House of Representatives
28 October 1963

24th Parliament · 1st Session

  1. House of Representatives
  2. 24th Parliament
  3. 1963

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

page 2303

QUESTION

ROYAL AUSTRALIAN AIR FORCE

Mr PETERS:
SCULLIN, VICTORIA

– I ask the Prime Minister a question. The right honorable gentleman, in his statement last Thursday evening, said, “. . . two squadrons of B-47E aircraft will be made available to Australia “. Will the Prime Minister clarify that statement? Was he referring merely to an offer by the United States Government which the Australian Government has accepted or might accept? If the Government has accepted the offer, when will the B-47E bombers be operational with the Royal Australian Air Force?

Sir ROBERT MENZIES:
Prime Minister · KOOYONG, VICTORIA · LP

– The position is that the United States Government has said, “ If you find it desirable to have something alongside the Canberra pending the arrival of the TFX, then these B-47E’s are available “. They are available without rental and on certain terms which are, in fact, extremely good. Whether we will take these B-47E’s, and when, depend entirely on the judgment of the Royal Australian Air Force from time to time. If our Air Force says at a certain stage that it would be a good thing to have a squadron of these B-47E’s, we will have them. There is no uncertainty about our right to receive them; but the time when we receive them, and the circumstances under which we receive them, are obviously matters for the R.A.A.F. authorities to determine. So, we are in the fortunate position of being able to get them as and when we want them. It may very well be, having regard to the accelerated date of delivery of the TFX, that we may not need them, because after all the Canberra is not entirely broken-winded yet - far from it. Therefore, it may be that we will not need the B-47E; but if we do, there it is and we can get it on the terms indicated.

Mr HOWSON:
FAWKNER, VICTORIA

– I also direct to the Prime Minister a question concerning the purchase of the TFX bombers. I ask the i light honorable’ gentleman whether there is any truth in the allegation by the Leader of the Opposition that he, the Prime Minister, had let it be known that he favoured the British machine and that he had not kept the United Kingdom Government informed of the true decisions about this matter on all relevant occasions.

Sir ROBERT MENZIES:

- Mr. Speaker, one lives and learns. I understand from what the honorable member has said and from something that I have read in the press that I am supposed to have said that I wanted the TSR-2 and presumably other people did not. That, of course, is quite untrue. We, of course, as a government, are always anxious to do what we can in relation to British aircraft. So we begin with that in our minds. But under the circumstances, particularly in view of the report from our colleague, the Minister for Defence, from the United States, no government could have refused the offer that was made. I am sorry to find that my distinguished friend apparently has been quoting something said on behalf of the United Kingdom High Commissioner. My experience has been that when the High Commissioner for the United Kingdom has something to say he says it to me. This is quite right. In other words, neither he nor I lives on gossip or on gossip columns.

The fact is, and perhaps this ought to be made perfectly clear, that my colleague, being in America, conveyed to us by cable the nature of the offer which he had been able to negotiate with Mr. McNamara, Secretary of Defence of the United States of America - a very handsome offer. We had some questions to which we wanted answers about certain points of detail. So we cabled to our colleague, “ We are interested in this, but would you please find out about A, B and C”. At this stage some person lacking in elementary honour obviously conveyed to the press the content or the substance of the cable from my colleague. It appeared in the press. This was to me immensely embarrassing, because I had been in personal correspondence or in cable communication with the Prime Minister of the United Kingdom, who had made certain proposals. I knew that it was my first duty to tell him about such decisions as we, might make contrary to his own proposals. That cable was to go, but before it could actually go I read of this in the press. Stolen goods - and receivers of stolen goods!

Mr Cairns:

– Not much to be proud of.

Sir ROBERT MENZIES:

– It is perfectly clear that there is not much to be proud of. You do not think I am the detective, do you?

Mr Curtin:

– You look like one.

Sir ROBERT MENZIES:

– On the contrary, I look like a commissioner of police. Honorable members opposite have great ambitions for the first time.

Mr Calwell:

– Great expectations!

Sir ROBERT MENZIES:

– Yes, great expectations. A week ago they were in “ Bleak House “. Now they are in “ Great Expectations “. Honorable members opposite need not laugh too soon about things becoming known. All I know is that I found myself tremendously embarrassed because the contents of a confidential message from my colleague had become disclosed. I at once sent word to the Prime Minister of the United Kingdom telling him, not in curt terms but in full detail, what the arrangement was and why we were accepting it. This I regard as an obligation of courtesy between the heads of two governments. Several hours later we received the reply from the Minister for Defence. On the strength of that reply, and the matter being concluded, I made my announcement to the House. Really, Mr. Speaker, the idea that this can be made a cheap occasion for saying that I have been discourteous to my United Kingdom colleague is utterly contemptible. I hope what I have said will clarify this matter in the public mind.

page 2304

QUESTION

MALAYSIA

Mr CALWELL:

– 1 desire to ask the Prime Minister the following questions: - Was a treaty on external affairs and mutual assistance made between the United Kingdom and the Federation of Malaya on 12th October, 1957? Was a further treaty between the United Kingdom and the Federation of Malaysia, applying the treaty of 1.2th October, 1957 to Malaysia? made on 9th July, 1963? Does that treaty give to the United Kingdom rights to bases and alternative bases in Malaysia for the purpose of assisting in the defence of Malaysia and Commonwealth defence and for the preservation of peace in South-East Asia? Does Malaysia, under the treaty, enter into an obligation to co-operate with the United Kingdom for the purpose of effective action if any of the protectorates or territories or forces of the United Kingdom in the Far East are attacked or threatened? If so, can the treaty be described as one of mutual defence? Does Malaysia claim to be an unalined country like India? If so, how can such a claim be justified in view of Malaysia’s treaty obligations to the United Kingdom?

Sir ROBERT MENZIES:
LP

– I am fascinated by the way in which the Leader of the Opposition affects an air of surprise. May I remind him that 1 tabled these documents in the House quite some time ago?

Mr Cairns:

– Obviously you did not read them.

Sir ROBERT MENZIES:

– Of course, I could never compete with the honorable member for Yarra. However, I tabled these documents in the House. They contained all the information that was needed on these points. I also pointed out in the House, in making my statement on Malaysia, the very sharp distinction between the position of Australia, which was not the colonial power, and Great Britain, which was. Great Britain was the colonial power in relation to Malaysia. It was Great Britain which, by steady degrees, in a process in which, as the honorable member will recall, a representative contributed by us gave assistance, worked out a constitu-tion for an independent and free Malaya,, now an independent and free Malaysia. Following a very good practice, the United Kingdom said, in effect and by agreement, to Malaya first and now Malaysia: “ We are giving you your independence. We want you to have it. We will therefore undertake obligations to see that it is protected.” Therefore they made a defence agreement, all of the terms of which I tabled weeks ago in this House, and which are now being exhumed, apparently, and twisted a little for the purpose of electioneering. Australia was never the colonial, power. Australia respects the Malaysian desire to be an unaligned country. So long as it is an unaligned country it is not going to make military alliances with mutual obligations with countries that were not the colonial power. I hope this is perfectly clear.

Mr Cairns:

– It is not.

Sir ROBERT MENZIES:

– It ought to be clear. You would not understand it, anyway, because you are not interested in this kind of thing. May I repeat, then, that the moment a country enters into military alliances with other countries from which its independence does not derive, as is the case in relation to Malaysia and the United Kingdom, then it ceases to be an unaligned country? Isn’t that elementary?

Mr Cairns:

– Is this one of your rules?

Sir ROBERT MENZIES:

– This is one of the rules that exist in the world, and when the honorable member for Yarra knows a little more about the world he will understand it perfectly.

Mr Curtin:

– You are a bit rattled to-day.

Sir ROBERT MENZIES:

– Am I? Whenever I look at you I can hear the rattle. I never felt better. But, Sir, if I may come book to the question, in case honorable members opposite are interested in it, I point out to them and I would be very happy to have them deny on the platform that this is so that when one nation enters into a military obligation with another and another and another, as nations have done in the SouthEast Asia Treaty Organization, then it ceases to be unaligned. I would like honorable members to bear in mind that if Malaya had not wanted to be and had not insisted upon being unaligned, then it no doubt would have become a party to Scato. But it did not do so. Now explain that to the denizens of Richmond.

page 2305

QUESTION

TELECOMMUNICATIONS

Mr WHITTORN:
BALACLAVA, VICTORIA

– Can the Minister for

Supply say, generally, what is the state of development of satellite communications? What is being done in Australia to assist in related research and development?

Mr FAIRHALL:
Minister for Supply · PATERSON, NEW SOUTH WALES · LP

– I think the honorable gentleman will recall that an enormous amount of workhas been done on com munications satellites. This work has been done or led particularly by the United States of America, which, for a considerable period, has used both passive satellites of the Echo type and active satellites of the Telstar type, and is to use another series now being developed. At the same time, quite a number of European countries have commenced space research and rocket development of their own, no doubt towards the same end.

The most significant development that has come out of Europe, of course, is the formation of the European Launcher Development Organization, which has been formed by a group of European countries that have got together to develop satellites for peaceful purposes. No doubt, one of the peaceful purposes will be communications. This Eldo programme is the one in which Austra lia is a member, for the first five-year programme, without membership fee. Indeed, we are contributing our facilities and experience at Woomera as our fee for the first five-year programme. This entitles the Australian Government to full access to all technical information and to share equally with the European partners in the use of whatever satellite system is developed. So we are, as it were, in on the ground floor in whatever European programme of satellite communications is developed.

Whether this will wind up as a European scheme for satellite communications or whether* it will strengthen the hands of the Europeans in their later negotiations with the United States is not as yet clear, but our own position is particularly strong. At the same time, in this field, it is pretty certain that within the next decade there will be an enormous shift or, if not a shift, an enormous increment in international communications by satellites, not to the exclusion of cable services, but by way of supplementing cable capacity. There have been quite a number of international conferences in the last twelve months, particularly in the United Kingdom, and we have had our officers in attendance at all these conferences.

page 2305

QUESTION

ROYAL AUSTRALIAN AIR FORCE

Mr BRYANT:
WILLS, VICTORIA

– I address my question to the Prime Minister. A few moments ago, he said, in respect of new aircraft, that negotiations in the United States of America by the Minister for Defence had given Australia much better terms than Britain could give. Why does he negotiate with the United States through a senior Minister and with Britain by letter? How does he know that Britain could not match the offer of the United States? Are the right honorable gentleman’s relationships with the United States closer than his relationships with Britain?

Sir ROBERT MENZIES:
LP

-I am grateful to the honorable member for his question. As he well knows, I am personally well known to and friendly with the heads of government in Great Britain. I had - by letter and by cable, it is true - communications with Mr. Harold Macmillan. He sent out to Australia his Minister for Air, with whom we had discussions. Perhaps t the honorable member has overlooked that fact. As a result of these negotiations, both by letter and-

Mr Bryant:

– That-

Sir ROBERT MENZIES:

– Does not the honorable member want to hear the answer? If he does not, the matter will be quite simple for me.

Mr Bryant:

– But-

Mr SPEAKER:

– Order! The honorable member has asked his question.

Sir ROBERT MENZIES:

– The honorable member complained that he did not know that the United Kingdom Minister for Air was out here. What a pity! I thought it was very well known that the United Kingdom Minister was interviewed and that he saw us. The United Kingdom was admittedly very keen - and properly very keen - to have the TSR-2 adopted, and we finally knew what the financial terms would be and what the delivery dates would be for that aircraft, which, let mc remind honorable members, is as much still on the drawing board as the TFX is. A prototype of each has still to fly.

When my colleague went to the United States of America, he went knowing what these proposals were. He had with him, of course, the report made by our own evaluation team under the Chief of the Air Staff. All I want to say is that the. proposals which the Minister for Defence obtained and which we have accepted were equal in all things, at least in point of timetable, to what had been offered in relation to the TSR-2, and immeasurably more advantageous in terms of payment. I am not at the moment at liberty to give a precise figure, although I will discuss it with my colleague when he returns here on Wednesday afternoon. All I can say is that if any honorable member on either side of this House had put before him a proposition, arising from the mass production techniques in the United States, so immeasurably favorable to the taxpayers in terms of pounds, shillings and pence, he could not have rejected it. That is where we stand.

page 2306

QUESTION

EDUCATION

Mr FORBES:
BARKER, SOUTH AUSTRALIA

– My question is addressed to the Prime Minister. Is it a fact that the Robbins committee, which recently reported on higher education in the United Kingdom, is roughly equivalent to our committee on tertiary education which is due to report at the end of this year? If this is a fact, is not the attempt of the Leader of the Opposition in his television programme to use the Robbins committee to justify Labour’s education proposals an attempt to deceive the electors?

Sir ROBERT MENZIES:
LP

– Although the terms of reference of the Robbins committee in the United Kingdom differ in form from the terms of reference given to our committee on tertiary education they are the same in substance. The Robbins committee has only just made its report. As a matter of fact, a copy of it arrived on my table this morning for the first time, and naturally I have not had an opportunity to peruse it. Our committee, which is equally strong and authoritative, has been sitting for a long time. I have been pressing for a report. On the last occasion I spoke in the House on this matter I said that we were promised the report by the end of the year.

Mr Cairns:

– Perhaps you did not tell the committee-

Sir ROBERT MENZIES:

– The honorable member must not judge others by his own deplorable standards. Every sensible, decent person knows that I appointed this committee on tertiary education because I wanted some authoritative views on postsecondary education, including technological training and teacher training. These matters have very properly agitated the minds of a great many people. The committee’s report will be delivered at the end of the year. I will read it with great interest. If I am still Prime Minister I will read it with some sense of authority and make recommendations. But I will not anticipate what may be in it. That, I think, would be an offensive attitude to adopt towards a committee that has been established in this way.

page 2307

QUESTION

DEFENCE

Mr DALY:
GRAYNDLER, NEW SOUTH WALES

– I address my question to the Minister representing the Acting Minister for Defence. I refer to the publication “Defence Report 1963” presented to the Parliament a few days ago on behalf of the Minister for Defence. Is the Minister able to provide details of the cost of compilation and printing of this expensively illustrated document, which contains 64 pages? Was it authorized by the Treasury Publications Committee? Will the Minister state the persons and organization to whom it was circulated and whether all foreign embassies in Australia have been included in the distribution list? Has a similar publication ever been produced previously? If not, is it merely a happy coincidence that this publication is available on the eve of a federal election, or is it intended for distribution as electoral propaganda printed at the expense of the Australian taxpayer?

Mr FAIRHALL:
LP

– I can say only that, even if the report were a little expensive to produce, apparently it was very necessary at this stage to bring home to the Opposition in this Parliament the state of Australia’s defence preparedness. I will refer the rest of the question to my colleague in another place.

page 2307

QUESTION

TRADE

Mr TURNBULL:
MALLEE, VICTORIA

– 1 ask the Minister for Trade a question. As the matter is of paramount importance to Australia, will he ascertain from the Leader of the Opposition whether his party now approves of the Australian-Japanese Trade Agreement or whether, as previously stated, Labour in government would rescind it?

Mr McEWEN:
Minister for Trade · MURRAY, VICTORIA · CP

– I think it is hardly competent for me to ascertain that from the Leader of the Opposition.

Mr Turnbull:

– But it is of great importance to Australia.

Mr McEWEN:

– Of course it is. To the best of my knowledge, the last official declaration by a spokesman for the Australian Labour Party was that if returned to power Labour would rescind the Japanese trade treaty. I think all who are interested would expect the Leader of the Opposition to make this position clear in his policy speech.

page 2307

QUESTION

ROYAL AUSTRALIAN AIR FORCE

Mr CURTIN:

– I direct a question to the Prime Minister. In his statement last Thursday evening, he said that Australia had been offered the lease of two squadrons of B-47E aircraft from the United States of America. Under the terms of the. proposed lease, are there any restrictions which would in any way limit the use to which the Royal Australian Air Force could put these aircraft?

Sir ROBERT MENZIES:
LP

– The answer is, “ No, Sir “.

page 2307

QUESTION

SHIPPING

Mr FALKINDER:
FRANKLIN, TASMANIA

– I wish to ask the Minister for Shipping and Transport a question. Has his attention been directed to prominent statements in Tasmania suggesting that when the Sydney-Hobart ferry starts operating next year the number of trips it will make to Hobart will be restricted? Can he say quite positively that the original agreement will be adhered to, that is, that the “ Empress of Australia “ will make three trips per month to Hobart and three trips to Bell Bay? Also, can he say whether there is any hold-up in the signing of the Hobart terminal lease, which is said to be prepared, and so scotch these rumours?

Mr OPPERMAN:
Minister for Shipping and Transport · CORIO, VICTORIA · LP

– I have not seen the report but I have followed the honorable member’s question closely. I know that the itinerary for the “ Empress of Australia “ is under examination. The vessel will not be launched until next January and we hope that it will be in service about July or August. The itinerary, which has not yet been decided, must depend upon’: the amount of cargo offering and the service from other shipping as well.

I appreciate the honorable member’s interest in this matter, because he has been associated with this project for a considerable time. I can assure him that the Marine Board’s inquiries, and the discussions with it, arc going ahead quite amicably. There is an amount of detail to be cleared up, but at this stage there is nothing definite regarding the final itinerary. The addition of the “ Empress of Australia “ to the Tasmanian shipping service will be just another indication of the consideration that has been shown to Tasmania by the Australian National Line. The honorable member can be assured that the service to be given in the future will maintain the high standard set in the past.

page 2308

ROYAL AUSTRALIAN AIR FORCE

Mfr. BEATON. - I direct a question to the Prime Minister. I, also, refer to the negotiations with the United States of America resulting in the prospective purchase of the TFX bomber. Recalling his statements that “ no one could refuse the offer “ and, again, that it is “ a very handsome offer “, I ask: Was this, then, a firm offer in relation to price and delivery and, if so, when will this Parliament and the people know to what expenditure Australia is now committed? Did the Chief of the Air Staff, Sir Valston Hancock, in the course of his recent aircraft evaluation mission overseas, examine the B-47E aircraft, which is to be made available to Australia as an interim bomber replacement? If so, what was the nature of his advice on this aircraft?

Sir ROBERT MENZIES:
LP

– I have pointed out, both here and outside the House, that I am not at present at liberty to quote exact figures.

Mr Daly:

– When will we know?

Sir ROBERT MENZIES:

– I am hoping that I will be in a position to give that information when my colleague returns to Australia; and he returns on Wednesday. After all, you must remember that he has been negotiating this deal and it may well be that lor some reason or other it is not thought wise to announce the precise figure. All f know, is that the figure is very much lower than the amount, which 1 gather the

Leader of the Opposition would have wished to pay, because, sight unseen, he appears to have come down on the side of the TSR-2. That is very surprising. I repeat: All I know is that the cost to the taxpayers of this country of the F-111 A will be immensely less than the cost of the TSR-2. As soon as my colleague returns I will go into the matter with him to see to what extent precise details may be made available.

Mr Beaton:

– What about the B-47E?

Sir ROBERT MENZIES:

– The B-47E has been made available to us if we desire it. Nobody claims that the B-47E is tfe long-range answer to our problem. Of course it is not. In view of the fact that the time-table for production of the TFX or F-l 1 1 A has been shortened by at least eighteen months - this is one of the interesting things about this matter - the intervening period before this aircraft is available is correspondingly shortened. It may be that the Canberra will see us through. Some experts think that it will. If, however, we find it is desirable to have the B-47E, all I can say to the honorable member is that the B-47E is somewhat faster, has a much longer range and has a greater weapon-carrying capacity, than the Canberra. Also, it is likely to be in use by the United States in the western Pacific for at least the next four years.

page 2308

QUESTION

UNITED STATES NAVAL COMMUNICATION STATION IN AUSTRALIA

Mr CHANEY:
PERTH, WESTERN AUSTRALIA

– As the Minister for Labour and National Service is well aware, a ceremony is taking place to-day at North West Cape to mark the commencement of construction there of the very low frequency communication station. I ask the Minister: Has the Commonwealth any powers under the Defence Act or other acts which it may use to ensure that construction of the station shall proceed according to schedule?

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

– 1 have already informed the House that negotiations are proceeding between the unions and the Employers Federation of Western Australia with a view to completing an industrial agreement relating to the construction of the station at North West Cape. The latest information to hand is that those negotiations are proceeding satisfactorily - at least so far as the employers* representatives are concerned. I have not heard anything from the trade union representatives. Work is proceeding on the site. The information that I received as late as Friday last is that the negotiations are proceeding satisfactorily. There is no doubt that if any attempt is made by any groups of people to frustrate the agreement or to stop construction proceeding according to schedule, the Commonwealth has power under one of the defence acts to deal with the problem. The short answer to the honorable gentleman’s question is that negotiations are proceeding; if, after negotiations have concluded, unnecessary and unlawful holdups take place, the provisions of one of the defence nets may be invoked.

page 2309

QUESTION

ROYAL AUSTRALIAN AIR FORCE

Mr NELSON:
NORTHERN TERRITORY, NORTHERN TERRITORY

– Does the Minister for Air know that there is concern among wives of members of No. 5 Airfield Construction Squadron, which is at present stationed in Darwin, at the prospects of being parted from their husbands, who will be transferred to Katherine to construct the Tindal airstrip near that town? Is there any accommodation for married servicemen at that centre? If not, will the Minister take steps to provide the necessary accommodation so that airmen may have the companionship of their wives and families while the work is in progress?

Mr FAIRBAIRN:
Minister for Air · FARRER, NEW SOUTH WALES · LP

– I understand that the wives and families of members of 5 A.C.S. will remain at Darwin in their present accommodation and that the men will work continuously, probably for three weeks, and then will receive a week’s leave. This will enable them to rejoin their families in Darwin. We are hoping to negotiate with the Northern Territory Administration the erection of some houses in Katherine which could be used by the families of members of 5 A.C.S. and later be turned over to the Administration, but so far no agreement has been reached. I understand also that some members of the squadron may be able to use trailers as accommodation for their families in Katherine but, as I have said, for the present the majority of the families will remain in Darwin. For this reason members of the squadron will be given as much leave as is possible to enable them to rejoin their families.

page 2309

QUESTION

PAPUA AND NEW GUINEA

Mr COCKLE:
WARRINGAH, NEW SOUTH WALES

– Has the Minister for Territories seen a statement, allegedly emanating from a Wewak source, charging him with attempting to undermine the morals of the field staff of the Department of Native Affairs by telling young officers manning remote posts in the areas near the boundary of West Irian that their department was finished and that they should transfer to some other department? Is there any truth in this statement?

Mr HASLUCK:
Minister for Territories · CURTIN, WESTERN AUSTRALIA · LP

– The greater truth is that there has been a typographical error. I think the allegation was that I was trying to undermine the “ morale “ of the officers. I plead not guilty to both charges. The statement was contained in a letter addressed to the editor of a Sydney newspaper. The letter was anonymous, which leaves it open to suspicion, and false in practically every detail. It is hard to conceive of a Minister, however incompetent he may be in his job, deliberately setting out to undermine the morale of the service. I certainly did not attempt to do anything of the kind. As the letter was anonymous and appeared in a single newspaper I propose to seek the permission of the editor to reply to it at the same length and in the same place.

page 2309

QUESTION

ROYAL AUSTRALIAN AIR FORCE

Mr JAMES:
HUNTER, NEW SOUTH WALES

– I preface my question to the Minister for Air by asking him whether he recalls making the following statement in the House: -

I must say quite bluntly that although I disagreed with the Government’s policy on aircraft buying before I went abroad, I have come back disagreeing with it even more strongly.

Mr Daly:

– Who said that?

Mr JAMES:

– The Minister for Air said that in 1959.

Mr Bury:

– Docs this not refer to civil aircraft?

Mr JAMES:

– Yes. The Minister went on -

Every one of four decisions-

They were decisions affecting the purchase of aircraft by Australia - was made at the expense of British aircraft and in favour of American aircraft. K> .<

Have the Minister’s views changed, or was his advice on the purchase of a new American bomber for the Royal Australian Air Force rejected?

Mr FAIRBAIRN:
LP

– As my predecessor in office pointed out by way of interjection, the remarks that I made on the occasion to which the honorable member has referred concerned the purchase of civil, not military, aircraft. My views have not changed at all. 1 have always held the view that if British and foreign aircraft available to Australia are identical, or almost identical, we should buy the British product, lt is only when a particular aircraft which is available is far superior to others, as is the TFX, that I think we certainly should take the superior aircraft.

page 2310

QUESTION

EGGS

Mr TURNBULL:

– I direct my question to the Minister for Primary Industry. Has the plan for the stabilization of the Australian egg industry, as approved by the Commonwealth Government, now been approved by the State governments concerned? If so, will a poll of eligible producers be held? If not, what procedure will bc adopted to implement the plan?

Mr ADERMANN:
Minister for Primary Industry · FISHER, QUEENSLAND · CP

– The Council of Egg Marketing Authorities, which had the support of the State governments in general, approached the Commonwealth on the matter of co-ordination of activities. The Government decided at that stage to refer the matter back to the State governments for final approval of the proposals, which were to be sent to them in the form of a bill. Actually, f do not know whether copies of the bill have gone forward or even whether we have had a chance to get the measure drafted. However, copies of the bill will be submitted to the State Ministers for Agriculture and at that stage will receive the Ministers’ approval or otherwise. I expect approval from all of the States. If that is obtained, the Commonwealth Government will agree to the implementation of the proposals.

page 2310

QUESTION

ROYAL AUSTRALIAN AIR FORCE

Mr BEAZLEY:
FREMANTLE, WESTERN AUSTRALIA

– I ask the Prime Minister a question. Was his answer to an earlier question intended to indicate dishonorable guessing by a newspaper at the text of cables or an actual leakage of the text of cables? If the latter, was the leakage in the cable service, the Department of Defence, or anywhere else? What action is being taken?

Sir ROBERT MENZIES:
LP

– I do not think it was a guess. I wish I knew how it happened. The honorable member will understand that these things are not very easy to discover. I do not want this matter to go off on a side-line. 1 would much sooner that this House discussed it on ils merits. I have endeavoured to contribute to those to-day.

page 2310

QUESTION

DEFENCE

Mr KILLEN:
MORETON, QUEENSLAND

– I address a question to the Prime Minister. Has any evaluation been made by service chiefs of the proposal that the Australian armed forces should be maintained specifically as a peace unit of the United Nations? If an evaluation has been made, is there public access to it? To give a little perspective to the question, I simply add that this absurd proposal was the only reference to defence made by the Opposition in its speakers’ notes for the last election.

Sir ROBERT MENZIES:
LP

– I am not acting for the Minister for Defence, although some questions on defence have come my way to-day. I can assure the honorable member that the military advisers to the Government have all their work cut out to discuss practical proposals instead of engaging in speculation about remote and theoretical ones.

page 2310

QUESTION

COMMONWEALTH CENTRE, SYDNEY

Mr COSTA:
BANKS, NEW SOUTH WALES

– I ask the Prime Minister a question. He will remember that recently he officially opened the Commonwealth Centre in Sydney. I recollect that on that occasion he gave great praise to Commonwealth public servants for their loyalty, integrity and great service. On that day, a workman employed by the Department of Works - the Prime Minister will know that such men are only temporary employees - helped to get the building ready for the reception. He was asked to retire when the V.I.P.’s came along. He did that, but later he returned to the party with his coat off and participated in a drink or two for the occasion. When he turned up for work on the following Monday, he was sacked for gate-crashing and for appearing in the presence of the Prime Minister with his coat off. The opening of the Commonwealth Centre was a very historic occasion, but it was a drastic day for this poor worker, who has a family. I ask the Prime Minister whether he will consider this matter and see whether this man can be reinstated in his former position. Possibly, he merely wanted to participate in the historic occasion, the same as everybody else did.

Sir ROBERT MENZIES:
LP

– I do not need to tell my friend from Banks that this is the first that I have heard of this matter. I certainly took no exception to this man’s presence. Indeed, if I had been told that somebody was giving him a drink I would have been disposed to give him a second for good measure, because, as the honorable member knows, his description of the treatment of the man is not my way of going about things. I will find out about this matter. On the face of it, it does not seem very fair. But, of course, there are usually two sides to these matters. I will make inquiries from ,lie Minister for Works and see whether we can provide my friend from Banks with an answer to-morrow.

page 2311

ADVANCE TO THE TREASURER

Report of Public Accounts Committee

Mr THOMPSON:
Port Adelaide

– I present the following report of the Public Accounts Committee: -

Sixty-third Report - Expenditure from Advance to the Treasurer for the year 1962-63.

Ordered to be printed.

Mr Thompson:

– I ask for leave to make a brief statement on the activities of the Public Accounts Committee.

Mr SPEAKER:

– There being no dissentient voice, leave is granted.

Mr. THOMPSON (Port Adelaide).Because of the sudden decision to terminate this parliamentary session, the Public Accounts Committee has not been able to complete the inquiries on which it has been engaged. The committee usually submits a report on the annual report of the Auditor-General. Although we have taken evidence from representatives of a number of departments, we have not been able to prepare that report and present it to the Parliament before the end of the session. ^1 trust that honorable members will realize that it is through no fault of the committee’ that it has not been able to complete the work that it desired to do and to submit reports in accordance with its duties. The chairman of the committee is overseas. On his behalf, I am making this statement which, as honorable members know, will be the last statement that I will make in connexion with the Public Accounts Committee.

page 2311

PARLIAMENTARY AND GOVERNMENT PUBLICATIONS

Report of Joint Select Committee

Mr ERWIN:
Ballaarat

– I present the following paper: -

Report from the Joint Select Committee appointed to inquire into Parliamentary and Government Publications.

Ordered to be printed.

Mr Erwin:

– I ask for leave to make a statement in connexion with the report.

Mr SPEAKER:

– There being no objection, leave is granted.

Mr. ERWIN (Ballaarat).- The report of the Joint Select Committee on Parliamentary and Government Publications, which I have just presented, explains to the House that, in view of the impending dissolution of this House, the committee has found that it is unable to complete its report. The committee regrets that. However, the reference given to the committee was extensive in its scope. The inquiry has ranged over a large and quite diverse, though pertinent, number of matters and much valuable information has been received. The committee recommends in its report that it be reconstituted in the new Parliament to conclude and to report on the work done during the present session.

page 2311

QUESTION

QUESTIONS

Mr SPEAKER:

– Last Thursday, the honorable member for Fremantle (Mr. Beazley) asked me whether I would examine the practice of the House of Commons to see whether any power is vested in its Speaker to insist on the early answering of questions. A somewhat similar question was asked of me by the honorable member for Fremantle on 17th November, 1959. On the following day, I informed him that the position in the House of Commons, as stated at page 357 of the sixteenth edition of May’s “ Parliamentary Practice “, is that an answer to a question cannot be insisted upon if the answer be refused by a Minister. It follows that no power in this matter is vested in the Speaker.

I re-stated the position in this House which had been declared by my predecessor, Mr. Speaker Cameron, on 28th November, 1951, in reply to a question relating to this matter, namely, that he was being asked to do something outside his powers and responsibilities, that it was for Ministers to decide when questions would be answered and that that was their responsibility. Mr. Speaker Cameron said that it was not his responsibility and that he did not seek it - a view with which I agree.

page 2312

OVERSEAS TELECOMMUNICATIONS BILL 1963

Bill presented by Mr. Davidson, and read a first time.

Second Reading

Mr DAVIDSON:
PostmasterGeneral · Dawson · CP

– I move -

That the bill be now read a second time.

The bill seeks authority to permit the Overseas Telecommunications Commission (Australia) to establish and maintain cable and wireless telecommunication systems for public communications between Australia and Nauru. It also seeks authority for the commission, subject to Ministeral approval, to establish and maintain cable and wireless telecommunication systems arranged in a country or place other than in Australia, under the Commonwealth Telegraphs Agreement 1948 or any other agreement to which the Australian Government is a party.

At present, the commission has the authority to establish and maintain cable and radio telegraph services between Australia and territories administered solely by the Commonwealth. The bill proposes that the commission assume responsibility for the establishment of facilities at Nauru, of which Australia is one of the joint administering bodies. The facilities at Nauru have been conducted on behalf of the Nauru Administration by Amalgamated Wireless (Australasia) Limited, but there has been agreement that responsibility for the services should be transferred to the commission. As it is the view of the SolicitorGeneral that the act, in its present form, does no provide the appropriate authority for the commission to operate the Nauru station, the amendments in clauses 5 and 8 are now being proposed.

Clause 9 seeks to provide authority, subject to the consent of the Minister and subject also to the observance of the law of the country or place concerned, for the commission to establish facilities for the conduct of international communications in a country other than Australia after an appropriate agreement has been reached. Australia is a participant in the Commonwealth round-the-world cable scheme, which has involved various members of the British Commonwealth in a joint partnership venture in the provision of the Commonwealth Pacific COMPACand South East Asian Commonwealth Cable SEACOM links. Already arrangements have been made for an interconnexion of the COMPAC cable with a cable owned by American interests in the Hawaiian Islands. Provision has been made for the Canadian Overseas Telecommunications Corporation to operate the station established at the interconnexion point. The possibility of a similar interconnexion to facilitate the handling of traffic with other cable providers in SouthEast Asia is foreseen. Opportunity is, therefore, being taken also to amend the act to enable the Overseas Telecommunications Commission (Australia) to establish and operate interconnexion facilities arising from any government agreement that may be made with other countries.

Clause 13 amends the principal act by including, as the Fourth Schedule to the principal act, the recent supplementary agreement which has been signed by the Commonwealth Telegraphs Agreement 1948, and which embodies changes and amendments which have been made from time to time. The principal changes involve the recognition and admission of new partners to the agreement, namely Ceylon, Cyprus, Nigeria, Ghana and Malaya, the withdrawal of South Africa from the Commonwealth and the substitution of the

Federation of Rhodesia and Nyasaland as a partner in the place of Southern Rhodesia. It embodies, too, the terms of an operational agreement which sets out the relationship between all the partner governments and the Commonwealth Telecommunications Board and which defines the board’s role on behalf of the partners in matters of policy. Mr. Speaker, I commend the bill for consideration by the House.

Debate (on motion by Mr. Beazley) adjourned.

page 2313

STATES GRANTS (SPECIAL ASSISTANCE) BILL 1963

Second Reading

Debate resumed from 22nd October (vide page 2105), on motion by Mr. Harold Holt-

That the bill be now read a second time.

Mr BEAZLEY:
Fremantle

.- There is nothing controversial about this measure. The Opposition wants it to have a speedy passage. The grants of £6,072,000 to Western Australia and £5,378,000 to Tasmania are obviously based on the recommendations of the Commonwealth Grants Commission after careful analysis of the State budgets. Every recommendation of the Commonwealth Grants Commission has been accepted by each Government since 1933. I think that there is a case for a review of the system of grants to the claimant States of sums of money based on the budgets of what are called the standard States, but in the atmosphere of a dissolving House of Representatives this not the time to review the system. The Opposition supports the proposal and the arrangement which authorizes the payment of advances to Western Australia and Tasmania in the earlier months of the 1964-65 financial year.

Question resolved in the affirmative.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.

Third Reading

Leave granted for third reading to be moved forthwith.

Bill (on motion by Mr. Downer), read a third time.

page 2313

NATIONAL HEALTH BILL 1963

Second Reading

Debate resumed from 22nd October (vide page 2112), on motion by Mr. Swartz -

That the bill be now read a second time.

Mr DALY:
Grayndler

.- The Opposition supports this measure, Mr. Speaker, but, while not wishing to delay the passage of the bill in any way, we feel that there are some comments that should be made about it, even at this late stage, in the dying hours of the Parliament.

The bill is very limited, as is indicated by the title, which describes it as a b:ll relating to the special accounts of hospital benefits organizations. . As it is so limited in scope, it will not be possible for us to debate in full the National Health Act. lt appears that the Government is determined that the National Health Act, in connexion with which it is so vulnerable, will not be discussed in detail. I can well appreciate the reason why the Government is avoiding debate on this measure. If there is any Government legislation with which the people are dissatisfied it is the National Health Act. If I may say so without infringing the Standing Orders, and simply by making a passing reference, it is reasonable to assert that the national health scheme is among the worst of such schemes in the world. Not only has it failed to achieve its aims, but it is also in danger of breaking down because of its own defects.

Mr Haworth:

– I raise a point of order, Mr. Speaker. Is the honorable member in order in raising the question of the national health scheme? I remember the Minister who introduced this bill saying that it relates to one part and one part only of the National Health Act.

Mr SPEAKER:

– Order! The honorable member would not be in order in debating the subject-matter generally of the Nation;:l Health Act. I presumed he was making a slight passing reference to the act, and I hope that he will come back to the measure before the House.

Mr DALY:

– I mentioned earlier, Mr. Speaker, that I understood fully the implications of the measure. I can well appreciate the attitude of the honorable member who raised the point of order. When all is said and done, it is the people who will shortly pass judgment on this Government’s National Health Act.

Mr SPEAKER:

– Order! The honorable member must come back to the bill before the House.

Mr DALY:

– I cow come back to the bill under discussion, Mr. Speaker, and I point out again why it has this title: -

A bill for an act to amend the provisions of the National Health Act . . . relating to the Special Accounts of Hospital Benefits Organizations.

This is a new method of introducing legislation which this Government has devised. It is designed to allow debate on only one particular and small point, and to preclude any reference to issues on which the Government is vulnerable. It is the second of such amendments to be introduced in recent times, and it is designed for a purpose quite apart from that stated in the amendment itself.

I will now direct my remarks specifically to the measure under discussion. It refers only to the special accounts of hospital benefits organizations. The system was introduced in January, 1959, because a number of claims for hospital fund benefits had been disallowed because the applicants were suffering from pre-existing ailments and chronic illnesses. The rules of the funds debarred those applicants from entitlement to benefits. Perhaps it is best explained in the words of the then Minister for Health, Dr. Cameron, who, when introducing the bill on 16th September, 1958, said -

Medical and hospital insurance is necessarily conducted, not only in Australia, but also in other parts of the world, on an actuarial basis. This means that insurance funds insure their members only against what may be termed normal risks. No medical or insurance fund could survive for long if its business was conducted on any other footing. . . . The older members of the community are specially subject to these extra risks, which take the form of chronic and long-term illnesses and ailments in existence prior to the date of joining an insurance fund . . . . . medical and hospital insurance organizations will be invited to establish special accounts for the payment of benefits to the aged, to persons with pre-existing ailments and to the chronically ill. These accounts will be operated and maintained by the organizations themselves, but they will be guaranteed by the Commonwealth. Upon establishment of -a special account an organization will credit to the special account the contributions of all members who attain the age of 65 years. These members will become entitled to benefits from special account, regardless of the nature of the illness, the length of the illness or whether it was a condition from which they were suffering at the time they joined the fund.

That was the basis upon which this legislation came to light. According to the Minister at the time, up to 30th June, 1958, hospital fund contributors were disqualified from hospital fund benefits for more than 1,000,179 days by the rules of the funds in connexion with chronic illnesses and other matters. In other words there was a 12 per cent, disqualification. At that time the Australian Labour Party, through the honorable member for Eden-Monaro (Mr. Allan Fraser), pointed out the deficiencies of this system and the need to cater for these people. The Government subsequently did that, to a very limited extent, under the special accounts system. In the circumstances that I have mentioned, it was said that Government assistance was necessary to enable the funds to remove the restriction, and thus was established what is known as the special accounts system. To-day fund benefit, at least up to the standard rate, is, I understand, being paid for these claims without many exceptions. There has, however, been much well-justified criticism from time to time of defects in the system, and, as usual, it has taken’ the Government until now, when we are on the eve of an election, to realize that injustices are being inflicted. As stated by the Minister for Repatriation (Mr. Swartz) in his secondreading speech, the apparent deficiencies demanded attention, and after consultation with hospital benefits funds these amendments have been introduced.

It should be said, however, that the operation of the scheme meant, in effect, that the Commonwealth Government, by guaranteeing funds for claims under the special accounts system, provided payment for those previously debarred by the funds because of pre-existing ailments, chronic illnesses or the maximum annual benefit rule. It should also be said that when the special accounts system was introduced the Opposition pointed out that it was a reform for which the members of the Opposition had been agitating ever since the original health- legislation -vas introduced. We pointed particularly to the injury which would be inflicted upon people suffering from pre-existing ailments and chronic illnesses. Time and time again, we impressed upon the Government the need to remove the hardship which the existing scheme imposed upon the people in the categories mentioned.

The Opposition has also, since that time, continually brought to the attention of the Government the need for amendment of the special accounts system to remove injustices and deficiencies which were most apparent. To-day, therefore, while we consider much more could still be done, we support this measure because it is another step towards improving the National Health Act, which, Mr. Speaker, every one realizes leaves plenty of room for improvement.

At this stage I may be pardoned for saying that the date on which the special accounts system came into operation, namely, 1st January, 1959, is very significant. The measure was introduced into this Parliament by the then Minister for Health, Dr. Donald Cameron, on 16th September, 1958, on the eve of the federal election that was held in that year. It was not to take effect until January, 1959, after the election. History records that Dr. Cameron did not live politically to see the fruits of his labours, as he was defeated in the nation-wide swing to Labour that struck Government members so swiftly and devastatingly in December, 1961.

Mr Haworth:

– What has this to do with the hill?

Mr DALY:

– I am speaking of the man who introduced the legislation and of the date on which it was put into operation. The measure before us, an amendment of the original act, is now being introduced on the eve of a federal election. It is to come into operation on 1st January, 1964. It seems that on the eve of every federal election we can expect some amendment of this monstrous act, under the provisions of which the people are suffering at the moment. Far be it from me to disturb the slumbers or the hopes of the Minister for Health (Senator Wade) or his deputy in this House, but I wonder if it is too much to expect that history will repeat itself and that at least the Minister’s deputy will be removed from the Government benches in the not far distant future. To say the least, from the point of view of that honorable gentleman, the signs are ominous and somewhat frightening in the light of past events.

The honorable member for Perth (Mr. Chaney) is doing his best to interject. I know these arc touchy subjects from the point of view of honorable members opposite. I summarize my point in this way: The last amendment to this act was introduced on the eve of a federal election. It took three years for the Minister to bring it before the House, and because he delayed so long he is no longer with us, as many honorable members opposite will not be with us a few weeks from now. That will bc a good thing for the country.

I now come to the specific provisions of the bill. I will deal with them at some length because they are worth repeating and because they are somewhat involved. Clause 4 provides for the removal from the act of the requirement that contributors must be transferred to the special account at the age of 65. This means that contributors aged 65 years or more are entitled to, and will receive, the same benefits as other contributors, and a contributor’s age will not affect his eligibility for hospital fund benefits. In cases where fund rules provide that contributors’ claims are not to be limited to the amount of hospital charges, persons over 65 will receive the advantage of this on an equal basis with other contributors; similarly, persons aged 65 or more who are transferred back to ordinary accounts, and who wish to be members of more than one organization, will have this right on the same basis as other contributors.

A further amendment - and a very important one - is the proposed removal from the principal act of the requirement that special account contributors may not be paid benefits in excess of the hospital charges. This means that special account contributors’ benefits will no longer be limited by the act to the amount of the hospital charge, and such contributors will be entitled to the same benefits as ordinary contributors in accordance with the rules of the fund. In cases where the fund rules provide that contributors’ claims are not to be limited to the amount of the hospital charge, :he rule will apply equally to special account and ordinary contributors. Where the rules of the fund limit the benefit to the amount of the hospital charge, the rule will apply equally to both special account and ordinary contributors.

Another amendment to the principal act will be made by another important provision in this bill, which will make changes in arrangements between the Commonwealth and hospital insurance funds for the debiting of benefits to the special account. At present, hospital funds pay benefits from the ordinary account for a maximum number of days each year - normally 84 or 91. Those contributors who are b hospital for more than the specified maximum period are then transferred to the special account and receive standard-rate benefits. The amendment to section 82ca of the principal act contained in clause 5 of the bill will enable funds to transfer the liability for these contributors to the special account 21 days - I ask honorable members to note the number of days - before the maximum period of benefit at ordinary rates terminates.

The amendment to section 82d of the principal act, contained in clause 6, provides that where benefit in excess of the hospital charge is paid, the amount in excess of the hospital charge will be debited to the fund’s ordinary account. This will not affect the contributor, but will have certain effects on the funds.

These are the main amendments to the principal act contained in the bill, Mr. Speaker. These amendments are properly made, though they are rather belated. The other amendments to be made to ‘ the principal act by this bill are merely of a machinery nature. The Opposition has no objection to the bill and does not wish to delay its passage. However, it is pertinent for us to direct the Government’s attention to a few matters relating to the bill and to ask questions about them.

The removal of the requirement that benefits may not be paid in excess of the hospital charge is very desirable and long overdue. This requirement was imposing hardship and injustice on many people, as the Minister for Repatriation (Mr. Swartz) mentioned in his second-reading speech, though one could ask why provision is being made to transfer contributors whose period in hospital exceeds the specified maximum number of days to the special account 21 days before the maximum period terminates. The Minister has stated that this will not affect contributors but will be financially helpful to the funds. This is quite correct. Anybody who has seen what the reserves of the funds are knows that many of them are not exactly struggling organizations. Are we to take it that the proposal is designed to help the funds and to enable them to make greater profits and build up higher reserves at the expense of the taxpayer? As I shall show later, Mr. Speaker, many of the funds are not exactly short of cash or reserves, and a full inquiry into their activities and administration at some time in the future would probably be justified in view of what is taking place in relation to some of them at the present time. The Minister has given no satisfactory reason, and I can see no reason, why the funds should not meet their obligations instead of passing on their liability to the Commonwealth.

I suppose that one has to be rather tolerant of interpretation and administration in relation to legislation such as the National Health Act. It is doubtful whether any of those associated with the administration of our present act fully understand its implications, particularly the implications of the special account provisions. Many of the health organizations do not understand the implications, and I am certain that very few members of the public comprehend the ramifications of this unwieldy, unsatisfactory and unworkable national health scheme.

Before I pass on to the main provisions of the bill, I want to discuss the position of those over 65 who to-day have to nominate their age before they can receive certain benefits. This has been an unfortunate provision in the National Health Act for many contributors. It has resulted in considerable injustice and dissatisfaction for people, particularly those in the older groups, who went on to the the special account after reaching the age of 65. Mr. Sheahan, the present Minister for Health in New South Wales, a very able man, has been very outspoken on matters concerning the National Health Act. He has spoken from time to time with great knowledge of the special account provisions that we are discussing to-day. Mr. Sheahan moves a lot faster than this Government. docs. As early as 24th August, 1962, he wrote to me and to other honorable members about these matters. No doubt, prior to that, he had written to many other honorable members about many aspects of the National Health Act. In the letter to which I refer, Mr. Sheahan outlined certain comments on the special account provisions, one of which was as follows: -

The introduction of the Special Account has brought much relief to certain classes of patients, but unfortunately to the detriment of the person over the age of 65. No matter how many funds a person in this age group subscribes to, the present rules exclude him from obtaining the cover he desires.

To some extent, the measure that we are now discussing will relieve that situation. Mr. Sheahan went on to contrast the positions of a man under the age of 63 and a person over the age of 65, both subscribing to a fund on the same basis, both requiring similar medical treatment and both incurring the same costs. I shall not weary the House at this late stage by recounting the full details. I shall merely summarize the submissions that Mr. Sheahan made to me and to other honorable members. He summarized the position in this way -

From this it can clearly be seen that because of his age the person in Case No. 2 is denied the right to cover himself for hospital treatment in an intermediate ward. It is quite evident therefore, that a person over the agc of 65 is classified by agc rather than diagnosis and so because be has grown old is penalised and not allowed the privileges of a younger person. This surely is not social justice.

While admitting then in many cases the introduction of the Special Account to hospital funds has proved to be of benefit, the same rules should apply to all age groups in the community. That is to say, that everyone irrespective of age should be classified by diagnosis and the rule that once a person is transferred to the Special Account be revert to the normal fund benefits after a two year period, should be spread over the whole community. In other words, age should not be the determining factor as to where a person can bc placed in hospital.

I have thought it proper to bring these matters under notice because there is so much confusion in the public mind of the operation of the Hospital Benefits Funds that very few people understand their rights, and in my opinion the system is so complicated that it needs a complete revision in order to simplify it so that the ordinary man in the street can understand the Hospital Benefits Funds operation.

Although this bill may no.l go so, far as the Opposition would “like, “it will, to some extent, remove some of the disabilities and injustices that Mr. Sheahan mentioned in that letter.

To show the need for amendment of the principal act, I quote from a statement made some time ago by Mr. N. A. Rhodes, secretary and chief executive officer of the Orange Base Hospital. Dealing with the special account provisions, he stated -

The introduction of the Special Account has brought much relief to certain classes of patients, but unfortunately to the detriment of the person over the age of 65. No matter how many funds a person in this age group subscribes to, the present rules exclude him from obtaining the cover he desires.

Mr. Rhodes went on to say that there was need for an amendment of the act, which, belatedly, the Government has introduced. But I hesitate to think what would have happened to the unfortunate people concerned bad a federal election not boon pending. Undoubtedly, this Government would have perpetuated the injustices. Only when it is in fear of political defeat does this Government bother to make adjustments of the kind sought by the New South Wales Minister for Health and other men who are prominent in the medical profession and in hospital administration, and who have long mentioned the need to make these changes.

I do not wish to discuss further the amendments to the principal act proposed in this bill, as no doubt other Opposition members will do so. I merely say that we on this side of the House support the proposals, but they do not go far enough and that they are belated. There is grout need for a still further overhaul of the special account previsions as well as of other provisions of the National Health Act.

I desire now to direct my attention to the organizations that are specifically affected by the bill. I refer to the hospital and medical benefit funds. The debate on the bill now before us is tied up with certain legislation that affects the funds, and I therefore wish to devote a few moments of my time to a discussion of this important aspect of the national health services. The bill provides the Opposition with the opportunity to bring to public notice certain relevant ,and important matters regarding hospital and medical benefit organizations.

A short time ago my colleague, the honorable member for Hughes (Mr. L. R. Johnson), in a very capable and detailed speech, brought to the attention of the Parliament certain facts about these funds. He is to be commended for having done so. He used figures to show that the funds are not functioning as efficiently as they should be. It would not be unfair to say that some funds are more concerned about guaranteeing doctors’ bills than they are about the cost to patients. I do not want to develop this aspect, but I think it is correct to say that increased benefits paid by funds generally find their way to the doctors, because the doctors raise their fees when the benefits are increased. Mr. J. A. Eade, spokesman for the Federal Council of Friendly Societies, said that the contributors are still as badly off as they ever were. I understand that the Minister for Health (Senator Wade) is seeking assurances from doctors that they will not increase their fees before he will consider increasing the Commonwealth’s contribution. I wish him luck in his efforts. So far, no decision has been reached by the doctors, but I trust that the efforts of the Minister will meet with success.

We have so many hospital and medical benefit organizations that there must be duplication of their functions and this must lead to inefficiency. I think it was the honorable member for Hughes who brought to the attention of the Parliament that on 30th June, 1962, there were 113 hospital funds and 82 medical funds, making a total of 195 funds. All of these funds are involved in the administration of the special account, which we are discussing to-day. From 1953 to 1962, the operating expenses of the funds amount to £29,000,000. The administrative costs of the Taxation Branch amount to 1 per cent, of all the taxes collected. The operating costs of the hospital and medical benefit funds amount to 15 per cent, of contributions. Whilst this comparison may be unfair, there is such a great disparity that the inefficiency of a multitude of hospital and medical benefit organizations must be recognized.

Mr Buchanan:

– I take a point of order, Mr. Speaker. I suggest that the honorable member is getting very wide of the bill. The bill makes a simple alteration to the special account.

Mr SPEAKER:

– Order! 1 think the honorable member is well aware of the limitations of the debate. I ask him to relate his remarks to the subject-matter of the bill.

Mr DALY:

– With due respect to your ruling, Mr. Speaker, I point out that the bill specifically deals with the special account operated by the hospital and medical benefit funds, of which there are 195.

Mr SPEAKER:

– Order! I point out to the honorable member that a passing reference to the funds would be in order. However, he would not be in order if he devoted his remarks entirely to the funds, to which he has already referred.

Mr DALY:

– Mr. Speaker, may I ask whether you rule that, although the funds will receive huge amounts from the Government, I cannot discuss their administration, the operations of the special account, or the way the benefits are paid and that I must confine my remarks to special accounts, without making any reference to the hospital benefits organizations, all of which are expressly covered in this amendment to the principal act?

Mr SPEAKER:

– I point out to the honorable member that a reference to the funds would be in order. However, if the honorable member departs completely from the subject-matter before the Chair and spends the whole of his time dealing only with that phase, he would not be in order.

Mr DALY:

– Mr. Speaker, it is only because of my respect for you that I accept your ruling in the dying days of the Parliament. If it were not for the respect I have for you I would certainly move dissent from your ruling. With due deference to you, I think your ruling is completely wrong. We are now called upon to pay some millions of pounds to hospital and medical benefit organizations, which are expressly mentioned, but we are prevented from speaking about the funds in this Parliament and they are protected from criticism. I can say only that this is done deliberately by the Government. The amendment to the principal act is expressly worded as it is so that the hospital and medical benefit organizations . will be protected from constructive criticism; . ;<

The funds in Sydney are now waging a war at the expense of their contributors. There is a lot to be said for the special accounts system. However, when we realize that 195 funds are functioning to-day we must ask why the whole national health scheme could not be administered as the special account system is. Contributions are paid, but the Government guarantees the funds against loss arising from the operations of the special account. There is no reason why the principle behind the special account could not he extended to cover all the operations of hospital and medical benefit organizations. In other words, the special account is really a fund run by the Government. Contributors pay into it, but the Government guarantees it. The commitments are met and to all intents and purposes it is a government organization. Despite this, 195 funds are allowed to function. The Government does not care whether they are run efficiently and, because of the wording of the provisions of the bill, we are not allowed to debate the efficiency of the funds in this House. I would deal with this matter at some length, if I were not prevented from doing so.

Mr Haylen:

– Go on.

Mr SPEAKER:

– Order! The honorable member for Parkes will remain silent.

Mr DALY:

– I can make only a passing reference to the funds. However, I point out to the Parliament that certain organizations in Sydney, notably the Hospitals Contribution Fund of New South Wales and the Medical Benefits Fund of Australia Limited are paying £400 or £500 a day for advertisements in the press as part of the faction fight they are waging. All this is done at the expense of the contributors. Why does the Government not investigate what is happening and how the money of contributors is being spent? I do not criticize the funds for the work that they do. I would say that they are doing commendable work and we encourage private funds. However, we do say that there is a need for an investigation at this time and I regret that, because of your ruling, Mr. Speaker, I cannot elaborate on this subject.

Apparently the Government does not want mc to talk about the operations of the funds. I might well ask.in this situation:

What has the Government to hide in its administration of the special account? It is paying large sums of money to the hospital and medical benefit organizations. Why am I not allowed to discuss this matter? Is there something sinister in the Government introducing the bill on the eve of a federal election and tying the hands of every honorable member who wants to discuss a matter of great public and national importance? We should be allowed to discuss the administration of the funds to which we are paying large sums of money to-day. I do not make any bones about it. I do not think the Minister for Health knows anything about the department, about the administration of the funds or about anything associated with these matters. He does not care what happens to the money that goes into the special account. He has introduced this bill only to protect incompetent funds and to hide the Government’s maladministration. It is well to remember that if it were not for the fact that an election is about to be held the people covered by the special account provisions would be allowed to suffer for all time. The Government is not concerned about them. In a most contemptible way it has tied the hands of all honorable members and has refused to allow us to debate this subject. The bill is worded in such a way that it is hardly worth debating. I know full well that the Government does not want to improve the national health legislation at any time and it does not want us to go into the ramifications of the national health scheme or the special account.

The attitude of the Australian Labour Party on the special account and all other aspects of the national health scheme will be clearly stated in about a week’s time. Labour does not believe that it should be mandatory for people to belong to a hospital or medical benefit organization before they can receive benefits under the national health scheme. They are paying taxes, from which payments are made to the special account. Labour believes that if people pay taxes they are entitled to receive hospital and medical benefits from the Commonwealth. The Australian people can take it for granted that when we are elected as a government we will amend this legislation to provide that health benefits will be granted to people irrespective of whether they are in a benefit fund or not. This legislation is opposed to every principle of freedom and of the rights of the individual, because it indirectly compels people to subscribe to a fund in order to get the Commonwealth special benefit account or anything else.

I regret, Mr. Speaker, that you did not let me elaborate on a matter of gre: 1 political moment and of great concern to the Government.

To-day we saw the Government, on the eve of a federal election, ashamed to debate the National Health Act or to give us the opportunity to show that the Commonwealth special account is paying moneys into some funds which are inefficient and that some of the money may go to the “Sydney Morning Herald”, the “Daily Telegraph “ and other great newspapers in an advertising war the funds are fighting in order to see which can get the most from the Government with the least possible outlay. The Deputy Leader of the Opposition (Mr. Whitlam) has had recorded in “ Hansard “ - in answer to questions - what is happening in regard to the reserves of £25,000,000 of these funds, where contributors are being paid a minimum of their just entitlement. It is in every way a matter which ought to see the light of day and be discussed. But to-day we are gagged and curtailed in respect of this question, on the eve of an election.

I conclude on that note, because other honorable members of the Opposition wish to speak in this debate and we have no wish to delay the passage of the measure. I am sorry I could not give full force to what I wished to say in. respect to hospital benefit organizations, but other opportunities to do so may be given before this Parliament finishes. Even if that is not so, these things will be said during the election campaign. I remind the Minister for Social Services (Mr. Roberton) that Dr. Donald Cameron, formerly Minister for Health, was defeated in the last election because of his health legislation. Let that be a warning to the Government. Curtailing and restricting debate on the worst national health act in the world to-day will not save it from defeat, which it richly deserves.

Mr HAWORTH:
Isaacs

.- One can quite understand why the honorable member for Grayndler (Mr. Daly) takes the very critical attitude which he has taken towards this bill. The Australian Labour Party has always been extremely jealous of this Government for its ability to provide the community with a hospital insurance scheme which functions, and functions well. It covers 73 per cent, of the community. Who are the the other 27 per cent.? Of them 10 per cent, are pensioners and 5 per cent, are those covered by repatriation benefits.

Mr Daly:

– Mr. Speaker, I rise to a point of order. I desired to quote those figures, but before I came to them in the course of my speech you ruled me out of order. I now ask that you give the same ruling in regard to what the honorable member for Isaacs is saying.

Mr SPEAKER:

– Order! The honorable member for Isaacs is fully aware of the matter before the Chair. I ask him to relate his remarks to the bill.

Mr HAWORTH:

– I will have very much more pleasure than the honorable member for Grayndler had in doing so. I wanted to point out that the hospital insurance fund, of which the special account is portion, covers 73 per cent, of the community and it is only natural to ask: “ What of the balance of 27 per cent.? “ The reason why I mentioned that 27 per cent, was to point out, in passing, that of them 10 per cent, are pensioners and 5 per cent, are covered by repatriation benefits. The balance is composed of people provided for by the State and by mental institutions.

The amendment of the National Health Act in regard to the special account meets with the approval of the whole community and is not contentious. It has been foreshadowed by the Government for some considerable time and it is only natural that the Government wants this anomaly to be corrected as soon as possible, because its existence and the fact that it can be corrected have been proved by the statistics we now have in regard to the scheme. This is a bill ‘ designed, in the main, to dispense with the necessity for transferring contributors from the ordinary accounts to the special accounts of hospital benefits organizations when they reach the age of 65 years. It has also established a further benefit for those 65 years and over - if I may put it that way. That is, where a fund organization states that a contributor is entitled to a claim, irrespective of whether the hospital charges reach the claim provided, that claim will be paid - or the difference will be paid - in the same way that it is paid to persons below the age of 65 years and who, naturally, would be contributors to the ordinary account. There are also other advantages of a minor nature contained in the bill, all of which will help the smooth running of the present very successful voluntary hospital insurance scheme.

The special account system, since its introduction in 1959, has added a considerable number of contributors to the hospital insurance organizations. It has opened up new avenues of insurance for people who previously were uninsurable for an hospital benefit because of certain disabilities that they had. There is no other system quite the same as this in any other part of the world and we know it is the envy of most countries in Europe to-day. What is being done in this bill by removing what we thought in the past to have been anomalies in hospital insurance is the result of the experience gained in the operation of voluntary health insurance over the last thirteen years. This Government has gained a tremendous amount of experience, having been able to introduce a system which has been tremendously successful and popular and which is providing facts and figures to indicate- how far the Government can go in providing a health insurance scheme for the whole community.

Nothing is static in science, and neither should it be so in a health scheme in which medical science plays such an important part. We must be constantly looking for improvements in the National Health Act and I am glad to say that the Government recognizes this need. This bill is a true indication that the Government is anxious to do just that, and that when it sees the opportunity to correct an anomaly or introduce some new principle or benefit to the national health scheme or the national insurance scheme it is ready to do so.

The total hospital benefits paid from the special accounts from the date when they came into operation until 30th June this’ year amount to £1.2,000,000. This sum is money which the people of the community would have had to pay, had provision not been made for it by the special account system. This gives some idea of the great benefit that the special account has been to contributors to hospital benefits funds. The Government Members Health Committee, of which I have the pleasure of being chairman, has given this matter close examination for a considerable time. It has examined the proposals now under consideration and believes they will be helpful additions to the hospital benefits scheme which is now in operation and, as such, constitute a good amendment to the National Health Act.

I have great pleasure in supporting the bill and I hope it will have a speedy passage through the House, because the sooner it comes into operation the better it will be for members in the community who, unfortunately, have suffered from the anomalies that have existed.

Mr L R JOHNSON:
Hughes

– This bill is of comparative inconsequential importance when one has regard to all the deficiencies of the National. Health Act. As the honorable member for Grayndler (Mr. Daly) pointed out, this bill is a last desperate bid on the part of the Government to patch up an inadequate national health scheme - a scheme which the honorable member described as one of the worst in the world. The honorable member in my view was right on the ball in that description because wherever one goes in the community these days one hears grumblings and growlings about our health scheme, particularly as it affects aged people.

Since January, 1959, when the special account system was introduced, aged people, chronically ill people and those suffering from pre-existing ailments have been completely confused and unfairly treated. The first essential of any health scheme, if it is to be effective, is that it be understood, but, as has already been pointed out, no one can understand the ramifications and trappings of our present scheme. Obviously the Minister for Health (Senator Wade) does not understand the scheme because whenever a member writes to the Minister on behalf of a constituent who is a pensioner or who may be suffering from a preexisting ailment, the Minister rarely replies in a way that can be understood. I am sure that most honorable members do not know anything about the scheme, yet they are in the best position to learn the details of it. One almost needs the advice of Queen’s Counsel if he is to be certain of the extent to which he will be covered by the scheme, and this observation applies particularly to those persons who are covered by the special account system. The best thing to do with our present national health scheme, particularly the special account system, is to scrap it.’ We on this side of the House believe that it is impossible to patch up the present scheme as the Government is endeavouring to do at the moment. We believe that we must build a new Australian health service. Such a service must be based on simple concepts, one of which is that sick people need care. That is what we of the Opposition stand for. We want to herald this information out to the countryside: As soon as Labour sits on the treasury bench it will introduce a health scheme along the lines I have indicated.

The bill removes from aged and chronically ill people the obligation to transfer to the special account. We believe th-.it pensioners should not be obliged to pay into a benefit organization at all.. Labour believes that responsibility for the hospital treatment of pensioners should be extended. ]f this were done there would be no need for the iniquitous special account arrangement. After all, this is a matter affecting the people on low incomes. It affects age pensioners and invalids, lt is important for honorable members opposite to understand that it is a bad principle to require everybody in the community to pay into benefit organizations regardless of his income. When we require pensioners and people on low incomes to pay into benefit organizations we disregard the principle of capacity to pay. We finance the Army, the Navy and other government services on the principle of capacity to pay, but this Government apparently wants pensioners to pay for the national health scheme to the extent that wealthy people pay. This is a matter that urgently requires looking into, because the affluent’ in our society are at present carrying no more of the burden of the national health scheme than are the poor unfortunates who are getting a lousy fiver a week or thereabouts. The first thing for the Minister for Health to do in regard to special accounts is to clarity the point that f have raised. Is it necessary for pensioners to contribute to benefit organizations?

Mr Buchanan:

– No.

Mr L R JOHNSON:

– If it is not necessary for these people to join benefit organizations, will honorable members opposite indicate why we have a special account system? Are we taking money under false pretences from our pensioners in respect of hospitalization? Can anybody answer that?

Mr Fox:

– Yes.

Mr L R JOHNSON:

– I am told by honorable members opposite and by the Minister for Health that this Government has introduced a system whereby pensioners may obtain free hospital treatment. Is that right or wrong? lt has been contended - several honorable members opposite agree with this contention - that pensioners may obtain free hospital treatment. If we are to provide free hospital treatment, one wonders why -

Mr SPEAKER:

– Order! The honorable member is now getting a little wide of the bill. He should relate his remarks to the bill.

Mr L R JOHNSON:

– I am attempting to establish whether the special account system is justified. The bill deals completely with special accounts. 1 have extracted from honorable members opposite the acknowledgment that this Government indicated that it would provide free hospitalization for pensioners. If the Government were to do that there would bc no need for anybody to join a benefit organization and no need to transfer to the special account. But what honorable members opposite have submitted to be a fact is not a fact at all. Pensioners in Australia cannot obtain free hospitalization in every State. The annual report of Director-General of Health states -

Arrangements were therefore made with (ho State authorities for public hospitals to treat eligible pensioners in public wards without charge and to be paid a Commonwealth benefit of 36s. a day.

If that were the case there would be no need for us to discuss special accounts in this Parliament to-day, but that is not the case. The only pensioners who can obtain this benefit in States other than New South Wales and Queensland are those who have a pensioner medical card, but 96,000 pensioners do not have a pensioner medical card. That is the unfortunate situation today. Might I say in passing that the Commonwealth pays to the States 30s. a day in respect of those people who have a pensioner medical card.. That is appreciated but in respect of the 96,000 pensioners who do not have a pensioner medical card the Commonwealth pays a miserable 8s. a day. What is completely overlooked is the fact that the average bed-cost in Australia to-day -

Mr SPEAKER:

– Order! The honorable member is now drifting further away from the bill. I ask him to relate his remarks to special accounts.

Mr Haylen:

– I raise a point of order! I would like some elucidation of this matter. During your long and distinguished career as Speaker you, Sir, have always allowed fairly wide discussion on a bill that seeks to make important alterations to the legislation. This is complex legislation. It relates to the health of the aged people in our community. You have always adopted a liberal approach to these matters and I respectfully request that in the final days of this Parliament you allow honorable members some latitude to refer to subjects related to the bill.

Mr SPEAKER:

– Order! I point out that the Chair has already been very tolerant. The bill before the House does not refer to pensioners and medical cards. The bill deals with the limited subject of special accounts. I am sure that the honorable member for Hughes is fully aware of this and I ask him to co-operate with the Chair.

Mr L R JOHNSON:

– Mr. Speaker, you are as helpful to-day as you usually are on difficult occasions. I will be the first to co-operate in this matter. I say no more than this: If the Government had provided free hospitalization for pensioners - honorable members opposite have indicated that this was the Government’s objective - there would be no need of special accounts. It is an unfortunate fact that £6 a day is not paid for hospital beds, as that is their average cost. In respect of many people who are confined to hospitals the Commonwealth pays only 8s. a day.

I would like the Minister, for Social. Ser-vices (Mr. Roberton), who . probably, will* reply on behalf of the Minister for Health, to indicate whether in his view the aged, the chronically ill and those with pre-existing ailments in Queensland will ever be in the position of being included in the special account system. Is it necessary for those people in Queensland even to join a benefit organization? As free hospitalization is available in that State it seems to be superfluous to require pensioners to join a benefit organization to cover their stay in hospital. If that is the case, all the aged and chronically ill in Queensland and those suffering from pre-existing ailments, would not be encompassed by the provisions of this bill. It would be taking money from them under false pretences, if they are not to receive any benefit from their contribution.

The position in New South Wales also needs clarification if we are to know to whom this bill really applies, particularly as the New South Wales Government has already stated that it will provide hospitalization for all pensioners including the chronically ill and those suffering from preexisting ailments. Most of them have been transferred automatically, at 60 years of age in the case of a woman and 65 in the case of a man, to the special account. Are they required to join a benefit organization? Will they be transferred to the special account in New South Wales which, apart from Queensland, is the only State to provide free hospital treatment in public wards for these people? It is unnecessary for them to join any benefit organization. I hope that I am now on the right track, Mr. Speaker.

Mr SPEAKER:

– I think even now the honorable member is getting a little off the right track.

Mr L R JOHNSON:

– I think you will agree, Mr. Speaker, that all my remarks are most relevant to the subject. It would be shocking if no attempt were made to answer the questions which I have posed. I am concerned about the inconsistencies in the proposal because we are spending the taxpayers’ money. It is amazing that the Commonwealth should contribute £1 a day for people in nursing homes and at the same time in the case of the chronically ill and the aged and invalid be prepared to contribute only 8s. a day in certain Circumstances. I do not want, to go, off at a tangent to any further extent than I may have done unintentionally, but I should like the Minister to state the position precisely because I am satisfied that his failure to do so in the past has resulted in thousands of pensioners and aged and chronically ill people in the special account category being robbed. Their money has been taken under false pretences because in the States to which I have referred specifically, and to a lesser degree in several other States, there has been no need for them to join any of the 188 benefit organizations now operating in Australia. I have asked the Minister to clarify the position but apparently it is beyond his understanding and comprehension, because at no time has he supplied a sensible answer to my questions. The pensioners do not know where they stand. They come to me and I, as their representative, pass on their questions to the Minister, but to date I have not received any clearcut advice. If the Minister cannot face up to the fundamental question which I have posed now it is a clear indication that the whole scheme is completely and utterly out of control.

As a result of the Government’s attitude and legislation it became necessary to introduce the special account system. . For the year ended 30th June, 1958, 8.3 per cent, of hospital fund claims were rejected on the ground of pre-existence of the ailment and 1.3 per cent, were disallowed on the ground of chronic illness. In addition, 2.6 per cent, of claims were rejected on the ground that the 89 to 91 day limit which various benefit organizations impose was exceeded. In that year - this was the year before the special account system was introduced - contributors were disqualified for claims in respect of 1,179,000 bed days. This represents 12 per cent, of all claims lodged with benefit organizations. I know you will concede, Mr. Speaker, that this is very relevant to the matter because it is the main point made by the Minister in his speech. In fact, the figures which I have just cited are not mine, but the Minister’s, so there is no need for any honorable member opposite to look tense and worried about whether I am off the track. I am right on the track. The fact that these benefit organizations have fluid reserves amounting to £28,000,000 does not seem to influence the situation. They are not prepared to Carry the a’ged, the ‘invalid and the chronically ill in our community. And this Government introduced legislation to under-write the organizations, to bolster them!

The problem which the Government is setting out to solve is one of its own creation because in its 1955 legislation - I am making now just a very brief passing reference - it imposed a means test on the pensioner medical service to debar from free hospitalization any pensioner receiving an income of more than £2 a week from any source other than the Department of Social Services. I have indicated the great crisis which developed because of this Government’s actions. Now it is ironical that the Government has found it necessary to try to mend the damage it has done. Honorable members on the Government side have good reason to be thoroughly ashamed about this matter.

I wonder how many people have been adversely affected to date. It is good for the Government to try to clean up the mess a little. It is disgraceful that the Government, by its folly in 1955, occasioned so much inconvenience to so many people and subjected them to so much hardship, misery and impoverishment. To-day 365,000 contributors are in the special account and apparently are contributing to benefit organizations unnecessarily. Unless my questions this afternoon are answered we can assume that this is the position, because the Government has failed to make a clear-cut announcement about this matter, particularly in relation to the States which give these people free hospital treatment.

Mr Buchanan:

– How many did you say were contributing?

Mr L R JOHNSON:

– I said 365,000 were contributing. I do not think the honorable members will dispute that figure, because it is contained in the department’s annual report. The bill now before us will make it unnecessary for patients over 65 years of age to transfer to the special account. Until now they have been contributing to benefit organizations at the same rate as have other contributors, but without receiving the same benefits. We believe that the Goverment’s previous legislation was unnecessary. Who can justify a state of affairs in which old people on a very low incom’e pay’ the same as do people on high

Incomes, but receive less benefit? It is very timely for the Government to take steps to remedy its own folly - this provision which has so adversely affected these people. The age barrier should never have been imposed, and we on this side of the House are happy that it is now to be lifted. Contributors to the special account will now receive the same benefits as do other contributors. But how many have been robbed to date? If it has been found necessary to right this wrong now, evidently there has been some injustice. This Government has been responsible for people being penalized since 1958 when the special account system was introduced. As I have already pointed out, this entire mess resulted from the 1955 legislation which imposed a means test on the pensioner medical service.

Certain clauses in this bill provide financial assistance in an indirect way to benefit organizations. At present, after 84 to 91 days hospitalization a patient is transferred as a liability from the benefit organization to the special account which the Commonwealth Government has under-written. I do not know whether the Government, when it introduced this measure, had a serious look at the figures to ascertain whether benefit organizations were operating efficiently and effectively.

There is a great deal to indicate that they were not. Many speeches have been made f rom this side of the House recently - I made one myself - about the inefficiency of benefit organizations, their duplication and their prestige buildings. There are now 188 benefit organizations, according to the most recent figure supplied by the Minister for Health. About six weeks ago, when I made a speech on this matter, I said that there were 192. Now there are 188 organizations, all providing similar services.

Mr SPEAKER:

– Order! I ask the honorable member to relate his remarks to the bill.

Mr L R JOHNSON:

– I mention these matters to indicate to you, Mr. Speaker, that when the Government establishes a special account system- an arrangement under which the Commonwealth takes the liability from the benefit organizations - it should ascertain whether the overhead, represented by the number of buildings, the duplicated staffs and the £28,000,000 of fluid reserves could take care of this liability instead of transferring it to the taxpayers through their custodian, the Commonwealth Government. I hope that all of that will appear to you, Mr. Speaker, to be relevant.

Under this bill, a transfer to the special account will be effected 21 days earlier than has been the case hitherto. Would some one be good enough to tell us why, at this time when the benefit organizations are building up such fabulous reserves, the Government intends to put a greater liability on the taxpayers and to diminish the liability of the benefit organizations? That is a fair enough question to ask. The Minister for Repatriation (Mr. Swartz), in his second-reading speech, said nothing to justify this proposal. We believe that the Government is tackling the whole problem in the wrong way. The Government should devise or contrive ways and means of reducing the unnecessarily heavy overhead expenses of the benefit organizations. If the Government did that effectively, there would be no need to introduce this new provision, which makes it necessary to transfer people with long-term or chronic illnesses to the special account 21 days earlier than previously. I believe that it is reasonable for us to ask for some information on this matter.

The fact of the matter is that one organization could take the place of the 188 organizations to which I have referred. If it was a public organization there would be no need for duplicated staffs or reserves, and all the money could be directed towards helping people who are sick. Whoever set out to contrive this incredibly mixed up arrangement, had he wanted to do sick people a disservice, could not have done so more effectively than by means of the existing arrangement which is being developed at such a high cost to the Commonwealth and to sick people.

We on this side of the House intend to support this proposal because we believe it is an improvement. It clears up some of the glaring anomalies which affect the aged and the chronically ill. However, we regard this as a patching-up programme. Far more desirable than this approach is the Labour Party’s approach. There is probably little need for me to elaborate, on the Labour Party’s approach, because that will be done very effectively by the Leader of the Opposition (Mr. Calwell) in the near future. We will re-introduce the old Chifley concept of free hospitalization for everybody. We will establish a proper and comprehensive Australian health service.

Mr Turnbull:

– You will nationalize the medical profession, will you?

Mr L R JOHNSON:

– No.

Mr SPEAKER:

– Order! I ask the honorable member for Mallee not to interject and thereby lead the honorable member for Hughes away from the bill.

Mr L R JOHNSON:

– Thank you, Mr. Speaker; but I doubt whether the honorable member has the capacity to do so. You have seen my capacity to keep very close to the bill this afternoon. I am quite certain that the honorable member did not mean what he said when he interjected. He knows that it is possible to introduce a system of free hospitalization which will give people a choice. If we want to provide free hospitalization for people in public wards, we will do that by assisting the States with additional grants.

Mr SPEAKER:

– Order! The honorable member is now out of order. I ask him to keep away from that matter.

Mr L R JOHNSON:

– The Labour Party hopes to contrive an arrangement under which special accounts and all the other detailed, complex and difficult arrangements no longer will be necessary. Remembering that everything in the way of hospitals and health services is paid for by somebody, we believe that it would be far better for those things to be paid for on the principle of capacity to pay ensuring at all times that if any one wants to go to a private hospital he should have the right to do so.

I support the bill. I look forward to the Labour Party taking over the treasury bench so that it will bc able to introduce a genuine national health scheme.

Mr. THOMPSON (Port Adelaide) [4.37J. - As the Minister for Repatriation (Mr. Swartz) pointed out in introducing this bill, the scope of the measure is very limited. It does not do much at all for people covered by the special account system, including people with chronic illnesses. The main objective of the bill is to remove the requirement that people over 65 years of age must be transferred to the special account. I wish to recount briefly the events that led up to the introduction of the special account system. I go back beyond the time when the Commonwealth first made payments in respect of people covered by the special account system. I shall speak about South Australia. I do not profess to understand the operations of all the funds in the other States. The mutual Hospital Association Limited was in existence in South Australia many years before the Commonwealth Government came into this field.

My first experience of the limitations of hospital benefits was when an aged person told me that he had been paying into that fund for many years, but when he went into hospital and applied to the fund for benefit, he was told, “ You are not entitled to receive benefit because you had the ailment for which you were treated in hospital before you joined the fund “. The ailment happened to be hardened arteries. The representative of the fund said: “ You are not entitled to any benefit. You are entitled to benefit only in respect of an illness or condition that you did not have when you joined the fund “. So, very many years ago, I understood the limitations imposed by that fund, which was really an insurance fund for hospital treatment. I went to see the managers of the fund. They showed me the rules and pointed out to me very clearly that the decision was in accordance with the rules of the fund. The majority of the directors of that fund were Adelaide medical men. I think the majority of the directors of that fund are still medical men. Nothing could be done about that person’s case.

Later, when other benefit societies established hospital funds, even before the Commonwealth Government came into this field, the contributions paid by members had to be sufficient to enable the fund to pay benefits when members were in hospital. Eventually, an age limit was applied to people who could join the fund, and people could not receive any benefit for preexisting complaints. Since the Commonwealth Government has come into the picture and begun to make a contribution to hospital expenses, a person, in order to be eligible for the Commonwealth payment, even under the special account, has to pay contributions to a hospital fund. That is the point on which we on this side of the House differ from the Government. We say that every person should be entitled to the same type of benefit, whether or not he pays contributions to an outside fund.

The Chifley Government introduced the payment of 6s. a day towards hospital expenses. Later that amount was increased to 8s. a day. So far as this Government is concerned, whether you were covered by the special account system or the ordinary account system, you would not get more than 8s. a day unless you joined a hospital benefit organization. Later the Government increased its contribution to 12s. a day in respect of people who contributed for fund benefit of £2 2s. a week towards their hospital expenses. Later still the Government increased its contribution to £1 a day for contributors to a fund for benefit of £5 5s. a week. A further alteration by the Government has had the result that contributors to hospital benefit organizations must pay at a rate which will entitle them to the Government contribution of £1 a day. People are paying at that rate at the present time.

With regard to the special account system, the Government said to the organizations: “ You are not taking in people over a certain age and you are not taking in people who are permanently invalided because the contributions of your members are not sufficiently high to allow you to extend membership to the aged and chronically ill and pay them full benefits. To enable you to accept these people we will establish this special account system. You can then accept everybody. It does not matter whether they are suffering from incurable complaints and are laid up. You have to take them into the hospital fund. If the cost of payment of benefits to those chronic cases exceeds their contributions, the Government will pay the balance through the special account system.” That has been done. The Minister said in his secondreading speech that over the last three or four years the Government has been paying a subsidy of about £2,000,000 a year to the special account. Under the ordinary account system the hospital benefit organization charges its member contributions which are sufficiently high to meet the cost of payment of the benefits prescribed by its rules.

Until now, contributors have had to transfer to the special account on reaching 65 years of age. The removal of this provision seems to me to be the only helpful aspect of the measure before us. Let me give you details of an actual case. A man came to mc and said: “ When 1 was in a government job I joined a hospital fund. Afterwards I joined one of the hospital fund organizations which entitled me to the government contribution. J have been in hospital and I have a bill for £22 10s.” It is some considerable time ago and I have forgotten whether the government contribution at that time was 12s. a day or £1 a day. The man said: “ My payment from the old fund plus the government contribution would have totalled about £27. When I went to the organization to collect that amount they said, ‘ We can give you only the amount of the hospital bill - £22 10s.’. I went to the Department of Health and they told mc that f could not get any more.” He had come to mc to see whether I could explain to him why he could not get any more than the amount of the hospital bill. 1 turned up the act and showed him the clause which stated that he could not get any more than the amount of the hospital bill because he was over 65.

That was my first experience of the over- 65 provision. L believe the Government was wrong in providing that contributors must transfer to the special account at the age of 65 years. This measure provides for the removal of that provision. The reason for the removal of the provision seems to mc to be to enable contributors of over 65 years to become members of two hospital benefit organizations and receive benefits from each organization plus the Government contribution of £1 a day. Contributions may be made to organizations at all sorts of rates which give entitlement to benefits from £12 a week to £30 a week, apart from the Government contribution of £1 a day. The only way that people over 65 years of agc can receive benefit plus government contribution totalling more than the actual amount of the hospital bills is to join two organizations.

This measure allows people over 65 years to become members of more than one organization. Had the man to whom I have just referred not been over 65 years of age he would have received payments totalling £27 instead of £22 10s., the actual amount of the hospital bill.

Hospital charges have risen so much that the hospital benefit organizations have been forced to raise their rates of contributions. Take my own position. I am over 65 years of age and I had to transfer to the special account on reaching 65. Although I am covered by the special account, for the first thirteen weeks I am in hospital I can get the full benefit, providing it does not exceed the amount of the hospital bill. After thirteen weeks I have to be paid, under the special account system, the standard payment of £1 16s. a day or £12 12s. a week. That is what contributors are paid under the special account after a chronic illness. But if I were 40 years of age I would receive for thirteen weeks the benefits for which I was paying and then I would have to transfer to the special account and be paid the standard rate, which the Government would subsidize. Without the government contribution to the special account we would not be able to help people who are chronically ill.

The honorable member for Hughes (Mr. L. R. Johnson) referred to age pensioners. I do not know whether I am guilty of doing the wrong thing. Pensioners in my own State have come to me about the need to join a hospital benefit organization in order to receive the government contribution. They have paid 6d. a week or 9d. a week, which has entitled the hospital to Commonwealth benefit of £1 16s. a day. The hospitals in my State said to the pensioners, “If you are contributing for that amount of benefit, that is the amount we will accept”, but the hospitals were influenced by the fact of whether the pensioners were covered by the ordinary account or special account. Pensioners said to me at the time, “ Previously we did not have to pay anything “. In the public wards of the State hospitals pensioners were treated free. This system was altered so that the pensioners had to pay at least £3 3s. a day. I advised the pensioners that the best thing they could do was to join’ a hospital benefit organization. When the alteration was made last year so that pensioners with medical cards could receive free treatment in public wards, pensioners again came to see me to find out whether they should continue paying contributions to hospital benefit organizations. The honorable member for Hughes referred to the fact that pensioners who have been paying 9d. a week for payment of the appropriate benefit and who hold medical card’s do not now have to pay hospital expenses. The Government pays 36s. a day to hospitals in respect of each pensioner treated in their public wards. The pensioners say, “ We have been paying in 9d. a week and cannot get back anything for it”. That is why the honorable member for Hughes said that a lot of pensioners are paying contributions to hospital benefit organizations from which they cannot receive any benefit. I can understand that. I have explained to the pensioners that under the act, if they do not join a hospital benefit organization because they can receive free treatment in public wards - they are mostly elderly people who would be covered by the special account - and they require treatment when they are away from home and no public ward is available, they will be forced to meet the costs of a private ward or a private hospital. I say to them, “It is difficult for me to advise you to pull out of the fund, because you might get caught away from home; you might have an accident and be taken to a hospital which has no public ward. You would then have to pay the full amount of the hospital charges.” However, generally speaking, I tell such people, “If you are around your home area all the time, and if you have to go into a hospital, in a public ward where you can get free hospitalization, just cancel the payment to the hospial fund “.

I will also say, in fairness, that the hospital fund in my own State advises people with pensioner medical cards that there is no need for them to continue paying into the fund, and those people do not make any more payments after they are so advised. There is just one other point on this aspect. I mentioned the case of the man with the hospital bill for £22 who was refused the usual reimbursement of £27 from the hospital fund. Under this bill, in cases such as this, payment would- be made out of the ordinary fund and the additional £5 would be received.

I believe this bill will provide a benefit, but only for a particular class of persons - those over 65 years of age who are paying into two funds and are entitled to a large amount. They will be entitled to full payment. The only other benefit from this bill will be conferred upon the Government itself. The changes with respect to the special account will mean that the Government will not have to make up losses in the general account. At the present time, if an approved society has a debit in general account at the end of the half year, it has to be made up from its own funds. But if there is a debit at the end of the half year in respect of the special account - if payments made exceed contributions by those paying into the fund - the Government will make up the difference. As the Minister said, the amount involved over the last three or four years has been about £2,000,000 a year.

While we may hail this bill as providing something extra, I do not look upon it as being of any great account. 1 do say that it will help those people over 65 years who want to contribute for greater benefits. Consider the position at the present time. In my own State a person used to be able to go into a hospital and pay £17 10s., £18 or £21 a week. To-day you cannot be accommodated in hospital for such amounts. You may go to a hospital where public wards are full. The doctor says you must go to an intermediate or a private ward for a very serious operation. When you get your bill you find that the amount for which you have contributed, plus the government contribution of £7 a week, does not even go close to meeting the bill. Faced with this possibility, a person may say to himself, “ The best thing I can do is to pay for a very high rate of benefit “. A married couple may pay as much as £35 a year. I forget the exact contribution for highest benefits. When a person turns 65 he is told, “ You have to go into a special account “. A married man could be penalized in this way. This bill does benefit such people.

Anomalies occur in innumerable cases at the present time. In my own case, for instance, a specialist said, “ You must have a special nurse for the first two days “. Then later there was a bit of a complication and he said, “ You must have a special nurse for another couple of nights “. The cost of the special nurse for those four nights came to about £18 1 8s. That was not included in the hospital bill. Whether I had been in a special account or not, I could not have received more than the hospital charged me because I had had to pay these extras. When you go to a hospital you are charged so much a day and you receive so much a day in return for what you have paid to your organization. I think I paid £32 10s. a week, but when I got the bill from the hospital I found that I had also to pay £8 8s. for the operating theatre on the first occasion and £10 10s. for the theatre on the second occasion.

Mr Pollard:

– Did they get anything else out of you?

Mr THOMPSON:

– Yes, they did. That was what I went there for. But I am afraid I could not explain all that here. All I can say is that the specialist did a wonderful job. I also remind the House that when you go into hospital for a serious operation you do not get the cheapest doctor available. You engage the recognized best man, and bc usually sends you the recognized best bill. But I suppose I cannot deal wilh that aspect of it because that refers to medical treatment.

I have a pretty intimate knowledge of these matters. I have had a life-long association with such organizations as friendly societies and dispensaries and I know the difficulties that arise. We on this side of the House say that the Government has completely failed. Charges in hospitals to-day are very high. In some hospitals in Adelaide you are charged 45 guineas a week, while the Government pays £7 a week. You have to pay the rest out of your pocket or get it from a fund and, after all, you have been paying your contribution* for what you get from the fund, so yo$ really pay the balance yourself.

I think we should also do something about doctors’ charges. We should be able to set a scale of charges. The honorable member for Hughes has already referred to the intolerable position of people w.ho are paying into various funds for certain benefits but who find they have to pay a good deal more for hospitalization. People can, of course, elect to pay the maximum amount to a fund. In my case I contributed to receive, not £32 10s. a week, but about £24 a week. I had to make up the balance of the hospital charge, in addition to the charges for nurses and the theatre. The Government is talking about what a wonderful job it has done. I admit that it has helped certain people in special accounts, those with chronic illnesses and those who exceed the maximum period of about three months laid down by the funds. In the special account I could get the full benefit, just as any one else could, for 91 days, and then be transferred to the standard benefit of £12 12s. a week. Once the yearly period had ended I could go back again for thirteen weeks on to the full amount of benefit that I had paid for. I would then start another year. Briefly, you can get the full benefit for which you have contributed for thirteen weeks, and for the rest of the year you would get £12 12s. a week.

I hope that honorable members will not have any illusions that this measure will provide something special for people who have joined a fund with pre-existing or chronic diseases. It will not help those people much at all. The only person that it will help to any extent is the person over 65 years of age who was compelled to transfer to a special account and was limited to receiving the amount of his hospital bill, not the amount for which he contributed. I personally think there is a little bit of benefit in the bill, although not much. I told the honorable member for Grayndler (Mr. Daly) that there was not much on which to oppose the bill because it provided some benefit for somebody. I said that the debate would provide an opportunity to enlarge on other defects of the legislation. I said it might be of benefit if we could put material before the Minister that he could think about with a view to effecting improvements. I think that until the Commonwealth is prepared to pay more than £1 a day towards the cost of hospital treatment for every patient, the people will not get a really worth-while national health scheme. Something may be done to ameliorate the problems a little - -for- example, by allowing certain contributors to receive full benefits instead of requiring them to go on to the special account. There will always be trouble until the Commonwealth pays more than £1 a day.

Labour, when in office, provided for free hospitalization. Some States have in fact provided free hospitalization in public wards, but, unfortunately, pressure has been brought to bear on them to have hospitals impose some charge on the ground that, if this were not done, Commonwealth grants made to those States on the recommendation of the Commonwealth Grants Commission might be affected. All these matters are linked with the welfare of the people.

The proposals contained in this bill will help a little, but I want the Government to go a long way further. It will have to do so before it will be able to do anything appreciably helpful for the unfortunate person who has to go into hospital. I say to honorable members that we must remember that the time when a person is in hospital is the time when he is least able to meet extra commitments, and heavy hospital expenses impose great difficulties on him. Even though a person contributes to a benefit fund in order to receive help in meeting payments for hospital treatment, the contribution made by the Commonwealth is not sufficient to ensure a fair deal.

I should like to compliment the honorable member for Grayndler on the way in which he led for the Opposition in the debate on this bill. He brought to the attention of honorable members a lot of matters related to hospitalization, and the Commonwealth’s contribution towards the cost, that should be considered earnestly. We of the Australian Labour Party played our part when we were in office. We provided that 8s. a day was to be paid by the Commonwealth for every patient in a public ward and that no charges would be imposed on patients in public wards. This Government has altered that scheme. To-day, a charge is made unless a patient has a pensioner medical card.

I point out, too, that a pensioner who earns even a little more than £2 a week income apart from pension cannot get a pensioner medical card, and, therefore, cannot receive free hospital treatment in a public ward, as was provided for under

Labour’s national health scheme. That is a point that we should consider very seriously. A pensioner may receive only £2 2s. a week income in addition to the pension and yet not be able to obtain free hospital treatment, simply because his income debars him from entitlement to a pensioner medical card. As a consequence, he has to pay the present high hospital charges. Therefore, he must insure himself with medical and hospital benefits funds if he is to receive any help at all apart from the 8s. a day that the Commonwealth pays in respect of all hospital patients.

I hope that my remarks have not been too wide of the bill, Mr. Speaker. I believe that all that I have said is linked with this whole subject. I support the measure.

Mr BUCHANAN:
McMillan

.- Mr. Speaker, 1 believe that one or two misunderstandings ought to be corrected. First of all, I should like to compliment the honorable member for Port Adelaide (Mr. Thompson) on having very capably kept to the subject-matter of the bill and demonstrated very clearly that there is one person on the opposite side of the House who knows something about our national health service. The honorable member for Hughes (Mr. L. R. Johnson) demonstrated that there were several things that he did not know about this scheme and, with your permission, Sir, I shall touch on those matters as I go along. He clearly demonstrated that he had not bothered to find out what this bill was about and, when he tried to make a speech about health matters in general, he got himself tied up with the entitlements of pensioners so much that I believe that it is not necessary even to correct what he said.

As has been said so capably by the honorable member for Port Adelaide the special account provisions were introduced to overcome difficulties posed by an insurance scheme of the type that we have adopted. We have tried, in establishing a national health scheme, to give the people something that would afford them an opportunity to cover themselves for the needs that they want to meet. This scheme has to be actuarially correct. Various aspects have to bc approved by the actuaries before benefit organizations are given approval to function. This Government has worked out a system under which, from time to time, a little more Commonwealth money is provided, but the bulk of the cost of the scheme is met by the insurance system. This is the system in which we on this side of the House believe. Opposition speakers to-day of course, have shown that their ideas on this subject are quite different. They would just hand out free treatment to anybody who goes into a hospital. I do not know whether honorable members opposite really think that such a scheme would provide for the grades and differences of treatment that are necessary. Under the present scheme, a pensioner who is really seriously ill receives treatment no different from that received by a person who, just because he happens to have money, pays very big fees. The Opposition, however, seems to think that this business of having money is the only thing that matters.

A health scheme that will give service to the people in the best possible way must be based on insurance, so that the burden can be spread and so that the money paid in by all helps those who have the misfortune to need help. It must be perfectly obvious that, in any such insurance scheme, people are more likely to want treatment and to need hospitalization as they become older. As the honorable member for Port Adelaide pointed out several times, a person could, by insuring himself in several funds, make a very great profit out of going into hospital. This is hardly fair to all those other people who, by their contributions to insurance funds, help to provide the money that is paid out to the persons who receives the benefit.

The hospital benefits scheme was brought into existence to enable people to pay their hospital accounts, not to make profits our of them. When this aspect of the scheme cropped up a few years ago, as several honorable members have pointed out, it was found that 8.3 per cent, of claims for benefits were rejected on the grounds that the illnesses concerned dated from before the time of insuring with the fund, and 1.3 per cent, were disallowed on the ground that the illnesses were chronic. These matters have been discussed from time to time in the Department of Health and with Ministers for Health. Throughout, it has been felt that something had to be done to help people in such a position. So the Government, very rightly, introduced the special account provisions. Everybody approves and agrees that this was a good thing.

These provisions were introduced on 1st January, 1959; so we have had almost five years in which to see how they operate. The funds have stated their points of view. They have pointed out the way in which they have been affected by the special account procedure. The Department of Health has pointed out that it is paying out more than £2,000,000 a year. Up to the end of this financial year, about £12,000,000 will have been paid out by the department in respect of the special account. About 365,000 people are affected. So the sum involved and the number of persons affected are not negligible. At least 365,000 people will benefit from this measure. Those are the people who in the past have had a limit imposed on the benefits that they could receive. They have not been robbed of anything, despite what honorable members opposite have said, and have not been done out of anything. Their hospital accounts have been paid, but it has been necessary for the Commonwealth to help. After due thought by ali concerned, it has been decided to do something for them.

I am disappointed in the honorable member for Grayndler (Mr. Daly). He wanted to make a speech covering the whole field of national health and, because he wanted to make election capital, he tried to rubbish the Government. He said we introduced this bill at the last moment to cover up certain deficiencies and to patch up a failing scheme. That is arrant nonsense. The history of this amendment is well known, and the honorable member for Grayndler knows the story. The funds and the Department of Health have been discussing this matter for a long time. The Minister has a committee and he asked the committee to look into it. The committee appointed a subcommittee and the sub-committee, after examining the subject thoroughly, came up with a recommendation. The honorable member knows the history of this matter as well as I do. It has not been raised just at the last minute. However, I am very glad that we have been able to bring the bill before the House before the close of the session. In the ordinary course, it would have been introduced next month. I am very glad that we have been able to deal with it. If we had not been able to deal with it this week, it would have had to wait until we returned in February of next year.

The bill is designed to help those who are over 65 years of age, and it is designed to deal only with that aspect. Discussions are still continuing on the question of the chronically ill, which was mentioned by the honorable member for Hughes. I sincerely hope that something will be done about this matter. Any one who reads the bill will see that it applies only to people over 65 years of age. They will benefit very considerably from the bill. Some mention has been made of the 21 days during which the Commonwealth will assist the funds. Negotiations were proceeding and each side came half way. The funds still cannot afford to carry the whole burden of that section of the public that is prone to illness. I would suggest that the younger section is paying a very considerable amount of money to meet the costs of the older contributors.

I rose to correct one or two suggestions that have been made and to point out to the honorable member for Hughes that he is completely off the beam when he refers to pensioners. Admittedly, 96,000 pensioners do not have medical entitlement cards, but there is a reason for this, and we all know it. The fault does not lie with the Government. However, I point out that we have over 800,000 pensioners, so those without cards represent only a little more than 10 per cent, of all pensioners. The honorable member for Port Adelaide made it appear that any pensioner with an income of more than £2 2s. would not bc eligible for a medical entitlement card. This applies only to a person who is applying for a pension for the first time. Any one who obtained a medical card when his income was under £2 would retain it if his income exceeded £2.

Mr Daly:

– What has this to do with the bill? Get back to the bill.

Mr BUCHANAN:

– The reason I mention this is that the honorable member for Hughes said that 96,000 pensioners are affected and that pensioners are obliged to belong to a fund before they can get any benefit. That is completely wrong. The honorable member knows that the Minister made it clear when the payment to the hospitals was increased to 36s. a day that a condition of the offer was that all pensioners enrolled in the pensioner medical service were to be treated without charge in public wards. Of course, as the honorable member for Port Adelaide said, they are being treated free of charge. If they go to Innamincka or some place like that, they may go into a private hospital. I do not know. However, that aspect does not arise.

Mr Daly:

– What about the 100,000 pensioners who cannot get into the pensioner medical scheme?

Mr BUCHANAN:

– There is a reason for that.

Mr Daly:

– Because they get over £2 a week.

Mr BUCHANAN:

– They come in with the people who are already making provision for health insurance, just as 1 am. The honorable member for Hughes said that, as all people over 65 years of age would be getting a pension, there would be no need for a special account. But there is a need. A lot of people over 65 years of age are still unable to make provision for their health, because they would not qualify for entry into public wards.

The honorable member for Grayndler has tried to make political capital out of this matter. He made an election speech. He became sore when he was prevented from continuing in this way and he abused the Minister. My purpose in rising is partly to correct the impression created by the honorable member for Hughes that this is the worst health scheme in the world. I want to rebut that suggestion completely. Our health scheme has been a great benefit to hundreds of thousands of Australians and 73 per cent, of our population is deriving benefit from it. From time to time, as the opportunity arises, we do all we can to make it an even better scheme, and this bill is an example of the efforts made by the Government to extend the scheme. Even so, we are going a little bit far, because our scheme is already so far ahead of all the other health schemes of which I have knowledge that I have no hesitation in saying that ours is the best.

Mr JONES:
Newcastle

.- Like the honorable member for McMillan (Mr. Buchanan), I did not intend to speak on this bill. However, I believe 1 must refute the suggestions made by you, Mr. Deputy

Speaker, when you addressed the House in your capacity of a private member representing the electorate of Isaacs, and the suggestions made by the honorable member for McMillan, who said that our national health scheme was the best in the world. Speeches such as I have beard this afternoon make me ill. This national health scheme without a shadow of a doubt is the worst scheme in the world to-day. You, Mr. Deputy Speaker, referred to the Scandinavian schemes. If the Scandinavian people were asked to accept a scheme such as ours, they would dismiss their governments immediately.

The average worker in this country today cannot afford to be sick; he cannot meet the hospital and medical costs. The cost of belonging to a fund is high. A married man pays £7 16s. a year to obtain a benefit that will cover the cost of treatment in a public ward. If such a person is admitted to an intermediate ward, as be would be in most hospitals, he would be unable to meet the cost. People seeking admission to a hospital cannot say, “ 1 want to go into a public ward “. They must go into the ward that is allotted to them. Many workers to-day accept the responsibility of paying into a fund so that they can meet the cost of an intermediate ward. They pay 6s. a week or a total of £15 12s. a year.

Mr DEPUTY SPEAKER (Hon W C Haworth:
ISAACS, VICTORIA

– Order! I draw the attention of the honorable member for Newcastle to the fact that the purpose of this bill is to amend the provisions of the act relating to the special accounts of hospital benefit organizations. The bill docs not cover the whole ambit of the national health scheme.

Mr JONES:

– With all respect to you, Mr. Deputy Speaker, you got my Irish up on this subject because when you spoke you covered a wide range of health matters. Having made those statements, I believe that you should give Opposition members an opportunity to submit their views on these subjects.

Mr DEPUTY SPEAKER:

– Order! The honorable member will continue with his speech.

Mr JONES:

– I think we are at a distinct disadvantage. You spoke on the bill and now you are adjudicating and telling us how much we can say.

Mr Daly:

– I rise to a point of order, Mr. Deputy Speaker. The honorable member for Newcastle raised a point which I think you should take into consideration. You are now in the chair. A few moments ago, you were speaking on this measure and you are now deciding points of order which you then took. Do you not think that, in order to maintain the high principles of democracy in this Parliament, you should vacate the chair and let an impartial chairman take your place to adjudicate on matters which are of great importance?

Mr CHANEY:
PERTH, WESTERN AUSTRALIA · LP

– The honorable member for Grayndler is doubting the impartiality of the Chair, and that, I think, is contrary to the Standing Orders.

Mr DEPUTY SPEAKER:

– I am in the hands of the House. If the honorable member wishes to move a certain resolution, it is within his rights to do so.

Mr JONES:

– No, Mr. Deputy Speaker. I am in agreement with what the honorable member for Grayndler said. It is a matter which you yourself have to resolve. I think the only independent chairman in the House would be the honorable member for Bonython (Mr. Makin).

Returning to the bill which deals with the special accounts system, I feel that the national health scheme is condemned, as a scheme, by the speech made by the Minister for Repatriation (Mr. Swartz), representing the Minister for Health, when he introduced the measure on the morning of 23rd October. He said -

The special account system came into operation on 1st January, 1959. Prior to that time a very substantial number of claims for hospital fund benefit had been disallowed by application of the hospital funds’ rules relating to pre-existing ailments, chronic illness and maximum annual benefits. In the year ended 30th June, 1958, for example, 8.3 per cent, of hospital fund benefit claims were disallowed by the funds’ pre-existing ailments rule; 1.3 per cent, of claims were disallowed by the chronic illness rule and 2.6 per cent, of claims because the contributors’ claims exceeded the funds’ maximum annual limit. In that year, hospital fund contributors were disqualified from hospital fund benefit for more than 1,179,000 days by rules of this sort.

The honorable member for McMillan (Mr. Buchanan) and you, Sir, had the temerity to stand up in this Parliament and say that this is one of the best - not one of the best; I withdraw that - the best national health and hospital scheme in the world to-day. How can you, Sir, justify such a statement when over 1,000,000 people were deprived of benefits by the rules laid down by these funds? To-day full page advertisements appear in the press, time is bought on radio and time is purchased on television - at a cost of about £60 a minute - in the fight between the Hospitals Contributions Fund of New South Wales and the Medical Benefits Fund of Australia, yet you had the temerity to say this is the best scheme in the world to-day! Do you realize, Sir, that prior to the introduction of this amending legislation and since the 1959 legislation was introduced, over 8,000,000 people were deprived of benefits? That legislation was introduced by a Minister whose only desire was to please the medical profession. He was not interested - nor was this Government - in providing a hospital and medical benefits scheme which would meet the requirements of the people.

Let us look at the cost of operating this scheme. In the years since the scheme was introduced - from 1951-52 to 1961-62 - the cost of administration has been £12,278,000. To that sum can be added £2,250,000, the annual cost of operating the Hospitals Contributions Fund. In all, this scheme which the Government introduced has resulted in £15,000,000 going down the drain in administration costs.

The Government says that the hospital funds cannot afford to pay increased benefits. Let us have a look at their accumulated profits. On 17th September last I asked a question to ascertain what were the accumulated profits of the various hospital funds and what were their administrative costs. The answer supplied by the Minister for Health (Senator Wade) gave the following information: -

We can add to that amount of more than £12,700,000 the cost of administration over the last year, which is near enough to £2,400,000. It can be clearly seen that the cost of administration of the benefit scheme which this Government introduced has been nearly £14,700,000. With the concurrence of honorable members I will have a table setting out the accumulated profits of the funds incorporated in “ Hansard “.

I have now placed on record the huge profits that are being built up by these organizations when they should be using their profits for the benefit of the people who subscribe to them. That is what we want the Government to do. The sooner we get rid of this system the better. I believe that the Leader of the Opposition (Mr. Calwell), in his policy speech, will include a free hospital and medical scheme for the people of Australia. The Leader of the Opposition is nodding his head, indicating that that will be the position, so Labour will get rid of this system which the Government introduced only for the benefit of the medical profession and not for the benefit of the people.

It took the Government years after the introduction of the present scheme to realize that it contained anomalies. It took the Government the best part of eight years to correct the anomaly which was corrected in 1959. It has taken the Government twelve years to realize that over the years contributors have been deprived of the right to claim the maximum amount of benefit for which they have contributed. The benefit organizations took the people’s money but, when a benefit was claimed, they said: “We are sorry. You can only receive the minimum scale which is laid down in the regulations once you become entitled to benefit because you had suffered from the complaint prior to joining the fund.”

Many pensioners and other people who were entitled to be classified as public ward patients realized that on going to hospital they were not entitled to say “ We want to go into a public ward “, or “ We want intermediate ward treatment”. They had to accept the treatment handed out to them by a hospital and go into the ward to which they were directed. In order to receive treatment by certain doctors patients have had to go into intermediate wards or private wards. Many people, realizing that they had a serious illness, had to pay the maximum rate.

Government supporters claim that the national health scheme is an excellent scheme, but it is not a form of insurance; it is a form of extraction. It is just another imposition that the Government has inflicted on people in the low income bracket. To-day a man must pay £15 12s. a year in contributions to a hospital fund if he wishes to cover himself for intermediate ward treatment. Under the scheme run by the Hospitals Contribution Fund of New South Wales even £15 12s. a year would not entitle a contributor to receive the full benefit because the present intermediate ward charge at Royal Newcastle Hospital is £33 19s. a week and the benefit paid to a contributor who insures under the 6B scale, which costs £15 12s. a year, is only £32 4s. a week.

I want to refer to some of the anomalies that exist in relation to contributions. A married contributor to the Hospitals Contribution Fund of New South Wales must pay 6s. a week in order to cover himself for intermediate ward treatment. A contributor to the Newcastle and Suburban Co-operative Society scheme, which is operated in the interests of the people, pays only 5s. 6d. a week for intermediate ward cover. Not only is the contribution under that scheme cheaper but the benefit is greater, because for 5s. 6d. a week a contributor receives a benefit of £33 19s. a week compared with £32 4s. received from the Hospitals Contribution Fund of New South Wales.

There are so many anomalies associated with the national health scheme. The sooner the. present scheme is removed from the statute-book and a scheme of free hospitalization introduced, the better. People should be able to enter hospital without the nagging fear of having to meet the cost of their treatment. The figures cited by the Minister in his speech clearly show that more than 1,000,000 people a year are being deprived of benefits for which they have contributed. In their remarks this afternoon the honorable member for Isaacs (Mr. Haworth) and the honorable member for McMillan were playing politics. The Government which those honorable members support has introduced this legislation at this late stage in the hope that honorable members opposite might save their hides at the election on 30th November next. But this legislation will not save honorable members opposite. The Government’s record in social services is shocking. The Government has been prepared to give to the people only what the people have been able to force from it. The Government will not help the people if it can possibly avoid doing so. This bill will not save Government supporters. They and their Government will be defeated on 30th November next.

Question resolved in the affirmative.

Bill read a second time.

Message from the GovernorGeneral recommending appropriation announced.

In committee:

The bill.

Mr ROBERTON:
Minister for Social Services · Riverina · CP

– I refer to clause 5, which reads -

After section eightytwoc of the Principal Act the following section is inserted: - “82ca.- (1.) Where-

the rules of a registered organization provide for a maximum number of days of hospital treatment during a year or other specified period in respect of which an ordinary contributor is entitled to hospital fund benefit; and

hospital fund benefit becomes payable to an ordinary contributor in respect of any days that fall within the last twentyone days of that maximum number of days, the organization may elect to treat the contributor as having become a special account contributor on any day that is included in the days in respect of which the benefit is so payable and, if it so elects, shall, subject to section eightytwoG of this Act, credit to its special account the contributions by or on behalf of that contributor in respect of the week in which that day is included and all subsequent weeks. “ (2.) The regulations may provide that the last preceding sub-section shall operate as if there were substituted for the reference to twentyone days a reference to such other number of days as is prescribed.’”.

I move -

In proposed section 82ca (2.) omit “other”, insert “lesser”.

Attention has been directed to the fact that proposed sub-section (2.) could have an effect somewhat different from that intended. The intention is that there should be power to reduce by regulation the number of days before the end of the funds’ normal maximum benefit period during which they may elect to treat the contributor as a special account contributor.In its present form the clause would enable regulations to be made increasing the number of days from the 21 initially fixed. Should circumstances arise where this number of days should be increased the intention is that a change in this direction should be made by an amendment of the act. If the amendment I have proposed is adopted, sub-section (2.) will read -

The regulations may provide that the last preceding sub-section shall operate as if there were substituted for the reference to twentyone days a reference to such lesser number of days as is prescribed.

Mr DALY:
Grayndler

.-I have listened to the explanation given by the Minister for Social Services. I take it that 21 days will be the maximum the period could not be longer but it could be less than 21 days. Will that be the case?

Mr Roberton:

– Yes.

Amendment agreed to.

Bill, as amended, agreed to.

Bill reported with an amendment; report - by leave - adopted.

Third Reading

Bill (on motion by Mr. Roberton) - by leave - read a third time.

page 2336

AIR ACCIDENTS (COMMONWEALTH LIABILITY) BULL 1963

In committee: Consideration of Senate’s amendments.

Clause 4

In this Act, unless the contrary intention appears - “ passenger in relation to an aircraft, does not include -

  1. a member of the crew including a pilot of the aircraft;

  2. a member of the Defence Force. whether a member of the crew of the aircraft or not, who-

    1. is in receipt of flying pay;or
    2. is included in a prescribed class of members of the Defence Force;

  3. a person whose carriage in the aircraft is for the purpose of his performing in the aircraft -

    1. duties or services for the performance of which he is employed or engaged by ‘ the Commonwealth or a Commonwealth authority; or
    2. duties as a member of the Defence Force;
  4. a person employed by a person other than the Commonwealth or a Commonwealth authority and whose carriage in the aircraft is for the purpose of his performing in the aircraft duties or services on behalf of his employer; or
  5. a person who is not lawfully entitled - to be on board the aircraft.

Senate’s amendment No. 1 -

In paragraph (b) (ii) of the definition of “ passenger “ after “ Defence Force “ add “, being a class as to whom the GovernorGeneral is satisfied that the terms and conditions of their service include provision of risks arising out of the performance of duties in aircraft.”

Senate’s amendment No. 2 -

In paragraph (c) of the definition of “ passenger “ after “is” insert “specifically and only “.

Senate’s amendment No. 3 -

Leave out paragraph (d) of the definition of “ passenger “, insert the following paragraph: - “(d) a person whose carriage in the aircraft is specifically and only for the purpose of his performing duties or services in the aircraft; or “.

Mr HAROLD HOLT:
Treasurer · HigginsTreasurer · LP

– Some minor amendments to the bill have reached us from the Senate. The bill was passed by the Senate subject to minor amendments to the definition of “passenger” in clause 4. The amendments suggested themselves in the course of debate. The amendments as they reach us were designed in co-operation with the Parliamentary Draftsman in order to define more precisely those persons who are to be excluded from the definition of “ passenger “.

The amendment to paragraph (b) is designed to ensure that the only members of the Defence Force who may be prescribed are those whose salary does not include flying pay as such but which contains an element for similar purposes. The amendment to paragraph (c) is intended to make it clearer that the paragraph is confined to what might be termed airborne workers and could not be applied, for example, to exclude a member of a defence force who is flying purely for the purpose of transport from place to place. The amendment to paragraph (d) is to ensure that a selfemployed person performing duties in an aircraft is excluded in the same way as an employee of a private contractor.I move -

That the amendments be agreed to.

Mr WHITLAM:
Werriwa

.- As the Treasurer (Mr. Harold Holt) has pointed out, these amendments arose from the debate in the other place. The amendments are necessary to elucidate some matters in the bill. The second and third amendments seem to elucidate matters quite satisfactorily. The first of these, however, seems to obfuscate the position rather than elucidate it. I cannot believe that this amendment is good drafting. It certainly is not neat drafting and I do not believe that it is clear drafting. Let me strip it to its simplest form. As it left this House the definition of “ passenger “ did not include, among others, a member of the defence force who is included in a prescribed class of members of the defence force. If the amendment made in the other place and now proposed by the Treasurer is adopted the definition will read - “ Passenger “… does not include a member of the Defence Force . . . who is included in a prescribed class of members of the Defence Force being a class as to whom the GovernorGeneral is satisfied that the terms and conditions of their service include provision tor risks arising out of the performance of duties in aircraft.

I would not cavil at the wording if the words “ the GovernorGeneral is satisfied that “ were omitted. I do not see what clarification or what purpose is achieved by adding those words.

Mr Harold Holt:

– Some one has to be in a position to say whether they come within the category. This is the simplest way of doing that.

Mr WHITLAM:

– I would doubt that it is the simplest way. The act ought to be understood, if possible, without external references. Regulations made under the act should also be understood,- as far as possible, without external references. If one omits the reference to the Governor-General being satisfied then it is a matter for passengers or prospective passengers or the survivors of passengers to make up their own minds as to their eligibilities and it is up to the Commonwealth under this act to decide its liabilities, but if one makes these eligibilities or liabilities depend on the satisfaction of the Governor-General an imponderable element is inserted.

Earlier this month the Senate moved to omit similar words in the International Organizations (Privileges and Immunities) Bill. It will be remembered that when the bill left this place it included the following clause referring to the International Court of Justice -

Hie regulations may confer upon - such privileges and immunities as are required to give effect to the Statute of that Court and such privileges and immunities in respect of acts and things done in the course of the performance of their functions in connexion with the business of that Court as are, in the opinion of the GovernorGeneral, required to give effect to any resolution of, or convention or agreement approved by, the General Assembly of the United Nations.

In the other place in a division, in which some Government supporters voted with members of the Australian Labour Party, the words “ in the opinion of the GovernorGeneral “ were omitted. When the amendments were transmitted to this House for its concurrence the Prime Minister (Sir Robert Menzies) acting at that time as AttorneyGeneral stated -

The amendments adopted by the Senate would delete the words “in the opinion of the GovernorGeneral “ and the Government is prepared to accept this amendment.

Mr Harold Holt:

– Let us not have a long debate about this. I am not pressing it. It only means that the bill will have to go back to the Senate for further amendment. If you think that is worth doing to achieve your purpose I will accept your suggestion.

Mr WHITLAM:

– If the Treasurer will accept the omission of those words then without further ado we shall accept the amendments.

Mr HAROLD HOLT:
Treasurer · Higgins · LP

– I move -

In Senate’s amendment No. I, omit “the Governor-General is satisfied, that “.

That portion of the definition of “passenger” now will read - being a class as to whom the terms and conditions - of their service include provision for risks arising out of the performance of duties in aircraft.

Amendment upon Senate’s amendment No. 1 agreed to.

Senate’s amendments, as amended, agreed to.

Resolution reported; report adopted.

page 2338

WESTERN AUSTRALIA (NORTHERN DEVELOPMENT) AGREEMENT BILL 1963

Bill - by leave - presented by Mr. Harold Holt, and read a first time.

Second Reading

Mr HAROLD HOLT:
Treasurer · Higgins · LP

– I move -

That the bill be now read a second time.

I announced in the Budget speech that (he Government, in the belief that the development of the northern part of Western Australia called for a level of special expenditure higher than that arising from the commitments we had already undertak;n, had decided to offer Western Australia a further provision of £3,500,000 for expenditure during the next three years. The Government of Western Australia has since accepted the offer, and the bill now before the House seeks the approval of Parliament to an agreement between the Commonwealth and the State for the provision of further Commonwealth financial assistance for the purpose in the period up to 30th June, 1966. The agreement, as set out in the schedule to the bill, provides that the further £3,500,C00 will be applid primarily to the construction of a new jetty at Broome, in deep water, and to the construction of further irrigation works within the first stage of the Ord River irrigation project. There is also provision for the financing of such other works as may be agreed, within the available amount of £3,500,000 in the northern part of the State, that is, the part of the State that is north of the twentieth parallel of south latitude.

The new jetty at Broome, which is to ;e of steel and concrete construction similar to the jetty now being built at Derby, will serve the dual purpose of replacing the present wooden structure, which has the disadvantages of being costly to maintain, unusable by motor transport, and inaccessible at low tide, and also of providing the west Kimberley area with a deep water port available at all times to local and overseas shipping. As the potential of the area is developed there will be a growing need for improved sea transport facilities, and the new jetty at Broome should meet this need for many years ahead.

As the Broome jetty will be a revenue earning State asset, and as the State will be saving considerable sums otherwise needed for maintenance of the old structure, the assistance in this case is to be repayable, as to 50 per cent of the total funds provided, over a period of fifteen years from December, 1966. Interest, at the longterm bond rate applying when each payment is made by the Commonwealth, will be payable by the State every six months on the outstanding balance of the repayable amount. This is a similar arrangement to that operating in the case of the new jetty at Derby. Firm cost estimates for the work are not yet available, but it is probable that this work will absorb up to £1,500,000 of the £3,500,000.

The other works for which specific provision is made in the agreement are the Ord irrigation project works. These works comprise those needed for the supply of irrigation water to and drainage of the remaining farms to be served by the water stored in the newlycompleted diversion dam on the Ord River. The diversion dam storage, which was officially opened by the Prime Minister (Sir Robert Menzies) in July last, has the capacity to irrigate approximately 50 farms of 600 acres each, a total of 30,000 acres. Five farms are already in operation, and a further seven have been allotted by the Western Australian Government. The assistance to be provided under the agreement will be applied by the State to the remaining irrigation and drainage works required for development of the whole area of 30,000 acres.

As was the case with respect to the assistance already provided by the Commonwealth for the Ord River project, the assistance under the agreement will take the form of a grant and will not be repayable by the State. Although firm cost estimates will not be available until contracts are let, it is expected that the Ord irrigation project works will absorb up to about £1,750,000 of the total provision of £3,500,000.

After allowance is made for expenditure of up to £1,500,000 on the Broome jetty project, a relatively small amount is expected to be available for other projects in the area. Under the agreement, it will be open to the State to propose other projects for financing from the remaining funds available within the provision of £3,500,000. The measure before the House will undoubtedly make a further major contribution to development of the remote northern area of Western Australia. Taken in conjunction with the Commonwealth assistance already being provided for other projects, it will also operate to step up significantly the scale of Commonwealth expenditure on special projects within the area. In the five years to 30th June, 1963, the Commonwealth provided a total of £6,500,000 for the Ord River project, improvement of the Wyndham jetty, investigation of the NapierBroome Bay area, beef cattle roads and commencement of construction of a new jetty at Derby.

With the £3,500,000 now to be provided, and the provisions of £2,250,000 for beef cattle roads and £500,000 for completion of the Derby jetty for which legislation has already been passed, the Commonwealth will be providing a total of £6,250,000 over the three years commencing with the current financial year. The annual average of special Commonwealth assistance is thus being increased from £1,300,000 to almost £2,100,000 an increase of the order of 60 per cent. These figures provide an indication of the importance attached by the Government to development of the area and evidence in concrete and tangible form of what it is doing in recognition of that importance. I have much pleasure in commending the bill to the House.

Debate (on motion by Mr. Beazley) adjourned.

Sitting suspended from 5.54 to 8 p.m.

page 2340

ASSENT TO BILLS

Assent to the following bills reported: -

Loan (Housing) Bill (No. 2) 1963.

Commonwealth Banks Bill 1963.

Stevedoring Industry Bill 1963.

Appropriation Bill 1963-64.

Appropriation (Works and Services) Bill 1963-64.

Submarine Cables and Pipelines Protection Bill 1963.

Wine Overseas Marketing Bill 1963.

Disabled Persons Accommodation Bill 1963.

Crimes (Aircraft) Bill 1963.

page 2340

DAIRY PRODUCE EXPORT CONTROL BILL 1963

Second Reading

Debate resumed from 24th October (vide page 2271), on motion by Mr. Adermann -

That the bill be now read a second time.

Mr SPEAKER (Hon Sir John McLeay:
BOOTHBY, SOUTH AUSTRALIA

– Is it the wish of the House that the suggestion of the Minister be adopted? There being no objection, that course will be followed.

Mr POLLARD:
Lalor

.- The Dairy Produce Export Control Bill is a relatively small one. It is designed to effect changes in the constitution of the Australian Dairy Produce Board. The board is one of Australia’s export control boards and is of very great importance to the dairy producers. For many years, under the powers conferred on it by this Parliament, the board has exercised control and a guiding hand over the export and sale of Australian dairy products overseas. In addition the board has had an interest in, and indirect powers in, the marketing of butter, cheese and other dairy products within Australia. Naturally this government instrumentality works in very close co-operation with the Dairy Industry Equalization Committee.

The Opposition will support the measure, which contains provision for the appointment of a permanent deputy chairman. The reason for the appointment is that the work of the present chairman Mr. E. G. Roberts, O.B.E., of Victoria is of such an onerous character that by the appointment of a deputy chairman Mr. Roberts will have more time available for very necessary visits overseas, for more attention to detail and for the overall supervision of the marketing of dairy products. I do not doubt that the appointment is warranted. Mr. J. P. Norton of Western Australia is to be deputy chairman, and in the absence of Mr. Roberts he will act as chairman.

Several recent happenings, apparently, have made this change necessary. One of them was the unfortunate death of Mr. Hedley Clark who, for many years, played a most valuable part in the work of the Australian Dairy Produce Board, particularly in relation to promotion and research. His death caused a great loss to the industry. I do not think it is an exaggeration to say that the establishment of the Australian Dairy Produce Board represents a greater advance for the dairying industry than is to be found in other primary industries. Prices for Australian butter, cheese and other dairy products for export have reached a relatively low level on overseas markets when compared to the prices of the war and immediate post-war periods. Despite the fact that this Government underwrites a total return of at least 40d. per lb. for commercial butter sold on the home market, sales on the overseas markets at prices lower than 40d. per lb. mean that the returns to the dairy farmers are substantially reduced.

Legislation introduced by a Labour government once ensured that the dairying industry operated under a guarantee of payment of a found cost of production figure, not only on butter and cheese consumed within Australia but also in respect of exports of those products. The prices which obtained during the war disappeared after the war. With the passage of some years prices for butter exports fell substantially below the prices charged to the Australian people. As time went on the position became even worse and the dairy farmers are now confronted with a guaranteed price of 40d. per lb. for home consumption butter whereas in 1948-49 they were paid the then found cost of production for all their butter. The price of 40d. per lb. is only the underwritten price. Anything else that the dairy farmers can scratch out of the Australian market and the overseas markets is theirs. It is ironical that over the last three years dairy farmers have not received a net return of more than about 44d. per lb. Involved in that overall return from all markets is the Government subsidy amounting to about 6d-d, per lb. The found cost of production in Australia to-day is assessed at approximately 4s. 8d. per lb. The dairy farmers are receiving 3s. 8d. per lb. The rather shocking position is that the best return that the dairy farmers can get out of a subsidy of £13,500,000- about 6£d. per lb. for locally consumed butter - plus the London price, plus the return they receive from extra sales on the Australian market is ls. per lb. less than the found cost of production. This situation is worrying everybody in the industry. I am quite sure that it has been a headache to the Minister for Primary Industry (Mr. Adermann). It became such a headache, and the dairy farmers were so clamorous for a better deal, that in 1959, I think, the Government in desperation appointed Mr. McCarthy-

Mr. SPEAKER__ Order! I point out to the honorable member for Lalor that we are dealing with administration only so far as it concerns the Australian Dairy Produce Board. I ask the honorable member to relate his remarks to the bill and not to continue dealing with the general problems of the industry.

Mr POLLARD:

– I think you are dead right, Mr. Speaker. I will finish off my passing reference. The appointment of the Dairy Industry Committee of Enquiry was an endeavour to find a solution to the dairy farmers’ problems. Unfortunately the recommendation of the committee, even though it would have solved the dairy farmers’ problems, was not accepted by the government of the day and they are still left to their own devices.

In conclusion, I say that the Opposition welcomes the bill. The Opposition will do anything it can to assist the dairy farmers of Australia, and this is a small measure that may assist in a small way. We will do anything we can to see that dairy farmers receive a price for their product which bears a closer relationship to the cost of production than competent authorities have found to be the case with prices now being received.

Question resolved in the affirmative.

Bill read a second time.

Third Reading

Leave granted for third reading to be moved forthwith.

Bill (on the motion by Mr. Adermann) read a third time.

page 2341

DAIRY PRODUCE RESEARCH AND SALES PROMOTION BILL 1963

Second Reading

Consideration resumed from 24th October (vide page 2271), on motion by Mr. Adermann -

That the bill be now read a second time.

Question resolved in the affirmative. - Bill read a second time.

Third Reading

Leave granted for third reading to be moved forthwith.

Bill (on motion by Mr. Adermann) read a third time.

page 2341

PHOSPHATE FERTILIZERS BOUNTY BILL 1963

Second Reading

Debate resumed from 24th October (vide page 2298), on motion by Mr. Fairhall -

That the bill be now read a second time.

Mr POLLARD:
Lalor

.- The bill now before us provides for the payment of bounty on the production of certain phosphate fertilizers. On behalf of members of the Opposition I can say that we are all for the provisions of this bill.

Mr Peters:

– But you inspired the bill.

Mr POLLARD:

– As a matter of fact I delivered the rural policy speech in 1961 on behalf of the Parliamentary Labour Party. I promised that certain things would be done if Labour was returned to power. I said -

You will remember the Curtin and Chifley Labour Governments paid a subsidy on superphosphate. The Menzies Government abolished this subsidy payment. A Labour government will restore subsidy payment at the rate of £3 a ton on superphosphate and at related payments-

I ask the members of the Country Party to listen to this - on nitrogenous, potassic, mixed and other types of fertilizers, including trace elements. Subsidy would be payable on all purchases on and after 1st January, 1962. This assistance will help farm development policy, promote increased production on a wide range of export produce and provide the building up of farming strength necessary to cope with adverse marketing conditions, if Britain joins the European Common Market.

That was Labour’s 1961 election promise. The Labour Party has always been interested in and has believed in the efficacy of the use of artificial fertilizers in the agricultural and pastoral areas of Australia. To bc quite fair, I think it was an antiLabour government that introduced and paid for a time a superphosphate bounty at a low rate. That was back in the 1930’s. But in due course the anti-Labour government abandoned its baby, and no superphosphate bounty was being paid when Labour took office in 1941. The Curtin Government introduced a bounty at the rate of about 25s. a ton. By 1950 the rate had increased to 50s. a ton. In the year when Labour was defeated, the Labour Government actually paid £3,656,770 in superphosphate subsidy.

Increased use of superphosphate was desperately needed at that time, and of course a continuation of the superphosphate subsidy was just as desperately needed. But the reactionary MenziesFadden.McEwen combination took office and, lo and behold, in 1 950 it wiped the superphosphate bounty legislation off the statute-book. As late as 1960, 1 think, when Senator Wright in another place raised the question of introducing a subsidy on superphosphate, Senator Paltridge said -

Having conferred with the Treasurer about this mutter, 1 am now able to say that one of the many proposals which came up for discussion when the 1961-62 Budget was being framed was the introduction of a subsidy on superphosphate. After careful consideration of all aspects of the proposal it was, however, decided to take no action in the matter. As the current usage of superphosphate in Australia is approximately 2,000,000 tons per annum, the annual cost of a subsidy would be £2,000,000 for every £1 of subsidy.

That was the view expressed by Senator Paltridge in reply to Senator Wright. Over a long period of years most competent authorities on agricultural production have urged the Government to pay superphosphate bounties. No less reliable and notable a citizen than Sir John Crawford made a statement within recent years about the necessity for and the value of applying artificial fertilizers to the soil, and about the justification, even in the monetary sense, for paying a subsidy to encourage the farming community to use more of this valuable product. Mr. Simpson, who was chairman of the soldier settlement authority of Victoria, from time to time made simliar statements. The Victorian wool and wheat growers’ organizations have urged the introduction of legislation for the payment of superphosphate bounties. Officers of the various government departments, when consulted from time to time, have been quite emphatic on the value of increasing the use of superphosphate.

I have in my hand a document headed “ Superphosphate “. It was produced in about 1947. It discusses the value of superphosphate. I think it was prepared by our good friend Mr. McCarthy, who was chairman of the Dairy Industry Committee of Enquiry. He concluded with these remarks - and this was fourteen or fifteen years ago -

There is no single action that the Commonwealth can take that will do more towards helping our developmental policy, including that of helping to build up the fertility of our soil and correct erosion, as will result from the use of subsidy to check rises in the price of so essential a commodity as superphosphate.

Since 1950, this Government has done nothing about the matter. When the present Minister for Trade (Mr. McEwen) introduced the measure that abolished the subsidy on superphosphate, he stated that he believed that the subsidy was unnecessary. Mr. R. C. Wheeler, who was then member for Mitchell, said that the farmers could well do without it. The honorable member for Farrer (Mr. Fairbairn), who is now Minister for Air, said that a bill had been prepared for the initial introduction of a superphosphate bounty by the Government that preceded the Labour Government that took office in September, 1941.. However, it was the Labour Government that introduced a subsidy on superphosphate. We arc glad to sec that this Government has now seen the light, and, on the eve of an election, made a death-bed repentance and introduced the measure that we are now considering.

Let us consider superphosphate and Australia’s capacity to produce sufficient for its needs. Not long after World War I., the United Kingdom, along with New Zealand and Australia, was given a mandate over Nauru and Ocean Island. Those islands were valuable because they produced large quantities of phosphate rock, which was itself valuable because all the soils of the world are deficient in phosphoric acid. The nations that took over the joint mandate were wise enough to indulge in a little socialism. They created a body known as the British Phosphate Commission, composed of representatives of Australia, New Zealand and the United Kingdom. That commission supplies raw phosphate rock to all the concerns in Australia that manufacture superphosphate, as well as to New Zealand and, to a lesser degree, to Great Britain. If it were not for the ownership by that public authority of the rich deposits of phosphate rock that it controls, the lot of Australia’s farmers would no doubt be to pay a good deal more in fertilizer costs then they pay now. lt is interesting to note that superphosphate cannot be obtained from phosphate rock without ample supplies of sulphuric acid with which to render the rock into workable condition for application to the land. We in Australia, at the end of World War 11., and even during the war, faced the problem of ensuring that we could import sufficient sulphur, of which at that time we had no known natural deposits and only small local production, with which to make the sulphuric acid that we needed to render phosphate rock into workable condition. Imports of sulphur were obtained in limited quantities from the United States of America, where the greatest sulphur deposits in the world exist subterrancously, and from Africa. If 1 had lime to tell the story of how sulphur is obtained from the bowels of the earth, 1 would do so.

Through most of the war, we were thrown back on our own limited resources and we had to encourage and help the mining companies and processors of minerals to extract the sulphur content from pyrites so that we could burn it to make sulphuric acid. The struggle was terrific. In my rural policy speech on behalf of the Australian Labour Party in 1949, I undertook, if Labour was returned to office again to take action to assist the big companies, which had deposits of pyrites, mostly in mining dumps, to construct the necessary conversion plants for the manufacture of sulphuric acid. To do justice, 1 think I ought to say that the present Government came to the rescue and give those big mining companies some financial assistance to ensure that, whatever future emergencies might occur, we would at least have available sources for the production of sulphuric acid.

This bill is a good one, but it does not measure up to the requirements of the Opposition. Before I tell the House why, let me say something about the operations of the great combines that have been the manufacturers of these artificial fertilizers. In 1919, when f was a youngster, I found that I had the choice of buying my superphosphate requirements from Cuming Smith and Company Limited, Nobel (Australasia) Proprietary Limited and another company the name of which 1 have forgotten for the moment.

Mr Thompson:

– Was it the Mount Lyell company?

Mr POLLARD:

– I. thank my friend for reminding me. The third company was Mount Lyell Fertilizers Limited. 1 could take my pick of those three companies, every one of which charged exactly the same price and every one of which paid its local agent at the rail siding exactly the same commission. I had means of finding out, and did find out merely by a fluke, that they had a very tight association and that any member who departed from the fixed price or who paid to the local siding agent a commission lower than had been decided on was heavily penalized - in fact, was fined up to £500 for an offence. That was a combination to maintain prices against the interests of the primary producers of this country.

Let us have a look at something else that transpired. The farming community in Australia later realized what was going on and some mighty bright gentlemen got to work and created a company known as the Phosphate Co-operative Company of Australia Limited, which to-day manufactures fertilizers under the “ Pivot “ brand. Any man who has taken shares in that company knows ‘‘hat at the end of the season he receives a handsome bonus on every ton of fertilizer that he buys from the company. No man can measure the indirect benefit that the farmer obtains from the fact that that co-operative company stands as a lion in the path of the proprietary fertilizer manufacturing companies which are exploiting the farmers.

So effective has the “ Pivot “ company become that, within the last two or three years, the three companies that I named before - Cuming Smith and Company Limited, Nobel (Australasia) Proprietary Limited and Mount Lyell Fertilizers Limited - merged to form a company known as Commonwealth Fertilizers and Chemicals Limited. This made the former arrangement tighter still. However, we learned recently that there has been another merger. Commonwealth Fertilizers has combined with Imperial Chemical Industries of Australia and New Zealand Limited. So the whole show is tied up with only one lion standing in the path - the Phosphate Cooperative Company of Australia Limited, which manufactures under the brand name of “ Pivot “. It is a pity the primary producers of Australia arc not helped more frequently by this Government not only in buying the things that they need to buy but also in selling the commodities that they have to sell.

The point I wanted to make is this: Within recent years, progressive farmers, with the aid of the wonderful scientists of the Commonwealth Scientific and Industrial Research Organization and the officers of the various Departments of Agriculture, have discovered the types of fertilizers that will give the most beneficial results when applied to various soils. Formerly, some farmers thought that superphosphate was adequate, but merely by observing the colour of the grass that grows after superphosphate has been applied, it is possible to say that the paddock is deficient in potassic fertilizers, and in due course potash is applied.

The catch is that this bill provides for the payment of a subsidy only in relation to superphosphate. Potassic fertilizers are becoming more and more necessary every day. Superphosphate to-day costs about £13 10s. in Victoria- I speak subject to correction - and potassic fertilizer could cost anything up to £10 or £15 a ton. It so happens that a combination of 50 per : cent, superphosphate and 50 per cent, potash gives the fertilizer that is required by a wide range of primary producers. However, the Government’s bill provides that if a farmer buys a bag of mixed fertilizer - say, 50 per cent, superphosphate and 50 per cent, potash - he receives a subsidy only on the superphosphate and he receives nothing for the potash. A fairly wide range - not extensive but fairly wide - of other fertilizer mixes is used by farmers, but no subsidy is paid on any fertilizer other than superphosphate. The farmer who is fortunate enough to have a property that requires only superphosphate receives a subsidy of £3 a ton, but the farmer in the adjacent district - or even the adjacent farm - who requires 50 per cent, superphosphate and 50 per cent, potash at the much more extravagant price does not get any subsidy on the potash.

Mr Barnes:

– If you go to Queensland, you will not want either fertilizer.

Mr POLLARD:

– There is no doubt that in the eyes of the honorable member for McPherson, Queensland is a paradise; but the catch is that no one can get a block of land in Queensland because the honorable member for McPherson has it all cornered.

Let us carry the example I have given a little further. We have now discovered the advantages of trace elements such as copper, zinc and molybdenum. The rate of application of some of these trace elements is only 6 ounces to the acre, but with others, such as copper, 42 lb. to the acre may be needed. The fertilizer is bought with the trace elements mixed in it. The honorable member for Canning (Mr. McNeill) is wagging his head. He will have an opportunity presently to tell us what he knows about this subject. The unfortunate man who has to use fertilizer with, say, 42 lb. of copper in it does not get any subsidy on the copper content.

Mr Howson:

– How much does that cost?

Mr POLLARD:

– It varies with the amount you buy, but copper and zinc are pretty dear.

This state of affairs is unjust and unfair and ought to be rectified. . In my policy speech in 1961, I promised that, if Labour were returned to office, the subsidy would apply in related amounts not only to superphosphate but also to other forms of artificial fertilizer. I expect that the Minister will tell me that the administration of such a scheme would be very difficult. The other day, I obtained a copy of the list of “ Pivot “ artificial fertilizers for this season. It is a limited list. Most of the mixtures arc fairly standard and their prices arc listed. It is not very hard to work out mathematically the proportion of fertilizers in the mixes. To make it easy, 1 would suggest that a flat rate of £3 a ton apply to all fertilizers by weight, irrespective of the value of the potash or trace element content. If this were done, those people who are compelled to use these mixtures would get something. This subsidy is a late bid for votes at the election. Nevertheless, we bless it.

Mr Turnbull:

– It was in the Budget.

Mr POLLARD:

– But you had the election cooked up when you delivered the Budget. If this concession had not been in Labour’s last policy speech, the Government would never have granted it. When the bill abolishing the superphosphate subsidy was introduced, the Minister said in effect that we did not need the subsidy any more. Apparently it was not needed, right up to the time that Senator Paltridge refused a request made only recently by Senator Wright. It was the foresight of the Chifley Labour Government that ensured that the exhaustion of the Nauru and Ocean Island deposits would not mean that Australia was absolutely bereft of sources of phosphate. We bought the rights to the phosphate deposits on Christmas Island at a cost to the Government of £3,000,000. This Government - I always give due credit to my political opponents - went a step further when the opportunity arose and took over sovereignty of the whole island. I compliment the Government for doing so, but I remind the House that the initial step was taken when the Labour Government bought the phosphate rights at a cost of £3,000,000 in 1939, 1 think.

I want to mention another matter. It is not beyond the bounds of possibility that in this vast continent of ours, much of it yet unexplored, there may well be deposits of valuable rock with a very high phosphate content. The Government ought to encourage people to search for these deposits. My colleague the honorable member for the Northern Territory (Mr. Nelson) showed me some rock to-day. lt looks like phosphate and may well hold the promise of a valuable discovery. I admit that many years ago I used some ground phosphate from a deposit in Victoria, lt was ground so finely that I could not push it through the runs in the drill. It simply flowed through my hands and no benefit from its application was ever evident. I tried it, but it went off the market, lt may well be that in other parts of Australia there are huge deposits that may ease our minds about our future when the existing deposits arc exhausted.

We very willingly support the bill. We ask the Minister whether he is impressed with the injustice of depriving people other than the users of superphosphate of a bounty payment. We ask him to move an amendment that will make the bounty applicable to other fertilizers.

Mr Malcolm Fraser:
WANNON, VICTORIA · LP

– The honorable member for Lalor (Mr. Pollard) has just made a thoroughly reasonable and considered speech on this measure. He has led for the Opposition in this debate and I compliment him on the attitude he has taken. The measure before the House has quite clearly been framed to ensure that not only Australia’s present superphosphate needs but also its future needs will be met. Those who have read the Minister’s second-reading speech will know that the measure caters not only for the present 20 per cent, or 22 per cent, superphosphate, which is commonly known as “super”, and which will attract a £3 a ton subsidy, but also for the double or 40 per cent, superphosphate and the 50 per cent, superphosphate which a company in New South Wales and another in Victoria will produce in the not too distant future.

As the Minister pointed out, the payment of a subsidy on these more highly concentrated forms of superphosphate will not involve increased Government expenditure. They will attract the subsidy on fertilizer value, at the same rate as the 20 per cent, superphosphate. The 40 per cent, superphosphate will attract a subsidy of £6 a ton and the 50 per cent, a subsidy of £7 10s. a ton. I think honorable members will agree that that is as it should be. Although these other superphosphates are not yet on the market, they will be available within a short space of time. I venture to say that the move undertaken by these companies in New South Wales and Victoria will force all manufacturers of superphosphate to produce these more highly concentrated forms. I think the reason for this is evident. Except for those users who are very close to the production centres, the freight saving on double and triple superphosphate will be great. In fact, the freight charge for the double superphosphate will be precisely half the charge for the present 20 per cent, superphosphate. In addition, there will be savings in spreading, which can be very expensive. In rough country, where air spreading has to be used, the cost is about £3 a ton. Air spreading costs in such country will be reduced dramatically. These new superphosphates clearly would not have been placed on the market and the companies concerned would not have been able to go ahead with their plans if all superphosphates had attracted a bare £3 a ton subsidy and if the definition of “ superphosphate “ had been left as rough and crude as it was. So the Government has foreseen what is going to happen and has met the position admirably.

The story of what superphosphate can do and has done for Australia is now becoming a very old story. It is an old story in country which could carry only half a sheep to the acre and which can now carry three, four, five or six sheep per acre. But this does not make the story any less true or less spectacular. The use of superphosphate has in recent years been responsible for a great increase in the number of stock held in Australia. However, there are still great reserves of land which would benefit from applications of superphosphate but whose owners, for reasons best known to themselves, do not at present use it. The production from that land has been held down to a much lower level than it would otherwise reach. At the moment we carry between 150,000,000 and 160,000,000 sheep in Australia. I believe it is no exaggeration to say that Australia is quite capable of carrying 250,000,000 sheep, with a consequent great increase in production and export earnings. If we are to achieve that level, it can be done only by the increased use of superphosphate. Inasmuch as the subsidy announced by the Government helps towards attaining that end, it is not only doing something to reduce farmers’ costs where they need to be reduced, but also is assisting in achieving a very worthwhile national objective. That, again, is something which all honorable members will applaud. It is true that not all farmers use superphosphate and not all graziers use it, but it is true that the farmers with the highest cost of production, as shown in surveys by the Bureau of Agricultural Economics, are those in the high rainfall areas, who have improved their properties and who inevitably have to use large quantities of superphosphate if their production is to be maintained or to remain at a high level. They are the ones who most need assistance. They have been experiencing low prices and, to some extent, rises in costs, although it will be noted that in the last year or two prices have improved and costs have remained stable. The subsidy will assist those in the rural industries who most need help.

The honorable member for McPherson (Mr. Barnes) said by interjection that not very much superphosphate is used in Queensland. That is true at the moment, but the wider use of the new legumes and Townsville lucerne and other developments which are taking place there may - and I think will - mean that superphosphate will do more for Queensland than it has done for either Victoria or New South Wales. There is a tremendous potential for increased production. If the Queensland farmers, under the progressive Government which that State now has, can be persuaded to use superphosphate, that will be of tremendous advantage to Australia. This subsidy will obviously assist in ensuring greater use of superphosphate in that State.

The honorable member for Lalor mentioned the source of supplies of phosphate. He referred to steps taken by previous governments and also by the present Government, in its early days of office, to increase supplies of phosphate for Australia by obtaining supplies from Christmas Island in addition to Nauru. It is true - it will be even more true now that the subsidy is available - that the reserves of phosphate rock on Nauru and Christmas Island will not be sufficient to meet Australia’s needs indefinitely. We may find, with the increased consumption stimulated by this measure, that we will have to draw on supplies of phosphate rock from other sources before three years are passed. I am advised that it may be necessary to import a high-quality phosphate rock from Florida within one or two years. It used to be thought that Australia had, at Nauru and Christmas Island, reserves of phosphate rock very much cheaper than that available in other areas, but 1 understand that modern mining techniques - if that is the proper term - which have been developed in Florida have greatly reduced production costs in the United States and that phosphate rock from Florida can now be imported into Australia at a cost not much greater than that of rock from Nauru and Christmas Island. This underlines the degree of Australia’s dependence on overseas supplies of a fertilizer which is of vital importance to our continued production and which will play an essential part in any efforts which may be made to increase production.

I believe the Government will certainly do what it can to s’ep up the search for high-quality phosphate rock in Australia. If supplies of phosphate rock could be discovered in this country, they would result in a tremendous saving. It would be very satisfying indeed to discover phosphate rock reserves in this country sufficient to last indefinitely. As I have said, I believe it is quite certain that the Government will do what it can to step up the search for phosphate rock in Australia.

Many honorable members have been anxious that this measure should be introduced, because they are keenly aware of the position of the farmers in the areas they represent. In this regard, the work done by my friend the honorable member for Barker (Mr. Forbes) comes immediately to my mind. I know that the honorable member for Indi (Mr. Holten), the honorable member for Corangamite (Mr. Mackinnon) and the honorable member for Gippsland (Mr. Nixon) have pushed and worked very hard to see this subsidy introduced.

I am reminded that the honorable member for Canning (Mr. McNeill) also has urged the introduction of this subsidy. I think honorable members may be gratified that the Government has made its decision in such a generous and realistic way. At present levels of consumption the subsidy will cost the Government about £9,000,000 a year. That figure will apply for a consumption not far short of 3,000,000 tons a year but it is my belief that the subsidy will encourage consumption to rise quickly to 4,000,000 tons a year. That increased consumption will result in increased production, which is an objective of a great number of farmers as individuals and the overall objective of the Government as well.

It goes without saying that the effects of the subsidy will be very far-reaching. Not only will the subsidy reduce farmers’ costs and assist to increase their production but it will also increase the volume of production that Australia has for export and thus will enable us to earn more overseas funds. If we increase our overseas earnings we will be able to step up to some degree our general rate of growth and industrialization, which is to a large measure dependent, as everybody knows, on the overseas funds that the rural industries earn.

I place on record mv support and that of one or two of my colleagues who will not take part in the debate, for this measure, which has been very warmly received and which is so very worth while.

Mr BRIMBLECOMBE:
Maranoa

– Like the honorable member for Wannon (Mr. Malcolm Fraser) I, too, listened with great interest to what the honorable member for Lalor (Mr. Pollard) said about the subsidy on superphosphate. The honorable member for Lalor demonstrated that he has a very wide knowledge of fertilizers.

Early in his remarks the honorable member said that the present Minister for Trade (Mr. McEwen) was responsible, when he was Minister for Commerce and Agriculture, for removing the subsidy on superphosphate. The honorable member for La.’or endeavoured to show that there was no valid reason for lifting the subsidy and that by doing so an injustice was inflicted on primary producers. What is the purpose or objective of a subsidy or a bounty? In my opinion, and, I think that of most people, a subsidy or bounty is paid, to tide a particular industry or person over a bad period when the industry or the individual is in straitened circumstances. Let mc liken the subsidy to the unemployment benefit. The unemployment benefit is paid to a man only so long as he remains out of work. ‘When an industry is prosperous there is no valid reason for continuing the subsidy or bounty. That is why the subsidy was lifted years ago. At that time prices in the wool industry, which uses 50 per cent, of our superphosphate production, were high. The industry was prosperous. The wheat industry also was prosperous. At that time the overall picture did not justify the continuance of the subsidy or bounty. There were valid reasons for lifting the subsidy.

A subsidy is like a tariff. You apply a tariff to protect an industry. When the industry gets on its feet and is able to carry on in a businesslike way and make profits, you vary the tariff. The argument adopted by the honorable member for Lalor falls to the ground because it has no validity or substance. This is generally realized by the majority of the people. Would the honorable member for Lalor continue to pay the unemployment benefit to a man after he obtained work? Of course he would not! In principle, the unemployment benefit is no different from a subsidy. I leave the matter there. The average person will have been able to follow my very simple argument and, I think, will agree that the subsidy was lifted years ago for good and valid reasons.

As I have never used superphosphate - I hardly know what it looks like - honorable members may wonder why I rise to speak in this debate. I point out to the House and to the honorable member for Wannon in particular that Queensland has not been lagging in research as far as superphosphate is concerned. The Queensland Department of Agriculture and Stock and the Commonwealth Scientific and Industrial Research Organization have conducted various experiments and to date they have been able to demonstrate that no great advantage would be derived from using superphosphate in Queensland. About 2,300,000 tons of superphosphate is used each year in Australia but of that amount only 21,000 tons is used in Queensland. We need nitrogenous fertilizers in that State more than we need any others. If we could get more nitrogenous fertilizers we would be the envy of most other States.

Only the Ukraine and Texas in the United States of America have areas where the soil is similar to that of the area where I live. There is an old saying that instead of using superphosphate to improve our soil in Queensland we should be exporting our soil to the southern States. It is nitrogenous fertilizers that we need in Queensland. I agree with the honorable member for Lalor that more research is needed to find out where fertilizers are required. It is all very well for the honorable member to make what is virtually a policy speech. It is all very well for him to say that a Labour government would do this and that. The honorable member knows very well that before a Labour government would be prepared to do anything about granting subsidies for the use of fertilizers it would require a lot of research to be carried out. As a practical farmer he knows that the research would be necessary. He was speaking purely for election purposes. I do not blame him for doing that.

The honorable member for Lalor said that in introducing a bounty of £3 a ton on superphosphate the Government had stolen Labour’s policy. The honorable member and his colleagues know very well that a subsidy on superphosphate has been included in the policies of every party in this House. Labour does not have a monopoly of that policy. We pay a subsidy or a bounty when and where it is required to tide people over a bad time.

I do not intend to delay the House but I do make a plea that something be done to encourage the greater use of nitrogenous fertilizers in Queensland. If you, Mr. Speaker, will allow me to get away from superphosphate for a moment and refer to nitrogenous fertilizers I would like to say something about a Queensland expert who visited the United States of America to investigate nitrogenous fertilizers. This young man had done some research in this field. He comes from the Darling Downs, in Queensland. A few months ago he returned from the United States, where he had visited California, Texas, Kansas, Indiana and other parts studying the use of nitrogenous fertilizers. He returned firmly convinced that the Darling Downs has more to gain from the use of nitrogenous fertilizers than from any other fertilizer. He stated that in America nitrogenous fertilizers were very cheap. He has applied the knowledge that he gained in America to the property that he runs in conjunction with his brother. They grow about 1,050 acres of wheat every year. They are growing about that quantity this year and they have applied nitrogenous fertilizer to the soil at the rate of 40 lb. to the acre. They are quite satisfied. They have increased their production and have improved the quality of the wheat and other crops that they have grown. In addition, because the nitrogen deficiency in the soil has been made up they are carrying more stock. This young man recommends that the powers that be should at least consider extending this subsidy to nitrogenous fertilizers. At present we receive a subsidy of £2 a ton on sulphate of ammonia which costs £29 a ton whereas we receive a subsidy of £3 a ton on superphosphate which costs £13 a ton. The subsidy is not com.sensurate with the cost of the nitrogenous fertilizers and with the benefits to be gained by their use. If (he subsidies were brought more into line more of the nitrogenous fertilizers would be used, the returns to the farmers would be higher and our country would be a lot better off.

A field day is to bc held to-morrow on the Darling Downs on a Commonwealth experimental farm which is being run in conjunction with the New South Wales Department of Agriculture. It has been demonstrated that with the application of nitrogen to the soil 100 bushels of highprotein wheat can be produced to the acre. The field day will be a practical demonstration of how production can be increased, costs reduced, a better return obtained for the grower and the nation benefited. 1 rose to participate in this debate only to correct the statement made by the honorable member for Lalor and to criticize the statement made by the honorable member for Wannon about the use of superphosphate in Queensland. His argument can be combated by the field and research officers. I leave it at that. I ask the Government to investigate this matter further to see whether the fertilizer subsidy cannot be extended to nitrogenous fertilizers.

Mr BEATON:
Bendigo

.- I join this debate only briefly to support the honorable member for Lalor (Mr. Pollard).

Mr Nixon:

– Little Sir Echo.

Mr BEATON:

– Perhaps not so little. As the honorable member for Lalor has said, the Opposition supports this bill and the principle of a superphosphate subsidy. Our great regret is that the Government has not seen fit to go a little further, as the Opposition suggested it should a long time ago, and extend the subsidy to trace elements and other fertilizers. Honorable members who have studied the situation in primary industry know that trace elements are playing a tremendously important part in increasing rural production, lowering costs and enabling new territory to be won and turned into land which plays its part in increasing our production.

It is hard for me to understand the approach and the mentality of members of the Australian Country Party. 1 am reminded of speeches which are made during the debate on the Budget and on the estimates in which Country Party members almost danced with glee about this subsidy and other measures. We heard a lot about wool promotion and so on. In an endeavour to learn something about this approach, and the mentality of members of the Country Party, I turned up the “ Hansard “ report of 5th December, 1962. On that date the honorable member for Lawson, (Mr. Failes) made the following statement: -

This is plain humbug.

That is quite a good note on which to start -

The amendment proposed by the Opposition represents an attempt to bribe the producers, not with Commonwealth money, as it may appear, but with the producers’ own money. Most graziers pay pretty heavy taxes, and, as a result of the increase

Id taxes that would be necessary to meet the cost of Labour’s proposals, the graziers will really be paying the cost themselves.

That is an extract from the report of a speech made by the honorable member for Lawson on the Wool Industry Bill following an amendment which the Opposition proposed in relation to wool promotion. The honorable member said in effect that the graziers, not the Government, would be paying the cost. It is rather remarkable to note the attitude of the honorable member for Lawson and his Country Party colleagues to a subsequent similar proposal by the Government only a week or two ago. If they really believed in their own argument they would state quite clearly that the grazier, not the Government, is paying for this subsidy out of his own pocket. The honorable member for Lawson spoke about humbug. I rather think that the humbug emanates from the Country Party benches.

There is no question that the measure now before us will assist our primary industries. The Opposition recognized this when it introduced the proposal into its policy a long time ago. This is another of those occasions when we have witnessed political piracy. Once again the Government has pinched our policy. I agree that this subsidy will increase productivity because it will enable the farmer to use more superphosphate than he has used in the past and accordingly it will assist to develop and increase our export income. Surely that is badly needed. In the last thirteen years during which this Liberal and Country Party Government has presided over Australia we have had a trading loss of something like £2,000,000,000 which includes invisibles such as insurance and freight. We have made up the deficiency by borrowing overseas and by allowing foreign investment in Australia. Surely we need to increase our export income in view of this Government’s record.

This subsidy will assist to lower the cost structure within the farming community. Honorable members, even members of the Country Party, will be aware that the farming community is caught in a squeeze between high costs of production on the one hand and ever-lowering prices on the other hand. The ordinary farmer has been caught in a squeeze for a number of years. Honorable members on the Government side might not like to hear this, but the truth is that only the Menzies-McEwen Government is to blame for this squeeze. We have only to go back to 1949 and remember that great promise to put value back into the £1. It is apparent to all that, these days, the value of the £1 is much less than it was in 1949. The cost of production of butter in 1949 was 2s. 2d. per lb. To-day according to the Division of Agricultural Economics, it is 4s. 8d. per lb. There has been a tremendous increase in the costs of production in primary industry. This must be laid at the door of the Menzies-McEwen. Government.

Other sections of the community will also benefit by this subsidy. Obviously, it will assist the railway departments because there will be an increased need for rail transport. It will increase farm incomes. It will increase employment in rural industries. The argument was put forward by the Labour Opposition a long time ago that the benefits which accrue from this subsidy eventually will return to the community and the Government, because increased incomes bring about increased taxation. So the money that is spent by way of the subsidy returns to the fold. As an indication of how this subsidy can reduce costs, let me say that I understand that fertilizer represents about 29 per cent, of the cash cost of farmers growing wheat in Western Australia. This bounty of £3 a ton on superphosphate will reduce the wheatgrowers’ cash cost by 5 or 6 per cent. So it will make a contribution to the lowering of costs.

I support the measure but, as a member of the Labour Opposition, I regret that the Government has not gone far enough to cover the all-important trace elements and other fertilizers. That defect will be remedied after 30th November. One of the reasons why I speak on this measure is that in 20 or 30 years’ time the deposits of phosphate which Australia has needed and has made great use of for many years will be near depletion. At that stage, if Australia and its rural industries are to progress and prosper, we will have to find a substitute fertilizer or a new avenue of obtaining supplies. I have in my hand some phosphate rock which was dug out of central Australia only a few da’ys ago. The point I make is that it will be essential for Australia to discover some economic deposits of phosphate rock. I understand that surveys are being made at the moment; but the ordinary fellow who goes out into the bush and looks for gold or other minerals could not care less about phosphate because he knows that if he discovers it he cannot possibly develop the find himself. At present no reward is given for the discovery of economic deposits of phosphate rock. Some action should be taken in this regard. The Federal Government could well afford to offer about £50,000, or whatever might be appropriate, as a reward to individuals who can discover economic deposits of phosphate rock, so that the rural industries of the future will be safeguarded. This rock came from central Australia.- The deposits from which it came could be economic.

Mr Kelly:

– Exactly where did it come from? Was it riot the Northern Territory?

Mr BEATON:

– Somewhere in the Northern Territory, yes. I am not at liberty to say exactly where. I believe that the Government should offer a reward so that individuals will go out and look for this rock which is of tremendous importance to the Australian economy. We know that in 20 or 25 years’ time the supplies that we have now will not be available to us. Accordingly, I suggest that some action be taken to initiate a search for phosphate rock in order to safeguard our future.

Mr WILSON:
Sturt

.- I am sure that every member of this House welcomes the introduction of this Phosphate Fertilizers Bounty Bill. I congratulate the Government and the Ministers concerned on its introduction. I also congratulate them on the alteration of the title and scope of the bill. Normally, such a bill is referred to as the Superphosphate Bounty Bill, but honorable members will note that this is the Phosphate Fertilizers Bounty Bill. We all know that Australian soils are deficient in phosphorous. We all know of the marvels that have been worked as a result of the application of phosphates to Australian soils. We also know that, whilst superphosphate is beneficial to most soils, some soils require cither additives to superphosphate or phosphate administered in other forms. This bounty will assist the primary producer tremendously in reducing his costs. It will enable him to compete on world markets more effectively than has been possible in the past. In addition, to some extent it will restore the balance of profitability between the primary industries and the secondary and tertiary industries.

Whilst I whole-heartedly support this bill and realize its tremendous importance to Australia, one clause in the bill and one passage in the second-reading speech made by the Minister for Supply (Mr. Fairhall) have caused we very great concern. I refer to the following statement by the Minister, as reported at page 2297 of “ Hansard “: -

Representations have also been made on behalf of rock phosphate as a fertilizer when used in a finely ground or calcined state. However, research by the Commonwealth Scientific and Industrial

Research Organization and State Departments of Agriculture, although indicating the possibility of these products being useful on certain soils, has not reached the stage when authoritative advice can be given to the user that these products provide economic and efficient sources of phosphate. For these reasons’ the Government has decided that these products should not be bountiable at this point of time.

When I heard that statement, I was extremely concerned that, on a lack of evidence - not on evidence to the contrary - the manufacturers of rock phosphate fertilizer used in a finely ground or calcined state should be denied the bounty at this stage. The Minister made it perfectly clear that the value of phosphorous comes from its solubility, in what is described as ammonium citrate soluble phosphorous pentoxide. The Minister said -

The fertilizer value of superphosphate is measured by its soluble content of phosphorus pentoxide, usually expressed as P-0:. lt is on this PlO* content that the payment of the bounty will be based.

No one can quarrel with that statement. On 15th October, 1963, the Minister for Customs and Excise (Senator Henty) made a press statement along the same lines, in that statement he said that the proportionate bounty would be payable on ammoniated superphosphate, ammonium phosphate - which I do not think is a superphosphate at all - superphosphate containing trace and other elements and other like products, all of which contain less than 19.5 per cent. P203 soluble content. In South Australia two companies manufacture phosphate fertilizers. These fertilizers are highly regarded for many soils. Following the Minister’s press statement the companies felt they were entitled to receive an amount of bounty proportionate to the soluble P2Ob content of their products. Although the companies’ products conformed to the definition in clause 3 of the bill I found that in clause 5 they were excluded by the words defining products entitled to bounty as “superphosphate or ammonium phosphate “.

I feel that as the bounty is to be paid for the benefit of the growers they should have the right to say which kind of phosphate fertilizer is most beneficial for their soils. The bounty should be paid according to the P205 content of the fertilizer, in accordance with the bill. It does not seem to me to be sufficient ground to exclude the products of those two companies because the Commonwealth Scientific and Industrial Research Organization has not sufficiently tested them. However, after studying my reports the Minister has stated that he is prepared to give to the House an undertaking that an immediate investigation will be made by the C.S.I.R.O. in the field and with the growers. If the fertilizers produced by the two companies prove to be as successful as the companies claim they are - and I am sure that they will - their eligibility for payment of the bounty will be placed before the Government.

The two companies to which I have been referring are Wooltana Industries Limited and Research Industries Limited. Wooltana Industries Limited has 40 permanent employees and at times has a substantial number of casual employees. It produces a phosphate fertilizer which it supplies to 2,000 satisfied growers. Its turnover is £200,000 per annum and it sells approximately 15,000 tons of fertilizer a year. At present this company has a most encouraging export business for its fertilizer. It has signed contracts with Japan for the sale of 12,000 tons of fertilizers which are not identical with their phosphate fertilizer but are suitable for the requirements of Japanese primary producers. Its fertilizer contains 9.15 per cent, of soluble phosphorus pentoxide measured by the citrate test. That is the normal test used in Australia for superphosphate. The soluble phosphorus pentoxide content of standard superphosphate is approximately 20 per cent. The phosphate fertilizer manufactured by Wooltana Industries Limited, unlike superphosphate, is made from wholly Australian material and is manufactured by Australian workers. It is made out of a phosphate rock mined at Angaston, in South Australia, beat treated and combined with a humus obtained from the sea near Wingfield, South Australia. It is similar in composition to a phosphate fertilizer which is used extensively in England and which is eligible for a superphosphate bounty in that country. According to the manufacturer the phosphate used has definite advantages in many soils. In soils with high acidity the addition of superphosphate can do more harm than good. The phosphate included in the product of Wool tana Industries Limited is non-acid and I understand that it has most spectacular results in certain areas.

I want to thank the Minister for the undertaking that he has given to me to-day that the Commonwealth Scientific and Industrial Research Organization will immediately conduct an investigation in the field and with practical farmers and that the Government will reconsider the eligibility of the company’s product if the subsequent report is satisfactory. I feel sure that it will be. 1 turn now to Research Industries Limited. This company has 20 permanent employees and a number of seasonal employees. It commenced manufacturing in 1947. Since 1956 it has used phosphate rock mined at Kapunda for the manufacture of fertilizers. About 40 per cent, of the farmers in the areas around Mount Barker, Echunga, Lobethal and Woodside use this company’s products. They are found to be very satisfactory, whereas superphosphate has proved unsatisfactory because of the extreme acidity of the soils in those areas. The main factor in the success of the phosphate fertilizer produced by Research Industries Limited has been the use of basic, neutral, subacid or reverted forms of phosphate. It is clearly undesirable to add acidic fertilizers such as superphosphate to soils which are already excessively acid, even though the addition of phosphate is necessary. This company also claims that the bounty should be payable according to the P2Ob content.

I cannot quite understand how the C.S.I.R.O. can have made the report referred to in the Minister’s statement, in view of its previous reports. I refer to the C.S.I.R.O. report No. 42 of March, 1963. On page 12 of that report the following appeared.

The heavy demand for phosphorus by new pastures is usually met by applying large dressings of super. This method, although supplying the required amount of phosphorus, adds unnecessarily lange amounts of sulphur to the soil. It is an inefficient fertilizer technique.

This is the C.S.I.R.O. report, and it goes on - superphosphate containing a higher content of A more rational approach would be to use a

That is. a sub-acid super., or a mixture containing ground phosphate rock, which is exactly what is contained in these two products that I have referred to.

In the publication “ Rural Research “ of the C.S.I.R.O., No. 36 of June, 1961, the following appears at page 16: -

Experiments carried out in Canberra by Mr. K. D. McLachlan, of the Division of Plant Industry, and at Katherine by Mr. W. Arndt and Mr. L. J. Phillips, of the Division of Land Research and Regional Survey, . . . (show that) . . . rock phosphate may be a suitable alternative to super, for certain crops and soils in the wetter districts . . . Mr. McLachlan’s experiments extending over a period of seven years, were located on acid soils near Canberra, and were designed to compare both the initial and residual values to pasture of super, and rock phosphate . . The total production over a period of seven years was of the same order per unit of phosphorus applied, irrespective of the fertilizer used … A mixture of the two fertilizers produced a response equal to that of super, alone and had a higher residual value. The conclusion from these Canberra experiments is that, where it is intended to apply fertilizer in large amounts at infrequent intervals, there may be little to choose between rock phosphate and super . . . The Katherine experiment was commenced in 1953 and is not yet completed. As at Canberra, these northern Australian experiments . . . indicate that rock phosphate has a higher residual value and is to bc preferred where the fertilizer is applied infrequently. At the end of four years the rock phosphate plots had a clear advantage over those which received super. Mr. F. J. Hingston of the Division of Soils has shown that much of the phosphorus in superphosphate is leached from the surface horizons in sandy soils in Western Australia.

  1. hope honorable members from Western Australia will take particular note of that. The report concludes: - lt is possible that the less soluble phosphorus in rock phosphate may withstand these leaching c (leets.

In view of those reports of the C.S.I.R.O. I believe that there is no evidence at the moment to justify the exclusion of these two companies from the bounty. The companies ask for only the same benefits as are provided in the case of ammonium phosphate, in respect of which a bounty will be paid on the soluble P»03 content.

The undertaking given by the Minister now obviates the necessity for me to take action in other directions. I would like to thank the Minister for that undertaking. I hope that the C.S.I.R.O. will act promptly in this matter. I hope that next week its officers will be in the field, because I know that Wooltana Industries Limited is having field trials in the Warooka district on Yorke Peninsula at the present time, and I know that the farmers there have tried superphosphate, which has been found to have no effect whatsoever, and also this other product, which has given most beneficial results.

This bill was designed to assist farmers who use phosphate fertilizers, and it should not be limited to the fertilizer combine, certain fertilizer manufacturers or Imperial Chemical Industries of Australia and New Zealand Limited. The bounty should be payable to all manufacturers who produce a phosphate that can be used by plants to give results such as those that have proved so spectacular throughout Australia. I support the bill and welcome it because ‘ I am sure that it will do a tremendous amount of good for primary producers.

Mr ANTHONY:
Richmond

.- I rise, as have other members, to give support to this provision for a bounty of £3 a ton on superphosphate. I must congratulate the honorable member for Sturt (Mr. Wilson) on his learned and knowledgeable speech on fertilizers, making particular reference to the phosphoric content of various kinds of phosphate fertilizers. It is very pleasing indeed to see a man who is not as closely tied to rural industries as are other members, taking such a genuine interest in the matter of fertilizers. I. was very pleased to hear his reference to the use of phosphates in wetter areas, where the Ph content of the soil is much lower than it is in other areas of Australia. I was interested also to hear his remarks about the work of the Commonwealth Scientific and Industrial Research Organization, when he stated that using monophosphates is just as good as using diphosphates, because the acidity in the soil did the necessary breaking down and you did not need sulphuric acid to produce this result.

Mr Nixon:

– That is where rainfall is heavy.

Mr ANTHONY:

– Yes, I referred to areas of heavy rainfall and high acidity. I want, first, to rebut some statements made by Opposition speakers. I wish to counter the statement that this Government was most cruel in abolishing the superphosphate subsidy which had been introduced in the early 1930’s and had continued, with varying degrees of support, until 1950. This Government did eliminate the superphosphate subsidy in 1950 because the prima: y industries which were then receiving the benefit of the subsidy were in quite a prosperous state.

Mr Pollard:

– That is when you used to tell us they were all ruined and broke because of the Chifley Government.

Mr ANTHONY:

– The honorable mcmfor Lalor suggests that we said primary industries were not prosperous at that time. We all remember that at that time the world price of wool had risen considerably. The Menzies-Fadden Government, when it came to office, brought in a reliable stabilization scheme for the dairy industry, giving dairy producers a price which was recommended to cover the cost of production. It brought in a guaranteed wheat stabilization scheme as well. These two great schemes were introduced after consideration had been given to the fact that if the superphosphate subsidy were removed the producers would still obtain increased prices for their products. There is no justification, therefore, for saying that we were unfair in our dealings with primary producers.

What is the whole object of a bounty or a tariff or a subsidy? It is to help a person or an industry when there is need to give help. But surely you will not continue to give that help after the problems have been overcome. If a person becomes unemployed there is a need to give him help. But when he gets a job you do not continue to give him unemployment relief. Tariff protection is given to an industry so that it can stand on its own feet. . After the industry begins to make substantial profits do you continue to give it tariff protection? Of course not! A similar argument applied in 1950 when the superphosphate bounty was eliminated. However, there was an occasion in about 1.952 when the supply of sulphuric acid from brimstone became rather short. World supplies of brimstone were then thought to be limited and the only way to overcome the problem and to assure supplies of sulphuric acid to manufacturers in Australia was to encourage the use of pyrites in the production of superphosphate here. This Government then paid a bounty on the production of sulphuric acid from pyrites mined in Australia totalling about £500,000 a year. That bounty has been continued up to the present time and is still paid. This has been done, as I have said, to ensure continuous supplies of sulphuric acid for the production of superphosphate.

We have made firm contracts with the British Phosphate Commissioners to ensure that we get a substantial proportion of supplies of rock phosphate from Nauru and Ocean Island, and with the Christmas Island Phosphate Commission to ensure supplies from there. I have studied the calculated supplies at these places and calculated how long they will last. According to my calculations, if the present rate of use of superphosphate continues these deposits will last little longer than 20 years. But I am not over-much concerned about that, because it is known that the reserves of rock phosphate throughout the world will meet the demand over the next 1,000 years. I believe that many more deposits will be found throughout the world.

Mr Beaton:

– Would not the honorable member like to get supplies at home?

Mr ANTHONY:

– Of course 1 would, because we would then have assured supplies in case of other sources being cut off in an emergency. Furthermore, we would save foreign exchange. I have every confidence that sources of rock phosphate will be found in this country. The honorable member for Bendigo (Mr. Beaton) said earlier that he had a sample of rock phosphate found in Central Australia. 1 have also heard - I believe it is true - that extensive deposits of rock phosphate have been found in Queensland by a company that has sought permission to export to other parts of the world, because most of the users of rock phosphate in Australia are tied to supplies from the British Phosphate Commissioners. I believe that, if this is true, every effort should be mai’e to determine the extent of the deposits in Queensland and, if possible, to start developing them in conjunction with supplies from Nauru, Ocean Island and Christmas Island.

I read in a newspaper recently, Mr. Deputy Speaker, a statement by a Labour supporter to the effect that when Labour went out of office it was paying a subsidy of £5 a ton on superphosphate I am sure that everybody will agree with mc that that statement is not true. 1 have the figures here. The highest subsidy that the Labour Government ever paid on superphosphate was £2 19s. 7d. a ton. That was in the financial year 1944-45. In 1949-50, when it went out of office, it was paying subsidy at the rate of £2 7s. 7d. a ton.

Mr Pollard:

– That was the winding-up period.

Mr ANTHONY:

– Those were the averages of the subsidy paid in each financial year. This Government is paying a guaranteed amount of £3 a ton. We would all like it to be higher. Even at the present rate, the cost is something like £9,000,000 a year a very considerable sum. Members of the Australian Country Party in this Parliament have been pressing for many years for a subsidy on superphosphate, particularly those members who represent dairying and woolgrowing areas. The wheatgrowers would like the benefit, too. They know, however, that the cost of superphosphate is taken into consideration in the determination of the price that they receive for their wheat. So no great consession to them is involved. But a subsidy on superphosphate is of great importance to woolgrowers and dairy and cattle farmers.

I value greatly a subsidy on superphosphate. My electorate is one of the most difficult dairying areas in Australia. I live in an area that has been for many years a traditional butterproducing area. To-day, the north coast of New South Wales produces 60 per cent of the butter produced in that State and 14 per cent of the total Commonwealth production. Unfortunately, the area has not received the benefit of the application of scientific knowledge and research. We have not been able to increase our production by improving pastures and pasture management to the same degree as has been done in the southern parts of Australia. This has presented a major problem to the dairy industry in New South Wales. Dairy farmers on the north coast realize that if the subsidy onbutter and cheese were increased above the present level of £13,500,000 a year, there would not be any substantial benefit to the north coast of New South Wales, because the great bulk of the additional subsidy would go to the more southern parts of Australia and would only further stimulate production there, making the overall position of dairy farmers in the north of New South Wales more difficult still.

On the north coast of New South Wales, we have a very enthusiastic and hardworking group of men who form the North Coast of New South Wales Dairy Industry Research Council. They are representative of the New South Wales Agriculture Department, the Australian Dairy Produce Board, which is contributing funds, the University of New South Wales, the Commonwealth Scientific and Industrial Research Organization, the Australian Cattle and Beef Research Committee, which is contributing funds for the solution of the problems of the district, and dairy factories and organizations throughout the entire area from the MacLeay River north to the Queensland border. These men have got together to organize orderly research in an effort to overcome the problems of the dairy industry in that part of New South Wales. They need more money to see their job through and, at present, they are asking the State Government, the Australian Dairy Produce Board and the Commonwealth Government to channel more money into the area so that they can get on with their job. I give them my utmost support in trying to obtain as much finance as they need to enable them to get on with the job and find the necessary solutions.

I believe that the improvement of pastures on the north coast of New South Wales presents the biggest economic problem there. If a good, strong and prosperous dairy and cattle industry could be developed there, the effects would be reflected throughout the towns and villages in the area. Instead of a drift of population to the cities, rural population would build up. I am pleased to be able to tell the House of some of the work that has been done in efforts to improve pastures. Research workers have been working for about ten years on the problems of introducing suitable legumes to build up the nitrogen content of the soil, and their efforts are beginning to bear fruit. They have now discovered various methods of growing these legumes. Research has revealed the absence of certain trace elements whose presence is now known to be necessary. Suitable legumes have been discovered. These can be grown, at various times of the year in various areas and climates. The valuable introduction of what are known as summergrowing perennial legumes and vetches has now filled important gaps in the supply of nutritious feed. These are quite new on the north coast of New South Wales. A whole new theory of dairy farm management will have to be developed if these crops are grown. It is quite obvious that to establish these legumes considerable quantities of superphosphate, as the chief fertilizer element, will be necessary.

The grant of this subsidy by the Government will help to reduce the cost of superphosphate and this will encourage more farmers to use it. They will then be able to try some of the new plants that have been tested and proved in the area. The use of the new legumes have brought us to the stage where we have just about broken through in our efforts to solve our nutritional problems on the north coast of New South Wales. The north coast is basically fertile, has a high rainfall and good weather conditions. Plants should have a tremendous growth there and production in the area could be quite astounding. The superphosphate subsidy will help tremendously in the important period that is immediately before us. It will encourage farmers to grow the new types of legumes.

The honorable member for Bendigo said, “ It is all right to give this superphosphate subsidy but what about a subsidy for trace elements?” I believe that this is Labour’s policy.

Mr Pollard:

– Why not? What is wrong with it?

Mr ANTHONY:

– Let us consider how important it is. The most important trace element throughout most of Australia is molybdenum. In my area, we need 6, 7 or 8 cwt. of superphosphate per acre to obtain the maximum response. We need 2 ounces of molybdenum per acre to get a response. Which is the more important - to give a subsidy on molybdenum or a subsidy on superphosphate? If a further subsidy is decided upon, I suggest it be a further subsidy on superphosphate. We do not need to worry about, the minor quantities of trace clements.

Mr Pollard:

– What about potash?

Mr ANTHONY:

– Yes, I would like to see a subsidy on potash. Of course I would. At the moment, the Government is paying a subsidy on two of the major elements. It is subsidizing nitrogen in the form of sulphate of ammonia and now it is subsidizing phosphate in the form of superphosphate. The honorable member for Lalor (Mr. Pollard) interjects and asks why we do not pay a subsidy on potash. I would like to see a subsidy paid on potash, but I believe the subsidies on the other two elements are more important. At this juncture, not a great deal of potash is used throughout Australia in comparison with the use of nitrogen and phosphate. However, as time goes on, it may be necessary to pay a subsidy on potash. If such a subsidy is granted, I will support it, because I know that as time goes by potash will be of increasing importance.

Last year, the Government paid a bounty of £2 a ton on the production of sulphate of ammonia. This was of considerable help to the producers of sulphate of ammonia, but it is interesting to learn why the subsidy was granted. When the Government eased import licensing in 1960, there was a free inflow of urea and other nitrogenous fertilizers into Australia. When import licensing was removed, the price of Japanese urea - I do not have the exact figures with me, but I will not be far wrong - dropped from about £73 a ton to £59 a ton, and the cost of German urea dropped from about £84 a ton to £66 a ton. It is quite obvious that, whilst import licensing was operating, the Australian producers of nitrogenous fertilizers were being sheltered behind an artificial barrier and that the Australian consumers of nitrogenous fertilizers were paying the price. The cost of urea from japan has now dropped to about £48 or £49 a ton. This shows clearly that when import licensing was eased the primary producers, particularly those in the vegetable and fruit industries and the sugar cane industry, were able to obtain nitrogenous fertilizers much more cheaply than they had before. This was most important. But Labour’s attitude was that import licensing must continue. If it had continued, the primary producers would have had to keep on paying £70 or £80 a ton for urea from Germany and Japan.

As urea and sulphate of ammonia are inter-related, the fall in the price of urea had an effect on the price of sulphate of ammonia. The price of sulphate of ammonia was forced down. The Australian producers of this fertilizer asked the Government for emergency assistance and this assistance was granted. A duty was imposed on imported nitrogenous fertilizers. The Tariff Board conducted a full inquiry and recommended that the best procedure would be to pay a bounty of £2 a ton for sulphate of ammonia. This would allow nitrogenous fertilizers to flow freely into Australia. 1 mention these matters to show that we on this side of the House, particularly the members of the Australian Country Party, are always fighting to ensure that the primary’ producers of Australia obtain fertilizer at the lowest possible price. We cannot always achieve our aims immediately. We arc members of a coalition government and we do not want to break our unity. But we keep on pushing and plugging away. Members like the honorable members for Indi (Mr. Holten), Wimmera (Mr. King) and Gippsland (Mr. Nixon) have been pushing and plugging away for years. I know that they are delighted that at last the subsidy on superphosphate has been granted. As I said before, I am particularly delighted, because this subsidy comes at a time when it will be of vital importance to the north coast of New South Wales, where we are trying to encourage farmers to develop the new types of legumes. To do this, large quantities of superphosphate are essential.

The coastal strip of Queensland contains millions of acres of speargrass country. The Queensland Department of Agriculture and the Commonwealth Scientific and Industrial Research Organization have carried out experiments there and have found that, with the application of superphosphate, certain legumes can be grown in the area. I am also aware of the work that the C.S.I.R.O. has done in the Wallum country. I have visited the research station ;at Beerwah and I have been absolutely astounded to see the results that have been obtained by -the application of a balanced fertilizer, consisting largely of superphosphate, and the introduction of new types df legumes. Soil that was practically sand has been rejuvenated and made fertile. The carrying capacity of the land previously may have been one beast to the square mile, but after a period of four, five or six years, the fertility of the land has increased so much that the carrying capacity is now one beast to one and a quarter acres. This is completely revolutionizing our thoughts about the poorer soils.

It seems quite obvious to me that the three most important factors for plant growth are a medium in which to grow the plants, decent rainfall of more than 30 inches and plenty of warmth and sunlight. If they can get fertilizer at a reasonable price, they can introduce the types of grasses and legumes needed to build up the nitrogen and humus content of the soil. By good management, country which was useless can become very useful. Australia’s development of these areas and of its grazing industries is in its infancy. We can double or treble our production in this sphere by means of the scientific knowledge that is coming to hand provided it can be done economically.

I want particularly to stress that in my area, which been a dairying and cattleproducing area since the turn of the century - an area where farms are settled and villages are established, and where there are roads and all the other amenities - we are not getting the benefit we would like to get from scientific knowledge. I believe the scientists will overcome the problems, provided they can get the finance with which to carry out the necessary work. A great deal of work has been done but a great deal remains to be done. I rose to speak for only a few minutes, and I conclude by again warmly congratulating the Government on having given this £3 per ton bounty on the production of superphosphate.

Mr TURNBULL:
Mallee

.- The bill before the House will give legislative authority to the announcement, made by the Treasurer (Mr. Harold Holt) in his Budget speech, that a bounty of £3 a ton will be paid on superphosphate manufactured in Australia and sold for use in Australia on and after 14th August, 1963.

It was not my intention to speak in this debate and I decided to do so only after two or three other honorable members had spoken. I will be brief. I do not want to go into the detail of where supplies of phosphate rock can be obtained, or of how valuable superphosphate is and how it will lift our production. All those things are known. The announcement of the subsidy has been received with great favour by primary producers all over Australia. There is not the slightest doubt that the use of superphosphate has lifted primary production in Australia more than anything else has done. We have only to look at country which a few years ago had a very low grazing capacity to find it to-day carrying two, three or more sheep to the acre.

Mr Peters:

– All this has been said before.

Mr TURNBULL:

– As the honorable member for Scullin says, all these things have been said before during this debate. I know that, and I am not here to argue these matters. They are established facts. Any one who listened to the debate to-night would have noticed the marked difference between the speeches from the Government side of the House and those from the Opposition side. Honorable members on the Government side of the House dealt with the payment of the bounty on superphosphate. Although Opposition speakers dealt with the measure to some extent from that aspect, they also had the forthcoming election in view and used the bill for political propaganda purposes. The honorable member for Scullin now interjects that this bounty has been granted only because an election is coming on. The bounty was announced in the Treasurer’s Budget speech, in the middle of August. At that time no decision had been made as to whether there would be an election. Statements such as that by members of the Opposition should be nailed for the untruthful statements that they are.

I want to rebut one or two other statements that have been made by honorable members opposite. The honorable member for Lalor (Mr. Pollard) is Labour’s spokesman in this House for the primary industries. He is trying to train the honorable member for Bendigo (Mr. Beaton) to take on that role, but he is up against a stiff proposition there for the simple reason that you cannot learn these things from books. The honorable member for Lalor was one of the soldier settlers after the First World War and has had the necessary experience. Without doubt, you must have experience on the land if you are to know its problems.

Honorable members opposite now say that I was an auctioneer. The fact is that I was brought up on the land. I lived on the land until I reached adulthood. Then I went into the auctioneering business for a few years, to get experience in marketing. 1 have been out of the auctioneering business ever since I joined the A.l.F. in 1940, but Labour still tries to put my auctioneering experience up against me. I was an auctioneer, and I could go back and do business again with every one with whom I then did business.

I want now to deal with what was said by the honorable member for Lalor. He said: “ Look at my 1961 rural policy speech. I said that we would give this subsidy.” You do not look at one part of a Labour policy speech. You look at the whole speech and then make a judgment. The honorable member for Bendigo got off the subject-matter of the bill and dealt with the suggested amount the Government will pay towards wool promotion. He said that was one of Labour’s ideas. There is hardly anything this Government has done about which Labour has not made some promise. Labour has promised payments in many directions. It has been easy for Labour to promise because for the last fourteen years it has been in opposition, lt has been making promises at election times but has not had to carry them out. The position will be the same in the future. Labour will not have to carry out its promises after the coming election. Labour says it will win the next election, but it has said that on the occasion of each election since 1949.

What would be the position if Labour did get into office, by some miscarriage of justice, at the next election? Labour has said that it would pay a £1 for £1 subsidy for wool promotion. I believe that, but Labour does not tell us how it would tax the wool-growers. It is on record that Labour spokesmen have said in this House, “If we arc returned to power we will re-adjust taxation standards “. Every one with an income over about £1,200 a year would have to pay increased taxation - and that includes most wool-growers. If Labour gives a subsidy on supherphosphate, for wool promotion or for anything else, it will take it back five-fold or ten-fold in taxation. The policy of the Labour Party is to give the people money and then take it away from them.

The honorable member for Bendigo said that the primary producer had been caught in the squeeze between rising costs and reduced prices for his products. There is no doubt that the primary producer has been caught between rising costs and low prices for his products. That was why the Government brought in the so-called credit squeeze. When that was done the honorable member for Bendigo and the honorable member for Lalor were against it, although it was the saviour of the primary producer. The primary producer in Australia could not continue to carry on and buy everything he wanted in our highstandard, ever-rising cost economy and sell most of his goods overseas. The fact of the matter is that no subsidies would be required if the primary producers could buy on the markets where they sell the bulk of their production. Australia is so situated that we want to build up our secondary industries, and we can do that only by protecting them, but if we go too far with protection the very source of prosperity in this country - primary production - is affected. You have in some way to circumvent that. The only way that can be done is by a subsidy on superphosphate and the stabilization of the dried fruits, wheat and dairy industries. Stabilization allows taxpayers’ money to be used when prices fall below cost of production. Without that primary producers could not continue to operate when prices fall.

I believe that the Labour Party is responsible to a very great extent for the rising costs in our economy. Never at any time have I heard members of the Labour Party say anything about the strikes and stoppages that increase our costs. I was surprised to see in a well-known Sydney newspaper a photograph of the Deputy Leader of the Opposition (Mr. Whitlam) taking part in a procession in support of a 35-hour week. What about the primary producer, whom the. honorable member for Bendigo (Mr. Beaton) and the honorable member for Lalor (Mr. Pollard) say they support! Does the primary producer have a 35-hour week? He certainly does not.

Mr DEPUTY SPEAKER (Hon W C Haworth:

– Order! I think the honorable member should get back to the superphosphate bounty.

Mr TURNBULL:

– I appreciate your impartiality, Mr. Deputy Speaker, but I was simply answering interjections by honorable members opposite.

Mr DEPUTY SPEAKER:

– And provoking them.

Mr TURNBULL:

– I make the point that the Labour Party is largely responsible lor rising costs. Primary producers would not want a superphosphate subsidy if they could buy in the same markets in which they se the bulk of their production.

To-night we have heard a lot of things about superphosphate. Superphosphate is known to promote the growth of clovers and other stock feed that were not apparent in the soil until superphosphate was applied to it. It is interesting to recall how the effect of superphosphate was first realized in this regard. A ma* was sowing a wheat crop. He had finished sowing the crop but had not quite cleared out the drill. There was still some superphosphate in it. He ran it across 200 or 300 yards to a shed. When the rains came there was a wonderful lush growth of clover where he had emptied the drill. That was when people first realized the wonderful value of superphosphate. May it continue fo be used and may this subsidy help primary producers to use more of it on their land.

Mr DALY:
Grayndler

.- 1 could not allow the remarks of the honorable member for Mallee (Mr. Turnbull) to pass unchallenged. It is interesting to note that the Country Party member is following the traditional policy of his party in opposing the granting to the people of the benefits of automation, such as a shorter working week. The honorable member has shown once again that the Country Party stands for long hours and low wages. It will be quite in order for the people to judge the Country Party in that light at the coming elections.

In this Parliament we regularly hear the so-called champions of the country man tell us what they have done for him. ft was not until Labour came to power in 1941 that the country people received any benefit by way of stabilized prices and guaranteed markets. Not until Labour came to power did the country people enjoy the prosperity that they deserved. When Labour was in office every country man had an income. He had money in the bank. Instead of owing money to the banks, the banks owed money to the country men. That situation could never have developed under a government other than a Labour government.

Let us see what has happened over the years regarding superphosphate. From 1941 to 1949, the Australian Labour Party gave the primary producer the benefit of a bounty on superphosphate but in 1949 the Liberal-Country Party Government removed the bounty and has not paid Id. in bounty since. This year, with an election pending, the Government has decided to give country electors something which it has denied them for a generation or more. Had Labour’s policy on superphosphate been continued since 1949 primary producers would have received tremendous benefits. I do not know the full extent to which primary producers have been robbed but the amount must run into millions of pounds. The fact that the Government is making a death-bed repentance and is to give country people £9,000,000 a year by way of a subsidy on superphosphate, which it has denied them for many years, is no credit to the Country Party. Rather is it an indication that the Country Party prefers expediency to sincerity in these matters.

If an election had not been pending I wonder whether this legislation would have been introduced at this time. Why has the Government seen fit to provide this benefit at this time? I can conclude only that the Government has realized that Labour’s promise to the electors in 1961 to restore the superphosphate subsidy would have won the approval of primary producers and that accordingly the Government has stolen Labour’s policy in an endeavour to win votes.

On every appropriate occasion the honorable member for Mallee has a lot to say about pensions and other matters. I think it was reasonable for this bounty to be paid as from the day after it was announced in the Parliament. People are entitled to receive the benefits of proposed legislation’ expeditiously. I do not quibble about that but it is significant that all members of the Country Party and the Liberal Party oppose the payment of increased pensions as from the day after it is announced that increases will be made.

Mr DEPUTY SPEAKER:

– Order! The honorable member should get back to the superphosphate bounty.

Mr DALY:

– I was comparing the treatment of primary producers with the treatment of needy people in the community. I was making passing reference to a matter on which Government supporters, and particularly members of the Country Party, are very touchy. I bow to your ruling, Mr. Deputy Speaker. I am aware of your impartiality and wisdom in these matters. Not for a minute would I think that you have any personal interest in my point of view or in the fertilizer for that matter. I advert to these matters only to show up the policy and the argument advanced by the honorable member for Mallee. Since he has been in this Parliament the honorable member has continually attacked the Labour Party for what it has done. He takes great pride in the fact that the Government has, on the eve of an election, given effect to a policy that Labour has always propounded. No matter which member of the Country Party you consider, the story is always the same. The honorable member for Richmond (Mr. Anthony) is basking in the sunshine of the honorable member for Cowper (Mr. McGuren), who is responsible for the flood mitigation proposals that have been announced. The same argument applies to the bounty on superphosphate. The Government which the honorable member for Mallee supports has stolen Labour’s thunder. It has implemented Labour’s policy. The honorable member for Mallee boasts that he is a member of a free enterprise party. He delights in the fact that now and again he can give effect to a little bit of socialism and prove that he is as militant as his leader was some years ago before he reformed.

I make those observations in the interests pf people who may be misled by the Country Party, which is supported by the Liberal Party, and which claims credit for policies with which honorable members opposite would have had nothing to do had an election not been pending. The Government parties are one man down. They are desperately fighting for survival. They are clutching at straws in an endeavour to save themselves.

Mr BARNES:
McPherson

– I feel obliged to reply to the honorable member for Grayndler (Mr. Daly).I was interested to hear the honorable member’s remarks. I know that he was brought up in a country district Currabubula, but could not take it. He left the country for the city but he has spoken in a debate that affects country people and he has sought to criticize Government supporters. The honorable member said that Labour governments were responsible for the wonderful benefits enjoyed by the man on the land. The honorable member included the superphosphate bounty but he omitted to say that when Labour was in power a ceiling price applied to primary produce. Our butter was being sold on the British market at 7s. 6d. per lb. but the producers were getting about 2s. per lb. That is the kind of treatment that the country man got from Labour governments. The lid was on everything. Land values were pegged. We could not sell our land.

The honorable member for Grayndler represents an electorate in which one of Australia’s biggest margarine manufacturing companies operates. Here is a man who claims that Labour has done a lot for the primary producer. I refer to these matters so that the people will not be misled.

Mr FAIRHALL:
Minister for Supply · Paterson · LP

– in reply - If phosphate fertilizer produced crops as well as it produces words we would be doing something to-night of extraordinary value to the economy of the country. Undoubtedly the bounty will be of great value. It will make a contribution to the prosperity of the individual primary producer and of the primary producing sector of the Australian economy, which underlies the whole of our economy. The bounty may not be applicable to every fertilizer and it may not cover every trace element, but it is a contribution of £9,000,000 a year to the cost of primary production in this country. I am glad that the bill has the support of the House.

I should liketo make a few remarks in response to those honorable members who have asked questions about the search for additional supplies of phosphate rock. A search sponsored jointly by the New Zealand and Australian Governments has been going on for some years in Australia, New Zealand and the Pacific Islands. More recently the Australian Government has been giving thought to warming up this search a little. Our thoughts on this have been interrupted for the time being but we hope to resume them quite soon.

The only other point to which I want to refer relates to the quite reasonable case raised by the honorable member for Sturt (Mr. Wilson) that the soluble phosphorus pentoxide content of a certain product should be recognized for purposes of bounty. I have to confirm what the honorable member himself has said, that the Minister is prepared to arrange for the Commonwealth Scientific and Industrial Research Organization to make a new evaluation, in the field, of whether the ground phosphate rock products provide an economic and efficient source of phosphate. Should the information gained in this evaluation so warrant, the Government will reconsider the question of whether these products should attract bounty. With that undertaking given in good faith to the honorable member for Sturt I commend the bill.

Question resolved in the affirmative.

Bill read a second time.

Message from the GovernorGeneral recommending appropriation announced.

Third Reading

Leave granted for third reading to be moved forthwith.

Bill (on motion by Mr. Fairhall) read a third time.

page 2361

UNIVERSITIES (FINANCIAL ASSISTANCE) BILL 1963

Bill returned from the Senate without amendment.

page 2361

VINYL RESIN BOUNTY BILL 1963

Bill - by leave - presented by Mr. Fairhall and read a first time.

Second Reading

Mr. FAIRHALL (Paterson - Minister for

Supply) [10.24].- I move-

That the bill be now read a second time.

When I tabled the relevant report of the Tariff Board on 1 4th August, 1963, I indicated that the Government had adopted the board’s recommendation for a bounty on uncompounded vinyl chloride polymers and copolymers, including latex. The bill now before the House is designed to implement this decision of the Government.

In accordance with the board’s recommendation a bounty of 4d. per lb. will be paid on the vinyl resins I have just described, which are produced in Australia and sold for use in Australia, or used by the producer in the production of other goods. The bounty will operate for three years as from 15th August, 1963, and will be subject to the usual reduction or elimination if and when profits exceed 10 per cent before tax. The two local producers of the goods are B. F. Goodrich C.S.R. Chemicals Proprietary Limited and Imperial Chemical Industries of Australia and New Zealand Limited. The industry employs over 200 people.

The vinyl resins are extensively used as an electrical insulation and in the production of a variety of other goods, which are extensively used in many important sectors of production such as the automotive, furniture, clothing and packaging industries.

The Tariff Board found that the industry produced a wide range of vinyl resins of apparently acceptable quality, and is capable of supplying the total demand and the range of resins required by the market in significant quantities. The board concluded that the industry merits assistance and that the most practical method of affording this is by bounty assistance in addition to the existing duties. Only in this way could the industry be assisted without undue disturbance to the costs of end users.

It is intended that the Tariff Board will again examine the question of assistance to the industry before the expiry of the bounty. I commend the bill to honorable members.

Debate (on motion by Mr. Haylen) adjourned.

page 2362

CHOWILLA RESERVOIR AGREEMENT BILL 1963

Bill received from the Senate, and read a first time.

Second Reading

Mr. FAIRBAIRN (Farrer- Minister for

Air) [10.27].- I move-

That the bill be now read a second time.

The purpose of this bill is to obtain the approval of Parliament to an agreement between the Commonwealth and the State of New South Wales for the provision of financial assistance to the State in respect of its share of the cost of construction of the Chowilla reservoir on the river Murray in South Australia.

This bill follows another measure recently introduced into this House to approve amendments to the River Murray Waters Agreement for the principal purpose of providing for construction of the Chowilla reservoir as a work under that agreement, the cost of the project to be shared equally between the Commonwealth and the States of New South Wales, Victoria and South Australia. When introducing that measure I explained at some length the important purposes the Chowilla reservoir will serve, and I shall not go over that ground again here.

During the inter-government discussions that led to the decision for construction of the reservoir as a work under the River Murray Waters Agreement the Government of New South Wales indicated that, while it fully agreed with the desirability of going ahead with the project as quickly as possible, it was not in a position to provide its onequarter share of the cost because of the extent of its other water conservation obligations. In view of the great national importance of the project, the Commonwealth offered to provide special loan assistance to New South Wales to enable it to finance its share of the cost. The State accepted the Commonwealth’s offer, and the agreement now before the House incorporates the arrangements that have been agreed between the two Governments for the provision of Commonwealth financial assistance to the State.

Under the agreement the Commonwealth will provide assistance to New South Wales to the extent of the State’s obligations, under the River Murray Waters Agreement, to contribute onequarter of the cost of the Chowilla project. Commonwealth payments to the State will be made in amounts equal to the amounts the State is required to pay from time to time to the River Murray Commission in respect of its share of the cost of construction of the project.

The State will repay each Commonwealth payment in twenty equal half-yearly instalments commencing ten years from the date the Commonwealth payment to the State is made. Interest, at the long-term bond rate applying when each payment by the Commonwealth is made, will be paid to the Commonwealth by the State, at halfyearly intervals from the time the Commonwealth payment is made, on the outstanding balance of each Commonwealth payment. The repayment and interest provisions are the same as those applying in the case of the agreement between the Commonwealth and the State of New South Wales on the Blowering reservoir. The agreement also contains a number of machinery provisions of a similar kind to those embodied in Other recent CommonwealthState agreements for the provision of special Commonwealth financial assistance for major developmental projects in the States. - On the basis of the tentative cost estimate of £14,000,000 for the Chowilla project, the extent of Commonwealth assistance under the agreement will be £3,500,000. The agreement does not, however, limit the amount of Commonwealth assistance to this figure; the State will be entitled to assistance equal to onequarter of the actual cost of the project. In addition to the assistance to be provided to New South Wales under the agreement, the Commonwealth will, of course, be providing its own contribution of onequarter of the cost of the project under the provisions of the River Murray Waters Agreement. The Commonwealth will thus be financing, in the first instance, onehalf of the cost a fact which indicates the great national importance attached by the Government to a major project for further conservation of the waters of Australia’s foremost river system. I commend the bill to the House.

Debate (on motion by Mr. Luchetti) adjourned.

page 2363

DEFENCE FORCES RETIREMENT BENEFITS BILL 1963

Bill - by leaves - presented by Mr. Harold Holt, and read a first time.

Second Reading

Mr HAROLD HOLT:
HigginsTreasurer · LP

– I move -

That the bill be now read a second time.

This bill is a companion measure to the Superannuation Bill which was introduced on Thursday last. Since its inception in 1948, the principles of the defence forces retirement benefits scheme have been in parallel with those of the Superannuation Act, modified by the special needs of the services, in particular the earlier retiring ages.

Part III. of this bill provides further increases in existing pensions. Servicemen who retired in earlier years will also have the Consolidated Revenue component of their pension brought up to the level which would now apply had the pension been determined on the basis of entitlements contained in the Defence Forces Retirement Benefits Act 1959, applied to the rates of pay in force after the marginal increases in pay in 1959.

Provision, corresponding to that contained in the Defence Forces Retirement Benefits (Pension Increases) Act 1961, is made for a proportional increase in pension for those who contributed for less than their full entitlement, or commuted part of their pension to a lump sum on retirement.

The other main part of the bill concerns the future pension entitlements of present contributors to the Defence Forces Retirement Benefits Fund. These pensions, most of which are payable at the earlier retiring ages of the services, are a proportion, according to age at retirement, of the pension payable at age 60 under the Superannuation Act. This bill restores the proportion between pension payable at age 60 and pay that was the basis of the Defence Forces Retirement Benefits Acts 1959 and 1962. By the inclusion of an appropriate formula these proportions of pension to pay will be preserved in the future without the recurrent need for legislation to amend the scale of entitlements.

The Government has also taken this opportunity to reconsider the very abrupt reduction in relative pension entitlement which at present applies to the more senior officers of the services and has decided that it should be modified. For the reasons outlined in my secondreading speech on the Superannuation Bill, the Government has concluded that, at age 60, the more senior officers should not receive less than a halfpay standard on their retirement. For retirement at earlier ages the existing relativities to the age 60 pensions will be preserved.

As this bill is designed automatically to preserve the established proportion of pension to pay in the future, it has been necessary to express the rates of contribution for those who became contributors subsequent to the date of commencement of the Defence Forces Retirement Benefits Act 1959 in a different form. The bill incorporates a formula for determining the appropriate contribution for these contributors. Their rates of contribution are preserved, in accordance with the decision of the Government in 1959, generally at 5 per cent of pay, which is designed to provide 221/2 per cent of the cost of each pension. This basis of contribution provided by the Defence Forces Retirement Benefits Act 1959 represented a major change and it was recognized at that time that it would call for careful review at the next statutory investigation of the fund by the Commonwealth Actuary, which is to be made as at 30th June, 1964, in accordance with section 22 of the principal act. In view of the improved benefits contained in this bill, that review becomes even more important; and the increased entitlements now being provided, for which no immediate increase in contributions is required, may call for some adjustment in contributions following that actuarial investigation.

The contributions paid by other members of the forces that is, those who joined the fund prior to 1959 are expressed in a different manner in the Defence Forces Retirement Benefits Acts 1959 and 1962 and in Statutory Rules 1960 No. 43 and 1963 Nos. 36 and 38. There will be no present change in these rates although they, too, are subject to reexamination following the actuarial report as at 30th June, 1964. The amount of the additional contributions for the increased entitlements, especially for the older members, will be heavy because of the shorter period in which their share of the total cost of the additional entitlement must be met.

As those who are nearing retirement may find it difficult to meet the additional amount of fortnightly contributions, provision is made for those who joined the fund prior to 1959 and who are within eight years of retirement to reject or to defer, until retirement, contributions for portion or all of the additional entitlement becoming available upon the enactment of the bill. This repeats the arrangements made in 1959. . The bill also provides for the making of regulations to establish an advance contributions account so that these contributors may elect to make advance contributions, if they so desire, on a similar basis to that upon which Superannuation Fund contributors may take up reserve units of pension against the possibility of further increases in entitlements in the future as a result of movements in rates of pay or promotion.

Several administrative amendments are also included in the bill, the most important of which will bring the powers of investment of the Defence Forces Retirement Benefits Board into line with the wider powers proposed for the Superannuation Board. It is hoped that this diversification of investments will also improve the earning rate of the Defence Forces Retirement Benefits Fund. I commend the bill to honorable members.

Debate (on motion by Mr. Haylen) adjourned.

House adjourned at 10.39 p.m.

page 2364

ANSWERS TO QUESTIONS

The following answers to questions were circulated: -

Productivity and Unemployment Statistics. (Question No. 254.)

Mr Whitlam:

m asked the Treasurer, upon notice -

What progress has the Statistician made on preparing statistics on (a) productivity since his reply to me on 1st June,1960, and (b) unemployment since his reply to me on 8th August, 1962?

Mr Harold Holt:
LP

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

  1. The Commonwealth Statistician has informed me that since my reply to you of 1st June, 1960 he has continued research into the measurement of production. Because of the difficulties of concept and deficiencies of data there are no generally accepted standards for the measurement of productivity in the sense ofquantity of product per unit of labour and capital used in production. For this reason, official investigations in most countries, including Australia, must still be regarded

Rs being in the experimental stages and it is not usual (even in “ industrial countries “) for official statisticians to publish indexes of productivity. No doubt the honorable member is aware of the Commonwealth Statistician’s publication, issued in July, 1963, entitled “Australian National Accounts”. This contains estimates of gross national product at constant prices for the period 1948-49 to 1961-62. As pointed out, however, on page 16 of that publication, because of the approximations and assumptions necessary to arrive at constant price estimates, the results have considerable limitations for some purposes, including studies of productivity.

  1. The Commonwealth Statistician advises that the analysis of the results of the Work Force Surveys thai have been conducted in the six Stale capital cities is nearing completion and that he expects to be in a position to commence publicition of statistics of unemployment obtained from this source before the end of the year.

Night Fighter Aircraft. (Question No. 290.)

Mr L R Johnson:

son asked the Minister for Defence, upon notice -

  1. Does Australia possess any night fighter aircraft?
  2. If so, bow many have we and what type are they?
Mr Fairhall:
LP

– The Acting Minister for Defence has furnished the following answer: -

The Royal Australian Navy Fleet Air Arm includes a “ front line “ unit equipped with Sca Venom aircraft which is a night and all weather fighter. Of these aircraft 29 are held by the Royal Australian Navy. The Sabre aircraft with which the Royal Australian Air Force is currently equipped is a day fighter/ground attack aircraft. The Mirage aircraft which will replace the Sabre is a night-all weather fighter aircraft. As previously announced, the purchase of a total of 100 Mirage aircraft has been approved by the Government.

Williamstown Rifle Range. (Question No. 336.)

Mr Benson:
BATMAN, VICTORIA

n asked the Minister for the Army, upon notice -

Has he given a firm promise that the Williamstown rifle range will be preserved for the use of civilian riflemen?

Mr Cramer:
Minister for the Army · BENNELONG, NEW SOUTH WALES · LP

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

No. However, the civilian rifle clubs have been given assurance that they ma/ continue ti use the facilities provided by the Williamstown rifle range while it remains under Army control. The military requirement for the range is firmly established and it is envisaged as continuing indefinitely.

Postal Department. | (Question No. 358.)

Mr Cross:
BRISBANE. QLD

s asked the Postmaster-General, upon notice -

  1. How many mobile watches are employed by lift department in . Brisbane?
  2. How many ordinary watchmen have been replaced?
  3. What is the saving brought about by the new method taking into account the provision and maintenance of vehicles and the supply of petrol?
  4. Is is a fact that there has been a series of robberies at the Victoria park stores and that a substantial sum of money has been stolen?
  5. Under all these circumstances would the best interests of the department be served by restoration of the previous system of watching; if not, why nol?
Mr Davidson:
CP

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

  1. Six watchmen are employed on the mobile patrol service; in addition, three watchmen are employed on a non-mobile basis for the G.P.O. and adjacent buildings. The mobile watchmen use cars equipped with radio-telephone facilities. This ensures continuous communications with their headquarters and each other’s car. . They also carry duplicate keys to all departmental metropolitan establishments including suburban post offices not formerly covered by watching service.
  2. Eighteen full-time and one part-time watchmen were employed before the mobile service was introduced. The nine full-time and one part-lime staff whose services were no longer required as watchmen when the mobile patrol service was introduced were all offered and most accepted alternative employment in the department
  3. lt is estimated that costs for a full year will not exceed £14,800 and a saving of £4,800 is expected. Cost of the watching service which operated during financial year 1962-63 was £19,600.
  4. Stores premises at Victoria Park have been entered three times between 1st July and 4th September, 1963, and cash :nd cheques totalling £85 3s. 6d. were stolen. The thefts are still under investigation and at .’bis stage there is some indication that they could have occurred under the previous system of fixed watchman service.
  5. Based on experience to date it is felt that the mobile system which is more economical and covers more establishments than previously, is at least as satisfactory as the former system and should be continued.

Telephone Services. (Question No. 365.)

Mr Daly:

y asked the Postmaster-General, upon notice -

Mow many telephone applications are outstanding in (a) each State, (b) Australia at this date?

Mr Davidson:
CP

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

Taxation.

Mr Harold Holt:
LP

t.- On 16th October, the honorable members for East Sydney (Mr. Devine), and Reid (Mr. Uren), asked me questions concerning the position in relation to the taxation of income derived by clubs. The honorable member for Reid subsequently asked for an assurance that clubs in New South Wales are placed in a position not different from that of clubs in other States in regard to this matter. I promised the honorable members that I would obtain such information as can properly be made available.

The Commissioner of Taxation has now supplied the following information: -

The taxation liabilities of licensed clubs are, of course, governed by the principles that have been laid down by Parliament in the provisions of the Income Tax and Social Services Contribution Assessment Act and, in this particular field, the requirements of the law have remained unchanged for many years. I need hardly add that these requirements are administered on a uniform basis throughout Australia and that the Commissioner of Taxation has no option but to enforce the law where cases come under notice in which a liability to tax exists but has not been satisfied. The present position in New South Wales differs from that in other States only because of the amount of revenue involved.

It is an established principle of the British and Australian income tax systems that a club or other voluntary organization does not derive income from its dealings with its own members. This rule, generally known as the principle of mutuality, is based on the substantial identity of the club and the members who join it, and the assumption that a man cannot make a profit from dealings with himself.

Accordingly, no liability to taxation arises where a club does no more than provide liquor, meals, accommodation or other facilities for its own members.

The mutuality principle does not apply, however, to the income which a club derives from the investment of its own funds, or from trading with non-members. There are sound practical reasons underlying this distinction. An individual taxpayer is liable to pay income tax on any income he derives from the investment of his - own savings or from trading with other persons and it could be regarded as anomalous if a corresponding liability were not imposed where persons join together as a club and income is derived from investments which they jointly own through their membership of the club, or from the trading with non-members which the club carries out on their behalf.

As I have said, a licensed club does not incur any liability to income tax’ in respect of subscriptions received from members or the surplus arising from sales to members or from the use of club facilities by members. The club’s taxable income is ascertained by taking as a starting point, the income received from investments, from sales to non-members and from the use of club facilities by non-members, and deducting from this figure an appropriate share of the expenses of running the club and any other deductions to which the club is entitled under specific provisions of the income tax law (e.g., deductions in respect of gifts to charitable and other funds which are specified under section 78 of the assessment act).

Certain difficulties do occasionally arise in determining the amount of non-member income but, generally speaking, it has been found possible to reach agreement with club officials on a reasonable estimate of the proportion of a club’s total trading income that should be regarded, for income tax purposes, as having been received from dealings with non-members.

In most cases, licensed clubs are deemed, for income tax purposes, to be non-profit companies. As such, they do not incur any liability to tax unless the taxable income, ascertained in the manner I have outlined above, exceeds £104. From £105 to £260, the rate of tax is limited to half of the amount by which the taxable income exceeds £104. Thereafter the rate is 6s. in the £1 up to £5,000 and 8s. in the £1 in respect of income in excess of £5,000.

It is quite correct, as the parliamentary questioners have stated, that action is currently being taken in New South Wales to ensure that licensed clubs which have failed to lodge income tax returns will be reminded of their obligations under the law. There is, however, nothing unusual about this procedure. From time to time, it becomes apparent that a loss of revenue is being incurred in a particular field and, if the amount involved is substantial, it is the usual practice for the commissioners, or for the deputy commissioners in the States concerned, to initiate action to ensure that the tax which is lawfully payable is collected. It is common knowledge that clubs in New South Wales are currently deriving very large incomes from a source not available to clubs in other States and this, no doubt, has prompted the inquiries at present being made in New South Wales. Similar inquiries have been and will be made by deputy commissioners in other States where circumstances warrant it.

In his parliamentary question, the honorable member for East Sydney also asked whether you could give an assurance that clubs would not be penalized for their failure to furnish returns in earlier years.

The legislature has provided that a taxpayer who fails to furnish an income tax return shall be liable to pay a penalty equal to the amount of tax assessable or £1, whichever is the greater. However, the commissioner has power to remit this statutory penalty, either wholly or in part. I am not aware of any case in which a penalty has, in fact, been levied on account of the failure of a club to lodge income tax returns and the penalty would normally be remitted in full in any case where it was clear that the persons in control of a club had failed to lodge income tax returns because of a genuine misunderstanding as to the requirements of the income tax law.

Each case has to be considered on its own merits, but the honorable member for East Sydney could be assured that all the surrounding circumstances would be very carefully considered before any penalties would be imposed for late lodgment of returns.

Mr Harold Holt:
LP

t. - On 22nd October, the honorable member for Mallee (Mr. Turnbull) asked me whether the wool levy payable by wool-growers will continue to be an allowable deduction for income tax purposes in the event that the Government’s proposal for matching the increased contributions by growers becomes operative.

As honorable members know, the wool levy is used for the purpose of financing wool use promotion and wool research on behalf of the growers. As such, it is a normal business expense incurred by the growers and is therefore deductible under the income tax law.

I can assure the honorable member that, so far as this Government is concerned, the whole amount of any such levies payable in the future will continue to be allowable deductions.

page 2367

TAXATION

Cite as: Australia, House of Representatives, Debates, 28 October 1963, viewed 22 October 2017, <http://historichansard.net/hofreps/1963/19631028_reps_24_hor40/>.

View PDF View XML View in Voyant