House of Representatives
24 November 1965

25th Parliament · 1st Session

  1. House of Representatives
  2. 25th Parliament
  3. 1965

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

page 3099

QUESTION

INSURANCE COMPANIES

Mr CALWELL:
MELBOURNE, VICTORIA

– I wish to ask the Prime Minister this question: Has he considered amendment of the Life Insurance Act to protect the interests of policy holders in assurance companies which are privately owned and where a proportion of profits is appropriated annually for the benefit of shareholders and where it is possible for the funds of policy holders to be misused by the companies’ directors to protect the shareholders against loss? If so, is action to be taken and can the right honorable gentleman give details of whatever action may be proposed?

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

– The honorable gentleman will be the first to recognise that this is a fairly important and in some respects complicated matter. I would like to have an opportunity to look into it and think about it. I will certainly do so.

page 3099

QUESTION

TARTAR MISSILES

Mr JESS:
LA TROBE, VICTORIA

– I wish to ask the Minister for the Navy a question. What arrangements have been made for the supply of Tartar missiles for the guided missile destroyers, or D.D.G.’s, for the maintenance of the missile systems on the ships and for the training of technicians.

Mr CHANEY:
Minister for the Navy · PERTH, WESTERN AUSTRALIA · LP

– Each of the ships will be equipped with a specified number of missiles as part of its armament and there will be in reserve a number of missiles determined according to standards laid down by the defence authorities. The maintenance of the missile systems will be a joint project of the Department of the Navy and the Department of Supply which is the Department ultimately responsible for the work. With respect to the training of technicians, my Department has at present in the United States of America several members of the technical staff who are undergoing training where this kind of training is given. They will return to Australia with the necessary proficiency to undertake the training of technicians here.

page 3099

QUESTION

ROADS

Mr LUCHETTI:
MACQUARIE, NEW SOUTH WALES

– I ask the Prime Minister: Has his attention been directed to the statement by Mr. J. H. Devitt, retiring President of the Australian Automobile Association, that the Commonwealth Government has failed to give adequate attention to roads and road safety and is toying with road safety programmes? In view of the ever increasing terrible toll of death and destruction on Australian roads will the right honorable gentleman initiate new and positive action in concert with the States to deal with this frightening problem? If not, what does he intend to do about this urgent matter that affects every person in our community.

Sir ROBERT MENZIES:
LP

– My attention has not been directed to the statement made by Mr. J. H. Devitt of the Australian Automobile Association. However, the problem referred to is one which, I think, every Government in Australia is greatly concerned about. We are just as concerned about it as other Governments, though our powers may be somewhat more restricted.

page 3099

QUESTION

EMPLOYMENT OF EPILEPTICS

Mr HAWORTH:
ISAACS, VICTORIA

– I ask the PostmasterGeneral a question. Recently on an Australian Broadcasting Commission programme reference was made to the difficulty that epileptics had experienced in finding suitable positions of employment on the labour market, including the Government service. Reference was made particularly to the Postmaster-General’s Department. Is it correct to say that the Postmaster-General’s Department has refused to accept persons who suffer with this complaint? If so. is this justified, bearing in mind that sufferers, apart from attacks, are perfectly normal people of above average intelligence and are deserving of every encouragement in the field of employment?

Mr HULME:
Postmaster-General · PETRIE, QUEENSLAND · LP

– This is really a matter which relates to the operation of the Public Service Board. As I understand the situation in regard to the Post Office, an epileptic is not accepted, in the initial stages of employment, for appointment on a permanent basis. After a period of four years and subject to examination by the Commonwealth Medical Officer, he may be accepted. However, in such case he would not be entitled to contribute to the Superannuation Fund but would have an entitlement in relation to the Provident Account. We do accept on a temporary basis people who have a mild form of epilepsy, provided that it is possible to place them in a safe area and provided they do not come in contact with the public. As an illustration of this, they would not be employed as linemen or in one of the hazardous occupations within the Post Office. Whether they are admitted to employment in the Post Office depends in both cases on the report of the Commonwealth Medical Officer.

Mr CALWELL:

– I ask the Prime Minister a question supplementary to that asked by the honorable member for Isaacs. The Prime Minister was good enough to receive the honorable Ruby Hutchison, M.L.C., from Western Australia and myself in his rooms. As President of the Western Australia Epilepsy Association Inc., she put forward certain proposals for the amendment of the Commonwealth Public Service Act and the Commonwealth Superannuation Act. The Prime Minister promised to give those matters consideration. I ask him now: When does he expect to be in a position to say what the Government’s policy is in regard to the amendments to these two Acts in the interests of people who are highly competent but who, in some cases through war service and in other cases because of congenital circumstances, are afflicted with this unfortunate trouble?

Sir ROBERT MENZIES:
LP

– I am sorry to say that I have not yet been able to arrive at final opinions on this matter. I understand the honorable gentleman’s suggestions and I have a great deal of personal sympathy with them, but these are somewhat complex matters which have to be thrashed out having regard to the general Public Service administration. As soon as that has been done I hope to be in a position to say something.

page 3100

QUESTION

EXPORT OF CATTLE

Mr ARMSTRONG:
RIVERINA, NEW SOUTH WALES

– I ask the Acting Minister for Primary Industry a question. Is it a fact that the Chilean Government has recently cancelled a contract for a shipment of stud and herd cattle because of the alleged unsatisfactory condition of two previous shipments on arrival in Chile? If this is so, could the facts be investigated and, if necessary, measures taken to ensure that animals exported in future fully comply with the description supplied to the purchasers?

Mr ANTHONY:
Minister for the Interior · RICHMOND, NEW SOUTH WALES · CP

– A Chilean development authority did order three shipments of stud and herd cattle from Australia. Because of the unsatisfactory conditions of shipment of the first two consignments, the third order was cancelled. I am informed that negotiations are taking place between the buyer and the seller on this matter. The Department of Trade and Industry has been informed of the dispute between the parties and, in conjunction with the Department of Primary Industry, is looking into the matter with a view to seeing what assistance might be given to the cattle industry in connection with exports.

page 3100

QUESTION

EMPLOYMENT OF EPILEPTICS

Mr COSTA:
BANKS, NEW SOUTH WALES

– I address to the Minister for Social Services a question similar to that asked by the honorable member for Isaacs. Is the Minister aware of the work stigma placed on persons suffering from epilepsy? I am sure that the Minister would know, as do most honorable members, that once an employee takes an epileptic fit on the job, industry dispenses with that person’s services and generally marks him or her as unsuitable for employment. Despite this, many sufferers from epilepsy are disqualified from obtaining the invalid pension, the unemployment and sickness benefit or other social service benefits. Will the Minister give consideration to the position of epileptic sufferers with a view to seeing whether his Department could give more sympathetic consideration to applications by these unfortunate people for social service benefits?

Mr SINCLAIR:
Minister for Social Services · NEW ENGLAND, NEW SOUTH WALES · CP

– My colleague, the Postmaster-General, has already referred to the employment within the Post Office of persons who are subject to epileptic fits. Within private industry, quite a number of such persons have been placed through the Commonwealth rehabilitation service. For the 12 months ended 30th June 1965, 44 persons who were subject to epilepsy were retrained and readmitted to employment. Many of these unfortunate people, due to the advances made by medical science. can now be helped. Epilepsy is a complaint about which far more is now known and it is possible to prescribe treatment. Consequently, epilepsy need no longer prevent a person from entering employment.

As to the eligibility of sufferers from epilepsy for social service benefits, the basic requirement for eligibility for the invalid pension is that a person shall be incapacitated to the extent of 85 per cent, of the norm for the particular type of work in which he engages. As it is practicable in most instances to train persons subject to epilepsy so that they have a lesser degree of incapacity, it has been possible to bring such persons into the work force rather than put them permanently on the invalid pension. It is hoped that, through the Commonwealth rehabilitation service, more of these people will be able to enter the work force in the future.

page 3101

QUESTION

GUNMETAL

Mr ERWIN:
BALLAARAT, VICTORIA

– My question to the Minister for Trade and Industry relates to the sudden increase of the price of ingot gunmetal, which has been caused by the lifting of the export ban on non-ferrous scrap metals. Can the Minister tell the House whether some early action will be taken to ease this serious situation, which, if not corrected soon, will have an adverse affect on the export of particular manufactured products and will cause a steep price rise to be passed on to internal users of those products?

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

– I am not aware of the position with relation to gunmetal, but I think this problem must have a basic relationship to the prices for copper and scrap copper. The position is that world prices for copper have risen very sharply over recent months, but Australian copper producers have been obtaining for virgin copper sold in Australia prices very much lower than those which can be obtained on the world export market. Australian copper producers are selling virgin copper at £395 a ton at a time when the London Metal Exchange price for copper ranges from £650 to £700 a ton. This has led to the situation where the value of scrap copper in Australia is very much higher than the value of unused copper. The domestic price for No. 1 scrap copper today is £470 a ton compared with the virgin copper price of £395 a ton. Clearly there is an outflow of scrap copper from Australia. It would be a highly profitable business to buy virgin copper, do something to convert it to scrap and resell it. The Government, which is reluctant always to interfere with the normal flow of private commerce, must, I think, in the circumstances have a prompt look at this situation in relation to the problems that have been created.

page 3101

QUESTION

AUTOMATION

Mr BIRRELL:
PORT ADELAIDE, SOUTH AUSTRALIA

– Has the attention of the Minister for Labour and National Service been drawn to a report in today’s “ Australian “ of a Sydney research survey into automation which suggests that some 400,000 workers will be displaced or affected by automation in Australian within the next 5 to 10 years? Will the Minister arrange to have the survey investigated by officers of his Department, and if the conclusions reached by the research group prove in any way reliable will he, as a first step, take immediate action to set up within his Department a permanent automation committee on the lines suggested by the Australian Council of Trade Unions?

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

– The Department of Labour and National Service is constantly examining the problems of the impact of automation on the work force. I think it is known that it is our present view - and this is supported by the trade unions - that at the moment and for the immediate years ahead we should not fear the effects of automation. We are committed to a very high growth rate, with a large increase in population due to a considerable extent to immigration. Against this background it is our feeling within the Government that we have the means of expanding demand and, consequently, the means of keeping our employment high - at a full employment level. Therefore we do not think that automation will have the dire effects predicted in the report the honorable member has mentioned. Nonetheless, my Department has a section that deals specifically with automation and if we do see problems arising they will be immediately brought to the attention of the Government. I direct attention to the most recent survey we are making concerning the printing industry. We have found that where there has been large scale introduction of automation it has led to an increase rather than a reduction in the number employed.

page 3102

QUESTION

TAXATION

Mr FOX:
HENTY, VICTORIA

– Last week I asked the Treasurer whether the Government would consider amending our income tax law to permit the cost of converting business machines for use with decimal currency to be claimed in full in the year in which the expenditure was incurred. The Treasurer assured me that the matter would be considered. I now ask the Treasurer: Mas a decision been reached by the Government?

Mr HAROLD HOLT:
Treasurer · HIGGINS, VICTORIA · LP

– I am glad to say that a decision, in principle, has been reached on this matter to the general effect desired by the honorable member. When the legislation we are considering relating to decimal currency reaches the Committee stage I hope an amendment will be produced - in fact I should like the honorable member to move it - to give effect to his objective.

page 3102

QUESTION

HOUSING LOANS

Mr WHITLAM:
WERRIWA, NEW SOUTH WALES

– I ask the Treasurer a question. The right honorable gentleman will have noticed that the level of home approvals last month was lower than in October last year or October 1963. As the Prime Minister a week ago said that no general weakening of demand seemed to be indicated, and the Minister for Housing has said that the flow of finance for housing lies outside his departmental jurisdiction, does the Treasurer acknowledge the trend and will he accept any responsibility for restoring the level of home building?

Mr HAROLD HOLT:
LP

– What the honorable gentleman has said reflects the statistical returns. There is nothing inconsistent in what has been said on this matter by the Prime Minister and the Minister for Housing. The decision as to the effect that the Government can achieve through economic policies lies in the hands of the Cabinet. The Minister for Housing is called into Cabinet discussions on matters which relate to his administration. The Prime Minister said that demand in this field continues to be strong. At least, that was the effect of his statement as I read it.

This is consistent with my understanding of the position. There is still a strong demand for housing and for finance for housing. The Reserve Bank had come to an understanding with the savings banks that finance for housing would be sustained at a high level. I think that this has been done although finance, overall, for housing has shown some reduction. On the other hand, you get a situation in the economy where construction activities are being sustained at a very high level because of the extraordinary extent of construction for non-residential purposes. The latest figures - I am drawing on my recent recollection now - show that for the three months ended October the value of approvals was 34 per cent, higher than in the corresponding period last year.

page 3102

QUESTION

WHEAT

Mr KING:
WIMMERA, VICTORIA

– I ask the Acting Minister for Primary Industry a question. I remind the Minister that growers in northern areas have completed their wheat harvest. I remind htm also that the price of wheat has a big bearing on the price of other grains. I refer particularly to oats, which are used for feed purposes and which are being harvested in Victoria now. When will the Minister announce the first advance on wheat sales and will he say what the home consumption price of wheat will be?

Mr ANTHONY:
CP

– The Wheat Industry Stabilisation Act requires that the cost of production be established each year after consultation with State Ministers and that it shall apply from 1st December. The home consumption price is established having regard to the cost of production. The guaranteed price also applies from 1st December. I am not able to say when these details will be announced, but it is customary to announce them on 30th November. I hope to make the announcement then.

page 3102

QUESTION

DROUGHT RELIEF

Mr HARDING:
HERBERT, QUEENSLAND

– I ask the Prime Minister a question. Has the Queensland Government sought from the Commonwealth £5 million in loans and grants for urgent drought relief? If so, what is the result of this request?

Sir ROBERT MENZIES:
LP

– I am not certain whether the Queensland Government has asked for a specific amount, but it has been in touch with the Commonwealth about drought relief. I have only recently outlined to the Queensland Government the same provisions and undertakings as I had already indicated in the case of New South Wales. We will apply similar rules in each case.

page 3103

QUESTION

DEPARTMENT OF TRADE AND INDUSTRY

Mr BUCHANAN:
MCMILLAN, VICTORIA

– I direct a question to the Minister for Trade and Industry. When answering a question in this House on 18 th May last the Minister said that the Department of Trade and Industry is primarily concerned with our trade business overseas and with promotion as distinct from negotiation, because of which the three senior officers of the Department spend so much of their time abroad that they cannot give adequate service to industry within Australia. In view of the present slowing down in industry owing to the continuing pressure of unnecessary imports of both consumer goods and materials for manufacture, will the Minister now reconsider my proposal to overcome the stalemate in the effective operation of the Industries Division, as a sub-department within the Department of Trade and Industry, by establishing an entirely separate ministry for secondary industry with a charter similar to that enjoyed by the Department of Primary Industry?

Mr McEWEN:
CP

– I recall, although not with precise detail, the question which the honorable member asked me and the reply which I gave. The last few weeks have provided evidence of the calls that are made upon the senior officers of the Department of Trade and Industry, requiring frequent journeys overseas. I was away on duty for nine weeks recently. During the same period the Secretary of the Department, Sir Alan Westerman, was away conducting negotiations. A Deputy Secretary of the Department, Mr. Campbell, was for practically the whole of that time the official leader of the sugar delegation. I was the political leader. As soon as Sir Alan returned to Australia, Mr. Carmody, the other Deputy Secretary, left to join me in India and go on to Japan. He is now in the

United Kingdom, conducting further negotiations. I give this information to illustrate the calls presently made on the senior officers of the Department. This could lead to a conclusion that there ought to be at least one more senior officer or it could lead to a conclusion that there ought to be another department. That would be a matter of high policy and not for me to comment upon.

For many years one department, the Department of Commerce, operated to conduct overseas commercial negotiations, whilst a completely different department, the Department of Trade and Customs, had the function of protecting Australian domestic industry. People other than I decided that there were powerful grounds for bringing these two functions under the one roof. I subscribe to the belief that this is desirable, for this simple, statable reason: The person who wants to obtain better access to overseas markets for Australian items of trade will constantly be under pressure to concede reductions in Australian tariffs as payment for that better access, and if he has no function with regard to tariffs, he is likely to ignore the effect of reductions on Australian domestic industry. However, if that person has also the responsibility, as I have, of protecting Australian domestic industry, then he will maintain a proper balance between the two responsibilities and, I think, operate more effectively than two separate and conflicting departments would operate.

page 3103

QUESTION

HOSPITAL BENEFITS

Mr COUTTS:
GRIFFITH, QUEENSLAND

– I address my question to the Minister for Health. When did the Department of Health decide to revise its policy of making bed subsidy payments to the Mount Olivet Hospital for the incurably sick and dying in Brisbane? What is the reason for the change in policy with relation to this hospital, which has operated under the existing scheme since 1957? Will the Minister review the decision to alter the Commonwealth subsidy extended to the Mount Olivet Hospital, which has recently increased its accommodation to 300 beds, and which is a charity that is most enthusiastically supported in the financial sense by all the people of Brisbane?

Mr SWARTZ:
Minister for Health · DARLING DOWNS, QUEENSLAND · LP

– First I should like to say how much we all appreciate the splendid work of the Mount Olivet Hospital and similar hospitals in Brisbane and in the other States. However, answering the question of the honorable member, there has been no change whatsoever in Government policy in relation to this matter. The position is that the Government provides what are known as Commonwealth benefits, in the form of a subsidy paid direct to the hospitals. Where treatment is provided under the special account system or where the patient is a pensioner it is paid on the basis of 36s. a day. Where the subsidy is provided in relation to a person who receives nursing home treatment it is paid on the basis of £1 a day. The variation is due to the fact that different types of treatment are provided. A hospital has to provide additional nursing facilities and additional facilities within the hospital such as operating theatres. In nursing homes the facilities required are far less. There is no change of policy in relation to this matter. Where an application applies to a terminal hospital case the higher subsidy normally applies. In the case of long-term patients, such as patients in nursing homes, the lesser subsidy would normally apply and the hospital would be registered as a nursing home. However, I have seen some publicity of a most unfortunate type about this matter. I am sure that this did not originate in the hospital itself, as the authorities there have been holding discussions with the Department of Health for at least 12 months and understand the position quite well. I can assure the honorable gentleman that any consideration that is needed will be given in the most sympathetic way.

Mr CLEAVER:
SWAN, WESTERN AUSTRALIA

– My question, which is supplementary to that just asked, is also addressed to the Minister for Health. Were speeches made by honorable members, during the Minister’s absence overseas, about the inadequacy of the payment of £1 per patient per day under the National Health Act, referred to him? Is there a constant review of this matter going on within the Department of Health? Would the Minister give particular attention to the possibility of a differentiation between charitable bodies and church hospitals caring for the incurably ill, which desperately need a contribution higher than the £1 per patient per day, possibly even more than applies to patients in public or general hospitals?

Mr SWARTZ:

– The speech made by the honorable member for Swan during the debate on the departmental estimates was certainly referred to me along with the speeches of other honorable members made at that time. The Minister for Social Services ensured that this was done on my return. The position is that the subsidy, or the Commonwealth benefit, as it is technically termed, is not designed to cover the full cost of hospitalisation or the full cost of nursing services in a nursing home. The amount paid is meant to be a supplement under the national health scheme. That is basic to the scheme. Any consideration of an increase in any of these benefits is a matter of Government policy, and the only answer I can give at this stage is that the matter will be considered at the appropriate time.

page 3104

QUESTION

UNITED NATIONS

Mr E JAMES HARRISON:
BLAXLAND, NEW SOUTH WALES

– My question is directed to the Minister for External Affairs. Has he yet ascertained how Australia voted at the United Nations on the question of an oil embargo against Rhodesia? Is the House to understand by his reply yesterday that no instructions were sent by the Government to our representative at the United Nations?

Mr HASLUCK:
Minister for External Affairs · CURTIN, WESTERN AUSTRALIA · LP

– The honorable gentleman has drawn a wrong inference from the reply I gave yesterday. The position is that there were several votes taken in the United Nations, and before the votes were taken there was a process of amending previous resolutions. Although I knew the votes that Australia had given, I was not quite clear in my own mind what was in the particular resolutions for which Australia had voted. I wanted to check that point. As was weil known, of course, Australia was not called upon to vote in the Security Council because Australia is not a member of the Security Council and I- could have said that yesterday. We were only called upon to vote in the General Assembly.

After the discussion, there were three resolutions. The first one, which was adopted on 12th October 1965, called upon Britain to use all possible measures to prevent a declaration of independence. This resolution was supported by Australia. The second resolution, which also preceded the declaration of independence by Southern Rhodesia, called upon Great Britain to employ all necessary measures, including military force, to bring about majority rule, etc. This resolution was adopted on 5th November 1965. Australia voted against it. The instruction given was that we were not to vote at that stage for the use of military force. The third resolution was adopted on 11th November 1965 immediately following the declaration of independence by Southern Rhodesia. It invited Great Britain to put an end to the rebellion. Australia supported that resolution. The only reference to an oil embargo was in a resolution of the Security Council. Not being a member of the Security Council, Australia was not called upon to vote on that resolution.

page 3105

QUESTION

TRADE

Mr TURNBULL:
MALLEE, VICTORIA

– As the Minister for Trade and Industry is aware, I have often voiced my opposition to certain aspects of the General Agreement on Tariffs and Trade which I claim discourage reciprocal Commonwealth trade. I now ask: Will the adoption of the objectives of the Kennedy Round talks make desirable reciprocal trade between Commonwealth countries still more difficult?

Mr McEWEN:
CP

- Mr. Speaker, I do not think the question really lends itself to a precise answer. But there is a point that I have made in speaking in the House, overseas and in public places. It is this: We have a trade treaty with the United Kingdom under which reciprocal preferential provisions are made. The view of this Government is that we would prefer to stay with the present trade treaty with the United Kingdom than that either Australia or the United Kingdom should chance what advantages might come out of the Kennedy Round negotiations. We have made our position quite clear in that regard.

On the other hand, the United Kingdom has decided to offer to join the Kennedy Round talks on the basis of an offer of a 50 per cent, cut in all its tariffs with very few exceptions. If this offer should proceed to a conclusion on that basis, the end result for Australia would be that many of our preferences in Britain would be cut in half because we have duty free entrance to

Britain and a tariff cut of 50 per cent, would affect the tariff imposed on our competitors’ goods. In those circumstances there would be an imbalance in the trade relationship in the reciprocal provisions as between the United Kingdom and Australia. We would have to try to make good, in negotiations -with other parties, the disadvantages we would suffer.

page 3105

QUESTION

ROYAL AUSTRALIAN NAVY

Mr FULTON:
LEICHHARDT, QUEENSLAND

– Is the Minister for the Navy aware that the couplings used in the operation of refuelling Australian Navy vessels with oil from refuelling points cannot be used in relation to United States Navy ships as the refuelling facilities on United States Navy ships are different from those on our ships? Does the Minister not think that this would present a serious hazard if we were forced into war? Will the Minister look into this question to see whether a uniform type of coupling can be used by the ships of both navies?

Mr CHANEY:
LP

– I was not aware that uniformity did not exist between ships of the United States Navy and the Australian Navy in this regard. I know that the Royal Australian Navy refuels its ships from British tankers in the South East Asian area. I will certainly look into the matter raised by the honorable gentleman and give him a reply later.

page 3105

QUESTION

COPPER

Mr BOSMAN:
ST GEORGE, NEW SOUTH WALES

– My question is directed to the Minister for Trade and Industry and is supplementary to that asked by the honorable member for Ballaarat. I preface my question by stating that the price of alloys has risen by £100 per ton since September - an increase of 33J per cent. Is the right honorable gentleman aware that this spectacular and crippling rise has been attributed to the lifting of the export ban on scrap metal, not only copper but also non-ferrous scrap? Is the Government prepared to reimpose the export ban on scrap copper and non-ferrous scrap to avoid a steep increase in the cost of taps, valves and similar fittings?

Mr McEWEN:
CP

– As I explained in relation to gunmetal, I am not aware of the figures for the various alloys containing copper. I know that broadly higher prices for all the alloys of copper have followed the higher copper price. All I can add to what I said to the honorable member for Ballaarat is that the Government is at all times reluctant to interfere with the completely free flow of commercial activities, but this appears to be a circumstance which will require the Government to consider promptly and seriously where the balance of public interest lies.

page 3106

QUESTION

ROYAL AUSTRALIAN NAVY

Mr BENSON:
BATMAN, VICTORIA

– I address my question to the Minister for the Navy. He will be aware that most ships require refitting every 12 months. I ask: When the D.D.G.’s come to Australia, will they be refitted in this country or will they return to America? Is it the intention of the Navy either to build or to acquire another floating dock which could be used for the purpose of dry docking ships that are operating away from bases where there are dry docks?

Mr CHANEY:
LP

– The D.D.G.’s will have all their refits done in Australia. Certain alterations have had to be made in work shops and in the dock floor at Garden Island so that refits to these vessels can be carried out. By the time the first D.D.G. is ready for its first refit, the yard will be able to handle it. It is not the present intention of the Navy to purchase or build another floating dock.

page 3106

QUESTION

NATIONAL SERVICE TRAINING

Mr JESS:

– I desire to ask the Minister for Labour and National Service a question. Has he seen a report that officers of his Department have been attending a conference in Melbourne with representatives of the Department of Defence to discuss means of obtaining additional entries into the Army under the national service scheme, as exemptions at present are precluding the obtaining of the numbers required by the Army? Is the report correct? If it is, can the Minister give the House more information relating to any shortage and say what action will be taken to rectify the shortage?

Mr McMAHON:
LP

– My attention was drawn to an article which reported that officers of my Department had considered this problem of additional entries into the Army. I do not think the article is correct in fact. Officers of my Department, as in every other department, hold frequent meetings to discuss administrative prob lems. No doubt, such a meeting has recently been held. The general problems of national service training, as they affect my Department, would be discussed at these meetings. However, the increase of the national service intake is not a problem for my Department; it is a problem for the Government and particularly for the Ministry of Defence. A discussion of this matter would not be within the jurisdiction of my Department and I have very grave doubts as to whether a meeting of the type mentioned did take place. The honorable gentleman also asked whether we are recruiting the necessary numbers of national servicemen. I can assure him that exemptions and deferments are not affecting the numbers of national servicemen being obtained to keep up the strength of the Army.

page 3106

QUESTION

HOSPITAL BENEFITS

Mr HANSEN:
WIDE BAY, QUEENSLAND

– My question is directed to the Minister for Health and is supplementary to that asked by the honorable member for Griffith. Is a lower Commonwealth subsidy paid in respect of a patient who has been more than six months in a hospital for the chronically ill? If so, when a patient is being admitted to hospital, are doctors required to indicate the life expectancy of the patient and say whether it exceeds six months?

Mr SWARTZ:
LP

– The classification of a patient in a hospital is related not only to the period for which he is in hospital but also to the classification of the hospital itself and the facilities provided by it. Hospitals are normally registered as such by the State authorities and care for individual patients for only relatively brief periods. Indeed, I think that the average period of hospitalisation throughout Australia is only about eight or nine days. A hospital receives from the Commonwealth Government a subsidy where special account benefit is involved or, under the pensioner medical service, a benefit of 36s. a day. In a case of long term, chronic illness we direct the attention of the hospital to the fact and remind it that long term nursing cases should not be classified as hospital cases. Quite a few hospitals overcome this problem by providing nursing home facilities within the one hospital complex. As an example I mention the Princess Alexandra Hospital in Brisbane. Most of the patients there are classified as hospital patients, but separate wards and facilities are provided for nursing home patients. This is the sort of system that we envisage as being most satisfactory where long term, chronic cases are being treated. When hospital treatment of a terminal case extends beyond what is considered to be a reasonable period the full hospital benefit is paid in any event without question. A problem arises only in long term nursing cases. This problem can be solved by having within the one complex both hospital and nursing home facilities.

page 3107

INTERNATIONAL AID FOR EDUCATION IN PAPUA AND NEW GUINEA

Ministerial Statement

Mr BARNES:
Minister for Territories · Mcpherson · CP

– by leave - Some time ago I announced that the Government was considering the possibility of international assistance for such educational projects in Papua and New Guinea as the new university, the technical education institute, the provision of science laboratory equipment, teacher training and adult education. I now inform the House that two missions from the United Nations will shortly visit Australia and Papua and New Guinea to discuss four projects that might possibly be appropriate for assistance. A joint mission from the United Nations Educational, Scientific and Cultural Organisation and the United Nations Special Fund led by Dr. William Lightfoot, a U.N.E.S.C.O. specialist in teacher training, will explore possibilities for the Special Fund to provide over a five year period staff and equipment for the Institute of Higher Technical Education in the Territory and assistance for the development of facilities for higher level teacher training and educational research. The mission will also consider the possibility of assistance over two years for consultant services for science teaching in Territory schools to be funded under the United Nations Expanded Programme of Technical Assistance and to be carried out with the assistance of U.N.E.S.C.O.

A United Nations Children’s Fund, or U.N.I.C.E.F., and U.N.E.S.C.O. mission comprising Professor T. K. N. Menon U.N.E.S.C.O. Education Adviser, Bangkok, and Mr. Y. C. Chen, Chief of the

U.N.I.C.E.F. Office, Taipei, will discuss assistance from U.N.I.C.E.F. over five years in providing staff and equipment for the development of science teaching in primary and secondary schools in Papua and New Guinea. It is expected that the two missions will spend up to three weeks in the Territory. They will be fact finding and advisory and of course without commitment. Any proposal which was the subject of a request would need to be consistent with the overall objective of the Territory’s balanced development and could not involve unbalancing or distorting policies applying in the particular field concerned, whether education, health, economic development, or some other field of activity. Whether the present missions result in formal requests for aid will be a matter for decision in the light of their visit. But as I have stated previously the Government will not hesitate to take advantage of international assistance when such assistance can make a proper contribution in any field of progress.

I present the following paper -

International Aid for Education in Papua and New Guinea - Ministerial Statement, 24th November 1965 - and move -

That the House take note of the paper.

Debate (on motion by Mr. Whitlam) adjourned.

page 3107

PROPOSED AMENDMENTS TO TRADE PRACTICES BILL 1965

Ministerial Statement.

Mr SNEDDEN:
AttorneyGeneral · Bruce · LP

– by leave - Mr. Speaker, honorable members will recall that the second reading debate on the Trade Practices Bill 1965 has stood adjourned since 19th May in order to afford the public an opportunity to subject its provisions to scrutiny and to make representations. The Government has given close consideration to the representations it has received, and has concluded that certain amendments to the Bill are desirable. I shall formally move these amendments during the Committee stage of the debate - which it will now be appropriate to resume at an early date. However, as it is desirable that honorable members have notice of the proposed amendments before the resumption of the debate, I have today made available to them two documents. One consists of a schedule of the proposed amendments while the other sets out the text of the Bill in a manner that indicates at a glance the changes that are involved. Words that are to be omitted by the amendments are printed in italics. New words are printed in black type. The schedule of proposed amendments is available at present on the table. Copies of both the documents that I have mentioned and copies of this statement will forthwith be distributed to honorable members at their lockers to make it simpler for honorable members to obtain this material and to assist the parliamentary officer in charge of papers.

For the most part, the proposed amendments are self explanatory. Many of them involve no change of substance, their purpose being merely to make the text clearer and more certain in meaning. Some will make explicit what is at present implicit. However, some of the proposed amendments do go to the substance of the legislation, and the House will be assisted if I take this opportunity to make an explanation of them now rather than wait until they are moved in Committee.

One of the more important changes of substance provided for by the amendments will make it possible for members of the Trade Practices Tribunal to be appointed to serve on a part time, instead of a full time, basis. The Government has concluded that this change is necessary because the work of the Tribunal will not be likely, particularly in the early stages of the operation of the legislation, to occupy its members full time. There will probably be some periods when the number of inquiries before the Tribunal will require it to sit continuously. But there will be other periods when there will be no matters immediately ready for hearing and therefore no need for the Tribunal’s services. I point out in this connection that many of the investigations undertaken by the Commissioner of Trade Practices and his staff will not lead to inquiries by the Tribunal. In some instances, the investigations will serve to satisfy the Commissioner that there is no need for proceedings, while in others the need for a Tribunal inquiry will be removed by successful consultations under clause 48 or by the abandonment of agreements or practices that the parties themselves have come to conclude have little prospect of being found to be compatible with the public interest. There is in the Bill provision to enable parties to give undertakings to the Tribunal during the course of a hearing. An undertaking might be given at a very early stage of a hearing. If this were to happen there could be left a gap, so to speak, in the matters before the Tribunal ready for hearing.

From what I have said honorable members will appreciate that, if the members of the Tribunal had to be appointed to serve on a full time basis - that is, on terms requiring them not to engage in other employment - there would be periods when they would be without any work to perform. The Government has accordingly concluded that there is a need for the Bill to be amended so that members of the Tribunal can be appointed on terms that do not forbid them from being engaged in other employment when their services on the Tribunal are not needed. The proposed amendments accordingly provide for the repeal of clause 17 and for certain consequential, amendments to clause 11.

The provision in clause 11(1.) for a member to be appointed for a specified period of years is not to be changed. There will thus be a panel of members appointed for specified periods, and, as circumstances require, divisions of the Tribunal will be constituted from the members on the panel. In deciding that the Bill should be amended to permit members of the Tribunal to serve on a part time basis, the Government has been conscious of the importance of the Tribunal’s functions and of the need for it to be constituted by men of the highest calibre. In case honorable members might consider that the proposed amendment might make it difficult to find persons of the appropriate calibre who are willing to accept appointment, I would reassure them by saying that it should have precisely the opposite effect. The Government will be able, and in fact it proposes, to appoint as the presidential members persons who are already of judicial status. When the services of these persons as members of the Tribunal are not required, they will resume their normal judicial duties. For the other members, the Government will be able to draw upon the services of persons who, after distinguished careers in the business world, have ceased to have responsibilities that are incompatible with membership of the Tribunal.

Clause 37 (1.), which deals with monopolisation, has been re-drafted. The differences between the existing and the proposed provisions are as follows: First, the existing provision refers to a person “ in a dominant position in a line of trade or commerce in Australia “. The proposed provision refers instead to a person “in a dominant position in the trade in goods of a particular description, or in the supply of services of a particular description in Australia “. The meaning of the new words is more certain, but no change of substance is involved.

Secondly, clause 37 covers three specific classes of conduct. The two classes covered by existing clause 37 (1.) (a) are qualified by the introductory words “ by virtue of, or for the purpose of maintaining his dominant position “, while the corresponding qualification of the class covered by section 37 (1.) (b) is that the person concerned “ takes advantage of his dominant position “. Under the proposed amendment, these distinctions between the qualifications that are applicable to particular classes of monopolisation conduct are removed. Whatever class is involved, it will be necessary that the person concerned “ takes advantage of” his dominant position. The phrase “ takes advantage of a dominant position “ appropriately describes the basic ingredient of the Government’s conception of monopolisation, and possible confusion will be avoided by dropping the other phrases to which I have referred.

Thirdly, the class covered by clause 37(1.) (a) (i) has been denned in the amendment with more precision. The class is confined in terms by the amendment to inducements to refuse to deal. The inducements covered by the provision are to be examinable if they are resorted to by persons taking advantage of their dominant positions. Honorable members will have in mind that other inducements to refuse to deal are examinable by virtue of clause 36(l.)(c) if they are by a trade association or by a person acting in pursuance of an agreement with another. The trade association or the agreement in clause 36(l.)(c) is the correlative to the dominant position in clause 37 (l.)(a)(i).

Fourthly, existing clause 37(l.)(b) has been re-drafted in the light of representations that, in its present form, it might be construed as being applicable on every occasion on which a person in a dominant position fixes or determines his prices or terms of conditions of dealing. This, of course, was never intended. The proposed amendment makes it clear that the provision is applicable only when the prices, or conditions of dealing constitute impositions in the sense that they would not be possible if the persons fixing them were not in their positions of dominance. The re-drafted provision appears in the amendment as clause 37 (l.)(c).

Fifthly, existing clause 37 refers to “ a part of Australia” without specifying any test that the Tribunal is to apply in selecting such a part. Apprehension that the Tribunal might find that, say, a country town is a “ part of Australia “ will be allayed by the insertion of a new provision, clause 37 (1A), which expressly directs the Tribunal not to take as “ a part of Australia “ an area that does not include the whole of a State or Territory unless it is satisfied that it is appropriate to do so having regard to the substantial size of the area and its significance as a market area.

Provision for the Commissioner to furnish to the Attorney-General, for presentation to the Parliament, an annual report with respect to his operations under the Act is contained in a new clause, clause 104a. Similar provisions are to be found in many other acts conferring powers on statutory officers.

In my second reading speech I indicated that the Government was giving consideration to the provisions needed to deal with trade practices in relation to ocean shipping. I referred then to the fact that there are a number of special problems associated with the framing of such legislation. While the Government has made much progress in its consideration of these complex problems, there are some aspects of the legislative proposals it has in mind to deal with ocean shipping which call for further consideration before the proposals are introduced into this House. The Government is mindful in this connection of the need to avoid any precipitate action which could have harmful effects upon shipping services or upon our relations with other countries. Accordingly, the Government has decided to defer the introduction of its ocean shipping proposals until the next session of Parliament. In the meantime, ocean shipping will remain subject to the Australian Industries Preservation Act 1906-1950 and will be excluded from the operation of the present Bill. The necessary amendments for this purpose are proposed in clauses 4 (1.) and (2.), 38 (i) and 39 (2a).

Proposed clause 4 of the Bill provides for the repeal and amendment of relevant provisions in the several acts by virtue of which the Australian Industries Preservation Act is at present applicable in the Australian Capital Territory and in the Northern Territory.

There is the definition in clause 35 (2.) of businesses competitive with each other. It is proposed to amend this clause so that businesses that are merely “likely to become “ competitive with each other are not treated as already being so competitive.

Exemptions are proposed in respect of two classes of exclusive dealing conditions. One of the classes covers arrangements by which a person obtaining a lease or licence of land agrees to acquire from the owner of the land goods or services required in connection with the conduct of a business on the land. The other class covers arrangements by which a person borrowing money or obtaining credit for the purpose of carrying on a businsess agrees to acquire from the person providing the finance, while the loan or credit is outstanding, goods or services required for the purposes of the business. Neither exemption is to be applicable to a condition that is imposed by a trade association or by a person acting in pursuance of an agreement with a third person. As unilaterally imposed exclusive dealing conditions are not examinable under the Bill except in relation to monopolisation, the practical effect of the amendments will not be great. They merely recognise that there are limits to the extent to which the legislation should go in preventing an owner of property from disposing of it subject to conditions.

Amendments are proposed to ensure that an application to the Commissioner for an extension of time within which to register an agreement does not prove to be ineffective because of an inability on the part of the Commissioner to deal with it before the expiry of the normal 30 day period.

Under a new provision, to be inserted as clause 42 (8.), an application for extension of time will need to be made within the thirty day period, but once it has been made, the time for registering will not expire until at least 14 days after the Commissioner has informed the applicant of his decision. This provision will not preclude the Commissioner from granting such longer extension as may appear to him to be warranted in the circumstances.

A proposed new provision, clause 48 (3.), provides for consultations under clause 48 to be conducted on a without prejudice basis, if a party to the consultations, other than the Commissioner, indicates a wish that they should be conducted on that basis. Statements, admissions or offers made in consultations conducted on a without prejudice basis will not be admissible in proceedings before the Tribunal except with the consent of all the parties to the proceedings.

It is proposed to enable a person with whom the Commissioner has been having consultations under clause 48 to ensure, after the consultations have been in process for a reasonable time, that the question whether the relevant agreement or practice is contrary to the public interest is not left in a state of uncertainty. The new provision, which is to become clause 61 (2.) (b), will enable such a person to obtain an order from the Tribunal directing the Commissioner to institute proceedings in respect of the agreement or practice.

Proposed amendments to clauses 55 and 56 indicate the circumstances in which the Commissioner may institute proceedings in respect of an agreement or practice that has already been terminated. The amendments require that a presidential member of the Tribunal must be satisfied that there are reasonable grounds for believing that if proceedings are not instituted, another agreement or practice similar to the one that has been terminated will be entered into or engaged in.

Proposed amendments to clauses 55 and 56 provide for the Tribunal to have a discretion to decide whether proceedings should be continued if the relevant agreement or practice is terminated or varied while the proceedings are in process.

It is proposed to amend clause 61 to enable a negative clearance to be obtained even though n» new capital is to be employed in the venture for which the clearance is necessary.

Another proposed amendment provides for the insertion of a new provision, clause 61 (3b), under which a negative clearance under that section will remain effective for such period as is specified in the instrument granting it, being a period of not less than five years. After the specified period the effectiveness of the clearance will depend on there being no material change of circumstances.

Under the proposed amendment to clause 62 the members constituting a Review Division are not to include the presidential member who presided over the proceedings under review.

The proposed amendment to clause 66 (2.) withdraws the discretion which the Court has under the existing sub-clause to decline, for special reasons, to answer a question of law referred to it by the Tribunal.

Amendments are proposed to strengthen existing provisions to protect the rights of persons not in breach of the legislation. Amendments to clause 51 will emphasise that a determination that an agreement or practice is contrary to the public interest has only a prospective operation. They will also make it clear beyond doubt that the mere making of such a determination does not affect the legality or enforceability of transactions entered into in pursuance of the relevant agreement or practice.

An amendment of clause 69 will ensure that the rights of persons who are not in breach of the legislation are protected irrespective of whether those rights arise out of, or are merely dependent upon, transactions involving breaches by other persons.

Amendments to clause 97 will make clear that the public are to have access to the record of the Tribunal - subject only to any direction that may have been given under clause 73. A related amendment, to clause 49 (2.), will require determinations of the

Tribunal to be recorded in the records of the Tribunal.

It is proposed to insert a new provision, clause 86 (3a), under which it will be a defence to a prosecution for collusive bidding if the defendant satisfies the Court that the agreement in question was not made for the purposes of a particular auction and that it had been registered and not found by the Tribunal to be contrary to the public interest. An almost identical provision in relation to collusive tendering is already contained in the Bill in clause 85 (4 ).

Proposed amendments to clause 87(1.) ensure that agreements between partners in relation to the terms of their partnership and agreements between trustees in relation to the conduct of a business carried on by them as such trustees do not fall within the definitions of a collusive tendering agreement or a collusive bidding agreement.

As the present Bill is unlikely to become law before the Decimal Currency Bill-

Mr Whitlam:

– Will we not get it through this week or next?

Mr SNEDDEN:

– But it will not become law. As I have said, as the present Bill is unlikely to become law before the Decimal Currency Bill, there will be a need for amendments to convert the penalties in this Bill to decimal currency. The amendments that are necessary for this purpose will be moved in Committee, although they are not shown on the schedule of ‘amendments that 1 have distributed.

Mr. Whitlam__ While thanking the

Attorney-General for the helpful statement and memorandum that he has just given us, might I ask whether, before the debate resumes, he will be able to give me an answer to the question I asked him on 1 4th September concerning negotiations with the States and supervening practices which have come to his notice or that of other Government bodies?

Mr SNEDDEN:

– I would hope to be able to provide the honorable gentleman with an answer to so much of the question as I am able to answer some time tomorrow morning.

page 3112

UNIVERSITIES (FINANCIAL ASSISTANCE) BILL (No. 2) 1965

Second Reading

Debate resumed from 18th November (vide page 2895), on motion by Sir Robert Menzies -

That the Bill be now read a second time.

Mr BEAZLEY:
Fremantle

.- This Bill arranges for Commonwealth grants for capital works at medical teaching hospitals amounting to £1,555,850 and for further grants amounting to £184,900 for the recurrent costs of those hospitals directly attributable to the instruction of undergraduates. This makes a total of £1,740,750. 1 move -

That all words after “That” be omitted with a view to inserting the following words in place thereof: - “whilst not opposing the passage of the Bill the House is of opinion that the Government should adopt the recommendations concerning University dental schools by the Committee on Teaching Costs of Medical Hospitals.”

The Prime Minister (Sir Robert Menzies) mentioned in the course of his second reading speech that the Government had accepted some of the items in the report of the Committee on the Teaching Costs of Medical Hospitals but had not accepted others. A number of the recommendations in the second report of the Committee on Teaching Costs of Medical Hospitals to the Australian Universities Commission have been rejected in this Bill. The Opposition has an open mind on some of these questions - for instance, the recommendation for the payment of honorary medical staff in teaching hospitals who give their services to teaching. This would cost over the triennium 1964 to 1966 about £1,500,000. No doubt it is this cost of about £500,000 a year that has discouraged the Government’s acceptance of this recommendation. Honoraries have an ancient tradition of attending patients free, but teaching university students free, whilst a noble public service, must make heavy inroads on their time and earnings. We have no. settled view on the rejection of this recommendation although it does appear that non payment is not just and perhaps non payment is not likely to continue.

What we cannot understand are the rejection of the whole section of the report on dental schools and hospitals and the continuing neglect by the Government of the question of dental health not only in this measure but in the national health scheme. The report, in paragraph 4,24, indicates that all is not well in the dental profession. It states -

Because in most Australian schools the teachers have been, for one reason or another, unable to carry out research, or have not been interested in it, the undergraduate has not made this vital contact. The overall result is seen today in the general apathy of the profession towards the necessity for research and training in research methods.

I think the dental profession rejects this view, but at any rate the recommendation that has been made to the Government does establish that there is an unsatisfactory situation in the dental profession. I will quote figures shortly to show that there is certainly an unsatisfactory ratio of dentists to the Australian population.

The report also points out that teaching of dentistry requires a very high staff-student ratio, and in the quaintest terms the Committee explains why this is so. Its logic seems inescapable. In paragraph 4.25 of the report the Committee states -

Teaching in dental schools and hospitals requires a high’ staff-student ratio for its consists of demonstrating operative procedures on patients. Because of the small size of the oral cavity, only the operator can see what he is doing at any one time, and, when teaching, he has to change position frequently to demonstrate each step of the treatment. This procedure requires concentration and is tiring to both patient and operator for obvious reasons it cannot be prolonged.

It is not very easy, in other words, for a great number of students to crowd around a mouth, and one therefore needs a high staffstudent ratio. I think the logic of that is inescapable. We have also learned that the costs of a five year course in dentistry are about equal to the costs of a six year course in medicine and that the number of people entering the profession is not adequate for the needs of the Australian community. We therefore cannot understand why the section, of the report which recommends an expenditure of £897,000 has not been adopted by the Government.

The report covers each State and in paragraph 4.58 the Committee refers to unsatisfactory conditions in New South Wales and states -

Because of overcrowding, inadequacy of accommodation, and lack of essential equipment and lighting, the University was invited to submit a revised proposal for assistance designed to improve the clinical instruction of dental students in the present biennium. The- Committee subsequently received a new submission requesting assistance for extending the sixth floor over the existing fifth floor operative dentistry clinic in order to provide urgently needed office and laboratory accommodation for teaching staff. In the revised submission the University also requested assistance for the provision of up to date lighting of 200 dental units used by students, air-turbine cutting equipment for 100 chairs used by students, closed circuit television, and air-conditioning of the existing lecture theatre. The Committee regarded the provision of these facilities, except for the closed circuit television, as essential, and accordingly recommended an appropriate grant.

  1. should have thought that closed circuit television was one means of overcoming the disability that many students cannot see at the same time into the small oral cavity. Therefore the Committee cannot be accused of recommending the ultimate luxury in dental teaching, since it does not recommend that facility. However, its recommendation, which is also covered in the table of costs at the end of its report, likewise has been rejected. I refer now to another important recommendation which has been rejected. After saying how satisfactory the situation was in Melbourne, in paragraph 4.63 the Committee states -

The Committee decided, however, that there was a case for providing a small grant to improve facilities in the Children’s section of the Department of Conservative Dentistry and to provide some equipment for the Department of Dental Prosthetics.

This, again, seems reasonable. About Queensland, in paragraph 4.70, the Committee states -

After careful consideration of all the aspects of this problem and after further discussions, the Committee recommended a substantial grant to enable adequate dental teaching facilities to be included in a new dental building to be constructed alongside the existing Dental Hospital on Turbot Street.

The State of South Australia had an important programme, and in paragraph 4.74 the Committee said -

The total cost of the proposed- building was estimated at £1,144,000 of which £835,120 was claimed as being directly attributable to providing accommodation and facilities for teaching dentistry, and the remainder to hospital services. The problem of differentiating between the cost of providing teaching facilities and hospital services in a jointly occupied building is not new to the Committee who decided to recommend a substantial grant towards the provision of dental teaching facilities in the proposed new area of the existing building.

Finally, in a table that itemises the grants, the Committee recommended for the University of Sydney, £56,000; for the Uni versity of Melbourne, £41,000; for the University of Queensland, £400,000; and for the University of Adelaide, £400,000 - a total of £897,000.

For some reason or other a prestige appears to be accorded to the doctor which is not given to the dentist. If I examine my own heart in this matter I can certainly say that I develop a tremendous warmth for the doctor who comes into my home when there are emergencies affecting my children, but I do not like the dentist, whom I have to visit deliberately - he does not come to my home in an emergency - in unpleasant circumstances. In television programmes we have Dr. Kildare and Dr. Casey. It is possible for the producers to put them through a great variety of adventures and maintain public interest, but if ever a dentist is depicted on the screen it is always in some farce, either connected with laughing gas or with some humourously horrifying vision of a person towering over a mouth with forceps. It seems to me that it may be that the constant ignoring of dentists and dentistry in our national health scheme, and now in this measure, may have some such psychological foundation.

Every provision that we make for health leads to an increased demand for more legislation for health. It is a snowballing demand. The more medical science prolongs life, the more people have, need of the dentist, pharmacist and the doctor. In 1901 when the expectation of life was 52 years there would be less need of a doctor than there is today when the expectation of life is about 70 years. The more the patient’s life is prolonged the more he will have need of health facilities so we must face up to the fact that there will be a constantly rising demand for those facilities. But we do not face up to the rise in demand for dental facilities and a serious situation is developing in this field. The report to which I have referred, while showing that in Australia the ratio of dentists to population was unsatisfactory in comparison to the position in Scandinavian countries, the United Kingdom, the United States and New Zealand in 1956, does not give the recent position. Let me show honorable members how the ratio in Australia has deteriorated over the last three years. In 1 963 the ratio of dentists to population was 1 to 2,531. In 1964 it was 1 to 2,551. In 1965 it 1 to 2,585. It is constantly deteriorating. The situation in certain States is more serious than the Australian average. For instance, Tasmania which in 1963 had 1 dentist to 4,002 people now has 1 dentist to 4,113 people. South Australia which in 1963 had 1 dentist to 3,315 people now has 1 to 3,390. In Victoria the ratio has gone from 1 to 2,998 in 1963 to 1 to 3,136. The Australian armed Services, in dealing with young soldiers - not a section of the population characterised by the worst dental health - considers that 1 dentist to 1,000 persons is the proper ratio. Yet we have States such as Tasmania where the ratio is 1 to 4,113. Bear in mind also that in the States you are not dealing only with young men but also with children and other people in the greatest need of protective dentistry.

We therefore regret deeply that the Government has not seen fit in this legislation to provide for the same kind of dental education in meeting the costs of dental hospitals as it is providing for medical education. We note that the Government has accepted a good many of the recommendations of the Committee. For instance, it accepted the recommendation about library books. I think a case can be made for the Government’s action some time ago in rejecting the recommendation that a grant of £625 per head of medical students be made and, instead, adopting the policy of meeting actual itemised administrative costs associated with teaching hospitals. A case can be made for all those kinds of modifications of the recommendations of the Committee on Teaching Costs of Medical Hospitals, but we cannot understand why so constantly nothing is done in the Government’s decisions about dentistry. Entries into the dental profession recently numbered 276 and there were 127 graduations.

Mr Reynolds:

– That is the average over 10 years.

Mr BEAZLEY:

– I thank the honorable member. The figures show a serious leakage. At present the movement of dentists out of the country has been stabilised. There are about 500 Australian dentists practising in the United Kingdom. This trend of Australian dentists going to the United Kingdom is not continuing at its early post-war rate, but still not sufficient men are being attracted to the profession. The Government recently justified its action in introducing fluoride into the water supply in Canberra on the ground of the serious state of dental health of children in this Territory. Children in the Territory would belong to a group which in nutrition and parental care stands above the norm of the Australian community. Notwithstanding that, the Government was concerned about the dental health of children here - not to the extent of assisting the dental profession in the ways that we propose by our amendment but at least to the extent of introducing fluoride into the water supply. The Government’s case in regard to dental health when fluoride was introduced in Canberra should remind it that it needs to revise the national health scheme in the direction of dental health. If the Government is to revise the scheme to strengthen the dental health of the Australian community, it must pay the same attention to dental education as it is now paying to -medical education.

Mr DEPUTY SPEAKER (Mr Falkinder:
FRANKLIN, TASMANIA

– Order! Is the motion seconded?

Mr REYNOLDS:
Barton

.- I second the motion. I support the amendment moved by the honorable member for Fremantle (Mr. Beazley). I am disappointed to learn that no Government supporter intends to participate in the debate.

Mr Turnbull:

– How does the honorable member know that?

Mr REYNOLDS:

– That is the advice I have been given.

Mr Turnbull:

– The honorable member should be careful about accepting advice.

Mr REYNOLDS:

– Does the honorable member for Mallee intend to speak?

Mr Turnbull:

– Yes.

Mr REYNOLDS:

– I am glad. I was disappointed at the prospect that no Government supporter would take part. I hope that the Minister for Shipping and Transport (Mr. Freeth), who is now at the table, will be sufficiently briefed to be able to answer some of the queries that may arise during the debate. I hope that we will not have the experience that we had last Friday during the debate on the States Grants (Research) Bill when a number of queries were raised to which no answer was forthcoming because presumably the Minister concerned had not been briefed on the matter. During that debate I asked whether the Robertson Committee, which made recommendations in regard to grants for research, was to be a permanent committee or an ad hoc committee. At no stage in the debate did the Minister then at the table intervene to answer my queries or any others raised. The matters about which information was sought were important matters. The honorable member for Fremantle rightly highlighted the Opposition’s objection to the Government’s failure to adopt the recommendations of the Committee on Teaching Costs of Medical Hospitals in relation to dental schools. The honorable member dealt with this matter at some length. I will have more to say about it later.

I would not want to be understood to be suggesting that the Opposition is happy with the grants that the Government is making to teaching hospitals. In the first place I am disappointed that this Bill is before the Parliament only at almost the end of the second year of the three year period with which we are supposed to be dealing. Almost two thirds of the relevant period has elapsed. Admittedly the Bill provides for the operation of the current grants as from 1st July 1965 but as honorable members well know, there is to be no provision for the first half of the triennium. If we are to have this three year grant we would expect the recommendations and the legislation to come before us at the beginning of the three year period, not almost at the end of the second year of the period. This situation must make it difficult for hospitals and university authorities to make any worthwhile plans.

Already it has been necessary for the Prime Minister (Sir Robert Menzies) to state, as he did in his second reading speech, that probably something like £800,000 less will be spent on the capital provisions, simply because it is now expected that some hospitals will not be able to carry out the programmes for which they received sanction from the Committee that inquired into these matters. I suggest that probably the reason is that the Government has made its decision so late that those hospitals are not able to get the work done according to the prescription laid down by the Prime Minister, namely, that the work be either completed or nearly completed by the end of 1966.

One of the aspects of this matter that surprises one a little is that the first inquiry made by the Committee set up by the Universities Commission for this task was made in the form of a questionnaire sent out to the vice-chancellors in December 1963, just a month before the commencement of the triennial period. If is no wonder that we are now more than half way through the period before getting to this point of action. The questionnaire was sent out and it had to be followed up, as the Committee tells us, by members of the Committee themselves going to each of the teaching hospitals and dealing with each of the universities concerned. In their answers to the questionnaire the universities had made requests for capital grants of something of the order of £9 or £10 million, and this, of course, was far too much for the Government to stomach. Presumably the Committee itself thought it would be beyond the physical resources of the universities to carry out the work in the time, so the Committee had to send representatives to each university and teaching hospital that had requested assistance and negotiate with them on these matters. I notice that the report says that the members of the Committee had to explain again at length that what the Committee was inquiring into was requirements for undergraduate clinical teaching only, although back in 1961 the Committee that was then operating made its first report and said that a consideration of the costs of postgraduate training might be a task for the Committee in the future.

Here we see one of the great limitations of this whole report and of the Government’s recommendations, which deal only with undergraduate clinical teaching. Anyone who reads the report in any kind of detail will appreciate some of the difficulties that the Committee members encountered in their negotiations with the various teaching hospitals. There was the difficulty of isolating facilities required for undergraduate training from those required for postgraduate work or for research. This is of course, to ignore the fact that the distinction is quite illogical on sheer educational and economic grounds.

The impression that I have gained from reading the report, particularly the plO.visions for recurrent costs, is that there has been a severe trimming down of the requests and a further trimming down in the subsequent adoption by the Government of only some of the recommendations. I have a suspicion that the Treasury imposed severe limits on the Committee as to what it was empowered to accept. I will elaborate that as I go through and look at some of the particular items.

Dealing first with recurrent expenses, the first limitation, as I have said, is that only half the triennium is covered. There are no retrospective grants to the universities and teaching hospitals for the recurrent costs they were involved in for the first half of this triennial period. We have to remind ourselves that a previous inquiry took place in the period 1959-61. That was a fairly extensive inquiry into what were identifiable teaching costs in respect of these recurrent expenses or recurrent items. The Committee came up with a formula, as already mentioned by the honorable member for Fremantle, that would have resulted in a grant of £625 per annum per undergraduate clinical student in a teaching hospital. This was unacceptable to the Government - I suspect mainly because of the size of the amount of money the Commonwealth would have had to provide. If the Commonwealth had adopted that recommendation, for the three-year period covered by that inquiry, 1961-63, the cost would have been £3.6 million for recurrent expenses. One might now compare that £3.6 million with what the Commonwealth is accepting as its share of the recurrent expenses for this triennium. The Bill gives us the information that the Commonwealth is to provide, in this triennial period, £184,900, as against the total recommended grant for the previous triennium of £3.6 million. The Commonwealth’s share of that £3.6 million, incidentally, would have been £1,273,700. So what the Commonwealth is providing in this 18-month period represents just 14 per cent, of what it would have been required to accept for the triennial period 1961-63 if it had accepted the recommendation covering that period.

In this Bill the Commonwealth is accepting only three items out of the six that have been identified for the purpose of recurrent expenses. The six items dealt with the cost of paying honorary staff in teaching hospitals, provision for indirect costs - I will come back to that in a moment and elaborate - the cost of recompensing hospitals for teaching done by members of the hospital staff - doctors on the staff and other personnel - provision for administrative costs, maintenance and service charges and library charges. All of these assessed identifiable teaching costs, as recognised by the Committee, would have amounted to a total for the three-year period 1964-66 of £4,216,900. That is what the total bill would have been. As against that the Commonwealth is providing £184,900, or 4.4 per cent, of the costs that have been assessed and identified by this Committee.

To be honest about the matter, I have to acknowledge that the Committee did not recommend acceptance of all these items. It recommended acceptance of four out of the six. It made no recommendation in respect of the second and third items I have mentioned, one of which was indirect costs, which included a proportionate payment for nurses, for pathology, bacteriology and biochemistry facilities, for anaesthetics, radiology, clinical photography and medical records. These services all cost much more in a teaching hospital than they would cost in an ordinary hospital. The Committee made certain assessments. I will not go through the details. They are all in table 6 of the report. I will just give one example and say that 1 per cent, of the salary of nurses was assigned as a teaching cost, and 25 per cent, of bacteriology and biochemistry costs. The Committee set these proportions and it said that it regarded the costs allotted as being very conservative.

Not only did the Committee not recommend acceptance of indirect costs; it also did not make a recommendation in respect of the costs of recompensing hospitals for teaching done by hospital staff members. In respect of the indirect costs, the Committee did go into details and said that there were clearly identifiable teaching costs, and it thought that there would be in respect of indirect costs an amount of £1,304,000 for the three-year period. But for some reason or other not stated in the report the Committee did not recommend acceptance of that item. Why? It stated that the costs were clearly attributable to the teaching functions of the hospitals, yet it said it was not prepared to make a recommendation. I wonder why it did not. Presumably if the Commonwealth is not to accept its share of doing this job either the whole burden will be saddled on the States or the job will not be done to the extent that it ought to be done.

In respect of the second item I mentioned - the cost of recompensing hospitals for teaching done by hospital staffs - the Committee estimated the cost for the .three year period 1964-66 to be £362,100. Again it said that this was clearly an identifiable item that could be isolated as being attributable to the teaching functions of the hospital but only in respect, as I said earlier, of its undergraduate teaching functions. Yet again the Committee did not make a recommendation. Was it told by the Treasury, by the Prime Minister (Sir Robert Menzies) or by the Minister in charge of Commonwealth Activities in Education and Science (Senator Gorton) not to make a recommendation? For some reason which it does not state the Committee did not make a recommendation in these matters. As I have said, the Committee assessed the total cost of the teaching functions in these teaching hospitals in respect of undergraduate clinical teaching at £4,216,900. Yet only 4.4 per cent, of that total cost is being met by the Commonwealth grant provided in this Bill.

The Committee, on the other hand, did recommend acceptance by the Commonwealth of the item covering the cost of paying honorary medical staff in teaching hospitals. As the honorable member for Fremantle (Mr. Beazley) rightly said, members of the Labour Party have an open mind at this stage on that matter. We take cognisance of what the Committee said, namely that not to recompense these doctors, and just to rely on their honorary capacity is an anachronism. It is something that does not happen in respect of tutors or teachers who carry out such services for any other faculty at a university. This raises the question as to why doctors - busy people at this level - should be expected to provide teaching free of cost. The Committee did make some mention of the fact that in some universities an honorarium is paid to such doctors. The assessed value for the three year period of the teaching functions carried out by these honorary doctors was £1,524,000. The Committee in this case recommended acceptance of the item by the Commonwealth, but the Commonwealth, on behalf of itself and presumably on behalf of the States, has rejected that.

The Commonwealth has accepted just about in total the recommendations of the Committee regarding capital expenses. The Committee recommended that capital costs be reimbursed to the extent of £3,861,055. The Commonwealth has accepted responsibility for a substantial part of that. It has accepted that its share on a £1 for £1 basis would be nearly £3.9 million, but it is going to pay only £3.1 million because, as we were told in the second reading speech of the Minister, some of the hospitals now find that they are unable to carry out the programmes for which they received approval. As I said before, I can imagine one cogent reason for that. It is that the hospitals have been in the dark about whether their requests would be finally accepted by the Government, and now they are getting the green light on this only when half the triennial period has elapsed.

In relation to capital expenses there are a couple of other points in the report that I should like to mention. Claims were made by some hospitals for retrospective payments in regard to the 1961-63 triennial period. I have a particular interest in this aspect because of the presence of a teaching hospital in my own electorate. I refer to the St. George Hospital which is linked with the University of Sydney. It would be one of the hospitals that made this request. The St. George Hospital had not engaged in teaching functions at the time the last triennial grants were made. It was stated then that the Government was not prepared to make a grant to any hospital that was not a teaching hospital at the time that the triennial grant was made. The St. George Hospital’s teaching functions commenced. I think, either late in 1962 or at the beginning of 1963 and the hospital had to carry out capital works and engage in planning for the expansion necessary to cater for these teaching functions. It received no help from the Commonwealth but it expected that when the next triennial period came along it would be successful in a claim for the proven costs connected with capital construction for teaching purposes. But this hospital, along with other hospitals that made similar requests, had its request rejected by the Committee and, of course, by the Government.

Another item I find it a little difficult to understand is the rejection of a claim in respect of the provision of alternative facilities for groups other than clinical students caused by the vacation of certain premises by these groups in favour of students. Let me give a simple instance. Some rooms were vacated by nurses in order to make facilities available for clinical students. A justifiable application was made to the Committee on the ground that where nurses vacate their rooms to make way for student doctors the Committee and the Commonwealth ought to be prepared to accept the cost of making alternative facilities available for the groups that had to vacate the premises as a justifiable expense. But in this case the claim of the hospital was rejected. A hospital might be forgiven in the future for saying that it was not going to make way for students but would wait until it could build premises specifically for students and the lecturing staff, together with library facilities and other things necessary in teaching.

The claims of some hospitals were rejected because the hospitals could not carry out the full programme recommended. Hospitals in this category included the Royal Hospital for Women which/ is connected with the University of New South Wales. It had a capital grant of £40,000 approved, but instead of getting £40,000 it is only to get the £5,000 that is provided for in this Bill. The Mercy Hospital in Melbourne, which is connected with the University of Melbourne, had approval for a capital grant of £120,000, but instead it is to receive only £20,000 under this Bill. As I have said, there is to be a cut down on capital grants in this Bill amounting to approximately £800,000. As I have said twice before presumably this is because certain hospitals received acceptance of their requests too late for them to carry out the task of constructing the necessary facilities.

The total cost of all the items that have been assessed as being connected with teaching functions in hospitals and dental schools, contained in the Committee’s report, amounts to £8,984,955- almost £9 million - but all that is to be provided by the Commonwealth and the States combined is £4,237,740. In other words, only 41 per cent, of the indentifiable items connected with teaching functions are covered in this Bill - considerably less than half. The Commonwealth itself will provide, towards the assessed teaching costs of nearly £9 million, an amount of £1,740,750, or 19.4 per cent, of the total amount.

The honorable member for Fremantle stressed what the Commonwealth was not doing in respect of dental hospitals. There is also a considerable deficiency concerning Commonwealth activity in respect of teaching hospitals especially with regard to recurrent costs. As far as dental schools are concerned, the honorable member for Fremantle rightly said that the recommendation was in respect of capital grants only. The Committee inquiring into- the teaching costs of medical hospitals said that it was not prepared at this stage to look at recurrent grants. It was looking at only the capital costs. In that respect, £897,000 - nearly £900,000 - was recommended of which half was to be provided by the Commonwealth and half by the States concerned. In this case, for sheer financial reasons, the Commonwealth has been frank. It said that because of its other financial commitments it was not prepared to accept this recommendation. We are very critical of this decision because of our own knowledge of what is contained in this report and what has been told to us by the Australian Dental Association about the atrocious lack of facilities with regard to dental schools and dental hospitals.

The question which comes to my mind is: How can this position exist in respect of dental schools? As stated in this report dental schools are an integral part of our university system. Why have they not been properly catered for in the normal provisions of the Australian Universities Commission? Is this because the Faculty of Dentistry is somewhat backward in making its requirements known to the Australian Universities Commission? Is it because the Australian Dental Association has not the prestige, power and authority that the Australian Medical Association has? I think the Australian Dental Association would accept the view that it is not a powerful body in the community when compared with the Australian Medical Association. I believe the Australian Dental Association has a very recent history in the Federal sphere. This seems to tie in with the fact that we cannot persuade the Government to make dental facilities part of our national health scheme and to provide every kind of health facility in the community. Here we get an outright rejection of even the modest and only partial requirements of the Faculty of Dentistry.

The honorable member for Fremantle quoted from paragraph 4.17 of the Second Report of the Committee on Teaching Costs of Medical Hospitals in which there is reference to the poor postgraduate facilities. This matter was not even considered by the Committee because it was told it was to look at only the undergraduate facilities. The Committee reports on poor research facilities with little co-ordination. The report says that there is poor stimulus for research within the faculty. It says that the teaching at university schools of dentistry is uninspired because there is so little research behind the teaching in the faculties. At paragraph 4.24, the report says -

The overall result is seen today in the general apathy of the profession towards the necessity for research and training in research methods.

The Australian Dental Association claims that the position is not as bad as that and says that there is not quite the apathy referred to in the report. But we find in paragraph 4.30 the statement - . . the clinical status of dentistry in Australia is relatively low.

In another part of the same paragraph we find-

In other countries, the output of dental scientific papers from Australia is known to be low.

Australian dentistry has a low international status. Yet dentistry is to be left without any help under the provisions of this Bill despite the recommendations of the Committee on Teaching Costs of Medical Hospitals.

The honorable member for Fremantle has indicated how inadequately served the Australian community is by the number of dentists which are available in it. The report indicates, at least by implication, that one of the reasons why we are not getting the number of dentists we need is that the national health scheme in Australia does not include this aspect of health within its province. On the other hand, the British national health scheme takes dentistry into account. The Australian Dental Association contests the opinion that the reason for the shortage of dentists in Australia is that our dentists go overseas to practice. The Dental Association says that the number of Australian dentists overseas remains fairly static at approximately 500. The real problems are, first, that dentistry has not the social and economic status in Australia that some other faculties have and, secondly, it is a costly faculty in which to be a student. A five year dental course costs just as much as a six year medical course. These are two of the reasons why young students are not coming forward to enter the Faculty of Dentistry. Another reason is that only restricted facilities are available in the universities. At least two universities impose quotas in respect of the number of entrants into the Faculty of Dentistry. Recommendations were made by the Australian Dental Association to the Australian Universities Commission that Faculties of Dentistry be established at the Monash University and at the University of New South Wales. Apparently, those recommendations have been ignored. No faculties have been established.

So the Opposition is critical of the fact that the Commonwealth Government has not accepted the recommendations in respect of dental schools. The Opposition is very unhappy also because of the failure of the Government to make greater provision for teaching hospitals. We on this side think it is time the Commonwealth took a look at postgraduate and research facilities connected with teaching hospitals as well as undergraduate facilities.

Mr BRYANT:
Wills

.- Mr. Deputy Speaker, I thought that during the afternoon we would have the advantage of hearing the views of some members on the Government side in relation to this Bill. I am the third speaker from the Opposition side. One thought that, with the resources at their disposal and their continual claims to be the protagonists of higher education, at least some Government supporters would do the homework necessary to enable them to participate in this debate. I believe that, in doing so, Government members would have been paying a proper tribute to the people who have produced the Second Report of the Committee on Teaching Costs of Medical Hospitals to the Australian Universities Commission and to the significance of higher education at this level in the community. They would also have been carrying out their task as parliamentarians.

One of the things that interest me when we are examining the attitude of the Government to a matter such as the one before us now is this: Who makes the decision? A significantly increasing amount of legislation associated with Commonwealth educational activities is coming before this Parliament. We have before us a report produced by a highly skilled team. True, it comes before us a little late, as has been pointed out by my colleagues, the honorable members for Fremantle (Mr. Beazley) and Barton (Mr. Reynolds). In common with other reports that have been prepared in similar circumstances, some areas of this report have been rejected. I would be interested to find out who made the decision in this regard. It is the belief of honorable members on this side of the House that a Commonwealth Ministry of Education ought to be established. We do not believe that the increasing interest of the Commonwealth in education can be dealt with part time by a Minister who is also the Minister for Works. It certainly cannot be a province in which the Prime Minister (Sir Robert Menzies) can take an acute interest. The Prime Minister of a country such as Australia has enough to do on his own account. Taking a long look at history, I suppose I can say that the less he does in any field the better it is and the less damage he causes. But the point at issue now is that, in the increasingly important role taken of the Commonwealth in the educational sphere, we need a Minister who is answerable directly in this Parliament for education and who has that responsibility as a single function.

We find that in this case recommendations regarding dental hospitals in this report, which was produced by a very important committee set up by the Australian Universities Commission, have been rejected. A significant area of the report associated with honorary teaching in hospitals has been rejected also. This is indicative of the inactivity that the Government exhibited earlier in the year in relation to the report of the Martin Committee. A large portion of that report was associated with teaching. It was rejected. There is also the report of the Vernon Committee, of unhappy memory, which, in the terms of the classics, hardly hit the deck. The thing that concerns mc is the way in which such reports float across the governmental horizon. We have to speak to the Government, not to a Minister. I think the Minister in Charge of Commonwealth Activities in Education and Research is doing the best he can, having regard to the limits within which he operates and they are very conservative. There is continuing flow of statements from him, but there is no doubt that the Commonwealth’s present attitude towards education is haphazard and rather perfunctory. I think it is high time that we gathered our ideas together and made a more scientific and planned approach to education.

The recommendations before us relate to teaching hospitals. The Committee, at paragraph 1.5 of its report, said -

The Prime Minister and the State Ministers agreed that medical instruction could not be terminated at the boundary walls of the actual university proper. They considered that the instruction of clinical students in teaching hospitals was a subject which fell within the university concept and not within the ambit of Commonwealth/State hospital relations. As such, it was a problem that would have to be dealt with by the Australian Universities Commission.

This gives the background of the situation. The Prime Minister accepts the overriding importance of the teaching function of hospitals in the medical faculties, and I include the dental faculties as part of the medical faculties if the dentists do not mind being grouped in that way. We are talking about teaching hospitals and about the facilities at teaching hospitals. The report of the Committee gives ample demonstration that the medical section needs greater support; but it gives not only ample demonstration but I think devastating demonstration that the dental section needs immediate assistance.

I would think that at present the teaching functions of the universities are their weakest point. I do not quite know what the answer is, but we can only be distressed at the very high wastage rate in the universities of Australia. The people of Australia - the parents and taxpayers - send students to the universities. I do npt think that “ cream “ is the correct term, but certainly the people who go to universities are in the top bracket of students. I presume that the average Australian is not much different from the average person to be found elsewhere in the world. At present the top 25 per cent, of students go to universities. If the university system catered only for the top 20 per cent., I believe that it would be unduly exclusive and would need very close scrutiny.

Let us look at the failure rate in the dental faculties. In 1946, 531 students entered the dental faculties at Australian universities, but only 342 of them graduated. In 1947, 619 students entered and of those 292 graduated. The wastage of students who entered in this year was more than 320. In 1948, 448 students entered the dental faculties and of those 224, or only 50 per cent., graduated. We are speaking of a particular group of people. They are people who, on the whole, passed through their secondary education with distinction. They are people who were in the top bracket of students. Year after year in the secondary schools they were in the top 15 or 20 students out of classes of 40 or 50. They were successful at the final matriculation examinations and they entered a university. But the wastage rate 15 years ago was 50 per cent, and in some, instances was more than 50 per cent. Let me come nearer to the present time. In 1957, 219 students entered the dental faculties of Australian universities and five years later 147 graduated. In 1958, 216 students entered first year and 109 graduated later. In 1959, 229 students were admitted and subsequently 136 graduated. In 1960, 267 were admitted and eventually 130 graduated. So the wastage rate is still 50 per cent.

I believe that in these figures we can find the challenge that is before us. I do not think the challenge should be taken up by this Parliament only. It lies before the whole education fraternity of Australia and the faculties in the universities. When this wastage rate extends over what I might call two or three generations of university students, it is time for the nation to take a close look at the system, and it is certainly time for the universities to do so. I know that the staffs of the universities will say: “ These students are untrained when they come to us.” That is what they said after the war when many students were attending universities under the Commonwealth Reconstruction Training Scheme. It was said then that these students were not properly trained. If we could look at the whole series of remarks that have been made about the wastage of students at universities, we would find that this was almost the continuing theme. We would find in all of them such comments as: “ Teaching in the secondary schools is not good. Students come to us unprepared, so there is a vast wastage.” The wastage of students at universities is a significant social factor, a devastating personal factor and an expensive economic factor. We have before us a recommendation that the Commonwealth accept greater responsibility for the students in the dental faculties of Australia, but the Commonwealth has rejected the recommendation. I believe that this is a serious departure by the Government from its duty. It is an abdication of its duty. It is a fact that the Commonwealth is becoming increasingly committed to universities and other forms of education. This is not merely a matter of statistics. It is not merely a matter of the Government looking at a series of recommendations and slicing off the one-third or two-thirds that fit into Treasury requirements. This is a challenge that we must face.

I think it is true to say that the failure rate is much the same through all the faculties. It changes from time to time and at different points of reference. There is a considerable culling out of students at the matriculation examinations. Of the students who presented themselves at the matriculation examinations that started in Victoria yesterday, 30 per cent, will be failed. Some skilful character managed to get hold of the English paper for the Victorian examination and was selling copies for £5. He was caught, and that is most appropriate. But this is what goes on, and we should be able to see the significance of it. Matriculation is a major hurdle in a student’s educational career. I believe that the Minister in Charge of Commonwealth Activities in Education and Research, who is in another place, is in serious error when he says that matriculation is not necessarily the key to admission to a university. I believe that by definition that is exactly what matriculation is.

The teaching function is now before the Parliament. The only real consideration in this Bill is the teaching function in medicine and dentistry. I believe that the figures show that the dental faculties need special support, but the Government has rejected a recommendation that this support be given. To that extent, the Government deserves the censure of this House and I hope that some of the honorable members on the opposite side who are listening so intently - the six or seven of them who are here - will support the views pf the Opposition. Two major recommendations have been made. The honorable member for Barton and the honorable member for Fremantle mentioned honorary teaching in the medical faculties. This system, of course, is an imposition on the people who have high skills and high professional ethics and who devote their time to it. The report points out that this system is an anachronism and economically an unfair imposition on those who are engaged in it. Of course, it is part of the old charitable attitude towards medicine. It was thought that some people could pay for their medical attention but a lot of people had to accept this attention as a charitable activity. I pay a tribute to those who have given their time to train others. It has been estimated that these people by their own personal efforts provide a subsidy of about £500,000 a year for training medical students. But it is time that we accepted the idea that universities cannot be run in this way. We should accept the view that professional people cannot be trained on a part time, unpaid, voluntary or honorary basis, despite the devotion, dedication and skill of those who provide the training. We must accept the challenge that has been offered to us and we should urge the Government to look carefully at the present system.

Let us consider the proposition that is placed before us. At page 54 of the report of the Committee, the following passage appears - 4.39 If Australia is to attain a ratio of 1:2,000 by 1975, it bas been estimated that some 350-400 new dentists will be required each year.

At present the ratio is one dentist to 2,300 people. As was pointed out by the honorable member for Fremantle, the ratio is lower today than it was a few years ago. This report pointed out that we need 350 to 400 new dentists each year. Last year only 362 entered the dental faculties. The previous year the number was 264 and in 1961 it was only 251. In fact, that was 100 short of the number required even if all passed. If we are to have a planned medical service we shall have to improve on this state of affairs. By using the word “plan ned” in this context 1 am not necessarily asking honorable members opposite to agree with us on this side of the House about the need for a national medical service and about freedom of choice and the like. There are plenty of explanations in the records that show what we mean when we use the expression “ planned medical service “. I think it is reasonable for society to set standards in fields such as this. After all, we have bodies that set standards in all sorts of fields for all sorts of commodities and services. We have what might be described as logical aims in other fields, and according to this report it is a logical aim to try for a ratio of one dentist per 2,000 of the population. If we work back from that requirement, we come to the requirements of the dental faculties of the universities of Australia. Here we have another demonstration of the hit or miss methods that this Government adopts in relation to so many of Australia’s social problems.

I believe that there are some principles that we should apply to the consideration of measures such as this. As I pointed out, we should have a planned medical service. This does not mean that it should be a regimented one. By this I mean that there should be a certain amount of social planning and direction of resources in such a way as to ensure an adequate flow of students through the universities, the establishment of clinics, necessary encouragement of research and encouragement in all the fields of activity that relate to the solution of this problem. Our dental research should be adequate. This means that there should probably be government support at all levels. As my colleagues have pointed out, a national medical service is needed. These services must be efficient. I do not think that anybody would deny that Australian dentists are highly efficient by world standards. I am one of those unfortunate people who have the kind of teeth that do not need the care of a dentist. But dentistry, as has been pointed out, is a profession that so far does not carry the high social status that some other professions have. However, there is no doubt that toothache is one of the dire miseries from which the human frame suffers. It is also the ailment in respect of which the sufferer perhaps receives least sympathy from other people.

I believe that we should be looking towards a progressive dental service and profession. The Australian Dental Association has put before us the suggestion that the picture is not as bad as it is painted in the second report of the Committee on Teaching Costs of Medical Hospitals. This may well be so, but it is obvious that in the medical and dental fields and also in the physical sciences, as well as in many other fields, not as much research as is required is being done in Australia. Here, I believe, we come to the Commonwealth’s function. We shall have to face the need to provide increasing support for the universities and all that goes with it. It is interesting to note that despite the fact that the Government seems to be rather dilatory and approaches the matter in a rather perfunctory fashion its support for the universities is continually increasing. Commonwealth grants are just one part of the income of the universities, and I confine my remarks to that one part. In 1961 the universities, out of a total income of £42 million, received £11 million from the Commonwealth, or some 24.8 per cent. In 1962, out of £48 million, the Commonwealth provided £13 million or 27 per cent. In 1963, out of £53 million, it provided £15 million or about 28 per cent. There is an increasing Commonwealth commitment. This is inevitable and we must face the need for it. It is time we tackled the whole problem in a progressive and scientific way.

Part of the Opposition’s criticism this afternoon is based on the diffident and almost anomalous steps that the Government takes at times. We are forced to ask: Why did it do A and not B? Why did it accept the recommendations of the Committee on the Future of Tertiary Education in Australia - the Martin Committee - with respect to Institutes of Colleges and not those with respect to Boards of Teacher Education? Why did the Government accept the recommendations of the Committee in certain areas and not in others?

There is one last field into which the Commonwealth, I believe, could step. This is mentioned at page 49 of the second report of the Committee on Teaching Costs of Medical Hospitals. Probably only the Commonwealth can do what is required. The

Committee, in paragraph 4.3 at this page of its report, stated -

Graduates in Australia must register with the appropriate Dental Board to obtain the right to practise. In the United States it is necessary to take State Board examinations in order to practise in a different state from that in which the original qualification was obtained. A high degree of reciprocity exists only within the British Commonwealth.

Here we find one of those unconsidered trifles of the relationships within the Commonwealth of Nations. I believe it is time that these relationships were expanded over wider fields. There is in the Australian scheme of things a happy conceit that leads people to believe that only if one has been trained in Australian or Commonwealth universities is one adequately trained. What is the position of a dentist who arrives here from Vienna, Berlin or Copenhagen? I understand that he is probably in the same position as the person who comes here with a medical degree from one of the same distinguished universities. I hope that the Commonwealth will step into this field and take some action to expand international reciprocity in these professions. I hope that honorable members opposite will earnestly consider the proposition that we on this side put before the House. We believe that the House ought to express its opinion that this Government has been remiss in not adopting the recommendations of the Committee on Teaching Costs of Medical Hospitals concerning dental education in particular. Honorable members opposite ought to consider very deeply other implications of that Committee’s report. The Commonwealth cannot avoid its obligations to help the universities of Australia to discharge their teaching functions. I hope that on this occasion Government supporters will join honorable members on this side of the chamber in expressing censure of the Government in this way.

Mr L R JOHNSON:
Hughes

.- Mr. Deputy Speaker, I understand that I am the fourth successive Labour member to speak in this debate. I am rather surprised that members of the Liberal Party and the Australian Country Party who sit on the Government benches are not prepared to get their teeth into this important subject. But it should not be thought that this discussion is confined to the need for better dental facilities and assistance for dentistry in Australia. This is a broad, comprehensive and complex piece of legislation relating to financial assistance for universities. It is the third measure of this kind during the 1964-66 triennium. As honorable members will be aware, this measure will authorise Commonwealth grants to meet the teaching costs of medical hospitals. In the 1961-63 triennium Commonwealth assistance was confined to grants for capital works. On this occasion there is a significant departure from the former practice, for recurrent costs as well as capital costs are now to be met to some extent by Commonwealth grants. The grants to meet capital costs under the terms of this measure will total £1,555,850 and grants to meet recurrent costs will amount to £184,900, making a total of £1,740,750. This may seem a considerable sum, but it is important to make the point that not all the requirements recommended by the Committee on Teaching Costs of Medical Hospitals - an expert committee that was appointed to examine the problem - have been conceded by the Government.

I agree with my colleague, the honorable member for Barton (Mr. Reynolds), who criticised the belated appearance of this report. If we examine its history we shall see that it was presented to the Minister in Charge of Commonwealth Activities in Education and Research (Senator Gorton) on 7th May 1965. The Government’s decisions were announced on 5th August and the report was presented in both Houses of the Parliament on 24th August. I suppose that it is fair to say that once the report reached the Government it was dealt with fairly expeditiously. But it is certainly not a good thing for this kind of report not to arrive until the middle of the 1964-66 triennium. This fact indicates that the Government tends to treat the Parliament merely as a rubber stamp.

Mr Freeth:

– That is nonsense.

Mr. L. R. JOHNSON__ Why is it nonsense?

Mr Freeth:

– The report came to the Government through the Australian Universities Commission. The honorable member ought to blame that body if he blames anybody.

Mr L R JOHNSON:

– I believe that the Government should indicate the timetable requirements for reports such as this. When we are dealing with a particular triennium it is desirable to get the relevant reports close to the beginning of the triennium rather than near the middle of the period. As the honorable member for Barton has said, it is more desirable to get the reports beforehand. I do not expect the Minister to retort “ Nonsense “ to that very reasonable suggestion. The Commonwealth is supporting the capital projects recommended by the Committee to the extent of £1 for £1 and the recurrent costs to the extent of £1 for £1.85. If the Minister proposes to extend to us the courtesy of replying to the various comments made, perhaps he will give some explanation of the disparity that 1 have mentioned.

I just cannot understand why the recommendations in respect of recurrent costs have been conceded but are limited to £1 to £1.85. I think it is also regrettable that the extent to which the Commonwealth is prepared to face up to this very apparent need is geared to the financial paying capacity of the States. Unquestionably the States are in dire financial circumstances. Some States are even talking about slashing expenditure on high schools, for example. The programmes of development recommended by specialised committees appointed by the various States have not been fulfilled. Yet the Commonwealth is prepared to contribute to these things only to the extent that the States are prepared to play their part. This, in my view, is an old fashioned sort of concept. If the Government really has regard to the health of the nation and the glaring anomalies to which attention has been drawn by this and other expert committees, it will make sure that this matter and the other matters receive the priority that they deserve.

It is a matter for concern also that this legislation is limited to the clinical teaching of undergraduate medical students. We know what sort of concept is involved. The view is taken, justifiably enough, that as this concerns the extension of university teaching to teaching hospitals, it is necessary to supplement the uniform taxation reimbursements to the States to enable them to facilitate the training of medical students in hospitals as distinct from training them in universities, although that training goes on, of course. Although this concept is commendable, in mv view it stands in splendid isolation. It applies to doctor training only.

In passing I should like to make the point that there is a good case to be made out for the extension of this principle, certainly to dentists, as has been indicated by my colleagues, but also to the training of other professional people. For example, if 1 may say so in passing, I think this could apply to teacher training. Teacher training extends past the teachers’ college into the schools and when we look at the matters which are referred to in the second reading speech delivered by the Prime Minister (Sir Robert Menzies) we see that these matters which are the subject of Commonwealth assistance for the training of medical students represent a common denominator in respect to the training of medical students on one hand and the training of teacher students on the other. I refer, for example, to the provisions of proposed section 8b in clause 4 of the Bill which state that assistance is being given in respect of the salaries of administrative officers, clinical supervisors and secretarial personnel. These classes of personnel are employed also in respect of teacher training and recurrent costs of a non-capital nature operate in regard to teacher students as they do in respect of medical students. This applies also to library costs. In many places where teachers are trained, library facilities are tremendously expensive and represent a burden on the States.

Postgraduate teaching is disregarded in this legislation. I wonder why the Committee did not make a recommendation in regard to postgraduate training and why the Government did not see the need for assistance in this field. I should like to refer to this subject a little later. While I am dealing with exclusions from the recommendations, I think an explanation should be given by the Government of its refusal to assist the financing of honorary personnel. The Opposition has not chosen to develop its own attitude about this by any means. Nevertheless, the Government must have formally determined its views, as this recommendation was set out in such a clear and forthright fashion. The recommendation is along the lines that there should be a contribution to the extent of £6 per hour towards the cost of honoraries working in hospitals. This adds up to a considerable amount of money as I shall show.

The University of Sydney has 9 hospitals to service, the University of New South

Wales has 3, the University of Melbourne has 4, Monash University has 2, the University of Queensland has 3, the University of Adelaide has 4, and the University of Western Australia has 5. Medical teaching costs at the rate of £6 an hour paid to the honoraries involved would amount to £529,728 per annum. To be added to this sum, of course, would be the estimated cost of £138,170 for hospital staff engaged in teaching activities. The total cost would be £667,898 per annum. I mention this matter because the Committee has been so adamant that something along these lines should be done. The Committee has made out a strong case, but the Government has rejected it. I believe that the honorary people who are engaged in teaching and who give up their time to do so are entitled to an explanation of the Government’s attitude.

I mentioned just a moment ago that postgraduate training has been disregarded in this legislation. I should like to say a few words about this, particularly as the need for postgraduate training and extension specialist training has received such a great deal of emphasis in the report of one of the most eminent medical committees that has been appointed for some considerable time. I refer to the report of the Hospital Services Committee which was appointed to consider matters relating to public hospitals in New South Wales. This is known as the Starr Committee. As is generally known, the Starr Committee recommended a fairly dramatic development in hospital organisation in New South Wales. It contended that there was a need for the regionalisation of hospitals. Early in its report it said -

The shortage of skilled and experienced medical specialists, general practitioners and medical record librarians is one of the chief reasons for the gradual implementation of the recommendation.

The report goes on to state that there is a shortage of specialists, in New South Wales particularly, and that there is no question that similar evidence could be brought to bear to show that there is a need for more specialists in other parts of Australia. The Starr Committee said -

There is a scarcity of specialists throughout New South Wales, except in Newcastle and Wollongong, in - Anaesthesia, Paediatrics, Orthopaedics, Urology, Dermatology, Ear, nose and throat work, Neuro-surgery, Facio-maxillary work, Psychiatry.

I am not quite sure what is meant by all those terms. It underlines in a very dramatic way the need for specialist training. Having regard to the comparatively large number of medical graduates that we have in Australia, I believe that, instead of sending them overseas to receive the specialist training they need, we should be setting out to assist their postgraduate training in this country.

I might also mention that the Starr Committee drew attention to the fact that teaching hospitals require very expensive and complicated equipment, special structural provisions and trained ancillary staff, often of university standard. Some of the things to which the Starr Committee referred are not mentioned in the legislationbefore the House; nor have they been mentioned in the report of the Committee on Teaching Costs of Medical Hospitals in the same detail as in the Starr Committee’s report. For example, referring to teaching hospitals - probably the Minister will be able to say whether these services will receive assistance - the Starr Committee says -

That gives some indication of the extent of the specialities involved in teaching hospitals. The hospitals require expensive equipment and ancillary staff, which obviously should be the subject of Commonwealth assistance to some considerable extent. Just as the Commonwealth is prepared to assist in the training of medical students, so should it contribute towards the cost of these other factors. The Starr Committee goes on to indicate that there is a great deficiency in the services in many of the teaching hospitals in New South Wales. Doubtless a similar position exists in other States. The Starr Committee points out that the Royal Newcastle Hospital has no special facilities for dealing with plastic cases; that the St. George Hospital has no facilities for dealing with neuro-surgery; that the

Sydney Hospital and the St. George Hospital have no thoracic facilities; that cardiac surgery facilities are denied to the St. George Hospital and the Royal Newcastle Hospital; and that radiotherapy facilities are denied to the St. George Hospital, the Prince Henry Hospital, the Prince of Wales Hospital, the Royal Newcastle Hospital and to the Royal Alexandria Hospital for Children. It also points out that nuclear medicine facilities are not available in the St. George Hospital, the Royal Newcastle Hospital or the Royal Alexandria Hospital for Children. Artificial kidney facilities are not available at the Royal Prince Alfred Hospital, St. Vincents Hospital, St. George Hospital, the Royal North Shore Hospital and the Royal Newcastle Hospital or at the Royal Alexandria Hospital for Children. Facilities for paraplegics are not available at the Royal Prince Alfred Hospital, the Sydney Hospital, St. Vincents Hospital, the St. George Hospital or at the Royal Alexandria Hospital for Children.

It is apparent, therefore, that we lack facilities which are desperately needed. As I have mentioned already, the teaching hospitals require assistance not only to meet the cost of training medical students but also to provide the ancillary staff and all the equipment necessary to facilitate their operations. I think that, in all, 10 items were recommended by the Committee on Teaching Costs of Medical Hospitals, but it is difficult to be sure which of those items have been incorporated in the legislation now before us. Clause 5 of the Bill refers to the matters which are to receive Commonwealth assistance. They are referred to in a general sort of statement. The Bill does not clearly designate in any detailed manner the services which are to receive Commonwealth aid.

It would seem to me that among the items recommended by the Committee which have not been included here are, firstly, the expenses incurred in bringing patients to hospitals for teaching purposes. I can see no mention of that in the second reading speech delivered by the Prime Minister; nor can I find it mentioned in the Bill before us. I see no reference to meals provided for students while in residence in hospitals for specified training. I may be wrong, but I am unable to satisfy myself about that.

Mr Freeth:

– That was not recommended by the Committee.

Mr L R JOHNSON:

– The Minister is prepared to be dogmatic, but I must confess that it is not clear to me. Another item relates to the time for which nurses are required to be in attendance during the clinical instruction of students in the wards and outpatient departments. That does not appear to be covered.

Mr Freeth:

– I suggest that the honorable member read the next paragraph of the report. He is reading from paragraph 2 of Chapter 2. If he will read the next paragraph he will see that these items were only partly accepted by the Committee.

Mr L R JOHNSON:

– I will welcome the Minister’s explanation. I am mentioning these matters because the position with relation to them is not clear to me. The wording of the Bill is ambiguous and some explanation is needed. Another item relates to the attendants and cleaners required to service the areas used by clinical teaching units and medical students. It would seem that this recommendation has not been accepted. The same appears to be the position with relation to the recommendation relating to the light, power and telephone costs chargeable to student teaching, and to the additional charges which could be attributed to teaching in the hospital departments concerned with pathology, bacteriology, biochemistry, anaesthetics, radiology, clinical photography, medical records and operating theatres. I raise these matters in the hope that the Minister will indicate why they have been excluded, if in fact they have been. The position is not clearly stated in the Bill.

The honorable member for Fremantle (Mr. Beazley) has moved an amendment. As it is some hours now since he did so. I suggest that it is appropriate that I remind honorable members of it. It seeks the inclusion of these words -

Whilst not opposing the passage of the Bill the House is of opinion that the Government should adopt the recommendations concerning university dental schools by the Committee on Teaching Costs of Medical Hospitals.

Before resuming my seat, I want to support that amendment. A short time ago there appeared in the Press a report of a statement by Dr. Ezra Pound, a visiting dentist from the United States of America and apparently a professional person of world renown. Under the heading “ Our teeth the world’s worst “, the following appeared -

At least 75 per cent, of Australians had no intention of properly maintaining their natural teeth, Dr. Ezra Pound, visiting U.S. dentist, said in Sydney today.

Australians have the worst teeth in the world, he said. They feel that the sooner they get false teeth the better.

He then went on with a general indictment of the inadequacy of our dental facilities, deficiencies with relation to personnel and so on.

At the beginning of the report from which this legislation stems, there is a letter to the Minister, signed by Sir Leslie Martin and six other members of the Australian Universities Commission. The letter referred to the need for assistance to dental schools. It sought to justify the action of the Committee in breaking new ground by considering the need for assistance to dental schools. The letter reads, in part -

Chapter 4 of the Committee’s report deals with dental schools and dental hospitals. Recommendations for assistance to dental schools lie properly within the terms of reference of the Commission itself. During our triennial visits in 1962 for the 1964-66 triennium we were impressed with the urgent need for adequate teaching facilities in dental schools, but we considered that the Commission itself lacked the necessary technical background to make an authoritative judgment. We decided, therefore, to ask our Committee on Teaching Costs of Medicine Hospitals to examine this problem and make recommendations to us.

Later the letter states -

We would point out, however, as emphasised by our Committee, that assistance for the dental schools, particularly of the Universities of Queensland and Adelaide, is urgent.

As I said, the letter, signed by the Committee’s members, was justifying this move into a new area of consideration. The Committee recommended an expenditure of £897,000 in respect of capital grants, not in relation to recurring costs. In other words the Committee treated the Government very benevolently. It could have easily indicated a need for greater expenditure on recurring costs. If we go through the report and its references to the visits the Committee made to the various dental hospitals we can quickly see the extent of the dilemma that prevails in the dental field. In Western Australia the demand is such that student accommodation should be doubled. The Committee has reported that at present there are 117 students and that this number should be doubled. It suggests that extra accommodation be made available to facilitate this increase in numbers. There is a quota of 25 students in the second year of dentistry at that university. At the University of Adelaide there is a need to replace dental teaching facilities as well as a need for clinical facilities for 50 instead of 25. The Committee recommended a new dental school at the University of Queensland to be sited more conveniently alongside the existing dental hospital. This would involve considerable expenditure. I am skating over these aspects of the report to indicate that a problem exists in every State. In Melbourne there has been a quota of 45 first year students since 1964. In Sydney there is a quota of 120 first year students, and in respect of the University of Sydney the Committee has referred to overcrowding, the inadequacy of accommodation and the need for considerable expenditure on lighting, equipment and chairs. This is the state of dental schools in Australia at present.

In the face of the Committee’s comments, and in the face of its recommendation that £897,000 be spent, the Government has chosen to ignore completely the need for assistance to dental training. As has been pointed out, the number of dentists in relation to the population is poor by world standards and the position is deteriorating. In 1963 in Australia there was one dentist to every 2,531 people, but in 1965 there is one dentist to every 2,585 people. In the Committee’s report are figures relating to the dentist-population ratio in other countries. This table indicates that by world standards Australia is not in a satisfactory position. The years are not comparable, but they indicate the position. In Sweden, in 1956 the ratio was one to 1,600; in Norway in 1956 it was one to 1,600; in the United States of America in 1960 it was one to 1,700; in Denmark in 1956 it was one to 1,800; and in Australia in 1956 it was one to 2,300. We had one of the worst ratios, and of the countries mentioned only the United Kingdom had worse figures. In the face of this unsatisfactory position our dentists are going overseas. About 565 dentists registered in Australia are at present overseas. Over the last 10 years the average dental student intake has been 276 a year, but the number of graduates has been 127, so there has been a serious wastage. We want to know the reason for this, because the people are entitled to dental protection.

The Government does not treat dentistry seriously. I understand that at present there is no senior dentist in the Commonwealth Department of Health. It is true that we have the Commonwealth Bureau of Dental Standards but it is concerned principally with the examination of materials used in dentistry rather than with many of the other important facets involved. I join with my colleagues in expressing concern at the complete denial of the recommendations made about the need to assist the training of dentists in Australia. The Australian Labour Party does not disregard this problem but treats it as of the utmost importance. My Party’s policy would not be out of keeping with the attitude of the Committee from whose report this legislation is derived. The Labour Party stands for the formation of a division of dental health within the Commonwealth Department of Health; for the provision of dental services to be conducted by salaried dental staff willing to join and available to persons without charge and without means test who choose to use such services; and for the establishment of a postgraduate school of dentistry at the Australian National University. I am sure that these aspects of the policy of the Labour Party are in keeping with the recommendations made by the expert, committee. I sincerely hope that in view of the emphasis that has been placed on dental training - probably more than I have heard in the last 10 years - the Government might be encouraged to treat dentistry with tha importance it deserves.

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

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

Mr. TURNBULL (Mallee) [5.22J. - I shall not delay the House for very long, but we have just listened to four speakers from the Opposition three of whom criticised Government supporters for not speaking on this legislation. The honorable member for Fremantle (Mr. Beazley) did not criticise. When the honorable member for Barton (Mr. Reynolds) expressed this criticism I interjected and said: “ On what authority are you speaking?” and he said: “Are you going to speak?” and I said: “ Yes “. The Opposition surely should be quite happy, because, after all, the Government introduced this legislation and Government supporters favour it and will vote for it. Strangely, the Opposition will vote for it too. As we are trying to get through the business of the House long before Christmas, when both sides of the House support a measure it should not be debated all day.

I should like now to examine the amendment moved by the honorable member for Fremantle. He has suggested the omission of all words after “ That “ and the insertion of the following words: “ whilst not opposing the passage of the Bill”, and so on. This substantiates what I have said. The Opposition is not opposing the passage of the Bill but it is taking the opportunity to include aspects that are mentioned in the amendment. The amendment continues - the House is of opinion that the Government should adopt the recommendations concerning university dental schools by the Committee on Teaching Costs of Medical Hospitals.

It is noteworthy that such an amendment should be moved. It will add considerable costs to the Budget, yet not one member of the Opposition has suggested where this extra money should be collected. It seems that they think money comes to the Government by magic. The Government is progressive and it builds up funds which it uses in the best way possible for the country. The Australian Labour Party is never satisfied. If the Government provides a subsidy of £2 for £1 for homes for the aged the Opposition wants £3 for £1, or if £3 for £1 it wants £4 for £1. Members opposite never suggest where the Government should get the money. If the Government collected the money by way of direct taxation the Opposition would say that the working man was being affected by the taxation. If it collected the money by means of indirect taxation the Opposition would say that this was wrong. So I do not take very seriously the submissions made today by Opposition speakers, because none of them has told us how this extra money should be raised. Many other things have been said in the debate. The honorable member for Fremantle said that today people have a life expectancy of 70 years compared with 54 years some time ago.

Mr Beazley:

– I said that in 1901 people had a life expectancy of 52 years.

Mr TURNBULL:

– This has increased to 70 years now. That is very good. The honorable member said that because of this increase in life expectancy we do not need so many doctors.

Mr Beazley:

– I did not say that. I said exactly the opposite. I said that the more you prolong life the more you have need of doctors.

Mr TURNBULL:

– All right. The more you prolong life the more you have need of doctors. Our life expectancy has been increased because we have had good research services and because we have virtually wiped out such diseases as diphtheria and tuberculosis, which used to kill thousands. This Government’s activities in the field of medical research and in enabling young men to qualify as doctors have contributed towards our increased life expectancy. I agree with the honorable member in this respect.

On a few occasions I have pointed out in the House that it is sometimes difficult for people in country areas to obtain the services of a doctor. The increased amount of money being made available for teaching hospitals is greatly appreciated as it will enable more doctors to be trained. At present a young doctor may set up practice in- a country area, but he does not get many opportunities to further his studies there. As a consequence he moves to a city. Having become more expert in his profession, he does not return to the country. We are trying hard to bring more doctors to Australia from overseas, but everybody will be more satisfied if we can train our own doctors in this country. We have a better chance of doing this now that the Government is providing more money for this purpose. In his second reading speech the Prime Minister (Sir Robert Menzies) explained the Bill. The four Opposition speakers who have taken part in the debate did no more than explain the provisions of the Bill again. The Opposition has been moved to take part in this debate only because it considers that the recommendation of the Committee on Teaching Costs of Medical Hospitals regarding dentists should have been implemented at the same time as other recommendations. The Opposition has not been able to find fault with the Bill itself. I listened carefully to Opposition speakers. All they said was that the Bill should give effect to other recommendations of the Committee.

Mr Pollard:

– That is fair enough.

Mr TURNBULL:

– Of course it is. This is a progressive Government. It does not intend to implement all of the recommendations at this stage. Have the other recommendations been rejected? Probably they have only been postponed. The honorable member for Wills (Mr. Bryant), who is smiling, said that the Government should adopt a progressive -and scientific method of dealing with these matters. I would like him to give me an example of the progressive and scientific method which the Government should have adopted. His was a statement without weight. Regarding recurrent costs, I think the honorable member for Wills said that they should have been provided for retrospectively, but the honorable member for Hughes (Mr. L. R. Johnson was delighted that they were provided for in the Bill. So it would seem that members of the Opposition cannot agree among themselves. No wonder they got far afield on many subjects.

I know that the honorable member for Fremantle never appreciates anything I say. Sometimes I disagree with Government proposals, but I think that my primary duty is to keep the Socialists out of government. So in supporting a minor Government proposal rather than an Opposition proposal with which I might agree, I am accepting the lesser of two evils. The” honorable member for Fremantle finds fault with my actions. But when his party was in government he did the same thing on many occasions. On dozens of occasions I have heard him say the same things as I have said.

Mr Beazley:

– I did not find fault with the honorable member.

Mr TURNBULL:

– Well, you appeared to.

Mr SPEAKER:

– Order! The honorable member will be more in order if he addresses the Chair.

Mr TURNBULL:

– If the honorable member for Fremantle did not find fault with me I am pleased to know that he supports my contention regarding legislation. This is that although you may agree with proposals put forward by the Opposition you cannot support them because they are contrary to Government policy and the main objective of a member who supports the Government in a majority of cases is to keep that Government in office.

Mr FREETH:
Minister for Shipping and Transport · Forrest · LP

– In rejecting the amendment proposed by the honorable member for Fremantle (Mr. Beazley) I would like to comment that it is not entirely unknown for an opposition to want to go far further than a government will go when it is proposing expenditure from public funds on worthwhile projects. We have listened today to several members of the Opposition who spoke about a wide range in increased expenditures that they would like to see incorporated in this legislation. One or two Opposition speakers suggested that we should include the cost of postgraduate training in hospitals. The honorable member for Hughes (Mr. L. R. Johnson) referred to a long list of the shortcomings of medical care in hospitals, which I gather he obtained from the report of the Starr Committee. His remarks in this connection had nothing whatever to do with the legislation. With this happy sense of irresponsibility the Opposition is able to see things out of proportion, but the Government must face up to the facts.

I remind the House that during this Government’s term of office and in comparatively recent years a tremendous amount of progress has been made in the amount of aid that the Government has provided for universities. In the beginning there was no assistance. Then we gave assistance in capital funds for universities and for recurrent costs. Then we went beyond the university walls to teaching hospitals. In this second triennium assistance has again been extended to recurrent costs for teaching hospitals, expenditure in the first triennium being confined to capital costs.

The Opposition has complained because the Government has not accepted a recommendation of the special committee of the

Australian Universities Commission which would include dental hospitals within the ambit of this legislation. In his second reading speech the Prime Minister (Sir Robert Menzies) explained why dental hospitals were not included. First, this legislation is brought down, through no fault of the Government I remind the House, half way through the second triennium. The recommendation as to dental hospitals deals with capital costs of dental schools within the universities. This comes at a time when the universities are already committed to a capital programme over a three-year period, a capital programme which has already been enlarged by the recommendations of the Martin report and the works undertaken for medical teaching hospitals.

The Commonwealth is not alone in this; it is acting in co-operation with the State Governments. The universities, the State Governments and the Commonwealth are fully committed physically and financially for the remainder of this triennium in regard to capital works within the universities. Of course, there is a very good reason in addition why this recommendation should not be accepted at this time by the Government. It was not, as the Universities Commission commented, within the terms of reference of this Committee.

The honorable member for Hughes, I thought with rather more brevity than honesty, read a section of the letter from the Universities Commission to the Minister, and he carefully omitted a section of it. I shall now rectify, in part, the honorable member’s omission. The letter said -

It is true that we have no specific mandate from the Commonwealth Government for our Committee on Teaching Costs of Medical Hospitals to undertake this task and it could be argued, therefore, that the recommendations made in Chapter 4 should really be considered for implementation in the 1967-69 triennium.

That, Sir, is exactly what the Government has undertaken to do. There is already a large commitment in the current triennium for a capital construction programme, and the Government has undertaken to have this matter considered, should the Universities Commission so recommend, when propositions for assistance to universities during the 1967-69 triennium are presented to the Government. I think we can dispose of the proposition of honorable members opposite when we see the whole matter in proper perspective and when we appreciate the Government’s reasons for the rejection of propositions for assistance for dental schools.

There were one or two other points raised during the debate to which I would like to reply very briefly. Although honorable members made these points, they did not treat them as matters on which to base opposition to the legislation. In the first place, the honorable member for Barton (Mr. Reynolds) complained that there was no retrospectivity in the grants recommended in this report. As to capital grants, these apply, of course, to expenditure on projects approved by the Commonwealth and State Governments. No question of retrospectivity arises in respect of these grants. As to retrospectivity in regard to recurrent expenditures, how would this have helped the teaching hospitals? They have made their expenditures, and they have been recouped in part or to the extent that finance has been provided by the State Governments. It would have been of no assistance, therefore, to the teaching hospitals for the Commonwealth to make retrospective payments. These recurrent costs have been provided for according to the normal pattern by the State Governments.

Mr Reynolds:

– But the Commonwealth is not providing its share.

Mr FREETH:

– The answer to that is that we are dealing with an intrusion into a new field. We are helping the State Governments for the future so that they can expand their activities. What we are doing does not apply to what has already passed. I should have thought that would have been obvious to the honorable member if he had stopped to think.

The honorable member for Barton then said that of six headings of expenditure recommended by the Committee the Commonwealth had accepted only three. In this he was quite wrong. If he looks at chapter 2, paragraph 12, of the report he will see set out six items which the Committee said it believed were recurrent costs incurred in providing clinical teaching, and that payments to meet these costs should be a university responsibility. But although it set out six items it made separate recommendations to the Government only as to four of them, lt made no separate recommendation as to the second heading, which was -

The recoupment of an appropriate portion of the salary of medical officers and other personnel employed by the hospital and engaged in university or supporting teaching activities, the university content of which can be determined.

It made no recommendation in regard to the sixth item, which was -

Indirect costs of hospital services attributable to teaching.

That covers quite” a number of headings. The only item which the Commonwealth Government did not accept after acceptance had been recommended by the Committee was that relating to the payment of honorary medical officers. The Commonwealth considered this very carefully but it had regard to the fact that a very important question of principle was involved in dealing with the traditional services of honoraries. The Commonwealth and the States act in partnership in this field and the States have a large problem in regard to hospitals generally. It was decided that it would be quite unfair if the Commonwealth, on a unilateral basis, as it were, decided to depart from the traditional treatment of honoraries generally and open wide the whole question of payment of honoraries for their services to hospitals. For that reason, the recommendation was rejected.

I think the honorable member for Hughes wanted the Commonwealth to assume a greater proportion of the burden of teaching in hospitals. He referred, if I understood him aright, to the rather odd provision for the Commonwealth to provide £1 for every amount of £1.85 provided by the States. There is a relatively simple explanation for this peculiar formula. The Commonwealth used to provide £1 for £3 of expenditure by the States. Then, in the previous triennium, the Commonwealth made an unmatched grant of a specific sum. In the result, it worked out that over the period the Commonwealth had provided £1 for every amount of £1.85 provided by the States. The Committee recommended that the proportion should not be changed in the current triennium because otherwise, after payment of fees had been taken into account at the universities, the actual amount left for State Governments to find out of their Treasuries would come down to less than the Commonwealth’s contribution. The Commonwealth would then be providing £1 for every amount of something less than £1 provided by the States. Having regard to the fact that the State Governments have the primary responsibility for universities, it is thought that this would not be desirable.

I have given a brief reply to a number of the points made by honorable members opposite. I urge the House to have in mind the enormous advances that have been made in providing facilities for training university students in many spheres. Step by step the Commonwealth Government and the Universities Commission, which has been taken to task to some extent by honorable members opposite for being late in this triennium with ils recommendations, have made a very careful analysis of needs, and I believe we can go on step by step making progress in this field. For that reason the Government cannot at this stage support’ the amendment proposed by the Opposition.

Question put -

That the words proposed to be omitted (Mr. Beazley’s amendment) stand part of the question.

The House divided. (Mr. Speaker - Hon. Sir John McLeay.)

AYES: 55

NOES: 42

Majority 13

AYES

NOES

Question so resolved in the affirmative.

Amendment negatived.

Original question resolved in the affimative

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. Freeth) read a third time.

Sitting suspended from 5.53 to 8 p.m.

page 3133

STATES GRANTS (ADVANCED EDUCATION) BILL 1965

Second Reading

Debate resumed from 19th November (vide page 2991), on motion by Sir Robert Menzies -

That the Bill be now read a second time.

Mr BEAZLEY:
Fremantle

.- Mr. Speaker, the States Grants (Advanced Education) Bill 1965 makes an important contribution to technical education. I ask the House to note that every educational institution mentioned as being assisted with the grant of £2,400,000 is an institute of technology. This is somewhat different from what the Prime Minister (Sir Robert Menzies) said a couple of months ago. He reminded us in his second reading speech on this Bill that, in tabling the first two volumes of the report of the Committee on the Future of Tertiary Education in Australia on 24th March last, he announced -

  1. . that the Government had accepted the Committee’s central recommendation for the development of advanced education in institutions which will become virtually new types of tertiary colleges outside the universities.

Now, I do not make this as a criticism of the Bill, but I do ask the House to note that these institutions are not new types of tertiary colleges outside the universities. The States have taken the opportunity to use the grants to finance institutions of technology which are not the same things as university colleges which were foreshadowed as the new form of tertiary education to be financed in the Bill. I do not blame the States for this action; nor do I blame the Commonwealth Government for making matching grants to the States. But I do say that these institutes of technology are not some new development in tertiary education in Australia. We have had the Royal Melbourne Institute of Technology for a long time.

The grant of £2,400,000 is significant. But, realistically, it is not yet the basis of the advances we need. With matching grants from the States, it means an expenditure of less than £5 million. Vital as this expenditure is, do not let us delude ourselves that by world standards it represents generosity. It is additional, of course, to other technical expenditure. But in the last decade technological education in every country has undergone a revolution. In the last decade, the world has become highly competitive technologically. Technological advance in West Germany far outstrips Australia’s advance in the same field. Japanese technological advance, with a concomitant advance in the whole Japanese economy, is far beyond the capabilities of Australia. The Scandinavian countries, Holland, Belgium and France are leaving our investment in technical and technological education far behind. So is the United Kingdom which, in comparison with some countries on the continent of Europe, has lagged. The Minister for Territories (Mr. Barnes) has reminded us in his statement on international aid for Papua and New Guinea that we have responsibility for technical advance in this

Territory. We need facilities here for training the best young people of the Territory. This measure, no doubt, will provide something to meet this need.

Not long ago, a United States business expert informed a society of employers in Melbourne that the lack of skilled workers inhibited foreign investment in Australia. Investment in skills is as critically necessary to ensure industrial and technological advance as is investment in plant and machinery. The Opposition believes that the sum that we are authorising, though important, reveals that the Commonwealth and the States still are not possessed of an adequate vision of the future of technical education in Australia. We still are not seeing the new type of tertiary education foreshadowed in the original statement made by the Prime Minister. I do not say that the Commonwealth can rush ahead and make a greater matching grant at the moment than the States are prepared to make. But I do say that we should not delude ourselves that a measure of £5 million to establish these institutes of technology is anything other than the beginnings of a technical advance.

The Bill is welcome. The Opposition would have moved an amendment to it to ensure the tabling of an annual report from the Wark Committee but for the fact that, as this Committee is not a statutory body and as this is a financial measure, such an amendment would not have been in order. A heavy investment in technical education of the most advanced kind is the difference between developed and underdeveloped countries. We need to strengthen technical education at levels below the institutes of technology that are set out here. The private sector of education is chronically weak in technical education. The State education systems are seriously weak also. The Commonwealth, in conjunction with the States and other technical authorities, must produce a sounder secondary technical system to buttress the development of advanced education in institutions and institutes of technology, which will become a complete system of tertiary education outside the universities. We regret that the Bill, which will provide part of an expenditure of less than £5 million all over Australia, cannot really meet the needs. It is to be hoped that the Wark Committee will lift the vision of both the Commonwealth Government and, particularly, the State Governments. For this reason, we feel that an annual report to this Parliament should be made in order to keep us abreast of needs, thinking, vision and achievements.

We wish the Bill a successful passage and ask the Government three things. The first is that the Bill shall be merely the harbinger of an extensive new programme of education to develop the finest technical skills in the young people of Australia. Secondly, we ask that the Parliament be furnished with reports from the Wark Committee. We ask, thirdly, that the Commonwealth, which foreshadowed the new form of tertiary education which was not, strictly speaking, institutes of technology, will use its influence with the States to see that the new form of tertiary education does come into existence. With those remarks, I support the Bill on behalf of the Opposition.

Mr LUCHETTI:
Macquarie

– Mr. Speaker, I support the remarks of the honorable member for Fremantle (Mr. Beazley). The States Grants (Advanced Education) Bill 1965 has for its purpose the implementation of the report of the Committee on the Future of Tertiary Education in Australia. This is known to honorable members as the Martin Committee report. This Bill authorises the Commonwealth Government to make grants of £2,400,000 for new colleges for advanced education in respect of the States of Australia. These grants are for the period 1st July 1965 to 31st December 1966. The increasing interest of the Commonwealth Government in education is appreciated by the Opposition as it is appreciated by the nation. I join with the honorable member for Fremantle in saying that more could be done and more should be done. Quite obviously this nation is bedevilled by the problem that the States will go their way with their education systems and priorities while the Commonwealth, in its wisdom and finding the finance for education, wishes to take another course. In this particular instance, the Commonwealth is fortified. Its needs are strengthened by the excellent report to which I have referred - the Martin report. Thoughtful people now agree that national leadership in education in Australia is needed and that basically there is need for a searching inquiry into all forms of education so that a more uniform approach may be developed to the question of education.

I should like here to offer congratulations to the eminent gentlemen who were members of the Martin Committee for the excellent report that they have furnished to the Parliament and the Government. The volumes are of inestimable value not only to members of the Parliament and to educators but generally to people who are deeply interested in the advancement of our nation. The report goes far beyond dealing merely with the question of how the Parliament should act in making available £2,400,000. This seems to me to be only the beginning of further Federal assistance in the development of the important field of education in Australia.

When the report of the Martin Committee was submitted to the Parliament and the Prime Minister (Sir Robert Menzies) delivered his speech on the report, we were all encouraged because we felt that this was the beginning of a new venture. It is true, as the honorable member for Fremantle said, that these are not universities in the full sense of the word. They are technological bodies based more on utilitarian values but dealing also with higher education. It is important that the findings of the Martin Committee should be known. In Chapter 1, which is headed “The Nation and Tertiary Education, Conclusions and Recommendations “, the Committee set out a number of principles which I believe are important. With the concurrence of honorable members, I incorporate in “ Hansard “ the conclusions and recommendations of the Committee.

The Nation and Tertiary Education.

Conclusions and Recommendations. 1. (i) During the post-war years in Australia there has been a rapid increase in the number of persons seeking higher education. The growth in population does not wholly account for this; it is the increased proportion of young people now seeking education beyond the secondary level that arrests attention. The Committee believes that this reflects a genuine demand on the part of the Australian community for increased opportunities for higher education. 1. (ii) The 20th century has been noteworthy for an exceptional acceleration in the rate of increase in knowledge. Translated into technological advance, this has resulted in societies of everincreasing complexity. Higher education, in both the sciences and the humanities, is an essential con dition for the stability and progress of such societies. 1. (iii) The Committee recognizes the interdependence of primary, secondary and tertiary education, and emphasizes that a balanced programme of educational development is essential. 1. (iv) The human values associated with education are so well recognized as to need little elaboration, but the Committee emphasizes that they are the very stuff of a free, democratic and cultured society. 1. (v) Education should be regarded as an investment which yields direct and significant economic benefits through increasing the skill of the population and through accelerating technological progress. The Committee believes that economic growth in Australia is dependent upon a high and advancing level of education. 1. (vi) Education in the humanities and the social sciences, as well as in the physical and biological sciences and technologies, plays an important role in the general education of all citizens and in specialized training for management and administration. 1. (vii) The Committee has framed its recommendations with the object of widening the range of educational opportunities beyond the secondary school, of providing extensive vocational and specialized training and of ensuring that Australia makes a worth-while contribution to the advancement of knowledge and of achievement.

  1. (viii) The Committee agrees with the view (widespread in Australia) that higher education should be available to all citizens according to their inclination and capacity. Such a view accords with the aspirations of individuals and serves the needs of the community in promoting dynamic economic growth. 1. (ix) The Committee recognizes that in certain specialized fields there may be conflict between individual aspirations and community needs. However, it believes that, in general, such conflict should be resolved by the operation of supply and demand. Research into future requirements for certain types of training is useful; but the Committee does not believe that the entry of students into various courses should be restricted to forecasts of future needs. This would circumscribe educational opportunity and involve the risk of grave error. 1. (x) Public interest in, and government support for, higher education have greatly increased during the past decade. The climate of opinion favours further expansion, and the Committee supports such expansion on both social and economic grounds.

When the Prime Minister delivered his speech, I was particularly interested to learn whether money would be provided for country tertiary colleges, particularly at Bathurst and Wagga in New South Wales. The people in the Wagga district and throughout the western districts of New South Wales and all people interested in decentralisation were also eager to hear whether money would be provided. I was disappointed, as were thousands of people throughout the western districts of New South Wales and the Wagga and Riverina areas, to learn that the recommendation of the Martin Committee has not been implemented. This is not because the Commonwealth Government has refused to take action in this matter but because the State of New South Wales has failed to honour its obligations and has failed to play its part.

I was deeply interested in the second reading speech of the Prime Minister on this Bill. I waited to hear his remarks about the Bathurst tertiary college. Great enthusiasm had been developed within the Bathurst, Orange, Lithgow and central western regions. The City of Bathurst was supported by the City of Orange and the City of Lithgow. The adjacent municipalities and shires all joined in support of Bathurst’s claim for a full university, to go beyond the tertiary college. All these people wanted to see the development in a city of learning of a centre of education that would work in conjunction with the numerous schools and colleges that exist there at present. I waited in vain to hear the Prime Minister refer to Bathurst and Wagga. Eventually he said -

No provision has been made for Commonwealth grants to new colleges at Bathurst and Wagga. The New South Wales Government has told us that it has no proposals for these colleges at present. Should such proposals be made in the future, the Commonwealth Government would be prepared to to give them favorable consideration.

If the New South Wales Government honours its promises and obligations and establishes tertiary colleges at Bathurst and Wagga, I hope that the sums of money mentioned by the Prime Minister on 24th March of this year will be made available, when presenting the report of the Martin Committee on 24th March, the Prime Minister listed the interim capital grants to colleges for 1965 and 1966. Colleges and institutions throughout Australia were mentioned and the list included the Bathurst college and the Wagga college. Each college was to receive an interim grant of £100,000. I hope that the money promised by the Prime Minister on that occasion will not be used in some other way but will be reserved for the purpose for which it was originally intended.

The Martin Committee emphasised the importance of Bathurst and Wagga. Its report is an outstanding document. The three volumes warrant the careful attention of honorable members. There can be no doubt of the need for increased educational facilities in Australia. At present, students are being turned away from our universities because of the lack of facilities for them. In the introduction to its report, the Martin Committee said -

The magnitude of the increases in university enrolments, for example, is shown by the following comparison: in the period 1946-63 the increase in the 17-22 year age group was 32 per cent., whereas the number of enrolments per 10,000 of the age group during this period increased from 230 to 740, i.e., by 220 per cent.

These figures demand the closest attention of the Commonwealth Government and particularly of the New South Wales Government, which has failed to honour its obligation to meet the educational needs of the people of that State. Shortly after it’s triumph at the election, the New South Wales Government turned its back on the need to decentralise centres of education throughout the State. The Minister for Education in New South Wales previously had promised the Mayor and citizens of Bathurst that he would support the development of education there.

The report of the Martin Committee contains an important statement that should not go unnoticed. It is -

The factors which determine national survival in the modern world require the Australian community to provide talented young people with opportunities to develop their innate abilities to the maximum. With its increasing dependence upon skills of all kinds, the community will rely upon their efforts for its future welfare. But more is required than proficiency in skills . . .

Of course, that point has been made very well indeed by the honorable member for Fremantle. It is doubtful whether the people of any previous age have been confronted with social, national and international problems as complex and as far reaching as those with which mankind is faced today. These problems call for the mature judgment of free and well-trained minds. This statement by the Martin Committee is significant; it is the key to the document itself. Where better could we find places for the establishment of tertiary colleges and the development of full universities than in the country districts? The report of the Martin Committee has mentioned such places and it is regrettable that the New South Wales Government has turned a deaf ear to the representations of people from country districts. The New South Wales Government has also ignored the considered views of the Committee, which are contained in this report. As appears at paragraph 6.88 of the report, the Committee stated -

The Committee sees advantages in developing tertiary colleges in two country centres - Bathurst and Wagga. Each of these towns meets most of the criteria mentioned earlier in this chapter (para. 6.26).

In paragraph 6.(v) in the conclusions and recommendations in chapter 6 at page 171 of the report we find this -

The Committee has given careful consideration to the submissions advocating the establishment of university institutions outside the metropolitan areas. While the Committee is convinced that there is no case for the immediate establishment of universities in the extra-metropolitan areas, it believes that some tertiary institutions should be developed in the country and that they might become constituent members of the various Institutes of Colleges. The Committee has recommended the development of tertiary colleges at Bathurst, Wagga, Toowoomba, Rockhampton, Ballarat, Geelong and Bendigo. The Committee envisages that diploma courses will be the main concern of the constituent members of the Institutes of Colleges.

I ask honorable members to note, Mr. Speaker, that Ballarat, Geelong and Bendigo are in Victoria and Toowoomba and Rockhampton are in Queensland and that the Governments of both those States have honoured their obligations.. They have accepted the challenge and provided funds and the Commonwealth Government has matched them £1 for £1 as provided for in this measure which honorable members on this side of the House are pleased to support this evening. I would be considerably heartened if we could say that the New South Wales Government had played its part - if it had respected the findings in the Martin report and had remembered its declarations in favour of decentralisation and educational institutions in country districts. It should be remembered that those persons who were members of the Martin Committee and who compiled this report are eminent gentlemen whose views are worthy of the closest attention and consideration.

It has been thought by some that universities should be established in country centres like those that have been mentioned.

Australia needs the fullest possible education of all the people who make up our society. Those who are not to become doctors or barristers or who will not excel in some other profession could perhaps succeed in animal husbandry, in understanding the soils of our country, in farm management, in marketing and in other fields that relate to the management of the rural sector of eur economy. All these fields could be the subject of teaching in tertiary colleges. There is also an obvious need for the extension of these educational services to meet the needs of increasing industrialisation in many of our country towns and cities.

It has been said by some that if a tertiary college were established in a country centre there would not be sufficient students to avail themselves of the facilities. It should be known, Mr. Speaker, that the establishment of a tertiary college at Bathurst and another at Wagga has been carefully considered and that these proposals have had the support of many people who have given the matter careful consideration. On the question of travel we ought to know that today people already travel for their education but at present it is country people who are obliged to go to the cities where they have to pay high charges for accommodation, especially in Sydney. If evidence of the success of a country university is required, let us think of the magnificent record of the University of New England at Armidale, which has made a fine contribution to the cultural development of this country, situated as it is in the country. We should not forget, too, that when the School of General Studies of the Australian National University commenced operations in Canberra in 1960 it had 216 full time students. We have the evidence in the Martin report of the 220 per cent, increase since that time and we have heard of students being turned away. So it is difficult to understand why the New South Wales Government has not co-operated a little more closely with the Commonwealth in this important adventure in the advancement of education in Australia.

Looking through the first report of the committee appointed by the Minister for Education in New South Wales to inquire into various aspects of higher education in that State, which was presented in August 1961, I see at page 105 a table giving the hypothetical distribution of university students in 1960. It gives the figure for the Mitchell region, which includes Orange, Bathurst and Lithgow, as 433. That number is higher than the hypothetical number given for almost all other country regions in New South Wales. It is exceeded only by the Wagga, Griffith and Cootamundra region, apart from the Sydney, Newcastle and Illawarra areas. These figures are eloquent in their way because they indicate that there would be at least 433 full-time students available for a university college at Bathurst. When one adds to this number those prospective students who live in the western districts of the State, one finds that there are 1,356 prospective students in the Mitchell, Macquarie and Lachlan regions, together with what is known as the Western Division. These prospective students would have the opportunity to take advantage of a tertiary college at Bathurst. Even if the number were halved, there would be 678 full-time students available to take advantage of the facilities of a tertiary college there.

Why should not students travel to a country university or tertiary college rather than travel from the country to the city to attend such an institution? Those who speak so glibly about decentralisation in New South Wales apparently have deserted its cause with respect to the establishment of educational institutions. It is regrettable to hear the melancholy story of that State in education today, with a substantial reduction in the funds voted for education at a time when there is a greater need than ever to provide for the education of our people in this great age in which we live when the sciences are so necessary to our future and when training in the humanities above all is required so that people may play their part as good citizens of Australia in this difficult and troubled time. As I have said, education to the fullest possible degree is urgently needed in these days. I support the Bill. I wish it a speedy passage. I can only hope that the New South Wales Government will have a change of heart in its attitude to education.

Dr MACKAY:
Evans

.- Mr. Speaker, I do not wish to add very much at this stage in the debate. I commend the honorable member for Macquarie (Mr.

Luchetti) for the many evidences of sincerity in his speech concerning the development of education and particularly its decentralisation. Unfortunately it is a fact of education today that most countries are unable instantly or in the immediate future to provide either the money or the teachers needed to meet the enormous requirements of modern education. This is certainly true of Australia where the demand for teachers far outstrips the number available. The number will inevitably lag behind the demand for some years to come. Even if all the honours graduates produced by the universities over the last few years were to go into teaching the number of teachers would still be far short of the number made necessary by the population explosion.

Whilst one can agree with the honorable member for Macquarie that it has been, perhaps, something of a disappointment to the people of Bathurst and Wagga that it is not immediately possible for the provision of these colleges envisaged in the Martin report, I think it should also be said that even the mention in the Martin report is something of a tentative or, rather, a suppositious nature. The Martin report says, in paragraphs 6 and 90, that a case exists for the expansion of existing tertiary facilities in Wagga to serve the Riverina area. It goes on to point out that there are, in point of fact, existing tertiary education institutions both in Bathurst and Wagga. In the -ase of Wagga there is a college which is adjacent to an area of some 80 acres held by the New South Wales Government for educational purposes. The Bathurst college, using also the facilities of the teachers and technical colleges, might offer, we are told, courses in the humanities, social sciences, education, science and technology. There is no question whatever that one day this will take place.

I remind the House that when the Prime Minister (Sir Robert Menzies) spoke on this question, what he said about the New South Wales Government’s decision was that that Government had told us that it had no proposals for these colleges at present. Anyone studying the budget for education in the State of New South Wales, seeing how much it is in excess of the amount being spent by any other State, and seeing also the provisions that are being made for expansion in a most farsighted and realistic way, could not join in anything like censure of a government which does not immediately race ahead to implement all the farsighted proposals that it has. I join with the honorable member for Macquarie in complimenting the Martin Committee on the farsightedness of the recommendations that it has made in its report. I simply want to set the record straight. There is not a decision on the part of the New South Wales Government to close the door on this kind of rural development or decentralisation of education. Far from this, there is a prudent realisation that at the present moment there is not a sufficiency of teaching staff, finance or equipment. 1 am sure that at the earliest possible opportunity there will be the expansion which has been envisaged in the report.

Mr BRYANT:
Wills

.- Mr. Speaker, allow me to give a lukewarm welcome to the measure before the House and a hearty welcome to the honorable member for Evans (Dr. Mackay) for being the first Liberal to notice that education has been discussed in the House for most of the day.

Mr Freeth:

– Nonsense.

Mr BRYANT:

– I shall repeat my statement. Excluding the Minister for Shipping and Transport, who is in duty bound to be here-

Mr Freeth:

– The honorable member now makes an exception.

Mr BRYANT:

– The Minister is not the exception that has proved the rule; he is just the one who has made the rule seem more appropriate. The honorable member for Evans seemed to give the impression that he came to the rescue of the New South Wales Government. It is interesting to me, because I have taken a pretty close interest in education both in the States and in the Commonwealth ever since I entered this Parliament, and before that time as an employee of one of the State teaching services, that there has been a radical change in atmospherics this year so far as the New South Wales Government is concerned. I have made innumerable speeches in the past, here and in other places-

Mr Freeth:

– Interminable, too.

Mr BRYANT:

– That is right, and they have had a great effect. Even the Minister and the Government have at last started to listen to the Labour Party’s point of view on education. No-one can say that the Government has not dragged its feet in the past and has now reluctantly come to the altar even at this late hour. In the past we on this side of the House have been able to point continuously to the advantages of education in New South Wales, as a result of some 25 years of Labour Government. In every field of statistics that one might choose - whether in the libraries of universities, whether in respect of the proportion of students who have reached matriculation level to the whole population, whether of graduates of universities - New South Wales has led the way. Yet here in the last three or four days we have had three demonstrations, the first of which was in the public Press which reported on a reduction in the budgetary provisions in New South Wales for education. It has been pointed out to me by one of my colleagues that tremendous promises were made in New South Wales before the election last May. On Friday, I think it was, the Robertson Committee said that the only State that had not given its point of view to the Government was New South Wales. The one which has not complied with what one would call the reasonable aspirations of education in this field was the State of New South Wales.

Mr SPEAKER:

– Order! I ask the honorable member not to begin a general debate on education.

Mr BRYANT:

– Mr. Speaker, this question was raised by the Prime Minister in his speech. It was mentioned in the Martin Committee’s report and it was mentioned by the honorable member for Evans, and I wish to put on record the facts of the case. I say to the honorable member for Evans: It is no good planning education facilities for two or three years’ time, for five years’ time, for 20 years’ time or for some time or never because this is the urgent need of people now. There will be a tremendous wave of young people entering the tertiary education system in the next year or two. They will pass this way but once. Unless there is a radical change in the whole education system of Australia, there will be no way in which those who have missed the opportunity now will pick it up later because education, by its very nature, is conservative. This statement is borne out by comments by plenty of people who have spoken on education. I noticed today a statement by C. P. Snow who said -

In a society like ours, academic patterns change more slowly than any others. In my lifetime, in England, they have crystallised rather than loosened. I used to think that it would be about as hard to change, say, the Oxford and Cambridge scholarship examination as to conduct a major revolution. I now believe that I was over-optimistic.

I think that, by its very nature, education is conservative, but we should be taking up a new challenge in the way in which the Prime Minister has brought it before us in his comments on the report of the Martin Committee. As the honorable member for Fremantle (Mr. Beazley) pointed out, this was designed to be a new look at the tertiary education system. Unfortunately, there is no demonstration of this so far as these grants are concerned, although the sum of £2,400,000 is not insignificant. In fact, it is quite a commitment on the part of the Commonwealth. To that extent, we on this side of the House, and I presume the community generally, are grateful to see it Nevertheless, I think it is time, on an occasion such as this, to examine the significance of this field of education. The report of the Martin Committee stated -

The pattern of tertiary education in Australia today, when compared with that established in most English speaking countries, is simple and rather inflexible, lt depends upon a framework of institutions of which there are three main types: universities, teachers’ colleges and those technical colleges which award diplomas.

This is the general theme of the comment of the Martin Committee on tertiary education and education in general. It said that, although in the world at large education is generally conservative, it is what I might describe as the conveyor belt of society by which culture, etcetera, is passed from generation to generation. By its very being and purpose it is to conserve each generation’s culture and to pass it on to the next. But Australia’s education, in the general spirit, is even more conservative than that of most countries. I believe that at this stage the Commonwealth should be taking a more effective and individual interest in the way in which this college system is to be developed. I say in answer to the honorable member for Evans that from my point of view, and I think from the point of view of others on this side of the chamber and the public generally, one of the most important sections of the report of the Martin Committee was that the Commonwealth accept a more effective or larger commitment in teacher training. The honorable member admitted that teachers represent the most active shortage in this section of the education system. The Commonwealth must step into this in such a way that it takes an overall look. I do not believe in overall direction. I think that in the field of education there are great opportunities for co-operation right across the board of politics. In my personal experience, the committee consisting of members from this side of the House has found no difficulty in the last few years in meeting and talking of education to people of all levels and all political persuasions. I think there is a great opportunity in this respect for the Minister in Charge of Commonwealth Activities in Education and Research (Senator Gorton). I know that the present Minister has done this in many ways. He has got the State Ministers together more often and is acting in a more effective co-ordinating way. But the Commonwealth will have to give itself much more ginger in relation to those questions so that it provides direction. Lack of co-ordination, lack of system and an absence of intention to develop an overall attitude have been the almost unfailing characteristics of the Australian educational system. The system is inclined to develop piecemeal, so that each fragment gets out of focus with the others. For example, we will be opening tertiary institutions at one level but will be running out of teachers at another level. We should therefore accept the teacher training commitment recommended in the Martin Committee’s report. I am reminded of a statement by Commissioners who were appointed in 1854. It was -

We take the opportunity of remarking that all the recent legislative measures on educational matters appear to have no connection with each other; whence it happens, that with all the requisite materials for forming a comprehensive system, the Colony possesses no system of education at all, in the proper sense of the word.

We on this side are not advocates of a regimented, bureaucratic, centralised system. Anyone who cares to study our policy on education will see that that is far from our minds. I believe that would be bad for education generally. I believe that education is a field for co-operation rather than coercion. I think, too, that Australia will have to study what is being done by other nations.

As the honorable member for Fremantle (Mr. Beazley) has pointed out, the institutions recommended here are of a highly technical, almost supremely specialist nature. I suppose the Royal Melbourne Institute of Technology is the one with the widest scope, but even its non-technical divisions like the Public and Business Administration. Division and the special division which covers the humanities and mathematics are very narrow compared with the great breadth of the activities of the Institute. I am hoping that as a result of this action by the Government there will be a development of the status and quality of education at the top of these institutions. I do not agree with what the Prime Minister (Sir Robert Menzies) had to say - referring to the Martin report, from which this legislation flows - on the question of degree granting. I personally think that there is a possibility of giving degree status to students at these institutions, without giving the institutions the formal charters of universities. I cannot see any reason why there should not be some sort of personal degree granting at these institutions, perhaps at the bachelor level, on the lines of the procedure for granting Master’s degrees and Doctorates in universities. It is a matter of the academic and intellectual integrity of the staff. I have no reason to believe that the senior staff at institutions such as these will not have the same kind of intellectual and academic integrity as the people who administer universities.

The problem of education, as the honorable member for Evans (Dr. Mackay) has pointed out, is world wide. The “World Year Book on Education “ for 1965 has this to say -

A rapid expansion of the educational system is now taking place in nearly every country. Despite the diversities of popular attitudes and public policy and the many particular local social settings for this world-wide movement, everywhere it has fundamentally similar roots, and it is bringing about many parallel results.

One of the causes of hope for the world is that men run into the same kind of prob lems, whether they live in Canberra, Timbuctoo or Ottawa. Education administrators throughout the world are tackling their problems in much the same way. Generally speaking, however, the Australian approach to tertiary and senior secondary education has been more limited in scope than has been the case elsewhere. For example, Denmark is noted for its folk high schools. Honorable members might be interested to read about them and find out what are their functions in the community. Finland has folk academies, and civic and workers’ institutes. As one goes through the “Year Book “, one finds that exploratory or new methods are being introduced all along the line. For example, in the part dealing with Finland there is a reference to the integration of library services with the school system. That is something that could be developed here. Everybody who operates in this field is very much aware that the Australian library services leave much to be desired.

In Canada, the education authorities are considering the length of the school year. This may well be something that the university system of Australia could examine. I am sure that the universities, compared with technical institutes, are completely uneconomical. At the Royal Melbourne Institute of Technology, the cost of a course in chemical engineering is something like £120 per student, compared with an average cost of between £450 and £500 for a student at the University of Melbourne. One of the things that struck me was that students at the Royal Melbourne Institute of Technology appeared to be doing the same quality of work, and in fact devoting a greater length of time to it. They are doing work of a more specialised nature than are students at the universities. We may be developing in the university system an overindulgence in finance, without giving enough consideration to work factors.

Two countries which have probably explored this field of tertiary education more than any others are the United States of America and the Union of Soviet Socialist Republics. Last year when I was briefly in the U.S.S.R. I was impressed by the number of young people whom one encountered who were attending different kinds of tertiary institutions. The Russian system did not seem to be so university bound as the Australian system is. But Australia is not the only country which is in this position. The system in Britain is in a similar position, and I am pretty certain that that of Japan is also. The Russian capacity for expanding tertiary education and apparently giving people fairly high powered technical or professional training without using the university system must be fairly well known. There are industrial and civil engineering colleges, transport and communications colleges, agricultural colleges, medical and physical education and sports college, al operating at the same level. There are art and cinematography institutes, teacher training institutes and so on. This is something that I think the Australian education system will have to face up to.

The honorable member for Macquarie (Mr. Luchetti) referred to the difficulties confronting country students. I do not know that any State has done any real work in this connection. Perhaps Western Australia has done something towards providing boarding facilities at specialised places for country students. But how will the young person who lives in Sydney get on if he wants to go to Ballarat or to the Gordon Institute of Technology at Geelong, or the Bathurst Institute if it is established? How will he get on unless there is some overall official approach to the question of accommodation?

I think, furthermore, that at this level we will have to have some machinery which will allow people to enter or re-enter the educational system at a higher age than 18 or 20 years. In these modern days, no person’s initial training, particuarly technical or artisan training, can be guaranteed to carry him through all his working life. The person of 40 years of age is not beyond hope of retraining. Literally thousands of us found this was the case after the war. The Commonwealth Reconstruction Training Scheme was a wonderful demonstration of what can be done with people who, educationally speaking, were considered to be in the sere and yellow leaf stage when they came back from the war. Literally thousands of such people passed through educational institutions, some of them achieving very high academic distinction. The person at 40 is not lost beyond recall. With a retiring age of 65 years, he has 25 years of working life before him.

I believe this applies also to large numbers of women, both married and unmarried. Married women whose families have grown up and who are fortyish still have a quarter of a century of productive work ahead of them, if one looks only at the aspect of work in the community. But there is a lot to be gained from work beyond the envelope on pay day - so they tell us, anyhow. The person who feels useless does not lead a satisfactory life in the modern community. I should like the Commonwealth to investigate what we might call the wider fields of adventure in tertiary education, whether it be by providing institutes of higher training or other establishments to which people whose training may have been neglected in the past may go for training or retraining. Tremendous capacities were undeveloped during the 1930’s which we could perhaps develop, thus gaining a new generation as it were. This to me is the challenge of education at the Commonwealth level. Money is not everything. I do not think .ve will get far by adopting the piecemeal approach that has been demonstrated here.

As I said earlier in the debate, although my welcome to the measure is lukewarm the bill nevertheless is gratefully and, I hope, graciously received. I presume that if we continue our advocacy from this side of the House, with the assistance of the Minister for Shipping and Transport (Mr. Freeth) who by remaining at the table this afternoon and this evening has demonstrated his keen interest, we will be able to make further progress and there will be continuing measures of this sort, and perhaps before the next election the Commonwealth may well appoint a Commonwealth Minister for Education.

Mr FREETH:
Minister for Shipping and Transport · Forrest · LP

– Earlier in this debate, and by way of interjection, I suggested that the honorable member for Wills (Mr. Bryant) inflicted his views on education on this chamber interminably and unendurably. I do not depart from that belief, but lest I be accused of the same thing I want to reply briefly to the three points that the honorable member for Fremantle (Mr. Beazley) raised on behalf of the Opposition. First, he said that he hoped that this Bill would be a harbinger of further progress in the field of technical education. As to that, the Government proposes that there will be a triennium arrangement in this field in the same way as there is for universities. His second point was that the House should be furnished with reports on this subject from time to time. Triennial reports of the committee appointed will be published, together with the Government’s decisions on what is proposed in each triennium. Thirdly, he said that he hoped there would be an increasing development of new type institutions outside universities. The Wark Committee is very conscious of its wide charter to promote balanced development of tertiary education outside universities. The Government is equally conscious of the importance of this new field of tertiary education. I commend the brevity with which honorable members have greeted this Bill and, as I should like to show similar brevity, I make no further comment.

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. Freeth) read a third time.

page 3143

INCOME TAX BILL 1965

Second Reading

Debate resumed from 28th October (vide page 2323), on motion by Mr. Harold Holt-

That the Bill be now read a second time.

Mr CREAN:
Melbourne Ports

.- This Bill imposes the rates of taxation on individual incomes for the current financial year. It increases the rates that were current for last year on the basis of a flat increase of 6d. in the £1 on the tax previously payable. The Bill also converts the existing scale into a percentage scale that will be available when the change to decimal currency takes place on 14th February 1966. Finally, the Bill also simplifies the name of what was previously called “ income tax and social services contribution “ to “ income tax “.

The Opposition opposes the Bill for two reasons. We do not think that the increase in taxation is necessary. It is proposed, by the 2i per cent, increase, to increase the yield on income tax in this financial year by £17.8 million. For reasons which I do not want to traverse again, because they were raised in the Budget debate, we regard this increase as unnecessary. However, if the increase were necessary, the money could have been more equitably raised than by the imposition of a flat increase over and above the rates that were previously current.

I want to take the opportunity to look at the income tax rate structure. To give honorable members some idea of the importance of this tax let me refer to the Budget Speech delivered by the Treasurer (Mr. Harold Holt) on 17th August last. In the papers accompanying his speech was a summary of Budget results, 1951-52 to 1964-65, and the estimated results for 1965-66. This showed that for the year ending 30th June 1966 the estimated yield from individual income tax will be £898,720,000, or near enough to £900 million. In addition, the tax on companies is expected to net £393 million or, in round figures, £400 million. The rates applicable to individuals and companies this financial year will be responsible for raising some £1,300 million out of an estimated total of £2,134,760,000 to be collected from taxation. Income tax on individuals and companies is by far the preponderant form of taxation in Australia.

It always astonishes me that there is scarcely any debate in this House devoted to the rates of taxation. Plenty of honorable members will speak when individual deductions or individual concessions are involved, but there is scarcely any debate at all on the overall tax rate structure. As far as I know I am the only person listed to speak on this measure. I hope that after my remarks some other honorable members will be prompted to participate in the debate. Income taxation is responsible for collecting £900 million from individuals and £400 million from companies. Honorable members may not be aware of it, but the present rate structure has been in operation for more than 10 years. It is true that there have been flat rate reductions of tax amounting to 5 per cent, and now we have a fiat rate increase of 2i per cent. But basically the rate structure, or the progressive structure, which is the better term to apply, that was thought to be equitable in 19S4-S5, is still regarded as equitable in 1965-66.

If honorable members are not aware of what has happened in that period let me refresh their memories by directing their attention to the statistics relating to prices and wages contained in document F of the second volume of the Vernon Committee’s report. Taking a base of 100 in 1949, the report shows that the consumer price index has risen in 1965 to 210; or if we go back to 1954 - the year in which the rate structure became fixed - we find that the consumer price index stood at a figure of 161. It is now 210, which means that the value of money has decreased by about one-third. In other words, it now takes 27s. or 28s. to buy the same amount of goods and services as could be purchased 10 years ago for £1. Yet the rate structure today is the same as it was in 1954-55.

The point I make is that in a modern community we regard the income tax as the central tax and as the most equitable tax. This is because we say that the higher a person’s income, after making allowances for family commitments and other things, the less each increase in income means to him and the more he is able to pay in tax without carrying any disproportionate burden. This is the theory underlying a progressive tax structure. If there is any logic in a progressive tax structure - I will shortly examine the logic or, I suggest, lack of logic in our present tax structure - the structure that was thought to be equitable in 1954-55 when the purchasing power of money was one-third higher than it is today surely cannot be regarded as equitable in 1964-65. Later, I will refer to the value of tax concessions, because they distort the realities of income tax.

In the past, inflation has been running at about 2i per cent, per annum. This means that over a 10 year period the value of money has decreased by about 25 per cent. At times in our history inflation has been running at an even higher level than at present. But if there is to be this kind of acceptance of inflation in the community, equally there should be an acceptance of a periodical revision of the progressive tax scale. One of the difficulties here is that you are dealing with what are really mathematical propositions which generally do not concern the man in the street. At least, he does not think they concern him. In my opinion, finally they do concern him, but if you ask the man in the street by means of a gallup poll, which seems to be the method of sensing public opinion on certain issues, what a progressive tax scale is, he probably would not have a clue. It is for that reason that essays of this kind are a little difficult to make comprehensible, possibly even in a chamber such as this. But at least I make the point that the scale is a mathematical one. A flat rate increase or decrease really runs counter to the theory of progression. That is one reason why the Opposition has opposed flat rate decreases as well as flat rate increases in taxation whenever they have been introduced. Also, inflation destroys any given basis of progression because if the assumptions were equitable when you had a given value for the £1, they become inequitable and distorted when, as a result of inflation, the value of the £1 falls.

It is difficult to contemplate, the incidence of income tax without looking at the deductions that are allowed to people before their tax is computed. After all, we do not at this stage pay tax on gross income. We pay tax on gross income minus certain allowances, the principal ones being in respect of dependants - wives and children - and medical expenses. In addition, if you are a prudent person or have a good income and wish to save money you may devote certain sums to life insurance. Sums so devoted are allowable as deductions. A person’s taxable income is his total income less the deductions that are available to him. I want to look at what is happening in the tax structure in Australia in this direction because you cannot properly evaluate progression unless you relate it to the deductions that are allowed from income before finally assessing tax. The progressive scale is simply something that has applied since 1954-55. It makes no allowance for deductions taken off income in computing taxable income.

Each year the Commissioner of Taxation publishes a volume of tax statistics. I have commended this publication on other occasions. The latest publication is the Commissioner’s 44th report, which was tabled a month or so ago in the House. It gives comprehensive statistics about the collection of income tax in Australia. Unfortunately, because of physical difficulties and the fact that tax on income for the year 1964-65 is only beginning to be assessed now and will continue to be assessed until about July 1967, it is difficult to have the figures up to date. But the latest report contains statistics relating to incomes in the year ended 30th June 1963, which is not so very long ago. The report shows that in that year there were about 4,554,000 taxpayers. Their total income before allowing for deductions amounted to about £5,200 million.

Again it is difficult in these exercises to avoid getting into rather astronomical figures, but by the time you allowed these various concessions, concessions for wives, housekeepers, dependant children, medical expenses, life assurance and the like, and they aggregated £1,055 million, your original tax base, of your actual income to start with, of £5,204 million, had been whittled down to £4,128 million. It was on that residue of income that the tax was applied. When the tax was applied in the particular year I am considering it yielded a total tax from individuals of £527 million. I hope that in the future, perhaps each year, the Commissioner will give some sort of estimate of the loss to the revenue, or the amount of revenue foregone if you prefer to think of it that way, by allowing these concessions. I know it is difficult to make such a computation because there would be variations according to the total amount of taxable income and there would be variations according to the various income ranges. Nevertheless I think it is possible to make a reasonable assessment.

As I have said, in this particular year the deductions that were allowed overall to the 4i million taxpayers amounted to £1,055 million. I make a rough sort of calculation - and if anybody else can better it he is welcome to try - on an overall average of 5s. per £1 as representing the value of the tax foregone. I have actually asked questions about this matter on notice on previous occasions and, making allowance for certain factors, I think my assessment is reasonable enough. It would be under rather than over. On this basis the Government, by allowing deductions amounting to £1,055 million, loses in revenue at least £250 million. The figure could be as high as £300 million. This is in terms of a final tax yield of £527 million. In other words, by allowing these various and rather ramified kinds of concessions the amount taken away from the revenue is nearly one-third of the total that would be potentially available to it.

Let me then relate these amounts to the concessions that are allowed on the family side. There are allowances made for spouses, for a start. One cannot be completely accurate as to numbers because there would be the odd few housekeepers, married daughters and the like, but they would be marginal in terms of the total. We then go on to multiply the total number of wives by £143, the total number of first children by £91 and the total number of other children by £65. We then find that these concessions are worth various amounts in the various income ranges. Again it is easy enough to make alternative suggestions as to what ought to be done, but the point I want to make is similar to one that was made in the discussion we had last night on the Superannuation Bill. What is going on in the income tax structure is something that runs counter to what the community is trying to do by means of social services. Furthermore, it really results in a redistribution of income in the wrong direction, because the concession allowed for a wife or a child is worth more in actual money terms - and do not forget that it is the revenue that finally loses on this - as the income of the taxpayer becomes higher. I do not regard this as either a very equitable or a very sensible way to approach this problem.

I have prepared a table which I have before me. Again I hope that if anybody queries it at least he will take the trouble to check it and make a calculation for himself. I have taken the figures that are contained on page 28 of this document and broken them down according to various income ranges and also according to numbers of spouses and numbers of children. I have then related the information to the other deductions that are allowed, and I shall give the House the final picture that emerged. I have taken first the income range from £105 to £1,000. These are actual incomes, the incomes that people receive as wage earners, farmers, professional people, business people. They are the actual gross incomes recorded. I realise that the minimum taxable income is now £208, but in the year in question it was £105. In the range between £105 and £ 1 ,000- individuals earning up to £20 a week- there were 2,257,000 taxpayers, nearly one half of the total number of laxpayers. Of course in that group we had the bulk of the single people. In that group also we had the incomes of those indulging in a practice that is becoming prevalent in our tax structure, known as income splitting. In certain circumstances it pays a husband and wife who both earn incomes, or it pays people engaged in partnerships or like arrangements, to ..divide the total income into two or more parts, with a consequent loss to the revenue. This sort of practice is very well described in the book “Taxation in Australia “ by Professors Downing, Arndt, Boxer and Matthews, which was published two or three years ago, and in which the term “ income splitting “ appeared.

As I have said, in this group of taxpayers earning from £105 to £1,000 we had most of the young single people and most of those indulging in income splitting. In that group deductions were allowed for only 264,000 wives, 274,000 first children and 243,000 other children. I have worked out an estimate of the face value of the concessions to that income group on the basis I have described. Actually it would be less than my estimate because the concessions work progressively in favour of the higher income earners. The figure I have arrived at is £205 million, of which £80 million is the value for wives and children.

Then I come to the next income group, which I think would include the average income earners in the community, those earning between £1,000 and £1,300 or £20 to £25 weekly. There were 957,000 such taxpayers, representing about one fifth of the total number of taxpayers. They had 422,000 wives, 417,000 first children and 473,000 other children. The face value of concessions to them was £264 million, of which £129 million was the value for dependants. I have then taken one other group, those earning £1,300 or more - that is. people receiving more than £25 a week. They numbered 1,340,000, or between one quarter and one third of the total number of taxpayers. They supported 701,000 wives, 773,000 first children and 858,000 other children. The value of concessions to that group was £586 million. More than half of the total tax concessions went to between one quarter and one third of the total taxpaying public. It seems to me that there is at least some measure of inequity in that sort of distribution. The other significant factor is that the part of the £586 million which is attachable to the deductions for wives and children comes to £226 million, leaving about £360 million for the rather fancy sort of deductions - deductions for insurance, education and medical expenses and so on.

I was interested to hear an honorable member say during the Budget debate a few weeks ago that he had talked about a certain subject in this House for five years. I have talked about this subject of taxation for ten years. It is time something was done about our ossified structure of taxation because it is becoming increasingly inequitable. It is becoming more and more contradictory in relation to the structure of social services generally. At a rough guess, it would not cost the community as much, if we cut out all the tax concessions except the concessional deduction for a wife, and were to double that deduction as the present system costs. I am simply making that suggestion as a rough approximation to a solution of the problem. If we were to double the allowance for a wife and cut out every other concession now available under the Income Tax Act that would do justice to more people than it would do injustice to. What we cannot assess at ‘the moment is the relevant degree of injustice that is being done because of the way that concessions are allowed. We have a system of child endowment that is supposed to be reasonable rather than just a monument to the past. We have a system of medical and hospital benefits that is supposed to equate to something like a rational system. Why should we allow deductions for children and for medical expenses as well? I propose to show the cost to the revenue of some of these deductions. Each year the Commissioner of Taxation selects certain of these concessions and sets out the amount of the claims made. He does not take the same concessions every year. For the year that we are considering, the year ended June 1963, the amount that taxpayers in Australia claimed for net medical expenses - that is, the amount that was claimable after taxpayers had been reimbursed by medical benefits funds - was £143 million. The contributions that the taxpayers paid to medical and hospital benefits funds amounted to another £37 million. So, between them, the concession in respect of net medical expenses, which, as I have said, are the medical expenses after reimbursement, and the concession that is available in respect of contributions paid to such funds as the Hospitals Contribution Fund of New South Wales, the Blue Cross Society and the Australian Natives Association, amounted to £180 million. On the basis that I have used - I suggest it is not unreasonable - that it costs the revenue 5s. in the £1 for all this, the revenue lost £45 million because people were able to claim for medical expenses and for contributions made to medical and hospital funds. Are we not getting to a rather ridiculous state of affairs in the community? We have a hospital and medical benefits scheme under which people belong to a benefits fund or a friendly society. About three-quarters of the community make weekly payments to such funds- When a doctor’s account comes along they send a claim in to the fund and receive a certain part of the amount back. They are able to claim the residue of the account as a deduction in their income tax return. I do not know what the total deductions claimed for payments made to medical and hospital benefits funds would amount to, but the figure must be at least £37 million if the Commissioner of Taxation is not being jinked by people making dishonest claims. I do not think he is, because he has adequate means of checking up. Some years ago chemists were authorised to collect a tax of 5s. for every pharmaceutical benefits prescription they dispensed. This brought in a few million pounds. The Government said that this was necessary because it could not afford to meet the claims that were being made. Yet we have the sort of device I have mentioned going on under our noses, as it were, and nothing is said about it.

There is another item that is worthy of comment. The honorable member for Sturt (Mr. Wilson) raised the matter last night when we were debating the Superannuation Bill. The Commissioner for Taxation does not collate in his statistics for the year under consideration the amount of life insurance premiums and payments to superannuation funds that were claimed as allowable deductions. He showed the statistics for the previous year, and I suppose there would not be a great deal of difference in the figures. There might be a margin of some £50 million between that year and the previous year. For the previous year the total amount of income tax deductions claimed in respect of the payment of life insurance premiums and payments to superannuation funds was £160 million. Applying the same formula as I did before, of an average rate of loss to the revenue of 5s. in the £1, that means that by allowing premiums paid to life insurance companies and amounts paid to superannuation funds as deductions for income tax purposes the Government collected £40 million less than it might otherwise have done. It is possible to claim as deductions payments of life insurance premiums and payments to a superannuation fund amounting to £400 a year.

Mr Barnard:

– Considerably more than can be claimed for a wife.

Mr CREAN:

– Yes. That works out at £8 a week. How many people can afford to save £8 a week? Why should they be reimbursed by the Treasury if they do save that much? The higher a person’s income the greater his capacity to pay such premiums and therefore the greater the bonus he receives from the Government. It seems that this too is contrary to systems both of logic and of justice. It is about time we had a look at it. There are all sorts of contradictory assumptions.

I am sorry that I have not readily at hand the scale of allowances for children, but I suggest that they are worth, in terms of revenue, nearly as much as the cost of child endowment. Surely if we were to cancel deductions for children under the Income Tax Act and double the amount payable by way of child endowment we would bring about much more equity than injustice. The majority of the people who would obtain the benefit from this are those in the lower ranges of income, whereas at the moment the benefit is skewed, as the statisticians say, in the wrong direction, because the higher a person’s income the greater the worth of the concessional tax deduction. I am simply raising these points for consideration by the House in the future. There has been a lot of talk about appointing a special committee to examine tax law amendment. What I am suggesting is that mainly such amendments affect very few people in the community, and I hope to say something more about this when we get on to the other Bills. I repeat that it is time some consideration was given to the structure of our income tax system as a whole, particularly taking into account such factors as the fact that progress is being stultified to some extent because inflation has eroded the value of money.

The value of such concessions for families as are allowed has not risen as rapidly as the value of money has fallen. For instance, let us take the case of a man who was allowed a tax deduction of £104 in 1952-53 for his wife. That amount was raised to £130 in 1953-54 and to £143 in 1957-58. It has remained at that figure ever since. I have made, as the first step in this proposal, the simple proposition that more people would be advantaged than would be disadvantaged if the allowance for a wife were doubled and all other deductions were cut out altogether. Perhaps the amount of money that was saved - it could be of the order of £150 million - could be used to pay better sums of child endowment. It could be used to provide a much more effective and systematic hospital and medical benefits scheme than is currently the case. Of course, if the Government was to cut out some of these deductions immediately, it would cause confusion in a lot of other places because as we will see in the next measure to be considered-

Mr DEPUTY SPEAKER (Mr Lucock:
LYNE, NEW SOUTH WALES

– Order! I ask the honorable member to keep to the subject matter of the Bill.

Mr CREAN:

– I am trying to keep to the structure of the rates. You will see, Sir, that a number of the things that are complicating the Income Tax Act are doing so purely because of the existing rates structure. Whether a certain thing is done or is not done is not so much a matter of its merit in itself but of whether it is a saving. It seems to me, taking into account the tax deduction that is available, not to be a very logical sort of proposition on which to frame certain social assumptions.

Mr. Deputy Speaker, I will sum up briefly some of the aspects of this matter. We on this side oppose this measure because we think it flies in the face of progression. When an increase in taxes is to take place and it is deemed that some of the burden should fall in the income tax field, it flies in the face of progression that the increase should be a flat increase. It ought to be so framed that those with the greatest ability to pay provide a higher proportion of the increase than do those lower down on the scale. I invite honorable members to look at the new tax scale which is contained in “Statutory Rules, 1965, No. 133, Regulations under the Income Tax and Social Services Contribution Assessment Act 1936- 1965 “. This is the document that anticipates the particular rates that we are contemplating at the moment. If honorable members take the case of that healthy animal in the community that is described as the average wage earner - a very useful statistical device when people are trying to say how prosperous a country is - they will find that the average weekly wage at the moment is approximately £25. If the average wage earner is a single man he pays under the new tax scale £3 8s. per week out of his £25 per week. So, his average wage is whittled down by £3 8s. a week. If he is married, he is allowed a deduction of £143 a year for his wife. This has the effect of reducing his tax liability by 13s. per week. It is beyond my comprehension, to say the least, if anybody thinks there is any reality about allowing a married man to pay 13s. per week less tax than a single man. If the married man has one child, the amount of tax he pays is reduced from £2 15s. only to £2 7s. per week. In other words, he saves 8s. per week in tax by reason of his first child. If he has two children, he pays 5s. per week less in taxation. But his income tax is still £2 2s. per week. This example highlights the whole question of a progressive tax scale. Does anybody think that there is equity, justice or anything else in the fact that a married man, on £25 per week, with a wife and two children - I would find it difficult to manage on £25 a week - has to pay £2 2s. per week in income tax compared with the payment of £3 8s. per week by a single man? To my mind this is indicative of the sort of injustice that has crept into the tax scale.

If there is such an unfortunate person in the community as the basic wage earner who receives £16 per week, he does not escape. A single man in those circumstances pays £1 9s. per week in income tax. If he has a wife, the amount is reduced to £1 per week.

Mr Chaney:

– That is assuming that he has no deductions.

Mr CREAN:

– Yes. I am arguing about the position of this man with a wife. Does the Minister for the Navy think there is any equity in a man on £16 per week paying £1 per week in income tax? If this man has one child he pays 15s. per week instead of £1 per week. If he has two children, he pays lis. 6d. per week. Can a man in our civilised community live as a human being, bearing in mind Mr. Justice Higgins’ concept of an ordinary human being, if he is in receipt of £16 per week and, with a wife and two children to support, still has to pay lis. 6d. per week in income tax? I know somebody will say that he receives £1 or 15s. per week in child endowment. To my mind that only highlights the contradictory things that are going on. The Government drags in child endowment when it suits the Government to do so. But nobody is prepared to make this sort of analysis of the contradiction between what we are purporting to do by raising social service payments and what in fact we are doing by these concealed bonuses that are contained within this taxation nexus - nexus is a very popular word at the moment - that nobody sees and people seldom want to reveal.

For those reasons, Mr. Deputy Speaker, we oppose this measure. We regard it as inequitable. I have taken the opportunity here to try to point to some of the things that have come into our tax structure for the simple reason that we have not bothered to change it for more than 10 years. Equality, common sense and human decency demand that something be done about these things.

Mr WILSON:
Sturt

.- Mr. Deputy Speaker, I find I am unable to support this Bill because it contains certain principles or certain provisions which I regard as entirely contrary to all the principles of taxation, justice and liberalism. Therefore, I cannot support the Bill in its present form. I do support some portions of the Bill. I am not prepared to oppose the Bill as a whole. I have endeavoured to get the withdrawal or postponement of the obnoxious part of this Bill without success. Therefore, I am in the position of being left with no alternative but to say that I cannot support the Bill and that I will be unable to vote on it.

The obnoxious provisions to which I refer are proposed new section 6 (8.) and the Seventh Schedule of the Bill. The combination of the section and the schedule imposes a completely vicious tax upon the most worthy section of the community - workers and employees who have been thrifty and who have contributed to superannuation funds. The tax imposed is a tax of 50 per cent, of the income of the funds. Let us see how vicious it is by comparing it with the tax that would be payable by an individual. An individual with a taxable income of £400 would pay a tax of £16, but a superannuation fund, which was established for the benefit of the employees of an industry, would pay £200 under the Seventh Schedule.

The Treasurer (Mr. Harold Holt) in introducing the Bill attempted to justify the provision by referring to the report of the Ligertwood Committee. The Treasurer said -

The Bill also declares special rates of tax under legislation introduced last year following the Government’s consideration of the report of the Commonwealth Committee on Taxation 1959-61, commonly referred to as the Ligertwood Committee.

Let us look at the report of the Ligertwood Committee. I refer to paragraph 742 on page 155 of the Committee’s report. Dealing with superannuation funds, the report states -

Remedial action, whilst necessary, should not prejudice the operation of bona fide superannuation funds.

The Bill now before the House places a penalty tax of 10s. in the £1 on all superannuation funds. Then the Income Tax Assessment Bill, which is not before the House at present, contains certain escape clauses which will, if complied with, enable an escape from the tax. But in my opinion this Bill flagrantly flouts the decision of the Ligertwood Committee in that it prejudices the operations of bona fide superannuation funds. The report of the Ligertwood Committee continues -

However, the remedy to be adopted must be sufficiently strong so as to prevent existing abusive practices and to overcome possible future exploitation of the Revenue.

I am sure that every honorable member will agree with those sentiments. The report goes on -

We consider that any alteration to Section 23 ay-

That is the relevant provision - should, to some extent, restrict the exemption of future earnings of funds which have hitherto been created to exploit that Section.

The Committee says that the exemption of income of these funds should be restricted. Not one word is said by the Committee about a penalty tax of 50 per cent. In other words, if a fund does not comply with the provisions of the Income Tax Assessment Act, the Ligertwood Committee says it should lose this benefit. However, the Seventh Schedule says something entirely different - not that the fund should lose its exemption but that it should pay a penalty tax of 10s. in the £1.

The Ligertwood Committee’s report continues -

Our plan provides for a series of tests to guide the Commissioner of Taxation as to which funds should continue to qualify for full exemption or which funds should be given a partial exemption - subject always to the provisions of the new Division 9b.

What the Ligertwood Committee had in mind was that superannuation funds, which are created for the benefit of employees in industry, which encourage thrift and which provide capital for the development of this country, should receive exemption from income tax when they are bona fide funds. But the Ligertwood Committee says that, when they are not bona fide funds, they should lose their exemption. The Bill before the House does not follow the recommendations of the Ligertwood Committee. It imposes a penalty tax of 10s. in the £1 on all superannuation funds, and then the Income Tax Assessment Bill provides that, if the funds are altered to meet the requests of the Commissioner of Taxation, they can be exempted from the penalty tax of 10s. in the £1.

I know that substantial discretions are given to the Commissioner of Taxation and

I for one cannot speak too highly of the manner in which he administers the legislation. I have always found him to be most considerate and willing to hear points of view and my strong opposition to this Bill is not in any way a reflection on the Commissioner of Taxation or the administration of his Branch. What I believe is that employees should not be placed in the predicament of having their bona fide funds made subject to a tax of 10s. in the £1. Let me give an example. The Commissioner of Taxation has the right to exempt a fund from the penalty tax of 10s. in the £1 provided the employer makes a contribution to the fund in every year. The fund may have been in existence for 20 years. Employees may have contributed their ls. or 2s. to the fund each week and the fund may have been subsidised by the employer. There may now be thousands of pounds in the fund to provide retirement benefits for the employees. But next year, if the employer says: “ I will not contribute to the fund this year “, the fund loses its exemption. Who is punished? The employer who has not contributed is not punished, but the employees who for 20 years have been contributing to the fund are punished. All of a sudden the income of their fund becomes liable to a tax of 10s. in the £1. Therefore, I find myself completely unable to support the Bill while this provision remains in it.

The section of the Income Tax and Social Services Contribution Assessment Act 1936- 1964 to which I refer is section 121 ca. I will not read all of the provisions of the section, because they are lengthy, but I will deal with the marginal note. The section refers to the assessment of income of superannuation funds to which section 23f applies. Section 121cb applies to the assessment of income of superannuation funds established for the benefits of employees and other persons. Section 12 Ida refers to the assessment of the income of other superannuation funds. The Seventh Schedule to the Bill contains the following provision -

The rate of tax in respect of the taxable income of a superannuation fund in respect of which the trustee of the fund is liable, in pursuance of either section 121ca, section 121cb or section 121da of the Assessment Act, to be assessed and to pay tax is fifty per centum.

Those are three sections that I have just mentioned.

What amazes me is that members of the Australian Labour Party, who claim to be the champions of the workers and employees, have not raised their voices in any way to protect the interests of workers in superannuation funds to which many of them have contributed for a great many years. On the contrary, the honorable member for Melbourne Ports (Mr. Crean) and other honorable members opposite who have discussed the matter in this House on previous occasions talked about removing the tax advantage in respect of superannuation. I find myself completely at variance with members of the Labour Party on this issue. 1 believe that superannuation provides one of the finest means of financing the development of this country and of providing capital for its growth. By this means the savings of employees are marshalled to provide a substantial sum which, when invested in government bonds or semi-government securities, provides capital for the development of this country. Therefore, I have always advocated incentives for superannuation and given wholehearted support to the Government’s action in providing such incentives. To the best of my recollection, when the present Government took office a tax deduction of only £100 was allowed in respect of insurance and superannuation combined. Since this Government has been in office that incentive has been increased in stages to £400. The country has gained tremendously from this.

Having supported year after year incentives for saving, I now find it quite impossible to support a measure that contains a provision designed to impose a penalty on saving. I am just as strongly in favour as is any other member in this House of action needed to prevent tax avoidance and to make tax avoiders pay what they should pay. What I object to in this Bill is that it will make employees pay for the misdeeds of somebody - whether an employee, an employer or a trustee - who does not comply with the rules laid down by the Commissioner of Taxation. When we come to consider the Income Tax Assessment Bill 1965 I shall deal with this matter at greater length. 1 could not let the present measure pass, however, without placing on record my emphatic protest against a Bill that will impose a penalty on superannuation, which provides capital for the development of this country. Nor can I support a provision that will penalise thrifty employees who provide for their old age. In this House I have consistently supported all forms of superannuation. I have advocated national insurance and national superannuation. After having advocated them all my life and supported superannuation schemes and incentives for superannuation, I cannot now be a party to supporting a Bill that will in effect impose a tax penalty on thrift, especially in respect of the lower paid section of the community.

Dr FORBES:
Minister for the Army and Minister Assisting the Treasurer · Barker · LP

– Mr. Speaker, I do not want to say anything about the points made by the honorable member for Melbourne Ports (Mr. Crean). As I understood him, he was not specifically objecting to the increase of 21 per cent, in rates of personal income tax. The Opposition’s objection to this measure is based on a traditional view of the income tax structure. The Government’s attitude to the Opposition’s view has been stated in this House many times. Therefore I do not believe that in the context of this Bill it is either desirable or appropriate for me to answer in detail the points made by the honorable member. However, I should like to say something about the speech made by my friend, the honorable member for Sturt (Mr. Wilson), who very sincerely has indicated that he opposes the Bill because he objects to the proposed rate of tax of 10s. in the £1 to be levied on superannuation funds that do not meet the tests laid down in the tax laws. The Government understands and comprehends the point made by the honorable gentleman. It understands also the sincerity with which he advances the point of view that he has put to the House so eloquently tonight.

I should like to point out to the honorable member that the proposed amendment of the law will not result in a fund’s being taxed unless it fails to meet reasonable tests that are laid down in the law. This is the important point. One might conclude from what the honorable gentleman has said that this tax rate of 10s. in the £1 will apply to a majority of superannuation funds or even to all of them. The assessment measure passed last year specifically exempts from tax funds meeting the tests that I have just mentioned. The proposed tax rate of 10s. in the £1, which is the subject of the honorable member’s objection, will in practice be payable only by funds that fail to satisfy the tests laid down in the law. He has indicated, quite rightly, that he has been one of the most constant promoters of traditional type superannuation funds over a long period - I think, about the length of my life time, or about 40 years. These traditional type funds to which he has referred will have little, if any, difficulty in meeting the tests laid down so far as they apply to funds organised by employers for the benefit of their employees, for which funds the proposed rate of tax will seldom have any significance. As the honorable gentleman placed all his emphasis on the effect of this proposal on employees, I consider that this is a significant point to make. Where the tests are not satisfied it will not be practicable to relate a tax rate to the incomes of the members of a fund. Accordingly, it is necessary to impose a fixed rate. This is done having in mind that the funds affected are those failing to satisfy the tests.

I emphasise again, with particular reference to funds affecting employees, that very few, if any, will be unable to satisfy the tests. This applies particularly to the traditional type of fund. Since those are the funds that are to be affected, the Government considered that the income accumulated by them should bear the same rate of tax as is payable on the undistributed income of private companies, that is, a rate of 10s. in the £1. A fund which becomes liable to that rate is, of course, entitled to alter its rules and practices so as to qualify for exemption. Therefore, the employees who are members of bona fide funds will not, in practice, be adversely affected by the new proposal. Although the Government sympathises with the point made by the honorable member for Sturt, it cannot accept the objections that he has raised to the measure.

Question put -

That the Bill be now read a second time.

The House divided. (Mr. Speaker - Hon. Sir John McLeay.)

AYES: 52

NOES: 45

Majority . . . . 7

AYES

NOES

Question so resolved in the affirmative.

Bill read a second time.

Third Reading

Leave granted for third reading to be moved forthwith.

Bill (on motion by Dr. Forbes) read a third time.

page 3153

INCOME TAX ASSESSMENT BILL 1965

Second Reading

Debate resumed from 28th October (vide page 2328), on motion by Mr. Harold Holt-

That the Bill be now read a second time.

Mr SPEAKER:

– There being no objection, this course will be followed.

Mr CREAN:
Melbourne Ports

– I am sorry to have to inflict myself on the House again so soon. The major Bil! that we are now considering is the Income Tax Assessment Bill, with which are associated the Income Tax (International Agreements) Bill and the Income Tax (NonResident Dividends) Bill. Whereas the Bill with which we have already dealt related to the rates of tax that would be applied to taxable income, the main one now before us determines what shall and shall not be subject to taxation. As has been pointed out on a number of occasions, the principal Act is becoming a very complex document. In his second reading speech the Treasurer (Mr. Harold Holt) said-

Like most taxation measures, it is in some respects unavoidably complex, but I would point out now that much of its volume is explained by the repeal and re-enactment of a number of rather lengthy sections.

One of the reasons why the income tax legislation contains such lengthy sections is that it is being asked to do many things which income tax legislation ought not to be expected to do. It is being asked to cover certain desirable social objectives which do not come properly within the compass of the provisions of income tax legislation.

I would suggest that the time has arrived to make the legislation better codified than it is. The honorable member for Sturt (Mr. Wilson) gave an example of the need for this when he pointed out that, in developing his argument, it was necessary to go from section 121 back to section 23. There is a case for dividing the Act into separate parts to make it easier to handle or for renumbering the sections. Many of the sections have been amended so often that the letters of the alphabet have been used up and we have got down to Roman numerals. The sections containing the superannuation provisions cover some 40- pages. There is surely a case for attempting to put the Act in better form.

With this measure, as with most taxation measures, an explanatory memorandum has been provided. I thank the officers of the Taxation Branch for the time and skill they devote to trying to make the inexplicable almost explicable. I am afraid that they have not succeeded in many ways so far as I am concerned, but that is probably the fault of the reader rather than of the writer. The memorandum outlines the main changes that are proposed. I find no great objection to any of them because it seems to me that they are on the side of trying to protect the revenue. In the systematic battle between those who want to pay as little tax as possible and a Government which wants to get all the revenue it can, there is great scope for contrivances on the part of accountants, lawyers and others. I said earlier tonight that one reason why the legislation has become so complicated arises from the rates of taxes that are currently payable. I do not suggest that those rates are too high; in many respects, some of them are still too low. As I suggested earlier, there is good ground for recasting the whole structure.

I should like to refer honorable members “ to a very interesting little book entitled “The Uneasy Case for Progressive Taxation “. It is an American publication. The authors are Walter J. Blum and Harry Calven Junior. On page 18 they have something to say which I think is relevant to the Australian circumstance. It is this -

The price the tax system pays for progression is thus high, lt produces a tax law of almost inpenetrable complexity, lt invites a distorting attention to the tax aspects of any economic transaction, lt affords an excessive stimulus to tax avoidance with perhaps incalculable consequences for taxpayer morale and the general respect for law.

Many of the amendments that this House is asked to consider arise from the fact that the spirit of the law intends one thing but somebody thinks that the letter of the law means something else. Endeavours are then made to drive the proverbial coach and horses through what appears to be a mere crack in the law. Sometimes these endeavours are successful, and it is because of this that progressive amendments to the taxation laws are necessary. These amendments are becoming highly complex.

I would not welcome an undue extension of parliamentary committees, but I think sometimes that a case can be made for setting up committees of a special kind. In quite a few of its recent issues the “ Taxpayers Bulletin” - I do not always agree with its point of view although I certainly welcome the information that it contains - has suggested that the Government be urged to establish a statutory committee on taxation review, modelled on the Tariff Board, to advise the Government on all matters relating to taxation. If there were such a committee, I am not sure that it ought to be modelled on the Tariff Board. I think that before any plunge is made in this direction we should consider the matter very carefully. I would commend as an alternative something that is suggested in a booklet which I quoted in this House a month or so ago. It is “The Treasury Under the Tories, 1951-64”, written by Mr. Samuel Brittan, a financial journalist in London. In it he is referring to the procedure in the House of Commons. We model our procedures on those of the House of Commons. To a great extent, our financial machinery is similar to that of the House of Commons, although we give different titles to our Bills and our timetable is somewhat different. In England, the fiscal year ends in March or April. Ours ends in June. On page 109 of this booklet we find this passage -

From March onwards a change comes over the Budget Committee. Most economic decisions have usually been taken-

That is the case here with our Budget - and the Finance Bill-

That is a measure similar to the one we are discussing - which gives legal effect to the Budget looms larger. The Inland Revenue may have ideas for blocking tax avoidance or improving administration; or there may be detailed anomalies to remove. At this stage, Treasury knights and economists are out, and tax lawyers are in. The Law Officers and the Parliamentary Counsel arrive on the scene; most of the Treasury men, including the Permanent Secretary and the Economic Adviser, quietly withdraw. The Chancellor, or another Treasury minister, takes the chair.

That is much the same situation as we have here. When we are discussing the Budget, the Treasury officers are here. When we are discussing tax matters, we have here the Commissioner of Taxation or members of his staff. The Treasury knights and economists are out and the tax lawyers are in. The passage continues -

There is often no close connection between the detailed points of tax law in the finance bill and the main Budget decisions about income tax, profits tax and all the rest. There is thus a strong case for an annual finance bill confined to the major Budget decisions and a separate tax management bill which the House of Commons might consider in Standing Committee upstairs and which would not have to be an annual event. Such separation would be controversial but it might help to reduce the amount of time taken up by the finance bill on the floor of the House of Commons, which is now the chief item of business from April to July.

I suggest there is a thought in that quotation. After all most of the measures before us in these tax bills are not controversial, They are matters for differences of opinion about their technical application rather than the effect they may have on the revenue. They are becoming increasingly more complicated, and I compliment the income tax officers for trying to make these documents, and therefore the legislation we are passing, understandable, but I still think that many of the measures that we discuss, aud the way in which they are put before us, are not easy for the ordinary layman in this Parliament to contemplate. I would suggest there is a case for a committee of some kind. It should be reasonably small, but representative of the House. It could examine officers from the Taxation Branch and persons from outside the Branch who feel aggrieved by the impact of the law. Many of these amendments need to be made not hastily but tranquilly and they should be submitted to the House with memoranda or reports that members could read more easily than the present document. At least on this occasion we have not had the same haste with this measure as we had with a similar measure last year which aroused much discussion because complicated amendments were laid on the table of the House one Thursday and members were expected to debate them the following Tuesday or Wednesday. Persons outside who were likely to be affected by the proposals had no chance to see them, and it was altogether a most unsatisfactory way of doing business. On this occasion the Treasurer has given us almost a month in which to consider these amendments. I do not think there has been the same discussion about them this time because in many ways they modify what was done hastily last time.

The Treasurer said that this measure repeals and re-enacts a number of rather lengthy sections and corrects some of the provisions that were passed hastily last year. There are one or two matters at which I should like to look. I am fortified in my remarks to some extent by comments in the “ Taxpayers’ Bulletin “. My remarks relate mainly to the question of superannuation funds. I do not go along the road that the honorable member for Sturt (Mr. Wilson) traversed a few moments ago regarding penalising honest working men by reason of the impost of 10s. in the £1 in certain circumstances. I agree with the Minister that not many companies fall within this particular category. Most of the funds are non-taxable. Perhaps the Minister might look at the statistics contained in the 44th report of the Commissioner of Taxation relating to superannuation funds. They show that 8,627 funds lodge returns with the Taxation Branch. A number of funds reside in the custody of insurance companies, but of the 8,627 funds only 526 are fully taxable, 1,508 partly taxable and 6,593 do not pay any tax at all.

Mr Wilson:

– There was not any provision for them to pay any tax.

Mr CREAN:

– No, but all I am suggesting is that some organisations try to get around the law, and in my view the law has a perfect right to defend itself in those circumstances. The ramifications of these funds are becoming so complex that I doubt whether it ought to be left in the hands of the Commissioner of Taxation to adjudicate on them. He has far too many other important duties to perform than to be tied up with determining whether certain of these devices are legitimate or otherwise. In the “Taxpayers’ Bulletin” of 16th January 1965 is a paper by a very capable writer on taxation, Mr. McKellar White. At the end of his paper was a panel discussion. One of the people who took part in that discussion was Mr. D. O. Parsons who has some association with a body known as the Association of Superannuation and Provident Funds of Australia. He said that the half million persons contributing to private funds are represented by a certain number of funds. The honorable member for Sturt and I referred to these half million people last night. Mr. Parsons said that the number of private funds in Australia is unknown, but estimates range from 40,000 to 70,000. Something is wrong when we do not know the number of funds. It could be somewhere between 40,000 and 70,000 - either number is large enough - but the margin of difference is too great to be ignored. He said -

Let us say there are 50,000 funds in Australia. Of this 50,000 funds the great majority - .probably 95 per cent, of them - cover funds which have a membership of less than 250 contributors, but the other 5 per cent, of the funds account for at least 90 per cent, of the members of all the funds and 90 per cent, of the assets. For example, the 200-odd funds that are members of the Association of Superannuation and Provident Funds of Australia represent nearly a quarter of a million contributors and approximately £300 million in assets.

All I am suggesting is that surely we ought to know how many funds there are in Australia. It has been suggested that there ought to be a registrar of superannuation funds where each of those funds should have to file certain documents. I should think it is important to know how many people belong to these funds. I draw attention to some of the observations ‘ made by the Insurance Commissioner in’ his latest report about unsatisfactory features in the control of these funds. In his report for the year ended 31st December 1964 he said -

The forfeiture rate for superannuation business has little significance as the provisions of most superannuation schemes allow payment of a surrender value on the termination of a policy at very early durations. I have previously referred to the substantial volume of surrenders of Superannuation policies and have stated the principal reasons -

He then lists the reasons. The second and third reasons are the significant ones -

  1. the practice referred to above of paying surrender values irrespective of the duration of the policy.
  2. the frequent absence of any provision in the rules of one superannuation scheme for the acceptance of life insurance policies issued for the purposes of another superannuation scheme.

In other words he makes the point that a person belonging to a scheme catering for 20 or 30 people who wishes to leave his employer should be able to transfer his equity in the scheme to the scheme operated by another employer. I would direct the attention of those who may be interested to a comment in the “ Economist “ of 24th July 1965. An article in a special supplement of that issue entitled “ Alternatives for Pension Rights “ reads -

One possibility is that all vested pensions should be paid over to a central fund-

That is, when a person leaves one employer there should be somebody to whom his rights could be transferred - which itself would undertake to maintain the purchasing power of these pensions by increasing them in line with the cost of living. But merely maintaining the real value of a vested pension will not meet the objective of relating it to ultimate final salary.

The point here is that there are some difficulties with respect to mobility of labour. Some of the virtues that people see in superannuation schemes can also be deleterious in their effect if the longer a person is with a firm the more reluctant he is to change his employment, even though it may be beneficial to himself and to the community that he should change. The final point noted by the Insurance Commissioner is -

  1. the probability that the rules of some schemes, which include occupations subject to a high rate of labour turnover, may not have sufficient regard for the circumstances of those occupations.

In some industries the labour turnover is relatively high. It may be that the equity of a person who joins those sorts of funds should be protected. Part of the amendment that we have before us deals with benefits foregone or what happens in a fund when a contributor leaves it. Apparently in some funds all that happens is that the contributor is refunded the amount of his contributions. Whatever his contributions may have earned goes to the benefit of other members of the fund. I doubt whether that is an equitable way of meeting the problem. I can agree to some extent with the honorable member for Sturt (Mr. Wilson) that there are some virtues in superannuation schemes, but there can also be disabilities. The more the funds grow in size the more it is necessary to have the kinds of public protections that exist in life insurance generally and in the

Commonwealth Superannuation Board. Surely a fund should not receive a tax concession without some qualifications. What those qualifications should be is not an easy matter for people such as honorable members of this House to determine.

Various matters arise, such as the practice of people trying to pay into the funds on behalf of other people more than they should pay. I read in the Press the other day of some gentleman who was trying to have a payment of £100,000 made to him by a company for services rendered over a number of years. He may have regarded his claim as legitimate but as the matter was reported in the Press I doubt whether anybody else thought it was anything more ;han an attempt at gross extortion. Much the same sort of thing has happened in Great Britain and to some extent, until the law was modified, in Australia. I refer to what were called top hat schemes where people in private companies or one man companies were paying themselves, at the expense of the revenue, inordinate retirement allowances. Half of the allowance was virtually being subsidised by the Commonwealth by reason of the fact that each £1 allowed as a deduction to the company cost the Commonwealth about 8s. 6d. in revenue. Surely this was a case for public intervention. Apparently, at the moment, the only intervention that is possible is by the Commissioner of Taxation. I know that much is made of the discretionary power of the Commissioner but if outside people were to adopt another approach to these things perhaps the discretionary power of the Commissioner would never need to be invoked. The sort of things we are asking the income tax structure to bear these days make it more and more difficult to legislate with finality about some of the matters. I cannot see any alternative than in some instances to have a discretionary power vested in the Commissioner of Taxation. I suggest that because in many respects the compass of what the Commissioner is being asked to do is so great, the discretionary power should be exercised by one of his deputies rather than have the Commissioner individually oversee all cases. All this shows how difficult the process of legislation can become.

I do not wish to say much more. We support most of the proposals in this Bill.

Some of my colleagues wish to raise matters relating to particular items in the structure of taxation at the moment. Some, for instance, wish to refer to the zone allowance. But by and large we support the measures because they seem to be designed to rectify injustices that we think exist and to correct anomalies. Also, they close some of the loopholes that have been found. In an article on 27th February 1965, which was not long after the amendments to the legislation last year, the “Taxpayers’ Bulletin “ under the heading “ Trafficking in Loss Companies “ stated -

Strangely enough, these amendments have given a spurt to trafficking in loss companies as will be seen by heavy advertising in the financial pages of the daily press. It seems that, providing losses can be absorbed before June 30, 1965, the amendments give an imprint of respectability to this type of activity.

I doubt whether the law intended to give an imprint of respectability to this type of activity. The people who gave this type of activity any possibility of success were the clever lawyers to whom certain people went for advice. Some doubts were raised as to the effective commencing date of the amendments in relation to the acquisition of a loss company and the following question was submitted to Queen’s Counsel -

If a loss company is now acquired (under procedures that would have been effective under the old law) will that company be assessed for the income year ending June 30, 1965, as if the present amendments had not been made?

Counsel replied -

I answer this question - “ yes “. The reason why this is so is that Clause 45 (1) (so far as material) provides that ‘ The amendments made by sections - twelve to eighteen (inclusive) apply to assessments in respect of income of the year of incomes that commences on the first day of July, One thousand nine hundred and sixty-five, and in respect of income of all subsequent years of income*. This, thought it could perhaps have been more clearly expressed, effectively precludes the application of the amendments to any year prior to the year of income commencing 1st July 1965.

All that that conveys to me is that often in this House we really do not know what we are doing. That is a very serious statement to have to make in a parliament. As far as I can see, we will not know what we are doing until we alter the way in which we deal with these tax bills. I can see that a question such as, for instance, what the rate of tax ought to be is a matter of policy, but the sort of matters I am referring to are not matters on which we really disagree. We want to do a certain thing, we think we are doing it, and then we find that in fact it has not been done because the law has not been carefully drawn or because someone outside is cleverer than we thought he was. On none of these bases is the position satisfactory. I suggest that the Treasurer (Mr. Harold Holt) give serious consideration to this suggestion. As I say, I do not endorse it precisely in the form in which it has been made. As to the sort of body there ought to be, how it should be constituted or the kind of work that should be assigned to it, I would not presume at the moment to comment. We can all agree that an existing state of affairs is unsatisfactory but we might not always agree as to what the solution ought to be. At least this suggestion is worthy of consideration.

I have these memorandums before me. As I have already said two or three times this evening, I do my best to comprehend them and I get assistance by going to such sources as Gunn or Butterworth or other such volumes, but even then I do not find the task easy. Of course, taxation bills are not the only bills that we in this Parliament have to consider during a session but there are times in the year when we are not as busy as we are at other times and when a committee could perhaps meet for several days at a time. We could then indicate in broad outline what we thought we wanted to do. We could consider the sort of representations that the honorable member for Sturt (Mr. Wilson) has made this evening about superannuation funds. I think he and I might get on better sitting at a round table with somebody between us than by trying to argue the matter across this chamber - although I must say I thought this evening that for once he was going to vote with me. However, he did not afford me the pleasure of seeing him do so. I do not agree with him in his interpretation; I may be wrong or he may be wrong. However, both of us would be better enlightened if we had access sometimes to some other kind of machinery for considering a measure of this kind.

Mr Cleaver:

– Does the honorable member think a standing review committee would help?

Mr CREAN:

– The Treasurer (Mr. Harold Holt) put a question of that kind to me a few weeks ago and I said I would not like to be precise. 1 would like to see some scheme formulated, or some informal discussion held about it. I think the present machinery is unsatisfactory. In a Parliament various members have to specialise, and we sometimes do not worry very much about measures that are not in our particular fields. But I doubt that the people who are interested in the intricacies of this legislation can really be very satisfied with the way things are done. I said here probably 12 months ago, during a debate on a similar matter, that I had to confess 1 just did not know what certain of the sections of the legislation meant. 1 am sure that if I did not know I was in good company, although I concede that there may have been someone who did know. These Bills are not quite as complicated as the one we were considering then. I think that what is being done now is a recognition that we all made mistakes on the last occasion. At least some of them are being corrected on this occasion.

Mr BOWEN:
Parramatta

.- I support the three Bills before the House. The Income Tax (International Agreements) Bill and the Income Tax (Non-resident Dividends) Bill make minor amendments only to existing Acts and I do not propose to say anything about them. However, the Income Tax Assessment Bill does make amendments of some importance to the principal assessment act.

The first amendment that it makes is to change the name of the principal Act, which had the rather unwieldy title of the Income Tax and Social Services Contribution Assessment Act 1936-1965. Although the reference to social services contribution did have some point when it was first introduced, it has been pointless since about 1950, and I think all would approve of the change in the title to the simpler form of Income Tax Assessment Act. The other amendments fall into two categories, first, those which change the amending provisions which were inserted in November 1964, and secondly, those which insert new provisions in the Act - provisions which we have not seen before. Perhaps I may deal first with those which change the 1964 provisions. I come then to two sets of amendments, those relating to superannua tion funds - which appear in this Bill in clauses 5, 9, 17 and 23 - and those which deal with the carrying forward of losses, which appear in clauses 19, 20 and 21. The provision which deals with superannuation funds for employees was, in the principal Act, section 23f. By clause 9 of this Bill the old section 23f is repealed and a new one inserted. If one looks at the amendment proposed in the new provision, one finds that it is very small. It is mainly a repetition of the old provision. I think honorable members will recall the structure of that provision. Up to the point of time when it was inserted in the Act superannuation funds established for the benefit of employees, which were being maintained for the purpose for which they had been established, had their incomes exempt from tax. The effect of section 23 f, inserted in November 1964, was to impose a penal rate of 10s. in the £1 on the income of those funds unless they passed a series of nine tests. These nine tests were set out in paragraphs in sub-section (2.). One of the points of criticism of the 1964 provision was that there were very few superannuation funds in Australia which could pass these tests. It was provided in the section that if a fund did not succeed in passing the tests the Commissioner had a discretion, in special circumstances, to treat it as if it had. That provided some flexibility, but it was a point of criticism that the tests should not have been so stringent that ordinary and genuine superannuation funds could not pass them.

The Government, in bringing down this amending Bill, has recognised that one in particular of these tests was too stringent, because it has modified it. I refer to the test that appeared in paragraph (f). It was a test which required the fund to show that where members of the fund had ceased to have an interest in it during the year - maybe they had left their employment - their benefits had to be allocated amongst the members who remained in the fund. Let me just take a practical example. If a business with an Australia-wide staff of employees numbering say 8,000 had a turnover in its employment of 600 a year, as each one of those 600 employees ceased to belong to the superannuation fund it was necessary to make a calculation and to distribute his benefit among the 8,000. If you multiply 600 by 8,000 you get the number for calculations which had to be made because of the requirements of this provision. The Government has lessened the force of that condition in this amending Bill by providing that the condition laid down in the paragraph might be fulfilled by the giving of an undertaking to the satisfaction of the Commissioner that the fund would make an allocation of these benefits.

It might be convenient at this point to to mention that if a fund did not allocate the benefits of members going out, then the employer - perhaps a company - who in the past had obtained a tax deduction for their contributions had to go back over those past payments and get that deduction reduced. This was provided for by section 82AAG of the Act. This also required a multiplicity of calculations. Section 82AAG. of the Act is worth reading as an exercise in draftsmanship. One can get a good deal of humour from reading it. The calculation itself was calculated to bring a furrow to the brow of any actuary.

The Government has recognised the difficulty it was imposing on genuine funds as a result of that old provision, and it proposes to insert a new section 82AAG which will permit an employer who has made contributions which have not been distributed to reach an agreement with the Commissioner of Taxation as to the manner in which the deductions will be adjusted. It will be seen that the old section 82AAG is to be reproduced as section 82aah, but it will now be only a Sword of Damocles, and that if an employer reaches agreement with the Commissioner it will not be necessary to apply this latter section.

The Government members Committee on Taxation and Finance had a look at ah provisions of section 23F after this Bill had been introduced into this House. It appeared to the Committee, which consists of 16 Government supporters from this House and the other place, that further alteration of some of these conditions was required. It will be appreciated that superannuation funds, as has been mentioned, are funds in which a substantial part of the work force in this country is interested. Anything which imposes a harsh burden upon genuine funds is hitting only that section of the work force. It appeared to the Government Members Taxation and Finance Committee that in particular two other conditions were too difficult for genuine funds to comply with. These were the conditions in paragraph (b) of sub-section (2.) and in paragraph (h). Certain recommendations have been made for the amendment of paragraph (b) which requires the trustees of the fund to show that an employer had contributed to the fund in the year of income in respect of every employee. Where an employer has a large number of employees with some perhaps coming in during the month of June and others going out perhaps in the month of July, it would be very easy to miss making a contribution during the year of income in respect of some employees. Under the Act as it stands this would be a breach of the condition and would attract a tax of 10s. in the £1 to the whole of the income of the superannuation fund. I wish to foreshadow an amendment that I will move during the Committee stage. It will seek to eliminate the words “ in respect of that employee “ in paragraph (b).

As far as paragraph (h) is concerned it is provided in the Bill before the House at the moment that if the benefits which any employee may receive are excessive having regard to a number of factors, including benefits which may be provided from any other fund, then the income of the fund will lose its exemption and be taxed at the rate of 10s. in the £1. If the trustees have a large number of employees in a fund, it would need only one employee to be a member of another fund and for the aggregate of his benefits to be excessive for the final rate of tax to be attracted to the whole of the income of the fund. It might be a matter which was not known to the trustees or to the other employees. It is considered that this is a fairly harsh condition. I foreshadow bringing forward at the Committee stage an amendment to the effect that only other section 23f funds will be taken into account in aggregating the benefit to employees. That is to say the employer will take into account only other funds which are employer-employee funds. Not many employees have more than one employer, so this fact would generally be known and there would not be an accidental loss of exemption as there could be under the present provision.

There are a number of other provisions which require alteration. I shall be bringing forward other amendments in the Committee stage. One will be an amendment to paragraph (e) which has to do with the obligation to communicate in writing to an employee notice of his right under the fund. If you look at that provision, Sir, you will see that it does not provide an adequate specification of the time within which existing funds must comply with this requirement. It needs amendment in that respect. In addition, it seems that it should be sufficient if notice of the existence of the right, that is notice of the membership of the fund, is made available to each employee without necessarily requiring notice of the terms and conditions giving rise to his right to be communicated. I foreshadow an amendment along these lines.

There is a definition of when a member ceases to have an interest in a fund. This appears in clause 5 which inserts new section 6a. It will be noticed that a member ceases to have an interest in a fund at any particular time if by virtue of the terms and conditions applicable to the fund his right to an amount that has accrued ceases at that time otherwise than by payment of that amount to the person. There is the circumstance where an employee transfers to other employment and his benefit is transferred to another fund, where he ceases to have an interest in the fund because of his transfer. It is not right that it should be treated as forfeiture of his right because his benefit is preserved and transferred to another fund. I foreshadow an amendment to the proposed section to take care of that situation.

In addition to a number of minor amendments which I will be bringing forward, I foreshadow one other amendment of some substance. This is in respect of proposed new section 23F in clause 9 and relates to discretion. It will be noticed in sub-section (2.) of the proposed new section that it is not a question of whether in fact the trustees fulfil these conditions. The test is whether the Commissioner is satisfied that the trustees do so. In other words, it depends upon what is the opinion of the Commissioner on the matter, not upon what the fact is. I shall be bringing forward an amendment to delete the reference to the satisfaction of the Commissioner so that it will depend upon the fact. This might be thought to be making in one way the provisions somewhat tighter.

That is not really so. I call attention to the fact that proposed new sub-section (6.) of that provision allows the Commissioner to treat the trustees as if they had complied in special circumstances in his discretion. This discretion will still remain to cover the case where the Commissioner sees there is failure to comply which he thinks, in effect, should be excused. It is not suggested that that discretion, which is in favour of the superannuation fund, should be removed. One advantage which will accrue to trustees of superannuation funds from the deletion that I have suggested is that they will have then the option of going to a Supreme Court, the High Court of Australia or to the Taxation Board of Review to test whether the Commissioner is assessing them correctly when he asserts that they have not complied with the conditions.

In making these suggestions - I do so as Chairman of the committee - I should say that they are the views of the committee. I should mention also that the committee has adopted the principle that it should try to make suggestions to remove features which bear with undue hardship on genuine superannuation funds, but that it should not in any way widen ‘the mesh of the net which is designed to catch any person who is using a superannuation fund to evade the provisions of the particular taxation act concerned. In suggesting these amendments, our committee has had the benefit of conferring with senior officers of the Taxation Branch. In the case of one or two suggestions which we have made, it has been pointed out that there could be some risk that the mesh would be widened, if those suggestions were adopted. Our practice has been either to withdraw or modify the suggestion concerned so that there would not be the risk of the mesh being widened as a result of the suggestion being adopted. The amendments suggested are simply to remove difficulties for the genuine superannuation fund.

There are other superannuation fund provisions. Clause 17, in which new section 79 is proposed, deals with another type of superannuation fund. Without going into detail during this second reading debate, I mention that somewhat similar amendments to some of those provisions will be required. I foreshadow bringing those amendments forward in Committee. The other provision which deals with superannuation is, as I mentioned, clause 23. Already the Government has made an amendment to that clause which mitigates the difficulty of excessive calculation being required in respect of deductions. I support the amendment which is contained in this Bill. However, it is possible that experience will show the need for further amendment of these rather difficult provisions. It is necessary that some further review of them should be undertaken.

Mr. Speaker, I come now to the question of losses. The provisions with regard to losses are contained in clauses 19, 20 and 21 of the Bill. The main amendment which is introduced by this Bill is a provision which gives an alternative method of claiming the carry forward of losses where a change in shareholding takes place. Honorable members no doubt will be familiar with the fact that if one wishes to carry forward losses under section 80 of the principal Act, there has to be a specified continuity in beneficial ownership of the shares to permit that to be done. The alternative which is provided by this amending Bill is that if the company at all times during the year of income during which the deduction may be claimed is carrying on the same business as it carried on immediately prior to the change in its shareholdings, it will be entitled, notwithstanding the change of its shareholdings, to carry losses forward. Continuity of business is added as an alternative to continuity of shareholding as a ground for being able to carry losses forward. I would support that amendment.

One comment I would make on the loss provisions is that those provisions which relate to the shareholding are amended to make them somewhat more specific than they were in the principal Act. These, by virtue of clause 42 (3.) of the Bill, will come into operation retrospectively from the 1st July 1965. I think some attention needs to be given to the fact that some people will have been acting upon the existing law relating to the shareholding provisions for the carry forward of losses and that to amend this provision retrospectively will upset a certain number of transactions which have been entered into on the basis of the old law. My suggestion is that it would be preferable to make that particular change run from the 1st January 1966. I do not suggest any change in the continuity of business amendment, which is an advantage. I have heard the suggestion that it should be made to relate back to an even earlier date.

The other class of amendment consists of those which are new and have not appeared in the principal Act before. There would be little debate about the desirability of many of them. Clause 8 provides an exemption of the pay and allowances of members of the Defence Forces serving in Vietnam and Borneo. Clause 7 exempts the pay and allowances of members of the Citizen Forces and members of the Emergency Reserve Forces performing part time duty. There are other provisions which I think would not be the subject of serious debate. Perhaps I should mention the benefits to wool growers which the Government offers as some mitigation of difficulties arising from drought conditions. Where shearing has taken place and a wool cheque has been received early, thereby producing two receipts in the same year, clause 11 provides that there may be a carry forward of that income into the next year. This will spread the incidence of tax and give some relief from the effects of drought.

Pioneer industries in the Territory of Papua and New Guinea have been given a benefit in relation to the exemption of their incomes. Clause 14 exempts dividends paid by such companies out of that income. Clause 13 provides an amendment to catch a certain type of transaction which took advantage of the exemption formerly applied to the issue of bonus shares. If bonus shares were issued out of profit arising from the revaluation of assets or the sale of assets or from a share premium reserve, they were tax free in the hands of the shareholders. It appears that some people had issued redeemable preference shares or taken other steps so that these shares could be converted into cash shortly after their issue. A cash dividend would be taxable, but the bonus shares were not. This clause picks up the issue of bonus shares which show all the indicia of being designed to provide cash and makes them taxable. Such shares will lose the exemption.

Another provision of the Bill makes allowance for expenses incurred on the changeover to decimal currency. In particular there are provisions relating to the cost of converting plant to deal with decimal currency. A member of the Government Members’ Taxation and Finance Committee, the honorable member for Henty (Mr. Fox), will bring forward an amendment in respect of that provision. At the moment, where compensation is paid, it is simply written off the cost of the plant and depreciation thereafter is taken on the lower figure, but the expenditure on the plant is treated as capital expenditure. The purpose of the amendment will be to give an allowance, as a deduction, for the expenditure on the plant, even where no compensation is paid and the expenditure is simply to change to decimal currency signs the normal signs on cash registers and so on.

Other provisions in the principal Act which were inserted in November 1964 are not touched by this amending Bill. I have in mind particularly provisions relating to trusts, partnerships and leases. There are certain features of these provisions which are subject, I think properly, to some criticism. I would suggest that a review of these provisions, as well as those relating to superannuation funds, would be desirable in the autumn session of the Parliament. I would, as it were, like to put on a caveat in that respect.

Debate (on motion by Mr. Collard) adjourned.

page 3162

BILLS RETURNED FROM THE SENATE

The following Bills were returned from the Senate -

Without requests -

Tobacco Charge Bill (No. 1) 1965.

Without amendment -

Tobacco Marketing Bill 1965.

Tobacco Industry Bill 1965.

States Grants Bill 1965.

House adjourned at 11.16 p.m.

page 3163

ANSWERS TO QUESTIONS UPON NOTICE

The following answers to questions upon notice were circulated -

Unidentified Flying Objects. (Question No. 1367.)

Mr L R Johnson:

son asked the Minister for Air, upon notice -

  1. What records are kept regarding reported sightings of flying saucers and other unidentified flying objects?
  2. Does the Royal Australian Air Force or any other governmental authority investigate reported sightings; if so, how many sightings have been investigated over each of the last five years?
  3. Have R.A.A.F. personnel or civil aviation personnel reported sightings over the last five years; if so, what are the details?
  4. Does Australia consult with other countries regarding the sighting of unidentified flying object’s?
  5. If so, when and where have the conferences been held, what countries have been involved in the discussions, and what findings have resulted?
  6. From evidence available, is it reasonable to speculate that some unidentified flying objects originate from other (a) countries or (b) planets?
Mr Howson:
Minister for Air · FAWKNER, VICTORIA · LP

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

  1. Persons reporting unusual aerial sightings complete a form entitled “Report on Aerial Object Observed “. If possible this report is completed in the presence of a R.A.A.F. officer in order that the best possible information can be obtained. After examination and evaluation, these reports are filed in the Department of Air.
  2. Yes, the R.A.A.F. Sightings reported and examined since 1960 are -

The increase in 1965 can be explained by a spate of reports from Tasmania and Papua and New Guinea arising from a flurry of public interest.

  1. Yes. Fifteen reports of unidentified flying objects have been submitted by R.A.A.F. or civil aviation personnel from 1960 to September 1965. The majority of these were assessed as being caused by meteors.
  2. Yes.
  3. Consultations occur with other countries as necessary in relation to the examination of these reports. My department receives advice from other countries about their investigations of unidentified flying objects through its overseas offices.
  4. No.

Aerodrome Improvement in Western Australia. (Question No. 1448.)

Mr Collard:
KALGOORLIE, WESTERN AUSTRALIA

d asked the Minister representing the Minister for Civil Aviation, upon notice -

  1. At which aerodromes in Western Australia are improvements to be carried out during this financial year?
  2. What are the improvements, and what is the estimated cost in each case?
Mr Fairbairn:
Minister for National Development · FARRER, NEW SOUTH WALES · LP

– The Minister for Civil Aviation has supplied the following information -

Work will be carried out at the following places in Western Australia -

Since many of the individual items will be the subject of tendering, it would be inappropriate to disclose the individual estimates.

It will be seen that the total estimate of the proposed works to be carried out in Western Australia during this financial year is £961,000.

Melbourne Telephone Directory. (Question No. 1462.)

Mr Courtnay:
DAREBIN, VICTORIA

y asked the Postmaster-

General, upon notice -

  1. Is it a fact that the Melbourne Pink Pages telephone directory is being used for the purpose of advertising suspect television repair concerns in a manner contrary to regulations?
  2. Can he say whether some of these concerns have been subjected to investigation by the Victorian police authorities, and are similar facilities also being provided for doubtful motor driving schools?
  3. Can these matters be dealt with in the same manner as the facilities for starting price bookmakers were dealt with at the instance of the Victorian Government?
Mr Hulme:
LP

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

  1. The Department is not aware of any such use of Pink Pages telephone directories. As a safeguard against such happenings it is the policy not to permit directory entries or advertisements featuring business names which have not been registered as a legal name under the appropriate Act in the State concerned.
  2. The Department has no knowledge of any investigations by the Victorian Police authorities regarding suspect television repair firms. The answer to 1. also applies to the part of this question referring to doubtful motor driving schools.
  3. The insertion of advertising matter in telephone directories is governed by rules designed to safeguard the interests of both advertisers end directory users. These rules are being continually reviewed in the light of changing conditions. In view of this, I consider the course of action suggested is not warranted.

Pensioner Medical Service. (Question No. 1463.)

Mr Webb:
STIRLING, WESTERN AUSTRALIA

b asked the Minister for Health, upon notice -

Will he consider providing surgical appliances, such as corsets, free to pensioners when they are deemed to be essential by a medical adviser?

Mr Swartz:
LP

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

Persons enrolled in the Pensioner Medical Service, and their dependants, are entitled to receive a free medical service of a general practitioner nature, such as that normally provided by a doctor in his surgery or in the patient’s home. Free hospitalisation in the public wards of public hospitals is also available to them, and they receive, free of charge, a comprehensive range of drugs and medicinal preparations.

The Pensioner Medical Service is constantly under review with the aim of making improvements. The amendments to the Service provided for in legislation recently passed by the House will cost an estimated £2,000,000 per annum, raising the total annual expenditure on health benefits in respect of pensioners to over £26,000,000.

Careful consideration has been given on a number of occasions to extending the Pensioner Medical Service to cover items such as surgical appliances, dentures, hearing aids and other artificial aids, but it has not been found possible to do so up to the present.

Exports to Soviet Bloc Countries. (Question 1352.)

Mr Daly:
GRAYNDLER, NEW SOUTH WALES

y asked the Minister representing the Minister for Customs and Excise, upon notice -

What was the (a) value and (b) type of goods exported to each “ Iron Curtain “ country in each of the last five years?

Mr Bury:
Minister for Housing · WENTWORTH, NEW SOUTH WALES · LP

– The Minister for Customs and Excise has furnished the following answers to the honorable member’s question -

Details of exports to Soviet Bloc countries for the years 1960-61 to 1964-65 are contained in Appendix “ A “. These figures have been supplied by the Commonwealth Statistician.

Vietnam. (Question No. 1469.)

Mr Clyde Cameron:
HINDMARSH, SOUTH AUSTRALIA

n asked the Minister for External Affairs, upon notice -

  1. Can he say whether the Government of South Vietnam grants legal recognition to any form of official non-communist opposition political party?
  2. What was the date of the last free election held in South Vietnam?
  3. When is the next general election due to be held?
Mr Hasluck:
LP

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

  1. Legal political parties exist in South Vietnam, and support or oppose the Government on various issues. The present governmental framework is not based on the party system, lt would therefore be inappropriate to speak of official government or opposition parties. The Government of the Republic of Vietnam seeks to take account of the views of a variety of bodies with differing political, religious and social interests.
  2. Elections were held for provincial and municipal councils in South Vietnam on 30th May 1965.
  3. No date ‘ for the next general election has yet been decided.

Vietnam. (Question No. 1471.)

Mr Clyde Cameron:

n asked the Minister for External Affairs, upon notice -

Does the Government recognize North Vietnam and South Vietnam as two separate countries?

Mr Hasluck:
LP

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

There are as a result of the 1954 Geneva Agreement on Vietnam, two territorial entities in Vietnam with separate authorities in each. (See Answer to Question No. 926. “ Hansard “ P. 1364.)

Cite as: Australia, House of Representatives, Debates, 24 November 1965, viewed 22 October 2017, <http://historichansard.net/hofreps/1965/19651124_reps_25_hor49/>.

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