory of the. late Sir Albert Dunstan, who was the Leader of the Country party in that State for many years, if I did not make these remarks. The honorable member for Isaacs disparages the Country party in Victoria, but his party now calls itself the Liberal and Country party, presumably in order to derive some prestige from the work of the Country party, and to gain some votes from the confusion that must be caused at a general election by the adoption of the latter part of that name.

This Government has done a great job for totally and permanently incapacitated ex-servicemen. During the last twelve months, the special pension for those unfortunate men has been increased from £5 6s. to £8 15s. a week. A recreation allowance of up to £10 a month is also payable, and a motor car is given to a man who is unable to move about because of physical infirmity. The pension for a partially disabled ex-serviceman has been increased from £2 15s. to £3 10s. a week. I remind honorable members that the Chifley Labour Government did not increase the base pension for four years, and that during that period, the pensions of totally and permanently incapacitated ex-servicemen were increased by 5s. a week. Mr. Wilson, who is the president of the Returned Sailors, Soldiers and Airmen’s Imperial League of Australia in Victoria, is reported as having said that the special pension, and the 100 per cent, base rate, have always been increased simultaneously. That statement is not correct. In 1947-48 the Labour Government increased by 5s. a week the pensions of totally and permanently incapacitated ex-servicemen, but did not increase the base rate.

The co-operation of every person in this community is required in order that this country may achieve real greatness. We have the soil, we have the men and we have the money, too. Let us, in cooperation, do something that is really worthwhile. Let us give practical effect to the plea for co-operation that has been made by the honorable member for Melbourne (Mr. Calwell) in a book that he has written. So as to make that publication appear important, the price, 6d., is printed on the back of it. The book is not worth the paper on which it is printed if the author and his supporters are not prepared to carry out the principles that are enunciated therein. We have asked the Labour party for co-operation, but its vision is obscured by the next general election. The honorable member for Melbourne, speaking in the Labour Hour one Sunday afternoon after the last general election, said -

It is not too long to wait for two years.

I do not know why he said two years, because at that time the next general election was three years distant. In the meantime, the more chaos, the better, appears to be the aim of some Labour members here to-day. I deplore such an attitude.

All political parties should cooperation in order to assist Australia to progress. We have all the things that are required for progress. Australia would he a wonderful country indeed if every honorable member, irrespective of the political party to which he belongs, said, “ I am all for Australia “. When the right honorable member foi Bradfield (Mr. Hughes) was speaking, the honorable member for East Sydney interjected, “ What government was that?”. The right honorable gentleman displayed great wisdom when he advised the interjector, “Forget governments. Think of Australia “. We all should think of the Australia of the future. There are young Australian men and women who are a credit to the country. We can give to them great opportunities in future only if we do the right things now. We get a glimpse of the future only by looking into the past. People in the past did their job. It behoves us to play our part with credit. We want more houses. For example, 1,000 houses are required for a start in the Murray Valley. Four-fifths of the waters of the river Murray flow into the sea. That valuable water should be conserved. Australia requires more power and irrigation, and more men to do a fair day’s work for a fair day’s pay. All these things are necessary in the building of this nation.


– I regret that this debate ‘ has been prolonged to such a degree that the committee has been discussing the budget for three weeks. For myself, I feel that the Leader of the Opposition (Dr. Evatt) gave a most effective reply to the budget speech of the Treasurer (Sir Arthur Fadden), and showed clearly the policy that should be followed in order to place Australia upon an economic basis about which the people could he enthusiastic. I am convinced that the honorable member for Mallee (Mr. Turnbull) has not been reading his correspondence lately, because he appears to believe that exservicemen are satisfied with the increases of pension that have been granted by the Government. I have in my drawer a letter from Mr. Holland, who is the president of the Returned Sailors, Soldiers and Airmen’s Imperial League of Australia, in which he indicates, in effect, that this Government has done practically nothing for disabled exservicemen, and that they are completely disappointed with the result of their efforts to obtain recognition for their claims. Apparently the honorable member for Mallee is full of enthusiasm about the increases of ex-servicemen’s pensions, but I think that he is overflowing with futility. He continues to support a government that has not attempted, since it took office in December, 1949, to put into effect a programme that would benefit the Australian people.

The honorable member for Mallee has urged the Labour party to co-operate with the Government in order to make Australia really great. I do not think that it is possible for the Labour party to co-operate with a government of this kind which, in my opinion, is protecting the interests of the wealthy and is fleecing the poorer section of the community.

The budget inflicts -a heavier tax burden upon the general public, and the fact cannot be denied that an increase of income tax of 10 per cent, will weigh more onerously on the workers, and on persons on fixed salaries or who have no income other than wages, than on those persons who are reaping vast profits. I venture to say that the United States of America and Canada are the only two countries in which a few people are reaping higher profits than their counterparts are reaping in Australia. One has only to read the newspapers from day to day to learn- that the vast majority of companies and organizations which manufacture or deal in the things that we need are making immense profits, because they are completely uncontrolled. Evidently, this Government will permit their profits to remain unrestricted, because it has not introduced any legislation to curb them.

When I make such statements, I am sometimes told, “Well, everybody has to pay in a time of war “. The Minister for the Army (Mr. Francis) said to-day that the Prime Minister (Mr. Menzies) had declared that war was not inevitable. Such a statement was refreshing, because every one was most impressed when the Prime Minister predicted in the last Parliament that we were bound to have war in three years’ time. Members of the Labour party cannot forget that kind of thing. I realize that the right honorable gentleman has been accused of being a warmonger. I do not consider that there is much profit to be gained from an honorable member on this side of the chamber accusing his political opponents of being fascists, and his opponents charging us with being Communists. Too much of that nonsense is talked. I do not believe that all Government supporters have fascist tendencies, but I think that some of them have a strong inclination to favour a form of government that would enable them to inflict on the people whatever legislation they approve. Most members of the Opposition, on the contrary, are elected to represent the interests of those who do the real work of the nation - the humble people who enable the country to function efficiently. The Curtin Government and the Chifley Government may have incurred some displeasure, but it would be impossible for any government to remain in power over a period of eight stormy years in war and the aftermath of war without displeasing some persons who normally would support it.

Advertisements and other documentary evidence have been produced in this chamber many times to prove that this Government gained power by false pretences. There is not the shadow of a doubt about that. Honorable members on this side of the chamber are often told that they should not live in the past, but the honorable member for Mallee has said that we must study the events of the past so that we can cope efficiently with the conditions of the present and provide for the future welfare of the nation. There seems to be a marked division of opinion between the parties that are represented on the other side of the chamber. If the Australian Country party were doing its joh properly, it would be supporting a Labour government, because the Labour party represents 49 per cent, of the people of Australia. But, instead of doing its duty, it is supporting a group of individuals who are prepared to enact measures from the detrimental effects of which it will take the nation years to recover. Probably the Labour party’ will be called in eventually to clear up the mess caused by the maladministration of this Government as it did previously.

Wo have been told over and over again that high wages, lack of production and reduced hours of work have caused our present economic ills. I direct the attention of Government supporters, very few of whom, unfortunately, are present, to the views on this important subject that have been expressed by a man who has been placed in charge of defence preparations in the United States of America, a country that is much nearer to the probable scene of a future war than is Australia. This gentleman is Mr. Charles E. Wilson, the former president of the giant General Electric Company, who now bears the title of Chief of Defence Mobilization in the United States of America. He made news recently when he emphatically declared himself in favour of the 40-hour week on the ground of efficiency. I ask Government supporters to take note of the con- sidered opinion of this man, who occupies one of the most responsible posts in the United States of America. He said -

A maximum eight-hour day and 40-hour week have been found best in terms of efficiency of production.

We know that the Government has been asked to intervene in an important case that will come before the Commonwealth Court of Conciliation and Arbitration at the end of this month, when representatives of the employers will seek the restoration of a 44-hour or a 48-hour week. I do not know whether the Government will accede to the request, but I sincerely hope that it will not do so. The final effect of any extension of the working week would be industrial chaos throughout Australia. The employers would have no difficulty in satisfying the demand for increased production if they would only organize their establishments on a proper basis. They have neglected their duty to their country and, at the same time, have lost opportunities to gain an advantage for themselves. Mr. Wilson went on to say -

Experience in World War II. demonstrated that excessively long work hours caused so much waste in the form of spoilage, absenteeism and inefficient work performance that little benefit to the war effort was derived from attempting to maintain longer schedules for extended periods.

I ask all honorable members on the Government side of the chamber to remember that statement! Some of them have good intentions, hut they have been raised in a political school that expounds the doctrine that the Labour party stands for shorter hours, higher wages and chaotic conditions in industry that will retard production. That is completely false. I do not want to charge them with having fascist tendencies, although it is obvious that some of them have such leanings, but I do ask them to think seriously about this matter. Official records that deal with the subject are available in the parliamentary library for’ their information. They should be influenced by the views of Mr Wilson, who has a long record of successful industrial management to back his assertion that a 40-hour week is the most efficient working week.

The newspaper report from which I have extracted his comments also points out that his statement was concurred in, both by an inter-agency man-power policy committee composed of heads of Government agencies and by a labourmanagement man-power policy committee that had been advising him on manpower problems. The report continued -

Longer hours may be required in some defence plants for limited periods and only in areas where man-power is scarce. In such industries the added hours should be as few as possible, with 48 a week aa the absolute maximum.

I speak as one who frequently worked 56, 60 or even 70 hours a week on the footplate, as did my highly respected former leader, the late Mr. J. B. Chifley. The honorable member for Blaxland (Mr. E. James Harrison) and the former Minister for Repatriation, Mr. H. C. Barnard, also did likewise in their younger days. We went through the mill and we know what is involved in working long hours. Men who were tied to a timetable had to cover a certain mileage in a specified time unless some extraordinary delay occurred. That is not the way to achieve efficiency. We cannot lightly set aside the opinion of a man who has been the president of one of the largest manufacturing organizations in the world. He firmly believes that a maximum eighthour day and a 40-hour week afford the greatest productive efficiency.

Mr Eggins:

– But that would be achieved largely on a basis of incentive payments.


- Mr. Wilson did not make a reference to incentive payments in the part of the statement that I have been quoting. Nevertheless, I believe that incentive payments could be introduced with advantage provided that they were properly regulated. The average worker to-day objects to incentive payment schemes because he remembers the evil piece-work system that was in vogue many years ago. The object of that system was to induce a worker to accomplish a fixed number of tasks in a specified number of hours. But when he had achieved that rate of production, his tasks were multiplied for the same amount of pay. Australian workers are never likely to forget that system. One organization that used it was the Sunshine harvester organization.

Government supporters may have forgotten the shocking conditions that applied in Australian factories in those days, but the workers still remember them. The miners, too, have not forgotten their struggles, and honorable members on the Government side of the chamber have to live down the bad reputation that their political supporters have gained. I agree that incentive payment systems may be of advantage if they are properly regulated. However, Mr. Wilson did not advocate them in the statement to which I have been referring. He said -

Furthermore, man-power shortages in one labour market will not justify lengthening the work week in another area where available reserves of labour still exist.

Another important point that he made was that, where such overtime was necessary, it must be paid for at the rate of time and a half; that such premium pay was vital as an incentive to workers when longer hours were essential. That is the only reference that he made to incentive payments of any kind. He added -

Any attempt to tamper with the extra pay for overtime would imperil existing union agreements and would lead to tension, unrest and accompanying loss of production.

The average Australian worker to-day wants to produce as much as is reasonably possible during his working hours. A few men, I admit, are not willing to do a fair day’s work, but there are many employers who are even more deserving of blame because they do not attempt to modernize their plants so that workers can produce the best results. I wish that some honorable members on the Government side of the chamber would tackle the employers and persuade them to make the improvements that are necessary if labour is to be enabled to function properly.

I now refer to the opinions of another Mr. Charles E. Wilson, who is president of the General Motors Corporation, the largest manufacturing corporation on earth. His views ought to impress employers, and he has declared that dividends paid to stock holders are more inflationary than are wages paid to workers. I emphasize again that these are not the views of a worker; they are the considered beliefs of a man who is the president of the biggest manufacturing organization in the world. I believe that his statements are absolutely true. That is why this budget is entirely unsatisfactory. It provides for a general 10 per cent, increase of income tax charges. No attempt is to be made to impose a heavier increase on the welltodo sections of the community than on the workers. The Government hammers at the workers all the time.

Australia is the victim of maladministration because the Australian Country party persists in supporting the so-called Liberal party, which is not worthy of its name. Its members know nothing about real liberalism. The title of the party is merely a political trading one. In fact, it is a conservative and reactionary party. The American magazine Life, of the 3rd September, reported that the San Joaquin Valley in California - the scene so often of starving “ Okies sweatshop labour and vigilantism against unions - had produced a whole new crop of millionaires. That is what this Government is trying to do. It lacks the punch of the Governments of the United States of America and Canada, but it is bound to look after the interests of those who gave the financial support that enabled its members and supporters to gain victories at the last two general elections. Its first consideration is, not the welfare of Australia, but the welfare of the wealthy groups that helped it to gain power.

Mr Francis:

– The honorable member does not believe that.


– I do believe it. The Minister for the Army thinks that he is not one of that kind. No doubt he tries conscientiously to act in the best interests of the people, hut the unfortunate truth is that he is being used as a tool by the wealthy groups that brought the present Government to office.

A newspaper comment on the statement by the president of the General Motors Corporation that I have mentioned includes the following passage: -

Wilson’s unique letter was written in answer to persons who criticised G.M.’s contract with the auto union under which workers receive wage increases geared to living cost rises, plus a four-cent-an-hour annual “ improvement factor “, so workers will share in benefits of rising productivity.

No doubt Government supporters are horrified at the idea of an “ annual improvement factor “, but they must concede that Mr. “Wilson has been a successful manager of labour.

What is this Government doing to encourage the distribution of the benefits of increased productivity? It offers no real incentives to the workers. It blames Labour leaders for the nation’s present economic difficulties and says to them, “ You fellows are the leaders of the trade unions. Why do you not set them an example ? “ The Mr. Wilson who is the United States Chief of Defence Mobilization does not belong to the trade unions, but he declares that labour works most efficiently on the basis of a 40-hour week ; and the other Mr. Wilson favours an annual improvement factor that enables the workers to share in the benefits of increased productivity.

If the Government wants to have incentive schemes in industry, it should give a lead to the employees. However, instead of doing that, it has produced a budget that provides for a surplus of £114,500,000 but offers no incentive to the workers. The president of the General Motors Corporation contended that the clause in the union contract that he was discussing, which provided for cost of living wage increases, did not contribute to inflation. He said -

As a matter of fact, it tends to resist inflation to some extent, since wages are only adjusted upward several months after the cost of living has increased and the facts recognised. From a strictly inflationary point of view, I am quite sure that the extra dividend General Motors paid last year was one of the most inflationary things General Motors had anything to do with in 1950.

What about the Australian companies that are increasing their dividends steadily year by year? The Government, is doing nothing to restrict their profits. It claims that it is governing for the benefit of Australia, but it is giving those organizations an entirely free hand. Excessive profits are being made in all parts of Australia, but the Government turns a blind eye to them. I believe that this budget will go down in history as the most disappointing budget ever to be presented by any government in Australia and as one which has for its objective the care of the interests of those who are already well catered for, while the task of those who are struggling to make ends meet will be made more difficult.

Trans-Australia Airlines has been the subject of a good deal of press comment recently. The press has not hesitated to say that a scheme is on foot to sell it to Australian National Airways Proprietary Limited. The journal Aircraft, in its edition of September, 1951, published a special article, written by the assistant general manager of Australian National Airways Proprietary Limited. It would do honorable gentlemen opposite good to read the article, notwithstanding that it condemns Trans-Australia Airlines from every possible angle. Although the honorable member for Bass (Mr. Kekwick), the honorable member for Franklin (Mr. Falkinder) and other honorable gentlemen opposite have been sufficiently liberal minded as to say that Trans-Australia Airlines is a fine organization and that it has done a good job for Australia, the article to which I have referred reeks of condemnation of it. The author suggests that Trans-Australia Airlines was established only for the purpose of destroying the airlines that had pioneered the airways of this country. The real pioneers of the Australian airways were Kingsford-Smith and men of that type. Later, Australian National Airways Proprietary Limited and other private airline companies exploited their great achievements.

I do not suggest that Australian National Airways Proprietary Limited is not a competent organization. Indeed, it is so competent that at one time it was swallowing many other Australian airlines and was in the process of becoming one of the greatest monopolies that Australia had ever known. If we had not established the Australian National Airlines Commission I believe we should now be in the clutches of a monopoly that could, if it considered it to be desirable to do so, withdraw its aircraft at a time when we were most in need of them. That is one of the dangers that is inherent in a private monopoly. The Labour party believes that Australian airlines should be associated with the defence of Australia and that they are an essential part of our defence plans.

It is true that a Labour government attempted to establish a monopoly for the Australian National Airlines Commission. I was Minister for Civil Aviation at that time, and I accept responsibility for what was done. The reason why that Government tried to establish the monopoly, apart from the belief of the Labour party that if there is to be a monopoly it. must be not a private but a government monopoly, was that Australian National Airways Proprietary Limited had then swallowed eight airlines. I recall that the present Prime Minister (Mr. Menzies) said, prior to that time, that if any undertakings were to be nationalized, they should be undertakings connected with water conservation, transport, power, &c. That was what the Labour party tried to do.

I do not believe that the Government proposes to interfere with TransAustralia Airlines, despite the fact that it sold Amalgamated Wireless (Australasia) Limited and, by so doing, caused employees of Trans-Australia Airlines to become uneasy about the future. Honorable gentlemen opposite used to refer sneeringly to the Labour party caucus. They have a caucus in which they can express their views. I hope that the honorable member for Bass, the honorable member for Franklin and other honorable gentlemen opposite, including the honorable member for Henty (Mr. Gullett), who applauded the honorable member for Franklin recently in this chamber on this subject, will not hesitate to express their views in their caucus and ensure that Trans-Australia Airlines shall not be sold and thus enable a private airline monopoly to be established.

Of the shares in Australian National Airways Proprietary Limited, Huddart Parker Limited holds 74,999, the Union Steamship Company of New Zealand Limited holds 74,999, Holyman Brothers Proprietary Limited holds 74,999, the Adelaide Steamship Company Limited holds 75,000, the Orient Steam Navigation Company Limited holds 74,998, and Airlines of Australia Limited holds 23,708 in a total of 398,708. Other shareholders, including Mr. Holyman, hold one share each. Australian National Airways Proprietary Limited proposed gradually to expand its activities in such a way as to enable it to swallow all other Australian airlines.

Air mail payments to Trans-Australia Airlines have been referred to. Do honorable gentlemen opposite know that between 1939, or a little earlier, and 1945, the company received £2,540,000 for the carriage of air mails? I suggest to them that, before any moves are made at the dictates of those who helped them to gain power by misrepresentation, they should ascertain the facts. They can be ascertained by anybody. I do not know whether the shareholding in Australian National Airways Proprietary Limited now is different from that which I have read, but that was the position when a Labour government introduced a bill to establish a monopoly for the Australian National Airlines Commission. I venture to suggest that the shareholding still is and will remain as it was then.

Mr. Walsh, the assistant traffic manager of Australian National Airways Proprietary Limited published a wail about the necessity for wiping Trans-Australia Airlines out of existence. Do honorable gentlemen opposite know that Australian National Airways Proprietary Limited has not yet paid a penny piece in respect of airport dues and landing fees and that it owes £500,000 in respect of those charges? It has adopted the attitude that it should not be called upon to pay them. When it operates on behalf of Air Ceylon, it has to pay airport charges outside Australia. It is disgraceful that this Government has allowed the company to go on for so long without having paid for its use of Australian air routes and airports. Last year, Trans-Australia Airlines paid £181,000 in airport dues and landing fees. It is true that, while I was Minister for Civil Aviation, Australian National Airways Proprietary Limited paid nothing in respect of those charges, but we charged the company in an attempt to enforce payment and it went to court to avoid payment. This Government has been in office for nearly two years, but so far it has done nothing to enforce payment by Australian National Airways Proprietary Limited. It has permitted Australian National Airways Proprietary Limited to escape payment of airport dues and landing charges which are being paid by Trans-Australia Air. lines and. Qantas Empire Airways, Limited.

Recently, an honorable senator made an attack in the Senate upon TransAustralia Airlines. His speech, which was widely reported in the press, revealed, that he had absorbed articles published!, in Aircraft and other journals. I am’ glad that even the tory newspapers of this country have adopted the attitude that Trans-Australia Airlines should not be handed over to Australian National Airways Proprietary Limited or any other private organization. I read in the press’ to-day that Ansett Airways Proprietary Limited proposes to reduce its fares. That may appear, at first sight, to be a very good idea: The company mainly provides second-class air travel. I do not suggest that it is not a competent organization, but the fact is that it operates coach services and hotels as well as airservices, and it claims that it is in a position to reduce its air fares because it makes profits from those sources. I wish’ the Government had the power to prevent the reduction of air fares below an economic level. The most important factor in .the operation of airlines is safety, and reduction of fares will tend to reduce it. It is treading on dangerous ground to utilize profits made from hotels and coach services to effect a reduction of air fares.

There are very competent air companies in Australia. I have never suggested that they are not competent to operate airlines properly. I believe that Australian air’ services are among the best in the worldIt would be a great mistake to permit, any Government to interfere with TransAustralia Airlines, or with its present organization. I am proud of the great job that Trans-Australia Airlines has done. We were fortunate to secure Mr. A. W. Coles as chairman of the Aus? tralian National Airlines Commission.


– Order! The honorablegentleman’s time has expired.


– The honorable member for Mari’byrnong ( (Mr. Drakeford) tried to persuade the committee that, under this; budget, the rich man will escape and the workers will be bit hard. Let us compare the income tax that will be paid in New Zealand after the rates there have been reduced with that which will be paid in this country after the rates here have been increased. A man with an income of £500 a year will pay £37 10s. 6d. in New Zealand and £9 lis. in Australia. A man with an income of £600 a year, will pay £58 a year in New Zealand and £20 in this country. Those figures prove that this budget cannot justifiably be described as a high taxation budget in respect of lower incomes. But the story in relation to higher incomes is different. There is a brilliant specialist in Macquariestreet, who has an income of approximately £16,000 a year. Under this budget, the Commonwealth will take almost £12,000 a year from him. After he has paid municipal and State taxes, he will be left with £2,000 a year. He is one of the best specialists in the world, and makes a tremendous contribution to the welfare of this community. Although he has a wife and three dependent children, after he has paid his taxes he will have left only a comparatively small sum.

It is to be hoped that the effect of the budget will be to divert capital and labour from light or unessential industries, which we do not care to specify, to industries that produce food, coal and steel. Since 1939, the population of Australia has increased from 6,900,000 to 8,500,000, or by approximately 23 per cent. Last year, the maternity allowance was paid in at least 193,000 cases. Therefore, our natural increase of population is almost 200,000 a year, or approximately 2£ per cent. That is four times the average natural increase of the population of the world, as Sir John Boyd Orr has stated it to be. This year, our population will increase by 100,000 as a result of immigration. Therefore, we shall have an overall increase of population of nearly 4 per cent. The natural increase is indicative of an extremely prosperous era in this country, but there are some disquieting trends. The rural industries and the secondary industries are out of balance, and there is a degree of unbalance within the rural industries themselves. That is partly due to the extremely high wool prices.

The Monthly Bulletin of Statistics prepared by the Commonwealth Statistician reveals that during the last ten or twelve years the production of butter has decreased by 18 per cent., the production of pork by 21 per cent., the production of mutton by 18 per cent., and the production of lamb by 21 per cent. The decrease of wheat production is especially disquieting, because wheat which we usually have in abundance, ie the basis of the production of dairy produce, poultry and pig meat products. The area under wheat in New South Wales has decreased from 5,000,000 acres to 2,600,000 acres. The crop from that area will not be sufficient to supply the wheat needs of New South Wales or to keep the flour mills in operation for three shifts a day. During the next few months, there will be a great shortage of bran and pollard and of eggs. Already poultry keepers are disposing of their fowls. Pigmeat men are going out of production. We shall have a shortage of food indeed. The position in relation to items the production of which has increased by les? than the 23 per cent, by which our population has increased, is dangerous. Others, the production of which is satisfactory because it has increased by more than 23 per cent., include superphosphate, an increase of 30 per cent. ; black coal, 30 per cent.; wool textiles, 31 per cent.; sugar, 33 per cent.; cheese, 55 per cent.; beer, 100 per cent.; brown coal, 100 per cent. ; processed milk, 250 per cent. Much of our butter production has gone into the manufacture of processed milk items which include ice cream, condensed milk, powdered milk and chocolate. The production of apples has fallen by 23 per cent., and the production of plums and prunes by 49 per cent., but the production of other fruits such as citrus fruits, pineapples, bananas and pears has increased and can be regarded as satisfactory. The whole position means that although we are in a prosperous condition because of high prices for our products, the volume of production of many commodities has fallen or has not increased sufficiently. The times ahead of us are serious because our standard of living will fall and we shall lose some of our export income. It is an extremely serious fact that we have not increased the production of such commodities as wheat, butter, meat, sheep, pig-meat, fruit and vegetables. It is especially serious in view of the fact that our population will have increased by 2,000,000 or 3,000,000 by 1960.

There is a contradiction in all this. I have read on one page of a newspaper reports of fantastic incomes from wool, and on another page a story about farmers leaving the land. That indicates the unbalance in our rural industries. Because of heavy taxes wool men are encouraged to compete for wire netting, tractors and other agricultural equipment, because the cost of such equipment is an allowable deduction for income tax purposes, and the man who pays tax at the rate of 15s. in the £1 saves that payment on the amount involved, which is thus reduced by 75 per cent. They can hoard that equipment and thus prevent other primary producers from obtaining it. Statistics show that the outstanding features of our rural industry now are fewer men, fewer acres, fewer cows, fewer fruit trees, fewer vegetable plants, less oil fertility and more production a nian, an acre, a cow, a tree and so on. Unfortunately the increase of production a man is not enough to make up for the loss of men and the loss of acres tilled. There has been an increase of the area fertilized and sown to improve pasture.3, but it is not enough to return to all the soil the fertility that has been drained from it. It is certainly not so profitable in the long run when growing grain for sale overseas as is the normal method of enriching the soil with manure from animals actually on the farm.

I shall quote from the theories of the noted economist, Mr. Colin . Clark, who supports the view that we must assist our rural industries. He has pointed out that in the last ten years our rural work force has dropped from 520,000 to 420,000, which is a loss of about 13 per cent. I have referred the figures to the Commonwealth Statistician’s office, which says that they are difficult to check but admits that there has been a tremendous decrease of the rural labour force. On the other hand, our factory population has increased in the same period by about 68 per cent, from 540,000 to 917,000. Of that increase 234,000 are females who would not, however, have come from the land.

An extraordinary situation exists in Australia in that the rural industries, in which production has always been more efficient than it has been in our secondary industries, have lost a tremendous percentage of man-power, although our rural products have gained tremendously in value on the world markets; but the world prices do not reach the producer, except in respect of wool, whilst at- the same time the number of workers engaged in secondary production, particularly in light industries, has increased. We have permitted huge numbers of people to leave the land and go into light industries which are too inefficient to meet competition from overseas industries. In fact, the operators of light industry in this country visit Canberra in attempts to get increased tariff protection against overseas competitors. Whilst our rural production has increased tremendously in value, and is likely to continue to increase, there has also been an enormous increase of world population. Taking the figures given some years ago by the honorable member for Canning (Mr. Hamilton), the world’s population is increasing by 20,000,000 people a year. If each one of those 20,000,000 people were allowed 2 lb. of wheat they would use among them more than the whole of our wheat production for one year. As a result of the greater demand for food represented by that annual increase of world population the prices of our rural products overseas will continue to rise. On the other hand, the prices of our secondary products are sure to fall. Australia has foolishly allowed a large part of its rural work force to leave the land and go into factories where production is inefficient, and the prices for the products of which will fall. Colin Clark has pointed out, and there is no reason to disregard what he says, that even with the loss of man-power that rural industries have suffered, production a head of rural workers has increased by 50 per cent, in ten years, whereas the production of factory workers has increased by nothing in the same period. I think that the increase of rural production has been even better than Colin Clark has estimated it to have been. The value of our primary exports has increased to the point* where we are earning twice as much in imports for our exports than we did ten years ago. In effect, we are getting three times as much in imports for the work of every rural worker as we got ten years ago. As we live on the export incomes of our primary industries, Australia is absolutely mad to allow the drift away from rural industries to continue.

The effect of the budget is being felt already, but it is not likely to hurt light industry. I think that one of its effects will he that the number of manufacturers of washing machines and stockings now in production will not increase, because capital issues control will not allow any more money to be invested in those industries. We want any new money for investment to be put into production in rural areas and in the coal and steel industries. We wish the Government to use its capital issues control policy to be so applied that our rural industries will be expanded because, after all, they are the more efficient industries, and receive higher overseas prices for their products. Also, it is on their incomes that the country lives. We cannot depend on the fact that wool has a high export value at present, because that might be just a flash in the pan, and allow our other primary industries that are producing butter, :wheat and so on to decline. A community that has prosperous rural industries will also have prosperous light industries as a result. The policy of channelling capital into rural industries would not hurt the light secondary industries but on the contrary would give to them a prosperous community as a market. A policy of preventing more capital from being invested in light industries would also prevent wasteful competition from new and inefficient industries.

I consider it to be advisable that Australia should try very hard at this stage to obtain improved transport facilities and better machinery for rural industry, and to get more men back on to the land. We should also do something for the poultry and pig raisers, who bear the brunt of the high price of wheat for stock feed. They have already suffered through bad transport, as a result of which they have been unable to obtain wheat and bran and pollard. They have also been unable to get meat meal because of lower slaughtering rates at the abattoirs. As a result of the hard times that they have experienced poultry-men are getting rid of their fowls. That is a serious matter, and it will be even more serious in the next few months. Surely the Government should try to cushion the effect of the price of feed wheat on those people. I make that statement even though I am very much opposed to subsidies, as I believe the community also is and as it has shown in its attitude to the halting of further butter subsidies. I am sorry that the budget makes no provision for poultry-men and pig-farmers.

The first thing that we must do to attract men back to the land is to ensure that proper prices will be received for - rural commodities. This Government has raised the price of butter from its former ridiculously low level. Before the last increase the return from butter to the producer was only 88 per cent, greater than it was in 1945. In comparison with that the return from wool has risen by 542 per cent, compared with its price five years ago. Wheat has risen in price by 33 per cent, in the same period. The Government must assure the butter-producing industry and other rural industries fair prices. Surely the days are past when primary producers should have to work 56 or 70 hours a week for a 40-hour week wage. Let us get rid of the idea of so-called “ assistance “ to farmers. Many people wrongly say that farmers receive too much assistance. Any assistance that farmers get now is merely a sop to persuade them to accept prices for their products, sold both here and in England, that are about half world parity.

Some of the factors that control the supply of labour for rural industries require attention. We must see that decent homes shall be provided for rural workers, with amenities such as bathrooms and refrigerators. The policy of State governments, financed by the Commonwealth, has been to build very modern houses in areas that have non-essential industries. These houses have been’ built not even near steel works or coal mines, but near factories where men are probably making handbags or some such articles. The farmer is also suffering terribly because of lack of materials. In the rich Nowra dairying area in my electorate farmers have been unable for years to get cement except at black-market prices; Australian barbed wire is, I believe, being stock-piled for defence purposes. Japanese barbed wire entering the country costs three times the fixed price in Australia.

The position in respect of fertilizer is the most tragic of all. Australia is unable to obtain enough sulphur for the production of superphosphate, which is the basis of efficient wheat production in Western Australia and of improved pastures in Victoria and the southern parts of New South Wales. The pos,ti )r in regard to lime is even worse. There are rich deposits of lime in New South Wales. I understand that there is only one lime works in Victoria, and that in New South Wales one lime works has gone out of production. It is quite obvious that we have reached the stage in rural production in New South Wales, at which we must put fertility back into the soil, which has been drained of its fertility for a century. We should utilize what is known as the nitrogen clover cycle. Farmers know that nature has provided no less than four-fifths of the atmosphere as nitrogen. They know of the cycle of clover plus superphosphate which draws an unlimited amount of this precious fertilizer from the air down to the roots of plants, there to act as a basis for the proteins that we need. There are millions of tons of nitrogen in the atmosphere that could be used in this way to enrich our soil and increase our rural production. We shall be very short of grain in the near future and farmers will not have time to plant maize and grain sorghum for stock-feed. Because of that they should now be getting to work with pick-up balers and every other means at their disposal to gather the rich natural feed that now covers our pastures and store it away for use later.

The lack of equipment is another disability from which our farmers are now suffering. There have been enough tractors, but they have not .been of the right type. There has been a tremendous shortage of harvesters, of -heavy ploughs and of replacements for existing ploughs’. Some people consider .that transport is the worst deterrent in the rural areas. The; New South Wales railways have refused a vast quantity of freight for some years because of coal and rolling stock shortages and, have now increased their freight rates by 150 per cent, on certain produce. Every one knows what the roads are like, but their repair is prevented, not by lack of money, but by lack of material. I wonder whether the National Security Resources Board has ascertained whether the money that has been allocated tq various authorities in this budget can be expended to secure materials that are in short supply. Some municipal councils still have funds unexpended which were voted to them last year. Transport lies at the base of many troubles. The cost of upkeep of farm vehicles is staggering. The best contribution that could be made to our rural industries would be an improvement of the transport system.

Criticism has been levelled at the Minister for Commerce and Agriculture (Mr. McEwen) in connexion with overseas marketing contracts, but I admire his sincerity and idealism. A statement has been issued to the effect that the Minister has done a brilliant job overseas. What he has done is indeed brilliant in view of the limits of his brief. The Minister had to deal with a Socialist food Minister. His actions have also been restricted by the existence of socialistic commodity marketing acts in this country which the Government has not yet amended.

Mr Curtin:

– They are good acts.


– I hope that they will be amended very quickly. When a government controls an industry it destroys it. Under the existing marketing legislation industries have been controlled to the point where they have commenced to decline. Under the meat contract signed with the United Kingdom during the last few days the best price paid to the producer for hind quarters of beef was ls. 3$d. per lb. com? pared with nearly 3s. per lb. which is paid to the British farmer and the 4s. per lb. which is paid in America. At the 30th June, 1951, the price of butter was 3s. Australian per lb., f.o.b. Sydney, although the present price to the consumer is 3s. 1½d. per lb., and there is a subsidy of ls. 1½d. per lb., making 4s. 3d. per lb. in all.

The butter contract with the United Kingdom Government provides for a rise or fall in price of 7£ per cent., which at present amounts to 3d. per lb., and that Government has refused to increase the price by more than that amount. Consequently, Australia must supply butter to the United Kingdom at 3s. 3d. per lb. if it has any left for export after providing for local consumption. The British farmer receives 2s. lOd. a gallon for milk supplied to the pool, which is equal to about 3s. 5d. a gallon in Australian money. That means that the British farmer receives about 6s. a gallon for milk made into butter while the contract price to the Australian farmer is 3s. 3d. per lb. Some honorable members may say that these remarks are disloyal to Great Britain. I fought in the British Army and I should do so again, but I do not think that Great Britain would want to support inefficient industries temporarily on cheap food and thus destroy Australian agriculture for ever. Surely the United Kingdom has more interest in a prosperous Australia than it has in any other country. Australia is England’s best customer. It pays higher prices for British cars than does any other country in the world. Australian farmers are called upon, under these contracts, to accept starvation prices for their goods and it is impossible for them to continue with this ridiculous way of handling their commodities.

Ten years ago this country had an enormous surplus of production and was charged low prices overseas for the goods that it had to import. At the present time, its surplus production is small and it has to pay high prices overseas. In view of this the Government must do away with subsidies and boards and return the control of primary production to the producers. These industries are strong enough to finance themselves, carry out their own stabilization and make their own contracts. I have given a good deal of study to the work of the Department of Commerce and Agriculture and I con- sider that that department should be renamed the Department of Commerce because it does not assist agricultural production. It merely rations available agricultural production by making overseas contracts. Honorable members who have practical knowledge of rural industries should form a committee on food and agriculture. I do not wish to criticize the officers of the Department of Commerce and Agriculture because they have been very helpful to me. But how is it possible for clerks who, in some cases, have never seen the commodity with which they are dealing, to handle these matters? There are honorable members who are familiar with the production of these commodities and who would be able to formulate a scheme to return that production to producer control. At present only lip service is being given to that principle. There is a provision in the acts to which I have referred under which if the chairman disagrees with a majority decision of the board that decision shall have no effect, and if the matter is reported to the Minister within 24 hours he may make the decision.

My electorate bears the honoured name of Macarthur, the distinguished family which brought to Australia the first merino fleece. I pay tribute to that family and to other wool families who, for over 100 years, have experienced, with their womenfolk, the harsh conditions of floods, drought and heat in the outback, in the development of the wool industry, which has made possible our wool export trade and our great wool income. Instead of attacking the wool man, honorable members should pay tribute to those who have made this country what it is. I do not believe that Australians will slow down in their work because of any impost proposed in this budget. They will take up the challenge and make a great effort in order that they “may be worthy of their great heritage.

Progress reported.

page 1130


The following paper was presented : -

Repatriation Act - No. 1 War Pensions Entitlement Appeal Tribunal - Report for year 1950-51.

House adjourned at 10.25 p.m.

page 1131


The following answers to questions were circulated: -


National Service.

Mr Holt:

– The answer to the honor> able member’s question is as follows: -

Under the National Service Act there is power to direct that a period or part of a period of national service training served by an apprentice shall be regarded as a period^ of employment under his contract of apprenticeship. ‘ It is proposed that this power shall be delegated to the apprenticeship authorities constituted under the laws of the States relating to apprenticeship and the concurrence of the governments of the States in this arrangement is being sought. Under the proposed arrangement, .it will be for the apprenticeship authority to decide whether, in effect, the term of the indenture should be shortened by reason of trade experience or training gained by the apprentice while performing his national service. Similar powers were exercised by the apprenticeship authorities under the Be-establishment and Employment Act 1845 in relation to apprentices returning from service in the last war. Every effort is made to ensure that trainees possessing civilian trade skills are posted to positions in the services in which their skills will be utilized, but this is obviously not possible in all cases. For all trainees, part of the period must be devoted to basic service training.




Mr Joshua:

a asked the Minister representing the Minister for National Development, upon notice : - “Will the Minister inform the House when he expects to be able to table the report of the Joint Coal Board for 1950-51?

Mr Casey:
Minister for External Affairs · LP

– The Minister for National Development has supplied the following information: -

Thereport - of the Joint Coal Board for 1950-51 will be tabled in Parliament assoon as practicable after the report is received from the board. The chairman of the board informs me that he expects to have the report in. the hands of the Government no later than the end of November.

Murray Valley

Mr Fairbairn:

n asked the Minister representing the Minister for National Development, upon notice: -

When is it expected that the report on Murray Valley resources will be published?

Mr Casey:

– The Minister for National Development has supplied the following information : -

The report on Murray Valley resources has been available for some time in roneoed form. It is expected that the printed edition Will be released early next year.

Cite as: Australia, House of Representatives, Debates, 24 October 1951, viewed 22 October 2017, <>.