House of Representatives
31 August 1960

23rd Parliament · 2nd Session

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

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– I desire to ask the Prime Minister a question. Is it a fact that Senator Spooner, the Minister for National Development, has announced the sale of the Bell Bay aluminium works? If so, who are the lucky people to whom this gold mine has been given, and at what bargain price was this further section of the people’s property handed over? Also, what easy terms of payment were decided upon by the Government before acceptance of the offer of the particular cartel that benefits?

Prime Minister · KOOYONG, VICTORIA · LP

– I am sorry, Mr. Speaker, I did not realize this was a question. I thought it was just a bit of fluff. However, leaving on one side these fanciful references to gold mines, the honorable gentleman will be delighted to know that my colleague will, later to-day, be making a statement of considerable precision on this matter.


– I desire to ask a supplementary question, Mr. Speaker. Will the Prime Minister arrange that a statement similar to that which Senator Spooner is to make in the Senate will be made in the House of Representatives at about the same time?


– I do not know that, when a Minister in the Government makes a statement in the House to which he belongs, it is the common practice to have a corresponding statement made in. the other House; but I will certainly see to it that a copy of the statement to be made by Senator Spooner is available to the honorable member and to all other members of this House at the earliest moment.

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– I direct my question to the Prime Minister. Has the right honorable gentleman’s attention been drawn to a statement made yesterday by the president of the Australian Council of Trade Unions, that he had asked the All-China Federation of Trade Unions of Communist China to send two delegates and! an interpreter for a three weeks’ visit at the end of September, and that they would visit industrial plants and major industrial undertakings throughout Australia? Will he take action to ensure that these Communists, whose visit is supported by only a section of the Australian trade union movement, are not allowed to inspect defence and other industries important to the protection and defence of this country, and so prevent information being obtained which could, under certain circumstances, cost Australia lives?


– The honorable member may rest assured that those gentlemen will not have access to any matters of the kind that he described.

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– I wish to ask a question of the Minister for Primary Industry. I refer to the display of Australian cheese within Parliament House and ask whether cheese-making is an ancient art and whether cheese has featured in the diet of most of the earth’s peoples almost since man began to tend his flocks.


-Order! There is too much noise in the chamber.


– I shall ask the question again. I ask whether cheese-


– Order! I ask honorable members to co-operate with the Chair and to obey the Standing Orders. Honorable members should realize that question time could ultimately be destroyed by their own behaviour. It is only fair that honorable members, and one honorable member in particular, should remain silent so that members who occupy back benches may enjoy the same right to be heard as those who sit on the front benches. I ask that the honorable member for Macarthur be heard in silence.


– I am delighted about the excitement caused by my question.


– The honorable member will direct his question.


– I ask whether cheesemaking is an ancient art and whether cheese has featured in the diet of most of the earth’s peoples almost since man began to tend his flocks. Has cheese been made in Australia almost since the early days of this nation? Does the display mark the stage at which Australian cheese-makers can now present an article equal or superior to anything in the world?

Minister for Primary Industry · FISHER, QUEENSLAND · CP

– I am not ancient enough to know what happened before the twentieth century, but I do know from records some of the history of cheese-making in Australia. I am very pleased with the exhibition in Parliament House. Most honorable members have seen it. It is associated with the National Festival of Dairy Foods, which commences to-morrow. I am sure that, just as honorable members have given the exhibition a good reception, so will members of the public, who will recognize the value of these very good products that are now being made in Australia.

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– I desire to ask the Prime Minister a question. Is it proposed to call the basic unit in the new decimal currency a “ Ming “, as being something of very little value and as a means of commemorating the eleven-years-old unfulfilled promise of the Prime Minister to put value into the Australian £1?


– I cannot positively answer the question put by the honorable member, but I would like him to know that I have been giving a good deal of serious thought to discovering, first, what is the most worthless coin in the currency and, secondly, what it ought to be called. I am entirely in favour of calling it a “ Ward “.

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– My question is directed to the Minister for Primary Industry. In view of the increasing interest by primary producers in an Australia-wide poll on an alteration of the system of wool marketing, will the Minister ask his department to prepare a statement setting out the main points involved in a floor-price marketing plan? Will his department also set out the experience of nations which use a floorprice plan? Could this statement contain a brief history of the fluctuations of the price of wool in Australia over the past 30 years and be made available to all woolgrowers throughout Australia and to members of this House?


– I am not aware of any determined floor-price plan. If the honorable member so desires, I can give him particulars of a floor-price plan that was submitted to growers some years ago. but no doubt he is acquainted with it. No new floor-price plan has been determined. I will ascertain what information my department can obtain on the experience of other countries and on the fluctuations of wool prices in Australia, and supply it to the honorable member.

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– I direct a question to the Treasurer. Did the right honorable gentleman state, in a television interview last Sunday evening, that the age pension has never been regarded as other than’ a supplement in meeting the needs of the pensioner and that the community has a right to expect the family to accept responsibilities in this connexion? If this is an admission’ that the pension is not expected to maintain a person who receives it, what is a pensioner who has no family or whose family is in impecunious circumstances expected to do to keep body and soul together?


– It is a fact that in the course of the interview which the honorable member has mentioned, I said that the pension had been regarded by both sides of this Parliament as a supplement. I believe that to have been true ever since federation. I went on to say that at the time when this Government took office the basic rate of pension was £2 2s. 6d. a week and that it is now £5 a week, plus free medical benefits and treatment, free pharmaceutical benefits, a scheme to provide homes for the aged, and other liberalizations through the means test and in other ways, all of which has made our pensions scheme comparable with the best schemes in any part of the world. I am quite certain that honorable gentlemen opposite could not have regarded the pension as other than a supplement, because they can hardly argue that in 1949 £2 2s. 6d. a week represented a pension determined on a needs basis. Nor could the pension have been regarded as other than a supplement by those who composed the Labour Government which reduced pensions - the only government in the history of this federation to do so.

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– My question is addressed to the Minister for Trade. Has the Minister’s attention been directed to a report that when certain tenders were recently submitted to the Sydney County Council, it was found that porcelain insulators imported from Japan, France, England and New Zealand were cheaper than the Australian-made product, even after the prices of the imported articles had been adjusted under the provisions of the New South Wales Local Government Act, which provides for preference to local industry and which requires local government bodies in that State to add up to 30 per cent, to the tender prices of imported foreign goods and 10 per cent, to the tender prices of British goods in order to make a comparison with the prices of Australian products before the acceptance of tenders? I ask the Minister whether he considers that the Australian tariff and tariff procedures are adequate, or whether he considers that they are not adequate, to afford due protection to Australian industry against foreign goods and against any British goods receiving such preferences as are considered desirable as a result of trade negotiations between the Australian and United Kingdom governments? If such tariff arrangements are considered adequate, does it not seem that in New South Wales inflated prices are being paid for doubly protected goods by local authorities, which use money that belongs to the ratepayers, and by public authorities, which use money that belongs to their consumers? Does the Minister know whether similar-


– Order! I suggest that the honorable member ask his question.


– I am coming to the end of it. Does the Minister know whether similar legislative requirements exist in other States, and would he care to make any other comments relevant to this matter?

Minister for Trade · MURRAY, VICTORIA · CP

– The only knowledge of the incident that I have is what I have read in the newspapers and the information which the honorable member has now conveyed to me. I can say in reply to part of his question: I believe that the instrumentality for advising the Government on tariff-making in Australia, for the purpose of giving both adequate protection to Australian industry and adequate preferential treatment to British goods in terms of our trade treaty with the United Kingdom, is adequate. I know that the Local Government Act of New South Wales contains a provision which requires local government authorities to give to goods produced in Australia a measure of preference over and above the preferences provided for in the tariff, and that is done. I do not know exactly what the position is in other States. I can say, however, that it is not uncommon, in the case of government instrumentalities and local government authorities, and also in private circles, for a tender to be accepted, for a variety of reasons, at a figure higher than that for which similar goods could be procured from overseas. Sometimes there are quite good reasons for this. One arguable reason may be that the instrumentality concerned, or the private company, merely wants to make the gesture of supporting Australian industry. That opens the way to the kind of argument that was inherent in the honorable member’s question.

In certain commercial circumstances a valid judgment may be made that it is in the interests of a consumer to rely upon a local source of supply, from which service is readily available, from which replacements may be obtained and where there is no doubt of continuity of supply, even though a higher price is paid for these assessed commercial advantages. On the other hand, it is not unknown for orders to be placed overseas as a gesture of disapproval of some combination of producers within Australia. Orders may also be placed locally as a gesture against a similar combination of overseas suppliers. Of course, if preference of this kind is carried too far, it must obviously react to the detriment either of ratepayers, as in the case covered by the honorable member’s question, or the profit-making capacity of a private concern.

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– I address a question to the Minister for Trade. By way of explanation, I may say that plywood manufacturing interests are very concerned at the results of the lifting of import restrictions on plywood. That this concern is not without foundation is shown by the fact that in the twelve months immediately prior to the relaxation of the import licensing provisions, the total value of licences issued for the importation of plywood from one country alone was £59,357, while in the three months since that time-


– Order! The honorable member is giving information. This may be within reason, but I think he is unnecessarily prolonging it. If he is seeking information from the Minister, I suggest he should now ask his question, based on the information he has already given.


– I ask the Minister whether it is true to say that in the twelve months before the relaxation of the restrictions the value of licences issued for the importation of plywood from one country alone was £59,357, while in the three months since that time licences have been issued to the value of £53,068 for the importation of plywood from that country-


– Order ! I think the honorable member should ask his question and allow the Minister to give the information.


– I ask the Minister: What action has the Tariff Board or the Department of Trade taken to protect this industry, having in mind the greatly increased volume of import licences and the increased amount of plywood being imported from the country concerned?


– Order! Before I call the Minister I want to say, for the benefit of new members and others, that all members are entitled to seek advice from the Clerk of the House and his staff, who will assist them in preparing questions that they wish to submit. I should think that it would be prudent for honorable members to avail themselves more often of the services of these officers. I call the Minister for Trade.


– I cannot confirm the statistics which the honorable member has cited, but surely the critical point is whether the Australian industry is thriving with the existing degree of protection. The Australian timber industry unquestionably is in a prosperous condition. This is due. no doubt, to both the protection that is accorded the industry and the very healthy state of the Australian economy under this Government.

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– I address my question to the Attorney-General. I refer to the Speech made by the Governor-General in another place, in which His Excellency announced that the Government intended to review and amend the Bankruptcy Act. I refer particularly to that part of the act which authorizes the issue of a bankruptcy notice for a proved debt of £50. This procedure has been widely used in recent years as a debt-collecting instrument, instead of as the initial step in a drastic legal process designed to deprive the bankrupt of a great many of his civil rights. What action has been taken to amend this provision and other provisions of the bankruptcy legislation?


– A highly qualified technical committee has been working on a review of the Bankruptcy Act for some time and I have asked the committee on several occasions to do what it can to expedite completion of its investigations. The particular matter to which the honorable member has referred - the minimum sum which will support a bankruptcy notice and, therefore, a bankruptcy petition - has engaged my attention ,and, at my request, the attention of the committee. I agree with the honorable member that the bankruptcy process should not be used merely as a debt-collecting mechanism, and that the minimum of £50 is probably far too low. I understand that the committee will be making some recommendations on this point, but I am bound to tell the House that I do not expect its report this year.

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– I address my question to the Minister for External Affairs. What steps, if any, has the Government taken to support the frequent protests - the most recent was made at last month’s congress of the International Transport Workers Federation - concerning the continued interference by the United Arab Republic with ships sailing to Israel from other countries through the Suez Canal?


– As the honorable member probably will recall, this matter has engaged my attention more than once. My views on it have been expressed with, I hope, great vigour if not with effect. The Australian Government constantly supports freedom of transit through the Suez Canal. The practical problem nowadays is whether a result can be achieved better by individual action by individual countries or by maintaining pressure on the Secretariat-General of the United Nations to emphasize the attitude which the United Nations itself has taken in the past. We think, on balance, that the most effective action may take place through the Secretary-General. But if there is any ambiguity or any question about where we stand in this matter, I say that we stand in unhesitating opposition to this interference with free transit through the Suez Canal.

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– Can the Minister representing the Minister for Civil Aviation say whether any negotiations have taken place between the Commonwealth and Victoria with a view to giving a charter to TransAustralia Airlines to operate on an intrastate basis in that State? If so, what was the outcome of the negotiations?

Minister for Defence · DENISON, TASMANIA · LP

– No, 1 have not any information about the negotiations to which the honorable member has referred. I shall ask the Minister for Civil Aviation in another place to provide me with a reply to the question and I shall let the honorable member have it. However, I remind the honorable member that provision for intrastate activity was specifically written into the amending legislation which was passed during the last sessional period.

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– Has the Prime Minister’s attention been directed to a statement by the Premier of South Australia to the effect that it is about time that the Commonwealth honoured its undertaking under the terms of the Northern Territory Acceptance Act and completed the construction of the northsouth railway? In view of the Territory’s lack of rail transport links with the rest of Australia, and the serious effect on development that such a position presents, will the

Prime Minister state the Commonwealth’s legal obligations under the agreement with South Australia in this respect, and whether any move towards fulfilling its obligations under the act is contemplated?


– The honorable member has asked me whether 1 am aware of some statement which was made by the Premier of South Australia. I can very well remember the Premier addressing some vigorous remarks to me on this problem nine years ago. I am not aware of any recent repetition of them, nor is it part of my function to offer legal advice on these matters, least of all to the Premier of South Australia.

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– I preface my question to the Treasurer by directing his attention to the fact that the use of seat belts in motor cars as a means of saving life has been recommended by numerous authorities. In order to encourage the maximum use of seat belts will the Treasurer consider removing the sales tax on this item?


– When the use of seat belts was first recommended and became fashionable, I did see that there might be some anomaly in the fact that sales tax was retained on that item, and1 I did take the matter up with the Commissioner of Taxation to see whether it would be consistent with the principles applied in other cases to remove sales tax from it. But once you get to the point where you say sales tax should not be payable on any item, whether used inside a motor car or out of it, which is conducive to the safety of the occupant, you begin to encounter problems that arise from that decision. . For example, a bumper bar is an adjunct for safety, and various other items inside a motor car are also designed to protect the passenger.

After a close examination of these matters, it was felt that we could not remove sales tax from this item without also removing the tax from a number of other items in respect of which a very substantial amount of revenue is involved. However, the matter is one of those which come ‘ up periodically for examination in connexion with the Budget preparation, and I shall continue to place it in that category

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Mr Clyde Cameron:

– I ask the

Minister for Territories whether he knows that the majority of the 370 native labourers employed by the Bulolo timber company in New Guinea are being paid at the minimum native labour ordinance rate of 6s. 3d. a week, plus keep. Does he know that plywood produced by this company is being sold in Australia in competition with Australian plywood manufacturers who observe wage rates and workers’ conditions fixed by Australian industrial tribunals? Having regard to the unfair advantage which this cheap labour gives to the New Guinea company, will the Minister take steps to compel the Bulolo timber company to pay at least the new rates recommended for Port Moresby, Lae and Rabaul?

Minister for Territories · CURTIN, WESTERN AUSTRALIA · LP

– I cannot say with certainty that the figures quoted by the honorable member are exact, but I shall check them and let him know in due course. As the honorable member has raised this point, I think I should make two comments. The first is that plywood produced by Commonwealth New Guinea Timbers at Bulolo is not produced solely by the labour of the indigenous workers. There is also a very considerable component of European labour involved for which the normal European wage rates are paid.

The second comment I would make is that in calculating the labour costs in a New Guinea factory one has to be aware of the responsibility of the employer to provide a great number of services such as accommodation, health, clothing, food, rations, and family support, in addition to the cash wage; so that the total remuneration paid to indigenous labour is much higher than the honorable member’s question would suggest.

The third point which I think must be taken into consideration by the House is one which is very important to some of the consideration we have been giving recently to the future of Papua and New Guinea. It is that, unless we provide a broad and olid economic foundation of industry for the Territory of Papua and New Guinea, the economic welfare of the indigenous people, the capacity of the Territory to achieve economic independence, to contribute to its own services and to provide occupations for the indigenous people, will be lessened. One of the points Australia must bear in mind is that we have to provide economic opportunity for the Territory and not think simply of competition with our own goods.

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– By way of preface to a question directed to the PostmasterGeneral, I point out that the introduction of the extended local service area system carried with it increased telephone rentals which are not acceptable to many subscribers in my electorate, particularly in the area known as the Hills district where many subscribers do not enjoy a continuous telephone service while being required to pay the same rentals as those who are provided with a continuous service. Will the Minister consider whether it is not reasonable that a variation of rental should be made for subscribers where a continuous service does not operate under the Elsa system? Will he also consider the possibility of granting concession telephone charges to age pensioners?

Postmaster-General · DAWSON, QUEENSLAND · CP

– 1 have quite recently received from the honorable member for Mitchell a number of cases which he has submitted to me for consideration under the recently developed Elsa scheme. He has made requests in respect of areas which I think include the Hills area. These cases are being referred for consideration to the central office of my department and I hope that I shall be in a position shortly to advise the honorable member of the result of their consideration. He mentioned that some of the exchanges in his area do not give a continuous service and asked whether it would be possible to allow reduced rentals in such cases. I think that honorable members generally know that part of the Elsa plan is to convert, over a period, all services to automatic working which will give continuous service. I do not think it would be practicable to vary rentals in areas in which the change may take some little time. The principle would have to be applied to the whole of Australia because there are many such areas.

The matter of concession telephone charges for age pensioners has been referred to me previously by the honorable member. It has also been the subject of representations from many other members of this chamber and of another place. The proposal has been examined very carefully and sympathetically from time to time. At each investigation it has become apparent that such a concession could not be confined to the one type of pensioner. It would have to be extended to all types of pensioners including widow, invalid and war pensioners, and to a number of organizations. It has become apparent, at each investigation, that it would be difficult to determine where the concession should end. Consequently, it has been decided, on each occasion, that no relief of this kind should be given.

We do provide half rates for local calls for those charitable institutions which are supported mainly by voluntary donations and which have the task of looking after the indigent people in the community . However, they are not given any concessions in respect of rentals or trunk charges. It has not been possible to go any further than that in granting concessions of this kind. Some little time ago, I discussed the extension of concession rates for telephone services with the Minister for Social Services because I think that any such proposal has a certain element of social service in it. As a result of those discussions we found that previous decisions on the subject could not be altered.

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– I ask the Treasurer whether it is a fact that during the past twenty years in which prices and costs have risen astronomically and, in most cases, have been passed on to the consumer, the retail price of Bex headache powders has remained at Id. each. If this is a fact, will the Treasurer ascertain why and how costs, prices, and profits of this company have been satisfactorily maintained, as this would appear completely to destroy the Government’s contention that increased wages are responsible for increased costs? Will the Treasurer ascertain whether this is the result of expert management or of greatly increased demand due to the extraordinary number of headaches brought about by the policy of the Menzies Government?


- Mr. Speaker. I would think that the period in which a rapid turnover in the products of this company had occurred would probably run from about the time when the Labour Party adopted its socialization objective; and until that objective is altered perhaps the turnover of this company will increase.

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– My question is directed to the Minister for the Army. Will he tell the House what claims are being made by municipalities and other bodies for the surrender of land now being used by the Department of the Army and other departments? What precautions have been taken by the Department of the Army to ensure that the needs of departments are protected in any surrender? Would the Minister regard the demands as of such importance as to justify the appointment of a royal commission to investigate them, or could these demands be dealt with adequately departmentally?

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

– I think I have announced in this House previously that I have set up in the Department of the Army a works development committee. The continuous function of that committee is to see to it that we do not hold land that is not essential to the purposes of the Army. The area in which the honorable member for Warringah is interested is a very important one. It is some time since that area was thoroughly examined by this committee and I think the honorable member was advised then that it was needed for the purposes of the Army. In addition, an inter-departmental committee has since been set up which is investigating land held by the services, but the results of that investigation are not yet available. That committee will be looking at the area in which the honorable member is particularly interested.

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– My question, which is supplementary to that asked by the honorable member for Hindmarsh, is directed to the Minister for Territories. By way of explanation, I inform him that I am not basing this question on the pre-supposition that natives in New Guinea have to finance brick homes or buy European clothing. There would be a difference between the wage structure in the Territory and our own which would not be related to any meaningful standard of living. I ask the Minister: What steps are taken to ensure that the wages paid in Papua and New Guinea to natives do maintain the native’s family in health? The provision of services in heu of wages was known in English industrial history as the trucking system and it was open to abuses. Has consideration been given to the establishment of industrial tribunals in the Territory to protect the interests of the natives?


– Some time ago we established within the Territory Administration a native employment advisory board with a full-time salaried officer with considerable experience of industrial matters in Australia at the head. The board held an’ inquiry and will be submitting a report to the Administrator on some of the initial problems in this field. It is our intention - a direction has already been given - to establish within the Territory a department of trade and industry which will have in it a labour division to devote itself wholly and solely to exactly the sort of problem as that to which the honorable member referred. Hitherto labour conditions and rates of pay for the native worker have been governed by legislation - ordinances of the Territory passed by the Legislative Council.

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Mr Malcolm Fraser:

– My question is directed to the Treasurer. Will he tell the House whether the Treasury has been making a study of rising costs as they affect Australian industry and, in particular, rural industry? How have the terms of trade moved in relation to export industries in recent years?


– Naturally the Treasury, the Department of Trade and other relevant government departments, including of course the Department of Primary Industry, have kept a very close watch on movements in Australian commodity prices and the prices obtaining in other countries from which our imports are largely obtained. A recent study which was made of this matter with the latest material, and which has come to me, has revealed a quite extraordinary state of affairs in respect of

Australia. Let us take the base year, 1953, which is taken as the base year by the publications of the International Monetary Fund. That is a year, I might add, which was not an abnormal year in Australia. It was not the boom year of 1951, nor the recession year of 1952. If that year is taken, with a base figure of 100, the terms of trade have moved to a point where, for Australia’s exports, the figure has fallen to 70, whereas our imports from most of the industrialized countries of Europe, and from the United Kingdom and the United States of America, are round about the 109, 110, 111 mark or upwards of that.

Now, Sir, the remarkable thing to me is that Australia has been able to weather so successfully this movement which, by the standards of earlier years, can only be described as a violent movement. I believe that that emphasizes the underlying strength of the Australian economy at present. It also gives point to the argument so cogently produced from time to time by my colleague, the Minister for Trade, that in the world to-day the primary producing countries have suffered in respect of their terms of trade compared with the industrialized countries. Indeed, a survey made a few years ago by the organization of the General Agreement on Tariffs and Trade indicated that, with all the aid these days going to underdeveloped countries from the United States, and being provided under such schemes as the Colombo Plan, a 5 per cent, drop in the average prices of the primary commodities sold by those countries would more than offset all the aid given to them from the sources I have mentioned. So, first, there has been this extraordinary movement, and we have done well to sustain the economy as we have in the face of it. Secondly, I believe that the terms of trade do tend over the years to even out, and in that process Australia should be a beneficiary. Thirdly, there is a very real problem, I believe, ahead of the financial authorities of the world to ensure that, in the process of industrial development, the primary producing countries do not suffer in comparison. I can assure the honorable gentleman that we shall continue to watch this position very closely and do what we can to see that Australia’s interests are safeguarded.

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– I address my question to the Minister for Territories. Yesterday, referring to the exclusion from the Territory of Papua and New Guinea of Professor G luckman, it was pointed out that the information upon which this action was based came from the usual sources. Would the Minister advise us whether those sources were the same as those which gave the advice which reacted so unfavorably and inaccurately on Madame Oilier, the advice which led the former Minister for External Affairs to say there was a nest of traitors in the Public Service, and also the advice which led the Attorney-General to commit the great gaffe he committed last year in relation to the Melbourne peace congress?


– The further matters to which the honorable member refers are not under my administration. I can only say that his judgment on them is entirely different from my own judgment.

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– My question is directed to the Minister for Primary Industry. Will the Minister comment on the statement made by the Minister for Lands in New South Wales-

Mr Calwell:

– I rise to order, Mr. Speaker. An invitation to a Minister to comment is surely out of order.


– Order! The Leader of the Opposition is quite correct. A question asking for comment is entirely out of order.


– Then I shall put the question in another way, Mr. Speaker. Will the Minister say whether the New South Wales Government cannot continue its war service land settlement scheme because it requires more financial aid from the Commonwealth Government? Further, what has been the attitude of the New South Wales Government to this scheme? Has that Labour Government spent or allocated all the available funds for the purpose of further implementing the scheme?


– The decision as to whether or not the war service land settlement scheme in New South Wales will con tinue is entirely one for the New South Wales Government. When the then Premier of New South Wales met with the Commonwealth Government’s representatives to discuss what should be the approach to this very vital matter, the State representatives decided that they would not enter into any war service land settlement scheme except on the basis they would operate as a principal State and that the Commonwealth would provide only the funds for repatriation purposes. In other words, the Commonwealth would provide the money for training and living allowances, and for sharing with the States any losses that were incurred. Because the Commonwealth found in 1952-53 that the State governments had so decreased the allocation of funds towards this purpose, the Commonwealth called New South Wales and Victoria into conference with it with a view to accelerating the progress of the scheme, and at that conference it offered further benefits. The Commonwealth offered to pay special advances of £1 for £1, up to £2,000,000 a year, in grants; but in no case did the States ever use or spend sufficient money to use to the full the Commonwealth’s £1 for £1 offer. So the Commonwealth was more generous still, and offered to grant £2 for every £1 that the States spent, so that the progress of the scheme might be accelerated. However, all that happened was that less money was allocated by the State of New South Wales, which was spending on other purposes the money allocated for war service land settlement. I want to say that responsibility is right back in the lap of the New South Wales State Government. The Commonwealth will continue the original scheme if the State ever wants it, but we did decide on 30th June, 1959, to cease the beneficial allowances that the Commonwealth offered. We did, however, decide to extend the terms regarding the last offer of £2,000,000- that for 1958-59- and allow the States to spend that amount over three years instead of compelling them to spend it within that particular year. So, when the Deputy Premier of New South Wales says that it is a matter for the Commonwealth, I say that it is right back with the State Government. He is only trying to hide the failure of the New South Wales Government to carry out this scheme.

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Prime Minister and Minister for External Affairs · Kooyong · LP

– I desire to inform the House that the Treasurer will be leaving Australia to-night on an official visit overseas. In London he will attend the meeting of the Commonwealth Economic Council, at which other Commonwealth Finance Ministers will be present. Later, he will preside at the annual meetings of the boards of governors of the International Monetary Fund, the International Bank for Reconstruction and Development, and the International Finance Corporation. He will also open the seminar for prominent European businessmen which the Minister for Trade has arranged in association with the Lausanne Fair, at which Australia is the guest exhibitor this year. He will attend also to various other official matters, and will be away from Australia for about six weeks. During his absence I will act as Treasurer.

Mr Calwell:

– You are worse than Mussolini. He had the lot, too.


– This, Sir, is for reasons. As any honorable member with any experience understands perfectly well, it would be very difficult for anybody else to deal with the Premiers, as Treasurer at the Australian Loan Council meeting. Only somebody like myself, who is completely familiar with them, and has always been present at such meetings, can do it. Naturally, Sir, so that the normal work of the department will not suffer, for the detailed administration I will secure the assistance of another Minister.

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– On 17th August, the honorable member for Melbourne Ports (Mr. Crean) and the honorable member for Canning (Mr. Hamilton) asked me questions without notice relating to the manner in which the overseas debt of the Commonwealth and the States is recorded in the annual Budget Papers. In my answer, I undertook to supply some information on this subject and in relation to movements in Commonwealth and State debts in recent years. I have now prepared a statement and it is available to honorable members from my office or from the Clerk of the Papers.

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Motion (by Mr. Harold Holt) agreed to-

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

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BUDGET 1960-61

In Committee of Supply: Consideration resumed from 30th August (vide page 576), on motion by Mr. Harold Holt -

That the first item in the Estimates under Division No. 101 - The Senate - namely,’ “ Salaries and allowances £33,650”, be agreed to.

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

That the first item be reduced by £1.


.- The rapidly mounting troubles of the world and Australia’s poor strategic position, geographically, lead to the conclusion that the survival of Australia should undoubtedly dominate our Budget thinking at this time. One should1 ask whether the Budget will strengthen our defence, especially through a rapid increase and proper distribution of our population. We cannot ignore the fact that we are a country with empty spaces and that just to the north of us are hundreds of millions of people, who are rapidly increasing in number. This rapid increase is due to a revolution in medical science in the past twenty years which has completely destroyed the effect of many endemic diseases such as malaria, plague and typhus. This has resulted especially in the number of deaths of children being reduced.

In China, India and other countries to our north, the population increase each year is greater than the total population of Australia. Therefore, it is absolutely essential that we should do what we can at every opportunity to ensure that our population is increased and properly distributed throughout the country. Unfortunately, statistics show that although our population is increasing very rapidly - our rate of increase is one of the fastest in the world - the increase is largely restricted to the capital cities and other great cities. Indeed, fertile rural areas are actually losing population. We should consider what can be done by the Government to improve the position. In this regard, we should keep in mind that many of the hundreds of millions of people to the north of us are starving. If we, with our 3,000,000 square miles, are unable substantially to assist the feeding of these people, they will look with very hungry eyes on this empty continent and may say, “If you do not grow the food, we will come down and grow it ourselves “. It is, therefore, imperative that we should pursue policies that induce the settlement of people in areas which can produce food and all those items which go to make up the surplus that we export. We should not lose sight of the fact that our exports provide the basis for the development of our secondary industries.

In the course of my study of the past during the last four or live years, when I have been working on my autobiography, 1 have found that many mistakes have been made by governments and by the people. These mistakes have led to the bad position that we are in vis-a-vis the rural and metropolitan populations. If I have any time after I have dealt with my main theme, 1 shall outline some of these mistakes.

To-day, I want to refer to the policy of television as it concerns the people on the land. I remember quite well the coming of radio broadcasting and the first attempts that were made to handle it. Those attempts were not very successful, and at the end of ten years we found that we had to scrap most of what had been done and start anew. About 1930 or 1932. we developed the present system. One of its cardinal features is that people in the outback pay only half the licence-fee that is charged those in the more densely settled areas. That is not everything; yet it is something.

Radio enables us to speak over enormous distances. We can speak from Australia to England and people in the Northern Territory can hear broadcasts from major southern centres. But the range of television is not thousands of miles; it is only 25 or 30 miles. At most, it would not exceed 40 or 50 miles. Therefore, the area covered by each transmitting station is very limited. Before we go any further with our planning, we should look at what has been done. The first stage of the development of television provided for two commercial stations and a government station to be established in Sydney and Melbourne. Then, the other capital cities were given commercial and government stations, and the Government is now examining the position of other major cities. The total population of the areas that will be provided with television in these plans is only about 6,500,000. This means that 3,500,000 will not have the benefit of television, and these are the people who do all the work of producing our wool, wheat, butter, meat and other primary products which feed our people and maintain our exports.

I say, with all the feeling that I can express, that we should prevent the establishment of two Australias - one, with two* thirds of our population, enjoying television, and the other, with one-third of our population, without this facility. The Government’s plan at present covers only 6,500,000 people, leaving 3,500,000 without television. This plan envisages a combination of commercial and government stations.

It is said that at the present time television can be extended to only about twothirds of the people and no service at all can be given to those in the outback. Therefore, it seems to me that we should look at the whole of this problem, dissect it technically, find out exactly what is the cause of our difficulties, and cure them, if 1 may make an analogy with surgery, which has been my metier all my life as a practising surgeon.

The first consideration is that of the economics of these services and the second is that of the technical limitations. These technical limitations are imposed by the limited number of frequencies that are suitable and available for television. Apparently, only two kinds of frequencies are suitable - the ultra-high frequencies and the very high frequencies. The very high frequencies are evidently the only ones that are really suitable for the outback. This is because they have a much wider range in their lower channels. It seems, also, that these frequencies can be handled better. Therefore, I suggest that the ultra-high frequencies be used to provide services in certain cities where the population is big enough to provide a profitable market for the makers of television sets and for the producers of television programmes. The people are too widely scattered in the country to meet these requirements.

We must consider the position and see what we can do. First, we must look at what money is available for television. From what I can see, it appears that plenty of money will be available during the next ten years for the carrying out of a programme for the provision of 55 national television stations and up to 100 commercial stations. The commercial stations, of course, will be financed by those who operate them. It seems to me that the problem which faces this Parliament, and especially the party to which I belong, is to see - and this is really everybody’s job - that the national television stations are so established as to cover the maximum areas of Australia, especially in the outback. As I have said, it would be outrageous to have people in some parts of Australia enjoying television and people in the outback unable to enjoy it. If such a situation were allowed to develop, the population in the country areas would rapidly decline and there would be a big drift to the cities. I have spoken to many families which have been to Sydney, Melbourne. Hobart and other capital cities for holidays, and I find that very often on the family’s return to the country the wife, and especially the older children, want a television set. They say, “ We shall not stay here unless we can have television like everybody else. We want to sit in our own home and see all these programmes on television.” Considerations like these are making it more and more difficult already to get labour in the country, and the difficulties will become much greater if we in this Parliament do not. as it were, put our foot down, and insist that national television stations are established throughout Australia at the earliest possible time and at the most suitable places.

If a network of national stations is spread throughout the country, the likelihood of commercial television being extended to the outback also will be enhanced, because the availability of programmes from national stations will induce people to buy television sets, and once they have sets they will want more and more programmes. . Furthermore, the Government will gain revenue from viewers’ licence-fees and from the excise of £5 on each television picture tube sold. This additional revenue will help the Government to do the job properly throughout the whole country. The licence-fee is at present £5 and, as I have just said, the excise on television picture tubes is £5, and the greater the number of people who own television sets the greater will be the revenue that the Government will obtain from these sources.

If we judge by what has happened in the development of radio, we can estimate that within the next ten years, if the Government adopts my suggestion that television be made universal in this country, we shall have at least 2,000,000 people with licences for television sets. Since the licence-fee is £5 a year, the revenue from this source will be £10,000,000 a year. The excise of £5 on picture tubes will be paid not only in respect of the set originally purchased but also on replacement tubes, and I estimate that, at the very least, we shall derive a revenue of something like £104,000,000 over the next ten yearsrevenue that could be used to extend television services farther and farther throughout the country.

In my opinion, the first thing to be done, if we are really to get somewhere, is for the Government, through the Australian Broadcasting Control Board, to examine the whole country and see which are the most suitable sites for national television stations. Let us not worry about choosing these sites in conjunction with sites for commercial stations, as apparently is the practice at the present time. Technicians tell us that every additional 500 feet in the elevation of a transmitting station extends its range by about 10 or 15 miles. Throughout Australia, we have many mountain ranges extending up to 3,000 or 4,000 feet - a lot of them almost in the midst of plains. Near Gunnedah, in New South Wales, for instance, there is Mount Kaputar, which has an elevation of about 4,000 feet. Bunya Mountain, near Dalby, in Queensland, could provide a site for a television station that would serve the surrounding area of south-western Queensland and northern and western New South Wales. Along the coast, there are numerous high points. A suitable site for a television station is Ben Lomond, not far inland. Point Lookout, which is just one mile high, is another. In Tasmania, there are many suitable sites for television stations at high points.

There are in every State eminently suitable sites from which television broadcasting stations could provide services of extended range. If the best of these sites were chosen for television stations, we could then go ahead and determine the best frequencies to use for the provision of television services in these widely separated areas. As I have said, the best frequencies are the lower channels in the very high frequency range - the V.H.F. range as it is commonly termed. The choosing of the lower channels for services in the capital cities with a consequent shortage of suitable channels for country areas would be a calamity. The higher channels would serve the city areas as well as or possibly better than would the lower channels.

So honorable members can see how imperative it is that before we begin to build this house of television throughout Australia, if I may so describe it, we look at all the features that we want the house to have when it is finished. If we do not, we shall have to do what we did with radio broadcasting. Tn that field, after ten years we had to pull everything down and start afresh. If we have to do this with television, God knows how much loss there will be overall, due solely to a mess at the very beginning.

It is said that a commercial television station needs at least 75,000 listeners in order to assure it of sufficient revenue from advertising. But a listening public of 75,000 can be found only in conjunction with the big cities or metropolitan areas, where stations are able to make enormous sums from advertising and where they can help one another in the provision of programme material. Be that as it may, the question is: Where can one get a listening public of 75,000 people within a radius of 15 or 20 miles of towns of 10,000 or 15,000 people throughout Australia? It simply cannot be done. Throughout the whole of northern New South Wales, embracing five federal electorates, we have only about 250,000 adults. Therefore, we must make certain that we get these considerations clear from the beginning.

Sir Wilfrid Kent Hughes:

– Micro-waves can be used to extend the range.


– Those who are better acquainted with the technical side of the matter can explain various methods of extending the range of television broadcasts. We know that micro-waves are useful in this respect.

It seems to me that the most important initial step is to make certain that the national television stations are established at the right places. We must insist on the introduction of a nation-wide television system at the earliest possible moment. We are told that the establishment of a television broadcasting station requires an expenditure of £250,000. An operator would need to obtain an income of about £100,000 a year to allow him to offer decent programmes. How could he expect to get such an income in a sparsely populated area? It is for this reason that I suggest we should allow the national stations to service country areas that are not closely settled, leaving commercial stations to establish themselves in centres at which they can operate profitably.

This is particularly important because we must not allow all the available channels to be used in centres of dense population. Many of these channels, particularly those giving the widest ranges, should be reserved for country areas, in which they can be used most effectively. Television has one great advantage over radio; a television programme may not be received at places far distant from the point of propagation. For this reason, centres far removed from one another may use the same frequency channels without causing interference. Radio, on the other hand, has a very wide broadcasting range, and considerable interference may result from the use of the same frequency by two stations situated thousands of miles apart. If we fail to make a proper selection of sites for the various stations, leaving the matter to the chance granting of licences by the authority set up to deal with that matter, we will finally find ourselves in great difficulty.

At the very beginning we should adopt a sound approach, so that we will not make mistakes similar to those that were made in the 1920’s in regard to radio. We should keep in mind constantly the requirements of the people outback, for whom we have made special arrangements in the radio field, allowing them to obtain licences for about half the amount paid by people living in the more settled areas.

We must make the best possible use of the sites that are available for the establishment of television stations. We will find plenty of suitable locations. In my own district, for instance, there are the Dorrigo mountains, the Guy Fawkes and New England tablelands, Point Lookout, Ben Lomond, Mount Mitchell, Moonbi, Camelback, Anderson’s Peak and Barrington Tops, where stations could be established from which programmes could be broadcast over a very wide area, taking in, perhaps, some of the smaller coastal towns.

In my own experience as a doctor, I have found that if I want to learn a particular technique the best thing to do is to go to the place where it is being practised. It might be necessary to visit other countries and other surgeries to see the work being done. The United States of America and Canada are two countries that have about the same area as Australia. Although they have bigger populations than we, they still have vast areas that are sparsely settled. It seems to me that before we finally make up our mind how to spend our money, we should take the fullest advantage of experience in those places. We should send officers to those countries, to find out not so much what to do as what not to do. We must avoid the mistakes that have been made by others. The principles governing television and radio are the same the world over, and mistakes that have been made in other places can quite easily be made here if we follow the same procedures.

I suggest, therefore, that we should find out at the earliest possible moment the best way to go about introducing television to this country. This will help us to remove the discrimination between metropolitan and country areas which, I venture to say, is repugnant to everybody in Australia. If we do not approach the matter in the manner I have suggested, we are likely to find after a period of years that people, especially boys and girls and young married couples, will drift away from the country districts. Even wives who have been married for a long time may want to go to places where they can enjoy this amenity. It is quite possible that we will, in this way, adversely affect the whole of our settlement and development, which are vital from the point of view of defence.

If we are to hold this country we must populate it at the earliest possible moment. We must populate particularly the parts that are not settled at the present time. We have not developed our country as we should have done. We have not harnessed our rivers to obtain the power that is available from them. The great bulk of our water supply is situated north of the 32nd parallel. Most of it, in fact, is in the tropical areas. We have done practically nothing to make adequate use of those water supplies. We have only 400,000 people, in a population of 10,000,000, north of the 26th parallel, in an area comprising half the total area of Australia. We cannot hold our country unless we attract people to these areas for the purpose of developing them. One of the amenities we can provide is television. Our television programme affects the whole of Australia. It should not be considered from a limited, parochial viewpoint. The efforts of Australians, in developing this country, have been subject to the curse, as it were, of State boundaries. For goodness’ sake do not let us allow our television development to be affected by State boundaries! Let us put ourselves in a position at the very beginning in which we will be able to take advantage of every improvement that is being made in television techniques. Let us make sure that our television stations are located in places where they can do their job most effectively.


.- -1 could not agree more readily with the statement made by the right honorable member for Cowper (Sir Earle Page) that we should be concerned about the fact that there are hundreds of millions of people in countries to the north of us, many millions of whom are in want. I also agree that if we do not develop this country, those people, who look at Australia with hungry eyes, will come and develop it. I agree, too, that the main task confronting us is the development of our country. This is one of the reasons why I was very unhappy indeed about the Budget presented by the Treasure! (Mr. Harold Holt) on 16th August. Nowhere in the Minister’s speech did I find any really sound proposals for developing

Australia. Certainly there were some short references here and there to development, but, as the right honorable member for Cowper has said, we must do something big. We must think big. We have no time to lose. We must develop our country fully so that we may absorb population at an even faster rate than we are doing at the present time. Whether television will be of substantial assistance in this connexion I hesitate to say.

During the Budget debate some remarks have been made which I do not think have helped anybody. I have a lively recollection of the honorable member for Griffith (Mr. Chresby), resplendent in a bright red tie, using good radio time to read three pages of the “ Communist Review “. He read passages from Sharkey’s address to the eighteenth congress of the Communist Party of Australia, and other matters of a similar nature, to honorable members of this Parliament and also to the people of Australia. Whether the Communist Party does what was suggested by the honorable member for Griffith I do not know, and I do not care. The point is that the honorable member was simply trying to persuade this Parliament that the Labour Party is Communist-dominated. The honorable member pointed out that Sharkey had said that for various reasons the Communist Party had, during the years 1945, 1946 and 1947, decided that it should support the Australian Labour Party. That indicates only that the Communists had at least as much nous as the rest of the people of Australia. They realized that only the Australian Labour Party could implement such a magnificent war effort and save their skins, so, like the rest of the people, they supported the Australian Labour Party. But subsequently the Communists grew bolder. They thought that they had the Australian Labour Party in pawn and that something should be done about it, so we had the coal strike in 1949. And something was done about it. At the next election the Communists made sure of the re-election of the Menzies Government by affording it their support. They decided that their best interests would be served if a Liberal-Country Party government was in office, and they were successful in their efforts. One Liberal senator obtained his election on the second preferences of the Communist Party candidate.

Even at a municipal council election last Saturday in my own electorate neither the Democratic Labour Party nor the Liberal Party opposed any Communist Party candidate. We do not know what the agreement was, but we had to fight them.

Let me turn now to another aspect. The honorable member for Griffith and the honorable member for Richmond (Mr. Anthony) stated that to a large extent costs were being forced up by the trade unions, and that they must be reduced. I am fed up with the Country Party grizzling that although farm productivity has increased by 11 per cent, the primary producer’s return has decreased. I assume that the figures which Country Party members so often cite are official and are based on information supplied by the Commonwealth Statistician. When they blame the trade unions for inflation, or at least for a good deal of it, they must expect a reply from the Labour Party. I said that I assumed that the figures which have been supplied by the Country Party are official. But to me at least they are suspect because they can be compiled from one source only and that is income tax returns, to which the Statistician has access. The Statistician is able, of course, to obtain information about the incomes of farmers, plumbers or any one else. I say that the figures are suspect.

Let us look at the thirty-eighth report of the Commissioner of Taxation dated 1st June, 1959. Page 261 of the report relates to questionable returns. The first person on the list is a real estate agent, then there are three graziers, a butcher, a farmer and grazier, another farmer, a grazier and company director, a farmer and grazier, a taxicab proprietor, a farmer and grazier, a storekeeper, two farmers, a grazier, another farmer, a master butcher, a farmer, a bookmaker

Mr Lindsay:

– Do not forget that that report is two years old.


– I know that. I am merely pointing out that this section of the community is in the habit of understating its income because it wishes to appear poorer than it is. The list does not contain the name of any working man. What does this prove? The list of questionable returns contains the names of many members of the farming community because they are expert at submitting incorrect returns.

Mr Bandidt:

– Do not forget that one swallow does not make a spring.


– I do not want to have to cite the figures in relation to lawyers, so I should be glad if the honorable member for Wide Bay (Mr. Bandidt) would give me a good hearing from now on. As a class, lawyers are not as bad in respect of these matters as are farmers who are expert at understating their income.

Like the right honorable member for Cowper, I am disappointed with the Budget because it does not offer any prospect for development. The Budget has been severely criticized, not only in trade union quarters, but in many quarters. I should like to read from the address of the chairman of directors of Sherbourne Investments Limited - a Capel Court company - at its 10th annual meeting, on 29th August, 1960. He said -

The long-awaited Budget speech delivered by the Commonwealth Treasurer, Mr. Harold Holt, on 16th August, did little more than touch the fringe of the economic problems confronting Australia. It was long in generalities but short in practical realism. Consequently, it has proved a profound disappointment to those who hoped for strong Government leadership and stern and effective measures to check the great speculative boom which had been in progress in Australia over the last few years.

That is a statement by the chairman of directors of a finance company. We must give some credence to it as we must give some credence to reports contained in other financial publications. The address continued -

After this general survey, it is important to examine in some detail what the Government had to offer in the form of practical measures to curb excessive expenditures, restrain cost and price rises, temper the boom and bring the general economy into proper balance. It is here that the disappointment commences as, apart from the measures announced last February, the only new contribution to the solution of Australia’s problems was the announcement of a moderate increase in company and personal tax rates.

The chairman of the company stated that the Government had announced last February - in the Governor-General’s Speech - that it proposed to implement four measures to curb inflation. The Government admits now that there is and has been inflation. Later I shall reply to Government sup porters who have asked us what we would do about it. The Governor-General said in his Speech -

My advisers have informed me that, whilst employment and production are high and increasing and all branches of trade are active, there are trends in the economy which have been causing them concern. In particular, costs and prices have been rising at an increasing rate. My advisers believe that if these were allowed to continue it would bring needless hardship to a great many people and it would imperil the stability upon which the further growth of Australia depends.

I could not agree more with His Excellency. But the fact remains that inflation has continued and the measures which the Government proposes to take will be completely ineffective. As the first step in its plan, the Government said that it would intervene in the hearing of an application by the unions for an increase in the basic wage. In fact, the Government hastened to intervene, with the result that the worker did not receive an adjustment of the basic wage commensurate with whatever might have been the court’s finding with relation to the increased cost of living. We often hear it said, whenever there is an industrial dispute, that the workers should accept the verdict of the umpire. I can only say that in my opinion the umpire has been got at in this instance. By its intervention before the Commonwealth Conciliation and Arbitration Commission, the Government got at the umpire. To expect the workers to have faith in the commission after that intervention is futile. That action could be likened to the Victorian Football League’s saying to one of the umpires in last Saturday’s match - which, believe me, was a very good one, and one well worth visiting that State to see - “ It is not in the best interests of the game that team A should win even though the rules clearly indicate that it did win “. Such an action would not engender faith in that body. In the same way, the Commonwealth Government’s action in intervening against the workers does not engender faith in the Commonwealth Conciliation and Arbitration Commission. I repeat that in my opinion the umpire was got at on that occasion and probably the less we hear about the workers accepting the decision of the umpire from now on, the better.

When chiding the Leader of the Opposition (Mr. Calwell) last week, the Prime Minister (Mr. Menzies) said, “ Of course there will be inflation while the present rate of development and expansion continues “. In fact, he indicated that in those circumstances there must be inflation. Then he asked. “ What would you do about the situation?” My answer to that is that when the Labour Government was in office it did do something about inflation. It is also suggested that there will be inflation as long as there are shortages. The Prime Minister also asked, “ What would you do - go back to the days when you were in office, back to the days of shortages?’ I admit that there were shortages, and extreme shortages during those days, but the point 1 make is that the Labour Government did handle the situation then. Inflation did not gallop during the Labour Government’s regime at the rate at which it has been galloping during the past ten years under the present Government. The reason for that was rightly stated by an honorable member to-day who pointed out that we pegged wages while at the same time making provision for a review of th? situation and that we also tackled the other and more important ingredient of inflation - rising prices. This Government knows, as it has always known, that unless an attack is made upon rising prices, we cannot hope to halt inflation. Of course, this Government argues that it has not the power to control prices. Only yesterday the Prime Minister clearly dodged the issue when he stated that he would not give aid to denominational schools because the Commonwealth has no power to deal with education. His continual cry is, “ We have not got the power to do it; we have not got power over education; we have not got power to provide for hospitals; we have not got power to do this, that or the other thing “. But I remind the Committee that during the last ten years, and, with the exception of the short period when Labour was in office, during the twenty years prior to that, anti-Labour governments would not seek the power. I also make the more important point that the Constitutional Review Committee, an all-party committee of this Parliament, has made many unanimous recommendations for the amendment of the Constitution, subject to the will of the people.

Mr Duthie:

– And the Government put them in a pigeon-hole.


– One day last week I asked the Attorney-General (Sir Garfield Barwick) what the Government proposed to do about those recommendations. I asked whether they would be considered. I was told that the Government would consider them, and. I have no doubt that, as is suggested by the honorable member for Wilmot they will be pigeon-holed after they have been considered.

Another statement in the GovernorGeneral’s Speech was -

The development of tendencies to monopoly and restrictive practices in commerce and industry has engaged the attention of the Government which will give consideration to legislation to protect and strengthen free enterprise against such a development.

Last week. I asked the Attorney-General what had been done in this direction. I asked whether such legislation had been considered and whether we were likely to have an early announcement in connexion with the matter. The Attorney-General assured me that the matter was still under consideration. As we all know, the honorable gentleman is going for a little jaunt overseas shortly and we can rest assured that the matter will still be under consideration when the next election date comes around. If the Government is returned at that election. I venture the opinion that the matter will still be under consideration when the subsequent election is being held because the Government has no intention of dealing with restrictive trade practices. It has no intention of dealing with the monopolies which are exploiting the people.

In my opinion, this Government has no intention of correcting inflation or of putting value back into the £1. If it ever did have that intention, it has made a very poor fist of giving effect to it. Why should this Government, representing the interests that it does, seek to put value back into the £1? Is not putting value back into the £1 tantamount to granting an increase in wage rates? Does it not mean giving the worker more purchasing power for the same amount of money? Can I see this Government ever doing that? Not on your sweet life! Putting value back into the £1 would also mean putting something back into the pockets of those who are in receipt of fixed incomes, the people living on annuities, to whom reference has been made so often. It would also mean increasing the value of pensions. Tn those circumstances, it would be very dangerous indeed from the Government’s point of view to put value back into the £1.

The Budget does contain some little benefits which might be termed hand-outs and these are giving a certain degree of pleasure to some people but, if we take the Budget as the official announcement of the Government’s intentions, it must be admitted that it contains many more disappointments than benefits. Certainly the Government is granting an extra 5s. a week to pensioners but we all know that the value of this additional 5s. will be lost to those people by the rising spiral of inflation and increased costs. Probably it will be lost to them before this session of Parliament ends. However, we are thankful that the Government is giving the pensioners something. I remind honorable members that when the Treasurer introduced the Budget of last year I expressed the fear that the 5 per cent, rebate in income tax which was then announced and which gave more to the man on the higher income than it did to the person on the lower income, would be withdrawn within a very short time. It is on record that I said that it would have been much better, instead of reducing income tax by 5 per cent., to have increased pensions. It seems that, after twelve months thought, the Treasurer has decided to do that. So, the pensioners get a little handout.

No additional amount has been provided for education. In the long run. the best means of defending Australia will be to have an educated population. About 30 years ago the Communists in Russia made the greatest investment that they ever made - an investment in education. They spent four times as much per head as we were spending on education. So, they trained large numbers of technicians, scientists and others, and that policy paid off in one generation. In my view, it was not their political philosophy or their way of managing and developing their country that gave them the great advantage; they gained that advantage because they recognized the paramount need for education and the training of scientists and technicians.

Mr Whittorn:

– We have raised the vote for education from £7,500,000 to £11,000,000.


– I know. You talk in terms of cash. But the vote for education is still only 2 per cent, of national income. Of the Victorian Budget, 27i per cent, goes to education. No matter what amount of depreciated currency is spent, it is the bricks and mortar and teaching staffs which go into education that count. The situation is serious. If we are to survive, apart from developing the country we must have the necessary technicians and the scientists. We cannot get them on the cheap in the face of what the Communist countries are doing and the percentage of their budgets that they devote to education.

Mr Jess:

– How did your caucus meeting on education go to-day?


– Unlike you, I do not talk out of school. Probably, when you have been here long enough, you will learn not to talk out of school. You are still wet behind the ears. You should state your policy on education. Do you deny the necessity for a greater percentage of the total income to be allocated for education? If it were known in your electorate that suggestions on education by other honorable members merely meet with sneers from you, your constituents would probably know how to deal with you.

This Budget would have been much better had provision been made in it to help the States with street and road construction, and sewerage and water supply undertakings. The Opposition is disappointed that the Government has not indicated that it has any proposals in relation to these things. So far as hospital and medical services are concerned, we still hold the view that these should be made freer and better for the people.


.- I am very glad that the honorable member for Darebin (Mr. Courtnay) made some remarks about communism and industrial administration because I would like to join issue with him on those subjects later in my remarks. I want, now, to say something about the Estimates of Receipts and Expenditure because this is the Budget session. It is traditionally the time at which the Government gives an account of its treasurership for the past twelve months. I think, too, that the taxpayers look to the Opposition, at this time, to see what financial proposals it would implement if it were in government. The fact that the Leader of the Opposition (Mr. Calwell) has moved that these Estimates be reduced by £1 indicates his wish that, through a vote in this chamber, the Government should be compelled to stand down and allow the socialists to implement the policy which he announced in his speech on the Budget.

What did he suggest as Australia’s fiscal policy for 1961? I think it can be summarized in three words - “ Amend the Constitution “. According to the Leader of the Opposition, all our troubles begin with this Constitution of ours. According to him. altering the Constitution would be almost as simple as turning on and off the light. But he knows that that is not the case. He knows that, over a long period of time, it has been impossible to get the States to agree to alter the Constitution. That has been the experience of Labour and Liberal governments alike, and the position is not likely to alter in the future.

In truth, I thought that the speech of the Leader of the Opposition was most depressing. I suppose that that must be understood because he was so long associated with his predecessor, the recent honorable member for Hunter, that he cannot help being an apostle of pessimism. Indeed, I thought that he set the pattern for the speeches of the whole of the Opposition. We are becoming accustomed to these cries of woe but on this occasion, I think that the cry from the Opposition benches has become a little more muted and unconvincing. I think that the Opposition is clearly discomfited by the fact that the economic disaster which was foretold by the previous Leader of the Opposition on many occasions is very slow in arriving. It must be very disheartening for many members of the Opposition to see their new leader following the path which was travelled by Dr. Evatt and offering nothing new and nothing constructive in financial thinking for the country’s future, but only a dismal dissertation on calamity!

At Budget time, we look naturally to the indexes and indicators and I think we tend to be concerned primarily with those things that we can measure. As the Opposition has made no reference to these, nor to the ever-serious rents in our social fabric, I propose to make some brief reference to them. I think that the document, “ National Income and Expenditure 1959-60”, better known as the “ White Paper “, is a clear indication that we are enjoying more amenities to-day than we have ever enjoyed before. Those amenities are spread over a greater number of people than ever previously in the history of the Commonwealth. The White Paper shows that expenditure on electrical goods which includes television receivers has been a major factor in increases of personal consumption and that this expenditure has increased by a substantial 18 per cent. The gross private expenditure on fixed capital equipment during the last twelve months has been staggering. Expenditure on station wagons and cars has risen by 26 per cent. That figure is £56,000,000; and the number of new trucks registered increased by 15 per cent. Average earnings in the last financial year rose by 7 per cent, compared with those in the previous year and, in the latter part of the year, by 9 per cent., while total employment was about 3i per cent, higher for the year. You cannot just dismiss all those facts with a wave of the arm and say: “ These things mean nothing. The country is in a deplorable mess and we do not enjoy prosperity.” Such a statement would not be true. The question that the taxpayer must ask himself to-day when considering the proposals made by the Opposition compared with those of the Government as set out in its Budget is: “ Can I live more securely under a government controlled by the Leader of the Opposition? Would I have more security under his control, or would I have more security under the present Government? “

Perhaps the most sobering thought that the Leader of the Opposition (Mr. Calwell) put forward during his speech came towards the end of his discourse, when he said, “ Free enterprise will destroy this country “. I suppose I can add the sentence which he left to our own imaginations - “ When I return I will replace the present system with my own doctrine of socialism, because I believe in socialism “. Strange as it may seem, outside the leading Communists of this country, those who wish to see this country completely socialized have never seen a completely socialized country at work. I hope to say something about that matter at a later stage. In the meantime, let me say that the White Paper from which I have just quoted is a most interesting document, lt clearly shows that we have more motor cars, television sets and refrigerators than ever before. We are spending more money than previously on tobacco, cigarettes, beer, food and housing. More housing has been erected in the last twelve months than ever before in our history.

But it is in the complacent atmosphere created by those thoughts that I want to strike a rather sour note, because all the amenities mentioned in that White Paper to which I have referred are what might be described as cash register standards. I concede that they are indicators of Australia’s prosperity, and that the country is doing well; but it is our human standards which, I submit, are thoroughly out of balance. Matters such as these fall under no convenient heading at present for national discussion. It is hard to get any attention paid to these things to which I have referred, particularly at present when we live in prosperous times and people are considering the question of man’s first flight into space and matters such as that. They are, of course, none the less vital, but I think budget time is the time to stop a moment and consider some of the human standards.

I want to refer particularly to some of the rents, as I call them, in our colourful fabric of to-day. I describe them as matters of very great moment. I wish to discuss them under two headings; the gullibility of labour and the apathy of management. I say that labour is gullible to-day because after all the direct experience that the trade unions have had in this country of the intention of the Communists to destroy, one would think they would have learnt something. But the fact of the matter is the unions have learnt nothing and because of this the Communists, in some important trade unions, are carrying on their corrosion with great effectiveness - an effectiveness greater than ever previously. This, to me, is a serious matter for Australia, because T believe that many of our economic problems to-day start right at that particular spot.

Never since the war, in all probability, have we had in this country fewer card- carrying Communists. Possibly never since the war. in this country, have these few people been so well placed to cause havoc in our community. The schism in the ranks of political Labour has resulted in thwarting the efforts of apparently the only force in the trade unions which had the means and the backbone and the will to stop Communism. In the meantime, one can appreciate the confidence that this has given to the Communists, who have changed their ways and their techniques, but not their objectives. Among the changes so noticeable to-day is a tendency to offer Peking as the workers’ paradise rather than Moscow. There is a very marked reluctance these days to admit to any more identification than a unity ticket. One thing which is not changed is the clear and deliberate preference that Communists have for singling out the transport unions as their number one objective. It is most alarming that, once again, Australia, in a very critical time of our development, is beginning to have transport hold-ups cutting right across the whole course of industry and bringing quite a disproportionate burden of costs to our economy.

I say that this is at a critical time, because we have a great opportunity at this period in our history to make some progress in our export markets. Indeed, we must do so, if we are to overcome some of our difficulties with regard to overseas balances. We cannot rely on foreign capital to come to our relief all the time. I have in my hand some estimates made in the Department of Labour and National Service, which show that in the first six months of this year 295,000 man-days were lost through industrial stoppages. If we take it over the whole range of employment, the loss for the first six months of this year was equivalent to a loss of roughly threequarters of an hour working time per worker. The principal increases this year in lost man-days occurred in the stevedoring, rail, shipping and shipbuilding and repair industries.

Another thing which has not changed is the cynical Communist doctrine that the workers in the West - and of course that means Australia - must be deceived into working less and less, yet workers in Communist countries are dragooned into working more and more. That is the most amazing aspect of these tactics of trying to deceive the worker in Australia to-day into working less while we know definitely that in Communist countries the workers are dragooned into working more and more. I was in several of the industrial satellite countries in Europe last year - countries which are completely socialized and communized - and there was no nonsense there about a 35-hour week. There were no technical disputes about dirt money on a building job, or passionate claims for more and more leisure. None of those things operated in those countries. Communist Europe to-day is a 46-hour week, three shifts a day country - a labourer’s paradise, if you like to call it that - where the unskilled worker works two full shifts to get the price of 1 lb. of butter. Do not forget that Communist Europe is a place where everyone works and, when I say “ everyone “ I mean everyone. In one Communist country married women with families worked. They must work, or else they do not eat. It is just as simple as that. The price that these people pay for their Communist mobilization is frightening. Their productive output is enormous and their ability to undercut the cost structure of this country, as I was reminded by a leading Communist, is no mere figment of the imagination. Make no mistake - the workers in these satellite countries get no benefit from this cheap production. It is used for other purposes. It is used to further propaganda in Western countries, including Australia. Yet, in spite of this, there are many areas in the Australian trade union movement where Australian workers, who already possess one of the finest living standards in the world, are being persuaded to envy those poor devils who sweat for a Communist boss. Day by day, publications of Australian trade unions are coming up with references to the great achievements of the people’s democracies in the red countries, while achievements in this country go unremarked. That is putting into practice an old axiom - “ Never advertise your opponents “.

Management in Australia actively helps Communists in some cases. This is where I come to the second portion of my remarks, in which I referred to the apathy of management. I do not think those in management help Communists willingly. However, it only highlights the seriousness of the breach when they do it in ignorance.

The Victorian branch of the red-lining Australian Builder-Labourers Federation was recently able to send its members its fine new monthly magazine called “ Unity “, complete with two special feature pictures, the only ones in the publication except for a couple of portraits. One showed a union official in Moscow, and the other showed a new auditorium built in Peking. The Communist-line propaganda running through the magazine ranges from the fairly subtle to the frankly crude. But this is the staggering thing: This well-prepared 68- page publication printed to the greater glory of communism would never have been possible if it were not for the fact that no fewer than approximately 100 different advertisements, paid for at a very handsome rate, carry some names that are the very embodiment of Australian capitalism. This prompts me to ask: Are the managers of the companies and firms concerned so sure that the Communist influence in this union is harmless? Are they so careless of their money that they do not bother to check where it goes? Or are they so concerned to have peace at any price that they pay up and shut up and let their money be used to glorify the work of the Chinese reds?

To the Australian workers I suggest that this is the time to stop being gullible. There is work to be done here in Australia, make no mistake about that - work to be done in improving still further the standards that already make us the envy of the world. If they think that the healthy state of the economy is good background to a Communist plea for shorter hours, they are making a most dangerous mistake. The fact is that countries everywhere, and particularly those that I visited, are pushing up production at a faster rate than we are, and if the reds can. by propaganda, slow us down, they will bring us much faster to the day when liberty and still more liberty will be lost in this country. To Australian management I suggest that apathy has crept into some surprising places. Wherever management is supine in allowing Communist propaganda to make a lodgment it is doing a disservice to Australia.

Now I would like to say something briefly about our export trade from another angle, because we are all anxious to see our European, and perhaps particularly our South-East Asian, markets develop to a greater extent than they have in the past, since this type of business can help our overseas balances which can do such a lot towards reducing inflation. I am sure that the Australian trade ship to visit SouthEast Asian markets in March, 1961, will enjoy the blessing and carry the good wishes of all honorable members, but it will require more than just good shop windows and good salesmen to sell our products and build up goodwill in the East. It will require bold and vigorous methods in regard to enterprise.

The management in this country that waxes fat and stagnant by seeing nothing else but the home market, and ignores the challenge of exports, does Australia a very great disservice. In the past industrial management, generally speaking, in this country has not been export-minded. Those in management want export business when the home market is quiet, but are prepared to ignore and treat the overseas customer with scant courtesy when the home market is good. The Department of Trade, as we know, is spending large sums every year in bringing overseas buyer and Australian seller together. Too often the seller becomes indifferent to following up the contact, and so another potential customer is lost to Australia. There is a challenge in these days right here at our doorstep. It is an economic and political challenge.

I urge the Parliament to get to grips with the problem of expansion on a sound foundation. It is a matter of regret to me that the Treasurer found it necessary to limit funds for a number of projects, in spite of existing agreements with the States. I am sorry he has not been able to implement fully the Hume report on depreciation for income tax purposes, because anything that will help industry to meet, more favorably, our overseas competition, should be encouraged by the Government and the Treasury. Time will not permit me to develop that argument, but I think honorable members will agree that anything that will tend to retard inflation, build up our export markets and reduce costs, such as automation and the use of better knowhow, is all to the good.

Finally, I urge the Parliament to get our problems of expansion into sound perspective. We live in a world which is thrusting forward at a spectacular rate, and we must keep abreast of that pace. Millions of people just north of us are losing more of their liberty every day in the interests of greater production and greater development - something we have to learn more about. Capitalism and democracy are being seriously challenged by hard-working Communist countries. If we heeded the arguments of honorable members opposite we would not believe that that is the position. We cannot remain here in a South Seas paradise indefinitely with a rate of national expansion below that of so much of the world, and still retain our present living standards. The plea that I make is that we do more with our natural resources and make more of our national purpose. All that labour and management can do towards bringing about a happier state of affairs should be done, and I believe that both labour and management should take a greater interest in the affairs of the unions and of industry. I support the Budget because I believe it is a good budget that will improve present conditions.


– Despite the enthusiasm of Government supporters, the Budget has not produced any favorable reaction throughout the community. It is not surprising, therefore, that Government supporters have sought to draw red herrings across the trail and have spoken on any subject but the Budget. Fully half the speech of the honorable member for Isaacs (Mr. Haworth) was a dissertation on the red peril. Other honorable members on the Government side have spoken on similar lines, but I suggest that their duty was to discuss the merits or demerits of the Budget. Although the honorable member for Isaacs did not devote much time to the Budget, I found that I could enthusiastically agree with one of his remarks. He said that the world is thrusting forward at a spectacular rate. It is because of this that the Australian Labour Party disagrees with the Budget. The Budget will result in the country going backward and not forward. At a time when Australia is in the throes of the greatest expansion in its history, one would have thought that the Government would have introduced a Budget to help our development. But we have nothing but a document of complete pessimism, of reaction and inaction. The Labour Party, therefore, is totally opposed to it.

The proposals in the Budget, with one or two minor exceptions, are of no practical value. It fails to deal with so much of vital consequence that the Treasurer (Mr. Harold Holt) could have explained it in five minutes; yet his Budget speech extended over one hour. In an attempt to cover the paucity of the Budget, he delivered a wordy dissertation on the economy; but this was merely a collection of meaningless words. The Budget reveals that the Government has a marked reluctance to come to grips with the problems facing Australia. For instance, it does not provide for a stepping-up of work in the public sector. We all know that public works are years and even decades behind requirements. We read almost daily of the plight of municipalities, which have no money for road construction. We read of the plight of the Melbourne and Metropolitan Board of Works. More than 85,000 houses in Melbourne are unsewered and there is no prospect of many of them being sewered for eight or ten years. One would have thought that the Government would have provided1 a stimulus for the public sector, but there is certainly no stimulus in this Budget.

The community will wait in vain for a system of social services based upon social justice. In plain English, the Government is loath to legislate so that the people can share in the nation’s well-being. But, on the other hand, the Government allows monopolies, cartels, share market operators and land boom speculators to exploit the economy. The Treasurer provided in this Budget for a surplus of £15,500,000. Every one knows that the surplus will, of course, be much more, if the results of previous Budgets are to be taken as a guide. This Government always cries poor when a Budget is introduced, but the results twelve months later present a much happier picture. I can understand why the Treasurer is crying poor now. He does not want to give the recipients of social service benefits and others in the community their just rights; he wants to hang on to the money so that next year, on the eve of an election, he can distribute largesse to every section of the community and so regain the treasury bench.

The proposals contained in the Budget are hardly worth mentioning. The increase of 5s. a week in pensions just beggars description. The reductions of sales tax are not worth considering, because they affect only one or two items. The standard of living will not be improved at all. I was interested in a comment made by the Treasurer during a television interview in Melbourne on Sunday evening. When he was asked whether he thought the pension was enough, he said in his opinion the pension has never been regarded as other than a supplement to the pensioner. He went on to say that the community has a right to expect the family of a pensioner to accept responsibility. They are his words. However, I should like to know what happens to a pensioner who has no family or whose family is in impecunious circumstances, and there are thousands of such families.

The Treasurer is prepared to justify his actions to-day by the precedents of the past. Whilst we have governments doing that, there is no hope for the country. It is because we wish to alter precedents that the Parliament meets regularly. We frequently amend health acts, aid roads acts and other acts. In doing this, we cast aside precedents and bring legislation up to date. But the Treasurer is not prepared to do this with social services. When honorable members opposite talk about prosperity and the number of refrigerators, television sets and motor cars that are bought, surely they realize that in an enlightened and civilized community the pensioners are entitled to some share of the prosperity. However, the Treasurer considers that pensioners should supplement their incomes from other sources; but every one knows that the pension is the sole income of 78 per cent, of pensioners. Whilst this Government remains in office, with its outmoded approach to assessing a pension rate, there is no hope for pensioners as a class.

I now turn to another section of people who receive social service benefits - the parents of children, and others who receive child endowment. I find it incredible that the Government is not prepared to make a positive contribution to the well-being of families. In the television interview in Melbourne which I have mentioned, the Treasurer was asked to explain what the present Budget did for the family man. As usual, the right honorable gentleman dodged the question. He said that wages had increased by a greater degree than had prices over the last twelve months and that that factor had assisted the family man. 1 point out that it also helped everybody who had no family responsibilities, if that argument is correct. This Budget does absolutely nothing to help families. Everybody knows that, as the cost-of-living figures show, the cost of feeding and clothing a family is more now than it was twelve months ago or two, three, four, five or six years ago. After all, the last increase in child endowment was made in 1950. when this Government provided for the first child.

I should have thought that at long last the Government would have increased income tax concessional allowances for the family man. The same rates of deductions for a spouse and dependent children have operated for a number of years now - £143 for a spouse, £91 for the first child and smaller amounts for subsequent children. Surely the Government realizes that the family is the basis on which the future prosperity of this country depends. Yet it expects a family man with four or five children to carry on as best he can under the most difficult of circumstances at a time when, in the Government’s own words, this country is enjoying record prosperity.

This Budget imposes the heaviest burdens on the people who are least able to bear them, lt is based on the four fundamentals of policy in relation to inflation which were laid down by the Prime Minister (Mr. Menzies) last February. The Government decided that it would intervene before the Commonwealth Conciliation and Arbitration Commission and oppose an increase in the basic wage. In other words, it decided to peg wages. Yet it says that it is not a low-wage government and that it does not believe in the reduction of wages. I put it to the committee that if prices rise, as they have done since last February, and wages remain pegged, the result is tantamount to a decrease in wages, because they now buy less than they bought last Feb ruary. Therefore, if the Government consistently opposes wage increases while prices are rising, it is definitely a low-wage government.

The Government’s action in opposing the application for an increase in the basic wage before the Commonwealth Arbitration Commission last February was bad enough, but even worse is to follow. I refer honorable members again to the television interview in which the Treasurer took part last Sunday. When he was asked whether the Government would intervene before the commission again to oppose an application for a wage increase, he said that it would probably send a legal representative to the commission again to make certain submissions. Does that mean that next January or February, when another application for an increase in the basic wage is heard, the Government will oppose the application?

The C series index shows that the federal basic wage in Melbourne lags 27s. a week behind the point at which it would stand if it had been adjusted in accordance with the movement of the cost of living. By next February, the difference may be well over 30s. a week. Does the Government’s attitude mean that the workers have to wait for another eighteen months or two years for an increase in wages although prices are rising all the time at an alarming rate? The Government pegged wages and has virtually announced its intention to oppose applications for wage increases in the future before the Commonwealth Conciliation and Arbitration Commission, but it has no definite policy on the fixing of the prices and profits of monopolies. It treats monopolies like sacred cows and will allow no one to touch them.

As I mentioned a few moments ago, this Budget follows the broad programme of the economic policy measures announced by the Prime Minister earlier in the year. An examination of events since the implementation of those policies indicates that they are definitely and unequivocally working against the interests of the average citizen. I have already pointed out that since the basic wage was pegged, the cost of living has risen by 27s. a week in Melbourne alone.

I shall now discuss the relaxation of import controls. The Government and the Treasurer have not denied that the relaxation of those controls will result in a whittling down of our overseas reserves. At a time when we should carefully preserve those reserves in order that they may be used to counter an emergency brought about by circumstances outside our control, this Government, by deliberate intent and of its own volition, is whittling our overseas reserves away. T suggest that the position is not so bright that there could not be a catastrophic fall in prices. Yet. instead of conserving our overseas reserves in order to protect us against such a happening, this Government is dissipating those reserves of its own accord, although there is no need to do so. Our overseas funds are expected to be reduced by about £150,000,000 during this financial year. Our imports, allowing for freight and insurance payments, seem certain to total £1.200.000,000 during the financial year, and I ask the Government: Is there any guarantee that our exports will balance this level of imports? If not, our overseas reserves will be systematically drained away. Furthermore, if prices rise more rapidly in Australia than overseas, our balance-of-payments difficulties will be accentuated. I urge the Government to look very carefully at this policy which already has allowed our overseas reserves to start crumbling away, and I appeal to it to stem the tide of imports in time.

Apparently, the Government’s attitude is one of smug complacency. It is just hoping that things will turn out all right. However, I want to give it a word of warning. As the import position stands at present, everything clearly will not turn out all right, and the Government should carefully conserve our overseas balances, because there could rapidly come a time when those balances would be needed to meet contingencies that would1 not be of our own making.

The third item of the anti-inflation policy embraced in this Budget is the restriction of bank credit. Other speakers from this side of the chamber have said before - and I say it again, because it will bear repeating - that this Government imposes no restriction on credit for hire purchase. It is true that two or three years ago the

Prime Minister exhorted the hire-purchase interests to pull in their horns and limit their business a little. But nobody took the slightest notice of him and his appeal failed lamentably. At a time when the workers are feeling very bitter about the pegging of wages, the Government pursues a policy of restricting credit in a way which militates against the workers, because- this restriction of credit has diminished the scale of many essential developmental enterprises, both public and private, as well as other works in the social welfare sphere.

I am associated with a hospital in Melbourne which was opened a month or so ago by the Premier of Victoria with a great fanfare of trumpets. However, that hospital is treating only a quarter of the patients that it could treat, and will do so for another three years. The hospital building itself is completed, but we have not enough money to provide a nurses’ home and the nurses have to be accommodated in the hospital building. The Victorian Government can give us only £300,000 in this financial year as a contribution towards the capital cost of providing a nurses’ home - probably about £600,000 - and the Victorian Hospitals and Charities Commission has told the authorities of this hospital with which I am associated that they may have a letter from the commission giving an undertaking that a further £300,000 will be available next financial year if such a letter will help them to obtain a loan for that amount from a private lending institution. Because of the restriction on bank credit we are unable to obtain a loan of £300,000 to finish a hospital project.

Mr Duthie:

– An essential work!


– A most essential enterprise. There is no money available to build hospitals to cater for the sick in the northern suburbs of Melbourne, but there is plenty of money for the building of luxury hotels and for luxury enterprises of all kinds. Surely the Government does not call its financial policy the acme of statesmanship! It is an absolute disgrace that in a civilized community a hospital building project has to languish for the next three years because £500,000 or £600,000 cannot be obtained to complete the nurses’ home.

Surely the Government should be able to make money available to the States to carry on necessary projects of this kind. But the Government says, “ No, we have to restrict credit”. There is, however, no restriction on hire-purchase activities. As the honorable member for Werriwa (Mr. Whitlam) said in his speech during this debate, bank advances have increased by only 54 per cent, during the last seven years, while hirepurchase advances have increased by more than 500 per cent. The Government cannot justify that kind of development. No wonder honorable members opposite are talking about anything but the Budget in this debate. The honorable member for Isaacs (Mr. Haworth) spent his time talking about the red peril, instead of telling us why the Government fails to provide money for hospitals.

The Labour Party is frequently asked whether it has any constructive suggestions. The Leader of the Opposition (Mr. Calwell) made what was surely a most constructive suggestion, when he asked what was wrong with holding a referendum for the purpose of providing the Commonwealth with additional powers. The honorable member for Isaacs must have read my mind, because in what appeared to be an attempt to forestall me he said that the whole history of referendums on constitutional changes shows a disinclination on the part of the people to agree to such alterations. He pointed out that only four proposals have been agreed to out of about 30 that have been submitted to the people. But I would also say that the history of referendums has been one of party politics. When the Government of the day has brought forward referendum proposals for constitutional changes, the Opposition has automatically opposed them.

Tn this case we have a new approach. The Government appointed a Constitutional Review Committee a couple of years ago because it realized that it did not have the power to deal with many formidable problems confronting the nation. Why did the Government appoint the committee? It did not do so merely as a joke. It appointed the committee because it realized that an alteration of the Constitution was necessary if it was to acquire the necessary power to tackle national problems on the national plane. The committee, from what I have heard and read about it, worked very well and amicably. In almost all of the recommendations the members of the committee were unanimous. There were one or two exceptions, when a unanimous vote was not recorded, but practically all the recommendations were agreed to by all members of the committee.

It appeared that we had reached a new era, in which the recommendations would be brought before this Parliament and no doubt endorsed by honorable members on both sides, and in which for the first time referendum proposals for constitutional alterations would have gone to the people bearing the imprimatur of approval of all parties in the Parliament. But as soon as the report was presented the Government got cold feet, realizing that acceptance of the proposals by the people would mean that the Commonwealth Parliament would have substantial powers that it does not now possess. Surely the Government can realize that it cannot control hire purchase unless it acquires the power to do so. Surely it must realize that it cannot control interest rates unless it has the necessary power. The Labour Party is prepared to co-operate with the Government, but the Government says no. Like Pontius Pilate it washes its hands - in this case, of hire purchase. It cannot expect the people to accept restrictions on bank credit and on wages when it allows unbridled licence to those who control hire purchase and interest rates.

The Labour Party’s support of constitutional reform is, I suggest, a tangible and practical proposition. We are prepared to go on the platforms and sit alongside Government supporters and advocate these changes. Imagine me sitting on a platform alongside the honorable member for Mallee (Mr. Turnbull) and putting forward, with him, a case for the granting of greater power to the National Parliament. I would even go on the platform with the honorable member for Hume (Mr. Anderson) and put forward these proposals. It would take a bit of doing on my part, but I would be prepared to do it for the Australian people, because I believe that the salvation of the Australian people and the solution of many of our problems lies in the granting of additional power to the Commonwealth.

The Government must have had this in view when it appointed the committee. If not, why was the committee appointed? Was the appointment only an act of humbug? The Government must have had some purpose, and I am prepared to believe that its motives were sincere, and that it is now suffering cold feet. I deplore this, because it means that the Australian people will continue to suffer, as they are suffering now, because of the inaction of the Government.

Looking through the Budget and the Treasurer’s speech, I find no mention of any intention to get on with the job of really developing the Northern Territory. This is an absolutely essential task. We all know that we must develop the north if we are going to keep Australia inviolate from the hordes of people in countries to the north of us. Everybody deplores the drift of population from country areas to the cities. This is of particular significance for the Australian Country Party, but there is no scintilla of evidence that the Government is even aware of the problems associated with the drift of population, and of the need for decentralization. The Government is making no effort to solve the problem, and Country Party members are strangely silent.

No mention is made of any effort to deal with the relative decline of food production in relation to population. We have been given the statistics in this connexion. Food production is falling while population increases, but no effort is made by the Government to correct this: situation, and we hear no word of protest from the Country Party.

No hope is held out in the Budget of eliminating the monetary crises that arise from inflation. The people can, expect nothing in this direction. The Government talks of the necessity to save money, but the only sign that the Government gives of trying to economize in its own spending is by cutting expenditure on the Snowy Mountains scheme, the one national venture that appeals to public imagination. This scheme should be assisted with additional finance, but instead the Government has cut expenditure in this direction.

Despite the fact that the ratio of motor vehicles to population in Australia is one of the highest in the world, the Government still balks at a national roads plan. Our roads are overcrowded, with additional vehicles coming on to them every day. They are too narrow and are crumbling away. While the Government gets tremendous, amounts of revenue from sales tax on vehicles and spare parts and from the petrol tax, it still balks at the first hurdle of a national roads plan.

Throughout the Budget there is an atmossphere of pessimism and lethargy. Some of the most pessimistic statements of all are those referring to the bleak outlook for loan raising. The Treasurer realizes that he will raise much less money in loans this year than he did last year. What does the Government intend to do about this situation, which is very serious? Because of the lack of response to public loans we find that basic community services are being starved of finance. While there is an increase of funds for private investment, there is a decrease in the amounts for public investment. But this Government does nothing about the situation. In the last twelve months there has been an increase of 1 per cent, in the amount of funds for private investment - from 17.2 per cent, to 18.2 per cent. In the same period the amount available for public investment has increased by .1 per cent. - from 8.4 per cent, to 8.5 per cent. We cannot have private expansion without public expansion. To-day there is no balance between the two. Factories are going up all over the place, and money is being spent in very many other ways in the private sector of the economy, but public services cannot keep pace. The two must proceed together. This Government, however, has not a clue as to how to raise sufficient money for the provision of public services, such as water supplies, hospitals and a hundred and one other services of a public character. Surely the Government realizes that an expanding economy demands expanding public services. While funds are diverted to avenues of investment, public authorities are being starved of the finance which is vitally needed to provide essential public works.

I have already mentioned the ample funds which are held by hire-purchase companies. Why should these organizations not be required to devote a certain percentage of their funds to the public sector of the economy to provide such essentials as power, fuel and transport? They finance the sale of radio and television sets which require electricity, and motor cars which require roads. I believe that they should be compelled to devote a certain percentage of their funds towards the cost of providing the services which allow the articles which they finance to function.

The Government has expressed doubts about loan raisings.


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


– If I were asked to select one word to describe this Budget I would select the word “ adroit “. The Budget has been framed under pressure from rising prices and in the face of a deficit in our balance of payments, which may be rather worse than is generally realized. I believe that the Government was a little precipitate in removing import restrictions without at the same time imposing other controls. I say that, believing sincerely that the nature of import restrictions, and the way in which they were framed, were wrong. It is a good thing that they have been removed, but I feel that we may need some other and better control in the present situation.

This is an adroit Budget. It meets our short-term problems very well, but it has concentrated, in the main, only on the short-term problems. However, I emphasize that it makes one valuable long-term contribution. I do not think that honorable members and the people generally have paid sufficient attention to the Government’s proposal to alleviate the means test. This is one of the best proposals which this Government has made in its eleven years of office. lt is extremely good, not only from the point of view of giving equity to the pensioners, but also, as I shall endeavour to show, in the long-term economic sense. One only regrets that it is so long overdue. Those of us on the back benches who have been pressing for this for the last ten years are glad that it has at last come about, but we regret that there has been so much delay in alleviating the means test because, if it had been done earlier, I believe that our economic situation would be healthier than it is.

The Government has also forecast one valuable long-term piece of legislation which affects the Budget and the price structure. I refer to the proposed measures against restrictive trade practices. This also is something which we welcome.

Having said that the Budget adroitly meets our short-term problems, and that it incorporates one good long-term suggestion and forecasts another, I still feel that it does not get down to the real root of our economic problems. The monetary measures which it proposes - the restriction of credit and the like - are nothing more than first aid. First aid is valuable in an emergency. Do not let us discount it or say that it is useless or worthless, but it is not the complete remedy. Beyond first aid you need a long-term plan to deal with the real disease. The Government’s financial policy, looked at over the perspective of eleven years, lacks this long-range planning, and I believe that some of our present troubles are due to this deficiency.

The monetary measures which will be applied by the Government will be applied in circumstances which have limitations due to the Government’s other policies - policies which I hope and believe will not be abandoned. For example, there is the objective of full employment, a policy to which I subscribe and to which the Government has subscribed. After all, during its term of office the Government has held employment in Australia at a higher level than did any other government in our history. But that policy limits the effectiveness of the monetary weapon. I say that believing, first, that the policy of full employment should take precedence, and secondly, that the Government is right, and will continue to be right, in espousing and so successfully applying the policy of full employment. But, as I have said, this policy does impose a limitation on the effectiveness of the classical monetary measures.

Then there is the question of our development. The Government is set - and set rightly - on a continuous policy of development. As the honorable member for Isaacs (Mr. Haworth) pointed out only a short time ago, perhaps we delude ourselves a little into thinking that the present pace of Australia’s development is phenomenal. It is good, but it is not fast by world standards. I do not believe that we could envisage a policy which would retard our present pace of development and put us behind other countries in the race for increased production and higher living standards. So here again is a limitation on the effectiveness of our credit policy - a limitation which we accept gladly but which we have to recognize. Indeed, one feels that the Government, during its term of office, has leaned too heavily on these short-term measures. They are good; they are first aid, but they are not more than first aid and they should not be allowed to defer the application of the real remedies.

I want to say something, first, in regard to the diagnosis of the root cause of our troubles, and secondly, something constructive on what can be done in relation to them. I know that honorable members will forgive me if I do this in summary and will realize that what I am setting out in summary are merely the barest bones of what has to be said on these matters at length at some time. To put the matter very succinctly, the root of our present troubles is the choice which Australian income holders make between what they save and what they consume. The income holders in Australia have a choice. What they save they invest; the balance is what they consume. Therefore, if savings go up consumption goes down, and vice versa. For whatever reason, there is a chronic shortage of savings in the Australian community. This is the root cause of our inflation and why everything else goes wrong. We have full employment; we have development, but we have inflation too. The reason is that the savings which the community elects to make are not sufficient to cover the capital goods, the factories, the houses, the roads and everything else which are needed to produce the consumption schedule which the community demands; that is the schedule of goods which the community wants to buy with the part of its income which it has not saved. So, the imbalance comes from both sides to the savings-consumption equation. If savings are not sufficient to cover the cost of capital goods, including houses, which are necessary to satisfy the consumption schedule - which is the balance of income - then you must have inflation and price rises. In a way, the short-term measures that you take will simply defer the crisis.

You may, by adroit monetary means, be able to avert trouble now, but if you do it will recur in a year or two with accumulated force because of the amelioration you have given yourself in the present. These first-aid measures have a habit of bouncing back, and we have to think of some long-term plan to take their place.

The savings deficit is a reality. You need not argue about whether Australians are saving as much as other people; the point is that it is demonstrable, on the figures, that Australians are not saving the amount necessary to satisfy the capital requirements essential for their own consumption schedule. Some people may say this is justified because we are developing at an inordinate rate but, as the honorable member for Isaacs (Mr. Haworth) has said, that is not true. We are developing, but not at a rate faster than that of comparable nations in other parts of the world.

You can make good your savings deficiency by excessive imports which run down your balance of payments and your foreign reserves. Then you can make good the deficit, as we have made it good, by capital imports on a large scale, by trying to attract overseas investment. This does indeed put off the evil day, but the capital investment you attract still has to be either serviced or repaid. So, as I said a moment ago, short-term measures may ease the present difficulty at the cost of aggravating the difficulties of future years. Unfortunately, this is what we have been doing and I, for one, feel a little worried at the fact that, in a way, we have become drug addicts for foreign investment. We were pleased to have this injection of foreign capital because it offered an easy way out of our difficulties, and now we have reached the stage where we cannot do without it.

When you get this condition of inflation going on because of savings deficiency, then you get price rises which impair the competitive position of the export industries - they have to sell on a very hard market abroad - and which impair the competitive position of industries producing for home consumption because they have to raise their prices and get extra tariff protection in order to carry on and maintain full employment. Then you get further pressures. One phase accentuates another and the ordinary feedback mechanism operates.

The Government, faced with this chronic savings deficiency, has resorted to one measure of force majeure to correct it. It has taxed in order to provide the funds for capital works for the States and many of the capital works in its own Budget. Every year many hundreds of millions of pounds are raised by taxes and put into capital works. This is because local savings are insufficient. In a way, the consumer choice is inadequate to meet the situation and the Government endeavours to correct that by the force majeure of putting on taxes and using the proceeds for capital works which normally should be financed out of voluntary savings which are not there. This high taxation itself has some curious inflationary side-effects. I shall not go into them, but honorable members know very well what some of them are.

If I may sum up the diagnosis as I have made it, most of the factors on which we are concentrating attention are the symptoms and not the causes of our economic ills. We are concentrating far too much on endeavouring to cover up the symptoms, to paint the spots and not concentrating enough upon the prime causes of the disease - the savings deficiency inherent in the income holder’s choice as between savings and consumption. Unless we can deal with this long-term problem, then, in spite of our adroit handling of all the short-term issues, we shall fail.

A substantial part of the reason behind this savings deficiency has been the massive anti-savings momentum generated over 50 years by the means test. It is something that we have spoken about in this chamber before; it did not come on suddenly, But these forces are massive, and they will not be reversed suddenly. I say, therefore, that the Government’s decision at last to do something constructive about the means test should be regarded as the first instalment, not merely of equity to pensioners and prospective pensioners but of a real policy of economic stability. I emphasize again that here, at long last, after too much delay, there is evidence of a bit of longrange economic thinking. If, ten years ago, this had been done and had been followed up by other methods of getting rid of the means test progressively, our economic position would now be much stronger because our savings rate would have been higher. You cannot get rid of the means test in one fell swoop for the obvious reason that when you make the change you pay, in the first year, all the costs of that change and do not start to collect any benefit by way of increased savings until years later. These things require methodical amendment. You do not reverse them suddenly; you have to attack them stage by stage. It is good that we have at last started to do this.

Action on the means test is not enough to change the situation. Something further is needed. I suggest that we need a refashioning of our taxation policy with a view to encouraging savings. As honorable members know, there is a taxation review committee now sitting, but it is excluded by its terms of reference from considering matters of major policy. This is not the kind of thing that is before the taxation review committee at the moment. I suggest that we should make major changes in the structure of our taxation with a view to encouraging savings.

This does not mean higher aggregate taxation. Indeed, in the long run it means lower aggregate taxation because, by increasing savings, savings money will be substituted for the hundreds of millions of pounds that we now raise by way of taxes every year and put into capital works. So I am not suggesting an increase of taxation. I am suggesting something which, in the long run, will lead to a decrease in aggregate taxation.

There are many methods which could be used to do this. I suggest one concrete method, not necessarily the best, but one which can be used unless somebody can think of something better. My suggestion is that we do several things simultaneously. In isolation, of course, they do not make sense. Let us put them together and see if we can make a pattern out of them. First, I suggest that there should be a nominal increase in basic income tax rates, especially in the lower ranges of income. Secondly, I recommend that there should be heavy increases in the deductions available to taxpayers for dependants. Furthermore, I suggest that the definition of “ dependant “ should be widened so that those taxpayers who have family responsibilities, whether they support a wife and children, a mother or father, or an invalid, will not be penalized, because they will be able to benefit from much heavier taxation deductions.

Thirdly, I suggest that a new deduction should be allowable to taxpayers who are over 21, or who are married, and that a further additional deduction - perhaps not of the same amount - be allowable to taxpayers who have attained the age of 65 years. The point of this proposal is to enable the heavy taxation to be put on the consumer range on which it should be put - the teenager. This, of course, is only part of the pattern that I am putting forward.

Fourthly, I think that there should be a provision that the taxpayer, whoever he may be, could deposit, say, up to £250 in any year of income in special bonds, such deposit to be a deduction from his assessable income in the year of deposit and an accretion to his assessable income at the time of withdrawal which, of course, the taxpayer would decide at his own option. Furthermore, I suggest that we should allow a deduction of portion of this accretion when the taxpayer marries or at the birth of a child, free of any accretion to taxable income. I am not suggesting that we should do anything to stop the teen-ager from saving. This capital amount to which I have referred would be available to whoever accumulated it at the time at which they really needed it. Others would be penalized if they did not save, but if they saved they would pay no more tax than they pay at the moment. I would suggest combining this policy with an increase in family endowment, because I think that we have to find some way of doing justice to those with family responsibilities.

It will be seen that this proposal is related to the wages problem. Wages are by far the greatest component in the situation, but I think it would be inconceivable to reduce the. wage of the family man. Indeed, I think it is desirable, as things stand, that it should be increased. The Opposition has fallen down in advocating an increase because it has failed to see that if you increase wages and do not do anything else you add to the inflationary situation and force prices further up. I am not in any way advocating keeping down the wage of the family man. Indeed, I would be an advocate of some increase at the present moment. The trouble, of course, is that wages are determined on the basis of a man, his wife and two children. This may not be formally so, but in substance it is so. So, inflationary consumption expenditure is coming from the wages paid for non-existent wives and children.

We cannot provide for smaller payments to be made to single persons than to married persons for the obvious reason that this would prejudice the married person in his employment. So the only appropriate means of redressing the present position is taxation. At the present moment, the single man without dependants is drawing an unfair proportion of the wages fund compared to the married man with a family or the single man who has dependants - I have emphasized that I would enlarge the definition of “ dependant “. The proposal that I make would not penalize persons if they saved. It would encourage savings in the section of the community that can afford to save. The high wages of teen-agers are responsible for much of the great inflationary consumption expenditure in the Australian economy.

I am not suggesting for a moment that a teen-ager should not have the opportunity to save without taxation penalty. Indeed, I would encourage it. I do not suggest any additional taxation for the teen-ager who saves. If he wants to save for marriage or to buy a house, let him do so. What I have suggested does not in any way interfere with such an objective nor does it penalize him. Nor do I suggest that the teen-ager or any one else who is supporting a dependant, whether wife, child, mother or invalid brother, should be in any way penalized. I do not suggest that he should pay any additional tax. What I suggest is that we should put the burden on those who can bear it and who are unwilling to provide the savings for the consumption that they will want later on.

Here is the inflationary factor. The teenager, when he marries, wants a house. Somebody has to find some thousands of pounds for it. He does not do that himself at the present moment. Let us give him a chance to do it. By so doing he will not incur any additional taxation. These may seem far-reaching measures, but they are the kind of measures that we have to envisage if we are to start long-term thinking and if we are to get away from the policy of short-term expediency which, I fear, has characterized this Government’s financial policy for so many years. I do not say that this is the only way to do it. Some honorable member may know of a better way to do it. But here, at least, is one way to do it and something, at any rate, should be done.

Of course, it would be naive to think that this situation can be cured instantaneously or by one measure. I am not simple enough to think that we can do that. I suggest that here is a first approach. Beyond that, there are other things that we have to do. We need a positive policy for raising productivity. I know that we have talked a lot about this, but we do not do very much on cither side of the chamber or on either side of employee-employer complex. We cannot afford, in Australia, to have as much expensive plant as we have lying around idle for all but 30 or 40 hours a week. Better organization could give us more productivity and so help us to raise living standards without inflation.

Very often I think that, here, the crux of the matter lies not on the employee but on the employer. I know that it is not always easy to deal with the technicalities of awards and things of that character. I know that it is more difficult if there are in the industry professional agitators whose real object in life is to cut down production and depress Australian living standards and productivity so that Russia can catch up with us and, later on, get ahead. I know that this is going on in industry. But still I believe that the employer could face this problem in a more constructive way. On the other side, the trade unions might think of ways of eliminating what is known as “ feather bedding “ - the idiotic requirement that two men should do a job that one can do.

In the long run, every time something is done which makes productivity less for a given labour input, the potential living standards of the whole of the Australian people are lowered, and the total of the Australian output on which our development as a nation depends is also lowered. I do not say this is something which the unions should do alone or which the employers should do alone, but it is something in which both of them have a real vested interest, as Australians. They should come together and get rid of a very real impediment, on both sides, which prevents the rise of Australian productivity at a faster rate. I suggest that we have to think more constructively in terms of real margins throughout our industries. I know that the political use of the word “ margins “ has discredited it but surely we on this side of the House should be actively encouraging the maintenance of a proper margins pattern throughout industry.


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


.- I feel a little awkward in replying to any of the criticisms or comments made by the honorable member for Mackellar (Mr. Wentworth) on the Budget because, while listening to him, I agreed with almost everything he said. However, I suggest to him that, while he is thinking about social services, instead of hammering continually for a complete relaxation of the means test, he should do some real hammering on behalf of those people who are on base rate pensions, so that those who have not a reasonable income will at least have pensions which will enable them to live decently. I believe that if the honorable member adopted that stand, he would be seeking to help a lot more people to a greater degree than he is doing with his advocacy of the complete relaxation of the means test. When I make that statement I am not disagreeing with the case for the relaxation of the means test. T consider that first things come first and I feel that an increase in the base rate - not only of age and invalid pensions but also of other social services - would be really doing something for a lot more people.

In the Budget we have yet another example of this Government’s boom and bust economy. The Government lets things run until they almost burst. And during the Government’s ten years in office, things have burst on a couple of occasions! We heard a great blare of trumpets earlier this year when the Prime Minister (Mr. Menzies) and the Treasurer (Mr. Harold Holt) said that, at that stage, we were on the verge of a dangerous period of inflation.

There was similar talk from those gentlemen back in 1948 and 1949; and yet, after they have been in office for ten years, we still hear talk from them about dangerous inflation. After ten years in office the Government has not been able to keep the economy of this nation on an even keel and avoid the boom and bust economy.

When talking about inflation this year the Government has its usual solution - a balanced Budget, unlimited imports and pegged wages. Nothing is heard about pegged profits. Ministers always concentrate on the necessity for pegged wages. In my opinion, the dangers of inflation were used most effectively by the present Government earlier this year when it talked the Conciliation and Arbitration Commission into rejecting the claim by the Australian Council of Trade Unions for a review of the basic wage and an increase in income for the millions of workers in this country. How is the Budget to be balanced? That is to be achieved, not by balancing the Government’s income and expenditure this year, but by borrowings. Facts and figures in this Budget make it quite clear how the Budget is to be balanced, and, indeed, a surplus of £15,000,000 obtained. The result it to be achieved by the borrowing of £150,000,000. That is the only way in which the Government could balance the Budget.

The part of the Government policy which needs closest examination is that relating to import restrictions. In closely examining the imports and exports of last year, I refer to the White Paper which was prepared and distributed by the Treasurer. At page 28 I find that in our last trading year we were able to get within £4,000,000 of a balance. I feel that the method of arriving at that position is worthy of some examination. Our exports and imports were within £10,000,000 of each other, and we finished on the wrong side of the ledger by an amount of some £10,000,000. The invisibles came to a total of £233,000,000. so the total balance on the wrong side of the ledger was £243,000,000. The only way that that was offset was by a number of overseas loans, by undistributed income and also by the profits that were made by the investments of overseas moneys in this country.

How long can our economy continue to balance on the razor’s edge? That term has been used by the Deputy Prime Minister (Mr. McEwen) and the Treasurer on a number of occasions. The point is that we have built up overseas credits by a fortunate succession of good seasons. We have been able to build up a good overseas balance also because we have been able to borrow on the world market money - some day it will have to be paid back - and also because of overseas investments in this country. I like to see this country with a large and healthy overseas balance, but what is to happen to us when he have a couple of bad seasons? According to the cycle of time they are sure to occur sooner or later. What will happen to us when we have those bad seasons, and what will happen to the economy of this country when the investors really start to take the profits out of Australia?

Let us take, for example, our old friend General Motors-Holden’s Limited. Earlier this year that company went on to the Australian money market to raise an additional £2,000,000. I notice it has decided to proceed with another £15,000,000 worth of development. Where will the company get that money? It is pretty obvious that it proposes to raise the money on the Australian loan market. But what will happen to the profits from that increased investment in Australia, which is not an investment of American money but an investment purely and simply of Australian money in Australia? The result of the increased profits derived from the use of that money will be that Australia will have additional commitments overseas. I feel that a paragraph written by the financial editor of the “ Sydney Morning Herald “ in that newspaper when this company made application earlier in the year to raise £2,000,000 on the Australian money market is worthy of comment. The item to which I refer said -

General Motors Acceptance is treading hopefully in the steps of G.M.-H. It is keeping up the grand tradition that General Motors of U.S.A. does not invest in Australia. If the capital needs cannot be met out of huge retained profits, as in the one case, then borrow from the natives. But don’t send a dollar out from Detroit.

That, I feel, concerns this country. As was suggested by the honorable member for Mackellar, we are slowly and surely building up to the day, a few years hence, when these investments in Australia, which at the moment are assisting us to balance our overseas accounts, will start to flow the other way - as will also happen in regard to our overseas loans, when the principal has to be repaid, and this country is really going to find1 itself in a position similar to that in which the people of Cuba have found themselves. The people of Cuba have got sick and tired of seeing their money exported to the United States. I feel that in the years to come the people of Australia are likewise going to get sick and tired of seeing their money exported to the United States. The same problem is occurring in Canada to-day, and also in a number of areas in Asia. Sooner or later the people in those countries, whether they be black, brown, white or brindle, finally rebel against world capitalism. They rebel against working to keep the capitalist system going, whether it be the capitalist system in the United1 States, the United Kingdom or any other country which has money invested abroad.

I think that the members on the other side who are continually raising in this Parliament the issue of communism bear the responsibility - which they must accept, because they support the present policy of the Government and the Treasurer - of having provided the fertile soil for communism to breed in this country at some future date when the state of affairs I have mentioned arrives. Therefore, I give them due and timely warning to take note of what is going on around them, especially in regard to this investment in Australia of overseas capital, particularly that section of it which is invested, not in new machinery and new ideas brought to the country, but in taking over existing industries - because that is what is happening.

All that the overseas capitalists are doing here is moving in and taking over going concerns. I feel that counteracting this is one immediate step that the Government should take. If the Government wants overseas capital brought into Australia, then Australia should do several things in regard to it. First, we should see that the money brought in will be used for the establishment of new industries and not for taking over existing industries. If we pursue that policy we will really be doing something to ensure the future of this nation, and the honorable member for Mackellar will not have to worry about the teenage or bachelor tax that he talked about this afternoon.

On the subject of imports, if this Government is greatly concerned with building up our export trade it is appropriate to raise at this stage of the debate an important matter appertaining to my electorate, and to the port of Newcastle in particular. I have been in correspondence with the Minister for National Development (Senator Spooner) on this matter, I might say without much avail. I have not had much success with him, because when one talks to that Minister one is certainly talking to somebody who could be classified1 quite easily as being in the frigid zone. I am referring to the export of coal to Japan. Over the last two or three years Australia has been doing all it can to develop coal markets in Japan and other countries, so as to provide employment for the men at present displaced from the coal industry as the result of mechanization.

Honorable members know as well as I do that the number of men displaced from the industry amounts to approximately one-third of the total work force previously engaged in the industry. Their displacement has had a great effect on the employment position in the steel, textile and other industries in the Newcastle and Hunter Valley areas. What affects the mining industry also affects the remainder of the people in that district. I give this Government the credit for being very active, in conjunction with the New South Wales Minister for Mines, in trying over recent years to develop an export coal trade. Apparently negotiations reached the stage where Japan last year bought from Australia 1,000,000 tons of coal at a cost of approximately £4,000,000. It has been announced that this year Japan will purchase from us approximately 500,000 tons between now and the end of the year. The point is, that if we are to retain the export market for coal - and it is a highly competitive market, as has been said again and again by Mr. Sam Cochran, the president of the Joint Coal Board, by the New South Wales Minister for Mines, by everybody else in the New South Wales Parliament and by Sir Edward Warren - we have to step up our organization. We have to have improved methods of production. These improved methods are possible as the result of machinery recently installed, but the industry runs into bottleneck after bottleneck when it comes to shipping the coal overseas. The Americans, as the result of the use of bulk-carrying ships of from 25,000 tons to 40,000 tons capacity, have been able to reduce the cost of carrying coal by from one dollar to one and a half dollars a ton. If we are to gain a foothold in the markets now supplied by the United States we must reduce our cartage costs to Japan or any other country by an equivalent amount. However, at the moment, although Port Kembla is fast developing to the stage where it will be able to cater for ships of that tonnage, Newcastle, because of the existence of a harbour bar, is not able to handle ships of over 17,000 tons or 18,000 tons. To overcome this disadvantage would be costly. It would require the expenditure of several million pounds. At the moment the port is large enough to handle the normal trade which uses it - that is, in the export trade in wheat, wool and so on - because the ships used are of a size which can use the port. Removal of the harbour bar would benefit the export of those commodities, but the really important benefit would be in relation to the export of coal.

Early this year, and again in June, I wrote to the Minister for National Development and asked him to do something about this problem. Again and again in this chamber I have asked the Commonwealth to do something about it. Every time, the Minister rejects my request and is quite emphatic that this Government is not prepared to make any money available for that purpose. If the members of the Government are so eager to build up a coal export trade for this country, which will return £4,000,000 or £5,000,000 a year, there is one way in which they can do it. That is to assist New South Wales to export coal to Japan by helping with the necessary work on the harbour bar at Newcastle. Another way is to do something about developing Port Kembla as a coal port. The benefits from taking these actions would flow back to the Australian people as a whole, because coal sales overseas would increase our trade earnings. This would be breaking new ground so far as the Government is concerned, because it has been giving its help in other directions.

For example, at present the Government is subsidizing the transport of coal from Leigh Creek to Adelaide in South Australia, at a cost of about £600,000 annually. It does so by allowing that coal to be carried by the Commonwealth railways at favorable rates. By so doing it is helping to defeat the sale of coal to South Australia from the Newcastle or south coast fields. In comparison with Maitland coal, or any of the coal produced in the Newcastle area Leigh Creek coal is just black mud. Yet the Government is helping the production of this so-called coal to compete with the production of coal on the northern coal-fields.

All we are asking the Government to do now is to make the necessary money available to enable Newcastle coal to be exported at prices competitive with overseas coal. The Government made a direct contribution to the development of the harbour at Gladstone in Queensland. Through the Joint Coal Board it has also made a direct contribution to the provision of loading plant at White Bay in Sydney. It is not much of a plant, but at least the Government made the money available for that work to be carried out. Besides that, this Government, again through the Joint Coal Board, has made available more than £20,000,000 to private coal owners in this country to enable them to bring their industry up to date. Yet it will not make money available to the New South Wales Government to bring a harbour up to date.

Sitting suspended from 6 to 8 p.m.


– -Before the suspension of the sitting, I was dealing with the necessity for this Government to make funds available for the development of the port of Newcastle. I point out that the Joint Coal Board has sufficient power to make funds available for this purpose. This clearly emerges from a reading of the Coal Industry Act 1946-1956, section 14(1.) of which states -

The powers and functions of the Board are to include the taking of such action as, in the opinion of the Board, is necessary or desirable . . .

Sub-section (2.) states -

In particular, without limiting the generality of the foregoing, the Board is to have power to make provision for or with respect to -

the effective and economical distribution of coal, including its purchase, sale, marketing, acquisition, disposal, supply, storage, reservation, pooling, transport, carriage, conveyance, delivery, handling, loading, discharge and reception;

The Joint Coal Board clearly has power under the Coal Industry Act to provide the funds necessary to overcome the bottleneck at Newcastle, so that new methods of transporting coal may be used. If we are to compete with the United States of America, we must use vessels of 25,000, 30,000 or 40,000 tons instead of the vessels we at present use of 10,000 or 12,000 tons.

The remaining point that I should like to deal with in the time at my disposal is the Government’s attitude towards wages generally and the basic wage in particular. On previous occasions, I have condemned the action of the Government in intervening in the case before the Commonwealth Conciliation and Arbitration Commission and opposing the application for an adjustment of the basic wage. I shall give some figures to show how much the Government’s action is costing the workers. The Government brought pressure to bear on the commission to force it not to increase the basic wage. The workers in New South Wales are much better off than are workers in other States because the New South Wales Government permits the basic wage to be adjusted quarterly in line with variations in the cost of living. The decision to freeze the basic wage is costing workers under State awards in Victoria 27s. a week. That is the additional amount they would be receiving if cost of living adjustments were made. Workers in South Australia are losing 18s. a week; in Western Australia, 8s. 9d. a week; and in Tasmania, 19s. a week.

We continually hear the cry from the Government that wages are causing the inflationary spiral; but not once have we heard any honorable member on the Government side give the real reason for the inflationary spiral. The real reason can be found in the financial pages of the “ Sydney Morning Herald “ and honorable members opposite would do well to read these pages while they sit in an aeroplane on Friday morning on their way home. I shall read some of the headlines that appeared in the “ Sydney Morning Herald “ on Friday, 26th August.

There we see advertisements by Lend Lease Corporation Limited offering 8 per cent, and by Cambridge Credit Corporation Limited offering 9 per cent, on money invested with them. Other companies offer 8 per cent., 9 per cent, and 10 per cent, and some go even as high as 15 per cent. I cannot believe that that does not create inflation. The money invested with these companies is lent by them to others at far greater rates of interest.

In the financial section we find such headlines as “ Australian Controls Profit Recovery “; “ Swan Cement Bonus Issue “; “Marrickville Holdings Growth Hint” - the company had just completed a very satisfactory financial year; and “ James Stedman First Group Profit” - this is the first result of the new holding company and it showed a profit of 18.3 per cent, on ordinary capital. Other headlines are “ R. E. Cunningham Dividend Up. Profit Trebled”; “McPherson’s Issue. Profit Jumps “; “ Humes Group Profit Up Again “; “ Winchcombe Dividend Steady “; “Chapman’s Profit Up”; “Fire Fighting Profit. Further Big Rise “; “ Molloy Holdings Profit Rises 19 p.c”; and “J. Mcllwraith Profit Jumps 36.3 p.c”.

Mr Chaney:

– What does it say about turnover?


– These are the increases of profit; never mind about the turnover. All the headlines I have just read are on one page, and there are a number of others. We find that the profit of Clark Rubber Stores Limited showed an increase of 26 per cent, and that Control Systems (Australasia) Holdings Limited had an increased profit of 10 per cent. Those are typical of the figures to be found on that page. On page 12 of the same issue, we find headings such as “ Farmers Rise of 15s. in Five Days; “; “ Preston Motors Profit Up “; “ Cox Finance Earns 1 6 p.c”; and “ Coal Companies raise Dividends “. But at the bottom of that page we find a really interesting item. It reads -


Lemons, grapefruit and large oranges sold slowly at the Municipal Markets yesterday.

Demand for peas and beans was moderate to poor, and stocks had not cleared at a late hour.

Is it any wonder that we find large profits being declared! Now let us look at that grand1 old octopus in Newcastle, the Broken Hill Proprietary Company Limited. For the financial year ended 31st May, this company declared a profit of £13,716,000, which was an increase of £3,533,000 or 34.7 per cent.

These figures tell the real story about inflation. These are the companies that the Government is concerned about when it frames its financial policy and decides to intervene before the Arbitration Commission - these fellows that are dead from the ears down. The commission was not prepared to grant to the workers the increase to which they were justly entitled because of the increased productivity of the country. The Government speaks constantly of productivity and claims credit for increased productivity, new methods of production, automation and so on. But when the workers want their share of this prosperity, the Government stands over the judges and commissioners of the Arbitration Commission and prevents them from granting any increase. The Broken Hill Proprietary Company Limited could have granted its 37,000 employees an increase of £1 a week and still have shown a profit exceeding that for the previous year. It did not do so, and the Government stood by it and assisted it by intervening before the Arbitration Commission.

Government supporters continually ask Opposition members what they would do about present conditions if they were in office. We believe that until this Government, or any government, is prepared to tax capital gains and really tax the profits of these companies, the companies will continue to be in the happy position that they are in to-day. They can declare their dividends and increase their capital gains with complete immunity, because this Government will do no more than talk about a capital gains tax. The Government says that it has no constitutional power to impose such a tax. But recently, it received the report of the Constitutional Review Committee. The Government has been told time and time again that it would receive the support of the Opposition if it were to hold a referendum seeking power to impose a capital gains tax.

Such a tax would not be something new. This Government’s counterpart in the

United States of America imposes a capital gains tax. It is not afraid to use that kind of tax against these companies which make exorbitant capital gains. We ask the Australian Government to adopt a similar policy and practice in this country in order that the people of Australia may get their hands on the money that is tied up in some of the unnecessary profits that are being made by industrialists and commercial enterprises as a whole. We feel that this is the only sensible and logical thing to do.

I should like to give the committee a little information about some of the companies that I know are making enormous capital gains. Between February, 1952, and 1959, the H. G. Palmer company made capital gains totalling 1,181 per cent. Ampol Petroleum Limited has made capital gains of 720 per cent. Then we come to Mount Isa Mines Limited. Government supporters are always boasting about the fact that over 51 per cent, of the interest in that company is under American ownership. Mount Isa Mines Limited has made capital gains of 701 per cent.


Order! The honorable member’s time has expired.


.- Mr. Temporary Chairman, the honorable member for Newcastle (Mr. Jones) established - whether or not he wished to do so - that this country is in a state of great prosperity, as has been said for some time by honorable members on the Government side of the chamber. I can only think that the honorable member is envious of the companies to which he has referred and that Labour would, if it could, take the short-cut to control of some of these profits which the honorable member has mentioned, and that it would try something that it tried once before - nationalization. But this Government is determined at all costs to stop any such attack on the liberty of the people.

We in this country have a problem which is said to be associated with expansion, and Labour supporters suggest that the way to deal with it is to slow down the rate of expansion. Those who sit on the Opposition side of the chamber, and who speak on this subject on behalf of the socialists, remind me rather of a leader of the United Kingdom Labour Party who, after that party had lost the general election last year, remarked that the Labour Party in the United Kingdom represented a section of the people that no longer existed. That is very much the case with the Australian Labour Party.

I hope to show, as I go along, that there is a section of the people which needs strong representation in this Parliament. That section has never had proper representation from the Labour Party. The people who comprise that section have been described as peasants, hill-billies and the like. They are people whom I am proud to represent in this place. For years and years, they have been termed the backbone of Australia, and they still carry the great burden of providing overseas credits for this country. The Australian Country Party is proud of its representation of people who live in country districts. We who belong to that party do not represent only primary producers. We represent, also, businessmen in country districts and the true men of Labour - the workers. They are associated with us in our work on our own farms and in daily activities in the towns, and our party receives a lot of support from them because they know that we give them a fair go. They know that their interests and ours are closely linked. They know that the country towns are dependent on the broad acres about them for their very existence. The people in the cities are becoming aware of the truth of what we have been saying for many years. So I make no apology for placing before honorable members conditions thai exist in the country to-day.

We are concerned about an apparent imbalance at present between the various sections of the people in Australia. We think that there is a very great measure of co-operation between both the primary and the secondary industries. If there is not. there should be. Both must realize that the Australian people are the best consumers of their products - that the Australian people provide the best market for both the primary and secondary products of this country.

Mr Curtin:

– The trade unionists provide the best market.


– They are great consumers of our goods, and the trade unions should realize how foolish they would be to take any action that would cause farmers to lose faith in their industry and think of going out of it. The trade unions must realize, also, that the farmers are very good buyers of the products of the manufacturing industries in which so many of our trade unionists are employed. I suggested a moment ago that there is an imbalance in the community which may have very disastrous effects on Australia’s economy unless it is checked. It may cause very grave harm not only to the people that we who belong to the Australian Country Party claim to represent but also to Australians generally in the cities ‘and country towns and on the farms.

We realize that, in the presentation of this Budget, the Government has been conscious of an inflationary trend that has steadily persisted for some time. We realize that before a government presents its financial statement to the Parliament and the people, it seeks all the information it can get on the problems of finance and of the economy generally. The Treasurer (Mr. Harold Holt), in the preamble to the financial statement which he presented in Budget speech, said -

More than ever these days, the Commonwealth Budget has to be regarded as a means to guide the broad trend of the economy in the direction of certain well-established goals.

He then referred to stability, continuous growth of population, rising standards of living and so on, and said that the Government has a responsibility to safeguard the share in the gains of progress to which every one is entitled.

I now put it to the committee very shortly that some sections of the community - they are the ones for which I speak this evening - are not sharing in the gains of progress in which, as the Treasurer has suggested every one is entitled to share. Certain measures are being taken by the Government. Some will be taken as a result of this Budget and some were taken before it was presented. As the Treasurer has said -

The Budget is not the only instrument of policy - monetary policy and trade policy have highly important roles to play - and there must be consistency between all three.

I shall deal first with the problems with which the primary producers are confronted. Again, I say that these are not the problems only of the primary producers.

The primary industries produce the goods which earn some 80 per cent, of our export credits, and I point out that the manufacturing industries require the funds which are earned by these exports in order to pay for about 80 per cent, of their imports of raw materials for manufacturing processes. This shows how the two sections of industry dovetail together. There is a close interdependence. There was a time when Australia did not have a great deal of secondary industry, but depended almost entirely on primary industry for export earnings. To-day, we hope that some of the secondary industries will take a part of the load off the primary industries and will help to earn export credits. But the primary industries must be given the heart to carry on their job. We must not allow them to fall by the wayside. If they do, the whole community will suffer.

One of the big problems of the primary industries which we should investigate is the problem of the failure of income to improve with greater production. Primary production in this country has increased tremendously in the post-war years, and particularly during this Government’s term of office. Unfortunately, this has not been reflected in financial returns to the producers. This discrepancy is often overlooked. Another problem is that costs are rapidly outstripping returns. When I speak of costs, I do not mean only production costs. I mean also the cost of living, which affects every one in his daily life. Increases in costs have a double impact on the primary producer. He is hit by the increases that he has to meet in the course of his business, and which he cannot pass on because the greater part of his market is overseas. He also feels the daytoday effects of increases in living costs.

Then there is an instability in our markets which is not something that we in Australia can entirely correct. We have in our own hands the right to regulate our production to some extent, but we have no control over outside markets. We have no control over the great improvements in productivity that have been achieved in other countries. The advances that we are making here by more scientific use of our land are also being made in other countries. We face also the great problem, particularly in the wheat industry, of price support in countries which have accumulated tremendous stocks, which are a constant embarrassment to us. Not only do we experience instability in some of our markets; there is also a great degree of instability in our sales, despite the fact that we have stabilization organizations in operation.

Dealing with the matter of production and problems associated with it, I would like to read a brief section of an article which was published in a Sydney metropolitan newspaper in February of this year. It is quite a lengthy article, dealing very carefully and fully with problems of inflation. The author started off by asking, “ Who’s worried about inflation anyway? “ and he pointed out that some people say, “ I do not mind if my wages go up a bit every year. What if the cost of living does rise? These things balance out.” He then went on to point out that two sections of the people are definitely hit and cannot escape. There are others also, but the two sections are the people on fixed incomes and the people who sell in markets overseas. Dealing with the latter he said -

Since the end of 1952 retail prices in Australia have been going up year in and year out at about 2-3 per cent, per annum. Should we care? Farmers care. While retail prices rose by some 30 per cent, between 1951-52 and 1958-59, export prices actually fell by nearly 30 per cent.

He continued by saying that farmers do not get cost of living adjustments. I trust that Labour supporters who are trying to interject will take note of the fact that farmers do not get cost of living adjustments.

Mr Holten:

– They have no 40-hour week, either.


– Nor do they have a 40- hour week, as my colleague from Indi reminds me. The author of the article went on to say -

Only the expansion of productivity on Australian farms in the last decade has saved our rural producers, as a group, from very damaging inroads into their living standards.

Let me point out here that our productivity has increased and we have been able to stave off disaster which would otherwise have overtaken us a long time ago largely as a result of the efforts of this Government and the members of it. It has been largely as a result of the tremendous amount of work that has been put into the establishment and administration of the Department of Trade by our leader, the right honorable member for Murray (Mr. McEwen). It has also been largely as a result of the acceptance by primary producers of the fact that they were in an unsatisfactory position, and their efforts to improve that position.

I direct the attention of Opposition members to the fact that we have been assisted very largely in our selling by such things as the Japanese Trade Agreement, which was decried by the Opposition.

Mr Peters:

– Hear, head


– It is evidently still decried by the honorable member for Scullin. That agreement was one of the factors responsible for our sales of wool continuing to represent such a large proportion, about 40 per cent., of our export income. That agreement also enabled us to sell wheat and barley to a country which had very seldom bought wheat and barley from us before. Japan had previously bought practically no f.a.q. wheat from us, but she is now taking a very large quantityof it.

This Government was instrumental in re-negotiating the International Wheat Agreement. It has made us a party to the International Sugar Agreement and the General Agreement on Tariffs and Trade. The Minister for Trade attended the British Trade and Economic Conference in Montreal, as a result of which we are assured of overseas sales of a tremendous amount of our products. The Government has managed to improve our sales of wheat to India and Ceylon, where wheat selling was becoming a problem of the first magnitude. It has been responsible for sales of our flour to Malaya and to West Germany. It has negotiated the meat agreement with the United Kingdom. All these actions on the part of the Government have helped to retain some sort of stabilized market for the primary producer, and some kind of reasonable price for his products.

The Government has negotiated dollar loans, which were howled down by the Opposition but which have been responsible for bringing to this country machinery to enable the farmer to keep pace with mechanization movements overseas, as he must do because he is competing in the same markets. The Government has also granted tax concessions to primary pro ducers, in the form of depreciation allowances, to enable them to effect improvements on their properties designed to increase production. They can now build on their properties homes for their employees of a standard which even the honorable member for Kingsford-Smith (Mr. Curtin) would agree should be provided. Unfortunately, however, I must say that there is one unsatisfactory aspect of this form of depreciation allowance. If a farmer is not making sufficient money to allow him to undertake this kind of capital improvement, he cannot get the benefit of the tax concession. Again, as my friend the honorable member for Mallee (Mr. Turnbull) reminded me earlier to-day, those who receive small incomes do not get the benefit of this depreciation allowance as the men with large incomes do. As a consequence, this concession is not proving as successful as it might be.

I deal next with the matter of farming efficiency. Is the primary producer efficient? If he is not efficient, of course, we should not waste time on him. The measure of his efficiency can be gauged from the fact that while wool production prewar was about 7.7 lb. per head, it is now 8.8 lb. per head. Average production of wheat in pre-war years was about 12 bushels an acre, and it is now in the neighbourhood of 17 bushels an acre. Similarly, sugar productivity has increased by about 12 per cent, over pre-war levels. It can be accepted that the volume of rural production has increased and that the farmer is efficient. In any case, no one in this chamber has suggested that he is not efficient. The volume of rural production is about 50 per cent, greater than it was pre-war, so it cannot be said that the farmer is not worthy of encouragement. He is definitely an efficient unit of the community and pulling his weight.

I come now to the question whether the primary producer is getting the benefits arising from this increased productivity to which he is justly entitled, and which he must be granted if he is to continue to carry the great load that he has borne for so many years. I have before me the White Paper on National Income and Expenditure for 1959-60, which was placed before the

Government by the Treasurer for the information of members of the Government, and which they consulted, no doubt, when considering the Budget Estimates. In the introduction to this paper we find the following remarks: -

The estimates for 1959-60 in particular provide some of the statistical information needed for an appraisal of the economic conditions in which the Budget for 1960-61 has been prepared.

On page 4 the paper says -

The main components of gross national product, with the exception df farm income, also increased rapidly in 1959-60.

It is little wonder that that exception was made, because no doubt you, Mr. Temporary Chairman, have seen a copy of this paper which contains a graph relating to wages and salaries, lt indicates that wages and salaries increased by 9 per cent, from 1958-59 to 1959-60 but that farm income showed such a small increase as to be almost unnoticed on the graph. That is the position which confronts the farmer.

The honorable member for Newcastle, who preceded me in this debate, stated that the Government, by its appearance before the wage-fixing tribunal, was trying to keep wages down. We do not advocate a reduction in wages. The farmer does” not ask and has never asked for that. All he asks is that he be placed in a position to share in our prosperity with the remainder of the community. When one realizes that farm incomes barely increased from 1958- 59 to J 959-60 while wages increased in that period by 9 per cent., the importance of the position becomes apparent.

The Thirty-eighth Report of the Commissioner of Taxation, dated 1st June, 1959, contains some very interesting figures. No doubt this report was available to the Government when it was preparing the Budget. Table 35 shows the number of persons in various occupations who were liable for tax. T shall quote only the broad figures but they will serve my purpose. In 1954-55 taxpayers engaged in primary production numbered 291,000. In 1955-56 the number was practically the same. In 1956-57 there were 295.000 taxpayers, while in 1957-58 the number fell to 287,000. These figures do not represent the number of persons engaged in primary production. They represent only those who earned a taxable income. That accounts for the fall in 1957-58. The actual income of those people in 1954-55 was £391,000,000. In 1955-56 it dropped to £379,000,000 but in 1956-57 it rose to £459,000,000. However, in 1957-58 it dropped again to £347,000,000. This illustrates the instability to which I referred previously. The taxable income of persons engaged in primary production fell by approximately £44,000,000 between 1954- 55 and 1957-58 - this at a time when the incomes of other sections of the community showed considerable increases. In 1954-55 approximately 3,600,000 taxpayers earned an income of £3,200,000,000. The total income rose to £3,400,000,000 in 1955-56; to £3,700,000,000 in 1956-57 and to £3,800,000,000 in 1957-58- a steady increase.

A similar state of affairs exists in relation to companies. In 1954-55 company income amounted to £617,000,000. In 1955- 56 it rose to £647,000,000; in 1956- 57 to £702.000,000 and in 1957-58 to £735,000,000.

These two sets of figures indicate that while the incomes of primary producers rose for a while and then fell in 1957-58, the incomes of individual taxpayers and companies have been rising constantly. The amount of tax paid followed the same pattern. Primary producers in 1954-55 paid £63,000,000. In 1955-56 the amount dropped to £56,000,000. In 1956-57 it took a leap to £80,000,000 - that was a good year - but in 1957-58 it fell again to £43,000,000.

The most worrying feature is that if you divide the total actual income of the primary producers by the number of individuals following that occupation, you will find that in 1954-55 their average income was £1,340 but in 1957-58 it was only £1,200. Can you expect any man to carry on with confidence an industry which reeks with variations in income such as I have mentioned; an industry which is a continual gamble against weather, pests, diseases and so on? Can you expect a man with a big capital investment to carry on, not only with a falling income but also with an income which does not allow him to acquire sufficient capital to improve his property and so get the benefit of depreciation allowances and so on?

I should like to refer now to costs. I do not propose to enter into the whole of this problem as it affects industry generally and primary industry in particular, but some examination must be made with a view to finding a solution. The primary producer cannot pass on the rising costs. We suggest, in the first place, that possibly our secondary industries are not as efficient as they could be. I do not blame either management or labour, but it is time that we considered whether the efficiency of our secondary industries is comparable with the efficiency of factories overseas. In America, everything is about three times as dear as it is in Australia. For instance, a haircut costs about 17s. 6d.; but the people receive wages which are about three times greater than the wages in Australia. If we, with our comparatively low wages, are pricing ourselves out of overseas markets, how does America compete on those markets? The answer is that America must be much more efficient than we are. We should examine the position in our secondary industries. They must continue to function because they are an integral part of our organization and our economy.

Let me deal now with tariffs. Is it not time that an investigation was made to ascertain whether industries which are to-day working behind a tariff are not unnecessarily getting the benefit of protection which was granted to them years ago? No doubt, those industries are indifferent about increasing their efficiency because they have the tariff protection. This is a problem for both management and labour. I do not lay the blame on either side, but without doubt the matter requires investigation.

According to the Treasurer, the banks are conscious of their traditional role as the major source of finance for rural industry. I think that the Treasurer replied in those terms to a question which was asked of him a short time ago by a Government supporter. Unfortunately, our experience is that if we go to a bank to borrow money we are referred from the main counter to the hirepurchase department. If a farmer asks for an overdraft to-day he is probably referred to a wool firm which obtains its money from a bank. The role of banks as the traditional source of finance for rural industries seems to have disappeared.

We believe that inflation will be checked by the steps which the Government proposes to take. Farmers, graziers and primary producers generally ask for stability in rural industry. They ask for a reduction in their costs and for assistance with their credit problems so that they may continue the expansion they have started. I am not suggesting, nor do I agree with any suggestion, that there should be a reduction of the expansion of this country. I have faith in the Government. I believe it has tremendous problems to face, and I believe that there is no simple solution to those problems. However, it is the solution of problems that make life worthwhile. I believe that the primary producer will stick it out if he has only an inkling of a promise cif those things which he feels are his just due. I feel competent to say for the people of the country districts that they appreciate the burdens they can carry, and the responsibilities they have to shoulder. They have been going through drought and fire with all their hazards, and still have the courage to carry on despite the disabilities from which they are suffering at the present time.


.- During this debate I have had the privilege of listening to a great number of speeches from both sides of the chamber. Considering them all from a non-party point of view, I should say that the contributions from the honorable member for Bradfield (Mr. Turner), the honorable member for New England (Mr. Drummond), the honorable member for Yarra (Mr. Cairns), the honorable member for Melbourne Ports (Mr. Crean), the Leader of the Opposition (Mr. Calwell), and the Deputy Leader of the Opposition (Mr. Whitlam), were all praiseworthy contributions to the subject of the Budget.

Mr Turnbull:

– What about the contribution by the honorable member for Kingsford. Smith?


– He will speak for himself. The honorable members to whom I have referred made excellent contributions to the debate. Irrespective of whether we agree with them in their entirety they were all worthy of nation-wide circulation to the people.

I have never posed as an economist but, as the Budget is, in effect, a resume of the state of the economy of the nation, I have endeavoured to the best of my ability to ascertain exactly Australia’s financial position among the nations of the world to-day. O’ne has only to note from the figures presented in the Budget Papers that our international trade balances have gone to the bad by over £1,000,000,000 in the last seven years to realize that although, on the surface we appear to be enjoying great prosperity, in reality problems of the greatest magnitude confront us as a people. These problems are . exacerbated by the fact that prices for our exported primary products continue to go down and down while the cost of producing those things which we export and upon which we depend to pay our international, debts continues to go up and up. These circumstances have continued under the present Government over a great number of years, and although I am not a pessimist I do think that it may well be that, within a measurable period, we could easily find ourselves in a very difficult plight indeed and be forced to make a very drastic readjustment of our internal economy.

Let us look at the facts. When it attained office, the present Government was conscious of the fact that there had been a slight degree of inflation between 1946 and 1949, during the Chifley Government’s regime, due entirely to the fact that supporters of the present Government had opposed the grant to the Commonwealth of the economic powers necessary to prevent inflation. From the moment that this Government took office every member of it from the Prime Minister (Mr. Menzies) down to the lowliest member of his Cabinet, and every private member, has been warning the Australian people of the dangers of inflation. But inflation has continued to grow insidiously from that day up to the present time and warnings are still being issued about the dangers of inflation, and the need for action to prevent the insidious growth of this dangerous movement in our economy. I agree that it is dangerous. Inflation is as dangerous as deflation and can be remedied only by the adoption of drastic measures. In almost every Speech delivered by his Excellency the GovernorGeneral, and in the Budget speeches delivered by the Treasurer, appeals are made to this section or that section of the community to be rational and reasonable, and to endeavour not to accelerate this very dangerous trend. Why, one might just as well appeal to the Devil to prevent sin! Appeals such as those contained in the speeches to which I have referred are absolutely futile. During the whole of the period in which this Government has controlled the economy of the country, whenever it has thought to apply some so-called remedy, it has made an attack upon the working classes and those in receipt of the lowest incomes in the community. For instance, this Government adopts such measures as the starvation of social services. Admittedly it proposes by this Budget to throw 5s. a week, or the price of two packets of cigarettes, to the pensioners and to increase company tax by a paltry 6d. in the £1, but there is not one word in the Budget of any proposal to attack prices or the excessive rates of interest which, are robbing the economy of the funds so badly needed for capital expenditure, social services, educational facilities, hospitals, developmental projects and so on. Worse still, after having itself stressed the need for alteration of the Constitution to give it constitutional weapons to deal with inflation and other problems, this Government dodges the issue. After having appointed an all-party committee of this Parliament to inquire into the need for constitutional reform in the light of happenings since 1901, when the Constitution was drafted, this Government is not prepared to put into effect the almost unanimous recommendations of the committee. It has refused to accept them because if it did so it would be armed with a weapon and be expected to wield it to deal with excessive hire-purchase interest rates, with land speculators and capital gains, capital issues and excessive interest rates in general. We can find no word in the Budget of any intention to give effect to the recommendations contained in the Constitutional Review Committee’s report, despite the fact that this report has been in the Government’s hands for six months or more.

Instead of rectifying those factors which cause our inflationary situation the Government attacks the wage-earners and those least able to bear the burden. If we are, as is boasted, a Christian society, this Parliament could exist for no other reason than that of protecting the weak against the strong. But what does the

Government do? When the weak went to the Arbitration Commission and said, “ The prices of butter, bread and other basic requirements are such that we require an increased income to purchase them for ourselves and our families “, the Prime Minister announced that he would have the members of the commission informed that, in his opinion, to give these people something more, which would create a wider demand for the products of the primary producers and of the secondary industries, would be detrimental to the economy. He sent his advocates to the commission to urge, with their tongues in their cheeks, that the request of the little people of this community be not granted.

At the same time, there has never been any suggestion from the Government side that the Commonwealth should use its existing powers under the Constitution - no referendum would be required - to curb excessive usury. The Commonwealth Bank could be used to end this usury that has resulted in the robbing of public finances of the money that is so badly needed to build hospitals, sewerage and other capital works such as roads and footpaths. Did you ever hear the like of it? Then the Government talks about being a people’s Government!

The Prime Minister, on the occasion of the 1954 election, when it was bruited abroad - justifiably or otherwise but probably justifiably - that the then Leader of the Opposition, the Right Honorable H. V. Evatt, would, if he became Prime Minister, endeavour to influence the Arbitration Court to grant marginal wage increases to the workers of this country, held his hands up in holy horror. He protested against this dreadful suggestion that the Labour Party, if it became the Government of this country, would be so wicked as to endeavour to persuade their honours to give marginal increases to the artisans and professional workers of this country. What unctuous humbug! Early this year, he had no hesitation in sending his emissaries to the Arbitration Commission, and, of course members of the commission are always impressed by the government of the day. I would not say that they are dishonest in that respect. They probably have unconscious bias. On this occasion they accepted the advice of the Government. I do not imply that there was any wickedness on their part. They probably thought “ After all, the Prime Minister is responsible for the welfare of this country and he says that if we give the boys a few more shillings a week we will wreck our economy “. One might not mind so much an approach to the commission along those lines if, at the same time, the Prime Minister had arranged for the Treasurer to instruct the Commonwealth Bank to go ruthlessly into the field of hire-purchase and to make available the means of purchasing to the little men and women of this country. When I say “ little men and women “, of course I do not mean little in intelligence or stature; I am referring to means and income. They should have the opportunity to purchase the amenities and essentials that can make their home life more pleasurable than it otherwise would be. Did the Prime Minister do that? No!

If honorable members have any illusions about what is happening in the field of hire purchase let me give an illustration of a kind that will be familiar to members of the Australian Country Party. A friend of mine recently went to the Commonwealth Bank to obtain assistance in purchasing a tractor the price of which was over £900. He had £450 available as a deposit. He was informed that the bank would finance the purchase at an interest rate of 4i per cent, flat - the lowest rate obtainable anywhere in Australia on hire purchase for agricultural or industrial purposes. My friend said, “ Work out the details and we will fix it up here and now”. The bank manager produced a schedule and said that it would cost so much a month for three years. Then he said, “ You are required to pay £9 to the agent “. My friend asked, “ What is that for? “ The bank manager said, “ That is the hire-purchase tax imposed by the Liberal Government - the Bolte Government of Victoria “. So, if you are a primary producer in distress and you can find only half the cost of your tractor, the Bolte Liberal Government requires that you shall pay £9 in hire-purchase tax, but the man with £900 in cash gets his tractor without any hirepurchase penalty. The Bolte Government is supported by the Country Party although the members of the Country Party needle the Government a bit in Victoria.

The Treasurer has certain powers in relation to the Commonwealth Bank which he should use. He should point out to the bank that the primary producers are in rather difficult circumstances. He should also point out that, generally speaking, wage and salary workers are thrifty people who although they believe in the hire-purchase system are being bled by commercial brigands by means of flat rate interest impositions that represent, in their total, from 16 to 20 per cent, per annum and even more. The Treasurer should tell the Commonwealth Bank that these people are the salt of the earth. He should say, “ Although we have endeavoured to prevent their wages from rising, we want to give a quid pro quo “. Let him instruct the bank to make available to these deserving people, who have adopted hire purchase as an alternative or a partial alternative to savings bank deposits, finance for refrigerators, stoves, wireless sets or whatever equipment they may require, on safe, secure terms and at a reasonable rate of interest. Has the Prime Minister done anything about that? No!

Let us look at some nefarious commercial practices which have amounted to a public scandal. Let us examine the imposition of another form of sinful usury on the people. Who, above all people, is actively associated with it? None other than Sir Arthur Fadden, the ex-Treasurer of this country! This nefarious practice is one of the major causes of the inflated cost of primary production which is making it very difficult for Australia to maintain its international trade balance. I am not blaming the individuals personally concerned, lt is a legal and allowable practice, but it is a nefarious, wicked traffic. Only recently, 84 acres of land were sold at Blackburn in Victoria for £250,000. It was orchard land which was worth, at the most, £200 or £300 an acre. At St. Albans in Victoria 540 acres of land sold for £500,000; no electricity, roads and water supply were provided. At Sydenham, 20 miles out of Melbourne, 1,200 acres of one-sheep-to-the-acre country sold for £273,000, and there was not a single protest or condemnation from the Premier of Victoria, Mr. Bolte, or the Prime Minister of Australia (Mr. Menzies).

What is the effect of this type of transaction? By the time water, roads and other essential services are provided, a young married couple who go to the land agent who is handling the sale of the blocks have to pay such a price for their land and home that a rope is put around their necks from then to eternity. The man who is pushing this type of sale is none other than a former Treasurer of the Commonwealth of Australia, in his association with L. J. Hooker and Company!

In contrast to the Commonwealth Savings Bank and the State Savings Bank, which devote their funds to home construction and public works, these financiers are offering the little man and working class investors of Australia 8 per cent, to invest in their shows. Over and above that, of course, there is a profit margin which these firms anticipate for themselves of perhaps another 8 per cent.

The position is becoming so alarmingly dangerous that Mr. Staniforth Ricketson, of J. B. Were and Company, a conservative firm of great commercial reputation, said recently, when addressing a company with which he is associated, that land speculation and land valuations have reached such a stage in Australia to-day that they are reminiscent of the land boom and the financial crash of the 1880’s and 1890’s. Do not worry about what I say as a radical and a worker and a protector of the rights of men less fortunate than I am, but listen to what Mr. Ricketson has said. J. B. Were and Son is not a firm of pessimists. It is not a firm associated with Labour and the radical movement in this country; but it is a firm of realists who fear for the financial future of this great land.

I will revert now to the other very important factor in our economy in respect to which the Liberal Party and the Australian Country Party have done exactly nothing. For four or five long years I have warned in this Parliament that there are people who monkey with the price they pay for our wool. I was ridiculed when I alleged in this House that the wool-growers of Australia were the victims of pies and associations of buyers who rigged the market against them. To-day the 90,000 woolgrowers of Australia who are battling to produce - the greatest factor in our export trade that enables us to import our needs from other countries and meet our international commitments - are awake to what is wrong. Let me give an illustration. At the slightest provocation the wool-buyers of the world land all their risks and losses back on the 90,000 wool-growers of Australia. Only recently it was announced that the British Government had increased its overdraft rate for money by 1 per cent, and within three days the price of wool in the Australian wool-selling centres dropped by 2± per cent., and within a week by 5 per cent.

One of two things had happened. Perhaps the wool buyers of Bradford cabled their wool buying agents in Australia and said, “ Boys, the overdraft rate is up in England by 1 per cent, and we have to borrow money in England. Reduce the price you will pay to the Australian woolgrowers.” Alternatively, the wool-buyers’ agents in Australia, who have been found guilty and convicted of operating pies and buyer-rings of their own volition - they are pretty bright boys - reduced prices on their own account. Perhaps the 160 of them in New South Wales got together and said, “ Here is a good excuse to offer the Australian wool-grower 2i per cent, or 5 per cent, less than was offered before the British bank rate went up by 1 per cent.”

I say it is utterly impossible for the Australian grower to hold the world to ransom, but he is entitled to receive the help of this Government in the circumstances I have described. He is entitled to expect from it the presentation of a plan which will enable him to sell his wool as a member of an organized body of growers. I have not heard any honorable members opposite say that they are in favour of a reserved price. They are waiting to see how the cat jumps. They should say to the Minister for Trade, “ In the archives of your department you have the records of two successful wool disposal schemes under which the wool-growers, through their representatives, spoke as one unit to the wool buyers of the world “. Cannot a satisfactory scheme be formulated now? Instead of doing so honorable members opposite say “ Leave it to the woolgrowers and wait until they reach unanimity on the introduction of a plan “.

A government with an element of decency and a sense of responsibility to the people of Australia and the wool-growers on whom Australia so largely depends would say to the wool-growers: “ This situation is critical. You are being made the monkeys of the organized woolbuyers of the world. We suggest that you play these people at their own game.”

I repeat that there are, in the archives of a department, complete records flowing how to operate organized marketing in the wool-selling field. But the dingoes, the creatures of the vested interests in Australia, will ever capitalize on the issue when there is no alternative. In the meantime, the ordinary people of this country cannot buy homes, meet their commitments, or obtain amenities. Some of them have to go out and slave in factories in order to obtain their needs. Is the Government going to wake up and do the decent thing? When will it cease these unctuous appeals to the decency of the profiteer, the stockbroker, the Faddens, the Hookers, the land gangsters and the profiteers? All appeals to the decency of such people fall on completely deaf ears. For how long will the Government penalize the ordinary people? If we are a Christian society, this Parliament should be dedicated to the protection of the people against usury and exploitation.

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

– The honorable member for Lalor (Mr. Pollard) started his speech with becoming modesty, in that he proclaimed he knew little of economics. I must confess that I thought he was being unduly modest, because he put his finger on one of the great problems of this country when he said that export prices tended to come down while costs in Australia tended to rise. Indeed, nobody could quarrel with that diagnosis, which is the Treasurer’s own diagnosis of one of our problems. However, the honorable member went on to say that drastic measures were required in order to attack the situation, and thenceforward he completely lived up to his own description of his knowledge of economics as being modest, because he proceeded to make out a case for increased wages. Now, Sir, whatever the rights of the wage-earners may be, there can be no doubt whatsoever that the history of the last twenty years in Australia shows that whenever there has been an increase of wages it has been followed by a period of inflation. The honorable member for Lalor accused this Government of deliberately trying to deprive the wage-earners of their just entitlements. In fact, Sir, during the last eleven years there have been nineteen separate increases in wages given by the Arbitration Court, which this Government upholds.

The Opposition has suggested that drastic action is needed to curb inflation. I want to remind the Parliament that last year and the year before this Government was in the position of having to budget for a deficit - a deficit in an economy which needed some stimulus, in an economy where there was a tendency for unemployment to rise. Budgeting for that def cit gave the necessary stimulus, and the unemployment situation was held and has since improved. Apparently, according to honorable members opposite, in those two years we did not budget for a large enough deficit or for large enough government expenditures. But this year they come to the Parliament and say that we should budget, I imagine, for a larger surplus because, they say, inflation is rampant and drastic action is required. Quite obviously, if drastic action is required in a budget which provides for a surplus, the kind of action needed is to budget for a far larger surplus than the modest £15,000,000 surplus that is budgeted for now.

In any analysis of the inflationary situation which has generally prevailed, not only in the lifetime of this Government but also during the term of the previous Government, we must appreciate that not only is inflation caused by surplus purchasing power at any given point of time, but also that it is partly the result of a psychological factor - the excess demand for the good things in life when the purchasing power to buy them is available. We live in an age in which people, rightly or wrongly, demand increased living standards. They demand them particularly in consumption goods. It is a case of keeping up with the Joneses, a matter of buying new cars, new television sets, new washing machines, in a mechanical age where all these things are becoming available in increased novelty and increasing quantity. People have made increasing use of hire purchase in order to buy those things. There is an increased tendency for two or more jobs to be held by people in the same family, for the specific purpose of enabling the family to buy those consumption goods.

We also have an increasing reliance on the part of people in this country - I suspect that the same tendency exists elsewhere in the world - on the short-term approach, and increasing reliance on the welfare State.

Those things, I think, are a psychological factor. They are the result, in part, of World War II., and the result, in part, of the increasing technological advances of the atomic age and the cold war. This purchasing power in the community, which gives effect to this increasing demand, stems from many things. Honorable members opposite say it comes from profits. It does, in part. It comes from wages. It comes from bank liquidity. It comes from credit. It comes from overseas reserves when those reserves are buoyant. We have heard to-day that our overseas balances, in terms of trade, are down. The terms of trade figure is down to 70 compared with 100 in the base year, 1953. In other words, if our terms of trade were as healthy as they were in 1953, our overseas reserves would be better by approximately £400,000,000. That, of course, is largely beyond the control of the Government.

In this situation there are several matters which have to be considered. The first is: What action should be taken? The next, and equally important, question is: How drastic should the action be? The third question is: How much flexibility should remain? I have said that we should remember that the last two Budgets were for deficits, in order to stimulate the employment situation and to overcome the tightening effect on purchasing power of low overseas prices. We must not forget that employment is only just coming into what we regard as a reasonable balance. I think honorable members will agree that drastic action could be dangerous, and the kind of drastic action that honorable members opposite want us to take - I shall examine some of these aspects in a moment - could quite easily plunge us into a situation where we could fall down on the other side of the fence, and go into a recession and unemployment.

Honorable members opposite have not suggested that this year we should budget for a bigger surplus. That is true. However, they have suggested, by and large, that there should be larger government expenditures. I think that everybody will agree that that will not help to meet an inflationary situation which the Opposition has described as “ large “, “ out of control “ and “ requiring drastic measures “. The Opposition has, indeed, been very silent about the kind of things that should be done in this situation. The Leader of the Opposition (Mr. Calwell) has been living in the past. He says that if he were in government he would provide a good old-fashioned Chifley type of budget. That reminds me, Sir, of a quotation from the story written by Mr. Alan Dalziel about his former employer, Dr. Evatt. One of his comments on the Labour Party - one of his few comments with which I agree - was that the Labour Party is extremely vocal about the past, incoherent about the present, and completely mystified about the future. When we hear the Leader of the Opposition proclaiming that he wants to present to this Parliament a good old-fashioned Chifley type of budget, and hear the honorable member for Fremantle (Mr. Beazley), as we did last night, say that he did not suppose any Treasurer in the world was more successful in holding the purchasing power of money than was the late Mr. Chifley, then indeed we see that honorable members opposite are not only vocal about the past, and living in the past, but are also distorting history.

I want to remind the honorable member for Fremantle, who said that the Chifley kind of budget was capable of holding inflation, that between 1945 and 1949 retail prices, according to the C series index, rose by 30 per cent. They rose by 9.8 per cent, in 1948, when most of the wartime controls to which Labour wants to get back now were still in existence, and by 9.3 per cent, in 1949. When we came into office retail prices were rising at the rate of 10 per cent, a year. Like the honorable member for Fremantle, I do not want to taunt the Opposition with these rather grim facts. I believe that the forces and pressures which were on the Chifley Government then, and which were only dimly comprehended by that government, as they are by the Labour Party to-day, were the same forces and the same pressures that we have to contend with in this day and age. In March, 1947, Mr. Chifley said -

It is evident that some rise in wages and prices is inevitable.

This was the honorable gentleman who, according to the honorable member for Freemantle, could hold down inflation. This is the kind of Budget that the Labour Party wants us to accept to-day. Honorable members opposite are indeed living in a dream world; the past has become dim and unreal to them, but, as has been said, they are extremely vocal about it. In 1949, Mr. Chifley said -

Within Australia there has been a large and widespread rise in incomes during the past two years. The primary industries have had two good seasons and prices, especially for wool and wheat, have been high. There has also been a notable inflow of capital seeking permanent investment here. At the same time, costs and prices have been rising at an increasing rate.

There is Mr. Chifley’s own admission that he was quite incapable of keeping these things down with the controls that were then available to him. The measures that honorable members opposite want to take to control inflation to-day are largely the measures that the Labour Government of the late ‘forties had at its disposal and which it was incapable of using in those days to keep down inflation. First, the Opposition wants an excess profits tax and a tax on higher incomes graduated according to the level of income. As a means of dampening down purchasing power, I suggest that that approach has entirely the wrong effect. At what level does the tax on higher incomes start? How does it damp down the demand which is exercised through hire purchase? How does it damp down the demand for consumer goods which comes from the large mass of people? We should recognize that, no matter how wealthy a person may be, there is a limit to the consumer goods that he can buy. He can buy so many motor cars and so many television sets, drink so much beer and smoke so much tobacco; but there is a limit to it. The large consumer demand which exists in this community to-day does not come from the wealthy few, it comes from the large mass of wageearners who are earning good wages and living in a degree of relative prosperity. If the Labour Party really set out to damp down purchasing power through a graduated scale of taxation, it would find that the increased scale had to start pretty low down to achieve any results.

On the question of excess profits, I point out that an excess profits tax, a war-time company tax, was imposed in 1940. In 1947, Mr. Chifley abandoned it in spite of the inflationary pressures. He said then -

As part of its general review of taxation, the Government has carefully examined the incidence of this tax, and has found that it contains many aspects which make it inappropriate that it should continue in the period of post-war reconstruction.

He went on to say -

In ordinary peace-time circumstances, this tax operates inequitably; it penalizes new industries by preventing the building up of reserves and favours old established industries which have had the ability to build up reserves.

This Government has often been accused of favouring big and established businesses. Yet this very proposal which Labour offers as one suggestion to meet the inflationary situation is a proposal which would protect and entrench established industries and prevent the small man and the newcomer in the competitive field from becoming established.

Labour then suggests that it wants control of hire purchase. How does it propose to control hire purchase? Many comments have been made about interest rates and deposits. Even at the height of war-time finance, when it was necessary to squeeze every penny out of the private sector of the economy, the Government did not think it necessary to control hire purchase. In 1940, Mr. Chifley, as a member of a special committee, signed a report which approved of the existing interest rates. The rates that it approved were very similar to the rates now operating. The final paragraph of that report reads -

To meet this it could be laid down that the added charges expressed as a true rate of interest per annum on the unpaid balance shall not exceed rates as may be specified. Suggested rates for this purpose would be -

That was in 1940. Is this the kind of Chifley budget that the Leader of the Opposition wants us to adopt?

Mr E James Harrison:

– There was a war on then, don’t forget!


– Yes, there was indeed a war on. The one result of restricting interest rates would be to transfer funds to other fields. Inevitably, there would be a tightening of hire-purchase credit and the very people who would be hit immediately are the people whom honorable members opposite ask should have a higher standard of living. They are the men on the margin, the people who can least afford hire purchase. They would be prevented from buying wireless sets, television sets, motor cars and the like. If honorable members opposite want that state of affairs in this economic context, why do they not say so? Again, if they place a legislative limit on the deposits required, the people who would be hit immediately are the people who can afford only small deposits and who are willing over a long period to save money to buy these goods. We do not believe that the state of the economy at present requires this drastic action. Neither do the State governments. The State governments met not long ago and agreed on uniform hirepurchase legislation which would have the effect, if so desired, of achieving a uniform economic result all over the Commonwealth.

Mr E James Harrison:

– You know they could not get it.


– That is a very interesting comment. My honorable friend says that they could not get agreement on interest rates and deposits.

Mr E James Harrison:

– There were too many governments of the same type as yours.


– That may or may not be so, but it is an interesting commentary on the possibility of obtaining an amendment to the Constitution. We have not the constitutional power now, and if the State governments, which are in office because of a political majority in the respective States, are against giving the power to the Commonwealth, it is difficult indeed to understand how the Commonwealth will get it. As for the proposition that the Constitution should be amended to provide for these matters, it is quite clear that the Leader of the Opposition again is living in a dream world out of touch with reality. It is far easier to talk about referendums and to talk about the desirability of the Commonwealth having additional powers than to succeed in obtaining them, as he would well know if he had any regard for the facts of life and the realities of the constitutional position.

Mr E James Harrison:

– Why did you set up the committee if you do not intend to take any notice of its report?


– I will return to the committee in a few moments, because it had some very interesting observations to make.

One of the other factors over which Opposition members want control is capital issues. Capital issues control was available to the Chifley Labour Government until the end of 1948. We believe that this control is objectionable except in extreme emergencies. On 20th October, 1948, Mr. Dedman, in his second-reading speech on the Defence (Transitional Provisions) Bill 1948, referred to the control over capital issues exercised under the National Security Regulations, some of which were being renewed by that bill, and said -

This control has been relaxed considerably since the end of the war, but it enables the exercise of a selective function between ventures to be made and should be continued. It has, I am not surprised to find, much support in business circles as well as in the general community.

The present Government has recently been aware of the objectionable features of selective measures such as import controls. As an administration, we have not only to make decisions as to the general trend of import licensing or capital issues control, according to whether we are trying to control imports or whether we are trying to control capital issues. We also have to make individual selections. Suppose Mr. Smith and Mr. Jones want a licence to import something. You have to make a decision between the two. It has to be an arbitrary decision, and the disappointed one naturally feels that he has been treated unjustly, and he may well have been, because officials are not infallible. There were objectionable features in import controls, and there are equally objectionable features in capital issues control. It is significant that in 1948 Mr. Dedman said, referring to capital issues control -

It has, I am not surprised to find, much support in business circles . . .

Again, the people to benefit from capital issues control are the established big businesses. Those who lose out because they have no chance of getting an import licence or a permit or whatever is required are the newcomers - the men who want to bring fresh competition into the field. They are the men who have little capital but plenty of energy and plenty of ideas, and they are the people that this Government wants to encourage. Despite the charge often levelled at us by Opposition members that we look after big business, Opposition members are principally the ones who would be protecting big business if all these measures that they now advocate were adopted.

It is not considered politically wise or fair to wage-earners to blame them or the arbitration tribunals for the inflationary effects on the economy of wage increases, and I do not want to do so this evening. The Commonwealth Court of Conciliation and Arbitration, as it used to be, and the Commonwealth Conciliation and Arbitration Commission, as it is now, has held from time to time that the Commonwealth Government has the responsibility for counteracting the economic effects of any decisions that it makes, but its decisions clearly place limitations on the field open to the Government. The history of every wage increase that has been granted leaves us in no doubt whatever that every increase has been followed by a period of inflation which has placed the government of the day in difficulty, whether that government be Labour or Liberal. Although the Chifley Government had available to it prices control, cash wage pegging and many other controls, it was troubled by the inflationary pressures caused by the introduction of the 40-hour week. This Government was troubled - greatly troubled - by the basic wage increase of £1 a week when it was trying to hold down the inflationary pressures which that increase caused. As I said earlier, there have been eighteen other wage increases in the last eleven years. Last year, the basic wage was increased by 15s. a week and margins were increased by 28 per cent. It cannot be denied that these increases have added enormously to the problems with which we are confronted in dealing with inflation.

It is not without significance that the Constitutional Review Committee, of which Opposition members suggest that we should take notice, believed that this Parliament should have power to control arbitration tribunals and to direct them as to the level of wages. I point out to honorable members that that was an all-party committee which, as 1 have been reminded, made a practically unanimous report. At paragraph 772 of the report which it presented on 26th November, 1959, the committee stated -

Actions of State legislatures and Commonwealth and State industrial authorities are capable of having an immediate effect over wide segments of industry. Commonwealth policies in relation to taxation, credit, overseas trade and international payments and other aspects of the over-all economy have to be adapted to the decisions of the various unco-ordinated wage-fixing authorities.

In the next paragraph of the report, the committee declared -

With a power to make laws with respect to terms and conditions of employment in industry, the national Parliament could, for instance, direct specialized authorities to fix wages in accordance with principles which are consistent with the attainment of price stability and the entitlement of labour and industry alike to share in the growth of national productivity.

There, we have an all-party committee deciding that this Parliament should fix wages in accordance with principles which are consistent with the attainment of price stability. Have we heard in this debate one suggestion from the Opposition that wages have any effect on price stability in this country? We have not heard from it a single word to that effect. But in the report from which I have just quoted, the Constitutional Review Committee put its finger directly upon one of the greatest problems of our time.

I suggest that the operative word in the passage from paragraph 773 of the report which I have just quoted, if the National Parliament had the power mentioned, would be the word “ could “. The State parliaments have that power to-day. If the State governments wished that power to be used, they could exercise an effect on the national economy by their control over wages. But the State governments, whether Labour or Liberal, abide by the traditional pattern of arbitration which has been developed in this country. I do not know whether they lack the political courage, or whether they believe that wages do not affect the economy, but not one of them has suggested that they should fix wages or direct their own arbitration tribunals to fix wages in accordance with principles which make for economic stability.

Mr Curtin:

– Why did this Government direct the Commonwealth Conciliation and Arbitration Commission ?


– We did not direct it.

Mr Curtin:

– Yes you did. The Treasurer said so in a speech in Brisbane.


– We put to the commission a case that in this instance stability would not be helped by following the increase in the basic wage last year of 15s. a week and the margins increase of 28 per cent, immediately by another wage increase. That case was argued before the commission. Anyhow, Opposition members only emphasize the fact, which I have tried to make quite clear, that they are not interested in achieving stability if that means some restraint on wages. I suggest that they are completely out of touch with economic reality and nhat if this Government or any other that succeeds it is to have any chance at all of coping with the problem of inflation, there has to be a new approach to this problem of wage-fixing in the community. And that new approach must be one such as that which was outlined recently by Professor Arndt. He is a Labour man, one of those intellectuals whom the Leader of the Opposition rejected because he put forward sound economic ideas which did not accord with the old policy of living in the dim past that the Australian Labour Party’ of to-day adheres to.


.- Mr. Temporary Chairman, I support the amendment proposed by my leader, the honorable member for Melbourne (Mr. Calwell), which, in the traditional form, seeks to have the first item in the Estimates reduced by £1. At this juncture, I should like to congratulate my colleague, the honorable member for Hunter (Mr. James), on having made his maiden speech in this chamber. I believe that he will be a most worthy successor to his father, who so ably represented the people of the northern coalfields of New South Wales in this Parliament for more than 25 years. I should like,! also to congratulate the honorable member for Bendigo (Mr. Beaton) and the honorable member for Balaclava (Mr. Whittorn) on their election to the Parliament. 1 turn now to the Budget, Mr. Temporary Chairman. This is a bad Budget. As I see it, it is a disgrace to the Government. The Minister for the Interior (Mr. Freeth) seemed to me to be trying to pave the way for this Government to instruct the Commonwealth Conciliation and Arbitration Commission at future basic wage hearings on the basis of the new consumer prices index. I hope the Government does not follow that procedure. It is the duty of the Commonwealth Arbitration Commission to decide whether or not the basic wage should be increased. Unfortunately the basic wage has been frozen since 1953 because of the actions of this Government, but the Government of New South Wales at least has been able to continue to give workers covered by awards of that State the benefit of basic wage increases in accordance with the upward movements in the C series index.

This is one of the most poorly received budgets I have seen in the last ten years. It is quite interesting to note what the press had to say about it, and I believe that the Budget can be judged according to these press descriptions. The “ Sydney Morning Herald “ said it was a defensive Budget, an ease-off Budget. The Sydney “ Daily Telegraph “ described it as a play-safe Budget. The Sydney “ Sun “ said it was getting a chilly reception. The Melbourne “ Herald “ said there was no life in it. Other newspapers called it a humdrum Budget, a dubious Budget and a negative Budget. One paper blazoned a headline. “ Halt with Holt “. I understand this was inspired by the implication of the Treasurer (Mr. Harold Holt), in the course of his presentation of the Budget, that the Australian economy was developing too rapidly and that the rate of development would have to be slowed down. Of course the Treasurer really implied that the Australian people were much too well off and that their rate of progress would have to be retarded. I wonder whether this was what the Government had in’ mind when it sent Its representative to the Commonwealth Arbitration Commission, during the hearing of the basic wage case earlier this year, to oppose the granting of any further increases to workers.

At this stage I want to voice my emphatic protest at the action of the Government in appearing before the commission in this way. I take the view that if record dividends and record profits can be enjoyed by company shareholders year after year, and particularly by finance companies, the workers are entitled to increases in the basic wage when prices rise, so that they can cope with the increased cost of living. I believe that the workers are entitled to some of the colossal profits that are now being made by their employers.

The Treasurer, I suggest, could be called the apologetic Treasurer, because he seemed to me to be apologizing all the way through his Budget speech. In years gone by the Government had its tragic Treasurer, and for years we had to put up with the author of the horror Budget, Sir Arthur Fadden. But I doubt very much that there has ever been a Treasurer who could have put it over the people as skilfully and as completely as our present Treasurer has been able to do. The right honorable gentleman professes to have the answer to everything. Apparently he can manipulate figures to suit himself. It was this manipulation of figures in the Budget that had me puzzled for a long time. I tried to follow the almost magical way in which the Treasurer has been able to manipulate the figures, and it was not untill T read “ The Taxpayers’ Bulletin “, of 20th August last, that I got a clue to these manipulations. Writing in that journal Mr. I. McKellar White said -

Because of the manner in which the nation’s accounts are prepared, the financial picture presented to Parliament in this week’s Budget is confused and perhaps misleading. The Treasurer’s basic justification for retaining present taxes and imposing more taxes is that deficit budgeting is “ out “ and that last year’s cash deficiency must be converted to a cash surplus in 1960-61. . . . But these figures are the end result of an amazing conglomeration of revenue and capital items and of cash and credit entries that would horrify the auditor of a public company.

I suggest that Mr. McKellar White did not write that article without first having seriously considered what it implied. As I see it. the Australian taxpayers are being bled white to satisfy a Government which is intent on perpetuating a financial policy designed to help big manufacturing businesses, financial institutions, hire purchase companies and their private trading bank shareholders. Taxation in all its forms is becoming heavier each year, and how much longer the Australian electors are going to put up with it I do not know.

In this Budget debate we have listened to speeches from honorable members of the Country Party, who have, almost without exception, spoken of the need to increase primary production as part of a very necessary export drive. They have told us that we must sell our primary products overseas to help build up our international reserves as well as to increase the incomes of primary producers. But not one of them is game to tackle the Government about its wasteful financial policies. This country is crying out for rural development. Everyone knows that. We have millions of acres of land and we have plenty of young men willing to undertake rural development activities if the Government will provide funds for that purpose. Water conservation projects and the provision of good roads are the first essentials to rural development. The honorable member for Maranoa (Mr. Brimblecombe) rightly pointed out what could be done with good roads through the Channel country of Queensland and from there to the coast. In drought periods the stock that would be saved would be worth millions of pounds. Yet not one member of the Country Party is prepared to tackle the Government on its financial policies with a view to diverting some of the funds that the Government has at its disposal into the provision of roads, water conservation and other rural requirements.

The Treasurer claims that he is budgeting this year for a surplus of £15,500,000. “ The Taxpayers’ Bulletin “ says he should have a surplus of £126,000,000. I think the surplus will be much greater still if the figures are properly compiled. I believe the Loan Consolidation and Investment Reserve to be the greatest racket of all time. For years the Government has been using this fund, which has been derived from the workers of this country by means of personal exertion tax, sales tax and other forms of taxation such as the taxes on beer, tobacco, ice cream and various other items, as a means of helping big business. This year the Treasurer expects to place £125,743,000 in that Fund. Last year the fund took £41,382,327, and in the preceding three years it took about £200,000,000. In addition, treasury-bills to the value of almost £60,000,000 were issued and used mainly in defence appropriations. The Treasurer explained, in a maze of words, what is being done with the money, but I venture to suggest that not one person in every thousand has the slightest idea how he or she is being systematically robbed. As I see it, every man, woman and child is being over-taxed in one way or another to enable this Government to accumulate funds so that monopolies, hire purchase companies and huge cartels may be fed with new business. Taxation continues to rise. During the last year there were increases in postal rates, telephones charges and pharmaceutical costs. These are typical examples of what is happening in the field of taxation. There is every indication that during this year further increases will be made in hospital fees, medical expenses, food bills, clothing costs, transport charges and in numerous other avenues. These increased charges will mean additional revenue for the Government, but the plight of the base-rate pensioner, the unemployed, the sick, the widows and those receiving the wife’s allowance becomes progressively worse.

During this year the Commonwealth and the States between them will pay out more than £155,000,000 in interest, or about £7,500,000 more than they paid out last year. This indicates how rapidly the interest bill is growing. Ten years ago we were paying only £85,500,000 a year in interest, but the figure has now almost doubled. The national debt now stands at more than £4,000,000,000. Each year maturing loans must be either converted to new stock or redeemed by the Government. Last year almost £338,000,000 of debt matured and had to be made good. Of that amount £77,433,000 was cashed by the bondholders and no doubt will be diverted to other channels such as hirepurchase investment. This year it is expected that £80,000,000 of maturing bonds will have to be purchased by the Government with money paid by us in tax.

My complaint is that the Government, by refusing to control interest rates and capital issues, has deliberately driven bondholders away from Commonwealth investments to hire-purchase and finance companies which offer much more attractive interest rates and dividends. The Government, therefore, aids and abets the ruthless practice that many finance and hirepurchase companies adopt in the plunder of working people who are often compelled to seek finance from them to meet unforeseen financial obligations - often the result of purchasing household furnishings, amenities and other things - because the Government banking system is not allowed to come to their aid.

It is well known that many finance companies foreclose and repossess goods almost immediately a hirer falls into arrears with his payments. He may have missed a payment due to the onset of sickness, death, unemployment or a host of other legitimate reasons. Mr. V. H. Stanley Low, in his publication entitled “ The Philosophy of Hire Purchase “, denies that such things happen in the field of hirepurchase finance, but the fact that Mr. Low admits that repossessions take place if a hirer is two or more payments in arrears indicates that the hire-purchase companies do not allow for the results of adversity striking at the door of a hirer. When a hirer falls into arrears repossessions are made ruthlessly.

So that there will be no misunderstanding about how I stand in relation to hire purchase, I should like to cite a typical case which came to my notice. Last year a lad of 21 years of age purchased a secondhand motor car for £395. He paid £35 deposit and, when interest and other charges were added to the cost of the car, his total liability was £639 12s. The contract was by way of a bill of sale for £639 12s. which he did not possess either in property or in goods, so his widowed mother was joined in the contract. The lad had the car for exactly one week. It was purchased on 23rd December and was returned to the firm on 30th December. During the week that the lad had the car he had to spend about £12 on repairs. Because it was not in a satisfactory mechanical condition, he would not keep it and sent it back, although the firm claims that it repossessed the car. About three months later the lad received an account for £245 12s. Id. from Latec Finance Proprietary Limited.

Mr Curtin:

– What is the name of the company?


– It is Latec Finance Proprietary Limited, a firm which is considered to be one of the better-class hirepurchase companies. Naturally, being only a boy, he did not have the money with which to meet the account. He then saw Mr. J. Stewart, the member for the State electorate of Kahibah. Mr. Stewart contacted the company and asked for a statement of account. After a lengthy discussion the firm decided to reduce considerably the charges, and stated that if the account was met within a week it would charge only £90 5s. Certain arrangements were made and the firm was paid the £90 5s. If we add to that amount the £35 deposit, plus the cost of repairs, the lad had to pay almost £140 to own a car for exactly one week.

In my view, finance companies dealing in hire purchase, and hire-purchase companies themselves, should be compelled to accept responsibility for the goods which they finance, at least to the extent that the goods remain in good order during the period of the loan. If that were done, there would be far less trouble in relation to hire-purchase transactions than there is now. I know that hire purchase is a matter with which the State governments have to grapple, but I felt that the case of this lad should be mentioned in this place because the Minister for the Interior and other Government supporters have been referring in their speeches to hire purchase.

Let me now return to the Budget. I direct the attention of honorable members to Part C of the Budget, which deals with loan redemptions. It will be seen that last year £164,000,000 was used to reduce Commonwealth and State debt, but the national debt increased by more than £7,500,000. I ask the Treasurer to explain to the people the Government’s plan of action by which interest payments and principal will begin to reduce, thereby making available for rural and city development alike much-needed finance. I agree with Mr. McKellar White that the Budget figures are the end result of an amazing conglomeration of revenue and capital items.

As I see it, almost anything can be done by the Government in its manipulation of figures. Honorable members have become accustomed to hearing the Prime Minister (Mr. Menzies), the Treasurer and some socalled economists saying that we cannot do this or we cannot do that because our international reserves are diminishing or because there is a danger of a sharp rise in the inflationary pressure to which we have been subjected for some years. In my view, that is all baloney.

This Government has survived for almost eleven years on communism, inflation and furphies. I concede that there has been prosperity in spite of the Government, but only the wealthy have enjoyed it. With wiser administration we could have been much more prosperous than we have been. The Chifley Government and, in particular, the present Leader of the Opposition, were the authors of Australia’s progress and development. They sponsored the immigration and the Snowy Mountains schemes, the latter being virtually boycotted by the present Government, which was then in opposition.

Since World War II., revolutions in science and engineering have occurred. Other countries, especially Communist countries, have made the most of those advances. Russia and China leave us for dead when it comes to the use of natural resources for internal development. In those countries they are bridging and harnessing their great rivers to provide power. They are gouging out roads in tortuous mountainous terrain for defence purposes, and building up industries without worrying about international reserves. But we are doing practically nothing in this respect. Recently I saw something of the northwest of Western Australia and the centre of the Northern Territory. The whole area is screaming out for development. Almost every town has a surplus of white and coloured labour. Every area has natural metals which could be used for road construction and for building weirs on creeks and rivers to provide irrigation. But although we are to spend £198,000,000 this year on defence, nothing is being done to develop our roads as a phase of our defence effort. In his maiden speech in this Parliament last week, the honorable member for Hunter directed attention to the possibilities of the Hovercraft as a vessel for the trade and commerce of the Commonwealth. I now say that there is a distinct possibility that within the next ten years the Hovercraft will completely upset our various forms of transportation and that, should that happen, the hundreds of millions of pounds now invested in our railway systems will become a millstone around our necks if we are not very careful. lt is possible that we shall find ourselves with a new system of transport while still being required to pay bondholders for an obsolete railway system which could be used only in the inner city areas. That is something to which the Government will have to give serious thought.

I have already pointed out that the Leader of the Opposition was responsible for the introduction of our great immigration scheme and that one becomes tired of the talk by the Treasurer of too much liquidity in our banking and financial systems. I do not think there is enough liquidity in this country, and I do not accept the Treasurer’s statement that there is a shortage of key materials and some classes of goods. If we have the money, we can buy anything in this country. It is my view that as each boat load of immigrants comes here, or, at some convenient time thereafter, there should be released by the banking system into government and local government administration a certain amount of finance to meet the new calls that are to be made on public and semigovernment authorities consequent upon the arrival of the new people. For instance, at the moment there is an acute crisis in education throughout Australia. New schools and more teachers are badly needed, yet this Government considers it has done wonders by having provided a few million pounds towards university education. I ask: Would there have been the same shortage of schools had there been no immigration system?

City and shire councils alike are protesting everywhere that their respective loan allocations are far too low to enable them to carry out their work with efficiency and satisfaction. The councils have the equipment and man-power to do their work, but they cannot get the best results from their staffs because they are not allowed to commence new work as they have not the funds with which to buy materials. How stupid we can be! 1 ask honorable members opposite why some of the £60,000,000 worth of treasury-bills which was expended on defence in the past two years could not have been spent on local government work or education. There is still quite a number of unemployed people who could be used to work on water and sewerage installations in the major cities of the Commonwealth. Can the Treasurer advance any reason why that work is not being done when we are paying men the dole? 1 want to refer briefly now to the coalmining industry, lt is my considered opinion that the mine worker is entitled to enjoy a shorter working week and increased amenities from the coal industry. More coal is being produced to-day than ever before, yet only a little more than half the employees are still employed to hew it. Mechanization has played a major role in this increased production, and new markets have become available to us from overseas, principally from Japan. New uses for coal are being found continually. Roadmaking is one of them. The Japanese will take our good coking coal if we are capable of supplying it to them.

For the past two or three years, there seems to have been a complete lack of coordination between the Minister for National Development (Senator Spooner) on the one hand and New South Wales Minister for Mines, Mr. Simpson, on the other, in respect of the development of uses for coal. Recently both Ministers visited Japan and neither saw fit to discuss coal exports with the other. Still more recently, the Minister for National Development came to Newcastle to inspect coal loading and handling facilities as well as harbour installations at that port. The Minister did not even extend to the honorable member for Newcastle (Mr. Jones), the honorable member for Hunter or myself the courtesy of letting us know he was in the city. But he did set about castigating the State Government for its failure to provide sufficient depth of water on the Newcastle Harbour bar to enable large overseas colliers to enter and leave the port fully loaded. T say to the Minister that it is this Government’s responsibility to see that harbours that are used in the export trade are capable of accommodating vessels visiting us to load cargo. When all is said and done, this Government cops the income which is derived from exports.

The Minister for National Development chided the State Government for spending about £3,000,000 in establishing three new State mines near Vales Point, in my electorate, which are to be used to provide fuel for the Vales Point power house. In his usual aloof way, the Minister wanted private enterprise to be allowed to provide the coal while the Government undertook the huge cost of constructing the power house. I say to the Minister that the three new mines will be mechanized, that they will be the best-equipped mines in Australia and that they will form the basis of cheap power for sale to thousands of electricity consumers in New South Wales. Further, I remind him that it is not his prerogative to tell the New South Wales Government how it should spend its money. The Opposition in this Parliament is being reminded of that constantly by Ministers.

During the past six years, the coal industry in New South Wales and elsewhere in Australia has undergone radical changes. Mechanization has displaced hand labour, and more coal than ever is now being won with fewer men. It is possible that coal can compete with other forms of fuel, the principal one being the petro-chemical industry, if only there were co-ordination of effort between this Government and the New South Wales Government. I should like to know why the Minister for National Development refuses to co-operate in the work of investigating the possibilities of a coal-based chemical and liquid fuel industry. The State Minister for Mines has tried his hardest to obtain the co-operation of this unco-operative Minister. I understand that Mr. Simpson wrote to the Minister for National Development when it was learned that the Commonwealth Government was to establish an expert committee to investigate the uses of coal, but the Minister for National Development ignored the offer of the New South Wales Government to place its best officers at the Commonwealth’s disposal.

The State Government had offered the services of Professor Hunter and Mr. A. F. Perkins to the Commonwealth Government. I ask the Minister for Social Services (Mr.

Roberton), who is sitting at the table, to ascertain whether the Commonwealth expert committee on coal utilization is functioning. If it is functioning, then we of the Opposition want to know why the offer by the New South Wales Government was not accepted. I also ask this Government to make available special funds for the deepening of the bar in the Newcastle Harbour so that the coal export trade may develop to the maximum extent.

Time will not permit of my traversing social service matters now, and while I congratulate the Government on the merging of the income and property means tests, which will no doubt help many aged persons, the Government stands condemned for its neglect of many other aspects of social services. Again, time does not permit of my developing the argument in support of greater increases for civilian widows and the wives of invalid pensioners, but I do record my protest at the Government’s neglect of these people. The wives of invalid pensioners are receiving shocking treatment from the Government, and I ask the Minister for Social Services, in the name of humanity, to have a further look at their case for an increased allowance, especially where women are looking after more than one aged person or where the wife herself is almost an invalid.


.- In commenting on the speech by the honorable member for Shortland (Mr. Griffiths) I want to refer to only one point. He spoke of the development of national resources and compared conditions in Russia with those in Australia. I only want to point out to him that in Australia we pay good wages for such work whereas in Russia all development of national resources is carried out by slave labour, and those circumstances are. I believe, a blot on civilization to-day.

In dealing with the Budget, I shall refer, first, to some aspects of the National Welfare Fund and then I shall deal wi,h the Opposition’s case. Many of the arguments put up by honorable members opposite, seemingly on behalf of the workers, were not sincere; they were merely a cloak to hide from the people of Australia the real objective of the Australian Labour Party - the obtaining of power as a government in order to socialize Australia beyond the point of no return.

I should like to point out, in reference to the National Welfare Fund, that our social services expenditure is now over £330,000,000 and that of this very large total no less than £163,000,000 is expended on age, invalid and widows’ pensions, £75,000,000 on the various health services and £74,000,000 on child endowment. It will be remembered that last week in this committee, the honorable member for Hindmarsh (Mr. Clyde Cameron) said that child endowment could be doubled at a cost of only £74,000,000. The honorable member meant, of course, that it could be doubled at the cost of an extra £74,000,000 over and above the amount which is paid out at present. The honorable member for Hindmarsh indicated that extra taxes were the answer to any questions as to where the money would come from, lt will be remembered that it was the Menzies’ Government that introduced child endowment and then extended it to the first child against bitter Labour opposition.

Sir, the family man welcomes all the assistance he can get because he is faced with many family problems while receiving a standard wage, not subject to variation for the larger family. Despite the benefits already available, I feel that the time has come to re-examine the position of the man with the large family. In this reexamination consideration should be given to the benefit of the larger family and to our need for increased population. The Budget, Sir, has revealed that age, invalid and widows’ pensions are to be raised by 5s. per week. This is not as much as I expected but it gives the married couple a joint pension of £10 weekly, although it still leaves the single pensioner at a disadvantage, despite the assistance of the 10s. supplementary allowance.

In the last ten years the Government has done a great deal, and certainly a lot more than was ever done by any previous government, to extend eligibility for pension benefits by a progressive easing of the means test. It is here, Sir, that I must pause a moment and, like honorable members before me, pay a tribute to the honorable member for Sturt (Mr. Wilson) for his sterling work and untiring efforts to find a solution to the problem of devising a means test that would be fairer to the older persons of the community. Honorable members of the Opposition have been silent on the new means test. By their very reticence on this subject, they have indicated, if silently, their approval of this forward move by the Menzies’ Government. I believe, Sir, that in the new means test formula we have one of the greatest steps forward ever taken in the field1 of social services.

Briefly, the new means test will ensure that no person who qualifies for an age, invalid or widows’ pension will receive less than the full base pension until the income and property component, or the property component where there is no other income, exceeds the permissible income of £182. Income or “ means as assessed “ over £182, of course, will reduce the pension on a sliding scale. The property component is calculated by taking the exempt amount of £200 from the value of property held and dividing the remainder by ten. Under the old scale, a person with property of £2,200 and no income received a pension of £60 per year. This will now be increased to £242. A person with £3,200 in property and some income received no pension previously but will now get £92. A person with £4,200 of property will get a pension if he has no other income. It is to be remembered that a married1 couple can have twice these amounts of property with their pension entitlement cutting out at a total property holding of just over £9,200.

The definition of property, in all these cases, Sir, excludes the house in which the applicants live, or its contents and does not include a motor car if one is owned. Under the new means test, a widow with children is allowed exempt property of £1,000 and therefore if she has property to the value of £3,250 she will now draw a pension of £230. The term “ income “ will exclude income from property and the pension itself but will include earnings from wages and superannuation. I hope that all persons of pensionable age will examine their property circumstances in order to see whether they will benefit from the new means test formula. If any person has any doubts on this matter I would suggest that he gets in touch with the Social Services Department or the Federal member of Parliament for his district. I feel sure that all members of this chamber will be readily available to clear up any points of doubt.

It is regrettable, Mr. Temporary Chairman, that the administrative work involved in the changeover is so great that it will be early next year before the new means test can operate. Between 120,000 and 200,000 people will benefit from this new means test and we must keep in mind the extra work involved in the re-assessment of all existing pensions and the calculations needed for new applications. The increase in the present maximum rate of pension to £5 will, it is expected, apply on the first pay day following the passage of the necessary legislation. Sir, the real test of a budget is its application to the overall economy of the nation rather than its effect on any one section of the community. I suggest that the Treasurer explained that fairly well when he said - . . the Commonwealth Budget has to be regarded as a means to guide the broad trend of the economy in the direction of certain wellestablished goals.

The Treasurer has the job of forecasting the future with a greater degree of accuracy than that attributed to Nostradamus. I consider that when the Treasurer introduced this Budget he acquitted himself well in a most difficult test of his ability to read the economic future.

Now, Sir, this year’s Budget was the medium for another test - the test of the ability of the honorable member for Melbourne (Mr. Calwell), for the first time opposing a Liberal-Country Party Budget, as Leader of the Opposition. This was a test, Sir, in which he failed very badly. The Leader of the Opposition, when speaking earlier in this debate, did not contribute any alternative proposals to this Budget for 1960-61. He gave no indication of what he would have done, if he had been Prime Minister or Treasurer, apart from expressing his desire for extra powers - powers, Sir, which history shows and the honorable member for Moreton (Mr. Killen) well illustrated, would not readily be given by the Australian people. However, Sir, that would not worry the Leader of the Opposition, for every socialist leader has an iron hand ready to use, when need be, provided he gets the chance. And many of his colleagues think along similar lines as I will show later in this speech.

Last Saturday night, as I sat writing this speech, a radio station broadcast a programme called, “ The Voice of the Week “. And who was the star of the show? None other than that celebrated star of the television screen, the Leader of the Opposition. When asked the central theme of his attack on the Budget, the honorable gentleman, amongst other things, said -

This country is in a worse position than ten years ago.

By accident rather than design, I heard that programme twice, and therefore I know I have the sympathy of honorable members, but at least I did find out that the programme was well-named “ The Voice of the Weak “.

Sir, let me examine the ability of the honorable member for East Sydney (Mr. Ward) in, these matters. What was his forecast in 1948? The honorable member said in that year, when he was a Labour Minister -

I now turn to the real threat to the people of Australia … the threat of another depression . . . there will be mass unemployment

Sir, not long after that statement was made, the Menzies Government came into office. None of those awful predictions came to pass, but year after year the honorable member for East Sydney and others on the Opposition benches have made these g’loomy forecasts. To-night the honorable member for Lalor (Mr. Pollard) followed that pattern. Disappointed and frustrated, year after year, by our continued prosperity, the honorable member for East Sydney, made a stern attack on last year’s Budget when he said -

This Government has been very lucky. Each time that it thought it was facing economic difficulties, something turned up to help it out.

Let us take the honorable member for Parkes. What was his contribution to this debate? He said, last week -

We oppose the Budget. It is sufficient to say that we shall have neither hide noi hair of it, because it is anathema to us as socialists and Laborites.”

When speaking after an interjection about an alternative Budget, the honorable member used the same excuse as the honorable member for East Sydney - lack of time! He said, “ Unfortunately we cannot give an answer in 30 minutes “. Mr. Temporary Chairman, in five days of discussion in this committee, the Opposition has still not come up with any alternative proposals. Its arguments, in the main, have been purely vote-chasers, presented in some hope that they may help it, one day, to get control of the country. Labour has been in the wilderness since 1949. This is the eleventh Liberal-Country Party Budget it has opposed since then, and despite all the experience of honorable members opposite in opposing Budgets they still say that they have not had time to present a case. They have no case and, Sir, the Prime Minister put it well, when he said -

That is what Ls wrong with the Labour Party. It is practising a dead philosophy with a dead collection of ideas.

Speaking as the “ Voice of the Week “, the Leader of the Opposition said, “ The country is in a worse position than ten years ago.”

Mr Peters:

– Hear, hear! So it is.


– What is the position to-day? This Government has managed the affairs of Australia so carefully, with the cooperation of the people of this country, that there is now £1,523,000,000 in savings bank accounts. The Leader of the Opposition (Mr. Calwell) and his supporters have accused the Government of destroying the economy of this country, but the fact remains that the people have now nearly three times as much money in savings bank accounts as they had when the Opposition was in power. To whose credit does the money stand? It is owned by the ordinary people, whose spending power assures prosperity for everybody. This Government, Sir, looks after the people. It always has done so and it always will, and that is why it enjoys their confidence. That is also the reason why the Government faces the future with confidence. The Leader of the Opposition, when a Labour Minister, said of the 1948-49 Budget brought down by his government -

This is the greatest Budget that has ever been presented to the Australian Parliament.

He is a modest fellow -

This Labour Government has managed tho affairs of Australia so well that the people now have £681,000,000 in their savings banks accounts.

I ask the Leader of the Opposition whether he will concede the same praise to the 1960-61 Budget now being discussed by this committee, when I again remind him that the people of Australia now have over £1,500,000,000 in their savings bank accounts. I would like to say, Sir, as we are defending this Budget, that the defence rests; but the full facts of our case must be stated and therefore I shall continue.

The number of motor cars, washing machines, radiograms, refrigerators and television sets in the homes of Australians reflects a much higher standard of living for the wage-earners. Over 70 per cent, of these people own or are buying their homes. They have cleared or will clear their own blocks of land, which is not easy work, as many of us know, but work that has a real satisfaction for that pioneer spirit which is inherent in every Australia. These people plant lawns, develop gardens and, in general, improve their homes and land in the most attractive manner possible. This property ownership is a remarkable feature of the post-war period, and emphasizes that the great majority of Australians are becoming people of property, and, as such, they like the feeling of ownership. What they have they do not want to lose.

How are their efforts viewed by the Labour Party? The Labour Party regards them as little capitalists. Just before the last election, the honorable member for East Sydney (Mr. Ward) was very forthright when, in a television interview, he said that he was in favour of the nationalization of land. On the same subject, Sir, I now turn to a speech made by the honorable member for Yarra (Mr. Cairns) who was elected last week to the executive of the Parliamentary Labour Party and now sits on the front bench with the honorable member for East Sydney and the honorable member for Parkes (Mr. Haylen). We understand that the honorable member for Yarra received 28 leftwing votes out of 43, so at least we know where the balance of power lies in the Opposition, and the colour of it. The honorable member for Yarra indicated in this House last year that he considered that if the value of a person’s land or property increased, the person listed as the owner of that property should not be allowed to keep any increase in value that might be received on the subsequent sale of that property. He concluded his speech by saying -

Therefore, the individual should not be permitted to reap the unearned increment which is present in the land value.

Speaking of socialism, socialization and nationalization, what did the honorable member for Port Adelaide (Mr. Thompson) say? He is a man of mild appearance and one would not suspect him. He said -

Had the Labour Party remained in office, private savings banks would not be in existence to-day - I make no bones about that.

In 1948 the honorable member for East Sydney spoke on banks and said -

Irrespective of the Privy Council decision, once Labour has spoken and said the banks are to be nationalized, the issue is beyond doubt.

That is a very important point - that once Labour has spoken the issue is beyond doubt. In 1958 the same honorable member said -

The Labour Party is seriously handicapped by its lack of control of television stations, the press and radio stations.

In the same year, together with delegates from the Soviet Union, red China and Mr. R. Dixon, general president of the Communist Party of Australia, speaking to the Seamen’s Union in Sydney, the honorable member for East Sydney said -

If ever there was a country which needed a socialist government and a socialist policy to ensure prosperity it is this country.

Mr Cairns:

– Who said that?


– The honorable member for East Sydney. By interjection the honorable member for Kingsford-Smith (Mr. Curtin) recently said -

We’ll fix you fellows when we get in.

From that we must conclude that we are almost surrounded, as it were; and therefore we were not surprised to hear that on the agenda for the Labour caucus meeting to-day there was an item to enable discussion on the industries that the Australian Labour Party will nationalize when it comes into power. What industry has the honorable member for East Sydney got his eye on? I want the House to know why the Labour Party paved the way for the establishment of this industry in Australia. The honorable member for East Sydney said -

The firm of General Motors-Holden’s has often been mentioned in this Parliament. I want the House to know that it was a Labour Government which paved the way for the establishment of this industry in Australia. We encouraged it but we never intended, when we embarked on that policy, to place this great overseas company in the favorable position that it occupies to-day.

What did the Labour Government intend? lt was so sure of being re-elected in 1949 that it only wanted to get General MotorsHolden’s Limited established in Australia before nationalizing the motor industry and placing it under the iron hand of, peculiarly enough, its biggest critic to-day, the honorable member for East Sydney, who was then Minister for Transport.

The Opposition has criticized the success of certain companies, but the companies which members of the Opposition have mentioned are only a percentage of the total number of firms in Australia, lt is interesting to note that a 1960 survey of manufacturing activity in Australia covered more than 800 firms in 36 different manufacturing industries. Some companies make good profits, some make less and others have fluctuating fortunes. Business is always a risk. I feel sure that when the Government does tackle the monopolies and restrictive trade practices legislation the matter of unusually high profits will be examined, whether they are contributed to by either monopolies or restrictive trade practices. Things change. The honorable member for Grayndler (Mr. Daly) when he was the member for Martin, is on record as saying, when Labour was the Government -

Profits earned by Australian companies have increased considerably under this Labour Government.

And he was very proud of that at the time! Be that as it may, the Opposition to-day is against any profit anywhere, anyhow. In an endeavour to hide their inability to realize the important part that profits play in the development of this country, honorable members opposite stand up in this Parliament and decry any person who makes a success of his business. The Labour Party wants every profit-making organization socialized, and every profit-making person penalized. When the honorable member for

East Sydney and the honorable member for Yarra start casting socialistic eyes on the land and the property of the Australian citizen, it is time the continued efforts of the Labour Party to bring the socialist new order from overseas to this country were brought into the open.

The Leader of the Opposition and his caucus colleagues have a theory that it is better to socialize all profit-making concerns, although they know that under nationalization only losses will be made. What they really want is control of the work force and the power that goes with it. If they ever secured that, the newspapers of the day would soon carry a cartoon, showing the Labour Party’s shadow cabinet of to-day looking down on an Australia economically reduced to wreckage, with the honorable member for Yarra providing the punch line as he says to the honorable member for East Sydney, “ Well, anyway, we certainly cut out profits “.

I believe, Sir, that the opportunity to earn a satisfactory profit is a part of the very spirit of a free country. It is one of the foundation stones on which to build a great nation. One has only to look at the progress and development of this land of ours since 1949, when we came into office, to see how a young country can go ahead. Take the employment figures. The work force is now over 4,000,000 people, and unemployment is down to 1.1 per cent, of the work force. When the Labour Party was in office, the honorable member for Parkes (Mr. Haylen), a leading spokesman for the party, indicated that he would be quite happy with a 5 per cent, pool of unemployed. Well, Sir, that, was not good enough for the Menzies Government when it came into office, and we developed an economic climate which has now brought that figure down to l.l per cent.

Last year alone, nearly 100,000 people were placed in employment. When we look at the latest review of the employment situation, where do we find the highest ratio of unemployment? We find it in Tasmania, a State under a Labour administration. It is well remembered that when my own State of Western Australia had a Labour Premier last year, the Western Australian unemployment figures were the highest in the Commonwealth - 2.6 per cent, of the work force. In the eighteen months that a Liberal-Country Party Government has been in office, that figure, as a result of co-operation between industry and the Government, has been reduced to 1.6 per cent., and is still dropping. Surely, Sir, these facts tell the story, and emphasize that full employment and the making of profits go together.

To-day, more than ever, the progress and prosperity of our cities, our States and our nation are dependent not only on the success of the primary producer, but also on the number of successful companies and their prosperity. The success motive is one of the driving forces that stimulate new inventions, new products, new services and new plants, and therefore, Sir, more and better jobs. It is success and the hope of its continuance that gives people the money and the incentive to go ahead on a longterm basis, instead of in a more expensive short-term manner. It is economic success that enables companies to originate and take advantage of all the technological advances that improve services and quality,, and, even more importantly, keep down the cost of providing them.

The evidence is overwhelming that companies that show good results do the best job for their customers and employees and contribute a great deal to the prosperity of the community. Along with a degree of inflation have come great and lasting gains - the gains of full employment, of rising living standards, of unprecedented industrial peace, and a rate of industrial and population growth rarely equalled by any country, at any time. However, despite this, Sir, the formula for the 1960’s must be “ expansion without inflation “, and I feel that the 1960-61 Budget, presented by the Treasurer, will contribute materially to the performance of that task.

Finally, Sir, may I pose this question: Should we accept our present state of prosperity as the highest point of economic growth we will achieve? Are we to accept it as the “ main “ of prosperity? I hope not, Sir, because I believe that the future of this country, for which we are legislating to-day, will bring to our children, well described as the “ leaders of the twentyfirst century”, a level of prosperity and progress that many people to-day could not really anticipate. Australia is a great country, with greater prospects than any other nation in the world. Our course has been firmly set, we have an able pilot at the wheel, and only the war clouds that always seem to linger on the horizon can interfere with the future that lies ahead, which I hope is one of peace, prosperity and happiness for us all.

Progress reported.

page 646


Unemployment in Queensland - Papua and New Guinea - Communism - Security.

Motion (by Mr. Cramer) proposed -

That the House do now adjourn.


.- Last Wednesday night I read to the House a telegram which the Leader of the Opposition (Mr. Calwell) had received from the secretary of the Trades and Labour Council at Gladstone, in Queensland. The telegram was to the effect that a state of emergency existed in that town because of the imminent cessation of employment in the meat industry, for seasonal reasons. During the course of my remarks I referred to the fact that the Country Party Premier of Queensland had applied to this Government for a special grant in order to enable Queensland to deal with this position, and that this Government had refused the request. I had risen to support the application for a special grant and to ensure employment for the meat workers who would shortly become unemployed.

On Thursday night, in the adjournment debate, I was subjected to a bitter and premeditated personal attack by the honorable member for Lilley (Mr. Wight) because I had appealed to the Government for a grant of money to ensure work for the meatworkers in Queensland, as the working season in the meat industry was drawing to a close. I desire, Mr. Speaker, to reply to some of the honorable gentleman’s statements, but I do not propose to indulge in a personal attack, or to stoop to his level by replying to all his vicious and untruthful personal statements. I have been in this Parliament for 24 years and I have never attacked any honorable member personally. I do not propose to start doing so now. The Labour Party’s platform and policy, and the shortcomings of anti-Labour governments, are sufficient to supply me with material for speeches that I want to make.

The honorable member for Lilley said, first, that I had been instructed by the Leader of the Opposition to raise this matter of the seasonal unemployment of meatworkers in Queensland. The Leader of the Opposition, as I informed the House last Wednesday, handed me - a member representing a Queensland electorate - a telegram that he had received from a trades and labour council and said, “ You can handle this “, to use his expression. I said to him, “ The best way to handle this proposition is on the adjournment “. That is how I came to bring the matter before the House. The honorable member for Lilley knows full well that I do not require any instructions when it comes to trying to do something for the State that 1 represent, and trying to do something for those who, unfortunately, through no fault of their own, will find themselves in the very near future in the army of the unemployed.

Those were the motives which actuated me, Mr. Speaker, in bringing that matter before the House. I do not propose to reply to the whole of the diatribe of abuse that was poured out here by the honorable member for Lilley, which was untrue and too nauseating, but I want to refer to some of the statements he made about Mr. Jim Keeffe, who to-day is the secretary of the Queensland central executive of the Australian Labour Party. The honorable member for Lilley said that Mr. Keeffe had visited the Kennedy electorate. That is true. He also said that Mr. Keeffe had reported that I would lose the Kennedy seat. The Queensland central executive had had a meeting and was very worried about it, but Mr. Keeffe had contacted the Leader of the Opposition. After I had read the honorable member’s speech I telephoned Mr. Keeffe and read to him the statements made by, or attributed by “ Hansard “ to, the honorable member for Lilley. Mr. Keeffe gave an absolute denial and asserted in most vigorous language that the statements were grossly incorrect, that he had made no such report, that there was never an” such discussion in the Queensland Central Executive and that the Leader of the Opposition was not contacted. Where it will end, if honorable members come into this Chamber and base an attack on falsehoods? The Parliamentary system has enough to bear without having this sort of thing foisted upon it. Mr. Keeffe said that no report had been made by him and hence there was no discussion. In any event, if a report had been made, how would the honorable member for Lilley know about it? Why, no member of the Queensland Central Executive would lower himself to talk to the honorable member! 1 shall give the honorable member some indication of my standing. As I said earlier, I have been a member of this House for 24 years, and on ten occasions I have been endorsed by the Australian Labour Party as its candidate. At every election, with the exception of the by-election in 1936, I have had an absolute majority. I had an absolute majority at the 1958 election. That shows my standing in the electorate. My standing within the Parliamentary Labour Party can be gauged by the fact that when Labour was in office, on two occasions I was elected by the party as Chairman of Committees and was further endorsed when I was elected to be a member of the Chifley Cabinet. The speech made by the honorable member for Lilley reveals why he has for eleven years occupied a back bench and why he will never be a member of a federal cabinet.

The honorable member alleged that I was under fire within the Labour movement, I put that allegation to Mr. Keeffe and again received a vigorous denial. In other words, the statement was untruthful, as was the whole speech. When I referred it to Mr. Keeffe, he said that my standing in the electorate and in the movement was never higher. As I said at the outset, I do not propose to reply to all the malicious untruths that were uttered here by the honorable member and I do not propose to reply to any personal attacks he may make in the future. I do not want to waste my time or the time of the House in replying to them. I have never indulged in personal attacks and I do not propose to start now. These personal attacks in the National Parliament do not add to its dignity or prestige. There are enough people outside attacking this institution without a member of it encouraging them to continue their vicious campaign.

The honorable member for Lilley knew full well that he had no reply to the appeal that 1 had made on behalf of the Trades and Labour Council at Gladstone, so he followed the old maxim, “ If you have no case, then abuse the other man “. I thank the honorable member for Cunningham (Mr. Kearney) for speaking on my behalf on Thursday night, in reply to the honorable member for Lilley. I regret that I was not in the House on Thursday night. 1 had left to return to Brisbane so that 1 could take my wife home from a hospital where she had been a patient for three weeks. If I had been here, I would have replied to the honorable member in the same terms as I have used in replying to him to-night, because I still possess a little self-respect.


.- Professor Gluckman is an anthropologist of world reputation. The Vice-Chancellor of the Australian National University, Sir Leslie Melville, said of him -

Professor Gluckman is a very distinguished anthropologist. That is what we are interested in and that is why we invited him to come to us as a visiting fellow.

In 1934, Professor Gluckman was the Transvaal Rhodes Scholar. So, he is no young radical and no woolly-minded youth. From 1943 to 1947, he was the Director of the Rhodes-Livingstone Institute of Social Studies. In 1947, he was appointed lecturer in social anthropology at Oxford. In 1949, he was appointed professor of social anthropology at Manchester. In 1960, he was refused permission by the Australian Government to go to New Guinea.

His record is that of a distinguished anthropologist. But it is more than that. To have received the appointments that I have recited means that he has a stable character and that he is politically stable. No person would have received these appointments were this not so. But in March he applied for permission to go to New Guinea for three weeks to examine some anthropologic:*! work that has been going on there and ‘he has now been refused permission to go. His qualifications are such that the refusal could be based only upon security objections. The Prime Minister (Mr. Menzies), refusing even to use the word, said that the information had come from the usual sources.

The questions 1 ask are: Is Professor Gluckman a Communist? If he is, why does the Government not say so and stand up to its decision? Why does it hide behind an anonymous statement? If the Governmen has anything against Professor Gluckman, let it say so and stand by it; but the Government does not choose to follow that course. If Professor Gluckman is not a Communist, then the Government should withdraw its refusal and let him go to New Guinea. The inference to be drawn is that the Government’s refusal was based on security. I shall quote from an editorial in the Sydney “ Sun “ to-day. These comments were made -

But once that magic word is mentioned in Parliament, nobody is obliged to say any more.

Tt comes, therefore, to this, that a distinguished scholar can have his reputation muddied without ever being openly accused of anything at all. The implication is that he might be a trouble-maker.

A suspected wrong, or no wrong at all - who can ever know? - becomes by secret decree a real wrong imputed to a person and he has no redress. Now, part of Professor Gluckman’s record is that in 1960 he was refused permission to go to New Guinea. This record will stay with him for the rest of his life. The Minister for Territories (Mr. Hasluck) has an academic background. Would he like to have such an entry in his academic record? But suppose that Professor Gluckman is a security risk: What harm can he do in New Guinea in three weeks? If he misbehaves there, he can be forced to leave New Guinea, just as anybody else can. If there is a genuine security risk involved in this, why not state it and stand up to the decision? But no, the Government prefers the star chamber method. As the Sydney “ Sun “ said -

A suspected wrong, or no wrong at all - who can ever know? - becomes by secret decree a real wrong imputed to a person and he has no redress. The editorial in the “ Sun “ put it this way -

Is the Australian Government really scared of what could happen during a three weeks’ visit by a research worker in the course of his academic duties?

And this is a research worker with the academic background that I have outlined. Is it reasonable to believe that an anthropologist, who is no mere boy but an experienced man of about 50 years of age, with a world reputation, a former lecturer at Oxford and now a professor at Manchester, would do harm in New Guinea, even though his wife, who is not to go with him, was perhaps a member of the Communist Party some years ago? Surely the Government is not scared about this. Or is its security so unstable and its defence so weak that it is scared of a situation like this? The Sydney “Sun” says-

What it should be scared about is the enormous discredit it is bringing on itself by its foolish and nasty methods.

What can be done about this situation? What can Professor Gluckman do? What can we do? The Prime Minister, with insolent self-confidence, says, “ Nothing will be done. If I say a man is a security risk, he is a security risk. Nobody is even to know the evidence against him, if there is any. Nothing will be done.” Will the Government back-benchers, these fighters for liberty, do anything? Or does the Sydney “ Sun “ correctly describe the situation? That newspaper, in its editorial, says -

The worst of it is that the tame and lilylivered backbenchers of the Government haven’t got the ordinary nerve to fight their leaders -.on this star chamber approach to people’s liberties - and reputations.

If that is not true, let Government supporters stand in their places and prove that it is not true and that they are great fighters for liberty. Government back-benchers have shown no tendency to fight for anybody’s liberty. Some of them have been prepared meekly to accept the statements of their own arrogant leader. Some of them presumably have been prepared to pimp for the security service.

What will the university staffs do? The Melbourne “ Age “ reports -

The committee of the Australian National University Staff Association is to meet later this week to discuss the Gluckman case.

The university staffs are not worried only about this case. They are worried about a number of similar ones. The report in the “ Age “ continues -

The committee is expected to refer the case to a meeting of the federal council of Australian University Staff Associations.

I hope the universities will take up this case. No one can truthfully say that they have been very stout defenders of civil liberties in recent years. Some members of their staffs have been prepared to speak out, but generally they have not said much on this subject. Many people in the universities know that this kind of security screening has been going on for a long time. Many people know that decisions of this kind, which have no relevance to the job that a man is doing or wants to do, have deprived people of appointments, in the same way that the decision in this instance has deprived Professor Gluckman of his visit to New Guinea.

Let me now summarize the position as I think it ought to be seen, Mr. Speaker. If Professor Gluckman is a security risk, surely the Government ought to give the reasons for its decision on that ground. If it says he is a Communist or something else, surely it ought to have the courage to stand up to that statement and prevent these star chamber methods from going any further in the Australian community. They have already gone too far. If Professor Gluckman is not a security risk, the Government ought to admit that it has made a mistake, and it should let him go to New Guinea.

Finally, I cannot see how any one with the academic background of this man can do any harm in New Guinea, whatever his politics may be. But, as far as I can discover, there is no evidence whatever that the objection rests on the politics or associations of Professor Gluckman except, possibly, his association with his wife, who may some years ago have been a member of the Communist Party. As far as I can discover, that is the full extent of the evidence against him. If this is the case, why does not the Government withdraw its allegation and allow Professor Gluckman to go to New Guinea?

This is not just a matter for us, Mr. Speaker. It is a matter for Government supporters - the people who say that they are defending liberty against Communists. Let them defend liberty against these star chamber methods now that they have an opportunity to do so.

Mr SPEAKER (Hon John McLeay:

Order! The honorable member’s time has expired.


. Mr. Speaker, I cannot support the Government on this issue, because I believe that the Government’s handling of the matter has played right into the hands of the Communists, and has made it possible for their chief mouthpiece in this House to make the sly and slimy speech that we have just heard. I believe that in fighting communism it is essential that we expose Communists. If we do not do this, we shall continue to lose.

Mr Cairns:

– You have been losing pretty consistently so far.


– And no doubt the honorable member is pleased at that. He said that we have been losing pretty consistently so far in our fight against communism, and he said it in a tone of pleasure which revealed his real feelings in this matter.

Let me now come back to the issue of Professor Gluckman. He is a distinguished scholar who was asked by the Australian National University to come to this country. I do not know whether or not he is a Communist. It has been said that if he is a Communist agent it is undesirable that he be given free access to New Guinea. But it is not good enough for the Government simply to say that he will not be given free access to New Guinea and to leave the matter at that.

I believe that the Government has not been making full use of our security resources in the fight against communism. These resources should be used to make public the facts about Communists and about Communist organizations and associates.

The way to combat communism is to let people know who the Communists are and who they associate with. One of the prime functions of our security service should be to find’ these things out and make them public. The Government apparently does not realize this, and therefore I say that it has failed to use the resources of the security service properly in the fight against communism. The Communists hate exposure as the devil hates holy water, to use the old phrase. Exposure is the thing that the Communists fear most, and I think it is in point to remind the House that the Opposition, this evening and at other times, has co-operated with the Communists in endeavouring to prevent the security service from doing anything to expose them. The Oppo sition considers it disgraceful for any one to find out anything from the security service or to give that organization any information. Only a few minutes ago, the honorable member for Yarra talked1 about people who had “ pimped “ to the security service.

Mr Clyde Cameron:

– That is right.


– Yes. Let him stand by it. I believe that the security service is our defence and that every loyal Australian has a duty to co-operate with it in exposing the Communists. I believe that the Government is at fault for not having realized this and for not having published the information which has been in its possession over the years. We need to bring these things a little more into the open. We need to let in the light. The Communists will not operate so successfully if we know who they are and who associates with them.

Mr Clyde Cameron:

– Does the honorable member suggest that we want an organization like the M.V.D. here?


– You cannot have it both ways. A moment ago, the Australian Labour Party was protesting - and for once, I think, protesting rightly - that information was not being made available.

Mr Kearney:

– It never is.


– I am glad to hear the honorable member’s voice joining in the protest, too. I hope the Government will have a change of heart and alter its policy and that it will start to make this kind of information available, and I trust that the honorable member will then raise his voice in commendation of the Government’s action in doing what Labour was asking it a few minutes ago to do.

Perhaps we do not appreciate the way in which the Communists are working and the forces they are mobilizing, Sir. They are operating now largely in the domain of public opinion. What is generally accepted as espionage is not important at the present time, at any rate in Australia. I heard a question asked to-day by an honorable member on this side of the House, suggesting that the real work of a Communist agent consisted of spying on our defence installations and things of that nature. In the present context in Australia - and I make that limitation - such things are of no real interest to the Communists and their cause. The Communists are working in the domain of public opinion. They are working through their under-cover associates. They are working with people who pretend sometimes not to be Communists, but who set out the Communist line, who associate with Communists for the purpose of helping them in their plans. In their case it is not just a matter of meeting with Communists, it is a matter of co-operating with Communists, and in this regard the public record of debates in this House affords sufficient condemnation of the attitude of some honorable members opposite.

But 1 do not want to make to-night a charge of that kind against the Opposition. What I say is, I hope, of a rather more important nature. The Communists are operating in the domain of public opinion. An important Communist operative is not just a simple spy. He is a man who is out to mislead the public by using a privileged position on the staff of a journal, or in this House, to put the Communist cause, pretending all the time not to be a Communist. This is the man whose personal associations with Communists must be exposed, and the job of the security service, its chief job, must be to make available to the public information about the really effective field in which the Communists are working. Unless the Government realizes this, unless it has a change of heart and policy, it will continue to be beaten on the propaganda front, as it is being beaten now. I think the handling of this matter of Professor Gluckman, the failure to give information, the action without evidence to justify it, has played right into the Communists’ hands and has made possible the speech that we have just heard from the accustomed Communist mouthpiece in this House.

Mr Cairns:

– I wish to make a personal explanation, Mr. Speaker. I claim to have been misrepresented by the honorable member for Mackellar. He said two things to which I take exception. He said, first, that I was pleased that we were losing the battle with the Communists. I think it is a tragedy that we are losing the battle, and I think we are losing it because of narrowminded, bigoted people like the honorable member for Mackellar. He said also that I was the mouthpiece for the Communists in this House. I deny that. I think it is an insult.


– Order! The honorable member cannot enter into a debate. If he claims to have been misrepresented in a speech, he can do no more than make, his personal explanation.

Mr Cairns:

– I say that those two statements are completely false and constitute misrepresentation but they are just what 1 would have expected,


.- It is with some sadness that the Opposition has to protest again to-night at the attitude of the Government to security matters. If ever there was a clear case of the faceless informer, it is the case involving Professor Gluckman. We thought that when the Americans destroyed McCarthyism and repudiated the man who destroyed the writer, the anthropologist and the university professor, we had finished with that kind of evil. But it appears to have settled in Australia, and it becomes worse and worse because we are mishandling these matters so tragically. When the honorable member for Mackellar (Mr. Wentworth), who is almost paranoiac in regard to what he considers to be the Communist menace, has to repudiate the Government because of its handling of this situation, we see what a sorry mess the Government has got itself into. When the arch-priest, the archetype of smear in matters involving the Communists, turns on his own party and says, “ You have mishandled this “, the people begin to see that our charge that the Government acts on information supplied by the faceless informer or indulges in McCarthyism is well founded, and that these practices are at their peak.

I know that honorable members opposite are ashamed. To-night they are cowed and silent, because not only in this House but also in the press of the country, they have been pilloried - and justly so - for the stupid, nonsensical, out-of-date manner in which they have handled this matter. Some time ago, the Leader of the Opposition (Mr. Calwell), because of the importance of New Guinea, suggested the appointment of an all-party committee, so that we could decide what we, as Australians, could best do for the future of New Guinea. Mr. Speaker, how do you think honorable members on this side of the House, if they were appointed to such a committee, would approach the situation, knowing that the Government has its underground officers who may say, “ This man may not go to New Guinea. This activity is subversive “? How will honorable members feel about it when they know that if they ask the Minister for Territories (Mr. Hasluck),” a question about the refusal of a permit for a man to go to New Guinea he will sit dumb and mumchance, and that when they ask the Prime Minister (Mr. Menzies) about it, he will, as he has done on this occasion, use his well-known arrogance and say, “ I support the action of the Minister “.

Of course, this attitude is entirely wrong. The whole history of our administration of the system of permits to visit New Guinea has been extremely bad. I do not know or any other department that has such a list of people as the list in the Department of Territories of people who have been refused entry to New Guinea. They have been refused entry for no given reason. The door is simply slammed. The case of Professor Gluckman is extremely bad, because anthropologists are needed in New Guinea. It is almost the end of the earth, anthropologically speaking. It is a place where the scientists can apply themselves to very real problems. The Minister knows this. But besides the case of Professor Gluckman, there was the case of Marie Reay, some time ago. Fred Rose was also refused entry. At one time a girl called Norma MacArthur, a dietitian, was refused entry. An anthropologist named Worsley, a pupil of Professor Gluckman, was also refused, as was a man called Epstein also an anthropologist.

Mr Hasluck:

Mr. Epstein is working in the Territory now.


– At one stage he was refused entry. This is from the records, and the Minister knows it. He may since have been allowed to go to New Guinea. If the Minister is so informative about Epstein, will he tell us something about Gluckman? As the honorable member for Yarra has pointed out, this man has a record of sober service in Britain. He is associated with the Manchester University. His books and lectures on anthropology have considerable status. But suddenly the faceless informer leaps up, as he has done before in this country, and the Minister says that Professor Gluckman cannot go to New Guinea. The man is smeared. We have frequently heard Government supporters deploring smear tactics, but in this case Professor Gluckman has been tragically and almost irrevocably smeared, and we cannot get any information from the security service about it. The Minister must say something to-night because of the national outcry about this matter.

Mr Beazley:

– International!


– Yes, the international outcry. It is said, I understand, that the professor is a Communist, although no proof is given of the allegation, or that his wife may have been a member of the Communist Party. How wicked can you get in this country? You have not got them proscribed. What sort of a free world do you live in when you do these things?

The honorable member for Mackellar has shown how cowardly, supine and arrogant the Government can be. He is the spokesman for the Government in matters of this kind, but he found that this kind of action on the part of the Government does not “ gee “ in Sydney. It is not accepted with approval by the press. The “ Sydney Morning Herald “ is prepared to thrash the Government about it, as is the Sydney “ Sun “ and probably other newspapers as well. So now the supporters of the Government turn round and say, “ Something went wrong with the mechanics of the matter. This should not have been handled in this way “. But that is not the question at all. The real question is concerned with the morality of the situation, the ethics of it and the plain democracy of it.

The Government has made a bad situation worse by not facing up to what it has done. If the security service is responsible, if there are grievous reasons why the professor should not go to New Guinea, we should know them. But we know perfectly well that there has been a slip-up. Slowly, almost imperceptibly but certainly there has been a deterioration ever since we gave greater powers to the security service, which, in the manner of all bureaucracies, is now riding rough-shod over the Government. The Minister is in a dilemma. He does not know what to do about the matter, because the Prime Minister has already said, “ I do not care what you think about it; this man just will not be allowed to go to New Guinea “. We then try to clarify the matter by asking, as the honorable member for Yarra has done, “ Why have you barred a reputable anthropologist from New Guinea?” We ask the Minister, who has - or had in his early days - some of the elements of a civil libertarian: Why have you acted so? Can he justify the arrogance of his own leader? Is he afraid to give an explanation when the cock of the walk has said,” I alone have said so, and it is so. I am the State and the State is me “-or “I”, as the case may be. We get back to the original question which was raised by the honorable member for Yarra and which the Government must answer to-night.

The honorable member for Mackellar (Mr. Wentworth), in his usual smearing way, talks about the mouthpiece of communism. Make no mistake; so far as we are concerned, this is the mouthpiece of Australianism, this is the mouthpiece of decency, and this is the mouthpiece of democracy. Why has the Minister fallen into the error of perpetrating a situation and a campaign which cannot be democratic in any sense? We know that there have to be some elements of security, but this case has been badly fumbled and shockingly mishandled. The Government throws up its hands in despair and tries to bluff the Opposition. We will not be bluffed. We demand to know the true position with regard to Professor Gluckman. Why have he and his wife been maligned? Why has this situation developed? Why has a long list of anthropologists been excluded from New Guinea? Finally, in the face of this desecration of democracy, how can the Government normally expect the Opposition to cooperate with it in its programme of development of New Guinea?

Minister for Territories · Curtin · LP

– The main reason why I rise now is to correct immediately and as clearly as I possibly can a statement which was made by the honorable member for Parkes (Mr. Haylen) in which he recited the names of certain persons. This illustrates to me, more clearly than anything else could, the dangers and the evils of a debate such as this. The honorable member listed the names of certain persons. His statements are completely unfair to several of those persons. Dr. Marie Reay has never been excluded from Papua and New Guinea, and we would welcome her presence there at any time, yet, with the greatest of ease the honorable member listed her name with others! Dr. Norma MacArthur has never been excluded from the Territory, and we would welcome her presence there at any time.

Mr Haylen:

– Now you would, but you excluded her previously.


– We have never excluded any of these people. Dr. Epstein is at present working in Rabaul on anthropological work which we regard as of some importance. Yet the honorable member recites this man’s name and smears him with the others! I do not think he did so with ill intention; he did it through either ignorance or carelessness. But that is the kind of evil which, more than any other evil, emerges from this kind of debate.

I find myself in something of a difficulty because on my own side of the House the honorable member for Mackellar (Mr. Wentworth) wants me to make a declaration of everything we know about any suspected person, and on the other side of the House Opposition members also want me to make statements. Their motives are entirely different. The honorable member for Mackellar, as I understand him, wants me to brand every Communist, to say everything discreditable that I may know about any Communist, and generally to go into a process which I regard as McCarthyism. I do not propose to do that. On this occasion I cannot share the views of the honorable member for Mackellar. I think that the course which he is counselling would lead to a great deal of unfairness and injustice to a great number of people.

On the other side of the House the Opposition also suggests that we should disclose every fact that we know, or every piece of information that may have been placed before us in the course of the work that we are doing. The core of this matter seems to lie in the fact that we live in a very uncomfortable and a very unpleasant world. It is not a world which we as Australians created; it is not a world which most Australians want to see, but it is a fact that we live in a world in which there is suspicion, subversion, constant trouble-making of various kinds and in which unfortunately - I say “ unfortunately “ with the greatest sincerity - all of us have been forced into a state of doubt and uncertainty which calls for extraordinary caution. If we lived in a different kind of world I am sure that every member of this House - or nearly every member of this House - would want to be free from things of that kind. The fact is that we do not live in the kind of world in which we can be free from them.

Australian governments - not only the present Government but also the previous Government - living in that kind of world, have found it proper to give a certain responsibility to certain persons. A certain responsibility has been given to the Australian Security Intelligence Organization. In this particular case, the law of the land has given to the Administrator of Papua and New Guinea a certain responsibility and, over and above this, a responsibility has been placed on the Government which is answerable to this Parliament.

The history of this matter is that the Administrator of Papua and New Guinea, having received certain advice, refused to issue a permit to the person in question. Before that decision was communicated to the applicant, the decision and the information on which the decision had been taken was brought to my notice. After taking advice myself, I came to the opinion that the responsibility which had been placed on the Administrator had been discharged by him with proper care, with due notice to the information supplied to him, and with a proper sense of fairness to the person concerned. In those circumstances I did not feel justified in taking action to countermand the decision which the Administrator had taken. That is where the position rests. 1 suggest with all respect that the question which is before this House is not whether the demand for information for one reason or another should be acceded to - information which might cause difficulty and even pain to people - but whether we should maintain the sense of responsibility which we have placed on the security service, on the Administrator and on the Government. To my mind, that is the whole issue. Holding thi . view, and knowing that I have the support of the Government in my refusal to alter the decision of the Administrator, I do not propose to discuss in detail the case of this very eminent scientist.

East Sydney

.- 1 had not intended to make any reference to this matter, but I have been induced to do so by the extraordinary statement which has just been made by the Minister for Territories (Mr. Hasluck). I remind the Minister that this is a question of entry to a trust territory and that the Australian Government is answerable to the United Nations Trusteeship Council for its conduct of affairs in the Territory. 1 should imagine that the council will want to know something of the activities of this Government in keeping out of the Territory people who have legitimate business in it. This professor was invited to Australia as a guest of the Australian National University. Strangely enough, the Minister was not satisfied with trying to smear other people; he smeared a member of his own party - the honorable member for Mackellar (Mr. Wentworth) who is about to depart for the United Nations as one of the Australian Government’s representatives. No doubt, he will be asked questions by the Trusteeship Council relating to what this Governmen is doing. What has happened in this instance indicates that the Opposition was correct when it opposed the development of the security service in Australia as a political police force.

Let us look at the matter sensibly. Every one knows that there are numbers of known Communists in Australia who move freely around the community. They are permitted to do so and, as long as they do not infringe any of the laws of the land, no action is taken against them. Although questions may be asked in this House, no action is actually taken to prevent them from going wherever they want to go.

What damage could be done by allowing Professor Gluckman to enter the Territory? I do not know Professor Gluckman. 1 had never heard his name until this debate commenced. I do not know whether he is a Communist, or whether his wife or any member of his family has ever been a member of the Communist Party I would say that even if Professor Gluckman were a Communist, unless there were some further, or more substantial reason, why he should not be permitted into the Territory, 1 would not regard that as sufficient reason for the Government preventing his movement into that particular area. Let us be sensible about it. When, we were talking about the security service in this Parliament, we were told that the AttorneyGeneral (Sir Garfield Barwick), who is a responsible Minister, was responsible for the security service, yet we are not given even a glimmer of the reason why this man was excluded.

As members of this Parliament know, 1 was a former Minister for External Territories and 1 had the job of administering the Territories during a much more difficult and dangerous period than the present. During the war period the military authorities were in control, and they regulated the movement of people in and out of the Territory. When the civil administration returned, we were inundated with applications from lots of people who wanted to go to the Territory. Many of these applications were refused temporarily because of difficulties which existed, but on no occasion when the Labour Government refused permission for anybody to go into the Territory were we not prepared to state plainly in this Parliament, if we were questioned, the reason why that person had been excluded. In this Parliament, that is said to be a democratic Parliament, why cannot we be told why Professor Gluckman is not permitted to go into the Territory? It is not sufficient to say merely that the Government is satisfied that he should not be allowed to enter it. In a democracy not only has the Government to be satisfied that the personal liberties of an individual are not being impinged; the Opposition has certain rights in respect to this matter. The Opposition has a duty to see that the individual and personal liberties of people are not interfered with, as they have been on this occasion by the action of this Government.

The Minister for Territories (Mr. Hasluck) has accused my colleagues of smearing some of the people they mentioned as having been previously excluded from the Territory, but what he done? He has not said straight out that Professor Gluckman has been engaged in subversive activities, that he is a troublemaker, but he mentioned those things as reasons why people are excluded from the Territory. He then said that he is not going to tell us anything more as to why Professor Gluckman has been kept out.

Is it not quite obvious that the Government has had a report from the security service about this man, .and that it is not prepared even to indicate the nature of that report to this Parliament? Who gave the Government the information? As a matter of fact, it has never yet been proved to the satisfaction of anybody that the director of the security service, its deputy director, and the Prime Minister (Mr. Menzies) are truthful people. We all recollect the occasion during the Petrov royal commission when the sworn evidence of the Director and the Deputy Director of Security was denied by the Prime Minister; their evidence was in conflict with a statement that he had made in this Parliament. That has never been cleared up satisfactorily. All three could not have told the truth. Either the Director and the Deputy Director of Security told the truth and the Prime Minister lied, or the reverse was the case.

My colleagues have asked what pimp gave this information to the security service. I want to make it quite clear, if honorable members want reminding of it, that the people employed by the security service are not all recognized as members of that service. The service has agents. Everybody knows that it has been disclosed on occasions that it has all sorts of disreputable people acting as agents for it smearing people. As a result of their smears, reputable people are being denied their ordinary, individual liberties. What will happen when this professor returns overseas? It will be well known abroad that he was prevented from going into the Territory, and people will begin to use their imagination as to why he was excluded, with the result that this man’s reputation will suffer.

I say that the Minister has not cleared the matter up satisfactorily, and I hope that members of the Opposition will continue to return to this subject-matter until such time as the Government is prepared to disclose to us some of the actual facts and happenings in regard to this particularly discreditable incident. .


.- It is not Professor Gluckman who has been so much smeared by this episode; every person in Australia has been smeared by it. I take an extremely dim view of a government which has had eleven years in office and is so unsure of itself and so lacks confidence in its ability to administer a Territory under its control that it is afraid to allow a single individual into that Territory, no matter what his political affiliation may be.

Mr Whitlam:

– On an Australian National University project!


– Yes - on an Australian National University project that is sponsored by an institution which is a creature of this Parliament. The most serious aspect of the matter, I think, is that it is a denial of individual civil rights and a surrender of the authority of Parliament and of the courts to a security service for which the proposed provision in the Estimates this year is almost £700,000. Over the last ten or eleven years this organization has given those who have any regard for civil liberties, civil rights, and the Australian way of doing things the greatest possible concern

The Minister for Territories (Mr. Hasluck) is doing himself a grave disservice, and I think that every member of the Cabinet is doing himself a grave disservice, by allowing the Prime Minister’s creature in this regard to be a rubber stamp of their own illiberalism. This is a serious matter. It is not only a trespass in the case of the Territory of Papua and New Guinea; it affects, also, the naturalization of citizens in this community. I will not mention any names here to-night, but I have taken these matters up with the Minister himself. People I know well, and for whom I can personally vouch, have over the last two or three years been denied naturalization upon the recommendation, probably, of the very same people who are implicated in this matter. This has been allowed to happen in Australia, which is one of the most secure nations of the world.

The Minister for Territories has told us that he is unsure of himself, that he has his suspicions, and that we live in a world that is under the threat of subversion. He told us that he is afraid. On the contrary, Mr.

Speaker, I feel that this country has something to be proud of. In a world that is riven with subversion, at least there is one nation that can say fairly and squarely that it trusts all the people within its borders. After all, this Government brought Krupps here. It not only allowed him to come here, but it entertained him while he was here. We remember that Commonwealth cars waited for him at the airport. I personally do not care whether Krupps comes or goes. The 10,000,000 people of Australia can handle any number of Krupps, just as they can handle any number of Liberals, if it comes to that.

The principle we must accept is that in this world at the present moment there are very few places where people can be free and easy and above suspicion, where a handful of Communists can float around the country unknown, because the strength of this nation lies in the loyalty, the unity and the very truth of its structure. During the 60 years since federation and the 170 years of our existence, we have never had a traitor. We have never had to descend to the levels which other nations have descended to in order to keep their people loyal and true.

I have the greatest admiration for some aspects of the administration of the Minister for Territories, and the liberalism of the Minister for Immigration (Mr. Downer) is well known. The Prime Minister (Mr. Menzies), who ought to be a spokesman in the world for truth and freedom, is doing the Australian nation a disservice. I do not stand here this evening on behalf of Professor Gluckman, whose academic qualities are beyond dispute. I stand here as an ordinary Australian representing 40,000-odd voters who stand foursquare behind the Labour Party. They demonstrated that eight or nine years ago over the Communist Party Dissolution Bill, and they have done so ever since. I believe I express their attitude correctly when I say that ‘phone tapping, the denial of individual rights, and the charging of people with bogus associations are things for which they do not stand. In the one thousand years through which the system of British justice has developed, we have learned sometimes to be suspicious even of the courts, with all the panoply of law and protection that is behind them. How much more suspicious ought we to be of an irresponsible security service, which arrives at its judgment in secret, is not answerable to anybody, and which therefore can prejudice people’s freedom to such an extent that their whole future is prejudiced? I believe that over the last ten or eleven years the Liberal Party has been guilty of doing a disservice to trie nation in connexion with the many things that have been traversed here time and time again, and there will be no freedom or future for the nation until this Government is removed from office.


.- First, Jet me say to the honorable member for Mackellar (Mr. Wentworth) that I am surprised that he, a product of the Australian universities and a man with a family background of some fame, should so lower himself as to refer to my friend, the honorable member for Yarra (Mr. Cairns), as sly and slimy. The honorable member for Yarra might be accused of many things, but the adjectives “ sly “ and “ slimy “ have no application to him at all. He is direct and to the point; he is open and above board, and I resent that slur by the honorable member for Mackellar. The next point to which 1 wish to refer was raised by another product of the Australian universities, and 1 am sorry .1 have to emphasize these things. Our universities are great centres of learning. Those who attend them have access to great works and the opportunity to listen to great lecturers; and they have available to them an education which should at least make them broad-minded, knowledgable and sensible.

The Minister for Territories (Mr. Hasluck) said here to-night, in a sort of aside, in justification for the action that has been taken, “ Unfortunately, we live in a world of suspicion, subversion and trouble “. Have we not always lived in such a world? Forgetting suspicion for the moment, let us examine the assertion that we live in a world of subversion. Of course we do, and we always have done. Did not the early Christians go out on the highways and byways and endeavour to subvert the Pagans, and did they not make a good job of it? Has not mankind throughout the democratic world always had the privilege of listening to attempts by peddlers of all sorts of philo sophies and beliefs to subvert them? Why, a man came to my home only a year or so ago - he was a nice looking gentleman - and said, “ Good afternoon “. 1 said, “ Good afternoon, brother “. He said, “ Have you ever thought of the hereafter? “ I said “ Brother, I have never ceased to think of it “. He said, “ And what conclusions have you arrived at? “ He was on a subversion campaign, and I was pleased to meet him. I said, “ After a lot of thought, after enjoying the company of all sorts of people who tried to subvert me this way, that way and the other way, and having enjoyed all their endeavours - after having read many but not enough books on all sorts of theories and philosophies, and having been deeply impressed by many of them, and after having received what I think was a very good Christian education in my young days, I came to the conclusion that wherever I go in the future I hope there will be black men, white men, yellow men, sinners, saints and all manner of people. If there are not, I do not want to be there.” He said, “ You are on the wrong beam “.

It is a great privilege in a democracy to have the opportunity of being worked on by these people. I have associated with Communists. Fascists, black people, yellow people, indeed all sorts of people including young Liberals and Country Party members. As a matter of fact, a former Premier of Victoria once pleaded most ardently with me to join the Country Party. He said, “ You are a moral to beat that ‘ Nat ‘ bloke “. He worked on me trying to subvert me. Incidentally, I had been defeated at that time and was on my beam end. I said, “ Brother, how could I face the workers who put in their shillings and pennies to help put me into Parliament to represent them? “ In a democracy, we are supposed to be intelligent enough to be able to sift the grain from the chaff. Some of us make mistakes, but at every election honorable members on the Government side try to subvert the people who are balanced voters, just as we try to subvert them. The art of subversion is a human requisite, but members of the Government parties seem to think it is their prerogative exclusively to endeavour to subvert people.

God forbid that the day should ever arrive when members of any political party or organization who evolve a philosophy, theory or religion shall be denied the right to exercise what is after all a divine gift according to the dictates of conscience, provided always that they do not do violence to their fellow-man but endeavour at all times to be good and decent citizens. Whatever our political views may be, one of the great things of which the people of the United Kingdom are immensely proud is that for a century they have enjoyed freedom of political and religious thought, no matter how popular or unpopular their beliefs may be. Probably because of that right and because the people of the United Kingdom have been taught to sift the good from the bad, Britain is as strong as she is to-day and is still one of the great centres of civil liberties and human rights.

I regret what has been done in this instance. I think a shocking injustice has been done. Let me now give an instance of how, an injustice having been done, some people in authority have been persuaded to do the right thing. Some horrible things are going on to-day. Not so long ago, I was told that a man was sacked from a big industry in Melbourne. He went to his union secretary and said, “ I have been sacked “. The union secretary asked, “ What for? “ The man replied, “ I do not know. They told me I was not required any longer.” The union secretary went to the industrial officer of that organization and said, “What was this man sacked for? “ The industrial officer said, “ Security “. The union secretary asked, “ What about security? “ The industrial officer then said that the man was not desirable. The industry in which he was working was not engaged on what could be described as defence work even in the remotest sense. The union secretary protested and asked the industrial officer whether there was anything wrong with the man’s work or his willingness to work. The industrial officer said, “ Nothing whatsoever “. When the union secretary asked, “ Is there anything wrong with his conduct? “, the industrial officer replied, “Nothing whatsoever “. After that protest from the union secretary, the man was restored to his former position.

It would appear that the industrial officer, under an arrangement permitted by this Go vernment, was getting information from the security service that this, that and the other man had a particular philosophy. What is being done in connexion with a man who may have a Communist philosophy or a Fascist philosophy could also happen to a man who may have a particular religion, if that happens to be unpopular with the Government. This state of affairs is fraught with danger. I do not blame the security people, who aTe vested with a job, so much as I blame Ministers who do not open their minds to broaden them and who do not ensure that men are able to go to any territories that we administer and openly see what is going on. It is fantastic to suggest that one man, an anthropologist, who no doubt understands native people by virtue of his specialty, could in three weeks do something wicked to the native men and women of New Guinea. Is the Government afraid that he will go to the United Nations conference and say something detrimental about the Government’s administration, or that he will misrepresent it? I believe that the Minister has done a good job in New Guinea, but if he misrepresents the Government and tells lies - if he does the wrong thing - what is wrong with the Government’s representatives at the United Nations repudiating what he says?


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

Mr Clyde Cameron:

– I believe that the honorable member for Mackellar (Mr. Wentworth) has done a great service in attacking the Government for the way in which it has handled this matter. He was quite right, I think, when he said that the Government had made a shocking mess of the Professor Gluckman case. The honorable member certainly told the truth when he warned that if the Government continued to handle cases of this kind in such a manner it would still further discredit the Australian Security Intelligence Organization in the eyes of the general public. This conduct is responsible for the fact that the security service in Australia to-day is generally regarded by thinking people as a hopelessly inefficient, discredited organization.

I believe that if this kind of thing goes on for much longer, and if the security service is permitted to smear innocent people, or, if, though it is not: smearing innocent people, the Government refuses to give the facts so that that impression will not be created, the public of Australia will rise up in rebellion against this political pimping and lying that goes on under the name of security. Why, it is this very kind of thing that makes us all hate the Soviet system! It is this kind of thing that made us turn against the Nazi system, with its Gestapo. It is this kind of thing that our men thought they were fighting in World War II. It is this kind of thing that we believe the war was fought to end for all time. Yet we are aping the Russians and the Gestapo as faithfully as the Russians themselves can ape their own secret police. We have in this Government all the elements of the form of dictatorship that exists in countries whose systems we so heartily deplore.

The “ Sydney Morning Herald “, a newspaper that cannot be accused of radical views, published the following statement in to-day’s sub-leader: -

What possible reasons can our security officials have for supposing that a short visit to New Guinea by any person, whatever his views or aims, could do harm? There are no defence secrets in New Guinea; and there are adequate legal provisions to deport any person who tries overtly to make trouble with the natives. To ban even persons who are undesirable, let alone those whom somebody suspects of being undesirable, by secret and unchallengeable processes based on secret information, offends basic ideals of justice and good government and will suggest to our critics overseas that we have indeed something to hide in the Territory.

What is the reason for the ban? Is it correct that the “ Sydney Morning Herald “ has hit the nail on the head? Is it true that we are keeping Gluckman and people like him out of the Territory of New Guinea because we are trying to hide something from the Afro-Asian bloc which now controls the Trusteeship Council of the United Nations and which could take control of the Territory at any time that it cared to put the matter to a vote?

Is it true that the Government does not want Gluckman and others to go back to the Trusteeship Council and talk about the racial discrimination that operates in a territory where a dark man gets 6s. 3d. a week and rations for work which no white man would do for less than the basic wage? A native carpenter, qualified to do a job equal to that done by any white man, is paid no more than £4 15s. a week and rations, whereas a white man would have to be paid £18 or £19 for the same work? Is it because a maximum rate of £100 is being fixed as compensation for a native who is killed or injured during the course of his work, whereas the minimum rate for a white man who is killed is of the order of £2,000? Are these the reasons that the Government does not want people like Gluckman to go to the Territory?

Is it because the Government does not want the Trusteeship Council to know that it will not allow a black man to go into a picture theatre which shows pictures that have not been specially screened against the native people? Is it because the Government does not want people like the United Nations Trusteeship Council to know that at Moresby it is possible to stand and watch natives being served at a porthole in the side of a butcher’s shop because the white people are the only ones allowed to enter by the front door? Is it because natives are the only people not allowed to drink in the Territory of Papua and New Guinea, although natives are asking for the right to drink and the right to be penalized if they abuse the right they are given? Is it because the Government does not want people to find out that at Madang three weeks ago a twelve-year old boy was given a month’s jail for committing a petty theft, and that a white man was fined £150 after he had been convicted of manslaughter, having killed a coloured man out of Lae about eighteen months ago? Is it because the Government does not want people to find out that a native at Lae was committed to eighteen months’ gaol for stealing a bit of bacon out of a refrigerator, when his employer had not been properly feeding him?

Mr Mackinnon:

– That is not true.

Mr Clyde Cameron:

– It is true. In addition to stealing bacon, he stole a bit of fritz and some buns. It is true that he got eighteen months’ gaol for the theft of those scraps of food from the refrigerator. It is also true that while we were in New Guinea a native was committed to prison for five years on a house-breaking charge.

While these penalties are imposed on natives for petty offences, a white man who kills a native and is found guilty of manslaughter is fined only £150. There is no gaol term at all for him. Does the Government want to keep Gluckman out because it does not want him to see large areas of land that the Government is appropriating and re-letting to the Bulolo Gold-Dredging Company and others for 6d. per acre per year, on a 50-year lease basis, as has been admitted by the Minister himself? Nearly 19,000 acres of beautiful grazing land in the Markham Valley was given to the Bulolo Gold Dredging Company four weeks ago, while there are pockets of native population which are bursting at the scams because they have not enough land to live on. The Government is giving - and “ giving “ is the right word - land to the Bulolo Gold Dredging Company and others. It is no wonder that the AfroAsian bloc on the United Nations Trusteeship Council is showing some concern about the way we are administering New Guinea.

We are not going to help ourselves by keeping people like Gluckman out of the place. We are only going to make the suspicion deeper than ever. I believe that this is a situation that has caused great discontent. I. should like to know why it is that the Prime Minister (Mr. Menzies) will not give us the reasons for this gentleman being kept out of the Territory of New Guinea. The Prime Minister has said that the reason he cannot give the reasons is that to do so may do some harm to the man concerned. Good heavens! No more harm could be done to this man than has already done him? I say to the Governas an undesirable person, as a person not fit to go into the Territory. What more harm could you do the man than you have already done him? 1 say to the Government: For goodness sake tell us the worst. It could not be any worse than the position as it stands. There is something else that we might inquire into. When did the Prime Minister first learn about the matter? Did he learn about it after the decision was irrevocably taken by the Administrator, or before that? If he learned about it before, it is reasonable to assume that he wholeheartedly supported the decision.

It is not forgotten that the Malayan Prime Minister, Tunku Abdul Rahman, recently told the Australian Prime Minister that if those in New Guinea did not get out quickly and give self-government to the Territory they would be thrown out. Is that the reason that the Prime Minister came back and said it would be better to give the people of New Guinea self-government too early than too late? In saying that, of course, he was absolutely correct. It is treatment of the native peoples such as I have mentioned, and attempts such as this to keep out of New Guinea those who understand anthropology, that will do more than anything else to make the Afro-Asian bloc that now has a majority vote on the Trusteeship Council, decide to walk in and take the Territory from us.

Minister for Labour and National Service · Lowe · LP

– I rise to support my colleague, the Minister for Territories (Mr. Hasluck) and to make certain points clear to the House. Although the points have already been made. Sir, it becomes perfectly obvious that the Opposition will not recognize the facts and, furthermore, is prepared to distort the facts in order to gain some small political advantage.

What are the facts of this case? The first fact is that the original decision was made by the Administrator. He made his decision after a consideration of all the relevant facts and after obtaining information from all the normal and usual sources. It was the Administrator who first decided what should be done in the case of Professor Gluckman. The matter was then sent on to the Minister for Territories. After he had looked at the file, he came to the conclusion that there was no good reason why the decision of the Administrator should be changed. I go a stage further and say that every member of the Government now knows that the Minister acted in what we think are the best interests of the Territory. I make it clear that it was the Administrator who made the decision, after considering all the evidence. That evidence came from the usual and normal sources - the sources from which it would have been obtained by a Labour government had it been in office.

Sir, I think you will agree, as even the staff officers’ organization of the National

University has agreed, that great caution must be exercised by the Administrator in deciding who shall go into the Territory. Many parts of the world are in a condition of flux, particularly central Africa, which is going through enormous difficulties. The Administrator of the Territory has the big responsibility of ensuring that the interests of the natives are protected. That is the paramount consideration that he has in mind when making a decision as to what action should be taken. The interests of the natives are of paramount importance. That is the guiding principle that he had in mind when he came to his decision. I am sure that he was right. In this very difficult world, we cannot take great risks where the future of the natives of New Guinea and Papua are concerned. In making up his mind, the Administrator felt that this was not the time and place for a visit by somebody who would probably cause trouble among the natives.

The honorable member for Parkes (Mr. Haylen) is very glib in the use of terms such as “ McCarthyism “. Without bothering to check the facts, he made statements in this chamber which, if they had been made anywhere else, Would have constituted a slander on three people. He had the opportunity to make a check to see whether the people he named were rejected from the Territory, but he did not bother to avail himself of that opportunity. He used the word “ McCarthyism “. When told that his information is wrong, as he was the other night, he has not the common decency to admit that he has made a mistake and apologize to the people concerned. The greatest exhibition of McCarthyism can be seen in the actions of the honorable member for Parkes.

The honorable member for Yarra (Mr. Cairns) has claimed that purely because Professor Gluckman has distinctive academic qualifications - which no one denies - he should be permitted to go wherever he wants to go and should be permitted to do what he wishes. The honorable member has also claimed that because this gentle man has these academic qualifications and has been in certain parts of Africa, it would not be possible for him to create difficulties among the natives if he went to New Guinea.

Mr Ward:

– What sort of difficulties?


– You know better than any one the kind of difficulties to which I refer, because you associate with the people who create them. The argument of the honorable member for Yarra is completely illogical. No one denies that this man has distinctive academic qualifications. It was because of that fact that he came to the National University. He was given the right to go anywhere that he wanted to go in this country, without any one bothering to watch him in order to see what he did. But it would be a totally different matter to permit him to go to New Guinea and Papua, associate with the native peoples there and possibly be a source of difficulty so far as they are concerned .

Let me refer to another important point. This Government has not changed the security methods that were in force at the time the Chifley Government was in office. I know that the honorable member for Mackellar (Mr. Wentworth) is very anxious that information from the security service should be made public, but if that were done the sources of information would quickly dry up and gradually the security service would be compelled to fold up.

I want to emphasize once again that the Administrator has the responsibility of ensuring the welfare and the prosperity of the natives of New Guinea. The evidence that he had available to him was not merely of a security nature, and after considering it he came to the conclusion that it was in the best interests of the natives that this man should not be given a permit to go to New Guinea. I think that if any one is doing harm to the cause of Professor Gluckman it is the people on the Opposition benches. I have some doubts about their sincerity, because when the honorable member for Hindmarsh (Mr. Clyde Cameron) dealt with this issue, he did not do so on the basis of Professor Gluckman’s reputation and integrity. He tried to raise the question whether this gentleman would be collecting evidence to place before the Trusteeship Council of the United Nations. That possibility was never in our minds. Our record in New Guinea is a good one. The Prime Minister (Mr. Menzies) has commented on it in the most favorable terms.

Mr. Speaker, look at the giggling mass on the other side of the chamber, including the Deputy Leader of the Opposition (Mr. Whitlam) who was rebuked by his own leader for his statements when he was in New Guinea! We are proud of our record there, and so is the Leader of the Opposition (Mr. Calwell),

When our administration of the Territory comes before the Trusteeship Council for consideration, we are glad to let all the relevant information be known. We regard this as a sacred trust and we will carry out that trust to the limit of our ability. It does not do this house, the country or the natives themselves any good when a fictitious issue concerning the Trusteeship Council is raised by the honorable member for Hindmarsh when, ostensibly, he seeks to protect the name of a professor who wished to go to New Guinea and who was not given a permit to go there,

Thursday, 1 September 1960


– I support the concluding remarks of the Minister for Labour and National Service (Mr. McMahon).I think that the entrance of the honorable member for Hindmarsh (Mr. Clyde Cameron) into this debate was mischievous. He appointed himself judge, jury and trade union secretary, and a few other things besides. The Commonwealth Government, whether it be a Labour government or the present Government, has never had anything to hide from the Trusteeship Council with regard to our administration of New Guinea. If those remarks pass unchallenged some one will pick them up and say that they were not sufficiently replied to.

May I remind the honorable member for Hindmarsh that the Trusteeship Council itself regularly sends a visiting mission to those areas that are under its control, that the mission is there for a long time, that it has all the facts before it, and that they are all well known to it. Therefore, it ill becomes any member of this House - I do not care whether a Labour government or any other government is in office - with all this going to and fro, and with these inspections by officials appointed by the Trusteeship Council, to say that Australia has anything to hide in its administration of Papua and New Guinea. I think the statement of the honorable member for Hindmarsh was most deplorable.

With regard! to the main issue that has been raised, I can well understand the position of the Government, and I doubt whether it could change its attitude. I am sorry it did what it did; I believe it was wrong. I believe the mistake is made in inviting to this country at the taxpayer’s expense people who are security risks. The Government having made that mistake, and this man being the guest of this country, the best thing to have done would have been to give him a vise. I would have gone with him.

Question resolved in the affirmative.

House adjourned at 12.2 a.m. (Thursday).

page 662


The following answers to questions were circulated: -


Mr Cairns:

s asked the Treasurer, upon notice -

  1. What was the value of (a) concessional deductions for (i) spouses, &c, (ii) first children, &c, and (iii) other children, and (b) each type of concessional deduction per taxpayer, for each grade of actual income shown in the thirty-eighth report of the Commissioner of Taxation?
  2. What was the reduction of net tax paid caused by the allowance of each type of concessional deduction for (a) all resident individual taxpayers and (b) resident individual taxpayers in each grade of actual income shown in the report?
Mr Harold Holt:

– The answer to the honorable member’s question is as follows: -

A statement has been prepared and is set out below, showing for each type of concessional allowance for which information is available, the total amount allowed as a deduction in respect of returns of 1956-57 income. In this statement, “ Other Deductions “ includes amounts allowed not only for the other concessional deductions provided in sections 82a to 82j of the Assessment Act, but also for deductions such as subscriptions to business and professional associations and unions: one-third of calls paid to mining, prospecting or afforestation companies operating in Australia: gifts of £1 and upwards to public benevolent institutions, approved research institutes for scientific research, &C; zone and overseas forces allowances: living away from home allowances: rates and taxes for which the taxpayer is personally liable. Information is not available to show, either as a whole amount or in its dissected form, the amount that was allowed to each taxpayer entitled to a deduction. The amount which represents the average amount, spread over all taxpayers is obtained by dividing the total number of taxpayers or the total number of taxpayers in each grade of income into the total of the deductions or the total of the deductions allowed to taxpayers in that grade of income, as the case may oe, but as the result would be meaningless, it has not been done.

  1. Precise figures are not available but estimates of the reduction in tax payable due to the allowance of the concessional deductions mentioned are set out in the statement below: -
Mr Ward:

d asked the Treasurer, upon notice -

  1. Are company profits transferred to reserve taxable if later distributed in the form of bonus shares?
  2. If a new company is formed to take over an existing company, and it subsequently makes a distribution of its reserves by the issue of bonus shares, would this share capital be taxable?
Mr Harold Holt:

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

  1. Bonus shares are assessable income except where specifically exempted by the income tax law. Exemptions are authorized in respect of - (a) bonus shares issued in satisfaction of a dividend paid wholly and exclusively out of profits from the re-valuation of assets not acquired for re-sale at a profit or from the issue of shares at a premium (section 44 (2.) (b) (iii) of the Income Tax and Social Services Contribution Assessment Act 1936-60);

    1. bonus shares issued in satisfaction of dividends which, if paid in money, would be exempt from tax. Dividends are exempt when paid out of certain exempt mining profits (sections 44 (2.) (a), 44 (2.) (b) (i), 44 (2.) (c), 44 (2.) (d), 44(3.) and 44(4.)) or from profits derived by private companies up to the end of the 1946-47 income year and subjected to undistributed income tax (section 107).
  2. Bonus shares distributed by the new company out of its reserves would be taxable unless qualifying for exemption under one of the classifications mentioned in the answer to 1.

Mr Ward:

d asked the Treasurer, upon notice -

  1. What items of expenditure incurred by business executives and included in what is referred to as “ expense account “ are allowable deductions for taxation purposes?
  2. ls there any limit to the amount which may be claimed as a taxation deduction for any particular item of expenditure or to the total expenses which may be listed under this heading; if so, what are the details?
Mr Harold Holt:

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

  1. The income tax law authorizes a deduction for expenditure incurred in gaining or producing assessable income, or necessarily incurred in carrying on a business for the purpose of producing assessable income. The deductions do not, however, extend to expenditure of a capital, private, or domestic nature.
  2. The deductions allowable are limited to amounts that satisfy the tests set out in 1.
Mr Ward:

d asked the Treasurer, upon notice -

  1. Can he say whether the Nestle Company (Australia) Limited earlier this year made a bonus share issue of a face value of £1,250,000 by a revaluation of its assets?
  2. Are these bonus shares exempt from payment of taxation?
  3. If so, what is the reason for the continuation of a system whereby income of this description, obtained without any physical effort on the part of the recipient, is exempt from payment of taxation, whilst all wages and salaries earned from employment are taxable?
Mr Harold Holt:

– The answer to the honorable member’s questions is - 1 to 3. The only information available to me in relation to Nestle Company (Australia) Limited is that which has appeared in the press and I am not aware whether an issue of shares has in fact been made.

International Labour Conference

Mr Whitlam:

m asked the Minister for Labour and National Service, upon notice: -

  1. Did the Australian Government representatives support the conventions and recommendations adopted at the 44th (1960) Session of the International Labour Conference?
  2. What action is being taken for Australia to ratify the conventions and implement the recommendations?
  3. Was the Australian Government invited to appear before the Committee of Experts on the

Application of Conventions and Recommendations? If so, concerning what conventions and recommendations?

Mr McMahon:

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

  1. Yes.
  2. When the official texts are received, they will, in accordance with usual practice, be referred to the States and to the appropriate Commonwealth departments and authorities for their comments as to the possibility of ratification of the convention or acceptance of the recommendations by Australia.
  3. No.

Industrial Accidents

Mr Whitlam:

m asked the Minister for Labour and National Service, upon notice -

Can the Australian Stevedoring Industry Authority state the number of compensable injuries and fatalities which occurred in the stevedoring industry in the last year?

Mr McMahon:

– The answer to the honorable member’s question is as follows: -

It is regrettably a fact that as of the moment the statistics sought are not available. It is now widely known that my department has been actively concerned for some time to develop arrangements which will ensure that basic data in relation to industrial accidents will be available. A great many authorities. State and Commonwealth, are involved and while a high degree of cooperation has been forthcoming, it may still be some time before our objective is attained.

Royal Mint in Canberra.

Mr Beazley:

y asked the Treasurer, upon notice: -

  1. Does the Commonwealth Government intend to build a mint in Canberra; if so, what is the estimated cost?
  2. Is it intended to discontinue employing the branches of the Royal Mint in Melbourne and Perth for minting Commonwealth coinage; if so, what public interest is served by dismantling their plant and disbanding their skilled work force?
  3. What reasons would justify the building of a mint in Canberra, in priority of other public building projects, when two mints already exist in Australia?
Mr Harold Holt:

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

  1. The Commonwealth Government intends to build an Australian mint in Canberra. As plans are still at a very preliminary stage, no estimate is yet available of the probable cost of the new mint. 2 and 3. A major advantage which will result from building a mint in Canberra will be a considerable reduction in minting costs following- the introduction of modern large-scale methods of production. The two existing mint buildings in Melbourne and Perth were erected in 1872 and 1889 respectively and it would be impracticable to adapt them to enable the installation of the new equipment which is now a feature of modern mints overseas. The capacity of this new equipment is such that it would be quite uneconomical in the foreseeable future to have more than one centralized mint operating in Australia. For this reason, no further coinage orders will be placed in Melbourne or Perth once the Canberra Mint is fully in operation. However, as I have said several times in answer to previous questions, no gold refinery will be incorporated in the Canberra Mint, and its establishment will therefore not interfere with gold-refining operations at present being conducted in Melbourne and Perth. Employees at those mints, not required for future gold-refining operations, will of course be eligible to apply for positions at the Canberra Mint. The Government is making a diminishing profit on silver coinage, and an actual loss of significant proportions each year on bronze coinage. The whole question of the future size of Australian coins, and the alloys to be used in their production, is under review at present in the Treasury and will be considered by the Government in due course, particularly in relation to the recommendations of the Decimal Currency Committee. Whether or not a decimal currency is introduced into Australia, it is becoming inevitable that a vast number of existing coins will have to be replaced. The two existing mints would be neither capable of producing the new coinage at a cost acceptable to the Commonwealth Government, nor of doing so within a reasonable period of time. The Government therefore considers that it is now an appropriate time to prepare for the establishment of a new Australian mint, run in accordance with accepted standards of efficiency and economy, and capable of supplying Australia’s coinage needs for many years to come.

Loan Raising

Mr Ward:

d asked the Treasurer, upon notice -

  1. Is it a fact that earlier this year a £1,000,000 public loan flotation by the Victorian Gas and Fuel Corporation failed by 35 per cent, to reach its target, a Brisbane City Council loan of £800,000 was undersubscribed by £280,000. and a State Electricity Commission of Victoria loan of £2,100.000 finished with £261.000 left in the hands of the underwriters?
  2. Will a continuation of these loan failures create extreme difficulties for these semi-government and local governing authorities?
  3. Does the Government propose to take any action to assist these bodies to surmount their financial difficulties?
  4. Will these difficulties threaten the employment of many Australian workers and delay many essential works?
Mr Harold Holt:

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

  1. Yes. 2, 3 and 4. In each recent financial year, most semi-government and local authorities have succeeded in borrowing the full amount of their approved borrowing programmes for the year. Many authorities have claimed that they could have borrowed more, on currently approved terms and conditions, if additional approvals had been available. Indeed, the programmes originally approved for each of the last three financial years were increased during the year, by £3,000,000 in 1957-58 and by £4,000,000 in both 1958-59 and 1959-60, and the full amount of the addition was borrowed later in the year. As the public loans mentioned in question 1, together with all similar semi-government public loans, are fully underwritten, the borrower receives in each case the full amount of the loan, irrespective of the amount received from the public.


Mr Harold Holt:

t. - On 18th August, the honorable member for Werriwa (Mr. Whitlam) asked a question without notice regarding banking hours throughout the Commonwealth, which I undertook to examine.

I am now able to supply the following answer: -

The fixing of trading hours in industry and commerce is a matter which comes within the sphere of responsibility of the States and not of the Commonwealth. Moreover, so far as banks are particularly concerned, bank holidays in the various States have, for many years been governed by State legislation on the subject. I understand that the closing of banks on Saturday mornings in Tasmania, and more recently in South Australia, was made possible by the declaration of Saturday as a bank holiday under the respective State acts relating to bank holidays. It is true that section 68 of the Banking Act 1959 empowers the Commonwealth Treasurer to declare a bank holiday by public notification in the “Commonwealth Gazette “, but the purpose of this provision is solely to enable a bank holiday to be declared at short notice throughout Australia in the event of a national emergency which warranted closure of the banks on a particular day. Indeed, the wording of this provision was changed slightly in the 1959 legislation, as compared with the original provision enacted in 1953, to make it quite clear that the Commonwealth had no intention of usurping the States’ powers relating to bank holidays or bank trading hours generally.

Mutual Defence Pacts

Mr Ward:

d asked the Minister for External Affairs, upon notice -

  1. Is it a fact that under the terms of the Anzus or Seato Pacts, or of both of these agreements, Australia is committed to give active assistance to any of the other signatory nations in the event of their armed forces being attacked anywhere in the Pacific or in South-East Asian areas?
  2. If so, is it the practice for Australia to be fully advised and consulted by the signatory nations of these pacts before a final determination is made in respect of any matter, including the use of armed forces which could lead to the involvement of this country in war?
Mr Menzies:

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

  1. Australia’s obligations under the Anzus Treaty, in the event of an attack on the armed forces of signatory powers, are contained in Article IV.-

Each Party recognizes that an armed attack in the Pacific area on any of the Parties would be dangerous to its own peace and safety and declares that it would act to meet the common danger in accordance with its constitutional processes.

Article V. defines the phrase “ an armed attack on any of the parties “ -

For the purpose of Article IV. an armed attack on any of the Parties is deemed to include an armed attack on the metropolitan territory of any of the Parties or on the island territories under its jurisdiction in the Pacific or on its armed forces, public vessels or aircraft in the Pacific.

In the case of the South-East Asia Collective Defence Treaty, Australia’s obligations are defined in Article IV. (1)-

Each Party recognizes that aggression by means of armed attack in the Treaty Area against any of the Parties or against any State or territory which the Parties by unanimous agreement may hereafter designate, would endanger its own peace and safety, and agrees that it will in that event act to meet the common danger in accordance with its constitutional processes. Measures taken under this paragraph shall be immediately reported to the Security Council of the United Nations.

Article IV. further provides that in the event of threats, other than by armed attack, to the territorial integrity or independence of any member country or any designated State or territory, the parties “ shall consult immediately in order to agree on the measures which should be taken for the common defence “.

The “Treaty Area” is defined in Article VIII. as the general area of South-East Asia, including also the entire territories of the Asian member States, and the general area of the South-West Pacific, not including the Pacific area north of 21 degrees 30 minutes north latitude. In a protocol to the treaty, the States of Cambodia, Laos and the Republic of Vietnam were designated for the purposes of Article IV.

Article IV. (3) of the South-East Asia Collective Defence Treaty states -

It is understood that no action on the territory of any State designated by unanimous agreement under paragraph 1 of this Article or any territory so designated shall be taken except at the invitation or with the consent of the Government concerned.

  1. In the case of the Anzus Treaty, the practice of consultation is provided for in Articles III. and VII. Article III. reads-

The Parties will consult together whenever in the opinion of any of them the territorial integrity, political independence or security of any of the Parties is threatened in the Pacific.

Article VII. provides -

The Parties hereby establish a Council consisting of their Foreign Ministers or their Deputies to consider matters concerning the implementation of this Treaty. The Council shall be so organized as to be able to meet at any time.

The Anzus Council meets regularly, the last meeting being held in Washington in October, 1959. In the case of Seato, the practice of consultation is provided for in Articles IV., to which I have already referred, and V. Under Article V., the parties established a council to consider matters concerning the implementation of the treaty. The council, in the words of Article V., “shall provide for consultation with regard to military and any other planning as the situation obtaining in the treaty area may, from time to time, require. The council shall be so organized as to be able to meet at any time.” In addition to the annual meetings of the Seato Council, the council has established regular consultation at Seato head-quarters between the Council representatives, consisting of the Ambassadors of the Seato member countries in Bangkok, on matters of policy affecting the organization.


Mr Ward:

d asked the Prime Minister, upon notice -

  1. Does the practice of some private companies, having in effect a monopoly of the Australian market for the sale of their commodities, of increasing the price of their products to the local consumer as a means of raising finance to enable them to carry out plant expansion programmes meet with the approval of the Government?
  2. If not, does the Government intend taking any action to correct this position?
Mr Menzies:

– The answers to the honorable member’s questions are as follows: - 1 and 2. The honorable member is aware that the Government is considering various practices which could constitute a restraint of trade. The Government’s findings and its proposals for action will be announced at the appropriate time.

Conciliation and Arbitration

Mr Whitlam:

m asked the Attorney-General, upon notice -

In what matters in the last three years has he or his predecessors intervened before the Commonwealth Conciliation and Arbitration Commission?

Sir Garfield Barwick:

– The following is the answer to the honorable member’s question: -

  1. Each of the annual basic wage cases; (b) the Metal Trades case, 1959; and (c) the Public Servants case, 1959.


Mr Ward:

d asked the Prime Minister, upon notice -

  1. Has a report of the findings of a committee of educational authorities, presented to the New South Wales Government earlier this year, revealed alarming Australia-wide deficiencies in primary, secondary and technical educational facilities?
  2. Are the difficulties now being experienced in the field of education largely attributable to the too rapid intake of immigrants and the relatively slow expansion of educational facilities?
  3. Is the lack of schools and teaching staff attributable to an inadequacy of finance available to State Governments for this purpose?
  4. If so, can the position be satisfactorily met only by immediate action by the Commonwealth Government to provide substantially increased financial advances to the States, or by a reduction in the migrant intake?
  5. Does the Government propose to take either of these courses?
  6. If not, will the position deteriorate still further, and is it intended that this will be allowed to happen?
Mr Menzies:

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

  1. The honorable member’s question is based on a report which has not been brought to my attention. If a report of this nature is referred to the Commonwealth Government it will be studied carefully. 2 to 6. I refer the honorable gentleman to the answer I gave to a similar question of his in “Hansard” of 25th August, 1959.

Australian Forces In Malaya.

Mr Menzies:

s. - On 16th August, the honorable member for Werriwa (Mr. Whitlam) asked the Minister for External Affairs the following question without notice -

Now that the Government of Malaya has declared the Emergency there at an end and since Malaya is not a party to or covered by Seato, will he say what formal arrangements exist between Malaya and Australia concerning the Australian land and air forces based in Malaya?

I undertook to have the precise facts prepared and, to this end, treat the honorable member’s question as being on the noticepaper.

The following information is supplied: -

The facts are that after Malaya became an independent member of the Commonwealth, an Agreement on External Defence and Mutual Assistance was concluded on 12th October, 1957, between the Governments of the Federation of Malaya and the United Kingdom. Article III. of this Agreement affords to the Government of the United Kingdom the right to maintain in the Federation such forces, including a Commonwealth Strategic Reserve, as the two Governments agree to be necessary to assist the Federation of Malaya in its external defence and for the fulfilment of Commonwealth and international obligations. The Australian land and air forces based in Malaya form part of the Commonwealth Strategic Reserve: and the Australian Government, although not a party to the Defence Agreement itself, has exchanged letters with the Malayan Government to associate itself formally with those provisions of the Agreement which are applicable to the Commonwealth Strategic Reserve.

The termination of the Emergency and the promulgation of new Malayan legislation has not changed this situation. On 1st August, 1960, an Internal Security Act came into force which empowers the Malayan Government to deal with the risks to internal security presented by the threat of subversion, particularly in border areas of the Federation, which have been proclaimed as border security areas under the Act, where operations against the terrorists continue. An order under the Malayan Visiting Forces Act 1960 provides in effect for the Commonwealth forces in Malaya, including the Australian forces, to assist in operations against the terrorists in such border security areas.

Speaking on the second reading of the Internal Security Bill in the Malayan House of Representatives on 21st June, 1960, the Deputy Prime Minister of Malaya, Tun Abdul Razak bin Hussein, said: -

Within the border security area the Federation Government will continue to have the assistance of the Commonwealth Land and Air Forces . . . The Commonwealth Governments concerned have expressed their readiness to make forces available as may be required.


Mr Whitlam:

m asked the Prime Minister, upon notice -

What amounts (a) are available and (b) have so far been paid to each University under the States Grants (Universities) Act 1958?

Mr Menzies:

– The answer to the honorable member’s question is as follows: -

The following tables set out the amounts available under the States Grants (Universities) Act 1958 and the amounts paid to each university up to 30th June, I960:-

Mr Whitlam:

m asked the Prime Minister, upon notice -

  1. How many new students were enrolled at each university last year and this year?
  2. How many Commonwealth scholars were enrolled in the first year of their course at each university last year and this year?
Mr Menzies:

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

  1. Details of 1960 university enrolments are not yet available, but the 1959 figures for new enrolments in bachelor degree courses and for total new enrolments at Australian universities, excluding the Australian National University, were as follows: -
  2. The number of Commonwealth scholars in the first year of their course, as at 30th September. 1959, was 2,733. They were distributed amongst the various universities, as follows: -

The figures for 1960 are not yet available.

Commonwealth Scholarships

Mr Whitlam:

m asked the Prime Minister, upon notice -

  1. How many (a) full-time and (b) part-time scholars hold Commonwealth scholarships?
  2. How many full-time scholars are receiving (a) no living allowance, (b) part living allowances and (c) full living allowances?
  3. What will be the cost in 1960 of (a) scholarships and (b) allowances?
Mr Menzies:

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

  1. The Commonwealth Scholarship Scheme is administered by the States, and each year State education departments provide the statistics which give information of this nature as at 30th September; the exact 1960 figures, therefore, are not yet known. As at 30th September, 1959, there were 9,316 full-time and 1,940 part-time Commonwealth scholars in training. This year it is estimated that there are 12,000 scholars in training and, of these, something of the order of 80 per cent, are enrolled in full-time courses.
  2. The 1959 figures were (a) 5,571, (b) 2,300 and (c) 1,445.
  3. In 1959, the fees of Commonwealth scholars cost £994,938 and living allowances £790,120. Estimated costs of these items in 1960 are £1.229.000 and £869.000, respectively.

Pollution of the Sea by Oil.

Mr Whitlam:

m asked the Minister for External Affairs, upon notice -

What countries signed but have not yet ratified the International Convention for the Prevention of the Pollution of the Sea by Oil, 1954?

Mr Menzies:

– The answer to the honorable member’s question is as follows: -

Twenty countries signed the International Convention for the Prevention of Pollution of the Sea by Oil. Of these Ceylon, Greece, Italy, Japan, Liberia, New Zealand, the Soviet Union and Yugoslavia have not yet accepted the Convention, according to the latest available information.

Company Profits

Mr Ward:

d asked the Prime Minister, upon notice -

  1. Have the visible reserves of the Colonial Sugar Refining Company Limited risen from £6,000,000 to £26,400,000 in a period of three years?
  2. Did this company report a profit rise of £343,000 for last year’s operations, and has its profit doubled in the last six years?
  3. If so, what is the justification for a recent increase of ld. per lb. in the retail price of sugar which will cost the Australian consumers £4,000,000?
Mr Menzies:

– The answers to the honorable member’s questions are as follows: - 1, 2 and 3. These questions concern the financial position of a particular company with wide interests. The Commonwealth and Queensland Governments accepted the case of the sugar industry for an increase in the wholesale price of sugar which had not been changed since 1956. The Colonial Sugar Refining Company Limited will benefit only in its relatively small capacity as a producer of raw sugar, not in its major activity as a sugar refiner.

Mr Ward:

d asked the Prime Minister, upon notice -

  1. Has his attention been drawn to the bid by the oil firm trading as H. C. Sleigh Limited to take over the Adelaide Steamship Company Limited by offering to pay 82s. for each share which at the time was being quoted around 27s. on Australian stock exchanges?
  2. Did the directors of the Adelaide Steamship Company Limited immediately advise its shareholders that the future dividend made would be 15 per cent, instead of the 5 per cent, rate which then prevailed?
  3. Is it a fact that for a period of approximately 40 years the dividend paid by the Adelaide Steamship Company Limited had averaged about 5 per cent, and that, during this time the declared profit never exceeded the amount required to meet the dividend payments in any year by more than a few hundred pounds?
  4. Is it a fact that the new dividend rate of 15 per cent, will absorb just on £349,000 per annum whereas the highest declared profit of the Adelaide Steamship Company Limited in the last 30 years was £163,000?
  5. If the position is as staled, does it indicate that the Adelaide Steamship Company Limited lias undoubtedly been issuing balance-sheets and financial statements .which did not disclose its true financial position, and that this situation was only revealed because of the directors’ anxiety to defeat the take-over move by H. C. Sleigh Limited.
  6. If so, will he state whether any consideration has been given by the Government to a course of action designed to prevent a continuance of such suspect practices?
Mr Menzies:

– The answers to the honorable member’s questions are as follows: - 1 to 6. The questions raised by the honorable member concern the financial activities of individual companies and as such are not matters about which the Commonwealth Government has any special knowledge.

Cite as: Australia, House of Representatives, Debates, 31 August 1960, viewed 22 October 2017, <>.