House of Representatives
17 March 1960

23rd Parliament · 2nd Session

Mr. SPEAKER (Hon. John McLeay) took the chair at 10.30 a.m., and read prayers.

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– I wish to ask the Minister for the Army a question. Did he announce to a joint meeting of the Liberal Party and the Australian Country Party yesterday that he had given six months’ notice of discharge from the Australian Army of ten high ranking officers including-

Mr Anderson:

– 1 rise to a point of order, Mr. Speaker. Is the honorable gentleman in order in asking a question based upon a newspaper report?


– If the Leader of the Opposition is quoting a newspaper report, he is out of order.

Mr Calwell:

– I did not say that my question was based on a newspaper report.


– Is it based on such a report?

Mr Calwell:

– No, it is not.


– Then the honorable member is in order.


– As a matter of fact, Sir, newspaper correspondents told me the story before the newspapers published it. I think that I had better start again. I ask the Minister for the Army, without notice: Did he announce to a joint meeting of the Liberal Party and the Australian Country Party, yesterday, that he had given six months’ notice of discharge from the Australian Army to ten high ranking officers, including two brigadiers, because he regards them as being inefficient? If so, what explanation has he to offer for this extraordinary action, and for his extraordinary attitude generally towards the Army and particularly to the Citizen Military Forces? Finally, has he the idea that he can win immortality by becoming the undertaker of the Australian Army?

Minister for the Army · BENNELONG, NEW SOUTH WALES · LP

– I ask the honorable member, in the circumstances, to put his question on the notice-paper. I will then give him a full reply.

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– I direct a question to the Prime Minister. Last Friday, the Prime Minister was good enough to receive a deputation at rather snort notice on the subject of hail damage in Tasmanian orchards. At that time, the Prime Minister asked for further detailed information which I think he will now have had. Can the Prime Minister say when an examination will be made of this matter?

Prime Minister · KOOYONG, VICTORIA · LP

– It is quite true that I received a deputation which was, in fact, introduced by the honorable member, who has a great interest in this problem of hail damage to the apple harvest in Tasmania. The supplementary information I asked for was, in fact, provided and it is now under examination between myself and one other department. I hope to have a reply quite quickly.

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– I direct a question to the Prime Minister. In view of the fact that the Prime Minister is occupying the dual positions of Prime Minister and Minister for External Affairs, will he consider while overseas why Australia has not had proper representation in Ireland since this Government took office? Honorable members are disposed to treat this subject with levity-


– Order! We must show a little tolerance on this historic day.


– I am asking this question on behalf of thousands of Australian taxpayers, many of whom have visited Ireland and have found that we have no proper representation there. They ask why is it that Australian representation in Ireland is at the lowest level of Australian representation anywhere. Should the Prime Minister succeed where Lord Casey has failed, he will have the thanks of Australia and Ireland - and I mean that.

Mr Daly:

– A good St. Patrick’s Day question!


– In dealing with the

Government of Ireland, one would hardly expect a Menzies to succeed where a Casey has failed. The form of our representation in Ireland is dictated by a prolonged inability to agree on certain matters which are partly matters of form but which also have something to do with matters of substance. For some time now we have not been able to secure agreement. At one stage I thought we would be able to do so, but so far we have not. In the meantime, our representation there is on the level referred to by the honorable member.

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– My question is addressed to the Prime Minister in his capacity as Minister for External Affairs. In May last year, I urged the then Minister for External Affairs to examine the question of whether Australian land clearance methods could be gainfully used in east Asian countries. Can the Prime Minister tell me whether there have been any developments in this matter?


– After the honorable member raised this matter, it was referred to the Commonwealth Scientific and Industrial Research Organization, my predecessor in External Affairs being the Minister in charge of that organization. A good deal of work had been done on this subject, not only on these particular methods, but on other methods of land clearance. Communications were made with our posts abroad in the relevant countries and the attention of foreign governments was directed to this matter. The response so far, I am bound to say, has been quite small, largely based on the view, which will appeal to the honorable member, that methods of land clearance which suit one type of country, climate and foliage, do not necessarily have any applicability in another. But we have done our best to keep this idea moving and will continue to do so.

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– I ask the Minister for Air whether it is a fact that housing conditions for Air Force personnel based at Williamtown in New South Wales are bad, and that many men must travel upwards of 50 miles a day to and from work. If this is a fact, will the Minister inform me of the action his department proposes to take in respect of housing the staff since the establishment of the new squadron and rocket base at Williamtown?

Minister for Air · EVANS, NEW SOUTH WALES · LP

– It is correct that some of the personnel of the Air Force base at Williamtown have housing difficulties. Great progress in meeting the housing needs of married members of the service has been made in the last three years, particularly as a result of the provisions of the Commonwealth and State Housing Agreement. I hope that any housing difficulties will be completely overcome at almost all the bases throughout Australia within about two years.

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– I address a question to the Minister for Primary Industry. When the retail price of sugar was last fixed in 1956, were the sugar farmers’ costs taken into consideration? Have these farmers’ costs increased since then?

Minister for Primary Industry · FISHER, QUEENSLAND · CP

– Obviously, when the sugar industry applied for increased prices to both the Queensland Government and the Commonwealth Government in 1956, it would have had to prove its case in respect of increased costs of administration and handling. Since then, no special statistics or particulars have been taken out by the Bureau of Agricultural Economics in relation to the sugar industry; but I assume that, as with other industries, the position in the sugar industry could be as the honorable member assumes it to be.

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– Is the Treasurer aware that as the result of the easing of rent control in Victoria, which will operate as from 1st April, consternation has been caused in the minds of thousands of age pensioners who will be quite unable to pay increased rent? Will the Treasurer give consideration to this problem with a view to assisting the pensioners concerned to meet their new obligations?


– The only knowledge I have of this matter is what I have gleaned from the press, and naturally I treat that with a degree of reserve. But as to Commonwealth action along the lines which the honorable gentleman proposes, the only action so far which the Government has felt it appropriate to take in relation to needy pensioners who are paying rent for themselves, has been by way of special or supplementary assistance on the pension. Whether any further action should be taken is clearly a matter of policy, and can be appropriately considered at budget time.

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– My question is addressed to the Treasurer and concerns the alleged profit of the telephone branch of the Post Office last year, amounting to nearly £6,900,000. Can the Treasurer say, first, whether this profit was struck after allowing only £766,000 interest on capital assets of £410,000,000, upon which any ordinary business would have to pay well over £20,000,000? Can he also give some indication of the extent to which the annual capital subventions by the Treasury are applied to Post Office maintenance and replacement costs which in other businesses are charged to revenue? Have these matters been gone into by the committee now inquiring into Post Office accounting? If so, can he say when the report will be available, so that we may judge the extent lo which the published profits are phoney?


– The question asked by the honorable member for Wentworth covers a good deal of ground on this rather complex question. He speaks in terms of alleged profits, and towards the end of his question introduced a rather unhappy word, “ phoney “. I am quite certain that neither my colleague, the Postmaster-General, nor I could accept all the implications of what he has put in his question; but it has been made evident to the House that on the basis on which the profits of the Post Office have been calculated they have not, in the view of the Government, represented a realistic presentation of the financial transactions of the Post Office.

It is true that since the war very substantial capital amounts have been applied to the expansion of the Post Office, running into some hundreds of millions of pounds. The extent to which the capital amounts so provided should carry interest, so that a fair charge can be made for the services rendered by the Post Office, is one of the matters currently being investigated by the committee to which the honorable gentleman has referred.

There are other aspects of the activities of the Post Office to which it was felt that it would, perhaps, be appropriate to apply the methods of accountancy which obtain in private commercial undertakings, in order to see what would be a fair charge for the services rendered. I have seen it alleged that in this process the Government is, in effect, mulcting the taxpayer twice, in that the taxpayer, who has provided the capital funds for expansion, is now asked to pay the higher charges which will give something approaching a commercial return on the capital invested. That, I suggest, is a quite misleading and inaccurate statement of the position. If revenue were not raised by the Post Office obtaining returns of a commercial character, suitably computed, then the Commonwealth would find it necessary to raise additional revenue by way of taxation. Surely it is fairer that the revenue should be provided by those who use the services, in proportion to their use, rather than by the taxpayers irrespective of their use of such services.

I am personally quite satisfied that the imposition of the increased charges represents a move towards obtaining a more accurate commercial return on capital invested, but when we have the findings of the committee to which reference has been made we will be able to give more detailed information to the House, and satisfy the minds of honorable members generally on this subject.

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– Has the Minister for Labour and National Service received a request from the Queensland Government for assistance from the Commonwealth Government to relieve the unemployment situation in the north of Queensland, due to seasonal conditions and automation? If he has not, will he give serious and urgent consideration to any such request that he may receive in the future?

Minister for Labour and National Service · LOWE, NEW SOUTH WALES · LP

– Normally a communication from a State government to the Commonwealth Government is made by the Premier to the Prime Minister. I personally have not received any representations from the Queensland Government about the unemployment position in northern Queensland, but I give the honorable gentleman my assurance that if I receive any request, or if the Prime Minister receives one and passes it on to me, I will be only too happy to consider it. Some time ago the Minister for Labour in Queensland spoke to me about this problem. Certain suggestions were made to him as to ways in which seasonal unemployment in that State might be overcome. I know of the Minister’s great interest in this problem, and I hope that the suggestions made were helpful and will contribute to the solution of the problems of seasonal employment in Queensland.

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– I address a question to the Minister for Trade. Has the Minister had an opportunity to study the scheme for stabilization of raw materials and basic commodities expounded to the International Congress for Scientific Management in Melbourne recently by Mr. L. St. Clair Grondona? If not, will he examine it with a view to ascertaining whether its principles could provide the force we need behind his unremitting efforts to stabilize the economy of primary producing countries?

Minister for Trade · MURRAY, VICTORIA · CP

– I have had what I might describe as a not very full opportunity to study the proposals of Mr. L. St. Clair Grondona, who, I know, has devoted himself for many years to consideration of this and related subjects. While I do not feel that I can subscribe in full to his detailed approach to the subject, his general approach to it has my enthusiastic support.

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– I ask the Minister for the Army whether, in view of repeated statements of the Government’s intention to train officers of the Indonesian Army in Australia, he will state what stage has been reached in negotiations and whether Indonesian officers are at present being trained in Australia. Finally, I ask the Minister whether we can take H that Australian officers are to become displaced persons while Indonesian officers will be trained.


– Order! The final part of the question is out of order on the ground that a question on the same subject is, by request, to be placed on the noticepaper.

Mr Calwell:

– No, that is not so, Mr.

Speaker. This question is about the training of Indonesian officers.


– The portion referring to displaced persons is cut of order because it relates to a question mat the Leader of the Opposition has been asked to put on the notice-paper.


– I inform the honorable gentleman that I have received no request to train Indonesians in the Australian Army.

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– Can the PostmasterGeneral tell the House something about the cross-bar type of rural automatic exchange? I understand that this type of exchange can be economically installed for far fewer subscribers than the present type and would be a great boon in sparsely settled country areas. Can the Minister say what plans his department has in relation to it?

Postmaster-General · DAWSON, QUEENSLAND · CP

– The cross-bar type of exchange equipment is not actually new. It was in operation many years ago but, for a time, it was displaced by other types of equipment in automatic exchanges. However, in the last year or two there has been considerable development in the crossbar type with the result that we are now satisfied, as a result of investigation both in Australia and overseas, that it offers better opportunities for the establishment of new exchanges than th; other system. Before finally committing ourselves to the changeover, experiments were carried out for a period of years. The department has purchased cross-bar equipment to install in the Toowoomba automatic exchange, which is at present under construction. This system has the advantage of being capable of operation with much less supervision than the other types. Its liability to error is very much less. It requires less space. Consequently, from all points of view, it would appear that such automatic exchanges can be installed and operated for less than other exchanges. I am referring particularly, at the moment, to large exchanges but, as the honorable member has pointed out, the system also has advantage in the smaller type of automatic exchanges. Consequently it would be quite a factor in the overall long-range planning by the department for automatic services throughout Australia.

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Mr J R Fraser:

– I ask the Prime Minister: Will he give further consideration to a suggestion that the Seat of Government Administration Act be amended to incorporate the provisions of section 92 of the Constitution as was done with the Northern Territory Administration Act? Does he recall that I raised this matter with him on a number of occasions and that he undertook to have a look at what he described as “ this fascinating problem “?


– I know that some work has been done on this matter. I am not aware of the point it has reached, but I will find out and advise the honorable member of what I learn.

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– I ask the Minister in charge of the Commonwealth Scientific and Industrial Research Organization whether that body has investigated a reported new process, for which an Australian company is said to hold the patent rights, for treating wool against mildew and certain bacteria. Can he give me any information about this new process?

Dr Donald Cameron:

– The C.S.I.R.O. has done a small amount of investigation into the claims made for this process. So far the results have been to confirm the claims made for its antibacterial quality, but we have not yet been able to confirm the claims made for its antifungal properties. These are the ones concerned with mildew.

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– I address a question to the Minister for the Army. In addition to the information he gave this morning that there was a purge of generals-


– Order! The Minister for the Army has had a question directed to him concerning that matter which he has asked to be placed on the notice-paper.


– It is not yet on the notice-paper.


– Order! 1 rule that the honorable member’s question is out of order.

Mr Haylen:

– I was about to address another sector of the question to the Minister, and you have not yet heard it.


– Order! That portion of the honorable member’s question already addressed to the Minister for the Army is out of order.

Mr Haylen:

– Well, is this section out of order?


– Order! The honorable member will resume his seat.

Mr Haylen:

– But I want to ask the Minister a further question.


– Order! The honorable member will resume his seat.

Mr Haylen:

– You are as much a Czar as he is.


– Order! The honorable member will apologize for the statement he has just made.

Mr Haylen:

– Well, I apologize; you do not look like a Czar either.


– Order! The honorable member will resume his seat.

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– In view of the fact that a considerable number of widows receiving social service payments are faced with the position that their children, on reaching sixteen years of age, are compelled to cut short their school courses to take up work, will the Minister for Social Services consider ways and means of alleviating this most pressing problem?

Minister for Social Services · RIVERINA, NEW SOUTH WALES · CP

– I would be pleased to consider the matter raised bv the honorable member, but 1 remind him that from time to time additional assistance has been given to widows who have dependent children under the age of sixteen years.

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– My question to the Treasurer concerns taxation on owners of home units. Is he aware that owners of home units often form a commercial company charged with financing certain recurring communal responsibilities such as municipal and water rates, insurance, painting and general upkeep of the exterior and some internal portions of the complete housing block? Is the Minister aware that many owners of home units are age, widow and repatriation pensioners and retired superannuees and, as such, find it necessary to make regular weekly contributions to the communal fund to meet the previously mentioned expenses? Is it a fact that all such accumulated funds, as at 30th June each year, are subject to taxation? If these are facts, will the Treasurer consider recommending an alteration of the provisions to allow such funds to be exempt from taxation?


– I confess that I am not familiar with the process and the kind of detail to which the honorable member has referred. Now that he has brought it to my notice, I shall discuss it with the Commissioner of Taxation. To the extent that it raises an issue of policy, that will be. dealt with in due course in the normal way.

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– My question is to the Treasurer. Is it a fact that for some time in international monetary circles arguments have been considered relating to proposals for an increase in the price of gold as a means of improving international liquidity? Australia, as a major gold producer with a rapidly developing economy, would naturally have a vital interest in such proposals. Will the Treasurer say what is the present position regarding this matter?


– The international authority to which the honorable gentleman refers, which would be concerned with this matter, is the International Monetary Fund, of which Australia, in common with more than 60 countries, is a member. It is a fact that Australia has a very direct interest in this matter and would, we believe, be greatly advantaged by an increase in the price of gold. That price has not moved in accordance with other movements in commodity prices in the post-war years on a scale that would be regarded by most people as reasonable in all the circumstances. The issue has been raised in recent years on the board of governors of the International Monetary Fund by the representative of South Africa. That country, of course, also has a most important interest in the problem, and Australia has given strong support to the case advanced by the South African representative. That case, however, has not received support from the United States Government, without whose endorsement no movement in the price of gold is practicable, and the present Administration in America has shown itself to be firmly opposed to any increase in the price at present. That is where the matter stands.

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Mr Clyde Cameron:

– I wish to direct a question to the Treasurer. By way of preface I should like to explain that under a recent ruling of the taxation authorities a taxpayer has been called upon to pay tax on the income derived from money received as the purchase price of an annuity, but has been refused as a taxable deduction the amount paid out as annuity. In view of the fact that there are two conflicting High Court decisions on this very point, will the Treasurer consider resolving the issue in favour of the taxpayer?


– If the honorable member has further details of a particular case I should be glad if he would supply them to me. I shall undertake then to discuss the matter with the Commissioner of Taxation, and then to see what course should be followed by the Government.

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– 1 direct a question to the Minister for Trade. There have been suggestions recently that Japan has not increased her purchases of Australian wool since the trade agreement with that country was signed in 1957. Will the Minister comment on this and inform the House of the trend in Japanese woo! buying from Australia in recent years?


– It would be true to say that the value of Australian wool purchased by Japan has not increased. That is due to the world level of prices for wool. But the quantity of wool purchased by Japan from Australia has increased quite substantially since the conclusion of the AustraliaJapan trade treaty. In 1956-57, Japan purchased, I think, 240,000,000-lb of wool, whereas in 1958-59 she purchased 280,000,000-lb. of wool. During the current year, Japanese purchases have been at the rate of 330,000,000-lb. a year. Of course, I cannot say whether that rate will be sustained but it is the one which exists at present. Japan, therefore, has become the major wool buyer on the Australian scene.

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– I address my question to the Minister for Health, and wish to refer to the sedative drug Bonadorm which is prescribed for persons suffering with heart trouble or blood pressure. If prescribed in mixture form it is included on the free list, and 50 doses cost approximately 8s. 9d., but in this form it is most unpleasant and unpalatable. For that reason, very few doctors prescribe it as a mixture. However, it can be prescribed as a tablet, but in this form it is not included on the free list and the equivalent of 50 doses of the mixture costs the unfortunate person £1 ls. 6d. Will the Minister consider having this drug in tablet form included on the free list? If he is unable to do so, will he refer the matter to his advisers?

Dr Donald Cameron:

– The question of whether a drug should be included on the pharmaceutical benefits list, as well as the question of the form in which it should be made available, is decided by the Pharmaceutical Benefits Advisory Committee. I shall have the matter raised by the honorable member referred to that committee for an opinion.

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– My question to the Postmaster-General is supplementary to the one which was asked by the honorable member for Wentworth. Can the PostmasterGeneral say whether the Post Office profit this year of £6,000,000 will be used to finance capital expansion in the depart ment? Is it a fact that the department intends to spend £39,000,000 this year on new telephone and postal facilities? Will the balance of £33,000,000 have to be found by taxation and’ paid out of Consolidated Revenue? Is it not correct that users of postal facilities should make some contribution towards the improvement of these facilities?


– The last few words of the honorable member’s question really sum up the position, and supplement the statement made by the Treasurer. The honorable member has asked for additional information, and no doubt some further figures on this matter will interest honorable members generally. Although the commercial accounts of the Post Office indicate a profit of £6,000,000 for the year 1958-59, the department drew £36,300,000 from Consolidated Revenue to meet its capital works programme. For the five-year period prior to 1958-59, the department drew £155,000,000 from Consolidated Revenue purely for capital works, whereas according to the commercial account, its aggregate profit was about £12,600,000. But if the comparison is taken back still further, the position becomes even more alarming because in the years prior to the five-year period to which I have referred there were losses.

The Treasurer has pointed out that the method of preparation of the commercial accounts is at present under consideration by an ad hoc committee. I believe that when the committee’s report has been received, we shall be in a better position to present to the people generally a true statement of Post Office finances.

I think that, in answering the question directly, I can state the practical position as distinct from the accounting position by pointing out that in the financial year 1959-60 the total demands of the Post Office on Consolidated Revenue will amount to about £145,000,000. This represents about £105,000,000 to be drawn for the financing of the ordinary operations of the service and £39,400,000 for the capital works programme which we have on hand. Against that, the total return-

Mr Ward:

– Oh!


– I know that the honorable member does not like to hear these figures. The total return to revenue by the Post Office will be about £120,000,000. So that a net amount of about £25,000,000 will be drawn from Consolidated Revenue. I think that the basic answer to the question is that in the current financial year, in spite of the increased tariffs, about £25,000,000 will still have to be drawn from Consolidated Revenue, and, therefore, from the tax-payers.

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– My question is directed to the Treasurer. It refers to the black market that has developed in relation to finance sought by ex-servicemen who have been given permission by the War Service Homes Division to arrange temporary finance for the purchase of an existing home. Does the Treasurer consider that it would be any more inflationary for the Government to make finance immediately available than it is to allow private financiers to advance the capital required at exorbitant rates of interest? If the right honorable gentleman thinks that it would not be any more inflationary for the Government to provide the funds immediately, will he confer with his colleague, the Minister for National Development, who administers the division, in an effort to have completely abolished this waiting period which has now persisted for several years?


– This Government has a record of which it is very proud in respect of the provision of finance for war service homes. It has provided more finance, and, as a result, more homes, tor ex-servicemen during its term of office than were provided throughout the whole of the previous history of this Commonwealth. Last year, new dwellings provided from one source or another throughout Australia totalled about 85,000 housing units.

Mr Whitlam:

– They did not.


– That is a record which, I claim, is truly remarkable when measured against the standards set by any other country to which Opposition members can point.

Mr Ward:

– That is not-


– Order! T ask the Treasurer to resume his seat for the moment. From the Opposition side of the chamber are coming continual interjections, some of them from honorable members who really should set an example to their colleagues. I ask honorable members to obey the Standing Orders. The offenders are fully aware that interjections are out of order. If question time, in which all honorable members are interested, proceeds in this atmosphere, it may be better for the Prime Minister to take some action.


– I only wish to add that, although it is undoubtedly a fact that some ex-servicemen, in order to bridge the gap in time or money between the provision that can be made under the War Service Homes Act and what they need, pay a rate of interest very much higher than that charged by the War Service Homes Division, the conditions of the scheme, on the other hand, are very much more attractive than are the terms that exservicemen could obtain if they were not able to enjoy the benefits of this scheme. Fortunately, throughout the term during which this Government has been in office, there has been available to people in this category, as a result of the Government’s economic policies, a substantial amount of money which has made possible the remarkable building record which I have just mentioned.

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– I direct to the Minister for Defence a question concerning recently published reports of the development of an electronic device which can be fitted to aircraft and which is capable of neutralizing the guiding principle in a guided missile. Have the Minister and the Department of Defence any information about this device, particularly as to whether any Australian officers were associated with its development and whether its use will necessarily eliminate the need to continue the programme of guided missile experiments at Woomera?

Minister for Defence · DENISON, TASMANIA · LP

Mr. Speaker, the honorable member for Lilley has raised a subject which is. in some ways, very highly classified, but I think that part of his question can be answered. It is true that there is now a device which can jam and interfere with certain typesof missiles. As the honorable member would know, missiles are guided in various ways; some home on the target by infra-red radiation and some by radar. The conventional radar is the mono-pulse type, and if is possible to jam the radar in between the impulses. That is the particular device to which the honorable member has referred. I can assure him, however, that our scientists in Australia are well aware ofthese new inventions; indeed, our chief scientist was one of the pioneers of radar in the early days of Dr. WatsonWatt, and he has maintained his professional and technical interest in this matter. Our scientists are well informed on this question of jamming, and the honorable member can rest assured that nothing will arise of which we are not well aware at Woomera.

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Motion (by Mr. Harold Holt) agreed to -

That leave be given to bring in a bill for an act to extend the term of office of the Commissioner of Taxation.

Bill presented, and read a first time.

Second Reading

Treasurer · Higgins · LP

– by leave - I move -

That the bill be now read a second time.

The sole purpose of the bill is to extend for a period of one year the term of office of the Commissioner of Taxation. Sir Patrick McGovern. In the terms of the existing statute, the commissioner’s present term will come to an end on 3rd April, 1960, that being the date upon which he will attain the age of 65 years. Sir Patrick was first appointed Commissioner of Taxation on the 6th May, 1946, for a term of seven years. He was re-appointed for a further term from 6th May, 1953.

Section 5 of the Taxation Administration Act provides that where a person appointed to be Commissioner of Taxation is over 58 years at the date of his appointment or re-appointment, as the case may be, his term shall end or. the date on which he attains the age of 65 years. Upon his reappointment in 1953, therefore, the present commissioner’s term was for the period ending on 3rd April, 1960.

Honorable members will recall that the Government recently appointed a committee to investigate the taxation laws. This committee is at the beginning of its deliberations and it will be looking to the taxation administration for information and other assistance on the matters coming before it. In view of his long experience in this field, it is highly desirable that Sir Patrick McGovern should be available for these purposes.

Honorable members will also recall that in a review of the taxation administration made recently by the Government, it was decided that the great increase in the volume and complexity of administrative duties which has occurred in the last few years made necessary some spreading of the load, and a bill to provide an additional Second Commissioner was presented to Parliament and accepted by it. To ensure the full benefit of this additional office, a major re-organization of administrative functions has been necessary and this will take some time fully to settle down. In these circumstances, it would be inconvenient to have a change in the top administration at this stage. Sir Patrick McGovern is willing to continue in office for a period of twelve months, and it is considered to be in the interests of the Commonwealth that his period of appointment should be extended accordingly. I have pleasure in submitting the bill for the favorable consideration of the House.

Debate (on motion by Mr. Crean) adjourned.

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Motion (by Mr. Hasluck) agreed to -

That leave be given to bring in a bill for an act to provide for a guarantee by the Commonwealth in respect of public loans in the Territory of Papua and New Guinea.

Bill presented, and read a first time.

Second Reading

Mr. HASLUCK (Curtin- Minister for

Territories) [11.21]. - by leave - I move -

That the bill be now read a second time.

This bill is a simple measure serving one purpose only. It proposes to amend the Papua and New Guinea Act so as to give a Commonwealth guarantee to any loans borrowed under the laws of the Territory of

Papua and New Guinea. The term “ public loan “ used in the bill is intended to cover loans raised by agreement as well as loans raised by public subscription. Sir, although the bill itself is a simple one and does not contain any controversial matter, the House may be interested in some of the background to it.

Some time ago, the Government made a decision that we should seek to add to the amount available for expenditure on public undertakings in the Territory of Papua and New Guinea by local borrowing solely for local purposes, and instructions were given to the Administration accordingly. Unfortunately, it has taken much longer than we had hoped to give effect to the Government’s decision. We were breaking new ground and there were a few doubts and a number of practical problems to be overcome. Last September, however, the Administration had advanced far enough in its work for the Government to place before the Australian Loan Council a definite proposal for the raising of a loan in the Territory. Loan Council approval having been received, the Administration of the Territory introduced a bill in the Legislative Council for the Territory last February to provide the machinery for the raising of loans by the Territory Administration by such means as inscribed stock and treasury bonds and by means of agreement with individual investors. The first loan will be raised in the amount of £100,000 - a rather modest sum - and will be launched early next month. Before the launching of that first loan, it will be necessary to pass the bill now before this House so that the Commonwealth can guarantee the due payment of all moneys, including interest, payable by the Administration under Territory borrowings.

When, as Minister for Territories, I first put this proposal before my colleague the Treasurer and eventually, with his support, recommended it to the Cabinet, several supporting arguments were advanced. It may be of interest to the House to know what those arguments are. The first and most obvious advantage is that local loan raising will add to the amount of money available for public expenditure in the Territory. It was, and is, the Government’s intention that loans shall be raised for particular projects - for example, electricity supply projects - which will be of continuing value to the Territory. In other words we will apply the proceeds of loans to finance works and projects similar to those which are usually included in loan works programmes. The growth of trade and the growth of Government expenditure in the Territory have resulted in very substantial increases in the capacity of the Territory community to contribute towards loans. For example, the export trade of the Territory has now advanced to a total of over £16,000,000 a year and expenditures by government and semigovernmental instrumentalities are now of the order of approximately £20,000,000 a year.

An indication of the consequential changes in the amount of money in the Territory is given by figures which I use simply as an index and not to prove any particular point. Savings bank deposits in the Territory have risen dramatically in the last five years. Their increase from approximately £2,000,000 to approximately £5,000,000 is without parallel in any other part of the Australian community. No other part of the Australian community has shown anything approaching the increase in general banking business that has been shown in Papua and New Guinea in the past ten years. In no other part of the Australian community has the growth of trade been proportionately so great. In addition to savings bank figures, I have seen privately some figures relating to the business written in stocks and shares and in life assurance in the Territory. These figures underline the point that there is money to spare in the Territory at present.

In addition, the indigenous people are participating in the increased economic activity in the Territory. Over 25 per cent, of several of the major export crops are being produced by them and an estimate made by our agricultural department shows that the cash crops produced by native growers in 1958-59 were valued at over £3,000,000. Translated into practical terms, this means that in the course of the year over £3,000,000 in cash found its way directly and immediately into the hands of native agriculturalists. Many of them are not banking their money, but are hoarding it in their own private hiding places. It is clear, of course, that the Territory community, including the indigenous people, will need to use a great deal of its earnings for the expansion of its enterprises and we hope that reinvestment of earnings in the Territory industries can be encouraged. We believe, however, that there is a significant amount that might be available for lending to the Administration for public developmental works, as distinct from private developmental activities, and that a feeling of local patriotism will give many members of the community, both indigenous and European, a real and lively interest in making this contribution to the progress of their own country, while at the same time benefiting from a sound investment.

The second argument used for raising local loans might be called an educational one. This argument applies particularly to the indigenous people. Now that they are becoming possessed of cash, and their interest in economic matters is growing, there will be value to them and to their country in training them in the process of government on the economic side as well as encouraging them in thrift.

Minister for Territories · CURTIN, WESTERN AUSTRALIA · LP

– I could interpose here. Native co-operatives have, of course, expanded very considerably and now have an annual turnover of more than £1,000.000 a year. Some of the co-operatives are producers’ co-operatives, some are consumers’ co-operatives and some are a mixture of both. The growth has been quite remarkable. I should say, however, that the cooperatives are not regarded by us as being the final or the sole answer to the economic advancement of the native people. They are one of many instruments that can be used to assist them, particularly in the early stages of economic development, partly in the problems of financing communal ventures and very largely in the problems of management of ventures. At a time when the individual Papuan may not be possessed himself of enough capital to start an enterprise, capital can be found through co-operation and Government advances to the co-operatives, and at a time when the individual native lacks the skill and knowledge to manage his business affairs, if a co-operative is formed the cooperative can employ a clerk trained by the Government in order to supply the needs of management.

Having said that, I return to this other phase of the education of the native people in economic activity, which is represented by this loan proposal. We want to encourage them in thrift. We want to encourage them to understand how public undertakings are financed. Instead of putting their surplus money in a bottle and burying it underneath a house, we hope that they will be induced to make an investment in public loans, knowing that these public loans will be used for their own advantage and will enable their money to earn interest for them. In this connexion, I may say as an aside that we have adopted one or two unusual expedients in connexion with the proposed loan of £100,000 which we hope will come mainly from native sources. The certificates are to be made of a durable material and enclosed in a plastic cover so that they will not deteriorate when stored in a native village under tropical conditions. If we issued the ordinary bond or script, who knows, within twelve months it may have disappeared. With the co-operation of Commonwealth authorities, we have devised some unusual methods of overcoming these special problems of investment in loans by people who are still largely illiterate and unfamiliar with these processes, and living in village conditions, so that their bonds will be as durable as the money they put in a bottle.

Mr Whitlam:

– Inflation is not the only eroding influence in New Guinea.


– No; the climate has eroding effects much greater than those of inflation.

The third argument in favour of local loan raising is that with the growing maturity of the Territory, we should attempt to develop in the Territory more of the customary institutions and adopt more of the customary procedures of government. Taking a long-term view, there will also be some value if we can identify the public debt on works which will serve not only the present generation but future generations. For example, in public utilities - and again I use electricity supply as an example - instead of simply providing electricity by expenditures out of general revenue, we have long been accustomed in Australia to identifying the capital expenditure of such a utility and financing it over a long period. I would hope that year by year more and more of the capital expenditure on public utilities in the Territory will have their separate identification in this manner. In that way, I hope that the people of the Territory will see more clearly the processes of government, particularly on the financial and economic side. It is becoming clearer than ever that we should move more rapidly than we have been doing away from the practice of everything being paid for by the Government out of revenue and the payment being promptly forgotten. With selfgovernment as the goal for the Territory, we have to work along every line towards a greater maturity in the structure of governmental enterprises and a fuller participation by the community in those enterprises. Although the financing of them is only one aspect of this matter, it is an important aspect.

Mr Wheeler:

– I envisage that the Commonwealth Government will guarantee the loans.


– Yes.

Mr Wheeler:

– What has the Minister in view for the flotation of the loans? Are they to be underwritten or is this to be solely a Government responsibility?


– I will come to that in a moment, if I may first complete the point I am making.

Mr Wheeler:

– I am sorry; I thought you had finished.


– In connexion with the point I was making, I do want to have it plainly understood that I am not suggesting that in the near future Australia will be able to reduce the amount of financial assistance given to the Territory. Indeed, it is quite plain that for many years to come the amount of that assistance will have to increase very greatly if the job we are doing is to be well done. But in a modest way we should make a start now towards financial self-help for the Territory. The modesty of the start is illustrated by the fact that the first loan to be launched next month will be for only £100,000, whereas the total expenditure on the Administration Budget is over £17,000,000. This is the first venture but I would hope, however, that an annual loan programme of, say, £500,000 is well within the reach of the Territory at the present time, having regard to the aspects to which I have already referred.

The procedure for future loan raising will be similar to that for loan raising throughout Australia for semi-governmental bodies, and that analogy may answer, in part, the question of the honorable member for Mitchell (Mr. Wheeler). Each year the Territory will make its application, through the Commonwealth Treasury, to the Australian Loan Council and, on receiving the approval of the council it will proceed to borrow in the amount and on the terms and conditions which have been approved by the council. There is room in the Territory legislation for the Administrator to raise the amount approved, either by public subscription - a loan launched in the way in which public loans are usually launched - or by negotiation. We do not have any prospect at the present time of negotiating a loan bv agreement; but there is provision for that to be done and. as there are in existence in the Territory funds such as the superannuation fund that might properly be invested in an Administration loan I anticipate that most of the agreement loans raised in the Territory will be lent to the Government by bodies such as the superannuation fund.

Mr Bury:

– Would it follow the general pattern of semi-governmental loans?


– Yes. In saying that, I want the honorable member to understand that T am not anticipating the terms and conditions yet to be announced for this loan of £100,000. That is something yet to be announced. As T stressed at the outset, the bill now before this Parliament is a very simple one, devoted to the sole question of a Commonwealth guarantee for Territory loans. That is the only point upon which the House is asked to vote and I feel confident that the House will not withhold the guarantee for which we ask. I hope that this Parliament will add to the guarantee its blessing and good wishes for the further strengthening of the financial and economic structure of the Territory and for its continuing prosperity.

Debate (on motion by Mr. Calwell) adjourned.

page 333


Motion (by Mr. Adermann) agreed to -

That leave be given to bring in a bill for an act relating to the constitution of the Australian Wheat Board.

Bill presented, and read a first time.

Second Reading

Minister for Primary Industry · Fisher · CP

– by leave - I move -

That the bill be now read a second time.

The purpose of this bill is to amend the Wheat Industry Stabilization Act 1958 to provide for the appointment to the Australian Wheat Board of an additional member representing the Queensland wheatgrowers. Section 7 of the current act, which constituted the board, provides that each mainland State, with the exception of Queensland, shall have two growerrepresentatives on the board. Queensland, which has a relatively small though valuable wheat industry, has only one grower-member. Following representations from the Queensland Minister for Agriculture and Stock, and the Australian Wheatgrowers Federation supporting additional Queensland grower representation on the board, provision was made in the 1958 act for the appointment of an alternate member for Queensland who could attend any meeting of the board at which the member concerned should be unable to be present.

However, this form of representation has been found to be not entirely satisfactory as it has placed considerable strain on a single member to attend frequent meetings of the board and carry out the other functions concerned with his membership, whilst at the same time it has been difficult for the alternate member, by virtue of infrequent attendance at meetings, to attain a wellbalanced knowledge of the board’s business. The Australian Agricultural Council and the Australian Wheatgrowers Federation have indicated their support for an additional full grower-member for Queensland in lieu of the present alternate member. This measure will assist the efficient opera tion of the Australian Wheat Board and it will give appropriate recognition to the growing importance of Queensland as a State now producing in a normal season a substantial quantity of premium quality wheat for export. I commend the bill to honorable members.

Debate (on motion by Mr. Pollard) adjourned.

page 333


Motion (by Mr. Freeth) agreed to -

That leave be given to bring in a bill for an act relating to the Parliamentary Standing Committee on Public Works.

Bill presented, and read a first time.

Second Reading

Minister for the Interior and Minister for Works · Forrest · LP

– by leave - I move -

That the bill be now read a second time.

This bill proposes to extend the power of the Parliament, through the Standing Committee on Public Works, to scrutinize the majority of public works projects proposed to be carried out for the Government. It proposes to extend the authority of the Public Works Committee in three ways: First, the existing act provides that the Minister may move in the House of Representatives that a proposed work estimated to cost more than £25,000 be referred to the Public Works Committee for report. The first thing that the new bill proposes to do is to remove that minimum limit of £25,000, because it is considered that not frequently, but occasionally, there may be a public work estimated to cost less than £25,000 which ought to be examined by the Parliament, such as a work where some important national interest is involved or some new feature of architecture is introduced. The existing act also provides that the Minister may move in the House that a work costing more than £25,000 shall be referred.

It is proposed in the second part of the bill that no proposed public work which is estimated to cost more than £250.000 shall be commenced unless it has been referred to the committee for a report to the House. This will be subject to some limitations. The House may resolve that the work may proceed without reference to the committee. This passes the discretion in the matter from the Minister to the House. Again, the Governor-General may, by order, declare that the work is for defence purposes, and that reference to the committee would be contrary to the public interest.

The House will perceive that, in future, any proposed public work estimated to cost more than a quarter of a million pounds will, in the normal course of events, be considered by the Parliamentary Standing Committee on Public Works. It will be so considered unless the House decides that it shall not be referred, or unless it is declared to be a defence project that should not be referred in the interests of the public.

The third extension of authority of the committee involves its being given power to review its own reports so long as the actual work on which it has reported has not been commenced. At present, once the committee has tabled its report in the House, it cannot re-examine its works proposal except by a resolution of the House. In some cases, before the Government is able to find funds to commence a project, some years elapse. The committee may have additional information or circumstances may have changed, making it desirable for the committee to have another look at the project on which it has reported. The bill provides that if the work has not been commenced the chairman or vicechairman may notify the Minister in writing that the committee has decided to review its report, and in such circumstances the work will not be commenced until the committee resolves that it does not desire the commencement of the work to be deferred, or until a further report has been presented, or until the House resolves that the work shall proceed, or until the life of that Parliament expires without the presentation of a further report from the committee.

Mr Duthie:

– Could the Minister refuse the committee an opportunity to look at it a second time?


– That could be done only by resolution of the House. If the House had previously resolved that it was expedient to carry out the proposed work, a further resolution from the House would not be necessary unless the House, on the presentation of the further report, wished to cancel its previous approval.

This, I think, is a very desirable feature, strengthening the methods by which the Parliament may scrutinize or control major public works projects. The amount of £250,000 has not been plucked out of the air or decided by guesswork. It has been fixed after consideration of the number of major projects on which the Government is engaged, the relative amounts of time available to the Public Works Committee to look at these projects, the desire not to delay comparatively minor projects for too long, and other aspects such as the time and cost involved in presenting evidence before the committee. The officers of the Department of Works have to spend a considerable amount of time in preparing cases for consideration by the committee. The committee’s consideration takes several months, as a rule, and by the time its report is prepared and tabled in the House, and the House has been able to examine it, usually some six months or even more have elapsed. These considerations have led to the fixing of the amount of £250,000 as a reasonable limit for mandatory references to the Public Works Committee. I commend the bill to the House.

Debate (on motion by Mr. Whitlam) adjourned.

page 334


page 334



Debate resumed from 16th March (vide page 303), on motion by Mr. Murray -

That the following Address-in-Reply to the Speech of His Excellency the Governor-General be agreed to -

May rr Please Your Excellency:

We, the House of Representatives of the Commonwealth of Australia, in Parliament assembled, desire to express our loyalty to our Most Gracious Sovereign, and to thank Your Excellency for the Speech which you have been pleased to address to Parliament.

Upon which Mr. Calwell had moved, by way of amendment -

That the following words be added to the Address:-“, but desire to advise Your Excellency that the Government no longer possesses the confidence of the Parliament and of the Nation because of -

Its failure to halt inflation with its adverse effects on wage and salary earners, on pensioners, on persons on fixed incomes, on primary producers and on home builders, particularly those with young families; <2) Its action in lifting import restrictions with its accompanying threat to the employment of thousands of Australians and the security of Australian enterprises; and

Its decision to ask the Arbitration Commission to reject the current application of the trade union movement for an increase in the basic wage “.


.- At the outset, I would like to associate myself with other honorable members who have already expressed their feelings of loyalty, their congratulations to Princess Margaret, their welcome to His Excellency the Governor-General, and also their congratulations to the new Leader and Deputy Leader of the Opposition.

There are many features of the Address that would be well worth talking about, but I propose this morning to confine myself, first, to expressing my pleasure, and the pleasure of most Queenslanders, at the mention made of the £20,000,000 which will be available for the Mount Isa railway. This is something that some of us felt was long overdue, but we are very glad and very grateful that we have now been promised this assistance. It will enable a big step forward to be made in the development of a State which is merely on the threshold of its development.

Mention was made in the Address of the fact that the Government will, before the presentation of the next Budget, consider two problems associated with the application of the means test to the general pensions system. I hope that when considering this matter the Government will come to the conclusion that one of the ways in which the means test is applied is quite wrong, in that it is applied to property, not to income. Until a few years ago it was possible for a person to own his own house and to convert one or two rooms of it into a flat which would bring him in an income of £3 or £3 10s. a week, and so place himself on a par with a person receiving an equivalent amount from superannuation - which is not considered under the means test - or with a person able to earn a small amount each week. But the position was changed, and I have found, with great regret, that some people who have for years been letting a flat or a few rooms in this way are now having their premises inspected and checked by officers of the Department of Social Services. The value of the portion of the premises being let is then taken into account in the computation of property owned, and the pensions of these people are being reduced accordingly.

I believe that this was never the original intention of the amendment brought in a few years ago. That amendment was meant to take care of cases such as one I call to mind - that of a woman who owned a hotel, and who was able, because of the loopholes in the act, to lease that hotel for about £90 a week, retain the right to live in some of the rooms for the rest of her life, and, at the same time, collect a full age pension. This was quite wrong, and the Minister was quite right in amending the legislation to prevent it. But I feel that the opposite extreme has now been reached. If a person can receive an income of up to £3 10s. a week from the premises in which he resides, I believe he should be allowed to do so without putting his pension rights in jeopardy. I hope that consideration will be given to this matter when other aspects of the legislation are being considered, as we have been told they will be before the next Budget is prepared.

I would now like to mention the section in the Governor-General’s Speech which states that the Government is giving consideration to the report of the committee which inquired into Public Service recruitment. I would like to make specific mention of that section of the report which deals with the recruitment of physically handicapped persons into the Public Service. As we all know, there is a rehabilitation section in the Department of Social Services which does a splendid job in getting some handicapped people back into a physical condition in which they can lead something like a normal life and support or partly support themselves. Not completely, but as a general rule, the handicapped person who has been rehabilitated, is expected to go into private employment rather than into government employment. Some people who have been partially crippled by poliomyelitis, meningitis and other diseases become capable of passing the entrance examination for the Public Service. Yet when they go for their medical examination they are not accepted.

I know of a lass of about 26 who had suffered from meningitis when she was about thirteen months old and, as a result, had become a spastic cripple. For many years she was in receipt of the invalid pension. By tremendous effort and determination she overcame those handicaps and was able to pass the entrance examination for the Public Service. She obtained a position in the Public Service, but after a few months the report of the medical examiner was received stating that she was not medically fit to remain permanently in the Public Service. Her services were terminated. The letter that terminated those services finished with these words - and your name has been removed from the list of successful candidates at examination 4709.

To somebody who had striven tremendously hard to pass that examination, those words were a shocking blow. I understand it is a technicality that a letter stating that the person’s name has been removed from the list of successful candidates must be sent in order that the names of succeeding candidates can be brought forward for appointment. But I believe that there should be and there must be a better way of wording letters of this nature. If the present wording causes offence and hurt to only one person in 5,000, it is completely unnecessary.

I know that this matter has been discussed and that it has been taken to high places before, but we have never got anywhere with it. I hope that, eventually, we will get somewhere with it. I can see no reason why a physically handicapped person who can expect a reasonable life span and who can be expected to do a reasonable amount of work cannot be taken into the Public Service permanently, more or less on the same basis as some people are accepted into the armed services, particularly in war-time. If such persons have a physical handicap or if they have had an illness which has left a mark on them, it is taken into consideration and they cannot be superannuated out of the Service because of anything connected with that illness. In other words, if that illness prevented them from continuing and forced them to leave the Service they would not receive full superannuation benefits. Bui there is no reason why such persons should not receive superannuation if they are prevented by other disabilities or illnesses from continuing their service. This would mean a comparatively small amount of extra administrative work, but it would give happiness to hundreds of people and make them feel that they were playing a full and proper part in life. They are entitled to that satisfaction. I believe that the Commonwealth Public Service, with its splendid rehabilitation scheme in the Department of Social Services, should be one of the leading employers of physically handicapped people, as should other government instrumentalities.

These people of whom I have been talking, on the whole, although not invariably, have a higher standard of work than the person who is not handicapped. Even if they are not capable of carrying out a particular job with 100 per cent, efficiency, J can see no reason why a number of them should not be employed if they are capable of working at or over 70 per cent, efficiency. It is far better for them to be doing that than sitting doing nothing and receiving a pension.

There is one other point to which I believe some consideration should be given. At the end of the war period it was quite difficult for Commonwealth departments to get people to work in the Public Service. There were some people who had been working there during the war on a temporary basis and many of them were asked to remain as temporary public servants at a time when their age, and the opportunities that were available in other jobs, would have enabled them to go out and get employment in which they may have been able to carry on for the remainder of their life. Many of these people stayed in the Public Service. Some of them who have been there for fourteen, fifteen, sixteen, seventeen, or eighteen years are now being dismissed on the ground that they are redundant or because of a drive for increased efficiency. I cannot help feeling that it should be possible, somewhere along the line, to hold back the recruitment of younger people in order to allow these people a complete and full term of work in the Public Service. I know it is a very vexed and difficult question but I believe that further consideration should be given to it. I hope that it will be given and 1 hope that we can assist at least those with long service to remain in the Public Service.

The Governor-General’s Speech makes reference to Qantas and overseas airlines. I would like to say a few words about a tendency that is developing in our internal airlines. The virtual abolition of competition between the major airlines and the gradual rationalization of services have been accompanied by a falling-off in the standard of service of both organizations. This is most regrettable. I believe that a first-class service can be maintained only by strong competition. We have seen in the course of the rationalization of services a withdrawing of aircraft from some routes which had previously been flown. That is a very unfortunate step. Partially, it was caused by rationalization and, partially, by the introduction of new types of aircraft. The Fokker Friendship, for instance, does not go into some airports which previously were served by the Dakota - the DC3 - particularly in southwestern Queensland. Not only has that represented a slightly backward step in the transport of the local population, but it is making it more difficult for the inlander who may need to operate a light aircraft to have the necessary maintenance work done. I believe that this trend is unfortunate for the development of the inland and the outback of Australia.

The Governor-General’s Speech commenced with the words -

You have been called together to deal with matters affecting the well-being and advancement of the Australian nation. 1 can think of few things which have affected the well-being end advancement of the Australian nation more than the Royal Flying Doctor Service of Australia. I have spoken about this service previously in this House, and I make no apology for giving again what is almost becoming an annual report on what the service is doing. I believe I am justified in that when we remember what the right honorable the Prime Minister (Mr. Menzies) said in 1954 when he was setting the foundation-stone of the John Flynn Memorial Church at Alice Springs. He said -

WhereverI have gone in the world I have found that the Flying Doctor Service of Australia is known and is vastly admired.Inside Australia we have long recognized that the Flying Doctor Service does represent perhaps the greatest single contribution to the effective settlement of the far distant back country that we have witnessed in our time.

I do not propose to go into the details of the origin of the service, but I should like to read a few lines written by a friend of mine, Group Captain Gordon Grant, about the founder of the Flying Doctor Service, the Right Reverend John Flynn. They are as follow: -

One man, and one alone, perceived the way

Whereby Australia’s sturdy inland folk

Would find some freedom from their constant yoke

Of Loneliness. So, in that early day

Of radio and flight did he portray

A plan whereby those factors formed a cloak

Of safety round the people. Thus he broke

The distance and its threat. The interplay

Of Inland Mission and the doctor’s plane

To-day brings Christian aid to all within

Their ambit, serving freely - not for gain

The white, the native stockman and his kin

The Afghan driver of the camel train,

Find friendly comfort - from the faith of


Those words set out the real reasons why the service came into existence - to cover the outback with a mantle of safety, combining the use of radio, medicine and aviation and so care for the people there. It encouraged those who were there to stay there, and at the same time it offered encouragement to women to go there and raise their families. These objectives have been greatly assisted by this undertaking.

In the field of national health the service, in the last year, carried out 10,500 radio diagnoses; it made nearly 14,000 clinical visits and administered 6.100 immunizations. It transported 804 white patients and 537 black patients for medical treatment. In a total of 1,458 medical flights, the service covered over 444,000 miles. It treated, in all, more than 6,000 native patients. It helped also in medical research in conjunction with State health authorities and assisted visiting scientists who are interested in topical diseases and various other scientific matters. It has helped considerably in industrial employment in the inland. It has handled over 229,000 telegrams and operates twelve main stations with which some 1,600 transceivers, regular and mobile are constantly working.

In the field of education with its radio broadcasts and school of the air, which are now operating from Alice Springs, Broken Hill, Port Augusta and, since this year, Cloncurry, tremendous assistance has been given to the youngsters in the outback. Their normal correspondence schooling is being considerably helped by the school of the air. In the field of meteorology, the remote stations linked with the Commonwealth Meteorological Survey provide weather reports. The service is coming more and more into the field of air search and rescue. It provides landing grounds and all its facilities are available 24 hours a day to the Department of Civil Aviation in connexion with this work. Apart from food dropping, in times of drought or flood, and spotting for people who may be lost, it was almost directly responsible for getting some families to go and work on the air beef scheme in the Kimberleys.

It is interesting to note that the Kimberley area of northern Western Australia is maintained almost entirely from Victoria. My friends from that State will realize, with all due respect, that it is not sufficiently large to need a Royal Flying Doctor Service but they have done a tremendous job in supporting that service in the Kimberleys.

Mr Turnbull:

– It is all quality.


– I am not denying the quality. The Queensland section of the service, with which I have the honour to be associated, covers an area from Charleville to Cloncurry and Charters Towers, which comprises two-thirds of the State of Queensland. We are hoping, in the not distant future to extend the service to Torres Strait to take in the islands there with their population of between 4,000 and 5,000 natives and several hundred Europeans. This will most certainly require amphibious aircraft.

At the present time we have been operating four Drover aircraft in Queensland but we find it necessary this year to re-engine them. Our normal operating cost in Queensland is about £95,000 a year, and the cost of re-engining these aircraft will be approximately the same. For the first time in the history of the Royal Flying Doctor Service it has been necessary to launch a public appeal for funds. This was done last Tuesday night by the Premier of

Queensland, Mr. Nicklin. The Commonwealth Government is quite generous to the federal body and Queensland has already received £36,000 towards the cost of reengining the four Drovers. The Queensland Government is also quite generous in its assistance by giving a subsidy of 25s. for every £1 raised by public subscription or donation. At the present time we have raised about £46,000 of the £90,000. Shortly after Mr. Nicklin opened the appeal, it was very gratifying to know that Major Rubin telephoned the Premier and said he was prepared to make a donation of 5s. for every £1 subscribed by other people. This was a very generous offer from a man who has already been extremely generous in the fields of medicine and art.

Some people might ask, “Why do you need to spend £90,000 to re-engine four aircraft? “ The answer is that we will get considerably greater efficiency. The old engines in the aircraft had had a very considerable amount of use and were needing attention. To those people in Queensland who may be listening to me I would say that I hope they will pay some attention to this appeal. I think particularly of people in the cities. At the present time more than 80 per cent, of the donations to the Royal Flying Doctor Service in Queensland come from areas directly served by it. But, Sir, that organization provides a service to the whole of the State, because the industries in the coastal areas exist as a result of the work that goes on in the inland. So I hope that people in this House will continue to be interested in the Royal Flying Doctor Service, and will support it in every way they can.


.- I think that everybody will agree that the speech just made by the honorable member for Bowman (Mr. McColm) was rather flat, because nobody could get very enthusiastic about the policy proposals of this Government. So I sympathize with the honorable gentleman. I should like to compliment and support him, however, on that part of his speech in which he referred to the Boyer report. The extension of employment opportunities for handicapped and crippled people in the Commonwealth Public Service should be supported. I also commend the honorable gentleman on his references to the appointment of ex-servicemen to permanent positions in the Public Service. We all know that many ex-servicemen returned from their service overseas partially disabled, and are now receiving small pensions. Such men who have gained temporary employment in the Commonwealth Public Service may not receive permanent employment, as things stand, and therefore their future is limited. After all, these men gave their services to this country in World War II., and now are not allowed permanent appointment in the Public Service. I believe that all honorable members should do their utmost to see that this position is rectified by the Government. I hope that the honorable member for Bowman will agitate within his party to have the Government face up to this problem and do the right thing about it, because handicapped, partially handicapped and crippled persons, as well as ex-servicemen on small pensions, are being badly treated by the Government.

I support the amendment moved by the Leader of the Opposition which states that the Government no longer possesses the confidence of the Parliament and of the nation because of -

  1. Its failure to halt inflation with its adverse effects on wage and salary earners, on pensioners, on persons on fixed incomes, on primary producers and on home builders, particularly those with young families;
  2. Its action in lifting import restrictions with its accompanying threat to the employment of thousands of Australians and the security of Australian enterprises; and
  3. Its decision to ask the Arbitration Commission to reject the current application of the trade union movement for an increase in the basic wage.

At the outset, I should like to express my strong disapproval of the hypocrisy of the statement on world disarmament in the Governor-General’s Speech. This Government speaks of disarmament, but proposes to increase defence expenditure this year by £10,000,000 above last year’s figure. This year it proposes to spend £192,000,000 on defence as against £182,000,000 last year. In its ten years of office the Government has spent more than £1,800,000,000 on socalled defence. It has spent £150,000,000 on national service training, and has now decided to scrap that project. The money expended by this Government on national service training is more than has been spent on the Snowy River project in the same period. There has been a great loss of manpower as a result of the youth of the nation being called up for national service. The total of £150,000,000 wilfully squandered on national service training could have solved this country’s housing problem.

We should immediately start to reduce our arms expenditure progressively, and divert the money to peaceful uses such as the development of our great country and the granting of economic assistance to our neighbours in the near north. We have a great responsibility to assist the underdeveloped nations of Asia.

Recently, the representatives of the Commonwealth Parliamentary Association held a conference in this chamber. We all know of the fervent pleas for greater economic aid that were then made by the representatives of backward countries in both Asia and Africa. But what do we find? Admittedly this Government scratches the surface of the problem with aid under the Colombo Plan, but it squanders money on defence instead of using it to help the under-developed peoples to raise their standards, and thus gain goodwill for this country.

This Government lives in fear - fear because of its lack of confidence in its own ability. We should go out and spread goodwill. We should help the people whom, in the past, we have exploited. If we assist them to develop their facilities, their education systems, their hospitals and their humane activities, and give them technical knowledge, we shall be helping to bring peace and, if I may say so, disarmament to this country.

Now, I should like to turn to a discussion of the economy and the present condition of inflation. I support the Leader of the Opposition and the Deputy Leader of the Opposition (Mr. Whitlam) in advocating extension of the economic powers of this Parliament. The Constitutional Review Committee, which sat over a period of two years, unanimously recommended that the economic powers of the Commonwealth Parliament be extended so that it could control capital issues. The Leader of the Opposition has challenged the Prime Minister on this score, and only last night the Treasurer (Mr. Harold Holt) made all the excuses he could find for the Government’s inaction on the issue. He said that we had this power and we had that power, and we could not really do anything. The truth is that the representatives of the Government parties who sat on that committee agreed unanimously that it was necessary to extend this Parliament’s powers over the economy. We believe that the whole question of the extension of these powers should be submitted to the people in a referendum, and if the people agreed to the extension of the powers, we could then deal with problems with which, up to now, we have had no power to deal.

Mr Duthie:

– We are working under a 50-years-old Constitution.


– Exactly! We are living in the past, and some people seem to think that the Constitution is too holy a thing to be altered to meet present-day needs. I believe that, in some respects, the Constitution is a barrier to progress.

I do not wish to dwell too much on that subject at this stage, because there are other matters with which I wish to deal. I should like, now, to mention some important facts which were brought out in the report of the Constitutional Review Committee. The committee has said that, in the five years prior to June, 1939, the trading banks provided 56 per cent, of all credit. Under banking legislation properly used by a government alive to its responsibilities, this Parliament has power to control banking. In the five years ended June, 1958, however, the banking system provided only 21 per cent, of all credits. So, the proportion of credit provided by the banking system fell from 56 per cent, before the war to 21 per cent, in the fiveyear period that ended in June, 1958. In the interval between those same two periods, the proportion of credit represented by the stock exchange jumped from 18 per cent, to 36 per cent.

Now, we come to the jump in the percentage of credit issued by hire-purchase organizations. We know that private banking concerns have turned to hire purchase as a means of getting a quick return on capital. Before the war, hire purchase accounted for only 2 per cent, of the credit in the community. It now represents 16 per cent. So, it is easy to see why private banking concerns are now shifting into the hire-purchase field.

We need greater controls in the federal sphere, and I support the Leader of the Opposition, and the Deputy Leader of the Opposition, in this respect. We on this side of the House believe that the powers of this Parliament under the Constitution should be extended in order to deal with such matters as I have mentioned.

I should like to deal now with the powers to curb inflation which have existed while this Government has been in office. When this Government came to power it promised to put value back into the £1, but almost immediately the inflationary trend commenced to lift. In 1950-51 the Government was in real trouble. On 26th September, 1951, the then Treasurer, Sir Arthur Fadden, introduced that infamous horror Budget. He imposed certain controls but, instead of curbing inflation, he accentuated it. The horror Budget implemented the policy of this Government to change from a system of direct taxation to a system of indirect taxation or, to put it another way, from non-transferable to transferable taxation. To an increasing degree the burden has been thrown on to the masses of the people, those on the lower incomes, the battlers, the people v/ho really need help.

Let me now comment on some of the aspects of the horror Budget and the infamous statement which was made by the Prime Minister (Mr. Menzies) on 14th March, 1956. The honor Budget resulted in taxation revenue increasing by £160,000,000. The only equitable aspect of the taxation proposal was that a 10 per cent, increase of tax was applied to all incomes. The remainder of the increased revenue was paid by public companies end private companies and through the imposition of increased sales tax and customs and excise duties, all of which are transferable. Radio licence fees were also increased.

When the little horror Budget was introduced there was a further increase in all indirect or transferable taxes amounting to £120,000,000. Sale* tax on motor vehicles accounted for £30,000,000; the petrol tax for £12.000,000; duty on beer £29,000,000, on spirits £2,000,000, and on tobacco and cigarettes, £12,000,000.

At this stage I should like the permission of the House to incorporate in “ Hansard “ a table showing the amount of each kind of tax, and the percentage of each amount to the total net collection. The figures con tained in the table have been obtained from the Budget papers covering the years 1951- 52 to 1958-59. [Leave not granted.] As leave has not been granted, I shall have to read the figures into the record. They are as follow: -

Honorable members on the Government side, and particularly the honorable member for Capricornia (Mr. Pearce), who is the Government Whip, would not allow me to incorporate the table in “ Hansard “ without reading it because they have not the courage or the honesty to let the people see what they have been doing. Thus, they have squandered the time of the House. The figures which I have cited indicate without doubt the hypocrisy of the Government. I shall not say any more in this strain because I cannot stomach spineless honorable members on the Government side who would deny an Opposition member the right to have figures incorporated in “ Hansard “ - a right which surely is in keeping with freedom of speech.

As I have said, by the horror Budget and the little horror Budget the Government diverted an increasing amount of nontransferable taxes to transferable taxes. In 1951-52, sales tax revenue amounted to £95,000,000, but by 1958-59 it had risen to £143,000,000. In 1951-52 pay-roll tax produced £37,000,000, but by 1958-59 revenue had risen to £49,000,000. In 1951-52 company tax yielded £150.000,000, but by 1958-59 this had risen to £219,000,000. Individual income tax, which is the only equitable tax because it is the only tax which cannot be passed on, yielded £386,000,000 in 1951-52, but this had increased to only £388,000,000 by 1958-59- a mere £2,000,000. However, whereas in 1951-52 the total tax revenue was £919,000,000, in 1958-59 it was £1,126,000,000. There is, of course, another tax which cannot be passed on. I refer to estate and gift duty which is paid on the estates of people who have themselves passed on. The figures that I have given show that although in a period of eight years there has been an increase of £200,000,000 in the total tax revenue, the revenue from individual income tax has increased by only £2,000,000. In the financial year 1951-52, 42 per cent, of the total tax revenue represented individual income tax, which is a direct tax. In 1958-59, the proportion was only 34.4 per cent. This Government talks about the efforts of the trade union movement to increase wages accentuating the cost spiral. But the real truth is that the cost spiral has been accentuated by the Government’s increasing reliance on indirect taxes. This Government has caused the inflationary upward trend.

I should now like to lead to the House the views expressed by Dr. H. C. Coombs, Governor of the Reserve Bank of Australia, in his address to the thirty-fourth congress of the Australian and New Zealand Association for the Advancement of Science, at Perth, on 26th August, 1959. He said -

Another important element in the pricing policy of industrialists and traders is their belief that selling prices should be sufficient to provide not merely cover for costs oi production, including a reasonable return on capital, but also a substantial part of the additional capital required for expansion. Undistributed profits after the payment of dividends at normal rates provides a very substantial part of the development funds of Australian companies.

Dr. Coombs went on to say

Also prices designed to provide such surpluses represent a kind of unofficial indirect tax imposed on consumers for the benefit of the industrialists and traders concerned . .

It is possible for prices to bc managed in this way partly because of the widespread semimonopolistic elements in contemporary productive and distributive organization and because general demand has been maintained for a number of years at high levels . . .

The truth is that monopolistic or semimonopolistic concerns have taken complete control of distribution in this country. When this Government increases or imposes an indirect tax, the effect is seen in the cost structure, because the additional cost is transferred to the consumer. This has been a great cause of the inflationary spiral. This Government and this Government alone is responsible for the inflationary trend as evidenced by the upward spiral of prices. Wages are just a minor factor.

In conclusion, Mr. Deputy Speaker, I should like to take the Prime Minister to task for the sneering remarks that he made last Thursday evening about the Australian Labour Party’s attitude towards foreign capital. Labour’s policy on foreign capital has been quite clear. Wc say - and we believe - that we need foreign capital only to the degree to which we cannot provide necessary capital equipment out of the returns from exports. It we cannot export sufficient goods to pay for the technical know-how that we need and to provide for necessary capital investment, then we need to import foreign capital. What does this Government do about exports? It has now embarked on its third experiment. Its experiment of 1951 and that of 1956 were failures. Its new gimmick is the relaxation of import restrictions in order to permit a great inflow of goods from overseas. What will happen as a result? The present trouble will be aggravated even more, and we shall have to pay out even more to foreign investors. As the honorable member for Fremantle (Mr. Beazley) demonstrated the other night, tor several years we have been balancing our imports by exports, or borrowing from overseas to make up the difference with a further flow of capital.

My time has nearly run out. If I had enough time, I could demonstrate beyond doubt that this Government is what I shall term a borrow-overseas-er-bust government. It has no policy. It is a hit-or-miss government. The policy that it adopted in 1951 failed as did that which it adopted in 1956. Its new policy of restricting wages also will fail miserably, as will its policy of opening the Australian market and flooding it with imports. I have worked for many years in the merchandizing and retail industries, and I know the kind of buying of overseas goods that will result from the Government’s latest gimmick. At present, one cannot get a seat on a plane to Japan because retailers are going there in droves, trying flat out to cash in on this gimmick policy of relaxing import restrictions.


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


.- Mr. Deputy Speaker, first, I should like to join with my colleagues who have already spoken in congratulating Her Majesty the Queen and the Duke of Edinburgh on the birth of a second son, and in extending best wishes to Princess Margaret. I join, also, in welcoming to this country His Excellency the Governor-General and Lady Dunrossil.

Before I proceed to the main part of my remarks, I should like to comment on several matters, first among them being some of the points made by the honorable member for Reid (Mr. Uren). He said, among other things, that this Government was spending too much money on defence, and that the money that we could save on defence should be used to help raise living standards and the rate of production in the countries to our near north. In this context, the honorable member mentioned the Colombo Plan, Sir. I, too, desire to assist the countries to the north of us which are our near neighbours; and I shall answer immediately the honorable member’s criticism concerning defence expenditure. I hope to say something about the assistance that we are giving to other countries under the Colombo Plan later if time permits. The fact is that the countries to the near north themselves want Australia to assist them greatly in maintaining their defence programmes. That is why Australian forces are stationed in Malaya as part of the British Commonwealth Far East Strategic Reserve and why some of our forces are co-operating with the Malayan Government in stamping out the Communist terrorists who still operate in Malaya.

We know very well, Sir, that the Australian Labour Party’s policy favours Australia’s withdrawal from the South-East Asia Treaty Organization and from other defence organizations and treaties in which we participate with the countries to our near north. The fact of the matter is that the sensible planning of Australia’s defence policy requires that we assist our neighbours and allies, in every way possible, to contain the enemy within his present bounds. We all are aware, Sir, that the threat to SouthEast Asian countries, including Australia, comes from only one source.

Sitting suspended from 12.43 to 2.15 p.m.


– I wish now to discuss the most difficult yet interesting problem of social services for a little while, Mr. Deputy Speaker. I think you will recall that during this debate many honorable members have addressed themselves to the problems of inflation and the extent to which that economic disease is present in Australia. Opposition members have told us on many occasions that they will announce a policy to deal with these problems, and we wait with interest to see what strong cure they have to offer. I might say that Labour’s present policy of advocating a 35-hour week, legalization of strikes and applications for constant pay rises are not in themselves a cure, although they might be worthy of consideration.

So fac as’ social services are concerned, there is little doubt that those who suffer most from economic ills and sudden rises in the. cost of living are those people who are on fixed, incomes. In this group, those who are the worst sufferers are civilian widows and single age and invalid pension:ers. I suggest that for the immediate relief of civilian widows, the Government might consider granting to them the domestic allowance which is now made available to war widows.

While 1 do not wish in any way to deprecate- the need of the single pensioner and the widower, 1 believe that the other group which is in need of assistance is formed by those people who, because of their own savings and the operation of the means test, are not in receipt of an age pension. In fact, in many cases, they receive less money income than some persons who are in receipt of a full pension. So while we realize that much has been done by this Government to remove many of the restrictions of the means test, and that it is not possible to abolish the means test completely in a short space of time, I think we realize also that anomalies will exist so long as there is a means test.

Another problem is presented by the person who is self employed or engaged in an industry which does not provide a superannuation fund. Wishing to provide for his maintenance during his years of retirement, such a person often invests his money during his working life in Commonwealth bonds, shares, property or some other form of investment. You will remember, Mr. Deputy Speaker, that some years ago the Government made it possible for a married pensioner who had contributed to a superannuation fund to receive an income of £7 a week without the rate of pension for himself and his wife being affected. It is obvious that under the operation of the means test at present, the person who invests his savings is unable to obtain an income of £7 a week because the asset value which provides that income penalizes his pension as soon as the value exceeds £200. Therefore, I suggest that the Government should direct its attention immediately, when next liberalizing the means test, to solving this problem.

While we realize the need to continue assistance to the age pensioners who, through no fault of their own, find themselves in difficult financial circumstances, we must pay regard to those who, through their own efforts and industry, have saved for their old age. Therefore, we find we are faced with one problem which has two distinct parts.

The first part is how far the economy can go in increasing the base rate of the various social service benefits which are provided under the Social Services Act, and the second is how far the economy can provide additional money to release gradually the restrictions imposed by the means test. Like many other members, I have taken the opportunity to attend numerous meetings of various organizations which consider these matters, sometimes speaking to them and sometimes answering their questions. Over the past two years in particular, the question has often arisen whether the Government would accept the principle of linking the base rate of the pension with the basic wage. When I have been asked that question, I have always said, “ No, I would not support it “. I have given that answer for what I believe to be some very good reasons.

In the first place, I assume that those who advocate linking the age pension with the basic wage realize that originally the basic wage was calculated on the needs of a family group, which I understand to be a husband, wife and two children. If the pension is to be linked with the basic wage, and the pension applies to an aged married couple, it seems obvious that the content of the basic wage which provides for two children would be subtracted in calculating the rate of pension.

I do not intend to cite many figures, but it is generally accepted that the minimum cost to a married couple of keeping two children is £3 a week. It is also generally accepted that the wage-earner of a family pays on an average £1 a week for fares. If we add to those two figures the extra expenditure of a family with children, we find that the age pension payable to a married couple is either just a little less or just a little more than the basic wage, according to the cost of living and the basic wage of a particular State.

The next point is that Commonwealth governments, irrespective of their political colour, have never accepted the principle that social security benefits should be linked with the basic wage. As you may remember, Mr. Deputy Speaker, the system of linking age and invalid pensions with the cost of living index was tried twice in Australia and was twice abandoned. On one occasion when it was in operation, the cost of living index fell and so also automatically did the rate of pension. There was such an outcry at that time that the system was abandoned and the former value of the pension was restored, I think from memory, on the next pay day. No government has accepted this practice in principle.

Finally, under the Labour regime when the former right honorable member for Hunter, Dr. Evatt, was deputy leader of the Australian Labour Party and AttorneyGeneral, he introduced a bill repealing cost of living provisions, and he made quite a number of interesting statements on the subject. I wish to read some of them to the House because I have noticed on past occasions, when members of the Opposition have had difficulty in finding an argument, they have quoted one of their former leaders, Mr. Chifley. Now that Dr. Evatt has left them, distance might lend enchantment to his views, so I shall remind honorable members of some of the statements made by their former leader when he introduced the bill to which I have referred. Dr. Evatt, as Attorney-General of the day, made these statements -

Any automatic system of pension adjustment was necessarily arbitrary.

It results in arbitrary turning points; e.g. a reduction of 1 per cent, in the index in September quarter of 1943 had led to a reduction of nearly 2 per cent, in the pension rate.

As the pension rate was uniform throughout Australia, the automatic adjustment based on variations in the price index led to anomalies. This was illustrated by the fact that the system had required a reduction of pension throughout Australia, whereas in some places (e.g. Hobart) the price index had actually risen.

The fall in the index in some States had been so slight that there would have been no pension reduction in those places if they had been on a scale of adjustment of their own index instead of on the average for the six capital cities.

Considerable administrative work and many complications had arisen from the system.

I just take those few quotations from the speech of the former Leader of the Opposition on that occasion to add to the examples that I have given to prove to you, Sir, and I hope to the House that any system which links the pension with the cost of living index or with the basic wage has the obvious objection that it bases the pension rate on the assumption, first, that the cost of living is uniform throughout Australia and. secondly, that the cost of living always will rise.

The next thing that I wish to say under this heading is that it is neither economical nor to the best advantage of the recipients that the solution to their problems should be found merely in increasing the base rate without making any provision for any other scheme. I shall give an example. With great credit and with great success, this Government has introduced and operated a medical and pharmaceutical scheme. It is far more to the benefit of the recipients to have the assistance of that scheme than for the Government to add a small sum to the pension rate and say, “ This is our contribution to your medical and pharmaceutical expenses “. A second example - one can go on giving them - is that the Government has introduced a very successful scheme for providing homes for aged persons, by subsidizing approved church and charitable organizations which devote themselves to this work. Once again, it has been found far more economical and of far greater advantage to the recipient for the Government to spend the money that it has spent in that way rather than to add another small sum to the base rate of the pension and say, “ This is our contribution to enable you to build your own home in which to live your retiring years “.

Mr Roberton:

– The Government has spent nearly £7,000,000.


– The Minister reminds me that the amount is nearly £7,000,000. In giving these reasons, I hope I am giving to the House some of the factors that have actuated the Government in forming its policy on these difficult problems of social services. If I may just interpose here for a moment while talking of benefits, there is one benefit that I should like the Minister to consider, and that is the funeral benefit. I have had quite a number of representations from various organizations which point out that the amount of this benefit has not been raised for a considerable time and that the cost of funerals has increased. It is thought that this is the appropriate time to raise this matter so that the Government may consider it when forming the next Budget.

There is no time for me to canvass all these problems relating to social services, but I indicated at the beginning of my remarks that 1 should like to make some answer to the comments of the honorable member for Reid on the operation of the Colombo Plan and the need to assist countries to our near north. I have taken the opportunity to speak on these matters before and I have used as an example some countries that I have had the advantage of visiting. On this occasion, I should like to use as an example the area that we generally term the Borneo Territories. Borneo is a large island that lies across a line drawn from Darwin to South-East Asia. A large part of Borneo is closer to Darwin than Canberra is. The island is divided into four parts - North Borneo, Brunei, Sarawak and Kalimantan, the last-named being the Indonesian part of Borneo. North Borneo and Sarawak are British-ruled, but are being educated for and helped towards selfgovernment. The State of Brunei is ruled by the Sultan of Brunei. His Ministers are responsible for internal matters, and the United Kingdom Government is responsible for defence and external relations. These three are known generally as the Borneo Territories.

In the Borneo Territories there exists much goodwill towards Australia and a great friendliness for Australians. This is no new thing. We have an increasing interest in Borneo’s development because of our geographic position and because. I believe, our future is becoming more closely linked to that of our neighbours. In addition, Australians were in Borneo before World War II.. and many are still there. For example, there are Australian associations in each of the main towns, and the Postmasters-General in both North Borneo and Sarawak are Australians. But the strongest post-war link is the well-remembered liberation of the Borneo Territories from Japanese domination by the 9th Australian Division. The liberation is commemorated in the flag of North Borneo, which incorporates the colour patch of the 9th Australian Division.

As the honorable member for Reid pointed out, Australia and these countries to our near north, including :the Borneo Territories, have been drawn closer together since the war by the operation of the Colombo Plan. Their young people have come here to study on their Colombo Plan scholarships. Our technicians have gone to these territories. I believe that, in a general way, the aim of the Colombo Plan is to help these countries, by this two-way flow, to become self-governing and to take their place with the free nations of the world, thus becoming our true partners. My view is that the main factor in Borneo’s future development is that it has large areas of fertile land and only a relatively small population. Thus, Borneo is an example of the general Asian problem which I believe is to put the undeveloped areas to much better use, rather than to find living space outside Asia for the overcrowded areas. I think we all realize, Sir, that there are many areas in Asia that are over-populated. There are also many areas in Asia which have a very small population and which are almost completely undeveloped. Therefore, the assistance that we can give under the Colombo Plan will go a long way to reaching the objective of which I speak, and that is to put these undeveloped areas to much better use and thus help to raise the standard of living in these countries.

Because of the development that is going on there and because there has recently been established a direct shipping service to Borneo from both the east and west coasts of Australia, the trade potential for Australia with Borneo has increased quite a lot during the last few years. I found that Australia has most of the market in frozen meats, flour, butter and dairy products, but most of the ham and bacon comes from Denmark. My inquiries showed that greater market opportunities for Australia exist in canned and preserved meats, .of which we have only a small trade at present, in heavy equipment such as tractors and road graders for the timber industry, agricultural tools and chemicals and many other goods which are at present being bought from other countries. Certainly, there is not the huge market in Borneo that there is in some of the other countries of Asia; but there is a good market and an excellent opportunity for -us to increase our share of it. And that is, very briefly, the answer I wish to give to the honorable member for Reid.

Finally, may I say that by moving the amendment to this motion for the adoption of the Address-in-Reply to His Excellency’s Speech, the Leader of the Opposition (Mr. Calwell) has virtually moved a motion of censure on the Government; but it is not a motion of censure which has been very energetically supported by members of his own party, because, as you will recall, Sir, yesterday our friends of the Opposition had difficulty in providing speakers to match speakers on this side of the House. This morning, my colleague, the honorable member for Bowman (Mr. McColm), had to take the place of a Labour speaker; and I understand that another of my colleagues, the honorable member for Stirling (Mr. Cash), is to follow me. Therefore, it seems that members of the Opposition are not energetically supporting their own leader. He was hoping to give the Opposition a new look; but it seems the new look has become a droop.


.- It is most unusual in debate for one Liberal Party member to follow another, particularly in a very important debate. The honorable member for Robertson (Mr. Dean) has mentioned this fact, but I emphasize it because I do not want listeners to the broadcast of these proceedings to imagine that I speak from the other side of the House. This inability of the Opposition to supply members to speak in support of the censure motion, which it has moved against the Government, indicates that honorable members opposite have no real argument to present to the people of Australia against the policy of the Government.

When I originally prepared my speech for this debate, my intention was to refer to the progress which this nation has made in the last ten years, and to speak of the prosperity that Australia now enjoys. I had planned to discuss the lifting of import controls and the necessity for all Australian manufacturers to re-examine their costs of production. The PostmasterGeneral’s Department I had singled out for its inability to ensure that the installation of telephone services kept pace with Australia’s rapid development, especially in my own State of Western Australia, where the rapidly growing suburb of Morley Park is a striking example of an area with a real telephone problem that needs immediate attention. On the other hand, I had intended to .praise the Government for its decision to examine the matter of the means test and general pensions separately from the preparation of the Budget.

During the preparation of my speech, Sir, my thoughts kept returning to one particular matter that 1 wish to bring before this House. My research into this particular subject has given me information of such a nature as to warrant my contribution to this debate being confined to that subject only - the treatment of cancer on a national basis. My speech will be brief, because by its brevity the facts will be made apparent and the need for some early action will be impressed upon every honorable member. All of us have had friends who died of cancer when they could have lived many more years of joyful life in this country. As I speak, Sir, I remember those who have .passed on, and for whom I feel we did not .do enough.

I speak in feeling for the many people in Australia who are cancer sufferers to-day, and for whom there .is much we can do. And I speak in the interests of the future welfare of every family in this country, -because statistics show that two .out of every three families will at some time in their lives know the menace of cancer. Cancer gives little or no warning; it touches every avenue of our society and has no respect for age. Cancer will kill the older man, like one of my closest friends, a Victorian doctor, or the younger man, like the young returned soldier in my electorate who was taken from his family at the age of 36 years. We all know how many of our fine young children have been stricken with cancer of the blood and of the bone marrow - leukaemia. In 1959, the National Radiation Advisory Committee considered the controversial issue of the possible role of small doses of ionizing radiation in the causation of leukaemia. It was concluded that a factor or factors other than ionizing radiation appeared to be the major contributors to the incidence of leukaemia in this country and throughout the world.

Following on that report, leukaemia has now been made a notifiable disease in Vic toria and Queensland, and similar action is now being taken in the Australian Capital Territory and in the Northern Territory;, and I hope the other States will follow suit.. It should be realized that the purpose of the; notification of leukaemia is quite different from the purpose of the notification of infectious diseases, and it is being done to obtain statistical information which will assist in the study of this particular type of cancer. The very fact that the National (Health and Medical Research Council has -endorsed the recommendation to make all types of leukaemia notifiable is a pointer to the -necessity to make all types of cancer notifiable to ‘the Commonwealth Department of Health.

In 1958, 250,000 people in the United States of America died of cancer. According to the medical statistics cancer will strike one .in every four Americans, and at the present rate two .of every three persons who .get cancer die and one is saved. In 1958, approximately 150,000 Americans were saved from dying of cancer. Another 75,000 cancer patients who might have been saved died in that year because diagnosis and treatment were left too late. More than 800,000 Americans now living have been .saved from cancer. More than 10,000 women with cancer, who would have died if so afflicted ten years ago, are now saved each year in the United States of America. Twenty-one thousand women who develop breast cancer each year lose their lives, yet more than 50 per cent, of these could be saved by earlier detection followed by prompt and proper surgery. At the present time, cancer kills more children between the ages of three and fifteen than any other disease. The figures I have quoted illustrate the ravages of this disease and prove how many lives could be -saved by early detection and early treatment. These figures are evidence that more urgent action -should be taken in Australia :if we are to stem the ever-increasing incidence of cancer in this country.

When we examine the statistics on the incidence of cancer in Australia we find that in 1921, 49 children under the age of fifteen died from cancer. In 1957, the deaths in the same age group - under fifteen - had risen to 221. The figures for the under 44 group show that in 1921, 634 ^persons died, and in 1957, .there were 1,245 deaths in that group. When we consider cancer in all age groups taken together we find that in 1921 there were 4,768 deaths, while in 1958 the figure had risen to 12,647. Surely these figures are a challenge to the conscience of every person in Australia. They show that every 40 minutes a man. woman or child in Australia dies of cancer. One may well ask what is being done in cancer research, and how are we tackling this problem in Australia to lighten the burden of living cancer sufferers. I have discussed this matter with the Minister for Health (Dr. Donald Cameron) and I find that in Australia a certain amount of valuable work is being done, but it is limited in comparison with research overseas, and particularly that carried out in the United States of America.

Library research informs me that in 1959 a sum in the vicinity of 200,000,000 dollars was expended in the cancer research programme in America and in the rendering of service to all types of cancer patients. The results of American research are readily available to the Australian medical field and the duplication of large research clinics here may not be warranted, although much can be done to assist the cancer patients, as I will shortly outline to this House. We cannot have too much information on the incidence of cancer in this country, particularly when most scientists agree that there are many causes of cancer just as they agree that there are many kinds of cancer. Some cancers are traceable to factors having to do with a person’s surroundings, habits or occupation. Occupational cancers have been found among workers exposed to certain chemical compounds - especially benzol, which has been in the news recently.

In considering the causes of cancer, we find that at present there is no single answer to the question, “ How does cancer originate? “ A variety of factors appear to be involved in the development of the disease. More than 500 carcinogens, or cancer-causing agents, are known to medical science. These include excessive irradiation and exposure to certain chemicals, and one wonders how our servicemen were affected by these factors during the war, in the various capacities in which they served, particularly when, in most cases of occupational cancer, there is a long latent period between exposure to the cancer-causing agents and the appearance of the cancer. Another interesting fact disclosed by research is that certain vitamin deficiencies can cause lesions which sometimes are potentially pre-cancerous.

There is no established evidence to support the suggestion that viruses are related to the development of cancer in man, and statistics have shown, further, that heredity has no bearing on the development of most types of cancer in man. Numerous as they are, the known and suspected causes of cancer do not account for all, or even the majority, of the cases of cancer that develop. Most people who are exposed to what are generally recognized as causes of cancer do not contract the disease. It seems, therefore, that there is a factor, at present unknown, which is at the core of the cancer problem, and which will be found only by continuous research and the recording of case statistics throughout the Commonwealth.

It is worth repeating that cancer is not hereditary, and that there is not on record anywhere a single instance of proven transfer of cancer from one person to another. I mention these two points, Mr. Deputy Speaker, to ease the minds of many families whose members worry about this - and the general public worries more about cancer than about any other disease - particularly when some female member of the family has had cancer, in which case the other members wonder whether it is a disease that can be transferred to another person. Many people ask whether cancer is hereditary or infectious. In both cases, the answer is “ No “.

Environmental cancer is the newest and one of the most ominous of the endproducts of our industrial environment. It could well be one of the main reasons for the ever-increasing rate of deaths from cancer. It should become one of the most urgent tasks of all medical men, labour and management leaders, public health officials and members of our parliaments, to become familiar with the problems of environmental cancer. We must all work together to combat this type of cancer at its very source, which can be found, perhaps, in radioactive substances used in medicine, science and industry and even by the defence services. The source may be found in the field of metallurgic research and development, or in the wide field of organic chemistry. Many new chemicals, without being pre-tested for cancerproducing properties, are- now being commonly used in industry, for instance in the manufacture of insecticides and synthetic fertilizers. Only last week, we had reports of illnesses and deaths in New South Wales caused by certain preparations of this nature.

Certain medicines, prepared foods and cosmetics, all designed for direct personal use and presenting possible cancer hazards, come under the heading, “ Sources of environmental cancer “. Environmental cancer is a reality. We must take action to eradicate it before the dread disease affects more and more of our people.

The national campaign against tuberculosis was a great step forward in our national health programme, but the time has come to take an even greater stride ahead and introduce, on the pattern of the Tuberculosis Act, legislation to assist people suffering from cancer. Now, surely, is the time to consider granting special allowances, subject to a reasonable means test, to all persons burdened with the disease of cancer.

Half the deaths that have been caused by cancer could have been prevented by early diagnosis and early treatment. Early diagnosis is so vitally important in cancer treatment that free cancer-detection examinations and medical check-ups must be the basis of a national cancer campaign. Employers must be asked to co-operate by permitting staffs time off for these examinations. Examination centres must be established at easily accessible places.

Cancer calls for a greater degree of personal care than any other disease. As a rule, the early signs are often indistinguishable from those of the unimportant complaints that we all have had from time to time, and which we have safely ignored. The ordinary citizen, therefore, literally holding his life in his hands, bears the largest share of responsibility for undergoing periodical examinations - no matter how well he feels - and lor deciding whether this or that minor complaint shall be ignored or whether the doctor should be asked for his opinion. 1 feel, Mr. Deputy Speaker, that the matter ot the provision of facilities for detection examinations must be considered by the Government if the present yearly total of deaths from cancer is to be reduced.

A medical diagnosis indicating the presence of cancer ha« a most distressing effect on the patient. What he thought could happen only to some one else has happened to him. In one moment his entire world is changed. He is struck with the fear of the uncertain. He feels that his life is in danger, and he fears not only for himself, but also for the future of his family. A person who has been given a positive cancer diagnosis must decide whether to tell his family and his friends, and what to tell his employer. When a positive diagnosis has been made, many domestic and financial problems follow, and in particular there is the question of mental and physical ability to continue in employment. These problems could be considerably eased by providing, free of charge, complete facilities for the examination, diagnosis and treatment of cancer in its many forms. The arguments in favour of such action are many: the main, and probably the only, argument against it would be the economic argument.

It is up to us all to ease the burden of cancer sufferers by tackling the problem with a “ national defence against cancer “ campaign. The desire to end the misery of cancer is paramount in the minds of all. It is the strong force behind the activities of a great many people. Scientists devote their lives to cancer research, while at the same time doctors labour unceasingly to relieve the burdens of human cancer. This great national problem warrants a greater effort by our Government. I feel that the strength of a nation is only as great as the strength, spiritual, mental and physical, of its people.

May I conclude, Sir, with this thought for every member of the Parliament and for every Australian: Economy at the expense of human life is an extravagance that Australia cannot afford.

Northern Territory

– Before discussing the AddressinReply, I would like to extend to Their Excellencies, the Governor-General and

Lady Dunrossil, on behalf of the people of the Northern Territory, a welcome to Australia. I wish to assure them also of a warm welcome in the Northern Territory when they eventually get around to visiting the more remote parts of Australia. I am sure they will see and appreciate many of the problems associated with living in that part of the world and with the development of that section of our country, and I am sure they will, as a result of their experiences, be able to assist that development and further, in some degree, the interests of the people of the Territory.

I wish to refer briefly to the fantastic statements made in this debate a short time ago by two members of the Liberal Party. They chided the members of the Opposition with being unable to provide as many speakers in this debate as are heard on the other side. This is quite fantastic, of course, when one realizes the numbers on the respective sides. It can be readily seen, however, that the Labour debating team in this debate at least, is far stronger than the team put forward by the Government to answer the charges implicit in the Opposition’s motion of no confidence. I understand that 46 Government supporters out of 76 are answering the charges levelled by the Opposition in this debate. That is not a very big percentage - a little over half. From the Labour Party, 49 members will speak out of a total of 56. Clearly there is little enthusiasm on the part of Government supporters to defend the attitude of the Government during the ten years it has been in office. I feel that those simple facts answer the absurd statements of the honorable member for Stirling (Mr. Cash) and the honorable member for Robertson (Mr. Dean). Of course, after the next election this position will rectify itself. The honorable member for Stirling will then have little interest, in the proceedings of this House.

I should like to draw the attention of the House to the fact that the constituency that I represent, the Northern Territory, is this year, 1960, commemorating the centenary of its exploration. It is just 100 years ago since John McDouall Stuart made his famous- exploration throughout the Northern Territory, and the residents of the Territory are marking this milestone in’ our history by celebrations. But the rejoicings will be tinged with some regret because after 100 years the Northern Territory is still the most backward part of Australia from the point of view of development. That is no cause for pleasure or complacency. The people who have held this outpost have done a remarkable job in holding it with very little assistance and encouragement.

It would be a very fitting gesture on- the part of the Government to recognize this fact in this year and say to the people of the Northern Territory, “You have done a very good job under the conditions that have existed over the past century, and we therefore feel that you are entitled to the rights of ordinary citizenship of Australia. You are entitled to be recognized as citizens in all the respects in which, people all over Australia, with the exception of those in the Australian Capital Territory are recognized!” F think it is about time that that gesture was made. It would be a fitting reward to people who under very difficult conditions have had to man the outposts of the north over this long period and who, by doing so, have afforded at least some measure of security to the rest of Australia.

If it were not for the sacrifices and the work of a small band of people in the north, the rest of Australia could not possibly feel as secure as it feels to-day. I remind Australia that if it continues to ignore this fact, serious trouble cannot long be delayed. In a troubled world to-day and in the critical atmosphere that exists to the north of us, the people of Australia must face up to the fact that they have to do considerably more than they have done in the past to develop the north of this continent; They have to face up to that fact before it is too late.

It is not just a matter of furthering the interests of the people of the north. It is a matter that concerns the. survival of the Australian people as a nation. It is up to them all to put pressure on their representatives in this Parliament to see that something is done before it is too late. Time is not- in our favour. Time is- against us in this regard. The population: growth that is taking place to the north of Australia and the demands that accrue as a result, both: for living space and materials, leaves no room for complacency. The outmoded theory that after we have developed the rest of Australia: we then can- turn around in a leisurely way and start the development of the north is a fallacy that is suicidal in every respect.

It is all very well to launch such huge developmental projects as the Snowy Mountains Scheme, but it is well, at the same time, to develop the north because every developmental scheme in the south creates a greater threat to our security than ever before. Side by side with development in the south should be development in the northern areas as a protection and a safeguard for all our projects. Of course, Mr. Deputy Speaker, there are certain basic requirements. You have to encourage people to go into the north. You have to provide them with opportunities when they get there, not only in the material sense, but by assuring them that when they leave southern parts their political rights will go with them; that they will not sacrifice their political rights or any of their citizenship rights When they take on the task of development in the Northern Territory. Of course, in the past, these rights have not been preserved to people who go to the Northern Territory. This will have to be done if we are to attract people and hold them to do the job of developing the north.

Let us review some of the things that have happened in that part of the world recently as a .direct result of government policy. Looking at the problem of citizenship rights .and greater .opportunities for selfdetermination, we find that as a result of legislation passed through this Parliament last year, a reconstituted Legislative Council has been brought into being. The expressed intention by the Minister for Territories (Mr. Hasluck) at the .time that he introduced his bill was to allow to the people of the Northern Territory a greater say in their own affairs and a greater degree of self-determination. With that end in view, the Legislative Council was reconstituted. But instead of allowing a majority of elected members of the council, the Government set up a body which consists partly of elected members, partly of official nominated members and partly of non-official nominated members. The three nominated non-official members of the council will hold the (balance .of power. They will give a majority to one side or the .other, depending on which way they -exercise their votes and on which side they exercise their influence in the deliberations on measures that come before the council.

We are told that the appointment of these three persons was necessary to discharge the Government’s responsibility to the taxpayers of the Commonwealth who provide certain funds for the development of the Territory, to ensure a wider representation on the council of the interests of the Northern Territory, and also to ensure that the alleged lack of experience in conducting the internal affairs of the Territory was not overlooked. It was said that the proposals would give a greater degree of political stability as well as other stabilities along the lines that I have mentioned. We find now that these members have been named. Their names were recently announced. One is an employee of a company with big mining interests in the Northern Territory; the appointment of another was made from outside the Territory, and the third nominee is a local Territorian. He is the only one of the three who has his roots in the Territory. I -shall try to review their background. They will exercise the balance of power in the Legislative Council, and let me emphasize the fact that rather than protect the interests of the people in the Territory we cannot help feeling that their appointments have been made with a view to protecting certain big business interests there which would be affected if relevant legislation in the Territory were altered.

One gentleman is employed as the representative of Consolidated Zinc Proprietary Limited, and he also manages Territory Enterprises Limited which is the managing body for the Government enterprise at Rum Jungle. He has no interest in the Territory beyond this employment and as a representative of those interests. We know that Consolidated Zinc holds mining interests and leases, and owns leases adjacent to Rum Jungle. If it comes to a .question of the interests of the people being in conflict with those of Consolidated Zinc, ;it is only natural to assume that by virtue of the tie-up and employment of this person he will protect the interests of his employers. I know the gentlemen concerned personally. They are excellent men with high reputations, and the criticism :I make is not directed against them but against -the principle involved in these appointments. Men of the same calibre and of similar ability could easily have been elected by the people of the Northern Territory had such persons been willing to stand and win the confidence of the people. It could happen eventually that Consolidated Zinc will take over the Rum Jungle uranium treatment plant, and when the uranium ore cuts out and the plant closes down Consolidated Zinc will work its own mining interests on the adjoining leases. Here again a conflict could arise between the interests of the company which this man represents and those of the people. It is an invidious position for the honorable gentleman to be in; his appointment is wrong in principle.

I turn next to the gentleman who is the professed nominee of the North Australian Pastoral Lessees’ Association, which represents holders of large pastoral leases in the Northern Territory. This man runs his activities from Sydney, or at least from the eastern States. He is the direct nominee of this association. From time immemorial big pastoral interests have always had conflicts with governments as to their rights against those of the community. This gentleman at some time or other will have to decide whether his interests lie with the persons who are responsible for his appointment or with the people of the Northern Territory. If he comes down on the side of the interests of the Northern Territory then he will immediately cease to be the nominee of the North Australian Pastoral Lessees’ Association, and his nomination by that body will be withdrawn.

I have no criticism of the third appointee, who is a local resident. His is a good appointment. He has wide experience in his own field and can make valuable contributions to the deliberations of the Legislative Council. But again I emphasize that his appointment, as well as that of the other two persons to whom I have referred, was wrong in principle. Not one of these three gentlemen could not have been replaced by suitable persons in the Northern Territory who would have been responsible to the people and not to outside interests. But as I have pointed out, two of these three nominees are representatives of business concerns with vested interests in the Territory and are in honour bound to protect those interests. What is needed is people who will work solely in the interests of the Northern Territory and its development. I emphasize again that I have no personal complaint about these nominees. They are very competent and are held in high regard. But there must come a time when the interests of those who have nominated them must conflict with those of the people. I make that protest and warn the Government that this is an obstacle which will have to be recognized and removed before the population in the Territory will be contented and do their best to work for its development.

The question arises: What development is actually taking place in the Northern Territory? What record of achievement can this Government show after being in office for eleven years? If we face the facts squarely, we cannot deny that the Government has done very little. The only development project has been ricegrowing at Humpty Doo. The Government, after its initial experiment, handed over that enterprise, lock, stock and barrel, to a private concern. The bulk of the capital and consequently of the control was American, and the mess that was made of this project had to be seen to be believed. Subsequently another organization took over; and there is now some semblance of efficiency and progress in development. A grant of 500,000 acres was made to the first company. A statement by a representative of the company which now controls the project shows that over the last two years £800,000 of company finance has been invested in it. This year 5,500 acres were sown to rice. It is estimated that after milling the crop the return will be in the vicinity of £330,000. That is not a bad return after two years on an investment of £800,000. If that return can be obtained yearly from 5,500 acres of rice, what sort of a rake-off could be obtained from 500,000 acres if it were all in production?

Of course, the company has no intention of fully developing that 500,000 acres of rice land. What has been done already demonstrates the fact that rice can be grown in this area. Certain basic development will be done on the remainder and then the whole lot will be sold on a real estate basis. It is a wonder to me that

  1. J. Hooker has not heard of this. If he did, Sir Arthur Fadden would be up there in very quick time. A return of £300,000 from a 5,500-acre crop has never happened before. It is certainly a handsome, return on the £800,000 which has been invested in the project.
Mr Mackinnon:

– What expenses have been involved?


– The representative of the company says that £800,000 has been expended over the last two years.

Mr Mackinnon:

– That is capital; I mean working and administrative expenses.


– A return of £330,000 from a 5,500-acre crop represents a very attractive investment.

Mr Anderson:

– How do you know what the costs are?


– The representative of the company has told us what they are. We know the cost already, because the representative of this company has told us. When the area is cut up, instead of Australians acquiring land at reasonable prices, as they could under a Commonwealthdeveloped scheme, they will now have to pay prices based on the fact that loaded on to the cost of the project will be not only the money that was thrown down the drain by the company in the first place a few years ago, but also the profits that will be taken by the company in its developmental efforts. I would say that those who are going to get the major benefit out of this are the American interests. The interests of the Northern Territory will come second. So much so, that the people who are at present exploiting the rice fields have deemed fit to transfer their milling activities from the Northern Territory to Hong Kong. It is obvious that they are shifting their milling activities to that Crown colony because labour is cheaper there than it is in the Northern Territory. The result of the move will be that people in the Northern Territory will be deprived of employment opportunities which they would otherwise have, and those opportunities will be available to coolie labour in Hong Kong.

It is only logical to expect that the benefits that accrue from a national resource in the Northern Territory, or at least part of them, should be ploughed back into the development of the Northern Territory for the benefit of its people.


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


.- I think that the election of the honorable member for Melbourne (Mr. Calwell) and the honorable member lor Werriwa (Mr. Whitlam) to the positions of Leader and Deputy Leader, respectively, of the Opposition was welcomed by this side of the House. They are both popular members of the Opposition, and there is no reason why, although we differ in politics, we should not be friendly. It is a great pity that they reached their zenith when we were approaching the Ides of March, because, if history repeats itself, they will not he there long. I should like to feel that we will be getting a better Opposition now, because the Opposition is an important force under our parliamentary system. Alas, I am sorry to say that the speeches that have come from the Opposition in this debate have given no indication of such change.

I should like to recommend my friend from Melbourne - he is a friend - to take speeches like that made here yesterday by the honorable member tor Kingston (Mr. Galvin), read them quietly over with the honorable members who make them, and tell those honorable members that that is not the sort of stuff that the Leader of the Opposition wants to come from the Labour Party under his leadership. Like others here, I have had some experience in leadership, and leadership requires training. So do people who make loose statements. The honorable member for Kingston and the honorable members for Yarra (Mr. Cairns) and West Sydney (Mr. Minogue) have expressed views that are not in keeping with facts. One says that we have no prosperity, another admits that we have. This is the kind of double-talk we get from the Labour Party. We hear honorable members opposite talk about the poor down-trodden workers, yet at the last general election in New South Wales the Labour Premier, Mr. J. J. Cahill, who has since died, said in an election speech that New South Wales was in a magnificent condition. New South Wales is part of the

Commonwealth, yet we have double-talk in this national assembly, one member of the Opposition’ denying’ that prosperity exists, another admitting that it does exist, but finding fault with. it. In this. Parliament we have tales of woe about the state of. the country, and from the State parliaments we hear tales about prosperity.

We on this side are often chipped with being the friends of big business. More double-talk! If by “ big. business “ our critics mean the manufacturers, let me remind them that we have lifted import restrictions, thus admitting the cold breeze of competition for the manufacturers. Is that the act of a friend? If by “ big business “ they mean the importers, did we not inflict import restrictions on the Importers? Is that the act of a friend? Or perhaps by “ big business “ they mean the banks. Oh yes, of course, the banks! The ultimate in big business! Just study the enormous growth and progress of the Commonwealth Bank under this Government. Look at the number of branches that have been opened,, and the tremendous progress that has been made. Is that the- act of a friend in support of the private banks? So I ask honorable members to try to bring into this national Parliament something more of real opposition than just this double-talk.

Then we have the. question of wage cuts. Our critics charge us with being a. low-wage party. The Australian Country Party was charged with that yesterday. Do employers make profits out of empty pockets? Of course not! Surely good wages, must be paid in order to create purchasing power.

So, instead of all the double-talk we have been having from members of the Opposition, T should like to hear a little more straightforward talking. Honorable members opposite admit that they do not like foreign capital. But Mr. Cahill searched the whole of Europe and America in an effort to attract foreign capital.

Mr Uren:

– Of course he did, because he could not get the money for the. Federal Government.


-“ Of course he did “, says the honorable member. But the Labour Party here does not want foreign capital coming into the country. They talk about land speculation. They do not like that either. Why is the Labour Lord Mayor of Sydney, Alderman Jensen,, making an overseas; trip? Is. not’ he. land-sharking- for foreign’ capital?

Right throughout the; Labour Party there is this constant double talk. I. have never heard in this national assembly a more bitter attack on Australian people than has emanated- from the Opposition in this debate. Honorable members opposite have been constantly attacking the business people of Australia, the people who provide the sinews of employment. Those honorable members should read their speeches again, and realize the kind of thing they have, been saying about Australian business people. According to them, every businessman in Australia is a profiteer, a shark, a racketeer, an exploiter of the public. These terms could have been right 50 years ago. Are they correct now? The honorable member for Yarra produced some figures concerning profits. Where he got them I do not know, but the Commonwealth Bank’s statistical bulletin of April gives details of the profits of 730 different groups of companies^ - mining, manufacturing, wholesale, retail, transport, power, banks and so on. From 1955 to 1958, the percentages of profit were 9.9, 9.1, 8.7 and 8.5. There is no sign there of great profiteering, and those are the figures given by the statistical branch of the Commonwealth Bank. Admittedly, some people make higher rates of profit, but you cannot expect people to invest money without getting something in return.

We also hear from the Opposition continual talk about monopolies and trade restrictions. These things exist in any society. I have asked several times for a royal commission on monopolies, not so much to disclose the fact that they exist, as to provide the opportunity to educate the people so that they wilt understand something of the workings of the capitalist system. Of course there are monopolies. But the word “ monopoly “ is used by honorable members opposite not in the dictionary meaning, but to mislead the ignorant. Does the existence of monopolies mean that the whole system is wrong? We have ballot-rigging and tyranny in the trade unions of this free country, Australia. Look at the American exposures of trade union racketeering also. Does that mean that trade unionism is bad? Of course it- does not! We cannot work in the modern world without trade unionism. So, because, the- capitalist system has its faults, that, does not mean that, the. system itself is bad and. has to be changed, completely.

Every Labour member of Parliament who makes a trip overseas looks round, beats his breast, and says,. ““We are much better off than this in Australia”.. Yet here in this national assembly they belittle things Australian, they decry Australian institutions and attack, their own people, and try to destroy the Australian way of life. I am concerned about the continual’ attacks which are. being made on our way of life. The honorable, member for Werriwa has said that we have a. doctrinaire approach to various matters. I think that, it goes deeper than that. The honorable members of the Opposition directed, a bitter attack at the business people of Australia. If you read Keynes’s book on the possible effects of inflation and deflation, you will see that when there is rapid inflation the public, the proletariat, the bourgeois, attack the profiteer. Such a condition has not yet arisen in Australia, and there is no need for the epithets which have been hurled at the present system.

The honorable, member for Yarra said that he would like to impose heavy taxes on the money which is in the hands of the few. He is a disciple of Lenin’s- system, and- believes what he said. However, money has been distributed widely in Australia. Curiously enough, the United’ Kingdom Government has been very successful in controlling inflation. Mr. Heathcoat-Amory, the Chancellor- of the Exchequer, has said -

The Government are playing a positive part; we- are not* just cheering from the sidelines. Over the past two years we- have reduced rates of taxation: by about £400,008,000” or say 7- per cent. This has given- a lead which some manufacturers and retail distributors have already followed.

The United Kingdom Government reduced taxes: and was successful in controlling in* nation. But the honorable member- for Yarra wants to increase taxes! He recommends wild spending. Does he want to bring us to ruin so that Keynes will be right in. his- warning?

What means of dealing with inflation have been offered by the Labour Party? Only direct controls! Unlike the Government, the Labour Party cannot use the im personal approach. We have heard: the honorable member for Yarra and the honorable member for Reid (Mr. Uren) demanding direct income tax. When the next Budget is introduced every member of the socialist party will demand, as it does- on the introduction of every Budget, a reduc-tion of- sales tax because of its unfair application. Let us look at the greatest experiment in socialism that has ever been undertaken. I- refer to the Soviet Union: For- over- 40 years the people in charge, who limited their opposition by murder, pursued a- policy of “ socialism,”. But Khrushchev has now abolished income taxes and has imposed only sales tax. Honorable members opposite have, told us that socialism does not favour indirect taxes. How does that statement line up with what Khrushchev, has done in replacing income tax with sales tax so that the poor will become poorer and the rich will become richer?

The causes of inflation are many and varied, and many counter-measures must be attempted because inflation and deflation are so closely associated. We have heard about rising prices in Australia as compared with prices- in other countries, but Australian, conditions- are quite different from those obtaining elsewhere. Let me mention some of the different conditions. Our expansion has been tremendous, much more so. than that, of any other country-. That is inflationary. Immigration at its present level, having regard, to our population, is highly inflationary. The 40-hour week - dot not think, that? I oppose it- was. introduced in. Australia, long, before it came into operation in those countries which have been, compared with Australia in relation to the inflationary trend. That makes quite a difference.

Then there is full employment. No other country iti the world- has such a highly satisfactory employment position. Only last night the honorable member for Blaxland (Mr. E. James Harrison) said that train crews are being lost to the Victorian railway service because they can receive higher wages from private enterprise. However; I do not believe that statement entirely. To me, it is surprising that a good trade unionist would move from one employment to another for profit. What happens? The railways department finds that it cannot obtain labour because there is a search by employees for higher wages. So it offers higher wages to retain its staff, and costs rise. That is one of the effects of full employment. We have in Australia the highest rate of trade unionism of any country. In the United Kingdom trade unionists comprise 40 per cent, of the work force, in Canada 24 per cent., in the United States of America 24.8 per cent., while in Australia 59 per cent, of the work force. That also is inflationary, and represents some of the burden which we are carrying. I believe in trade unionism, but with a very high rate of trade unionism in a period of full employment certain problems arise. In Newcastle employees of the omnibus section of the Department of Government Transport went on strike recently in an attempt to force the department to provide more work for light duty men. The users of the buses must pay for the charity which is extended to those employees. Strikes which directly affect costs are inflationary.

Political unionism is a very ugly thing, and trade unionists should be wary of it. No country in the civilized world has a higher proportion of Communist leadership in trade unions than we have, but the people who are responsible for this are the trade unionists themselves who elect to office these renegades and traitors to Australia.

Hire purchase has been stated as being inflationary. We often have the high interest rates of hire purchase thrown at us. I understand that hire-purchase interest rates in Australia are the lowest in the world. Although we pay a high interest rate, in hire-purchase systems this is offset by the fact that manufacturers are able to cut their costs as a result of the volume of demand. Hire purchase is rapidly raising the standard of living in Japan. I, personally, do not favour hire purchase, but for many people who are unable to save, it is a form of saving because they are able to buy durable goods. That is saving. The States have the machinery to control hire-purchase interest if they wish to use it. The State Premiers and Treasurers confer with the representatives of the Commonwealth Government at regular intervals. Let them take five minutes off from their other duties and remedy all the troubles that now exist!

Mr Reynolds:

– They have tried to, but have never been able to reach agreement.


– Why have they not been able to reach agreement? Because the Labour representatives will not agree with the Liberal representatives! However, there should be no difficulty in coming to an agreement. If the Commonwealth were to take action of its own volition, it would be challenged. If it is true that the States have the machinery to handle the situation, why charge the Commonwealth Government with the responsibility for controlling hire purchase? The Government has taken positive steps to deal with inflation, despite the fact that the Opposition says that it has not. The Government has imposed import restrictions, tightened the availability of money, proposed balanced Budgets and has now decided to put a case to the Arbitration Commission against an increase in the basic wage.

We must recognize that the Government has the task of holding the scales equally as between the forces of management and labour. I have shown that the Government has been tough with management, but never with labour. Management only puts a case to the Government to show that the economy is in danger. If it did less than that, it would be recreant to its duty.

The Government’s proposals to deal with inflation are very wise. I should like to refer now to the suggestion that pay-roll tax be abolished. We have often heard it said that taxes should be abolished. How can that be done? Let us consider the payroll tax, which provides revenue of the order of £50,000,000 a year. The State governments and local government authorities pay £12,000,000, and, according to the reply which the Treasurer (Mr. Harold Holt) gave to a question I asked of him a day of so ago, that amount is refunded to them. The 5 per cent, rebate on income tax last year amounted to £22,000,000, but incomes are higher this year, so let us assume that the rebate will be £25,000,000. That leaves only £13,000,000 to find to abolish pay-roll tax altogether. Where can we find it? The Commonwealth works programme this year is estimated to cost £144,000,000. Pay-roll tax is payable on materials and wages. So, of the estimated cost of the works programme, £5,000^000 represents pay-roll tax which, in effect, is going into one pocket and coming out of the other. Pay-roll tax is incurred also in respect of expenditure by the States on public works, which amounts to some £200,000,000. There is another feature that would help to enable us to get rid of the pay-roll tax. Banks and insurance companies, and others, cannot pass this tax on, but, if they did not have to pay it, the banks would pay more in company tax, and their individual shareholders would pay higher taxes on their dividends. So, I say that the removal of the pay-roll tax is possible.

What would be the effect of removing this tax? In 1956, the Tariff Board stated that every £1 of pay-roll tax collected represented an addition to costs of more than £2. So that the lifting of the pay-roll tax would immediately reduce our costs by more than £100,000,000 a year, and this cost reduction would do much to counteract the effects of recent pay increases.

It is true that the pay-roll tax hits all sections of the community and every stratum of society, including pensioners and housewives, but it hits the farmer, a producer, particularly hard because he cannot pass it on. I make a special plea on his behalf because, at the present time, farming is the only activity which lacks the prosperity that we see in so many other fields. Since 1950, gross farm income has attained a level of between £1,100,000,000 and £1,200,000,000 a year, and costs have risen from £414,000,000 to £760,000,000 a year - an extremely formidable increase in costs. Something must be done to help the farmer. Among the measures that I suggest is the adoption of a new method of financing rural activity. The present method is wrong. Joint-stock banks are not the proper source of finance for farming, which requires funds over long terms at low interest. I suggest that the Government ought to consider whether all private banks should have development bank subsidiaries, just as the Commonwealth Banking Corporation conducts what is known as the Commonwealth Development Bank. These development banks could be financed out of the deposits in their savings banks. They could earn a little better interest than the savings banks get now. This method of financing rural production would take farm finance entirely out of the joint-stock bank system.

The Government has at its hand a very powerful and effective weapon which it can use against the constant growth of inflation - the discount rate. We all remember how the raising of the discount rate in the United Kingdom to 8 per cent, quickly eased inflation and reduced its pressure. I think that the Government should examine the advisability of adopting measures of this kind.

I should like to say, before I conclude - my time is getting short - that I am very much concerned about the great conflict of ideologies in the world to-day. We see it in our own country. The Australian Labour Party directly assails and tries to weaken the capitalist system - the only system devised by man under which he may remain free. If this system has faults and blemishes, they could be removed, but Opposition members propose, instead of the reforming of this system, the substitution of a completely foreign ideology.

Mr Duthie:

– A Christian ideology.


– It is most unchristian, because the socialist replaces the Almighty - the State replaces the Almighty. Look at what has happened in England. The coal industry in Australia is flourishing now, but the United Kingdom coal industry is going downhill rapidly and incurring great losses because it has been nationalized, and the whole burden has been thrown on the taxpayer. Look at the railway system in England. Once it was a fine private system. To-day, its losses are as much as £130,000,000 a year, and the employees engaged in it have great grievances in respect of bad pay and poor working conditions. That is what happens when the socalists get in. By contrast, what is the situation in the United States of America? Although there is much competition between road transport and the railways in that country, the American railway systems are paying well, because they are privately operated. The whole socialist system is wrong.

At the present time, there is a tremendous cleavage in the British Labour Party between the pro-socialist and the anti-socialist sections. We see the same differences arising in the Australian Labour Party. I do not think that the honorable member for Darling (Mr. Clark), who is a reasonable sort of man, is a socialist. Not all these men who sit on the Opposition benches in this chamber are socialists, although there is .a hard core -of socialists behind the .Australian .Labour .Party. The socialist system will not work. The party which represents the alternative government is doing all it can .to destroy the one system -that enables men .to remain free.

I close by extending my good wishes to the .Leader of the Opposition. I strongly recommend him to try .to strengthen the arguments of his colleagues by sticking to the facts and getting away from these old slogans and .out-worn cliches that they use so .-much. In wishing >the honorable member well, I should like to remind him that we .can learn .a lot -from the past, and that a Roman poet named .Plautus, who lived in the third .century B.C said that “to fly without leathers .is .not easy “.


Mr. Deputy Speaker, the ‘House has become accustomed .to hearing the honorable member for Hume (Mr. Anderson) deliver his regular tirades against the Australian Labour Party and the workers of this country. We -have ‘become so accustomed to it that his words >now fall on deaf ears in -this -place, although -there are in the community people who, not knowing the honorable -member as well as we -who belong -here do, -would be inclined ‘to accept some of his -remarks as being true and to believe him when he says that the Australian Country Party is not a low-wage :party, is not opposed -to trade unionism and -favours the payment of decent wages. But. <f we look at the history of the Australian Country ‘Party, we find that all the honorable member’s statements on that matter are untrue. We have only to look back to the basic wage inquiry of 1959 to find that the judges of the Commonwealth Conciliation and Arbitration Commission had :to decide, on the submission of the pastoral interests, whether or not the wage ;fixed .under the pastoral award of 1956 should be reduced by 25s. a week. The ^honorable member says that the Country Party is not a low.wage party, although, , no more -than nine months ago, counsel for .the interests :that it represents submitted that the : basic -wage -in :the -pastoral industry should be reduced by 25s. a week. Admittedly, the pastoral interests have not gone to ;the commission in the current basic wage inquiry. This is because their submission in 1959 was rejected unanimously.

The pastoral interests have now made a complete about-face. Mr. -G. B. S. Falkiner, who is president of the New South Wales Sheepbreeder-s Association and of the Australian Association of Stud Merino Breeders, .and who is perhaps one of the best known Country .Party representatives and supporters in Australia, in a statement made on 1st March, said, in part -

To see the position clearly, it is, however, necessary to bear in mind that wages paid to station and ‘farm employees are quite a small item in the .cost of running -.a property to-day. Sixty to .eighty per .cent of operating costs are completely put of .the .growers’ hands, as they consist of such items as freight and increased prices for fencing and building materials, agricultural machinery, stock medicines and other general -supplies, .and -steep -rises in repair bills (governed by .tradesmen’s .wages) ,and shire and other rates.

But that did not stop the pastoralists from intervening in the -basic wage ‘hearing in 1-959 and trying to have the wages of pastoral workers reduced by 25s. a week. The statement by the honorable member ;for Hume that the Australian Country Party is not a low-wage party, that it favours trade unions and that it ‘is generally appreciative >of the efforts of the workers in Australia is completely untrue. The actions of the Country Party and of the honorable member in the past show clearly that he talks with one voice in this House but acts in an entirely different manner .outside it.

In this debate, many -statements have been made about the alleged old-fashioned thinking of the Australian Labour Party anc! about the need for Labour to bring its thinking up to date and to realize that prosperity abounds in Australia to-day. No member of the Australian Labour -Party has suggested that Australia does not at present enjoy a measure of prosperity or that conditions have not been improved down the years. However, the improvement in conditions has occurred only because of the existence of the Labour ‘Party and the unions. We have only to go ‘back -to -the -beginning of this nation to -find that already at that stage, the -master-slave basis .existed between employers and -employees. The employee was -expected 40 work long hours for small wages without amenities and awards. He had no security of employment; he was intimated and victimized, and the strikes :of the .early 1890!s by shearers, .maritime workers and .others were all the .result of :the actions of employers .and management -against -employees. In each -of those strikes the .employees -.were overwhelmingly .defeated because the workers had no strength. The unions were as ropes of sand. There was mo cooperation, no -solidarity and no body :of opinion prepared to voice -the case on behalf of ;the (employees.

Then we -had the birth of the -trade unions and the Australian Labour Party. There was lack of interest in ‘the affairs of industry by the legislature, and the unions, as they existed -then, were no <match for the power of the employers .and the press. Then gradually there were demands for industrial issues to be decided by -reason and not by power, and by governments rather than by the employers. ‘Out of that agitation we had the rise of the industrial tribunals,. conciliation and arbitration courts, and to-day throughout th.e Commonwealth that system is operating. Generally, it has worked satisfactorily. Relations between government, employer and employee have improved.

In -the second world war there was an -indication .of the measure of .good relations that can be fostered between governments, employers and employees when wages were pegged and there were no new awards. Yet there are honorable members who come into this House and say that the Labour Party and the .employees are not prepared to co-operate with managements and the Government to develop .this nation. Such charges ate unjust and untrue.

Admittedly, there are industrial disputes sometimes, but generally they are caused by lack of trust between labour and management. The history of labour and management throughout the years gives every reason for labour to be suspicious of -the actions of some governments and sections of management. To-day, we have the further problem of increased mechanization and -the -introduction to industry of automation. They pose new problems for governments, managements and unions.

In regard to all these things, the Australian Labour Party stands as a watch dog alongside the .unions >to speak for -the men ;and women in industry and commerce throughout the nation. Unless the Labour Party is .’here to safeguard the interests of the employees, those interests will be allowed to stagnate and the workers will lose ground. This Government .has been in power .for ten years, .and during that time hardly .one item .of legislation placed on the statute-book has been of direct benefit to the workers. The Government has not taken action to solve many of the social problems which confront the nation.

It .is only necessary to look at the com- that .have been established by this Government ,to realize .that the Government’s interests are not those of the ordinary -man and woman; its interests lie with the companies, the cartels and the monopolies. -Since 1949, when this :Government came into office, 25 .committees :have been set up :by this Government consisting of persons from outside the Parliament. All but two or three of them have been set up in the interests of employer organizations or companies. -Some of them are the Patents Law , Review ‘.Committee, the Trade Marks Law Review ‘Committee, the Bankruptcy Law (Review ‘Committee, the -Copyright Law -Review ‘Committee, the ‘Committee of Inquiry into :the ‘Stevedoring Industry, a committee to inquire into the turn-around of ships .in Australian ports, a committee to report on the prospects of agriculture in the Northern Territory, the Decimal Currency Committee, .a committee .to inquire into public service recruitment and a committee which inquired into Australian universities. These are some of them.

Mr Jan Allan:

– Their appointment is a tribute to the Government.


– Certainly, it is a tribute to the Government that it has seen fit to set up these committees and endeavour to get the best information from persons who understand the problems involved; but when you read this list of 25 committees, you will not find one committee to inquire into social service payments, child endowment, housing or education generally. All those things vitally affect the ordinary men and women of Australia, but not one of them has been mentioned. The Government relies entirely, in dealing with those matters, on the advice it can receive from its own members of Parliament, employer organizations and the Public Service, but on matters that affect companies, it is always prepared to set up committees of outside persons to hold an inquiry.

Until this Government is prepared to do something in the interests of the ordinary men and women of Australia, there will always be voices raised on this side of the House in opposition to it. My hope is that the time will come when, instead of being sectional in its interests, this Government might make some decision for the workers and set up committees to consider vital problems affecting ordinary men and women, but until that time comes, we, as an Opposition, can only advocate action.

One committee set up by the Government inquired into Australian universities. It was a laudable committee, and it has achieved some benefits for Australian universities, but, on the other hand, there has been no committee of inquiry into primary, secondary and technical education, although in all States education services are in a chaotic condition because there is not enough money to provide adequate school accommodation and proper amenities. If the Government is prepared to have a committee to inquire into the universities - the top level of education - surely it should be prepared to have a committee of inquiry to investigate secondary, primary and technical education.

Throughout the years that this Government has been in office, whenever any improvements have been granted in the conditions of workers, whether by increases in annual leave, long service leave or the basic wage, honorable members on the Government side have come forth with the cry of danger to the economy and the danger of inflation, but we do not hear much about it when company profits increase, or when the woolgrowers and the woolsellers get such big returns from their products.

Mr Anthony:

– A loading of £1 was placed on the basic wage.


– I remind the honorable member that, in 1959, the Australian Country Party set up a committee, and it tried to have the pastoral award reduced by 25s. a week. Its claims were rejected by the arbitration tribunal. If honorable members of the Opposition side criticize industrial conditions, supporters of the Government say they do not believe it, but it is all right, apparently, for the honorable member for Wentworth (Mr. Bury) to say that decisions are not based on facts. The honorable member for Richmond has said that a loading of £1 was placed on the basic wage, but the Australian Country Party, and its representatives, endeavoured to have that £1, and more, removed. If supporters of the Government are not going to allow representatives of the unions and Labour Party to criticize the Arbitration Commission when its decisions are not in their interests, they should not have the right to criticize the Arbitration Commission, nor any other industrial tribunal, when the decisions are not in accord with their line of thought. The “Hansard” report shows that, only the other day, the honorable member for Wentworth said, by way of interjection, that poor reasons had been advanced by the Arbitration Commission for the last basic wage increase.

The other action that the Government has decided to take in order to curb inflation is to lift import restrictions. Whilst there is some chance that the increased competition and the lowering of costs will effect some improvement in our economy, there is also the chance, on the other hand, that the advantage of bringing goods into the country at a cheaper rate will not be passed on to the consumer. Australian industries may find that they are unable to compete with the overseas products and will be forced to close down and to put employees out of work. Even whilst imports have been restricted, we have had many instances of retailers making profits of 100 per cent, and more on the products that they have brought into the country.

Up to this point, no attempt has been made by retailers to pass on to the consumers the advantage gained by bringing into the country goods at a lower cost than those produced here. If this has not happened up to this stage, there is no guarantee and no reason to expect that the retailers will give this advantage to the consumers in the future. Many items have been brought here and sold at prices as much as £1 or £2 lower than the price of the equivalent

Australian product, but even then the retailer has been able to make a profit of 100 per cent, or more on the sale of the article. Now that the restrictions on imports are being removed, every retailer will be able to obtain goods from overseas. Price agreements will be reached by various enterprises so that the retail price of goods will be fixed. This will enable retailers to make profits far in excess of a reasonable amount and little advantage will be gained by the consumers.

The Government has also decided to intervene in the basic wage inquiry which is now being held in Melbourne to decide whether quarterly adjustments should be restored and whether the basic wage should be increased. The claims of the unions are that quarterly adjustments should be restored and that 22s. should be added to the basic wage. The employers and the Government have combined to defeat the case. In 1953, when the Arbitration Commission decided that quarterly adjustments should be abolished, general accord was given to the decision by the Government, by employers and by commerce and industry generally. They said that the abolition of the quarterly adjustments would give industry an opportunity to plan without having additional wage costs inflicted upon them every three months. The Arbitration Commission then decided that it would inquire into the basic wage at the beginning of each year. Quarterly adjustments were abolished in 1953 and at that time the yearly inquiry was adopted. Now in 1960, only seven years after quarterly adjustments had ceased, this Government and the employers say that one year for the adjustment of wages following an inquiry into the basic wage is too soon. It was too soon when the period was three months; it is too soon now that it is twelve months. How far does the Government want to go? How far do employers want to go? Do they want an inquiry every three years or every ten years? I think the answer to this is that they would much sooner not have it at any time; they would much sooner the employees stayed where they are at present.

Mr Anthony:

– They would be just as well off because purchasing power would increase.


– The whole point is that honorable members here are inclined to become complacent. We are able to afford the amenities of life and to have a decent standard of living. We look out on the Commonwealth with rose-coloured glasses and say that conditions are not too bad. But we do not really appreciate the struggle of men and women who are endeavouring to purchase a home and to live, perhaps with a family of three or four children, on £15 or £25 a week. As long as we are able to afford a decent standard of living, it is our bounden duty to give to those who are not as fortunate as we are, the right to enjoy a reasonable standard of living. That was the reason for the formation of the unions and of the Australian Labour Party. Until the unions were able to demonstrate their strength and their authority, employees were never given anything. If we do not continue to fight, honorable members opposite and people in industry generally would be pleased to see the conditions of employees slip back to what they were in the early 1900’s or in 1890, or even before that.

Mr Wheeler:

– That is utter tripe!


– It may be tripe to the honorable member for Mitchell; perhaps he is being hit by the statements I make now. Never in this House has he raised his voice on matters that concern employees. But when the banks or industry are being attacked or when it looks as though the people who want television licences will have to pay a few pounds to have their cases heard by the Australian Broadcasting Control Board, he is one of the first to rise and voice a protest. Outside the House, he lobbies for these interests at every opportunity.

Only when the basic wage or the margins of skilled tradesmen are adjusted do we hear the cry of inflation from Government supporters. But to the Labour Party, the man on the lower wage, the ordinary man, deserves every rise in his wages, every increase in amenities and every improvement in conditions that can be given to him. If this Government would only take action to curb some of the activities of industry and commerce and ensure that retailers and manufacturers do not get more than a fair profit for their goods, there would be more than enough wealth in the country to provide a really good standard of living for all members of” trie community. I have much pleasure in supporting the amendment moved By the new Leader of the Opposition, the honorable member for Melbourne (Mr. Calwell). The amendment reads -

That the following, words be added to the Address: - “but desire to advise Your Excellency that the Government no longer possesses the confidence of the Parliament and of the Nation because, of -

Its failure to halt inflation with its adverse effects on wage, and salary earners, on pensioners, on persons on fixed incomes, on primary producers and on home builders, particularly those with young families;

Its action in lifting import restrictions with its accompanying threat to the employment of thousands of Australians and the. security of Australian enterprises; and

Its decision to ask the Arbitration Com mission to reject the current application of the trade union movement for an increase in the basic wage”. 1 would like to mention one other matter in the few minutes that are left to me, and that is the tradition that has been created through the ages of newspapers and magazines exerting a right to publish controversial articles in their newspapers or magazines without the name of the writer of the article appearing on it. Magazines that are regularly printed carry such names as “Jindivik”, “Mugga” and “Lacordaire “ on articles written by special correspondents, or editorials. These appear in newspapers day in and day out. Some of the editorials or articles contain most controversial statements. If people are prepared to write these controversial articles for magazines, for newspapers or for columns, surely they should be required to have the courage to place their names on the. articles. What are these, men who write these articles, these- “ Muggas “, “Jindiviks “ and others? I do not want any censorship placed, on them. If a person is prepared, to write an article, all I ask is that he be prepared to. put his name on- it.

When we make statements in the House, they are taken down and printed in “ Hansard “ for posterity to read. We have to answer for those statements. These men who write for magazines or newspapers hide their light beneath a bushel, and I’ cannot believe that their reason for doing so is that they are too modest to give their name. 1 firmly- believe that the real reason why they do not place their names at the top of such articles is because they are- not prepared’ to stand up to some of their- malicious, ill-conceived and far from factual statements. I do not know whether it is within the prerogative of this Parliament;- but I voice my opinion here because I- firmly- believe that the position cannot be remedied while these, men are able. to. remain anonymous and. skulkaround and. obtain confidential information from sources which in innocence perhaps give it to them only to find it printed a week or so later in some article in a magazine or. newspaper.


.- Mr. Speaker, I join with others in expressing my loyalty to Her Majesty the Queen and in congratulating her on the birth of her second son. I also congratulate Her Royal Highness Princess Margaret on her engagement. We have greeted our new GovernorGeneral, and we wish him well during his stay in Australia and congratulate him on his Address, which was his first duty when he came here. The honorable member for Lang (Mr. Stewart) has just been very eloquent, but as neither he nor his leaders have put up any really valid argument in support of the motion of no confidence which they have submitted, I propose to deal with another matter.

We hear on all sides that Australia is prosperous- and that her secondary industries are flourishing; and of course the strength of our primary industries, especially wools is- well known throughout- the world. Our sportsmen and. sportswomen, almost daily, are toppling records; while the voices of our statesmen- are heard and listened to throughout the world. But comparatively few of- the world.’s millions can come- and see us here, owing to. our great distance from- other countries; and, therefore, it is not. really, extraordinary that so many should think we are an out-of-doors- people whose chief interests are, perhaps, race meetings and beer. However, there is another side to our national character. I refer to the culture which we are acquiring through new citizens from overseas and which finds expression in the creative arts of the writer, artist, sculptor- and composer; who can portray- our- people- in their respective mediums:

Early this year- Australia and’ the- world were shocked to hear of the death in this country of a very great man. He was worldfamous. I refer to the late Nevil Shute Norway, better known as- Nevil Shute, the author. He chose Australia to live in and he liked his new country very greatly. He was a most unassuming man, but, as I say, he liked Australia and he saw the potentialities of the creative arts here. Honorable members perhaps do not realize that Nevil Shute spent the last few months of his life looking into ways in which these people could be helped and how he could develop the arts. In the short period at my disposal, I would like: to- make- known something of his work and research in that field and point out that the- implementation of his proposals would-, not involve much expenditure:.

At present the. Commonwealth Literary Fund has about. £12,000 at its disposal which it could utilize in this, sphere; although that sum, of course, would be- entirely inadequate for the purposes I have in mind. But Mr. Nevil Shute; to use his pen name, pointed out that not very much more would be- necessary. The young man or- woman who aspires- to authorship should have a commercial occupation and devote a few hours at night to writing. If such aspirants spend all day writing, it will no longer be a pastime at night but a fatigue. Journalism, radio, public relations, and advertising, for this reason, although popular occupations for young authors, are not the most suitable as a preparation for authorship. The aspirant needs a career in which he will meet and get to know characters many of whom will appear, in his, writings, and also the character of his readers. If “ he has such a career, he has support for. himself and, if he marries, for his family should he not make the grade as a- writer. It is therefore unwise to subsidize the young, creative writer to relieve him of the necessity to engage in everyday employment. It-, will be time enough to do, so when, be has become capable of earning his. own. living, solely as a writer.

Some writing, of course, is, never, lucrative - such as the writing of. histories, and social research books. In such cases the depart.ment which commissions the writing, should it be- a history or a work of that kind, should- pay for it; and should it be production of social research- books or anything of that nature, the work should be paid for by a- university grant and’- should be done by an experienced writer. Australians comprise 4 per cent, of the English-speaking peoples; nevertheless, relative to our population, we are one of the most- avid reading nations in the world. The question is how to tap the remaining 96 per cent, of the English-speaking world and secure translation rights in non-English-speaking countries. For this purpose a sales organization is necessary. The requirements of Australian publishers, although most of them are also booksellers, do not offer sufficient opportunities, to provide, a good living, for an, author.

United- Kingdom publishers have a bigger market, but. they do not have access to certain markets for serial rights, foreign translations, television and film rights and many other sources of royalties for authors. The young author cannot get disinterested help from his publishers. In England there is a society known as the Authors Society which is- really- the Incorporated Society of

Authors, Playwrights and Composers. That society, in the early stages of a writer’s career gives him advice in the same way as does a literary agent, and. helps to place his early work; but it. does not take the place of a literary agent. To quote the exact words, of Mr. Shute -

A literary agent may be described as the. sales organization of an author and, as in any industry, the business cannot prosper without one.

Not all literary agents are good. There are three firms of very high repute and integrity in London, and. three in New York. In turn, these, agents work- with each other and. have sub-agents practically in. every country; but above, all they know exactly where, and how to place any particular work. The. agent, is paid at . a. flat rate of 10 per cent., of the moneys in the hands of the author. The. author suffers no delay in getting his work, placed,, and he knows that it will, be submitted in many places, some of which, possibly, he has never heard of. He also, knows that it will be placed in the hands of the. persons particularly interested in that type of writing.

The arrangement is not, of course, a wellpaying proposition for the agent in the case of a new author, but the returns to the agent will increase as the author becomes better known. Out of the 10 per cent, which he receives, the literary agent has to bear all the legal expenses and the other expenses associated with negotiating for and drawing up contracts. He may even have to pay up to 2i per cent, to sub-agents in other countries. It is interesting to note that in the first three years of his writing career Mr. Shute made £135 sterling, and his agent only £15. But they remained together through the years, and, until Mr. Shute’s early death they were, year by year, more pleased with the partnership.

From what I have said it can be seen that the agent, with his steady position in the background, is necessary to give security to the writer in his early days. The unknown author, getting a little encouragement and knowing that his work is being read, will not cease writing. On the other hand, if a writer is simply subsidized by a government grant or something of the kind, he will possibly acquire the illusion that he is superior to the common man, and that people should be made to read his writings. This type of author is, perhaps, prone to become frustrated, and even eventually to become a propagandist of the Fascist or Communist variety.

Mr. Shute has suggested, among other recommendations, that the High Commissioner in London be instructed to approach the secretary-general of the Incorporated Society of Authors, Playwrights and Composers, with a view to having that body set up a branch in Australia. It might be possible to offer the organization, if necessary, a guarantee against financial loss. This arrangement could be financed from the Commonwealth Literary Fund. Mr. Shute further recommended that one of the established literary agents be asked to open a branch office in Australia. This agency could be given a guarantee that if its earnings did not reach a certain agreed figure, the difference would be made up by subsidy. The amount of the subsidy would, of course, diminish year by year as more authors took advantage of the agency’s services, and as those authors became better known and their writings were more widely read.

We come now to the creative artist and the sculptor. They differ in practically only one respect from the author; that is, in most cases they produce only one work at a time and so must sell it for a very much greater price if they are to make a living. No royalties will continue to come in if they become ill. There is also a much greater drain on their creative ability. Mr. Shute’s investigations disclosed that there is no lack of artistic talent in Australia, but that in most cases an artist can earn little more than enough to pay for canvases and paints and for halls in which to hold exhibitions. Nevertheless, they carry on in their spare time because their artistic work is their hobby and they are dedicated to it.

The numbers of students in art schools is diminishing, and the standard is, perhaps, not improving. Two things must, therefore, be done. The first is to find a way to increase sales of works of art. Secondly, we should educate the people so that they will wish to see good works around them, and, perhaps, even to put them in their homes. To-day a very extensive building programme is being carried out. Old buildings are being demolished in every city, and other buildings costing millions of pounds are being erected in place of them. It has been suggested that the Commonwealth Government could introduce legislation which would require, say, 1 per cent, of the cost of all buildings costing more than £100,000 to be set aside for adornment. This adornment could be in the form of sculpture, fountains or murals. It could possibly depict the purpose for which the building was erected.

It has also been suggested that competitions should be held before letting contracts for such works, and that these competitions should be open to overseas as well as Australian artists. This would ensure better entries, and there would be plenty of work for all. Mr. Shute has also pointed out that the Australian artist will not be at any disadvantage in these competitions, because, being on the spot, he will be able to talk to the owners of the proposed buildings and the architects who are designing them, and find out what their ideas are. Then, should his first attempt not please, he will be on the spot to provide a second one. If a foreign artist should win a competition he would come to Australia to execute his work, and he might even stay after completing it. Many people who would meet him would benefit greatly from this mingling of Australian and overseas art. If State governments could be induced to do something along the same lines this would, of course, be of very great advantage, and it would be most gratifying to see our cities becoming more beautiful than they are to-day.

The suggestion has also been made that at certain intervals, perhaps annually, selected artists should be sent abroad. Such an artist would visit, say, six countries in which we are diplomatically represented, staying, perhaps, a couple of months in each. During his two months in each country he would be required to paint two pictures, which would become the property of our government. One might be given as an example of Australian art, to a local picture gallery. One might, perhaps, be given to the president, if the particular country had a president. They might even be hung in the Australian Embassy, or disposed of in any other way which the government thought fit.

The artists concerned would reap immeasurable benefit from these experiences. If the scheme were managed correctly Australia would have the benefit of excellent advertising. The cost of the scheme would be made up of the fares of the artist and his expense allowance - and this should probably be on the generous side because he would be an ambassador - together with an allowance for his family, which would have to be sufficient to make up for the loss of earnings while he was away from his job.

The creative composer, Mr. Speaker, is probably the worst off of the lot. To start with, he composes a small piece and has to spend many hours in writing out the score. The score for a fifteen-minute ballet would take 200 hours to write out. If he worked solidly, this would take him three months. If he took time off for recreation, it would take him the best part of a year. The Australian Copyright Act 1912-1950 goes back to the day when nearly all houses had drawers full of sheet music, and when, to make a thousand records, a piece had to be played a thousand times, as only one record could be made at a time. This act also is very much weighted against the creative composer.

The third and great disadvantage that he has is that practically the only place where he can get outside advice is from his music publishers, and they tie him down to a very tight contract which keeps him poor, but does not prevent them from flourishing. Mr. Shute looked into every aspect of the composer’s life and troubles with his usual thoroughness, but, as my time is limited, I will just summarize his recommendations.

First, he recommended that the Commonwealth Literary Fund be re-named the Commonwealth Literary and Music Fund, and that it should pay for a professional music copier to be available to all composers to take the long and unproductive hours of work off their hands. In Melbourne, there is a most proficient one. The cost, even with an understudy in case of illness, and for continuity, would be £1,800 a year. Mr. Shute’s second recommendation was that the Australian Copyright Act be repealed and an entirely new one compiled. Thirdly, he recommended that the Australian Broadcasting Commission make five recordings beyond the number that it requires for its own use, and that these be given to the composer to be sent out with his music score when he is looking for people to play his music. Fourthly, it was recommended that the literary agency, if established in Australia, should also be the agent for musicians and composers. Lastly, it was recommended that Australian embassies in foreign countries should handle Australian music and musicians abroad and give them better publicity as “ V.I.P’s.”

Mr. Speaker, the late Mr. Norway spent much time on his study and collation of the subject. If everything that he suggested was carried out, the cost would be about £34,000, and if the Commonwealth Literary Fund were used, it would be considerably less. The Government has these proposals in full, and I hope that it will give them full study and perhaps put some of them into practice. This would help to eradicate the thought that we are a rough people, and it would be a very fitting memorial to a great man who was not too big to help his fellow men.


.- I wish to associate myself with the loyal sentiments expressed by the honorable member for Herbert (Mr. .Murray) when he was moving the adoption of the AddressinReply. I congratulate him on the able manner in which he made his speech to the House. I regret that I am unable to match my remarks to those which were so ably made by the honorable member for Flinders (Mr. Lindsay) on the arts. I shall devote myself to the more mundane political atmosphere .and the attitude of the Opposition in this debate.

Any hope that the Labour Party would make a comeback under its new leaders must have been sadly dashed by their performances during the first few sittings of this Parliament. It has been claimed for the new Leader of the Opposition (Mr. Calwell) that the irresponsibility which formerly marked his conduct at times has now disappeared. But the speech which the -Leader of the Opposition made last week in his attack on inflation must rank as the most irresponsible of any leader since federation, 60 years ago. He made no attempt whatsoever to suggest what Australia, within its own boundaries, could do to mitigate the world-wide inflation spiral. Obviously, to the Opposition, inflation merely -represents a heaven-sent opportunity to make party capital.

Labour’s only answer to this situation is one which failed so badly before and that is “ control “. It is claimed, for instance, that prices can be controlled. This worked well during the war - the argument runs - so why would it not work now? The answer is that during the war we had manpower control. What does Labour propose to do about this if it gets back into office? Perhaps the new leader will state where he stands on this question of man-power control. Once ‘man-power control was abolished after the war, the price control system began to break up. Things became so bad that the Federal Labour Government which was in power at the time lost faith in it altogether and handed the whole thing over to the States although at that time there was full constitutional power for federal price control.

Now, from the safe shelter of the Opposition benches, Labour puts forward again as the remedy for rising prices, the methods which failed so :badly before. “The truth is that Labour’s new leader is a socialist or nothing He .has been proclaiming socialism to the world for years. Now, when .he is elected leader, he suddenly starts the difficult process of hiding the fact that he is a socialist. The Leader of the Opposition cannot just dice his socialist lady friend overnight. No matter how he tries to dress her up in the “ new look “., her curves and vital statistics still proclaim her for what she is. In fact, despite the Leader of the Opposition’s valiant attempts, one may say, “Pardon me madam, your socialist slip is showing “.

In pursuit of his camouflage policy, the Leader of the Opposition gave some amusing television interviews last week-end. Not so amusing, however, was the performance of his week-old deputy leader who, assuming the role of the teen-age angel, preached in St. James’s Church, Sydney, on Sunday evening last. Whether or not the Deputy Leader of the Opposition convinced the Anglican community of Sydney that they could put their trust in him as the Australian Labour Party’s new Messiah is a matter which must exercise the mind of the agnostic and the true believer alike. On the other hand, all that the Leader of the Opposition could promise about socialism was to name certain undertakings, including banks, airlines, General Motors-Holden’s Limited, and the Broken Hill Proprietary Company Limited, which Labour did not intend to nationalize “ at the moment “ - to use his own words.

It is worth noting that he promised nothing and that he is still free to nationalize them at any time. These words, “ at the moment” are significant. He must intend to nationalize those industries eventually or there would have been no need to put those words in. One thing is certain: If he could nationalize General Motors-Holden’s Limited there would be no problem about large profits because there would not be any profits. The problem with Labour’s nationalized industries has always been excessive losses, as we in New South Wales know only too well.

The debate from the Opposition has been pregnant with socialist economics but nobody has yet produced a new or a fresh idea. It is obvious that Labour has no answer. The alternative is to ask, “ What can the Government do? “ If you examine the position you find that Parliament’s powers are very limited and -are ‘becoming more so every year. Almost the whole responsibility for the state of the economy now resides in the administrative machine. Some time ago an all-party committee brought in a long report on reform of the Constitution. But it is becoming more and more evident that we must look to the methods of administrative control in order to secure any really effective reform.

It may be said that the economic government of. Australia is a five-way stretch between the Cabinet, the Arbitration Court, the: Reserve Bank, the Tariff Board and the Commonwealth Parliament. They seem to rank in about that order, except that the Arbitration Court is rapidly replacing the Parliament as the principal authority. Inevitably, because this is not a scientifically constructed system, but has more or less grown up by accident, the five forces often pull, in different directions at the same time. Something must be done to secure proper synchronization.

It is essential too, I believe, Mr. Speaker, that the’ non-elected authorities which have been so- important are constituted so that they can do their jobs efficiently. I believe that it is in the Tariff Board that we see one of the- most glaring weaknesses. The recent removal of import restrictions was a bold step against rising prices, but a risky one. It might be compared to an old-time surgical operation before the introduction of anaesthetics. It might be successful, and it might not, but one thing was certain, and that was that it would be painful. This operation was certainly painful. Theoretically, the Tariff Board is on hand to provide relief, but in fact it is so far behind in its work that it will probably be a couple of years before it arrives at some of the cases - and’ in the meantime the patient may die. I suggest that, as it was the Cabinet which removed import controls, the Cabinet should provide first-aid where necessary, until this dilatory doctor arrives, through the medium of some form of interim increase in tariffs where necessary.

Tariffs are, of course, a much better, way of providing protection, than are import controls. But speed is an essential element of efficiency. Action by Cabinet could, meet an. immediate problem, but it is also desirable that the Tariff Board, should- be streamlined to reduce its permanent time-lag. I suggest that, instead’ of the somewhat cumbersome system under which, the board has several’ members and gets its information by hearing evidence from’ interested parties, single commissioners be appointed, each to take charge of one group of allied industries. There would be, for instance, one commissioner for the textile group of industries, where the tariff is crucial. He would have, or would acquire, a special knowledge of the industries he was dealing with, and woul’d have representatives nominated by the manufacturers and the importers to assist him in each case. He could take formal evidence, and could consult with the Government’s economic advisers. He would also be able to visit industries and wholesale and retail outlets in order to make his inquiries. He could, in effect, provide a continuous tariff revision service in his own section.

There would also be need for a supervising commissioner whose job would be to study the reports of all the sectional commissioners and endeavour to secure uniformity among the commissioners. He would also act as liaison with the Government on policy matters.

I believe that these changes would speed up> action; enormously, and would also secure that Government policy would be tailor-made to fit each particular case. Industry has become so complex now that, aside from the time element, it is hard for a single board to keep close enough control anyhow. In my opinion the Government should concern itself now with setting up a streamlined tariff organization to meet , the demands which will surely arise. The duty of this organization would be to deal, with problems as they occur, immediately and urgently, and not give a decision after the industry concerned has been forced: out of business. It is idle to talk of increased productivity if the threat to. a. manufacturing company is liquidation through being unable to compete with cheap-labour countries, or through a be.-kind-to-Japanese policy, or any other extemporizing effort.

Allied to the- question of tariffs is that Of overseas participation in Australian industries, which has been brought right into the limelight by the General MotorsHolden’s affair. The fact is that Australia,, which emerged- from political colonialism im the nineteenth century, is in danger from economic colonialization in the twentieth century - not because any one wants to impose it, but just because of the way in which industry is developing. The strange thing about the General MotorsHolden’s controversy is that it was only because G.M.-H., alone among the car manufacturers selling in Australia, did have some Australian shareholders that it had to publish its profit figures at all. Most of its competitors do not publish figures. I agree that G.M.-H.’s profits are too high, but the company might well ask, “Why pick on us? “. Before G.M.-H. came on to the scene not only the profits, but also the wages, which came from Australian car sales, remained overseas, and some of those profits have been very high. They have not been so high as they might otherwise have been, because of the very fact that the Holden car has provided such stiff competition. Generally, the profits which those overseas manufacturers have made on their Australian sales have never been published. In fact, they are still not published, nor do Australians share in the profits of manufacture.

Many other giant overseas firms in various fields operate in Australia in a big way, but they have not taken the Australian public into partnership. Not all of these are American. In fact, the majority of them are British. The Lever interests, one of the biggest businesses in Australia, have no local shareholding, and they recently extended into a fresh field in Australia - ice-cream manufacture - by absorbing a wholly Australian company which they bought for cash. Shell Oil is another example among many other industrial undertakings. In the pastoral field a very large proportion of the big companies are absentee landlords. Their interest in primary industries has not always been a benign one for Australia. Wholly Americanowned companies operating here include Vacuum Oil, Caltex Oil and the Ford Motor Company. More and more, success lies with these giant units, and they are quite frequently the only ones which can survive in this mass-production era. Therefore, even businesses which are Australian controlled will tend to pass into the hands of oversea firms.

I believe that two points should be stressed. First, we want partnership for

Australia. But it must be on fair terms. The blatant terms of the take-over of Kraft Holdings Limited by the Americancontrolled National Dairies is a pattern of outside acquisition which I hope will not be repeated in Australia. It did nothing to encourage confidence by the Australian investor in American business methods. Secondly, if all the big overseas companies operating here were to offer Australian partnerships, we simply would not have enough money to accept. The amounts involved would be tremendous. For the moment, in promoting a new deal for Australia it seems that to seek partnership in new establishments and to retain partial ownership and partial control in the case of take-overs is all we could handle. To illustrate my point I return to my earlier reference to the Unilever-Street’s Icecream take-over which leaves no Australian shareholding or interest. We do not want to frighten new industries away, but they should not object to having an Australian content in their shareholding and directorates - and I do not think that basically they would object. I can only affirm that in our eagerness to attract outside capital we could pay too high a price if we include Australian posterity in the bargain.

I suggest, therefore, that a committee should be appointed to draw up codes to be observed and respected for new flotations and take-overs where overseas companies are involved. This committee would preferably include representatives of the Australian Government and Australian business, as well as of the Governments of Great Britain and of the United States of America, which are, in the main, the chief contributors of outside capital. It should be possible to draw up conditions which would be fair to all. After all, a government code for outside investment would not be inappropriate if we are to maintain an Australian interest in the development of our own country.

I submit that Government policy should be shaped to the same end. That is, taxation should not press so harshly on those who comply with these general principles as on those who seek to retain all control and ownership overseas. I do not for the moment enlarge on the effect on our external financial balances, if, in the future, we are faced with the obligation of remitting profits and dividends to overseas countries in a tight monetary period.

On the overall situation I am of the opinion that the inflationary pressures at the moment are not as serious as they were in 1951. It may be argued that we face entirely different conditions but Australian production has become quite efficient in industries where the market is adequate for modern machines and modern techniques to be used. A good deal of comment has been made on improving productivity, but I suggest that this aspect may be overstressed to the exclusion of other factors. In the main, Australian labour is good, and our industrial effort is comparable to that of overseas competitors. I believe that higher production has come and will continue because it is in the interests of the industrialists and their employees to produce efficiently. Fortunately, in some industries wages have been increased with rising production and employees are beginning to realize that in rising production and greater efficiency rests the hope of improved living standards and higher real wages.

Instead of being prone to criticize industry and its workers the Government might be encouraged to concentrate on the inefficiencies of its own industries. After all, the first to increase charges after wage rises was the Postmaster-General’s Department. If we set about placing our own house in order I am sure we shall receive greater support from outside, which we will undoubtedly need. There have been several boom periods in Australia’s short history. The only thing different about the 1960 boom is that, so far, it has not had the unhappy ending which came to all the others. To see that it never comes, to make prosperity permanent, is no easy task for any government. However, we on this side of the House do not adopt the defeatist attitude that it cannot be done. Given the support of the community, we think it can.


.- It is my wish to support the amendment moved by the Leader of the Opposition (Mr. Calwell), because I believe that the Government’s policy, or lack of policy, should be censured by this Parliament. I wish to deal with one or two points in the speech of the honorable member for Mitchell (Mr. Wheeler), who has just concluded, points with which I find myself in disagreement. But I find myself in complete accord with almost all he said, and I think he could have made a much better speech from this side of the House than from the Government side. It is pleasing to note that some one at least on the Government side has awakened to what is going on in relation to foreign investment in this country, and the economic menace which this is likely to become in the years ahead.

Canada is at present experiencing great difficulty because of American investment in that country. The problem is increasing every day, and in the course of the next decade it is estimated that at least 75 per cent, of Canadian industry will be controlled by foreign capital. I do not want to see that happen in Australia. It has its place, but I shall deal with that aspect later.

The honorable member for Mitchell criticized the Leader of the Opposition for his proposal that price control is one of the essential methods of dealing with inflationary trends at the present time. He stated that post-war price control had failed, and had to be abandoned to the States because of this failure. The failure of price control at the end of the war, as the honorable member might well know, was not due to the system itself but to the lack of power available to the Commonwealth Parliament. It had power to control matters of this character only in time of war. But the period of war had ceased, and there had been cases in the High Court which challenged the Commonwealth power to exercise various controls. It was found that the Commonwealth no longer had power to control prices. Industry then could simply ignore the government of the day, and was starting to take advantage of the situation.

A referendum was put to the people on fourteen points, one of which was price control. All these points had relation to a post-war programme to maintain economic stability in this country, and to bring about development and progress for the people. A conference was held in this very chamber attended by the leaders of the government and the leaders of the opposition in every State, as well as their counterparts in the Commonwealth Parliament. They met around this table, and I was present at the discussions every day.

One would think, in view of the discussions that took .place between the various States and the Commonwealth at that time that they were trying to negotiate a peace treaty with a victorious Japan. There was much conflict as to what power should rest with the Commonwealth Parliament. The Premiers and Leaders of the Opposition in the States, and the representatives of the Commonwealth Government who attended that conference, agreed that power in respect of at least fourteen items, one of which was price control, should be given to the Commonwealth. We thought that the States would abide by the agreement, but only two agreed to support in toto the proposal in relation to price control. Some agreed to support it in part, others decided to postpone its application, and others refused support. The States did not abide by the undertaking which had been given at the conference.

There are two ways by which the Constitution can be amended. The first is a referendum of the people, the majority of whom in the majority of States must vote in favour of .the proposal, and the second is an agreement amongst the States to transfer a particular power to the Commonwealth Government. Had the States transferred to the Commonwealth the power which it then sought, I believe that we would now be in a .much happier position than we are. However, the States would not agree to do so, and the Chifley Labour Government, which was then in office, asked the people, by referendum, to give it power in relation to ‘fourteen specific matters. Because of the quite substantial opposition, due in a large measure to misrepresentation by members of the parties which now constitute the Government, the people refused to give the Commonwealth the powers which it sought. The anti-Labour parties led the people to believe that price control was a matter for the States, not foi the Commonwealth, and could be better controlled by the States than by the Commonwealth. I am sure that many people have since regretted voting against the transfer of the powers to the Commonwealth.

That does not get away from the fact that one of the ways, if not the only way, of dealing with price control and the profit inflation which is taking place to-day is for the power to control prices to be transferred by the States to the Commonwealth^ I have not the slightest doubt that the States would be ready and willing to hand over that control to the Commonwealth because their experience during the postwar period taught them that they cannot control prices. If one State tries to impose price control and an adjoining State does not, the State which takes that step can be claimed to be interfering with interstate trade, and business will flow to the States in which there is no price control.

As an example, most of the hire-purchase agreements written in Broken Hill, which is in my electorate, are made under the South Australian law with South Australian companies because the New South Wales law places certain restrictions on such agreements.

The subject of inflation has been bandied about in this chamber, and there has been a good deal of speculation in the press and in economic and political circles. As a result of what has been said about Australia’s future, I believe that the people feel more fear now than they have for quite a long time. A good deal of .advice has been given to the Government, but if that advice is taken I believe that there will be a lowering of the standard of living of the workers and a restriction of our economic and industrial progress. What we really need to do is to analyse the circumstances surrounding our national progress. We should consider both our short-range programme, which is designed to have an effect in the immediate future, and our long-range programme. Other countries, including Russia, have long-range plans covering five and ten years.

Wonders will never cease! To-day I heard the honorable member for Hume (Mr. Anderson) support the “taxation proposals of Mr. Khrushchev. He said that sales tax is being imposed in Russia, just as the Liberal Party is imposing it here. He chided the Labour Party because we want a reduction in sales tax. His argument was, “You are not in keeping with Russia. The Government is more in keeping with Russia because we are implementing a policy similar to hers in relation to sales tax.” There is a saying, “’ Never a dull moment “. We get many dull moments in this House, but occasionally some one like the honorable member livens .up the show. The Government has-no immediate.plan to deal with the problem of inflation. It has nothing in mind which will help the community in the immediate future, and it has ‘no long-range plan for the .progress and development of our country. Probably the Government expects to have only a short life and does not think that it is worth while introducing a long-range plan.

This could be a good year for Australia if the anti-inflation experts do not get too much control and implement policies which will injure the wage-earners and the lower income group, and will favour big business and the higher income group. Every time a worker or a businessman has a few pounds in his pocket to spend, some one comes along and says that there is too much money in the hands of the people and it is time that something was done to take it from them. I have never been able to find that elusive person in the community who ‘has too much money ‘to spend. In fact, many people, particularly those in the lower income group, complain that they do not have sufficient money to pay for their ordinary daily requirements. There has been ‘too much talk about too mucin spending ‘power being :in ‘the hands of the people. It will be a very sad day indeed if ‘higher taxes are “imposed and other drastic steps adopted to take it from them. 1 :am in favour of .an economy in which every one has £1 to spend and ‘every one reaps the benefit of ;his labours. The worker who receives higher wages lis better off because of the greater spending power which he has. The -man in business, the manufacturer, the primary producer, all benefit .from this -greater spending power. Consequently, if people have to .choose between, on the one .hand, ‘inflationary conditions, as .they are called, -with high .spending .power, and on the other, deflation with a risk of unemployment -^designed to force down .prices and to .take away spending power, I am sure that they will prefer to have this condition which is called inflation.

It is estimated that the recent basic wage increase has ,put .between .£150,000,000 and £200,000,000 -of extra spending power into the hands of the workers. J think that the increase was .awarded to ,give the workers a higher standard of living. Increases in wages never precede rising costs but, -instead, -are constantly following costs. It -is >only after the unions can establish in the Arbitration Court that costs have increased that the workers receive an increase -in wages. -In other words, they only receive an increase in wages to meet an increased -cost of living .and in .order to maintain the standard of living which they have previously enjoyed. The object in making quarterly .adjustments in the basic wage was to maintain a. stable standard of living, not to give a higher standard of living. The Government should not try to reduce the spending power of the people.

Some honorable members have advocated that interest rates be increased to restrict the flow of money and the spending power of the people. That seems rather anomalous. The honorable member for “Hume said that an increase in interests rates would have a very marked effect. But such an increase would mean that the wealthy man who has capital to invest would .get a .greater return in interest, and therefore more profit out of his money.

Mr Anderson:

– I was talking about the discount rate, not about interest on overdrafts.


– Take overdrafts. The -man whom the honorable member claims to represent - the primary producer - probably already has an overdraft and is paying interest on it at a certain rate. If interest ‘rates were increased the interest on his current overdraft would ‘be increased also. It would not be a matter only of an ‘increase in the interest rate applicable to new advances.

Mr Anderson:

– ;I suggested separate development bank departments of the private banks, ‘but I did not suggest that they should charge .interest at higher “rates.


– Apparently, the honorable member does not know what he wants. The point is that, if interest rates were increased, interest charges on existing overdrafts held by primary producers would rise. Many men find ‘that the greatest burden on production to-day is the interest charged on money borrowed. It has been suggested .that if you increase interest rates, you will only ‘prevent somebody .from borrowing an extra £1 or £2. But that is not the position at all. Money already on loan would represent the greatest part of outstanding loans for some time after interest rates had been increased, and the existing loans would bear interest at the increased rates. This would place a far greater burden on the man who already has an overdraft, and it is not true to say that it would just restrict the man who wants a new loan. Therefore, this suggestion that interest rates be increased is stupid, and the arguments advanced in support of it are fallacious.

Government supporters advance this suggestion and, at the same time, support the Government in sending a representative to the Commonwealth Conciliation and Arbitration Commission to put a case against increased wages for the workers. We in this Parliament understand, though it is pretty hard for the public to understand, this advocacy of increased interest rates for one section of the community to the detriment of another section, at the same time as Government supporters oppose measures that would ease the burden on the wageearners. Honorable members opposite cannot have it both ways. If we are to have restrictions, they should apply to every one. If wages are to be pegged, prices should be controlled, because most of the present inflation is due to increases in profits and prices.

The words of Dr. Coombs, the Governor of the Reserve Bank of Australia, have already been quoted in this debate, but perhaps I may refer to them again. Prices are continually rising, and there has been no restraint on price increases. In a statement that he made recently, Dr. Coombs said it was clear that, for a wide range of goods throughout the economy, prices were determined by management rather than by market forces. He meant by that that prices are based, not on a fair margin of profit added to the cost of production, but on what the seller thinks he can get, and that the seller tries to get as much as he can above a fair margin of profit. This means absolute exploitation of the community. Dr. Coombs went on to say that the determination of prices by management rather than by market forces had “ developed the emergence of strong monopolistic elements in the economic structure”, and that these were characterized, among other things, by gentlemen’s agreements on price policies and successful take-over bids. He added -

There appears to be a general reluctance to pass on to the consumer the advantage of lower costs achieved by higher productivity.

Dr. Coombs said, also, that he believed there was considerable scope for price reductions in many fields of production and distribution, and he further stated -

  1. . it must be recognized that in a world of rising production wage earners naturally expect a reasonable share in the higher standards of consumption made possible.

These things can be substantiated. The honorable member for Mitchell, for example, pointed out that one of the greatest offenders in this practice of taking advantage of the inflationary situation was the Government itself. Although the Post Office has shown a profit of about £6,000,000 on its operations for the financial year 1958-59, the Government has imposed additional telephone, postage and other charges which will bring in millions of pounds more. These increased charges have added considerably to the operating costs of businesses and industries, as well as to the costs of primary producers and others in the community. The Government is increasing the revenue of the Post Office, not in order to meet its ordinary operating costs, but in order to finance capital works. In effect, the cost of capital works is to be recovered in the prices charged for the service that it renders. I think that this is against all the principles of good government. The present generation should not have to pay in order to provide essential services for the generations to come, although it should have to provide, in its own time, for its own requirements of consumable products. Capital works for the Snowy Mountains Hydro-Electric scheme, the Post Office and the like represent something for future generations. They should be financed out of loan money and, therefore, paid for by future generations. They should not be financed out of taxation.

The point that I want to make is that this Government has introduced this principle of including capital costs as part of the cost of a product or a service. This process has been going on for some years, and the present Government has been taxing the people to the tune of £200,000,000 or more a year in order to finance capital works. The Broken Hill Proprietary Company Limited, in turn, thought this was an excellent idea, and it has now adopted the same principle. It has increased the price of its steel and has admitted openly and freely that the increase is part of an attempt to finance capital expenditure undertaken by the company, and that the prices of its products are not now based on a fair margin of profit.

Mr Uren:

– It is making more profit.


– Yes. Instead of raising capital in the usual way from the existing shareholders or by new share issues, it is raising additional capital by increasing the prices of its products. Unfortunately, the increase in the price of steel will result in increases in the cost of motor cars, homes, commercial buildings and all the other things in which steel is used. I repeat that the principle responsible for this trend was introduced by the present Government, which decided to include capital costs in the price of services. This is no longer a new principle. It is part of the great inflationary process begun by the present Government with its policy of financing capital works out of taxation.

I recently read in the financial columns of the press - probably other honorable members also saw the reports - that a number of companies are following the practice adopted by the Broken Hill Proprietary Company Limited and increasing their prices in order to obtain funds for expenditure on capital works needed for the expansion of their activities.

Mr Uren:

– General Motors-Holden’s Limited is an example.


– That is an example well known to everybody, and it is unnecessary for me to dwell on it.

The point that I want to make is that this Government has encouraged inflation. In 1949, it came into office on an explicit promise to the people to put value back into the £1. Government supporters join in the joke themselves and think what fools the people must have been to take the bait, because the electors must have known that this Government had no intention of putting value back into the £1. As I have said, the Australian Labour Party advocated the retention of Commonwealth prices control, but the parties that comprise the present Government advocated lifting the lid off everything and letting prices and everything else go free and without restraint.

This Government has fallen down on its job, because it has not put value back into the £1. As a matter of fact, the £1 is not worth half as much to-day as it was when this Government took office. It is interesting to note that, between 1948 and 1957 - a period in which the present Government was in office almost throughout - retail prices in this country increased by 98 per cent., compared with increases of 50 per cent, in the United Kingdom, 26 per cent, in Canada, 52 per cent, in New Zealand, and 18 per cent, in the United States of America. Between 1951 and 1959, retail prices in West Germany increased by only 9 per cent. As a matter of fact, our costs have increased more than those of any other country, with the exception of two of what we might term the European free countries.

It is to the discredit of this Government that it has the worst record of any country for retaining a stable economy, particularly as supporters of this Government were elected to office on a promise to put value back into the £1. They have failed to honour their promises, and they have no policy to meet this problem. The country is faced with grave difficulties because of the inefficiency of the Government. I had hoped that the unemployment situation would have been improved long ago.


– The Opposition claims that it has a new look, and it has moved an amendment to the motion for the adoption of the AddressinReply. I believe that, in fact, the Opposition has a new look; it is the new look of the tail between the legs. The Opposition has moved this amendment in an extraordinary way. I have had an opportunity of looking at old copies of “ Hansard “, and have compared some of the statements that were made by the leaders of the Australian Labour Party last week with those made in previous debates. In 1952, on 7th May, the present

Leader of the Opposition (Mr. Calwell), said; when referring to the Government’s record -

What a record! Let me try to put it to the House in a few words - ruinous and confiscatory taxation, unnecessary and indefensible bank credit restrictions, fantastic restrictions amounting to virtual prohibitions on- imports involving forced wholesale repudiation of firm orders-

Mr Curtin:

– How right he was.


– Yes, but that is quite the opposite to what he said a week ago. In the same volume of “ Hansard “, Volume 217, at page 743, the present Leader of the Opposition is recorded as saying in 1952 -

Let me state our main objections to the Government’s action. Import restrictions require administrative and arbitrary decisions, which afford vast opportunities for inefficiency and human failing. Import licences are always based upon a “ base “ year, and small businessmen are thereby placed at a grave disadvantage compared with big importing houses. Direct controls of this kind make goods- scarce without raising their import prices, so that either big profits can be made by those importers who have licences, or goods at a low price become scarce, which creates a need for queues, rationing, waiting lists and purchases by preference.

This is the man who has moved the amendment to the motion for the adoption of the Address-in-Reply, and who has criticized the Government for lifting import restrictions. There is no doubt that there are economic problems facing Australia, but let us not think that we are alone as a nation in facing problems. Perhaps our particular problems are unique, but the fact that other countries have similar problems is illustrated by the third report of the British Council on Prices, Productivity and Incomes, headed by that leading figure in economic matters- in the United Kingdom, Lord Cohen. The report states at page two -

This leads us in Chapter VI. to discuss what is. for many countries today the great unsolved problem of economic policy, i.e., how to hold a middle course between the mood and measures of restraint, which stop prices rising but also hold back output and employment, and those of expansion, which stimulate output and employment but lead to constantly rising prices. This rise in prices is bound up with a rise in money incomes, and the problem would be more manageable if there were some means of ensuring that these- incomes’ did not, in total, rise more than output even when the economy was fully extended.

In coming- to the aid of his leader, the Deputy Leader of the Opposition (Mr. Whitlam) took licence with accurate reporting of the judgment of the Arbitration Commission: of December last in what is known as the margins case. The Deputy Leader of the Opposition said last week that the. Commonwealth Arbitration Commission had said -

We are- aware in the past increases in wages have led to increases in prices, and we. believe that in some cases increases in wages have been used as an excuse for increasing prices when these could have been avoided.

It sounds quite devastating until one looks: at the judgment. When you read the. judgment, you realize that the Deputy Leader of the Opposition took licence in reporting what the commission had said, because the. commission went on to say -

However, we must accept the situation that in the past’ wage rises have caused cost rises, even though this is not universally true. We have evidence before us of decreases in prices in some consumer goods at a. time when wages were slightly increased through basic wage changes.

The Deputy Leader of the Opposition also said that the Arbitration Commission had said that aggregate profits of companies were such that a margins increase could be granted: What he did not read out was that the commission had immediately stated that if had considered whether the criterion it should examine was the percentage of profit return” on shareholders’ funds invested or aggregate profits. The commission has, on occasions in the past; expressed’ the view that” if there- were a valid and reliable percentage profit return on shareholders’ funds invested,- it might be better to use such a return, but because they could not rely on it, they would look at aggregate profits instead. Of course, that index of percentage of profits on capital investment is to be found in the Commonwealth Statistical Bulletin^

The Deputy Leader of the Opposition went on to say that prices had not risen as much in the last year as they had in several previous years when’ the Prime Minister (Mr. Menzies) has been in office. The honorable member added, speaking of prices- -

It does’ not look as’ if they are yet equalling some’ of the redoubtable records which he established in that sphere- during the 1950s.

What the Deputy Leader of the Opposition did not point out was that prices were going up prior to August, 1953, when the Arbitration Court varied the quarterly adjustment based on the C series index. Prior to that, wages were going up, prices were rising and wages were following. We all know the extraordinary extent to which the basic wage rose in those few years from 1947 until 1953.

There has been some talk of the desirability of measuring productivity. We know the Commonwealth Statistician’s attitude towards this problem is that he fears that no proper index can be contrived to measure productivity. I sympathize with his attitude and share his fears. A leading authority - perhaps the leading authority in the world - on productivity measurement is Solomon Fabricant, chairman of a group of the National Bureau of Economic Research of the United States of America. Mr. Fabricant published Occasional Paper 63 of the National Bureau of Economic Research last year. In that publication, he pointed out that whereas productivity can be measured quite accurately in retrospect, lt cannot be measured while in the course of happening. This particular fact has been borne out by the third report of the Council on Prices, Productivity and Incomes of the United Kingdom, from which I quoted earlier. And at page 10 of that document the council stated -

Increasing productivity is the key to economic progress but it is not an easy thing to measure. Output per person can be calculated and in the short run it is probably as good a measure as any, but it is as well to know what its limitations are. Broadly speaking an increase in productivity means producing more with the same amount of resources.

So even if we could contrive to construct an .index which would measure output per man-hour, we would need to know the limitations, and to realize that the index should not in any circumstances be thought of as a criterion, but merely as offering some assistance when looking at the problem.

The word “ productivity “ is widely used not only throughout Australia but also throughout the world. There is misunderstanding in the use of the word and in the meaning of the word. There is conflict in its meaning and there are misconceptions.

There is an idea current that an increase in efficiency achieved by mechanization or automation means an increase in productivity. But this is not necessarily true. What needs to be done is to examine the cost of the capital required to instal the mechanization or the automation. When we walk into a factory and see what appears to be an aggregation of very efficient machinery, or automation, there is a tendency to say that there must be high productivity. However, the point is that the capital required to purchase that machinery may in fact exceed the cost of the labour it replaced. So, even though there is an appearance of efficiency, there may be reduced productivity.

Perhaps the best way to describe productivity is to say that it is a ratio between the input and the output expressed in the unit cost of the finished goods. Items of input are such factors as labour, material, technical know-how, capital, management and organization. That is not an exhaustive list; input covers a whole range of factors. The output, of course, is the manufactured article. A wage rise increases the cost of one of the items of input - that is, labour. But it does not stop there. The wage increase generates increases in almost all the other items of input. It would follow that, by increasing the cost of input, the cost of the finished article expressed as a unit cost of production would rise. So that, in the climate of our present economy, a price rise of fairly large magnitude seems the inevitable result of the decisions of the Arbitration Commission last year.

The House will recall that last year the basic wage was increased as from the first pay period after 11th June, 1959, by 15s. a week and margins were increased by 28 per cent, as from the first pay period in December, 1959. They were two momentous decisions given within a period of six months. In order to fit these two decisions into the proper atmosphere, it is necessary to look at the background of industry in the post-war years. Immediately after the war, a tremendous consumer demand was unleashed. At the same time as this unleashing of this consumer demand, there was a very great labour shortage. People in Australia were concerned only with the volume of production; they were not concerned with productivity. Indeed, in those days immediately after the war, the word “ productivity “ did not have a very real meaning for many people. The result was that excessive capital equipment was used by manufacturers to achieve this high volume of production. What happened, in effect, was that there was reduced productivity, even though the volume of production had greatly increased. Since this period, industry has been struggling to overcome this handicap. I refer to a publication “ Survey of Manufacturing Activity in Australia”, produced by the Commonwealth Department of Trade. At page i of the general summary, this statement appears -

Many manufacturers are operating well below capacity and, in most industries, production could be lifted considerably. The market has remained competitive, therefore, even for industries experiencing strong demand for their products. Many manufacturers reported price reductions, which, though not general, were widespread. They were noticeable particularly in industries producing consumer goods, but were also reported by manufacturers in industries supplying plant, equipment and machinery.

This gives the lie to the propaganda pushed by the Labour Party that this is a profit inflation. That is not true. Industry has been trying very hard to overcome the effects of the two wage decisions.

In 1954. the census showed that salary and wage earners in Australia numbered 2,917,000. It would be reasonable to assume that the number to-day would exceed 3,000,000. Even at 3,000,000, every shilling increase in the basic wage means an annual increase in the wages bill of £7,000,000 a year at a minimum. If we multiply 15s. by 7,000,000 we will find that the increase in the annual wages bill as a result of the basic wage decision is between £105,000,000 and £110,000,000 for a full year. In addition, the margins decision of December last year increased the margins for skill by 28 per cent. The increases ranged from 6s. for a process worker, 21s. for a fitter and 35s. for a duster to many hundreds of pounds a year for some salaried employees. If these two are added together, it is reasonable to say that the combined effect will be a cost to the wage structure well in excess of £200,000,000.

The point I wish to make to the House is that this is a liability which will not be borne and which cannot be borne by a section of the community. It cannot be borne by the profiteers, if there are such; it cannot be borne by the employers as a class. It must be borne by the community as a whole, and the community must face the problem. A price rise is inevitable, unless there is a productivity increase. Of course, in the post-war years there has been a productivity rise in Australia. The question is: What has been the extent of that productivity rise? I referred earlier to the paper of Solomon Fabricant. I refer now to page 3 of the paper in which he gives his summary of conclusions relating to the period from 1889 to 1953 in the United States. He says -

Over the sixty-four years between 1889 and 1953 - the period which has been examined most closely and for which presently available statistics are most adequate - the rate of increase in productivity has been as follows: -

Physical output per manhour in the private economy has grown at an average rate that appears to be about 2.3 per cent, per annum.

A measure of productivity for the private economy that compares output not only with labor input (so determined) but also with tangible capital, each weighted by the market value of its services, grew still less rapidly - about 1.7 per cent, per annum.

If the United States in that period of 64 years, a time of tremendous industrial growth, had an average increase in productivity of only 1.7 per cent, per annum, it would be the height of folly to assume that the increase of productivity in Australia had exceeded that rate. We can only estimate what has been our increase of productivity. If we look at the two decisions of June and December of last year and take a fitter as an example, we will find that the wage increase for a fitter from the June and December judgments was £1 16s. a week in six months. This is the nominal wage, the award rate. This increase of £1 16s. represents an increase of 10 per cent, in his wages. We cannot say accurately what the productivity increase was but on an estimate we can certainly say that it would not exceed 2 per cent.

If we look back over the period, we might say that he had this increase of 10 per cent, last year, but what about his loss in the previous years? There was no loss - there was a gain. In 1946, the basic wage was £4 16s. a week. At the end of 1949, it had climbed to £6 9s. From the end of 1949 to August, 1953, when automatic quarterly adjustments were suspended, the basic wage increased from £6 9s. to £11 16s. in the short period of three and a half years. This was the effect of the pernicious system of automatic quarterly adjustments tied to the C series index. But since the cessation of the automatic quarterly adjustments in 1953, a period of seven years, the basic wage has increased by only £2, to £13 6s. Expressed in another way, in the three and one-half years from the end of 1949 to August, 1953, the basic wage nearly doubled, but in the seven years since the cessation of the automatic quarterly adjustments it has increased by only 17 per cent. What of the C series index during that time? It nearly doubled in the early period, from 1949 to 1953, a matter of three and one-half years. Since 1953, the C series index has gone up by only 14 per cent. This clearly indicates the pernicious nature of the automatic quarterly adjustments which the Australian Council of Trade Unions, in each basic wage case, asks to be re-introduced. It must not be forgotten that, in 1954, there was the two and onehalf times margins decision which, like the last one, flowed right through the wage and salary structure; and the fitters’ margin rose from 52s. to 75s., an increase of 23s.

An error which is constantly made is to compare the basic wage with the C series index. Such a comparison ignores the inclusion in the wage of margins; and I know of no one who has not a margin of some kind. Besides the margins there are the over-award payments in respect of which the unions, in the margins case, made a great feature and submitted a great number of exhibits. A survey of over-award payments shows that such payments to members of the electrical trades in Victoria average £2 lis. Over-award payments to the members of the Australian Society of Engineers amount to £1 12s., while those made to moulders in New South Wales average £2 8s. Margins and overaward payments make up the real wage, and it is the real wage which must be contrasted, if anything is to be contrasted, with movements in prices. The Arbitration Commission stated that it took into account the effect of the over-award payments when it awarded the 28 per cent, increase in margins; and the increased real wage of to-day is the result of productivity. The productivity increase is the achievement of all sections of industry, and great tribute must be paid to every one working in industry - the skilled and unskilled, managements, shareholders and owners. Everybody has contributed to the productivity increase which has enabled a real increase in the wages paid to the people of Australia.

But it is true to say that productivity can be absorbed either by reducing prices or increasing wages. Productivity is shared by the community in one of those ways, but it is well to remember that while this increase in real wages has been going on there have been other factors, such as a 40-hour week and annual leave of three weeks, which has been extended to a great number of people. There have also been long service leave and superannuation. All those things have to be taken out of the fruits of productivity. There has been a general sharing in the fruits of productivity, and prices are certainly lower than they would have been had there been no productivity increase. The claim that current inflation is a profit inflation is not supported by fact. The Commonwealth Bank Statistical Bulletin for June, 1959, at page 159, shows that from a 10.4 per cent, profit returned on capital funds invested in 1955, the figure has dropped to 9.2 per cent, in 1959. To say that this is a profit inflation is untrue and does a disservice to people who contributed so much to the productivity increase and tried to keep prices down.

I now turn to the fantastic claim that the Commonwealth Government is trying to intimidate the Arbitration Commission by intervening in the present basic wage case. The Commonwealth has intervened, to my knowledge, in at least the last four Commonwealth basic wage cases. In 1956, there was a 10s. increase, and counsel for the Commonwealth intervened in the public interest and submitted that the court had been correct in its decision in 1953 to abolish the automatic quarterly adjustments. In 1959, the Commonwealth appeared in both the basic wage and margins cases. But the necessity for the Commonwealth to intervene on this occasion arises from the judgment of the Arbitration Commission in 1958. in which it said -

The question also arises whether in the fixation of margins the Commission should ignore Commonwealth Government fiscal and general economic policy and whether it should proceed to a decision which, if the Government thought necessary, could be remedied by some fiscal or other Governmental action. It was submitted to us by the Commonwealth in this case, as it has been submitted in basic wage cases, that in any event the Commonwealth has not the necessary powers to deal generally with economic problems.

The commission added -

It will not ignore the consequences to be expected from its actions but it will not deliberately create situations which would need rectification by Governmental action. It will not use its powers for the purposes of causing any particular economic result apart from altered wages although in the event the decision it makes may have other economic consequences.

That is what makes it necessary for the Commonwealth to intervene on this occasion.

Mr SPEAKER (Hon John McLeay:

Order! The honorable member’s time has expired.

St. George

.- It has been customary during this debate, Mr. Speaker, to rise and congratulate His Excellency the Governor-General on his accession to his high office and to congratulate Her Majesty the Queen on the birth of another son. I therefore do not propose to take up my time in speaking similarly. But I would like to extend my congratulations to Mr. Speaker on the impartial manner in which he has controlled proceedings in this chamber since I came into this Parliament. I ask you, Mr. Deputy Speaker, to convey my remarks to him. He has distinguished himself by his tolerance, fairness and impartiality. I only wish that the Minister for the Army (Mr. Cramer) were here to join me in congratulating Mr. Speaker on his tolerance. By his action this morning, Mr. Speaker indicated his fairness and impartiality.

Labour’s policy in regard to the appointment of Governors-General is that the holder of that office should be drawn from the ranks of the Australian people and that every Australian citizen is entitled to qualify for that august position. There was a time when Rome was a Commonwealth, even as Australia is a Commonwealth. During that period of Roman history there were some emperors who taught that loyalty should be paid not to the person but to the position of Emperor. That is the position we find in the British Commonwealth to-day, where we extend our loyalty to the Crown rather than to the person of the reigning monarch. I think we are singularly fortunate in this period that we have not only a symbol to which all the Commonwealth can give loyalty, but also physically and spiritually a beautiful queen. I might have said, when referring to Roman history, that Rome had no finer hour than when Romans gave loyalty to the office rather than to the person of the Emperor. Once the Romans departed from that principle, he was a lucky emperor who lasted more than five years. An emperor usually died either by violence or by poisoning within that time.

I think Labour may eventually reach the stage at which it will allow an extension of the principle that a Governor-General must he picked from the Australian people. It may eventually agree that a GovernorGeneral of Australia may be selected from any one of the countries in the Commonwealth of Nations. When I think of the Commonwealth of Nations, I do not think only of Australia, New Zealand and Canada; 1 think also of India and Pakistan and the Malayan Federation. I see no reason why Labour should not eventually agree that the Governor-General of Australia may be selected from any one of the countries in the Commonwealth of Nations. When we reach that point, we will be well on the way to eliminating the colour prejudice that still exists in this world, and to establishing firmly the brotherhood of man.

The Leader of the Opposition (Mr. Calwell) proposed an amendment last week which would have the effect of adding certain words to the Address-in-Reply. In proposing that amendment, he severely criticized and castigated the Government for its attitude towards inflation. I want to refer now to the years that followed 1945. when the war came to an end. A Labour government remained in office for the following four years. They were four years of extraordinary difficulties. Everybody here can remember the blackouts that occurred and the shortages that were experienced. Those shortages were the result of insufficient capacity in our factories to produce goods, and in our machinery to produce power, rather than of any failure on the part of labour in the factories and the mills. It was a very difficult period. It is interesting to look back and reflect that the first State to emerge from the era of power shortages was New South Wales, which has had a Labour government continuously for the last nineteen years.

Mr Duthie:

– What State do you come from?


– I am pleased to say that I come from New South Wales. I was born in Queensland, however. In 1949 the basic wage, in the time of a Labour government, was £6 9s. a week. We have now entered the year 1960, and the basic wage is nearly £14 a week. I do not know what better measuring rod is required to discover the extent of the inflation that we have experienced in this period. The basic wage has more than doubled in about eleven years. The Opposition is very concerned about inflation, despite what the honorable member for Hume (Mr. Anderson) may have to say by way of interjection. If inflation continues to increase at its present rate, by 1970 the basic wage may be £28 a week. Ten years later, with the same geometrical progression, it could be £56 a week. Labour believes that something must be done, therefore, but it would not subscribe to the policy being propounded by this Government - if it can be called a policy.

The Government complains plaintively about its lack of constitutional power to deal with inflation. We have suggested that if the Government has any complaints about its lack of power to deal with the situation, there is an obvious remedy available. It can go to the people and seek, by way of referendum, sufficient powers to deal with inflation as it exists to-day. But I have come to the conclusion that the Government is afraid that if it did go to the people, asking for power to deal with the situation, the people would give it that power, and then it would be forced to do something. Being a government of inaction, it does not want power to deal with the situation, and would rather allow the country to continue to drift.

I now wish to make a reference to the Commonwealth Government’s appearance before the Arbitration Commission in the present basic wage hearing. I recall a time when wages in Australia were pegged. That was in 1953. Wages vere fixed for just on three years. Wage-pegging did not end until 1956. At the time when the

Arbitration Court decided to freeze the basic wage, I was on the federal council of the Australian Textile Workers Union,, which was then holding its annual conference in Hobart. When the Government’sintentions, or its hopes, with regard to the Arbitration Court, were discussed by my federal council, I said, “ In all fairness we must concede that the Government is the government. Whether it got into office honestly or dishonestly does not matter very much now. If it wants to do so, it can put forward the view that if wages were pegged the country would be better off, prices would be stabilized, costs would flatten out and conditions generally would be improved.” That was in 1953, but by 1956 it was apparent that although wages had remained unchanged for three years, prices had constantly tended to rise. I think the patience of the workers was very sorely tried in those three years, and that the experiment which failed at that time should never be repeated:

For these reasons we believe that wagepegging is not the answer, and that the Commonwealth Government would have been well advised to keep out of the Arbitration Commission. It was amply proved during the three years I have spoken of that any stability that may be achieved from the methods advocated by the Government, any slowing down of the inflationary progress, will be at the expense of only one section of the community.

There are three principal factors involved in the inflation problem - wages, prices and profits. As I said earlier, I believe the Government, if it has not got the power now - I have seen no attempt on its part to test whether, indeed, it has the power - should seek power, by way of referendum, to deal with prices and profits. But if the Government went to the people on this issue it might get a shock to discover that the people are so weary of inflation that they would give the Government power over prices and profits. If the Government is sincere in its desire to deal with inflation, it will not place the whole burden on the working people, but will endeavour to obtain power to control prices and profits as well as wages.

The Leader of the Opposition had something to say about import licensing. Last’ Thursday night the Prime Minister (Mr.

Menzies) came into this House with the deliberate intention, I believe, of belittling the Leader of the Opposition. This was obvious from the manner in which he conducted himself. In 1951 there was a flood of imports into Australia, and the import licensing system was established for the purpose of slowing down the rate at which goods might be brought in. In his speech on Thursday night the Prime Minister adopted theatrical postures and attitudes, and he gave a false description of Labour’s attitude towards import restrictions in 1951-52. In a patronizing and paternal way he built up a case which rested upon a lie.

Labour’s attitude to-day is consistent with what it was then. In 1951-52 our objections to import licensing were perfectly justified, because we objected only to the manner in which the restrictions were applied. We said there was trafficking in import licences, especially in the B class categories. I have had long experience of this matter, especially in the textile industry, and I saw import licences for goods in certain categories transferred and used for the importation of textiles, resulting in thousands of workers in the textile industry being thrown out of employment. Labour’s objection was to the way in which the system was operated, rather than to the system itself.

In 1960 we are to witness another flood of imports. I forecast that we will have unemployment which the Government will call disemployment. Will the people get cheaper goods? I say, “ No “. The Government’s friends, the big retailers, will reap an enormous profit from the cheap goods which, they will bring in from Japan and any other low-wage country that has such goods to offer. There is a story told about a professor of economics who set examination papers for ten years during which the questions remained the same. When he was asked why they were always the same he said, “ It is all right to have the same questions every year because every year the answers change “.

Sitting suspended from 5.56 to 8 p.m.


– Prior to the suspension of the sitting, I was dealing with some of the arguments advanced by honorable members on the Government side about inflation. I was about to refer to the policy of the late Ben Chifley in the year 1949 when the Labour Party was defeated at the polls. Heavy pressure was brought on Ben Chifley to offer the same inducements as were being offered by the then Opposition, namely, plenty of petrol, the abolition of petrol licensing and an endowment of 5s. for the first child. Contrary to the unfulfilled promise of the Menzies Government, which was elected to office in that year to put value back into the £1, value would have been retained in the £1 if the Labour Party had been returned to office. But that was not to be, and the main reason was that Ben Chifley was too honest to offer bribes to the people. In Ivor Brown’s book entitled “ Meaning of Democracy “, he wrote -

Bitter and inevitable disappointment awaits the teacher who imagines that the people have only to be told the truth in order to be induced to follow it.

Ben Chifley told the truth and his government was defeated. Although the Labour Party has been out of office ever since, it will not be very long before that situation is altered.

I want to refer to the means test and the way in which it is being applied in this country. Many cases have come to my notice of people who during their working lives paid heavy taxes but because of the means test are deprived of any benefit from their efforts to provide for the future. A Government supporter has described the means test as “ a penalty for thrift “, and so it is. Although the Government has said it will do something about relaxing the means test, I forecast that very little alteration will be made. It is interesting to note that in countries which the Government would have us believe are poverty-stricken, such as New Zealand, Canada and England, the means test has been abolished. But in prosperous Australia, it is still retained. This Government talks about prosperous Australia. Why does it not abolish the means test?

In Sydney a company known as Security Units Proprietary Limited is in operation. Old people can deposit their money with it and receive a dividend each year. If this Government were perfectly honest with the old people of this country it would establish a fund into which the old people could deposit their money and obtain from it a better pension. This would pave the way for the abolition of the means test. Perhaps one of the objections to the abolition of the means test arises from the influence exerted upon this Government by overseas shipping and airline companies who want it continued. This is because old people in thousands are spending large sums of money on unwanted trips overseas so that they can qualify for a pension.

Government Supporters. - Nonsense!


– That is perfectly true. The last thing to which I wish to refer is the Government’s attitude towards the proposed international airport at Tullamarine. There has been a lot of talk in the Sydney newspapers, especially the “ Daily Telegraph “, about what the Government hopes to do at Tullamarine. In fact, the “ Daily Telegraph “ has cast a spanner into the Government’s works. My attitude is shaped by the certain knowledge that vast expenditure on Tullamarine will certainly mean no extension of the 16-34 or short runway out into Botany Bay. If that runway were extended, planes could use it to take off and land across the bay, and that would guarantee far greater safety of life, limb and property in that vicinity.

When the “ Daily Telegraph “ snapped viciously at the Cabinet and the Liberal back-benchers it was as if a trusted watchdog for the Liberals had suddenly displayed the symptoms of hydrophobia. The Cabinet and the Minister for Civil Aviation (Senator Paltridge) ran helter skelter for safety, and they have been afraid to open their mouths ever since. However, I will attempt a forecast of their behaviours in the next financial year. They will sneak-spend moneys on Tullamarine as inconspicuously as possible until they can safely go the whole hog and make Tullamarine the international airport for Australia. But the obvious and logical thing to do is to proceed here and now with development of the Kingsford-Smith airport.

There has been a great deal of talk about the price of progress, but it is too high when it has to be borne by too few people. The people who live in the vicinity of KingsfordSmith airport are paying a very heavy price, particularly those who live at the runway end where the Boeing jet aircraft land and take off. Surely the people of Sydney are entitled to as much consideration as the people of Hong Kong. There, the runway for jets is built out into the bay and as a result the people are not subjected to the same nuisance caused by noise, and the element of danger is reduced. If it is good enough for the people of Hong Kong to receive that consideration, surely it is good enough for the people of Sydney to be treated likewise.

I want to try to describe the noise caused by these jet aircraft. I made it my business to visit the Kingsford-Smith airport long before a group of Liberal members went there at the invitation of the “ Daily Telegraph “. I made the necessary inquiries myself. I listened to a Boeing jet aircraft passing overhead and the noise was like a thousand thunder storms rolled into one. lt was like a blow from a gigantic hammer coming down from the sky. I direct attention to the effect of this noise on the health of children and animals and on property as well as its injurious effect on adult residents. It makes dogs go mad and cats also.

Mr Wight:

– Nonsense!


– Apparently, the honorable member does not live near a jet airport.

Mr Wight:

– I do, and it does not affect my children.


– Honorable members opposite think this is humorous and apparently have the opinion that they know more about it than I do. I know as a fact that extensive damage is caused to property by the vibration. One of my constituents told me some time ago that his property was valued only recently and that there was no reduction. I suggested that he should appeal to the Land and Valuation Court in Sydney, which he has done and his appeal is pending. I have advised him to persist with his appeal, and I hope that every property owner who lives in the vicinity of the Sydney airport will take similar action. This may be one way of proving the effect of the vibration on property.

Not so long ago the honorable member for Paterson (Mr. Fairhall) said that of jet planes Comets were better than Boeings. I agree with him because the Comet ascends more swiftly and with less noise. But when some one asked why we could not buy British Comets the honorable member said that the only way to sell a British plane to this Government was to substitute diamonds for rivets. That was not a pious statement, but an honest opinion and let us remember that he is an ex-Minister of this Government.

About the middle of the last century Samuel Plimsoll was advocating that a safety line should be painted on all ships as a means of preventing them from being overloaded. After about half a century that agitation bore fruit. The “ Titanic “ sank in the early part of this century, and as a result of that great disaster regulations were tightened to ensure greater safety with shipping, particularly passenger vessels. 1 wonder what must happen before measures will be taken to ensure greater safety both for plane travellers and those who live in the vicinity of airports. Must a falling plane cause injury or death in some densely populated area before big planes are forbidden to fly over cities? Unless the aviation authorities want a holocaust in Sydney, the 16-34 runway must be extended out into Botany Bay. In any case this must be done in the interests of life, limb, property and economy.


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

Minister for Trade · Murray · CP

– This is the appropriate occasion for the Parliament to review the policies indicated, on behalf of the Government, in the Governor-General’s Speech. And, of course, it is the appropriate occasion for Her Majesty’s Opposition to attempt to expose any weaknesses in Government policy, and in the administration of that policy. So we have, as is normal - and the Government feels no resentment - an attack on those policies by the Opposition - an attack couched in the form of an amendment which, technically no doubt, is a motion of censure on the Government. For this purpose the Opposition has, of course, taken a simple and pretty non-constructive course. It has chosen to get into the act on the issue of inflation - a matter that holds the public interest at the present time, and a simple one for the Labour Party to get hold of. So, before Labour speakers have been speaking for very long, they are telling the country that we are on the verge of disaster.

Well, of course, that is the Labour Party back in the groove. For ten years we have been on the verge of disaster, according to the Labour Party. So far as the present Leader of the Opposition (Mr. Calwell) is concerned, to predict disaster for the economy of Australia in the near future is merely to pop the needle back on the record where he had it in 1951, 1952 and 1953. Actually, it has never come off. The truth of the matter is, of course, that ten years of the life of this present Government have produced a period of prosperity unparalleled in the history of Australia. That is the truth, and it is a pity that the Labour Party, being the opposition to the Government, cannot be more constructive in its suggestions. It is a pity that the Labour Party should be revealed as the champion knocker of this country, for that, in truth, is what it is.

On the issue of inflation, the speeches of the Prime Minister (Mr. Menzies) have indicated an awareness on the part of the Government that there are problems of rising costs - problems that must be faced and properly dealt with. The Prime Minister has announced counter-inflationary measures taken at this point of time by the Government. I will return in a moment to the particular case of the Opposition party, but let us, in the meantime, take a look at the Australian economic scene. We are living in a period of quite phenomenal expansion and, undoubtedly, in a period of absolutely unparalleled prosperity for every section of the Australian people. There is high confidence in the present and in the future, and certainly very high confidence, in the minds of investors overseas, in the future of this country and in the economic circumstances of this country. The capital inflow to Australia, which is without precedent, is itself, of course, the indicator of the high level of confidence that we enjoy overseas.

We have had ten years of expansion, ten years of prosperity, with more homes being built annually than anybody ever dreamed could be built in a year in this country, with more public works carried out, more factories opened, more jobs. We have reached new records in primary production right across the board. We have higher wages - higher real wages - than ever before. We also have higher profits, of course. We have no shame in saying that we, who believe in private enterprise, recognize legitimate opportunity to profit as the greatest dynamic in an economy that depends on private enterprise, as ours does.

In this scene of higher prosperity for all, this Government has never for a moment forgotten the circumstances of the less fortunate sections of the community, or of the aged and of the children. And so there are, in money terms, and in real terms, better social services as an apportionment of the wealth of the community, than there ever were before. A thousand new motor cars are being registered every day. There are 800,000 television sets in use. Those are the indicators of bursting prosperity, and we on this side of the House are proud to think that these are not accidental occurrences, but are related to, and can be associated with, the policies and the administration of this Government.

All this is quite wonderful; but here I concede immediately that within a scene of such high confidence and bursting prosperity you have the very germs of the problem of rising costs. Of course, they will be there! The complete and perfect antidote to the problem of rising costs is, of course, a policy of deflation. That is the classic, the ancient, antidote to rising costs. Is that what the Labour Party wants? It is not what we want. It is not what we intend to have. We intend to sustain the measure of our prosperity, and take such action as is appropriate - as much of it as is appropriate, and no more of it than is appropriate - to curb within the proper limits, the pressure upon our costs.

Now, the problems that are associated with this phenomenal prosperity for our trade, production and wealth, are further accentuated by the Government’s policy of developing the natural resources of the country. Never before has so much money been found by the central Government for the State governments in order to enable those governments to press ahead with developing. Australia’s natural resources. The policy of full employment which this Government has constantly pursued pro- duces a pressure upon costs, and opportunities for profit making are there all the time. It is natural that, in those circumstances, while industry and business on the one hand are making handsome profits,, great pressure should be exerted by labour - a pressure that we in the Government have never complained of - so that labour itself can extract everything it can out of those lush times when earnings are high, when credit policies are geared to programmes of expansion, when our earnings from overseas are at all-time high levels, and when the capital inflow is adding to the spending capacity of the nation. I speak of industrial labour, and not of political Labour. So, we have a lot to do to satisfy the almost insatiable appetite for expansion and development that is the will and wish of the Australian people.

I concede again that pressure on costs is implicit in all this scene, and it is right that there should be an appropriate measure of worry. However, when one turns to an examination of any discussion - not only the present political discussions, but discussions by any interested group of the problems of inflation - one finds a readiness to concede the situation, but rarely does one find a readiness in anybody to concede that in their own particular sphere there ought to be an attack on the problem. This is exhibited in the amendment moved by the Leader of the Opposition (Mr. Calwell), with the classic contradictions which we have become accustomed to expect from the Labour Party.

In this debate, the Labour Party says that inflation hurts the person on a fixed income. It says that inflation hurts the exporter. True. So Labour wants that dealt with. It says that prices are too high. But when we establish some new level of competition for those who are alleged to be charging prices that are too high, by permitting a freer flow of imports, it is instantly perceived by Labour that there are interests in this country which do not want to feel the coldness that comes with freer availability of imports. To put it shortly and crudely, there are votes to be gained by being against the relaxation of import controls. So, the Labour Party, which is against inflation, is against this particular aspect of the remedy for inflation because, much as it does not want inflation, it wants votes.

This can be traced in the utterances of the Labour Party at every stage of this debate.

Of course, the level of wages is reflected in costs. Wage earners in this country have enjoyed the advantage of a 15s. increase in the basic wage during the past year, most wage earners will enjoy the benefit of the 28 per cent, increase in margins which has been awarded, and now there is an appeal for a further 22s. increase in the basic wage. Would that be inflationary, coming so quickly upon the heels of the 15s. and the 28 per cent.? Who can deny that that would add new fuel to the fires of inflation?

Where does the Labour Party stand? Of course, votes are at stake and so, much as the Labour Party is against inflation, it is in favour of it in these particular circumstances. The Opposition attacks the Government for its temerity in daring to point out to the arbitration tribunal that a further increase in the basic wage of the kind sought - coming so quickly after the other increases in wages - probably would place unbearable additional pressure upon costs. But it is not a question of what should be done to correct inflation that matters with the Opposition; it is the impact upon the voting community that counts. That may be fair enough. That may be comprehensible in the political scene. My purpose here is to expose the fact that there is this inconsistency in Labour’s declared fear of inflation and its reaction to particular aspects of inflationary pressures.

Let me revert for a moment to the aspects of the Government’s policy to which I was referring. I have said that we have pursued policies which I am proud to be able to claim have produced prosperity in Australia. I have conceded that the very circumstances of prosperity themselves contain the germs of pressure on costs. What are we to do? Are we to abandon our policy of full employment: our objective of expansion at as fast a pace as we can achieve, and our purpose of high prosperity, so that we may have the comfort of price stability in an atmosphere of stagnation? It is not the policy of this Government to avoid the problems of price pressures by embracing deflationary policies of stagnation. We prefer, and we have chosen, the more difficult course of saying that we will adhere to our policy of expansion; we will adhere to our objective of all-round prosperity and greater production, and we will face up to the problems that come with those policies.

What the Prime Minister has said in relation to the various steps that have been taken as counter-inflationary measures, represents the attitude of the Government on the problem. We will not abandon our high objectives, but will introduce into the scene such counter-inflationary moves as the circumstances of the moment demand. If we were to take the easier course and say, “ This country has had a wonderful ten years; let us rest on our oars for a year or two “, I am sure that posterity would say that we had walked out on our opportunities and that we had refused to face up to the problem in the position of high responsibility that we hold.

I have been pointing out that policies of fast expansion and the objective of prosperity generate problems. I am not to be construed as saying that we cannot have policies designed to give a high rate of expansion and policies aimed at high prosperity without having inflation. I am not saying that at all. I am saying that there comes with those policies and those objectives a necessity for modifying measures. The pressures that are generated are controllable, and can be made bearable, if there is a recognition by the whole community that the pace of expansion has to be substantially matched by continually increasing productivity. That does not mean more sweat; it means more skill in management and more understanding on the part of the entire community of the fact that, if we want our present prosperity to continue, there are certain concurrent problems that have to be met. But those problems can be offset if the whole nation recognizes the position and devotes itself to procuring constantly increasing levels of productivity. This is possible in Australia. There is a substantial and constant increase in productivity in this country but I believe that it is not evenly spread throughout primary, secondary and tertiary activity.

I am proud to be able to say that there has been a quite extraordinary increase in productivity in the primary industries. Let me quote some figures: The labour force engaged to-day in rural production is almost exactly the same as it was 40 years ago, but the volume of rural production - I am not speaking of the value - is to-day exactly double what it was 40 years ago.

Mr Daly:

– Because of mechanization!


– Of course, mechanization is one of the reasons. There have been new techniques, and we have had the advantages of scientific progress. These figures do not mean that people are working harder. They are working better. To-day the labour force engaged in rural production is 10 per cent, less than it was 20 years ago, but the volume of production in rural industry is 50 per cent, greater than it was at that time. The clip per sheep is 30 per cent, higher than it was 40 years ago, and the wool clip in total is almost double what it was then. If I could cite similar statistics in relation to transport in Australia; if I could say that the increased productivity in rural industries had been matched by increased productivity in rail and sea transport, that would be something of which we could be proud. But it cannot be said. However, this is not a farmer’s speech, and I merely say that the rural industries, one of the greatest sections of the Australian community, have shown that high productivity can enable those engaged in an industry to enjoy higher profits and higher standards of living while, at the same time, bearing the impact of very much higher costs. This is a living illustration of the fact that higher costs need not be inflationary. It is essential for this community to comprehend that increased productivity is a necessity, and for all who are in public life - whether in politics, in industry, or in business - at all times to devote themselves to this issue and to see that it is comprehended by all.

I want now to deal with a matter that has been mentioned in this debate. Figures have been quoted from various quarters which tend to show, and which, as quoted, would show, that inflation - if that is an appropriate term - or a reduction in the value of the currency, if you like, has had a greater impact in Australia than in any other country over the last ten years. In World War II. - that indescribably expensive war - forces of inflation were abroad throughout the world, and various governments adopted a variety of policy acts in order to contain those forces. There is not the slightest doubt that, in Australia, the policies of the first Menzies Government, the Curtin Government and the Chifley Government - they were substantially the same policies throughout - contained inflation during the war better in this country than in any other belligerent country. That is clearly to be demonstrated. So, in the late 1940’s, Australia had been saved from the pressures of inflation to an extent greater than in any other country, by the invoking and using of powers that were available to the Commonwealth by reason of the war. However, those powers went, and the impact of inflation began to make itself felt in this country. So, to compare the trend of inflation - I use that term advisedly - in the last ten years in Australia with the trend in any of the other Western countries is to present a distortion, because the bases were not at equal levels.

For the future, it is clear that certain things are essential to this country. The export industries must continue to expand. They are of first importance in their own right, and, nationally, the export industries - mostly the rural and mining industries - earn the overseas exchange which is so necessary for the maintenance of our level of development and our standard of living. But it is equally essential to sustain the manufacturing industries, which employ more than 1,000,000 people in this country. Here, where we have general agreement as to the need to build up the population, the majority of jobs for a greater population will be found in and about the factories. So our policies must be such as will contain costs in the primary industries - the exporting industries - in bounds within which those industries are able to compete effectively in the world’s markets. But, at the same time, we must maintain sufficient shelter for our manufacturing industries to enable them to thrive and continue to absorb employment. Here, these two things are, to some extent, in conflict, but they are manageable, and they have been managed under the policies adopted by this Government over the last ten years. I say categorically on behalf of the Government that it has always been conscious and will remain conscious, of the need to watch the cost problem .in the export industries. At the same time, it is equally conscious of the need to sustain a proper level of protection for manufacturing industries in order to enable them to continue to expand. I know that there are fears in manufacturing industries to-day that an increased flow of imports will cause trouble, but I am sure that these fears are largely unfounded.


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


.- Mr. Speaker, I support the amendment moved by the Leader of the Opposition (Mr. Calwell). Before I deal with it further, I should like to join with other honorable members in expressing the hope that our new Governor-General will enjoy his stay in Australia and that he will ultimately be replaced by an Australian-born GovernorGeneral.

Government supporters have emphatically dealt with the impact of inflation on the Australian economy, Sir. The Minister for Trade (Mr. McEwen) has complained that Opposition members have made inflation the main issue in this debate, but the extraordinary thing is that, if one looks back over the past month or so, one finds that the impact of inflation on our economy and our development has been emphasized more by members of the Government parties than by members of the Australian Labour Party.

Mr Barnard:

– It has been emphasized by the Treasurer himself.


– Yes. And it has been emphasized by the Prime Minister (Mr. Menzies), both in speeches made outside this Parliament and in his speech in this debate on Thursday evening last. As a matter of fact, some of the most damaging illustrations of the present inflation have come from honorable members on the Government side of the House. The honorable .member for Bradfield (Mr. Turner) gave one of the most effective illustrations that I have heard. On Wednesday of last week, referring to the ten years of office of the Menzies Government, he said -

Over the past ten years the value of money has been declining, on the average, at about 3 per cent, per annum. This means, ;by very simple arithmetic, that if you invest £100 to-day in government securities, in 33i years it will not be worth one bronze half-penny.

So, if there were another twenty years of the Menzies Government, an investment of £100 in government securities made at the beginning of this Government’s term would not be worth one bronze half-penny. Yet the Minister for Trade has the effrontery to accuse Opposition members of playing the role of knockers in this debate, and of chasing votes. All parliamentarians and all political parties, of course, engage in vote-catching, but they do so on the merits of their party platform. I may say that there has never been a greater knocker than was the present Minister for Trade when he was in opposition during the terms of the Curtin and Chifley Governments. There was none more vigorous.

Let me now leave the Minister for the moment and turn to the Treasurer (Mr. Harold Holt). On Tuesday last, participating in this debate, he was ungenerous enough to mention the shortages that occurred during the war and in the immediate post-war years of the Chifley Labour Government, and he dealt especially with pertol rationing and butter rationing. The right honorable gentleman knows full well, as does every thoughtful citizen of Australia, that the Chifley Government took its life in its hands by continuing petrol and butter rationing in order to assist the hardpressed people of the United Kingdom. There is no question about that. The Chifley Government’s action was humanitarian. In addition, the economy was so sound that we were able to make a gift of £45,000,000 to the United Kingdom Government.

I shall now give the House the facts concerning the situation in which the Labour Government left the country’s affairs. The Menzies Government found, when it took office, that Australia had overseas trade balances totalling £800,000,000. After ten years under the present Government - ten years of the prosperity about which Government supporters boast - at the end of December last, our trade balances were down to £547,000,000. In terms of the purchasing power of the currency in 1949, Mr. Speaker, they were worth only £273,000,000. The Government inherited a favorable trade balance of £800,000,000, a series of good seasons and a long period of peace and yet Australia has now, in currency terms of 1949, a trade balance of only £273,000,000. No wonder the Minister for Trade said in an unguarded moment the other day that the economy of Australia was poised on a razor’s edge. That is substantially true.

As I have said, I believe the emphasis that has been placed on inflation by honorable members on the Opposition side is being echoed by some supporters of the Government, not because they are worried about inflation, but because they want to influence the Commonwealth Arbitration Commission in dealing with the application of the Australian Council of Trade Unions for increased wages. I know some people will think that it is incredible until they read the Governor-General’s Speech and learn of the measures proposed by this Government to deal with the dangerous inflation which has put Australia on an economic razor’s edge.

The Government has intervened in the Arbitration Commission hearing to oppose the application by the A.C.T.U. for an increase of wages. It intervened, not in order to state a series of facts about our economic position, but to oppose point-blank any increase whatever in the basic wage. Such action is almost unprecedented. Let us consider the attitude of the Prime Minister to this matter. In a speech before the International Congress of Scientific Management, the right honorable gentleman said -

What we want is a period of quiet on the wage front.

A period of quiet! But in the GovernorGeneral’s Speech, His Excellency intimated on behalf of the Government that there are other pressures on the economy. His Excellency announced that the Government would consider measures to cope with those who operate monopolies and indulge in restrictive trade practices. The Prime Minister is now openly opposing an increase of wages, but he had other views in 1954, as I shall show. The right honorable gentleman never hesitates to attack the wage and salary earners. Applications to the arbitration tribunals of this country affect not only manual workers, but also clerical workers, salaried officers, bank officers and many others whose remuneration is fixed in relation to what is granted to manual workers and artisans. In May, 1954, the present Prime Minister, when referring to a proposal by Dr. Evatt, who was then the Leader of the Opposition, said -

He goes further-

The right honorable gentleman was speaking of Dr. Evatt -

He has recently permitted a belief that he undertakes, if he becomes Prime Minister, either to persuade-

And I emphasize the word “ persuade “ - or to compel the Arbitration Court to decide in favour of the unions. This is deplorable. Do you want an independent court or one that can be ordered around?

To-day, the right honorable gentleman is virtually in the Arbitration Court to persuade the court and so to do the very thing for which he condemned Dr. Evatt. That is the reason for the attack on inflation by supporters of the Government. They want to influence the Arbitration Commission. The right honorable gentleman wants to persuade this tribunal of competent, welltrained men not to grant an application by the unions for increased wages.

Does the Prime Minister believe that the judges who sit on the commission are not trained sufficiently well to be able to decide whether or not they should grant an increase in wages on the application of the unions? The right honorable gentleman has always said that the judiciary is sacrosanct. The members of the judiciary have trained minds. When a proposal was made some years ago to give this Parliament industrial powers, the Prime Minister raised his hands in holy horror and said that it was an attempt to remove from the jurisdiction of the Arbitration Court the right to judge impartially whether an increase in wages should be granted or not. When the Prime Minister announced his intervention in the current hearing, he said -

As we have often made it clear, it is not our policy t’o oppose wage increases as such-

What “ as such “ means I do not know - but our strong present belief is that, having had two major wage increases within a period of a few months, the economy needs time to absorb them and to restore the equilibrium between supply and demand which has been disturbed.

Has the right honorable gentleman any respect or consideration for the capacity of

Mr. Justice Kirby, Mr. Justice Gallagher or Mr. Justice Foster? Has he read their judgment in which they granted an increase of wages in May, 1959? Each and all of them said at that time that, in their opinion, an increase was justified. They differed as to what the increase should be. One said 5s. or 10s.; another said 15s. and the third said £1. Finally they compromised at 15s. and they gave good judicial reasons for their decision. Now the Prime Minister has set out to intimidate the judiciary. He has intervened in the hearing, not just to state facts but actually to oppose an increase. That is the very reverse of his attitude in 1954.

The Prime Minister has admitted that a crisis is facing Australia. It has resulted in the dangerous state of affairs postulated by the honorable member for Bradfield. In a similar situation in 1932, after a long conference between the State Premiers, it was suggested in the Parliament of Victoria that wages should be reduced to meet a crisis which, incidentally, was largely caused by the Bruce-Page Government. It was suggested that wages should be reduced by 2i per cent, on the lowest scale and by as much as 221 per cent, of the salaries of higher-paid officers and public servants. The present Prime Minister protested. He wanted a flat rate of reduction - 22i per cent, of the earnings of those on the basic wage and 22i per cent, of the income of those more fortunately placed. He did not get away with it, but that was his attitude.

Referring to the judges of the Supreme Court of Victoria, who were to suffer a reduction of 22± per cent, in their salaries, the right honorable gentleman said then, in effect, “This might tend to interfere with the handing out of even-handed justice by the judiciary”. I wanted to know what the reduction would mean to the man on the end of a long-handled shovel. The right honorable gentleman said on the same occasion, when interest on private mortgages was under consideration, “ You can no more force down the rate of interest that will be paid on private mortgage than you can force the sea back with a broom “.

Mr Anthony:

– You are all over the place.


– The honorable member for Richmond was all over the place the other night; he always is. Look at the facts. What has this Government done to halt inflation? In 1951, the Government said we had entered an inflationary era. It was going to do something about it. Sir Arthur Fadden was the Treasurer and he said this in his Budget speech -

During the post-war period, it has become increasingly evident that, in many sections of commerce and industry, the pressure of purchasing power has raised business profits to inordinate levels. To a large degree, these profit increases are not the gains of normal business enterprise and activity but the direct result of high prices for commodities in strong demand. In their turn, increased profits add to the strength of the forces of inflation.

As part of an organized and balanced plan to bring these inflationary forces under control, measures are under consideration to draw off some part of the abnormal profits.

What did he do? Nothing, except to impose a 20 per cent, deduction on the gross incomes of wool-growers. He did not lock the 20 per cent, deduction in a safe and say, “ That money is not to be used in this inflationary period “. As fast as he took it from the wool-growers, the Government spent it. He did not place any restrictions whatever on the people whom he said in his Budget speech were enjoying abnormal profits. And so it is again today. A direct attack is to be made on the wage and salary earners, but we have only a promise that consideration will be given to the activities of monopolists and those engaged in restrictive trade practices. Let us look at what is happening. An advertisement in a newspaper said -

Share the profits from the only investment that beats inflation. This graph shows how only land values rise above the cost of living increases.

The graph has a base of 100 in 1945. The black line shows that land values since 1945 - and also since 1949 when the country has been in the hands of this Government - have risen to 400 per cent. Shares and the cost of living have not risen nearly as much. I may ask to have this graph incorporated in “ Hansard “. However, for the moment, I shall proceed. The company inserting this advertisement is supported by no less an individual than Sir Arthur Fadden, who was the Treasurer and who prepared the 1951 Budget speech. The advertisement continues -

Australian Land & Building Trusts,

No other unit trust offers all these opportunities.

8 per cent, per annum estimated income, dividends payable half yearly

Big Capital Gains

Solid Tangible Security

Readily negotiable for cash

Your funds are not “ frozen “ in long-term commitments like Debentures, Notes, etc. Invest now in Land Trust No. l.v. 5/- per unit.

Sir Arthur Fadden’s photograph appears and he is described as the chairman of the Federal Board, Australian Land-Trusts Proprietary Limited. Let us follow this a little further. Less than six weeks ago, at Sunshine in Victoria, a paddock containing 540 acres was sold. It would carry about a sheep to the acre. It was sold for £500,000, and it was given this added value because this Government has not done anything of an effective nature in the last ten years to halt inflation or to hon our the promise made in the 1951 Budget. Not one penny of taxation is payable to the Commonwealth on the £500,000 realized by the owner of the land. On the subsequent transactions, L. J. Hooker Limited and others will make profits, but not one penny will come to the Commonwealth. At Blackburn recently, 84 acres were sold for £251,000. This was formerly orchard land worth about £100 an acre. When roads and services are provided, the unfortunate home builders will pay approximately £1,500 for each block. The original seller will not pay any taxes. Hooker and Company, who bought the land will not be required to pay anything to the Commonwealth.

These land trusts deal in units at 5s. each. How many workers will be able to buy units? Millions of shares will be bought by people who are already in this giant game of speculation. They are inflating values, but they do not create any real wealth. They do not produce a solitary article. All they do is juggle with the money that belongs to the people. They have stepped in and taken over the operations of the State Savings Bank and of the Commonwealth Bank of Australia. The trading banks, of course, have been given licences to enable them to engage in savings bank activities. But the bulk of the people’s money in this inflationary era is going in an endeavour to buy building blocks for homes at prices that have been inflated by these land trusts and by these people who have influence with the Government. Their activities are staggering people who think about them. Mr. Trickey, of the Melbourne and Metropolitan Board of Works, had something to say on this subject. According to an article published in the Melbourne “Sun” of 12th March, 1960. he said -

Speculation, super-salesmanship and massive publicity campaigns are causing this boom. People can buy land on as low a deposit as £10 and they are blinded by this.

If we rezoned more land for residential purposes it wouldn’t make any difference.

The article commented -

Mr. Trickey’s statement is borne out by the fact that in the metropolitan area there are at least 38,000 vacant blocks of land, all provided with water; 10,500 also have sewerage available.

  1. J. Hooker Limited engage in this land speculation and produce nothing. They use their brains to juggle money and the Government sits by completely impotent. The Government does nothing but grizzle when we accuse it of mismanagement. How long will this state of affairs continue? I referred earlier to the statement made by Sir Arthur Fadden in his Budget speech in 1951, but one would think that the statement I am about to read was made only yesterday. In fact, it was contained in the Melbourne “ Age “ of 25th January, 1951 It is- is disturbing in our present trend is the lack of any provision to apply effective brakes to the process. We seem fated to witness an endless alternation of reciprocating pressures, constantly forcing the spiral upwards, while wages and salaries seem to lag chronically behind living costs.

The same sort of comment is being made by the press and by honorable members opposite to-day. The Government does not take any notice of what we say, but I hope that it will take some notice of what its friends say - and they were saying this in 1951. The irony of it all is that, if we lived completely within the ambit of our own economy, perhaps we would have been all right. But the Minister for Trade (Mr McEwen) of all men knows where the ultimate impact of all this dreadful situation is. The cost of production has been forced to higher levels all the time. The former cost of production of butter in Australia was 2s. 2d. per lb. in 1949 under the late Mr. Chifley; it is now 4s. 5d. per lb. and indeed we are selling it on the London market at about 3s. per lb. The cost of production of a bushel of wheat in 1949 under the late Mr. Chifley was 7s. Id.; to-day it is round about 14s. and on this year’s exports the Government will probably be confronted with the need to pay the Australian Wheat Board about £10,000,000 to meet the loss. Yet the Minister for Trade abuses the American Government because it gives wheat away or does something else. It gives wheat in a humanitarian spirit. The real villians of the piece are the men of responsibility who have guided the destiny of this country for the past ten years and have allowed the cost structure to increase until we can no longer compete effectively.


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

Minister for Territories · Curtin · LP

– Before moving on to more controversial matters, I should like to associate myself with those members of the House who have on this occasion expressed their pleasure at the arrival of the new Governor-General and have expressed their wishes that he and Lady Dunrossil have a very happy stay in Australia and add even further lustre to the high office that they occupy.

The subject we are discussing is the Address-in-Reply and, to the motion for the adoption of the Address-in-Reply, the Leader of the Opposition (Mr. Calwell) has moved an amendment which is phrased in such a way as to suggest that the subject of inflation is something of major importance in the country to-day and a subject to which Parliament should devote its whole attention. My colleague, the Minister for Trade (Mr. McEwen), said early in his speech that inflation was a subject which held the interest of the people of Australia; and that, of course, is true, because the people of Australia are affected by inflation in their happiness, in their homes and in their general welfare. But it is a strange thing that although inflation may hold the interest of the people of Australia, it does not seem to hold the interest of the Labour Party.

Only a little over a week ago the Leader of the Opposition moved this amendment, and he spoke in terms which represented inflation as being so serious that we were required to view it with feelings of alarm, with the utmost concern and the greatest anxiety. He suggested that it is the sort of conflagration which would require us to call out the fire brigade, summon the ambulance, get the police on the job, call the demolition squad, and even put the Constitutional Review Committee to work, and then as a last resort call up the Deputy Leader of the Opposition who has had the unhappy fate of becoming the white hope of socialism by a majority of four votes. That was a week ago. To-day, the Opposition, still concerned with this amendment which was presented as one of such great urgency, is having difficulty in finding speakers to support it. It was very refreshing to hear the honorable member for Lalor (Mr. Pollard) because he spoke with some feeling, intensity and eloquence about the subject to hand. Only a few moments ago the honorable member for St. George (Mr. Clay), valiant against the dragon of inflation, spent most of his time speaking about the noisiness of modern aeroplanes. Certainly, he finds no ground for complaint in the noise on that side of the House about inflation; there is a deadly quiet there, and scarcely a word on this subject which honorable members opposite represented as being of great urgency.

I have listened to this debate with a great deal of interest and a great deal of care. Only this afternoon, with the liveliest of anticipations, having looked at the list of speakers, I came into the chamber to hear the honorable member for Grayndler (Mr. Daly). Where was he? A substitute speaker took his place and talked quite usefully, perhaps, but talked on other subjects. So a week has passed. The revitalized Opposition, the fighting Opposition, cannot find speakers to sustain an amendment which a week ago it was representing as the most important amendment it has ever moved and one designed to deal with one of the most serious situations Australia has ever faced. That is the fact.

Every member in this House knows that speaking lists are arranged and that we match speakers from one side with speakers on the other side. Last night the Opposition secured the adjournment of the debate, and the people of Australia might well have tuned in this morning, and turned their radio knobs thinking that on the resumption of the debate they would once again hear the voice of Labour. But there was no voice of Labour to take up the debate. A Liberal speaker had to fill the breach. On four occasions when Labour speakers have been set down on the speaking list there has been no Labour speaker forthcoming in order to tell the story which was represented as one of great urgency. Where is the fighting and revitalized Opposition - this Opposition which is mumbling through the gaps in its teeth - is that a fighting Opposition? Its members have no teeth. When they smile they just reveal how many of their members are missing. When they try to fight they have nothing to bite with.

Having said that, I want now to go back to the speech made by the Leader of the Opposition when he moved this amendment. In the first place, I find a conflict between what the Leader of the Opposition said and what was said by the Deputy Leader of the Opposition. The honorable member for Melbourne talked of inflation, as I have said, as an extreme threat and as something which would be of great concern to the nation. And he spoke of the Government’s alleged inability to take the proper economic measures to curb inflation; and there is a certain consistency in that. One can see the point he was trying to make, even if one does not agree with it. But then the honorable member for Werriwa tried to score a point - and perhaps he was only concerned with scoring a point, and not with saying anything of relevancy - by speaking of inflation as though it were the invention of the Government. He used the words “ a very deliberate campaign “, and “ a most improper campaign in an attempt to bring pressure to bear on the court “. So, on the one hand we have the Leader of the Opposition saying that this is a most urgent situation, this is something of vital national concern; and on the other hand the Deputy Leader of the Opposition saying that exactly the same set of circumstances is only the result of some sort of campaign conducted for publicity reasons by the Government.

Then the Leader of the Opposition went on to attack the Government for its alleged failure to halt inflation; and again I can see and appreciate his point of view. He launched his attack with vigour and eloquence and said that the Government was wrong for not having attempted to halt inflation. Then he also went on to attack the Government for certain actions which would halt inflation. To take that line of argument, to say that we were wrong to do nothing about inflation and then to say that we were wrong because we had done these things about it, could be understandable but not respectable in a private member who had no responsibility and who was only trying to score a point which might go over well, or only trying to say something which might make a paragraph and might be repeated to the disadvantage of the Government. That is quite understandable in a private member but surely in the Leader of the Opposition who puts himself before the people of Australia as an alternative Prime Minister - the leader of a party which puts itself before the people as an alternative government - we expect something more than the scoring of points. Surely, we expect that leader to develop a consistent policy. If his attack on the Government is to be taken as an indication of his policy and that of the party for which he speaks, presumably if he were in power he would not lift import restrictions. He would not take that measure to check rising prices. He would not concern himself in any way with the other pressures which are adding to the spending power in the community and which are having an inflationary effect.

So I ask: Does the three-pronged motion which the Leader of the Opposition has submitted, mean that if he were Prime Minister to-day he would work to add still more to the purchasing power of the people, and restrict the supply of goods, and that in doing so he would imagine he was halting inflation? If we analyse his speech further, does it mean that if he were Prime Minister he would only deal with inflation - and this is the one positive element in his speech - by embarking on a campaign to induce the voters of Australia to give the Commonwealth greater powers so that he could use them in some vague and unspecified way? In short, Mr. Speaker, it seems to me that although this amendment was put forward by the Opposition to express lack of confidence in the Government, up to date it has only been successful in demonstrating how completely foolish it would be to repose any confidence at all in a government led by the present Leader of the Opposition.

Turning from a criticism of the speech of the Leader of the Opposition, I would like, in the time remaining to me, to invite consideration of the situation in Australia to-day. I would ask you, Mr. Speaker, and honorable members whether we have not been inclined to exaggerate in this debate when talking about the existing conditions in Australia. With the greatest respect to colleagues on both sides of the House, I would suggest that some of the language that has been used when talking about inflation has been rather immoderate. Sitting in this chamber I have even heard references to the French revolution. I have heard inflation, as existing in Australia at present, described in the most extreme terms. I would suggest that we have exaggerated a little.

Every thinking person in Australia knows that inflationary forces are at work, and that inflationary forces have been at work in Australia ever since the war. Every thinking person knows that some of those inflationary influences spring from conditions outside Australia, while others are derived from conditions within Australia. But what is the change that has recently taken place to attract attention to this topic in a way in which attention was not given to it. say, six months ago, although the Government has been pursuing a steady course directed towards achieving stability in prices? What has happened in the last few months that has resulted in the Opposition proposing this amendment?

There has been a rise, commencing in December of last year, in wholesale prices. It has been quite evident that the rise has occurred in those prices which are affected by internal influences rather than in those affected by external influences. But while we recognize this as one of the facts of the situation, and while it is a fact that should cause us concern and require any responsible government to be careful and watchful, there are, on the other hand, quite a number of hopeful factors which we should not forget.

The employment position throughout Australia has been quite strong, and it is still strong and becoming stronger. Industrial production is rising. The rural outlook gives us promise of a very good export year. On the other hand, we have the rise in prices and we have the pressure of an increasing demand, which is due partly to higher export income, partly to increases in public expenditure, partly to inflow of capital and partly to recent increases in wages and salaries. At the same time we see in the community to-day an increased liquidity which, with the rise in prices, is something which should warn any careful and responsible government to watch the position carefully. But while those circumstances are sufficient to require us to take care - and I do not propose to weary the House by citing figures, because honorable members will be familiar with most of the figures - they are certainly not such as to induce a state of alarm or panic. Basically, I believe, the condition of Australia is healthy. The situation with which we are required to deal now is not vastly different from the condition with which the present Government has dealt successfully during the past ten years.

Every honorable member knows that during the last ten years we have been going through a period of continuous economic difficulty of one kind or another. Some sneering references have been made to the phrase that has been used, describing the economy as being balanced on a knifeedge. But that is a very exact description of the state of Australia’s economy during the past ten years. We could have toppled over on one side; we could have toppled over on the other. Happily, due to the energies of the Australian people, the wise direction of Australian industries and, I believe, the wisdom of the Australian Government, we have not toppled over on either side but have maintained stability.

The Leader of the Opposition, in his contribution to this debate, devoted his attention very largely, when he was dealing constructively with the question, to the matter of powers. If only the Commonwealth could be given more powers by a referendum of the people, if only the Constitution could be changed and the Commonwealth had more powers, then inflation could be tackled! That is a rather remote remedy, and, moreover, I doubt whether it is a complete one. I would suggest that some of our difficulties to-day do not arise from the fact that the Commonwealth has not full powers to do such things as regulate prices or to curb hire purchase. Even if we had the powers, I think there would be two opinions as to how they should be used. But part of the difficulty to-day is that there are certain factors influencing the economic position of Australia which are completely outside the control of any Commonwealth Government. I hope 1 shall not be misunderstood and considered to be criticizing either of the two bodies when I refer particularly to the Tariff Board and the Arbitration Commission.

I want it to be understood quite clearly that I am not advocating either tariff-fixing by the Government or wage-fixing by the Government. I believe it is basically a wise decision to place such matters beyond daybyday political controversy. But I want to point out that in the Tariff Board and the Arbitration Commission we have two bodies acting independently and capable of making decisions having profound influences on economic conditions in this country - and those decisions, quite properly, are not directly influenced by the Government itself.

The recommendations of the Tariff Board on the question of protection and the decisions of the Arbitration Commission on the question of wages do have economic consequences. They are, to a very large extent, beyond the control of the Government, and yet the Government has to deal with the situations which are created as a result of those decisions. My own line of thinking is in the direction that we should not try to alter the system, but we must rely on those two authorities to act with wisdom. We must ensure that they are aware of the economic consequences of any actions they take, and we must ensure that they are soundly informed about the situations with which they deal. That is the whole case - and a reasonable case - for placing evidence before the Arbitration Commission when a major question, the decision on which will have economic effects, is under discussion.

I think we can fully justify the action of the Government in intervening before the Arbitration Commission in the present basic wage application, because such action will help the commission to reach a decision while more fully informed and with a more complete understanding of the economic effects of its decision than it would otherwise have.

Mr Ward:

– That is not the Government’s purpose; it is to keep wages down!

Mr Cash:

– Who is making this speech?

Mr Ward:

– I am delivering the best part of it.


– That is one of the many delusions which the honorable member for East Sydney nurses. It is not the only one, but it is one of the many delusions he nurses. I will not touch on the other ones.

There is a third problem facing the Government to-day when it is trying to achieve the best results with its economic decisions. This comes from restrictive practices within trade and industry itself. Some reference was made to this in the Governor-General’s Speech. In the time remaining to me I shall speak very briefly on that particular matter because it is of concern, not to socialists, but to Liberals and their supporters. If we, as Liberals, reject the idea of price control, and if we reject the ideas of coercion which are so dear to the socialists then, as a corollary, we depend very much on the free operation of competition.

We depend very much on the interplay of supply and demand, on the incentive to higher productivity and higher efficiency in industry, and on the operation of intelligent and active competition both among producers and among customers. Any interruption of these basic conditions in Liberal economic thinking is a direct and dangerous assault on the whole purpose of liberalism, and on the capacity of liberalism to deal with the economy of the nation. Restrictive trade practices, monopolies that operate to kill competition, mechanisms that interfere with the free choice of the customer, private price-fixing arrangements, and all that sort of thing, are even a more dangerous challenge to the success of the Liberal theory of the economy than socialism which, these days, is largely a discredited philosophy in economic matters. These practices complicate the problem of government when government tries to act wisely and, on the other hand, they interrupt the distribution of the benefits of prosperity.

The final thing that I wish to say is that the Government is aware that there are inflationary tendencies in the community. Over the past ten years it has continually shown its capacity to deal with the changing situation and to deal with it firmly and successfully. In the present situation, the Prime Minister (Mr. Menzies) has already announced four measures. The first one is to avoid large additions to the demand arising from increased purchasing power. The second is to avoid deficit finance and therefore to curb excessive public expenditures. The third one is to restrain excessive liquidity and the fourth is to increase the supply of goods by relaxing import controls. In addition, we have pursued constantly the aim of increasing productivity. These policies depend for their success on the free operation of competition in the community.

Summing up, I think that, in this debate, we have exaggerated more than a little the present inflationary conditions. We cannot disguise, nor should we in any way ignore or underestimate, the inflationary influences that are at work. But with a knowledge both of the past and the present I think we can have confidence that it is within our capacity as a nation, under the present Government, to deal with that situation, and deal with it successfully.


.- Mr. Deputy Speaker, at the outset I wish to endorse the remarks that the Leader of the Opposition (Mr. Calwell) made with respect to the Royal Family in recent events and also to their representative here, in Australia. The debate on the Address-in-Reply has produced some remarkable results. I want to pinpoint two or three of them in my speech to-night. First, I refer to the speech made by the Prime Minister (Mr. Menzies) one night last week in defending himself against this no-confidence motion. After speaking for about 21 minutes he looked at the clock and said, “ I have eight and a half minutes to go. I must tell you something about our policy.” But he continued to attack the Labour Opposition and spent only three or four minutes of his half-hour in telling us something about his policy.

Another matter to which I wish to refer is the vulgar splurge that we heard last night from the Minister for Social Services (Mr. Roberton). It was not fit to be recorded and ought to be expunged from “ Hansard “. It certainly did not do credit to a Minister of the Crown in this national Parliament in Canberra.

The Minister for Territories (Mr. Hasluck), at the commencement of his speech, indulged in many cheap sneers at members of the Opposition. Here, again, one is at a loss to understand why he had to resort to such tactics. Perhaps it was to camouflage the many shortcomings of the administration of his Government, and the many attacks made on it by members on his own side of the House. A glance at “Hansard “ will show that Government supporters have attacked their own Government’s administration as much as it has been attacked by members of the Opposition. The only difference is that the language of members of the Opposition is direct and forthright, whereas the language of Government supporters is honeyed and their criticism expressed in give-and-take verbiage.

Notwithstanding the attacks that some members opposite have made on the Government, a few of them still say that the Opposition has no right to criticize the administration of the Government. I say that the duty of an opposition is to analyse and criticize. That obligation is a vital requirement in our parliamentary system. Only by the free and unfettered expression of viewpoints can we maintain the principles of democracy in our parliamentary institution.

In the time at my disposal I intend to traverse the points contained in the amendment moved by the Leader of the Opposition. The first charge levelled against the Government administration is in respect of-

Its failure to halt inflation with its adverse effects on wage and salary earners, on pensioners, on persons on fixed incomes, on primary producers and on homebuilders, particularly those with young families;

First, let us consider the wage and salary earners. Since the Arbitration Court abandoned the “ needs “ principle, the workers have been forced, over the years, to chase the higher cost of living by applications to tribunals and other processes available to them. The formula followed by the court to-day is broadly based on the ability of industry and commerce to pay. Before the workers can receive increased wages it has to be proved to the court that industry and commerce can pay. But the breadwinner is always faced with the realities of the situation. The paramount question for him is the purchasing power of the money token that he receives.

At this point we can highlight the great failure of the Government to take action to maintain the standard of living and to level and stabilize the economy of our nation. The Government has had several processes open to it, but it has failed and failed miserably. Because of this failure, trade unions, associations and societies are forced to engage in costly court proceedings to try to restore the. purchasing power of the £1 in order that their standards of living shall not further deteriorate. It is not a hungry, insatiable greed which motivates this action, but the simple law of self-preservation for the worker and his dependants.

Now, let us look at the next group affected by inflation, namely pensioners and persons on fixed incomes. Because they are not a strong, organized body, they have little influence on the Government. They can only raise their voices in protest. In their protest the Labour movement willingly joins. What a disillusionment it has been for many thousands of people now at the age of retirement who, in their early lifetime set out to provide for their old age so that they might have security and contentment in the sunset of their lives. They have been sadly disillusioned because of the effects and processes of inflation in our economic life and society. They have every reason to feel aggrieved, because the Government has taken no steps, apart from an occasional miserable handout to the pensioners, to right this wrong and give to this section of our community that which belongs to them - a stable purchasing power for the money they have in their keeping for security in their old age.

The irony, of course, is that the Labour Government is not on the treasury bench to correct this wrong and restore to this very important and honoured section of our community, which- pioneered this country and substantially made it what it is to-day, the value which their money should have. The answer of the Government to these people is a complete disregard for their requirments and just rights. Despite warnings from all sides, the creeping paralysis of inflation still goes on. But the Government is unmoved and takes no action to bring relief or to provide protection for those who need it. Because of this, the Government stands condemned in the eyes of all fair-minded people.

Now, let us look at the condition of the home-builder. A few years ago he had every expectation of realizing his ambition, but to-day the situation is completely changed. The first requirement, of course, is a block of land on which to build. In years gone by a man could obtain a block of land at a reasonable price a few years in advance of his marriage. To-day, due to the unbridled speculation in land and the inflationary trend, the cost of a block of land within a reasonable distance of a town or city is from £1,000 to £2,000, and in many cases more than that. How can the ordinary breadwinner of a family hope to pay that exorbitant speculative price and on top of it hang round his neck a burden of mortgage and interest which will keep him a prisoner for the rest of his natural life? These are some of the things for which we censure and condemn the Government. It needs only sickness or an accident to place a breadwinner in a hopeless financial position. This means that he cannot afford to get sick or have an accident. If he does, he becomes financially embarrassed and has to suffer all the miseries and anxieties of the financial disability which surrounds his home life. Creditors begin to press him from all sides, simply because of something which has happened over which he has had no control. It is one of the speculative things of life to be involved in an accident or to fall sick.

It is useless for members on the Government side to talk about the home being the corner stone of our society if it is not prepared to take the necessary steps to make sure that homes are available - to those who need them. When all these barriers are allowed to exist in the way of the home owner or the family man, particularly young married couples striving to rear a family, then the Government is not fulfilling its obligations or doing its duty by them. Perhaps there are some unpleasant steps which should he taken by the Government, but it should have the courage to take them because the greatest good of the nation is involved. No one can logically deny that the present creeping inflation is a profit inflation. This, reduced to simple terms, means that the rich get richer and the poor become poorer. An examination of all the factors reveals the truth of this claim.

We pose the question: Has the great mass of the people received a fair share of our much-vaunted prosperity? And the answer is that they have not. On the contrary they have to engage in a struggle to maintain their standard of living and in some cases, their very existence. I am more concerned with the practical and humanitarian considerations involved in this question of inflation. It is completely meaningless and futile to try to comfort an unemployed breadwinner with the information that the unemployed represent only 1.7 per cent, of the work force. Theoretically that sounds good, but it does not feed hungry mouths or develop human personality and dignity - qualities so necessary for human society.

I have now traversed the first of the Government’s sins of omission, and now I turn to a brief consideration of the second charge made in the amendment, and that is -

Its action in lifting import restrictions, with its accompanying threat to the employment of thousands of Australians and the security of Australian enterprises.

Like many other things, the lifting of import restrictions, in itself, is not a crime, but if it brings with it grave consequences for the nation, then it becomes a matter for serious consideration and action. The Labour movement sees in an increase of imports a real threat to the employment of thousands of Australian workmen. This is not an irresponsible conclusion, but one based on experience. Even during the lifetime of this Government, we have had that experience. In 1953, when import restrictions were lifted, there was a flood of imports and a consequent rapid rise in unemployment - so much so that the Government found it necessary to reimpose the restrictions. It had no other means of stemming the rising flood of unemployment. Are we to look forward to a repetition of those events? Will this Government be forced to take similar action again in order to reduce the vast army of unemployed, which to-day numbers about 60,000? The existence of that rate of unemployment is itself a blot on the administration of the Government. It is a blot on the structure of our society that we allow 60,000 breadwinners to go hungry, apart from the mere pittance of social services, when this country is crying out so loudly for national development and expansion, and for more population.

We are told that the lifting of import restrictions will not affect employment. I remind the House of the urgent plea by the honorable member for Indi (Mr. Holten) for the Government to do something about the threatened dismissal of employees of the Bruck mills at Wangaratta. He said that unless the Government took some urgent action almost all of the employees would be thrown out of employment. There is a challenge to the Government.

The Government should not be wasting its time asking the Opposition what it is going to do. We are not in office. The Government should be telling the House and the nation what it is going to do, because it is responsible for governing this country. If the Government stands idly by and allows commercial interests so to fashion their activities that thousands of good Australians will be thrown out of employment, then the Government is deserving of the strictest censure.

I now turn to the final reason given in the Opposition’s amendment for the lack of confidence in the Government by the Parliament and the nation. It is -

Its decision to ask the Arbitration Commission to reject the current application of the trade union movement for an increase in the basic wage.

It is here that the outlook of the Government is starkly revealed. This is one case in which the Government cannot camouflage its intentions. It now wants to freeze the wages and salaries of hundreds of thousands of workers as an alternative to its fruitless previous efforts to stabilize the economy. In 1953 the Government approved the freezing of cost-of-living adjustments to wages, and told the people that that would stabilize the economy. History shows that it did nothing of the kind. Prices continued to rise, profits continued to rise, dividends and bonuses continued to rise, while the purchasing power of the worker’s pay envelope continued to deteriorate. The net result was that wage and salary earners were the only section of the community who made any sacrifice on the altar of economic stability. Their sacrifice was in vain, because the Government refused to call on the other important sections of the community to make an equal contribution to stabilizing our economic life. The consequence is that a gradual, creeping, paralysing inflation has been asserting itself since that time. Yet the Government still stands idly by and asks the Opposition, “What are you going to do about inflation? “ What a miserable camouflage for a government charged with the grave responsibility of keeping our economic and social life, and our society, on an even keel!

It seems now that the experience of 1953 is to be repeated. The Government still does not indicate whether it proposes to do what it failed to do in 1953 - that is, take steps to bring all sections of the community into line. On this particular aspect, it is interesting to quote from the report of a statement made by the Governor of the Reserve Bank of Australia, Dr. H. C. Coombs, in a recent lecture in Adelaide. The report reads -

Management could make a positive contribution in the field relating to price and cost policies of business organizations. It was clear that for a wide range of goods throughout the economy prices were determined by management rather than by market forces.

This had developed with, the emergence of strong monopolistic elements in our economy.

These were characterized among other things by “ gentlemen’s agreements “ on price policies and successful takeover bids.

That is a telling statement by one of Australia’s leading authorities in the banking and commercial world. As such, it carries much weight and should be heeded by this Government, which should act to curb the dangers mentioned by Dr. Coombs. Dr. Coombs went on to describe how smug financial affluence discouraged the need for new techniques which could considerably lower the cost of production. He further claimed that there was considerable scope for price reductions in many fields of production and distribution. These claims by such an eminent personage should be noted and acted upon by the Government.

I regret, Mr. Deputy Speaker, that time prevents me from discussing other aspects with which I intended to deal. I conclude my observations by summarizing them. The Opposition charges the Government with its many failures of administration; with its failure to halt inflation, which is a profit inflation, proved beyond doubt; with its failure to protect pensioners from the ravages of falling money values; with its failure to protect superannuated people and people on fixed incomes, while business and commercial organizations have greedily skimmed off unheard-of profits; and with its failure to protect primary producers adequately from cost and profit inflation. For those reasons, I firmly support the amendment moved by the members of the Opposition.


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


.- The honorable member for Adelaide (Mr. Sexton) said, among other things, that the Prime Minister (Mr. Menzies) and the Minister for Social Services (Mr. Roberton) each devoted his speech to criticism of the Opposition. Yet he himself has devoted all his speech to criticism - not even constructive criticism - of the Government. He excuses his action by saying that it is the Opposition’s place to criticize. Sir, it is also the Opposition’s function to state an alternative policy.

Mr Calwell:

– Who told you that?


– We have been trying to tell you for some time, and the people of La Trobe, for instance, are still awaiting a statement of Labour policy regarding inflation, as we in this Parliament have been waiting for it since this debate began. The honorable member has said that inflation has caused the workers to battle to maintain their standard of living. Such a charge needs no answer. The people of Australia know, as does the honorable member in his heart, how well off we are. I shall speak of these things later.

I support the remarks of the honorable member for Herbert (Mr. Murray), who so ably proposed the motion for the adoption of the Address-in-Reply. The honorable member’s electorate shares many characteristics with the northern part of my own, and I commend him for his vigorous approach to some of the problems which affect the future of the north of the continent. Now that a large area of the north is represented by Liberal members, who subscribe to a policy which is consistent with the needs of the north, I am hopeful that an increasing number of steps will be taken towards its development. My colleague from Herbert and I are aware that the north is the future larder of Australia and South-East Asia. Perhaps I should have said “ or South-East Asia “. Those engaged in the cattle and sheep industries are becoming increasingly aware that not only may modern management techniques be used in the north, but also that they must be used. Graziers and pastoralists are now conducting experiments with a view to increasing the carrying capacity of the country. I look forward to government participation in such experiments which, I am sure, will lead to vastly increased productivity for millions of acres which to-day are waiting to produce untold wealth for Australia.

Last year I discussed with the honorable member for Macarthur (Mr. Jeff Bate) my belief in the north as a future agricultural area. As a result of this discussion, the honorable member led a party of Government members on a tour of the northern half of the electorate of Kalgoorlie, from the Kimberleys to the Gascoyne River. I am indebted to those honorable members for taking that opportunity to inform themselves of the nature of the north and of some of the difficulties associated with its future. I think that they all returned sharing in my belief that Australia’s future lies in her northern area. They learned facts about the north which should be passed on to people in the southern States and in the capital cities - facts which will encourage the people of Australia to support actively the case for development of the northern part of our country. For instance, the people should be told that the Ord River, one of the greatest rivers in Australia, is pouring water into the sea at the rate of 10.000,000 gallons a second, and that one of Australia’s most intensively cultivated areas is on the Gascoyne River 600 miles north of Perth. This area already has produced millions of pounds worth of goods, and its future depends on the conservation of the water of the Gascoyne River.

The honorable member for Macarthur saw fit to devote his speech during the debate on the Address-in-Reply to the need for the development of the north of Western Australia. I congratulate him on his speech, and on his national outlook which prompted him to direct attention to some of the matters to which I have referred, no doubt thereby neglecting pressing problems within his own electorate.

While on this subject I must protest at the attempt which has been made by the Leader of the Opposition (Mr. Calwell) to use the north as a political football. In a recent television interview in Perth he said that if the Labour Party came to power under his leadership he would spend at least £60,000,000 on the north.

Mr Chaney:

– Why did he pick that figure?


– It is a figure which always has good publicity value. Not only did he make this statement without any knowledge whatever of the north, but he made it also without any regard for the plans of the State government for the development of the area.

Mr Reynolds:

– He visits that area practically every year.


– Well, he does not do me the courtesy of telling me. I suggest that the figure of £60,000,000 was selected at random from the jumble of astronomical figures which seem to enjoy the exclusive occupancy of the honorable gentleman’s mind when he is making election promises. I make this protest because promises of this kind, which are rash and ill-considered and which assume their auditors to be complete fools, can do nothing but harm to the faith of those who already are tackling with energy and experience the problems associated with the development of the north - people who know that private enterprise is the only system which has a hope of success in this area.

Now I come to a question which is of vital importance to Western Australia as a whole and to Australia generally.

Mr Duthie:

– Do you not want Government money spent there?


– Yes. we want it spent but we do not want it to be promised without a prospect of the promise being fulfilled. I wish to deal now with the embargo on the export of iron ore. This matter has received lately the urgent attention of a number of honorable members and the keenest interest of various State governments. Although negotiations with the Commonwealth Government have taken place, it appears that no solution has been reached or, if a solution has been reached, it has not been made public. It is certainly no solution to say that as we have only 35, 45 or 60 years’ supply of iron ore we must prohibit its export. What will happen when that period expires? Will we then import iron ore? Mineral deposits are discovered because an incentive exists to go and look for them. No incentive exists in relation to iron ore. One could find the largest iron ore deposit in the world but, if it happened to be in Western Australia, for instance, the finder would not receive one penny reward. The State government has a blanket reserve on all iron ore deposits, as well as deposits of a number of other minerals. The wealth thus tied up in dormant mineral fields is enormous.

The Commonwealth embargo on the export of iron ore will continue to be a thorn in Commonwealth-State relations until the reasons for the embargo have been explained and the whole position is given a thorough airing. There can be little doubt that great quantities of iron ore exist in Australia and that these would be located, evaluated and exploited to the infinite value of the nation if, for instance, permission were given for portion of the output to be exported. Therefore, I urge the Government to appoint a select committee to inquire into the effect on our reserves and on the economy of the Commonwealth in general and of Western Australia in particular, of the export embargo on iron ore.

I wish to direct the attention of the Government to an anomaly which exists in the Income Tax and Social Services Contribution Assessment Act in its application to the municipality of Geraldton, which is in my electorate. Although the area immediately outside the municipal boundary is in the B zone for taxation purposes, the municipality itself is not. Geraldton is recognized as having a cost of living index figure higher than that which applies in most other towns in the State, but the Commissioner of Taxation has ruled that the defini tion of B zone, which is vague and inconclusive, excludes Geraldton. The definition of zone B, in Part II. of the Second Schedule to the Income Tax and Social Services Contribution Assessment Act states, inter alia -

All that portion of the mainland of Australia lying south of the southern boundary of Zone A and north of a line commencing at the northeastern corner of the Shire of Broadsound in the State of Queensland thence … to the No. 2 rabbit proof fence by that fence to the north boundary of the Road District of Perenjori and thence by the boundaries dividing the Road Districts of Perenjori Morawa Mingenew Irwin Greenough and Geraldton from the Road Districts of Yalgoo Mullewa and Upper Chapman to the western coastline.

The line mentioned does not in fact reach the western coastline, but strikes the boundary of the municipality of Geraldton, which itself is on the coastline. I suppose it is quite natural for the Commissioner of Taxation to give in this matter a ruling which is favorable to the Taxation Branch. However, I ask the Government to have the act amended in order to eliminate this ambiguity and remove the anomaly created by including Geraldton in Zone B.

Section 79a of the Income Tax and Social Services Contribution Assessment Act states that the purpose of the zones is to give to residents of the area within the zones - . . recognition of the disadvantages to which they are subject because of the uncongenial climatic conditions, isolation and high cost of living in Zone A and. to a lesser extent in Zone B . . .

In respect of Geraldton, the cost of living disadvantage applies, not to a lesser extent, but to a greater extent than in many centres in Zone A. I suggest, Sir, that this amply illustrates that the position is unjust, and I trust that it will be rectified.

The Opposition, in its frustration, has proposed an amendment to the motion for the adoption of the Address-in-Reply which constitutes a motion of no confidence on the issue of inflation. I suggest that in doing this the Opposition has paid a great tribute to the Government. After more than ten years in opposition, the Australian Labour Party cannot find anything better with which to usher in its new leader in this Parliament than a proposal on a matter about which everybody is well aware and which the Government has announced sound measures to deal with - something for which the Opposition is unable to state a better remedy. The Opposition’s charges on this issue have been adequately answered. Indeed, they have been reduced to nothing. I do not want to elaborate on the excellent answers to this charge which have been given by previous speakers from this side of the House. I just wish to direct attention to the pathetic nature of the Opposition’s approach.

We have been living with a certain amount of inflation for thirteen years now. This inflation has been necessary to enable us to cope with the intense national development which has taken place over this period. In fact, Sir, all but those who are absolutely one-eyed will agree that this Government has achieved the maximum degree of development and the maximum measure of real prosperity with the bare minimum of disruption of the economy. In most countries of the world, currencies have been subjected to varying degrees of inflation and fluctuation of values generally since the war. But this Government’s financial policies have kept the Australian economy at a commendable level of stability. The balance between development, prosperity, employment and stability which has been maintained by this Government has been the envy and admiration of all the world. I have no doubt that the people of Australia will see the Opposition’s pathetic no-confidence motion in its true light and that they will continue to entrust Australia’s economic welfare to the present Government - at least until they are convinced that another can do better.

Debate (on motion by Mr. Crean) adjourned.

page 400


Australian Military Forces

Motion (by Mr. Roberton) proposed -

That the House do now adjourn.


.- I regret that you did not see me, Mr. Deputy Speaker, when I rose the first time after you had formally put the question.


– I was happy to leave it that way.


– I appreciate your very good humour at this late hour, Sir, and I hope that it will always be associated with happy events in your life. I wish to bring to the attention of the House, albeit it is a House which is very ill-attended on the Government side-

Mr Browne:

Mr. Deputy Speaker, will you direct the honorable member’s attention to the fact that only six Opposition, members are present?


– There is no point in that, because it will not be heard in the far corners of the western desert. The honorable member cannot make any progress in that way.

I wish to raise the position that is arising in relation to the administration of the Australian armed forces, and, in particular, the Australian Army. This is an important and serious matter. I should like to mention three things. First, although it is some time since the re-organization of the Army and the other defence forces was begun, no opportunity has been afforded to the Parliament to discuss the matter. We are forced to raise it during the debate on the motion for the adjournment of the House at a late hour of the night simply because the Government proposes to ignore the Parliament’s right to discuss a matter which is vital to the nation’s defence and to the country’s budgetary position, and, of course, of great interest to those who are involved in the defence services. That is the first point: The Parliament is being ignored.

The Parliament is being ignored in two ways, as is particularly evident from the attitude of the Minister for the Army (Mr. Cramer). A few weeks ago, there was an unfortunate occurrence in the Rip, in Port Phillip Bay. The Opposition raised the matter and indicated its opinion about it, pointing out the desirability of a public inquiry, because the occurrence of that event had caused great public uneasiness. The Government, the Minister in particular, and the Army authorities refused to make any public statement or to allow any public inquiry. This is a serious reflection on the whole administration of the armed forces.

The second point that I wish to make is an important one. The Australian Army is not simply a defence organization. It is part of the Australian way of doing things. For the last 50 years or so, the Australian Army, in respect of all its principal units, has been a citizen army. This citizen army has supplied the principal leaders in both world wars and, of course, has been the backbone of our armed forces. Therefore, we must consider carefully public attitudes to the armed forces, because anything that causes dissatisfaction with the Army will prejudice our prospects of raising satisfactory forces. That is the important point about the Port Phillip disaster and about the Government’s attitude on the matter, especially in the light of the Minister’s absolute refusal to make a satisfactory statement or to allow any public inquiry.

The third point that I wish to make relates to the debate in the Government party room earlier this week about certain retrenchments that are taking place in the Army, as reported in the press this morning. This matter, also, is causing great dissatisfaction and uneasiness. What is the position? Men are being retrenched from the Army, not because of the reorganization that is taking place, and not because this Government has accepted the almost universal attitude that disarmament should be the order of the day, but, so the Minister apparently has said, because they are inefficient. This is a serious matter. I find it difficult to believe that, fifteen years after the war, men who have attained high rank in the Australian armed forces are shown to be inefficient. Some of the officers concerned are brigadiers, others are colonels and others are lieutenant-colonels.

What is happening is only symptomatic of the whole of the Government’s approach to defence. The Minister’s statement that these men are inefficient will have a serious effect on the whole status of the Army. It is imperative that this branch of the armed forces stands before the people of Australia as part of their own community way of life and that it enjoys the absolute confidence of the people. There are two important aspects of this matter. We rely on the citizenry for recruits, and therefore we want public support in order to maintain recruiting for the forces. There is no doubt that, in the last seven or eight years, it has been very difficult to maintain the volunteer content of the armed forces.

But there is another aspect. If the Minister is allowing himself to be quoted as having made statements such as those attributed to him, and if the Government is content to allow the Army to be administered in such a way as to promote dissatisfaction, uneasiness and insecurity among the higher officers, what will be the effect on the rest of the troops? The fact is that the Government is seriously damaging the status of the military forces as career services in the eyes of the people, from whom we wish to recruit future Army officers.

Let us consider what has happened. It is obvious - information has come to us not only via the leaks to the press from the Government party room, but also from other sources - that officers have been informed that their services have been dispensed with. There is no other word you can use. They are to be dispensed with. If it is said that they are to be retrenched in the ordinary course of a re-organization of the Army and a reduction of the strength of the armed forces, then I say that Australian servicemen are entitled to treatment similar to that meted out when the Indian army was being retrenched or when the British army was being re-organized a couple of years ago, but we have the unhappy feeling that these men are going to suffer, possibly very severely, because the provisions of the Defence Forces Retirement Benefits Act, as amended just before Christmas, and the general attitude of the Army to this sort of thing will give them less than a fair deal. We on this side of the House believe m full employment and in a fair go for everybody, no matter what his calling may be. It does not matter whether these men are top brass or the last privates of the line. If the Government does this sort of thing to the top brass, what about those further down the line, who will suffer similarly?

Mr Whitlam:

– It will affect warrant officers, too.


– Yes, we know that warrant officers and non-commissioned officers in the Regular Forces will suffer similarly.

Mr Chaney:

– How do you know?


– We do not know for sure. That is why I am standing in my place now. I know that the honorable member for Perth, who has interjected, is the kind of man who would like to see a fair go and justice for all. He would certainly, judging from his background, like to see men secure in the Services. The point that we on this side of the House make is that, apart from criticism based on public reports, we do not know the details. Whatever honorable members on the Government side may say, we of the Opposition are members of this Parliament, and we are entitled to know the facts.

We are concerned because, after the commando exercise at the Rip, and the unfortunate tragedy that resulted, the Minister for the Army refused to have a public inquiry or to do much more than say that Army procedures were satisfactorily carried out. We are concerned also about the situation that has developed because of retrenchments in the Army. We have not been fully informed. We know well enough that this is going on, but we do not know it in such a way that it is public property. Honorable members on the Government side may well shout, but I know that in their hearts they must be sympathetic with my point of view. I have a lot of associations throughout the armed forces, particularly the Army - the Regular Army as well as the Citizen Military Forces. For 25 years, I have been a member of the forces. I have been associated during all my adult life with the Australian Army in one way and another. I feel strongly about the Army and its status in the community. I have endeavoured at times to recruit men for it. I know the general attitude of the public towards the Army. It is unfortunate that the Army’s public relations have not been very good throughout the time I have been associated with it.

Mr Chaney:

– That is not the fault of the Army.


– It is the fault of the administration. I do not want particularly to blame the Army, for, after all, the blame for any public policy lies with this Parliament and with the Ministers who sit opposite. It is fair, proper and just - in fact, it is inevitable - that we should speak on behalf of the people we represent. It is the duty of the Minister to be fair, aboveboard and absolutely without prejudice in his dealings with the Parliament. He must be frank with us all the time. Every honorable member should know what is going on in the defence forces. These are the matters that concern me.

I know that these men will leave the Army feeling that they have been treated very unjustly. I know that, because of the Minister’s gaucherie, the word will go through all the services, and particularly through the Regular Army, that so-and-so got a bowler hat. The Minister has made no effort to make a public statement denying that he said what he is alleged to have said, or that that was his attitude. I find it difficult, to believe that men who have achieved such distinction in the armed forces can be inefficient.

Mr SPEAKER (Hon John McLeay:

Order! The honorable member’s time has expired.

Minister for the Army · Bennelong · LP

– Let me say at once that I do not intend to follow the arguments that have been advanced by the honorable member for Wills (Mr. Bryant). My purpose in rising is to refer to this matter of several officers who have been retired. I want to say that I deplore that this matter, with all its attendant press publicity, should have developed in this way. I regret very much indeed the embarrassment that must be caused to the officers concerned.

At the beginning, I should like to point out that provision has always existed to retire officers prior to their retirement age “ for the needs of the service “. Those are the words used in this connexion. My only consideration in this matter, Mr. Speaker, is - as I hope it always will be while I am Minister for the Army - to ensure the overall good of the Army itself. That is the important thing to me, and it should be the important thing to all honorable members of this House. As all honorable members will know, particularly those who have served in the Services, Army postings are changed regularly, usually every three years, except, of course, in exceptional circumstances. This is very necessary in order to give the widest possible experience to officers, who are required to be capable of carrying out the duties associated with a variety of appointments throughout their careers. It is this basic requirement that has brought about the present position of the eight officers who are concerned in this matter.

Mr. Speaker, in accordance with the policy I have outlined, these officers cannot stay indefinitely in their present postings, and there are no other suitable postings to which they can be appointed. They are, therefore, being retired to meet the needs of the services.

The decision to retire these officers was not lightly taken. After a searching examination by the Promotions and Selections Committee and then by the Military Board itself, the recommendation was made to me. For the information of honorable members, I want to say that these committees include the eight senior officers of the Army, including the Chief of the General Staff. Their recommendation to me on this subject was completely unanimous. In addition, I personally went closely into this matter before I finally agreed to the proposal, and I am quite satisfied that it was the correct course to take. Six months’ notice was given to each of these officers to assist in his transition to civil life.

I should like to make it perfectly clear that while a vast re-organization of the Army will be taking place throughout the whole of this year, this has no connexion whatever with the decision to retire these particular officers. It will be remembered that, in November last, referring to the Army re-organization and the cessation of national service training, the Minister for Defence (Mr. Townley) made a statement in this House in which he said -

There will be a proportion of personnel who, because of age and qualifications, cannot be suitably placed, and their accelerated movement out of the Army will be necessary.

This is a quite separate matter. The detailed investigation in the various commands throughout Australia is still going on. A final decision in those matters has not yet been taken. All of these eight officers to be retired will receive quite substantial pensions in accordance with the provisions of the new Defence Forces Retirement Benefits Act which was passed by this House during the last session. In addition, they will receive pay in lieu of furlough - they are fully entitled to that, of course - and this again is a substantial amount.

Mr Whitlam:

– They will not receive the full amount that they would have received if they had gone to their respective retiring ages.


– They will receive pensions under the act which was passed last year. They are very substantial pensions and, of course, they are now paying the contributions which are required by that act. In addition, they will receive their full furlough pay which is a very substantial sum, totalling almost the amount of their annual salary.

I do not want to continue in this debate any further; I merely wanted to give those simple facts. However, let me say finally - I think it is necessary for me to say this - that these officers have rendered long, honorable and valued service, and I sincerely regret that anything I said personally yesterday at a private meeting as to their efficiency should have caused them unnecessary hurt or embarrassment.


.- The Minister for the Army (Mr. Cramer), as usual, has told us half a story. The Opposition is pressing for the real story behind the sacking or the purging of eight high-ranking officers and three others, as reported in the afternoon press. Behind the sacking is a story of vast reorganization in the Army. The Minister has belittled the incident by saying that only eight officers are involved. They are men of long service and great valour, and he farewells them with a sort of left-handed compliment by saying that they are gone now and nothing more can be done. He then makes an apology for an unguarded statement in which he said they were inefficient. If they were inefficient yesterday, they are inefficient to-day. But that is not the issue. They are redundant to-day as they were redundant yesterday.

The Minister is evading the issue. Quite frankly, he is not bothering to give the House his confidence when he talks about these people only, because the information we have is that 500 officers and noncommissioned officers are to be fired from the Army and that 100 civilian personnel, of whom twenty are permanent public servants, will be transferred to other departments. We want the Minister to answer this assertion either himself or through one of the other Ministers here. What the Opposition objects to is the hole in corner way in which the regearing of the Army is being effected. Some sort of a desultory decision was given by the Minister for Defence (Mr. Townley), who spoke in the vaguest terms of what would happen. Although we have not been told, we now know what is happening. This re-organization means the disappearance of the Citizen Military Forces as a competent fighting force in the community. The Minister has not told us anything about that, and does not intend to tell us. He intends to bluff it through.

We have now a small thrust force. We do not oppose the formation of this force. In fact, some years ago, Dr. Evatt, who was then Leader of the Opposition, suggested that there ought to be a police force ready for international action, and I take it that that is what the new force is. Unfortunately, we can only guess at these things, because the last real military operation we heard of was when the honorable member for Mackellar (Mr. Wentworth) mined Wanda Beach at Cronulla or the “ wavynavy “ Minister, Mr. Beale, ran the “ Yacka.hickydoo “ on to the Hawkesbury oyster leases. Whether we have only a small Army or not, it is time that we were told what is going on. The Minister for the Army, all shaky and nervous about the matter, has not taken us into his confidence at all. Is it not a fact that the sacking of these officers is a victory for the “ brass “? The civilian soldiers will be gone forever and the Duntroon men will remain. The Duntroon man is a good man and a trained man. Many workers’ sons have graduated from Duntroon with distinction.

We are not being hypercritical or hypocritical about this matter, but we want some information about the ultimate fate of the C.M.F. If, as the Minister admits, eleven battalions in New South Wales will become two battalions, what happens to the traditional, highly regarded C.M.F.? These men have been the nuclei of our forces in both World War I. and World War II. A vast army has mushroomed around them, and they still have their traditional units in the back streets of the suburbs. Some of these C.M.F. battalions are 100 years old. The commander of one of them, a man with the good solid name of MacNab, has written to me concerning the disappearance of the whole of the unit to which he was attached, except that some of it will be absorbed by other units.

The Minister merely says here that all the talk this morning about sackings can be fruitfully explained. He says that these officers are being allowed to go because they are redundant. Then he pours a sort of soothing syrup on the situation. But he does not reveal that there has been a shake up in the Army from top to bottom, and he does not give us the relevant information that we want. If he wants to do so, he can tell us through the next honorable member to speak how this citizen force will be disposed of eventually. Is it true, as we allege and believe to be so, that 500 officers and non-commissioned officers will be dismissed and that 100 civilian personnel, of whom twenty are permanent public servants, are to be transferred to other departments? There are gentle remarks about bowler hats, but this is a wholesale sacking; it is a holocaust of the men in the service.

The Minister has been led up the lane about the usefulness of the C.M.F. when compared with the regular Army. As every soldier and every interested Australian knows, these units are inter-dependent, one with the other. The Minister is getting rid of one section altogether. I ask him to say whether it is a fact that many C.M.F. officers will be dismissed or will have no further work to do. If eleven battalions are to become two battalions in New South Wales, it is certain that the C.M.F. personnel will have nothing to do. We charge the Minister, first, with being reluctant to give us information and, secondly, with being evasive to the point of untruthfulness when he does eventually give information. We also level a charge at the Prime Minister (Mr. Menzies) in relation to the integration of the military forces into a thrusting force for overseas. In 1951, he said that any person signing up with the C.M.F. had to sign up for overseas service, but the important proviso was that C.M.F. personnel would not be called upon for overseas service unless there was a major war. The position is now this - and I want the Minister to listen carefully: If the thrusting force, in discharge of a Seato bargain or some other circumstance, is called overseas, where will the Minister get reinforcements for it? It would swallow up the C.M.F. in the first replacements and the C.M.F. would no longer be available for home defence. We do not think that that is a very good idea. In the first place, the force is too small and then the C.M.F. is not being absorbed, it is being abolished entirely.

The Minister has failed to realize that jealousy exists within the Army and he has allowed the “ brass “ in effect to do away with the civilian soldier. The civilian forces produced Blarney and Monash. They were the breeding ground for active officers in World War I. and World War II. We want the Minister to consider these things seriously. We are not putting up arguments merely to irritate him. The Minister, of course, knows more about subdivisions than divisions, but we do not take advantage of that. We ask him to give us a fair statement of the situation. No statement has been made in the House. We have never obtained a proper statement from the Minister for the Army about what is happening. We do not disagree with the formation of a small compact thrust force. But the fact is that we have been inundated - and I am sure that Government supporters have been inundated - with letters from members of our historic citizen battalions asking that something be done to preserve the tradition of the old Saturday soldier. These soldiers have been the basis of huge armies. From Saturday afternoon soldiering came the forces that were created in World War I. and World War II. And they are to be demeaned and obliterated. They are not merely to be given bowler hats; they are to be bowled out neck and crop to make room for a small professional group which will need them day after day in the development of the Australian Army. If the Army is called overseas as a force to sustain a pact, or a decision of this country, it must have reinforcements, but the paltry remnants of the Citizen Military Forces will be absorbed in the first major engagement.

We get back to where we started. The fact of the Stalin-like purge of eleven officers is serious enough; and the fact that the Minister has not been reasonable enough to let this Parliament know about the incident at the Rip, which was touched on by the member for Wills (Mr. Bryant), highlights the fact that his department is slipping badly and that he is in the hands of the top brass - in the merciless grip of the Colonel Blimps. We would like, as an Opposition, to release him from his troubles. I know that the Minister is humorously called “ Jungle Jack “. We want him to come out of the jungle of his own contriving and see that the C.M.F. is restored to its former prestige and glory. The Minister should see that the top brass do not get him down, because if they do they will crook his leg.


.- Mr.


Motion (by Mr. Hasluck) put -

That the question be now put. (Mr. Speaker - Hon. John McLeay.)

The House divided.

AYES: 60

NOES: 30

Majority . . . . 30



Question so resolved in the affirmative.

Original question resolved in the affirmative.

page 406


The following answer to a question was circulated: -


  1. Are proposals made by the Australian Wool Bureau for an increase in the wool levy at present being considered by the industry?
  2. What has been the approximate total expenditure in Australia by the industry and governments on wool research and wool promotion?
  1. The Australian Wool Bureau has suggested, for the consideration of the wool industry, a substantial increase in the levy for wool promotion. The bureau has also suggested the establishment of a joint levy for wool promotion and research in order to simplify collection. Woolgrowers have been asked to consider two alternative schemes of making the joint collection: (a) a rate per bale; (b) a percentage basis. On the baleage basis, the suggestion provides for a maximum rate of £1 per bale (18s. for wool promotion and 2s. for wool research) and a minimum rate of 12s. per bale (10s. for promotion and 2s. for research). The joint levy for 1960-61 and 1961-62 to be paid at the rate of 12s. per bale. The percentage basis provides for a maximum levy of1½ per cent. of the gross proceeds of wool sold and a minimum of 1 per cent. The rate for 1960-61 and 1961-62 to be 1 per cent. of the gross proceeds. The levies which can at present be imposed on woolgrowers under the Wool Tax Acts (Nos. 1 and 2) of 1957 are a maximum of5s. per bale and a minimum of 2s. per bale for wool promotion and a maximum of 2s. per bale for wool research.

The rates at present applying are 4s. per bale for wool promotion and 2s. per bale for wool research. Both of these levies are collected separately. The Commonwealth Government contributes 4s. per bale for wool research, but does not contribute directly to the financing of wool promotion. I understand that the proposals of the wool bureau are at present being considered by the woolgrower organizations.

  1. The total expenditure by the Australian Wool Bureau on wool promotion in Australia from 1954-55 to 1958-59 was as follows:-

In addition, the Wool Bureau contributed the following amounts during those years to the International Wool Secretariat for the promotion of wool in overseas countries: -

Provision has been made for a significant increase in the expenditure on wool promotion both in Australia and overseas during 1959-60. Total expenditure on wool research in Australia from 1954-55 to 1958-59 was-

Up to and including 1956-57 wool research was financed from contributions by the Commonwealth Government at the rate of 2s. per bale of shorn wool produced and from investment revenues from the Wool Industry Fund. From 1957-58 onwards increased funds became available for wool research through an increase of the Government’s contribution to 4s. per bale, a contribution by woolgrowers of 2s. per bale and investment revenues from the Wool Research Trust Fund. The wool research budget for 1959-60 provides for a substantial increase in expenditure over that of 1958-59.

House adjourned at 10.38 p.m.

Cite as: Australia, House of Representatives, Debates, 17 March 1960, viewed 22 October 2017, <>.