House of Representatives
24 August 1966

25th Parliament · 1st Session

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

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Social Services

Mr. GRAY presented a petition from certain Queensland pensioners praying that the Parliament give immediate consideration to the question of increasing pensions to a minimum of not less than 50 per cent, of the basic wage.

Petition received and read.

Broadcasting and Television

Sir KEITH WILSON presented a petition from certain Australian women praying that the House will act to ensure that the Australian Broadcasting Control Board uses the power vested in it to maintain high radio and television standards and that programmes provide good, clean entertainment for the whole family, with more emphasis on educational and spiritual values.

Petition received and read.

Social Services

Mr. MORTIMER presented a petition from certain electors of the Commonwealth praying that the Government implement Article 25 of the Universal Declaration of Human Rights by providing increased social services and housing benefits for the aged, the invalid, the widowed and their dependants.

Petition received and read.

Similar petitions were presented by Mr. Courtnay and Mr. O’Connor.

Petitions severally received.

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– I ask the Minister for

National Development a question. Was there last year and for the early portion of this year an agreement between the State Governments and the Commonwealth Government setting out the conditions under which offshore drilling leases would operate? Was there a conference between the Commonwealth Government and the State Premiers during this year at which modifications of the agreement were made in favour of the holders of offshore drilling leases?

Did the Minister undertake that during this year legislation would be introduced into this Parliament to ratify the agreements, and does the Government intend to honour that undertaking?

Minister for National Development · FARRER, NEW SOUTH WALES · LP

– There has been and there is still agreement between the States and the Commonwealth on conditions of offshore oil drilling. The primary and basic reason for this was to produce a system under which there would be no legal testing of the question whether offshore oil was owned by the States or by the Commonwealth, which in other parts of the world, particularly the United States of America, has led to a tremendous amount of litigation, with billions of dollars being held in escrow. Unfortunately the amount of work to be done by the draftsmen - and this work is being done by both Commonwealth and State draftsmen - has been so great that it is highly unlikely that we will be able to introduce legislation in the relatively short period ahead of us in this session. However, we believe that it will be introduced in the autumn. It is correct that some minor modifications were made at a meeting held in June between State and Commonwealth Ministers. Under those modifications, five blocks instead of four will remain to the offshore oil drillers after discovery of oil or gas. But the modifications were small and it was felt that, in view of the enormous amount of money that must be expended in drilling for oil offshore, they would encourage more people to enter this very expensive business.

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– Has the Minister for Air noticed reports in this morning’s Press which quote the Auditor-General’s Report and refer to increased costs of the F111 project? Is such increase in costs correct? Does the increase represent increased production costs or the costs of modifications to the F111 as ordered for the Royal Australian Air Force?

Minister Assisting the Treasurer · FAWKNER, VICTORIA · LP

– The item referred to by the honorable member for Angas, I think, is an amount of about $2.6 million which is in addition to the amounts I previously announced in the House. It is related to certain modifications and improvements which came about during the recess and

I think the House will be interested in learning about them. Briefly, the company concerned - the General Dynamics Corporation - informed us during the recess that it had devised two new modifications which will further improve the performance of this already remarkable aircraft. The first one related to extensions to the wing tips to improve the aircraft’s lift performance and so improve its range. The second related to a strengthened undercarriage which enables the aircraft to carry more fuel with a full bomb load, or alternatively, with a full fuel load, to carry a greater volume or weight of bombs.

Mr Beaton:

– When was the Minister advised of this?


– I was advised of this in June.

Mr Beaton:

– Why did the Minister not say this last week?


– Order!


– Usually the House likes me to let these things be known by mentioning them in the House and not outside it.

Mr Beaton:

– But there were questions on this last week.


– Not on this matter. Let me say that the improvement that has come about is that, for an increase of 1 per cent, in the cost of the project, we will get an increase in performance, in range or bomb load capacity, of about 8 to 9 per cent. We considered this to be good economics, and therefore agreed to the modifications being incorporated, because in the environment of Australia increased range is of tremendous importance in this sort of aircraft.

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Mr Allan Fraser:

– I ask the Prime Minister: In view of the statement of the British Prime Minister, Mr. Wilson, to the contrary, will he now clarify whether the American Government did, in fact, inform the Australian Government in advance of the decision to bomb the Hanoi and Haiphong oil facilities? Was the British Prime Minister stating the fact in the House of Commons the other day when he answered Sir Alec Douglas-Home? Sir Alec asked him -

Will the Prime Minister reveal the explanation he gave Mr. Holt of why he did not consult him before dissociating himself from the American action?

That is, of bombing Hanoi and Haiphong. Mr. Wilson replied -

At the time we were told the Australian Government had not been told of this particular bombing. We were told in the strictest confidence.

If the British Prime Minister’s statement is not factual, will the Prime Minister state definitely that the United States did, in fact, consult the Australian Government before the proposal was put into effect? If this was done with the prior approval of the Australian Government, why was the British Government told that we had not been informed?

Mr James:

– Get out of that one.

Prime Minister · HIGGINS, VICTORIA · LP

– Get out of it? I am trying to understand it. I know quite clearly in my own mind where we stood and the position as discussed with us. Before I left Australia to go overseas, I had discussions with my own colleagues about this development. Matters of this sort concerning possibilities of military action are of course canvassed between governments over a period ahead of the possible event. The Australian Government has at all times been in the closest contact with the Government of the United States. I was in a position when I went to the United States to indicate the attitude of the Australian Government to this operation.

Mr Calwell:

– Was the Prime Minister told by the United States Government beforehand that it intended to bomb Hanoi? That is the question. That is all the Prime Minister has to answer.

Mr McEwen:

– The question took a long while to ask.


– Yes, and it is taking a long time to answer in that specific form. The answer to it in that specific form is: Yes. we knew before I left this country what action was to be taken and what our attitude towards it would be.

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Sir Wilfrid Kent Hughes:

-I wish to ask the Minister for External Affairs a question. Has the British Government sent to the Australian Government a copy of the report prepared by the Indian and Canadian members of the International Control Commission in Laos concerning the interrogation of nine North Vietnamese prisoners captured at the battle of Dong Hene in Savannaket Province, South Laos, from 10th to 15th March last year? If not, will the Minister ask for a copy and publish it and also ask why the report took nearly 18 months to compile? Can he confirm another recent report based on aerial reconnaissance by the Royal Laotian armed forces that there are now 60,000 North Vietnamese troops in Laos - 25,000 combat troops and 35,000 in logistic supply and roadbuilding teams on the Ho Chi Minh trail? Were not all North Vietnamese troops to be withdrawn under the terms of the 1962 Geneva Convention guaranteeing the neutrality of Laos?

Minister for External Affairs · CURTIN, WESTERN AUSTRALIA · LP

– A copy of the report to which the honorable gentleman refers is at present in transit from London to Canberra by diplomatic bag. The report consists of about 700 pages, and that is why it is being sent by surface. As soon as it is received, we shall see that a copy is placed on the table of the Parliamentary Library for the information of honorable members. I am not quite sure whether it is being sent by surface, but it is being sent by mail bag, at any rate. The reason why this report has taken so long to compile is related to many factors. The principal one, I think, was the need for the international Control Commission itself to check the evidence in Laos and the difficulty of obtaining the co-operation of the Pathet Lao in making that check.

Regarding the other parts of the question, I do not at the moment call to mind any report in the Department’s possession that refers specifically to the numbers of North Vietnamese and other troops in Laos as quoted by the honorable gentleman. But certainly we have information of very substantial numbers of North Vietnamese troops there. We have of course the statements by Prince Souvanna Phouma protesting against the presence of these North Vietnamese regular soldiers in Laos. It is well known, also, that trails through that country are being used deliberately by North Vietnam both for its support of the Pathet Lao and its intimidation of the Laotian Government and for the infiltration of troops and materials into South Vietnam. This, of course, is in direct violation of the agreements to which the honorable gentleman referred.

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– I preface my question, which is addressed to the PostmasterGeneral or the Minister for the Army, as I am not sure who the appropriate Minister is, by stating that recently the Minister for the Army was reported as having said that it was his intention to provide the most efficient mail service to our troops in Vietnam. As our servicemen now constitute a distinct unit operating in Vietnam, I ask why all outgoing mail must be channelled through the United States Army base in Honolulu.

Mr Malcolm Fraser:

– There has been a close examination of the possible alternative means of getting mail to Vietnam, and it has been found that the daily mail service out of Sydney to Honolulu, then using American aircraft proceeding to Vietnam, is the quickest and most reliable. Unfortunately, in the initial stages of this system, shortly after the task force arrived in Vietnam, there were some delays and some bags went astray.

Mr Reynolds:

– They still do.

Mr Malcolm Fraser:

– If any instance is brought to my notice of mail not arriving on time, that particular instance will be examined both at this end and in Vietnam. Honorable members will know that some time ago I put out a fairly lengthy Press statement, explaining in detail how first class mail and second class mail were handled and giving the reasons why the particular method was chosen. I do not want to canvass these points again at this stage.

Mr Jones:

– Is all mail carried by air?

Mr Malcolm Fraser:

– Yes, it is.


– Order! Interjections are out of order, and prolong a Minister’s answer.

Mr Malcolm Fraser:

– First class mail is all carried by air on a daily basis. Second class mail, which is charged for at surface mail rates, goes out of Sydney once a week by air to Honolulu and then is carried to Vietnam by air.

Mr Reynolds:

– It takes six to eight weeks to get there.

Mr Malcolm Fraser:

– On the reports that I am getting, the average length of time which parcels take to get to Vietnam is very much less than that. If any honorable member brings to my notice any instance in which delivery of mail has taken what he believes to be an undue length of time, that particular instance will be examined.

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– I ask the Minister for Shipping and Transport: Is the pick-a-back service on the Trans-Australian railway used for the transportation of stud breeding ewes from New South Wales to Western Australia? If not, will the Minister say why this efficient and expeditious method of transport could not be used for this purpose, as it would appear that the elimination of transshipment would result in the ewes ariving in Western Australia in better condition? I also ask the Minister: Does the Western Australian Government impose any quarantine regulation which requires the shearing of sheep before entry into that State? If it does, would this regulation apply in the case of sheep transported by the pick-a-back method?

Minister for Shipping and Transport · FORREST, WESTERN AUSTRALIA · LP

– I do not know of the pick-a-back method ever having been used for carrying sheep to Western Australia from the eastern States, although it is used for the transport of race horses, trotting horses and the like. One of the reasons could be that the pick-a-back method is considerably more expensive than using the standard type of sheep truck which is provided by the Commonwealth Railways. So far as quarantine regulations go, the sheep have to be passed by an inspector of stock at Kalgoorlie or, if that is not practicable, at Perth. They have to be certified as healthy and as being free from burrs, such as the Bathurst burr and the Noogoora burr. They also have to be shorn within six weeks of travelling. The necessity for inspection at Kalgoorlie may be another reason for not using the pickaback method for transporting sheep.

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– I ask the Prime Minister a question. Is it true that the Government has placed a ban upon its Ministers and members of the Liberal Party of Australia speaking at teach-ins and other public meetings organised to discuss Vietnam and conscription? If the Government is not prepared to accept responsibility for this ban. will the Prime Minister use his influence with the Liberal Party back room strategists to lift it? In particular, will the Prime Minister indicate his Government’s policy on the actions of the New South Wales and Victorian branches of his Party on this matter? I point out that it was reported in late July that, first, New South Wales branch officials received a letter from the New South Wales State Secretary of the Liberal Party stating that his executive had decided that Vietnam teach-ins should not be encouraged.


– Order! I point out to the Leader of the Opposition that a great deal of tolerance is allowed in the questions he asks, but that in the one he is now asking he may not be setting a good example for some of his colleagues.


– You know, Sir, that I would be the last person in the world to set a bad example to anybody. I want to know, Sir, whether the actions of the New South Wales and Victorian branches of the Liberal Party have been decided upon following a direction from the Prime Minister that his colleagues in this House should not discuss publicly the immoral policies that the Government is following in Vietnam particularly in regard to the conscription of the kids.


– The Leader of the Opposition has taken up a long time to build up a straw man of his own. There is no prohibition of the kind he has mentioned. I should have thought his own

Deputy Leader would be able to correct him on that point because I think it was as recently as on Sunday night that he was engaged in a discussion group with the Minister for the Army and the honorable member for Parkes. We have our own methods of bringing clearly to the public the issues which are involved in Vietnam. I can assure the honorable gentleman that the Australian public will be in no doubt as to the kind of issue on which they are voting when they come to the election in November.

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– Will the Minister for External Affairs inform the House of the present position with regard to overdue financial contributions to the United Nations, particularly in relation to the Soviet Union and France? ls Australia still paying more than its assessed dues each year in an effort to help keep the United Nations in existence?


– The honorable gentleman has raised rather a complex question. As he knows, Article 17 of the Charter gives the General Assembly the power to apportion the expenses of the organisation and Article 19 of the Charter provides that if a member is in arrears for more than two years, virtually that member loses the right to vote. In connection with the operations in the Middle East and in the Congo, the General Assembly carried resolutions setting up emergency forces in both the Middle East and the Congo. As a consequence of that vote by the General Assembly the problem of paying for the emergency forces arose. Notably the Soviet Union and France argued - they had a defensible argument - that it was not within the competence of the General Assembly to lay expenses on members in this fashion and both the Soviet Union and France did not pay. There was a request to the International Court of Justice for an advisory opinion. The advisory opinion of the Court, which I shall not canvass, did throw some light on the matter but perhaps did not give a final pronouncement on all the issues that were involved.

This situation led to what was known as the Article 19 issue, which led in turn to the delaying of the opening of the 1964

General Assembly meeting. That Article 19 issue, on which the Australian viewpoint was made known by me in this House on, I think, two separate occasions, was resolved eventually by an arrangement. I would not like to say anything at this stage that would disturb that arrangement, which enabled the General Assembly to continue with its business. The actual fact is that those nations which take the narrow view of the liabilities of members would allege that both the Soviet Union and France are in arrears. But that would not be a view that would be enforced, I think, at the present time by the United Nations Secretariat or insisted upon by a majority of United Nations members. As far as Australia is concerned, we have paid the amounts that we have been assessed. We have not paid more than the amounts that we have been assessed.

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– I ask the Prime Minister a question. Is it a fact that submissions have been made to the Government by well qualified sources in the Australian community expressing grave concern at the state of Australian arts and letters and stressing the urgent need for positive Government action to foster Australian arts and letters on a much broader and more practical basis than the Government has been prepared to provide so far, including its rather suspect proposition for a fine arts council which, it is felt, is nothing more than an effort to perpetuate the old firm of the Australian Elizabethan Theatre Trust behind a new front? Will the Prime Minister respond to the submissions put to the Government by instituting urgently an inquiry into the state of the arts in Australia today for the purpose of contributing practically to their development and so as to cut back the heavy drain of young Australians who are being forced to flee this country to other lands more appreciative of their creative ability?


- Mr. Speaker, I am quite interested, I assure the honorable gentleman, in this general topic. The Government has made some increased provision in its Budget this year without trying to resolve policy aspects finally. In fact, we have been encouraging expressions of opinion, suggestions, recommendations and ideas from a variety of sources. If those for whom the honorable gentleman speaks would care to make their views known to us in a little more detail-

Mr Hayden:

– What about the submission that the honorable gentleman received in 1961 about the state of Australian arts and letters?


– Does the honorable member mean that I received this as Treasurer or that it was received by the then Prime Minister?

Mr Hayden:

– I understand that the submission-


– Order! The honorable member for Oxley has asked his question. We do not want a discussion.


– If a proposal was made in 1961 which remains the view of those for whom the honorable gentleman speaks, I will certainly see that that is taken into whatever general consideration we give to this problem when a decision is being made later. But at present the matter does not enjoy the same order of priority as some other matters in which we are engrossed. However, this is a matter in which I am interested personally.

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– My question is directed to the Treasurer. May 1 remind the right honorable gentleman that he referred recently in this House to the difficulty of raising loans overseas, particularly having regard to the high rates of interest currently being charged. In view of the need to assist the United Kingdom with its overseas reserves, but having in mind recent newspaper comment on the possible devaluation of sterling, will the right honorable gentleman inform the House what is proposed to be done regarding the substantial loan maturing in London early next month?


– During my Budget speech 1 pointed out to the House that it was becoming increasingly difficult to raise loans overseas and that interest rates were gradually hardening. We have a loan of between $55 million and §56 million maturing in London early next month. By agreement with the United Kingdom Govern ment and in order to help we have decided to repay the loan on the due date rather than attempt to renegotiate it. The money is due by the State Governments of Queensland and Victoria - the bulk of it by Queensland and most of the balance by Victoria - with a small amount by the Commonwealth itself. The Commonwealth will find the money out of its own resources - that is, either out of loans that have just been raised or out of one of the trust funds that are available for the purpose.

The honorable gentleman also referred to the problem of interest rates. This illustrates the difficulty we have of raising loans overseas. Already on the United Kingdom market Australian bonds are showing a yield between li and 8 per cent. This Is not the kind of interest rate that we as a Government feel that Australia should pay. Australia has a high credit rating wherever we go, but I do not think we can expect those who lend money internationally to lend it to us at a substantial discount as compared with other countries. We are prepared to help the United Kingdom Government. We believe that by repaying the loan of between $55 million and $56 million we will be making a contribution to the defence of the £1 sterling.

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– My question is directed to the Minister for Civil Aviation. Can the Minister say what action has been taken on the petition that was signed by 100 licensed DC3 pilots and presented to him, requesting operational tests on DC3 aircraft in Australia?

Minister for Civil Aviation · DARLING DOWNS, QUEENSLAND · LP

– First let me say that no petition was presented to me. It may have been submitted to my Department, and I will make inquiries about it. Some further investigations were made recently in view of some submissions from the Australian Federation of Air Pilots regarding the operation of DC3 aircraft in Australia. New conditions, which are broadly the same as the previous conditions, have now been laid down covering operations for the immediate future. Advice regarding this was submitted in the last few weeks to the Australian Federation of Air Pilots.

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– I direct my question to the Minister for Health. Is he aware that some well known medical benefit organisations do not cover certain types of treatment, such as physiotherapy in hospitals, whilst others do? Will he look into the situation with a view to encouraging all the organisations to cover such treatment, thereby avoiding undue hardship for the patient who is receiving the treatment at a hospital?

Minister for Health · BARKER, SOUTH AUSTRALIA · LP

– Yes, I am aware that some organisations do not provide fund benefits for physiotherapy in hospitals or elsewhere. It is for the organisations themselves to decide the benefits that they will provide in the light of their own policies and in the light of the money they have available for such benefits. I point out also that ever since the beginning of the scheme the firm policy of the Commonwealth Government has been to interfere with the administration of the funds as little as possible. As the honorable member realises, some funds provide benefits for physiotherapy. People are free to choose the fund to which they will belong. No doubt, they will take into account their own needs and the benefits provided when they decide which fund to join.

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– Has the PostmasterGeneral or the Australian Broadcasting Commission received any request for a repeat showing of Michael Charlton’s film on Vietnam? If so, will the Minister accede to the request? Similarly, has the Minister been requested to have the Commission show the film featuring Mr. Bartos, a former member of the Central Intelligence Agency, who is now in Australia - it was shown recently on Channel 7 in Sydney - so that Australians might be beter informed on the Vietnam war?

Postmaster-General · PETRIE, QUEENSLAND · LP

– These are matters within the jurisdiction of the Australian Broadcasting Commission. As regards the Michael Charlton film, the Commission believed that the public had been given sufficient notice that the film would be shown. It believed also that a substantial number of the public saw the film when it was telecast.

Mr Calwell:

– After the Government had tried to censor it.


– One constantly hears these insinuations of Government interference in the operations of the Commission. I emphatically deny that such is the case. There was no indication whatever of interference by the Government. When it was announced to the Press that this programme would appear on the A.B.C. it was realised that the censor had not given approval for the programme to be shown. So the A.B.C. sought the censor’s approval to show the film. Finally the matter was referred to my colleague, the Minister for External Affairs, because the censor felt that this was a matter which should be referred to the Government. The Minister for External Affairs immediately determined that the film should be shown. So there was no attempt by the Government to stop the showing of the film. As for the other film referred to by the honorable member, I cannot bring to mind any knowledge of this film. However, I will look into the matter and give the honorable member an answer by letter.

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– I ask the Minister for Defence a question. In the light of certain unfortunate events arising out of the financial arrangements for construction at North West Cape - defaulting on payments and the concern felt by Australian shareholders - has the Minister anything further to tell the House about the possibility of an equitable solution of this problem?

Minister for Defence · PATERSON, NEW SOUTH WALES · LP

– For some time, the Government has been concerned about the difficulties into which contractors and subcontractors have fallen in relation to the construction of the communication station at North West Cape. The Government does not accept any financial commitment in relation to the construction contracts. Nevertheless, we have had talks with officials of the Embassy of the United States of America suggesting that we would like to see the matter settled, if possible, to the satisfaction of the contractors but certainly to the satisfaction of observers in Australia, who will realise that a right and fair assessment has been made in relation to many things which in a contract of this kind can fall under repeal. This was a view readily accepted by the United States Embassy. Discussions have been held with the Embassy and, through it, with the United States State Department. 1 am happy to say that in the course of the next few days 1 expect the United States to send to Australia two top level experts who will be authorised to look into all the contractual arrangements, to have talks with the contractors and the diplomatic people and to see what can be done towards achieving a satisfactory solution.

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– Does the Treasurer share the widespread concern in the community regarding the renewed bout of substantial increases in prices and public utility charges that have already occurred or appear imminent? I instance copper, steel, tyres, electricity, hospital fees and fares. Is it likely that in such circumstances the hardest hit will be those thousands of citizens and their dependants who live on fixed incomes - superannuation and fixed interest investments - and who are to receive no help from the Budget? Do these price increases threaten to wipe out the real benefits of any wage and pension increases that have been or are about to be approved almost before their implementation? If the Government shares this expectation of increased prices and charges, does it intend to do anything about it?


– I cannot make any precise forecast nor, for that matter, can any other person make a precise forecast of the likely impact on prices of increases in costs, but I would certainly state that we attempted to be generous to the pensioners in many ways in the Budget and we are sure we have been generous. We say that we have treated pensioners very much more generously than they were ever treated by a Labour Party government. I am glad that this question has been raised. During the course of the debate on the Budget and, I hope, on the social services bills as well, we will prove - and it will be easy to demonstrate - the enormous improvement that has taken place in social services, health and other benefits since this Government took office.

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Minister for External Affairs · Curtin · LP

– I wish to inform the House that in response to requests made by members of the House I am placing on the table of the Library a paper “ Nuclear Test Ban - Attitude of Communist China “ and a paper “ Text of the Communique of the Eleventh Plenary Session of the Eighth Central Committee of the Communist Party of China “.

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Ministerial Statement

Prime Minister · Higgins · LP

– by leave - The Government has decided that an investigation will be commenced this year into the feasibility of establishing naval support facilities for the Royal Australian Navy at Cockburn Sound, near Fremantle. The Royal Australian Navy has indicated the desirability of such a facility in the short and long term. It has been decided that before any firm decision is taken an expert technical investigation should be carried out at Cockburn Sound by a firm of consultant engineers to be engaged through the Commonwealth Department of Works. The purpose of this investigation will be to select the most suitable site for the possible establishment of the facilities and to prepare a design study and cost estimates. The results will be the essential basis for further consideration by the Government. The terms of reference for the study and the necessary arrangements will be completed as quickly as possible.

While the investigation will be directed primarily to the requirements of the Royal Australian Navy it will of course take fully into account the possible needs of allied navies for use of the proposed facilities, including in particular the possible needs of the Royal Navy. In this context honorable members will recall that I said last February, following the talks with Mr. Healey, the United Kingdom Minister of Defence, that we in Australia, if we were considering in future the establishment of facilities here for the purposes of our own growing establishment, would take into our thinking the circumstance that these facilities might at some point of time and in some contingencies be needed for United Kingdom service requirements.

In deciding to have the feasibility study made the Government has also taken into account the continuing development in the Cockburn Sound area and hence its growing capacity to provide industrial support. The investigation now ordered into the question of a further expansion of defence facilities at Cockburn Sound is in harmony with the Government’s general policy of encouraging regional development in appropriate areas of Australia in accordance with their particular characteristics and potentialities. Naturally the Commonwealth activity will proceed in the closest collaboration with the Western Australian Government - I have already notified the Premier of that State of our intention - to ensure that naval requirements and plans are properly integrated with those of the Western Australian State authorities for the development of the area.

I present the following paper -

Naval Support Facility at Cockburn Sound, Western Australia - Ministerial Statement- and move -

That the House take note of the paper.

Mr Calwell:

– I hope you will bear with me, Mr. Speaker, if, before moving that the debate be adjourned, I ask the Prime Minister whether this statement indicates the possibility of the early abandonment of the British base at Singapore.


– It carries no such implication, Mr. Speaker. The United Kingdom position was stated clearly in the defence review made in the United Kingdom Parliament by Mr. Healey, the Minister of Defence. Nothing has occurred since then which would, to my knowledge, indicate any departure from the arrangements proposed in that review.

Debate (on motion by Mr. Calwell) adjourned.

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Reference to Public Works Committee

Minister for Shipping and Transport · Forrest · LP

– I move -

That, in accordance with the provisions of the Public Works Committee Act 1913-1965, the following proposed work be referred to the Parliamentary Standing Committee on Public Works for investigation and report: - Additional facilities at Repatriation General Hospital, Springbank, South Australia.

The proposal consists of two main components as follows: -

  1. The erection of a new artificial limb and appliance centre which will replace the present inadequate facilities located in Putney Street, Adelaide. A single-storey building of brick and reinforced concrete is proposed at an estimated cost of $140,000.
  2. The erection of a new outpatients clinic which will replace the facilities at present located in two buildings at Keswick Army Barracks and which are now unsuitable and are also requred for the Department of the Army.

A single-storey building of brick and steel construction is proposed at an estimated cost of $430,000.

These works will require an increase in the capacity of the emergency generating plant, at an estimated cost of $30,000. The total estimated cost of the proposal is §600,000. I table plans of the proposed work.


.- I wish to speak very briefly on this matter. While I support the motion, I wish to make some reference to the manner in which references are now coming before the Public Works Committee. In 1961 the terms of the Public Works Committee Act were altered. This alteration in itself meant that more references would come before the Committee. At that time the need for a more even flow of references, from the point of view of time, was pointed out. Since 1961 the attention of the House has been directed, by the 26th, 27th and 28th Reports of the Public Works Committee, to this requirement of an even flow of references to the Committee from the point of view of time. I direct the attention of the House to the fact that from January of this year to the end of

July four projects were referred to the Committee and that in the last two weeks four additional projects have been referred to it. That means that since the beginning of January we have received eight references and four of them have been received in the last two weeks. Furthermore, we are informed that another three projects will come before the Committee before the House is dissolved.

The Committee is quite capable of dealing with these references and will deal with them. We members are not objecting to them. We are pointing out once again that as a parliament approaches its end there seems to be a rapid accumulation of references and that if more time were given to them in the beginning the demands that are now being made on the Committee would not have to be made. The Prime Minister (Mr. Harold Holt) has set 26th November as the tentative date for the elections. If the Committee does not present a report to the House before it is dissolved, the report is of no value at all because the Committee is dissolved when the House is dissolved. So the new Public Works Committee will have to go through the exercise afresh.

Quite a number of physical considerations are involved. It is noi merely a question of the hearing of evidence and the inspection of sites. There is also the question of the demands that are being made on the staff of the Committee. Considerable demands are made and considerable time is involved in connection with the preparation of reports. So 1 am not merely speaking from the point of view of the Committee itself; 1 am also emphasising the time factor that is involved. All the references that have come before the House, including the one that the Minister for Shipping and Transport (Mr. Freeth) has brought before us today, will be dealt with by the Committee and reported on to the House. In fact, the Commit’.ee already has made arrangements for evidence to be taken and inspections to be made. But, on behalf of the Committee, I again emphasise the importance of trying to achieve an even flow of references from the House to the Committee.

Minister for Shipping and Transport · Forrest · LP

– in reply - I can sympathise with the Public Works Committee in the problem that is created for it when there happens to be a sudden rush of works which, by statute, are referable to it. But I think the House should recognise that it is not always possible for the Government, in its works planning and programme, to achieve an even flow of works that are of such a size that they require reference to the Committee. A number of other conditions govern the priority that the Government accords to works. In theory, it would be possible to go for a whole year with a fully occupied works programme and without any particular work of such a size that it should be referred to the Committee. There are other occasions on which a number of such works, with an urgent priority, crop up, and two, three or four of them are referred to the Committee fairly close together. However, I will ask my colleague, the Minister for Works (Senator Gorton), to pay some regard to what the honorable member for Dalley (Mr. O’Connor) has said and to see whether references of works to the Committee can be spaced a little more evenly.

Question resolved in the affirmative.

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Second Reading. (Budget Debate.)

Debate resumed from 23rd August (vide page 331), on motion by Mr. McMahon -

That the Bill be now read a second time.

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

That all words after “ That “ be omitted with a view to inserting the following words in place thereof - “ the House condemns the Budget because -

It fails to recognise the injustices wrought upon wage earners because real wages have fallen as prices have risen faster than wages.

It makes inadequate adjustments to social service payments.

It fails to recognise the serious crisis in education.

It does not acknowledge the lack of confidence on the part of the business community in the future growth of the economy.

It does not recognise the need of further basic development, public and private, in addition to the need for adequate defence, and that balanced development can only take place by active encouragement to Australian industry and co-operation with the States. 6. It does nothing to relieve our dependence on a high rate of foreign investment to finance the deficit in our balance of payments.”


– Any budget is, in fact, a mirror of government policy. Last night the Leader of the Opposition (Mr. Calwell) presented to the House an amendment to the motion that this Bill be now read a second time. The first and principal clause of our policy and our criticism of the Budget, as stated in that amendment, reads as follows - it fails to recognise the injustices wrought upon wage earners because real wages have fallen as prices have risen faster than wages.

I do not propose to read any more of the amendment because if we can resolve this question the climate is such as to make an incoming Labour Government capable of achieving everything else to which the Australian Labour Party attaches its policy as was indicated last evening. The Labour Party indicated, through its leader, that we would go to a referendum without any delay for the purpose of giving the National Parliament power to control prices. We would do this not by pegging prices but by stabilising them.

I want to read only a very short passage from the Budget speech made by the Treasurer (Mr. McMahon). It is as follows - the Consumer Price Index has risen by only about 9 per cent, during the last five years.

That is not the correct way for the Treasurer to describe what has happened with respect to the consumer price index. He knows far better than I or any other backbencher on this side of the House knows that this index was brought into being by the Commonwealth Statistician to take the place of the old C series index and that the new index was introduced with the full blessing of the Government.

The next point that I want to make is this: Had the Commonwealth Conciliation and Arbitration Commission been left to use the consumer price index, as I shall show later, the index would have been taken as a measuring stick to assess a proper wage level in Australia having regard to prices. But this did not happen because of the meddling of the Government. The third point that I want to make concerning the consumer price index is that, whether or not we like it, there was an era when this Parliament had control of prices and a Labour Government was able to stabilise both prices and wages by relying on the C series index, the basis of which was not nearly so elaborate as that of the consumer price index.

On 11th July of this year, the Arbitration Commission handed down a decision that $2 a week should be added to the basic wage. I want to refer briefly to the policy of this Government as set out in a written submission to the Commission. It is reported as follows -

It would accordingly be apprehensive of the effects that other than a moderate wage increase could have.

That was the view of this Government on wage fixing in 1966. It never at any stage attempted to show what it meant by the term “ moderate increase “. The Commission, guided by the material before it, decided to increase the basic wage by $2 a week. I think I can safely say that nobody in Australia, whether he be a member of the trade union movement, a manufacturer, a retailer, or anything else, if he stopped to think, could at present feel happy if he understood how the wages of the workers are dealt with in relation to the economy. Nobody can feel happy about the decision to inject into the economy another $2 a week in the basic wage of every worker without any attempt to make sure that the purchasing power of the total wage paid to workers is preserved and that they get the real benefit, in their ordinary home life, of the additional $2 a week.

Can purchasing power be maintained? We on this side of the House say that, given the right powers, this can be achieved, and achieved in a very short time. This brings me to the way in which the economy has gone wrong in the last two years. I join issue with the Treasurer in his statement that the increase of 9 per cent, in the consumer price index has taken place over the last five years. What he should have said is that almost all of that increase has occurred over the last two years. That is the issue from which this Government continually runs away, and it is the very thing that causes the economy of this country to be ever on the ebb and flow and never stable.

In 1961, the Arbitration Commission attempted to stabilise prices. But what happened? L the purchasing power of the people is to be maintained at a proper level, the wage situation must be reviewed from time to time, and the Commission decided in 1965 that the basic wage set in 1961 had to be looked at. So I turn now to the principles of the 1961 decision. In looking at th..t decision, we must keep in mind the fact that, entirely at the behest of this Government, the Commission as it was constituted in 1953, eliminated quarterly basic wage adjustments. The present Prime Minister (Mr. Harold Holt), as Treasurer, believed that all the ills of the economy would disappear with the abandonment of quarterly adjustments. He believed that the constant drip of wage increases was the problem. But it was not.

On previous occasions, I have gone into the history of wage movement in Australia at each succeeding annual review. It is an interesting exercise, but I cannot enter into it today. The history of wage movement shows that the Commission, with each decision it made, really only brought wage standards up to the level that they would have reached had quarterly adjustments on the basis of the C series index been continued. The 1961 judgment of the Commission set a pattern after eight years of trial and error, with the Commission trying to satisfy itself that there was a measuring stick that could be used as a basis for stability in wage levels. For eight years after this Government’s policy of ending quarterly adjustments had been put into effect, the Commission found each year that it had to increase the basic v/age. Here I want to read just one short passage from the 1961 decision. It represents the basis on which we all should base our thinking. The Commission stated - lt seems to us clear that the Commission and the Court before it have never ceased lo recognise that although the criterion by which the basic wage is assessed is the greatest which the economy can afford, the purchasing power of the basic wage has always been a matter of importance.

That is what this Government has lost sight of - the purchasing power of the basic wage as it is assessed from time to time.

The basic wage represents not merely a minimum wage. It is, first, the minimum that, in the eyes of authority, the economy can afford to pay. Secondly, it is the minimum amount that the Commission believes the worker is entitled to have to purchase the things that should go into his own home and, within that framework, the amount that will keep the economy stable until the matter is looked at again. But what did the Commission do in 1961? It reversed the onus of proof position. The Commission increased the basic wage by 12s. and then said this in its judgment -

For the specific reasons set out in the judgment, we consider that in February next the only issue in regard to the basic wage should bc why the money wages fixed as a result of our decision should not bc adjusted in accordance with any change in the Consumer Price Index.

That stunned the profit makers in this country. The decision by the Commission to reverse the onus of proof requirement caused the profit makers in this country and their mouthpieces in this Parliament to decide there and then to do everything in their power to reverse the decision. Let me emphasise that all that the increase of 12s. did at that time was to restore the purchasing power of the basic wage to where it was in June 1960.

Honorable members opposite will argue that the trade union movement would not accept any fixation of wages. But what are the facts? The trade union movement agreed with the Commission’s decision to reverse the onus of proof position and welcomed the new procedure because it was clear that the greater proportion of the increases made to the basic wage had led to the swelling of profits, not to capacity to purchase something extra for the worker’s homes. The figures that I propose to quote will prove conclusively that this was so.

What happened in 1962? In that year, there was no increase of note in the Consumer Price Index and the Commission’s automatic examination of the position lasted only five minutes. The trade union movement accepted the position that, because the onus of proof requirement had been reversed and the profit makers had been prevented from passing on the 12s. increase immediately, the wage structure of the country should remain static. In 1963, two years after the 1961 decision, the

Commission again looked at the position and found that, because of its reversal of the onus of proof requirement, there had been no increase in the Consumer Price Index.

Then came 1964. It was found that between 1961 and 1964 there had been an increase of only 2s. in the Consumer Price Index. The Commission, after examining the matter - I throw this into the teeth of the Prime Minister, who talks so often about giving the workers the value of their productivity - decided that, because of the increase in productivity between May 1960 and 1964, the workers of this country were entitled, firstly, to the 2s. by which the Consumer Price Index had increased over those years, and secondly, to an additional 18s. for the improvement in what might be called the productivity index between 1961 and 1964.

Then came 1965. The trade union movement submitted an application, not for £1, not for 18s., but merely for the amount of the increase that had taken place in the Consumer Price Index as a result of the increase of £1 which had been granted 12 months earlier. This increase was 10s., and that was all that the trade union movement claimed. But what did this Government do? It argued before the Commission that any increase in the basic wage would be fraught with danger. This was the Government’s opportunity to get away from the Commission’s attempt to stabilise prices in Australia. The Commission knew that between 1953 and 1961 prices had not been stabilised and that something had to be done. It therefore decided to review the basic wage. Had this Government followed the lead given by the Commission in 1964 and had it allowed the trade union movement to work out its own destiny, the only increase made to the basic wage in 1965 would have been the amount necessary to meet the increase that had taken place in the Consumer Price Index. By 1966 the economy would again have flattened out, as it did following the 1961 decision. Just as there was no increase in the Consumer Price Index in 1961 and 1962, so there would have been no increase during 1966 and 1967.

But what did this Government do? It argued that any - I emphasise the word “ any “ - increase in the basic wage in 1965 would be fraught with a great deal of danger. The Commission listened to the Government. This was the first time since 1929 that the workers of this country had been denied an increase to offset what was the accepted reduction of the purchasing power of their wage. The Government opposed any increase and the Commission reversed completely its 1961 decision, which had proved so successful in preventing the profit makers from making the profits they wanted to make. The Commission decided that neither the basic wage nor margins should be altered because of movements in the Consumer Price Index. There has been an acceptance in almost all State jurisdictions of the principles laid down by the Commonwealth Arbitration Commission in 1961. New South Wales, Victoria, South Australia and Tasmania grant cost of living increases automatically. In Queensland, the basic wage is reviewed every 12 months and there the State jurisdiction follows what the Commonwealth authority was doing between 1953 and 1961. Western Australia follows a system which establishes clearly the soundness of the policy advocated by the Australian Labour Party. In that State, the Statistician publishes what is called a quarterly cost figure. The State authority takes note of that figure and decides on that basis what it will do about the basic wage. It is significant to note that up to 1964 neither the employers nor the employees in that State made any approach to the Court. They left it to the Court to determine the basic wage in accordance with the Consumer Price Index.

Now let me demonstrate what I said earlier, namely, that the greatest factor in causing an increase in prices is profits. As the Federal basic wages which I propose to cite are stated in pounds, I shall express them in that way. In June 1959 the Federal basic wage was £13 16s., and in July 1959 the basic wage calculated on the quarterly adjustment figure was £13 18s. 7d. In July 1961, in Western Australia, a basic wage based on quarterly adjustments was £15 0s. 6d., which was an increase of £1 ls. lid. on the figure for July 1959. In its 1961 decision the Arbitration Commission laid down the principles on which the basic wage was fixed with respect to the eastern States, and all the eastern States followed these principles. The effect of the Commission’s decision was that until 1964 the only increases would be those flowing from increases in the consumer price index. Although not stated by the Commission or in the act in Western Australia, this was the effect of what happened in 1961 and of taking from the profit makers their right to pass on every increase in wages.

Between July 1959 and July 1961, before the reversal of the onus of proof requirement at the Commonwealth level, the basic wage in Western Australia rose under the quarterly adjustment system by only £J ls. lid. Between July 1961 and July 1963 when Western Australia received only the amounts which resulted from the policy laid down by the Arbitration Commission in its 1 961 decision, the basic wage rose, again with quarterly adjustments, from £15 Os. 6d. to £15 ls. 6d. In other words, there was no difference between those two periods of two years so far as the workers own living standards were concerned. B-ut in that first two years the profit makers in Western Australia made a net gain of £1 a week. There was a time when Australia had a government which had power to deal with prices. On I 10th February 1942 the Labour Government acted under the National Security (Economic Organisation) Regulations and pegged wages and prices at their then existing level throughout Australia. It determined also that wages would be increased only where anomalies could be shown and that prices could be increased only where a case could be made out to justify an increase. What happened? It took 12 months for the economy to settle down and. in this period, the normal quarterly adjustments based on the C Series index were granted. As I have said, this regulation became operative on 10th February 1942. At that stage the Commonwealth basic wage was not set as it is now: there were a special rate for Kalgoorlie and another rate for Port Augusta and other rates again for various other areas. The six towns basis had not been settled at that stage. I propose to cite the figures for Victoria where the rate was always at about the same level as the figure which we now accept for the Commonwealth.

In July 1942 the basic wage in Victoria was 1 5s. per day. Between then and October 1943- a matter of 16 months - it rose to 1 6s. 4d. per day, or about 5s. per week. The basic wage then settled down. Between November 1943 and May 1944 it actually fell by 2s. per week. This was at a time when, under the national security regulations, there was power to control prices in Australia. Between October 1944 and November 1946 the basic wage, calculated on the C Series index, increased by 2s. per week. In December 1946 the Commonwealth Arbitration Court increased the basic wage by 7s. per week on productivity grounds. So we had the situation that between July 1942 and November 1946, in a properly regulated economy, a Labour Government was able to keep the prices at such a level in this country that the basic wage, adjusted in accordance with the C Series index, rose by only 8s. a week in a period of four years. It might be said that there was a great difference between conditions then and later. I think it could be argued successfully that because of the upsurge in production the gross national product was increasing so swiftly that it took up any slack that developed. I am prepared to concede also that the upsurge in the national economy owing to war production needs had a levelling effect.

I put it to the Government that what the Labour Government did between 1942 and 1946 and what the Arbitration Commission did between 1961 and 1964 will be done again by a Labour Government as soon as this Party comes back into office. Action of this kind may mean that for a short space of time some form of subsidy will be needed. The addition of £1 per week to the basic wage is reflected in the worker’s pay envelope. If the small businessman can show that, as the result of an increase in the basic wage, his costs exceed a reasonable margin of profit, he should be subsidised to that extent. Even if this action required the provision of £200 or £300 million from Consolidated Revenue for the first or second year, the economy would eventually flatten out as it did in 1946 and again in 1961. Those years set a pattern. The present Government is the worst offender in setting a pattern by taking away from the basic wage in taxation the purchasing power of which the Commission spoke in 1961. Let me show what happened after the Commission in its decision delivered on 8th July 1966 set a minimum wage.

Take the case of a single public servant on the basic wage at 8thJuly. He hears about the $2 increase in the basic wage and about the minimum margins increase. He says to himself: “ 1 am in clover from now on; my word I am.” But let me show what happens. To his old rate of $30.80 per week must be added the basic wage increase of$1 04 per year. His old rate of taxation was $142.43. That is the amount deducted under the Government’s taxation proposals from the basic wage earned by this man. With the addition of $104 to his income his tax increases by $9.35, and he pays $151.78. He thought that he would have something on the side from the minimum margins increase of $3.75per week, which amounts to $195 per year. If that amount is added to his total income his taxation jumps from $151.78 to $198.03. In other words, at that point of time he will receive less, after the Government has taken taxation, than the minimum set by the Commission as a basic wage. Arising from the Commission’s decision he had a total increase of$297, but from that amount he pays an additional $55.60 in tax, that is, almost 20 per cent, of the increase he received.

Mr Allan Fraser:

– That is in direct taxation.


– That is in direct taxation alone. Take the case of a basic wage earner who is a married man with one child. Because of the $2 per week increase he pays an additional $6.65 per week, and with the $3.75 minimum marginal increase which he receives as an employee on the minimum rate his tax rises from $71.86 to $98.07, a total of $26.21. Although a married man with one child finds that his tax rises by $26.21, a married man with two children finds that his tax increases by $26.71 as a result of this Government’s policy. This Government is the worst offender in Australia in reducing the living standards set as a minimum by the Arbitration Commission.


Order! The honorable member’s time has expired.


Mr. Deputy Speaker, the reconciliation of the multitude of conflicting social interests and economic pressures that must be made in framing an annual Budget for a modern state requires the wisdom of Solomon, the patience of Job, the flexibility of Houdini and the sense of balance of Blondin.I am not going to suggest to the House that the Treasurer (Mr. McMahon) is in full possession of all these extraordinary virtues; nor am I going to suggest that he is equipped also with that other fiscal advantage, a hide like a rhinoceros. But I would like to express my congratulations to the right honorable gentleman on this, his first Budget. I have no doubt that those honorable members who continue to remain in this place will listen in future to many more thoughtful and economically sound discourses from his lips on the same subject. My only comment on his physical effort is that he might give consideration to some larynx lubrication before he undertakes another Budget marathon. Furthermore, I should like to compliment the Governor and the officers of the Reserve Bank in making their annual report available so early in this session. I am sure that this has been a vast help to honorable members in the compilation of their thinking on the Budget discussion.

During the course of his remarks the honorable member for Blaxland (Mr. E. James Harrison) touched on a subject that is one with which I propose to deal at some length later on. I feel that it is a very important subject. Although the honorable member’s solution would not be my solution, J can well understand that this question of the narrowing gap between prices and costs is one that confronts the whole of the Australian economy. For that reason I believe that it is one of the most important subjects to be discussed each year when we have the opportunity of considering the Budget.

I should like to make some reference to the speech delivered on behalf of the Opposition by the Leader of the Opposition (Mr. Calwell) last night when he moved various amendments to the Budget. I wish to draw attention to one or two propositions that the Leader of the Opposition put forward with which I cannot agree. The Leader of the Opposition said -

We believe that the Treasurer has failed to recognise the need to stimulate the economy by sensible, moderate expansionary measures.

I underline the word “ expansionary “. On this point, 1 join issue as one who feels a deep responsibility for the primary exporting industries. Any suggestion of forced expansion at a time of exciting development throughout the Commonwealth implies, to my mind, pouring petrol on the fires of inflation. 1 would suggest to the honorable gentleman and to the House generally that the best and healthiest influence in the matter of national equilibrium at this time would be substantial drought-breaking rains followed by good weather in the drought areas of northern New South Wales and Queensland. I can only hope that this event will take place in the near future because I feel quite certain, and honorable members will agree with me that, as far as the general equilibrium of the Australian economy is concerned, if New South Wales can get back on an even keel and the farming community there is restored to its purchasing power, this will be the greatest fillip to the national economy and far greater in benefit than any artificial stimulation. I believe also that this would be almost as beneficial to the national economy as the return of the Holt-McEwen Government later this year.

The second point in the speech of the Leader of the Opposition that I wish to mention is his reference to the Government going on its knees to Britain and the United States, and his statement that Labour would not demean itself to that extent. I know that you, Mr. Deputy Speaker, have a very clear recollection in your mind of what happened in 1942 when the then Australian Labour Party government of the day, led by the late John Curtin, in a time of great crisis, I admit, went screaming for help to the United States Government in our time of trouble.

Mr Peters:

– That is a nice word - “ screaming “.


– That is so. Such is the gratitude of the people opposite that, now that the poison of ideologies has so penetrated the Australian Labour Party, its members have cut from their memory the recollection of the vast assistance by the United States of America to Australia at that time. Now, like cheeky and ungrateful little boys, honorable members opposite go to great lengths to discover reasons why they should criticise every action taken by the United States of America, particularly in our immediate sphere of activity to the north of Australia.

The third point that I wish to mention in relation to the speech delivered by the Leader of the Opposition is this: The Leader of the Opposition said -

The members of the Regular Army were given no say as to whether or not they would volunteer for Vietnam.

The implication of this statement is quite fascinating. I can conjure up in my mind a vivid picture of Colonel Calwell calling a battalion onto parade at a military centre and saying to the boys: “ Well, where would you like to go fighting this month, or next month?” Have honorable members ever heard such a fantastic conception of military service? I think that it is almost imbecile to try to impose that kind of thinking on this House. The implication is nearly as intriguing as the reported statement by the Leader of the Opposition about the Vietcong feeling the ankles of our soldiers in Vietnam to identify them from Americans.

The other classic remark which the Leader of the Opposition made towards the end of his tirade and which, as a finale to his speech, brought down the House, was that the Labour Party enters the forthcoming election campaign “ united, determined and confident “. Determined the Labour Party may be; confident the Labour Party may be, although this confidence is sometimes misplaced; but united - well, I leave that to the House to decide.

Whatever the situation was in our part of the world a few years ago - and I refer to those areas immediately to our north as well as the areas east of Suez in which Australia by its geographical position must take interest and accept substantial responsibility - this situation has certainly been aggravated by the unavoidable expressions by a number of people with political influence in the United Kingdom that Britain’s economic and balance of payment problems must bring about a curtailment of military activity in the area of Australia’s main concern. This situation has been influenced also by the events leading to the end of confrontation between Indonesia and Malaysia and the withdrawal of British forces from the Borneo States of Sabah and Sarawak. In passing, I draw the attention of the House to Australia’s role in this very difficult international crisis. The Australian Government must receive the respect of all people in Australia who are capable of objective thinking in that, first, we supported our friends in Malaysia in accordance with our treaty obligations; second, that we were firm with Indonesia and left no doubt in its mind where we stood; and, third, that we have achieved, I believe, greater prestige and respect from our Asian friends, not excluding Indonesia.

I believe that I express the wishes of all when I say that I sincerely hope that the outcome of this very explosive and difficult situation will be that the friends of Indonesia will assist it successfully over its economic and administrative hurdles so that it will be in a good position to raise the standard of living of its people and make the cultural and economic contribution to this part of the world’s surface for which ils people have such a capacity. It seems to me one of the most frightening features of modern international relations from which we ourselves cannot escape that so much of the economic products of the developing countries should have to be devoted to the production and maintenance of substantial military efforts when there are so many pressing economic and social problems for which finance is urgently needed that await solution.

This brings me to my next point; that is, the present climate in South East Asia. I admit that I subscribe to the domino theory of Communist imperialist expansion, lt makes it unavoidable that the Government and its advisers must undertake greater defence expenditure for the protection of our homeland. But what obviously is more important at this period of history is that we should be in a position to honour our treaty obligations and play our part as a responsible nation to assist our friendly neighbours to avoid being overrun by the tide of aggression. The history of recent events to our north in which Australia has played a positive role, I believe, clearly illustrates the point 1 am trying to make. Our action in support of the Government of Malaya during the time of subversion there in the 1950’s, our action in support of the United Nation force in Korea and the conclusion of the recent confrontation between Indonesia and Malaysia are the direct results of this wider appreciation of Australia’s military responsibilities. Admittedly, the Opposition was firm on Korea, but it must never be forgotten that in the other two instances the official policy of the Australian Labour Party was that Australian troops should be kept at home. We on this side of the House have no illusions about the ramifications of military action or the suffering and losses that such action may involve. But no government worth its salt will run away from its military responsibilities because the acceptance of such responsibilities may be unpopular and may not attract electoral support.

The Opposition’s basic isolationist approach, that the defence of Australia should be fought in Australia, is a repetition of its attitude in 1938 and 1939 when it opposed and criticised every attempt by the Government to hasten Australia’s preparedness. Even the honorable member for Lalor (Mr. Pollard), whose loyalty I would never question, is on record in “ Hansard “, volume 159 at page 2148 of 25th November 1938 - less than a year before the outbreak of World War II - as saying -

On the subject of defence I hold views different from those of many honorable members. In my opinion, the proposed expenditure on armaments and defence equipment is utterly futile in a country with 12,000 miles of coastline and vast resources. The comparative isolation of Australia makes its invasion by an enemy difficult, especially as an enemy would have to keep open its lines of communication.

They were almost famous last words in 1942. This form of isolationism is characteristic of much of the defence thinking of the Australian Labour Party. But I am more concerned by the appreciation - a very recent and very pertinent appreciation - made by Professor Arndt that the Leader of the Opposition and his colleague from Yarra (Dr. J. F. Cairns) want to see the Communist controlled Vietcong win the struggle in Vietnam.

Mr Duthie:

– That is a lie.


– That is what he said in his article.

Mr Duthie:

– Who said that?


– Professor Arndt. I will get a copy of it for you, if you like.

Mr Duthie:

– It is a lie, and I would say this to his face.


– Anyway, it is Professor Arndt’s opinion that the Leader of the Opposition and one of the front bench members opposite want to see the Vietcong win in Vietnam. This would mean that the Red terror would be imposed on the whole of the people north and south of the 17th parallel. It is therefore refreshing to see some semblance of sanity creeping into views expressed by the Deputy Leader of the Opposition (Mr. Whitlam) and others who have recently had the opportunity at first hand to take a more objective view of this nightmare situation.

South Vietnam is an infinitely more intractable military and political problem than that which arose out of Communist infiltration and subversion in Malaya in the 1950’s or confrontation in Borneo; but this is no reason why Australia with a vast interest in peace in South East Asia should throw up its hands, as did the Leader of the Opposition earlier this year when he said in this place that he thought Australia had no moral obligation to enter into the sphere in military terms. In other words, his attitude was - I regret to say this - that we could s’.ill retain our pride by allowing the conscripted sons of American mothers to fight the battles of our survival on our front door step. That is not a very proud situation to accept.

I now want to come to my second subject. I have often referred to the constant pressure on prices and resources of capital and labour that the rapid development and expansion we are undertaking in Australia imposes on our economy. Especially is this aggravated when we are also in the process of honouring a military obligation to assist in preventing some of our neighbours in the free world from being overrun by Communist imperial expansion. In the past I have drawn attention to the dangers for our exporting primary industries if their cost levels are forced up by the incidence of inflation in the Australian economy. But, of course, this applies with equal force to those people with fixed incomes, superannuation or pensions, who see their means of livelihood being eroded by rising prices and the decreasing purchasing power of money. Furthermore, as Australia becomes more and more reliant on the export of the products of her secondary industries, the effect of rising production costs on manufacturing must eventually restrict or eliminate our capacity to compete in world markets. Unfortunately, far too many people in the community, academics and others who should know better, regard some degree of inflation if not with affection at least with benign acceptance. To be objective on this subject, I find it extremely difficult to visualise an economic situation in which the conditions of growth and expansion do not impose very serious and continuing inflationary pressures. However, it is indisputable that certain of the conditions in our economic and constitutional structure bring about circumstances that give direct encouragement to inflation. Not the least of these are the financial relations between the Commonwealth and the States, and the decisions and rulings of the Commonwealth Conciliation and Arbitration Commission and the various State industrial tribunals.

The control of fiscal policy within the Commonwealth obviously belongs with the Federal Treasury under the direction of the government of the day. In this sense, any Federal government is regarded as the designer and executor of Australia’s economic policy, which determines the level of industrial and commercial activity and the rate of economic growth. However, under our system, this is only partially true and in many avenues of fiscal diversion the governments of the States can institute actions affecting the general cost structure which force the hand of Commonwealth authorities and leave them little alternative but to follow suit. A classic case which I shall mention to the House is the introduction of the forty hour week in New South Wales in 1947. I am not criticising the action or saying whether it was right or wrong. I am merely saying that this is a case in which the people who should have the complete authority have their hand forced by the unilateral action of a State government. This is only one of several cases in which the New South Wales Government, which has limited responsibility and hence cannot be blamed for creating inflationary circumstances, has forced the hand of the Commonwealth agency, in the form of the Commonwealth

Court of Conciliation and Arbitration, as it was then, and made it adopt policies which inevitably must have an inflationary effect on the national price structure. I could mention a number of similar actions by State governments which have directly affected costs in Australia, in particular the escalation of long service leave.

For some time 1 have been unsuccessful in seeking an official estimate of the increases in the hourly cost of labour, having regard to variations in the basic wage and the reduction in hours worked which would take into consideration all the additional costs involved in a weekly wage, such as workers compensation insurance, long service leave, annual leave and sick leave, so that it would be possible to make a direct comparison of what it costs per hour to employ someone in industry today with what it cost, say, twenty years ago. Even allowing for the depreciation in the value of money which has been a continuing pattern all over the world since World War II and which was greatly accelerated by the pressures of the Korean conflict, the comparison will be found to show that the hourly cost of labour has risen far in excess of the figures of the cost of living or the consumer index over the same period.

Mr Peters:

– Output has multiplied.


-This is so and it is very difficult to relate the thing in detail in Australia because you have so many variations in the community. You have male and female labour and other problems. This is why I have not been able to get the figures I wanted. Too often, people who should know better when referring to labour costs speak only in terms of the money wage and completely ignore these other direct components. In other words, to talk always of a weekly, monthly or annual salary or wage is far from appropriate when assessing the labour cost in any industrial undertaking. What really matters is what it costs per hour to give employment and, of course, as a sequel, to what extent the hourly cost can be diminished or made more productive by the introduction of machinery as a supplement. It is my firm belief that in the chain of cause and effect the continual rise in the hourly cost of labour has been the greatest stimulus to the employment of mechanical aids and has accelerated the introduction of automation.

I have digressed a bit from my main theme, which was to indicate to the House that under our present system the action of State Governments - completely within their legitimate rights - can have a vast effect on economic conditions within the Federal body. Although, as a result of our uniform tax system, the States rely on the Commonwealth to collect and distribute to them according to a well established formula their share of income tax collected, by their own actions they can increase national costs and consequently place themselves in a position where for financial stability they must come cap in hand to the Premiers* Conference and Loan Council or at intermediate periods to ask for more than the reimbursement formula provides.

I know that this is politics and, by and large, I think the State Governments take a responsible view of living within their anticipated incomes. As in Victoria, strenuous efforts have been made through the imposition of additional State taxes, such as land tax and motor taxes, to bridge the gap. But in an election year the temptation to go a bit wider, either by making labour conditions better for State employees or by providing more finance for worthy local objectives, is too great to ignore. Personally, if I could see a satisfactory way for the State Governments to have restored to them their income taxing authority I would be all for it, but I know there would be a lot of normal citizens who would be violently opposed to it. In fact, I suspect that if a referendum were held on this issue the only people who would vote in favour of restoring State income taxing rights would be the State politicians, and a number of them would be lukewarm, knowing full well how good an escape clause is the argument that if only the Commonwealth would provide more finance the States would be more generous.

Typical of the muddled thinking on this question of Federal and State financial relations was a reference in a letter in one of the leading Melbourne daily newspapers about the effect on State expenditure of the recent rise of $2 in the basic wage. The correspondent expressed his opinion that the increased collection from income tax - he did not mention pay roll tax - would amount to at least $40 million, and that this is the amount the Commonwealth should add to the reimbursements to the States. Unfortunately, what the correspondent had completely ignored was that the Commonwealth itself is a very substantial employer, either directly through the Public Service or indirectly through business undertakings such as the PostmasterGeneral’s Department and also the Armed Services. While it is probably true to say that in the current year of a basic wage rise the Commonwealth Treasury’s cash position is improved through income tax and pay roll tax collections as against its payments for the Commonwealth wage and salaries bill, this estimate does not take into consideration the many other indirect results of the increase in the basic wage. A few of these are the increased costs of goods, services and contracting charges. In addition, there is the inescapable obligation to increase repatriation and social services benefits and to adjust pay for the Armed Services. It is impossible to arrive at precise figures in relation to this matter but in an overall estimate covering these other points I have mentioned it is reasonable to assume that the increase in Commonwealth expenditure flowing from the increase in the basic wage would exceed the increased revenue from taxation.

I want to conclude on this point: Australia is a country going through one of the most amazing periods of growth in the history of the modern world. Probably one of the most refreshing experiences one can have is to visit Western Australia, as I did. The State is li’ke a giant awakened from his slumber. It is fairly bursting at the seams - although that may be mixing the metaphors. So many projects of immense significance are taking place at once that, in my opinion, there is no need for the artificial stimulation of the economy of the country as a whole. The future for expansion in Western Australia is so exciting that the State must develop out of all proportion to development in the rest of the Commonwealth. This is immensely good. Western Australia is a huge area which so far has been partially ignored. Vast projects are under way, such as mining projects and the building of new cities. The great Kwinana complex is an important project. Today the

Prime Minister (Mr. Harold Holt) referred to the defence aspects of the project at Cockburn Sound. What escapes the attention of the public, which hears a lot about the spectacular features of the Ord River scheme is the development that is taking place in the rainfall areas in the south west of Western Australia on a sound and solid commercial basis. These developments obviously must make the State richer in the future. I sometimes think that if only one third of the money that is sought to be used in schemes for northern development were devoted to development in the south, much greater progress would be made towards feeding the starving mouths of Asia.

I am very happy to be in the Parliament at this time. My only regret is that this is probably the last speech that I will be able to make here. Soon I will be like the old racehorse, looking in from outside and saying: “ They are not as good as they were in my day but they are not doing badly.” I hope that on 26th November, if that be the firm date for the elections, we will see a continuation in office of the present good Government and an approval of the splendid. Budget that has been brought down. [Quorum formed.]


.- When two normal people disagree, often one is right. When members of the Liberal Party disagree, generally all are wrong. Opinions of the first Budget of the new Treasurer (Mr. McMahon) differ very widely among leading members of the Liberal Party. The Premiers of Victoria and New South Wales are sure that the provisions, or lack of provisions, for services in their States will make it absolutely necessary for the Governments of Victoria and New South Wales to considerably increase taxation and the cost of all services to their people. Already in Victoria fares have been increased and it appears that Sir Henry Bolte, the Premier, is suggesting a new tax. The proposed methods of raising additional revenue will increase the costs of goods and services. The higher cost of living that will rapidly follow the measures of the State Governments will rob wage earners of the value of wage and salary increases that are being granted by wage tribunals, and pensioners and others will secure no improvements from adjustments that will be made in social service payments as the result of this Budget.

The Commonwealth Treasurer claims that the needs of defence, expanding development and additional services are such that in terms of cash receipts and outlays this Budget will probably run fairly heavily into deficit. He also said - . . we regret that we cannot propose general reductions in taxation. The weight of our expenditure commitments, especially on the side of defence, precludes such a possibility even though the Government is very conscious that the burden of taxation has increased in recent years, particularly for the individual taxpayer. It is the price we pay for growth and for security; but it is also a warning that, as a nation of fewer than i2 million people with a continent to develop, we face strict limits on the commitments we can and should accept.

The Treasurer has made it clear that he will not accept further commitments for this year on behalf of the States, no matter how Sir Henry Bolte may fume and brag and no matter what may be the results of Sir Henry’s negotiations and alliances with the Premier of New South Wales. The Premier of Victoria has made it clear that his Budget will announce extra taxation and charges upon the people of Victoria. During the last few weeks fares have been increased and now Sir Henry Bolte suggests an extra tax. ls Victoria the victim ofthe Commonwealth Treasurer’s Budget, and is there no option for the Victorian Government but to ruthlessly attack the living standards of the average Victorian family? Must Sir Henry Boltetake away - and perhaps more than take away - what wage tribunals have given, and are shortly to give, to the worker? Must he deprive pensioners and others of the little that the Commonwealth Government now proposes to provide in the form of improved social service payments? I suggest to the Premier of Victoria, who boasts of his knowledge of arithmetic, that he should survey the profits that have been made in his own State by business men of all descriptions during recent years. These profits have ranged up to hundreds of per cent. He might then have means devised to secure some of the excess profits to finance the works of his Government. He could also look at the large and rapidly acquired profits that have been and are still being made by the purchase and sale of properties, businesses and shares of every description. The size of these almost unearned increments might inspire him to follow the example of other nations, including the United States of America, and seek with the assistance of the Commonwealth Treasurer the imposition of a capital gains tax. Then again the Victorian Government might abolish or restrict its lavish concessions to overseas companies in the forms of reduced electricity charges - in the case of Alcoa of Australia Pty. Ltd. this amounts to S6 million a year - and other unnecessary and costly concessions being made to induce all types of firms to establish themselves in Victoria rather than in other States.

The Commonwealth Treasurer, too, should investigate the methods by which some of the immense profits being made by big business, and some of the huge sums being made as a result of the sale or takeover of Australian businesses and properties, could be diverted to promote Australian development and security. The Commonwealth Government should immediately examine the double taxation agreements that operate between this and other countries. It might then discover that some or all of them should be modified or eliminated. Australia has concluded agreements for the avoidance of double taxation with the United Kingdom, the United States of America, Canada and New Zealand. I quote from a publication issued by the Australian Commissioner of Taxation in 1965 -

Stated broadly the double taxation agreements provide that -

the Australian tax on dividends paid to United Kingdom residents is to be limited to one-half the amount that would have been payable if the agreement did not apply - in practice, the tax is limited to15 per cent, of the dividend; and

Australian tax is not to exceed15 per cent, of the dividends paid to the residents of other countries with which Australia has made agreements.

This publication, “Australia: Taxation and the Overseas Investor”, states -

A withholding tax applies to dividends derived by non-residents of Australia from Australian companies. . . . The rate of withholding tax on dividends flowing to the United Kingdom, the United States, Canada and New Zealand is 3s. in the £1.

On dividends payable in other countries with which Australia has no double taxation agreements the rate of withholding tax is 6s. in the £1. Not long ago I asked the Treasurer -

  1. What has been the taxation received by Australia each year from countries with which Australia has double taxation agreements since the operation of such agreements?
  2. What taxation would have been received by Australia if no double taxation agreements operated?

The reply stated very definitely that statistics were not available that would enable my questions to be answered. Here we have agreements that are costing Australia more and more every year. The Government does not know how much they are costing - nor, apparently, does it care. I have tried to discover from official documents what these agreements are costing Australia. A document on investment income payable overseas by companies in Australia, issued by the Commissioner of Taxation in May 1965, shows that in 1963-64 company investment income payable overseas was $272 million. This was payable after the deduction of dividend withholding tax.

I ask honorable members to consider this carefully: The rate of tax paid by investors in the United States on dividends received from General Motors-Holden’s Pty. Ltd. and other companies, no matter how great the amount or how high the rate of profit, is less than the rate paid by investors in Australia. An Australian worker with a taxable income of $3,000 from personal exertion would pay $460. The foreign investor receiving the same income would pay $450, no matter how wealthy he was. An Australian with an income of $7,000 - and most of the members of the Parties opposite would be getting more than that - would pay in Australia $1,982, while a New York investor in General MotorsHolden’s Pty. Ltd. would pay $950 to the Australian Government.

Roughly the position is this: Of the $272 million, $14 million was payable in countries with which we have no double taxation agreements. The tax on the amounts payable overseas would be $52 million. If no double taxation agreements operated it would have been $96 million, or $44 million more. Remember this: The amount of $272 million payable overseas in 1963-64 was by no means the total amount payable overseas; it is only the estimated amount payable by companies. The total amount payable in countries with which Australia has double taxation agreements would be much higher than the $258 million shown as payable in 1963-64. Remember this, too: The amounts payable annually are increasing at an alarming rate. In his Budget Speech the Treasurer (Mr. McMahon) said - and I use his exact words -

We have had a net capital inflow of $2,500 million.

On the earning capacity of this fabulous amount, plus all the amounts previously invested by United Kingdom, United States, Canadian and New Zealand investors, onehalf the amount has been received in taxation that would have been received if there had been no double taxation agreements. Last year more than $800 million was invested from countries with which we have double taxation agreements. During the five years ended 1965 total income payable overseas by companies in Australia was $1,234 million. About $1,200 million of this went to countries with which Australia has double taxation agreements. The withholding tax of 15 per cent, payable on this was $180 million. Had there been no double taxation agreements it would have been twice that amount, or $360 million. So here we see a concession of $180 million in five years.

I know that much of the profit of overseas companies was not remitted to investors, but about half of the profit was, and efforts are being made by the United Kingdom and United States Governments to see that more and more of the profits are remitted to those countries. I know that when introducing legislation in connection with double taxation agreements Sir Arthur Fadden said that the concessions were reciprocal. Everyone knows that Australian investments abroad are minute when compared with overseas investments in Australia, and they are likely to remain minute.

The Budget reveals that $1,000 million will be spent on defence this year, and a further amount of nearly $5,000 million will be spent on other services provided by the Commonwealth Government. All this expenditure contributes to the security and earning capacity of Australian assets, whether owned locally or overseas. It contributes, relatively, to assets owned in Japan and Germany services as great as to those owned in the United States. It serves those countries that have double taxation agreements and those that have not. Pay particular attention to this: Dividends paid overseas contribute once to Australian taxation. Having been paid they fail to give further assistance to Australian development, and, of course, they do nothing further to raise our living standards or promote national security. Dividends paid in Australia to Australians keep on contributing to taxation as the money passes from hand to hand in the purchase of goods and services. They keep on aiding our development and promoting out security.

It is said that taxation and other concessions are necessary to encourage the investments of capital in Australia. This is doubtful, just as it is doubtful that any and every kind of capital should be encouraged to take over Australian industries of all kinds. There was much investment of overseas capital before double taxation agreements. General MotorsHolden’s Pty. Ltd. was established before the United States had negotiated a double taxation agreement with Australia, and there was considerable United States investment in Australian companies before that agreement. Chinese, Japanese and West German moneys are being invested here without taxation concessions. Surely companies enjoying profits of 20 to 100 per cent, and more do not now need - if they ever needed - taxation concessions. General Motors-Holden’s Pty. Ltd., Caterpillar of Australia Pty. Ltd. and MercedesBenz (Aust.) Pty. Ltd. have all had profits of more than 100 per cent, in one year. Is it reasonable that some foreign investors reaping immense dividends should pay half the rates of taxation paid by Australian and some other foreign investors whose percentage return on capital is much less? Can this country continue to provide all the needs of defence and spend increasing amounts on immigration and development while every year a bigger and bigger proportion of the earnings of our industries go to foreign investors who enjoy exceptional and unnecessary taxation concessions? This is not merely unfair to Australian taxpayers; it holds dangers for the future of this nation.

Already at least 30 per cent, of the industries of this country are owned overseas. How much of the real estate is owned overseas no-one knows. The proportion of our industries owned in other lands is approximately the same as the proportion of Canadian industries owned by the United States of America only 10 years ago. Australian industries are passing into foreign hands as rapidly as Canadian industries ever passed into the hands of United States investors. Today the Government of Canada, which is not a Socialist or Labour Government, is urgently seeking to remove from Canadian industry the stranglehold by United States businessmen. Proposals before the Canadian Parliament, and in a wide debate outside it, amount to the harshest measures Canada has ever contemplated to encourage local ownership and to penalise foreign takeovers. On 13th July 1966 the Melbourne “ Herald “ reported as follows -

If adopted, the proposals could lead to -

Mounting pressure on United States companies to sell stock in their Canadian operations to Canadians.

Strong competition in the takeover game from a proposed Canadian Government owned investment company.

A stiff tax on any transaction in which Canadian interests were bought out by foreign investors.

In addition, legislation is proposed to make it easier for Canadians to invest in local companies and easier for Canadian families to keep privately held companies in the family from generation to generation.

The “ Herald “, having reported that, said -

The moves to cut and eventually reverse United States dominance of Canadian industry come at a time when Australian investment doors have been flown wide to United States and other foreign capital.

The Victorian Premier, Sir Henry Bolte, for instance, has just completed his fourth trip to the United States in eleven years in search of capital for Victoria’s industrial future. Canada seeks to repatriate foreign capital; Australia seeks to import it in everincreasing amounts.

Australian industries owned overseas pay less than half the rate of tax paid by locally owned Australian industries. Defence and developmental works and social services for our people are all restricted, but the taxes payable by Australians are increased by the failure of the foreign investor to pay adequate taxation. These and numerous other reasons should cause our Government to review the concessions to foreign governments. The hundreds of millions of dollars in taxation concessions tha: have gone into the pockets of investors such as those in General Motors-Holden’s Pty. Ltd. and other foreign firms should have been used to advance the security and development of Australia and the welfare of her people. 1 said previously that double taxation agreements have given investors in overseas companies, mainly in the United Kingdom and the United, concessions worth more than $180 million in about five years. That is an understatement of the worth of taxation concessions to foreign investors. The Government should issue a full and detailed statement of the advantages that are being reaped by foreign investors not only from companies but from investments of all kinds. During the next five years amounts payable overseas could easily be li times or double what they were between 1961 and 1965. Sir Henry Bolte, who already has given foreign companies additional concessions worth millions of dollars annually and who has been to America from time to time as an Australian Santa Claus, will probably continue to be a Santa Claus to foreign investors but will bi- unable lo give the people of Victoria a fair go. He will continue to ask the Commonwealth for more and more so that he can give more and more to the overseas investors. 1 can give further figures. The amount of investment income payable overseas by companies in Australia between 1953 and 1965 was §2,534 million. About $2,500 million of that amount would have been payable in countries with which Australia has double taxation agreements. The withholding tax on that amount would be $375 million. Had there been no concessions, it would have been twice as much. Is ii reasonable that shareholders in General Motors-Holden’s Pty. Ltd. and other companies that pay dividends of more than 100 per cent, should share in these concessions? Surely there should be some modification of Australia’s benevolence. If our Government is to continue to receive the same proportion of the earnings of this country in taxation, the bigger the proportion of the earnings that goes overseas becomes, the smaller the proportion going to resident Australians will be and the higher the rate of taxation payable by Australians must be. At present 30 per cent, of the earnings of companies is paid overseas. When 40, 50 or 60 per cent, of the earnings of companies is paid overseas, the burden on Australian earnings in the form of taxation becomes immense.

Not only should indiscriminate encouragement of all kinds of investment capital inflow not be given by taxation and other concessions, but capital inflow of many kinds should be discouraged by taxation- and other means. I have already pointed out what is happening in Canada. I now refer to statements in the “ Review of Australian Economic Development “, which is a business journal, on what other countries are doing to preserve control of their resources. They show that India is restricting the flow of capital; that Japan has drastic laws to regulate the flow of capital; that in the United Kingdom Treasury approval is required for takeovers by foreign companies; that New Zealand has recently enacted legislation requiring Treasury approval of takeovers by overseas companies; that both Holland and France require government approval for direct investment, and the latter requires local participation in mining and some other fields; that Brazil prohibits foreign investment in mining; and that so do numerous other countries. Only in Australia are we, to the detriment of our people, giving outrageous concessions to overseas companies. For example, if a man such as Rockefeller of New York has investments in Australia returning him 57,000 a year, he pays SI, 000 less tax on that amount than an Australian would pay or half as much as an investor in Japan. Germany or some other countries would pay. Is that in the interests of the people of Australia? I say emphatically that it is not.

In concluding my remarks I wish to quote the last paragraph of this document, which is published by the Committee for Economic Development of Australia, on which some of the biggest business firms in Australia are represented. It reads -

It is patently evident that a thorough examination by the Australian Government of its policy towards foreign capital is long overdue. Unless Australia throws off its inferiority complex and resolves to be master of its own economic destiny, it can never achieve the title of a great nation for which its resources are ample and to which its people aspire.


.- First of all, Mr. Deputy Speaker, I would like to congratulate the Treasurer (Mr. McMahon) on the presentation of his first Budget to this House. Although this Budget was presented at a difficult time, it was presented in the same confident and efficient manner in which the Treasurer has carried out the duties of every portfolio which he has filled during his term as a Minister. Before I go on to talk in general terms about the Budget, I would like to comment on some of the remarks made by the Leader of the Opposition (Mr. Calwell) last night. I think there is one point that the honorable gentleman made that is worth noting and I would give a great deal of support to the honorable gentleman’s remarks in this regard. He said that he would remind manufacturers that constant increases in the cost of the articles they produced necessarily meant that fewer of those articles were purchased by the public. So increased prices did not necessarily mean increased production. I shall have something more to say about that later. But I think it is worth a number of people giving a great deal of consideration to that line of thinking.

It may be argued that a wage increase will stimulate production and industry and keep up the purchasing power of the wage earners, but constant increases in the prices of goods rather destroy the benefit of wage increases. I believe that those who argue this matter could justifiably criticise certain sections of industry because they fail to give sufficient attention to the importance of endeavouring to keep costs down. I realise that there are some industries in a competitive market that have an urgent need to keep prices down to meet competition. But in some industries and in some sections of industry this is not so. I am sure that in some of these industries there is not sufficient attention given to the cost of production of the items produced. I want to emphasise that and I shall say something about it later. There is constant criticism of primary industry and it is said that primary industry is inefficient. As I have said before in this House on many occasions, the primary industries are among the most efficent in Australia.

The Leader of the Opposition last night spoke about the cost of the drought to primary industry. He said that the decline in farm incomes represented 1.5 per cent, of the gross national product. I point out that the repercussions of the drought go much further than just merely the industries or sections of industry that are affected by it. For example, reduction of production affects the freight loadings available to the railways. All this has a cumulative effect and the effects of the reduction in production extends through the whole of the economy. So we have to be very careful when we adopt a percentage basis in speaking of loss of production or of income in the primary industries. We cannot, as it were, regard the percentage loss of income within the industries directly affected as the end of the effects. As I have pointed out, the cumulative effects extend into many other sections of the economy and throughout the community.

The third point I want to comment on concerns the remarks of the Leader of the Opposition about the attitude of some Government supporters in regard to the relationship between the United Kingdom and the United States. I think that there is no validity in any of the remarks that the Leader of the Opposition made on this matter. Circumstances and conditions change and after 10, 15 or 20 years, attitudes and feelings about a government, a country or a situation may have been reversed. But this does not necessarily mean that there has been a change in basic opinion or in support for another government or country. Here again, we have to be careful, because a simple statement or comment does not necessarily express a basic fact. In the closing stages of the Second World War, naturally the government of the day in Australia laid emphasis on the situation in this area of the world. There was no difference of opinion on overall strategy, but only on individual aspects of the general strategy.

I now turn to the Budget speech made by the Treasurer. When one makes any comment on the Budget, one would do well to consider the Treasurer’s speech and the background that he outlined concerning the factors affecting this Budget. Early in his speech, he said -

Because the Commonwealth Budget appropriations are today so large and are so widespread in their effects, they must have a strong and pervasive influence on our economy during the days ahead. For this reason I want to speak to you first about the economic state of the nation and the outlook for the future.

I am reminded that when 1 entered this House some 14 years ago, the Budget of the day totalled about £1,000 million, or the equivalent of approximately 52,000 million in today’s currency. We are now dealing with a budget that totals better than two and a half times that sum. This demonstales the truth of the Treasurer’s words when he spoke about the complexities of the changing situation in our economy today. He dealt with it in these terms -

For five years now economic expansion has continued strongly although drought has taken toll in the past year. There have been many notable achievements: . . .

The right honorable gentleman went on to mention them. He continued -

The value of our exports last year - not itself the best of recent years- was $2,648,000,000; that is, 43 per cent, above that of five years ago. Our overseas reserves have been considerably strengthened. The pessimism in some quarters of a year ago has proved to be unjustified.

It is particularly interesting to note those figures, Sir. We have always stressed the value to the Australian economy of primary production. In a time of difficulty and drought, when, basically, all primary producers were facing tremendous difficulties, we were still able to achieve in total value - not, of course, in primary production alone - exports of $2,648 million, or 43 per cent, more than the level of five years ago. The primary producers made a tremendous contribution to this export total. This situation should remind us of the need to assist them.

Before discussing this particularly, I want to make a couple of general comments. Some time ago, I suggested the appointment of a committee composed of members from both sides of this House and from both Houses of the Parliament to consider automation. I still believe that this should be done. Automation will have a tremendous influence on life in Australia - not only economically but also socially. I do think that we need to give a tremendous amount of study and thought to this particular factor. I suggest that if a committee of members drawn from both sides of both Houses of the Parliament could look into this matter and have discussions with industry, the trade unions and all others vitally concerned, it could make a contribution that would be of value to the nation as a whole.

Coming to social service benefits, I congratulate the Treasurer and the Minister for Social Services (Mr. Sinclair) upon the increase of $1 in the general rate pension and upon the other increases that are being granted. However, I still think that this is not the answer to the problem, and I am sure that everyone agrees with me on that. I have suggested - and I think it is practicable - that there should be a sectionalising of pensioners, if I can put it that way. We know that there are pensioners living in metropolitan areas who are paying a great amount of rent for a room and who, because of this, find it extremely difficult to live on the social service benefit which they receive. People living in other areas where the rent for a room is not so high have some slight advantage in this direction. I realise, of course, that the Department of Social Services faced up to this problem when it granted supplementary assistance to those pensioners who are paying rent, but I still feel that pensions could be graded or scaled to a greater degree than they are so as to give some further benefit where the need is greatest. We have got to face up to this problem. To the person who is receiving superannuation payments and is still entitled to a full pension, the $1 increase is not the vital necessity that it is to the person who is in receipt of only the pension, the person who has no other income or assistance and is paying rent. Therefore, I suggest that this matter is really worth investigating with a view to seeing whether my suggestion can bc put into practice.

I come now to the primary producers, to those engaged in the dairy industry in particular. This industry is facing numerous problems, many of which are created by circumstances outside its own control. Last night, in a well reasoned and well presented speech on the Budget, my colleague the honorable member for Canning (Mr. Hallett) referred to the problems and difficulties confronting primary producers. I certainly was very glad to see provision made for payment of a subsidy on nitrogenous fertilisers. I had hoped that there would be an increase in the subsidy on superphosphate. Immediately I heard of the proposed increase in the price of superphosphate, I sent a telegram to the Minister for Primary Industry (Mr. Adermann) asking him to keep this point in mind when the Budget was being framed. I hope that at some time in the future something can be done to increase the subsidy on superphosphate.

Let me quote what was said by the Minister for Air (Mr. Howson), who represents in this House the Minister for Customs and Excise (Senator Anderson), when presenting the Phosphate Fertilisers Bounty Bill to this House. He stated -

Honorable members are well aware of the importance of fertilisers, especially phosphate fertilisers, for productivity and development in our primary industries. Australian soils are, generally, notably deficient in phosphorus. The bounty on phosphate fertilisers was introduced in August 1963 to stimulate the use of these fertilisers and to offer tangible cost benefits to primary producers. By comparison wilh the level of consumption in 1962-63, the usage of phosphate fertilisers has been expanded.

After referring to certain figures, he concluded by saying -

The continuation of the bounty is expected to encourage a consolidation of the trend towards increased usage of phosphate fertilisers. This legislation will empower a substantial level of expenditure, estimated at S28 million in the next twelve months, which will be of direct benefit to the farming community and major export earning industries of Australia.

The payment of a subsidy on nitrogenous fertilisers is another step towards assisting the primary producer, but surely, if the subsidy was given in the first place to encourage greater usage of superphosphate and if the price of superphosphate increases, we should endeavour as far as practicable to increase the subsidy so that the net cost to the man on the land who is using the fertiliser will remain the same. I submit that the case for increasing the subsidy becomes even stronger when we remember that the increase in the price of the article is due to circumstances outside the control of the primary producer. I repeat that the subsidy on superphosphate should be increased, and I would hope to see this benefit extended to the primary producer at a very early date.

I follow this up by pointing out that, whenever a benefit such as this is suggested, there is strong criticism of the primary industries. That criticism comes, in the main, from people who know nothing about primary industries and many of whom have never been into an area of primary production at all. Let me repeat something that I have said previously. I am continually amazed at the criticism that comes from people who are opposed to giving financial assistance to the primary producers, especially when I know that these same people are strong supporters of tariff protection. Let me make it perfectly clear again that we do not oppose tariff protection for secondary industries. We understand and appreciate that secondary industries are needed in this country and that, without secondary industries, the primary industries could be in difficulties. But, as I have said, I am constantly amazed to find that the strongest critics of giving any assistance to primary industries are those who are the strongest advocates of assisting secondary industries.

I have seen certain advertisements asking why a person should not be allowed to buy a certain article or a certain commodity. Let us follow the argument to its logical conclusion. The logical conclusion is that we should eliminate all tariff protection on certain articles so that the primary producer can buy those articles at the lowest possible price, and in this way keep his costs of production down. This shows just how illogical are those people who constantly advocate protection for secondary industries while not being prepared to give assistance to the man on the land who is faced with increasing costs resulting from the protection accorded secondary industry.

I do not think that the people engaged in primary industries should be asked to carry the full burden of the support enjoyed by secondary industries, but that is what some of those who strongly oppose assisting the primary producer are really asking for. If those people could see the primary producer in action they would appreciate the contribution he has made to the economy of this country and they would realise that, without him, our economy would not be on the strong foundation that it is today. T repeat that not enough thought or consideration is given to the primary producer by people in this quarter.

Following the matter further, I think more attention should be given to the provision of amenities for country people. For this reason, 1 am happy to see that an additional $21.5 million is to be made available to the Postmaster-General’s Department. The only worry I have is that, with increased costs, I do not know exactly how much of an increase in service this sum will provide. In regard to decentralisation ! feel that one way in which the Government would be able to help would be by reducing the cost of telephone services. I know that the Government has done a considerable amount in this regard, but by doing even more and by reducing the cost of telephones for people in country areas we could achieve much. To people in country areas telephones are no longer a luxury, they arc a necessity. Industries being established in country areas are at a disadvantage compared with industries established in metropolitan areas in the matter of telephones. I hope that in this regard we may be able to assist country areas with decentralisation through the Postmaster-General’s Department.

One of the major values of decentralisation is to sustain industry that we have already in those areas. One of the greatest factors in decentralisation is the dairy industry. There is an urgent need to sustain this industry. In my own electorate we are extremely fortunate in having two very strong industries which were started by people who had an appreciation of the value of coming out into the country areas. I hope that these industries and people with these desires to assist in the development of country areas will be given increased assistance.

I shall conclude by saying something about the war in Vietnam. 1 do not want to traverse the remarks that I made in this House in May in regard to the factors concerning our participation in Vietnam. Suffice it to say that I give my complete support to the Government in this direction. The Leader of the Opposition (Mr. Calwell) last night said that this was a bloody and a dirty war. 1 have said this, and I believe that we can say again, as my colleague the honorable member for Calare (Mr. England) said: What war is not? Nobody in his right senses ever desires to have war. But there are times when a nation faces a decision, when the freedom and security of that nation is threatened. It is at this time that we must be aware of not only the privilege of citizenship but also the responsibility of citizenship. Let me say with regard to the Joss of life in this war that no one person in this House can have greater regret than any other person in this House. To imply that any one member of this House would have less thought for the loss of li! a is to my mind an indictment of the person who would make that suggestion. I regret that this suggestion has been made on more than one occasion in this House. I should like to read an editorial which appeared in the Sydney “ Sun “ last Friday because I think this puts in fairly plain terms a certain thought which has some justification. The editorial states -

There is a suggestion that the A.L.P. is ready to put votes before angry idealism in the party’s policy on the Vietnam war.

It has been proposed in Federal Caucus that the party should change its loudly trumpeted pOliCy of bringing home without delay Australian Servicemen in Vietnam.

This policy was never practicable. The A.I-.P. should be commended if it abandons it for commonsense reasons.

The Caucus talks, however, suggest a political somersault as astonishing and cynical as the one recently performed on Sta’.e aid.

The Vietnam policy, formulated on May 12, was to be the A.L.P. ‘s ace of trumps at the forthcoming election.

Its abandonment for votes would shock many sincere people who oppose the Vietnam war. “The Sun” reluctantly supports this terrible war, but it respects those who honestly differ with it on this, and it deplores any party making conscription a vote-catching issue.

The Leader of the Federal Opposition, Mr. Calwell, has called it an evil American war.

Some of the A.L.P. warriors have found a change in the wind on the home front.

So, as they begin to fall in for the election parade, there is a feeling that it will be better to dress from the Right than the Left.

I would commend to members of the Opposition a study of that editorial. Let me say, as I said in May, that if this nation ever comes to a point where pressure groups are able to take away from the people of this Commonwealth a sense of responsibility not only to this Commonwealth but also to those who have made the sacrifice for us previously, then this nation will have lost the right in the truest and deepest sense to say that it is a nation and it will have lost the foundations of nationhood.

In this regard there are many things that we have to do about the situation in Vietnam. We must not concentrate merely upon the military. I would say that anybody who has studied the situation and has looked at the overall picture will realise that this Government is not concentrating merely upon the military; it is concentrating on giving assistance in every sphere to the people of South Vietnam. It is concentrating on giving assistance in every sphere in the Asian area and in other centres of the world through the United Nations and other bodies. I am proud to be a supporter of this Government which has faced its responsibility, even of having to commit this country to war. It is facing its responsibility to build on the foundations which will lift the standards of the people in the Asian area.


.- At the outset I should like to say that I do not think that anywhere in the world would there be a greater number of pressure groups than we have in Australia. They are one sided pressure groups into the bargain. Be that as it may, we on this side of the House are quite used to them. In the north where I come from we are quite used to them and they make no difference.

I support the amendment moved by the Leader of the Opposition (Mr. Calwell) to the motion that the Bill be now read a second time - in effect to what I would call this sit it out Budget. I feel that I should say what many people and most newspapers have said, that it is ultra-conservative in some respects and verges on rashness in others. It certainly is conservative when the social service aspects of it are considered. It does not give a fair go to those concerned. This has been said by me many times before and it has been said by others. I think the amount of the deficit for which the Treasurer (Mr. McMahon) has bud.getted in a time such as this can only indicate an intention to draw on the future.

I fail to see how this Government’s attitude to the means test can be justified. I refer particularly to that section related to the amount that a pensioner can earn. In a nation such as ours, any lost earning capacity is a loss to the nation and is re flected in the gross national product. In the last two or three years it has been quite easy to get work. Pensioners have been able to find work quite easily, but it is not so easy today because the rate of unemployment is creeping up. I do not think anyone would doubt that unemployment will go higher as things grind to a halt and become gummed up as they are in the community today. In the district from which I come there are many fitters and turners and other good tradesmen who a year or two ago were quite capable of working and who were willing to work when they were well enough, but because of the limits on earning it became no longer worth while for them to do so. If they worked they would lose their pension.

In a case where a wife was younger than 60 years a certificate was necessary for a wife’s allowance to be paid. It was virtually impossible for a pensioner to work because every time he ceased work he had to present a certificate to show total incapacity to enable his wife to receive an allowance. The pensioner who wanted to supplement his pension by doing work for odd days or weeks found that doctors would not repeatedly give him a certificate every time he ceased work. I suppose that is a matter of common sense. If the doctor were to do so there would be a reflection on his integrity as a medical man. I suppose that his feelings deserve to be considered like everyone else’s. It seems that every time a pensioner starts work his wife loses her allowance. Before she can get the allowance again he must go to a doctor and get another certificate. It certainly looks a bit odd when a man is declared to be totally incapacitated four or five times in one year. This has happened in Townsville on one or two occasions. I had almost to get down on my knees to get the doctor to give a certificate to the man so that his wife could go back on the allowance.

In my opinion, there should not be any qualifying age which the wife of an age pensioner must reach before she also receives the pension. Once a man qualifies for the age pension his wife should qualify automatically as well. I think that this is only a fair and commonsense approach to the problem. This is one of thi glaring anomalies of the Social Services Act which is improved from time to time but which falls far short of what is needed for normal living today. As most of us know - though some do not because they do not bother to look - these people live generally at a mere subsistence level in spite of what they have contributed to the economy of our nation over the many years of their lifetime. Many of them today who lived through the depression years and who are retired now or are about to retire were not in the race to amass any assets which some of the more fortunate ones now have to s.and by them in their old age. In those days they were lucky to rear a family and eat. We all know that that was nol a very good time in which to live.

Deserted wives in Queensland have a particularly bad time. I should like to present to the House the facts concerning the case of one woman. Her case is rather tragic. This sort of thing happens in Queensland because of the peculiar circumstances prevailing there, in Townsviile, recently, a young mother 26 years old was deserted by her husband, three weeks prior to the birth of her fifth child. The ages of her four other children were 6, 4, 3 and 1 year and 5 months. Shortly after the birth of her baby the woman had herself discharged from hospital because the child care plan had collapsed. She returned to the flat which the family had been occupying for some weeks. The weekly rent of §12 was in arrears because of the husband’s desertion.

For a number of weeks following the birth of the baby this woman and her children were totally indigent and kept in foodstuffs by the St. Vincent de Paul Society. The rent continued to be unpaid, and finally the woman received an eviction notice, this order to be executed on a fixed date. Until maintenance action was taken the woman was not entitled to even temporary and immediate assistance from any public source, including State relief from the Department of Labour and Industry. In Queensland, the Department of Labour and Industry dispenses some meagre relief to people in these particular circumstances, but until maintenance action is taken, this aid does not apply. As time progressed and the woman realised that her husband was making no effort to return and support her and her children, she approached a solicitor on her own initiative and asked for a maintenance order to be executed. She then made application for State aid, with the State Children Department, which was fairly promptly granted giving the woman $2.50 for each child - a total of $12.50 per week. Simultaneously, a request was made to the Department of Social Services for special benefit to sustain her until the required six months had lapsed before she was eligible for a deserted wife’s pension. This special benefit would have given the woman $8.25 for herself weekly and $1.50 for each child - an amount which might have staved off the eviction and enabled her to meet her daily expenses.

The Department of Social Services indicated that the special benefit could not be paid in Queensland to a woman in these circumstances - this special benefit is payable in, for example, Victoria to deserted women and children because Victoria has no State Relief Act - because the Queensland Government does provide temporary relief to its destitute citizens. However, it happens that the State relief now paid in Queensland is nowhere near the amount paid in special benefits by the Department of Social Services. The present rates for State relief, which are quite ridiculous are: Mother $2.65; first child $2.65; each subsequent child $1.15; milk allowance, per child $0.10. The total weekly amount payable in this case was therefore $10.40. This is the payment for a wife and five children which, as honorable members know, in the old currency amounts to £5 4s. Od.

Under the provisions of the State Relief Act this weekly relief to children is cancelled the moment State aid is paid to them by the State Children Department. This means that the only relief payable to the woman in question from the Department of Labour and Industry would be $2.60 per week. Apparently, this rate was established in the State Relief Act 1952, at which time the female basic wage was $13.32 per week, whereas the basic wage for women is now $24.55 per week. This Relief Act has not been amended over the last 14 years to cover the drastically increased cost of living nor has the 100 per cent, increase in the basic wage for women been reflected in increased payments made to destitute women. I mention these facts only because they are relevant to the case. This does not really concern the Federal Government.

The present situation is that the Federal Government will pay special benefit to destitute mothers and children only in States which do not have their own relief act. The special benefit rate paid by the Federal Government - $8.25 for the mother weekly and $1.50 for each child weekly - is a reasonable grant, but unfortunately Queensland mothers in destitute circumstances are now excluded from this benefit because of the pathetic amount they receive from the State. A great injustice to Queensland mothers and children thus exists because the State Government does not allow State relief to be paid to the children in conjunction with aid given by the State Children Department. Yet in cases where special benefit or the deserted wife pension is payable, the State aid is also allowable, the combination of which does enable a woman to have sufficient basic income to support herself and her children.

When this woman in desperation registered for employment with the Department of Labour and National Service in the hope of claiming unemployment benefit - the only form of Federal assistance immediately available to her - she was found work almost immediately. No doubt she was a willing partner in this plan, but this was largely because she had been without money in her pocket for almost four months. As I mentioned, the only outside help she had been given was rendered, in kind, in the form of foodstuffs by the St. Vincent de Paul Society. This woman was desperate enough to feel that this could not go on. Having registered for work she was expected to accept a job as soon as it was found for her and this she did. This has entailed this mother having to leave her young family, including the newborn baby. As she could not pay for accommodation she had to move in with a family and arrange for the children to be cared for by the woman of the house. This woman, the only one who answered her advertisement for emergency help, had three small children of her own and a small house. The child care plan quickly collapsed. In a case like this, it would seem that this married woman with five children should not be forced, by financial extremities, to seek outside work. She should have as much consideration given to her by the Federal Social Services Act as is given to a single expectant girl, who is allowed to register for unemployment benefit and yet not be put to work during her period of pregnancy.

The social philosophy which spares the unmarried pregnant girls from work and yet expects a mother of five young children, all under the age of six years, including a newborn’ baby, to have to accept work and to devise makeshift plans for her children, should be seriously questioned. There appear to be two possible lines of solution to anomalies present in governmental assistance in the State of Queensland to women and children in the category indicated above. The first is for the State Relief Act of the State of Queensland to be amended to give mothers and children within this State equivalent benefits to those granted6 by the Federal Government through the Department of Social Services to destitute mothers and children in other States where such a relief act does not exist. Of course, we know that the Queensland Government does not want to do that because, in common with other State Governments, it is short of money. The second line of solution is that the Federal Government should not be in a position where it is discriminating against women and children in destitute circumstances because they happen to live in States which are not providing equivalent material assistance which is payable to them by the Federal Government. T hope that the Minister for Social Services (Mr. Sinclair) will take notice of the case that I have mentioned. This does not happen once; it happens dozens of times.

There is another point with regard to pensions in relation to superannuation. This was mentioned, I think, by the honorable member for Lyne (Mr. Lucock). Superannuation is another thing with regard to social services that this Government generally should not feel really happy about. The average man spends his life, if he is in a firm which has a superannuation plan, paying into a superannuation fund to produce a pension which seems adequate but which by the time he draws it is not adequate. He loses the pension payment as well. What is perhaps more important is that he loses those medical and hospital benefits which a pensioner receives. In my opinion this is something that needs more than a glance from those people who are sitting in the buildings of Canberra surrounded by trees and not reality.

Last year in the Budget debate I spoke about an integrated defence force in this country. This was mentioned in the year before that, I think, by the honorable member for Franklin (Mr. Falkinder) during the Budget debate. In my opinion this is something that should be thought about. I said last year that this system was put into operation by the Canadian Government, which became quite alarmed at the huge percentage of non-effective defence spending. It is no use spending Si, 000 million on defence as we plan to do this year if we have nothing to show for it in the way of equipment. In my opinion we are in that position in this country. Not nearly enough money goes into the purchase of fighting equipment. By fighting equipment I do not mean huge cars or limousines or things like that to make life more pleasant for the top brass. By equipment I mean equipment that will kill or embarrass the enemy.

It takes very little imagination - I think most of us here realise this - to envisage that we are very weak in this respect. We have our old Sabre jets still going. These Sabre jets are about as old as my marriage and, I might add, they are in worse shape. Then we have the Mirage aircraft. These aircraft are still just so many aeroplanes and, as far as I am concerned, they are very nice aeroplanes and very sophisticated. They are as good as the world produces, but in my opinion they do not represent at present an effective arm of our defence force. Such sophisticated aeroplanes as these need highly sophisticated radar and the other technical aids which are necessary if we are to obtain the best performance from them. We know that there are only certain selected areas in which they can operate and I have grave doubts whether these are important. They are virtually useless in places such as Townsville. They can be sent there and they will fly around, but most people realise today that one of these aircraft cannot be sent charging out at the speed they attain looking for somebody, like a dog chasing a duck. They must be told where to go and at what height to fly. All this has to be done for the aircraft. It cannot be left to the human element any more. When I was in the Air Force, a cross was put on a map and we were told to go there. We went there and it may have taken nine hours or so. But in those days our aircraft had fuel to spare. Now aircraft do not have fuel to spare and unless they are used properly they are virtually useless. We have seen some improvements in the Navy in the last couple of years, and it could pass without unfavorable comment if one wished to be charitable. But our Army is still using the old 1941 model trucks that we saw in New Guinea and other areas during the last war and plenty of other antiquated gear. However, I will not comment on this.

With a single integrated defence force, we would have a single command. This would avoid massive duplication at. the top, such as we now have, and elimination of this duplication would flow down through the whole of the defence forces. We would no doubt have the same trouble as the Canadians have had, and are having, with the expendable types - we all believe that we are not expendable - trying valiantly to prove that they are not expendable. But eventually the nation would be better off with a single integrated defence force. There would be less duplication in both manpower and equipment. Today a radar technician or a helicopter pilot has virtually the same job, irrespective of the arm of the Service to which he belongs. This applies to most maintenance work as well. lt was estimated that in Canada such a move would release almost 10 per cent, of personnel from administrative work. They could be used to increase the active service personnel. However, 1 will speak about this when the defence estimates are before us and I will say no more at this stage. This is one way to get value for our money. I do not think we are getting value now, though this is not S-he fault of service personnel generally. I think our defence system, like a good deal of our economy, is gummed up by regulations and a good deal of red tape, sometimes in the guise of economy.

I would like to say a few words about the sugar industry in north Queensland. As honorable members know, this is perhaps our most important industry and it is in a bad way today. It is facing a crisis and this is through no fault of its own. 1 will not go into this aspect, because we could have quite an argument about it. Nevertheless, the crisis facing the industry is no fault of the growers. They were encouraged to go into it, they are in it and they are stuck in it. lt is up to the Government to get the industry out of its difficulties or at least to sustain it until the world price improves. I believe that it will improve inside two years and 1 do not think 1 am being over-optimistic. Sugar prices have been very low now for over a year and 1 think eventually when they start to climb they will climb rather more rapidly than we now expect.

The position has now been reached in sugar areas in which farmers, irrespective of whether they have been growing sugar for a long or a short period, are feeling the effects of the extremely low world price. The young farmer, or perhaps I should say the new grower, in most instances paid far too much for the land, because the picture looked so rosy with the high world price for sugar. However, the high cost of land and the high cost of capitalisation in the form of - implements and housing have caused difficulties for the farmers. The implements, including tractors, are a very expensive part of farming. They are not like a horse. In the old days, if we had two horses, one a he and one a she, we could finish up with three horses. But today if we start with two tractors we finish with two tractors, and it does not matter how long we keep them, except that they wear out and must be replaced. These are all parts of the problems that sugar farmers face today and the picture is black for them.

There is no doubt in my mind that cane farmers will be sold up for debt in the Herbert River area, the Burdekin River area and the Tully area, and they will walk off their farms. This has not happened in these areas since the early 1920’s, before the sugar industry was stabilised properly. Of course, there have been instances of difficulties being caused by the farmers themselves, but this happens in any industry. However, as I said, this crisis in various degrees is not confined to new growers. Many well established and comparatively well off farmers have to face up to finding themselves classed as bad risks by the trad ing banks. They cannot meet their commitments and their commitments are quite heavy. They have had to buy fertiliser, fuel and so on and they have had to pay thentaxes. Provisional tax has created problems for them, lt has made big inroads into their incomes. We all tend to spend a little more when things look good, and anyone who has been in business knows what sort of a good kick in the pants provisional tax can be following one good year. These people are in that position. Then they have the creeping cost of production, which includes the replacement of parts for the many and varied pieces of machinery and implements that 1 referred to earlier. Today, the modern sugar cane farm is heavily mechanised. Then there is the wages section of costs. This has forced many of these well and long established growers to run from one bank to another in the hope of getting finance to carry on.

There has been without a doubt a definite trend by one of the larger trading banks in north Queensland to pull out of the sugar areas completely. It is handing over all it can to the Commonwealth Trading Bank and in Tully it is virtually the Commonwealth Trading Bank that is bearing the brunt of this withdrawal of the commercial trading banks. I might add that the National Bank of Australasia Ltd. is giving some help. Apart from the effect on the farmers concerned, the situation of the sugar industry is having a detrimental effect on the morale of the whole district. It is not very uplifting in business to see what is happening to the sugar industry in the surrounding areas. The main bank in the district, as I have said, has virtually abandoned the industry as if it were in danger of immediate collapse. The sugar industry needs help amounting to at least $12 million. This is not really a large amount in comparison with the total amount that is really needed, and, if it is taken in the context of the amount sold overseas at the world price, it will be seen that it will still not return to the farmers the cost of production. Today, the cost of production is something over £30 a ton, but sugar on the world market is bringing £16 a ton. However, assistance of the nature I have mentioned will at least mean that those who are determined and willing to work will survive. Some of the farmers today are reduced to the level of cutting their own cane and doing their own work. This may be all right for the young men, but a man in his fifties cannot do it,

Mr Hansen:

– -Cain killed Abel.


– Cane killed more than Abel. However, not only the farmers will suffer from the bad state of the sugar industry. Associated industries and businesses and the people who work in them, as well as those who have money invested in them, will feel the pinch. This will not stop at the Queensland border. Many people who work thousands of miles away in the production of fertilisers, machinery, vehicles and so on will also be affected. This is not, as some people in the south seem to think, a case of propping up an inefficient industry in Queensland. It is a matter of assisting a very important contributor to the Australian economy, which through its own initiative has become one of the most efficient in the world. I know that the Queensland Government has finally come around to asking for money to help the sugar industry, and I hope the request does not go unheeded. I tried to ask a question on this subject today, but I did not get the call. However, I think the Government should recognise the difficulties of the people in the sugar industry.

Another sector of the economy today that needs consideration is the business sector. I think the Government should have had a little more consideration for the general business sector this year. The situation of the retail trade, according to my many friends who are lucky enough to be still in it, is anything but reassuring. I would have thought that this would have been obvious to the people who prepared the Budget and would have caused them to have done something to stimulate this section of the economy. Retail trade in Australia is slack at every level. When the average retailer today is asked how business is, he will say either “ bad “ or “ not bad “’. Rarely does he ever say “ good “. In this category, I do not include the huge chain stores which, through buying discounts alone, as we all know, can show a tremendous profit. I mean those normal retail establishments that must cover their overheads, which are continually climbing, show a trading profit and show a net profit. In the main they are owned and run by one person or a family or by a small private company. These people must handle the lines that the chain stores refuse to stock, such as the fashion lines or lines that entail extra overheads because of their nature.

The establishments of which I speak are being forced into a position that is more than awkward. They must carry accounts for customers, but the chain stores will not do this. They are forced to pay income tax on the amount of their sundry debtors, but cannot borrow against this item. I should think that the honorable member for Mitchell (Mr. Irwin) has had the experience of refusing an advance to a business man who has wanted to borrow on the basis of his sundry debtors. These small establishments do not enjoy the taxation advantages of other sections of the economy. This, of course, does not include the poor unfortunate retailers who are in the electrical business. They are faced with a year to year decline in demand and they carry a termendous percentage of the nation’s bad debts. Into this category we have seen creep the automotive industry, which is facing in almost every area the same conditions as faced the manufacturers and retailers of electrical goods in the years gone by. In my opinion, the motor industry will be in a similar position before many years have past. It is facing a run down in sales which seems to be continuous. The manager of one of Australia’s largest car selling organisations, handling our most popular make of car, told me that what we need is a war because at present he cannot show a profit on the sale of new cars. This is disturbing, bearing in mind the tremendous unused capacity in the motor industry. If there is unused capacity spread over the whole field of production it places a greater financial load on the goods produced and is inclined further to slow down the industry. The results of such a chain of events speak for themselves, as we have seen in the past.

In my opinion, the present state of the economy is, to a point, the result of last year’s Budget, which like the present Budget, did nothing to help but in its own way reduced consumer spending. This reduction in consumer spending is beginning to be manifest in the retail trade. As consumer spending slows down further the effects will be more widespread.

In the years that I have been in this place a Jot has been said about northern development. We have heard many speeches on the subject by honorable members. We also know that the Government lost the byelection in Dawson on the issue of northern development. This year I presume that provision for northern development is covered in the section of the Budget Speech headed “ Works, Housing and Development “. In his speech last Tuesday the Treasurer (Mr. McMahon) said -

Next, there is a long and fast increasing list of payments to the States for specific projects or classes of development work, lt includes land development,-

The Treasurer did not specify the kind of land development - forestry, water conservation and flood mitigation, roads, railways and ports.

No details of specific projects have been given. All we have had are generalities, and to me that always smells. It would be interesting to hear whether any flood mitigation work such as was mentioned is being carried out. The men on the land are more likely to be buying dust masks. The activities referred to by the Treasurer are estimated to cost this year $198,600,000 which is an increase of $12,900,000 on last year’s expenditure. The Treasurer stated that expenditure on railways under this heading would amount to $25 million. 1 do not think this money will be spent in Queensland unless it is on the small line from Gladstone to Moura and I do not think work on this line has progressed to this stage yet. The Treasurer said that expenditure on roads under this heading would amount to $157,700,000. I imagine that this expenditure will be in all States. Nothing is said of how much Queenslanders alone contribute by way of petrol tax. The amount to be spent on development of water resources is unspecified. On control of water resources $10,300,000 wil! be spent. That amount is less than $1 per head for the whole of Australia. Expenditure on land development and forestry will be $5 million. With the price of timber today at more than $20 per 300 super ft., $5 million does not amount to much in the way of timber plantings. Compared with our import bill of $200 million, the expenditure on forestry is trifling. The estimated expenditure for the entire Department of National Development is less than $29 million. Of that amount SI 3 million will be spent by the Bureau of Mineral Resources and more than S8 million by the Atomic Energy Commission. Little is left for expenditure elsewhere under the Department of National Development. The Northern Division of the Department of National Development was the Government’s brain child during the 1963 election campaign, but it has not yet got out of the cradle. The Division gets a pathetic $316,667 in this Budget. That amount is $51,000 less than was provided last year. This surely is an indication of the Government’s attitude towards northern development. No wonder the staff of this Cinderella section is giving up in disgust and going elsewhere. In saying that I do not refer to the honorable member for Dawson (Dr. Patterson).

The people of Herbert are not unaware of the Government’s attitude towards their part of the country. Despite all the rosy stories told by Ministers who popped in to see us during the recent recess and who made such a show wilh figures supplied by someone in Canberra, the fact remains that the ordinary working people of Townsville are, as a result of statements made by the Treasurer and the Prime Minister (Mr. Harold Holt), under no illusions as to who will foot the bill for the defence project in their area and the provision of extra water and sewerage mains. These things will cost the voters of Townsville plenty and in my opinion this is grossly unfair. I could have used even stronger words than those. The people who will reap little direct benefit, if any, from these defence establishments, which certainly are needed, should be told blandly that the Government will spend so much and that the responsibility for finding the rest will be the pigeon of the people of Townsville. The people should be told that if they do not find the money, that will be too bad.

This is not a fair crack of the whip. The Government should see that no-one is taxed extra in rates, as is happening in Townsville, because the Government is doing what it should be doing - establishing an adequate defence for northern Queensland. I have not even mentioned the mess in which our city roads will be with the heavy traffic that will use them. Even with normal traffic they fall to pieces after the wet season, and I am assuming that we will get another wet season. We have not had one of any consequence for five years. In heavy rain the roads go to pieces. What will happen to them when heavy Army vehicles use them will be a pity. I do not think the people of Townsville will overlook all of these things in the future.

Sitting suspended from 5.56 to 8 p.m.


.- Initially I should like to extend my congratulations to the Treasurer (Mr. McMahon) on the introduction of his first Budget. I am sure that many of us from both sides of the House, and particularly from this side, have been impressed with the grasp that the right honorable gentleman has shown already in this most important portfolio in recognising the interests of Australians in general. I congratulate him on his Budget, and in passing would comment that I believe he has received more telegrams from the ordinary people of Australia congratulating him on the Budget than possibly have been received for many years by Treasurers in the National Parliament.

Tonight I should like to refer to a matter I mentioned in the Budget debate last year. It revolves round the problem of centralisation of population and round the economic phrase “ diseconomy of scale “. I do not know whether to tie my remarks in to the lines in the Estimates relating to the Treasury or to those lines relating to national development, but either would be applicable. What is the position today? Almost 60 per cent, of Australia’s population is living in and around the major capital cities. This is probably not an exceptional situation in other countries, but the dangerous feature is that the trend is increasing here, frequently to the detriment of those involved in primary production. We have now reached the stage where just over 11 per cent, of our population is engaged in rural pursuits. It is true that there is a world trend to the location of industries near the market outlets. In other words, industries tend to be market orientated. Last year I dealt with this problem at some length and with the economic pull of more than one raw material in its involvement in an industrial process. Furthermore I mentioned at some length the useful description “ footloose industries “ - industries that owe no allegiance to economic laws in their location. I instanced industries manufacturing ball bearings, cameras, transistors and similar articles. These manufactures are valuable cargo and do not take up much space in a rail truck or semi-trailer.

Perhaps it is just as well at this stage to refer briefly to the problems associated with diseconomy of scale. Some weeks ago a planning authority told me that as cities develop to the stage where three way highways, as in Los Angeles, dual carriage highways and highly expensive parking facilities are required - involving the acquisition of land - the cost per person and the cost per car increases in geometric progression. If this is right, it is a serious matter for the future development of Australia. It is a subject on which we can learn lessons from other countries. Let me refer to the particular problems that occur. There are the problems of annual maintenance, of capital costs in providing overways, dual highways, arterial roads and acquiring land. These are very real problems in planning for a city like Sydney, and they are magnified when planning for a city larger than Sydney. Many workers in Sydney must spend up to 1 hour 25 minutes travelling to work and the same time returning home. This is about 3 hours each day that should be put to useful work in building our national resources or, alternatively, could be devoted to leisure. I make this point in relation to Sydney because I believe that Melbourne and Sydney have both reached the cross roads. At the risk of mixing metaphors, I suggest they have reached the stage where they are close to qualifying under the principle of diseconomy of scale. This means that, to provide the facilities for the people and for traffic, government is paying far more than it would pay if the people and the traffic were located elsewhere.

Mr Bridges-Maxwell:

– Who would want to live anywhere else but in Sydney or just north of Sydney, on the central coast?


– I have no doubt that a person living- in the electorate of Robertson would have attractions that would prevent his having any interest in another area. However, I believe this subject should be discussed on impersonal lines. America and other countries give examples of appalling government expenditure in order to cope with a situation that need not have existed had there been proper planning.

Let me refer to the various Australian States. In 1958 New South Wales introduced a Division of Industrial Development. Nowadays, even if it was not originally, it is a direct ministerial responsibility. Within the limits of its resources the Division has tried to attract industries away from the metropolitan area of Sydney. It has achieved some success. I understand that the present Minister and his departmental head are attempting to continue this work in New South Wales. In South Australia in 1964, under the Playford Government, a very good report was produced, and I may quote sections of it towards the end of my remarks; but, summarised, it suggested that industry will follow where extensive and valuable raw materials are found and that incentives in housing, power rebates, water rebates, land tax concessions and so forth, although they achieve some result, are no real answer to attracting industries to areas. This is the first report I have read that states categorically that the only method by which proper decentralisation can occur is by the fairly massive infusion of capital to a town, perhaps of 10,000 popula’ion, to overcome rapidly the teething problems of industrial expansion and to get the town’s population rapidly up to 40,000 or 50,000, al which stage the town can become self generating. Towns such as Shepparton, Geelong and many others that honorable members will be aware of have reached the stage of becoming self-generating. Service industries, consumer durable industries - these kinds of industries are attracted to towns of their size. This concept, of course, is very different from the old concept that State Governments, in my experience, have entertained for years, which has involved trying to wean an industry from a city and have it established in a country area, or alternatively, trying to compete with other State Governments to entice an industry to establish itself. Sometimes the competition is over-fierce - over-fierce for the national good - and I think this kind of exercise, although it has its value, is no real answer to the question of the future development of Australia.

South Australia did well under this old method, at least in areas in which good supplies of a raw material of some value were located. I might instance the development of Whyalla, with an extensive iron ore industry nearby. Then there are Mount Gambier, Port Augusta and Leigh Creek, all based on valuable reserves of raw materials. Under the Playford Government the Densley Report was prepared, which I think contained a lot of truth and had a lot of value, but the position today is that although the Opposition of those years fought at least one election campaign, if I remember rightly, on this kind of issue, it has done nothing at all in this direction since it became the Government of the State.

A similar situation exists in other States. Queensland and Western Australia, for instance, have all had some success under the old method of trying to establish an industry in a country town here or there, but there has been no continuing development. There is only one State that to my mind is looking intelligently at this problem. Let me refer to a newspaper article that appeared some time ago under the title “So Now It’s instant Cities”. This article was written by the Acting Chief Secretary of Victoria, Mr. Manson. In his article Mr. Manson demonstrates the kind of thinking that I like in approaching this problem. He acknowledges the job that must be done by the three arms of government, local government, State Governments and the Federal Government. He appreciates the fact that this old concept of decentralising, of trying to move one little industry here or there, is of no real value in overcoming the problem of population concentration around major cities. He mentioned 26 towns that the Victorian Government is evidently looking at carefully in order to get some assessment of growth potential. These towns are Ararat Bairnsdale, Ballarat. Benalla, Bendigo. Castlemaine, Colac, Echuca, Geelong, Hamilton, Horsham, the Latrobe Valley area in Gippsland, Maryborough, Mildura, Portland, Sale, Seymour. Shepparton. Stawell, Swan Hill, Traralgon. Wangaratta, Warragul, Warrnambool, Wodonga and Wonthaggi. From those 26 I hope, because I think Mr. Manson’s approach is intelligent, one or two towns will finally be selected that will be considered worthwhile for the expenditure of massive capital funds in order to build them up rapidly to the self-generating stage.

I like Mr. Manson’s approach to the problem, and as I spoke on this matter last year I thought it reasonable to comment on it once again this year. Many of the towns mentioned are known to me personally because I have driven through Victoria on many occasions.

The questions at this stage are, of course: What should we do to give effect to this principle? What should we do now to achieve the desired effect? I might sum up in this way: The principle is not that of the old-fashioned blind, unreasoned decentralisation that has occurred in the past on limited State funds. The principle is, 1 suggest, a calculated large infusion of capital to force population close to the 50,000 mark, at which stage a city should be selfgenerating.

Perhaps we should ask: Why should we act in this way? 1 suggest to this House that by investing now we can save the much greater expenditure that will be necessary to provide facilities for cities the size of Melbourne and Sydney if they grow to twice their present population. It would be an economic proposition if we could in the near future devise some alternative to these huge centres of population. I will ignore an argument that is frequently used and which involves the strategic necessity for both industry and for people to disperse from the larger cities. This is another subject in itself. What I am suggesting is that the three fields of government, local, State and Federal, should meet within the next few years to decide how best to select towns to become viable, self-generating economies.

Local government, I would suggest, should treat any new industries in the same way as South East Asian countries treat pioneer industries such as the joint AustralianThai dairy company. In those countries pioneer industries expect to receive and do receive certain remissions and rebates to enable them to overcome quickly the difficulties of early establishment. State Governments, I would suggest, should do the initial planning and inquiry work and should recommend to the Federal Government one town or more for special treatment. I feel that the State Governments should be responsible for the administration of the scheme, although this is obviously debatable. Once State Governments have made capital available, I suggest that the

Federal Government should subsidise this capital at the ratio of, say, 5 to 1. Only in this way will we get the kind of capital necessary to make such a scheme work. I believe strongly, as I think I have made quite plain, in the necessity for this kind of thinking.

In a recent newspaper report I saw that this year the value of greasy wool exports fell from $721 million to $708 million, the value of wheat exports fell this year from $297.2 million to $263 million, and the value of beef and veal exports declined from $200 million to $195 million. In other words, our primary industries this year have not produced the proportion of credits for our balance of payments accounts that they usually do. The reason for this, of course, has been the intrusion of drought conditions particularly in two States. I believe that it may take three years to retrieve the position. It takes a long time to restock areas after stock and breeding flocks have gone. But I believe that when the previous condition is reached again, which should be within three years, the suggestions that I am making tonight will be very relevant in the light of the larger returns that the country will be getting from these very areas that are now in a depressed condition. So I hope that in the ensuing year, or perhaps two years, agreement can be reached between the Federal and State Governments initially and between the three branches of government eventually as to whether this problem is worth tackling. I say that it is worth tackling. 1 have had time tonight to do no more than barely touch on the details and on the needs, but I believe that this Parliament must come to grips with the problem before we are engulfed with an avalanche of wasteful expenditure which will be necessary to cope with the diseconomy of scale that must appear in time to come if we sit back and take no notice. In my view it would amount to criminal neglect for all governments in Australia to prevaricate further. I do not blame this Government because I know of at least one portfolio in which a lot of work has been done on this problem, but we have allowed this matter to slip from our notice for 12 months or so. I hope that, inadvertently, the serious matter of the drought will give us the time to get geared to the proper implementation of this concept which I regard as being so vital to the balanced development of Australia generally. Today the States have not the resources to do other than fiddle around or juggle with incentives to try to attract a little industry here or there and to outcompete each other. As I think I said earlier, this has achieved little or nothing. I hope that various honorable members will see and appreciate the need and help to provide the drive that is necessary to implement at least the planning stage of the concept that I am putting forward tonight.

I have rather rushed through that section of my speech because I wished to have time tonight to deal, even if only briefly, with certain aspects of the 11 days that I was fortunate enough to have in South Vietnam a few weeks ago. I think it is fair to say that prior to the end of the last sessional period many of us on both sides of the House thought very seriously about a question which I would refer to as the Cairns line. The question is: Are we damaging our future, as we have to live in the area of South East Asia, by our involvement of troops in South Vietnam or, indeed, elsewhere? I believe that I am telling the truth when I say that I went to South Vietnam more worried about this point than about anything else. I should like to report briefly on my thinking on this matter now. Perhaps I have a suspicious nature, but I did not believe the stories that we heard over the last six months to the effect that the Australians were the greatest soldiers; that the Australians were the best behaved troops in these areas; and that the Australians, when they walked around the streets at night, were the only troops who behaved themselves properly. I found it rather hard to believe that those things could possibly be so.

If we ignore the question about whose troops are the best - one about which we are entitled to be parochial and on which we probably cannot make a good judgment - the first thing that really amazed me when I arrived in Vietnam was that I found that these vague generalisations were entirely accurate. Wherever I went I found a unanimity of expression along those lines. Even as an Australian walking around without being in uniform, if I was to say to the South Vietnamese “ Ukdaloy “ - which I hope means Australian, because I have heard of legs being pulled before - Immediately a happy grin came over their faces, whether they were in the city of Saigon or in the countryside. I cannot explain why this is so. I do not think many of us can. Perhaps Australians just are not faced with racial discrimination. Certainly, I think Australians talk readily to people whom they like, no matter who they are or what they are.

I suggest that the reason why Australian troops are just about the best ambassadors we could have overseas today lies between that line of thought and the line of thought that wherever I go I find that leaders of nations say that they can trust Australians and Australia. They say that because they appreciate that Australia is a small country which is in Vietnam not for territorial expansion or any increase in trade but for a genuine reason. By and large, people like someone who makes up his mind and says what he thinks. I noticed in going through South East Asia, for instance, that frequently there is not much admiration for the position of Japan in the United Nations, for the simple reason that it very rarely votes on an issue. I suggest that even in this House we have not much time for the fence sitter. I believe that the nations of South East Asia - even China itself - certainly will not mind a country like Australia having the good old fashioned guts to make up its mind and get on with the job as it sees fit.

In regard to nations outside South Vietnam, I make this comment: The neutralist countries of last year are certainly not the neutralist countries of this year. They might still be travelling under the neutralist flag; but their leaders, their ministers and their businessmen are not talking as citizens of neutralist countries today. I believe that the reason for that, quite simply, is this - and all of us probably thought this way over the last five years: For the first time for half a decade or perhaps longer they can now see a practical alternative to being overrun or economically dominated by China. I do not know whether in their minds it is more important that they should not be overrun by Communist China than that they should not be overrun by the Chinese. But, when the United States put its foot down firmly on the expansionary efforts of Communism in the South Vietnam area and was joined militarily by six other countries and in various capacities, all told, by 33 other countries, it gave the people of South East Asia the first practical alternative that they have ever had to Communism. They had accepted, as you and I had, Mr. Deputy Speaker, the fact that ultimately this area would be dominated by Communists, Communist Chinese or Chinese, depending on how one wants to look at the situation. So I point out firmly that this was a very striking opinion that I picked up in as many cross-sections of society as I could locate in 1 1 days in South Vietnam and another 16 or 17 days in the countries surrounding that area.

When we look at the economic grounds, perhaps it is an even more interesting story. I am quite certain that over the years capital and savings have been smuggled out of these countries illegally. If the people concerned were rich Chinese traders, they invested illegally in a safe investment area in Taiwan. If they were a bit smaller, they sent their savings to banks in Hong Kong, and frequently to the Red banks. If capital did go to the Red banks, this hard currency was used immediately back in the country of origin of the capital. If the people concerned were smaller still, they tucked their surplus cash under their pillows, if they had pillows.

I find - and I think my opinions are accurate - that in these days these three processes have ceased almost entirely. It is too early to say that there will be an upward trend in the future, although I trust that that will bc so. However, 1 am certain that today these three processes have almost ceased is correct. I expect in the future a great trend towards confidence in all of these areas, from the point of view of investment. From Australia’s point of view, what could be better than that the people of these countries should have enough confidence to invest in their own area? We have to live with them in this area. I can think of no single fact that is more important than that these countries should expand their economies, that they should have capital to invest and that they should have, if the want it - I hope that this will take place - the ability to attract outside investment in addition to their own. I will leave my comments at that point.

Let me say in conclusion that I deeply ad mire the speech made by the honorable member for Bradfield (Mr. Turner) last

Thursday night. I think along exactly the same lines as he expressed when he said that the thinking of Field Marshal Giap, or General Giap, or whatever he is, and, indeed, all the thinking of these nations, is pointed today to the resolution or lack of it in a democracy. They feel that the mere existence of democracy allows the building up of a force of reaction opposed to any government that may be involved in an exercise of this sort. They feel that if they play for time the tide of democratic reaction will run against the United States of America, Australia, the Philippines and any other democratic nation involved in the area. I believe it is highly important that members of this Parliament explain to people throughout this country that we need resolution and a measure of courage and intelligent thinking to back up the Australian Government in its involvement of this country in South Vietnam. Obviously, we cannot be let down on the civilian side–


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


.- I listened with interest to the speech just made by the honorable member for Angas (Mr. Giles). I cannot go along with him in the meed of praise that he bestowed on the Treasurer (Mr. McMahon) on the presentation of his first Budget. But I go along with him very strongly in his concept of decentralisation for Australia. It is pleasing to see a supporter of the Government advancing these views. This question of decentralisation has been raised in this House on many occasions by Opposition members in questions and in speeches. We feel that with the ever present threat of atomic warfare hovering over our heads daily, the need for decentralisation in this country becomes more urgent every day. T congratulate the honorable member, who is a Government supporter, on supporting on this occasion the views of the Opposition. I hope he continues to do so and that we shall see some advance in decentralisation. In the 17 years in which this Government has been in office, it has never displayed the remotest interest in decentralisation in Australia.

Mr. Deputy Speaker, I support the amendment moved by the Leader of the

Opposition (Mr. Calwell) who censured the Government for its failure to make adequate provision for housing, health, child endowment, education and northern development. The Treasurer, in his Budget speech, said that within limits the Government wants this Budget to be expansionary. But what the Treasurer has failed to tell us are the limits of expansion that the Government desires. In fact, the Treasurer placed great stress on the defence expenditure provided for in the Budget. But he overlooked entirely the fact that the best defence that any country can have is a satisfied community. It is true to say that the reaction to this middling, muddling Budget has not been one of satisfaction in any section of the community. The Government should realise also that we cannot have expansion unless we encourage expansion. Timidity on the part of a government produces timidity of expansion, however urgent expansion may be.

The Treasurer acknowledges the extent of our economic problems but fails to realise that the economic problems that plague this country at present are the outcome of the policies and the previous Budgets of this Government. The present Budget, once again, exhibits the inability of this Government to present a budget that is a truly national one. The present Budget shows clearly that the Government fails to realise that the greatest need of the Australian people today is for economic security and social justice. The Minister for Labour and National Service (Mr. Bury) places great stress on full employment. So, too, do the Australian Labour Party and the trade union movement of Australia. But what the Minister does not know, or pretends not to know, is that in order to meet the economic circumstances into which they have been forced by the policies of this Government, more than 30 per cent, of the people of this affluent nation have been compelled to take two jobs. Referring to full employment, the Minister said -

In spite of the balanced current situation, the supply of most skilled tradesmen is still inadequate to meet the demand. At the end of July 1966 there were almost as many vacancies for building tradesmen as there were tradesmen registered in these trades. In the metal and electrical trades, six vacancies were registered for every tradesman registered.

The Minister expresses concern at the shortage of these tradesmen, the national value of whom it would be hard to estimate. Yet the same Minister supports the policy that conscripts 20 year old boys - our tradesmen, scientists and technicians of the future - to fight and die in the swamps and jungles of South Vietnam in a war that was lost before it was started.

There is one feature of the economic policies of this Government on which all will agree, particularly in relation to its activities over the past 10 years. One would almost be disappointed if one were to pick up a newspaper one morning and find that the headlines did not indicate a crisis of some kind in our community. These headlines could be described almost as familiar faces, in a phrase that was often used by a former Prime Minister. We all aTe familiar with headlines such as “ Crisis in Education “. I see in the news this morning that teachers in Victoria and Queensland are considering going on strike. We all recall headlines such as “ Crisis in Education “, “ Crisis in Hospital Finances “, “ Crisis in Defence “, “ Crisis in the Future Growth of the Economy “, “ Crisis in Northern Development “ Crisis in Shipping Freights “, “ Crisis in Road Construction “. Crises .in all these fields are apparent and have been made apparent to us every day in newspapers and other journals. Under the headline, “ Victorian Government Bankrupt “, we read a report stating that this was said by Sir Henry Bolte and that he regards the Treasurer’s inability to understand arithmetic as the cause. But the Treasurer quietly tells Sir Henry: “ So, too, are we bankrupt financially, physically and mentally, but do not tell anybody; we are the only ones that know “. I say: You’re telling me!

Could anything be more degrading, not only in the eyes of the Australian public but also in the eyes of people all over the world, Mr. Deputy Speaker? This is the sort of image that the present Government has created after 17 years of the most bounteous seasons that this country has known, apart from the recent drought. Our mineral resources are the world’s greatest. We have oil and natural gas in an abundance as great as any country could wish for. Yet governments go bankrupt. Because of the present Commonwealth Government’s inactivity, the people of Victoria are compelled to pay 25 per cent, more in hospital fees. All the things that I have mentioned are an indictment on the bankrup; planning of this Government. Indeed, the whole sorry mess represents a blot on the history of Australia.

  1. now wish to deal briefly with roads. I could speak at considerable length about the national responsibility for roads and the defence aspects o. road construction. If I wished, 1 could discuss that most silent of all silent .services in Australia - the Commonwealth Bureau of Roads. However, I sh..ll content myself with saying that when this Government talks of expansion and its desire to limit expansion, we can lake as an indication of how limited our expansion has been under its administration the fact that in this motorised age only 14 per cent, of the road surface throughout the country is sealed. In addition, for years there has been a national demand in Australia for the co-ordination of all types of transport - water, air, rail and road - but, in spite of this incessant demand, the Government refuses to take any action on this most important feature, which exercises so much influence on expansion in the economy and so much effect on the economics of the community; an effect which reaches right down to the very hearthstone of every citizen in this community. “ Defence is the keynote of the Budget,” said the Treasurer, yet in all the years this Government has held office it has done nothing about establishing an Australian overseas shipping line, although such a shipping line is considered by most countries to be one of the most essential features of any defence programme. “ The annual freight on Australia’s exports and imports has climbed to a staggering $600 million,” said the Minister for Trade and Industry (Mr. McEwen) in May of this year, but the Government has taken no action to rectify this tremendous national matter which is having such a terrific effect on the economy of this country. I ask: Does the Treasurer’s expansion limitation exclude the removal of this colossal financial burden from the shoulders of the people of Australia? If I am any judge, the slogan of this Government will still be: “ All Care and No Responsibility “. The Government has the great capacity of being able to put off until tomorrow that which it should do today. 1 come now to housing. In spite of repeated demands, the Government has never made any sincere attempt to solve our housing problems. It has allowed the financial sharks of this country to exploit without restraint thousands of house hungry people through extortionate interest rates. Indeed, the Government has allowed this wretched usury to proceed apace and to reach almost criminal proportions. It has done nothing to check the rising costs of home building. “ We will make some injections of credit into the home building industry says the Government, but the money available will build fewer homes, due to increased costs. So much for the Government’s tender concern in that regard. Perhaps home building does not mean expansion to the Treasurer. Or are the inactivity and lack of realism of the Government in this regard two more of the planks in the Treasurer’s limited expansion policy?

I refer now to the refusal of the Government to lift the payroll tax on municipalities, and I want to mention in particular the cities of Williamstown, Footscray and Sunshine in my electorate. In Williamstown in particular, 14 per cent, of the municipal area is taken up by Commonwealth Government property. Footscray and Sunshine would be affected to a similar degree. Payroll tax would cost each of these councils approximately §13,000 annually. The rates lost by the presence of Commonwealth Government property in their districts would approximate $50,000 a year. But in spite of this injustice, of which the Treasurer is well aware, the Government refuses to relieve the councils of payroll tax. The ratepayers there, like other ratepayers throughout the Commonwealth, must bear the burden of further indirect taxation because of the refusal of the Government to relieve municipalities of that tax.

I come now to pensioners and I will read a letter that was sent to me by a pensioner. I would think that a similar letter has been sent to each and every other member of this Parliament. This one is addressed to me and says -

The many pensioners in your electorate are anxiously awaiting the imminent Federal Budget. With each rise in living costs the position of the old and sick becomes more desperate. In our later working years we had often looked forward to what is often termed “ the quiet evening of our lives “ with optimistic anticipation of frugal comfort and the enjoyment of the interests that passing years had fostered.

The harsh reality of a life in which we are priced out of all except bare necessities has given us a new and bitter understanding of what we can do without when we have no other course open to us.

This same harsh reality tends to make us think directly and simply, stripping off the wrappings that so often hide truth. Many of us feel that keeping old and sick Australians at a reasonable standard of comfort is a better use of our National Income than killing people in areas outside Australia.

If this seems unpatriotic to the well-fed, wellclothed and well-housed citizens, we point out that want and poverty make poor soil in which to nurture a fervent spirit of national devotion.

Old-age pensioners comprise the generation whose hard work and ability built our thriving industries, and supplied the service men and women to safeguard this source of wealth from enemy capture. Is it surprising if we tend to become cynical when we compare our meagre share in the country with the lifelong struggles we made for its welfare?

Each year at Budget time we have asked, with deep anxiety mixed with a little hope, for some consideration in this wealthy country of ours. To our recurrent disappointments have been added humiliating rebuffs with scant leaven of courtesy. Hope dies quickly with the old, for our past is long, and our future too short for promises to have any meaning unless they are fulfilled quickly and wth adequate measure.

This letter typifies in no uncertain manner the feelings of thousands of pensioners. Hope of any relief, of any real help from this Government, has long since faded. Limited expansion of social service payments is the answer to their ever-expanding cry for justice. The ever increasing cost of living makes this limited expansion policy of the Government more limited every day and in every way for the pleading pensioner.

I want to refer now to another matter which affects elderly people. I will read a letter sent to me, and most probably to all other members of Parliament, by the Superannuated Commonwealth Officers’ Association. It reads -

The Federal President of the Superannuated Commonwealth Officers’ Association, of which I am a member, sent a letter to the Federal Treasurer, the Hon. W. McMahon, M.P., on 9th March 1966, asking that provision be made in this year’s Budget for an increase in superannuation pensions on what is known as the “ notional salary” basis.

The last such increase was made in 1963 and took into account general salary increases up to 12th July 1961. Since then there have been further general salary increases as follows: -

When this method of adjustment was first introduced in 1961 the then Treasurer, the Right Hon. Harold Holt, M.P., indicated that it would provide a fair basis for further adjustments in later years. He subsequently described the method as “ the fairest yet devised”.

The Association’s request is that a further adjustment of superannuation pensions be made later this year to take account of all general salary increases up to at least 31st December 1965. May I ask, Sir, that you will be good enough to give this request your support.

The letter goes on to mention the Consumer Price Index, but already I have to tell the person who sent me this letter that the Government has refused to recognise the justice of his claim and will not do anything about superannuation. This is another classic example of the effect that the economic policies of this Government have had on people with fixed incomes. For them, there is no escape, and the Government refuses to give them any aid.

Some indication of the difficulties of pensioners and others on fixed incomes can be seen from these figures: In 1948, the year before this Government took office, 1 lb. of steak could be bought for ls. lid. Today the cost is $1 and more, according to quality. In 1948, the price of a lamb chop was 6d. Today it is 15c. In 1948 potatoes were priced at 3s. 6d. for 28 lb.; today the price is $2 to $4 for 28 lb., according to quality. Butter in 1948 was ls. lOd. a lb.; today it is 48 to 50 cents.

Mr Jess:

– It was rationed.


– Eggs in 1948 were 3s. a dozen whereas today they are 69c. Butter is rationed today too for many people who have not the money to buy it. In 1948 the basic wage was £5 14s. whereas today it stands at S32.80. Figures will show that prices have risen from 7 to 40 times, whilst over the same period the basic wage has increased by only 3i times. A brick veneer three-bedroom cottage could be bought for approximately £1,000 in 1948; today it would be hard to secure one for $12,000. The average rates on this type of property in 1948 was about £5; today it is in the vicinity of S80. Add to these increases the income tax increases imposed by this Government since it took office and then, for good measure, dump in increased train and tram fares, phone calls, bread, petrol, newspapers - indeed, almost every commodity that goes into the household - and one has some idea of the burden that pensioners and those on fixed incomes have had to suffer and are still suffering at the hands of this Government.

The Australian Council of Trade Unions fights for an increase in the basic wage and, by reason of the force of its argument and the validity of the case it presents, an increase is granted. The advantage, however, is short lived for prices are increased to an extent that takes from the people the increase they have been granted. Whilst this system of things is allowed to occur, profits continue to soar unchecked. My colleague the honorable member for Blaxland (Mr. E. James Harrison) has spoken at length on these matters. The honorable member for Melbourne Ports (Mr. Crean) in his speech to the House last night indicated quite clearly the erosion that has taken place in the pay envelope of the worker due to the policies of thi3 Government. In fact, a study of industrial events since 1949, the time when this Government took office, will reveal the insidious attacks that have been made on the living standards of the people by the employer organisations. These attacks have been to a very large degree aided and abetted by this Government.

I ask: Can the people and the unions have any faith in a government or a tribunal which goes beyond its statutory role of preventing and settling industrial disputes on the merits of the evidence before it? Can the people have any faith in a government or tribunal that sets itself up as an economic regulator of the people’s pay envelope? Can the people - especially those on fixed incomes - have any faith in decisions based largely on personal assessments and opinions? The Opposition agrees that good budgets can, in themselves, be splendid economic regulators, but the economic regulator must have special regard to the wage earners, pensioners and all other who do not have the right to adjust their own incomes. This Budget, however, is not a good budget. It is condemned because of its failure to correct the injustices to which I have referred. The amendment moved by the Leader of the Opposition confirms this. This amendment has met with the approval of all concerned. It was deficiencies of the kind referred to in the amendment and the injustices they contained which motivated the A.C.T.U. to bring down the wage policy of 1965, the substance of which I now present. It says -

The majority judgment in the 1965 national wages case is completely repugnant to Congress which pledges the resources of the trade union movement to securing its rejection at the earliest possible opportunity. Congress therefore endorses the immediate action taken by the Executive to secure a review of that judgment, within the arbitration system, and, upon the failure of that approach its subsequent decision to co-ordinate trade union activity directed towards that end.

Congress rejects the majority judgment because it conflicts iti three respects with fundamental trade union policy. First, in abandoning the principles of adjustment of prices and productivity, the judgment deliberately imposes a reduction in real award standards while specifically recognising that the real capacity of the national economy has increased. Second, the judgment does this because it assumes for the Arbitration Commission the role of economic regulator, which is the responsibility of the Government. In assuming this role and attempting the impossible task of achieving price stability the Commission has evaded its function of settling industrial disputes - its only function under the Constitution and legislation which creates the tribunal. Congress, in accord with its general economic policy, supports the regulation in the public interest of claims upon the community’s economic resources. Regulation of wages alone - as at present - is completely unacceptable because it is inequitable and, in any event as experience since the judgment has shown, is incapable of achieving price stability. Third, the judgment in ignoring the fundamental importance in proper wage levels of the basic wage has adjusted margins on unsound principles, without requiring detailed submissions from the parties and (for the first time in the history of the tribunal) in the absence of a Commissioner.

The document goes on at length. It informs us as follows -

The basic wage remains an integral part of an equitable and sound wage system in the Australian community. Congress re-affirms that such a basic wage “ must provide as a minimum for the reasonable needs of a married wage earner and his family; what are reasonable needs being determined from time to time in the light of standards generally accepted in progressive communities and the social aspirations of the Australian people”.

I venture to say that it does. Congress brought down other resolutions, but I should like to conclude on this note.

Mr Jess:

– Hear, hear


– I know that the honorable member likes to hear these things come to an end because .they probe too deeply into the conscience of Government supporters. The determination and the antagonism that the resolutions of the A.C.T.U. convey are purely the result of this Government’s interference in wages cases. Indeed the resolve and the expressions of the A.C.T.U. are born out of the injustices committed on the trade union movement and the people of this nation since the days when this Government first took office. They are injustices which the trade union movement and the people of Australia can no longer tolerate. They are injustices which an Australian Labour Party Government will quickly remove.

Minister for Defence · Paterson · LP

– In his address on the Budget last night the Leader of the Opposition (Mr. Calwell) opened with some remarks which I lightly paraphrase to say: This is the first Budget of the Treasurer (Mr. McMahon). His performance and the content of the Budget are so unsatisfactory that it must assuredly be his last. I should like to return the compliment’ from this side of the House as I observe that the Leader of the Opposition has said that he will retire from the leadership of his Party if defeated at the coming election. Consequently this is likely to be the last Budget which the Leader of the Opposition will deal with in that capacity. We will regret this event quite a bit, but we will cherish him for a little longer.

It has been said that defence dominates the Budget. I have noticed, of course, that $1,000 million for defence represents 17 per cent, of the Budget cost. It represents also a 34 per cent, increase on the 1965-66 figure. But it leads me to note that under other heads of Budget expenditure $926 million or 16 per cent, is for the support of the States and $1,269 million or 21 per cent, is in terms of social services and repatriation benefits, regardless of what is said about this. When one compares the Budget of 1951-52 with that of the present day it is to note that with the exception of war service land settlement, which is a declining activity, and debt charges, which simply measure the difficulties of finance these days, there is not one figure under a major head of expenditure which is not rising steadily and significantly.

This year, of course, loans are more difficult. The inflow of finance from overseas is curtailed to some extent by the financial problems of the countries from which major inflow occurs - the United Kingdom and the United States of America. In regretting that no taxation reductions are possible the Treasurer has said some quite wise words. He said -

It is the price we pay for growth and for security; but it is also a warning that, as a nation of fewer than 12 million people with a continent to develop, we face strict limits on the commitments we can and should accept. To attempt more would be to over-stretch our resources and capacities and bring on a chaotic state of things which could only serve to weaken our efforts and defeat our larger purposes.

So I think we can look forward to a period when there will be considerable inflexibility in future Budgets.

The deficit of $275 million written into this Budget is, I think, a measure of a good deal of courage. We will understand that this figure cannot be repeated. All in all, the Treasurer has done very well. Meanwhile, the Government continues to encourage these factors of growth in the community - oil, minerals, the development of trade and the underwriting of State projects. All of these things go on. If the charge is one of “ not enough “, as I have heard from the Opposition, then I think that, we had better settle down to the fact that there will never be enough of developmental moneys in this country while 12 million people inherit 3 million square miles.

The honorable member for Gellibrand (Mr. Mclvor) who spoke before me said something about wage fixing. The Leader of the Opposition in his address directed attention to the cynicism which has developed, but not generally I must admit, about wage fixing. The Leader of the Opposition says that wages are rigidly fixed at a rate the Government intends. Now, the Government has nothing to do with this matter apart from providing statistics. A statement of this kind from the mouth of the Leader of the Opposition amounts to contempt of the Commonwealth Conciliation and Arbitration Commission. The Opposition apparently has never learnt that if wages are increased costs are increased also. Industry no longer has the capacity to absorb increasing wage costs without their reflection into prices. What we need in this country is a great leap forward in productivity. Yet it is in this field that we find opposition from the Labour; Party, which fears automation in all of its forms. But when we. look round the modern technological world and note the enormous development, progress and prosperity in Europe and the United States of America over the last 10 or 15 years, we note at the same time that there has been a tremendous move to automation. Quite clearly we can have automation without serious ill effects reflecting into the civilian community.

Labour answers this situation, of course, with the same old negative Labour thinking. Labour offers a referendum which would result, if passed, in price fixing. We would be back to 1945. The Labour Party seems to believe that a new generation has come up to power in this country since 1945, a generation that does not recall the black market, under, the counter trading and the fact that goods were either forced off the market altogether or were available only at exorbitant prices - all the result of a foolish and useless attempt at price fixing. The United Kingdom has learnt the very unpalatable lesson that price fixing on ils own, without wage fixing, will not work. This the Labour Party in Australia will not face up to. If we are to avoid the problems in this field we want to lend more support to the spirit of this Budget.

The Leader of the Opposition went on to make a quite incredible statement that, I am sure, left the House wondering. He said -

For psychological, rather than economic reasons, $1,000 million sounds a much greater sum than £500 million would have sounded.

What is the motive of the Leader of the Opposition in mixing his currencies? Does the honorable gentleman really want to mislead the House and the Australian people, or docs he not recall that we have changed to decimal currency? It is true that the figure of Si, 000 million for defence in the Budget for this year is a good round figure. We did not arrive at the precise $1,000 million by totting up the cost of ail the things that we wanted. We arrived at that figure by a process of cutting quite considerably from those things which, because of the changing nature of the strategic situation, could be downgraded in priority. Some matters have been deferred. My colleagues of the Services perhaps will deal with these points. Certain matters have been brought forward; but, leaving aside only for the moment the Vietnam war, the Budget takes note of the vast change of our sphere of interest.

I turn here to a quotation from a book written by the Leader of the Opposition which is entitled “ Labour’s Role in Modern Society “. I hope that he will permit me lo quote from this book. The distinguished author says this -

For so much of our history, events in Europe lacked precise reality for us because they occurred so far away from our shores; and the cloak of British power, made manifest by the British Navy, wa’s our protection against invasion. All that is now changed.

But the entry of the Japanese into World War 11 thrust us into the storm-centre of a life-and-death struggle. We survived the struggle and, indeed, emerged stronger and more mature from it and because of it.

However, the world of 1945 was not the world of 1939, and developments in every part of the globe since then have borne in upon us the realization that Australia, though never more isolated politically, has never been less likely to be left alone than it is today.

Those are words of the Leader of the Opposition. I hope that I did not take any of them out of context. But the Leader of the Opposition fails to follow through. He denies in the face of his own words the possibility that there could be another threat from Asia to the future security of this country.

What we have done in defence is the result of study and forward-looking planning. We have provided new and powerful arms for all the Services, so that manpower is no longer the measure of our defence authority. We have come freshly from talks with the Secretary of State for Defence of the United Kingdom, dealing with the enormously vexed problems of a British presence east of Suez. We have noted the British White Paper on defence, which undertakes that Britain will stay in its bases in the Far East while the terms of its occupancy of those bases make occupancy COn.tinuingly meaningful. We have noted the growing importance of the Indian Ocean. We have noted the American assessment of that growth; we have the establishment of the signal station at North West Cape. As the Prime Minister announced this afternoon, we have decided that it would be a prudent piece of contingency thinking to have a feasibility study on the development of a naval facility in Western Australia, to meet the possibility that the interests of this country may need to be defended on either of two oceans.

We well understand in this country that the Leader of the Opposition and the Labour Party are opposed to the Vietnam war. The Leader of the Opposition says it is an unwinnable war. But the Deputy Leader of the Opposition (Mr. Whitlam), fresh from an on the spot inspection over a wide area in South East Asia, and particularly Vietnam, says that it is quite likely that the military side of the operation can be concluded in perhaps two years. The Vietnam war is a different kind of war from any in which we have been involved before. It is not a war for territory. It is not a war, as far as we are concerned, to destroy or occupy any country. This is a war for the control of minds and ideas. It is an ideological war. It is the first war in which soldiers have gone into battle with a rifle in one hand and in the other the tools and material for the restoration of a broken down civilian economy. Our men are both soldiers and civic builders at the same time. After all, this is what the whole war is about - to bring to South East Asia, and in particular at this moment to the people of Vietnam, the right to develop their country and their system politically and economically in peace and security.

But the Labour Party will have none of this, lt wants somebody else to do the fighting and, when the fighting is over, it will be pleased to come in and do the patching up. Labour wants us, as the Leader of the Opposition says, to follow our own independent foreign policy. The fact is that our involvement in Vietnam is our own independent foreign policy, lt is not less so because it is confirmed by the presence in that area of the United States, which possibly has a vastly smaller interest in the area than we in Australia have. Does Labour want to say that we should deny this foreign policy because it happens to coincide with that of the United States of America and therefore we may be made to appear to be subservient to the United

States’ interests? The Le:her of the Opposition went on to quote the wartime experiences and policies of Prime Ministers Curtin and Chifley. What if the call for United States help in World War JJ had met with the response from the United States: “ We are following our own independent foreign policy; we do not want it to coincide with yours and therefore look as though we are subservient to you “? In that situation there would have been no American response to our call and the position would have been vastly different, lt is utter nonsense for the Australian Labour Party in Opposition in this Parliament to say that we are not following our own carefully determined foreign policy.

I should like to say a word about the Opposition’s conscience. The Leader of the Opposition made quite a thing about this during the course if his remarks. He accused the Treasurer of being like Pontius Pilate, of washing his hands of the economic problems of the State Governments by refusing to give them aid. Then the Leader of the Opposition proceeded to give a first class demonstration of hand washing himself. He washed Labour’s hands of the whole Vietnamese incident and what it means. With smug satisfaction, he said -

Members of the Opposition can sleep safely with their consciences . . .

But I doubt comfortably - because they have never supported our involvement in Vietnam. They will therefore never have to answer before the Australian people, or before Almighty God ultimately, for something that is inherently wrong. We shall never have to answer for the death or suffering of any Australian soldier. lt may well be too early to make an historical judgment on that matter, lt may well be wrong in the long term, and I venture to suggest that the sufferings of 15 million Vietnamese people, struggling for relief from aggression, may well leave some kind of stain even on the conscience of the Opposition in this Parliament.

The Leader of the Opposition is very long on biblical name dropping. He spoke about Pontius Pilate washing his hands, in his reference to the Treasurer. He spoke of Herod in another context. I would like to give him another one. When he is busy washing off the conscience of the Opposition (h; sufferings of the Vietnamese people, the innocent victims of Communist aggression, wanting only a little assistance from us who have so much, he might remember the Pharisee who passed by on the other side of the road. Let us see whether that cap fits.

The Leader of the Opposition excused himself and his Party by saying that Vietnam is an undeclared war. Presumably, if there is no declaration of war, aggression ought to be allowed unchecked.* The thundering fact in South East Asia is aggression and not the legal niceties that accompany it. What we have learned is that in the last eight years there have been no fewer than 164 internationally significant outbreaks of violence. None of them has been declared. We recall Korea. We recall China’s attack on India and China’s campaign of genocide against Tibet. We recall the 12 years of Communist insurgency in Malaya. We recall the Soviet incursion into Hungary. There are many more, Communist inspired and directed towards the growth of the new Communist imperialism. The fact to be understood today is the fact of aggression and, declared war or not, aggression of that kind can be equally decisive if unopposed.

The Australian Labour Party, in the words of its leader, has chosen Vietnam and the conscription which accompanies it as the issues in the forthcoming election. The Leader of the Opposition indeed has put his own political future on the block in the outcome of the Australian people’s reaction to these two matters. Yet, as time goes on and we get a little closer to the election, there is seen to be a subtle change in the Opposition’s priority on issues. There is a bit of an attempt to move away from these as the basic issues in the coming election. Of course, there are other and important issues to come up at the forthcoming election, but they are of lower priority and indeed, without the kind of long term security that the Government hopes to guarantee by our involvement against Communist aggression in South East Asia, what we do in these other fields may have no long term meaning for Australia. For the Government, and no less for the Australian Labour Party, there ought to be a clear cut public decision on the issues of Vietnam and conscription at the coming election. The Government would welcome it, but we will be watching to see whether Labour equally would welcome it. We would not want to see Labour withdraw from that issue.

At the present moment, Labour is, of course, busy getting on the band wagon, as it always is. The Leader of the Opposition said it was very good to make the Budget speech a platform for the coming election and, of course, he sought to single out those issues on which gifts can be made to the electors on the’ widest possible basis. As I said, these issues are important. The Government’s record over the past years attests to our belief in their importance and the figures in the Budget of the enormous amounts set aside for development, social services and repatriation, together with the Government’s move into fields such as State aid for education, with Labour dragging unwillingly behind the Government’s policy, are evidence that the Government is not backward in dealing with these issues.

Now I want to come to the finish of these remarks, as I come to the finish of the remarks made to the House by the Leader of the Opposition last night. We reach different conclusions. With some omission of words which I am sure are of no consequence to the conclusions to be reached, the Leader of the Opposition, in closing, said this; -

In the belief that the people earnestly desire a change of government . . . the Labour Party enters the campaign for the election of the 26th Parliament of the Commonwealth on the 26th day of November next united, determined and confident.

I would like to take issue and disagree with him on both counts. I do not believe that the people earnestly desire a change of government and it is pretty difficult to prove that the Labour Party is united, determined and confident. The people of Australia can be left to express their own well reasoned judgment on the broad issues of great national importance before us at this time. If there happens to be any outward semblance of unity in the Opposition at this time, it is because its members are huddled together for mutual protection. On every hand they are declaring their independence, while their supporters are begging them to close the ranks and compose their differences. The Labour Party at this time is busy sweeping its troubles under the carpet. Inevitably, if it were elected to government, as I am sure the good sense of the electorate would not permit, these troubles would be out from under the carpet, but this time in government. I venture to suggest that Australia, in these formative years of her historical development, could hardly tolerate a government of that kind.


.- I appreciate the opportunity of following a senior member of the Cabinet who, I believe, deliberately misled the Parliament and the people of Australia in parts of the speech which he has just delivered. The Minister for Defence (Mr. Fairhall) told the Parliament that his Government was following its own independent foreign policy. As a humble back bencher I hope to be able to destroy that argument in the next few minutes. 1 propose to refer to a book written recently by Gerald Stone and entitled “War Without Honour”. Mr. Stone is, I understand, an American. In his book Mr. Stone refers to the former Prime Minister, Sir Robert Menzies, Knight of the Thistle, Commander of the Cinque Ports, Q.C., M.P., and I do not know what else. Referring to the decision to commit 800 combat troops to Vietnam Mr. Stone wrote - ‘

Calwell had approached the Prime Minister twice during the day to inquire whether he might be planning any major statement. Sir Robert replied both times that it was possible, but that he could not know for sure. Newspapers were carrying speculative reports about a sizeable new troop commitment, but there was no official comment of any kind. Sir Robert, in fact, had managed to keep his views on Vietnam such a closely guarded secret that it proved a later source of embarrassment to some of his closest colleagues.

I suggest that the Minister for Defence, a senior member of the Cabinet, was not told by the former Prime Minister that he intended to commit on behalf of his Government 800 combat troops to Vietnam. I say without equivocation that each and every Government supporter is nothing more than a puppet and is pursuing the same line. Government supporters are not game to raise their voices in case they are disciplined by their leader. In his book, Mr. Stone writes that on the very day the former

Prime Minister made the statement in this Parliament committing 800 combat troops to Vietnam, Senator Gorton was asked in another place whether his Government had any intention of committing combat troops to Vietnam. Senator Gorton answered - truthfully I believe - that he had no idea that that was the Government’s intention. That same night in this Parliament the Prime Minister committed 800 boys to the jungles of South Vietnam. When Senator Gorton was questioned on the matter next day he confirmed his answer of the previous day that he had had no knowledge that the Government intended to commit combat troops to Vietnam. Yet the Minister for Defence has the temerity and audacity to stand in this National Parliament as a senior representative of the Government and say that Australia is following an independent foreign policy. To say that is to indulge in nothing more than a falsehood. It is unbecoming of a senior Minister of the Government to do this.

Mr Jess:

– What does the author of the book say on page 40?


– The honorable member would be better in uniform. If he is physically fit he should be in Vietnam. I doubt whether he is physically or mentally fit.

Mr Daly:

– They do not want him. They want to win the war.


– Yes. 1 welcome the opportunity to support the amendment moved last night by the Leader of the Opposition (Mr. Calwell). The Budget does little or nothing to overcome the many great problems that confront Australia today, both at home and overseas. The miserly increase in pension entitlements for our senior citizens, our civilian widows and other pensioners is in itself appalling and deserving of most severe censure. The Government’s failure to indicate any intention to abolish the means test will further add to the great mental concern of pensioners and superannuants and will’ further encourage dishonesty among the law abiding citizens. The failure of the Treasurer (Mr. McMahon) to make any provision for concessional medical treatment, particularly for mine pensioners, or to announce the Government’s intention to stabilise the miners’ superannuation scheme by levying an excise on coal exported overseas will meet with the repugnance it richly deserves, particularly by many of my constituents in the electorate of Hunter who have spent the greater part of their working lives in the bowels of the earth. Most advanced countries like Australia show greater sympathy towards mine workers and, because of the arduous nature of their work, permit them to retire on a pension at age 55. But the Liberals of this country have acted in the reverse way. The Liberal Minister for Mines in New South Wales has indicated that the retiring age for mine workers will bc increased from 60 years to 62 years. Should this action be taken, 1 issue a warning to the Liberal and Australian Country Parties that they will be doing no more and no less than acting as agents provocateurs of a national coal strike.

A survey conducted recently in Victoria by a body of academics showed that 68 per cent, of the public thought that a fair and reasonable increase in age and widows’ pensions would be $4 a week. The Government should have given our pensioners an increase of at least $2 a week to help them catch up with the spiralling cost of living which has been particularly severe in the last 12 months. This matter was effectively dealt with in the debate by the honorable member for Blaxland (Mr. E. James Harrison) and the honorable member for Gellibrand (Mr. Mclvor). The Government’s attitude is beyond the comprehension of any reasonable and fair minded person. The burden of hospital costs on persons in the low income groups has not been relieved by the Budget. A person on a low income cannot afford to become ill because there is a complete lack of proper hospital treatment.

The Budget fails to appreciate the serious crisis that exists in education. This matter, too, was dealt with effectively last night by the Leader of the Opposition. The building industry is already showing signs of a marked slump. In Newcastle last Mondayleaders of the Building Workers’ Industrial Union met to discuss the crisis in the industry. More than 100 building tradesmen in the Newcastle district are out of work and the number is growing. The honorable member for Newcastle (Mr. Jones) and the honorable member for Shortland (Mr. Griffiths) are well aware of the grievous problem facing many building workers in the Newcastle district.

Mr Reynolds:

– They are very alert members.


– They are. 1 would like now to. comment on the appropriation for the Australian Security Intelligence Organisation in the estimates for the Prime Minister’s Department. This year an appropriation of §2,565,000 is sought for the Organisation, compared with an expenditure last year of $1,990,000. In recent years there has been a steady increase in the appropriation for this anti espionage organisation. No doubt if any Australian were asked to name the American parallel of our security service he would have to confess that it is the Central Intelligence Agency - known as the CLA. That organisation has stunned the world by its evil practices since it came into being. An outline of the activities of the organisation is contained in the book by Ross and Wise entitled “ The Invisible Government “, which is available to all honorable members in the Parliamentary Library. It would do the honorable member for La Trobe (Mr. Jess), who is constantly interrupting my speech, good to read it. If he did it might quieten his mind and exercise the muscles above his ears. The CLA. has virtually dictated to the United States Government and here in this sunny land, Australia, we find that our Government is building up our security organisation to the detriment of other more worthy organisations. Each year for the last three or four years we have seen a build up of expenditure. What is our security organisation going to spend this money on? Will it spend it on bugging devices additional to those it already has - devices that can hear what is going on in a locked room, or can listen to the pillow secrets of newly weds or of persons who might have been wed for some time? One day the Government will regret building up the security police organisation just as I believe the United States Government today feels that it has given the CLA. in the United States too much power.

Security officers have told me that security work is easy. They have no need to enter the witness box, no court work. All they have to do is to submit a report irrespective of whether or not it is accurate, and they have no fear of embarrassment or of cross-examination. Most of their information, to my mind, comes from pimps, liars and bigots who can see Communists under every bed. Recently in Newcastle a decent type of young married woman - a school teacher - sought to join an organisation. Her application was refused on the ground that she was a Communist or a Communist suspect. I am almost positive that such information was supplied to the organisation by a security officer. She and her relatives and friends are prepared to make statutory declarations to the effect that she has never belonged to the Communist Party and never had any Communist leanings. I ask: Is it fair that this security organisation should go about smearing decent Australians? I believe that it is playing a big part in driving true Australians away from the traditions of Henry Lawson and Banjo Paterson, of which most Australians are justly proud. Are we drifting towards the corrupt, pimp, perjury and untruthful society that is constanly downgrading our friend and ally, the United States of America, in the eyes of the world? There must be many cases in Australia similar to the case of the Newcastle school teacher. I have every reason to believe that the Australian security organisation is smearing decent Australians in the belief that they are Communists.

Let me go further into the activities of the CLA. in the United States of America, Vietnam, Cuba and throughout the world. The CLA. traces its beginnings to the sneak attack by the Japanese on Pearl Harbour. The Act covering its establishment allows it to disregard laws that require disclosure of a,n organisation’s functions, names of officials, titles, salaries and number of personnel employed. It can expend funds without regard to laws and regulations governing expenditures, with no accounting other than the Director’s vouchers. It makes contracts and purchases without advertising. It transfers funds to and from other Government agencies. It contracts for research outside the Government. It provides special expense allowances for staff abroad. It admits up to 100 aliens and members of their families each year. Its directors have been Admiral Hillenkoetter, General Walter Bedell Smith, Allen Dulles - brother of Foster Dulles - John McCone, who was the late President Kennedy’s appointment, until April 1965, when the United States of America decided to send troops into the Dominican Republic, and since then Admiral William “Red” Raborn. The Director is responsible for the whole intelligence community in the United States of America, which encompasses nine other intelligence agencies in. the United States of America. The CLA. is allegedly responsible for organising the abortive Bay of Pigs invasion of Cuba in 1961; for the overthrow of the government in Guatemala, where it then trained the Cuban invaders; for the invasion of United States of America marines into the Dominican Republic; for the assassination of the heads of the Diem regime in Vietnam; and for the attempt to corrupt Government officials in Singapore, which was originally denied when it was made public by the Prime Minister, Mr. Lee Kuan Yew. Mr. Lee is to be commended for refusing a $3 million bribe by a CLA. official to conceal a bungled United States of America espionage attempt perpetrated in his country.

Mr Bridges-Maxwell:

– Does the honorable member not like the CLA.?


– The honorable member would not know. He would not have enough intelligence to know. I do not know whether he is in the pay of the CLA. in trying to interrupt me when I am placing information on record. There is a strong inference that the CLA. played an important part in the recent uprising in Indonesia; in the Gary Powers incident; in U2 flights over the Union of Soviet Socialist Republics, China and Cuba; and in the political affairs of South Africa, British Guiana and Iran. Most of the information that I am now making available to this Parliament does not come from Communist magazines. It comes from the “New York Times” of 26th April. Apparently the C.I. A. has been unable to buy the editorial staff of this publication. In that paper it is stated that the CLA. has agents in all allied countries and that these agents identify themselves to the host governments and actually work in close co-operation with Cabinet officials, local intelligence organisations and the police. Their numbers in foreign embassies usually exceed those of political and economic officers, and in a few instances have comprised 75 per cent, of diplomatic missions. The CLA. Chief of Staff often has more money than the Ambassador and usually has the largest and best car. Often he has been in the country longer, and is better informed, than the Ambassador, so in some underdeveloped countries the heads of government prefer to deal with the CLA. head than with the Ambassador, believing that he has readier access to top policy making officials in Washington. The CLA. is believed to have about 2,200 agents overseas. It employs about 15,000 persons and spends about half a billion dollars a year. It is obvious to any Australian of common sense that the CLA. is in all probability active in this country. It could well be subsidising the political opponents of the Labour Party, lt could be subsidising the likes of the Democratic Labour Party, which was able to spend more time and money on television in the last Federal election than the greatest and most popular political party in Australia, the Australian Labour Party.

I am strongly opposed to any form of espionage by any country and any true Australian Government should act to suppress outside political interference. At all times it should use open and frank methods. The time might be appropriate to appoint a Senate select committee to investigate the activities of the CLA. or any other like organisation in Australia. I know that Senator Mike Mansfield and 32 other senators sought 1 1 years ago to have a joint committee of 12 established in the United States of America to maintain close control on the free wheeling of foreign operations by the American CLA., and Senator Eugene McCarthy, a Democrat from the State of Minnesota, has recently advocated stronger Congressional review power over the CLA.

Now I would like to make some further comments on the war in Vietnam, in which this Government is conscripting the cream of our youth to kill and be killed. Seventeen of our boys died last Friday, and onethird of the casualties in that action were conscripts. These boys after 1 1 months training are sent to foreign territory against their will. I challenge this Government to bring before the bar of this House any senior ranking military officer to be questioned by the members of this Parliament and to tell us whether any 20-year old Australian, fresh from the office, industry or farm, can be trained in 10 or 11 months to be an efficient first-line guerrilla warfare soldier in Vietnam. I should imagine it would be virtually impossible in that time to train them to the point at which they could take on opposing forces, man to man, in this war in Vietnam.

Mr Giles:

– Ask the Americans what they think of them.


– It is not fair to have them not fully trained - in fact, it is not fair to have them there at all. Mr. Deputy Speaker, last night you took action to have the honorable member for Wilmot (Mr. Duthie) suspended because of what you suggested was disorderly conduct, yet tonight you have been constantly allowing Government supporters to interject while I have been speaking.

Mr Giles:

– That is your fault.


– Order! I suggest that the honorable member for Hunter restrain himself and continue his speech.


– I made a count today and found that there are 17 members occupying the Government benches who are under or about the age of 40 years. They are physically fit and, I think, mentally fit, although that might be doubtful. I say that if they had any conscience at all those 17 Government supporters who are advocating the conscripting of 20-year old boys for Vietnam would have the decency to put on uniforms themselves. We of the Labour Party do not advocate conscription but if we did we would at least have more members offering themselves for service in Vietnam than the Government parties have. Not one of their members has been prepared to offer himself for military service in Vietnam, yet they are prepared to send Australian boys over there to kill and be killed.

Mr Giles:

– What about the ones in your Party?

Mr Killen:

– Where were you last time?


– I might have been chasing those absent without leave - and you might have been one of them. I was in a reserved occupation. If I had been able to get away,

I would have done so. But I would not do so in this show because it is not fair dinkum. Why are we involved in the war in Vietnam? Before I answer that I want to say that there is evidence that the United States Government, prior to the defeat of the French in Indo-China and through its Secretary of State, John Foster Dulles, offered the atom bomb to France. He was following the McCarthy line at that time, the line that the honorable member for Moreton was following before the last election which he survived on Communist preference votes. If honorable members care to study the last 10 or 12 speeches he delivered prior to his survival in that election they will find that in every one of them he spent his time damning the Communists. But if you look at the next dozen or so speeches delivered by the honorable member you will find that there is not a word of condemnation of Communists. That gives an idea of the type of man that the honorable member for Moreton is. But he will go out after the next election. He was opposed when he offered himself for pre-selection, and it is obvious that the people of Moreton have had a stomachful of him.

As I was saying. John Foster Dulles offered the atom bomb to France to drop on the Vietnamese. This was before the French defeat. Most people who have studied the Vietnam situation believe that the United States is in Vietnam because of its status as a world power. The “ New York Times” of 5th August 1953 contained an article reporting a statement made by the then President of the United . States, President Eisenhower, at Seattle on 4th August, in these terms -

The $4,000 million foreign aid appropriation recently approved by Congress to help fight the war in Indo-China is not a give-away programme, he declared, but instead a vote for the cheapest way that we can prevent the occurrence that would be of the most terrible significance to the United States of America, affecting our security, our power and ability to get certain things we need from the riches of the Indonesian territory and from South East Asia. Now let us assume we lose Indo-China. The tin and tungsten that we so greatly value from that area would cease coming.

These facts should be made known to the Australian people so that they can judge for themselves whether we should be i’n Vietnam.

Mr Killen:

– How many voluntary confessions did you get?


– Order! The honorable member for Moreton.


– It has been disclosed in a recent “ Newsweek “ magazine that General Wallace Greene, the head of the United States Marine Corps in Vietnam, has stated within the last two weeks in Saigon that the American commitment will have to be 750,000. This has been carefully and soberly considered, and it will take another six years to win the war in Vietnam militarily. It can be expected, said General Greene, that more than 100,000 United States soldiers of those 750,000 will die. And how many Australians? This Government could not care less about how many Australian lives are lost there because it is allied to the American foreign line, to which we on this side are not allied.

An article in today’s “ Australi’an “ newspaper points out that the biggest industry in South Vietnam and Saigon today is prostitution, which is being organised-

Mr Jess:

– Oh!


– Well, the honorable member would not know what one of those is. I am not sure whether I saw him coming out of-

Mr Jess:

Mr. Deputy Speaker I ask for a withdrawal of that last statement.


– Order! The honorable member for La Trobe is requesting a withdrawal. I think it would be wise for the honorable member for Hunter to withdraw and to restrain himself. I also think it would be wise for the honorable members on my right to cease interjecting. I ask the honorable member for Hunter to withdraw.


– I withdraw, Mr. Deputy Speaker. As I was saying, the greatest industry in South Vietnam today is prostitution. It is being highly organised by companies, and members of my Party who recently came back from there have told me and have told other honorable members that there are hundreds and hundreds of young able-bodied Vietnamese boys walking the streets of Saigon, touting for the brothel keepers. They are either doing that or blackmarketing in money, while our boys are dying in their jungles. The “ New York Times” printed an article on 24th February 1966 which stated that desertions from the Sagion Army in 1965 numbered 113,000, which at that time- February last - was almost half the commitment of the United States forces.

Is it not true that our boys are going over there to fill the positions of the deserters from the Saigon Army because those deserters do not want to fight against their own kith and kin? They do not want foreign troops there. They want foreign aid. They want peace. Theirs is a war-torn country which has been fighting for its independence for more than 60 years. Yet here we find the most powerful nation on earth, the United States of America, with the most modern weapons, raining down napalm and gas and phosphorus bombs on innocent communities. This is the most barbarous war in the history of mankind. As long as this Government pursues its policy of promoting the war in Vietnam 1 will continue to raise my voice, as long as there is breath in my body and as long as my vocal cords will ring out. so that at last the Labour Party will come to office, bring our boys back from Vietnam and follow a foreign policy of Australia first and Australia always.


.- In case it has escaped the notice of the House during the last 30 minutes, I point out that we are dealing with the Appropriation Bill (No. 1) 1966-67. In my electorate I have already described this Budget as a responsible Budget, or a Budget of a responsible Government that is quite conscious of its responsibilities to the public and capable of seeing quite clearly the conditions of the day and of keeping an eye to Australia’s future progress and growth. There are certain factors that affect this Budget under the conditions of the day. In fact, the conditions of the day are dominated by three factors. The first is the great stand against aggressive Communism that Australia is taking in conjunction with its allies. The second is the ravages of the drought. The third is the loss of export income, which is coupled with the balance of payments problem. That is the background against which the Government has brought down this Budget.

I belong to a school of thought - I hope it is not a very old fashioned one - that believes that before you spend you have certain alternatives, one of which is that you make or produce your wealth. If” you cannot do that you must know where you can borrow it, and if you know where you can borrow it you must be able to pay the interest on what you borrow, anc service the debt. In a young and developing country such as Australia, we must never do anything that will stifle the spirit of having a go or taking a punt. I believe that this is an admirable spirit and a very necessary and highly desirable one in Australia. But I feel that it ought to be tempered with prudence; that there ought to be some restraint.

I am reminded of a definition I have heard of what is called a Klondike spirit; namely, plenty of enterprise and optimism, unsalted with prudence. I do not think we can regard this Budget as having a Klondyke spirit. In my view it would be imprudent to have a bigger gap between expenditure and revenue than the $533 million gap in this Budget. Indeed, in this House I have heard the criticism - this has come from the Opposition in the past - that in fact deficit budgeting of any kind is inflationary budgeting. I draw attention to the fact that the Treasurer (Mr. McMahon) has pointed out that this $533 million gap between revenue and expenditure is to be covered by borrowing in various forms.

He also made five comments in respect of these borrowings, which struck me quite forcibly and which I will not forget. The first was that capital for international investment is drying up. Secondly, there is increased competition for what is available, both overseas and in Australia. His third point was that interest rates are very high and are rising. That was confirmed by him today in answer to a question. All these points affect greatly our borrowings overseas and in Australia. His fourth point was that the Governments of Great Britain and the United States, have placed restraints on the export of capital from their countries. The final point to which he drew attention in regard to borrowings was that public authority borrowings in Australia are larger than ever this year.

The Commonwealth must honour, and I consider it will honour, its promise to assist the States to meet abnormally large calls on their Budgets which are caused by drought. Of course, these calls are beyond the existing financial capacities of the States. In response to the cries of not enough “ that we hear from the States, we must reflect on the statement made by the Treasurer that, after allowing for overseas borrowings and in the face of the five points that he made, we have to face up to temporary borrowings in Australia of $270 million. I point out- I believe that this should be taken into consideration - that these borrowings by the Commonwealth will be made in competition with public authorities which are under the control of the States. So the Commonwealth enters into competition with the public authorities.

In dealing with some particular aspects of the Budget, I wish to mention education. I note that of the $141 million set aside for education $22.7 million is for Commonwealth scholarships. That is quite a substantial sum. I presume that some of the scholarships will be for the training of doctors and dentists. In this respect I draw attention to the great difficulties that are being experienced in many inland towns and some of the more remote areas in finding professional men in the medical and dental fields who will come to reside and practise in those areas. One does not have to go to very small areas to find these difficulties. I do not know whether the position has changed just recently, but I know that not long ago the town of Cobar - a developing town in New South Wales - was guaranteeing $20,000 a year and offering a residence for a doctor. The position may have been filled by now, but I do not think it has been. Many doctors are attracted to the bigger centres. That is their entitlement. A great number of our dentists have gone to England. 1 have investigated the figures. I know just how many have gone to England. I have spoken on this matter in the House previously.

The suggestion which I now put to the Government and which I have put on paper already is that some sort of tag or condition be put on Commonwealth scholarships for the training of doctors and dentists. I suggest a clause that would require the trainee to serve for a period of, say, two years, or some other, nominal term, in a town or district of his own choice, with a population below a certain number. This might seem to be rather radical thinking, but I keep in mind the feelings and needs of the people in the more remote areas. We are a democratic people. We cannot tell people where they will serve. But I put this forward as a suggestion.

Already there are a number of precedents in this regard. For instance, in the teaching profession there are conditions not as to where teachers serve but as to the length of time they serve. People in other sectors of the population - such as police, members of the banking fraternity and some clergy - know very well that if they go into a certain calling they will be required to serve in some of the more remote areas before the plums come their way. I look at this matter from the point of view of the taxpayers who, by means of a Commonwealth scholarship, assist a trainee to gain his position in a particular profession. They assist him out of their pockets. I believe it to be reasonable - and I put this to the Government - that the trainee should repay the debt that he has incurred by devoting at least some of his time to serving people in more remote areas.

The second point that I wish to raise in regard to education is that in the Budget speech mention is made of specific universities, Colleges of Advanced Education, science laboratories and technical training facilities. I suggest again that the Government could widen its outlook into the field of agricultural education. We can quite easily find evidence that the Commonwealth already has assisted greatly in the fields of research and extension services. I lay particular stress on the work that the Government has done in building up the funds for extension services. But perhaps it could extend its assistance to secondary and tertiary education in agricultural pursuits and even to the training of teachers for agricultural colleges. There is a tremendous demand throughout Australia for skilled teachers of this kind but they are not becoming available for the task. Private enterprise takes trained people as quickly as they can be trained. My colleague, the honorable member for Hume (Mr. Pettit), has already raised in this chamber the question of providing schools to teach shearing, and 1 hope that we can make progress in providing shearing schools. He will undoubtedly bring attention to that matter again later. I know that the New South Wales Government is keen on expanding agricultural colleges that provide training in woo! techniques, but I cannot for the life of me see where the qualified teachers needed for this kind of training will come from in the present situation. As I have already mentioned, private enterprise is sn; pp,ng up every trained person as soon as he comes out of an agricultural college.

Representing a country electorate as I do. and having only limited time, I believe it will be understood why I propose to direct attention to several aspects of this Budget which concern the man on the land and which will assist him in his constant battle against the cost-price squeeze. I would like to highlight the additional assistance that he will be afforded in this battle by the Budget that we are now considering. The primary industries are included, along with the oil. mining and shipbuilding industries, in additional subsidies and bounties that are lo he provided. The primary industries are to receive bounties that were not provided for in previous Budgets. We note that we are to hear further details of plans to increase Commonwealth funds for research and development and we hope that some of the additional funds will be devoted to primary industry.

We appreciate in this Budget the tax proposals concerning adjustments for double wool clips, income from sales of livestock brought about by acts of God such as drought, fire and flood, and the removal of the seven year limit on the period during which losses may be carried forward. All these proposals will be of tremendous value to primary producers. Each is not big in itself, but each shows that the Government is conscious of the need to assist the great exporting primary industries in the cost-price battle. The limit in respect of averaging provisions is to be doubled and will be raised from $8,000 to $16,000. This will be of tremendous help, as will the proposal concerning the writing off of the full cost of fences erected to combat soil erosion.

I believe that one of the most beneficial features of this Budget is the proposal to pay a bounty on nitrogenous fertilisers. This gets out of the realm of the man on the land and it will represent a national investment. The Government is to be wholeheartedly congratulated on this move. The Minister for Primary Industry (Mr. Adermann), in a Press release, described the proposed bounty as having two purposes, and these I reiterate. The first is to reduce costs in the sugar industry, which is hard pressed, as we know, and the fruit and vegetable industry. The second is to promote increased productivity. Higher productivity is a constant aim of this Government in, to use the Minister’s own words, “ newer fields opened up by recent research “. He specified temperate, subtropical and tropical pastures and grain crops.

So that there will be no doubt in the mind of anyone in this House about the fact that this bounty will be a national investment, 1 direct the attention of honorable members to work done by research workers from the University of Sydney at a property called “Coolamatong”, near Orange in the Calare electorate. Since 1962, trials have been conducted there under the direction of the University of Sydney. Preliminary investigations based on a study of the relationship between oat seeding rates, seeding times and fertiliser supplies show that the first major development was that the researchers found that winter production on one acre of improved pasture increased by more than 400 per cent. These are not just figures pulled out of the air. Nor are they estimates. They are figures ascertained by actual production tests at “ Coolamatong “ since 1962 in a project conducted under the direction of the University of Sydney. In addition to this increase of more than 400 per cent, in winter production, there has been a side effect in the provision of a valuable grain byproduct for summer use. I would like to quote from Report No. 7 of the University of Sydney School of Agriculture, which deals with increased winter and drought forage for tableland livestock and which was based on this project. The report states -

Nitrogenous fertilisers appear to have a vital role to play in increasing the late autumn, winter and early spring production of high density oats sown on quickly prepared seed beds, even on high fertility old pasture paddocks.

This in itself is of great benefit to the prime lamb industry and the production of wool and grains. We know of the importance of nitrogenous fertilisers in the production of wheat and oats, and also for cereal crops. Experiments are being conducted by many farmers on their own behalf in the use of these fertilisers. There has never been a doubt about the result. We know that if one scatters a little nitrogenous fertiliser about, one quickly sees the results. The Australian farmer, in his usual efficient way, is again dealing with the cost-benefit ratio. The important questions are: What does one get back? What does it cost? Is it worth while? A lot of individual work is going on. On my own property, for example, my son is doing a good deal of this work. I know, because he presented me with a bill for fertiliser the other day. So 1 thank the Government for the bounty that it proposes to provide. I shall appreciate it.

For these reasons, 1 say to the House and to the public that the bounty on nitrogenous fertilisers will not be a handout. 1 couple it with the superphosphate bounty and say that the two represent a sizeable national investment which is calculated to increase export income and national profit in the form of trade. From these trading profits, all good things flow. Without export income, we could not do as much as we would like to do in providing social services and the like benefits. Nor could we build up our defences and look after ourselves.

At this point, I want to say what a pity it is that more publicity is not given to the aid that this country extends to other nations. This is not the fault of the Minister for External Affairs (Mr. Hasluck). He can put out as many information releases as he likes, but it is quite a task to have the information published everywhere that we would like. The figures showing the increase in the funds allocated to the Colombo Plan, the International Development Association, special emergency aid of all kinds and the Asian Development Bank should be known to all. I shall not discuss them in detail now, but I want to direct attention particularly to the fact that this economic aid has increased by 70 per cent, in the last five years. This represents a sizeable increase. It is left largely to private members in this Parliament to point out to the people that Australia is among the first four or five nations in the world in terms of relative performance in the giving of economic aid to other countries. 1 now want to make a few brief comments on the National Welfare Fund. With the advent of decimal currency and the increase of S50 million proposed in this Budget, the National Welfare Fund will now reach 10 figures for the first time, at a total of $1,020 million. There is nothing stay put in this kind of figure.

Finally, 1 want to discuss water resources. I regret that I shall not be able to develop this theme as I would like in the time available. I notice that $48.5 million is to be allotted to the Snowy Mountains Hydroelectric Authority. This is $6 million more than was spent in the last financial year. Reference to the Budget papers will disclose the channels along which the money is being sent. It is being expended, for example, on the development of the Snowy-Murray area, which includes the construction of the Murray 2 power station, and on the provision of certain electrical gear for both Murray 1 and Murray 2 power stations. Some of it will be paid out by way of contribution towards the expenses of the River Murray Commission. Admittedly this contribution is small, but it does give an indication of the type of activity which will benefit from the additional $6 million.

While acknowledging the large, increased sum of $48.5 million, I point out that many questions have been asked by the general public, by the employees concerned and by honorable members in this House over the years as to the future of the Snowy Mountains Hydro-electric Authority. This is a question which interests many minds in Australia at the present time. We have been assured by the Minister of two things. We have been assured, firstly, that every effort is being made to gainfully employ the personnel from the branches of the Authority most concerned - the Investigations and Designs Branches. In fact, we are told that Sir William Hudson personally sees every engineer who leaves the employment of the Snowy Mountains Hydro-electric Authority.

This is the first assurance that we get from the Minister. We have also heard that an interdepartmental committee which studied the future of the Snowy Mountains Hydroelectric Authority reported to the Government during the winter recess. We learn that the Government is now considering this report. We are waiting anxiously to hear the results of that examination, but probably not as anxiously as are some of the highly skilled men who are now working with the Authority.

I draw attention now to a magazine, “ Coal, Shipping and Steel “, and quote from it an article relating lo dams. Amongst other things, it says -

Dams when they are built in the country are built in a dribble and take years and years. The American idea of plugging into a job and “ getting it over and done with “ and productive has not penetrated the peanut brains of most of our politicians.

I cannot agree with all that. Not all our politicians are peanut brained. But honorable members will see why I quote that extract. They might ask why it appears in this magazine, because it is the sort of article one would expect to read in a magazine devoted to water conservation, or in some j’ournal published for the man en the land. It is published by the magazine “ Coal, Shipping and Steel “, a magazine which, one would think, would be more interested in secondary industry and mining than in water conservation. 1 might say thai 1 look through every issue of this magazine and take from it the points it highlights. The fact that it contains an article such as the one 1 have read is a good indication of the broadening of thinking in the Commonwealth of Australia on the question of water conservation. The article points to the preoccupation of governments with suburban and city transport, with vastly expensive highways and with garden water supplies. It also suggests that their view beyond the capital cities is likely to be limited to urban areas. 1 might point out that this article was published twelve months ago. Since that time, there has been a change of government in New South Wales. We now have at the helm there a man who, though he is roundly criticised, does have big plans for the future. There is certainly a change in the outlook of the New South Wales Government towards this aspect.

The magazine also praises the work of the Queensland Commissioner for Water Supply. So do 1. I do not know how he does it, but although he is working for a free enterprise government he has one section of his workers employed on a contract basis and the other section on a day labour basis. That is good, because one section is an admirable foil to the other. Both are essential in this particular work of conservation. The magazine finally calls for men of vision languishing within departments to be got together with the experts of big corporations to develop - 1 emphasise this - a proper long term national scheme with priorities.

I can speak on this subject because 1 spoke along the same lines in my maiden speech in this House, when I drew attention to the need for three things. The first need 1 mentioned was for a study of available resources. We now have the Australian Water Resources Council, which is doing a good job. The second need I mentioned was for the allocation of priorities. I have forgotten the exact wording I used on the earlier occasion, but the third need referred to the executive phase, to the carrying out of work in conjunction with all the States concerned.

The editor of this magazine is not a lone voice. Look at some of the quality he has with him. For example, he is supported by Professor Munro, Professor of Civil Engineering at the University of New South Wales and Director of Research in the Water Research Foundation. This man has always interested me because he takes a big look at water conservation. He has said that the job is not complete unless you work right across the board. He says that water conservation starts with the small dams on the farms and goes right through to the bigger projects at the other end. He says that you cannot look at any one factor in isolation. He is a man who looks right across the whole field.

Sir William Hudson, a man well known to honorable members of this House, has made the firm declaration that the development of our available water resources can only succeed if it is made a national task. I hope that the Government, when considering the report, will tie it in with what we refer to as the Vernon report. If any honorable member wants to see the references to that,

I can provide them. The Vernon report refers to the desirability of setting up a special projects commission. This has a lot of good points in its favour so far as I am concerned. This proposed commission would investigate proposals for major developmental projects, advise governments on them and publish its findings. I wonder whether all these things could be welded together and whether we could have an organisation which would deal with the national planning of these big projects, especially those relating to water. I wonder whether we could get more of the top men of the Snowy Mountains Authority into this. We should make it known to all the other men very quickly that they will have no need to worry, that there will be no reason for any of them to leave Australia to seek work and security, that we will have work for them in this country, and that we will use them where the highest priority lies.

If one goes further into the Vernon Committee’s report one will see that some very good studies have been made of rainfall registrations, of the general water situation, of our present water resources and of the potential of water resources. It highlights the fact that this continent contains but one major river system - the Murray-Darling system. This, of course, includes the Lachlan and Macquarie Rivers and all their tributaries, just as it does the tributaries of the Darling. I do not want this great basin further split in any planning for the future. In dealing with this system, the Irrigation, Development and Food Production Advisory Committee said this in its report dated August 1955-

It is unique-

I repeat “ unique “ - among our western river valleys in the extent of river terrace lands eminently suitable for irrigation.

I think that high priority must be given to the Murray-Darling system. I consider that the emphasis should be placed all the time on planning, planning, and continued planning by an organisation something like the Australian Agricultural Council, the Australian Forestry Council and the National Mapping Council - bodies consisting of Commonwealth and State Ministers. I suggest that the States and the Commonwealth combine in this great work, because that would avoid a repetition of some of the scratchy policies that we have had up to this time.

I conclude by repeating a sentence I used in my maiden speech in this House when dealing with water conservation. On that occasion, 1 said: ‘“Therein lies the great work and the great future for this country “. I congratulate the Treasurer on his Budget, and I support it.

Smith · Kingsford

– The present Federal Government has been in office for a period of 17 long years. Initially great promises were made by the Prime Minister of the day, Sir Robert Gordon Menzies, who is now the Warden of the Cinque Ports, as to what he intended to do and what great expansive ideas he had about the problem of housing. Sir Robert Menzies declared that those ideas were to settle the problem once and for all. Of course, as honorable members on this side of the House are aware, nothing was done. This was the usual Menzies’ method. Some months back the Right Honorable Sir Robert Gordon Menzies could see the writing on the wall so he resigned from politics, being afraid to face up to the mounting public reaction to the general housing policy. Time passed and the present Prime Minister (Mr. Harold Holt), a colourless political figure, was elected to fill the shoes of Sir Robert Gordon Menzies. He also made grandiose promises to meet the housing situation, but still nothing has been done. If homes could be built from the many speeches and statements made by Ministers, the Australian housing shortage could be overtaken without any trouble. This is obvious to all.

The new Federal Minister for Housing (Senator Dame Annabelle Rankin) promised to watch the future housing figures carefully and, if necessary, to recommend action. Would it not be nice if Ministers would become a little tired of looking at figures? Would it not be better for them to cast their eyes about and look at some of the shacks and shakedowns in which people are living today in this great Australian nation? In all capital cities people can see the disgraceful state of the housing situation. The new Federal Minister for Housing said that she would ensure the building of reasonable homes at a reasonable cost and, if necessary, would recommend that action. Exactly the same promise was made by previous Minutes for .-lousing over the hist 17 years. This promise, of course, could mean nothing to many thousands of families in the lower income bracket who definitely need homes. They do not have the necessary cash deposit.

Much has been said by responsible Housing Ministers over the last 10 years about overcoming the housing deposit gap. That is quite a cliche today. But we must face the fact that after 17 years of Liberal Government the gap has grown wider and home purchase has become almost impossible. During this period we have heard long speeches by Ministers and other prominent people, cranks, hypocrites and puritans in our community in regard to the alarming decline in the birth rate in Australia. They criticise all and sundry for the extravagant use of the pill and other contraceptives conveniently forgetting, of course, that the use of such is forced upon people, much against their will, owing to the fact that they have no homes in which to live. Give them a home to live in and they will establish a family very quickly, and a large family at that. One would think that our prominent citizens in their statements and speeches would lay the blame where it belongs - wholly and solely upon this Federal Government.

One has only to look about our economy to see the conditions that face newly married couples who have no option after the wedding and the honeymoon but to return to either parents’ home and live in a back room with mum and dad. That is a practical statement. What a prospect to look forward to. Any married couple with a husband earning $50 a week can look only to the Housing Commission for relief. But we find, particularly in the State of New South Wales, that few houses are being built and that there is an alarming stagnation in the housing field. We find that throughout Australia few houses are being built. As a matter of fact the number of houses and flats built in Australia in the financial year 1965-66 fell by 10,000, according to the preliminary statistics issued by the Federal Department of Housing in Canberra. Speculation in the housing field at present under Liberal Governments, both State and Federal, is alarming and calls for an inquiry by a royal commission. The vicious tactics adopted by the speculative builders and particularly by some members of the Real Estate Institute should be exposed. Those gentlemen are aided and abetted by the Liberal Government in New South Wales, in particular, to such a degree that the position calls out aloud for examination.

We find that the money allocated by the Federal Liberal-Country Party Government for Commission housing is not used in that field. Such snide tactics are being used by the New South Wales Liberal-Country Party State Government to dodge its responsibilities and to assist the vicious element operating in the housing field and particularly in land speculation. We find on examination that the allocation to the State Government - the anti-Labour New South Wales Government - is being diverted to building societies and is not being used for the purposes intended. It came to my knowledge that a new technique has been followed to repay those who made available the huge amount of money for the Liberal and Country Parties’ election expenses in New South Wales. The technique is as follows.

Mr Cleaver:

– This will be good.


– It is good. The practice is crook and it should be inquired into. The new anti-Labour Government simply evades its responsibilities to the Commonwealth and State Housing Agreement by failing to carry out the building of the homes necessary for rent through the New South Wales Housing Commission. I have been advised from a reliable source that the land which was resumed by the Housing Commission of New South Wales under the previous Labour Government for home building purposes - honorable members should listen to this - was now being offered for sale at public auction. The execution of the scheme is well planned and provides the opportunity for the vicious speculative Real Estate Institute sharks to force building land up to an extortionate price which is out of reach of the average newly married couple. In my electorate alone I see before my own eyes auctioned land being forced up to the extortionate price of $9,500 for a building block. Such is the high cost of Liberal government. Something must be done and done quickly. Only the return of the Labour Government at the forthcoming Federal election will rectify this problem.

The recent high valuations tell their own story. I invite the present Minister for Housing in this Government to examine my charge to test its veracity. Could I suggest that the Prime Minister call an urgent meeting of Housing Ministers to rectify this matter and demand that the Housing Commission in New South Wales withdraw from auction all building land resumed for that purpose by the previous Labour Government and set about using the Commonwealth allocations to the State for the purpose for which they were designed, that is, the building of homes for rental and sale on the resumed land. Today Government spokesmen speak so glibly of our affluent state, yet much of our affluence is brought about by hire purchase, wives going out to work or husbands doing two jobs. Statistics show that 70 per cent, of income earners earn $50 a week or less. Many thousands of these people live in sub-standard or inadequate housing. This is a shocking commentary in any civilised community.

The Federal Government recently established the Housing Loans Insurance Corporation, but this does not provide any money, lt merely insures members against loss. This service has operated for some years at a State level. It proves that lenders are not interested in this type of business. There is not a shortage of motor cars, television sets, washing machines and other appliances; nor is there any shortage of finance to make more. But the decline in home building comes from the tying up of finance and is more serious today than it was during the 1961 credit squeeze.

Trade unions in the building industry are becoming alarmed at the lack of support by this Federal Government for the home building industry. On the other hand, we find the saw milling industry working at high speed fulfilling orders for speculative builders who are busily engaged in every city in the construction of huge new city office blocks which are being constructed out of the huge profits that are made by vicious monopolies operating at full blast under this paternal Government - an open go really for all the crooks foi full speed speculation in valuable city properties. On the other hand, the home build ing section of the building industry is in a sorely depressed state. The situation has reached crisis point.

The trade union movement in New South Wales is most concerned at the present position in the home building field. Many thousands of families are in urgent need of good housing at reasonable rental or low home purchase payments. Ample supplies of all kinds of building material are available. Many skilled building workers are unable to find continuous employment in the industry and unemployment for long periods between jobs is increasing. But, despite these facts, the level of home building is falling at an alarming rate. The figures of the Commonwealth Statistician - these are his figures, not mine - reveal that in the first four months of this year compared with the same period of last year, the number of new houses and flats approved in New South Wales dropped by an alarming 22 per cent. Last year, in the first four months, 14,526 new houses and flats were approved. In tha same period this year, the figure is 11,371. This is alarming, to say the least. The number of Government homes approved in the same period fell from 1,541 last year to 704 this year - by 50 per cent. While Housing Commission homes building under a Labour Government has increased in recent years, it is still a long way from satisfying the growing demand.

In 1964-65, under a Labour Government, the New South Wales Housing Commission built a record number of housing units, that is, houses and fiats. In fact, 5,482 new housing units were built. When premises which became vacant and were reallocated are added to that figure, a total of 7,384 units became available under that Labour Government. Yet, during the same year, 18,805 new applications were lodged as contrasted with the lodging of 16,688 applications in the previous year. Even taking into account a certain amount of wastage among the applica’tions it is fair to say that the Housing Commission construction programme met only about one third of the housing demand for that year. It would be fair to say also that at present approximately 30,000 applicants would be on the books of the New South Wales

Housing Commission awaiting accommodation. Yet this Budget makes available $1,000 million for war purposes.

The latest report of the New South Wales Housing Commission states that in the Sydney metropolitan area the waiting time for family accommodation was reduced to less than four years. What a performance that is. But the waiting time for accommodation for elderly persons was about five years. Another factor to be considered is that while attention is being paid to the provision of new housing insufficient attention is being directed to the replacement of many thousands of sub-standard dwellings in which people are compelled to live. A few years ago an estimate was made by the County of Cumberland Planning Association. The estimate showed that there were 40,000 sub-standard dwellings in Sydney alone. What a shocking commentary. Many thousands more which could be added to that total are to be found in country areas. This can clearly be seen by a walk round the back streets of most country towns.

The housing problem is an immense one and requires urgent action by the Government. I think that the housing problem is too big for this Government. It should get out and make room for a Labour government, the only government that can overcome the problem. Such action is necessary not only to meet the keen, pressing needs of the home hungry but also to advance Australia’s economy and the wellbeing of our population. We hear talk here day after day about Australia being held in high regard in different countries. But I think that if those different countries knew of the housing problems and the conditions of living in some Australian cities and towns the picture would be different.


– That is why the British migrants are going back.


– That is right. The construction of housing involves the production of many different kinds of materials and the employment- of thousands of workers. The furnishing of new homes is a very important part of native Australian industry also.

A national trade union policy on this important question was decided at the 1965 Congress of the Australian Council of

Trade Unions. The resolution unanimously adopted at the Congress stated, inter alia -

Congress expresses its deep concern at the continued failure of the Commonwealth and State Governments to curb the so called developers in real estate and home building, their failure to control the prices of land, building material and rents and their failure to reduce interest rates which has resulted in the capital and annual cost of housing reaching an exorbitantly high level.

This Congress comprises the representatives of the trade union movement all over Australia. These are the men who know. These are the men who see and live the building industry. The resolution continues -

The problem of increasing housing costs has resulted in people in the lower income group in particular being denied adequate housing, a commodity which all members of the community are justly entitled to.

There is little or insufficient finance available for those who want to buy their own home on small deposits. There are ample supplies of building materials, timber, bricks, cement, hardware, steel, etc. Congress therefore culls on the Commonwealth Government:

For an allocation of sufficient finance at low interest rates to the Slate housing authorities to step up home building.

To arrange through banks and housing co-operatives for more long term finance at low interest rates to enable people with low deposits to purchase their own house.

Congress therefore reaffirms its support for the principles of the 1945 Commonwealth State Housing Agreement, which provided for rental housing, a rental rebate system and low interest rates.

We consider that this policy resolution directly points to the key question in the housing problem and that is the shortage of finance and, as part of the question of finance, the intermittent nature of the flow of finance for the home building industry. Throughout the post-war period, the building industry has been used as a sort of political football. Whenever Government action is contemplated to check inflation, the main attention has been paid to the building industry. Financial restrictions are imposed, building slackens off, workers become unemployed and our economic problems are intensified. Then, as the economic situation requires stimulation, finance is released again and the industry is able to make a partial recovery. But this stop-go approach to the building industry is economically wasteful and harmful.

Skilled workers are lost to the industry, for the working person looks for an industry that will provide him with long term security, and this has not been available in the building industry.

The allocations of the Federal Government to the State Housing Commissions have improved in recent years. Since 1961-62, the annual allocation to New South Wales has increased by almost $4 million. But this financial allocation is far from sufficient to meet the needs of our State. The trade union movement considers that the Federal Government should immediately double all allocations to the State Housing Commissions and arrange for the release of finance through the Reserve Bank at low interest rates for people wishing to purchase or build their own homes.

Another important factor is the rate of interest. The 1945 Commonwealth-State Housing Agreement provided for an interest rate of 3 per cent. I direct the attention of the Minister for Civil Aviation (Mr. Swartz), who is now at the table, to the fact that the new Commonwealth-State Housing Agreement introduced by this Government increased the interest rate. It loves to increase interest rates. The latest report of the New South Wales Housing Commission states that in the past year the interest rate on housing agreement advances rose by three-quarters of 1 per cent, to 4i per cent., considerably affecting costs and rentals. Finance available to people wishing to build their own home is at a high cost. Many intending home builders are obliged not only to borrow on a first mortgage but also to undertake a second mortgage at exhorbitant interest rates ranging from 8 to 10 and even 12 per cent. That is a shocking commentary.

We consider that the Federal Government needs to take action to curb the finance sharks by subsidising home building loans so that a maximum rate of interest of 3 per cent, is payable by intending purchasers. Other countries are able to make such subsidised loan money available. Australia, as a developed industrial nation, should be able to assist its people in the same manner. The Congress considers that finance available to the Housing Commission can best be utilised in the development of the Commission’s own home construction team. We consider that homes built by employees of the Government on a day labour basis can be built as cheaply as those constructed by contract builders, and this form of construction gives more security and continuity of employment to workers. The development of project building facilitates the use of a Government day labour team, and we submit that this proposal should be examined by the Government and by the Housing Commission.

The present method of construction, whilst having temporary advantages as far as costs are concerned, is harmful in the overall sense to the future of the building industry. It does not allow for the training of apprentices. This is most important. A significant commentary is that on the Green Valley project in New South Wales few if any apprentices were trained. Housing Commission construction by day labour will attract to its ranks skilled tradesmen who would be able to assist in securing the future of the industry by training apprentices. It will also provide an additional avenue of employment for young people and enable the many potential apprentices, who are at the moment unable to find employment in the industry, to be apprenticed.

The sky-rocketing cost of land has prevented many families from obtaining satisfactory housing. The trade unions consider that Government action should be taken to stop land speculation by imposing price control on land and by ending the sale of Crown land to private individuals. The State Government could assist home seekers by making Crown land available only for Housing Commission rental housing. This could be done by releasing tracts of Crown land for project building for particular sections of the community - for example, projects available for young married couples only or a project devoted to building cheap rental housing units for aged couples. Firm curbs on land speculators would also be of great assistance in tackling the housing problem.

Debate (on motion by Dr. Gibbs) adjourned.

page 398


Motion (by Mr. Swartz) - by leave - agreed to -

That the honorable member for Bowman (Dr. Gibbs) be appointed a member of the Joint Committee of Public Accounts in the place of Mr. Cockle, deceased.

page 398


International Affairs - Recovery of Overpayment from Public Servant - Security of Members’ Offices - Australian Serviceman.

Minister for External Affairs · Curtin · LP

– I move -

That the House do now adjourn. 1 wish to correct a statement of historical fact made by the honorable member for Eden-Monaro (Mr. Allan Fraser) in his speech on international affairs in the House on the evening of 18th August 1966. It is in “ Hansard “, pages 236 and 237, of the current sessional period. The honorable gentleman said -

In 1954, John Foster Dulles made an agreement with the Australian Government. The agreement was for a grand alliance to launch a sudden and unprovoked air strike on the Vietminh forces that were besieging the French in Dien Bien Phu. Eight countries were to join that grand alliance. Australia was one of them. Consultations took place with Australia. The whole plan was kept entirely secret at that time.

In a later passage the honorable gentleman continued -

At that lime also the Geneva Conference was about to meet. This was the time at which John Foster Dulles called the Congressional leaders of the United States of America together. They told him that they would not endorse his plan unless he obtained allies. Following this, he came to the Australian Government with his secret proposal for Australia’s support and, I believe, obtained it.

A little later he continued -

This plan was killed by the refusal of the United Kingdom Government to have any part of it and the disinclination on the part of the French to go along with it. But, as I understand it, there was no disinclination on the part of the Australian Government to join the grand alliance.

The honorable member quoted no authorities or sources for his statement. At the time the statement was made I was in the House and I was under the impression that it was incorrect but I did not interject because I wished to consult the documents. I have since done so and now say categorically that the statements by the honorable member for Eden-Monaro which I have quoted are incorrect in all their references to Australia. The official papers are still classified but the Australian Government’s position was made known to this House when the Geneva Conference ended. I draw the attention of the House to the statement made to it by the then Minister for External Affairs, the Right Honorable R. G. Casey, on 10th August 1954. He said-

In April, the French and Viet Nam forces were waging an unequal conflict at Dien Bien Phu against the Viet Minh. Talk of intervention, particularly in the air, in order to save the situation, was being widely canvassed at that time. Our Australian view was that such intervention would be wrong for the following reasons: - It would not have the backing of the United Nations. It would put us in wrong with world opinion, particularly in Asia. It would probably embroil us with Communist China, lt would wreck the Geneva conference, and it was most unlikely to stop the fall of Dien Bien Phu. These were the views that I expressed on behalf of the Australian Government to Mr. Dulles, Mr. Eden, and other leaders at Geneva.

That quotation may be found at page 97 of “Hansard” of 10th August 1954. The statement by my predecessor is on the published record and, needless to say, in making it my predecessor spoke with responsibility and with truth abou! the views he had communicated to the Governments of the United States and the United Kingdom. I would add only that Lord Casey, then the Right Honorable R. G. Casey, who visited New Delhi during the Geneva Conference, also personally informed the late Jawarhalal Nehru of the position that the Australian Government was taking on this matter. I do not want to comment on the subject but I do want to put the record straight and to make it plain to the House that the statements about Australia’s part in this episode were correctly stated to the House by my predecessor in August 1954.

Mr Allan Fraser:

, - The statement that I made was explicit. The Minister for External Affairs (Mr. Hasluck) has raised a smoke screen to avoid dealing with the truth of this matter. The statement that I made to the House referred to an approach made by John Foster Dulles to the Australian Government in April 1954 before the Geneva Conference met - within a week of his same meeting with the congressional leaders in Washington. The Minister for

External Affairs has replied with a statement made to this House by the then Minister for External Affairs after the Geneva Conference-

Mr Hasluck:

– But-

Mr Allan Fraser:

– Wait a minute. Let the Minister take it. I listened quietly to him. As I was saying, he has replied with a statement made to this House in which the then Minister for External Affairs reported the position ultimately taken by the Australian Government after the United Kingdom Government had killed the proposal by its complete opposition. They are two entirely different episodes.

Mr Hasluck:

– That is not so.

Mr Allan Fraser:

– I challenge the Minister to-

Mr Hasluck:

– 1 say that the honorable member is still incorrect.

Mr Allan Fraser:

– 1 challenge the Minister to deny that John Foster Dulles, on behalf of the American Government, approached the Australian Government in April 1954 with a proposal for a grand alliance of eight countries to conduct an air strike on the forces besieging Dien Bien Phu.

Mr Hasluck:

– I-

Mr Allan Fraser:

– Let me continue. The Minister may deny my statements later, but let me state my case. At that stage the Australian Government did not oppose the American proposal.

Mr Hasluck:

– The honorable member is completely incorrect.

Mr Allan Fraser:

– Well, I ask the Minister to deny it. What does he deny? Does he deny that the approach was made?

Mr Hasluck:

– I have given to the honorable member the Australian response.

Mr Allan Fraser:

– The Minister has not.

Mr Hasluck:

– 1 have.

Mr Allan Fraser:

– The Minister has quoted a statement made in the House by the then Minister for External Affairs after the Geneva Conference ended and referring to the attitude expressed ultimately by the then Minister at the Geneva Conference. What 1 am referring to is the immediate agreement given by the Australian Government when this proposal was first put to it by the American Government.

Mr Hasluck:

– No such agreement was made. 1 have correctly stated the facts.

Mr Allan Fraser:

– Of course the agreement was not made. We know that it was not made ultimately. The Minister is only dodging the issue by trying to avoid this point. I have said that John Foster Dulles convened a secret meeting of congressional leaders and asked for their approval for an American air strike on the forces besieging the French. In April 1954 the congressional leaders indicated that they would not give consent unless Mr. Dulles obtained allies. Within a week, he had conducted conversations with the Australian Government, among others, in an endeavour to obtain allies and he did not obtain rejection from the Australian Government at that stage. It is quite clear. The proposal was still current when Eden returned twice to London and consulted with his Cabinet - the Cabinet in which he was Foreign Secretary - and brought back to Europe the absolute refusal of the United Kingdom Government to have anything to do with it. At that stage the Australian Government had not expressed any refusal whatever.

Mr Hasluck:

– The honorable member is quite wrong.

Mr Allan Fraser:

– I am quite right.

Mr Hasluck:

– The honorable member is quite wrong.

Mr Allan Fraser:

– I am not.

Mr Hasluck:

– What is the honorable member’s source?

Mr Allan Fraser:

– What is the Minister’s source for attacking my statement? His only source is the one he has quoted - a reference to a completely subsequent statement made by the then Minister for External Affairs after the proposal had been effectively killed.

Mr Hasluck:

– But relating to events in April. It is plain that that statement relates to events in April.

Mr Allan Fraser:

– In this statement made by the then Mr. Casey he does not refer to any approach made by the American Government to the Australian Government. He does not refer to any approach at all, yet the Minister knows it took place.

Mr Hasluck:

– The passage that I quoted begins with the words “ In April “.

Mr Allan Fraser:

– The passage the Minister quoted begins -

In April, the French and Vietnam forces were waging an unequal conflict at Dien Bien Phu against the Viet Minh. Talk of intervention . . . in order to save the situation, was being widely canvassed at that time.

The Minister did not refer in his statement to the approach then made by the American Government to the Australian Government or to the reply then made by the Australian Government to the American Government. My point is that at that stage the Australian Government did not reject the proposal and was prepared to go along with it until subsequently the attitude of the United Kingdom Government, which was then backed by the French Government, killed the proposal.

Mr Hasluck:

– The honorable member is wrong.

Mr Allan Fraser:

– To show that the Minister’s statement is incorrect-

Mr Hasluck:

– The honorable member is wrong.

Mr Allan Fraser:

– Well, the Minister has relied on a statement which does not answer the one I made, and he knows it.

Mr Hasluck:

– I have already examined the documents.

Mr Allan Fraser:

– The statement by Mr. Casey, as he then was, says that intervention in Vietnam would be wrong for the following reasons -

It would not have the backing of the United Nations.

Is the Australian Government opposed to intervention in Vietnam for that reason7 The statement continued -

It would put us in wrong with world opinion, particularly in Asia.

Is that the policy of the Australian Government? Another reason was -

It would probably embroil us with Communist China.

Is that concerning the Australian Government? These were the views of the British Government, subsequently acceded to by the Australian Government, and stated by Mr. Casey at Geneva. The Minister has not answered and has not the means of answering the statement I made that in April 1954 the American Government approached the Australian Government for its approval and obtained it. That approval continued until the proposal was killed by the attitude of the United Kingdom and French Governments.

Mr J R Fraser:

– I draw to the attention of the House a case which I think illustrates a gross misuse of departmental power and a violation of the rights of the citizens. A Mr. G. Samuel was a permanent public servant employed by the Department of the Interior in Canberra. He submitted his resignation from the Department on 23rd March this year, the effective date of resignation being 4th April 1966. With his resignation he asked that all payments due to him be forwarded to an address in Melbourne, which he provided to the Department. The Commonwealth apparently continued to pay his salary to his account with the Canberra City branch of the Australia and New Zealand Bank Ltd., even deducting rent for the cottage he had ceased to occupy on 1 9th March - four days before he resigned. On 14th April - more than three weeks from the date of resignation - the Government paid into Mr. Samuel’s account with the Canberra City branch of the Australia and New Zealand Bank Ltd. his fortnightly salary. This included salary up to the effective date of his resignation and included also an overpayment from the date of his resignation to the end of the pay period. The cheque was cleared and the money was paid into Mr. Samuel’s account. Subsequently Mr. Samuel had his account transferred to the branch of the A.N.Z.

Bank at Kew, Victoria, and he discovered that an amount had been withdrawn from his account - in fact, an amount of SI 09. 16. He wrote to the bank on 16th May demanding to know on what authority this had been done without his consent and without any consultation with him. The bank replied by letter dated 24th May. lt regretted the delay in replying to his letter but claimed to have been awaiting formal advice from the Commonwealth Treasury to evidence that we have only acted upon their wishes”. The bank said that the Treasury had advised that the payment had been in error and the Treasury had requested that the amount be returned. The letter continued -

You will appreciate that the position was a difficult’ one for us but in view of the method of payment involved it was considered that we could only act in accordance wilh the remitter’s request.

I repeat that the cheque had been cleared and the money had been paid into Mr. Samuel’s account. The bank forwarded a copy of the letter it had received from the Treasury. This letter was signed by the Chief Finance Officer, Commonwealth SubTreasury, Canberra and stated -

Reference is made to the telephone conversation with Mr.- of your Bank concerning my letter of 15th April 1966.

You were requested to return the deposit of $109.16 on account of Mr. G. Samuel following an advice received in this office from the department with which Mr. Samuel was employed.

The Department of the Interior requested that the deposit for pay day 14th April 1966 be recovered. Any further information which may be required concerning this payment may be obtained by contacting the Chief Officer, Department’ of the Interior, Canberra, A.C.T.

Mr. Samuel was dissatisfied with the replies he received and he asked solicitors in Canberra to act for him. The solicitors wrote to the bank under date 16th June 1966 saying -

It now appears from a letter to him dated the 24th ult., that such action was taken without any authority but merely “ acting on the wishes of the Commonwealth Treasury”. It is most disturbing to say the least that your bank is prepared to act in such a clearly illegal manner merely at the behest of some official and our client takes the strongest possible exception to tha bank’s action.

On 18th May Mr. Samuel wrote to the Department of the Interior and asked under what authority the Department had withdrawn the money from his account with the bank. He wrote -

This is a very grave infringement of my private and personal property. Having discovered your mistake, the correct way would have been to contact me.

I want to ask the House and the Ministers who are here, and 1 want to ask, through them, the Treasury: What method was used to withdraw this money? Was a cheque drawn on this man’s account? If so, who signed the cheque? How was the Treasury request made? Was it a written request and if so who signed the letter? How was the money transferred from the bank to the Commonwealth Sub-Treasury? In the reply to Mr. Samuel’s letter of 18th May the Department of the Interior referred first of all to the fact that it had underpaid him previously. It regretted the deduction of rent beyond the date of his tenancy. In reply to his letter late in May the Department wrote -

  1. . arrangements have been made for you to be refunded the over-deduction and a cheque has been forwarded lo you at the above address.

That was a cheque for $11.79. The Department also admitted -

We have investigated your salary record and it was found that an increment due lo you on 9/2/66 was overlooked. However, arrangements have been made for you to be paid $44.26 representing the amount due for your increment. The inconvenience cause by this oversight is regretted.

The Department then referred to the withdrawal of money from this man’s private bank account with a private trading bank. This was not a case of payment being stopped on a cheque. This money was withdrawn from this man’s account. This is what the Department of the Interior wrote -

As mentioned in your letter a normal salary was paid into your bank on 14.4.66. This results from your resignation not being received in this office until 6.4.66, this date being too late to stop your salary by normal means for 14.4.66. A memorandum was forwarded to Treasury requesting that your salary be stopped, however, it seems that this request was not actioned and your normal salary was paid to your bank account. The Department of the Treasury advised this office that the money was in fact withdrawn from your bank, to save any inconvenience to yourself in repaying money to this Department.

I should like to ask: Where are we heading? What is happening in this country when a departmental officer can operate on the bank account of a private citizen? How is this done, and how is it justified? How can it be done? I want the Minister to answer this. 1 want the Treasury to answer (his. J think it is a gross action and a shocking violation of the rights of the individual that a departmental officer by some instruction to the management of a private trading bank can have money withdrawn from the account of a citizen. The proper course, if the Department had found it had made an overpayment, would have been to write to Mr. Samuel saying: “ We regret that we have made an overpayment and we ask you to refund us this amount “. Oh, no. This was not done. Instead there was a high handed, bureaucratic request or instruction to the manager of a private bank to withdraw money from the account of a citizen. In the Treasury’s own words: “ Money was in fact withdrawn from your bank “.

Mr Webb:

– What sort of bank was this?

Mr J R Fraser:

– It was a private trading bank. I named the bank because 1 do not want other banks to be slighted in this reference. 1 suggest that this is a case that should be answered by the Treasurer, and 1 hope that what I have had to say will be conveyed to him and that an answer of some kind will be given, because I do not see how any appropriate answer can be given.

Mr Kevin Cairns:

.- I am a little troubled that the Deputy Leader of the Opposition (Mr. Whitlam) is not here at present. I intend to raise a matter that concerns him. 1 ‘had a message conveyed to him through the Acting Whip of the Opposition and I regret that he has not come into the House to face this matter. Before the Parliament rose for the winter recess members of the House were severely troubled by two cases in which it was alleged that rooms of members of this Parliament had been entered and searched and in one case a report - “ Beef Road Development in Northern Australia “ - had been taken. The history of this event will illustrate the gravity of subsequent charges which the Deputy Leader of the Opposition made in public places at least three times in Brisbane on 27th May. Let us go back over the events. In this House on 28th April the honorable member for Macquarie (Mr.

Luchetti) said that his room had been entered and a report taken from his room. He said -

This excellent publication-

The beef roads report - was removed from my office between 9.30 p.m. and 10.30 p.m. last evening.

He went on to say -

This is a most serious matter, going far beyond the removal of a report.

Of course, every honorable member agreed with his statement. As he subsequently said -

Private correspondence between members and their constituents is not safe if this sort of thing can go on.

Subsequently, of course, Mr. Speaker, you made a statement on this matter. Then on 5th May the honorable member for Dawson (Dr. Patterson) came into this House and said that his room had been entered in the early hours of that morning and had been searched. As he sard then, it must be clear to all honorable members that this is a most serious matter. Nobody on this side of the House would disagree with him. His own Leader, the Leader of the Opposition (Mr. Calwell) agreed with him, and I know that you, Mr. Speaker, were concerned. We were delighted to find that the solution of this serious problem was given publicly by the Deputy Leader of the Opposition in Brisbane on 27th May. It was given at least three times on the eve of a State election. I would not suggest for one moment that the Deputy Leader was playing politics, even of an irresponsible kind, but let us look at what he had to say. His statement on that date contained no equivocation. It was most precise and one can only assume that he said what he meant to say. He was referring to the beef roads report and he said -

The Security Service got hold of Tony Luchetti’s copy and they searched Rex Patterson’s office for it but he had his at home. I don’t leave this one in my office. I am going to keep mine at home until Security come to repossess it.

Mr Killen:

– Who said this?

Mr Kevin Cairns:

– The Deputy Leader of the Opposition. I would not suggest for one moment that he was grandstanding, but here we have very precise charges and very precise allegations, and it is because of the seriousness of them that I informed the Deputy Leader, through channels, that this was to be raised tonight, or that a matter concerning him was to be raised. I subsequently wrote to you, Mr. Speaker, mentioning these charges. I told you what had been said and the dates on which it had been said, and you very kindly sent a letter to me after an investigation had been made, in which you said -

I have had inquiries made and am assured that neither A.S.I.O. nor the Commonwealth Police nor any member of either of those organisations was in any way responsible for or concerned in the incidents alleged by Mr. Whitlam and to which you referred.

I suggest that that was quite a precise reply.

Mr Clyde Cameron:

– You do not think they would admit it, do you? They used to deny telephone tapping.

Mr Kevin Cairns:

– You will have your opportunity to reply after 1 have finished - if you dare. The Deputy Leader of the Opposition has some grave allegations to substantiate, and he ought to substantiate them in this place because they concern the administration of this place. Above all I would suggest that he has a duty to reconcile his charges with your inquiries, Mr. Speaker. I know that the minds of the honorable member for Macquarie and the honorable member for Dawson are seriously troubled over this matter. It is a most grave and important matter, as they have said, and I suggest that the Deputy Leader of the Opposition has a duty to clarify their minds with respect to the report, a copy of which was taken from one office and in respect of which another office was searched by the Security Service.

Mr Bryant:

– Can you tell us the Security men who were interviewed?

Mr Kevin Cairns:

– I am asking the Deputy Leader of the Opposition to indicate the source of the information on which he has made the charge. He has made the charge, we have not. In fact the Leader of the Opposition, in referring to the case of the honorable member for Dawson, implied that there was something peculiar in the fact that only the rooms of members of the Opposition had been entered and that the rooms of Government supporters had not been entered. This fact apparently meant something to our alternative Prime Minister and we ask that his Deputy at least relieve the mind of the Leader of the Opposition in this respect.

As the honorable member for Macquarie indicated on the first occasion on which he spoke on this matter, this goes far beyond the taking of a report from a room. Every honorable member in this place needs to be free to function adequately and correctly. He needs to be free to realise that his correspondence and his confidential files are not going to be searched in the late hours of the night or the early hours of the morning, and every member, whether on this side or on the other side, should be reassured by the Deputy Leader of the Opposition and given the source of that honorable gentleman’s information which formed the basis of his allegations and charges. If the Deputy Leader of the Opposition in fact believes what he says he has a grave obligation with respect to the Security Service. The Security Service has been accused of quite nefarious activities and as our alternative Deputy Prime Minister the honorable number has an obligation to take whatever action he can in this place to see that the Security Service is either cleared or charged.

It is for all these reasons that I bring this matter to the notice of the House tonight. I regret that the Deputy Leader has not had the courage or the courtesy to come into this place and face up to the statements he made in public places in Brisbane at least three times on 27th May.


.- I do not think anyone can doubt the courage of the Deputy Leader of the Opposition (Mr. Whitlam) and I think the charges made by the honorable member for Lilley (Mr. Kevin Cairns) will be answered. I rise to mention the case of a constituent of mine named Neville Chapman. I am glad that the Minister for the Army (Mr. Malcolm Fraser) has extended me the courtesy of being present in the House tonight. Private Neville Chapman, who, as I said, is a constituent of mine, is the son of Mr. Frank Chapman of 79 Tennant Street, Bellbird, near Cessnock. Neville Chapman is one of eight children, his father being a former roadlayer in the mines in my electorate. The boy Neville is actually the third youngest of eight. At the age of four years he was run over by a motor bus and suffered some head injuries. He is at present confined in Holsworthy detention camp near Liverpool.

This young Australian applied to join the Army two or three years ago and was rejected on medical grounds. At that time it was his desire to take up a military career. Since then, on attaining the age of 20 years, he has been conscripted into the Army. At that time he was employed at the steel works of the Broken Hill Proprietary Company Limited in Newcastle. While in the Army he suffered a foot injury at Puckapunyal training camp and the foot was strapped up and he was transferred to Enoggera camp in Queensland. Not long after he arrived there his foot was examined by a medical practitioner who recommended that he be further examined and treated by an orthopaedic specialist. 1 understand that papers to prove that point are in existence.

Some two months after the recommendation was made for him to seek further or advanced medical treatment, which was not extended to him, he received four days’ leave. He came back home to Bellbird and failed to return to the camp. In other words, he went A.W.L. His father, who I believe is a reliable and trustworthy man, states that the boy had to lay up at home for some considerable time, that he could not get about much. He was at home for some two months before, 1 believe, the civil police executed an Army warrant on him for being A.W.L. I do not know why the Minister is laughing. I cannot understand that. After the boy was picked up and charged with being A.W.L., a court martial took place early last week. He believes that he was sentenced to 2S days’ detention; but the Commandant at the Holsworthy camp informs me that that has not been finalised.

I say, first, that I. believe that very unfair treatment has been meted out to this boy by the Army in not ensuring that an orthopaedic specialist examined his foot before he left the Army camp. Secondly, I inform the House that I visited the Holsworthy camp last Friday on my way home from Canberra and was extended the courtesy of seeing the lad in the presence of Major Stevens, the officer in charge of that camp. I found Major Stevens a courteous man. But when the boy was brought into the Commandant’s room he stood stiffly to attention all the time. I asked him to relax because I wanted to have a talk to him. I thought that should have been followed up by the Commanding Officer.

However, I asked the boy whether, if permission were granted by the Commandant, he would like to see me privately. Major Stevens said: “ No; you cannot have that permission because you are a visitor “. I would like to know from the Minister whether that is an Army instruction, because from my worldly experience I know that the crummiest bum lawyer is entitled to see a client in the presence of law enforcement authorities or even civilian gaol authorities and to converse with him in private, although a guard may be within sight of the interview. I do not think Major Stevens would have refused me permission unless it was an Army instruction or unless it was on advice from a higher authority. 1 recall the words of the former Prime Minister at his send-off dinner in this building. I remember him laying emphasis on the point that members of Parliament should always endeavour to maintain the status and dignity of parliamentarians. I believe it is grossly unfair that, when a member of the National Parliament seeks to interview a constituent and the constituent wants to see him privately, that privilege is not extended to him. If the present position is the result of an Army instruction, I trust that in fairness the Minister will see that it is altered. I do not think any member of this House would try to concoct a story for a detainee in a military establishment or give him cigarettes or weapons. That would be quite wrong. Therefore, I should have been able to interview the boy privately. I know he had a complaint about not receiving mail from his mother. Unless it was in accordance with regulations, I would hate to think that the Department of the Army would withhold mail from a boy’s parents.

The boy claimed that he jumped from a truck and suffered an injury. Major Stevens got him to a specialist earlier than would otherwise have been the case after my intervention and before I called there. Some honorable members of this House might have suffered a jarred heel which could not be detected by a medical practitioner. There are many injuries like that. Time will not permit me to elaborate on this case but this boy has a genuinely injured foot. An X-ray did not pick up the injury but I know of many cases similar to this. An X-ray does not always pick up broken bones or an ulcerated stomach. I have personal knowledge of these things. Often they are only detected in the morgue.


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

Mr Malcolm Fraser:

– I assure the honorable member for Hunter (Mr. James) that I shall look at every aspect of the case he has mentioned and will be in touch with him on this matter later.

Minister for Air · Fawkner · LP

– I assure the honorable member for the Australian Capital Territory (Mr. J. R. Fraser) that the matters raised by him tonight will be examined by the Treasury and in due course I will see whether anything further can be done about them.

Question resolved in the affirmative.

House adjourned at 11.27 p.m.

page 406


The following answers to questions upon notice were circulated -

Austraiian Forces Overseas. (Question No. 1930.)

Mr Whitlam:

m asked the Minister for Defence, upon notice -

  1. In which countries have elements of the Australian forces been stationed at any time in the last twenty years?
  2. Between what dates were they stationed in those countries?
Mr Fairhall:

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

Australian forces have been stationed in the following countries since 1946 -

Commonwealth Employees’ Compensation Act. (Question No. 1836.)

Mr Whitlam:

m asked the Treasurer, upon notice -

What progress has been made towards amending the Commonwealth Employees’ Compensation Act in accordance with the assurances given by his predecessor on the 9th November 1964 (“ Hansard “, page 2666)?

Mr McMahon:

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

The work of investigating the many proposals for amendment of the Commonwealth Employees’ Compensation Act, including the amendments that were submitted by the Opposition, and involving examination of the practices under other Suite legislation, has proceeded as expeditiously as possible consistent with the number of proposals for amendment and the claims of other issues upon the Department. Action will bc taken to introduce a Bill as soon as the necessary investigations have been completed and considered by the Government.

Australian Casualties in Vietnam. (Question N;>. 1952.)

Mr Daly:

y asked the Minister for Defence, upon notice-

  1. How many Australian servicemen have been (a) killed and (b) wounded during action in Vietnam?
  2. How many in each case were national service trainees?
Mr Fairhall:

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

Since Australian servicemen have, been serving in Vietnam (July 1962), the following casualties in action have been sustained:

Cite as: Australia, House of Representatives, Debates, 24 August 1966, viewed 22 October 2017, <>.