House of Representatives
11 September 1957

22nd Parliament · 2nd Session

Mr. SPEAKER (Hon. John McLeay) took the chair at 2.30 p.m., and read prayers.

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Mr. BRYANT presented a petition from 3,151 citizens of Australia praying that immediate consideration be given to the matter of increasing the rates of age, invalid and widows’ pensions to at least 50 per cent, of the basic wage.

Petition received and read.

Petitions praying that pension rates be increased to 50 per cent, of the basic wage were presented as follows: -

By Mr. GEORGE LAWSON from 2,668 citizens of Australia.

By Mr. COUTTS from 3,082 citizens of Australia.

Petitions received.

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– In the unavoidable absence of the Prime Minister, who is at present administering the Department of External Affairs, I direct to the Treasurer a question relating to the sub-committee of the United Nations Disarmament Commission that met in London for some considerable time, but the work of which has been suspended, apparently because of a breakdown in negotiations. Will the Government urgently consider supporting the proposal of the Prime Minister of India that the Disarmament Commission be strengthened by the addition of representatives of other nations with a view to getting on with the job? T submit this as a question of urgency, because apparently the matter is coming before the United Nations very soon.


– I promise the Leader of the Opposition that I shall bring the question asked and the observations made by him before the notice of the Prime Minister.

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– I direct a question to the Minister for Primary Industry. I refer to the inquiry that was held by the Tariff

Board into the importation of passionfruit juice and pulp in the last quarter of .1956. So far that report has not been made public to the industry. I understand that the Tariff Board handed it to the Government some few months ago. I therefore ask the Minister, in the absence of the Minister for Trade, whether he will be good enough to see that the report is made available to the industry as soon as possible, so that the industry may gear its operations before the summer crop is harvested.

Minister for Primary Industry · LOWE, NEW SOUTH WALES · LP

– As the honorable gentleman will know, this matter comes within the jurisdiction and the administration of my colleague, the Minister for Trade. As soon as he returns to Canberra this afternoon, i shall discuss the matter with him and ascertain whether it is practicable to release the report.

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– I direct to the Treasurer a question concerning sales tax and the reductions of sales tax announced in the budget. As a preface to my remarks, I should like to read a short extract from a letter which a firm of wholesalers in Melbourne has sent to a firm of retailers. This is the quotation -

For the past few years despite steadily increasing manufacturing costs, we have maintained the list price at its present level. However, it was becoming apparent that an increase would be necessary in the near future. The reduction of sales tax from 10 per cent, to 8i per cent, makes it possible to increase slightly the wholesale net price without alteration to the present retail price or your margin of profit. The amount involved will partly compensate for increased price and will provide some relief and enable us to continue to actively promote and create demands for our product.

That means that the benefit of the sales tax reduction is not to be passed on. Will the Treasurer make an investigation in order to discover just how widespread is this policy of not passing on the benefit of sales tax reductions? Will he say whether there is any provision in the law by which a wholesaler can be compelled to give to the retailers the benefit of any sales tax remission, so that it can be passed on to the general public? I should like to mention that one refrigerator manufacturing company in Melbourne has passed on the benefit of the reduction, but most have not. I am told that nearly all makes of washing machines will remain at pre-budget prices.


– The question asked by the Deputy Leader of the Opposition is very timely. I appreciate it, because I have received several complaints along the same lines-. 1 shall have the whole matter investigated and let him know the result.

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– I direct a question to the Minister for Immigration. Is there any truth in the allegations that hardship is being suffered by Hungarian immigrants? What is done by the Minister’s department to assist them to become integrated in the community, and have any steps taken been successful?

Minister for Immigration · DENISON, TASMANIA · LP

– It would take quite some time to reply fully and in detail to the honorable member.


– I wish to take a point of order. My recollection is that there is a question on the notice-paper dealing with this subject.


– There is such a question on the notice-paper. This question is, therefore, out of order.

Dr Evatt:

– Does the question on the notice-paper refer to the specific subjectmatter raised by the honorable member, particularly the first part of his question? If it does not, I submit that the question is in order.


– Order! The question on the notice-paper relates to the same subjectmatter as that raised by the honorable member.

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– My question is directed to the Minister for Primary Industry. In view of the serious economic condition of the egg industry, is the Minister prepared to grant relief to poultry farmers by making wheat available to them at reduced prices, as was done several years ago?


– I think I have already informed the House of the active steps now being taken by egg boards, particularly the Australian Egg Board, to increase the sales of shell eggs and egg pulp, not only in Australia but also on international markets. In my view, that is the proper way to approach the difficulties of the egg industry, and I hope that an active marketing programme will be pursued. The honorable gentleman may know that a little more than a month ago representatives of the Egg Producers Council and the poultry growers interviewed me. In one of the arguments put to me by representatives of the council, they stated, quite explicitly that they did not think, a reduction in the price of feed wheat was the solution to the industry’s problems. They put forward logical reasons and arguments for thinking that a reduction in the price of feed wheat was not a satisfactory method of approaching the problem. I will get the reasons of the industry leaders and convey them to the honorable gentleman.

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– Has the Treasurer any information to give to the House in relation to any proposed review of procedures adopted by and the general functioning of the Tariff Board? If he has not, will he consider an early announcement by the Government in relation to this matter?


– The subjectmatter raised by the honorable member does not come within my jurisdiction. I know that my colleague, the Minister for Trade, has under consideration a review of the functions and jurisdiction of the Tariff Board.

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– My question is directed to the Minister for Health. I should like him, if he could, to clear up statements that I have read in the press in connexion with increases in hospital benefits. The Treasurer stated that, where people contribute to hospital insurance for a benefit of 16s. or more, an additional 8s. will be paid by the Government to the hospital. As a patient must now contribute for £2 2s. a week or 6s. a day to be able to receive a hospital benefit of 4s., in addition to the first 8s., does it mean that, to receive the extra 8s., he must contribute for an additional 10s. a day, making a contribution for 16s. a day?


– I think the simplest way for me to answer this question is to explain the avenues through which the Commonwealth makes payment to hospitals. There are two avenues. The first is by an agreement between the Commonwealth and the State governments by which the Commonwealth makes available 8s. a day for each occupied bed, a condition being that where a charge is made to the occupant of the bed his account shall be rebated by the 8s., that is to say, the patient has 8s. deducted from the account. That 8s. is known as the Commonwealth benefit. The second avenue is by the payment of what is known as Commonwealth additional benefit. That is a payment to persons who insure themselves in hospital benefit organizations, and is an amount of 4s. a day. At present, it is necessary for a person to insure himself with a benefit organization for an organization benefit of 6s. a day in order to attract the Commonwealth benefit of 4s. a day. Therefore, a total benefit of 10s. a day costs him 6d. a week.

The Treasurer announced in his budget speech that the present additional Commonwealth benefit of 4s. a day will be increased to 12s. a day, and this will attract an organization benefit of at least 16s. a day. For this, the insuree will pay ls. 6d. a week. There is no question of any one having to pay 16s. a week, as the honorable member for Port Adelaide suggested. In order to obtain total benefits of 28s. a day, the insured person will have to pay ls. 6d. a week. In addition, of course, a patient’s hospital account is reduced by the amount of 8s. a day paid by the Commonwealth under the agreement with the States. The National Health Act will have to be amended in order to give effect to the proposed increase in the additional hospital benefit, because it is not governed by the agreement with the States.

Mr Thompson:

– But people will have to pay the contributions appropriate to a fund benefit of 16s. a day?


– They will have to pay the contributions appropriate to a fund benefit of at least 16s. a day. Of course, some funds already pay benefits of more than 16s. a day, and may continue to do so. These two tables will be available as alternatives when the act is amended, so that an insuree will be able to elect to insure himself for a Commonwealth benefit of either 4s. or 12s. a day.

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– Has the PostmasterGeneral seen a report by the Commonwealth Scientific and Industrial Research Organization that the diameter of telephone poles could be reduced considerably, thereby saving large sums of money, particularly on lines in country areas, by making it possible for telephone lines to be extended over greater distances?


– They have to reduce the circumference of the poles.


– Can the Minister give the House any information about the report by the C.S.I.R.O.?

Postmaster-General · DAWSON, QUEENSLAND · CP

– The question introduces a subject that has been under consideration by the Postmaster-General’s Department and by State authorities that use considerable numbers of poles. It is not solely a question of the circumference of the poles, as the honorable member for the Australian Capital Territory suggested by interjection.

Sir Arthur Fadden:

– Or of the length of the poles.


– Or of the length. The problem has been to obtain poles strong enough to carry a considerable weight of telephone lines or other lines. As scientific knowledge increased, it was found that smaller poles could be treated with certain preservatives in order to make them last longer and retain their strength better. As a result, it was considered that careful scientific investigation of the problem might achieve good results, and a committee known as the Pole Research Joint Committee was formed. It is composed of representatives of the Electricity Commission of Victoria, electricity supply authorities in other States, the C.S.I.R.O., and the Postmaster-General’s Department. The investigations of that committee were made the subject of a press statement, which I saw and inquired into, and which led the honorable member for Canning to raise the matter.

It was found that the investigations undertaken by the committee required more money than was available from normal sources, and approximately £18,000 has been provided in recent years, of which the Postmaster-General’s Department contributed £7,000. I do not know what individual contributions were made by the other bodies represented on the committee, but no doubt they are comparable with that of the Commonwealth department. The committee’s investigations are not yet complete, but they indicate that, eventually, the circumference, or diameter - whichever term one likes to use - of poles may be reduced. This would result in considerable savings in the work, not only of the PostmasterGeneral’s Department, but also of other bodies that use large numbers of poles.

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– Will the Minister for Health consider the inclusion of tranquillizing drugs in the free list of pharmaceutical benefits available to age and invalid pensioners? Various medical authorities have asserted that these drugs are of great benefit to persons who are suffering from serious heart complaints.


– I think it is a pity that this term “ tranquillizing drugs “ should have received such publicity as it has in the press recently. Actually, it is a term which has almost any meaning you like to give it. All sorts of drugs which could be described as tranquillizing drugs are now available without cost to the whole community. Any particular drugs which it is thought should be added to the list of pharmaceutical benefits or to the pensioners’ list of special benefits will, of course, be considered, but, as I pointed out in the House yesterday, pensioners already have available to them all the pharmaceutical benefits, all the drugs on the special pharmaceutical list for pensioners and all the drugs in the British Pharmacopoeia.

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– I preface a question to the Minister for Territories by stating that I believe that the Premier of Western Australia recently sought in writing the cooperation of the Commonwealth in a survey of some 250,000 square miles of land close to Hall’s Creek and the Balgo Hills Mission. Will the Minister indicate the type of survey assistance that has been requested, and will it be possible for the Commonwealth to provide some helpful assistance along those lines?

Minister for Territories · CURTIN, WESTERN AUSTRALIA · LP

- Mr. Speaker, I have no knowledge of any request of the exact kind that the honorable member has mentioned. The Minister for Native Welfare in Western Australia has informed me that, later this year, the Department of Native Welfare and the Lands Department of Western Australia propose to send a survey party to the region of Lake Macdonald, which is considerably south of the area mentioned by the honorable member for Swan. The Minister inquired whether or not that survey party might be able to cooperate with native welfare parties working in the Northern Territory. I have replied to the Minister saying that, subject to the opinion of the Administrator of the Northern Territory, I think it may be possible to extend such co-operation. In view of the form in which the question was asked and some of the recent publicity that has surrounded these matters, I think I should hasten to correct any possible false impression that this is anything other than a purely routine matter.

Perhaps I can explain to the House the situation if I say that in that unsettled part right on the western edge of the Northern Territory near the Western Australian border, we have three government settlements - one at Hooker Creek, one at Yuendumu and one at Haast’s Bluff. These settlements were established with the intention that they would keep in touch with those people in the desert areas and provide schools for children, and so on. As an extension of the work of the settlements, patrols are conducted westwards. In June of this year, a patrol led by Mr. Evans went out westwards from Yuendumu to the Western Australian border and investigated the situation between Lake Mackay and Lake Hazlett. The patrol found there a total of about 150 aborigines. They all were in good condition from the point of view of nutrition and health. They were living in a country which, from a pastoral point ot view, was very hungry, which had very little surface water, but which did have native foods in good quantity. As a continuation of that kind of work, it is probable, although it has not been definitely planned as yet, that in October or November another routine patrol will go west from Haast’s Bluff to Lake Macdonald, which is just over the Western Australian border, and I anticipate that there will be no difficulty in planning our routine patrol to fit in with the survey party from Western Australia.

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– Is the Treasurer aware that the maximum advance available for a war service home remains at £2,750? Does he know that the average cost of a home built under the group scheme has increased to £3,500, requiring a deposit, in many instances, as high as £750, and that this has had the effect of compelling some 40 per cent, of applicants for group home assistance to withdraw their applications when assistance has been offered to them? In the circumstances, will the Treasurer consider raising the maximum advance to at least £3,000, in order to allow a higher percentage of applicants to become homeowners?


– The honorable member has asked a very pertinent question, but I should like to remind him and the House that this Government was elected on a mandate from the people not to interfere with the administration of the Commonwealth Bank Board, which was set up to carry out the administration of credit policy.

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– Can the Minister representing the Minister in charge of the Commonwealth Scientific and Industrial Research Organization say whether developments in the field of rainmaking are sufficiently advanced for the C.S.I.R.O. to assist farmers in areas where semidrought conditions are now being experienced, including the southern part of Tasmania?


– I think that honorable members know that what has been done so far in this field has been to conduct a series of experiments in selected areas of Australia. I think the word “ experiments “ should be stressed, because it is the operative word at this stage of the proceedings. It would be rash, I think, to build hopes unduly on the outcome of these experiments, or to imagine that we are at the stage at which rain can be produced in areas where rainfall potentialities do not exist, in the form of thick cumulus cloud or other physical condition appropriate for the kind of seeding operation that has been conducted from aircraft. This is, of course, a complicated question in many ways, but at this point no one could claim that we have done more than experiment on a limited scale. Whether an extension of these experiments would be warranted is now being examined by the C.S.I.R.O., and its officers have been discussing the matter with me. At present the aircraft and the personnel available are fully engaged on the experimental campaign already decided upon, but having received so many requests in recent times from various parts of Australia for the extension of these experiments, I have taken up with my colleague, the Minister for Air, the question whether additional aircraft could be made available. I understand that a limited number of aircraft could be made available, but a further limiting factor is the availability of trained personnel capable of doing this work. 1 hope that to-morrow I shall have a talk with one of the senior officers of the C.S.I.R.O., to see if these investigations can be carried a stage further. I repeat, in conclusion, that it would be most unwise to buoy up hopes at the moment that rain can be produced in any great quantity as a result of these experiments.

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– My question is directed to the Treasurer. My attention has been drawn to a statement by the right honorable gentleman in reply to criticism by the secretary of the Victorian Taxpayers Association wherein the Treasurer said -

We raised every penny we could on loans within Australia and overseas, but the demands on our fast-growing development projects ran ahead of the amount we could raise on a highly competitive loan market. We had to get money from revenue.

In view of the right honorable gentleman’s statement that the Government could not raise further loans within Australia or overseas, I ask him whether that statement is an admission that Australian and overseas investors have lost confidence in the Government and will not make any further advances to it.


– Confidence has been not only sustained but also increased in Australia’s economic policy by virtue of certain loans that we have been able to raise overseas. Those include loans raised in countries in which previous governments were not able to raise loans, namely, Switzerland and Canada. In addition, this Government has raised more loan money in Australia than any previous government has ever raised, despite the socialistic policy of Labour governments, which diverted money that was available for other purposes into Commonwealth loans during the war.

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– I ask the Minister for Labour and National Service whether he has seen a recent report by a former official of the United Nations Organization in which he said that the International Labour Organization was an ineffective body. Does the Minister share this view? In what way will future delegates from Australia to the International Labour Organization conferences be instructed?


– No doubt, differing views are held as to the value and effectiveness of the International Labour Organization; but having had so recent an experience of its operation at its latest conference, I have no reservation in my mind that it is a valuable and effective body and should be supported by this Parliament. Australia has been a foundation member of the organization since 1919, and Australian governments of all political persuasions have continued their support and their representation at its conferences. I believe that Australia, a country of high industrial standards and with a high wage structure, has a special interest in assisting to raise industrial standards in other countries. As they raise their standards, we are enabled to improve ours still further. I believe, also, that the I.L.O. is a valuable instrument for the spread of social justice throughout the world and that, in itself, is a contribution to the peace that we are all seeking to maintain.


– By way of a supplementary question, I ask: In view of the opinion which the right honorable gentleman has just expressed, favorable to the International Labour Organization, will he undertake to bring before this House, for ratification and adoption, the recommendations and conventions agreed to by that international body, this Government having brought none of those matters to this House during its term of office?


– I shall give consideration to the question put by the Leader of the Opposition. I do not know whether he is implying in his question and the manner of its presentation that this Government has acted in any way to depress industrial standards in Australia. On the contrary, the industrial standards of the Australian wage-earner and trade unionist have never been higher in the history of Australia than they have been during the term of office of this Government.

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– I ask the Treasurer whether the Government has considered the impact of the ls. a gallon tax on diesel oil on the logging industry - a basic factor in home-building - and also its impact on all primary products by increasing the cost of running machinery used by sugargrowers, wheat-growers, dairymen and those engaged in all forms of primary production. Will the Treasurer give consideration to this aspect of the tax and discuss the matter with the Minister for Primary Industry?


– I am sorry that my old boxing tutor is off the mark in this matter. He has founded his question on a wrong premise. As a matter of fact, the imposition of the diesel oil tax of ls. a gallon is to be confined entirely to road users. All others are exempt. If there is any disputation over the distribution of the proceeds of the Commonwealth’s generosity to the States, it will be a matter of disputation as between the consumers of diesel oil and the States concerned.

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– I ask a question of the Treasurer concerning the private savings banks. The right honorable gentleman will recollect that, in the autumn sessional period, I put three questions on the noticepaper in the quest for information on the deposits and investments of the banks. He will also recollect that he told me that some technical difficulties had to be resolved before any questions could be answered, and that the form in which information on this subject might be published was under consideration. I now ask the right honorable gentleman whether these difficulties have been resolved, and whether it is possible for honorable members, and the general public, to have access to statistics from which they can regularly ascertain for themselves whether the banks are abiding by the spirit and the letter of the licences which he granted to them early last year. In particular, is it possible for the public, and us, to find out what percentage of their deposits has been translated into dwelling houses and municipal works and what portion has been deposited with their parent banks?


– Following upon what I said about my old boxing tutor, may I say that I anticipated this question? As the best form of defence is attack, I have a considered reply to the question that I anticipated the honorable member would ask. The question of publication of suitable statistical information concerning the operations of savings banks is one of the matters which is receiving attention in connexion with the preparation of amending banking legislation. The honorable member will appreciate that I am not in a position, at this stage, to reveal the details of the Government’s proposals on the matter, but I think he will find that the proposals will meet objectives of the kind he has in mind.

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– I address a question to the Minister for Defence. In view of the Minister’s rejection of the United States Starfighters for Australia’s defence, can he say whether the United States is producing any other defence units or equipment which will measure up to the standards set by him or the department? If America is doing so, has the Minister succeeded in obtaining such units or equipment for Australian defence requirements, and when will they be delivered? In any event, will he state what action has been taken to get suitable defence units and equipment from any other sources?

Minister for Defence · WAKEFIELD, SOUTH AUSTRALIA · LP

– As I have mentioned in the House, several statements have been made to the effect that, after due consideration, we had decided not to go ahead with the purchase or manufacture of the F104 aircraft.


– Were they not any good?


– Not for the role which we intended for them. It is all a question of the role that we expect to undertake in the South-East Asian area. I also mention the fact that, at the moment, the United States is developing a fighter which, if it comes to maturity, will probably meet the needs of our own Air Force. At the present time we are suspending judgment on the introduction of a new fighter. The probability is that we will continue the manufacture of the Sabre in numbers to keep the R.A.A.F. properly equipped.

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– I ask a question of the Minister for Air. I desire to know whether it is a fact that the Minister made a statement to the effect that the Government had had to reconsider earlier advice on re-equipping the Royal Australian Air Force with American F.104 supersonic Starfighters, because this type of fighter aeroplane was designed for a specialized task which did not fit in with the role of the Royal Australian Air Force. If so, will the Minister state who were his advisers in the first instance who recommended the Starfighter aeroplane, and whether they are also his present advisers who now discover that this make of aeroplane is unsuitable? If the Minister has changed his advisers, will he state what has happened to those who previously so grievously misled him? Were they dismissed, transferred or demoted? Finally, were the advisers concerned ignorant of the role of the Royal Australian Air Force at the time they tendered the wrong advice referred to, and if so, why had he failed to tell them - that is, of course, if he really knew?

Minister for Air · EVANS, NEW SOUTH WALES · LP

– In the statement already on record the matters referred to by the honorable member are dealt with at greater length than is permissible at question-time.

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– My question is directed to the Minister for Immigration. In view of a statement made by a spokesman for the Country-Liberal Government of Queensland to the effect that Commonwealth Government approval will be sought to bring 200 Japanese divers to North Queensland to work in the pearl-fishing industry, will the Minister give an assurance that the Government will refuse such approval?


– No report of the statement that is alleged to have been made has come to my notice, but I will make inquiries about it.

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– Following certain questions asked by honorable members regarding the lighter aircraft known as the Starfighter, 1 desire to ask the Minister for Defence whether his attention has been drawn to a statement by an Imperial Government spokesman that Britain has developed three aircraft, one a fighterinterceptor, one a fighter-bomber, and the other a bomber-research plane, capable of speeds of over 2,000 miles per hour. Have these facts anything to do with the Minister’s decision or the decision of the Government to refrain from entering into commitments in the United States of America?


– I can assure the honorable member that this Government is completely advised of all the developments taking place in the United States and the United Kingdom. On my visit to the United Kingdom I actually saw the P.l aircraft, which is Britain’s latest fighter, in operation. This Government is watching very closely the development of fighters in the future and it has no commitments in regard to fighters in either the United Kingdom or the Unite: States.

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Message recommending appropriation reported.

In committee (Consideration of GovernorGeneral’s message):

Motion (by Sir Arthur Fadden) agreed to -

That it is expedient that an appropriation of revenue be made for the purposes of a bill for an act to amend the Western Australia Grant (Water Supply) Act 19-!8-1955.

Resolution reported.

Standing Orders suspended; resolution adopted.

Ordered -

That Sir Arthur Fadden and Mr. Harold Holt do prepare and bring in a bill to carry out the foregoing resolution.

Bill presented by Sir Arthur Fadden, and read a first time.

Second Reading

McPhersonTreasurer · CP

– I move -

That the bill be now read a second time.

This bill deals with Commonwealth payments towards the cost of the agricultural areas, Great Southern towns and gold-fields water supply scheme in Western Australia. This scheme is more commonly referred to as the comprehensive water supply scheme. It involves the reticulation of water to townships and homesteads in a wheat belt area of about 4,000,000 acres inland from Perth, the reticulation of water to towns along the Great Southern railway from Beverley to Katanning, and increasing the supply of water to the eastern gold-fields area of the State.

The bill has two purposes. One is to increase from £4,000,000 to £5,000,000 the aggregate limit on the Commonwealth payments towards the cost of the scheme. The other purpose is to remove the limits on the amounts payable by the Commonwealth in the financial years 1957-58 and 1958-59.

Under the Western Australia Grant (Water Supply) Act 1948-1955 aggregate payments of up to £4,000,000 may be made by the Commonwealth on the basis of half the expenditure incurred by the Slate on the scheme. It is, however, provided in the act that the Commonwealth payments shall not exceed £3,075,000 by 30th June, 1958, and £3,537,500 by 30th June, 1959.

The Commonwealth first decided in 1948 to contribute towards the cost of the scheme. The government of the day then agreed, at the request of the Premier of Western Australia, to meet, on a £l-for-£l basis with the State, one-half of the capital cost of the scheme, subject to a maximum Commonwealth contribution of £2,150,000. At that time, the State’s estimate of the total cost of the scheme was £4,300,000.

In 1955, however, the Government of Western Australia asked the Commonwealth to remove the limit of £2,150,000 on its payments. The Premier indicated that, although delay had occurred through inability to obtain the required materials, and the cost of the scheme had risen considerably, every effort would be made to complete the work by June, 1960. Following these representations, it was agreed to raise the aggregate limit on the Commonwealth payments from £2,150,000 to £4,000,000, an increase of £1,850,000. It “was intended that the additional amount be spread over the four financial years from 1956-57 to 1959-60. That meant that the Commonwealth payments in any one of those years would not normally exceed £462,500. The act was amended accordingly in 1955.

The bill now before the House provides that, within the appropriation of £5,000,000, the Commonwealth may reimburse the State half its expenditure on the scheme. There will be no limit on the amount payable by the Commonwealth in any one year. In brief, this measure is designed to assist the State of Western Australia on an increased scale in financing the cost of the comprehensive water supply scheme.

Debate (on motion by Mr. Calwell) adjourned.

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Motion (by Mr. Harold Holt) - agreed to -

That Government business shall take precedence over general business lo-morrow.

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BUDGET 1957-58

In Committee of Supply: Consideration resumed from 10th September (vide page 489), on motion by Sir Arthur Fadden -

That the first item in the Estimates under Division No. 1 - The Senate - namely, “Salaries and allowances, £30,000 “, be agreed to.

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

That the first item be reduced by £1.


.- I desire to add my congratulations to those which have already been offered to the Treasurer (Sir Arthur Fadden) upon his presenting to this House his tenth budget. The budget, this year, has been presented under very much happier circumstances for the Treasurer than those associated with the presentation of some of his preceding budgets. In those budgets he pointed out the difficulties under which the national economy was labouring. On this occasion, he has been able to assure us that the economy is stable. That statement, of course, was extremely re-assuring, and was not made less re-assuring by the speech made by the right honorable the Leader of the Opposition (Dr. Evatt). It is true that the Leader of the Opposition endeavoured to paint a sorry picture of the national economy, but he so confused himself with the many figures that he produced that he was far from producing the effect he sought. It may be that he was able to delude himself, but I doubt that he was able to delude anybody else into thinking that the national economy was “ running down “, as he expressed it.

Whether it was the Treasurer or the Leader of the Oposition who was correct might be said to depend on a party point of view, but people who move in the community, and who know the general state of prosperity, can hardly be expected to accept the view put forward by the Leader of the Opposition. If one wants to get an independent view on these matters, one should look at the annual report of the Australian Tariff Board, which has just been issued. If one looks at that, one will see that the Tariff Board has stated that, as a result of conditions during the last twelve months, the national economy is now in a state of stability. The Treasurer was careful to point out in the course of his speech that, whilst we are in a state of stability, we need to observe the utmost caution. We have to retain that stability.

If one examines the language in which the Tariff Board’s report is cast, one sees that the Tariff Board is of the same opinion. It Considers that whilst the nation is, generally speaking, in a state of prosperity and economic stability, nevertheless, it is a time for caution. In those circumstances, the budget that was produced by the Treasurer in this instance is the kind of budget that should be produced, because it endeavours to conserve the existing position. Above all things, having regard to the fact that we have been going through a time of great inflationary stress, and of trouble with our overseas balances, it is essential that we should endeavour to retain what we have on this occasion established.

It is true that the Leader of the Opposition also criticized some of the methods that the Government had used in order to establish stability. I meet his criticism of those methods by asking what has happened in other countries. Countries such as the United Kingdom, New Zealand, and the countries of Western Europe, have had inflationary troubles similar to those of Australia. In each instance, in order fo meet the problems that existed, they have had to adopt many of the expedients which the Australian Government has had to adopt. It is true, nowadays, that however much a government may believe in private enterprise and dislike controls, it has the responsibility of giving a very substantial direction to the economy. Therefore, if we look to the countries of Western Europe, the United Kingdom or New Zealand, we see that the same sort of action has been taken in those countries as has been taken here.

If we glance at our nearest neighbour, New Zealand, we shall see that there were no taxation concessions in that country’s budget last year. In that country, depreciation allowances were cut out, hire purchase was controlled, and credit restrictions and import restrictions were imposed, even to the extent of limiting the commencement of new businesses. In other words, all kinds of action that were felt to be necessary in the circumstances were taken. Therefore, I say in answer to the Leader of the Opposition, that what was done in this country has been done elsewhere. The action was legitimate in the circumstances, and the proof of its efficacy lies in the fact that it has re-established the stability of the economy.

I have already joined issue with the Leader of the Opposition with regard to whether or not the economy has been put on a stable basis, and I have quoted the Tariff Board’s report on that matter. Whilst the Treasurer has been able to make some taxation concessions, he has been confronted with the need, not only to maintain stability and meet the great loan redemption sums amounting to millions of pounds that will have to be met within a short time, but also to make provision for the States. That is an obligation that involves the raising of many millions of pounds. Therefore, this is not a time for great taxation concessions, and it is not a time when the Government is able to give more than what it has, in fact, given to the pensioner.

It is not without interest that, in the report that was given so much publicity earlier this year, the Downing Report, the suggested pension increase was 7s. 6d. a week. That is the amount that the Government has now given. Professor Downing, it is very true, made a number of other recommendations, but he intended that they should be given effect in the long term, and not as by a stroke of the pen - in an instant. A further recommendation to which the Government has been able to give effect is that concerning homes for the aged. In future the Government’s grant shall be £2 for every £1 raised from other sources. Honorable members will see that it has gone as far as it can under the present circumstances to provide homes for old people.

The Government will continue to promote its policy of greater population, higher living standards, full employment, industrial expansion and national development. These aims have all been achieved, and the Government will maintain its present high standard of progress in these fields. First, it will, this year, maintain its standard target of 1 15,000 immigrants annually. I refer to immigration at this stage because of what was said by the honorable member for Hindmarsh (Mr. Clyde Cameron) last night. In his speech there were no flowers by the wayside, and he endeavoured to obscure the barrenness of his ideas by a mirage of fury. I assure him that the Government’s immigration policy is well founded, and the product of a tremendous amount of thought and experience. The claims of each nationality, and the incidence of skill, semiskill or lack of skill, have to be considered. The possible stresses and strains on the community must be kept in mind, and employment trends must be observed.

The complexity of these matters makes it necessary that the Government should have at its disposal a host of well-informed and able advisers. First, there are the two advisory councils - the Commonwealth Immigration Advisory Council and the Commonwealth Immigration Planning Council. They comprise citizens of ability, knowledge and experience, who are chosen from industry, commerce, ex-servicemen’s organizations, women’s groups and so on. They are fortified by the wisdom and experience of the Good Neighbour movement, and the advice of the Department of Labour and National Service. They have also the assistance of the State Ministers for Immigration and, of course, the very experienced officers of the Commonwealth Department of Immigration. That great body of knowledge, experience and wisdom exists for the purpose of planning our immigration policy, and the tremendous success of that policy since the war has been attributable to its existence.

Some people imagine that all we should look for in a migrant is a high degree of skill. That, of course, is not true. Many jobs need the services of semi-skilled and unskilled persons. I have in mind some of the work of the Snowy Mountains Hydroelectric Authority, and such tasks as railway maintenance and seasonal fruit picking. It is clear that each of those occupations has room for people who do not enjoy a high degree of skill. In short, we need among our immigrants persons from all three categories - skilled, semi-skilled and unskilled.

Coming now to the question of nationality, I may say that there seems to be a widespread impression that southern Europeans predominate. That, of course, is equally untrue. Not more than 11 per cent, of assisted immigrants come from southern Europe, including Malta. On the other hand, 80 per cent, of all immigrants - assisted and unassisted - come from the United Kingdom and the countries of northern Europe. At the moment the question of British immigration is being widely canvassed. I point out that the Government offers far more generous assistance to the British immigrant than to the immigrant from any other country. The passage of the British adult immigrant is assisted to the amount of £142 10s.; he has to find only £12 10s. himself. That tremendous degree of assistance is three or four times as great as is given to immigrants from any other country.

During the last twelve months 24,000 assisted immigrants have come from Britain, and fewer than 10,000 from any other country. The Government has seen to it that every available passage from the United Kingdom is made available to British immigrants. In addition, it thas chartered the “ Fairsea “ so that it may be used solely for the carriage of British immigrants. Indeed, the Government is at present endeavouring to negotiate the charter, for the same purpose, of yet another ship.

A further advantage enjoyed by British immigrants is that they are able to take their families with them into the hostels. Immigrants from Continental countries Have often to face separation from their families, because suitable living accommodation is not available. Therefore, the lot of th?

British immigrant is very much better than that of the immigrant from Continental countries.

Every effort has been made by the Minister and his department to bring more British people to this country. Recently, the “ Bring out a Briton “ campaign was commenced. Our greatest need is accommodation for immigrants, and this personal appeal was made so that every bit of spare accommodation could be offered to British immigrants. I may say that so far the campaign has been very successful. In the first six months of this year 16,000 British nominations have been received. This is 6,000, or 60 per cent., more than were received during the same period last year. I have mentioned these facts in order to demonstrate the Government’s determination to give first preference to British immigrants.

I pass now to matters relating to industry and employment. I might mention first the concessions that have recently been made by the Government in company tax and depreciation allowances. Both of those should be very valuable to industry. I rather regret that the Government has not seen fit to remove the undistributed profits tax imposed on proprietary companies, a tax which prevents those companies from ploughing back their profits and thus expanding their enterprises, but the concessions which have been given will undoubtedly help industry and, by helping industry, will help to improve the employment situation.

The Government has also made in the budget certain provision with regard to housing, railways and roads, the effect of which will be greatly to improve employment. The Government recently established a special committee to consider roads, and the budget indicates that there will be a general reconsideration of our roads policy. Undoubtedly the time has arrived when this country is entitled to a new national roads policy, and from what appears in the budget it seems that it is the intention of the Government to formulate such a new policy. In that connexion, we must recall that at present Victoria contributes 31 per cent, of the petrol tax revenue but receives in return less than 18 per cent.

That is an extraordinary position. No one in Victoria denies that we must have national roads and that the poorer States must be helped, but that help should be within reason. The proportions I have mentioned show how completely unreasonable is the present allocation, and surely it cannot be allowed to continue.

While speaking of Victoria’s position in relation to this tax, let me also deal with Victoria’s financial position generally, because a part of the budget relates to tax reimbursement. I submit that this is the time to consider Victoria’s financial position, because the Victorian Government has just announced its budgetary provisions. The Victorian budgetary position is extremely difficult, and could even be said to be acute. That position has not been caused by any new policies or by wage increases. It is due simply to the pressure of population. Because of that pressure, Victoria requires new schools, hospitals and other essential governmental services. For example, this year 1 ,000 new teachers, 1 80 policemen and many more hospital nurses are required. The increase in population is due undoubtedly to the Commonwealth Government’s immigration policy, under which Victoria has received 40 per cent, of Australia’s immigrants. If Victoria were receiving 40 per cent, of the tax reimbursements or loan moneys, that would be fair enough, but Victoria’s share of tax reimbursements is only 26 per cent., and of loan funds, only 25 per cent.

The Minister for Labour and National Service (Mr. Harold Holt) issues figures which show that since 1948, for the whole of Australia, there have been increases of 433 per cent, in the amount provided for schools and of 400 per cent, in the amount provided for hospitals. He said that those figures proved that the Commonwealth grants for those purposes had been adequate. That may be so generally, but in Victoria the cost of schools has increased, not by 433 per cent., but by 700 per cent, and the cost of hospitals has increased, not by 400 per cent., but by 1,300 per cent. If one looks at general public works throughout the Commonwealth, it will be seen that in recent years expenditure for that purpose has gone down by 7 per cent., but Victoria’s position is, once more, worse. In Victoria, expenditure has gone down by 9 per cent., whilst the Commonwealth Government’s capital expenditure on its own public works has gone up - not down - by from 20 per cent, to 25 per cent. It will be seen from those figures that Victoria is in a very difficult position. Although Victoria has provided a considerable part of the national funds, it has received far less than it has provided.

Let me deal with one or two other matters. Hospitals in Victoria all have enormous overdrafts, but nothwithstanding those overdrafts they still find it difficult to pay their creditors, who have to wait for months for their money. Last year the Treasurer issued a public statement in which he condemned the various States because they did not discontinue automatic cost of living adjustment of wages. He said that by not doing so the States had landed themselves in financial troubles and that they should get out of those troubles as best they could. Victoria, at the request of the Treasurer, put an end to automatic cost of living adjustments, but it has had no additional assistance from the Commonwealth.

The matters to which I have been referring are of grave concern to all Victorian members of this Parliament, of whom there are many in this chamber. There may be, as one honorable member interjects to say, far too many of them, but let us hope that they will use their weight to bring about an adjustment of the condition of affairs about which I have spoken. I feel certain that every Victorian member and, what is more, every fair-minded member of this Parliament is satisfied that Victoria has not had a fair deal.


– In presenting the budget, the Treasurer (Sir Arthur Fadden) attempted to paint a picture of a stable economy, and the honorable member for Balaclava (Mr. Joske) complimented the Treasurer upon a budget which he thought would achieve stability in our economy. If that is the reaction of honorable members opposite to this budget, they are very easily satisfied. To my mind, it gives very little and perpetuates some of the things that this Government brought into being with what has become known as the “ horror “ budget. It is correct to describe this budget as a little horror budget. The honorable member for Balaclava, who preceded me in this debate, pointed to the alleged achievement of economic stability. He also congratulated the Government on its immigration achievements and he then directed his attention to the financial position of the States, particularly Victoria. Might I point out that the Government decided to reduce our intake of immigrants only after sustained agitation to that end by the Opposition. After the Opposition had pointed out that the number of people who were coming to this country was upsetting our economy, Government supporters cashed in on that contention, and denounced the Government’s policy. With the passage of time, the Government acknowledged the Opposition’s contention, and reduced the intake of immigrants. If the Government had stuck to its original figures, the position would have been quite all right. However, the agreed upon intake of 115,000 migrants was exceeded in 1956-57 by 6,000 migrants. I submit that that has added to this country’s difficulties.

The honorable member for Balaclava referred to the financial position of the States under the uniform taxation system, and he made a plea for greater reimbursements to Victoria. He outlined the difficulties under which that State is labouring. I think it can truly be said that other States, also, are confronted with similar difficulties. Perhaps the honorable member tempered his remarks somewhat in view of the fact that Victoria has a government of the same political outlook as his own. The things for which the honorable member made a plea on behalf of Victoria are those that have been the subject of attack by Government supporters on Labour governments in other States. If supporters of the Government wish their pleas for greater assistance to the States to be heeded, they should dismiss political considerations from their minds and concentrate on the needs of the States; they should not shroud the issue in politics.

The Government has seen fit to increase age and invalid pensions by 7s. 6d. a week. This meagre and inadequate increase will do little to alleviate the position of people who depend on their pensions for sustenance. I remind the Government that pensions were not increased last year. The pensioners were passed over last year, and now they are to receive only a meagre increase. It is interesting to observe that 82 per cent, of the recipients of age and invalid pensions are completely dependent upon their pensions for sustenance. As T have said, the Government omitted to do anything for the pensioners last year and 1 do not think the Government, by the meagre increase that is now proposed, has adequately discharged its responsibility to the aged and infirm members of the community.

Mr Turnbull:

– What did Labour promise the pensioners during the 1949 election campaign?


– 1 shall deal with the matter raised by the honorable member for Mallee as I proceed. I am pleased indeed to note that the Government has decided to increase its subsidy in relation to homes for the aged, so that in future the Government will provide a subsidy of £2 for every £1 found for this purpose by charitable organizations. Incidentally, 1 point out that if Labour had been returned to office at the last election the subsidy would have been increased immediately; the charitable organizations would not have had to wait two years for the subsidy to be increased. This was a part of Labour’s platform during the last election campaign, and the fact that there has been delay in this matter will not detract from the effectiveness of the increased subsidy. I take this opportunity to congratulate the organizations that are performing this meritorious work. I also take this opportunity to pay a tribute to the Reverend H. Hawkins, who is head of the Methodist Mission at Leichhardt, which is situated in my electorate. During the last twelve months, he has performed wonders in this field. He has been responsible for three projects to provide homes for aged people in that district, thus setting a worthy example to others who are interested in this activity. I commend both the Reverend Hawkins and his achievements to them.

I am very perturbed about the attitude of this Government to shipbuilding. In the Dalley electorate, there are some of the biggest shipbuilding yards in Australia. I regret to say, however, that due to a lack of orders for the construction of ships, the industry is facing an uncertain future. For reasons best known to itself, private enterprise apparently prefers to place orders for ships in overseas yards to patronizing the Australian shipbuilding yards. In consequence of the failure of private shipping interests to recognize their responsibilities in this matter, the future of the Australian shipbuilding industry is in jeopardy. I have directed the attention of honorable members to this subject on several occasions. If the industry is to survive, it must be assured of continuity of work. In consequence of the lack of orders for ships, the employment of a large number of people in my electorate is somewhat uncertain. I hope that the Government will take remedial action in this matter before it is too late.

Supporters of the Government have gone to extreme lengths in order to describe the budget in the most laudatory terms. I am unable to agree with their contention that it is a stable budget, having regard to some of the things that have happened during the last twelve months and the proposals that have been made in relation to the ensuing year. During the last twelve months, unemployment figures reached a record high, and to-day there is more unemployment in the country than at any time since 1952. When this state of affairs was brought to the notice of the Minister for Labour and National Service (Mr. Harold Holt) several weeks ago, he promised that the budget, when introduced, would provide an answer to the problem. I regret to say that I have looked through the budget iti vain for the promised answer. Furthermore, I am unable to reconcile some of the contradictory aspects of this budget with claims that have been made from time to time by Government members.

The first feature of the budget that impresses me is the fact that expenditure this year will exceed expenditure last year by £79,000,000, and it is expected that revenue in this financial year will be £107,000,000 greater than last year. It is noteworthy that the Treasurer (Sir Arthur Fadden) has not been able to present estimates to this chamber with any degree of accuracy. Year after year, as each budget has been brought down, it has been seen that the right honorable gentleman’s estimates in the previous year were hopelessly astray. In my opinion, over-estimating is almost as bad as underestimating. As the predictions of the Treasurer, in the form of the Estimates, have been consistently inaccurate, I think we are entitled to examine fully the Estimates that are presented to us from time to time.

Over the last three years, revenue has exceeded expenditure by £300,000,000. If the Estimates had been reasonably accurate, many things could have been accomplished with that amount of money. Social services benefits could have been increased, and taxation could have been reduced. But no! Neither of those things was done. All the Government does is to take pride in the fact that over the last three years it has had a surplus of £300,000,000. I submit that that in itself is an indictment of the Government for the manner in which it presents estimates of expenditure to this Parliament.

We have heard quite a lot about the generosity of the Government in granting taxation reductions, but the fact is that indirect taxation to-day - that is, sales tax, customs duty and excise - is at a higher rate than it was during the war. A short time ago, the honorable member for Mallee asked, by way of interjection, what had happened in 1949, and I suggest that perhaps he might care later on to explain what in fact did happen then. The Government proposes now to increase revenue by £107,000,000, and it is interesting to ascertain how this increase will be brought about. Although the Government claims that it has reduced taxation, the fact is that, in the ensuing year, it will receive approximately £71,000,000 more by way of taxes on individuals than it received last year. It will receive £3,800,000 more from the pay-roll tax, £6,500,000 more from sales tax, £6,400,000 more from company taxation, and £17,000,000 more from customs and excise.

Because the Government will receive an additional £71,000,000 from taxation on individuals, while the concessions that it proposes to make amount to only £56,000,000, the result will be a favorable balance of £15,000,000. The proposed reduction of the pay-roll tax will result in the Government losing £2,000,000 in 1957-58, but because the total revenue from sabs tax will be £3,800,000 more than it was last year, the Government will still be £1,800,000 better off in this respect. In effect, on its own figures, the Government could have doubled the reduction of the pay-roll tax. The proposed reductions of the sales tax will result in a loss to the Government of £4,000,000 a year, but total receipts from this tax will be £6,700,000 more than they were last year. There will be no generosity therefore in the proposed concessions, because total receipts will still exceed those of last year by more than £2,500,000. By way of company taxation, the Government expects to receive an additional £6,400,000 this year, whilst the concessions amount to £14,500,000. It is obvious, therefore, that those who will benefit most from the tax reductions are the companies.

I have referred to the forms of indirect taxation that obtain in this country, and I think it is true to say that it is almost impossible to calculate the total amount of taxes that a person pays yearly as the result of both direct and indirect taxation. Indirect taxation, of course, is very cunningly concealed. Let us take the case of a person receiving £16 a week in wages, or £832 per annum. He is liable for £75 by way of direct taxation. If he is a smoker and smokes a packet of cigarettes a day, he will pay £20 a year in indirect tax for his smokes; if he is an average beer-drinker and spends approximately 6s. a week on beer - no one could call him a spendthrift if he did - he will pay an additional £15 in indirect tax to the Government; if he owns a motor car and uses it at about the average rate, he will pay £25 a year in indirect tax on petrol. Therefore, a very rough calculation indicates that the total of indirect taxes that such a person will pay will almost equal the total of his direct taxes, although that by no means presents the picture in its proper perspective.

From time to time, supporters of the Government, particularly the Minister for Labour and National Service (Mr. Harold Holt), try to justify the attitude of the Government towards the ordinary people of the community. The Minister has argued that, because the average adult wage in Australia in 1955-56 was approximately £17 10s. a week, or £910 per annum, that indicated the stability of the economy and justified the continued existence of the Government. As I shall point out, such an argument is completely misleading. Take New South Wales as a case in point. We know that the basic wage there is £13 10s. a week, or £702 per annum. Incidentally, the intervention of this Government on the question of the suspension of quarterly cost of living adjustments has meant that those people who work under federal awards to-day are between 12s. and 16s. a week worse off than are those who work under State awards. The action of the Governnent in that respect cannot be condemned in sufficiently strong terms.

Let us see whether or not the argument of the Minister for Labour and National Service is correct by relating it to the numbers of taxpayers within the various income groups. The total number of taxpayers in Australia is 3,680,550. Those with incomes of between £100 to £700 per annum number 1,547,526, so that, in effect, more than one-third of the people who pay taxes receive less than £700 per annum. Those who receive £800 a year number 406,000, and those who receive £900 a year number 417,000, so that we find that of the total number of taxpayers, 2,370,526 do not receive more than £900 per annum. In effect, almost two-thirds of Australia’s taxpayers earn well below £900 a year. The Minister for Labour and National Service (Mr. Harold Holt) tries to make the point that because the average weekly wage in this country is £17.51 everybody is well off. The reality is that two-thirds of our taxpayers do not receive anything near £17 a week.

The Government has claimed that it has reduced taxes. Is that really the case? In 1956-57, Australians paid £7 3s. 1 Id. a head in customs duty, but under this budget they will pay £7 12s. Id. a head. In excise duty, in 1956-57, we paid £22 16s. Id. a head; we will now pay £23 13s. 7d. The per capita comparable figures in respect of other taxes paid in 1956-57 and those to be paid under the new budget are, respectively, as follows: - Sales tax, £13 3s. 9d. and £13 5s. 4d.; income tax on individuals, £42 6s. lOd. and £47 13s.; and company tax, £22 14s. 3d. and £21 10s. 4d. Company tax per head of population is the only tax reduced; so companies are beneficiaries under this budget. The incidence on the people of all other taxes is to be increased.

From time to time Government supporters contrast conditions in 1948-49 with conditions to-day, and, since they are so fond of doing so, it is well to examine the validity of their statements in that respect, how relevant they are to the truth and how much fact and politics they contain. In 1948-49. tax receipts totalled £580,000.000; in 1956-57 they totalled £1,273,000,000. In 1948-49 indirect taxes brought in £251,000,000; in 1956-57 the total was £633,000,000. So, the people are paying in indirect taxes almost treble the amount they paid in 1948-49, Again, in 1948-49 taxes on individuals yielded £198,000,000, whereas in 1956-57 the Government collected from individuals no less a sum than £404,000,000. In 1948-49, companies paid £74,000,000 in taxes, whilst in 1956-57 they paid £216,000,000. So, over the whole tax field, the people of Australia are paying more in taxes to-day than they have ever been called upon to pay.

The Government claims that it has made tax concessions, but an examination of the budget will prove that that is a misleading claim. According to its Estimates the Government proposes to increase this year’s revenue yield by £107,000,000 compared with last year’s yield. So I, for one, cannot accept the Government’s claim that it is making concessions to the taxpayers. The Government deliberately closes its eyes to some of the deleterious factors in our economy to-day and, because of its financial policy, permits to operate other factors which. 1 believe contribute to the present excessive high prices of consumer goods and services. When the Government allowed private trading banks to enter the savings bank field it gave an impetus to inflation. We predicted what would happen as a result of that action, and charged the Government with responsibility for the inevitable results; but the Government, as usual, declared the prediction was groundless. Let us look at some of the activities of the banks in respect of this particular matter. We find that last year bank deposits increased by £1 16,000,000, but, at the same time, their general advances decreased by £27,000,000. Five of the eight private trading banks to-day are heavily engaged in hire-purchase trading. Four years ago hirepurchase advances totalled £80,000,000; to-day, such advances total £230,000,000. In 1956-57, hire-purchase advances increased by £22,000,000 but, I emphasize, the banks’ general advances decreased by £27,000,000.

It is undeniable that the entry of the private trading banks into the hire-purchase field has wrought havoc in our economy. On the one hand they have used the savings of their depositors as ready cash to enable them to engage in hire-purchase trading. At the same time, they have curtailed their general advances by the figure that I have given, notwithstanding the fact that their deposits increased by £116,000,000. This is a responsibility that the Government cannot evade, and inasmuch as it has been responsible for permitting the private trading banks to enter the hire-purchase field it must accept the blame for the uncertainty, the havoc and the high prices that are features of the Australian economy.


.- I join with other honorable members in congratulating the Treasurer (Sir Arthur Fadden) on the introduction of his tenth budget. Eight of the budgets he has introduced have been consecutive. In the last eight years the Treasurer has been able to point to periods of great development and great progress. In the present budget he points to the operations of last year and shows that we in Australia have had record production, and a record volume and a record value of exports even excepting the wool boom year of 1950-51. The Treasurer also points to the Government’s record over that period of eight years of substantially full employment, rising prosperity and great development. In this budget he also places emphasis on the family unit. Our way of life, our free British democracy, is based upon the importance of the family unit. Therefore we, as members of this House, must be at all times vigilant to see that in imposing taxes we do not place too great a strain upon the family man.

In this budget, instead of making an allround reduction in the rate of income tax, the Treasurer has done what I believe to be the right thing by passing such income tax benefits as are available to those who have family responsibilities, by increasing the allowances for a spouse and a dependent child. I am also pleased to see that, for the first time, the benefit is to be given for adopted children as well as natural children.

The budget also places emphasis upon the importance of further development and the provision of further employment. So, we notice that such tax concessions as are available in that field are concessions which will provide additional employment and enable further development. The reduction of company tax will enable companies to plan for the future, to provide further employment, and to increase development. The reduction of pay-roll tax will permit a reduction of costs and will have the effect of exempting 16,000 small businesses from the payment of that tax. Although the reduction of pay-roll tax will benefit every payroll taxpayer, the greatest benefit will go to the smaller industries and commercial houses, and the exemption of many of them from the operations of the act will save them a tremendous amount of book work.

Another great benefit which will be of tremendous assistance to the community will be the increase of the depreciation allowance. Industry will be enabled to obtain the most up-to-date and efficient plant and thereby reduce costs. In scanning the budget we note that, in addition to emphasis being placed upon concessions to the family unit and the need for greater development, there is a recognition of the need for a reduction of costs. A reduction of the pay-roll tax and sales tax, and an increase of the depreciation allowance, are methods that have been employed to reduce costs.

The honorable member for Dalley said that the budget contained no provision for increased employment. On the contrary, there are many provisions for increased employment. The reduction of taxes alone will be an incentive to employers and commercial houses to provide additional employment. I cannot imagine anybody saying that the construction of the standardgauge railway and the additional provision for roads will not lead to substantially increased employment.

The particular matter to which I wish to refer this afternoon concerns what I regard as being the weak spot in the budget. I refer to the provision for social services benefits. The policy of the Government is to provide for this purpose the maximum amount that the economy of the country can stand, and with that policy I have no quarrel. In making my criticism, I am criticizing not the total amount that the Government has made available for increased social services benefits but the application of those benefits as between the various groups in the community who are entitled to them.

It is one of the faults of a democratic parliament that, as governments take more and more functions to themselves, very little time is left for intensive study of particular problems. One of the regrettable features of our social service legislation has been the tendency of all governments to follow slavishly a pattern that was established 50 years ago, and simply to increase or to reduce the rate from time to time without examining whether the benefit meets the need. Ever since 1909, our social service legislation has been based on what has been described as need, and need has been measured by what is known as a means test.

I have repeatedly stated in this chamber that that basis is wrong. It places cruel hardships on certain sections of the community, is unfair and unjust, and is deleterious to the economic health of the community. I have repeatedly advocated the establishment of a national age security scheme free of a means test, but I do not propose to burden the committee with further views on that subject this afternoon. I only wish to make it clear that I still believe that age is a known risk for everybody and that every one should provide during his younger years, by way of contribution, for age security payments. The Government, just as it has done under the Health Act, should subsidize such contributions so that everybody, on reaching the retiring age, will receive an age security allowance as a matter of right and not because he or she is destitute.

Having said that, I accept for the moment the policy that has been adopted by this and previous governments of basing eligibility for pensions upon need, and wish to examine how that policy is being implemented and where we are getting to. We now have two means tests - a capital means test and an income means test. Before a single man or woman, a widow or a widower can obtain a pension, that person must establish that she or he has not more than £1,750 in assets, other than in the form of a house and furniture, and has not an income in excess of £3 10s. a week. For married couples, the figures are double those which I have mentioned. But, the means test having been passed and eligibility for a pension having been established, the Government forgets all about need and says that every one shall receive a flat rate increase.

Let us consider the position of a married man in receipt of £7 a week superannuation. He and his wife draw a pension of £8 a week, and therefore have a total income of £15 a week, or £3 in excess of the basic wage. It is now proposed that the income of such, a couple shall be raised from £15 to £15 15s. a week. At the other end of the scale, we have the aged widow who draws a pension of £4 a week, who- pays £2 a week for rent, and has £2 a week left with which to clothe and feed herself. lt is proposed that her income, after payment of rent, shall be raised from £2 to £2 ;s. 6d. a week. The whole proposition is so ludicrously unjust and unfair that no government and no body of men or parliamen .allans should allow the situation to exist any longer. An aged widow who is paying rent of £2 a week cannot exist on £2 a week nor can she exist on £2 7s. 6d. a week. The need of the person who is already receiving £15 a week is not nearly so great as that of the widow whom I have mentioned.

Mow let us examine the Government’s proposals. It proposes to set aside, in a full year, an extra £16,000,000 for pensions. That is a very substantial sum. The Government, instead of paying all that increase to the needy, proposes to pay a substantial portion of it to people whose needs are not nearly so great as those of others. The facts are that 40 per cent, of the pensioners are single persons, widows or widowers, who do not own a home. In that group are most of the people who are in real need. Single persons, widows or widowers, who own homes, comprise 22.3 per cent.; 15.3 per cent, are married persons who do not own homes; and 22 per cent, are married persons who own homes. I mentioned before the case of the married couple, receiving £7 a week in superannuation payments, payments for work done or from other sources, plus £8 a week from their pensions, some owning a home, furniture and a motor car. When we contrast the position of that couple with the position of a widow pensioner who is paying rent, we see that it is ludicrous to give a flat rate increase of 7s. 6d. If we have an extra £16,000,000 - as I am sure we have - to divide amongst pensioners, let us give it to those who are in real need.

Many aged people drawing pensions live with and are kept by their children. This is as it should be. But the needs of those people are not nearly so great as are those of a widow or a widower, living alone and paying rent. Thousands of pensioners live in our wonderful religious homes, where clothes, board and all other requirements aTe provided. Many of these homes charge only £3 or £3 5s. a week, and the old people really have nothing on which to spend the balance of their incomes. Everything is found, and their needs are not great. If we have only a limited amount of money available, and if we are determined to cling tenaciously to the basis of need, let us pay increased pensions where they are most needed. What we really need is a base rate and a special, graduated pension, paid according to the ascertained needs of a person, in the same way as payments are made from the canteens fund. This is the way in which Legacy operates in doing its wonderful work.

Deputations come continually to Parliament House, sincerely and genuinely. What case do they put before us? They put before us the case of the widow paying rent, and they point out that she cannot live on the balance of her pension. She is one of those who should receive more money. I shall be glad to see any of our elderly people receive an increased payment, but I am not willing to stand by, without raising my voice, when certain people in the community are below the breadline, and we make increased payments to others whose needs are not nearly so great.

I am delighted that the Government proposes to do something which is very dear to my heart. I refer to providing additional assistance for homes for the aged, which I have advocated for so many years. We have made tremendous progress with building these homes in South Australia. We are providing beautiful little flats for aged couples, aged widows and aged single women. Our only trouble is that there are not nearly enough homes, and our hardest job is to allocate the available homes amongst the hundreds and hundreds of desperate people who come to us and ask that we provide roofs over their heads. When they get to these homes, they are the happiest people in the world.

The increased allocation of funds for this purpose will enable us to provide double the number” of homes that have been erected in the past. The Aged Persons Homes Act was passed only two years ago, but over 3,000 additional aged persons have been accommodated since then. I hope that we shall be able to increase that number greatly, because the real hardship is suffered by aged people who have no accommodation of have accommodation at a rent that they really cannot afford to pay.

I urge the Government to have another look at the whole problem, after the budget has been approved. Let us not be content with what was done 50 years ago and with what has been done by governments subsequently. The whole of our social services legislation needs an overhaul. The means test is a blight upon our community. The failure to pay a hardship pension or to make special provision for necessitous circumstances is a condition of affairs that we should not allow to continue. I know that members of the Cabinet are busy and have innumerable problems before them, but the problem of the aged is one that should have special examination to ascertain our objective, how it is to be achieved, and to what extent - if at all - the present social services legislation is meeting the situation. I believe that it is failing in all respects. Initially, the age pension was so small that it was not intended to provide the wherewithal for an aged person to live, but the more society has developed the more we have tried to make the pension something upon which an aged person can live. However, to-day we have the situation that a great many of our aged people just cannot exist on the pension, while others can live on it more than comfortably.

I have confined my remarks largely to age pensions, but I do not want it to be thought that age pensioners are the only people affected by social services legislation. Probably invalids are in a worse position, because they are unable in any way to supplement their incomes. I think, therefore, that they should have the highest priority for the special pension that I have advocated.

I do not think that we are doing enough for widows, particularly those with children. The situation calls for something more than just drawing a line and saying, “ We will pay £4 5s., £4 10s., or £4 15s. a week”. We must have a much more sympathetic approach. We must pay more attention to the human problems involved and determine whether a particular widow who is bringing up young Australians - the trustees of posterity - has enough to enable her to give her children the chance they ought to have to build the Australia of the future. As we examine the range of our social services legislation, we see its amazing weaknesses and pitfalls. The problem needs a thorough and intelligent study. I was very glad to see that, in addition to those of us who have been studying this problem for some time, Professor Downing and a group of university men in Melbourne were also studying it. This research should not be simply brushed aside; mature consideration should be given to the views that have been expressed.

I feel that members of the Government are too busy to know what is going on in relation to this matter. Private members are constantly moving amongst pensioners, the aged and the sick. They are in a better position to know where the real hardship lies and what measures are necessary to remedy the effects. I do not for one moment suggest that this Government is different from previous governments. For as long as I can remember, deputations have been waiting on governments, both Liberal and Labour, to make some complaints and have always brought forward the hardship case to prove their views. In my opinion, although they have always been able to prove the hardship case, they have not been able to establish that case as the general position of all pensioners.

The honorable member for Dalley described the amount provided for additional social services benefits as miserable. It would not be miserable if it were allocated amongst those in need. If that amount had been given according to the real needs of the persons concerned, I am sure that they all would admit that they had sufficient to enable them to maintain a reasonable standard. I hope that the Government will give most earnest consideration to the matters that I have raised. On this subject, mine is not a lone voice. Many organizations, pensioner associations and welfare workers realize the desperate position of a section of age and invalid pensioners.

Recently, many petitions have been presented to this House asking that a pension equal to half the basic wage be provided. If that request were granted, certain people would receive £7 above the basic wage. The average basic wage for the Commonwealth is £12 15s. or £12 16s. For the sake of ready reference, I shall call it £12 a week. If married pensioners were each given half the basic wage - that is, £6 a week each - and if they received superannuation of £7 a week, they would be getting altogether £19 a week. That is far more than the amount received by a married man bringing up a young family on the basic wage. The people who have signed those petitions have been sincere, but their case is completely unreal. An aged couple should not be allowed to receive £19 a week under social service legislation when the man with a family, who receives only the basic wage, is getting about £ 1 2 1 6s. a week. Of course, the people who present that claim really do not mean it. That is why I point out the need for study and research on this problem.

We should get away from the old idea of making the age pension a political football - a government giving an increase of 5s. and the Opposition saying it should be 7s. 6d. In 1949, the Chifley Government gave nothing. In the previous year it gave 5s. and the Liberal party said it was not enough. In 1950, when the Liberal party was in office, an increase was granted and the Labour party said it was not enough. It is cruel and wicked to the old people to treat them in the fashion they have been treated. They have been made a political football so that people could try to gain votes by pretending that they wanted to do something for the pensioner. If we really are to do something for the pensioner, we must study this problem and see that those who are really in need get the benefit. That applies through nearly the whole range of social services. This is an immediate and urgent problem which needs the most earnest consideration of the Government.


.- I recall that eighteen months ago the Prime Minister (Mr. Menzies) presented what was called the little budget. The Parliament was asked to approve many savage increases in indirect taxation, including sales tax and excise, an increase in the bank overdraft rate and certain economic restraining actions. I regret that, though two budgets have been presented since that time, in each the Treasurer (Sir Arthur Fadden) has largely retained the heavy imposts levied in the “Little Budget” of March. 1956. The wicked indirect taxation that was increased so alarmingly in that budget has been retained. The sales tax which was increased in 1956 is being held at much the same level and the increased excise is being retained.

I shall cite some figures to show how steeply excise has climbed in the last eighteen months and to point out the small section of the community that is bearing this very heavy impost. In 1955-56, the excise duty on beer was £85,314,945. In March, 1956, the Liberal party-Australian Country party Government increased the excise very steeply. It is proposed that, in 1957-58, the beer drinkers of Australia shall contribute £110,000,000 to the coffers of the Commonwealth Treasury. The more selective consumers of alcoholic liquors - those who drink spirits - will find that, whereas they contributed £7,324,650 in 1955-56, they will, if the estimates prove correct, contribute £8,500.000 in the current financial year. Smokers also are patriotically contributing to Commonwealth revenue by paying heavy indirect taxation on the tobacco that they consume. The excise on tobacco, which yielded £14,849,097 in 1955-56, will, it is estimated, yield £17,500,000 this financial year. However, the real patriots among the smokers are those who smoke cigars and ready-made cigarettes. Their excise contribution, which was £36,516, 150 in 1955-56, will be increased to £49,000,000. A considerable outcry against the savage impost of the increased excise was heard in 1956. It was expected that, when the budgetary position had been stabilized, to use the term adopted by the honorable member for Balaclava (Mr. Joske), relief from these heavy imposts of taxation and excise would be given. But it has not been given. The heavy imposts remain, and they impose a very heavy burden of indirect taxation on all sections of the community.

I hoped - not that it would have affected me to any appreciable degree - that the Treasurer would extend consideration in some form to those who are contributing so much to Commonwealth revenues in excise. However, although direct taxation has been eased, the relief is extended, not to individuals, who pay as they earn, but rather to well-established companies, which, according to their balance-sheets, are making record profits. In the financial year 1956-57, companies paid £216,571,064 in income tax. It is estimated that, in 1957-58, they will pay £210,000,000. I am sure, Mr. Temporary Chairman, that this is good news to shareholders in companies such as Broken Hill Proprietary Company Limited. They will now receive the benefit of the reduction of company taxation, and, in addition, a bonus share issue of £8,000,000. It will be good news also to the shareholders in T. C. Beirne Limited, in Brisbane, who will receive, on the one hand, the benefit of the reduction of company taxation, and, on the other hand, the benefit of a bonus share issue of one share for every two shares now held.

These facts make it clear that the statement made by the honorable member for Hindmarsh (Mr. Clyde Cameron), in an excellent speech last evening, that the rich are getting richer, and the poor are getting poorer, is correct. This is not a stabilizing budget, as we have been told it is. It gives concessions, I admit, to those who depend on social services benefits, but those concessions are only minor. On the other hand, it gives major concessions to those who are well endowed with worldly goods.

A very important problem confronting Australia to-day was touched on by the Leader of the Opposition (Dr. Evatt) last evening - the relationship of immigration to unemployment. In 1956-57, more than 1 1 5,000 immigrants were brought into Australia, and it is proposed to bring in about the same number in the current financial year. The Australian Labour party believes that immigration should be related to the nation’s ability to absorb immigrants, and provide them all with jobs. It is sad to think that a man should leave his home 13,000 miles away, and come to this new and strange country, only to find that he cannot get work. That is one of the results of the present Government’s policy, and the Government must take full responsibility for it. We are suffering from inflation on the one hand, and from unemployment on the other. That is tragic, and the lot of the unemployed is made doubly difficult by the inflationary spiral. There should be no unemployment in Australia, but we find a tragic situation in which 63,000 people are registered as unemployed. The Treasurer, in his budget speech, said -

We can expect for example, that a fair number of additional workers will become available this year, both from immigration and from local sources.

That means, of course, that additional labour will be available because some workers will lose their jobs. The right honorable gentleman continued -

It is important that these additional workers should be absorbed into industry.

It is not only important, but also essential for the well-being of the nation, that the additional workers should be absorbed into industry.

We find, tragically, that new Australians are being brought to Australia, particularly from Europe, and placed in immigration hostels with no work to do. I understand that about 5,500 people are at present living in immigration hostels. We all recall the tragic events that occurred in Hungary a few months ago. I am sure that the admiration of all free-minded citizens was aroused by the Hungarian people’s expression of their desire for a degree of freedom. Many of them fled from their native land, and ultimately found their way to Australia, to which they looked as a land of freedom where there was full and plenty, and where they were told that they would be made welcome, treated as Australians, and assured of security and future prosperity. However, that has not been their lot, and many Hungarians who fled from Russian militarism, which crushed the Hungarian revolt, find that they cannot get work in this country, even though they walk the streets searching for it. Some of them have even sought the assistance of members of Parliament in an effort to return to their Communistdominated homeland, where they can at least get jobs.

This is a sorry commentary on conditions in Australia, and a condemnation of the Government. It is tragic that people who have fled from a country with a Communist economy to Australia, where we have a capitalist economy, cannot find work, and feel compelled to try to return to Hungary. If they do return, the experiences that they have had in their absence will make them confirmed Communists. This Government is confirming the Communist ideology in the minds of those people. Its policy of deflation in industry is also likely to cause more unemployment and thus create an atmosphere in which communism thrives.

There should be ample work for all the immigrants who come to Australia. There is urgent need for the reconstruction of many of our national trunk roads. Because of a judgment of the Privy Council in relation to interstate trade, the States have been deprived of much revenue. Consequently, trunk roads throughout the Commonwealth have fallen into serious disrepair in some States. That state of affairs could be remedied by providing immigrant labour to reconstruct the roads. As the Treasurer knows, there is plenty of money available but, apparently, the Government intends to continue to support the expressed policy of a professor of economics who recently arrived from London to lecture in Brisbane. Apparently, as honorable members on this side of the committee, and particularly my friend the honorable member for Stirling (Mr. Webb), have suggested, the Government believes with the professor that there should be a pool of unemployed.

Mr Brand:

– Under a Labour government in Queensland.


– We have not had a Labour government in Queensland for some time. The Government proposes to give effect to a suggestion that has been advocated by honorable members on the Opposition side. I refer to the imposition of a tax on diesel fuel. All honorable members know that, as a result of a Privy Council judgment in relation to interstate trade, many interstate hauliers have been paying no tax for the maintenance of the roads they use. Honorable members on this side of the chamber, particularly the honorable member for Batman (Mr. Bird) as the spokesman for the Opposition Members Transport Committee, have advocated a tax on diesel fuel, and the Government is preparing to give effect to that policy. Provision has been made in the budget for a tax of ls. a gallon on diesel fuel used in motor vehicles on the roads. In itself, that is quite reasonable. It will assist the States in the maintenance of the roads that are used by the hauliers. They will be able to maintain the highways in better condition.

The proposal, however, has one unfortunate feature and, at the risk of being parochial, I intend to refer to it because the conditions to which I shall refer probably apply equally to many cities throughout the Commonwealth. I am speaking now as the representative of a Brisbane constituency. The local government authority in Brisbane - the Brisbane City Council - operates a municipal bus service. The buses run only on roads that have been constructed by the Brisbane City Council, and the citizens of Brisbane pay for the construction of those roads through their rates. The council is to be asked now to bear the added cost of ls. a gallon on the diesel fuel consumed by its buses. The revenue so collected by the Commonwealth will be repaid to the Queensland Government. I suggest that municipal authorities which operate bus services on roads constructed from municipal revenue should be exempt from the payment of this tax.

I propose to read to the committee some figures showing the size of the service that is operated by the Brisbane City Council and what the citizens of Brisbane will be expected to pay. In the last financial year,, the bus services operated by the Brisbane City Council carried 23,863,657 passengers. The revenue from those bus services totalled £895,476 and expenditure was £1,216,603. As is general with public transport services throughout Australia, the Brisbane service is being run at a very heavy loss, and the ratepayers of Brisbane are subsidizing the municipal bus service to the amount of £321,127 a year. Diesel buses in service total 220, and in 1956-57 they consumed 549,717 gallons of diesel fuel.

It is estimated that the tax on diesel fuel will increase the cost of the service by £27,500. That extra charge on diesel fuel will be collected by the Commonwealth and returned to the Queensland Government. It will then be used on the construction of roads, but not on roads in the municipality of Brisbane. The citizens of Brisbane will be asked to find that extra money, and I imagine that the additional impost of £27.500 will be used as a very sound reason for increasing bus fares. I cite this case because I have some knowledge of it, but I believe that the same set of circumstances will apply to many other municipalities throughout Australia. I ask the Treasurer to consider exempting from the payment of the tax on diesel fuel municipalities which are in that position.

The proposal in the budget to increase the payment for hospital benefits by 8s. a day to patients who subscribe to a hospital and medical benefits fund is worth while but, as a Queenslander, I believe that there is something rather sinister, not in the proposal in itself, but in the way in which it can be used by the Queensland Government. Everybody who does not live in Queensland is envious of the fact that, thanks to the former Australian Labour party government, the citizens of Queensland enjoy a free hospital scheme. Any sick person can go into a public hospital and be treated free of charge. Whereas at present a person who is a member of a hospital benefits fund receives 4s. a day during his stay in hospital, the Government proposes to increase that amount so that such a person will receive 12s. a day. We know that the Government also pays a subsidy of 8s. a day for each occupied bed in public hospitals. The cost of running a hospital has increased very greatly. The honorable member for Balaclava (Mr. Joske) informed us that in Victoria all hospitals are experiencing considerable difficulty in paying their bills. Since hospital costs have increased, I should have thought that the Government would have increased the general subsidy on occupied beds in public hospitals, but it has not done so.

The expressed policy of the Queensland Government is to continue the free hospitals scheme in that State, but to make available more intermediate beds in public hospitals. It is quite obvious that the number of free beds in public hospitals will be reduced, while the number of beds available in intermediate wards will be increased. For those beds the patients will be compelled to pay. I believe that this is a subtle and cunning way of whittling down the free hospitals scheme. This Government is encouraging the Queensland Government to adopt this policy by granting the increase of 8s. a day only to persons who are members of a hospital benefits scheme. I believe that I am not being unduly suspicious when I say this. I do know that the present Premier of Queensland was most outspoken some years ago in expressing opposition to the free hospitals scheme, and that he was let down somewhat by his fellow Country party member, the Minister for Health in the Commonwealth Government at that time.

Mr Hamilton:

– Have you a policy?


– Yes. The policy of the Australian Labour party in Queensland is to maintain completely the free hospitals scheme and to ensure that every citizen of that State who wishes to go to hospital can enter a public hospital and obtain the best accommodation and treatment. I believe, however, that the free hospitals system will be whittled down, and that people who today are entitled to free hospital treatment will find, when they wish to enter a hospital, that no accommodation is available for them except in intermediate wards, in which they will have to pay considerable amounts of money.

Mr Hamilton:

– The honorable member does not believe that, does he?


– Yes, and I feel that there is some connexion between this proposal to increase the hospital allowance from 4s. to 12s. a day and what I believe to be the intention of the Queensland Government.


– It is a crafty move!


– I feel that it is a crafty move. I have only a couple of minutes left, so I do not propose to develop any other theme in connexion with the budget, although there are many aspects on which one could speak and for which the Government could be criticized. As a Queenslander, I make an appeal to the Treasurer to consider exempting, local authorities from payment of the tax on diesel fuel, because this tax will fall very heavily, by way of increased fares, on those who use buses operated by municipal authorities.


– This budget marks the end of a decade of unparalleled expansion of the Australian economy. In the last ten years we have absorbed 2,000,000 people, and our work force is now approaching 4,000,000. In other words, industry has created 50 per cent, more jobs than were available a few short years ago. Private investment has reached a figure of £5,500,000,000, and government investment in capital works has been around £3,000,000,000, making a total capital investment of £8,500,000,000 in ten years. This represents approximately 30 per cent, of the national income, which puts Australia, if not at the head of the list of rapidly expanding countries, then very near the top. It is a far greater percentage than can be claimed by most other countries. Three-quarters of this investment occurred during the last five years. The policies of this Government have resulted directly in a tremendous expansion of investment in Australia by Australians. They have also resulted in attracting capital from overseas to help us build up our country and develop it rapidly. Some £600,000,000 has come in from overseas, and capital is still coming in at a very fast rate.

This budget is significant, I believe, because it contains a hint of a change in the style of budgets. Until now we have had what I call equilibrium budgets, budgets designed to share the wealth of the community as fairly and as generally as possible. But in future, owing to the forces that are mounting in the world, I predict that we will see a continuation of the trend towards the encouragement of investment, of production and of savings. I say this princially because of the acute capital shortage throughout the world, particularly in the western countries. The western countries do not have facilities at their disposal such as the Communist totalitarian countries have. They do not have the ability to depress living standards and to force savings. The western countries must depend on voluntary savings and voluntary expansion of industries. This acute capital shortage comes at a time when we find ourselves on the threshold of vast, farreaching developments resulting from the discovery of nuclear energy, the speeding up of communications, the discovery of synthetics, automation and a number of other revolutionary developments which are just about to come into flower. We need tremendous amounts of capital to take advantage of these developments. In our own interests, in order that we, with our free system, may keep ahead of the totalitarian countries in developing the new forms of power, we must use every means at our disposal to increase our capital.

Apart from these external forces, a domestic force has compelled us to turn more and more of our attention towards high production. This domestic problem arises from the rapid increase of the size of the younger age groups. Within five years only, we will have 50 per cent, more children in secondary schools and a few years later we will have to find jobs for those additional youngsters. That is a very welcome problem, certainly; nevertheless, it is a problem. It means that we must have the capital to create jobs before the youngsters look for work. We must see to it, also, that they are properly trained and educated before they reach maturity.

This trend towards production and savings will continue at an increasing tempo. We have a hint of that in this budget, in the Treasurer’s proposal to encourage the investment of capital in this country from overseas and also in the measure of relief to be given to companies in order to enable them to expand more easily than they have done in the past. I believe that one of the first things that will be done, when the appropriate time presents itself, will be to givesome positive assistance to that section of the community which is really the backboneof the country - the self-employed, and the skilled salary and wage-earners. That section of the community has it within itspower to raise productivity and increase the savings which are so urgently needed. One way of giving them assistance in a practical form would be to abolish the means, test at, say, 70 years of age. I am told that abolition of the means test in respect of age pensions at that age would cost £38,000,000. I do not believe that that is a prohibitive amount, especially when we consider that not only do we want increased savings but also the preservation of the sense of personal responsibility that goes with personal savings. We must preserve that particular quality, which the totalitarian countries endeavour, at all times, to stamp out. We must preserve it because it is at the very basis of our free parliamentary system.

Mr Thompson:

– Would the honorable member favour abolishing the means test at 70 years of age for both men and women?


– Yes; and I will welcome that provision when the time is appropriate for its introduction. It would have a great effect on the savings habits of the community in general and would lead to a vastly increased volume of new savings, thus making it easier to accumulate capital for investment in industry and create new jobs. A second emphasis which will become increasingly heavy in future years will be along the lines of productivity. The word “ productivity “ is not understood as well as it should be, although it has received a great deal of thought in recent years. I think it is quite likely that the Treasury could find some means of encouraging productivity through taxation measures. This is something to which it could well give some thought. Over the last few years, through institutes of management and also through the Ministry of Labour Advisory Council an attempt has been made to spread knowledge of productivity and of the means of bringing it about through the unions and through management. But it is not always wise to build from the top down. I would rather see education proceed through the pay envelope, and I think that might bring about more effective results.

There are ways of increasing productivity other than through practical fiscal measures, such as giving relief to people who practise productivity and benefit from it. There are ways which we have already started to employ, such as the encouragement of industry to equip themselves with new machinery. I, myself, am convinced that new and efficient machinery is a great stimulus to productivity in factories.

We could do more than we are doing now in research and extension work. That applies equally to primary as to secondary industries. We are doing not nearly as much in either field as is being done in other countries, yet our need is probably very much greater. In the field of primary production, particularly, we cannot afford to let this problem ride or we will run a very big risk. For example, in the grazing industry alone, where there is a great shortage of rural extension officers, if a drought occurred as disastrous as the drought of 1944-47, we would find ourselves billed, at the end of the first year, with a cost of at least £80,000,000,’ and over succeeding years, if it followed the pattern of that drought, we would lose upwards of £500,000,000. In the 1944-47 drought the number of sheep fell from 123,000,000 to 95,000,000, which represented a decrease of 22 per cent. The wool clip, during that period, fell by 657,000 bales. We have to face not only the effect of the actual years of drought but also the long building-up process that continues well after the drought is ended. If we had more rural extension officers I believe that a great deal of that risk would be obviated. I suggest to the Government that a conference should be called between Commonwealth and State agricultural authorities to find a means of strengthening our research and extension workers in the field of primary industry. Not only the grazing industry but also all sections of primary industry suffer as a result of the shortage of these trained men.

In secondary industry also there is a shortage of research workers. Private industry in Australa does very little to assist in research as it spends only £3 per £1,000 turn-over, as against £15 per £1,000 in the United Kingdom and £20 per £1,000 in the United States. This emphasizes the need for research and development in Australia, which is greater than the need in any other country because we are still at the beginning of development and have much to do to catch up with other countries. We should be spending a great deal more on research and development. In this connexion, also, I suggest that a conference be arranged between Commonwealth authorities and some of the business associations such as the manufacturers’ associations.

Summing up, this trend towards production incentives which I foresee and which I believe is hinted at in this present budget will continue to grow in emphasis. This will not affect our standard of living, provided productivity is increased by allround efficiency and by the effective use of our resources. I would welcome a trend of this kind because it would strengthen our economy, it would make sure that we maintained our position of leadership in this section of the world, and, by giving encouragement to that quality of personal responsibility to which I referred, it would actually strengthen the structure of our society and ensure our national security.


.- There are one or two points on which. I agree with the honorable member for Gwydir (Mr. Ian Allan) on general principles, at any rate. He said he was in favour of the abolition of the means test at 70 years of age. That being so, I presume that he agrees with the abolition of the means test in principle, which is something very close to the core of the Labour party’s policy. Ever since its inception, the Labour party has stood for decent security in old age and retirement.

But there are some other aspects of the honorable member’s speech with which I cannot agree. That remark applies to most of the speeches that have been delivered from the Government side. Last night, the Minister for Immigration (Mr. Townley) made what he regards as a great case for the acceptance by the people of this budget. He said it was prudent, he said it was cautious, he said it was conservative. 1 want to know what it is in this country that demands that the people who should be showing leadership and drive to the community should be prudent, cautious and conservative. They are not the qualities that will build a great Australian nation. They are not the qualities that will build in the next 100 years a nation worthy of the people who have laid the foundations during the last 160 years. I cannot agree with the honorable gentleman’s statement that this budget stresses the important things in family life. Those things which are important to family life, such as decent security, solid proof that one will be fully employed, and a housing policy, are not to be found in it. I do not agree that the £13 up-grading in the allowance for a taxpayer’s wife is an adequate amount. I suppose it is transference to family life of what the Government calls a depreciation allowance in the company field, and I am certain that there is hardly anybody in this country who will consider £13 adequate for that purpose. If depreciation allowances are so important in the company field, a more adequate scheme of allowances for one’s family is important in the domestic field. If we examine the depreciation allowances and take note of the details of the income tax schedules, we find that the person paying income tax at the rate of 5s. in the £1 receives two or three times the amount of rebate allowed to persons in the lower-income bracket, yet it is the person on the lower-income bracket whose needs we should have in mind when we are examining the social and economic problems produced by budgets.

There are some things in the budget with which this party agrees wholeheartedly. One is the financial provision for the Colombo plan. We agree that it is important that we support the people to our north and encourage them to regard us as friends. We are prepared to spend £190,000,000 a year on defence, but the best defence against any people is to have their friendship, and in respect of the last line of defence it will be the friendship of the people of the north which will preserve this country in the way in which we desire.

We also agree with the very cautious, prudent and conservative steps taken by the Treasurer (Sir Arthur Fadden) towards the encouragement of the standardization of rail gauges. The steps are undoubtedly very cautious and very conservative. I do not think he says how much he is prepared to grant for that work. He is prepared to encourage others to get on with the job and then, if they come along to him, cap in hand, they will probably get some reimbursement in the end. We are pleased that the Treasurer has acknowledged that this is a national development plan and that we should press on with it.

The budget itself is an important document. The Treasurer himself said so. We look to it for something that will guarantee social security. Social security means many things to the Australian people. It means a proper health service. It means to the people of the country the same measure of hospital and medical service that the returned soldier who is lucky enough to receive repatriation benefits gets. We live for the day, we look for the day and we work for the day when every Australian will receive hospital benefits and medical services more commensurate with what are granted under the repatriation scheme. We believe also that a decent pension in retirement is part of a proper social security scheme. We all look for a proper national housing scheme. We look for the encouragement of home-ownership and home-building. Previous speakers on the Government side have made a great song about the importance of family life, and there is nothing more important in family life than adequate housing.

Mr Barnard:

– They were not serious.


– Apparently not. If a proper housing scheme is likely to interfere with commercial practices, honorable members on the Government side will not support it.

I, personally, prefer to see in the budget some sponsorship of the State education system, some understanding of what education means, and some appreciation of its deficiencies in this country. I agree with the honorable member for Gwydir when he says that it is time we really encouraged research, that it is time we really adopted the Commonwealth Scientific and Industrial Research Organization and other research institutions in the community as an important and integral part of our whole way of looking at things. I noticed in the press this week that the C.S.I. R.O., after conducting an examination of electric light poles or telephone poles - I think it was telephone poles - had worked out a scheme by which about £200,000 could be saved by the application of scientific principles to the work carried out through the postal or electricity services.

Looked at even from the material viewpoint, research is a very important item in community development. If we look at it from the viewpoint that is important to the people generally as human beings, we recall that we have read that a leading gynaecologist is somewhat disturbed at the lack of research in the field of medicine in Australia. One does not need to study the problem very fully to find in the field of social research, the need for a more scientific approach on the part of the Government to the problem. We look in the budget to see whether there is any indication that these things are to be done.

I suppose that, at this stage, as the committee is examining the budget as a financial document, we look for such things as the production of greater economic justice. The honorable member for Gwydir stated that over the last few years there had been an attempt to produce a levelling out of prosperity. Perhaps that is aiming at what we call, briefly, economic justice. We on this side do not agree that there has been any real effort to produce economic justice, and we deny that we are anywhere near that ideal yet. I believe that economic justice means a proper system of taxation based upon ability to pay. This Government’s policy is to gather in the shekels. Further, we believe that full employment is vital to the whole field and pattern of economic and social justice. As we have been promised by a Minister that something will be done to reduce unemployment, we look to this document for it. We are 9,000,000 people in a country of 3,000,000 square miles, with great resources in and on the earth, but we need to organize and develop them. We look to the Government, in its budget, to attend to those matters.

The budget has become a document vital to the further development of the whole nation in every respect. The initiative in many matters lies now with this Parliament because of the financial and federal structure of the country. We look in the budget for the things I have mentioned, but we look in vain. Notwithstanding the fact that the Treasurer has told the committee that the budget occupies a central position and its range of influence is very wide, it is in fact a dreary document. It is a series of mathematics. We are just another progress association sitting down deciding whether to paint the fence in the park.

Mr Cairns:

– It does not even add up.


– It does not even add up, as my friend says. If we look at it as a necessary social document, it does not add up at all. I waited with anxiety, if not confidence, to see what this document would produce in answer to the questions raised on the 29th August last by the honorable member for Bass (Mr. Barnard) in an urgency motion on unemployment. In that debate the Minister for Labour and National Service (Mr. Harold Holt), a very important citizen of this country, as he himself will admit, said -

The Government’s measures to correct such slack as has already appeared in the economy . . will be revealed, at least in part, in the budget proposals to come before the House next week.

He later said -

In our planning not only have we tried to keep some of our own projects fairly flexible, as I think the budget statement will reveal.

I have examined the budget programme and I find nothing in it that is flexible. It is about as flexible as an army boot and about as comfortable to its 9,000,000 wearers. It contains no indication that these problems were even at the back of the minds of the people who have been responsible for its preparation. So we look in vain. Despite the Treasurer’s statement about the important part the budget will play in national planning - it is his tenth effort - it does nothing to solve our national problems. In a country where thousands are unsatisfactorily housed, it ignores the housing problem. In a drive around the suburbs of Melbourne any one with a heart will see what could be done to re-house the people. We estimated last year that anything up to 200,000 houses were required in order to house the people of Australia satisfactorily; but there is no indication that that problem has been tackled. In this country which is dedicated to a system of social security, full employment and security in old age are vital to every Australian. They are part of our way of life, and our way of looking at things. People in this country would rather have security than large sums of money. But living on a pension has become a miserable poverty-stricken existence instead of a decent way of living and a standard of subsistence that is due to the dignity of human beings.

A democracy such as ours depends for its very continuance on an enlightened and educated community, but we find nothing in the budget which admits that the States are incapable of carrying on a proper education system. We find that other matters are attended to but important social considerations such as education, are ignored. It is supposed to be a federal system. Government supporters lay great emphasis on the sovereignty of the States, but the Commonwealth Government is strangling State and municipal road-building projects and school-building projects. Where national development requires urgent attention, we find that no great construction or creative works are being undertaken. We find nothing on the books to measure up to the concept of the Snowy Mountains hydro-electric scheme when it was first commenced, the immigration scheme when it was first introduced, the Commonwealth Reconstruction Training Scheme, from which grew the financial assistance scheme to students, the National University, or commercial projects such as Trans-Australia Airlines. We look in vain at the record of this Government, with its ten budgets, for one constructive or creative effort that will measure up to what was achieved five or six years before it took office. Every Government supporter should examine his own conscience and his own political ideology to see what can be done to make up the leeway.

I agree with the Leader of the Opposition (Dr. Evatt) that this country is facing slow strangulation and stagnation. The economy is being whittled down to a stage where it cannot compete overseas. We have had to sell some of our birthrights in order to dispose of our primary products. These are matters which in the long run will have very serious effects upon Australia’s development as a nation, and, in the short run, are having very serious effects on the community.

The unemployment problem cannot be ignored. The fall in living standards cannot be ignored. When this Government took office on the 10th December, 1949, the number of unemployed was 702. Now, eight years later, we find that there are 20,000 or more receiving the unemployment benefit. The standard of living is slowly declining. Our population has increased by 200,000 in the past year, but food production has not increased; no extra clothing is being produced and no more of the necessaries of life are being produced. There are fewer people on the farms now. Fewer new motor cars are being sold than previously, and surely a motor car should be accepted as part of the standard of living of the average Australian. The natural ambition of the average Australian to own a motor car has become an instrument of the tax policy of this Government. That is indefensible. The average earnings of the workers have risen by 5i per cent., but prices have risen by 6 per cent. So, examined from every angle, very little can be said for the whole document as something designed to develop Australia . along the lines we would all desire.

Two features of the budget of which we do approve are the Colombo plan pro* visions and rail standardization proposals; but there are many things of which we strongly disapprove. We disapprove of the reduction in company tax at a time when pensions apparently cannot be raised. The reduction in company tax will amount to £14,000,000, but probably, with the increase in company incomes, the loss of revenue from that source will be only £6,000,000. New depreciation allowances are estimated to mean £14,000,000 to industry; yet pensions can only be raised to the extent of £8,000,000!

The Labour party is not a low-tax party. 1 do not subscribe to the view that taxes must be reduced. I was rather impressed a few months ago by leading articles which appeared in several newspapers, supporting an increase of pensions; but a few weeks later, as budget time drew near, the same papers were advocating a lowering of taxes. Such tactics contribute nothing to a solution of our developmental and social problems. The average Australian is mature and grown up. He fills in his taxation form with reasonable honesty - at least I hope he does, because by so doing he reduces the burden on others. We place a great deal of reliance on the mature attitude of the people towards filling in forms such as those necessary for taxation refunds. The average Australian, faced with a problem, is prepared to pay for the things he wants, and any government or any body of people which tries to convince the average Australian that things can be done without paying for them is doing the community a great injustice. That is no part of Labour’s policy. We believe in the redistribution of income through a proper taxation system. Only by that means can we produce the kind of society we believe in. t should be prepared to pay another £60, £70, £80, or £100 in income-tax if higher taxation would produce social security and solve some of the problems implicit in the retiring age of the people in this community. I know that everybody in the community, if squarely confronted with the problem, would feel the same way. I live in a small community where the people were asked to raise their rates by £1 per year for ten years in order to pay for a public hall. When they were faced with the problem, they signed on the dotted line. The average citizen has a high sense of responsibility. Ninety per cent, of members of the community are decent and dinkum citizens who, when faced with a problem, will pay up. The people in the City of Melbourne are prepared to pay up. Members of Parliament representing city electorates are not constantly receiving deputations asking for bonuses and special grants as are Country party members. Unfortunately, the Country party’s whole existence is based on an attempt to get more from the community than it puts in. Notwithstanding the great pioneering work it might carry out, notwithstanding its importance in the community, the fact is that the Country party in the Commonwealth sphere and in every State is pledged to an attempt to convince the ordinary country people that they do not get a fair go, and that the parliaments of the nation are to be used for trying to get more back from the community than they put in.

That attitude is indefensible, and it is time that the honorable member for Mallee (Mr. Turnbull) took the Treasurer to the Mallee to tell the people there to pay their whack with everybody else, even with respect to national service. Australians, in general, are decent, responsible and mature. If they see that there is social justice, a just taxation system, and wise public expenditure, they are prepared to pay; but when the Government plucks a figure of £190,000,000 out of thin air they are not satisfied. Why has it stayed at £190,000,000 for so long? What has this expenditure produced? What could be done with £1,000,000,000 in the way of standardization of railway gauges? What could one do for the education system with the loose change out of £1,000,090,000? What could be done for social security with one-tenth of the defence vote every year? What could be produced as a defence system if that vote were properly used? Despite this expenditure, the Government has left the country defenceless.

A short time ago, the Minister for the Army (Mr. Cramer), with great pride, announced that, after four or five months of organization, our mobile defence force, including the general staff, the deputies, the adjutant-general and the ordnance, the Army Service Corps and the whole lot of them, lock, stock and barrel, bag and baggage, amounted to only 3,800 men. The Government should have been able to mobilize three divisions in less time than the six or seven years during which it has spent fabulous sums of money on defence. The Minister for Defence (Sir Philip McBride) will have a lot of explaining to do if some one adds up his pay book and says, “ You are about £1,000,000,000 down and we cannot see what we have got for it “.

Two aspects of this budget that give me great displeasure concern the pay-roll tax and sales tax. I do not think that people are quite aware of the effect of the pay-roll tax, an effect that seeps into every aspect of the economy. This tax increases the cost of shoes, electricity and railways. Let us consider the ridiculous and almost fantastic position of the railway departments in Victoria, New South Wales and the other States. These departments, which have increasing deficits, are paying pay-roll tax. The Victorian Department of Railways pays £652,316 in pay-roll tax each year. How many new trains would that money buy? The Victorian public service pays £770,000 in pay-roll tax. The Victorian State rivers authority pays £84,000. Every State and municipal instrumentality which employs sufficient people pays pay-roll tax. The system is indefensible on any grounds. According to the report of the Commonwealth Taxation Commissioner, of the 37,000 employers who pay pay-roll tax, 882 are public authorities. They are distinct from public authorities which engage in activities such as manufacturing, forestry development, and the finance of property sales. So perhaps 2i per cent, of the payroll tax is, paid by government instrumentalities. They are the greatest payers of pay-roll tax. lt is time that we appreciated the fact that municipal, State and Federal authorities are all directed towards, the one end - the well being of the same people.

The investment policy that the Government has developed over the last seven or eight years, a policy that places the burden of taxation on the family man, is indefensible. People are incredulous about this situation. They say to me, “What is the Government going to do with that sum of £100,000,000? Will we get higher pensions? “ I say, “ No. That has to make up the lee-way in the loan funds “. When the States receive their grants, they have to pay interest on the money. The average citizen is astonished to find that the money which he pays in sales tax, income tax or customs duty, and which forms part of the £1,200,000,000 which will be raised under this budget, is lent back to the States to build schools and that, not only does he pay interest on it, but the people who build the schools have to pay pay-roll tax. That is indefensible.

The burden of taxation and of interest rates and repayment of loans is falling more heavily on the States while the Commonwealth’s burden is decreasing. This year, the Commonwealth will have to find about £60,000,000 for interest, which represents about 5 per cent, of its revenue, but Victoria will have to use about 12 per cent, of its revenue for that purpose. It is ironical and fantastic that some of that interest will have to be paid to the Commonwealth Government, which has paid money out of the Loan Consolidation and Investment Reserve to the extent of £90,000,000 in order to support the borrowings of the Australian Loan Council. If the Government continues in that way, how can it do other than produce an inflationary spiral? Because the Government levies pay-roll tax and places interest burdens on State instrumentalities, the State Premiers have to come to the Premiers conference and say, “We want’ another £1,000,000”. Then the Commonwealth Treasurer levies more taxation to find another £1,000,000 so that the States may pay pay-roll tax.

It is time that the whole basis of taxation, was reconsidered in the light of the need of Federal and State bodies. The Government cannot continue in this way. The burden on every aspect of our economy is increasing. Indirect taxation is part of the burden that is weighing down industry and depressing our standard of living. One change for which I continually hope in federal policy is the acceptance by the Commonwealth of some of the burdens that lie on the States. An important one is the cost of education. The Government supports the National University, and it has made grants for this and that. Section 96 of the Constitution gives the Commonwealth Parliament power to levy taxation to be distributed for specific purposes to the States.

There is nothing at the moment which requires assistance more urgently than the education systems of the States. The education systems of the States vary so much that this Parliament ought to accept the challenge. It should see that all Australians, no matter in what State they live, receive the same standard of education, and should be a standard that will enable them to compete successfully with people overseas. In 1953, Australians spent 119s. per head on education. The amount spent in each State varied considerably. New South Wales spent 129s. per head. Victoria, a Liberal State, spent only 108s. per head. Queensland spent 97s. 2d. per head, South Australia Ills, and Tasmania 141s. I think that Western Australia was at the top of the list with an expenditure of 145s. per head. Congratulations to Western Australia, Premier Hawke, and the Australian Labour party there.

I hope that next year the Treasurer will accept some of the challenges that are implicit in our whole national structure. I refer to the need for national development, a change in the taxation system, and the provision of vital assistance to the States for such matters as education and hospitals. The Government should try to provide the people with a decent system of social security through such measures as proper retirement and unemployment benefits. At the moment I can only say that this budget is a dull, uninspiring and rather pinch-penny document.

Sirring suspended from 5.59 to 8 p.m.

Minister for Primary Industry · Lowe · LP

– The arguments of the Leader of the Opposition (Dr. Evatt) criticizing the budget proposals of the Treasurer (Sir Arthur Fadden) can, I think, be summed up in three propositions. Many of his claims in support of them are, I believe, false, and some mischievous. I hope during the course of my remarks to prove, first, that his contentions are wrong and, secondly, that an exactly different conclusion would follow if the facts were presented to the committee.

The first proposition can be summed up in the right honorable gentleman’s own phrase that the policy of the Government is “ a story of the deliberate sapping of the basis of our prosperity “. The second proposition is that the Government has not lived up to its promises to sustain full employment and rising standards of living. The third proposition is that the fiscal and monetary policy of the Government - in terms of public works programmes, interest rates, taxation, and the other paraphernalia used to sustain full employment and rising standards of living - has been improperly, or not properly, employed. This’ is the first occasion since I have been a member of this Parliament on which I have heard the right honorable member use not only the budget itself, but also the national White Paper on Income and Expenditure, to support his arguments. However, he has extracted those facts which support his case, and has omitted the overwhelming mass of facts that would have led to a different conclusion. He has woven surreptitiously into the fabric of his argument a lot of personal opinion - in the hope and expectation that the listening public might take it to be scientific observation and deduction. I repeat, many of his claims are wrong and erroneous, and some of his conclusions and statements are mischievous.

I, for one, propose to keep to the facts. First, I think it is proper on an occasion such as this - in order to bring the matter into perspective - to study the problems which the Government had to face and the action which it took to overcome them. I think that it will be agreed that eighteen months or two years ago, two major problems faced the Government. The first was the continuing increase in costs. If we look at one quarter only - the June quarter of last year - we find that the increase in prices amounted to more than 2 per cent. In the June quarter of this year the rise has been a little less than 1 per cent. The favorable downward trend is continuing. Last year the Government had to face rising costs and prices, and take action to dampen them down. Honorable members will agree that the Government’s concern was understandable. Continually rising prices and wages create a spiral - a vicious spiral if you like - in which wages chase prices, and we have the whole paraphernalia of inflation, distorted production and a less efficient economy.

Also, three years ago the Government had to face a very adverse balance of payments in what is called our “ current account “ - the normal current account, omitting capital items. The deficiency amounted to £200,000,000. In the next year an equally grave deficiency of £200,000,000 occurred. Last year there was a credit surplus of £80,000,000. We finished the year with very favorable additions to our overseas resources. I shall mention only one other fact at this stage. It illustrates the need in a country such as ours to keep prices as low as we can. If, at the same time, prices rise overseas, we may expect to sell more and thus make a greater contribution to the solution of our balance of payments and of our imports problems. Three years ago our exports amounted to £778,000,000. In the next year they rose to £788,000,000, and last year to the very high figure of £995,000,000. That is the background against which the actions of the Government should be judged.

I propose, now, to return to the arguments of the leader of the Opposition. As I have said, he first impugned the motives of the Government in these words -

It is a story of deliberate sapping of the basis of our prosperity by people who think a prosperity fairly distributed is dangerous . . . that stagnation is equivalent to stability.

Opposition Members. - Hear, hear!


– Honorable members opposite say, “ Hear, hear! “ because, thriving as they do on discontent and on the prospect of unemployment, they wish to encourage any adverse trend which may, even temporarily, further their political cause. As I have said, in this extract the Leader of the Opposition was merely expressing his own opinion. He would be the last person in this country to know the mind of my colleague, the Treasurer, or to understand the intentions of a Liberal-Australian Country party government. He would not know its motives. What he has said will be judged by a voting public which has, year after year, kept him on the Opposition benches. One can dismiss quickly that part of his argument relating to intention and motive. At best, it is a flimsy argument. It is somewhat futile, and it is one that the Australian public must judge itself.

The second argument relates to full employment and the protection of living standards. At least the right honorable gentleman did the Government the credit of saying, in effect, “ I know that this is your policy, and 1 have based my remarks on the assumption that you believe in full employment and the protection of living standards “. However, he tried to suggest - for some reason which he has not made known to us - that we have not lived up to those ideals. It is here that we should analyse the facts very carefully and decide who is right - the Treasurer, the Treasury officials and the Commonwealth Statistician, or the Leader of the Opposition. The real facts produce a conclusion which is exactly opposite to that arrived at by the honorable gentleman.

Let us consider, first of all, the problem of full employment. First, I should congratulate the Minister for Labour and National Service (Mr. Harold Holt) upon being the first person to give real meaning to the term “ full employment “. He was the first to say that what he meant was, as many jobs as, if not more jobs than, there were people able and willing to fill them. For him, it has been not so much a personal crusade, as an article of faith, that we should sustain full employment, and that the trade unionists should enjoy better and better standards of living. Any attempt to try to impugn his motives cannot but attract the ridicule of the trade union movement, and of almost every sensible person in the community. I do not think that my colleague has ever argued that, in a changing world, we can reach the happy state of affairs in which there is always a perfect balance. There must, of course, be occasions when over-full employment will be experienced. Of course, there will be occasions when we will have a little less than full employment. It is on those occasions that the Government, if it can, will take action to alter the position.

Let us look at the facts. Have we, in fact, an unacceptable and unfortunately high level of unemployment to-day? I quote figures which were given to me by the Treasurer. We have in civilian employment to-day, excluding rural industries and private domestic service, 2,800,000 people, or 4,200 more than in June, 1956. That figure of 2,800,000 is the highest figure ever recorded for the month of June. Therefore, it is useless to try to create the impression that there is a completely unacceptable level of unemployment. That suggestion does not tally with the facts. The Government recognizes that there are some difficulties, and it has taken what action it regarded as necessary to live up to the ideal which my colleague fathered and which is now so well known to the country.

I mention but three facts. First, I am hopeful that by now the trough, has been reached and that we can look forward to increased employment. I will not tell honorable members why at this point, because I want to put those arguments forward at the conclusion of my speech. However, what I should like to say is that the Treasurer pointed out that, although there was some unemployment, it was due mainly to adjustments that had been occurring in particular industries and localities, and did not reflect a general deficiency of demand for labour. With that proposition and that statement I wholeheartedly agree. Secondly, for seasonal reasons we can now expect employment to increase; and thirdly, the number of people in receipt of unemployment benefit has fallen during the last couple of weeks from 20,757 to 20,175. For these reasons, it is my confident hope that this problem, recognized as it is by the Government, will be solved, and that we can look forward to a satisfactory state of affairs during the whole of this year.

Then the right honorable gentleman dealt with, standards of living and said that they were not being maintained. Again he used vague phrases and took statistics out of their context, trying to arrive at a conclusion directly opposite to the truth. He said that the calorific value of the nation’s food intake had fallen. That was a magnificent phrase! Then he tried to show that food consumption in Australia was gradually diminishing. 1 make two comments on that; first, that we lead most of the world in terms of food consumption. There is a greater food consumption in Australia than in the United States of America, Canada or the United Kingdom. Secondly, our food consumption at present is greater than it was during pre-war years. It is true that there has been a fall in food consumption in recent years, but that does not mean there has been a fall in what is generally termed consumption as a whole. The right honorable gentleman’s argument does not apply to all the things that a person wants in terms of clothes, entertainment and, if you like, drink. It does not apply to all the other things that go to make up the statistical concept known as consumption. In fact, if the right honorable gentleman had gone a little further with the national income statement he would have seen that total personal consumption rose from £3,000,000,000 in 1954-55 to £3,327,000,000 in 1955-56 and to £3,529,000,000 in 1956-57. The total consumption of the things that a person wants and chooses for himself has gradually increased, while food consumption and - if you care to put it in this way - the calorific value of food consumed has diminished. 1 do not want to mention too many of these figures, but if honorable members look at some of the figures presented by the Treasurer they will see that there was an increase by more than 25 per cent, in consumption between 1953-54 and 1956-57. That is not all. Expenditure on the purchase of motor cars was 24 per cent, greater in 1956-57 than in 1953-54. If we look at expenditure on entertainment, in theatres, alcohol, petrol, and many other things, we find each of them taking up an increased percentage of the total expenditure on consumption. I do not think these figures point to the conclusion that the right honorable gentleman would like us to draw.

What was the Government to do? Should it have acted in the way implied in what the right honorable gentleman has said? Should it have compelled people to eat more? The people had a choice to buy what they wanted. They had money to spend and. so far as I and the Government were concerned, we had no intention of ramming food down their throats. We had no intention of telling them what they should do with their money. We were prepared to leave it to their personal choice. If they chose to buy refrigerators and clothes instead of food, so far as 1 am concerned, they were perfectly entitled to spend their money in that way. The Government does not believe in control and compulsion; it does not believe in forcing people against their wills. I am surprised that the right honorable gentleman chose the question of food consumption to show where the Labour party stands so far as a free and liberal economy is concerned.

Looking at the two basic arguments of the Opposition, 1 say that totally different conclusions can be drawn from the facts. The Menzies Government stands for full employment and will live up to it. lt stands also for a policy of raising the standards of living. I personally think that the facts point to the conclusion that those standards are slowly rising, and I am very hopeful that this year will show an even better position.

The third proposition put by the Leader of the Opposition related to the running down of the economy. He said that, because of the past policies of the Government, there was a tendency for the economy to run down and for the rate of increase of production to slacken. I need do no more than quote what my colleague the Treasurer said during his budget speech -

In recent months, however, there has been a degree of revival in most of these sectors and housing in particular is now well on the way up again. Clearly, too, sales of most classes of consumer goods are rising and, in the meantime, the output of most of the basic secondary industries has continued to increase.

Is that an illustration of an economy that is running down or is it a picture of an economy that is now on a healthy level and which we hope will reach a more healthy level in the future?

Average weekly earnings increased by about 5.7 per cent, between 1955-56 and 1956-57 and, despite what the Leader of the Opposition said, the cost of living rose by a slightly lower percentage. The latest figures I can obtain show that consumption expenditure has been rising. That is totally different from what the right honorable member for Barton said last night. Wholesale sales, as recorded in returns under the sales tax legislation, were 8 per cent, greater in the recent March quarter than in the- corresponding quarter of 1956. Retail sales for the March quarter - the latest comprehensive figures available for this field - show a recovery in sales of clothing, hardware, electrical goods and furniture. I put the proposition to honorable members that the facts disclosed, not an economy that is running down, but a healthy economy, one that is in fact running up - the kind of economy that the Government aimed at eighteen months ago and which, I am glad to say, it has been successful in achieving.

I come now to the last of the arguments of the Leader of the Opposition, namely, that the Government employed budget and financial methods which were not appropriate to the Australian economy and which had the effect of reducing the standard of living. Re made four arguments. I shall not touch on all of them. Amongst other things, he said that it was the intention of the Government to reduce consumption, and that interest rates were too high. Thirdly, he stated that public works expenditure had been cut, and fourthly, there was a criticism of the taxation policy of the Government. First, may I take the problem of consumer demand and of consumption expenditure? It was the policy of the Government to stop not the increase in consumption but the over rapid rate of increase. We did not want consumption to increase too much for the very good reason, as I stated at the beginning of my speech, that we faced balance of payments problems and rising costs. That meant that we were spending overseas more than we were earning and more than we could afford. We were putting a little too much into consumption and not enough into investment, and therefore we had to cut down the rate of rise in consumption expenditure - not so much the actual aggregate amount but the rate at which it was increasing. These purposes and intentions have, in fact, I believe, been achieved, with great benefit to the community because, as the Treasurer has said, we now have a fairly stable economy. We see the stage set for an impressive move forward in production.

There was one section that I personally think needed attention, and it has received attention in this budget. That was in the field of private capital investment which had fallen from 19 per cent, of our gross national product in 1951-52 to 16 per cent, last year. I personally think that, as a result of the action taken in this budget, we will find a fairly substantial improvement - one that should bring back confidence to the hesitant sectors of the business community.

The second point of criticism of our financial policy related to interest rates. I am well aware that the Labour party has three arguments in its armoury on the budget. One is, “ Let our head go on expenditure “. The second is, “ Once you have done that and you have got into an awful mess, control the economy “. The third is this howl about keeping interest rates down. I for one cannot understand why Labour members have not understood all that has been said on this side on the matter of interest rates. After all, what are interest rates? They are the amount that you pay to a person if you want him to lend you money. They are the reward given to him for trusting you with the money that he lends to you. Like all other things in a market economy, money supply responds in some way to the laws of supply and demand. If you cannot get people in a free economy to lend, you raise the interest rate and induce them to give you the money you want for your purposes.

What happened when interest rates rose? The Commonwealth Bank, the proper instrumentality, was, during the last two years, 1954-55 and 1955-56, strongly supporting the bond market. That meant it was purchasing bonds in the open market and giving the people the money so that the people themselves had the money to spend. May I state for the benefit of the honorable member for Hindmarsh (Mr. Clyde Cameron), who is interjecting, that at one stage they were putting into the economy about £1,000,000 a week. What was the effect of that? The effect was that unless it was met by increased production, more money was going into circulation, and the result of that was to push up prices and to cause the inflationary spiral that the Government was anxious to prevent. If interest rates had not gone up and it was a conscious action of the central bank and the Commonwealth Government that permitted interest rates to rise to a moderate level, I am quite certain our difficulties today would have been considerably accentuated.

T mention two matters to show the success achieved by the Government in carrying out this policy. Yesterday, the

Treasurer announced that the £30,000,000 Commonwealth cash loan had been oversubscribed by £1,400,000, and to-day we read in the newspapers that savings banks deposits increased by £7,600,000 during the month of July. That is evidence of the success of the Government’s policy and its achievement in two fields where it wished to achieve successful results.

I come now to the last criticism, and that is the argument of the Opposition as to whether this Government has a policy. I think I have stated sufficient facts to indicate that in my opinion, as a person who studies these matters fairly closely, we can sustain full employment and we can improve living standards. There were, I admit, one or two pockets to which we had to give special attention, and I should now like to turn my attention to them. Let us look first of all at public works programmes and reimbursements to the States. Let us also look at the Commonwealth capital works programme. Mr. Chairman, this year these payments have increased by £50,000,000 - State public works, £8,000,000, approval for local government works, £8,750,000, Commonwealth civil works, £16,000,000, taxation reimbursements to the States, £16,000,000, and special grants, £1,000,000. When we take all the other factors into consideration, including the increase of £16.000,000 in the National Welfare Fund, and the taxation concessions for companies, I personally think that it will be agreed that additional purchasing power and incentives have been provided and that the stage has been set when we can once again think confidently in terms of prosperity and progress. I do not like to quote other people, but if I can get the latest information from what might be regarded as an independent and somewhat judicial authority, I do so. Let me quote from to-day’s report of the Commonwealth Bank of Australia. This is what the Commonwealth Bank Board says of our economy -

The year 1956-57 was marked by a dramatic improvement in the health of the Australian economy.

I hope the Leader of the Opposition will note that comment -

The growth and development characteristic of the post-war period continued but on a sounder basis and with a considerable easing of inflationary pressures.

There is an independent and objective statement. I think that we are in as healthy a state to-day as we have been at any time in the post-war years. 1 think that the action taken by the Treasurer and the Government in this budget will set us on the way to prosperity again. I say this: If the business community will accept the fact that the future is bright; if it will have the confidence and initiative to get ahead with the job, we can make mammoth strides forward in terms of prosperity, and better our living standards.

I have heard Opposition members mumbling continually about the prospects of the future, caterwauling like so many lost souls during the last days of Babylon. I have heard them ululating about the bleakness of the future until I am sick of listening to them. If that is the best the Opposition members can offer, they have no right to be sitting in Her Majesty’s Opposition, and can never be considered as an alternative government.

This Government is confident that not only what has been done, but also what is proposed in the budget, will be the basis on which the business community should have full confidence in the future. I shall conclude with a simple statement. My colleague, the Minister for Labour and National Service, has sustained full employ ment as no one else has ever done. I am certain that we all can have better standards of living in the future, particularly if the Labour party will adopt a policy of quiet responsibility.

Melbourne Ports

.- In view of the gross distortion by the Minister for Primary Industry (Mr. McMahon) and the Minister for Immigration (Mr. Townley), who spoke last night, I feel that it is necessary to recapitulate to some degree the arguments that were put forward by the Leader of the Opposition (Dr. Evatt) in launching Labour’s attack on the budget. I propose to begin at the place where he began when he said that he disputed the contention of the Treasurer (Sir Arthur Fadden) that, during the past year, our economy had gained greatly in stability and strength. The Opposition disputes the existence of stability in the Australian economy and argues that if economic strength has existed, it has applied only to certain profitable undertakings in the community and has not spread to the ordinary people.

Both Ministers to whom I have referred cited statistics, and I propose to use the same figures, except that 1 hope to be a little more analytical and objective in interpreting them. Let me take first the employment figures in June last. Both Ministers carefully aggregated male employment and female employment, because only by so doing could they arrive at the answer they wanted. I submit that in a family community such as ours, real national prosperity is measured not by the number of women who go to work but by the number of males in employment. In June, 1956, the total number of males in employment was 2,083,200. In June, 1957, twelve months later, despite the fact that the population had increased by 200,000 and the potential work force by at least 60,000 males, the total number of males in employment was 2,072,500, or 1 1,000 fewer. Yet, the Minister for Primary Industry, a responsible member of the Government, has spoken of a record level of employment! It is obvious that he has made it a record only by adding the number of females in employment.

This Government prides itself on believing in the value of private enterprise. If it considers the figures carefully it will find that the aggregate has increased because of the additional numbers in government employment, not in private enterprise. In “Treasury Bulletin No. 7” for July last, and also in the White Paper on National Income and Expenditure 1956-57, which is a very important document, the matter is stated very clearly. People who talk only about aggregates and do not put the position in its proper perspective by also referring to either the number of people involved, or the way in which prices have risen, grossly distort the situation that exists in this country. The Leader of the Opposition did not say at any stage of his speech that consumption in the aggregate had not risen.

Sir Philip McBride:

– Surely that is the test.


– It is not. The real test is the purchasing power of money, relative to the population. The supporters of the Government did not indicate that although consumption had risen by 6 per cent, in the two periods referred to, retail prices also rose by 6 per cent, and the population increased by 2i per cent. One does not need to be a mathematical wizard to deduce that in an expanding economy, such as the Government professes to desire, the test ought to be concerned with average standards. There are now 2i per cent, more people or, as the Leader of the Opposition put it last night, there are 200,000 more mouths to feed. The total consumption has risen by 6 per cent., but prices have risen by a like percentage, which means, in terms of purchasing power, that the same amount of money has had to be distributed among a greater number of people. Can that reasonably be regarded by any government as indicating either economic stability or strength?

Food consumption figures have been grossly distorted in this debate, and in this respect I ask honorable members to turn to page 9 of the White Paper on National Income and Expenditure 1956-57, where they will see that from 1948-49 to the present time, a period of eight years, expenditure on food rose by more than 140 per cent., compared with an increase of prices of approximately 125 per cent.; but in the same period the population increased by about 22 per cent. Those honorable members who are interested in mathematics may care to work out the problem for themselves. To maintain in 1956-57 the expenditure per head on food that obtained in 1948-49 would have required the expenditure of £120,000,000 over and above the figure that has been stated. I do not argue that there will not be, from time to time, movements in consumption, but at least let us be honest in interpreting the statistics. The budget cannot properly be analysed unless we take into account both the growth of population and changes in prices during the periods under examination. As 1 have said, there has been gross distortion on the part of two responsible Ministers regarding the true economic position of this country. I had not intended to go into these details to-night, because I felt that they had been accurately dealt with by the Leader of the Opposition, but it has seemed to me that in order to gain a little cheap publicity, and also to take the eyes of the public away from the real issues, the Government has descended to deliberate distortion and has attempted to play down the powerful case that was nut forward last night on behalf of the Labour party.

I now turn to another section of the budget. The Treasurer, in the course of his budget speech, rightly said that the budget did not cover the whole range of policy. He said that, as well as budgetary matters, other matters had to be taken into account, and he expressed the opinion that banking policy and trade policy also were important. On the subject of banking, I wish to pose a question. This is not the time to discuss the proposed banking legislation, but I ask this Government, which claims that the country is so prosperous, why it wants to make changes in the Australian banking system. If banking policy is important to the Government, surely the Treasurer should have indicated why he wants to alter the banking structure. Similarly, with regard to trade policy, the Government might have given us a little more information as to the likely impact on Australia of the Japanese Trade Agreement which has been debated in this chamber during the past week or so.

The Treasurer goes on to say -

It was chiefly to budgetary measures that we turned when, eighteen months ago, the economy had become unbalanced and we had to lay a restraining hand on the excessive rate of business and community spending.

I pause here to ask what, in fact, was achieved by those measures which were taken by the Government nearly two years ago, and whether they did in fact produce the results that the Government has claimed. It is hard to know what the “ excessive rate of business spending “ means. How has that so-called excessive rate of business spending been affected by the Government’s measures? Has it been affected for the better by the measures taken two years ago? Similarly, what has been the effect on community spending? I assert here that, as the Labour party claimed several years ago, the Government in its economic measures has not been reaching down to the root problems of the Australian economy, and that the measures, as the Government has chosen to apply them, have not fallen with justice where they ought to have fallen. They have penalized people who ought not to have been penalized, and have let go free large sections of the community.

Again, I ask honorable members to ponder over some of the official figures given in the White Paper on National Income and Expenditure mentioned by the Minister for Primary Industry (Mr. McMahon). Table C, on page 17 of that document, deals with company income. It contains an analysis of company income in each of three forms - the profits derived by manufacturing concerns, the profits of wholesale and retail trade organizations, and the profits of other companies. In 1948-49, the profits of manufacturing concerns were £91,000,000, the profits of wholesale and retail trade organizations were £60,000,000, and the profits of other companies were £63,000,000. Seven years later, in 1955-56, the last year for which the broken-down statistics are available, manufacturing profits had risen from £91,000,000 to £274,000,000- three times as much. In the same period wholesale and retail trade profits had risen from £60,000,000 to £143,000,000, and the profits of other companies had risen from £63,000,000 to £1 13,000,000. If honorable members like to do a little arithmetic, and make what seems to me to be a not unreasonable test, they might arrive at this conclusion. If the same proportionate increase had applied to manufacturing and to wholesale and retail trade profits as prevailed for other companies, that is, if their profits had risen only at the same rate as those of other companies, manufacturing profits in 1955-56 would have been £111,000,000 less and wholesale and retail profits would have been £35,000,000 less. In other words, in aggregate, they would have derived £146,000,000 less, which would have meant that £146,000,000 less would have been charged in prices to the consumer. Or if, on the other hand, the wages going to people in manufacturing concerns, which rose from £382,000,000 in 1948-49 to £952,000,000 in 1955-56, had risen in the same proportion as the profits going to manufacturing concerns, the wageearners in these industries would have derived £190,000,000 extra. I am not saying that either of those need necessarily have been the solution; but at least it does seem to me to point to this, that the biggest inflationary impulse in the Australian community is corporate activity, particularly in the large concerns - concerns which, as the Americans term it, are able to administer their own prices. That is, they can virtually charge what prices they like, because nobody can really compete with them. In theory, anybody who can get hold of £10,000,000 or £12,000,000 can set up in competition with big concerns like Broken

Hill Proprietary Company Limited or General Motors-Holden’s Limited. The difficulty, of course, is to get the necessary £10,000,000 or £12,000,000. 1 submit that, in the Australian economy, there is not, as yet, sufficient statistical evidence available to enable a government properly to take some of the economic measures that have been taken by this Government. And because certain measures have been taken, and have been taken improperly, their impact has fallen on sections of the community different from those it was intended to affect. This means that the victims of the economic strife in Australia are the wage-earning section and the people dependent on fixed incomes, particularly pensioners, because they have no means of insulating themselves against the economic blight that has been the policy of this Government.

To illustrate further the kind of thing I think the Government needs to go more closely into, I direct the attention of the committee to a very important publication of the Australian National University in Canberra - and it is good to see that at last some things are coming from that important institution. This publication gives an analysis by Mr. A. R. Hall. Fellow in Economics, of Australian public company finances over a number of years. He has taken a sample of 100 large companies operating in Australia, covering the retail trade and wholesale trade, but mainly covering manufacturing industries such as those which produce bricks, timber, iron and steel, vehicles, food, drink and tobacco, clothing and textiles, newspapers and paper, rubber, chemicals and gas and those engaged in engineering and brewing. In all, a sample of 100 companies having assets, in 1955, totalling £964,000,000, of which £814,000,000 was in the field of manufacturing. The list is a very representative sample indeed of Australian activity, and just how important that sample is can be seen from the aggregate profits derived by those undertakings. They aggregate a considerable proportion of the total company profits earned in this country. In 1955-56, for instance, this group of 100 companies had aggregate net profits, before paying tax, of £111,000,000, which is in the region of 20 per cent, of the total profits derived by something like 30,000 companies in Australia. So, one can see that when honorable gentlemen opposite talk about private enterprise there is a lot of difference between the sort of concern that the Minister for Immigration (Mr. Townley) talked about last night as having so many thousand shareholders and so many thousand employees, and the sort of concern included in that sample. I would say, in rebuttal of that kind of argument, that the significant difference between an employee of a company and a shareholder of a company is that the employee is virtually wholly dependent on the company for his economic existence, whereas the shareholder is not, because there are very few shareholders who are entirely dependent on income from dividends and have no other means. That can be proved by resort to statistics. But the majority of the employees have no other means of sustenance apart from the wage they derive from their employers.

Mr. Hall has made an analysis as late as 1955-56, and he points to the fact that the so-called monetary measures that have been adopted by this Government to stabilize the economy and to reduce what it has called investment have not hit such undertakings. As he says, they rely to the greatest possible extent on retained profits for their expansion, and consequently they have not been hit in any way by the measures that the Government has adopted.

One of the features of this Government’s policy has been its restriction, through the central bank, of the aggregate amount of bank lending in the community; but Mr. Hall points out that, despite the restriction, some of these concerns were able to obtain significant increases in bank overdraft. Last year the increase was £8,800,000 - at a time when total bank advances in this field were falling. It means, of course, that if this group gets more, and a restrictive credit policy is being followed, the impact falls not on the larger organizations but on the smaller organizations less capable of defending themselves. Mr. Hall added - and this is significant in view of the Government’s aim to reduce investment expenditure -

It would appear that the increase in expenditure on land and buildings by the group is roughly in line with the national income estimates.

Their expenditure on plant and equipment appears to be disproportionately large.

These facts are a significant example of the inadequacy of this Government’s policy.

Sir Philip McBride:

– That proves nothing.


– If the Government applied itself to this problem a little more than it is applying itself to the defences of this country, those facts should prove a great deal. Theoretically, in the last twelve months, as a result of the Government’s policy, three separate things have occurred at once. First, the Government has had a budget surplus. If Government supporters were to read carefully the financial documents that were presented with the budget, they would note that last year the Government took out of the public pocket in aggregate £16,000,000 more than it distributed. According to economic jargon, that was supposed to be an anti-inflationary measure. Secondly, there was restriction of credit, as can be seen by the figures for bank advances over the period. In June, 1956, bank advances totalled £895,000,000, and by June, 1957, they had declined by £27,000,000 to £868,000,000- again, theoretically, a deflationary measure. Thirdly, as the Opposition has pointed out, there was slack in employment and there were surpluses of certain kinds of goods on the market. According to the law of supply and demand, which the Government applauds when it suits it, they, too, are supposedly deflationary factors.

Despite all those things, the degree »f inflation last year was 6 per cent. Six per cent, does not seem to be very much, but it means a lot when the average wage, which the Government is now so eager to talk about, is considered. No longer does anybody talk about the 40-hour week which the unions thought would give employees a decent standard of living. To-day, no one can live on what he earns in 40 hours. The talk now is about the average wage, which means payment for 40 hours plus payment for a certain number of hours’ overtime. Even then, many wives have to go to work to supplement the family income. A 6 per cent, increase in prices means that, whereas last year the average wage was £17, next year it will have to be £18 if it is to have the same purchasing power.

This Government says that the average wage is £1 higher than it was twelve months ago and therefore there is strength and stability in the Australian economy. I ask the Minister for Defence (Sir Philip McBride), who interjected earlier, to read carefully the analysis that is contained in Treasury Information Bulletin No. 7 of July, 1957, at page 14. It refers to the variation in employment in major industry groups between May, 1956, and May, 1957, during which time there has been an increase of 200,000 in the Australian population and 80,000 in the potential work force. The analysis shows a decline of 600 employees in the mining and quarrying industries. Will the Government seriously argue that that is a sign of stability and strength in Australia? It shows that the decline in manufacturing industries was 3,400, and in the building and construction industries, 6,000. The number of employees in the transport and communication industry rose by 1,300. Is the country made wealthier by the fact that more people are employed in the transport industry and fewer are employed on building - more people distributing and fewer making?

In the property and finance group, the number of employees rose by 4,000, which, I suppose, is a tribute to the spirit of private enterprise! By contrast, the number of employees in the commerce group declined by 3,300, and in the health and education group increased by 7,900. Because of the impact of immigration, school accommodation in every State is overcrowded, more teachers have been needed, and the total volume of employment has risen. In other miscellaneous groups, the number of employees has risen by 2,200. The net result is that in the period I have mentioned the number of people in employment rose by 2,100. If the Minister for Defence were to look at the analysis for the States, he would be perturbed, as a South Australian, when he noted that in South Australia there are 1,800 fewer people in employment this year than there were last year. In Western Australia, 2,400 fewer were employed. All of these facts, according to the Treasurer and responsible Ministers, are signs of stability and strength in the Australian economy!


– After hearing the factual presentation of my friend, the honorable member fDr Melbourne Ports (Mr. Crean), I almost feel like going out of the chamber and committing hara-kiri. Luckily, I have a somewhat different view of these things from that of the honorable member. 1 congratulate the Treasurer (Sir Arthur Fadden) upon having presented his tenth budget, which constitutes a record in the history of federation. I should like to direct the attention of honorable members to an obvious fact which might have escaped their notice while they were listening to the honorable member for Melbourne Ports (Mr. Crean). I refer to the fact that, during the last eight years of the Treasurer’s administration, Australia has passed through one of the most unprecedented stages of expansion and development that any English-speaking people has known. I quite realize the difficulty of members of the Opposition in presenting a factual case to persuade their unwilling political supporters that they have something that would bring their party back to the treasury bench. In view of the difficulty of disputing the existing conditions in Australia, the figures produced by the Leader of the Opposition (Dr. Evatt) or my friend the honorable member for Melbourne Ports will be hardly effective against the evidence of the eyes and pockets of those people who are now enjoying a wonderful standard of living in Australia.

The Treasurer has had a problem of great complexity in dealing with Australia’s period of expansion. The problem has not been purely an Australian problem. It has been tied very closely to political and economic conditions in other parts of the world. He, his Cabinet colleagues and his advisers have been faced with great difficulties in determining what should be done for the general welfare of the population of Australia. During this period he has had to make a number of decisions, which, because of their impact on the pockets of the people, have not been very well received at times, but I believe that the wisdom of the fiscal measures taken by the Treasurer over the past few years has already been clearly demonstrated. They may not have pleased everybody - in fact, on occasions temporarily they have antagonized various sectional interests - but in view of the strengthening of our national production and the vast absorption of immigrants from the Old Country and the troubled areas of Europe, in addition to our considerable contributions to Common wealth and United Nations defence, the Government’s fiscal policies must receive due credit from any one who is capable of taking an unbiased view, supported by a background knowledge of the immense diversity of movements in international finance, economics, politics and trade.

  1. should also like to take this opportunity of complimenting the Treasurer on the quality of the contents of the economic White Papers that have been produced by the Treasury from time to time. As records of trends and developments, they have been of tremendous value to honorable members, although they may have made the problem of the presentation of a budget speech more difficult, because they have given a preview of Treasury thinking on national problems. However, those papers have provided a background of solid factual information of an objective nature, and even if honorable members on either side of the chamber disagree with certain conclusions, we have been given a picture of the direction of Treasury thinking.

When the budget appeared, there were various press comments about the need for caution to which the Treasurer referred. We read that the budget might be described as unimaginative and unspectacular. I may be in a position to express an opinion on this question of responsibility for the direction of national finance. I would relate it to the position of a trustee of a private estate, who must, by virtue of his trust, exercise reasonable caution in the administration of that trust. The exercise of caution has never been considered a culpable misdemeanour in the administration of the affairs of a trust. A trustee who was inclined to take a tilt at the turf financiers, or to invest trust funds in rather doubtful concerns, would never be regarded with great confidence by the beneficiaries of the trust. So it follows that a nice sense of balance is necessary in the direction of national finance, particularly because, as we have seen to our cost in the past, our own problems cannot be isolated from the international trends to which we, as a nation, are subject.

We have often heard well-meaning citizens say, when seeking funds for some particularly meritorious institution or developmental scheme, “ You can do it in war-time. Why can you not do it in peace-time? “ I suggest that this introduces a thought which is particularly appropriate in relation to Australia’s present economic position. While, obviously, its examination would require far longer time than the Standing Orders permit me to expend, it does relate directly to the provisions of the budget now before us. To reduce this proposition to its simplest terms, I would say that the vast unproductive national effort required by two world wars is basically the cause of the post-war international surge of inflation which we have faced and which is shown so clearly by the falling value of money, in spite of the legislative measures we have invented to restrict and damp down the fires of internal demand and costs.

To-day we are not actually engaged in a war, but we have to play our part in providing for our own security, to accept our share of responsibility for overall Commonwealth defence and to meet the obligations which we have assumed under the various treaties to which we are committed. Australia has been forced into a position where we must accept financial responsibility for defence in our part of the world. The direction of defence expenditure is a problem of great difficulty in these days of revolutionary advances in weapons and changing political situations overseas. The Government has been subjected to continuous criticism from the Opposition on this matter of defence expenditure, but when I cast my eyes round the Opposition benches and realize that a certain number of Opposition members - I do not see many of them here to-night - are recorded in “ Hansard “ as having done all in their power to oppose Australia’s defence preparations in the prewar period of 1938-39, I realize just how much their defence policy is based on political expediency.

Mr Luchetti:

– It was the Curtin Government’s policy that saved Australia.


– If the honorable member for Macquarie knew what the late John Curtin said about the previous government’s defence measures, he would pay tribute to those people who laid the foundations for Australia’s defence effort prior to and shortly after the outbreak of World War II., and made it possible for the subsequent Labour government - I say this with all due respect - to cash in on the good basis and foundation presented to it, after the

Labour party had tried to undermine our war effort. However, I do not wish to be diverted from my discussion.

We must accept the national responsibility of expenditure for defence. In these days of rapid development of new weapons and of methods of directing them to their targets, quite obviously the defence effort must constantly be subject to revision. It is also obvious that the production of arms and vehicles for our services and, what is more important, the training of our service personnel, cannot be undertaken in a day. Accordingly, we must have a longterm plan, designed to produce a war effort based on an agreed expectation of strategical and tactical possibilities. The constant changes taking place to-day - I think everybody will agree that extraordinary advances are taking place in military science - make the problems of defence thinking and expenditure extremely difficult. But it would be completely unrealistic to condemn such expenditure in the past as money wasted. Similarly, no responsible government can afford to adopt the line that, because of the difficulty of foreseeing the future shape of military developments, it should do nothing about the national defence effort. We know at least that we have the responsibility of providing an element of the Seato force - a force which I believe everybody hopes will never be used. The defence provision in the budget amounts to £190,000,000, a figure steady in comparison with the figures provided in the past. I believe that no self-respecting government could avoid this inescapable financial responsibility.

I turn now to the next two main items of expenditure for which the Commonwealth is directly responsible - war and repatriation services and payments to the National Welfare Fund to cover the various social services. These two items amount to almost £373,000,000, and I do not seriously believe that any citizen of Australia would suggest that this expenditure is too high and should be reduced, though it amounts to almost 30 per cent, of the total budget. The next very substantial item is the allowance of £266,000,000 for payments to the States, including £190,000,000 of tax reimbursements under the uniform tax formula, £19,500,000 in special grants and £33,000,000 for roads under Commonwealth aid roads legislation.

Mr Daly:

– Not half enough!


– How often do we hear Opposition members say, “ Not enough! “ Expenditure is always not enough, but revenue is always too large. In other words, the honorable member for Grayndler (Mr. Daly) is always in the happy mood of plenty of spending but little extraction. With the present plans for development which face this Government as a responsible federal government, it is almost unrealistic to suggest that these payments to the States should be reduced. Provision is made out of revenue for Commonwealth works and services to the extent of £122,000,000, including a very vital amount of £35,000,000 for war service homes. I am sure every one will appreciate the importance of the increase of £5,000,000, which will be of immense value in reducing the number of persons waiting for finance through the War Service Homes Division to build homes. I pay tribute to the decision of the Government to increase this grant. Another item of real significance to the general overall development of Australia in both the power and irrigation aspects is that of £18,300,000 for the Snowy Mountains authority. In passing, I should like to say that we who have had the opportunity of meeting the Commissioner of the Snowy Mountains authority realize that Australia owes a great debt to Sir William Hudson for the work he is doing in this great scheme.

When we analyse the direction of budget expenditure, we find that, with the exception of departmental expenditure and some of the lesser items of miscellaneous expenditure, it is extremely difficult to make any real reduction. I accept the possibility that some attack could be made on departmental expenditure and I feel that it is a responsibility of the Government to pursue that possibility. When we face up to the major items that I have enumerated, though we may criticize the vast amounts involved, it is extremely difficult to visualize how we could make a substantial reduction which would ease the burden on the taxpaver. Tt is extremely difficult to maintain steady progress and a really significant defence effort, to provide for an increasing population. to honour our obligations in regard to war and social service pensions and benefits and at the same time to make any significant reductions in taxation. How ever, one practice has been adopted for a number of years, and that is the practice of providing for future development out of current revenue, or, in more practical terms, making the people of to-day pay for the benefits of the future. Two items occur in the budget in connexion with this subject - the vote 1 mentioned previously of £122,000,000 for capital works and services and the provision of £119,000,000 towards loan consolidation and investment reserve. I find no more pleasure in paying taxation than anybody else and, if we were passing through a period of reasonably stable economy, I would be strongly of opinion that the benefits of the future could well be paid for by the citizens of the future and that finance for these developments should come out of capital loans rather than out of current revenue.

Two substantial reasons, which I believe are of great importance, influenced the Government in its decision to finance capital works out of revenue. The first is that we are now passing through a period of vast national expansion, which, I believe rightly, has been entered upon as a means of selfpreservation. However, it has brought in its wake a constant pressure of internal inflation at a time when inflationary forces are making their presence felt throughout the world. I believe that, if the Commonwealth were to seek new money for public works, in competition with those who are seeking funds for private investment, the demand for the available resources of labour and materials would be increased, and the resulting competition for the available labour and materials would cause prices to rise beyond the capacity of the public to pay.

The second justifying reason for the Government’s policy is the necessity for the Commonwealth to support State loan programmes. Many of the things urgently needed to improve living standards in a civilized community are within the purview of the States, notably housing, education and transport. The money available in Australia for investment, together with the dribble of capital coming from overseas, is not enough to satisfy the demand, and it has become necessary for the Treasurer to budget for surpluses in order to obtain funds with which to finance important projects in these fields. If all these needs are to be met from revenue, it is clearly impossible to reduce taxation substantially. In effect, we are obliged, with some justification, to pay an additional insurance premium to protect our national development programme and our national security. I am firmly convinced, Mr. Temporary Chairman, that Australia’s future safety depends on our having a large, technically efficient population in a well-developed country.

Although direct taxation has not been substantially reduced, significant reductions have been made, notably the reduction of 6d. in the £1 in company income tax, and the reduction of sales tax on certain articles that are of real importance in the furnishing of homes. The Treasurer has given more attention to limited taxation reductions to encourage certain sections of industry than to overall tax reductions. The Leader of the Opposition attacked the reduction of company income tax and the depreciation allowance proposals as a gift to big business, and, in the next breath, began a dirge about the run-down condition of the economy. It is interesting to note his condemnation of this genuine attempt by the Government to increase commercial activity. The Opposition directed attention in a recent debate to the allegedly precarious position of certain industries that are supposed to be threatened by overseas competition. Yet, in this debate, Opposition members attack concessions that would help to alleviate the conditions that they say exist!

I congratulate the Treasurer on his decision to raise the limit for exemption from pay-roll tax, although I should have preferred to see the tax removed altogether, and the loss to revenue recouped by other means. I think that commerce and industry generally would have preferred the abolition of this tax to the reduction of company income tax. Pay-roll tax was imposed in 1941 as an expedient in order to obtain additional funds to finance child endowment. That alone was its justification. It is true that it was introduced at a time of great financial strain when the normal fields of taxation were being exploited to the full to finance the war effort. I believe that the child endowment scheme, which has functioned for years with tremendous benefit to Australia, was a very worthy object. But the basis on which this tax was imposed initially was, I believe, completely wrong, and I suggest that the Government should seriously consider abolishing it.

The Government has already demonstrated its willingness to vacate certain fields of taxation, such as the land tax and entertainment tax fields, and 1 hope that, in the near future, while I am still a member of the Parliament, the Government will vacate the pay-roll tax field. It is obvious that the £50,500,000 expected to be collected in pay-roll tax in the current financial year would not be totally lost to revenue if the tax were abolished, because pay-roll tax payments are deductible in the assessment of both company and personal income tax. Moreover, this tax is paid by both State and municipal instrumentalities, and if it were abolished, the payments made to the States by the Commonwealth under the tax reimbursement scheme could be reduced. The pay-roll tax directly affects the cost of goods and services, and if it were abolished, the effect on price levels would be beneficial. That is a matter of great importance at the present time.

I would like to say, in conclusion, that we in Australia are inclined to think of our economic problems as being problems of a country completely isolated from world trends. One would think, to hear Opposition members, that Australia could live in a little backwater of its own, completely divorced from the problems of the rest of the world. Contrary to the statements made by the Leader of the Opposition, we have established very high living standards in this country.


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

Smith · Kingsford

– I should like the people of Australia to realize that, although the committee is debating a budget providing for an expenditure of £1,320,000,000 in the current financial year, only eighteen members of the Government parties are present. Firstly, I wish to voice my disgust at the miserable treatment meted out to the poor and needy people - those who depend upon tensions for an existence. Indeed, their life is only an existence. This Government has contemptuously dismissed the appeals of those people for a generous increase in pensions, and has callously thrown them a miserable addition of 7s. 6d. a week to their pittance. An examination of the budget indicates that the Government has a 7s. 6d. complex. An additional 7s. 6d. a week for pensioners will give them ls. a day more. Nowadays, most school children are given ls. a day spending money by their parents. The Government has decided that an additional ls. a day will enable the old people in our community to sustain themselves. They gave pensioners ls. a day, or 4d. a meal. I ask honorable members to consider their generosity, but 1 will not go into details now because enabling bills will be brought down later and we can discuss these matters then. lt is interesting to compare the treatment that has been meted out by the Government to the pensioners with the consideration it has given to the big companies. Additional pension payments in the next financial year will amount to £16,000,000. That is a paltry pittance out of a total budget allocation of £1,320,000,000. During the past twelve months, big business has brought tremendous pressure to bear upon the Government, and it has abjectly agreed to allow the big business interests £14.500,000 in company tax reductions and £26,500.000 for depreciation allowances - everybody knows what the big companies can hide behind a depreciation allowance - or a total of £41,000,000. Of course, these big businesses might need those concessions, but the pensioners living in single rooms, and not asking very much in the way of luxuries, also have their needs, and they are to receive a miserable ls. a day. The electors of Australia should wake up to the way this Government is taking money from them in taxes and how it is distributing its revenue.

I propose to contrast the treatment that has been meted out to pensioners with that accorded to the wealthy companies. Wealthy supporters of this Government made its election to office possible, and they have to be paid off. The monopolistic friends of the Government who have supported it for the past seven years want their price. This Government has shown great audacity in handing over the assets of the Australian people to its wealthy supporters. To say the least, its action in so doing is scandalous. I believe that a royal commission should be set up to inquire into the circumstances surrounding, not the sale, but the giving away to wealthy supporters of the valuable assets of the nation.

During the past seven years, Australia has been favoured by bountiful seasons. World prices have been comparatively high. In consequence, our primary producers have had a ready market, especially for wool, which has remained stable. Production has increased and the result has been a record income from primary products. One would have thought that the Government would have seen the wonderful opportunity it had to put the country in a position to meet adverse conditions which are certain to follow. One would have expected that plans would have been drawn up to meet the sudden emergency that will arise sooner or later. Such planning calls for ability which this Government sadly lacks. Not one member of the Cabinet has shown any ability or the vision to grasp the golden opportunity that has presented itself to place Australia among the foremost nations of the world. All of them have been carried away by the glamour of office as Ministers and as members of the Commonweath Parliament. Their egos are swollen as the result of the manner in which they are treated by big business. The heads of big business know the weaknesses of these young, egotistical Liberal members.

Mr Ward:

– The storm troopers!


– Yes. These weaknesses are inherent in the make-up of young Liberal and Australian Country party members who are aspiring to Cabinet rank. They are susceptible to a build-up in the press, glamorous photographs and cocktail parties. They like being fawned upon by the socialites, who invite them to all sorts of social functions. When all this has happened, they are ready for the treatment.

Mr Ward:

– They are softened up.


– That is true. Of course, big business must get its pound of flesh. Kites are flown in the press at intervals to sound out the public reaction. Then the axe falls and, in the sacred name of private enterprise - which this Government claims to support as its policy - government undertakings are handed over at bargain prices.

Mr Killen:

– Who wrote that?


– The honorable member would not be capable of doing so. We need a royal commission to inquire into, not who wrote my speech, but who handed over profitable government businesses to private enterprise. The sacred cow of private enterprise has no objection to the Government running enterprises that are not paying. Let us recall the list of enterprises that have been handed over to private interests in the past seven years, during this Government’s term of office. First, there was the destruction of the project at Glen Davis, where the Labour government had been endeavouring to establish a source of local oil supplies by the treatment of the enormously rich shale deposits in that area.

Mr Killen:

– You do not say!


– I do say, and I might add that all the valuable machinery there was dismantled and sold at bargain prices. This sacrilege occurred at a time when the United States of America was spending 50,000,000 dollars a year developing her shale oil deposits, which were not anywhere near as rich as those at Glen Davis. Our controlling shares in Commonwealth Oil Refineries Limited were sold at the same time, no doubt to the same individuals who were favoured with the Glen Davis bargain. Simultaneously, all records and information on the search for oil that had been collected by the appropriate government department, at heavy cost to the taxpayers, were handed over free. Those who obtained the data also received, at bargain prices, the oildrilling equipment that had been secured by the Labour government for drilling for oil on a national basis. All this shows the extent of the influence of the oil octopus on members of the federal Cabinet.

I move on to the sale of the shares of Amalgamated Wireless (Australasia) Limited, also at bargain prices, to the big British General Electric Company Proprietary Limited which, with the daily press monopoly, subsequently obtained a stranglehold on television licences. Now, I come to the scandal associated with the sale of the whaling station which was owned by the Commonwealth.

Mr Cleaver:

– Ah! Here it comes!


– Ah! The terms of sale allowed for payment for the assets to be made out of profits earned by the buyer. These profits were assured because the Minister agreed to double the quota of whales that might be caught and treated. It certainly pays to be associated with a Liberal Cabinet and have friends therein.

Then I might mention the astonishing agreement with Australian National Airways Proprietary Limited. The Government agreed that A.N.A. should be granted a government-guaranteed loan from the Commonwealth Bank. It is interesting to note that the repayments which were originally agreed upon have not been made and A.N.A. still owes £400,000 to the Government under the terms of that agreement. The company was granted £3,000,000 to build up an obsolete air fleet to compete with the wonderfully efficient Trans-Australia Airlines. A.N.A. was also given the carriage of 50 per cent, of Her Majesty’s mails, in an endeavour to run T.A.A. out of business. Concessions were also granted to A.N.A. as a result of the infamous agreement on routes, the best paying ones being given, of course, to A.N.A. Taxation owing by A.N.A. to the Government, amounting to £750,000, was written off. That is a very interesting point for the taxpayers to note at the moment. I invite all the ordinary taxpayers of Australia, who are paying their £30 or £40, to take note of this fact. I hope every one who is listening in to-night will take note of it. That amount of J £750,000 owing by A.N.A. was written off under Government direction. I hope that I all taxpayers will receive the same favourable treatment.

All these things were done by legislation in an endeavour, of course, to wipe T.A.A. off the map. Overdue route charges, amounting to almost as much as the taxation debt, were also written off. A commission consisting of three members was set up. It was chaired by an old Libera] party hack who was prepared to go all the way towards meeting the Government’s wishes. It is now history how that plot failed. A.N.A. put forward further propositions to the Government, and the outcome of its negotiations will be eagerly awaited by all Australians. Of course the Ansett organization now comes into the picture. You can fly Ansett and chance it. It would be appropriate at this stage to mention that A.N.A. is a subsidiary Df companies controlled by the overseas steamship owners, a world-wide monopoly which has enjoyed substantial increases in freight charges, approved by this Government during the last eighteen months. These freight increases, of course, reacted detrimentally on our primary and secondary industries.

Let us move on to another public scandal. How they mount up! I refer now to the sale of the Commonwealth Handling Equipment Pool. Listen to this story!

Mr Killen:

– Well, don’t tell it so dismally.


– Every time I look at your face I feel dismal.




– This sale is to be effected by the calling of tenders, which is a most unusual departure. Many ugly rumours are circulating in the capital cities as to who will be the successful tenderer, and it is strange that in Melbourne, Sydney and Brisbane the same name is mentioned. How come? The name that is mentioned is that of a company which has had a most chequered career in various parts of Australia, but which is still able to enter the charmed circle of Government favourites.

I might also mention the sale of shares in the Commonwealth Engineering Company Limited. These shares are to be sold by a queer method. The company is making huge profits, and no tenders are being called in this instance, because the price of each share is fixed at 42s. This has been advertised all over the Commonwealth. The sale is being handled by two firms of underwriting brokers, one in Sydney and one in Melbourne. The two firms are, however, closely connected, and, needless to say, they are very prominent in government business. It would appear to the average layman that if you are not on the lists of usual customers of these firms shares will not be available to you. However, it may be only my imagination that leads me to this conjecture. But the ugly question still arises: Why are these shares not auctioned? The Government believes in private enterprise, so why does it not sell the shares to the highest bidder? If it has not something to be afraid of. why not give every investor the opportunity to participate? Let us have a fair po and see who will bid the highest price for the shares. Is not the Government interested in a higher price, or is there some one behind the chair who will just walk in aud take the lot? The crux of the situation is that this Government does not want any competition with its monopolistic friends. No wonder ugly rumours circulate, engendering grave suspicion of this Government.

I come next to the sale of assets of the Joint Coal Board. Two highly mechanized mines, making a profit of £500,000 a year, are to be sold at bargain rates. What a travesty it is that the Minister for National Development (Senator Spooner) should sell all our well-developed assets. His function is to develop the resources of the country, not to sell them. He wants to sell all paying concerns immediately, but, of course, those that do not pay are left for the taxpayers. Surely there must be something wrong with the mentality of persons like this responsible Minister, who is supposed to be a man of considerable business acumen. No wonder the man in the street gravely suspects that everything is not what it is supposed to be. The miners have expressed their opinions very forcibly.

T come now to the latest development in the mineral field. This will astound the people of Australia. Fabulously rich bauxite deposits have been located at a place called Weipa in Cape York peninsula by geologists employed by a governmentcontrolled company known as New Guinea Enterprises Limited. The Government found that the productive potential of these bauxite deposits exceeded the wildest dreams of the geologists. An amount of £50,000,000 yearly has been mentioned as the productive potential. One would think that the Government would have been delighted at the prospect of developing such a wonderful dollar-earner, especially when we consider the fact that we owe 350,000,000 dollars to the International Bank. This would have greatly assisted in repayment of that enormous dollar loan. But what did this body of astute businessmen in the Cabinet do? They sold it at bargain prices. To whom? To a monopoly comprised of the British Aluminium Company Limited, Consolidated Zinc Proprietary Limited and Mount Isa Mines Limited. How generous the Government is to its bic business friends! Would not me have thought that the Government would have used the first year’s profits to try to alleviate the plight of the pensioners? May we not be excused for having our suspicions.

No answer has yet been given by the Minister for Supply (Mr. Beale) as to the price obtained for high-class uranium ore from the Mary Kathleen field. Were they sold to the same monopoly? Of course, they were. At what price? The Minister hides himself behind a security screen and the matter is all hush-hush. There is no disputing the fact that the Government is afraid of the outcome if the facts became known. Is it any wonder that grave suspicion grows? The making of these presents to the wealthy supporters of this Liberal-Country party Government is becoming a habit.

It is well to mention here that all American monopolies operating in Australia enjoy all the privileges provided under the reciprocal tax agreement, which was debated in the Parliament in 1951. That agreement allows all those monopolies to escape paying tax on profits made in Australia. They pay no tax! Listen to that, Australia! When that agreement was being discussed in the Parliament I asked the Treasurer (Sir Arthur Fadden) how it would operate. He replied that Australian organizations operating in America enjoy the same consideration. After a little research as to what Australian organizations were operating in America, we found that there were two. One was Automatic Totalisators Limited, which has never paid a dividend, and the other, which was paying a very small dividend was the Kiwi Polish Company Limited. Australians might laugh off the humorous answer given by the Treasurer on that occasion.

Further proof of the Government’s dalliance with the Australian economy is found in the sale, quietly and surreptitiously, of stud merino rams to South African interests bv members of the graziers’ association. The Labour party has resisted, at all times, the efforts of members of that body to sell stud merinos overseas. A total prohibition was imposed, but this Government abjectly acquiesced to the dictates of the powerful graziers’ association and lifted the prohibition on the sale of those rams to the South African Government, thus destroying Australia’s powerful position in the field of wool. That position is now being seriously challenged, t often criticize our daily press, but I wish to pay a compliment to-night to the Sydney “ Daily Mirror “ for the fight it put up with regard to the sale of those rams to South African interests. Day after day, that newspaper fought to prevent this Government from selling such great assets of Australian production. It waged a lone fight, and after a long battle the Government decided that it would cancel the arrangements for any further sales.

But the avaricious monopolies were still not satisfied with the assistance they had received from the Government. They demanded that action should be taken in the industrial field by repressive legislation, and the Government meekly obeyed. The Prime Minister (Mr. Menzies) instructed the then Attorney-General, who is now the Chief Judge of the Commonwealth Industrial Court, to frame amendments to the Commonwealth Conciliation and Arbitration Act in line with that demand. That is how penal clauses were inserted in the act and provision was made for court-controlled ballots for union positions. That amendment was, and still is, most obnoxious to the trade union movement; and it is causing endless industrial friction and disputes. The penal provisions take away the traditional right to strike under threat of heavy penalties to both the union and its members. Of course, the court-controlled ballot is only an instrument by which the Government hopes to take from the trade union movement its inalienable right to conduct its own affairs. That this action was fascist in its concept is proved by the fact that Hitler, in the early days of his rise to power, set up a labour front and through an aide named Ley imposed the same restrictions on ballots for union positions in the German trade unions. Thus he was able to set up “ tame cat “ union leaders who were prepared to carry out his orders without question. About that time our present Prime Minister had just returned from a tour overseas. He was interviewed by a newspaper then circulating in Sydney called “ Smith’s Weekly “ and he openly admitted that he had great admiration for the fascist, Hitler, who ultimately brought the world to ruins at the cost of millions of lives including thousands of Australians. The Prime Minister evidently still admires the tactics he employed in subjugating the trade union movement. The workers of Australia should not forget the fact that the gentleman who, as Attorney-General, framed those amendments, introduced them into the Parliament and succeeded in having them placed in the statute-book immediately appointed himself Chief Judge of the Commonwealth Industrial Court. He had clothed himself with extraordinary powers and then set about using the iron heel.


Order! The honorable member’s time has expired.

New England

– I am sure that even if all honorable members do not agree with the honorable member for Kingsford-Smith (Mr. Curtin) who has just concluded his speech, they will concede that he at least addressed himself with great vigour to the subject before the committee. I do not propose to attempt to follow him through all the cases which he cited and which, of course, have, almost without exception, been dealt with very thoroughly by others who have spoken. However, I intend to comment on one of the first and one of the last points raised by the honorable member, just to give a sample of a different point of view.

The honorable member referred to the fact that companies can stow away certain reserves in the form of depreciation allowances and he suggested that the increased provision made in the budget in this respect is designed specially to favour companies in the making of profits. Any one who really understands the purpose of depreciation allowances and how provision for them is made will realize that since the war depreciation has created a false basis for much of the economy of this country. Let me quote, as a case in point, a company that has £500,000 worth of plant. Let us assume that it has that plant at the beginning of a certain period, say, 1940. The company proceeds to write down that plant on the basis of its valuation. In the writing down, depreciation is allowable for income tax purposes, but as the value of the plant depreciates so, in inverse ratio, do profits rise and tax is levied accordingly. Let us assume that the company is now proposing to renew that plant. In all probability, it will be obliged to pay not £500,000, but something like £2,500,000 or £3,000,000. That is the tendency throughout the business community, and while some companies have taken certain steps in an endeavour to guard against that position, the actual fact is that a false basis and a facade of wealth are being created that could not withstand a certain type of depressing influence.

I pass now to the honorable member’s rather energetic remarks about the wool industry. I cannot repeat his exact words, but the effect of them was that because we had allowed a certain number of merino rams to be exported to the Union of South Africa for research purposes, the wool industry of Australia is failing. Let us examine the position. Twelve months ago, the average price for our wool was 61.46d. a lb. as against 79.66d. this year. In addition, the quality of the clip improved with the result that it realized £478,000,000 this year compared with £392,000,000 last year. Out of a return of £920,000,000 from our exports, wool realized no less than £445,000,000, or 48 per cent, of the total wealth earned by this country from its export trade. I do not propose to mention the other points raised by the honorable member, although they can be replied to adequately.

A great deal of criticism has been directed at the budget, but I pay tribute to the Treasurer and the Government upon its production. It has been called a conservative budget, and a cautious budget and, by the Opposition, a rather niggardly budget in some respects. However, we should bear in mind that the important thing for the country is to endeavour to maintain against the forces of inflation the value of the purchasing power of our currency.

Mr Ward:

– It is about time the Government started to do something about that.


– I know honorable members opposite will use all kinds of statistics in an endeavour to show that the value of our currency has depreciated. I cannot agree that it has depreciated. The average living standards of the community are high and the average wealth of the community has increased. Those facts are borne out by the record savings banks deposits. I do not deny, however, that there has been an impact upon certain sections of the community, people who do not get any real benefit from the increase that takes place in other directions. To illustrate my point, I cite what has happened in Great Britain. Securities issued some time ago at 2i per cent, by the British Government are being quoted to-day at 50 per cent, of thenface value. To obtain a parallel case in

Australia, we turn to securities issued at a rate of interest dictated not by this Government but by the Loan Council. I refer to the securities issued at 3i per cent. They are certainly not selling at 50 per cent, of their face value, but they are down to approximately £88. Those who invest in government securities are bound by the terms upon which they take them out. When they buy into government loans, they are guaranteed repayment on a certain date, and they are guaranteed a certain rate of interest, but they have no guarantee against depreciation. This means that people with limited means, such as retired persons, widows and others who invest in these lowinterest bearing loans are the ones who are really suffering. They are casualties in a situation in which Australia is trying to do too much with too little in too short a time. But we are compelled to do such things if we are to retain control of the continent.

What I am saying may be paradoxical, but the plain fact of the matter is that unless Australia takes risks, unless she faces up to certain dangers of inflation under a tremendous capital expansion such as we are experiencing now, then, as sure as the sun rises of a morning, we shall not be able to hold this country. Having regard to all the facts, it must be admitted that during the period it has been in control of the treasury bench, this Government has been able to modify the position to the best advantage of the greatest number in the country.

Mention has been made of the plight of the age pensioners. Speaking from memory, I think they are receiving 45s. 6d. more than they were being paid when we attained office. That figure takes in the recent increase. In addition to that, age pensioners now enjoy free hospitalization, free medical benefits and certain other privileges which were not accorded them previously.

In view of all those facts, it must be admitted that the Government is faced with a dilemma. If it pushes the position too far it will depreciate its own loans and even though the depreciation may not be as great as that in Great Britain where 2i per cent, securities are being quoted at 50 per cent, of their face value, the fact is that the inevitable results of a depreciation in the value of government securities are, first, a deterioration in living standards, and, secondly, a discouragement of thrift. When all is said and done, it is very largely the thrifty people who invest their money either directly in government loans or indirectly through the insurance companies which hold their money. If thrift is discouraged there must follow a disinclination to invest in government loans. The Government which I support faced up to the situation which arose in the period of transition from low interest to high interest. The fact that the interest on government loans is stabilized at about 5 per cent, has restored confidence in them. That is indicated by the willingness of people to invest in government loans. The management of government loans is not simply a matter of collecting large sums from people, under duress, as was almost the case during the war years. It is a matter of balancing the requirements of public finance against those of private finance in the development of industry. Over-emphasis on government loans may depress private enterprise, and stultify the development of normal activities in the community. If, on the other hand, a policy sends too much into private enterprise, government services will be inadequate to supply private enterprise itself, let alone to provide the social amenities which are required. This Government, in my opinion, has, with great judgment and great courage, faced up to a tremendous amount of temporary unpopularity, but has finally earned the respect of many of its former critics because of the wisdom displayed in its longrange policy.

I commend the Government for its sympathetic attitude towards ex-servicemen and their dependants, as is illustrated by this budget. I have received letters of commendation for the assistance that is being given to the totally and permanently incapacitated pensioners and others; but 1 would seriously make a suggestion to the Government. I have had case after case brought under my notice involving veterans of World War I., in particular, although there may be some from World War II. Many men who served in the 1914-18 war crack up somewhere between the ages of 55 and 60. Some die at 60 years of age, as did my very distinguished friend Mr. H. L. Anthony, whereas men who did not go through the tremendous stresses of war, the battering and the nerve-strain at the vital period of life when men store their nerve forces, continue on to a ripe old age. [ have had brought to my notice case after case involving men who have died or become practically incapacitated at between 55 and 60 years of age. They cannot get any special recognition, notwithstanding the liberal policy so far adopted by the Government. I am convinced that any man who served in a theatre of war and who cracks up between the ages I have mentioned should be granted, without the slightest hesitation, a pension according to his state of incapacity. If he dies his widow and his dependants should be granted pensions. 1 could cite five cases at present. I can illustrate one dramatic case of a man who served in World War I., and he is typical of tens of thousands who, because they felt well when they came back, did not apply for a pension. Their papers were lost and consequently when they sought assistance they were unable to obtain it. This man got as far as Darwin in the last war, served there for a while, and then broke down with leg trouble. His application for a pension was refused. He appealed and when he was asked on what grounds he appealed he said, “ I was wounded in the 1914-18 war”. He was asked, “Where were you wounded? There is no record of it.” He said, “ I carry the record. I was wounded in the leg.” He was X-rayed and it was found that he had carried a piece of shrapnel in his leg as a memento for all those years. If he had not had that proof he would not have got anything.

I say that these men deserve well of this country. The amount which would be involved is not very great relative to the wealth of the country and there should not be the slightest hesitation in granting them pensions.

I also have a case of a man who served in World War II. A professor of tropical medicine in Sydney said that this man’s disability was due to the effects of his service in Darwin - he did not serve outside Australia. However, his application for pension was rejected by the tribunal. This man. a magnificent type of chap, was completely confined to his bed. He died a few weeks ago and I assume that his widow does not net the recognition which would be so helpful to her.

I pass now to another matter which to mv mind is of first-class importance. First, however, I want to thank the Treasurer (Sir Arthur Fadden) and the Government for the recognition given at last to the claims of libraries and art galleries, the National Trust of Australia, and other bodies, first in the matter of income tax, and secondly, with regard to bequests from estates. Before the advent of uniform taxation, most States of the Commonwealth and perhaps also the Commonwealth, granted concessions to these bodies. The restoration of those concessions is one of the soundest and wisest moves on the part of this Government, because it will encourage private benefaction. Where the Crown otherwise would have to find all, it will now have to find only the portion represented by the remission of tax. The donor will have a higher public spirit and as long as he lives he will find some real interest in the work to which he has given his money. I am very glad indeed to see these concessions included in the budget and I thank the Government for at last taking this important step.

I wish to refer now to education. The Australia-wide demand for better education facilities is one that I think every person in the community should take more closely to heart and every government should consider its implications. The demand is emphasized by the shortage of scientists, the shortage of teachers, particularly of science teachers, and of students of science. The gravity of the position is such that I do not think it can be overestimated. It cannot be dismissed as a propaganda stunt to get additional benefits for teachers or for educationists. There is a Teal crisis in education. I will illustrate just how grave this crisis can become and is becoming to the nation. This is an extreme case. What is the greatest disability suffered by the under-developed nations of the East, which are trying to establish modern economies? They are faced with the disability that while they can get specialists from the West to help them, and while they have a large number of specialists in certain fields, they do not have the foundation of an efficient education system which would enable them to build themselves up swiftly. They developed an education system which was suited to their original economy. But it is necessary to start from the beginning and prepare children in the primary school to learn the new skills in accordance with new developments in secondary schools so that they can be trained in the required numbers as technologists and specialists whom we must have if this nation is to survive.

In 1949 there were 810,000. children in government schools in Australia compared with 1,275,000 at present, an increase of 60 per cent. The expenditure by the States on schools, not universities or technical colleges, in 1950 amounted to £33 12s. lid. per head compared with £50 8s. 9d. per head at present. Including buildings, the figures for the periods that I have mentioned are £35,000,000 and £70,000,000 respectively, an increase of 100 per cent. In addition, there are nearly 340,000 children in non-government schools and, in view of the expenditure of £50 8s. 9d. per head in respect of State schools, one can realize the burden that one section of the community is carrying in contributing towards the general cost of education through taxation while sending their children to non-government schools. I merely mention that in passing. In 1950, 161,564 students were being provided with technical education compared with 178,527 who are receiving technical education now. The expenditure on technical education n 1950 amounted to £5,100,000 compared with £9,200,000 in 1954.

Let us examine the output of our universities in 1955. In that year 3,432 students graduated from all universities in Australia. They represented roughly 2.7 per 1,000 of the population. I believe that that proportion is not good enough for a country like Australia. People were shocked when it was shown that Russia was turning out more scientists than the United States of America and the United Kingdom combined. Because of the tremendous demand for scientists and scientific workers, industry has been taking the best of the school teachers and college lecturers because it has been paying very much higher salaries than the educational institutions pay. By the same token, industry is practically cutting its own throat because it is drying up the source of teachers for the young people who come along.

I do not intend to mention these things without suggesting some alternative. Last year, in the United States of America, a committee, known as the White House Conference on Education, was appointed. The recommendations it made are far too lengthy to quote at this juncture, but they epitomize the kind of thing that I have been speaking about to-night and have spoken about ever since I came into this House. I am not merely plugging for benefits for teachers or schools. I believe in such benefits with all my heart. What I have plugged for all this year is that this nation should wake up and realize that it must lay a sound educational foundation. We must get the nation to look at this problem as a whole and not solely in regard to university education. I congratulate the Government on its enterprise in appointing a committee on that subject. But it is necessary to look at the problem as a whole, to find out why we are not getting sufficient science teachers and science students, and to discover the weaknesses in the position. I believe it will be found that the present position is partly due to the fact that we are not making sufficient provision for the education of the children of those who do not receive much more than the basic wage. No country can survive which fails to “train children with first class, second class, or even third class, brains for the positions which they could occupy. No country has first class or second class brains to spare. No country has sufficient to supply the requirements of an age that is changing as fast as ours. We are falling down on the job in this country.

I urge the Government, which is spending so much on defence, to realize that the first line of defence is provided by trained people who must be available in sufficient numbers to man industry, universities and colleges, and to maintain the constant flow from one point to the final point which every practical man who runs a business knows is necessary. If that is not done, the sources of supply will be choked and industry will break down. This country, expanding as it is, cannot afford to tolerate such a state of affairs. I have urged these measures on the Government very often, but I now put them forward again because so much more evidence has come forward in support of my case. Let me cite one instance. The first science lecturer at the University of New England was taken from that institution by a great private concern. To-day, he is one of the tod men in the hierarchy of Imperial Chemical Industries of Australia and New Zealand Limited. That tendency is being accelerated by the attempt to train scientists in every direction. No doubt it is profitable for industry to take these men from the universities but, in doing so, it robs the system of sufficient people to train students. Consequently, I urge the Government to appoint an expert committee to look into the whole question of education and to face up to the implications of the present position before it is too late.

Progress reported.

page 546


Hungarian Immigrants - Postal Department - Japanese War Criminals - Tariff Board

Motion (by Dr. Donald Cameron) proposed -

That the House do now adjourn.


– I rise once again in order to ask the Government to do something about the serious situation which has developed in connexion with Hungarian refugees in this country. I mentioned this matter when I spoke on the budget debate yesterday. I asked then that the Government should pay heed to the complaint that was first raised by the honorable member for East Sydney (Mr. Ward), which was completely ignored by the Government on that occasion and has been completely ignored by it ever since. Once again, I ask the Minister for Immigration (Mr. Townley), who is now in the chamber, to look at the situation which I have already outlined.

I said, when I first raised this matter, as the honorable member for East Sydney also did, that hundreds of these people are tramping the streets of Australia. They have been brought out here under false pretences by the Government and are unable to obtain the employment which they were assured they would be able to obtain. They have left their hostels in disgust at the treatment they were receiving there. The food and treatment generally was such that they were prepared to remain in Government hostels no longer. They are now tramping the streets in a hopeless search for work as are many other people in Australia. They are sleeping in carriages at railway sidings, and in public parks, for they have nowhere else to lay their heads - yet government employment agencies refuse them the unemployment benefit on the ground that they have no permanent place of abode! They are a sad, disillusioned and broken-hearted people. They were brought here by a government which made all kinds of promises, but which now shows itself to have no intention whatever of honouring them. If we compare the Government’s promises with its performances, we are entitled to assume that it brought these people here for propaganda purposes only. The Government thought that it would get some political advantage from bringing here refugees who had the whole-hearted sympathy of people everywhere. The hearts of all bled for these refugees, who had been so badly treated in their own country.

The Government knew that everyone in Australia would approve its offering them a home, security and employment - and all the other things that they had been denied in the country which they had left. The Minister, having seen the magnificent public response to the first announcement about the first batch of Hungarians being brought here, used what should be a non-political conference - the Australian Citizenship Convention in Canberra - to announce a proposal to bring out a second batch.

We had been told that the conference was to be non-political, but the Minister used it to make two important decisions on policy - both popular with the Australian people. One was the decision to increase the intake of British immigrants, and the other was the decision to increase the number of Hungarian refugees who were to be brought to this country. Both the Government and the Opposition were represented at this so called non-political convention. The Minister did not approach the honorable member for Werriwa (Mr. Whitlam), who officially represented the Leader of the Opposition (Dr. Evatt) at the convention, and say to him, as he should have done, “ This is a non-political convention and therefore the Government does not desire to make any political capital out of any announcement that might be made here on its behalf “. He did not say, as he should have done, that the Government intended to increase the intake of British immigrants, and also of Hungarian refugees. Nor did he ask the honorable member whether he could assume that the Opposition would agree to such a proposal - a question which the honorable member was authorized by the Labour party to answer in the affirmative. He did not go on to the platform and say, as he might have done. 1 am pleased to announce on behalf of the Government and of the Opposition two points of policy with respect to immigration “. Not at all! He chose to make no mention of the matter to the Opposition.

Therefore it is perfectly clear that the decision to assist the Hungarian refugees in the first place was a purely political decision, made in the hope of obtaining political advantage, but with no intention of doing anything for them here - where they have run right into the very thing which they sought to escape in their own country. So bad has their situation become in this country that some of these poor, unfortunate creatures are now asking, through Labour members, that representations be made to the Government to repatriate them to Hungary. The honorable member for East Sydney has repeatedly challenged the Government to say whether or not it is prepared to send these Hungarians back home so that they may escape the conditions which I have just described. The honorable member is prepared to give to the Minister the names and addresses of Hungarians who have made it perfectly clear that they do not wish to remain any longer in this country - that they would much prefer being back in Communist-controlled Hungary to living in their present state. So much do they prefer Communistcontrolled Hungary to Australia under this Government, that they are pleading with the Government to send them back to Hungary. If the Government thinks that this is an idle challenge, let the Government accept it and ask the honorable member for East Sydney to produce the names of men who are prepared to board the first aircraft back to Hungary. That is the test of the honorable member’s sincerity. If he cannot produce the names he will be exposed as being guilty of sheer make-believe. The Government is not game to accept the challenge, because it knows that the honorable member for East Sydney is always able to produce the goods.

This is a most disastrous situation. Ours is a rich, young country. We earned the respect and admiration of the world when we first announced our decision to assist these unfortunate people; but we have treated them so shamefully, after having obtained the desired political kudos as a result of our action, that we are now branding ourselves in the eyes of the world as a country that is even worse than Communist Hungary, from which these people came. Do these people wish to return to Hungary? Surely that is the acid test? Surely, no stronger test could be made!

I want, now, to refer to one or two other matters. The first provides an example of very bad administration on the part of the Postmaster - General’s Department. The present Postmaster-General is, perhaps, not to blame, because he has not yet had time to rectify the bad administration of his predecessor. However, somebody must take responsibility for the fact that, in 1951, two properties in my electorate - one at Lockleys, and one at West Torrens, opposite the council chambers - were acquired for the erection, long overdue, of new post offices. Five years ago, the occupant of one of the premises, who was conducting a small grocery business, was forcibly ejected by the Government on the pretext that a new post office had to be constructed immediately. That man lost his business. He made an application through you, Mr. Speaker, as well as through me, for compensation, but the Government claimed that, as he was only a tenant, no compensation could be paid. Apparently, it considered that the goodwill was worth nothing. Though five years have elapsed, absolutely nothing has been done to commence work on that post office.

At Lockleys, in 1951, much the same kind of thing happened. Indeed, my electorate seems to have been singled out for this kind of treatment. Almost two years earlier, in 1950-


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

Minister for Immigration · Denison · LP

– I am bound to say that the honorable member for Hindmarsh (Mr. Clyde Cameron) has made one of the most vicious and dishonest statements that I have ever heard in this chamber.


– The Minister is out of order in using the term “ dishonest “. He must withdraw it.


– I withdraw the words without hesitation, but I am sure that you, Mr. Speaker, can understand why I used them.


– -Order


– Why do not you withdraw and apologize?


– Order! The Minister will withdraw the words unreservedly.


– I do so without hesitation. All I say is that I hope you understand why I used rather strong language.


– Order! I ask the Minister to withdraw the remark, and not to pursue that line of approach any further.

Mr Curtin:

– Make him withdraw!


– The honorable member for Kingsford-Smith will remain silent.


– A statement like that made by the honorable member for Hindmarsh is very difficult to follow. Am I right in saying that his words are completely beyond contempt? Is that in order?


– The Minister is going from bad to worse.


– The Minister will resume his seat. Is the honorable member for Hindmarsh raising a point of order?


– No.


– Then the honorable member must resume his seat. The Minister may continue.


– I am asking for the statement to be withdrawn, lt is objectionable to me for the Minister to say that something I have said is beyond contempt.


– There is only one thing to do; that is, to state the facts of this case. When the uprising occurred in Hungary, thousands of people streamed across the border into Austria. The first country to recognize that here was a great human problem, the first country to come to the rescue of these unfortunate people by offering them sanctuary in a new land and raising £150,000 for their immediate relief, was Australia. That action on the part of the Australian Government not only received commendation throughout the free world, but also set a pattern which was followed by almost every other democratic country.

Originally Australia said it would take 3.000 of these people, but their plight was so desperate, there were so many of them and the pressure on the little country of Austria was so tremendous that we increased the number, first to 5,000 and then to 10,000. Altogether 10,255 of these people have come to Australia since December of last year. Of that number, 4,168 were women, and children. Of these 10,255 people, about 9,000 disappeared into our community without causing a ripple. They were placed in employment, provided with accommodation and absorbed into the community.

In the three principal immigrant centres, mainly in Bonegilla, 692 Hungarian workers are left. The only other Hungarians left in the immigration centres at present are 297 women and children. Some of the Hungarians, on arrival, immediately went to friends and relatives. The officers of the department controlled by my colleague, the Minister for Labour and National Service (Mr. Harold Holt) have placed inemployment no fewer than 3,937 of tha others. The vast majority of the immigrants, having gone through the transit centres, went out to private accommodation which had been arranged, not only by friends, but also by church organizations and other interested bodies.

Australia was the first country, but not the only country, to offer a home to these Hungarian refugees. Experience has shown, that of all the major immigrant receiving countries which gave sanctuary to Hungarians, no country has a record that equals that of Australia. In all of our immigrant centres we have to-day only 692 workers from Hungary awaiting employment. In Canada there are more than 6,000 - tentimes the number in Australia - so our performance has been fairly good. We must remember, too, that although many of these 10,000 people came here in the first rush to get away, 5,700 arrived in April, May and June, and another 687 in July and August - only a month or so ago. So well over 60 per cent, of these people arrived in Australia only during the last four months. I understand that only last week another immigrant ship arrived with - T speak from memory - another 157 of these people.

One of the unfortunate things about these Hungarians is that they are refugees, not people who have come here under a planned immigration programme, for whom jobs and accommodation were arranged by the department before they were recruited overseas. This was a refugee problem, and it was not possible in the emergency of -those days to pick people according to their skills. One of the great problems is language. Whereas most European languages bear some sort of relationship to each other, the Magyar language of the Hungarians is particularly difficult. Very few of these Hungarians have learnt English and very few people here can speak Hungarian. Even though a person here may speak Hungarian quite fluently and perhaps knows English as well, he may not be a trained teacher. This poses a problem. Quite obviously, an employer, before engaging an immigrant, will want to be satisfied that the immigrant has at least i basic knowledge of the English language. The Department of Immigration is spending £400,000 a year in the immigrant centres on the teaching of English. At Bonegilla, where most of the Hungarians left on our books, as it were, are located, we have concentrated all the resources we have in the educational field to teach these people English.

That is not the only problem. Many of the younger people who came from Hungary are university students. It is not much of a consolation for them to be offered jobs on the Snowy Mountains scheme or something like that when they want to continue their studies. However, before they can carry on with university studies it is absolutely essential for them to master the English tongue. It would be useless to send a student to an Australian university if he could not understand the language that a lecturer was using.

The main point I wish to make is that it was not the honorable member for East Sydney (Mr. Ward) who first raised this matter, nor was it the honorable member for Hindmarsh (Mr. Clyde Cameron). The first of these distorted attacks on the Hungarian immigration programme was made some six weeks ago in the Communist * Tribune “. I do not know whether the honorable member for East Sydney knows that, but he need not take my word for it. Copies of the “ Tribune “ are freely available to him or to any other honorable member who wants to check what I have said. There are two reasons why the Communists are attacking the Hungarians in this malevolent and distorted way. First, they know that anything of this nature which is published in Australia is taken back to Europe and used in the iron curtain countries to damage the Western democracies. The second, and most important, reason is that for some time the free nations of the world have been trying to have the United Nations’ report on the Hungarian atrocities discussed in the United Nations Assembly. We had little hope of that, but after enormous trouble we were able to arrange for the report to be discussed by the Assembly. As honorable members know, in the next two or three weeks, in spite of everything that the Communists have done, the United Nations’ report on the Hungarian massacre and atrocities will be discussed by the Assembly. The Communists wish to discredit the report before it reaches there.


-Order! The Minister’s time has expired.

East Sydney

.- The Minister for Immigration (Mr. Townley) commenced his remarks by saying that he wanted to deal with the facts, but then he religiously avoided them. The facts are that this matter was raised in this House a few days ago, when no reply was forthcoming from the Minister. I was unaware of, and not interested in, what appeared in the “ Tribune “ newspaper. The real test is whether what is published and what I say is true or otherwise. Some of the stupid members opposite would believe that if the “ Tribune “ said it is now eleven minutes to eleven, I would deny it and say that it is half-past nine. Even the Communists, 1 imagine, on occasions are capable of telling the truth. Here is my challenge to the Minister. He has completely avoided it so far. I ask: Are there Hungarians in this country who are in desperate need, who were brought here by this Government and who are walking the streets of the cities, sleeping on railway stations, oh river banks, and anywhere they can lay their heads? And are there Hungarians who were brought to this country who now want this Government to send them back to their own country?

Mr Mackinnon:

– No.


– I repeat my offer to the Minister. I will not give addresses, as the honorable member for Hindmarsh (Mr. Clyde Cameron) said, because addresses usually imply places where somebody lives.

J will not give their residences because they have not got any residences. But I will furnish to the Minister addresses where they can be contacted. They have used addresses merely in order to get the Commonwealth social services payments; they cannot get them otherwise, because the Department of Labour and National Service has been refusing them the social service benefits until they furnished a fixed place of residence.

I say that these people want to go back. They are the best judges as to whether they have been misled, as to whether this Government has merely used them for political propaganda - and that is the opinion I hold in respect of it.

Let us examine what the Minister said in regard to the matter. I am able to tell you what these men, through an interpreter, told me. There were three of them present - one was unable to come because he was ill. They told me that there are many others in a similar position. According to these men, they left their own country and went into Austria where they were given a most glowing account of conditions they would find upon arrival in Australia. They would be given work; they would be provided with homes; conditions generally would be good; and they could expect prosperity after they entered Australia. The Minister said that to date we have agreed to take 10,000 Hungarian refugees. I understood another 5,000 were to come. I think that the ones who have not arrived in this country ought to be made aware of the conditions in Australia - that there is unemployment, that some of their compatriots are walking the streets, without employment, and are requesting the Government to return them to their own country.

Let us consider the conditions in the hostels that were provided for the Hungarians, and why they have left them. The Minister did not make any reference to the conditions at Bonegilla. Does he deny that eight of these men are expected to live in one room, with one dish to wash in, and does he deny that there is one water tap for every three accommodation blocks? Does he deny that many of the Hungarians became ill because of the unsuitability of the food that was provided for them? Does he also deny that there was a hunger strike amongst the Hungarians at the Bonegilla camp? Is it not a fact that some of themen who were regarded as the ringleaderswere placed in detention? Are not these the facts? The Minister has not told me anything with respect to them. Now he says, only 692 men - and 297 women and children - are in the hostels awaiting employment. But how many have left the hostels and are walking the streets looking: for work?

The press reported a few days ago that a Yugoslav deliberately broke the law so> that he would be put into prison, where he would be fed. That article appeared, not in the “ Tribune “, but in one of the antiLabour newspapers. It was an article in respect of the treatment that these people are getting. Therefore, the Government would be delighted if it was able to say that there were no longer any Hungarians at all in the reception centre. Does the Minister deny that these people want to go back to their own country? I guarantee that if the Minister agrees to provide the necessary travel vouchers, I shall bring to Canberra next week some Hungarians whom he can question. He can have his own interpreter and he can question them about the conditions that they were promised when they first decided to come to Australia.

Let me say one other thing in respect of this particular matter before I pass on to another subject. It is this: It was not the Labour party that brought these people to this country. If there were employment and housing available, and if they could be absorbed into the community, the Labour party would welcome them, but we refuse to allow this anti-Labour Government to engage in political stunting at the expense of unfortunate people, whether they come from Hungary or from any other part of the world - and that is all that the Government has been doing in respect of this particular issue. Honorable members opposite have been playing politics, as they always do. They hold their citizenship conventions, which are an expensive luxury, because from what I can gather not a great deal emerges from their deliberations or decisions. Even these gatherings, as the honorable member for Hindmarsh has correctly said, are used for political purposes. The Government has been doing this right through the piece ever since its policy was determined.

I want now, in the remaining time at my disposal, to refer to what I regard as a complete act of dishonesty on the part of the responsible Minister - who is the same Minister as the one to whom I have been referring. He wrote to me in a different capacity, regarding the release of the Japanese prisoners of war - on behalf of the then Acting Prime Minister. Sir Arthur Fadden. I had directed a number of questions to the Government in relation to its sudden generosity towards the war criminals who had perpetrated such atrocities against our own forces, and those of our allies. I received an amazing letter from the Minister for Immigration. It was not even truthful, because it contained a contradiction. The Minister said, in the letter -

The war criminal trials were completed in April, 1951.

I want honorable members to remember the date -

Those convicted were held at Rabaul and Manus Island until 1953, when it was decided to transfer them to Japan and place them in the Sugamo prison.

He went on to say that they were eligible for release after they had served the major portion of their sentences. In 1955, the Minister for Primary Industry (Mr. McMahon), on behalf of the Government, gave a solemn undertaking to Mr. Yeo, the president of the New South Wales branch of the Returned Sailors, Soldiers and Airmen’s Imperial League of Australia. The Minister had asked whether the organization would object to the proposal of the Government to transfer these war criminals to Japan, and he gave the assurance that these men, if they were transferred, would be obliged to complete their full sentences.


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


.- When the honorable member for East Sydney (Mr. Ward) shuffles on his well-defined way to join the devil, the only person who will complain will be the devil himself. If I were sitting on the other side of the House, I would be a little ashamed to serve in this Parliament to-night and to protest on behalf of the Hungarian people about their treatment in this country. Go back twelve months, to the time when the actual Hungarian revolt occurred. Was there any complaint from the honorable member for

East Sydney? Was there any complaint from the honorable member for Hindmarsh (Mr. Clyde Cameron)? Was there any complaint from the right honorable, member for Barton (Dr. Evatt)? No! There was a shameful and shocking silence. But, this evening, both the honorable member for Hindmarsh and his aide here - although I understand the honorable member for Hindmarsh, last night, styled the honorable member for East Sydney his leader - rose in this House and, with simulated sympathy - synthetic sympathy - protested on behalf of the Hungarian people. I ask you, Mr. Speaker, to observe the honorable member for East Sydney. I am sure that if you do you will agree with me that if the keepers of the Taronga Park Zoo saw him they would throw a net over him.


– Order! I must draw the attention of the honorable member for East Sydney to his conduct in the chamber. It must cease.


– The honorable member spoke this evening about facts and also about truth. At the risk of boring the House, may I say that his affection for the truth, and his affection for facts is approximated only by his affection for me. If there is any doubt in the mind of the honorable member as to how real that is, I venture to suggest that he would cut my throat for practice.

We have seen here to-night an interesting example not only in political performance, but also in psychology. Here are the honorable members for East Sydney and Hindmarsh, rising in their places and protesting that this country has let down the Hungarians. As the honorable and gallant Minister for Immigration (Mr. Townley) has pointed out, Australia was the first country in the world to offer sanctuary to the Hungarians. What are the facts of the matter? Let us get back to the facts. They may disturb and irritate the honorable member for East Sydney, but I cannot be unnecessarily worried about that.

When the Hungarian revolt commenced, the first people to get out of Hungary were the Communists, who fled from the Hungarian workers. I venture to say that without any shadow of doubt a number of Communist agents, in the guise of refugees, came to this country.

Opposition Members. - Ah!


– An honorable member opposite, sitting at the back of the chamber, smiles when I say that. Let me direct his mind back to twelve months ago. What did the Sydney “Tribune” - the Communist “ Tribune “ - have to say about the Hungarian revolt on that occasion? It said that it was a fascist revolt. I am a little saddened to think that there is a person sitting in this Parliament at this moment who, a short time ago made the charge that it was approximately true to say that the revolt in Hungary was a fascist revolt. It is interesting for the House to recall that fact. What did the “ Tribune “ say about it? It said that it was a fascist revolt and an expression of the reactionaries. That was the “ Tribune “ line. And what has been the line of the honorable members for East Sydney and Hindmarsh to-night? I have here the “ Tribune “ of 4th September and I ask the House to adjudicate on the matter. Let us take the case as presented by the honorable members for East Sydney and Hindmarsh and compare it with this article in this “ Tribune “. It reads -

We have nowhere to live, no money-

Note the pathos, the intense tragedy, similar to that invoked by the two tragedians sitting at the table on the other side of the chamber! The article continues - can’t get work, and want to go home “. This was said to Tribune by a group of young Hungarians who were enticed to Australia by false promises six months ago. “ We never even got enough to eat at the holding camps at Skyville and Bonegilla “, they said. “ We were always hungry and have all lost weight. At Bonegilla there were hunger strikes.”

What is the difference between the comments by the “ Tribune “ and those by the honorable members for East Sydney and Hindmarsh?

The fact remains - and it cannot be denied by any test - that every effort that has been made to assist the Hungarians in a practical way has been derided by these two honorable members. It hurts them like hades that any person should rise in his place in this Parliament, or outside it, and take up the cry that communism is a vicious and wicked instrument. The politics of the honorable member for East Sydney are like his tie - loud and red. I remind the honorable gentleman that a few months ago in this Parliament he criticized my friend and colleague the honorable member for Mackellar (Mr. Wentworth), the honorable and gallant member for Bowman (Mr. McColm) and myself because we stated our attitude of mind towards the Hungarian revolt.

The facts are simply these: 10,255 Hungarians have been received into this country. At this time only 692 of them remain out of work. That, Mr. Speaker, is a remarkable effort and is also a remarkable tribute to the Government and the Minister for Immigration. There have been immense problems in bringing these people to this country - problems of language and culture, emotional problems, and problems of assimilation in getting these people to fit into the Australian way of life after an intense and dreadful experience in Hungary. If I were the honorable member for East Sydney or the honorable member for Hindmarsh I would sit in silence and in shame to think that their leader, the right honorable member for Barton, when the Hungarian holocaust was at its height, did not speak one word of complaint. If these two honorable gentlemen were really sincere in their concern for the Hungarian people they would sit in silence. Their efforts this evening have exposed them for what they are - a pair of political shams, intent on following the pro-Communist line and discarding to the four winds all the propriety associated with political conduct.


.- I want to deal in facts for ten minutes, rather than to give a display of uncontrolled emotion such as we have just seen. I wish to deal with the Tariff Board because Australia’s balance of payments problems and the possible impact of the Japanese Trade Agreement make it more than ordinarily important that the Tariff Board should function well and effectively. There is evidence that the board is not functioning well and efficiently. In fact, there is evidence that the meetings of the board have not been properly convened; that the minutes have not been properly kept; that the dissents of members have not been included in minutes or reports and have, iri fact, been suppressed, and that reports have not been properly signed. It is doubtful whether some of those reports could even be called reports of the board within the meaning of the Tariff Board Act. All of this amounts to a very serious state of affairs. It is a situation which has been brought to the notice of the public over quite a considerable period of time.

The Melbourne “ Age “, of 6th September, said -

The Tariff Board has been allowed to rust and decay . . . First, its authority has been impaired by parliamentary interference over recent years.

I suggest that what the “ Age “ meant was interference by the Government, not by the Parliament. It went on -

Second, the machinery of tariff fixing . . . has been allowed to grow clumsy and slow.

The board itself, early this month, warned manufacturers that the Government might over-rule its findings in cases arising from the Japanese Trade Agreement. In a recent television interview, the Minister for Trade (Mr. McEwen) acknowledged the need for an overhaul of Tariff Board machinery. These criticisms and proposals have been submitted over a period of two or three years.

There are other very disquieting features of the operations of the board. In the middle of June, 1956, I placed a question on the notice-paper asking whether the Government would table a minority report submitted by a member of the board which had been excluded from the 1955 report of the board. On the 17th September I asked a question without notice in the following terms -

Is the Minister for Trade aware that I have had a question on the notice-paper for three and a half months, which makes it two and a half months senior to any other question on the notice-paper? The question asked, among other things, whether the Minister will table a minority report submitted by members of the Tariff Board which was not included in the report of the board presented to Parliament on 19th October, 1955,

The Minister replied -

I regret the reply has not been provided. 1 shall sec it is provided at an early date.

Soon after that, a reply was provided to the question on notice. That reply was to the effect that when the board is preparing its annual report under section 18 of the act, the inclusion of dissenting views would, I take it, be considered by the board in the light of its views on the question whether the minority opinions were of sufficient revelance and importance. But in this case the minority opinions were described by the chairman of the board as “ open to question “, “ a cause of great concern “, and “ quite misleading “. Yet, this minority opinion and the report so described by the chairman were excluded from the report, and, in fact, it was tabled in the library of this Parliament on 4th October.

The Minister should inform the House - and it is unfortunate that he is not here to-night - whether he agrees that a majority of the Tariff Board should prevail over minority opinions inside the board, so as to exclude those opinions from the report or from any kind of public ventilation except as a result of a long process of question and answer dragging out those opinions in this Parliament. I ask the Minister also whether it is his view that views described as “ open to question “, “ a cause of great concern “ and “ quite misleading “ by at least one member of the board could, at the same time, be regarded as of insufficient relevance and importance to be excluded from the report and yet, fourteen months later, be tabled in the library of Parliament by decision of the Minister himself. in addition, the Crown Solicitor and other departmental officials have refrained from stating that steps have been taken to avoid the issue arising in this matter. Prevarication has been practised for a period of nearly eighteen months. 1 am given to understand that a member of the board was so confident of his ground that he was prepared to approach the High Court in relation to procedures of the board. Further, the 1957 report of the Tariff Board, which was submitted last week, was signed alone by the chairman. 1 should like the Minister to inform the House why this extraordinary step, for the first time in the history of the Tariff Board, has been taken. Why was the annual report signed only by the chairman? Is it a report of the board in fact? Can a report signed only by the chairman be said to be a report of the board? Are there any minutes of the meeting of the board to show why it was signed by the chairman alone, or to show whether it was a report of the board or a report only of the chairman? The House can be quite unaware of the situation. Further, at least two reports of the board have been submitted during this year which have not been signed by all the members of the board who exercise the powers of the board in relation to the inquiries concerned. The signature of one of the persons who conducted the inquiry was not, for some reason or other, included in the report that was eventually tabled in this House.

I have said that meetings of the board are not properly convened, and have often been called at notice as short as five minutes. In a book, the title of which is “ Law and Procedure at Meetings “, the honorable member for Balaclava says at pages 18, 19, and 20-

Meetings must be properly convened . . . Notice must be reasonable. . . .

Anyone is entitled to have dissent noted in the minutes. . . .

Any member is entitled to a copy of minutes upon making a request in writing.

All these things have been contravened during the course of the last twelve months in the operations of the Tariff Board. These fundamental and elementary rules have not been complied with in the case of the board. The independence of the board is at stake in this matter, not only vis-à-vis the Government, with which the Melbourne “ Age “ and others have been concerned, but in relation to the chairman of the board himself, who has effectively set up a method of control over the board which is excluding any kind of dissent with which the chairman might disagree, and also in relation to the Department of Trade, because the Tariff Board is fast losing its independence to that department. I remind the House that the honorable member for Warringah (Mr. Bland) in 1953, when the second Tariff Board was created by an act of this Parliament, said that the board was noted for its integrity and independence and that it was “ imperative that the independence of the board be maintained “. It certainly is imperative that the independence of the board be maintained.

The events I am describing, which have taken place over the past eighteen months or two years, as I say are fast threatening the independence of the board. I ask members on the other side of the House to inquire into these matters and to look at the facts, because in a lecture at the University of Melbourne delivered on 26th October, 1956, which has been published, one member of the board said -

Let us look closely at this matter, not to be critical or looking for points to score, but looking for enlightenment … I may have been off the target in this one . . . But what has me puzzled is that if I was off the target, why was there such obvious manoeuvring to hide the facts? Surely, the thing to do was to put me into print and then to have answered it in the House.

For the benefit of honorable members opposite who have just awakened, I am quoting from a lecture delivered by a member of the Tariff Board.

To sum up the criticisms I am making of the operations of the Tariff Board - and they are serious criticisms-


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

Minister for Primary Industry · Lowe · LP

– The honorable member for East Sydney (Mr. Ward) has told the House that I gave an assurance to the New South Wales president of the R.S.S.A.I.L.A. that if the Japanese war criminals were returned to Japan their sentences would not be commuted. It is lucky for the House that that statement has come from the honorable member for East Sydney and would therefore be dubious. What are the facts? They are these: On at least two occasions I had visited Manus Island, and during my visits there I had inspected the war criminals at the Manus compound. I came to the conclusion that the conditions under which they were living were totally unsatisfactory and should not be continued. The climate up there is rigorous. It is a climate in which ordinary human beings cannot live for very long periods. Unacceptable numbers of the Japanese war criminals were becoming mentally afflicted and were being returned to Japan because of their condition. For these reasons I made up my mind to recommend to the Government on purely humanitarian grounds that these men, even though they were war criminals, should be permitted to return to Japan. Now, I can see nothing wrong with that. I believe it was a matter based upon justice. I believe it was a matter based upon common decency.

Mr Ward:

– What about their crimes against Australian servicemen?


– You have committed crimes against humanity and people are prepared to forget them. Consequently, I came to the conclusion that if a request was made, as it had been made, for the return of these men to Japan, it should be complied with. What did I do? As a matter of common sense, I met the executive, or part of the executive, of the New South Wales division of the R.S.S.A.I.L.A. I explained the position to them, and I give it to the president and his committee that they agreed wholeheartedly with my suggestions, and they thought the reasons I had put forward were sound and should be accepted. It is true that the president said to me, “ Can an assurance be given that these men will not be released, and that their sentences will not be commuted? “ To that 1 gave the positive answer, “ I can give no assurance “, and the president of the New South Wales branch of the R.S.L. agreed with me that that was the proper attitude to adopt. I want to make it perfectly clear that I was not willing to continue to persecute these people and to compel them to be separated from their families, because connexion with their families does mean a lot to these people. I was not prepared to compel them to live in a most-


– A lot of criminals in the Adelaide gaol are going mental, too.


– Oh, shut up!


– Order!


Mr. Speaker, these people on the other side of the House giggle their heads off. One minute they pretend that they care and the next minute they ridicule their own suggestions, showing what hypocrites they are. .1 am quite emphatic when I say that I think that the president of the New South Wales branch of the R.S.L. adopted a responsible attitude towards this problem and approached it in a common-sense and realistic fashion. He knows, and I know, that, when the question of an undertaking to continue the confinement of these prisoners in the Sugamo prison was raised, I told him that I could give no assurance whatever.

Question resolved in the affirmative.

House adjourned at 11.21 p.m.

page 555


The following answers to questions were circulated: -

Overseas Trade

Mr Ward:

d asked the Minister for Trade, upon notice -

  1. What was the amount paid in freight charges last year upon Australian exports and imports respectively?
  2. What was the amount received in the same period in respect of (a) wheat, (b) flour, (c) sugar, (d) dried fruits, (e) butter, (f) milk (powdered and condensed), (g) eggs and (h) cheese?
Mr McEwen:
Minister for Trade · MURRAY, VICTORIA · CP

– The answers to the honorable member’s questions are as follows: -

  1. The Commonwealth Statistician’s estimate for 1955-56 of freight payable overseas is £103,000,000. This figure is made up of the freight paid on imports plus a relatively small amount representing mainly the freight paid overseas on the interstate movement of petroleum products. No figures of total freight “ paid “ on Australian exports are available.
  2. Export earnings for 1955-56 of the commodities specified were: -

Pharmaceutical Benefits

Mr Whitlam:

m asked the Minister for Health, upon notice -

  1. Did he make a determination that erythromycin may be prescribed as a general pharmaceutical benefit under the National Health Act for cases of staphylococcal pneumonia without previous use of penicillin or other drugs?
  2. If so, when did he make the determination?
  3. Did the Pharmaceutical Benefits Advisory Committee recommend this addition to the list of benefits, as required by section 101 (4) of the act?
  4. If so, what was the date of the committee’s recommendation and when did he accept the recommendation?
  5. If the committee did not recommend this addition, under what section of the act or under what regulation did he make the addition?
  6. Has a copy of the determination been published in the “ Gazette “, as required by section 85 (3) of the act; if so, on what date?
  7. If not published in the “ Gazette “, what steps have been taken to inform (a) persons receiving medical treatment by medical practitioners, (b) medical practitioners and (c) approved pharmaceutical chemists that they may (i) receive, (ii) prescribe and (iii) supply this additional benefit?

– The answers to the honorable member’s questions are as follows: -

  1. This was the subject of an amendment of the regulations. Erythromycin was included in the regulations for the treatment of staphylococcal infections that are resistant to the tetracyclines, and to penicillin.
  2. The regulation was effective from 1st July, 1957.
  3. Yes.
  4. Committee’s recommendation 10th April, 1957, accepted on 11th April, 1957.
  5. See 3 above.
  6. The amended regulations were published in “ Gazette “ No. 33 of 7th June, 1957.
  7. See 6 above.


Mr Swartz:

z asked the Minister for Health, upon notice -

  1. Are full supplies of Salk vaccine now available to all States to enable the plan for vaccination of all school children against poliomyelitis to be continued?
  2. Is there any indication as to when this programme will be completed?
  3. When the supply position for Salk vaccine permits, will arrangements be made for the vaccination of adults?

– The answers to the honorable member’s questions are as follows: -

  1. Yes.
  2. During 1958.
  3. Yes.

Cite as: Australia, House of Representatives, Debates, 11 September 1957, viewed 22 October 2017, <>.