House of Representatives
24 August 1967

26th Parliament · 1st Session

Mr SPEAKER (Hon. W. J. Aston) took the chair at 10.30 a.m., and read prayers.

page 397




– The right honourable the Prime Minister will have noticed the very close association between industrial beneficiaries of tariff protection and the political fund raising activities of the Australian Country Party for the purposes of its new national headquarters. Does the Prime Minister approve the propriety of this situation?

Prime Minister · HIGGINS, VICTORIA · LP

– I have no knowledge of the fund raising activities to which the honourable gentleman has referred, but 1 have no doubt that throughout various parts of Australia there is an appreciation of the important role which the Country Party plays in ensuring good government in this country by its coalition with the Liberal Party.

page 397




– The Minister for the Interior recently tabled in this House schedules under the Representation Act. I refer him to schedule B which sets out the number of people in each State in the Commonwealth. I also refer him to the recent amendment to the Constitution which allows Aboriginals to be counted in the census. In view of the amendment, I ask the Minister: Do the figures he tabled include Aboriginals for the first time? If not, when will Aboriginals be counted in the fiugres certified by the Chief Electoral Officer under the Representation Act?

Minister for the Interior · RICHMOND, NEW SOUTH WALES · CP

– It is the normal practice after a census for the Chief Electoral Officer of the Commonwealth to make a fresh determination of the representation in the various States. A census was carried out last year and the final figures enabling him to do this would have been available in May this year. However, because a referendum was coming up, I asked the Chief Electoral Officer to defer making his determination pending the result of the referendum. The referendum was carried, enabling us to count Aboriginals in the census, so these Aboriginals were taken into account. These are the Aboriginals who live in the six original States of Australia. About 28,000 Aboriginals were counted, most of them being in Western Australia and Queensland. The addition of these numbers to the census figures did not affect the determination I tabled, but could mean that both of these States would have a better chance of retaining their present representation or of gaining an additional seat in the future.

page 397




– I direct my question to the Attorney-General. Has his attention been drawn to a statement by the Tasmanian Attorney-General to the effect that the Tasmanian Government will not consider compensating victims of crimes of violence until the Federal Government has decided its attitude on social service payments? Can the Attorney say whether he has received any proposition on this matter from the Tasmanian Attorney-General?


– I have not received a specific communication about this matter from the Tasmanian Government. The question of compensation to victims of crime has been discussed by the Standing Committee of Attorneys-General. but these discussions have dealt rather with the basis on which compensation should be paid, if at all. The House will be aware that in Western Australia, for example, it is given to victims of crime if they were attempting to assist the police. I think the impact of social services on this question would be a matter for the Minister for Social Services, who recently answered a question on the subject in this House.



Mr Speaker, might 1 take the opportunity to correct something which I said in my reply to the honourable member for Denison? I find that I have received a communication from Tasmania on the subject of compensation to victims of crime. That communication has been acknowledged and the matter is being considered at present. My previous answer in so far as it related to that was not correct.

page 397




– My question is addressed to the Prime Minister. I remind him that yesterday a number of mayors from cities and municipalities in country areas visited Canberra and the Parliament with the object of inducing responsible people to further the aims of decentralisation and to stimulate the growth of cities and towns in the country. The Prime Minister will recall that, following the Premiers Conference of July 1964, a Commonwealth and State officials committee on decentralisation was appointed. I understand that up till last year it had met twice. I ask the Prime Minister: Has the committee reported to the Government? If so, what is the nature of the report and does the Government intend to bring forward legislation to implement the findings of the committee?


– The latter part of the honourable gentleman’s question invites a comment on policy. 1 would not in a.ny event be in a position to make a policy statement on this point, even if this were the appropriate occasion for doing so. It is a fact that a committee of Commonwealth and State officials has been doing a good deal of work on decentralisation matters. But the House should not have the impression that policies which can usefully assist decentralisation objectives are held up pending the outcome of this inquiry. The House will be aware of the measures that the Government has put to the Parliament and which have been adopted by the Parliament and of other action of an administrative kind which has been designed to encourage decentralisation or to assist people living in country areas. I am not yet in a position to present a concluded report from the committee mentioned by the honourable member. It has not yet been received. However, I can assure the honourable gentleman that it is our desire to hear from the committee as soon as it feels able to report to us. When we receive the report, we will give prompt attention to anything that is put before us.

page 398




– I address my question to the Minister for the Army. What is the availability of Sheridan tanks for use by the Australian Army? What is the Army’s intention in relation to these tanks? Is there any useful alternative to the projected purchase of these tanks?

Mr Malcolm Fraser:

-The Army has for some time been interested in purchasing a modern and effective but air portable tank. For quite a time it looked - this is still the position - as though Sheridan tanks were the best and perhaps the only tanks offering that would meet our requirements. Because it needed to be air portable and because it also needed to have the fire power of a much larger and heavier tank, there were, and still are, problems with the conventional armament of the Sheridan tank. The Americans have been interested in this tank in two forms. In a guided missile form it is performing very well indeed. However, the missiles are very expensive and are more sophisticated than we would want for our requirements. There have been and there still are problems with the conventional guns for the Sheridans. The problem is to fit a gun with a large enough capacity and hard enough hitting power into a relatively small tank. Unless and until these problems are overcome we would not be able to order the Sheridans on a firm basis, although two of the tanks are still coming here for our own trials of the body of the vehicle. If the problems of the convential armaments are overcome and if the US Army also orders the tank iri this form for its purposes, the Australian Army would then want to purchase the tanks. No early solution to the problem however is expected.

page 398




– My question is directed to the Attorney-General. Is it the intention of the Government to bring down a Bill which makes the soliciting or collecting or transferring of funds to assist the National Liberation Front or organisations in North Vietnam an offence? Will the prohibition apply only to the sending of money? What will be the position in such matters as food and medical supplies? Will the Bill prevent organisations such as the Australian Red Cross from sending such things as food and medical supplies into North Vietnam, as I understand it is doing at the moment through neutral sources? Under the proposed legislation would an organisation such as the Australian Red Cross or any church organisation which wanted to transfer funds abroad for the purpose of sending food or medical supplies to North Vietnam be prevented from doing so?


– This matter is at present under the consideration of Cabinet. As it involves questions of policy I do not think I should deal with the detail which the honourable member has raised. However, it is expected that an early announcement will be made on this subject.

page 399




– Has the Minister for Primary Industry noticed reports indicating that wool prices have dropped by approximately 10% in recent weeks with serious results to woolgrowers? Has the Minister had an opportunity to discuss wool’s present situation with the International Wool Secretariat? If so, has the Secretariat given any indication as to what progress it has made and what benefit the grower might expect to obtain from its activities?

Minister for Primary Industry · FISHER, QUEENSLAND · CP

– The reports on the first three days operations of the wool sales which have just commenced indicate a fall in price of a full 7i% compared with the pre-recess sales. I think the principal cause of the weakness in wool prices which has been evident in recent months lies in the unfavourable economic conditions in the major wool consuming countries. The Governments of these countries, particularly the United Kingdom, West Germany and the United States of America, have adopted policies which have dampened the level of economic activity and restricted consumer demand. The honourable member will appreciate that the International Wool Secretariat cannot influence the economic policies of governments. However, there are signs that an incipient upturn is taking place in the economies of some of these countries. With regard to the question whether I was able to discuss this matter with the Secretariat, I had a full morning’s conference with Mr Vines and his experts in London. I am satisfied that the International Wool Secretariat is having a beneficial influence in all fields open to it. I am sure that if it were not for the campaign of the woolmark, prices today would be much worse than they are. The woolmark’s efforts throughout various countries, creating a consciousness of wool and a beneficial interest among textile manufacturers and the public, are all to the good. This is why T say that the position could be much worse but for the beneficial work that the Secretariat is doing.

page 399




– I ask the Minister for the Army a question supplementary to an earlier question about re-equipping the Australian Army with armour that can be carried by air. Why has the Australian automotive industry not been asked to design and prepare plans for such a tank? I understand that no such request has been made by the Government. I understand also that the Australian engineering industry, particularly the automotive industry, is one of the largest in the world. Would it not be possible to make Australia self-reliant both in design and manufacture of armoured fighting vehicles?

Mr Malcolm Fraser:

– It must be remembered that the Australian Army’s requirements for a tank of the kind referred to would be very small. The research and development costs associated with such a vehicle would be enormous, having regard to the number of vehicles which we would require. The honourable member is quite inaccurate in his statement that this matter has not been examined. He may remember that his late colleague, Mr Gray, put to me a proposal concerning a tank and a tank transporter. As a result of his representations to me on this matter exhaustive examinations were made into the possibility of building such a vehicle in Australia. If he were here the former member for Capricornia would be able to verify what I say. The costs and difficulties involved in the proposal were only too evident.

Mr Bryant:

– I understand from the automotive industry that no examination of this matter has been made.

Mr Malcolm Fraser:

– We have our Army design establishment. It and the Department of Supply maintain close and continuing contact with industry. The honourable member should bear in mind that of all the Army capital equipment purchased in the last year or two. 80% has been bought from Australian factories. Many of the items bought have been goods specifically designed for the Australian Army to meet its requirements. This shows clearly that wherever possible the Army cooperates, as do the other Services, in purchasing in Australia.

page 400




– I ask the Prime Minister a question. I have read reports concerning recent United States Senate decisions on its defence vote and allocations to the war in Vietnam. In view of the alleged internal opposition to United States involvement in Vietnam, is the Prime Minister able to give the House any information on the outcome of the latest debates?


– I have seen a Press report relating to the latest vote taken in the United States Senate within the last day or so. An amendment was moved seeking to reduce by 5% the total appropriation for defence purposes. On this occasion the amendment was rejected by 83 votes to 6. I am seeking some official confirmation of this and also some information regarding the final vote on the total appropriation. A note has just been handed to me.

Mr Bryant:

– Is it signed?


– Yes, it is signed by an officer of the Department of External Affairs, li states that it has been widely reported that the US Senate voted 85 to 5 against an amendment to cut by 10% expenditure on US defence projects. The note states that the vote reflected fears about doing anything which might impede assistance to the US Forces in Vietnam. The Department is seeking official confirmation from our Embassy in Washington and will let mc have it as soon as possible. This information seems to confirm that which I gave to the House last Thursday evening in my speech in the debate on foreign affairs.

page 400




– I direct a question to the Acting Minister for Trade and Industry. Has his attention been directed to allegations by Mr Coombs, the General Manager of the Queensland Butter Marketing Board, that the countries of the European Economic Community are dumping butter on traditional Australian export markets and to his claim that our export markets lor butler in Asia are being affected, with, for example, butter produced in the European Economic Community being offered in Singapore at a price more than one-third cheaper than Australian butter? Is it a fact that producers in EEC countries are able to maintain this very low export price by extracting from their governments a domestic consumer subsidy on EEC produced butter that compensates for any loss through export dumping at low prices? Will the Minister investigate this matter as a question of urgency to establish whether any action can be taken under the terms of the General Agreement on Tariffs and Trade against any Economic Community country, or any other country which is a member of GATT and which may be carrying out similar practices, to prevent this kind of practice which, if allowed to continue, will seriously dislocate markets for our dairy products-


– Order! The honourable member is now giving information. He should direct his question.


– I shall conclude by saying that these markets have been built up with difficulty and are important to the future of the dairy industry.

Minister Assisting the Minister for Trade and Industry · NEW ENGLAND, NEW SOUTH WALES · CP

– Although there was a considerable amount of verbiage in the question, I gathered that the honourable gentleman is concerned about the general inward looking philosophy and policies of the European Economic Community and their effect in particular on exports of primary products from EEC countries to markets in which Australia also is interested. The inward looking philosophy of the Economic Community is most pronounced, 1 think, in its agricultural policy, within which it is endeavouring to establish high protective barriers against the import of primary products from outside the Community, the subsidy paid being used to assist producers within the Community. The difficulty about this philosophy is that it means not only that countries such as Australia are affected but also that the less developed countries are given fewer opportunities to sell their exports of primary products. I understand that within the South East Asian region - the particular area with which the honourable member is most concerned - some members of the Australian dairy industry hope to find considerable prospects for the expansion of Australian exports. However, I am not in a position to say whether or not the honourable member’s statement about pricing is correct.

page 401




– My question is addressed to the Prime Minister. He will recall his expressions of a wish to see fair and free elections held in South Vietnam and of the importance that he places on the conduct of the approaching contest in that spirit. I ask: Has the right honourable gentleman received from the Government of South Vietnam or Air Vice-Marshal Ky any message relative to the conduct of the forthcoming elections in that country? If so, can he inform the House of the contents of the message?


– I gather that the Prime Minister of South Vietnam has sent messages about this matter to several governments. I have received one and I think the House would be interested to hear the text of what is a quite short letter, for it bears on a matter in which we all have a considerable interest.

Mr Bryant:

-r-‘Dear Harold: I have put through an electoral Act.’


– Would the honourable member prefer a letter from Ho Chi Minh? I suppose he would.

Mr Bryant:

– No. He works on the Playford system.


-Order! The honourable member for Wills will cease interjecting.


– This message is in the form of a cable, but I am told that the original letter was forwarded to me in an air bag which left on 23rd August. It reads:

Your Excellency, I have the honour to inform you that on the 21st August,- 1967, I have sent a letter to the President of the Senate and the Speaker of the House of Representatives of the United States, copy of which is enclosed herewith. The incalculable sacrifices which are demanded from all our nations for the cause of freedom in Vietnam cannot be vindicated unless our political objectives remain inspired by the noble dream of building a better society, to which we have subscribed. I have deemed it proper to reaffirm to the American Congress our commitment as Vietnam is on the eve of acceding to democracy, and I wish you to know that I constantly bear in mind the debt which my country owes you and your people for your invaluable support on our difficult road to success.

page 401




– My question is directed to the Prime Minister. Have instructions been issued that public servants are not to accept invitations to speak at public meetings without government approval? If this is so. is it not another move to place unreasonable restraints on public servants, and also an interference with civil liberty? Would the Prime Minister like to apply the same restraint to all those who dissent from the Government’s policies, including members of the Opposition?


– The honourable gentleman is or should be aware of the long-standing rule of practice, which applied in the time of the previous Labor Administration and earlier administrations, under which the respective roles of the Minister responsible to the Parliament, and the Public Service, with its administrative responsibilities, are clearly defined. 1 have clone nothing in my time to alter the situation. In fact, we have studiously avoided going as far as did a previous Labor administration which, it will be recalled, exercised its power of censorship in order to repress political comment in the newspapers of this country. This well-defined line of distinction exists between the role of the Minister in a responsible government or a responsible democracy - responsible in the sense of being responsible to the Parliament and the people who elect it - and those who are given the task of carrying out in an administrative way the policies of the Government. Quite clearly it is undesirable and inappropriate that members of the Public Service should engage in public controversy on political matters. I do not think the Leader of the Opposition would challenge that as a broadly stated proposition.

On the other hand there are circumstances in which it is desirable for senior members of the Public Service to explain administrative procedures, and indeed where policy is clearly defined to make known the application of that policy in an administrative way. I could give illustrations of this, of course, from the work of the trade commissioners in the Department of Trade and Industry. Quite recently when we were trying to educate the public as to the changes necessary on the introduction of decimal currency there was an organised campaign of public education and dissemination of information in which officers of the

Treasury played an active part. All that 1 have done during ray term as Prime Minister has been to note publicly this rule of practice. I did so at a Press conference on one occasion. To the best of my knowledge departments are, with very rare exceptions, consistently giving effect to what has been a long-standing rule of practice.

page 402



Mr Kevin Cairns:

– My question is directed to the Minister for External Affairs. I refer to the evidence of increased antiSemitism in the Soviet Union, especially since the Middle East crisis. Can the Minister give the House some details concerning the current position of Jews in the Soviet Union and will he request that the Australian representative at the United Nations bring this matter to the attention of its political committee?

Minister for External Affairs · CURTIN, WESTERN AUSTRALIA · LP

– I am bound to say that I am not aware of any evidence that the policies of the Soviet Union towards the Jewish residents of the Soviet Union have fundamentally changed since the Middle East crises. I would like to take the opportunity of saying that, from our information, the Soviet Union has exercised, recently at least, a restraining role in events in the Middle East and we are very glad to see it.

page 402




– My question is directed to the Minister for Labour and National Service and relates to a statement he made in the House yesterday concerning Government policy on the employment of married women. The Minister said: lt is further our policy, of course, to give married women more opportunities for working and to remove the obstacles in the way of their being employed.

I wish to ask the Minister three questions. Firstly, is this policy advocated to provide for the further extension of the two unit wage system for home upkeep because of the continued fall in home living standards at the purchasing power level? Secondly, does the Government propose to remove the obstacles to which he refers? Thirdly, is the pill to be put on the free list?

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

– Clearly, the last question asked by the honourable member should properly have been addressed to my colleague, the Minister for Health, who is a much greater expert on that subject than I am. In his first question, the honourable member implied that the standard of living was falling because it was being eroded by declining purchasing power. In recent times wages certainly have kept well ahead and as a result there has been a steady increase in the standard of living. As far as two unit income is concerned there is no doubt that, even if one income covered most expenses and was sufficient for the things which are desirable in households, many women still would work to enlarge the opportunity for their children to get a better education and greater opportunities in life. Large numbers of women who have brought up their families desire to enter employment in order to use their talents to the full, increasing the national income in the process. Steady progress has been made in removing obstacles to the employment of married women. I remind the honourable member that only last year we removed all obstacles to the employment of married women in the Public Service in regard to both recruitment and their remaining in the Service after marriage. There has been steady progress of this kind. If the honourable member can point out to me other suitable avenues in which I can carry out this policy, which has been pursued assiduously for some time, I will do my best to do so.

page 402




– I address my question to the Postmaster-General. Will he arrange for his Department, when providing RAX telephone services for a given number of subscribers, to assess the total cost, and before the location of the exchange building is announced, allow the subscribers to endeavour to arrange that they pay an equal share of the total cost? Does the Postmaster-General know that his Department would receive the same total amount for the service provided, and is he aware that if negotiations between the subscribers were successful, the anomaly of some subscribers paying many hundreds of dollars and others practically nothing for the same service would be rectified? The PostmasterGeneral may recall that I made this suggestion to him in writing about three weeks ago.

Postmaster-General · PETRIE, QUEENSLAND · LP

– I am not sure that all aspects of this matter can be covered in an answer to a question. I believe that anomalous situations would be created if the Department moved away from its present basis of negotiation with each individual. The honourable member, in common with other honourable members in this House, will appreciate the fact that the contract relating to the supply of a telephone is between the Department and an individual. If, in fact, some person who lived comparatively near to an exchange decided not to co-operate in a total operation and to wait until the exchange and lines were provided then he could avoid, quite readily, any contribution to the total cost. Obviously this would benefit people who were far removed from the actual exchange. When a person who was far removed from the exchange and who was not engaged in the initial negotiations came into contract with the Department, hew would the Department assess that part of the high cost, to which the honourable member has referred, which could be applied to that individual person? I believe that there is a considerable number of anomalies. I think that this matter requires to be looked at in detail. J will treat the honourable member’s question as being on the notice paper and wilt give him a detailed reply.

page 403




– Is the Attorney-General aware of the growing concern and criticism amongst Australian exporters relative to the soaring export shipping freight charges? Does Part X (a) of the Trade Practices Act provide for Commonwealth Government supervision of and participation in negotiations on shipping freights between exporters and shipping interests and for the registration of all applicable contracts? What action does the Attorney-General plan to put this legislation into operation, and when will it be put into operation? What are the reasons for the current delays?


– I am not aware of any growing dissatisfaction as to this particular part of the Act, as was suggested by the honourable member. As to the other comments upon it, I think I should remind the honourable member that this part relating to shipping is under the administration of the Minister for Trade and Industry. As to the commencement of the Act, I would hope that the honourable member was aware of the fact it has been proclaimed that it is to come into operation on 1st September this year. I cannot see that there are delays in this respect. The administration is complete. The offices of the Trade Commissioner are ready. The regulations have been issued. A handbook has been issued. I think that nothing further could be done than has in fact been done at this stage.

page 403




– My question is directed to the Minister for National Development. Is it a fact that the Government is considering the purchase of some of the latest fire bombing aircraft for forestry protection? If so, can the Minister say whether these aircraft will be made available to assist rural fire fighting organisations when circumstances permit?

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

– It is a fact that the Government has had under consideration the purchase of aircraft to carry out fire fighting, but until now no decision has been made either by the Forestry and Timber Bureau or by the Australian Forestry Council. The honourable member may recall that in answer to a question in this chamber some months ago I stated that forestry officials had visited the United States of America to see what aircraft were available for fighting forest fires. They reported that at that time no aircraft was considered suitable for Australian conditions. However, they pointed out that an aircraft was being manufactured and that it could very likely be suitable. I think it is called a ‘Canadair CL215’. It is an amphibious aircraft. I am now informed that this aircraft is just starting to come off the production line and will be tested in America next summer. Very recently I received a letter from the manufacturing company offering to lend two aircraft to the Australian Government or to the States for experimental purposes during the year 1968-69. I have not had an opportunity to look at this request but I will look at it and bring the matter to the attention of the Australian Forestry Council. As no decision has yet been made on this matter I cannot answer the honourable gentleman’s question further.

page 404




– My question is directed to the Attorney-General. Can he say whether or not the private or departmental telephones of honourable members are being tapped, as is suggested? Is the Minister aware that the Government’s assurances that this would not occur were received in good faith? Are those assurances now to be repudiated?


– It will be recalled that in 1953 the then Prime Minister, Sir Robert Menzies, stated in the House that members’ telephones had not been monitored - I think that was the word - and would not be monitored. That was at a time before the law covered this particular matter. Honourable members will also recall that in the Telephonic Communications (Interception) Act 1960 there was an absolute prohibition against the tapping of telephones unless the security of the country was involved. There were minor exceptions relating to technical Post Office matters, but that was the broad effect of the law. When the proposed Act was debated in the House the then AttorneyGeneral, Sir Garfield Barwick, specifically referred to the question of whether members of Parliament should be exempted from that security provision. He came to the conclusion that there should not be a specific exemption and stated that in the House. In fact there is no exemption. It therefore would not be appropriate to give the kind of assurance that could be given when the matter was not covered specifically by statute. I propose to follow the practice that has been adopted since as far back as the days of Mr Chifley and Sir Robert Menzies and neither affirm nor deny an assertion that any particular interception was involved. Once there is a breach of that rule then it will be impossible to stop it at that point. This must be quite, clear to honourable members. I propose to adhere to that rule.

page 404




– I should like to ask the Prime Minister a question without notice, ls it true that there are in course certain roadworks in the Australian Capital Territory that will pass the Prime Minister’s official residence, the Lodge? Is any action required by the Prime Minister or does any consent need to be given by the Prime

Minister to allow the works to’ proceed? If so, will the Prime Minister take that action or give that consent?


– Some time ago I was informed that because of alterations in the road system passing by the Lodge it would be necessary to move the road area much closer to that establishment. I raised no objection at the lime. Naturally, increased noise and traffic are not welcome to anybody but I have become rather accustomed to that as a main thoroughfare passes within a few feet of the front door of my home in Melbourne. The only recent reference I have seen to this matter was a report in a local paper, the ‘Courier’, today, headed in very large type The Lodge Must Go’.

Mr Bryant:

– The occupant must go.


– I was about to make the point that the honourable member anticipated. There are many honourable members opposite who keep assuring me. on virtually a daily basis, that the occupant must go, but I think the movement of the Lodge is about as unlikely as the movement of the occupant. I make it clear that I have placed no impediment whatever in the way of plans, which I understand are progressing, and if they bring the people closer to my door, I will not resist that. While I said earlier that I thought it unlikely that the Lodge must go, I do not regard my present occupancy as being of such indefinite duration that my health or peace of mind will suffer unduly. .

page 404




– I ask the AttorneyGeneral a question supplementary to that asked by the honourable member for Darebin. My recollection of the Telephonic Communications (Interception) Act is that telephones can be monitored only with the approval of the Attorney-General or of the Director-General of the Australian Security Intelligence Organisation, subject to report to and ratification by the Attorney-General. I ask the Attorney-General: Has he approved the monitoring of the telephones of any members of the Parliament?


– Dealing with the prefatory averment-


– Answer yes or no.

Mr James:

– I have had to answer yes or no.


-Order! The honourable member for Hunter will cease interjecting and the House will come to order.


– Dealing with the introductory material, J should perhaps say that the provision is that only the warrant of the Attorney-General authorises the monitoring of telephones but that if an application for a warrant has been made and the AttorneyGeneral is not available there is authority for the Director-General to issue a warrant. He has to report that he has issued the warrant which is operative for a period of not longer than forty-eight hours. As to the substance of the question, I must say that I propose to follow the procedure which has so long been laid down and which J believe to be the only satisfactory procedure in dealing with this matter. That is neither to affirm nor to deny whether a warrant has been issued in respect of a particular person or a particular section of the community.

page 405


Second Reading (Budget Debate)

Debate resumed from 23 August (vide page 392), on motion by Mr McMahon:

That the Bill be now read a second time.

Upon which Mr Whitlam had moved by way of amendment:

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

it places defence costs on those least able to pay them;

it fails to curb administrative waste and extravagance;

it defers and retrenches development projects; and

it allows social service and war pensioners to fall still further behind their fellow citizens “.


– This Budget is condemned because of its failure to correctinequities of the social service system and to recognise, even in the slightest degree, the injustice inflicted on wage earners by the fact that prices soar while wages sag. The words of the Treasurer (Mr McMahon) depict the Budget as one that takes care of the few and neglects the needs of the many. It is true to say that the assertions of the Prime Minister (Mr Harold Holt), the Treasurer and honourable members on the Government side that the country’s economic affairs have never been better or the community more affluent gave the pensioners and the family men - indeed, all those who face the problem of existing on the contents of their pay envelope - cause to hope that the Budget would contain some help; but none was forthcoming.

In 1949 Sir Robert Menzies said:

The pensioners can rely on us for justice.

He meant that the pensioners could rely on the Liberal Party. In 1967, 18 years later, the pensioners are still demanding justice from the Liberal Party, which forms the Government of today. I recall the present Prime Minister, when he was Treasurer, presenting a budget and saying that it was the desire of his Government to see that everyone obtained a fair share of the gains of progress. Since 1949 pensioners, the low wage earners and the family men have been waiting for their fair share to arrive. They are waiting for their share of the increased prosperity that the Government says we now enjoy. They have been waiting since 1949 and they will continue to wait while this Government remains in office.

Recent surveys have proved beyond a shadow of doubt that thousands of pensioners are living in a state of poverty. Poverty also extends into the homes of the many low wage earners. It has been proved beyond a shadow of doubt, too, that one pay envelope is not enough for a normal existence in this day and age. No-one can deny that retired persons, whose incomes are fixed, are finding it extremely difficult to live with the ever increasing price spiral of today. All honourable members will have received last Tuesday a circular from the Australian Commonwealth Pensioners Association. I will read it and I hope that during the Budget debate and also during the debate on the Estimates, it will be read again and again. It states:

To Members of Parliament and the Senate.

Dear Sir/Madam.

The 1967 Budget will go down in the history of Australia as the blackest budget for pensioners ever introduced by a Federal Treasurer.

The Federation has called on all pensioners to protest by going into mourning for one year, and to wear black arm-bands with the wording - ‘Give us this day our daily bread’.

As each member of the House, and the Senate, stands for the Lord’s Prayer, the Federation desires each representative of the people to reflect deeply in their conscience on those words - ‘Give us this day our daily bread’, and to realise that the consequence of the Black Budget of 1967 is to condemn many thousands of Australia’s aged, infirm, and widowed to malnutrition and starvation - subsequent illnesses and possible death.

The circular concludes with these words:

A malnutrition Budget for pensions. The worst and most disgraceful Budget ever introduced by this Government - pensioners are left for dead.

No consideration to the steep rise over the past year in the consumer price index and the general rise in the cost of living shows the policy of this Government for the present generation of pensioners, who, during their lifetime experienced two world wars and depressions, and who were unable to add to their means, and now exist on their meagre pensions - the Government want this section to die off.

We call on all pensioners in Australia to unite and protest against this malnutrition Budget, and all trade unions to use the strongest measures to support the pensioners, and all persons of goodwill to help us in our fight for justice.

I think it is true to say that under this Government there is no, ray of hope that even in the distant future the situation will change or that there will be an abolition of the means test. As far back as 1949 the abolition of the means test was spoken about. One would have expected in these affluent times that some measures would have been taken to bring this about progressively. Public servants and others on superannuation were dismayed and their hopes in this regard were rudely shattered when the Budget was presented. The Government certainly pays lip service to the abolition of the means test, but it does nothing to introduce provisions which will bring this about. Its attitude to the means test makes a mockery of thrift and the thrifty. It makes one feel that the Government’s thinking is based on a situation which existed in the dim dark ages when a person who received a pension of any kind was regarded almost as an outcast of society. Perhaps the least that can be said about social services is that the Government knew that its Budget would bring severe criticism and, in an attempt to stifle criticism, it threw out a crumb in increased child endowment. In 1949 Mr Menzies, now Sir Robert Menzies, said:

Australia still needs a contributory system of national insurance against sickness, widowhood, unemployment and old age. It is only under such a system that we can make all benefits a matter of right and get completely rid of the means test.

During the new Parliament we will further investigate this complicated problem with a view to presenting to you at the election in 1952 a scheme for your approval.

Yet today figures show that only five out of every eleven persons of pensionable age are eligible to receive pensions because of the means test. Civilian widows and wives of age pensioners who are not of pensionable age, are not even considered as being due for consideration in these affluent times.

I turn now to the drug industry. This is another field which drastically affects the pensioners, as indeed it affects all those who have the burden of expensive drugs. However, it is not my intention to refer to the price of drugs. Suffice it to say that it costs so much to be ill these days that people cannot afford the luxury. The menace of drugs causes me concern at the moment. I refer to a question asked by the honourable member for Fremantle (Mr Beazley) last Tuesday about the hallucinatory drug LSD and the reply given by the Minister for Health (Dr Forbes) to the effect that he had not seen the report to which the honourable member had referred. He said that he would look into the matter and give the honourable member a detailed report. I should like to know what the Minister’s staff is doing if it has not brought this matter to his notice. I should like to refer also to a question about drugs which I addressed to the Minister for Health on 16th March this year. I asked:

  1. Has his attention been drawn to the statement made by Dr Lionel Jacobs that the drug phenacetin which has been banned from the free medical li-t has caused 200 deaths in the last 4 years?
  2. What assurance can he give the public that the drug paracetamol will not have side effects similar to those of the drug phenacetin?
  3. Has his attention also been drawn to the statement of Dr Bauer of Sydney that pain killing drugs sold over the counter could kill people with high blood pressure?
  4. Is it a fact that an antibiotic drug called tetracycline is causing serious discolouration of teeth, particularly among children, and has it also had the effect of causing bone brittleness in children, making them prone to broken limbs?
  5. If the position is as stated, does it warrant a full scale inquiry being conducted into the drug industry?
  6. Failing this will he take action to compel the drug industry to set up an indemnity fund in order to compensate the victims of the side effects of drugs and the relatives of those whose lives have been lost from the effects of drugs?

The Minister replied:

  1. I am informed that Dr Lionel Jacobs made no statement in the terms mentioned by the honourable member. However, in a recent television interview he stated in effect that he had, since 1962, experienced a ‘personal series’ of over 60 deaths associated with excessive consumption of phenacetin

The newspapers reported more than 200 deaths. But this was only the experience of Dr Jacobs. What must have been the experience of many other doctors? The Minister continued:

  1. The Pharmaceutical Benefits Advisory Committee has recommended that paracetamol be provided as a pharmaceutical benefit and I am sure that the Committee had full regard to all available information regarding the side effects of drugs in making its recommendations.
  2. Yes. I have asked my Department to arrange for a thorough investigation of the whole matter to which Dr Bauer is reported to have referred.

I have heard nothing about the investigation since I asked the question. The Minister continued:

  1. It is a fact that the antibiotic drug tetracycline can cause discolouration of the teeth, particularly among young children, and may inhibit bone growth, particularly in premature infants. These side effects have received wide publicity and have been drawn to the attention of medical practitioners on numerous occasions over a considerable period. Apart from warning articles published as early as 1963 in . . . overseas publications such as ‘The Lancet’ and the ‘British Medical Journal’-

The Minister referred to the publication of medical journals up to February 1967. The answer continued:

This matter has also received wide publicity in other professional journals and in the Press. Moreover, an article on the side effects of tetracycline is contained in the current issue of the ‘Prescriber’s Journal’, published by my Department. 5 and 6. It is a well known fact that the taking of many drugs involves risks. However, the risks must be balanced against the therapeutic advantages and this is a matter for the prescribing doctor’s judgment. The Commonwealth Government has endeavoured to ensure that all doctors are informed of the possible adverse affects of drugs and has established the Australian Drug Evaluation Committee for this purpose. I therefore do not propose to sponsor an inquiry into the drug industry on action to compel the drug industry to set up an indemnity fund. 1 asked for a national inquiry into the drug industry. The Minister refused. He admits, or at least does not deny, that phenacetin has been responsible for sixty deaths. Apparently death by prescribed drugs or advertised drugs is of no consequence. It is my opinion that if a drug causes only one death that should be sufficient for an inquiry to be held. I also asked the Minister to take action to compel the drug industry to establish an indemnity fund in order to compensate victims of the side effects of drugs and the relatives of those whose lives have been lost due to the effects of drugs. This also was refused.

I turn now to a statement made by the Minister for publication in the ‘Medical Journal of Australia’ of 1st July 1967. The statement refers to restrictions on barbiturates as pharmaceutical benefits. Among other things the Minister said:

In Australia it was also a fact that a very large proportion of accidental and suicidal poisonings resulted from ingestion of high strength barbiturates. In 1965 the number of deaths in Australia from accidental poisoning by solid and liquid substances was 219 and of these 153 deaths were due to poisoning by barbiturates. Corresponding figures in 1961 were 144 deaths, of which 71 were due to barbiturates - deaths from barbiturate poisoning thus having more than doubled in the 4 years.

In other words, these facts have been known for four years, yet no action has been taken until 1st July this year and still the Minister has refused to have an inquiry into the drug industry.

I turn now to an article which appeared in the Melbourne ‘Sun’ on 2nd March this year. It reads:

A ‘wonder drug’ with SI million sales in Australia each month is causing serious discolouration of teeth.

In Melbourne alone, the discovered cases of discoloured teeth after use of the drug were numerous and widespread, Professor Elsdon Storey said at the Australian Dental Congress yesterday.

He said the drug - an antibiotic, tetracycline - was prescribed extensively for children suffering bronchitis and other upper respiratory diseases.

Of 1,000 teeth extracted from children in the Melbourne Dental Hospital, 82 per cent showed tetracycline staining, he said.

Of a further 303 patients, 16 per cent had discoloured teeth and 4 per cent had abnormal enamel formation on their teeth.

Professor Storey said discolouration would be permanent, but the effect of the drug on the enamel would not be known for several years.

Tetracycline had been on sale since 1956.

Professor Storey said he reported the dangers of the drug in 1959.

The National Health and Medical Research Council also had warned doctors of the dangers of its use, and had advised the use of alternative antibiotics.

But the drug had still become one of tha largest sellers.

He said the solution to tetracycline staining of teeth, pending further research, would be for the Commonwealth Health Department to make culture and sensitivity testing mandatory before prescribing tetracyclines for children under four.

But nothing has been done. The Minister has told us nothing in this regard. No warnings have been issued to the public. In spite of these reports the Minister tries to comfort everybody by saying that the Drug Evaluation Committee watches these things closely. I say in all sincerity: Thank God for the Drug Evaluation Committee. The Minister has stated that doctors are informed on these matters per medium of the various medical journals. But how many members of the general public read those journals? How is the warning given to the human guinea pigs? Is it given per medium of questions asked in this House or reference to these matters in the newspapers? If it is given through the newspapers, I fear for the public. Surely the Minister has not forgotten the thalidomide disasters. Is not the pill now causing concern?

In answer to another question that I asked, the Minister said that the pharmaceutical industry, as well as the medical, dental and nursing professions, had responsibilities concerning the undesirable effects of drug therapy. I agree, but what about those who are concerned not with responsibility but only with profits? Let me refer to some overseas comments about profits. I refer to an article published in the September 1966 issue of ‘Consumer Bulletin’, which is published by Consumers’ Research, Inc., Washington, New Jersey. The ‘Consumer Bulletin’ is said to be an ‘unbiased analysis of products by brand name since 1928.’ This edition features an article on aspirin headed Aspirin - Major menace to health in both old and young.’ The article reads:

Aspirin is often in the news, usually because of the poisoning or death of children. Nearly 13,000 cases of poisoning with aspirin tablets of children under five took place in a single recent year. Of the 13,000, 125 died from their experience with aspirin or a closely related product.

The consumption of aspirin is prodigious. In the United States well over 20,000,000 pounds, equivalent to 28,000,000,000 5-grain tablets, are consumed yearly.

Aspirin is not a safe drug, and it should not be taken except as advised by a physician. It is deleterious to the blood vessels, may even cause nosebleed or haemorrhage of the eyeball, and chronic nasal symptoms . . .

Aspirin can be critically dangerous for peptic ulcer patients.

The danger associated with the taking of aspirin by young children is obvious. This is a matter that concerns all of us. The article continues:

Disarmed by advertising that shrewdly implies that aspirin is harmless, and usable in all sorts of trivial illnesses, people sometimes risk their health by frequent doses of aspirin. Or they may endanger the life of a young child by giving the drug . . .

Latest trends in the aspirin business include pushing markets for flavoured children’s aspirin. Retail marketers have also introduced aspirin dispensers, which deliver one tablet at a time, similar to dispensers widely in use now for artificial sweetener tablets.

This increases the danger as far as children are concerned. The article goes on to state:

Medicine bottle caps designed to foil the prying fingers of a five-year old have often been considered too expensive for general use.

In this morning’s newspapers, we were able to pick out a statement made by a Dr Butterworth, which was reported under the headline ‘Pill coating is urged’ in these terms:

A bitter, or unattractive, coating should be put on tablets to deter children from eating them.

The report quotes the dangers. Do we see any warnings about this issued by the Minister? We hear from him no indication of what is going on. We are left to get our information from statements made in the Parliament or reported in the ‘Medical Journal of Australia’, which members of the public do not read. The Government does not go to any trouble to try to warn the public. As I have said, the only statements about these dangers that we read are those that we may discover from time to time tucked away in the corners of the newspapers.

I turn again to the attitude of the Minister concerning the use of drugs. One may well be led to believe that in his opinion a person is free to poison himself if he wishes to and that any attempt to prevent him from doing this is a violation of his personal liberty. It may be of interest to note that a commission of the United Nations Economic and Social Council, in September 1966, declared: . . the Commission, recognising the fact that a number of governments do not at present consider that they have a problem of drug abuse on their territory, and that this may prove to be a dangerous delusion especially in view of the growing abuse of such drugs as barbiturates, amphetamines, tranquillisers and hallucinogenic. -

Those are hallucination drugs - recognising also the fact that in a number pi countries certain groups tend to either minimise the seriousness of the problem or even negate the responsibility of the government and of society as a whole in combating it, may wish to consider the possibility of doing what the Chairman of the Committee on Substances not under International Control advocated during the meeting of that Committee, namely, make a ‘resounding declaration’ of principle in this respect. That Committee recognised once more the importance of public opinion and of all the mass media of information and endeavoured with a large measure of success to have as broad a coverage as possible of its activity by these mass media. The Commission may wish to give similar expression to a set of principles, which might prove very useful coming from such a responsible body, to those governments and to those parts of public opinion which do not realise the seriousness or the potential danger of drug abuse. Such a declaration would insist on the dangers to the individual and society of any consumption of such drugs apart from medical need and outside medical guidance, and stress in terms that the public may easily understand the need for society to prevent or stamp out this abuse.

Since that report, in its last few words, endeavours to point out that prevention is better than cure, I ask: Why does the Minister refuse to have an inquiry into the activities of the drug industry in this country? Why does he refuse to establish an indemnity fund to compensate victims and the relatives of those who have lost their lives through the use of prescribed drugs? The inactivity of the Government and the Minister in this regard can be taken only, as an indication that they regard the drug industry as too powerful to challenge. This is a craven attitude. I recognise fully the great value that prescribed drugs have been to the community in general throughout the civilised world. I repeat once more that they have been of great value. But in relation to the case that I submit, I point out that a person can be proceeded against in a criminal court for the poisoning of a dog. I am at a loss to understand why drug companies, intent only on making profits, can put on the market a drug that cannot be prescribed as 100% safe for human consumption and escape the processes of the law when it is proved beyond a shadow of doubt that a person has been seriously affected by the side effects of that drug or has lost his life because it was prescribed for him.

Only yesterday, the Press informed us that the Commonwealth Government and the New South Wales Government were investigating the high profits made by international drug manufacturers and pharmaceutical companies in the supply of drugs to the public. The Minister denied that report. He said it was false. However, as the Government is under pressure by critics not only in this House but throughout the country for its overspending, it is only natural for the Minister to try to defend the Government on this issue. He said that the report was false and added: We are concerned about the cost involved in the overuse of drugs’. I too am concerned, Mr Deputy Speaker. The report about the investigation by the two Governments mentioned practices of the sort that are being adopted by the drug industry. It ended on this note:

One authority said: ‘Australia is the laughing stock of the medical health authorities in Canada and the United States. Those two countries refuse to subsidise the supply of drugs by trade name.’

That is a significant statement, Sir. It confirms my view of the Government’s attitude towards the use of drugs. I emphasise that concluding statement in this report. This Government allows that sort of thing to go on, and in fact encourages it. Indeed, it even allows Australians to be used for the benefit of the drug companies as human guinea pigs.

Mr Curtin:

– The drug companies are Liberal supporters.


– That is right. They also advertise in the newspapers, and that is why these matters receive no publicity. In my view, this is not justice. I am sorry to say that this Government has not the courage to see that justice for the community prevails. I condemn this Budget for the reasons that I have stated, and I support the amendment proposed by the Leader of the Opposition (Mr Whitlam), which is in these terms:

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

it places defence costs on those least able to pay them;

it fails to curb administrative waste and extravagance’;

it defers and retrenches development projects; and

it allows social services and war pensioners to fall still further behind their fellow citizens’.

Minister for the Navy · Higinbotham · LP

Mr Deputy Speaker, I compliment the honourable member for Gellibrand (Mr Mclvor) on most parts of his speech. In his customary fashion, he has done an enormous amount of research in its preparation. Though I cannot agree with some of the things that he said, I acknowledge that it was a thoughtful speech. .


– The main thing is that the Minister agrees with some of it. I am glad to know that I have one sympathiser on the Government side of the chamber.


– If I may say so to my honourable friend, it was less than worthy of him, after having put so much thought into the preparation of his speech, to suggest that the only reason why the Government does not challenge the drug industry is that the industry is too powerful. Then, in response to some assistance by his friend, the honourable member for KingsfordSmith (Mr Curtin), he made the ridiculous allegation that the drug companies are supporters of this Government and that that is the reason why we take no action against them. I have no doubt that my colleague, the Minister for Health (Dr Forbes), will deal with those charges in due time.

This morning, Mr Deputy Speaker, I would like to discuss two aspects of the speech on the Budget made by the Leader of the Opposition (Mr Whitlam). These are his criticisms of the economic situation prevailing in Australia at present and the statement of his attitude towards defence, in particular our defence commitments and involvement in Vietnam. I would like to take the opportunity also later in my speech of dealing with one or two specific aspects of developments in the Royal Australian Navy.

The Leader of the Opposition, dealing with the present economic situation, featured in his speech such phrases as downswing in economic trends’ and sluggishness of the economy*. He said he was ‘disturbed that the gap between actual output and potential full capacity output has widened steadily for two years.’ The period Of two years is significant, as I shall demons trate in a moment. The honourable gentleman suggested with some logic - and here I agree with him - that two of the best indicators of whether this gap that he speaks of is widening or narrowing are the numbers registered for unemployment at a particular time and the job vacancies registered at a particular time, both expressed as percentages of the work force. No one can quarrel with the statement that these are two reliable indicators of economic activity in a community. But it is significant to look at the reason why the Leader of the Opposition chose 30th June 1965 as the point of time on which to base his comparisons. He knows - if he does not know he ought to know, but I am sure that he does know - that if we look at the economic conditions prevailing throughout the last ten years, 1965 was a boom year, and 30th June 1965 represented the high peak of business and economic activity during the ten-year period. In fact in that boom year demand pressures were quite apparent, and the number of registrations for employment was at such a low level and job vacancies registered were at such a high level that inflation had begun to manifest itself. I do not think anybody can quarrel with that statement. So it is hardly logical to compare economic activity at various times over a period of ten years if one takes a boom year as the base for comparison.

In fact, in terms both of unfilled vacancies and persons registered for employment 30th June 1967 represented an approximate mid-point between the comparative recession of 1961 and the boom conditions of 1965. I am sure the honourable member for Melbourne Ports (Mr Crean), the honourable member for Yarra (Dr J. F. Cairns) and other experts on economics on the Opposition side will agree with me when I say that the most sophisticated economic devices of the Western world have as yet been unable to eliminate altogether the swings of the longer term business cycle, particularly over a ten years period.

So we find ourselves at this point of time, or at 30th June last when the figures were taken out, at a mid-point between the comparative recession of 1961 and the boom conditions of 1965, and this is a situation, I suggest, that certainly does not give any cause for alarm. In five of the past ten years the unfilled vacancy level was actually lower than the level of July 1967, and in four of the past ten years the unemployed registration figure has been higher, and considerably higher in the early 1960s. For this reason I do not think we should share the concern of the Leader of the Opposition at what he calls downswings and sluggishness in the economy.

I think the House should also be grateful to the honourable member for Lilley (Mr Kevin Cairns), who is an acknowledged student of economics and statistical research, for giving figures in his speech to the House concerning the growth rate in Australia over the past five years. These figures were extracted from statistical documents and I am looking forward with some interest to the speeches of the honourable member for Melbourne Ports and his colleagues, to see whether they consider these figures should be challenged. On this concept that I am introducing of looking at the economic policy of a country over a number of years and not necessarily at a particular point of time I believe these figures are significant.

The honourable member for Lilley recalled that in 1963 this Government made an election promise to raise gross production by 25% within five years, a quite ambitious promise which at that time was attacked by the Labor Party which said that it was completely incapable of fulfilment by this Government. Well, five years have gone by. Let lis see what results have been achieved. The honourable member for Lilley has referred to these results as being at constant prices. I emphasise that. The meaning of the term will be known to honourable members opposite. In 1962-63 there was an increase in gross production, at constant prices, of 6%, in the next year 6i%, in the following year 61%, and in 1965-66 the increase amounted to 1%. Honourable members will be quick to realise that the reason for this drop was the savage drought that this country experienced during that year. Notwithstanding that drought unemployment figures were kept at extremely reasonable levels considering the complications that the economy was suffering from.

The figures showing the growth rate for the past year, 1966-67, have not yet been produced, but I will stick my neck out and suggest that the figure would be between 5% and 6%. If it is 6% the growth in gross production over the past five years has not been 25%, as was promised by the Government, but 26%. I think this is quite a remarkable achievement in economic performance. It is fair to examine a particular budget, as the Leader of the Opposition has done, in isolation as a.n economic instrument used annually, but surely it is fairer to assess and criticise or appraise a government’s economic policy and performance over a period of five or ten years. This is the acid test.

There was one strange aspect of the Leader of the Opposition’s speech to which I should refer. The only reference that I could find in it to the Australian involvement in Vietnam was that reported at pages 298 and 299 of Hansard, in which he made the rather astonishing allegation that pensioners are bearing the burden of the war. Throughout his whole speech this was the only reference he made to Australian involvement in Vietnam. On the other hand, his speech was liberally laced with criticisms of Government defence policy. One might have expected with some logic and reason that the Leader of a party which professes to be an alternative government would have recognised the interdependence of the two issues, defence and our involvement in Vietnam, and would have spoken about it in his Budget speech. I remind the House also that the total defence vote for this year is $1,1 18m, which represents 17% of the total budget. Of that total an amount of some significance is being devoted to our involvement in Vietnam. Why then was there no reference made, except this snide reference to pensioners bearing the burden, to our commitment in Vietnam?

In fact, if I may say so, there seems to have been a singular reluctance on the part of members of the Opposition to discuss foreign affairs and particularly Vietnam during this Budget debate and. indeed, during the foreign affairs debate of last week. The honourable member for East Sydney (Mr Devine) seemed to sum up the attitude of honourable members opposite when he said last night that Government members can get up and speak on foreign affairs because it suits them. The inference was, of course, that members of the Opposition do not want to get up and speak on foreign affairs because it does not suit them. If that is not the logical inference I do not know what is.

It is fair to ask: Why this reluctance by the Leader of the Opposition to discuss defence and Vietnam in relation to the Budget? Could it be that he finds himself in an embarrassing position because of the decisions of the recent Adelaide conference of the Labor Party? Let me go back and recall to the House the words of the honourable member for Melbourne (Mr Calwell), who was then the Leader of the Opposition, in his election campaign speech, which was delivered only a matter of some months ago. He said: we will act in consultation with the American authorities, immediately we become the Government, to withdraw all conscripts in Vietnam. Our first act as a government will be to abolish conscription and give orders that all conscripts in camp in Australia shall be discharged forthwith.

The remainder of our troops will be brought home at the earliest practicable moment after consultation with our allies and not so as to endanger the lives of any Australian or allied troops.

This statement was basic, clear, uncomplicated and capable of being understood by everybody. Since becoming the Leader of the Opposition, the present leader has made certain statements concerning the policy of his Party on Vietnam. He said: ‘We do not believe in unilateral withdrawal of troops, by the Americans, by ourselves, by the North Vietnamese, or by anyone else’. He has made several other statements which indicate that he believes that the policy of the Labor Party, as espoused by its former leader, should be reappraised. On several occasions he has indicated his basic disagreement with the earlier policy of the Labor Party on involvement in Vietnam. We waited for the big moment when the Leader of the Opposition, flushed with success by the result of a recent by-election and if I may say so, after an extraordinarily successful personal Press relations campaign, went to make his impression on the governing body of the Labor Party at the Federal Conference in Adelaide a few weeks ago. What sort of speech did he make? All of us were waiting to find the content of this powerful speech. We were interested to learn the advocacy he was going to make concerning a change in policy. So far as we known he made no speech at all. During a two hour debate the Leader of the Oppo sition sat silent while party policy makers passed the following resolution concerning policy towards the Vietnam war I consider it to be a monstrous policy. This policy states:

The ALP, on achieving office, will submit to our allies that they should immediately -

cease bombing North Vietnam;

recognise the National Liberation Front al a principal party to negotiations;

transform operations in South Vietnam into holding operations thereby to avoid involvement of civilians in the war, cease the use of napalm and other objectionable materials of war . . .

That expression fascinates me. What is not an objectionable material of war and what is? That particular term of reference is so wide as to be capable of any kind of interpretation. The policy of the Australian Labor Party further provides:

Should our allies fail to take this action, the Australian Government would then consider that it had no alternative other than to withdraw our armed forces.

The shock defeat that the Leader of the Opposition suffered at the Conference did not deter him from continuing to make sugar coated statements about Labor policy. As late as 5th August of this year he was reported as making on the television programme ‘Four Corners’ what must be one of the most extraordinary statements ever issued by any pretender to Prime Ministerial office. He said:

Since I have become Leader I have stressed that we should strive to end this war, and since we are America’s only respectable ally we could be very effective in bringing this about.

I wonder what the Prime Minister of New Zealand thought when this was communicated to him? What did the gallant people of South Korea, Thailand and the Philippines think about it? Also, what would the other countries of Asia, which are giving non-military aid and which have made treaties with the United States, and can rightly consider themselves as allies of America, think about their being regarded as non-respectable? If anyone wanted to use a more offensive remark or deliver a more calculated affront to the countries of Asia he could have done no better than the Leader of the Opposition.

The stark, horrid facts are that it is true that Labor policy under the new leader is not the same as it was under the old leader. It is much more insidious and sinister, because no longer does the Leader of the Opposition come out honestly and state fairly that on gaining office there would be a unilateral withdrawal. Ari element of blackmail has now been intruded into the policy. A Labor Government would presumably go to the Americans and say: ‘You must cease bombing North Vietnam, a country from which we know aggression emanates. You will allow the Vietcong to be equipped and fed, clothed and armed by the North Vietnamese in the fight against our own troops’. Secondly, it would say to the Americans: ‘You must recognise the Vietcong - a group that is notorious for its torture, insurrection, and murder of innocent civilians, and whose stated policy is that the only solution to the South Vietnamese problem is for total control by the National Liberation Front.’ Thirdly, the Labor Party would say to the Americans: You will no longer continue to pacify the country. You will restrict your movements to “holding operations” ‘ - whatever that means - ‘on the assumption that the other side will do the same.’ In short, the new policy puts to the Americans a set of conditions which the Labor Party knows perfectly well will be unacceptable to the Americans. Only after that hypocritical skirmish will they withdraw Australian troops. In other words, the old policy was at least basically honest, although basically wrong, lt said: ‘On gaining office we will withdraw our troops’. The new policy under the new leader says: Let us withdraw the troops’. However, it adds: ‘Before we do that let’s deal our American and other allies a humiliating, embarrassing and devastating blow to their prestige in South East Asia’. I believe this is the difference in the two policies of the Labor Party.

The Leader of the Opposition paid particular attention to criticism of the defence services. The Navy, of course, did not escape his attention. Because of this and other criticisms in the debate on the urgency motion which took place in this House on Tuesday last, and because of the current interest of some of the nation’s newspapers in this question, I thought it would be useful to inform the House of the present position concerning some important projects in the Navy’s ship conversion programme, and of its programme generally. The first matter concerns the two

Daring class destroyers, HMAS Vampire and HMAS ‘Vendetta’, which were planned to undergo a half life modernisation beginning in mid- 1968 and continue through to mid- 1971. Apart from a comprehensive updating of existing facilities in these ships, it had been intended to improve their antisubmarine capability by the installation of the Ikara system. This would have necessitated some reduction in their gunnery armament, as the fitting of Ikara would require removal of one of the three 4.5 inch turrets currently fitted in each ship. In view of the changed strategic requirements and operational experience since this plan was formulated some three years ago - as honourable members know strategic requirements do change and a government must have elasticity in its forward programme - and the fact that all of the other fleet escorts will have Ikara fitted, it has been decided that in the present circumstances a better balance of weapon systems in the fleet will be achieved by improving the capability of the Darings as gunships. Accordingly, Ikara will not now be installed in HMAS ‘Vampire’ and HMAS ‘Vendetta’, but their three 4.5 inch turrets and associated fire control systems . will be retained and considerably improved. The change in plan for the Darings will result in a saving of over $20m in the total cost of the project, and approximately a year in the operational availability of the two ships. This work will be done at the Navy’s dockyard at Williamstown, Victoria.

I now refer to HMAS ‘Melbourne’, the aircraft carrier of the Royal Australian Navy which will go into naval dockyard at Garden Island. Sydney, in January 1968 for an extended refit. As stated by my predecessor, in October 1965, when this project was approved in the naval programme, earlier plans to give HMAS ‘Melbourne’ an extensive half-life modernisation, taking about two years and costing some S20m, were changed to the present plan for an extended refit, which is now expected’ to cost about $7m. This limits work to essential up-dating of facilities and equipment, including alterations necessary to operate the carrier’s new aircraft. Prior to the refit, ‘Melbourne’ will collect her new aircraft from the United States later this year, as has already been announced. Whilst she is refitting in 1968, aircrews and maintenance personnel will undergo the necessary conversion and operational training on the new types of aircraft. Some pilots, observers and maintenance personnel have already been trained in the United States on the new aircraft and will act as instructors during conversion training. The aircraft will be used for operational exercises with fleet units, and this will assist aircrews to become proficient in the use of the new and sophisticated aircraft equipments. The Wessex anti-submarine helicopters will be operated from the fast transport HMAS ‘Sydney’ as appropriate.

I thought it may be of interest to honourable members to have some idea of the magnitude and- complexity of the work involved in the refit of an aircraft carrier. It is more complicated and extensive than ever before attempted in Australia in modernising an existing naval ship. To install additional electric generators, air conditioning and fresh water distilling equipment seven decks below the flight deck, a large hole through the inner and outer bottom must be cut in dock. The existing equipment must be removed before the larger units can be installed. All the aircraft fuel stowages are being rearranged and half will carry petrol instead of the less flammable turbine fuel, and more safety arrangements are needed. All the magazines for the new aircraft armaments will have to be altered. These are examples of jobs which will need nearly two million man hours of work. Up to 1,500 men from 30 trades will work on board. To control this force the work is being divided into some 6,000 interdependent activities which will be programmed by computer using the network technique.

I mention the fitting of the Ikara antisubmarine system in fleet escorts. The installation of the Australian designed and produced Ikara anti-missile system in fleet escorts has proceeded satisfactorily. It is now operational at sea in the four type 12s in commission - the HMAS ‘Stuart’, the HMAS ‘Parramatta’, the HMAS ‘Yarra’ and the HMAS ‘Derwent’ - and the guided missile destroyer HMAS ‘Perth’. It will be fitted in the HMAS ‘Hobart’ and the third destroyer still being completed in the United States, the ‘Brisbane’, at suitable opportunities during refits. The two new type 12 escorts building at Williamstown and Cockatoo Island, the HMAS ‘Swan’ and the HMAS ‘Torrens’, will have their Ikara systems installed during construction. Ikara has been successfully tested against submarine targets as well as instrumented static targets. The introduction of this system has greatly increased the antisubmarine capability of the Australian fleet. The Tartar medium range surface to air missile system, as fitted in the HMAS Perth’ and the HMAS ‘Hobart’, was the subject of some criticism in this House by the Opposition before the ships were delivered to the Royal Australian Navy. These doubts were not shared by naval authorities in view of the proven performance of the system in the United States Navy service. Our confidence in the Tartar system has been vindicated by the successful firings from our own destroyers. I might add that since the surface to air practice missile range at Jervis Bay came into operation earlier this year, both the HMAS ‘Hobart’ and the HMAS ‘Perth* have fired Tartar missiles at Jindivik pilotless target aircraft and excellent results have been recorded. It was reported to me only yesterday that HMAS ‘Perth’ conducted two further successful Tartar firings at the end of last week.

Honourable members will be aware from reports published from time to time of the magnificent service which the HMAS Hobart’ has been rendering since March of this year in the Vietnam area, as a unit of the United States Seventh Fleet. I am happy to be able to amplify this by mentioning that the continual pattern of the reports I have received indicates clearly that the Hobart’s efficiency and performance have won high praise from senior United States Navy officers. This ship and her company are undoubtedly a great credit to the Royal Australian Navy and to the nation. A less spectacular but highly significant contribution to the allied effort in South Vietnam has been provided by a Royal Australian Navy clearance diving team which has been operating in the area since February of this year. This team, working in conjunction with the United States explosives ordnance disposal teams, has been engaged on the task of protecting ships in harbour. As announced recently, 8 Royal Australian Navy helicopter pilots and some 3 dozen supporting personnel will go to South Vietnam later in the year. They will join a United States helicopter unit which is stationed in the area of the Australian Task Force to provide helicopter support to the allied forces, including the Australian Task Force operating in the Phuoc Tuy province.

I come to the question of general expansion. There has been a very rapid development of the Royal Australian Navy over recent years. This has been accompanied by the introduction into service of the most sophisticated and diverse equipments in the Navy’s history. I have already referred to the Ikara and Tartar systems, but in addition to these there is a wide range of new items, such as the Seacat short range surface to air missile system; new types of medium range sonar equipment; modern and complex communications; the most up to date shipborne radar; and highly efficient hard hitting guns and fire control systems. The 5-inch guns on HMAS ‘Hobart’ have fully demonstrated their worth while the ship has engaged in shore bombardment off the Vietnamese coast.

No less than thirty fleet units have commenced construction in the last few years and are being commissioned into the fleet as they complete. These include three guided missile destroyers, the third of which, the ‘Brisbane’, will be ready late this year or early next year; four submarines, the first of which arrived in Sydney Harbour last week; a destroyer tender which will be completed at Cockatoo Island dockyard later this year; two new type 12 escorts being built in Australia; and twenty patrol boats under construction in Queensland shipyards. The personnel of the permanent naval forces has been increasing to match this expansion of the fleet, and the maintenance and training effort that is required in consequence.

I thank the House for its indulgence in allowing me to present these facts about the Royal Australian Navy as a counter to what has been said in part in criticism by the Leader of the Opposition and by other honourable members concerning the preparedness of our Defence Forces, in particular the Navy. As far as I am concerned, I am sure that the few facts that I have given the House will illustrate that the Royal Australian Navy has never grown faster and has never been more efficient. I commend the Budget to the House.

Mr WEBB (Stirling) [12.17J- The Minis.ter for the Navy (Mr Chipp) during the course of his remarks referred to the fact that honourable members on this side of the House were reluctant to discuss the question of foreign affairs. I suggest to him that honourable members on his side of the House seem to be very reluctant to discuss the Budget, which is the matter that is before this Parliament at the present time. I remind the House that the question of foreign affairs was discussed for some time on Thursday of last week and on part of Tuesday of this week. It was discussed extensively by this Parliament. The Government stopped the debate on foreign affairs. Now it wants to carry that debate over into the Budget debate.

The Minister for the Navy criticised the Leader of the Opposition (Mr Whitlam) for not dealing with Vietnam when discussing the Budget. I remind the Minister that the Leader of the Opposition got an extension of time and discussed the question of foreign affairs for more than one hour last Thursday night. It is humbug on the Minister’s part to talk like this. He was reluctant to discuss the Budget. That applies to all honourable members opposite. They want to direct the thoughts of the people away from the Budget by continuing with the debate on foreign affairs, and when one looks at the Budget one can well understand why they want to do that.

My purpose in speaking in this debate is to support the amendment which was moved by the Leader of the Opposition and which, incidentally, was not mentioned by the Minister for the Navy during the course of his speech. He dodged the issue, too. I shall take the last part of the amendment first, which states: . . ‘This House condemns the Budget because -

  1. it allows social service and war pensioners to fall still further behind their fellow citizens’.

This fact has been ably proved in this House by the Leader of the Opposition and by those who have followed him. The Government has shown a callous disregard for those in the community with the greatest needs and the smallest means. It has turned a deaf ear to the plight of the pensioner.

Despite the admitted price rise at a rate of 5% per annum over the last quarter of the past twelve months, not lc increase in pension has been given to the aged, the invalid or the widowed pensioners. The Treasurer (Mr McMahon) admitted that there had been a price rise in the last quarter at an annual rate of 5%. What sort of a Government is it that could ignore the miserable circumstances of the many thousands of these people during a period of rising prices?

It has been said that a country’s standard of civilisation can be assessed from the way it treats its old people. If that is so our standard of civilisation has dropped badly under this Government. Advances in medical science and knowledge have led to a rise in the standards of health with the result that people are now living longer. We should be concerned about the way in which they are living. If thousands of our aged people, invalids and widows are living in poverty and in dire straits it is a reflection upon our society. Who can deny, that a pensioner with nothing but his pension, or a little more than his pension, to exist on is living in poverty? Many of these people are being treated shabbily by this Government. Science may be helping them to live longer but the policy of this Government seems to be directed towards making their additional years years of misery.

The Government claims that we are a prosperous country. No doubt we are more prosperous than many countries, but surely the poorer sections of the community are entitled to enjoy at least some of that prosperity. Are the aged, the invalids or the widowed enjoying that so called prosperity? Indeed they are not, and statistics will prove that. In reply to a question yesterday the Minister for Social Services (Mr Sinclair) said:

  1. . if we make a comparison between the present base rate pension and the average weekly earnings, we see that the base rate pension stands at a higher point now than it did at any time during the previous eighteen years. . . .

I want to challenge that statement because the figures show that it is not true. The pensioner in fact is getting a lesser percentage of the average male wage now than he did in 1949. In 1949, for instance, both married and single pensioners received a pension representing 24.8% of the average male earnings. By 1963 that percentage had dropped to 21.1%. It was during that year that the differential rate between the single and the married pensioners was introduced. This year the percentage has dropped even further. The average male earnings for the past twelve months was around $60. The single pensioner now receives 21.7% of the average male earnings and the married pensioner receives 19.6% of the average male earnings. That is a big drop in percentages as compared to the position in 1949. The Minister for Social Services claimed yesterday1’ that the figure was higher now than it was then. Does that not prove conclusively that our age, invalid and widow pensioners are being treated shabbily by this Government.

Every recipient of social services has been short-changed since this Government has been in office because increases in social services have not kept pace with price increases. Social services are continually dragging behind costs. As a result of inflation over the years taxpayers have passed into higher income tax groups, and although the taxpayer gets less in real wages in his pay packet the Government takes more off him and gives him less in return. For some years now the people have been victims of a thimble and pea trick. They have been giving good money for bad; they have been contributing taxes to the National Welfare Fund and getting shrunken benefits in return, because of inflation. The value of the dollar has shrunk to about 30c as compared to 1949. The people are losing both ways; the value of social service benefits has been clipped just as if extra taxes had been imposed, and the people have moved into higher income tax ranges without getting any more purchasing power in their pay packets.

The increased allowances for dependants - the so-called tax concessions - mean very little. The man on the lowest wage will save 20c a week and so will pay $1.20 a week taxation instead of $1.40 a week. In other words, he will now pay $62.40 a year. Compare this figure with the position in 1949 for a man on the lowest wage, with two children. That family paid only $1.60 a year - not a week - compared with $62.40 a year for the same family now, assessed on what is known as the lowest economic wage, $33.80. Dependants’ allowances are being increased in the Budget from $286 to $312 for a wife, from $182 to $208 for one child under the age of 16 years and from S130 to $156 for further children under the age of 16 years. This increase is chicken feed and leaves these allowances for dependants far below the value of similar allowances a few years ago. My authority for that statement is the ‘Taxpayers’ Bulletin’ of 2nd August 1966, in which the Secretary of that Association said:

The rate of tax we all pay increases as inflation (emphasised by recent wage and marginal decisions) takes wages and salaries into higher income brackets.

Because income tax becomes disproportionately higher, it is necessary for the level of concessional deductions to be reviewed constantly and increased to levels consistent with present-day conditions.

In the past twelve years the male basic wage has risen by more than 33%, and the tax payable by a man on the basic wage, with a wife and two children, has increased by 285%. In that period, the deduction for a spouse has increased by only 10%.

The subject has been considered at length by taxpayers associations in Australia and we consider that:

The deduction for a spouse should be increased to between $500 and $700.

The deduction for children under 16 should be increased to between $300 and $400.

The deductions for other classes of dependants should be increased appropriately.

But the Government has increased these allowances by very miserly amounts that do not bring them back to their value in former years. Clearly the Government has failed in the Budget to give adequate increases in dependants* allowances. The only tax concession of any substance is the lifting of the insurance deduction from $800 to $1,200 a year. Who will this deduction help? The rich, of course, and the insurance companies. How many family men could afford even $800 a year insurance let alone $1,200. The Government is guilty of greasing the fatted pig. Too few are making too much at the expense of too many under this Government.

The ‘Sun-Herald’ financial review of 20th August 1967 said that the Budget was good news for insurance companies, and I quote:

The big Budget gains in last week’s market came from the life offices after the increase in allowable tax deductions for life assurance and superannuation from $800 to $1,200 a year.

And of course shares in insurance companies will increase in value. As the Leader of the Opposition said, because of the progressive system of taxation, insurance becomes cheaper to buy as the income of the purchaser rises. Even when the maximum deduction was $800 only a family man with an annual income of about $6,000 or more could take full advantage of this concession. Those people represented about 4% of the taxpayers. For a family man to take advantage of the full $1,200 deduction he would need an income of about $10,000 or more a year, and such taxpayers represent less than 2% of the total taxpayers. Yet this is called a family man’s Budget. To make any real gains the family has to be a large family with a very large income.

What does the increase in child endowment mean to the average family? In the Budget Speech the Treasurer said, for example, that a family of nine children will receive an additional $5.25 weekly under this proposal. The average Australian family has les.s than three children and 75% of Australian families have less than four children, so this measure helps about 25% of Australian families. But what about the 75% of families it does not help? Let us consider a family with three children, which is getting close to the average family. In 1949 the child endowment paid to a family of three children represented 11.5% of the average male earnings, to use the Minister’s comparison again. During the past twelve months average male earners have been about $60 a week. The family with three children gets $3 child endowment, which represents 5% of the average male earnings. So, in purchasing power, it is less than 50% of what it was in 1949. A comparison with the lowest wage also shows how the value of child endowment has decreased over the years. When 1 mention the lowest wage I do not refer to the new minimum wage of $37.55, prescribed in the metal trades award which the Treasurer would have the House believe now applies to all workers as a minimum wage, but to the last basic wage, declared in March 1967, of $32.80 plus the $1 increase, making a total of $33.80, which would apply to a labourer who was formerly on the basic wage. ‘

In 1948, with a minimum wage of $11.60, a family of five children received $4 a week in child endowment. With the new economic wage that I have just quoted, a family with five children now will receive $6.75 under the amending legislation. The wage has increased by nearly three times, so to retain the same purchasing power as a similar sized family had in 1948, child endowment for a family of five children should now be about $12 a week instead of $6.75. The Opposition, of course, welcomes any legislation that will help the family, and this increased child endowment docs help 25% of families. The other 75% get no benefit at all. lt is interesting to analyse how a family income is reduced as extra children come along. The average wage is about $60 a week, as I mentioned. A married man without children pays $7.80 a week in taxation on that income. This reduces the family income to $52.20, or $26.10 for each unit. When the first child arrives the taxation is reduced to $6.80 a week and the family receives 50c for child endowment, which gives the family an income of $53.70 or $17.90 for each unit. When the second child arrives the taxation is reduced to $6.10 and the child endowment increases to $1.50. The family income is thus $55.40 or $13.85 for each unit. With the third child taxation is reduced to $5.40 a week and the child endowment is increased to $3 a week, leaving the family with an income of $57.60 or $11.52 for each unit. When the fourth child arrives the taxation is reduced to $4.70 and the child endowment is increased to $4.75, giving a total family income of $60.5, or about $10.16 for each unit of the family. If we take child endowment and taxation into account it is interesting to note that the family with four children shows a profit of 5c a week if the man is on the average wage. The examples I have given deal with the big majority of families, because 75% of all families have less than four children. Only 25% have four children or more. This illustrates, too, that more than is given in child endowment is taken back in income tax. The only family that shows a profit is the family with four children, and its profit is only 5c a week. If we take into account increased postal charges and increased sales tax, all child endowment and increased dependants tax allowance is grabbed by the greedy hands of the Treasurer. This is a rich man’s budget. The only family that will get any real benefit is the wealthy large family that can also take full advantage of the increase from $800 to $1,200 in the allowable deduction for insurance.

The ‘Australian’ economist, Kenneth Davidson, in an article on 18 August posed the question: Who is paying for the war in Vietnam? His article was headed ‘The Family Man Pays for the Rise in Defence’. To the family man could be added the pensioner who, despite an increase at the rate of 5% per annum in the cost of living in the last quarter, is expected to exist on the same pension. Kenneth Davidson shows that despite the increased proportion of the gross national product that is being devoted to defence, the cash benefits paid to persons have dropped from 5.5% of the gross national product to 5.3%, and the grants to the States have dropped from 8.3% of the gross national product to 7.9%. He points out also that taxation has not been increased, so that the increased resources being devoted to defence have been achieved by squeezing the other two areas of expenditure to which I have referred. When Commonwealth resources are inadequate the States have to increase their revenues to meet the deficit. In the ‘West Australian’ of 4 July 1967 it was reported that Premier Nicklin maintained that the Commonwealth Treasurer at the Premiers* Conference had suggested to the States that they impose a special purchase tax. A turnover tax has already been levied in Western Australia - a tax on the turnover of cash. All States have been subjected to a financial squeeze and have been forced to increase charges. Last year all States had to increase hospital and transport charges. This year they will be forced to do so again. The Treasurer has already suggested this course to them.

The ‘Australian’ economist has pointed out that since 1963-64, when defence expenditure started to move ahead, payasyouearn taxation has increased by almost 88% and that in the same period total Commonwealth taxation receipts have increased by only 50%. He said.

This indicates that the wage earner has assumed a greater proportion of the tax burden over this period.

He also pointed out that the rate of increase in taxation had been far larger in the lower and middle income groups as a result of the failure to reform the pay-as-you-earn taxation rate at various levels of money income. Between 1963-64 and now, average weekly earnings rose by about 20%, but income tax payable rose by just over 30%, after allowing for deductions for a wife and three children. This economist pointed out that for a man on $10,000 a year in 1963-64 with similar deductions and a 20% increase in earnings the rise in the proportion of tax payable was only just under 20%. At $20,000 a year, under the same conditions, the proportionate tax burden would have increased by only 15%. Over the same three-year period the minimum wage rose by only 11%, but the wage earner on this income would have had a 17% increase in his tux burden as a proportion of income. After making these points the economist said:

For this reason it is extremely disappointing that the Treasurer has seen fit in the tax concessions offered to construct them so that the rich can take far greater advantage of them than the middle and lower income groups.

Only the very wealthy will be able to take full advantage of the $400 increase in the maximum allowable deduction for superannuation and insurance.

There we have direct evidence from an unbiased source that the Government is placing the burden of financing the war on the poorer sections of the community. Those with the greatest needs and with the smallest means are paying for the war while the wealthy few are getting defence on the cheap. I turn now to the third point made by the Leader of the Opposition, namely:

This House condemns the Budget because it defers and retrenches development projects.

Who could honestly deny that this statement is true? The Government has failed miserably in the Budget in the field of national development, lt does not give a glimmer of hope in this field for the advancement of Australia. Instead of keeping the Snowy Mountains Hydro-Electric Authority together for works of development it is allowing it to fall apart. The whole of the Authority should be retained as a constructing body. Instead, this great team, with its fine reputation in the engineering and design field, is being allowed to languish. The Government lacks imagination. It is worn out. It is prepared to let things jog along without any planning for Australia’s advancement. The Minister for National Development (Mr Fairbairn) has announced that the Snowy Mountains Authority will not continue with construction projects after 1974, but that some of the staff will be ..retained. As a result, the resignation rate of the Authority has jumped from 5% to 21% in the past two years. If the Government’s policy is allowed to continue, the staff could be halved in a very short time.

In the field of national development, the Government once again has shirked its responsibility and failed to face the problems of the north. For all this Government cares about the north, one would think it is some foreign country far away from Australia’s shores and not worthy of a second thought. Where does the Government stand on the Ord River project? Prior to the 1963 election, the Government said the project was very important, but the Government then had a majority of only one in this House. The Prime Minister at the time, Sir Robert Menzies, when opening the diversion dam, said the Ord was needed desperately for the future of the country. Once the election was over, the Ord River project was pushed to one side and forgotten. The Government said it required further information. When it had all the information about crop analysis, it still prevaricated and continues to do so.

Cotton has proved itself, but pressure groups from the cotton growers in northern New South Wales have proved to be too influential. They want the cotton bounty of $4m confined to the existing cotton growers. They fear that their share of the bounty will be reduced if the main Ord dam is proceeded with. The cotton farmers on the Ord again have had a record crop. The Ord is one of the many rivers in the north where the water is being allowed to run uselessly into the sea. This is a national calamity. The Ord scheme could be repeated on the Fitzroy and other rivers. The construction of the main Ord dam would allow another 1 60,000 acres to be irrigated. It is estimated that one-third of the world population goes to bed hungry every night and that another one-third is under-nourished. The present population of the world of 3,000 million is expected to double in the next fifteen years. Surely we owe it to the world’s starving millions to use our great resources to help solve this terrible problem. How can we in all conscience keep this huge area if we do not put it to good use? We must have the courage to venture out and to develop the north. If everything had been examined in the light of economy, no progress would have been made by the early pioneers of this country. We must have a national spirit and a national conscience and help to feed the people of other countries who are enduring semi-starvation.

The fertile black soil of the Ord will grow almost anything. The research station has proved that this is so. Latest reports show that sorghum can be grown on a huge scale on the Ord irrigation area. This has been mentioned by the Minister for National Development. Some backbench members on the Government side have referred to the great export growth seen for the north. But the Government takes no notice. The possibilities of the north are tremendous. The irrigation project could boost the beef cattle industry. The possibility of feeding cattle on sorghum is being investigated and no doubt will prove successful, as it has in other areas. California, for instance, treats 480,000 tons of cotton seed a year and from its by-products thousands of cattle are topped off. We could do the same as this in the north, if we only appreciated the possibilities of the area. The possibilities stand out, but the Government cannot see them and will not act.

What is required is a ministry for northern development. The north’s great natural resources require co-ordinated planning and development. The Loder Committee gave the Government a blueprint to do much more for the north. All that it has done, of course, is to build a few beef roads. But even the beef roads project is being retarded. There is very little coordination and huge areas held by absentee landlords are making the project costly in the light of what is being achieved. A substantial amount of public money is being expended on the beef road programme and this is mainly benefiting the absentee holders of vast leases. Under this Government we have witnessed a yielding to the selfish interests of overseas and Australian absentee landholders. They were able to exert enough pressure to have the Crown Lands Ordinance of 1954 extended for another fifty years to the year 2004. The Ordinance failed to impose adequate con ditions to ensure the improvement of holdings and the protection of native pastures and vegetation. In the same way, the Government is selling out our rich mineral resources to overseas and Australian monopolies. Japan could not take Australia by force of arms during the war, but she is now buying it for a few cents a ton.

The recommendations of the Loder Committee have been largely ignored. We all remember the shocking delay in presenting the Committee’s report to the Parliament. The Committee was appointed in 1964 but the report was not presented until May 1967. It recommended reduced income tax, lower sales tax on household electrical goods and on vehicles, cheaper air fares and other tax concessions for the north. But nothing has been done to implement the recommendations. They were designed to attract people to the north and to make their conditions a bit more endurable when compared with the conditions of people in the south. But rather than attract people to the area, the Government seems hell bent on discouraging efforts to populate the north. At present the population of the area is three and a half people to every 100 square miles of the 577,000 square miles above the 26th parallel. Surely we owe it to this country to do something about this vast area and to meet the needs of people in other countries who require food.

I repeat what I said at the beginning. The Government would like to turn this debate away from the Budget and into a debate on foreign affairs, because it wants to take the thoughts of the people away from the Budget. We intend to keep the thoughts of the people on the Budget and to let them know what a mess the Government is making of this country and how the people will suffer as a consequence.


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

Sitting suspended from 12.47 to 2.15 p.m.


– In the years that I have been in this Parliament I have often thought, and more intensely recently, that if a man came out of space, landed in Australia and came straight into this Parliament, if he could understand our language and heard members of the Opposition speaking he would wonder how it is that the Government has such large numbers and the Opposition such small numbers if the Government is as bad as the Opposition claims. But if we look at the records we find that at all elections since 10th December 1949 the Government has been returned with varying majorities until now it has a record majority in this House. After every election, when Arthur Calwell was Leader of the Opposition and now also, they have said that at the next election the Labor Party would sweep the Government from the Treasury bench. We all know that hope springs eternal in the human breast, but we find nothing to substantiate any of these claims made by the Opposition. Would not a man who came here, who could understand our language and realised that we are a democracy, wonder why there should be these repeated assertions by the Labor Party? Would he not wonder even more if he had been here last night and listened to the honourable member for Wills (Mr Bryant)? In the course of his remarks he said:

Most of the policy of honourable members opposite is based on humbug and hypocrisy.

Is it not a fact that we are all elected by the people of Australia and is it not true that an honourable member who says that is disparaging not only other honourable members but also the Australian people who have elected all of us? It is a very bad tiring when honourable members have to speak against personalities instead of criticising policy. I do not often make extravagant statements, nor am I doing so when I say I believe that the speech made last night by the honourable member for Wills was one of the worst in this regard that I have heard during my twenty-one and a half years in this Parliament. As an Australian I consider that the words he used should never have been uttered.

In discussing the Budget papers I want to say one or two things about the Australian Labor Party. I want briefly to touch on Vietnam, health and the redistribution of electoral boundaries in addition to mentioning one or two other subjects. But time passes quickly and so I must move on. The Labor Party recently held a conference in Adelaide. There has been much boasting to the effect that anybody could attend the conference and that it was televised. I saw the telecast. I have been told and I saw for myself that the meeting lasted for one and a half minutes. The fact is that there was no agreement within the Labor Party - none whatever - so delegates to the conference went into a back room to discuss matters. After a long time they reached agreement and came back into the conference room among the State delegates where the television cameras were clicking. After all this time in private discussion they came in and announced the agreement to the Party. It was all over within one and a half minutes. Yet this is the kind of thing that the Leader of the Opposition (Mr Whitlam) is boasting about. He has said that the Leader and Deputy Leader of the Federal Parliamentary Labor Party and the Parliamentary leaders of the Party in the States are able to attend the Federal conferences and to address the meeting. He claims that in no other party in Australia is there that right. I suggest that he should look at the Country Party.

In the Country Party I represent Victoria. The Leader of the Country Party, who is Deputy Prime Minister and Minister for Trade and Industry (Mr McEwen), and the Deputy Leader, the Minister for the Interior (Mr Anthony), as well as delegates from the States are entitled to attend. The Country Party has had for years the privileges that Labor now boasts about and claims that no other party has. Once we find misrepresentation in a certain quarter we begin to cast doubts on any statement made in that quarter, whether the statement comes from the Leader or from someone else. I realise that the Leader of the Opposition is in a quandary. We have only to refer to today’s edition of the ‘Canberra Times’ to see that this is so. I know that it can be said that the report may not be true, but the Press report states that at a meeting of the Labor Party in Canberra yesterday the Leader of the Opposition warned ALP men not to talk. We know that in the past there have been leaks of what has occurred at Labor Party meetings and matter which has appeared in the Press has been substantially true. I believe that the report is correct on this occasion. We have only to think about this matter to reach this conclusion. But whether or not it happened at the meeting yesterday does not matter.

Would not the Leader of the Opposition be very pleased if members of the Labor Party did not speak on policy? He warned them not to discuss policy. He referred to certain members whose names I shall not mention because I do not indulge in personalities. The report states:

Mr Whitlam is understood to have said that reports of some of the speeches, especially those interpreting Party policy, had embarrassed him.

Every honourable member who has sat in this chamber and heard questions asked and answered and debate going on’ about certain things that have been said by Labor members whom we know so well has had only to look at the Leader of the Opposition to see that he was embarrassed. One could see that he was hanging his head and hoping that he could get these men to keep quiet. His view is: If 1 announced the policy, it would be all right. The Press report states -I am not concerned whether it is accurate or not - that a certain member had announced that it did not matter what the Leader or the Deputy Leader of the Labor Party said as it was the conference which decided policy. I am not concerned whether it was the honourable member for Yarra (Dr J. F. Cairns) or the honourable member for Wills who said this. That is quite beside the point. Nor can I understand the Prime Minister (Mr Harold Holt) and the Leader of the Opposition fighting about whether or not it was said.

I notice that the honourable member for Yarra tried to evade what has been said because it might have appeared that he was trying to disparage his Leader. But what does it matter? The point is whether it is true. It does not matter who made the statement. Does it matter whether it was said about the Leader of the Opposition or the Deputy Leader (Mr Barnard)? ls that the policy of the Labor Party decided at the conference in Adelaide, after negotiations in the back room and an open meeting which lasted for one and one-half minutes? Of course it is the policy. I can see quite clearly that the Leader of the Opposition is in a dilemma in trying to quieten his left wing and in trying to put before the people of Australia something that they will accept. To do this he says that the Labor Party’s policy on Vietnam is quite clear; if the Americans do not do this, that and the other and con duct only a holding war the Labor Party will withdraw troops. So the ultimatum to America would be: Cease certain action or we will withdraw Australian troops.

A member of the Labor Party is reported to have said that there should be a holding of the Vietnamese north from the south - nothing more. This intrigues me. Someone has referred to a thin red Une. Surely this could be a thin red line because behind the holding point along the border could be all the arms in that part of the world. There could be an annihilation in the manner of the thin red line of the troops waiting there. From our knowledge of modern warfare we know that we must hit at supplies coming in and not wait until they are right along-side. That was all right during the First World War when materials were brought into the trenches, but now we must hit at supplies further back. It seems to me that the Leader of the Opposition is trying to put sound views to the people and at the same time satisfy his Left Wing. This is impossible.

Reference has been made to the nationalisation of industry, production, distribution and exchange. The Leader of the Opposition has said that we cannot nationalise industry because the High Court will not let us do so. It is a very sorry state of affairs for the people if they elect a government and then have to depend on the High Court to save them from that government Surely you should be able to depend on the people whom you elect. The honourable gentleman said: ‘We cannot do this; the High Court will not let us.’ But of course he would do it if he could. We know what a former Labor Prime Minister endeavoured to do about banking. The honourable gentleman said that a government’s inability to do these things did not matter so very much now because it could always establish businesses to compete with private enterprise. Mr Calwell, said that you cannot unpluck the fowl. Once a government established a business with taxpayers’ money and builds it up, what chance would private enterprise have? It would not matter if the government business lost money; it would be only taxpayers’ money. The Leader of the Opposition has managed to silence his left wing by saying that a Labor government could nationalise industry, production, distribution and exchange in this way.

Mr Beaton:

– Is the honourable member opposed to Trans-Australia Airlines?


– -1 am opposed to unfair nationalisation. It has been claimed by honourable members opposite that the Budget is the worst that has ever been brought down by this Government. Over the years I have noticed how fond members of the Opposition are of quoting from newspapers. Most of their speeches consist of quotations from newspapers, particularly when those newspapers describe a budget as a bad budget. But in this debate only two members of the Opposition have quoted from newspapers. Why do Labor supporters not quote from the newspapers in this debate? It is because the Press has accepted this Budget as being very satisfactory for the economy. For my part there is only one thing in the Budget which, had it been rectified, would have made this a well nigh perfect budget. 1 refer to pensions.

Mr Peters:

– A bit each way.


– Not at all. I would have been very pleased to see pensioners get a reasonable rise but if at a later stage - when the Estimates are being debated or when appropriate legislation is before us - the Labor Party moves to have pensions increased, I will not support it. I will not support such a move because, notwithstanding what I think about the plight of pensioners and the necessity to help them, I believe that to keep in office this coalition Government is much more important to the Commonwealth of Australia. [ make that point as clear as I can.

I turn now to Vietnam. Honourable members who have visited Vietnam and seen perhaps a town here and a town there represent themselves as experts on the country. This never ceases to amaze me. If a man comes to Australia what does he know about Australia if he sees only Melbourne, Sydney, Perth and one or two other places? So I decided to seek some real evidence about Vietnam. Where would you go for that evidence? ‘ Would you go to a Press agent? Would you go to an Opposition supporter or a Government supporter who had been in Vietnam for three or four days? Of course not. Some people may seek advice from such quarters but the evidence they would get about Vietnam would not be very satisfactory. I would go for my evidence to men who had served in the country and who had seen at first hand what is happening there. With this in mind I wish to quote from a newspaper which is published in the town in which I live. It is the ‘Boort and Quambatook Standard-Times’. We are proud of this newspaper because you can depend on everything that is printed in it. It does not contain propaganda. It presents the facts. The editor has a reputation for this kind of journalism. The article concerns a young man from Kerang, which is a town about thirty miles from Boort. This young man has just returned from Vietnam. He was recently guest speaker at a meeting of the Boort Apex Club. The article to which I refer states:

The countryside, the war and the people of Vietnam were the topics of discussion at Tuesday night’s meeting of the Boort Apex Club when Geoff Peacock, of Kerang, recently returned from service in Vietnam, was the guest speaker.

Geoff was only half way through his talk when the allotted time for a guest speaker expired, but because of the importance and interest of the subject he was asked to continue.

When asked if he thought the war was justified he replied that once you had been over there and seen what was going on the war was definitely justified and the only way the peoples of Vietnam could ever be free again.

Asked if any of the conscripts had resented going over there he said some would have at first, but he was equally sure that most would change their minds once they had been there.

He also slated that they took a very ‘dim view’ of the anti-Vietnam demonstrations in Australia and said that those demonstrating should see what it was like for themselves before commenting.

He said that the general feeling among those who served in Vietnam was that the Australians and Americans should stay there and try and bring peace.

The demonstrations against our involvement in Vietnam and the sending of money to help the Vietcong are almost unbelievable. I had some experience in the last war. There is a world of difference between what you think and what you know. In the dark days in Changi Gaol when men were dying there was a secret wireless. On one occasion it was found and the man who had been operating it was never seen again. But another wireless was made. It was made from a tube and other bits and pieces. There were some experts in the camp. Word came through that wharf labourers in Sydney had been granted danger money while working on the wharves in Australia. You should have heard what the boys said about that. How they condemned it. What must the boys fighting in Vietnam think about Australians who endeavour to give succour to the people who are fighting against them and who would kill them if they could? To want to send money to the Vietcong indicates wrong thinking in this country. Surely we still have the Australian spirit. Surely we can do things better than this.

The honourable member for Wills (Mr Bryant) said that China poses no threat to us. He said that we want to be a force of our own, ready to fight any enemy. I remind the honourable member that during the last war when it appeared that Australia would be invaded by the Japanese, Mr Curtin, the Labor Prime Minister, called on America for aid. But had it not been for the Eighth Division holding up the Japanese on the Malayan Peninsula there would not have been any Coral Sea battle. Let honourable members opposite laugh if they will. John Curtin called upon the American nation, and the American nation responded. But the honourable member for Wills said that we do not now want the American nation; we want our own force. In my opinion this is completely wrong. Notwithstanding that this Government has done a great job in building up our Air Force, Army and Navy to be able to meet any enemy, we cannot afford to do without the American nation. Some people ask why we should co-operate with the Americans. Well, they speak our language. They stand for democracy. No human being can stand beneath their flag without becoming and remaining free. The same thing applies to us. So we stand with the Americans.

These things cannot be said about many countries. All over the world there is appreciation of British justice. Wherever people go they have a sense of security if they know they can expect British justice - a kind of justice which has been won for us down through the ages by the self sacrifice of our forebears; those who were responsible for our democratic government. Other forms of government have been tried all over the world but they have never proved of any good unless they have encompassed those principles that have upheld and sustained manhood and womanhood down through the ages. 1 now want to say briefly one or two things about health. 1 have to be brief because time gets away from one so quickly. A national fitness campaign is at present being conducted.

Mr Cleaver:

– lt is a good idea.


– It is a very good idea. lt has the support of the Australian Mutual Provident Society and it has been commended by the Prime Minister. This is good. However, I am wondering whether somebody who takes part in a proposed run in the morning for publicity purposes will, at the end of it, pull out a packet of cigarettes and say: ‘We have had our run for fitness. Let us now light a cigarette.’ It is not of. much use having a fitness campaign if we ignore all the warnings and fail to realise that lung cancer is a reality. One of my constituents is very keen on our being aware of the dangers of smoking. He has told me a few things about cigarette advertising. He states that on television a cigarette advertisement is shown every twelve minutes. This is in direct contrast to the present national fitness campaign. It is of no use to conduct a fitness campaign aimed at promoting health and have it negatived straightaway by cigarette advertising. Only recently, medical experts in the United States of America have again pointed out to us the dangers of smoking. We ought not to have a national fitness campaign and cigarette advertising side by side. One negatives the other.

I now move on to deal quickly with the subject of the redistribution of electoral boundaries. What I have to say on this issue will please no party but the Australian Country Party. A question about this subject was asked recently. The Minister -for the Interior, replying, said that a redistribution would take place before the next general election. My colleague, the honourable member for Kennedy (Mr Katter), has just passed me a note very kindly asking whether I would like an extension of time. I appreciate his courtesy. Let me say to him that I greatly appreciated the speech that he made earlier in this debate. It came as a breath of fresh air, because it is most refreshing to hear someone make a speech in this chamber without reading it. After a census is conducted to determine the population, the Commonwealth Electoral Officer determines the quota of electors for electorates. I am told that it is now 50,006. The Commonwealth Electoral Act provides that this quota may be varied up or down by 20% for any electorate. We believe that this provision in the Act should be put into effect. This would provide the only sure means of decentralisation.

A member of the Australian Labor Party has on the notice paper a motion dealing with decentralisation. It makes no reference to this provision for variation of the electoral quota by 20%. If it were put into effect in the way I propose, more representation would be given to country people. However, the honourable member concerned has nothing to say about that, and let him not say that his proposed motion refers to it. He has fallen down on his task in this respect. I admit that the terms of the motion that he has placed on the notice paper include the words ‘any related matters’. Perhaps he will claim that the use of the provision in the Commonwealth Electoral Act for the variation of the electoral quota comes under the blanket of those words, though he does not mention it specifically. We who belong to the Country Party say that city electorates should have as nearly as possible a quota of 60,000 - 20% more than the nominal quota - and Country Party electorates a quota of 40,000.

Mr Bridges-Maxwell:

– Country Party electorates or country electorates?


– The Country Party maintains that the quota for city electorates should be 60,000 and for country electorates 40,000. When we come to think of it, this Parliament is composed of two Houses. In the Senate, there are as many senators from Tasmania as there are from New South Wales. Is that in accord with the princple of one vote one value? Of course it is not. Do members of the Labor Party believe in decentralisation or do they want to keep all the people in areas such as Coburg and Melbourne Ports?

Mr Cope:

– And Kingsford-Smith.


– And Kingsford-Smith. Is that what they want to do? That is the question. Of course they want to do that.

We believe that the only effective way to prevent decentralisation from being merely a catchcry in politics is to implement the provision in the Commonwealth Electoral Act for variation of the electoral quota. This idea is nothing new. We only want an existing provision in the Act implemented.

Let me go on to mention briefly the Federal Aid Roads Agreement. It will not come up for extension again for a while yet. Everywhere, I find people congratulating the Government for the’ Federal Aid Roads funds that are being allocated for rural roads. Moneys are allocated to the States under this Agreement and the States are required to spend on rural roads 40% of these funds. A rural road is not a main road or a highway. It is a country road over which primary producers transport their products and the goods that they need. The provision of good rural roads enables them to do this more cheaply. I know of a man who formerly had to transport 30 miles by road superphosphate that he need for his property. The provision of Federal Aid Roads funds has made possible the construction of a new road and new bridges and as a consequence he now has to transport his superphosphate only 8 miles. This saves him £1 a ton on 1,000 tons. So the people of the Malee and Wimmera electorates and of all other country electorates are very pleased with the Government’s policy of requiring 40% of Federal Aid Roads funds to be spent on rural roads. Any move in city quarters to have this policy changed must be squashed immediately. We must not under any conditions have it changed.

I now move on to deal briefly with the agricultural rehabilitation loan of $6,000 for ex-servicemen who have served in Vietnam. I believe that this sum is totally inadequate in view of land prices today. It would be enough to buy only about 60 acres and an ex-serviceman would not be able to get the loan to buy so small an area, because it would not be a living area. The loan will be granted only in respect of a living area. So what is the good of providing only $6,000. The loan limit must be. extended. Furthermore, the period within which it will be available ought to be extended beyond twelve months from the date of discharge from the forces. I have today received a letter on this subject from Mr Harry Carter,

Honorary Secretary of the Lake Boga Branch of the Returned Services League in Victoria. Not many RSL branches have sent me letters on this subject. I believe that the basis on which the loan of $6,000 is made is completely wrong. If I consider a thing wrong, I believe that I ought to say so in this House. Through you, Mr Deputy Speaker, I ask the Government to be more realistic, to reconsider the matter and to take account of current land prices.

Before my time expires I want to discuss estate duties. In this House I have asked the Prime Minister: ‘Will you give a clear lead and ensure that valuations of land for probate are not based on the prices being paid for land as indicated by recent sales?’ When the head of a family who owns a property dies, a tremendous sum is taken out of the estate because of the high prices now being paid for land. I am against that being done. I understand that at Camperdown and other places on the Victorian coast land is selling at more than $300 an acre. Is this to be considered the real value of land? If it is, what will be the effect on families that have held land for generations? They may have no thought of selling any of their property, but when the head of a family dies a great deal of money will have to be taken out of the estate to pay probate. The families of most primary producers want to stay on the land.

I conclude by returning to the Budget. This is a Budget providing for no increases in taxation and no rise in pensions. I have said very clearly what I think about the pension situation.

Mr Uren:

– The honourable member says that the Budget provides for no increases in taxation. What about the increases in postal charges?


– Do the people believe that the Postmaster-General’s Department needs more money to continue the services that it provides at present? If it does need more money, where is it to come from? It can come from only one of two sources - the taxpayers or those who use the services. If the money is obtained from the taxpayers by means of higher taxes, those who use the telephone and other services uneconomical^ only embarrass everybody else. So the money has to be obtained from those who use the services provided by the Department. All that I say about this is that if the

Budget is approved and the Government receives the additional money, we shall have improved telephone services. The increased charges provided for in this Budget are said to be a taxation measure. There is a very good definition of the art of taxation. It is stated in these words:

The art of taxation consists In so plucking the goose as to obtain the largest amount of feathers with the least amount of hissing.


– It was with some regret that I sat in this House and listened this afternoon to the honourable member for Mallee (Mr Turnbull). During the time I have been a member of this Parliament I have heard him make some great contributions to our debates, but it has upset me somewhat to note a mental deterioration in the honourable member and I suggest to him that in his own interest he should seek proper medical advice. I am genuinely concerned about him. In expressing agreement with the Government’s increases of postal charges the honourable member was apparently unmindful of a decision of the annual conference of the Country Party in Western Australia which passed a resolution stating that the Government was using the postal increases as a taxation measure. One could reasonably have expected the honourable member to refrain from defending the Government’s action rather than endeavour to mislead the Parliament and the people of Australia.

The honourable member made some references to Vietnam, and apparently he has either slanted his statements on Vietnam or he has not read the material on the subject which is available in the Parliamentary Library, where there is ample evidence that people m all parts of the world are against this Government’s involvement in Vietnam. However, 1 shall speak at greater length on that subject later.

I take the opportunity of expressing my support for the amendment moved by the Leader of the Opposition (Mr Whitlam). I must say 1 congratulate the honourable member for Mallee on the statement he made to the effect that the pensioners of this country are not being properly treated by the Government. 1 intend to allow this subject to dominate my remarks this afternoon. The Australian Government is a signatory to the United Nations Universal

Declaration of Human Rights, which states in Article 25:

Everyone has the right to a standard of living adequate for the health and well-being of himself and his family, including food, clothing, housing and medical care and necessary social services and rights to security in the event of unemployment, sickness, disability, widowhood, old age or other lack of livelihood in circumstances beyond his control. Motherhood and childhood are entitled to special care and assistance. All children, whether born in or out of wedlock, shall enjoy the same social protection.

What is the attitude of this Government towards unmarried mothers, for instance? An unmarried mother may obtain social service benefits for 6* weeks after the birth of her child. Then she is expected to go out and get a job if one is procurable. Should not a pension be granted to such an unfortunate person, similar to that which is given to a young widow, until her child is of school age? I also believe that fairer treatment should be meted out to the wives of prisoners in gaols. Under our existing arrangements no social service benefiits are available to wives of prisoners until at least 6 months after the commencement of the prison sentence. We should also consider the position of deserted wives. They cannot obtain pensions until 6 months after their husbands have left them. 1 have frequently asked, as have several of my colleagues on this side of the Parliament, when the Government intends to make medical specialist treatment available for pensioners at little or no cost, lt has taken the Government years to accede to the Labor Party’s request to provide hearing aids for aged persons, and I am eager to ascertain the conditions that will be attached to the lending of these hearing aids. I want te know whether any costs will be involved and whether a hearing aid will be available to a person for as long as he may require it. I agree that it is only fair to provide that a hearing aid be returned to the Government authorities on the death of the person using it or on his recovery after medical treatment.

The Budget has done almost nothing for the half million Australian citizens living in or on the fringe of poverty and malnutrition. To gain some idea of the plight of many of our aged, invalid and widow pensioners one has only to study a book on poverty in Australia which was published recently after long and careful research and which is available in the Library, called The Hidden People’. How true was the statement of the Leader of the Opposition in his Budget speech last Tuesday night when he referred to the Government’s special concern for powerful groups and its lack of concern for those without special influence.’ Of course this Government cares for the rich but cares very little for the poor. In connection with the rich 1 am reminded of a statement made by Andrew Carnegie in 1889. He wrote an article in the ‘North American Review’ in which he said:

The man who dies rich dies disgraced. The day is not far distant when the man who, leaving behind him millions of available wealth which was free for him to administer during life, will pass away unwept, unhonoured and unsung.

I say the time is not far distant when this Government, which is providing for the rich and privileged sections of our community, will be swept from the Treasury bench, unwept, unhonoured and unsung.

It is undoubtedly true that this Budget is a sectional Budget, the product of a Government propped up by sectional interests. It ignores the needy and supports the greedy. Despite the opinion of the overwhelming majority of Australian citizens who voted in a referendum on 27th May last for a better deal for Aboriginals, this Budget provides nothing to improve the lot of our Australian Aboriginals who for too long have been deprived of the simplest animal needs of human beings - food, clothing and shelter. Each day at the commencement of our proceedings in this Parliament, Mr Speaker pledges in a very impressive manner that we will do out utmost for the welfare of the people of Australia. I say, as many outside the Parliament think, that this can often be interpreted as hypocrisy. 1 do not use that word with any relish and I would not use it if 1 did not think it was appropriate.

The time is long overdue for the social service legislation of this country to be extended to cover the provision to retired mine workers of the free medical care that is enjoyed by other age pensioners. Many mine workers spend their working lives in the bowels of the earth, contracting the many lung diseases that this hazardous occupation brings on, such as miner’s silicosis, dusted lungs and bronchitis, only to find on retirement that the savings which they have so carefully amassed in order to purchase some of the comforts long enjoyed by the privileged sections of the community, which this and other Tory governments have nursed for so many years, are rapidly used up in meeting exorbitant medical and hospital costs. Free medical treatment for retired mine workers is long overdue. Socialist countries of the world can extend this just due to their salt of the earth. Why cannot this Government do the same? Is it because the mine workers in the past have stood out for their just rights resulting in their being branded militants by the powerful magnates of the monopolistic Press of this nation? Their just request for relief from the excessive burden of medical expenses is ignored by this Government. Because of the changing economic circumstances, particularly in coal mining areas, we have been agitating to have expenses incurred in travelling to work allowed as an income tax deduction. On frequent occasions the Government has said that it would consider giving a reasonable taxation rebate to persons who were retrenched from certain phases of industry and then had to travel long distances to their new work places. We have asked for at least $100 a year, or approximately $2 per week as a tax rebate to offset their travel expenses. This request has been repeatedly ignored by the Government in Budget after Budget. I think that such a concession would be just and proper. If the Government wishes to hold or to retain the respect of the electors of this country it should give urgent consideration to the matter.

I now want to make some reference to the continued failure of the Government, despite repeated appeals by Labor members on this side of the House, to initiate steps either by means of this Budget or by legislation, to protect Australia’s indigenous fuel, coal. The coal markets are being constantly intruded upon by foreign oil companies. We have had the experience only recently of Australia’s petroleum purchases from the Middle East being discontinued because of the political turbulence and the conflict between Israel and the Arab countries. We were able to produce petrol and oil from the rich shale deposits at Glen Davis and Newnes, but this Government closed down the works at those places. I am far from satisfied that the Government has ever made a sincere effort to produce oil, petrol, chemicals and other by-products from coal with the object of achieving Australian independence from the domination of the foreign owned oil and chemical companies. This month’s issue of the magazine ‘The Coal Miner’ contains an article on page 11 which deals with the already insecure position of the Collie mine workers in Western Australia. Their position is to be further jeopardised by a decision of the Western Australian Liberal Government to double the capacity of the oil-fired Kwinana power station, as the next step in power extension in that State. This decision of the Western Australian Government is regarded as a major blow at the Collie coal field and the Collie miners are reported to be heading a campaign - to my mind justifiably - to force the Western Australian Liberal Government to publish the price it was paying the BP company for fuel oil from Kwinana. Everyone should know that the oil companies are constantly encroaching on traditional coal markets to the detriment of Australia’s indigenous fuel and to the economic detriment of the unfortunate people who live and are employed in coal mining townships. They reduce the price of fuel oil until coal is eliminated. The ruthlessness of the oil monopolies should be well known to us all. Honourable members who wish to acquaint themselves with the economic brutality and manipulative measures to which the oil companies resort would do well to read Jules Abel’s book ‘The Rockefeller Millions’, a copy of which I have in my hand. I wish to quote the following two lines from page 233:

In view of Standard’s well known penchant for infiltration, the prospectus had an interesting clause.

The reference, of course, was to the Standard Oil company. We know that the Prime Minister (Mr Harold Holt) has stated in this House that on his visits to the United States of America he has often been the guest of David Rockefeller. So, we can hardly expect this Government to protect Australia’s indigenous fuel against the powerful influence of Standard Oil and the Rockefeller millionaires. I will continue to protest against these things as long as I remain a member of this Parliament. We know that the Rockefellers are the principal shareholders of Standard Oil of New Jersey which has vast oil interests in Venezuela.

I now want to make some remarks about the war in Vietnam which concerns me considerably. I know that this subject also is of concern to other members of the Labor Party. We have learnt about the great profits that are made out of wars. We read in the daily Press and in magazines in the Parliamentary Library of the exorbitant profits made by the Ferranti company in Great Britain. This company, after exposure of its excess profits recently, had to pay back to the British Government some £Stg5m. Recently the magazine ‘British Economist’ reported that the Hawker Siddeley company of Great Britain had made approximately £Stg9m in excess profits in fulfilling an order for bombers for the British Government, ls it any wonder that wars such as that in Vietnam are being instigated, sponsored and backed by the war hawks of the Western world when such exorbitant profits are to be made? This Government in recent times purchased a number of Hawker Siddeley aircraft from this very company, which has embarrassed not only itself but also the British Government with the extent of its profits. I want to know whether the Australian taxpayer is entitled to some compensation from Hawker Siddeley out of the excess profits it may have made in selling aircraft to this Government.

Mr Giles:

– What Hawker Siddeley aircraft?


– The Government purchased one for its VIP flight recently. I want to know how much excess profit-

Mr Giles:

– It purchased two.


– The honourable member says two aircraft were purchased. I know that he resents my mentioning these things. He is a devot Tory. Before I depart from the subject of war profiteering I would like to mention that the magazine ‘The Progressive’, which can be found in the Parliamentary Library, deals with the activities of war profiteers following the Korean War and with war contracts involving the United States Government. The magazine states: - The War Contracts Adjustment Board, predecessor to the present Board, recovered more than $11 billion in ‘excess profits’ from private contractors doing business with their governments during World War II. More than $800m was recovered in the aftermath of the Korean War. The real question is, how much got away?

I have not the time to place on record any more of this very illuminating article. II our daily newspapers were to print some of these statements, which I believe are factual, the Australian people in general would be appalled by them and particularly by Australia’s involvement in the Vietnam war. The Government would be swept out of office. How does a person ascertain the truth about what is going on in the world and the profits that are being made out of wars? If a person were not a member of the Parliament and did not have access to the Parliamentary Library he might be as ignorant as are many of the Australian voters. Years ago, because of the unfair treatment by the Press of this nation, the Labor Party instituted the broadcasting of proceedings of Parliament so that the people of the nation, if they cared to listen to the radio, could get some idea of the truth of the debate, not a warped report of it from the Press.

Mr Killen:

– Is the honourable member making another attack on the Australian Press?


– I thought that I had made it very clear. Do not tell me that you have been out in the moonlight and have misinterpreted what I have said. I thought that I had made it very clear where I stand in this Parliament. If the honourable member listens a little more I might be able to enlighten him by a few more frank statements.

Now I refer to a question asked of the Attorney-General (Mr Bowen) this morning. We all recall the question which the Leader of the Opposition (Mr Whitlam) asked in order to pin down the AttorneyGeneral. He asked him for a decisive answer. I interjected and said: ‘Answer Yes or No.’ The Leader of the Opposition asked the Attorney-General whether he had ever sanctioned the tapping of telephones of members of Parliament. After a long diatribe the Attorney-General said: ‘I will neither affirm nor deny it.’ To my .mind it was a confession by the Attorney-General that he had sanctioned the tapping of telephones of members of Parliament. Day after day, while this Government remains in office, the freedoms of the Australian people are being gradually whittled away. Day after day this country is becoming a

Fascist State. I hope that 1 can demonstrate and prove to the Parliament just how much this country is becoming a Fascist State under Toryism. We know that in the next few days legislation will be introduced in order to prevent university students at the University of Melbourne from sending medical aid to North Vietnam to relieve the burnings and sufferings of children in the civilian community. But did this Government make any protest to the Canadian Government when approximately nine to twelve months ago a shipment of medical supplies, which was supported and condoned by the Canadian Government was sent to North Vietnam for the relief of the wounded and the maimed as a result of phosphorus and napalm attacks with which the good name of Australia has been aligned? I return to the answer of the Attorney-General this morning when he said: ‘I will neither affirm nor deny it.’

We all recall that the former Prime Minister. Sir Robert Menzies, was given a very important assignment at the time of the Suez crisis. He was asked by the British Government to lead a mission to Egypt to talk to President Nasser concerning President Nasser’s intention to nationalise the Suez Canal because of the failure of a promise given by the United States, Great Britain and France concerning financial aid for the building of the Aswan Dam. We know that Sir Robert’s mission to Suez was a complete flop. We also know that it virtually cost Anthony Eden his job. John Strachey, a British statesman, referred to it as the greatest blunder that the United Kingdom had made in the last decade. After Sir Robert returned to Australia he wrote a personal letter to Anthony Eden who was then Prime Minister of Great Britain. I shall quote from page 471 of the book entitled ‘Anthony Eden’s Memoirs’. In this book Anthony Eden quotes a part of the letter which was written to him by Sir Robert. I quote from what I believe is an authentic document. Anthony Eden stated:

The committee finished their work on September 9th. They then dispersed and Mr Menzies new back to Australia by way of London and Washington. On arrival in Melbourne, he sent me the following personal letter:

You have about as difficult a task over Suez as mortal man ever had. I am sorry that we have not been able to get it solved for you in Cairo. Our report and, in particular, our aide-memoire to Nasser will give a pretty fair picture of the arguments that we were using and of those we encountered. There are some aspects of this matter, however, which no committee could officially mention but which I would like to put down for your personal assistance.

This is the most important part of the letter, so far as I am concerned. Sir Robert went on to say:

Egypt is not only a dictatorship but it has all the ear marks of a police state. The tapping of telephone lines, the installation of microphones, the creation of a vast body of security police - all these things are accepted as commonplace.

Mr Uren:

– Who said that?


Sir Robert Gordon Menzies, K.T., C.H., Q.C., holder of the thistle and captain of the Cinque Ports. I think I am perfectly entitled to allege that the freedom of the people of this nation is being whittled away day after day by a Government that is rapidly galloping towards a Fascist police state. I was surprised that in this year’s Budget there was not an increased allocation for the Security Service. I recall that last year’s Budget provided an increased allocation for the Security Service of this country to buy additional equipment. I alleged - and it was never denied - that it was to buy eavesdropping instruments. 1 know that the Security Service has those things - the very things for which the former Prime Minister bitterly condemned the Nasser Government in a personal letter to Anthony Eden. What is the position today under Toryism in this country? We find that the underaged are fighting in Vietnam and the overaged are starving in the back streets of our capital cities while overseas investors are sneaking out of the country night after night with a bag of our rich mineral resources slung over their shoulders. This will continue under Toryism until the people of Australia are properly enlightened as to the evilness of this Government and what it is doing to this great nation.


– I have been wondering what the honourable member for Hunter (Mr James) has been saying over the telephone that has caused him to be so disturbed by the remarks of the Attorney-General (Mr Bowen). I strongly disagree with the remarks made by the honourable member for Stirling (Mr Webb) regarding the Budget proposals for national development. On the contrary, I would like to record my appreciation of the Budget proposals for the corning year regarding national development. As I see and know it, our rate of growth will be sustained, and the year ahead can be faced with confidence and without worry.

On the subject of national development, there is one very important matter to which I would like to draw the attention of the House. Within the time allotted to me 1 will try to endeavour to explain to the House a proposal for a development scheme which in my mind is of national importance and which could be of such decided benefit that party politics should be forgotten and not allowed to intrude into any discussion on the subject which may delay or jeopardise the implementation of the proposal. The development scheme that 1 have in mind is known as the Burdekin River project of north Queensland. I do not know whether this scheme has been presented fully to this House before, but in order that it might be understood more completely, I shall explain briefly its early history.

As most honourable members are aware, the lower Burdekin area is one of the richest sugar producing areas in north Queensland. It depends almost entirely upon underground water supplies for irrigation purposes and for domestic needs. Because of the lowering of the water levels in the underground reservoirs due to the unprecedented inadequate wet seasons, which meant the Burdekin River was not carrying sufficient run-off to recharge the underground basins, a proposal to dam the river to offset this situation was initiated and presented to the Queensland State Parliament 1 believe this was done in the late 1940s. An investigation of the proposal was made and in 1951 a completed report was submitted to the State Government. This report was known as the Kemp report and was most comprehensive. The major suggestion in the report was that a dam be constructed on the Burdekin River, the construction to be undertaken in four stages. Stage 1 was to have a storage capacity of 6,600 acre ft of water. That has now been completed and has provided water for the development of 200 farms in the Clare, Millaroo and Dalbeg areas. These are now producing sugar cane. Stage 2 was to have a storage capacity of 420,000 acre ft and that would provide sufficient water for the development of 780 farms. Stage 3 was to have a storage capacity of 4,220,000 acre ft and that would permit the development of 2,800 irrigated farms. Stage 4 was to have a storage capacity of 6,584,000 acre ft and the anticipated number of irrigated farms would then be increased to 3,600. That was the reasoning in the 1950s. As I have stated, stage 1 was completed and a start was made on stage 2 when - no doubt through lack of finance - the State Government had to abandon any further attempt on the dam construction.

In view of the great progress that has been made in methods of agriculture, in pastoral improvement and in the establishment of industries, and in view of the everincreasing population in the area, the situation has changed considerably since then. The Burdekin River cane farmers still need water to replenish the underground reservoir; they need it badly. Last week I listened to honourable members speaking on the salinity problem in the Murray River area. I can assure those honourable members that we have a similar problem on the Burdekin River. In an attempt to beat the water shortage the farmers, on the advice of the Queensland Irrigation and Water Supply Commission, installed their own pumping stations on the Burdekin River and built channels to convey water to the underground intake areas, at a personal cost to the farmers of $7m. This was done to save their farms and the industry on the Burdekin River. Although this has relieved the situation it is not sufficient. The number of people on the Burdekin River affected by the water shortage would be approximately 16,000 to 18,000. I am sure honourable members will agree that this is a magnificent example of self-help, but this type of expensive community effort has a limit, especially in view of the low price prevailing for sugar.

This development is only one reason why a closer look at the Burdekin project is necessary. Just recently the prospect of a new industry for the north is exciting the minds of northern people and interested people in the south. There is a distinct possibility that rice growing on the Burdekin River could develop into a major industry. For the past thirteen years officers of the Queensland Department of Primary Industry have been experimenting with rice growing at the Millaroo Regional Research Station and within the last few months, due to the persistance and perseverence of two brothers, Tom and John Rolfe, it has been proven that a long-grained rice, much in demand in Asian countries, can be grown successfully on the Burdekin River. Samples of this rice have met with the approval of export companies. In fact, I have a copy of a letter received by the Rolfe brothers from an Australian firm of exporters that has branches all over the world. That letter states that samples of this rice met with the approval of their Asian customers and that they would be interested in quantities up to 50,000 tons at $141 to $148 per ton. f.o.b. and had a regular demand for broken rice. Mr J. Woodside, Chairman of Directors of Rice Growers Co-operative Mills Ltd of New South Wales and Mr I. Davidge, General President of the Rice Growers Association of Australia, stated when they inspected the Burdekin rice growing area early this month that possible markets existed in Hong Kong, Singapore, Malaysia, India, Fiji, the Philippines and Indonesia for long-grained rice such as is grown on the Burdekin, and that there was plenty of room for Australian rice industry expansion in view of exploding world population, especially in areas where rice was the staple item of diet. Surely this is the answer to those sceptics who have declared that no worthwhile crop could be grown on the Oakey and Barratta type soils of the Burdekin. Started correctly and sensibly, this rice growing industry could become a major feature in the nation’s economy. But to grow rice we must have water and to get the water we must build a dam.

There is another really worthwhile economic reason why a closer look should be taken at this project. The Burdekin Dam would be the complete answer to the water problems of the city of Townsville - water for people and water for industry. Each year Townsville, the second largest city in Queensland and regarded as the capital of the north, has to endure water restrictions for some months. Within a short time the pipeline that supplies this city with water will be duplicated. This will allow some relief for the people and for existing industries but it will not be sufficient to serve more people, new industries and industrial expansion. The value of Towns ville as an industrial city and major port is fast being realised by southern and overseas people. But how can we take advantage of this realisation to improve our economy if water can only be supplied to meet the existing needs of people and industry? In my opinion, Townsville could be to Queensland what Newcastle is to New South Wales, but the life blood of any industrial city - or any city or area for that matter - is an adequate water supply, and Townsville could be assured of this necessity for the next 50 to 100 years if the Burdekin project was to be completed.

Local authorities within the area have done and are doing their best to cope with the situation and, while the city has prospered considerably over the last few years, a limit to their capabilities must be reached for we all know that local authorities are strictly limited by the existing financial situation and their ability to repay loan moneys. But a guaranteed water supply would mean industrial expansion, more people, greater employment and a more stable local economy.

Another major industry that would benefit by the implementation of this project is the pastoral industry. Beef is one of the greatest income earners we have and in my opinion that position will remain for many years to come. Do not misunderstand me. I am certainly not advocating that we irrigate grazing properties, especially properties the size that they are in north Queensland, but I am suggesting that stock on the properties in the Burdekin area, and there are quite a number of them, could be adequately watered at any time and so relieve the fears and considerably reduce the losses caused by the drought. In the event of a likely drought, stock fodder could be grown and stored. Surely one of the most important lessons that we have learned from the last drought is that we must overcome the shortage of water by conservation. The industry is still not back to normal and our economy must suffer because of it.

The value of being in a position to grow fodder and water stock during a drought has been proved. Two properties that I know of which had a reasonable supply of underground water were in this fortunate position and their stock losses were reduced considerably - in fact almost to nothing.

Then there is the opportunity to grow the right type of pastures for seed harvesting and consequent distribution to grazing properties throughout the north of Australia for pastoral improvement. This is being undertaken quite successfully on a small scale at the present moment. I have visited experimental plots where Townsville lucerne grows waist high and other pastures are as high as my shoulder. Surely that is an indication of what can be achieved if the water supply is adequate. There are many more reasons why we, as a Federal Government interested in improving our status both overseas and domestically, should become keenly conscious of any proposal to complete the Burdekin River project.

Fruit farming and small crop farming in the Charters Towers area could be undertaken. The climate and soil are ideal for this. All they need is a guaranteed water supply. There is no doubt about a market being available for the produce. Then again, there has been a lot of talk lately about avenues of employment for the hundreds of Aboriginals in the area. With the development I have spoken about, which would eventuate if this project were completed, this problem would most certainly be minimised. Over the past few years there has been a constant cry to people the north - to persuade people to leave the cities and move out to the country and provincial areas. People will move to an area only where constant work is available. To create work we must have industry, and to foster industry there must be an adequate water supply with its attendant services, such as sewerage and hydro-electric power which it would be possible to generate once the project of which I speak were in existence.

I know that the Queensland State Government is extremely conscious of the need for water conservation which will benefit the State and the nation and that, at the moment, it has three schemes under consideration for submission to the Commonwealth Government for financial assistance out of the $50m allocated to all States for water conservation projects. These are the Nogoa Dam scheme, the Kolan Dam project and the Urannah Dam project, which will receive my wholehearted support, but I remain firmly convinced that the Burdekin project could service a greater area and, most certainly, a greater number of people than, say, the Urannah Dam. In fact, after a close study of the situation, I say that there would be no need for the Urannah Dam if the Burdekin project were completed. The storage capacity of a dam on the Burdekin would be many times greater than the volume of water in Sydney Harbour. The State Government is certainly in a better position than I am to form judgment on these matters, especially in relation to the financial situation, but the Burdekin project must be listed for attention in the very near future, because it will prove to be economically justified.

In my maiden speech I stated that the north did not want anything for nothing. We are prepared to work for and to pay for any development which could improve our own economy, the State’s economy and the nation’s economy. The most outstanding feature of the proposal I have endeavoured to explain is that it would commence showing a productive return twelve months after the completion of the project, because the majority of the reasons I have given for implementation of the scheme have already been tried and proved successful. This is not a parochial pipe dream or the dream of wishful thinkers. It is reality, and it could be classed as national development of the highest order in an area which is capable of accepting the responsibility of expansion in agriculture and industry. I am well aware of our parliamentary structure which places the responsibility on the States to make the first move in these matters, but I would like to receive the assurance that when the Queensland State Government submits a proposal to the Federal Government on the Burdekin River project, whether it be to complete the dam, to complete stage 2 of the scheme or just to have a re-appraisal made of the situation, the Government will grant the technical assistance or the financial assistance necessary to do the job that this national development project so obviously warrants.


– The Budget debate has shown conclusively that the Government is worried. My experience over fourteen years tells me that as soon as the leaders of the Government parties - the Liberal Party and the Australian Country Party - indulge in personal abuse of the leadership of the Australian Labor Party and of various members of that Party, it is a clear indication that pressures are building up inside them. This is the tactic they immediately adopt. They draw across the trail the red herring of Communism and blatantly misinterpret our policies. It is the old, old pattern of the lie and the innuendo.

Mr Donald Cameron:

– What is the honourable member going to do about this?


– Very few, if any, of the Government members who have spoken in this debate, have done other than criticise my Party. The honourable member who interjects has been here for a number of months and he has not opened his mouth very often except to interject on some occasions and most times when he has interjected, it has been when the member sitting next to him has told him what to say. He now wants to know what we are going to do about the situation. Let me tell him that in this debate, and during debates in the previous months of this Parliament, members of the Labor Party have espoused our policies on various matters of national interest. Each of those policies has been clearly written and clearly enunciated. During the years that the Liberal Party and Country Party Government has been in office in Canberra not one clear policy- has ever been enunciated by it. I can remember that in 1961 our then leader, Mr Arthur Calwell, suggested that a deficit budget of $100m needed to be brought down in order to put our economy back on a satisfactory footing. At that time the Prime Minister, Sir Robert Menzies, and the present Prime Minister (Mr Harold Holt), who was then Treasurer, said that this could not be done and that it would create untold inflation. But as soon as the election was over, into this Parliament came the same Prime Minister and same Treasurer to do exactly what had been espoused by the Labor Party. 1 ask honourable members to look at the proposal in this Budget to increase child endowment to families with four or more children. This proposal has been espoused by the Opposition year in and year out. I can remember a former Minister for Social Services saying to me, because I had mentioned the topic repeatedly, that if I wanted to get rid of my children he would take them over. The Labor Party knew that parents with more than the average number of children could not possibly afford to maintain them, but it has taken this Government up until now to do something about it. The Treasurer was reported in Hansard a few years ago as having said that the basic wage was capable of maintaining a husband, wife and three children. I do not know whether his marriage has caused him to change his views. Perhaps he now recognises that maintaining a wife and one child costs him more than it cost him to live in his bachelor days. He has changed his views on child endowment. The Government continually changes its views.

I note that some members opposite, in discussing Vietnam and foreign affairs, adopt policies that have been espoused by members of the Labor Party. Many have accepted statements made years ago by a man they continually criticise - the honourable member for Yarra (Dr J. F. Cairns). I can remember honourable members opposite, particularly the honourable member for Mackellar (Mr Wentworth), time and lime again criticising Dr” Evatt, but they are now espousing his views about regional co-operative schemes throughout Asia - views he expressed in 1955. Some members opposite are now espousing the views expressed three or four years ago by the honourable member for Yarra. The trouble with all members opposite is that they are too conservative. They have no new ideas coming up. Unless they get ideas from this side of the House they do not know what to do about the problems confronting them. We need only look at this conservative Budget introduced by a conservative Treasurer to recognise this fact. It took the Treasurer almost sixty years to run the risk of entering into matrimony. That was the first risk he ever took in his life, and this Budget shows that having taken one risk he is not prepared to take any more. He has gone back to his old conservative policies. He has done nothing for the economy or to improve the situation of the pensioners.

It is no wonder that pensioners throughout Australia are in deep mourning. They are entitled to be in deep mourning. The only time they can expect to get anything from this Government is in the budget before an election. I am sorrowful for the pensioners, because time and time again they fall for the old policy of letting them have the few crumbs that fall from the rich man’s table. They accept the 50c or $1 increase that comes to them by way of a pension increase in election years. For the other two years of a parliament they can starve and go without. They have to rely on the help given them by such organisations as the Brotherhood of St Lawrence, the Red Cross, the St Vincent de Paul Society and local councils which provide meals on wheels. For the rest of the time, the Government does not do much. I have heard people from all sections of the Liberal Party and the Australian Country Party say that pensions need to be increased. I have heard one honourable member opposite in particular say that the civilian widows are badly treated, but I will guarantee that he will not vote against the Budget although the civilian widows have not been treated well in it. You people do not realise the needs of the pensioners. You do not appreciate the needs of some of our ex-servicemen who now are unable to work and to earn a living for themselves. This is not entirely attributable to their war service, but certainly war service is part of the cause. Again you have done nothing about them in this Budget.


Order! I ask the honourable member to direct his remarks to the Chair.


– The Government has done nothing about the totally and permanently incapacitated ex-servicemen on this occasion. It is no wonder, Mr Deputy Speaker, that one of the men who was recommended by your Government for a knighthood not very long ago, Sir Arthur Lee, the President of the Returned Services League, has bitterly criticised the proposals in the Budget and the Government’s neglect of our ex-servicemen. Our aid to underdeveloped countries is still below 1% of our national income. Aid to the Territory of Papua and New Guinea has increased by a measly $8m.

Mr Graham:

– Is that not 10%.


– It may be 9% or 10%, but I predict that within a very few years we will be spending more than $8m a year in the Territory of Papua and New Guinea in an effort to keep peace and harmony amongst the people there. It is time for quicker action to be taken particularly in the Territory, but honourable members opposite sit back, pat themselves on the back and say what marvellous jobs they are doing. I guarantee that, unless the Government does more in the Territory of Papua and New Guinea than it is doing now, all Australians will live to regret the Government’s inaction. Our defence expenditure is increasing, but grave doubts are cast on the value we are receiving for our money. This is a bad Budget, a conservative Budget and a Budget that expresses no confidence in the future of Australia.

Mr Deputy Speaker, while I am in this frame of mind, 1 would like to lodge a most emphatic protest at the unrestrained abuse and criticism that is being levelled at the Leader of the Opposition (Mr Whitlam) by members of the Government Parties from the Prime Minister (Mr Harold Holt) down. All of us on this side of the House have come to expect unfounded and untruthful criticism of Labor leaders. The better the leader the stronger the criticism. In the eyes of honourable members opposite, the only good Labor leader is a dead one or a retired one. Arthur Calwell, since his retirement from the leadership, has developed characteristics and qualifications that were denied him while he was Leader of our Party. Our present Leader had virtues as Deputy Leader that he has lost since he became Leader in February last. The tate Dr Evatt, the late Ben Chifley and the late John Curtin, as leaders of the Labor Party were all accused of being anti-American, anti-defence, anti-Australian and proCommunist. In truth, they were the complete opposite and a study of the policies and ideas they expounded will show that many of them are now completely accepted by the Australian community.

Since this session of the Parliament commenced, our new Leader has been attacked time and time again. I am sure it is a planned and concerted campaign resulting from the success of Labor’s candidate at the Corio by-election. Labor is on the way back. The Government recognises this and now any tactic, fair or unfair, truthful or untruthful, will be used by the Liberals and their Country cousins to smear, to besmirch and to disparage the

Labor leaders. There is fear in the hearts of the honourable members opposite. The effort of the Prime Minister the other night has set the pattern. It was a deplorable exhibition of poor taste by Australia’s No. 1 citizen. It must have shocked even his most ardent supporters. It certainly made me feel quite ashamed. It was the effort of a larrikin and not of a Prime Minister. Sir Robert Menzies would have raised his eyebrows in horror and disdain of his successor. The Prime Minister engaged in personal abuse of our Leader on false and unfounded grounds. He also criticised some other Opposition members, including the honourable member for Yarra, on false and unfounded grounds and some of his statements have already been shown to be untrue. His example has been borrowed by other members of the Liberal Party and the Australian Country Party, including the Treasurer (Mr McMahon). The Communist bogy and the structure of our organisation are again being used against us. By the time of the Senate election, the accusations will really have reached a crescendo. But the Liberal case is now much weaker, thanks to the efforts of our new Leader and mw Deputy Leader and a number of delegates at the recent Federal Conference. No-one can suggest that our Leader or Deputy Leader have any sympathy with Communism. They have opposed it wherever they have found it. Both served Australia in the Second World War. Both are good husbands and fathers. No stain of any kind has blemished their reputations. They are good Australians and the Australian people realise that they are.

In the six months that they have led the Australian Labor Party, extraordinary changes have taken place in the public reputation of our Party and in the structure of our Federal Conference and our Federal Executive. It is now completely untrue to say that the Federal Parliamentary Labor Party is controlled by thirty-six faceless men. Our Leader and Deputy Leader and our two Leaders in the Senate are now members of our Federal Executive. Our Leader and Deputy Leader of the Labor Party and the Leaders in the Senate, plus the Labor. Premiers or Leaders of the Opposition in all the States are entitled to attend our Federal Conference. No other political party in Australia can make the same claim.

Mr Turnbull:

– The Australian Country Party can.


– No other political party can make the same claim.

Mr Turnbull:

– That is not true. We made the claim this afternoon.


– The decisions of our Party are made by the Federal Conference.

Mr Turnbull:

– In the back room.


– In the back room be blowed. I have never seen on television or in the newspapers complete accounts of what has happened at a Liberal Party conference or a Country Party conference. 1 have never known of any Liberal Party conference or any Country Party conference being open to the Press and television representatives.

Mr Turnbull:

– But the back room was not open.


– So you say.

Mr Turnbull:

– I say so, yes.


Mr Deputy Speaker, the honourable member for Mallee says that our decisions are made in the back room.

Mr Turnbull:

– They were made on this occasion, yes.


– I am willing to discuss this topic with the honourable member for Mallee if he will tell me the source of the funds that are being provided to build McEwen House. Who is keeping that account?

Mr Andrew Jones:

– What has that to do with the Budget?


– Our decisions, both at the State Executive and Federal Executive level are made in the open and are completely in the public eye. The decisions we espouse in the Parliament are made only after free and frank discussion within our Party room.

Mr Turnbull:

– Yes, in the back room at Adelaide.


– Our decisions both outside the Parliament and inside the Parliament are made after free and frank discussion. Neither the Liberal Party members nor the Country Party members can say this of their decisions. Even a Liberal Party member is entitled to come along to our conferences, provided someone will vouch for his honesty and veracity, and I will admit that there may be difficulty in having that done.

Mr Turnbull:

– That is not a nice thing to say.


– I did not mention the Country Party, but I will do so if the honourable member for Mallee continues to interject.

Mr Turnbull:

– Then do it.


- Mr Deputy Speaker, if you do not control the honourable member I will. I will use some things within my knowledge to control him. I know things about him which have not yet seen the light of day.

Mr Turnbull:

– Do not threaten; tell them.


– When the Country Party and the honourable member for Mallee can show to the people of Australia the same democratic procedures as the Labor Party shows I am prepared to listen to them, whether the honourable member for Mallee reads his speech or not.

Mr Turnbull:

– What a miserable thing to say. I never read my speech.

Mr Turnbull:

– One cannot be expected to take that kind of remark without saying anything. That is a despicable thing to say.


– No-one can say that the Labor Party acts like the Liberal or Country Parties. Under this Government a decision is brought down by Cabinet, is told to Government supporters half an hour or an hour before they come into the Parliament and, like trained poodles, they come into the House and vote according to Cabinet decisions. Occasionally the honourable member for Mackellar might give a feeble little bark, but we never see him bite. Never have I known one member of the Country Party bite or even bark.

Mr Donald Cameron:

– Look at what happened to Sam Benson when he barked.

Mr Turnbull:

– Yes, and to Chambers also.


– If the honourable members want to go back that far I shall go back to Billy Hughes who said that various people here could not lead a flock of homing pigeons; I will tell honourable members what Arthur Fadden said about Harold Holt and Sir Robert Menzies; I will tell the House what the honourable member for Mackellar said about Sir Robert Menzies and Harold Holt; I will repeat what Sir Earle Page said about these fellows with whom, politically, the honourable member for Mallee is now sleeping and has been sleeping since 1949. If he wants to bring up these matters then I shall do so.


-Order! I ask the honourable member for Mallee to cease interjecting. This is developing into a duet between him and the honourable member who is speaking. The honourable member for Lang has the floor and is entitled to be heard.


– I am annoyed because I have had the innuendo, I have had the lie and I have had the smear that is continually uttered m this Parliament by members of the Liberal Party and the Country Party. I know whom I would sooner follow out of Holt and McMahon or Whitlam and Barnard. Whitlam and Barnard are head and shoulders above the other two. I just say in passing off this topic that if these insults are to continue then the Liberal Party and the Country Party can expect exactly the same treatment in return. Our leadership at this stage is good Australian leadership without any tarnish of Communism or anything un-Australian. I do not want little twenty-one-year-old boys with fluff on their cheeks coming into this place and telling us what is wrong with us, or telling the Parliament what is wrong with it. When he grows up we may listen to him, but until that time I think he should be seen and not heard.

In the Budget which was brought down only a week and two days ago there is mention of $1,1 18m to be spent on defence. This is a huge amount. The Labor Party has never voted against our defence expenditure. We may have questioned the wisdom of the Government’s approach or queried the selection of equipment or the efficiency of the administration, but whatever the Government has chosen to allocate for defence purposes has been passed without a dissenting vote from the Labor Party. I abhor the need for this vast expenditure of $1,1 18m on weapons of war. I cannot help thinking how much more could be done if that amount were available for international aid, for pensions and other social services, housing, in providing developmental work and for use in 101 other directions. But if this amount has to be spent on defence, I and the Opposition generally want to see it used wisely and efficiently. I very much doubt that it is being used in this way at the present time. In 1964, at the same time as his announcement about national service training under the ballot system, the then Prime Minister, Sir Robert Menzies, made a number of specific promises about new and modern equipment for our defence forces. Included among the promises was the purchase of 24 Fill aircraft.

The Prime Minister said at that stage, as reported at page 2721 of Hansard of 10th November 1964:

The 24 FI 3] A aircraft which have been ordered from the United States will add powerfully to the deterrent and strike capability of the RAAF. The Government is confident that the FI11A aircraft, which is expected to fly before the end of this year, will amply fulfil its promise as an outstanding military aircraft

That was in November 1964 and it is now August 1967. We are not even certain yet whether the aeroplane will fly properly. We still have no indication of a definite date of delivery. It would be interesting to hear the present Minister for Defence (Mr Fairhall) go through the speech made by Sir Robert Menzies in November 1964, take each one of the announcements made on the improvements to our defence forces and tell us exactly what stage those improvements have reached. I doubt very much whether any of the announcements have been fulfilled. I doubt whether the Papuan Infantry Regiment is yet up to the strength that was aimed at in 1964, whether our RAAF recruitment is up to that stage and whether our Navy recruitment has achieved its aim. Certainly we have not seen the Fill aircraft. There is only one thing of which I am certain out of the announcements made in the defence review of 1964, that is, that national service training has been introduced. But this was the easiest thing to do. All that had to be done was to put some dates of birth in a barrel, draw out a number and of the number of youths who had birthdays on that date pick the physically and intellectually best 20-year old youths and put most of them into the infantry ba tall ion.

I come back to the Fill aircraft. It was ordered in a hurry in 1963 just prior to the election in that year. At that stage the price for the twenty-four aircraft was to be $US125m. The most recent estimate gives the price as $US238m. In 1963 the terms of payment were $20m deposit to be paid in 1963-64 with half yearly cash payments and a final payment in January 1972. But in addition to the price increasing from $US125m to $US238m with further increases expected in the near future, the terms of purchase have also been altered. There are now to be quarterly payments instead of half yearly payments with the final payment being required in July 1970 instead of January 1972. I repeat that there is still no definite date of delivery. Originally the cost of each aircraft was to be $US5.2m; they are now to cost $US9.9m and the price is still rising. It is no wonder that the Acting Secretary of the Department of Air told the Public Accounts Committee early this week that the Government was completely in American hands on this.

The Opposition would like to know who is responsible for this state of affairs. Was it the Minister for Defence in 1963, who hurriedly flew to the United States and made the deal with the full concurrence of the then Prime Minister and the present Prime Minister, who was a powerful member of the Cabinet at that stage, or was it the present Minister for Air (Mr Howson), who was recorded in this Parliament as having said in answer to a question about the rising price of the Fill aircraft that it was a darned good price. The other day in this place during a debate on the cost of the Fill aircraft the Minister for Defence said - I do not quote him exactly, but this is near enough to what he said - ‘Whatever price we pay for this we are getting a good aircraft’. Is it any wonder that the United States is increasing the cost of this aircraft? I understand that when he was in commerce outside the Parliament the Minister for Defence was regarded as a very tough businessman. He wanted all the goods needed for his business at the right price. He wanted to get the most out of every deal. Was this because he was dealing with his own money? Now that he is dealing with the people’s money he says that whatever is the price of the aircraft, we are getting good value. I would like to be on the receiving end of a deal like this. I would like to be bargaining with somebody who makes public statements that no matter what I charge he will be satisfied. I would be out for my pound of flesh. I do not blame the Americans for not being too particular as to how high the price of this aircraft goes.

The Opposition deplores this Budget. We would have loved to see increases made to the various classes of pension. We would have loved to see greater assistance given towards education in the schools and universities. The time is fast approaching when we will not be hoping for these things; we will have the opportunity of putting them into effect.

Mr STREET (Corangamite) [3.57J- Australia’s rate of spending on defence has now reached about 5% of our gross national product. This has been said more than once in the debate. This is a very large and necessary expenditure. The honourable member for Lang (Mr Stewart) referred particularly to expenditure on the Fil l aircraft. I know that the continually rising cost of this aircraft is a great worry to the Government but the rapid advances in technology and the complexity of modern defence equipment make it absolutely essential that orders be placed at an early stage of development of the relevant weapons system, otherwise, as explained by the Minister for Defence (Mr Fairhall) the other day, we would have a large amount of admittedly proved equipment but equipment which was obsolete or at best obsolescent when delivered to our Armed Services.

The Fill is not just an aircraft; it is a weapons system and each aircraft represents a far more powerful and more flexible weapon than anything that the Australian or any other defence force has ever had. From time to time there has been criticism that much of the large amount of money which Australia spends on defence has been spent overseas and that Australian industry has not received its fair share of orders. The Deputy Leader of the Opposition (Mr Barnard) has been especially critical in this respect. In the debate the other day the honourable member for Cunningham (Mr Connor) said that the Charles F. Adams destroyers were bought with obsolescent weapons systems. He criticised the fact that they were refitted on arrival in Australia. In other words, he criticised their fitting with an Australian made and designed weapons system, which is ahead of anything else in production. He criticised their fitting with a weapons system made in Australian shipyards by Australian workmen. The honourable member for Wills (Mr Bryant) yesterday said:

There is no evidence that I can see of Australian thinking to produce Australian equipment for Australian needs.

In the light of statements such as these I feel it is about time the current situation was clearly explained and an outline given of how a very large proportion of Australia’s defence requirement is being met from local sources. Last year about 54% of the total defence vote was spent in Australia. This year the figure is about 70%. Last year was an abnormal year in that the expenditure included payments for large items of equipment which could not be produced locally. In 1966-67 the Department of Supply alone arranged contracts with local industry worth more than $230m - an increase of 40% over the previous year. The first thing that must be recognised is that in this field, as in so many others, the Government has a dual responsibility. Firstly, it has the responsibility to see that the Australian people get the best and most efficient equipment for their defence forces. Secondly it has a responsibility to see that Australian industry makes the maximum contribution possible to those forces. Inevitably those two responsibilities often clash and a decision has to be made one way or the other, or a compromise reached. I propose to show how skilfully the Government has handled this very complex and difficult problem.

I do not think it is fully appreciated that a significant proportion of the total defence vote is spent on such things as buildings, works and housing. Last year expenditure on these things amounted to more than $90m. This expenditure was spread over all of Australia, to the great advantage of the localities concerned. Australian industry got all of that work. I should now like to refer to the three Armed Services individually. I refer firstly to the Royal Australian Navy, which is in the midst of a major re-equipping programme, particularly with guided missile destroyers and submarines. Immediately we see the problem of dual responsibility. Modern naval vessels of the size and sophistication of the Charles F. Adams destroyers are enormously expensive and complex and it obviously would be impractical to make them in this country, not for technical reasons, because I have the greatest admiration for Australian engineers, technicians and workmen - I am certain that they could do the job - but for economic reasons. The small number of ships involved would make the unit cost prohibitively high if they were built in Australia. Consequently the Government ordered them from the United States. The wisdom of this decision is seen in the fact that we look like getting them for about $10m less than the original estimate of the capital cost.

The same thing applies to our Oberon class submarines, which are the most advanced conventional submarines available today. However, when we come to the equipping of our new destroyers we find that they are to be fitted, as the Minister for the Navy (Mr Chipp) mentioned, with the Australian Ikara anti-submarine missile, as indeed are HMAS ‘Stuart’, HMAS Derwent’ and the four escort ships. It is now common knowledge that this weapons system is probably the best of its type in the world and that there are excellent prospects of its being exported to the Royal Navy and to other European countries. This is a great tribute to Australian research and engineering. The missile itself is, of course, only one part of the whole complex weapons system. The electronic guidance and test equipment and the launching and handling hardware also are Australian designed and made. Guided weapons demand an extremely high standard of maintenance. Here again Australian industry is doing the job at the new repair and maintenance facility at St Mary’s, New South Wales. This $2.3m centre is equal to any facility of its type anywhere. However, although our guided missile destroyers and our submarines are overseas products, Australian shipyards will supply nearly all other ships which the Royal Australian Navy requires. These include the 14,500 tons escort maintenance vessel HMAS Stalwart’, built at Cockatoo Dockyard. All told 23 new ships are under construction in Australian shipyards, including two type 12 escorts and twenty patrol boats. Some of the latter are being built at Maryborough, Queensland. This is an excellent example of encouragement to decentralised industry. Ships of the Royal Australian Navy get their refits in Australia. In the case of HMAS ‘Melbourne’ this will amount to about $7m.

When we come to the Army, which is easily the largest numerically of our armed forces, Australian industry provides an impressive proportion of its needs - 80% of its total equipment costs of $86m. Additionally some of the needs of our allies are met in Australia. I cite as an example the special lightweight sleeping equipment developed in this country. The achievement of the government clothing factories in exporting to fourteen countries is remarkable. An excellent example of the works and building done for the Army is the Townsville Army base. All Australians may be extremely proud of this base. The standard of construction and the facilities provided are absolutely first class.

Australian industry is supplying the Army with a wide range of electronic communications equipment, to the value of $4.5m. Special mention should be made of the PRC-F1 light weight high frequency transceiver. This is of very advanced design, has been completely developed in Australia and will shortly be in large scale production. This and other projects connected with the aircraft industry which I shall mention in a moment will ensure that our electronics component manufacturing industry is up to world standards. The government ordnance factories are producing an astonishing range of equipment, from rocket motors to ammunition boxes. A good example is the shell “forging plant at the Maribyrnong ordnance factory, which is completely Australian designed and equipped and is an outstanding example of modern engineering. There, the latest techniques such as explosive forming are under development.

We produce our own 7.62 mm. automatic and self loading rifles at Lithgow and also the 9 mm. FI submachinegun. A large order has been received from the United States of America for 7.62 mm. ammunition. Many types of ammunition for the 105 mm. howitzer are now made here and also the ammunition for American designed 81 mm. mortar. This mortar ammunition is extremely complex and its production involves ten contractors in industry as well as government factories. Three major contractors and many sub-contractors will combine to produce a new clockwork fuse. This fuse, incidentally, represents probably the finest achievement of high precision engineering in Australia today. On a much larger scale, the Government Engine Works last year delivered ships diesel engines of up to 10,500 horsepower. Some $20m has been spent on the development and production in Australia of special two and a half and 5 ton trucks for the Army. These are designed to fulfil very stringent requirements and are proving most successful. A replacement for the Land Rover is now to be developed in Australia and production will involve, it is expected, about 4,000 vehicles at a cost of $19m.

However, Sir, it is when we come to the Royal Australian Air Force that we see the most dramatic proof of the Government’s faith in local industry and the encouragement given to it. In this country, we are making first line combat aircraft and this means that we are engaging in the most advanced and sophisticated mechanical’ engineering in the world, as typified by the Mach 2 plus Mirage fighter and strike aircraft. The prime contractor for this machine is the Commonwealth Aircraft Corporation Pty Ltd, a unique company in the field of aircraft construction in that it builds both airframes and engines. Over 80% by value of the Atar engine is now made in Australia - a truly remarkable achievement when one considers its complexity. It must be a matter of great pride to Australian industry that only recently we received an order for aircraft engine turbine blades from Rolls-Royce. Surely no higher compliment could be paid to us than this modern version of carting coal to Newcastle. The Government Aircraft Factories and the Commonwealth Aircraft Corporation between them employ more than 6,000 persons on the Mirage and Macchi aircraft, the Ikara missile and the Jindivik target aircraft. This last, of course, has been exported to many countries.

Although the two firms mentioned are the main contractors for this work, many other companies have received orders for items such as drop tanks, wheels and brakes, starters, pumps, instruments and many other items. These orders, by familiarising the companies concerned with the most modern engineering techniques, will inevitably raise the standards, skills and knowhow of Australian industry generally and the benefit will therefore extend far beyond the immediate defence field into production for civilian purposes. The new Macchi trainer which, incidentally, may have export prospects in New Zealand, is to be built in Australia to the extent of more than 80% by value. CAC and Hawker de Havilland Australia Pty Ltd will be the main contractor. But, here again, many other companies will share in the production. For example, the oxygen regulators will be made locally and the company that produces them will manufacture the ADF systems also. This will be the first time any of this kind of equipment has been made in Australia. I sincerely hope, Sir, that the supersonic advanced trainer designed by the Commonwealth Aircraft Corporation will eventually be added to this list and so ensure continuity of employment for our aircraft industry.

At this point, I must say how disappointed I have been at the Government’s attitude to the light aircraft industry. It will be recalled that earlier this year the Tariff Board advised - reluctantly, to use its own word - against a government bounty being granted to local manufacturers, and this recommendation was accepted by the Government. In my opinion, this is a short sighted decision and one that will almost certainly be regretted in the future. Another Tariff Board hearing will be held but it is now too late for the major light aircraft manufacturer. At the time of the previous hearing, this firm was producing a twoseat training aircraft which was Australian designed and built and which was not only good but probably the best of its type in the world. As a result of the Government’s refusal to pay a bounty, the firm sold all its jigs and equipment to a New Zealand company. The aircraft is now back in production in New Zealand and we shall shortly have the situation of Australia importing a machine that was originally its own. This unfortunate state of affairs has defence implications. Recently, both the United States Air Force and the Royal Air Force decided to revert to the use of piston engine light aircraft for initial training, mainly on the grounds of economy. Although the

RAAF, I know, is committed to allthrough jet training, the same is not true of the expanding Army Aviation Regiment. It was initially interested in placing an order which would have given great encouragement to the firm that I have mentioned and which might have enabled it to continue in production.

I now get back to the RAAF, Sir. The overhaul and maintenance of its electronic equipment is a large item which last year was worth $10m to private firms. With even more advanced aircraft such as the Fill coming into service, the electronics industry can expect greater opportunities in this field. But I believe that it will be equal to any demands made on it, as is evidenced by the recent opening of a Sim semi-conductor laboratory in New South Wales - semiconductors are used largely to replace transistors in modern equipment - and the building of an advanced avionics workshop by Qantas Airways Ltd to handle the most modern systems. This emphasises the fact that much of our expenditure on civil aviation projects has important defence implications. We not only have a first class network of airports throughout the country but also our navigational aids are of equal quality. The communication systems of the Department of Civil Aviation are of world standard. Much of the equipment used is made in Australia, such as the new HF transmitters recently ordered from two Sydney firms. These transmitters, which will improve weather information and international communications, are of Australian design and are much simpler than existing types. All told, this major programme will cost nearly half a million dollars. The Australian electronics industry last year supplied nearly $3m worth of equipment to. the Department and this year it will supply about $5m worth.

Australia has also played a notable part in the development of space tracking techniques and has gained from this work knowledge that has been of great value to the Weapons Research Establishment at Salisbury and the Woomera rocket range, where we are producing and testing advanced operational guided missiles such as the Ikara, Rapier and Entac, to name three. Sparta, the joint project on the re-entry physics of ballistic missiles, is in progress at

Woomera, together with work on rocket motor propellants and high temperature materials. The Defence Standards Laboratories are providing scientific services for defence industry, and undertaking work in the fields of chemistry, physics, engineering, physiology and biochemistry - fields that are not covered by any other organisation. For example, its fuels and lubricants section arranges the purchase of these items for the defence forces to the value of many millions of dollars a year. This section has a world wide reputation, as is evidenced by its being called on recently to advise the largest United States domestic airline on fuel problems. The Aeronautical Research Laboratories at Fishermen’s Bend are providing first class facilities for research into many problems related to metal fatigue, structural designs and all facets of aerodynamics.

Having mentioned the specific items I should now like to review the broader picture of defence requirements and some possible prospects for the future. There are, for instance, great opportunities for Australian industry to obtain important orders for equipment and also research and development contracts from the United States. The Minister for Defence (Mr Fairhall) has, of course, recently been in America discussing this very question. Any such contracts would be of assistance not only to Australian industry but also to our adverse balance of payments problem with the United States.

No doubt one of the subjects under discussion when the Minister was in the United States was project Mallard, the three nation defence communication system for Australia, Canada and the United States. This appears to be one of the most ambitious international schemes ever attempted, and although the main contracts will probably not be let for some years, research and development work is now being undertaken by Australian industry. Some idea of the importance of this project can be gained from the fact that the total cost could be between $500m and $ 1,000m. It is expected that Australian firms will be able to tender not only for our own requirements but also for some United States and Canadian equipment.

Another project with great future possibilities is Nangana, an improved method of submarine detection which is being investigated by the Department of Supply. Further proof that the Government is doing all in its power to encourage Australian industry to supply our defence needs was given earlier this year when the Minister for Defence announced a nine-month course for thirty-six senior representatives of industry, the Services and Government agencies to study the problems of industry supporting our defence effort.

It is easy to criticise the Government when it makes a decision to buy some items of equipment from overseas, but, as 1 mentioned at the start of this speech, the Government has a responsibility to see that the Australian taxpayer gets the best equipment for his money. Like all honourable members I look forward to the time when we are sufficiently industrialised and with a large enough population to supply all out defence needs. In the meantime I consider that the Government is giving every assistance and encouragement to local industry which in its turn is taking advantage of its opportunities to a remarkable degree, thereby raising its technical standards and helping to put all our secondary industry on a broader and firmer base, to the overall benefit of the Australian economy.


– The honourable member for Corangamite (Mr Street) has for the last twenty minutes been telling us a laudatory tale of the grand position in which the defences of this nation now stand. I recommend that anyone who has been unfortunate enough to hear him, and also those who may later read his speech in Hansard, should also read a series of articles that commences in today’s Sydney ‘Sun’ under the heading: ‘What Did We Get For Our Billions?’. These articles have been specially written for the ‘Sun’ by the defence expert of the ‘Financial Review’, Peter Robinson. He starts off:

Australia’s defences are in a shambles - but it is no ordinary backyard she’ll-be-right-mate kind of shambles. This is a shambles on a grand international management scale; a Sydney Opera House shambles magnified a hundred times.

Then he goes on to give details of the story of all the mismanagement that we call a defence programme for Australia.

Every Treasurer of Australia since 1950 has boasted of the prosperity and the national economic growth that have resulted from Government policies. The increased indebtedness of Australia in overseas countries since 1950 has been more than $6.000m. The growth of national production per man in the employed labour force between 1965 was 1.8% in Australia, 8.1% in Japan, 2.6% in Canada, 4.4% in France, 6.2% in Italy, 4.2% in Germany, 2.3% in New Zealand and 2.6% in the United Kingdom. The Treasurer has said that the Budget is an investor’s and, above all, a businessman’s Budget. One member of the Opposition after another has made clear how all concessions granted in the Budget help the wealthy and neglect the interests of pensioners and workers. This Government may temporarily assist the wealthy here and overseas, but its economic and financial policies represent a gross betrayal of the interests of future generations of Australians. These policies have made it more and more difficult for Australians to obtain a share in the properties or industries of this country.

Future generations of Australians may inherit a country which will have, in place of immense mineral resources, only holes in the ground, and will be dotted with numerous ghost towns constituting memorials to the industrial activity and prosperity of today. They may well inherit an Australia the industries and properties of which will be owned and controlled in other lands. Must future generations of Australians pay most, if not all, of the rent on Australian properties, the profits made in Australia, and the interest on loans raised for the development of Australia, to people in other lands? The interest payable overseas in 1966 amounted to $375m, and of course this will continue to increase year by year.

The Minister for National Development (Mr Fairbairn) wrote an article for the Brisbane ‘Courier Mail’ which was published on Tuesday, 1 1th July 1967, in which he said: ‘We welcome overseas investment’. He pointed out that vast mining projects to develop the resources of Australia, particularly minerals, are bringing people to remote, thinly-populated areas in the west, the north-west and the north, resulting in the construction of many facilities which otherwise would not have been provided. He also stated that Australia is short of local capital to finance the vast number of complex projects which add up to national development. ‘Consequently’, he said, ‘we welcome overseas investment particularly when this can be made in association with Australian companies or institutions’. In the same issue of the ‘Courier Mail’ was a statement by Sir William Gunn, in which he said: ‘Foreign capital is vital for our empty north’. In defending his advocacy of foreign capital for northern development Sir William said: ‘Without the inflow the north would remain a useless waste’.

When assessing the value of overseas assistance to promote the rapid development of mining in Australia it should be remembered that future generations of Australians will inherit holes in the ground that were once vast repositories of irreplaceable minerals essential to national existence. Minerals are very different products from wheat and wool. They cannot be replaced in a season; they are irreplaceable. It should be remembered, too, that the thriving mining town of today is the ghost town of tomorrow. When assessing the benefits of ownership of station properties it is good to remember that overstocking has turned productive areas into dust bowls. Surely the present generation should exercise restraint in the exploitation and exhaustion of national resources that once used can never be replaced. They should do this in the interests of future generations of Australians.

The overseas investment in raining and pastoral properties is, however, only a small fraction of the total overseas investment in Australia. The vast proportion is used in the takeover of established industries. Briefly, here is the story of the flow of capital into Australia, from 1949 onwards when it ceased to be a trickle and became a torrent. At 30th June 1950, the Commonwealth and State debt owed overseas totalled $ 1,099m while international reserves totalled $l,259m. The overseas investment in Australia was about $800m. In 1967, Commonwealth and State overseas loans totalled over $ 1,500m and international reserves totalled $1,200. The overseas investment in Australian companies was over $5,000m between 1950 and 1967. It would appear from these figures that the overseas indebtedness of Australia has increased by $4,600m since 1950. This, of course, does not take into account the value of much real estate sold to overseas investors. Nor does it take into account the increase over the years in the value of assets owned by overseas interests. For example, in 1947 General Motors-Holdens Pty Ltd owned assets in Australia worth less than $4m. It now owns in Australia assets worth hundreds of millions of dollars. The assets of other companies similarly have increased in value. It would therefore be correct to say that overseas interests now have assets in Australia worth many times the value of the capital invested in the country.

The statements of the Minister for National Development (Mr Fairbairn), and Sir William Gunn are similar to those being made by Government supporters and big businessmen who generally support the flow of foreign capital into this country for all and every kind of purpose. The present Government is anxious to sell the mineral resources of Australia, its land and industry to overseas investors as rapidly as possible. Those foreign interests will use every device to exhaust the mineral resources of their holdings in the shortest possible time. Government supporters point to certain Australian industries owned by overseas investors that are temporarily speeding up development and are temporarily increasing Australian production and would have the Australian people believe that there will be no end to these benefits and that from every type of foreign ownership this country and its people can reap advantages.

Let rae emphasise that there are few, if any, Australians who do not believe in borrowing from overseas or selling interests in Australian industries granted that such borrowings and sales serve the real interests of Australia and its people. Mr C. J. Moffat, of the University of Adelaide, in June 1967 issued a paper on foreign ownership and balance of payment effects on direct investment from abroad. In this paper he states:

Since the rate of growth of locally owned enterprises is substantially less .than the rate of overseas direct investment, the foreign ownership ratios have been increasing steadily and will continue to do so if circumstances remain unchanged.

This, of course, means that the proportion of Australia owned by Australians is becoming less and less, and as more and more foreign investment takes place the rate at which Australia is passing into foreign hands is becoming more and more rapid. Government supporters contend that overseas capital inflow promotes national development and thus is justified. If all the fruits of this development plus some of the fruits of Australian investment go to overseas investors it surely is to that extent undesirable. However, does it promote development? The growth of output per man employed in Australia between 1955 and 1965 was, as I pointed out, 1.8% while in other countries it was much greater. Other countries promote growth more rapidly than Australia without incurring immense debts by selling their resources and enterprises to foreign investors.

The First National City Bank of the United States of America recently made an investigation of the Australian economy. The report states that the gross national product of Australia per capita in 1965, in American dollars, was $1,909; of the United States $3,501; of Sweden $2,497; of Canada $2,452; of Switzerland $2,319; of France $1,907; of New Zealand $1,979; and of Germany $1,902. Let us look closely at this inflow of capital. How does it come here? We are told we get the knowhow from experienced industrialists of other lands. This of course represents a relatively small proportion of the inflow, and much of the so-called knowhow would not bear too close an examination. The major portion of capital comes to Australia in the form of goods. This is the procedure. If an American individual or company wants to buy mining interests in Australia, or any other interests, a representative goes to a branch of an Australian bank in America and deposits the price of his investments, say, for example $lm, in Australia. That bank pays this amount to the person selling the property in Australia. The position then is that the Australian bank has $lm in America while the American has his mining and other interests in Australia and the Australian has his money. The Australian bank makes the $lm in America available to any Australian or Australians who will deposit a similar amount in Australia. The Australian can do what he likes with the money. He can buy manufactured goods such as boots, clothing, furniture and so on, or canned primary products such as fruit, meats and vegetables. He can purchase raw material or things that

Australia cannot produce and which are essential to our development. That is why foreign capital should not be excluded from this country and also why there should be discrimination in the type of capital admitted to this country. Australia should do as Japan and other countries do - admit to this country only such capital as promotes national development. Australia does not merely allow overseas capital to come to this country in any form to take over our national resources, established industries or real estate; it gives foreign investors all kinds of concessions to induce them to take over Australia bit by bit at an increasing rate.

During the last five years the inflow has been about $2,700m. For the five years prior to that it was $ 1,600m and for the preceding five years it was $800m. Our Governments - Commonwealth and State - are continually devising schemes to sell Australia at bargain prices to overseas investors. The Commonwealth Government operates what are called double taxation agreements with the United Kingdom, the United States, Canada and New Zealand. The result of these agreements is that a taxpayer with an annual taxable income of $5,000 living in America or England would pay income tax to Australia of $750, while a resident of Australia with a similar income would pay $1,140. On $10,000 the overseas taxpayer would pay $1,500 and the Australian taxpayer would pay $3,543; on $20,000 the overseas taxpayer would pay $3,000 and the Australian taxpayer would pay $9,465; on $50,000 the overseas taxpayer would pay $7,500 and the Australian taxpayer would pay $29,537; while on $100,000 the overseas taxpayer would pay $15,000 and the Australian taxpayer would pay $63,741. This is only an example of what happens. In 1965-66, ninety-two fully owned foreign companies in Australia had a net profit of $96m. They paid in income tax to Australia less than $15m. Had they been Australian companies the dividends would have paid over $60m. The concessions in taxation granted to overseas investors are not the only advantages that foreign investors receive. For example, ALCOA of Australia Pty Ltd, which is an American firm operating in aluminium, obtained concessions in the cost of electricity for seven years equivalent to $6m a year.

The dividends paid to Australians in Australia are mostly used in the development of this country. As the money passes from hand to hand it is being taxed again and again so as to provide the public services and the defence of this nation. The dividends paid overseas which are taxed at a fragment of the Australian rate are generally lost to this country. The dividends that MacRobertson Pty Ltd now pay are taxed at a rate between 30% and 60% . If that company is taken over by overseas shareholders the tax payable would be only 15% of the dividends. Then the Australian Government will receive less in taxes or it will have to increase taxes upon Australians. That, of course, is inevitable. Either the Government gets less in taxation as a result of these takeovers or it must increase taxation upon Australians in order to compensate for the amount o the concession that it grants to overseas investors. In other words, all of these millions of dollars which are necessary for the defence of this country and for the defence of the right of overseas investors to carry on industries in this country are being paid more and more by resident Australians who as time goes on own less and less of the country in which they are paying taxes.

One of the great difficulties of this country is its continuous and adverse balances of payments. These increase as dividends payable overseas increase and they are added to by the vast number of Australian companies that are prevented from exporting. The payments that Australia receives for the goods that it exports overseas and for the services that it renders overseas are not adequate to meet the amount that is payable overseas for other goods and services. Do the overseas companies that operate in this country help to overcome our balance of payment difficulties? No. They add to the balance of payments difficulties, because hundreds of agreements are operating in this country between subsidiaries of overseas firms and Australian firms which forbid Australian companies exporting goods, which would result in an improvement of our trading position with other nations.

Australia is one of the very few countries in the world that do not implement treaties or legislation to restrict and control the amount and type of capital inflow. The governments of other countries safeguard their national resources and industries for the benefit of the present and future generations of those countries. There has been only one independent and expert investigation of Australian capital inflow and its effects upon the economy of Australia and the welfare of its people. The Menzies Government referred this question, among other matters, to the Vernon committee of inquiry on economic issues. That Committee recommended the restriction of capital inflow. The Government has done nothing about the decisions of the Vernon Committee. Already an immense proportion of the mineral resources of Australia is owned overseas. Nearly 30% of the whole of our industries are owned overseas. Tens of thousands of square miles of Australian territory are controlled from overseas. Will it be to the advantage of Australia and its residents if 40%, 50%, 60% or more of its territory passes into foreign hands? The present Government is emphatic that more and more of Australia should be owned overseas. It sets no limit to foreign ownership. It encourages continued, unrestricted and unregulated capital inflow.

To the extent that private capital is necessary to speed up the development of a country like Australia, it can be obtained in two ways - by the sale of Australia or by loans. Which is preferable? The following extract is from an economic review published by the Commercial Bank of Australia Ltd in June 1967:

Of course, private capital may be raised in two forms - equity (direct and port-folio investment) and fixed term. Fixed term borrowings are less volatile than equity, an advantage which Australia and New Zealand are now appreciating. Japan is an example of a country which has borrowed on fixed terms. Since World War II, the Japanese have preferred to obtain overseas finance in the form of medium term loans. To the extent that this form of financing is obtainable - and it has been for Japan - it is another part of the answer to capital inflow problems. Foreign control would be reduced, yet overseas skill and finance would be available.

If Australia must have foreign investment, why must it be obtained in the worst possible way, that is, by permanently selling Australia to foreign interests and by enabling these interests to use the moneys of Australians to expand their ownership?

An example of this is the borrowing by General Motors-Holden’s Pty Ltd and others from Australians at a fixed rate of interest. Upon this money which is borrowed at 6% to 8%, profit of over 100% is made in some cases for the foreign investors. Surely it must be clear to every Australian that we owe it to those who worked and fought for this country in the past to conserve the natural resources of the country and to bequeath the nation to posterity free of foreign economic and political domination. Why should Australia’s sons be conscripted to fight in foreign countries for their country - a country in which it is becoming ever more difficult for them to secure an interest in a farm, a factory, a mine or any type of industrial enterprise? The demand for an investigation of overseas capital inflow is growing. Such an investigation is essential before the Government gives further concessions to Japanese, German and other investors, which it is now seeking to do.

I suggest that this Government, in the presentation of its Budget, has ignored the most important problem that faces the Australian people, lt ignores what will happen to Australia in the future. It is all very well to export vast quantities of iron ore to Japan so that she can establish in her towns and cities an industrial organisation for the manufacture of steel that will compete with the Australian steel industry in the markets of the world including the market in Australia itself. It is good for other nations that we allow their investors to exploit the natural resources of this country, but we are not serving either the interests of the present generation or the interests of the future generations in succumbing to the invasion of foreign wealth, just as we would not be serving the interests of this country if we permitted or succumbed to military invasion by overseas powers.


– I do not intend to take up much of my time in commenting upon what the honourable member for Scullin (Mr Peters) has said. We must live in two different worlds. There is a modicum of truth in what he said about overseas investment in that we must be careful not to accept overseas investment in companies that are already processing primary products in Australia. Over 97% of the capital that has come into Australia in the last generation for investment in land has been invested in leasehold land. That land will be improved and will eventually be given back to Australia. That figure includes investment by many companies that already had a big stake in this country.

The greatest example of mining investment is Mount Isa, which had four infusions of capital before finally getting off the ground. For every cent that goes out of Australia to overseas shareholders, 6c is paid in taxation, 7c is paid in salaries and wages to Australians, and more than 5c is paid in freight costs and material charges. The honourable member for Scullin mentioned iron ore. We have proven reserves of 15,000 million tons of iron ore of 62% quality or better. Undoubtedly a lot more iron ore could be prospected. In addition there are considerable quantities of lower grade ore and I remind the House that 40% quality is the standard that is treated in many areas of the world. Mining development in the north west of Australia is something that has to be seen to be believed. What has been done at Mount Tom Price, partly but not wholly by overseas capital, is a great example to the world. Anyone who is jealous of the people engaged in this development could be compared to a person who is jealous of the owners of a Melbourne Cup winner, when he did not even go to the yearling sales to bid for the colt.

In my opinion the Budget will encourage incentive, continue the expansion of industry and foster a stable economy, which is the best thing that could be done for the country generally. I am disappointed that there rise in pensions or repatriation benefits but 1 am quite certain that the overall advantages that will come from this Budget will more than compensate for the failure to increase those payments. I feel that the increased allowance for insurance and superannuation payments is an encouragement to people to help themselves. The Budget also provides increased expenditure of $50m on education. I hope that the time is not far distant when we will see a further decentralisation of tertiary education by the establishment of a Riverina university.

We have heard criticism of the alleged neglect of the north of Australia. This is put forward by people who, because a monolithic structure has not been built in bricks or mortar, do not believe progress has been made. Anybody who has knowledge of the north, and I have known it since I was a small boy, will support me when I say that in the last ten years there has been tremendous progress in the north. This has been brought about by giving incentive to people to invest money and to take risks. It has also been brought about by the building of better roads. The first requirement of development anywhere is better communications and a great contribution has been made by this Government under its beef roads scheme and its Commonwealth aid roads legislation. It would be a great mistake to eliminate the provision in the Commonwealth aid roads legislation that at least 40% of the money allocated to the States shall be spent on roads other than highways and main roads, that is to say, rural roads. I have mentioned this before and I stress it again. This is the basis of the tremendous changes that have come about in the last ten years or even less in some areas. It is now possible to sell any type of animal in inland areas, whereas in former years one could sell only aged cattle and then only at the price and at the time the buyer chose. The amount distributed in Commonwealth aid roads grants to the States has doubled in ten years. An amount of $750m is to be distributed in a five-year period which ends in 1969.

Australia is a vast country and there is usually a drought in some part of it. Queensland and north western Australia recently had a drought over a vast area. Happily the position has corrected itself. Now the area I come from is suffering from a shortage of rainfall that will become a drought if we do not get rain in the near future. I would like the question of establishing a drought bond fund reconsidered. This would simply be a replica of the New Zealand scheme. I understand this proposal was raised some two years ago but was rejected on the ground that the war-time deferred maintenance scheme was never utilised to a sufficient degree to make it worthy of support. The idea of drought bonds is that in time of high income money can be invested, say, for a sevenyear period at a favourable but not high rate of interest. If, in the event of drought, redemption is required then an assessment is made. The money put into these bonds is not taxable in the period of high income but is taxable when it ls returned in the time of need.

Another matter I want to raise is one that my friend the honourable member for Mallee (Mr Turnbull) mentioned in an excellent speech a little while ago. I refer to probate. Probate is a severely limiting factor in expansion. It is a terribly limiting factor in production. It is true that in 1948, $40,000 was regarded as necessary for a single farm unit. Whether this figuring were applied to a rural holding, a family company or a family business, that was the estimated cost for a single unit. A comparable unit today would cost $140,000.

The honourable member for Mallee (Mr Turnbull) spoke of inflated values, and I strongly support his remarks. I suggest that serious consideration be given to the implementation of probate duties on a different rating. The present rate on an estate of $40,000 is 10%. This is the total rating, both Federal and State. The rating on an estate of $140,000 is 35%. This means that in every generation 35% of that estate has to be whittled away. In other words, the property has to be sold, with the consequent loss of continuity of effort and experience, or sufficient land has to be sold to meet probate. Possibly only twothirds of the property would remain and, on figures that I have been given, the estate would no longer be economic. We must ensure the continued prosperity of Australia, which is recognised around the world as a land of great prosperity. Every period has its problems and challenges, and these must be met, but we must ensure the security of this country.

For the remainder of my speech I shall discuss the present situation. To assess properly the situation in Asia and in South Vietnam it is as well to examine history. In 1954, when the partitioning of Vietnam took place, nearly one million people came from North Vietnam to South Vietnam - a great many of them for religious reasons - but less than 100,000 went from South Vietnam to North

Vietnam. It is as well to remember - and this is undeniable - that included in the one million people who came from North Vietnam were persons planted in South Vietnam to create difficulties and to cause disturbances when the opportunity arose. Between 1954 and 1958 living standards in North Vietnam declined by 10%, but in South Vietnam they increased by 20%. In 1958 South Vietnam had 400,000 tons of surplus rice - exportable rice. This agitated the minds of the Communists, because it showed which system was working the better. This was one factor that prompted, perhaps sooner than otherwise, the formation of the National Liberation Front in Hanoi in 1960. The war developed progressively until in 1965 almost every city in South Vietnam was under Communist domination as were the highlands and the province of Pleiku. The Communists also controlled Route 19 from Pleiku to the coast. This was part of their strategy. Any suggestion that progress is not being made in this war is not correct. I do not agree entirely with my friend, the honourable member for Mallee, who said that anyone who goes to Vietnam for a few days does not improve his knowledge of what is happening.

Mr Turnbull:

– I did not say that. I said that such a person could not be regarded as an expert.


– I apologise. 1 should have known that the honourable member would not make a statement that could be queried. I was in Vietnam about twelve months ago and I have been told of the current situation by military men and by young soldiers - national servicemen mainly. It is obvious that tremendous progress has been made in that time.

The proposition put forward by the Labor Party is that in an endeavour to bring about negotiations the bombing of North Vietnam should be stopped, the National Liberation Front should be recognised, and an attempt should be made to create a holding war. If this policy were adopted it would strain to breaking point our relationships with all our allies. I think it is fair and proper that the people of Australia and members of this House should note these three points which are continuously put forward, as Hansard will show, by the honourable member for

Yarra (Mr J. F. Cairns), the honourable member for Reid (Mr Uren) and the honourable member for Wills (Mr Bryant). I make no further comment on it than that.

Let me now discuss the bombing of North Vietnam. It is idle to say that bombing has not had an effect. Every time there has been a cessation of bombing or a military truce the Communists have taken the opportunity to re-equip and resupply their forces and to take tactical advantage of the situation. The honourable member for Moreton (Mr Killen) said that 900 craft moved from the 19th parallel to the 17th parallel during the truce of 1st January 1967. In fact, five members of the United States Navy who were here on the USS ‘Canberra’ assured me that over 1,000 craft moved from North Vietnam to South Vietnam on that occasion and that they were loaded to the gunwales with equipment, supplies and, undoubtedly, ammunition.

It was very interesting last Thursday evening to hear the Leader of the Opposition (Mr Whitlam) say that half the senators of the United States were opposed to the escalation of the bombing in Vietnam. I point out that recently the United States Senate voted 85 to 5 in favour of increasing enormously the money to be allotted to the war in Vietnam. The United States Chief of Staff is reported to have said that attacks against North Vietnam were having a marked effect on what was happening in Vietnam. He said that without United States air power in Vietnam more than 800,000 additional American ground troops, costing $A66,960m more than has been spent, would have been required in Vietnam. He said that he agreed with other military leaders that a marked increase in the bombing of targets in North Vietnam had damaged Hanoi severely and had affected its ability to carry the war forward. Bombing exerts great influence and, as the American Chief of Staff said, it is the weapon most likely to force the enemy to reconsider his avowed hard line. Before the bombing commenced, North Vietnam had a battle tested army of 250,000 above the demilitarised zone, with large stocks of supplies. It intended to cut South Vietnam in half and almost did so. The only reason why North Vietnam did not achieve final success in 1965 - although it almost did - was that it was not able to throw this massive land force into the conflict. It was prevented from so doing by American air power. Anyone with an elementary knowledge of military facts, particularly anyone who has had experience of war with and without air support - and I have been in both positions - will know that it is complete and utter nonsense to say that bombing does not have a detrimental effect on the enemy. Whenever we cease bombing we suffer greater casualties and prolong the war.

The main hope that the Communists have of eventual victory rests in holding on. They hope that the South Vietnamese and their allies, but particularly their allies, will lose their will to fight and will withdraw. Without their allies the South Vietnamese would not be able to withstand the might of the North. The only hope the Communists see of victory is the withdrawal of allied forces from South Vietnam. The Communists, not only in South Vietnam but throughout the world, are very adept at using propaganda and twisting facts to suit thier purposes. Therefore, the actions of people in Australia, including university students, will be used to boost the falling morale of Communist forces in South Vietnam. This will undoubtedly delay the termination of the war and lead to the loss of more Australian lives. Communism has been arrested in several parts of the world. There was a very large uprising in Italy. There was turmoil in Greece between 1945 and 1948 when hundreds of thousands of people were killed. There was conflict in Turkey. We know what happened in Malaya. For years the people of Malaya were subject to guerilla terrorism and economically Malaya was brought to its knees. We know what happened in Indonesia. It was almost a miracle that Indonesia did not come under Communist domination. The fact that those who did not believe in the Communist way of life were prepared to show their strength and support for people in South East Asia who were in need of it had a tremendous influence on those in Indonesia who opposed Communism and also caused those who favoured Communism to hesitate.

What is happening in South Vietnam? Progress is being made over quite wide areas. The Revolutionary Development Forces are creating areas of security, aire increasing production and are improving the health of the people. When these areas have enjoyed military security for a certain time, the provincial and regional forces of the South Vietnamese Army move in- to afford some protection. But the feature I find most remarkable is not that the attempt to introduce democracy has had a few setbacks but that, in the midst of a terrible conflict, a genuine effort is being made to bring the processes of democracy into operation. In two world wars, established democracies had to suspend these processes. The people of South Vietnam are to be highly commended on their efforts and they deserve the highest praise and sincere understanding.

In the areas I have described the people who are -elected to be hamlet chiefs and who accept the responsibilities of police and so on are the ones who are subjected to concerted and most malicious terrorism by the Vietcong. It is remarkable that people should offer themselves as candidates for election to these offices with their attendant risks. The evidence of terrorism against them is not hearsay evidence. I rely on evidence from members of our own medical teams in South Vietnam. With other members of the delegation that was in South Vietnam last year, I spoke to our own medical men at Bien Hoa. One of them told me of his experiences and also related them in a series of letters to a friend in Australia, who sought permission to publish them. The doctor told us that when casualties came to the hospital he could tell who had given assistance to the residents of a village by the degree of mutilation that they had suffered. He said that, after the casualties of a Vietcong raid had come to the hospital, he could walk around and say in almost every instance who was a teacher, a hamlet chief, a policeman and a rural worker. These were the people who were subjected to the most terrible and terrifying types of cruelty.

He told us of two or three cases. One was a young girl of 21 years of age. She had been a school teacher. She had obviously been cornered in a building and had her hands up. She had been mutilated by slashing with a cane knife and the top of her head had been taken off. She did not survive. A machine gun had been held to the side of a policeman’s face. He died, of course. But the most horrifying case the doctor described to us was that of a hamlet chief who was murdered. His children and his wife also were murdered. A small boy had his arms and legs cut off. The child was an orphan, the only member of the family to survive, and the only sin he had committed was that he was the son of a hamlet chief. These are true facts.

Mr Kelly:

– The people who acted in this way are the ones who will be helped by the money that is being sent from Australia.


– Yes. The facts I have related were not given by a political propagandist. They were given by a man who went to South Vietnam for six months and who elected to stay for a further six months. He has no particular political beliefs. Yet we are told that the South Vietnamese must negotiate with these people who have been maintaining their control by these horrible methods. We all know that war is barbaric and ghastly. No aspect of war is defensible. But we must help people to defend their way of life against aggression. Some incidents are exaggerated. We do not have any medical teams in the north of Vietnam; they are only in the south at Bien Hoa, Vung Tau and Long Xuyen. However, not one member of our medical teams has seen a case of napalm bombing. These incidents are exaggerated out of all proportion and I am quite satisfied that the greatest care is taken in the use of this weapon.

Warning leaflets are dropped and the Vietcong get hold of them. They will not allow the leaflets to come into the possession of the civilian population, and those that are obtained by civilians are often misunderstood. Care is taken not to interfere with the civilian population and civilians are harmed only by accident. Horrible things happen to civilians in war, but every care is taken to avoid civilian casualties. The military authorities would not defoliate an area along the Saigon River because people were living there. I flew over the area in a helicopter with General Mackay. I said: This must create a hazard to shipping’. He said: ‘Yes, but some people live there; there is a fishing village in that area’. A week later a 17,000-ton vessel was mined and sunk in the river just opposite this spot. We talk about the horrors of war and the dangers to which civilians are exposed. Of course, there are civilian casualties. We do not have much of a record in war to speak about, but this is one of the ghastly aspects of war. Despite this, we must continue to show aggressors that they cannot subject others to control by force and expose them to terror.

The conflict in South Vietnam has far wider implications than the survival of South Vietnam itself. This is understood by most Asians. The Communists have stated their intentions in many Chinese doctrines. I find it remarkable that much of the information about the Vietcong on which reliance is placed is written by and disseminated by a man named Wilfred Graham Birchett During the Korean war, he was a Communist journalist. He interrogated his own fellow Australians under torture. I have termed him an arch traitor, and I do not think there could be a more personal type of treachery than that of a man who would do this to his countrymen. This is the man who provides information about what is happening to the Vietcong. Unfortunately many people, possibly well-intentioned people, accept his distorted viewpoint and put it forward in a genuine effort to procure peace. They do not realise that, in doing this, they are giving hope, restoring confidence and encouraging the stamina of our enemies and are subjecting our young people to great disappointment and despair.


– This Federal Budget must rank as one of the most inequitable ever introduced into the Parliament. It is inequitable because of its harsh discrimination and its unfairness. It blatantly discriminates against the lower income groups and the needy, which include the wage earner, the small farmer, the small businessman and the pensioner, whilst lavishing favours on the rich section of the community, on those whose needs are least. It discriminates against the education of our children and the needs of the sick and helpless. If anyone wants proof of this contention let him look at the ever-growing magnificence of multi-storey insurance company buildings, the buildings of the banks and hire purchase firms and the city buildings of the giant foreign mineral companies and contrast them with the unbelievable shabbiness of our hospitals, our schools and those benevolent institutions which are trying to help the aged and the sick. Its callous treatment of the age pensioner can only be regarded as inhuman and cruel, particularly when viewed in the light of the extravagance and waste associated with the maladministration of defence spending, the uncontrolled escalation of costs of imported defence equipment and the gross underestimating with regard to unnecessary and luxurious ministerial VIP aircraft.

The Budget, as was clearly endorsed by the statement made by the Treasurer (Mr McMahon), is one for the rich man, the rich farmer and the large company. It is a budget which welcomes with open arms the inflow of foreign capital to control even more the best of our national assets of land and minerals in a country which, incidentally, is supposed to belong to Australians. Is this really a surprising Budget? No. Why should it be? This is a Budget expressly incorporating the financial and economic policies of the Liberal and Country Parties, ramrodded by an unsympathetic Liberal Party Treasurer who once and for all has firmly illustrated how little he and his Government really care for the low income groups of this country and how much they care for the powerful and influential moneyed interests.

I propose to deal now with some of the glaring omissions from the Budget. The Treasurer’s statement that he had drawn the reins on public spending is a gross understatement and is a damning indictment of the Government’s attitude to its responsibilities. It has drawn very tightly the reins on social services, education, health, Aboriginal welfare and national development, but in contrast it has no reins on the extravagant spending and waste on defence materials and VIP aircraft. The Government’s lamentable past record in national development and its refusal to face up to development problems, which are illustrated again in this Budget, must rank among the greatest of all this Government’s failures during its seventeen years in office.

The most glaring omission in the Budget in the development field is the complete absence of any funds for water conservation, despite the grandstanding and unqualified promises made by the Prime Minister (Mr Harold Holt) in his election policy speech last November for the provision of $50m for water conservation. The attempts by the Prime Minister and the Minister for National Development (Mr Fairbairn) to cover up for the omission of water conservation funds from this Budget are pathetic. Their remarks will receive no sympathy in those rural electorates which for years have been appealing for water conservation. There is no excuse for its failure to proceed immediately with water conservation projects in Queensland and Western Australia because these projects have been languishing for years waiting for the Government to do something positive. To maintain that there are no projects ready for immediate work, as was intimated last year by the Minister for National Development, is nonsense.

The motive behind the omission of water conservation funds from the Budget is now becoming clearer. The Government either has no intention to provide Federal funds for water this financial year or else it is embarking on a deliberate move to delay an announcement until some future date. But not even this Government with its growing arrogance can afford to go back on its serious election promise last November because the Australian people will not stand for blatant hypocrisy of this sort. Too many people have been financially hurt by devastating droughts; too many people will continue to be hurt in future years unless positive action is taken; and too many people are beginning to realise that, as regards important areas of Australia, if this generation does not conserve its water the next generation will have to do so for its very economic survival. The reason for this glaring omission is political. Because water conservation is a dynamic regional and national issue and is of vital importance to the States, particularly the politically sensitive State of Queensland, the Government is deliberately delaying an announcement with the express objective of influencing the forthcoming Senate election and in Queensland the Capricornia by-election. A government which is prepared to gamble irresponsibly for political reasons with the economic lives of people whose livelihood has been devastated by droughts and floods does so at its own risk.

In Queensland, projects in the Burnett, Fitzroy, Pioneer and Burdekin basins have been waiting for the green light to go ahead for years. The Nogoa project, for example, has been the subject of delaying tactics by the Commonwealth for three years. If the Government follows the same tactics in the Capricornia by-elecetion as it adopted in the Dawson by-election we can expect a favourable announcement on the Nogoa project very shortly. The Kolan-Burnett scheme is sound. It is vital to the stability of sugar production and the establishment of essential secondary industry. The harnessing of the water resources of the Burdekin and Fitzroy basins is the key to the development of the enormous potential of their land, water and mineral resources. But what has the Government done about the development of this region in which the catchment area of these two rivers alone is far greater than the total area of Victoria? This is what the Government has done: In 1949, in his election policy speech, the Leader of the Country Party, Arthur Fadden, gave an unqualified promise to the people of Queensland that, if elected, the Country Party would proceed with the Burdekin scheme without delay and would not pigeonhole the project. Such a statement is a classic example of the negative attitude which the Government, and the Country Party in particular, has taken towards water conservation in the northern areas of Australia.

For thirty years projects in the Burdekin and Fitzroy basins have been investigated and reinvestigated. Although numerous glowing technical and economic reports have been produced, primary producers continue to go bankrupt with each devastating drought and the general economy of the rural towns remains stagnant. Water conservation for power, irrigation and stock is the most powerful impetus required to galvanise into life this sleeping FitzroyBurdekin giant with its enormous natural resources of land, water and minerals. A dam on the Burdekin will impound sixteen times as much water as is contained in Sydney Harbour and yet water in relation to the soils commandable by this water is by far the limiting resource.

The magnitude of the water resources of mis region illustrates the enormity of the wastage of the millions of acre feet of water flowing into the sea each year. This wastage is highlighted even more by the indisputable and unpalatable evidence that the area contained in the Burnett, Fitzroy, Pioneer and

Burdekin basins in the last four major droughts during the past twenty years has suffered the greatest cumulative total loss in the value of production of any area in Australia. This has been a great loss to the nation because this area is also one of tbmost important export producing areas of the Commonwealth.

The discrimination against central and north Queensland is discrimination against the people and the State of Queensland. This course is to be expected because this pattern of discrimination against Queensland has been a policy of the Commonwealth year after year, with the possible exception of the 1961-63 period which was the direct aftermath of the election debacle in Queensland where the people of Queensland almost threw this Government out of office. Queensland has the strongest claims of all Australian States for Federal developments funds. Firstly it has the greatest scope under known technology for the large scale development of export earning primary products based on undeveloped land and water resources in its higher rainfall areas. Secondly, the State has consistently been discriminated against in its claim for Commonwealth funds for health, education, transport and development. Despite its great scope for development based on water in the proven and established areas, Queensland has never received lc of the $900m of Federal funds made available to the States for water conservation for power, irrigation and flood mitigation. Thirdly, Queensland in the last ten years has earned for the nation an export surplus of overseas income of $3, 150m which, with the export surplus of Western Australia of $l,350m, has been used to finance the imports and huge overseas trading deficits of New South Wales and Victoria which have amounted to $4, 800m in this period.

The Government talks glibly about decentralisation and the development of basie industries in the northern areas in order to take advantage of raw materials, but this type of thinking is, under present conditions, nonsense where there is a wholesale shortage of power. It is useless to talk about iron and steel mills, chemical and fertiliser industries, aluminium smelters or large scale processing works unless the power crisis is solved. Queensland, although possessing enormous reserves of bauxite, has lost the aluminium smelter to the southern States because the State could not provide ample power in central and northern Queensland, despite the tremendous resources of water and coal and the existence of good deep water ports.

The greatest resource deficiency in Australia is our lack of people. The need foi more people should underlie every decision taken on public investment in development projects. Nobody could dispute the fact that the north possesses the basic resources for generating large population increases. I shall keep to the Fitzroy and Burdekin basins to illustrate my point rather than skate over the vast area of northern Australia. The primary industry potential, based on beef, sorghums, wheat, wool, cotton, long grain rice, maize and efficient dairy production, is very high. Reserves of soft and hard coking coals are in the vicinity of 30,000 million tons. The exploitation of these vast reserves must not be confined to the wild race to ship coal overseas; it must make provision for the establishment of basic iron and steel works, utilising, if necessary, the iron ore of the Pilbara if known Queensland deposits are not of an acceptable grade for economic operation.

More than 100 million tons of limestone are located in the Caves area near Rockhampton as well as almost unlimited quantities of salt at Bajool. Limestone and salt are essential materials for deriving soda ash, which in turn is a basic requirement for the conversion of bauxite into alumina. The mounting reserves of pyrites at Mount Morgan can be used for the production of sulphuric acid and fertiliser. Similarly, the vast bituminous coal reserves are basic raw materials for the carbide, plastics and textile industries.

But fundamental to any such development is power and water. The Labor Party’s policy on northern development is well known. It is specific. There is a policy and this is the only political party which has a policy on northern development. As regards the Fitzroy and Burdekin basins, the utilisation of the Snowy Mountains Hydro-electric Authority, in conjunction with State water conservation personnel, is the backbone of Labor’s policy. We want the proud flags of the Snowy Mountains Authority to be preserved and to fly over this northern region. Unfortunately, if the present Government stays in office much longer the Snowy Mountains Authority will exist in name only. This Government’s deliberate policy of abandonment of this organisation will be a black mark against Australian development for many generations to come.

The financing of such development will be done by orthodox means. There is no need to say that the extravagant wastage associated with this Government’s administration of the nation would be severely curtailed. I have no hesitation in saying that a greater burden of taxation would fall on those companies which are exploiting Australian natural resources and returning very little to the areas in which this exploitation is occurring. For example, despite the existence of the multi-million dollar projects at Weipa, the local authority shire in which this giant foreign owned project is located is the poorest in Australia. Even basic roads are non-existent A similar situation exists at Moura, where the output of coal to Japan is valued at millions of dollars per annum. The roads in the Banana Shire are among the worst in Australia. The shire is starved for large scale power. The local authorities are desperate for money to provide even basic facilities, and yet in their own backyard they have one of the richest coalmines in Australia.

I tell the House here and now that a Labor government would make it mandatory that a proportion of the spoils of these companies remain in the area for local authorities to provide for fundamental development in roads, water and power. The Mount Isa company has significantly contributed to the development and to the people of Mount Isa, Townsville and northern Queensland in general. The Mount Isa company has done this voluntarily and I give credit to a progressive management which is not only interested in amassing profits for its overseas investors but also has in mind the welfare of the people of north Queensland and the development of the area.

The main means of financing development by a Labor government will be through a development revolving fund utilising the revenue flowing back to the Federal Treasury from existing development prejects. These payments are conveniently forgotten by the Treasurer and his Government when putting forward excuses as to why funds are not available. In this financial year income received by the Commonwealth from the Snowy Mountains scheme will be $22m. This level of income and repayment to the Treasury will rise substantially in the future. This money will be deliberately earmarked by a Labor government for water conservation. A Labor government’s policy of utilising repayments made by the States to the Commonwealth for future development projects by means of a development revolving fund would immediately expose the money lending, profiteering policies of this Government, which are almost in the same category as the profiteering rackets of back alley city money lenders.

Let me take Queensland to illustrate my point The Commonwealth consistently claims that it financed reconstruction of the Mount Isa railway. Technically it did, but the Government in fact promoted with Queensland the toughest financial deal for any development project in any State in the Commonwealth since Federation. A total of $34m was loaned to Queensland at such a high rate of interest that a total of $57m has to be repaid - $23m in interest. This repayment to the Commonwealth will be earmarked for the development revolving fund.

The Government tries to take great credit for its financing of the Brigalow project. Look at the facts of this financing. The payment of interest on loans of $9m advanced to Queensland to date amounts to $4.8m. Interest on loans by the Commonwealth of $8.5m for beef roads up to 30th June 1967 amounts to $4.1m. Let me take one example in Western Australia.

Mr Giles:

– What about the position in South Australia?


– I will come to South Australia in a moment. The payment of interest by the West Australian Government on loans to date by the Commonwealth of $34m for the rail standardisation project between Kalgoorlie and Kwinana amounts to $43m. The honourable member for Angas (Mr Giles) has asked about the situation in South Australia. The payment of interest by the South Australian Government in respect of loans to date of $9m for rail standardisation amounts to $ 11.7m. Repayments by a State for Commonwealth financed development projects which would form the backbone of a development revolving fund are very substantial. In fact the total revenue received by or owing to the Commonwealth for interest payments alone in connection with eighteen development projects amounts to S121m. This does not include revenues from the Snowy Mountains Authority.

I should say a few words about sugar. In this Budget the Government has made provision for the payment of a further $10m to Queensland to enable assistance to be made available to the sugar industry in marketing the 1967 crop. The amounts are repayable in future years. I was amazed yesterday to hear the Treasurer imply that the omission or inclusion of No. 2 Pool sugar under the Si Om loan scheme is entirely a matter for the Queensland Government and is of no concern to the Commonwealth. The Commonwealth has of course passed the buck to the State Government. This was not the explanation given last year. The omission of No. 2 Pool sugar with respect to last year’s loan was a blatant act of discrimination against those areas and farmers producing No. 2 Pool sugar. The Commonwealth has to bear the blame for what has happened. All production should be of concern to this Government, regardless of whether it relates to No. 1 Pool sugar or to No. 2 Pool sugar. There is no technical or other reason why a scale of differential payments could not be inaugurated to give those farmers who produce No. 2 Pool sugar some part of this additional finance, even if this would slightly reduce the average price of No. 1 Pool sugar.

The Commonwealth Government’s decision to provide this additional $10m interest-bearing loan to cane growers and millers on top of the $19m loan made last year has been lauded by the Queensland Premier. It is significant that he is to retire this year. I wonder whether he will suffer any pangs of political conscience when cane growers have to repay this loan with interest, particularly if sugar prices remain low. This kind of ad hoc temporary financing by interest-bearing loans to farmers who, because of their serious financial situation, are not in a position to refuse the loans, is fundamentally bad when it is not part of some overall scheme.

This Government has been saying for two years now that an international sugar agreement is imminent. Early this year, the Minister for the Interior (Mr Anthony), speaking at the annual meeting of the Queensland Cane Growers Council, proclaimed that a new international sugar agreement could come into force by the end of this year. But, according to international authorities who have their fingers on the pulse of international sugar trading, particularly with respect to Cuba and the South American countries, we are no closer to a new international agreement than we were two years ago. Furthermore, Australia jumped from fifth place to second place as a world exporter of sugar following the expansion of our sugar industry, and it is claimed that underdeveloped and so called developing countries have little sympathy for us.

It must be obvious to all that the $10m loan should really be part and parcel of a stabilisation scheme designed to support the export price of sugar traded on the residual free market. What, for example, would be the position of cane farmers if export prices did not rise in the next three years and the Government continued its policy of providing interest-bearing loans that few farmers would have the slightest capacity to repay unless export prices rose substantially? It is high time the Government stopped stalling in the hope that the export price will rise. It has been doing this for two years and this attitude has in turn generated uncertainty, lack of confidence and hardship throughout the sugar industry.

It must be obvious to everyone that if a new international sugar agreement cannot be negotiated, the only solution for the sugar industry is either a bilateral agreement with Japan or a stabilisation scheme. The industry is disposing of 70% of its total exports on the world sugar market which, because of its smallness, is one of the world’s most notoriously unstable markets. Four years ago, prices for sugar on the residual free market reached more than $200 a ton. Twelve months ago, they had dropped to less than $30 a ton - the lowest real price for fifty years. Today, the price is S40 a ton. A fair price compared to cost of production would be $80 a ton. The chances of a bilateral agreement with Japan depend on our ability to bargain with that country. It is certain that if we obtain a bilateral agreement for sugar, some other industry in Australia will suffer. Horse trading is quite common in international arrangements, particularly where tariff levels are involved. Japan is a tough bargainer. That country did not ask us to expand our production, and it would be perfectly within its rights in asking why we did not try to obtain a bilateral agreement for a firm minimum floor price when the Commonwealth and Queensland Governments committed the sugar industry to the spending of approximately $200m on fixed capital for the expansion of the industry from a peak of 1.3 million tons to more than 2 million tons.

Any primary industry that has to sell a large proportion of its production on world markets is vulnerable to violent changes in export prices and producers’ incomes. The wool industry is a case in point. Today, producers in this industry are in a perilous position. This applies particularly to the small growers, who, despite a high level of efficiency, in terms of net income per acre may be on the bread line because their gross incomes are insufficient. It is imperative that the Government realise that price stabilisation for the sugar industry and the wool industry represents the only safe way of protecting producers, particularly the small ones. No longer can this Government afford to adopt policies that provide super tariffs for secondary industries that supply basic materials for primary industries, which provide our exports, and at the same time expect those primary industries to sell their products on an unprotected, cut throat world market.

The spectacle of Sir William Gunn stomping the country as he did when trying to sell the wool reserve price scheme must never be repeated. I believe that the efforts of the Minister for Primary Industry (Mr Adermann) in obtaining a win in Cabinet on that scheme, which, of course, epitomised the policy of the Australian Labor Party, represented perhaps the greatest achievement in his long political career. I hope that before he retires he will see an effective wool reserve price scheme in operation. I hope that he will see in operation also a sugar stabilisation scheme, because, like the wool industry, the sugar industry is highly vulnerable. The Commonwealth Government, having endorsed the decision of the Queensland Government to expand the sugar industry, must face up to its responsibilities. It must implement without delay a sugar stabilisation scheme to protect the small growers, even if this means offending the large proprietary milling interests and the Colonial Sugar Refining Co. Ltd.

This is a Budget for the affluent. It is aimed deliberately at benefiting a favoured section of the nation, and this fact characterises the contempt that the present LiberalAustralian Country Party Government has for the ordinary wage earner, the ordinary farmer, the ordinary business man and the ordinary pensioner. Throughout this Budget, the Government arrogantly penalises those unfortunate people who have to rely on fixed pensions and the goodwill of the Government. Other items of expenditure incurred by this Government have been the subject of unparalleled extravagance. This clearly demonstrates how remote the Government is from the ordinary Australian. During the parliamentary recess of the last few months, we witnessed the greatest exodus of Ministers from this country that has ever been seen, with numerous Ministers departing on world jaunts, many with their wives and most with their staffs. All this was done at the taxpayers* expense. All these tours, with very rare exceptions, were a waste of the taxpayers’ money.

Mr Dobie:

– The Leader of the Opposition also went overseas.


– The Leader of the Opposition (Mr Whitlam) did not waste the taxpayers’ money. The Ministers of this Government have a responsibility to the nation. They should have been in Australia administering their departments and looking after the wellbeing of the nation. Had they done this, they would have been doing the precise job for which the Australian people gave them a mandate less than twelve months ago. So arrogant is this Government, so imbued is it with its own power, that it firmly believes that it is invincible and can do no wrong in the eyes of the Australian people. It can afford to order luxurious VIP aircraft at a cost of $10m, this figure suddenly jumping to $21m; yet it maintains that it cannot afford to provide funds to enable an age pensioner to buy even an additional loaf of bread. For this, the Government deserves the contempt of every decent Australian.

Mr Fairbairn:

– What aircraft did the honourable member use to travel about the north?


– I went with the Minister. The Treasurer of one of the richest and most affluent countries in the world lauds his Government for achieving a high rate of economic growth which, incidentally, is due mainly to vastly improved seasonal conditions and mineral development, and condones the action of foreign interests that are gaining more and more of our national assets. But he refuses point blank to help those who are poverty stricken and needy. For this, he deserves the contempt of the Australian people.


– I rise with a feeling of envy, Mr Deputy Speaker, because I have not bad the good fortune to travel in a VIP aircraft around or over my electorate, but this I would like to do. I suggest that the subject of these aircraft is one we would not have expected the honourable member for Dawson (Dr Patterson) to raise, because he is one of the few private members of this House who have had occasion to use the VIP aircraft. I would also suggest to him that next time he goes north he visit the town of Gladstone. I realise that Gladstone is not in his electorate but is in the electorate of Capricornia, and I suggest that the people of Capricornia will show on 30th September that they realise that the development of the Gladstone area is a direct result not only of the drive of the people of the district, where I was once a constituent, but also of the great encouragement which has come from the policies of the Holt Government and also from Mr David Fairbairn, our Minister for National Development, who I am pleased to see is in the House at the present time.

Despite the examination of the Budget carried out by the honourable member for Dawson and his vain attempt to denigrate the proven record of this Parliament over the past eighteen years, a record of progress in the northern parts of Australia, I congratulate the Treasurer (Mr McMahon) on a Budget speech which has brought a sure economic understanding of the problems that face Australia today. It is heartening to find a Budget which has clearly stated the firm responsibilities that this Government has assumed and the determination of the Government to ensure that the welfare of the whole nation remains its constant care and responsibility. There were, of course, points of disappointment in the Budget for all of us, particularly with regard to age and invalid pensioners. But it should not escape notice that income tax for hundreds of thousands will be reduced while, at the same time, additional benefits from increased child endowment and increased Commonwealth expenditure on education of some 35% - to mention just two of the benefits - have been provided. As the Press has been quick to comment, this is a Budget for the family man.

The Leader of the Opposition (Mr Whitlam) summed up the Budget rather well when he said on Tuesday night, as reported in Hansard:

This Budget illustrates clearly the difference in the sense of priorities between us.

Indeed it does. It shows that the LiberalCountry Party coalition has grappled with the problems of maintaining progress and stability, a job that it has done well throughout the past 18 years. It shows that the Government, under the leadership of the Prime Minister (Mr Harold Holt), has a keen regard for, and has given a higher priority to, employment opportunities for not only native-born Australians but also for the vast numbers of migrants, amongst whom I am proud to include myself, who continue to come to our country not just because of the good weather but because of the opportunities that Australia offers now and for the future, and who bring with them their strength, their cultures, their intellects and their hands to develop this country. In this connection I may say that our priorities are different from those of the honourable member for Hunter (Mr James) and certain of his colleagues who have offered criticisms of our migrant population.

The Budget also shows that we are not given to extravagance of statement or pandering to sectional interests; our concern is for the total development of the country.

It shows that we give a high priority to making only those election promises which we know we can keep, and it also shows that we can and will take fiscal steps to see that Australia’s progress is for the benefit of the greatest possible number.

Yes, Mr Deputy Speaker, the Leader o! the Opposition was very close to the truth when he said last Tuesday night that the difference between the Federal Government and the Labor Opposition is one of priorities. I would strongly urge the Federal Executive of the Australian Labor Party to reconsider very quickly its attitude to these priorities if it ever wants to gain the confidence of the Australian electorate.

I have heard many comments from the Opposition benches in the last 2 days regarding age pensions. There would not be one member of this House who is not constantly brought face to face with the problems of pensioners. This should never be forgotten, and I do express my own disappointment that there has been no increase in the level of pensions. But I throw right back at the Opposition its delaying tactics in another place in holding the Government back from carrying out its declared policy of extending the very successful and very welcome aged persons homes scheme. What are the real reasons for members of the Opposition taking this stand? What is their sense of priority here? Would they have us believe that the Cronulla Labor and Working Man’s Club opened so recently by the Leader of the Opposition and a bevy of Labor members in Sydney is more important than the old people’s homes that could be established with the money that is going into this most luxurious of poker machine financed clubs in my electorate? Would those people who know that trade union organisations already have the right to make application under the aged persons homes scheme have substituted a system of homes for aged members and friends? The facts do not suggest that they would.

Yet, Mr Deputy Speaker, the people who were at the opening of this club are the ones who have delayed the legislation which we brought down to help the pensioners solve their greatest problem and secure the. right to live in good surroundings without worrying about their next meal and without a dread that this winter may be their last if they are not properly housed. Opposition members should indeed reconsider their order of priorities. As a starter, let me suggest that Opposition members stop playing at politics and get on with the job of working at the politics of this country. I continue to suspect that members opposite do not know whether to look over their left or right shoulder to see where their leadership is taking them.

How strange it was to hear honourable members opposite say that there is too much talk of foreign affairs in this Budget debate. Let us clearly indicate that our foreign policy cannot be separated from our defence policy. As this country is one of the most important traders in the world, with an economy that is geared to international trading, there must be a close and active correlation between the Budget and our foreign policies. If members of the Labor Party, whether in this House or in influential places elsewhere, cannot grasp this fact, then may Heaven help us if ever the Labor Party’s present policy makers, whoever they may be, form a government of this country.

We must necessarily consider our future well-being and progress in the context of the Budget, our defence policy, our policy on foreign affairs and our international trade policy. Let Labor work out its policies here, and let Labor say whether it wants Australia to continue as an international trader without accepting the attached international responsibilities. Let Labor members beware of the danger of thinking that we can progress without looking overseas and without taking due care of internal values and stability. But, Mr Deputy Speaker, I do not intend to say more than this on our international responsibility at the present time. The positive policy of the LiberalCountry Party Government is well known and accepted.

Sitting suspended from 5.54 to 8 p.m.


Mr Speaker, you will recall that before the suspension of the sitting for dinner I had called upon the Leader of the Opposition to work out his order of priorities if his Party was to assume the role of an alternative government in Australia. I had asked the Leader of the Opposition to determine whether he thought it was more important to open the Cronulla Labor and Working Man’s Club - a luxurious club financed by poker machines - than to assist in passing the Aged Persons Homes Bill to allow for the extension of a very successful scheme. The Government had promised the electorate such legislation and it had tried and was again trying to get it through both houses of the Parliament. The Leader of the Opposition saw fit to comment that it was a matter of priorities which separated our political philosophies. We would certainly accept any challenge on that score. The oft repeated criticism concerning lack of assistance for age pensioners would have real validity if only the party opposite were prepared to carry through this sympathy, which I share, to support of the Aged Persons Homes Bill, and to do so sincerely and without political overtones.

Let me turn to another comment in the speech of the Leader of the Opposition. How strange it was to hear him say:

The Department of Trade and Industry has chosen to identify itself more than any other with the political philosophy of its Minister.

He went on to say: it is something of an understatement to say that it is a highly political department.

What is the Leader of the Opposition getting at? Can he possibly be serious? It is incredible that he should publicly speak such balderdash. This certainly could not be called a lesson in industrial relations. What is good for the gander may not be good for the goose, but whether the honourable member for Dawson (Dr Patterson) is the goose or the gander in this context I would not care to say. Even if the honourable member’s experience of political involvement or political attitudes gave the Leader of the Opposition cause to consider the politicking that might take place, let me remind honourable members opposite that I speak for the overwhelming majority of professional public servants, who remain very loyal to their professionalism and do not allow their personal political persuasion to influence their vital task of administration in any contrary way. I wonder how the officers of the Department of Trade and Industry view the fork-tongued remarks of the man who may be the alternative Prime Minister. He says that it is all right for a former public servant to win a by-election in Queensland. That is professional honesty. But if a person works for a department, it seems that he cannot be trusted to perform a professional task with due honesty and sincerity.

If the comments I have quoted concerned only the Department of Trade and Industry it would be serious enough, but the honourable gentleman has qualified his remarks by claiming that the officers of the Department have identified themselves with their Minister more than any other officers. It is a matter of degree. The remark would be somewhat amusing if it were not so sinister in its implications. What would the honourable gentleman expect of public servants if he were ever to lead the country? Let him choose his words more carefully in future and have a greater awareness of the true situation. I and my colleagues on this side of the House have the greatest respect for the professional integrity of the Commonwealth Public Service. I can assure the Leader of the Opposition and his colleagues that irrespective of his remarks and his attitudes he will have the loyalty and dedication that has been shown to us, and will continue to be shown for the many years that we will be in office.

Not only has the Budget shown a crying need for the Opposition to establish a proper sense of priorities but also it has shown the need for the Opposition to re-examine its ability and capacity to govern this country. We can accept with some bemusement the cynical remarks of the honourable member for Yarra (Dr J. F. Cairns). He made insidious comments about his fellow Socialist politicians in the United Kingdom and, by inference, about all his parliamentary colleagues. Let the Opposition beware. It should be careful not to doubt the professionalism of the public servants of this country. I believe that not all of them want to become politicians. I glady commend the Budget to the people of Australia as the harbinger of a continuation of the great progress that has made us the envy of the world.


– At least it can be said for the honourable member for Hughes (Mr Dobie) that he is one of the few Government members who have devoted their remarks to the Budget. Most of the members who have spoken from the other side of the House have confined their remarks to external affairs. An opportunity was presented to the Parliament only a few days ago to discuss this subject and honourable members opposite were then afforded an opportunity to speak on the Government’s policy in relation to foreign affairs. However, Government supporters generally have chosen to devote their remarks during this important Budget debate to matters outside this country. I suppose it can be said that there is good reason why they have adopted this attitude. If one carefully considers the Budget it can be seen at once that there is in it very little to which they could devote their attention.

During the course of his speech, the honourable member for Hughes said that he was one member from the other side of the House who was disappointed that the Government had not seen fit to grant some increase to age pensioners and other persons who benefit under the Social Services Act. Let me assure the honourable member that next week when the social services legislation is before the House, he will have the opportunity to support an amendment that will be moved by the Opposition. If the honourable member believes that pensioners should have received an increase - I am sure, from the tenor of his remarks, that he agrees with Opposition members - then he must also agree that the Government should have provided in this Budget some relief for the age, invalid and other pensioners in this country. The honourable member will have an opportunity next week to demonstrate his feelings in this respect.

The Opposition’s main charges against this Budget are that it has sacrificed development for defence and that it is highly discriminatory. The Treasurer (Mr McMahon) stated the essence of his Budget early in his speech when he said that to a considerable extent the shape of the Budget was predetermined by past commitments and by such necessities as defence. Never in peacetime has a Budget been so constrained by defence expenditure and by past commitments. Judged on the Treasurer’s terms, the Budget is not lacking in economic finesse. The boom in Government spending, particularly for defence commitments, has given the Treasurer very little flexibility. The Opposition is radically opposed to the Treasurer on almost every economic issue in this Budget. However, we acknowledge that he has framed his Budget to avoid increases in direct taxation. I believe the Treasurer is plainly dissatisfied with the scope he has been given to employ budgetary tactics. This dissatisfaction is manifest in every comment he makes on defence expenditure. There can be no optimism about the future course of defence expenditure after the Treasurer’s dire remarks. He says that we cannot continue to meet anything like the rate of increase of recent years without deep impairment of the economy. Is there any indication that the escalation of defence expenditure will be less than it has been the past few years? The estimate for defence in the Budget is $1,1 18m, which is an increase of 18% over the allocation for the financial year 1966- 67. It should be remembered that last year’s estimate was $ 1,000m. The actual expenditure was some $S0m below the estimate. But this is not a saving. Rather it resulted from deferment of deliveries. These costs will still have to be met. If anything, the Treasurer’s estimate for expenditure this year appears to be the minimum rather than the maximum.

We have seen from recent evidence before the Public Accounts Committee how these estimates are assessed. A high officer of the Department of the Air, when referring to the estimate of payments for the Fill aircraft, said that the Department had taken a chance and so had reduced its estimates. If this ‘taking a chance’ attitude towards estimation of defence expenditure prevails through all the Service Departments, we are likely to find that the estimate of $1,1 18m will be substantially exceeded before the end of the financial year. It must also be remembered that the Government has deferred urgent defence purchases and renovations. The purchase of the Redeye missile, for example, and the General Sheridan tank has been postponed. The Navy has also deferred the modernisation of two destroyers and a costly refit of the aircraft carrier HMAS ‘Melbourne’. With this costly expenditure ahead and costs of the Fill constantly increasing, there is no sign that the rate of escalation of defence spending will taper off in the next few years. This can only induce the impairment of the economy referred to by the Treasurer.

Earlier this week the Opposition expressed its concern at the escalation of defence expenditure. Our criticism may not have been particularly original. This subject had been dealt with before in this chamber. But we feel that the criticism was at least reasoned and justified. It deserved a coherent and logical answer from the Defence Ministers. But all that we gol was a barrage of fulsome praise of the equipment that the Government has purchased and has under order overseas, Tonight the Minister for the Army (Mr Malcolm Fraser) no doubt will enter this debate.

But in the debate earlier this week the Minister for Defence (Mr Fairhall) its reply was reduced to the absurd level of quoting a publicity handout from General Dynamics, the manufacturer of the Fill. This is hardly the source from which to expect a balanced assessment of the costs and merits of the aircraft. The Minister gave us public relations mumbo-jumbo about the Fill being ‘a super battlebird, the greatest thing with wings since angels’ - and I am now quoting the Minister for Defence - and being able to sniff out targets like a thirsty vampire. The Fill was also described as the ‘Cadillac of the Air*. Surely this is no answer to the grave public concern in Australia about the unbridled costs of this aircraft. This is the kind of answer honourable members on this side of the House received from the Minister for Defence earlier this week in answer to the charges levelled at his Department. The Minister did himself an injustice in quoting this drivel in rebuttal of serious charges.

We appreciate that the Fill and the DDG destroyer are weapon systems, and as the Minister pointed out, the machine tends to be the less costly part of the system. We appreciate also the difficulty of assessing tens of thousands of items of spares and that these complex weapon systems are new areas of experience for the Australian Services. In the light of these difficulties, waste and mistakes are inevitable. But we feel that our attack was not irresponsible nor was it unreasonable. We believe that allowing for these technological problems there is sufficient evidence of gross mismanagement in defence expenditure.

The Opposition feels that there are many reasons for concern about the Armed Services today. We say that evidence of the destruction of documents, as elicited by the ‘Voyager’ Royal Commission, has revealed a disturbing situation in the Department of the Navy. The Minister for the Navy (Mr Chipp) cannot be held accountable for what occurred in his Department before his appointment, but it reinforces the uneasiness that the Opposition feels about defence administration and expenditure in this country. Despite the obvious concern of the Treasurer, is there any evidence that the Government has any plans to control constantly increasing defence costs? A harder accounting approach must be adopted by the Government towards defence expenditure.

The Minister for Defence has indicated that he has considered some rationalisation of defence administration in the light of the Canadian amalgamation of the Armed Services. I am not suggesting at this stage that the Canadian innovation would be practical in Australia. It would have to be subjected to very careful scrutiny. But it could well be that integration on the Canadian lines is most efficient and rational for a minor military power such as Australia. In addition, I believe that there are ways of achieving short term economies by rationalisation of many aspects of defence administration. For example, during the past three years the British Government has been making a substantial examination of ways of rationalising the administration of the Services. It has already made considerable progress in this direction. I suggest to the Government that a similar rationalisation in Australia is warranted. Surely some steps could be taken to amalgamate areas of administration where costly duplication exists. It is pointless for equivalent facilities to be duplicated in the three Services. One facility could be allotted to an individual service to handle for the three Services. This has been done with a considerable degree of success in Britain in areas such as small arms, accommodation of stores, food and motor transport. There must be ways of rationalising the provision of medical and educational facilities and of integrating communication networks among the Services. These are some of the areas in which the Government should be examining ways of rationalising facilities and achieving some savings in costs and manpower.

Previous speakers for the Opposition have expressed concern about the high level of public spending disclosed in the Budget. The Treasurer disclosed an alarming rate of expansion in the public sector. He said that in the four years from 1962-63 to 1966-67 public authority spending as a proportion of total spending had grown from 19% to 21%.

In the past two years 44% of the increase in employment has gone to the public sector compared with from 25% to 30% a few years back. This is an alarming drift of resources away from the productive sector of the economy. Expansion of employment in Australia is clearly occurring in the wrong sector. The trend away from the productive areas of the economy is an alarming one which must impair the efficiency of economic management in this country. With this huge growth of the public sector there is an urgent need to plan future trends in the allocation of resources and particularly the direction of employment. There is considerable evidence that too much of our resources is flowing into unproductive service areas, which are frills on the economy. The Treasurer puts this question in his own fashion at the end of his speech when he asks: ‘Is management everywhere doing the job national greatness demands?’ The Government’s lack of control over public sector spending is not the sort of management that the honourable gentleman envisages when he speaks of national greatness. There are too many examples of flagrant and unjustifiable extravagance. I do not want to outline now the economic rationale of the Opposition’s attack on the Government. This was stated at some length a few nights ago by the Leader of the Opposition and it was restated yesterday with great force by the member for Melbourne Ports (Mr Crean).

I want to deal now with three features of the Budget which the Opposition finds particularly alarming. The first is the proposal to raise from $800 to $1,200 the maximum tax deduction for insurance and superannuation payments. The Treasurer gives no reasons in his speech for making this concession. He should outline its justification to the Parliament. He does not quote the cost to the revenue of this concession. We would like to know the estimated loss to revenue in a full year. Even more urgently we would like to know how the advantage of the new concession is expected to be spread across the income distribution. A concession of this kind gives a regressive twist to the distribution of disposable income. It is only significant to those who are now - or would be next year - at the original maximum limit, that is, those purchasing $800 worth of insurance annually. Obviously these are the richer taxpayers, and the wealthier a taxpayer is the greater advantage he will be able to derive from the higher limit.

Even if all taxpayers were able to utilise the increased limit to the full, the change would still be regressive. The higher a person’s taxable income the higher his marginal rate of income tax and the more valuable is a given amount of tax deduction as a means of reducing tax liability. For example, $400 of capital tax deduction would be worth $89 to a taxpayer with a taxable income of $2,400, $169 to a taxpayer with a taxable income of $6,400, and $226 to a taxpayer with a taxable income of $10,400. The effect of this socalled concession is to make insurance cheaper to buy for those with higher incomes. This sort of concession adds to the erosion of the tax base, which is already a notorious feature of government practice. It acts inevitably to the detriment of the lower income groups.

It cannot be said with any certainty that the life assurance concession will encourage saving in the form of life assurance and thereby enable more funds to be mobilised for national development. The effect of the concession on total savings is extremely doubtful. Most people will re-shuffle their existing accumulated assets in order to take up extra life policies. They will do this because the rate of return on life policies, taking account of the tax benefit, is so good. But this does not increase their total rate of saving. In fact, it could well mean that their rate of spending will be increased by use of the increased tax refunds. In this case the rate of saving would fall. The Treasurer has not justified the increase $800 to $1,200 in any way. He would be on very shaky grounds if he argued that the increase was designed to increase total savings.

One of the basic assumptions which underly the Budget is increasing activity in the building sector of the economy. The Treasurer says that expenditure on building construction has been increasing steadily and there are no signs of slackening. He says that a further increase is likely in both dwelling and non-residential construction in the year ahead. The Treasurer’s use of building construction as an indicator should be tested. I think he has either been misled by the figures or is being deliberately evasive. There is no evidence in the figures for industrial production in the last twelve months to support his claims that dwelling construction is increasing and non-residential development booming. By reliance on raw figures for dwelling unit approvals, the Treasurer has presented a distorted view of the economic progress of the building industry. These raw figures conceal dubious economic policies and inequitable social attitudes. The raw figures fail to show that dwelling construction is increasing at anywhere near the rate the Government suggests. The Commonwealth Statistician, whose work comes within the surveillance of the Treasurer, provides only the combined figure for housing and flat approvals in his monthly figures. The Government tells us from these figures that the number of new units is increasing. The actual volume of private investment in houses and flats is stagnant and not increasing as the Treasurer claims. The increase in total expenditure on buildings is little more than a money allusion. Increased labour and materials costs would very largely cancel out the increase in expenditure on houses and flats, and most of the increase in nonresidential building in the past eighteen months. I feel that the Treasurer’s account of the state of home building in the economy is questionable. He has based his Budget strategy on an economic interpretation which is not supported by close examination of available statistics.

There are other elements of the Government’s housing policy which are causing serious concern to the Opposition. I would like to refer honourable gentlemen to a survey of housing in Australia produced by the Economic Research Committee of the Housing Industry Association. The survey gives a comprehensive account of housing trends in terms of requirements, output and capacity, costs and prices, availability of finance and the operation of policies. It shows that the ratio of flats to houses under construction is growing rapidly. It indicates that in Sydney and Melbourne about 40% of flats being built are one-bedroom or even one-room units of between 2i and 5 squares. It shows that the average size of houses is increasing, that in the last ten years the number of homes being built annually has increased by 25% and that during the same period the number of fiats has increased by more than 800%. These figures reveal an alarming social pattern in the trend of Australian housing. They show quite plainly that wealthier people are living in bigger and better houses while the lower income groups are being forced into cramped living conditions.

Dwelling construction patterns are squeezing the vast middle range of the population into less and less space per family unit. This is an alarming social and economic trend. The surge of flat construction and the trend to bigger homes means that the housing of the great mass of Australian families is becoming increasingly inadequate. Yet the Government’s only positive action on housing is to reduce the provision for war service homes. As 1 listened to the Treasurer deliver his Budget Speech 1 remembered that the reason he gave for the reduction in the amount to be made available in the next financial year for the construction of war service homes was that there had been a decline in the number of applications for such homes. If one studies the reports of the Director of War Service Homes one must concede that there has been a decline in the number of applications, but what the Treasurer did not do, of course, was to explain the reason for the decline. I would refer the Treasurer to the Federal Executive of the Returned Services League, which would quite clearly and properly point out that there are valid reasons why the number of applications for war service homes assistance is continuing to decline. It is not for the reason that has been advanced to the Parliament by those who support the Treasurer on the Government side. Basically there are a number of reasons, but the prin cipal reason is that the maximum advance for a war service home in this country remains at $7,000. It has been at this level for a long perod. The Government, despite representations made to it by interested organisations, and particularly by the RSL, to increase the maximum advance, has refused to face up to its responsibilities in this respect. The last report of the Director of War Service Homes indicates that the average cost of a war service home in Australia has risen to $10,000. The Government’s maximum advance is $7,000, so the margin of security is beyond those who would be looking for assistance and who are eligible for assistance. There will be an opportunity to deal more fully with this very important aspect when the appropriate estimates are before the Parliament.

I want, finally, to refer to the question of the repatriation benefits outlined in the Budget. It is true that the Government has extended the provisions of the defence forces retirement benefits legislation to admit national servicemen who are enlisted for two years. This, in itself, is an admirable reform which the Opposition approves. Noone denies this, but I shall certainly have a great deal more to say on this question when the repatriation legislation is before the Parliament. However, the legislation puts totally and permanently incapaciatated servicemen from special areas, such as Vietnam, in an immensely superior position to servicemen disabled in the Korean war and in the First World War and Second World War. There has been no- explanation for this. No additional benefits are proposed for totally and permanently incapacitated servicemen from the earlier wars. I believe that in this respect there is room for the criticism that has already been levelled at the Government, not only by members on this side of the House but by the Federal Executive of the RSL. I hope that the Government will rectify this discrimination against totally and permanently incapacitated servicemen from earlier wars before new repatraition legislation is introduced.

Our main arguments against the Budget are that it puts a burden of additional defence costs on lower income groups; it discriminates against social service and war pensioners; it fails to put any curbs on administrative waste and extravagance; and it accentuates the drift of resources away from productive sectors of the economy. I support the amendment moved by the Leader of the Opposition.

Mr Malcolm Fraser:

– The Deputy Leader of the Opposition (Mr Barnard) is the constituted defence spokesman for the Opposition and therefore I should like to say something about one or two remarks he made in the earlier part of his speech. I think he was in the chamber this morning when I told the House, in answer to a question, the position concerning the Sheridan tank. If I do him an injustice and he was not here, I apologise, but if he was here he deliberately ignored what I then said. Orders for Sheridan tanks have not been postponed, but we are not able to give a firm order until the developmental problems are overcome and until we know that the type of tank we want is going into service in the United States Army. It will be some time yet, if and when that situation arrives. The honourable member said that we postponed our order for the Redeye missile. This, again, is not correct. We have a habit in the Army of not ordering something firmly until we know that it is going into general service, for example, as American equipment in the American Army. We can then, for future years, get our spares and resupplies in the most economic manner. Although we feel sure that the United States is going to go firm on Redeye missiles, it has not done so up to this point of time. Our order is subject to the United States ordering it for its Army, and we have made provision for it in this Budget. The honourable member reverted again to the question of the Navy destroyers and the FI 1 1 aircraft. 1 might add something that he did not mention, because it comes into much the same category - Project Mallard. Project Mallard demonstrates quite clearly the difficulties confronting a small country when it has to decide between buying known and used equipment at a fixed cost and in respect of which maintenance costs are also known, and having something that looks like being out of date or, alternatively, doing as the Navy and the Air Force have done and taking a bold step to make sure that Australia will have the best possible equipment. Project Mallard is a communications project. It is a research and development project at this stage and it is going to cost several hundred million dollars spread among several different countries. Australia is involved in it and we are undertaking part of the research and development in this country. If we did not do this Australian industry would have no possibility of entering into production contracts for any part of the finished project in the future, and this is a project that will completely revolutionise communications. We are in it, and we cannot say in any firm or precise manner what the research and development costs will be, but we want Australian industry to be involved in the enterprise and we want Australian industry to have a chance of getting production contracts. Furthermore, we want the best equipment for the Australian Army when that equipment ultimately becomes available. So, we are in it from the beginning. The Deputy Leader of the Opposition should make up his mind whether he wants Australia to have outdated equipment or whether he wants us to take some risks in making sure we get the best possible equipment for the Army.

I should like to turn now to the position in Vietnam because no war has been so publicised as this war and no war has been so much reported. I believe, at the same time, that public opinion has never been so confused as it is over this difficult situation. At times there are grave possibilities that the basic objectives and ideals are misunderstood by many people. There can be explanations why this is so. It is, I think, the first war when there has been no censorship of any kind, and thus the full horror of the war is reported, very often on a daily basis. This strikes a sensitive chord in all our minds, especially as most of us are entirely untouched in a personal or close sense by the war, except for the troops who are either in, who have been to or who may go to Vietnam. Thus the hardship and the cruelty touches us a good deal more deeply than it would if we lived on the immediate edge of some disaster. However, because we are removed from the struggle and because we want nothing but peace, we often forget the lessons we have learned in the past, that not all people or all countries share these objectives.

Amidst all the detail of the day to day reporting of this war, it is most important that we keep the paramount objective in sight, and the objective is to establish the circumstances in which South Vietnam can work out its own future without fear of aggression from any of its neighbours. This is sufficient justification in its own right, but it is justification also in another sense. What is happening here, as we know, is important to the whole region. There will «ot be any firm security for any of the countries of South East Asia - this ultimately will include Australia - unless there is firm security for all the countries of this region.

Having said this in a general sense, I want to turn to what has been done and what we are doing in the Phuoc Tuy province. It is a little over a year now since the task force was established in Nui Dat. This is an area in which the Vietcong had been unchallenged for about ten years. Over the past eighteen months, since we have been there, the Vietcong and the North Vietnamese have been moved away from the centre of population until there is now reasonable but not absolute security for 80% to 90% of the 120,000 people of the province. There cannot be absolute security, because no-one can guarantee against the terrorist attacks that are so much a part of this war, but roads have been opened, markets have been re-established and are growing and commerce and agriculture are flourishing at the moment as they have not for some considerable time in this province.

If the policies of the Opposition had been applied, this result would not have been achieved. If its policies were applied now, everything that has been achieved would be reversed. I am quite certain that the feelings of the people in this province would on every count be very much for our intervention in support of the South Vietnamese. I am also quite certain that they would not appreciate the remark of the Leader of the Opposition (Mr Whitlam), who said that our contribution to this conflict was insignificant. Perhaps he dismisses the peace and security of 120,000 people just as easily as he dismisses the respectability of Korea, of the Philippines, of Thailand, of New Zealand and of South Vietnam itself. This is not a very good way to try to win the friendship of the countries that are our neighbours and will be our neighbours as long as we survive. I think the Australian Labor Party should count the effect of its policies on individual people a little more carefully before it enunciates them so publicly.

Some may ask: Is the job in the province done? Is it completed? The anwer to this is quite plainly, No. The Vietcong has maintained a considerable capacity and over recent months, through reinforcements from North- Vietnam, has made good the damage and the casualties caused by our forces over the last twelve months. There are some suggestions that many more North Vietnamese will enter this area. They now have better weapons than they had twelve months ago. If we left, it is quite clear that the Vietcong would re-establish themselves and their domination over this area, unless other equivalent forces took our place. There has previously been a problem in South Vietnam. Security has been established in areas, reconstruction has begun and the security forces have moved on. The Vietcong or North Vietnamese have then returned. Thus the confidence of local people has often been weakened.

We must give au assurance not only that security will be estalished but also that, once established, security will remain. The people in this province are used to us. They know that the Vietcong propaganda that accompanied the lodgment of our forces in the area is false and that our purpose is to co-operate with the people of the area, to help them and to protect them. Our relationship with the local people is good, lt is particularly good with Colonel Dat, who is the chief of the province. There has been a suggestion in the Press that we should leave the province. I have not seen it elsewhere, but I mention it now because of the Press report. No suggestion has been made to me or any member of the Army on an official or unofficial level that our forces should be removed from this province. I think it is widely recognised that our work is not completed, but we should build on the achievements of the past twelve months.

It is widely known that the Army civic action will be markedly expanded over the coming twelve months. Formerly this work was done by troops whose prime responsibility lay in the field of active operations, and thus it was difficult to maintain the continuity of the programme. A new Civil Affairs Unit of nearly fifty men will ensure continuity and more will be done. This unit will have the responsibility of selecting projects, of seeing that the work is carried out and of co-operating with the local officials, the Revolutionary Development Teams and the local people in the province. I should like to mention that the Army is grateful for the outside help it has received in this effort from such organisations as the Returned Services League, the Australian Vietnam Civil Action Project and the Defend Australia Committee. This is welcomed for two reasons. It is welcomed because help ‘is needed and it is welcomed because it demonstrates that a very large number of people in Australia support the work of the troops in the area. We find that considerable advantages flow from having civic action work carried out by troops in uniform rather than by civilians. It encourages the local people to gain much greater confidence in those who are actually responsible for their security.

The overall progress in the province and throughout South Vietnam in the last twelve months has been steady, but certainly not spectacular. New areas have been opened up to security and the Revolutionary Development Teams are now working actively in many areas that were quite unsafe a few months ago. This is being done, despite the fact that the North Vietnamese have not only the 50,000 troops in South Vietnam occupied in the struggle but also an equivalent or greater number in and around the demilitarised zone. These forces cross the border from time to time for particular operations and then move north again. Thus, the enemy has more than 100,000 troops directly involved in this struggle.

I have met people who find it difficult to understand why the 1,200,000 members of the free world forces have not been able to overcome quickly the 300,000 Vietcong and North Vietnamese. This may be difficult to understand, but I think those who cannot understand why the free world forces cannot reach a quick conclusion misunderstand the nature of the problem. This is largely explained by the differing roles of the free world forces and of the enemy. Our task is to protect people, to hold country, to reconstruct and to provide security on a firm and continuing basis. The enemy has no obligation to hold territory or to supply services to the villages. His purpose is to demonstrate that the South Vietnam forces cannot supply security. His purpose is to terrorise, to subvert and to destroy. His purpose is to so impress this lesson on the people in the countryside that they will unquestionably do all that the Vietcong tell them to do. The Minister for External Affairs (Mr Hasluck) mentioned that 1,700 people had been murdered by the Vietcong since 1st January of this year. In addition, 3,000 have been wounded and 2,000 have been abducted over the same period. I have here a study of the Vietcong use of terror. It demonstrates in clear and stark terms how effective the methods of the Vietcong are. This difference in the roles of the opposing forces, I believe, explains the apparent disparity in the size of the forces and how the Vietcong have in the past been able to achieve much more than we may have expected if we had merely considered the size of the forces.

In recent times there has been some evidence to suggest that the Vietcong morale is wavering. The number of defectors has doubled since last year and is about 20,000 up to this point of time. I would like to draw one analogy with the situation in Malaya during the Communist insurrection. The Communists there numbered 5.000 and the British had available to them 60,000 troops. The ratio was twelve to one, but it still took ten years to overcome the Communist insurrection there in circumstances that were infinitely easier than those we face in Vietnam.

Because it is said by some that the Vietnamese do not do very much to help themselves, we often hear the question asked: Why are we involved in this struggle and why are the Americans involved? I think it is natural that Australians are interested in reading about the exploits of Australian servicemen and the same could be said for the United States, but this sometimes leads to a misunderstanding. The Vietnamese, I believe, have done and are doing a great deal to help themselves, lt should be remembered that up to the early part of 19o5 South Vietnam was fighting alone and suffering quite enormous casualties, casualties of a kind that would damage the morale of any army, lt was at the same time a deliberate policy of the Vietcong to assassinate anyone who might become a civilian or military leader. Thus it was no wonder that the South Vietnamese Army became short of experience on the ground.

But since early 1963 much has been retrieved. The quality of their units is still uneven, but substantial efforts have been made and many of the South Vietnamese units are now fighting very well and have continuous records of victory against the enemy. There was a popular force platoon of twenty-six men in our own province area and this platoon was attacked by a reinforced battalion of Vietcong and North Vietnamese. The platoon’s twenty-six men and their wives held out for several hours until an Australian battalion arrived and then the Vietcong and North Vietnamese withdrew. The popular force platoon had only few casualties but had inflicted heavy casualties on the enemy. If this had occurred to an Australian platoon it would have been written up as one of the proud chapters of Australian military history, but since it happened to one of the South Vietnamese platoons we did not hear of it. i should like to quote the record of one of their divisions in 1 Corps which has been on operations for twenty-eight days out of every month since the beginning of this year, lt has conducted more than ninety operations of battalion size or larger. 1 do not like the cricket score board method of indicating victories, but this division has killed more than 5,000 North Vietnamese and Vietcong for the loss of about 1,000 of its own men. lt has a continuous and proud record of victories against the enemy. These are just two instances. Other examples could be given. Those who say that the Vietnamese Army and people are not fighting in their own interests do not understand the nature and difficulty of the problem. But the problem is not only in the military field. There are about 30,000 members of the revolutionary development cadres out with the villagers. Their purpose is to assess the needs of the villages, to help them and to encourage them to help themselves. General Thang, who is responsible for this programme, is most concerned that the people maintain a will to do things for themselves. Five of these teams are working in our own province and they are working well. It is a major part of the work of our own civil affairs unit to co-operate with them.

There are achievements in other directions, as the Minister for External Affairs earlier commented. They have made considerable advances towards representative government, lt must be remembered that they have no traditional British background in democratic government. Even though the country is beset by war and insurgency, notable moves have been made in this direction. The final steps huw yet to be taken, but when I was there a short time ago the indications were that (he elections would be fair and reasonable. I have met many people throughout the year who thought that the effort to establish representative government in these circumstances was a vain waste of time. So far these doubters have been proved wrong. I wonder how many of us recall that when the United Kingdom was threatened with invasion during the last World War by deliberate decision of the political parties the United Kingdom suspended democracy and elections until the war had ended. In contrast, the South Vietnamese, fighting desperately within their own borders, are attempting to introduce and make effective the normal institutions of a peacetime democracy. They have already demonstrated what they can do in local government elections, as the Minister for External Affairs has intimated. In an election for the constituent assembly, 4.3 million of 5.3 million people voted. That was 80% of those on the rolls. It is well known that they have asked observers to visit their country and to judge the elections for themselves when the time comes.

I should like to say something about the bombing of the north. I do not know how many of us realise that the war in South Vietnam is a defensive war directed towards keeping the North Vietnamese out and protecting the life and property of the people of South Vietnam. There are no aggressive expansionist objectives by the free world forces in South Vietnam. The only offensive tactic is the bombing of North Vietnam. Those opposing the bombings are virtually saying that the free world forces should conduct themselves in a purely defensive manner. I doubt if anyone could point to a war in which forces which have behaved in this manner have not lost. They are saying also that the allies should deny themselves the one offensive tactic which will assist the military effort while remaining within political and humanitarian restrictions that have been placed on military operations in South Vietnam. This and the other planks in the present Labor Party platform give enormous advantage to the enemy. Yet I can hardly really believe that they want the Vietcong and the North to win.

The Australian Labor Party Conference states its terms of co-operation with our ally, the United States of America. It should be noted that it is still the Conference and not the parliamentary members who dictate the policy. Of a total of fortyseven conference members only four are Federal parliamentarians. It is this Conference that dictates to all parliamentarians in the Opposition ranks. All ALP members are subject to this direction in a manner that neither we on this side of the House nor the United Kingdom Labor Party would ever accept.

Mr Curtin:

– That is not true.

Mr Malcolm Fraser:

– If the honourable member will check on the situation he will find that it is true. The Australian Labor Party objectives are these: That the bombing should stop; that the National Liberation Front should be recognised as a party to negotiations; that operations in Vietnam should virtually cease and that the only moves made should be with a view to holding the territory which is already occupied. I believe that to stand still in this kind of war would be virtually to lose. The allies could not accept this ultimatum. The objective of the bombing has been to bring increased military pressure on the North to make it more difficult for her to send supplies of men and equipment south; and also to demonstrate that aggression shall not succeed. Having convinced the North of this, and coupled with military reverses for the North’s forces in the South, a further objective is to persuade them that there is no point in continuing and that they had therefore better turn to negotiations.

Both the Leader and the Deputy Leader of the Opposition have claimed that the bombing has failed in its purpose. This claim cannot be justified. If and when the North Vietnamese decide to negotiate, they may well change their minds overnight. If this occurs it may well be that the bombing of the North has been a substantial factor in persuading them to negotiate. Can anyone say that there is no evidence that North Vietnam would have negotiated if there had been no bombing, or that North Vietnam would now negotiate if bombing ceased? There is no such evidence. The bombing has made it much more difficult for the North Vietnamese to maintain and reinforce their armies in the south. Without the bombing they would have been able to organise a much larger military effort in the south. There are half a million men reinforcing and repairing the roads in North Vietnam to keep the supply lines open. The cost of moving supplies and men from north to south has grown enormously. In the ninety-six hours truce from 8th February to 12th February this year it is estimated that 25,000 tons of supplies were moved out of North Vietnam by 2,200 trucks and 1.570 coastal vessels. But let us look at this in terms of its effect on our forces.

In the seven months to January of this year American marine divisions in the northern part of South Vietnam were on the receiving end of a little over 800 rounds of mortar fire each month. In the four months after the truce mortar fire increased to an average of more than 4,000 rounds per month. Artillery fire averaging 1,000 rounds a month was introduced for the first time, in addition to damaging rocket attacks such as that which was directed against Da Nang. Those who say that the bombing should cease without a reciprocal move from the North are virtually saying that we must accept heavier casualties. I wonder how successfully the Leader of the Opposition or the Deputy Leader would advocate this course to an Australian public supporting our task forces in the Phuoc Tuy province. If there had been one sign during the truce periods that the North bad even refrained from moving supplies to the south it is probable that the bombing pauses would have been extended, but there was never a sign and never a gesture from the North.

I want to mention something said by the Deputy Leader of the Opposition. In his speech a while ago he mentioned that forty-five hospitals had been destroyed up to Christmas last year in North Vietnam. He quoted what he said was a responsible and respectable journal, the ‘Economist’ of 6th May this year. But the Deputy Leader either was given this information and did not check it for himself or, if he did check it for himself, he must have misled the House because I have the Economist’ here. Under the heading the article states:

A correspondent who has recently visited North Vietnam for the Bertrand Russell Peace Foundation reports on the bombing of North Vietnam, particularly on the health services.

This was not a correspondent for the Economist’ but a correspondent supported and sent by the Bertrand Russell Peace Foundation. He reported on the effects of the American bombing, particularly on health services, collecting information for the notorious Stockholm trials run by Bertrand Russell. This is the kind of evidence which the Leader of the Opposition cites. The Labor Party’s policy represents an ultimatum to the United States. I cannot understand how the Leader of the Opposition or any of his supporters can support such a policy and still claim to support the American alliance.

The Leader of the Opposition claimed that the Prime Minister (Mr Harold Holt) had embarrassed the United States and he implied that the bombing of the north was continued because of a speech made in Los Angeles by the Prime Minister. The Leader of the Opposition suggested that United States officials had told him that they were moving against the bombing during this period. The recent intensification of the bombing would not support that claim. This is not the first time the Leader of the Opposition has imputed views to United States Administration officials which they certainly never presented to him. In May last year he said that in the United States

I had advocated dropping the bomb, presumably the atomic bomb, on Hanoi and flooding the dykes, thereby drowning millions of people in North Vietnam. I denied the allegation at the time, but the honourable gentleman repeated the charge a short while ago. United States officials will in future doubt the wisdom of having discussions with the Leader of the Opposition. I believe they would be justified in refusing to see him on any future occasion, but their natural courtesy will probably prevent them from taking this course.

The Leader of the Opposition also said that half the United States senators were now in favour of recognising the National Liberation Front and were opposing the Administration. In the vote in the Senate in March last on the supplementary estimates for Vietnam the numbers were seventyseven to three in favour of the Administration. In the last day or two there has been a vote on the major defence appropriation, including substantial reinforcements for Vietnam. There was a vote of eighty-five to five for the President and his policy. None of this supports anything that the Leader of the Opposition has said. He said that no military supplies go to North Vietnam through Haiphong. This is not correct; they do. He said that the bombing was the kind that brought China into the Korean war. That is not true. The bridges over the Yaki River were attacked only after it was obvious that China would enter the war.

I would like to return to one aspect which concerns our public understanding of this war. Our public and private consciences are often disturbed because of the stories of hardship, difficulty and tragedy which are constantly coming to us. These are published freely because there is no censorship. At the same time we go about our own lives, largely untouched by the war except for our soldiers who are in Vietnam. There are many of us who would like to think that a war can be fought entirely with clean hands. Some of the public comments would seem to suggest that war is all right so long as you fight within certain restricted and gentlemanly rules. Of course, all the free world forces keep to the only rules there have ever been on this subject - lbc Geneva Convention. But we should not try to deceive ourselves, as I think some of us do, and suggest that war can be fought as though it is not much more than a Sunday afternoon tea party. In any war there will be innocent people who are hurt or killed as a by-product of that war.

When the history of this conflict is written it will, I believe, be said, as the editor of the ‘Age’ suggested recently after a personal inspection of the area, that no war in history has been so circumscribed by social, humanitarian and political considerations. When the enemy troops withdraw into Laos free world forces cannot follow them. When they withdraw north of the demilitarised zone, they cannot be followed. Wherever they withdraw out of Vietnam they are safe from pursuing troops and on countless occasions actions have been cur tailed or altered because of a wish and a determination to avoid civilian casualties whenever this is possible. But it is idle to suggest that these will not occur. Despite all our best efforts the wrong people will sometimes be hit. This should not be taken to mean, however, as it sometimes is, that the price is too high.

I do not know how you measure this kind of cost. Did Britain say that the price was too high in 1940? Did the Greeks between 1945 and 1949 when struggling against Communist insurrection say that the price was too high? Did the South Koreans who were blatantly attacked in 1951 say that the price was too high? In all the course of history if free people had said the price was too high there would be no freedom today. We seek to limit the cost in terms of human suffering but it is not possible to avoid some cost. If we give up now because the effort is too great, what would we say when we saw the purges that would inevitably follow as a victorious North eliminated all those people who had fought for the independence of South Vietnam? What would we say when increasing insurgent pressure was put upon Laos and Thailand? Would we again say that the price is too high? When would we remember that freedom and independence of a people have a value which is beyond price? There have always been men who would fight against great odds because they believe. There is much evidence of such belief in South Vietnam in the battalions which struggle boldly and in the revolutionary development cadres which defy the Vietcong. Is this emerging Vietnam to be denied that for which we would rather fall as a nation than deny ourselves? [Quorum formed.]

Smith · Kingsford

- Mr Deputy Speaker, one can be sure that in every city and town, in every suburb, village and hamlet in Australia one will find a post office, either official or otherwise. And in each of the eighty-one electorates represented in this Parliament by Liberal and Country Party members one will find one or more post offices. I have listened intently to the debate on the Budget, hoping against hope that I would hear some support for the postal employees in their fight for a five-day week roster in the Post Office. But not a word have I heard from these Liberal and Country Party members in support of this great body of government employees in their fight for a great Australian principle. I take this opportunity of reminding the House that in April last I asked the Postmaster-General (Mr Hulme) to give consideration to the introduction of a fiveday week roster for Post Office employees. I stressed at great length the known advantages which would accrue from its introduction. However, the Postmaster-General, as a member of this Government, flatly refused to negotiate with the postal unions. Why did the Postmaster-General’s staff go out en masse on 1st July last? Let us hear the truth. After forty years of negotiations with this Government the Post Office workers have realised that the Government is refusing to acknowledge that an injustice exists.

About 82% of the working population in Australia enjoys the benefits of a five-day working week, yet the Government grossly discriminates against Post Office workers. Why? Is it because of the Government’s failure to heed departmental anc! union representations in favour of a five-day working week? The introduction of a five-day week roster appears to me, Sir. to offer a simple solution to the many problems of the Post Office. This system of rostering has been u->ed most successfully in commerce and industry, State and Federal Public Service Departments and various statutory authorities for many years. So it is that through some inexplicable quirk of fate

Australia’s largest business, the Post Office, Works to a six-day week roster. This sort of antiquated thinking went out of date with the pre-war era. Undoubtedly its continuance in the Post Office is due to many previous years of control of the Post Office by the Australian Country Party. This is why the Post Office has become so out of date and so greatly out of step with industry and commerce in relation to the conditions and treatment of its employees.

There is undoubtedly a certain air of the backwoodsman about the approach of the authorities to the employment conditions of postal staff. I refer specifically to the onerous six-day working week. In every city, town and village throughout Australia, there is a Post Office, and in each centre and settlement there are hostile electors who know now that they are being deprived of their just rights. This is evident by the way in which the electors at the recent Corio byelection showed their disapproval of the Government’s behaviour. Disapproval of the Government’s attitude to postal employees contributed in no small way to its defeat in that by-election. The result was most distasteful to honourable members opposite and Ministers, especially the Postmaster-General, who. I am pleased to see, is now in the chamber. The Government’s majority of 9,000 at the previous poll was changed into an absolute majority for the Australian Labor Party’s candidate at the by-election.

Postal unions and even top departmental administrative officers’ are mindful of the decline in the efficiency of the Post Office, which is due to the fact that it cannot attract suitable staff. Why would the youth of today accept a position that requires him to work six days a week when he knows that he can get a job at which he will have to work only five days weekly and for which, almost without exception, he will receive a higher weekly wage? Who in his right mind would believe that suitable clerks could be attracted to and induced to remain with an organisation in which the career structure is based on an itinerant life, a six-day week roster and low award wages?

Honourable members recall the stoppage that occurred in the Post Office on 1st July. After years of fruitless negotiations, mass meetings of postal employees throughout Australia decided that they had had enough. In frustration, they served notice on the Postmaster-General that unless their conditions were brought into line with those of other employees of the Federal Government and of the overwhelming majority of private employees throughout Australia by the introduction of a five-day week roster, they intended to withdraw their labour on 1st July and hold protest meetings. The Minister for Customs and Excise (Senator Anderson), who was acting PostmasterGeneral at the time, was advised of the intentions of the combined postal unions several weeks before that date. His approach, of course, was to threaten - threaten, mind you, Sir - punitive action against the employees should they give effect to their intention to stop work on 1st July. That is terrible. What would be the reaction of any self respecting Australian to such a threat? Naturally, he would go ahead and participate in a stop work meeting. I have done the same sort of thing during my own industrial career. Senator Anderson, by his threat, in effect forced postal employees to go on strike, for they knew that if they cowered down and submitted to him they would never get what about 82% of Aus-tralian workers enjoy - a five-day working week. As honourable members well know, the postal unions are not trying to break new industrial ground, but are merely endeavouring to bring the conditions of postal workers into line with the accepted Australian standard of a five-day working week.

Have honourable members heard of or read the terms of the notices of charges and the actual charges made by the Post Office authorities against the employees who took part in the stoppage? Are they aware of the threats that were made? I shall read one of these notices and one of the charges word for word. After listening to the Minister for the Army (Mr Malcolm Fraser) talking about the Communist dictatorship that we are fighting in Vietnam, I thought that this sort of thing would never reach Australia, but unfortunately it has reached our Post Office. I have here the name of the gentleman to whom this notice was addressed, but I shall not give it. Indeed, as telephones were being tapped, I was afraid to leave these two documents lying about for fear that our rooms also might be entered. The notice is in these terms:

page 473


Postmaster-General’s Department, General Post Office, Sydney.

Public Service Act 1922-1967

Notice of Charge under Section55 (Without Suspension)


Postal Clerk

Take notice that you have been charged with the commission of an offence under section 55 of the Public Service Act 1922-1967 a copy of which charge is set out below. And take further notice that in accordance with the said section 1 hereby require you to forthwith state in writing whether you admit or deny the truth of the charge and to give any explanation in writing you may think fit as to such offence for my consideration. And take further notice that pending the determination of the chargeyou will be permitted to continue in the performance of your duties subject to any subsequent action which may be considered necessary as to your suspension.

Dated this fifth day of July 1967.

There then appears some scribble over the notation ‘For Chief Officer’. Hail the Fuehrer. This is in Australia, mind you. Here is the charge itself:

hereby charge- Postal Clerk on duty–

The name of the suburb is mentioned - with the commission of an offence within the meaning of section 55 of the Public Service Act 1922-1967, namely

That the said– at– in the State of New South Wales on the first day of July 1967 was guilty of an offence against section 55 (1) (() of the Public Service Act 1922-1967 in that he being a person appointed to the Commonwealth Public Service did commit a breach of paragraph (0 of Regulation 13 of the Public Service Regulations made under the said Act in that he did absent himself from duty without the express permission of the Chief Officer or the Officer in Charge.

This is in Australia, mind you. We on this side of the Parliament thought that this sort of thing could come only from a Communist dictator. But we find that it is tolerated in the Post Office by the PostmasterGeneral.


– Order! The honourable member for Maribyrnong will come to order.


– How the dogs bark, Sir. These fines that were imposed on a group of Post Office employees represent the most savage penalties ever imposed on a group of Australian trade unionists. It is extraordinary that other Commonwealth employees who have attended stop work meetings or taken part in strikes have not been penalised at all. It is also noteworthy that these fines have been imposed on permanent officers, without any similar imposition on temporary employees. This makes the treatment of the officers involved seem even harsher.

Stop work meetingsand strikes by Commonwealth employees overthepastfew years have been dealt with in either of two ways. There have been some stop work meetings and strikes which have resulted only in loss of salary of the employees concerned for the time involved. For other stop work meetings no salary has been deducted for the time during which the meeting was held. In the present case the penalties have been imposed under a section of the Public Service Act. section 55 (1.) (f), which is intended for misdemeanours of a minor and fairly routine kind, such as an unauthorised absence for a private reason, drunkenness or the like. It seems clear that this section of the Act was not meantto cover the offences for which these penalties have been imposed. The fines are harsh and inappropriate and will lead to recriminations, resentment, unrest andloss of efficiency in the Post Office. They arose from a situation of industrial stalemate which the postal unions did not create and which they tried to avoid.

The fines of $4 on juniors and females are harsher still when one considers that they receive salaries so much lower than those of adult males. Officers fined$4 have no right of appeal. What an extraordinary set-up in a so-called democratic country. To me these documents of a punitive character which I have referred to are most repugnant. Undoubtedly postal workers have been shocked to learn how democracy works under the Holt Government. These repulsive documents have been issued by the Government to its employees for no other reason than that they held an on-duty protest meeting about working conditions which every member of this House must realise were sufficiently distasteful to justify such a stop work meeting. Natural British justice suffered a bitter blow with the imposition of these penalties. In the first place they were imposed on Australian workers for obeying the lawful commands of their unions.

The Postmaster-General showed fox-like cunning in restricting the fines to $4 each. If they had exceeded this amount all the postal employees involved would have had the right to appeal against them. This is something that the general public of Australia has not’ been told, either through the Press or in any statement from the PostmasterGeneral’s Department. If the fines had been of more than $4 each and all the employees concerned had availed themselves of the right to appeal, the Public Service Appeals Board would have faced a chaotic situation.

The cause of democracy and justice has suffered from this outrageous act. It is typical of the Fascist way of life under this Government and totally foreign to the Australian way of life and to Australian justice. The employees concerned have been denied any right of appeal. This is Hitlerism of the worst kind.

Mr Arthur:

– They were asked to give written explanations.


-Order! The honourable member for Barton will cease interjecting.


– The dingoes howl on moonlight nights. I see no obstacle, Mr Deputy Speaker, to the introduction of fiveday rosters in the Post Office. The police, railway and bus enterprises, light and power authorities all provide services over seven days of the week and they can all arrange to roster their staffs on a five-day basis. I suggest to the Postmaster in all sincerity that he introduce a five-day working week forthwith. This could be done immediately by rostering the present staff for forty hours Monday to Friday and paying them overtime rates for Saturday work if it is considered essential that they work on Saturdays.

Mr Hulme:

– Overtime is being paid now.


– This is the kind of arrangement that exists in many organisa tions, and the Postmaster-General’s Department is paying overtime rates to all and sundry at the present time because it has been found impossible to recruit staff to work in the Post Office. If my suggestion were followed we would surely see an improvement in staff morale and therefore in staff efficiency. The Department loses thousands of dollars annually because of staff wastage. This is the real stuff that I am giving the house, the real truth of the situation. The Department has wellappointed schools for training but experience has shown that juniors, after undergoing a six-month course of training, resign in alarming numbers. The major reasons for the resignations are a dislike of working a six-day rostered week and the low salary offered by comparison with commercial organisations generally - in other words starvation wages.

Because of the inability of the Postal Department to attract and hold sufficient staff of the right type and calibre, there is at present, particularly in the metropolitan areas, an enormous amount of overtime being worked. True?

Mr Hulme:

– No.


– The Postmaster-General says no, but men in official positions who have access to these statistics are in a position to know the facts of the situation, and they say yes. If the hours for which staff are now rostered on on Saturdays were transferred to their Monday to Friday shifts, overtime through the week could be reduced by a vast number of hours. Then if the Department wanted the post offices to function on Saturdays it would have to pay only the Saturday overtime rates. It is most likely that the Department would in fact make some very considerable financial savings overall.

The Government must be realistic and accept the principle of the five-day week. Its acceptance will lead to a much better Post Office service. I suggest that the PostmasterGeneral get down off his high horse. Improved Post Office efficiency would be the natural result of the acceptance of the five-day week principle because the staff would be more contented and of a higher quality. They could be recruited from a more selective field. There would be less need to try to fit square pegs into round holes, which is what is being done at the present time.

Mr Donald Cameron:

– Is the honourable member saying that these boys are no good?


– The honourable member for Griffith will get the first plane out of here in the morning. He likes his Friday, Saturday, Sunday and Monday off. If my suggestion were accepted the Australian Post Office would be able to compete on the labour market with its arch-competitors such as the banks and insurance offices.

There are many aspects of Post Office administration in need of scrutiny. There is, for instance, the way in which the arbitration system affects post office employees. The system is weighted against small staff unions, and in the Post Office there is a large number of small unions and associations. For example, the numerically weak Postmasters Association is obliged, as are the other small staff bodies, to pit amateurs, as their advocates, against the Commonwealth Public Service Board’s professionals in arbitration cases. Associations and unions in this field are prohibited by the Act from engaging professional advocates. Therefore they must throw an amateur into the ring, and the Commonwealth Public Service Board is not renowned for recognising the Marquis of Queensferry rules in arbitration cases.

The annual financial statement of the Postmaster-General is another matter that requires scrutiny. I suggest that the cost of maintaining unprofitable services in areas could rightly be charged to national development. The cost of training clerks, technicians and tradesmen who resign within twelve months of completing their training to take up appointments in private industry could be shown as a government subsidy to private industry, because big industries benefit from this considerably. Provision could be made in the annual financial statements for the estimated loss on parcel and packet services in the highly profitable areas such as the capital cities. The loss is caused by the present Government’s policy of lowering the standard of parcel services thereby diverting this profitable traffic to private enterprise, although the Postal Department is required to provide this type of service in the outback and in other totally unprofitable areas.

In an endeavour to improve efficiency, the Postmaster-General’s Department introduced, many years ago, a staff suggestions board. I ask honourable members to listen to this story which illustrates the generosity of the Postmaster-General to his employees. Staff suggestions have accounted for some really remarkable improvements to the service. However, the suggestions scheme has developed into a rather one-sided affair. It operates in the Department’s favour and at the expense of the staff. As an indication of the generosity with which the Postal Department dispenses its rewards for suggestions regarding improvements let me illustrate the matter in this way. The assets of the Postmaster-General’s Department for the financial year ended 1966-67 amounted to $1,412,040,777. The maximum amount that this huge organisation is allowed to pay - and it seems I know more about this than the Postmaster-General does - to a proponent for an idea to improve its services and operations, without first obtaining the Commonwealth Public Service Board’s approval, is the huge amount of $10. The Postmaster-General’s Department cannot pay more than $10 to a member of the staff for a service improvement unless it gets the Commonwealth Public Service Board’s approval. It is both astounding and ridiculous that an organisation must get outside approval to spend more than $10 in that way. Judging by this $10 limit honourable members can well imagine the meagre amounts paid by the Postmaster-General’s Department to its employees for suggestions in relation to improvements. I know of the astounding case of an officer - with inventive capacity and genius and I ask honourable members to listen to this - who has had forty suggestions accepted and adopted by the Department. The total amount paid by the Department for these ideas for service improvements amounted to the magnificent sum of approximately $200. The rewards for good suggestions are extremely meagre. I suggest that the Postmaster -General review the amounts of rewards for suggestions.

I suggest also that the Prime Minister (Mr Harold Holt), the Postmaster-General and the other Cabinet Ministers take a good look at the Postmaster-General’s Department generally, with a view to putting it back on its feet and arresting the decay in service and morale, which their policies deliberately have brought about. I appeal to the Postmaster-General to restore to the employees of this great organisation the pride which they once had in it. I am very concerned about this matter. I want the Government to give the people again the type of efficient postal service for which the Postmaster-General’s Department was once so well renowned. The Government should begin this task with a reform which is already more than twenty years overdue. I make a personal appeal to the Postmaster-General to wake up to himself. The Post Office should introduce a five-day roster. I do not agree with what the Government is trying to insinuate in regard to a five-day roster. Employees of the Post Office are prepared to work a six-day week, if necessary, on a five-day roster. We must always keep in mind the Prime Minister’s recent statement that we cannot live in a lotus land. He attacked the practice of working only forty-five weeks in the year. Above all he made an attack on the forty-hour week. 1 suggest that the autocratic, dictatorial and arrogant attitude of the Prime Minister, the Postmaster-General and the Minister for Labour and National Service (Mr Bury) is typical of the attitude of members of the Government generally towards industry and its personnel. This cannot be tolerated. It is anti-Australian. The truth of the matter is that the Government has been here too long. It is time for a change.


– The honourable member for Kingsford-Smith (Mr Curtin), who made the most effective Opposition speech I have heard during this debate, at least had an. interested and appreciative audience, which is more than can be said for the Opposition members who spoke before him. The reason for this is that throughout this debate the Opposition has given us the mixture as before. It has been putting forward these ideas ever since it emerged as a political party even though it has a new look in leadership at present. Its ideas are just as sterile and barren and out of touch as ever they were. I believe that the Labor Party has not learnt the primary lesson of life - adapt or perish. It is completely oblivious of the fact that since the Party was first formed the world outside has changed dramatically.

We are now living in an affluent society. We are living in one of the wealthiest countries in the world, with a more even distribution of wealth among its people than other countries. I shall support this sweeping claims by some figures which I shall quote as percentages of the gross national product. In terms of savings as a percentage of the gross national product Australia ranks fourth in the world. In regard to total taxation we are sixteenth on the list. We rank well down the list as a tax country. This means that people generally in Australia are able to dispose of their money more freely than people who live in most other countries. Our fixed capital investment is very high indeed - our rate puts us second on the list. We are also great savers. We are extremely generous in regard to foreign aid. We are second on the list among countries granting foreign aid, and most of our foreign aid is in the form of outright gifts and not tied loans.

When we consider these figures we realise how greatly out of focus is the Labor Party’s picture of present day Australia. However, this is not all. People now forget that Australia went through a very severe drought in 1965-66. That drought had the effect of setting back very substantially our gross national product. Prior to the drought our increase in gross national product was increasing by more than 6% per annum, which was a very healthy rate of increase. As a result of the drought in 1965-66 that increase dropped to 1%. The Treasurer (Mr McMahon) in his speech the other night told us that the increase in the gross national product was picking up again. In this year it is estimated to be between 5% and 6%, which is almost back to normal again. Yet despite that very large downturn caused by the immense losses in the drought, Australia has remained a wealthy and stable country and we have been able to carry out all the objectives that we have attempted in the fields of defence and investment.

The Treasurer also has been able to make some concessions in taxation to various people this year, which are very welcome indeed in the circumstances. But although this picture is such a good one and we can take pride in the wealth and strength of our economy, we must bear in mind always the maxim that 1 quoted earlier - adapt or perish. If we do not do this our fate as a country will be similar to that of the Australian’ Labor Party. We will become sterile. We will go towards total and utter extinction.

There are three factors which we must bear in mind at this particular time. One of them is the domestic policies which are operating in the traditional capital exporting countries and which limit the amount of capital that is made available for investment in Australia so as to help us to develop this great continent. The second factor is the fall in the price of wool which is very serious indeed. It will cut back quite drastically our overseas earnings. The third factor is the threatened removal of British influence from the Asian sphere of the world to somewhere west of Suez. These three pointers should cause us to take appropriate action. Tonight I will suggest three different steps that we could take in order to cope with each of those threats in turn. Each of the steps consists of a proposal to form a council of one kind or another on a national basis.

The first council that I suggest should be established on a Commonwealth-State basis is a national development council. I will not discuss this matter at length tonight because this is a project which has received, and is receiving, a great deal of thought from a group of Government supporters. But I point out that this very thing was advocated by the Vernon Committee of Economic Enquiry. It was also advocated by the Stanford Research Institute which carried out a survey of the Australian economy a few years ago. I believe that it is in line with the suggestions contained in the Treasury’s survey of the economy which was published in May of this year. It warned us of the necessity to adapt pur institutions to meet the limitation which will be imposed on overseas capital coming into the country.

I am particularly impressed with the idea of a national development council because the House will know that I am anxious to see the Darling basin developed in the way that river basins are developed in other parts of the world. This idea has been supported very strongly by people who live in the Darling basin area in both Queensland and New South Wales. Unfortunately, the idea of developing this basin as a single unit has not met with the kind of enthusiastic reception by the Government in New South Wales that it has been accorded in Queensland. This is a situation with which we are all familiar in Australia. Owing to the difficulties of federation we customarily find one or two States agreeing and the rest disagreeing to a proposal. It is very difficult indeed to achieve unanimity of aim and purpose between all the governments in Australia simultaneously. We have run up against this trouble in trying to, push this project concerning the development of the Darling River basin. Yet people who live there know that in time this area must be developed because it is an area which is subject to periodic droughts and those droughts cost an enormous amount of money - so much that they affect the total Australian economy.

On the credit side, it is an area which can produce the kind of commodities for which there is a ready market in Australia and especially overseas. Due to its peculiar soil and climatic conditions the Darling River basin is an ideal place for the production of beef, veal and mutton. It produces row crops such as cotton. In a year or two it will be supplying the total Australian usage of cotton. It can produce sorghum and milo for which there is a tremendous demand outside Australia, i am firmly convinced that within the next few years this area will become the centre of the soya bean industry in Australia. All that it needs now to realise this potential is to have the governmental authorities which are involved in the area brought together to plan and to co-ordinate all necessary works so that the area can be developed according to a set plan. I am sure that the development council, when it comes to pass, will be the ideal instrument for bringing into being this Darling conservation scheme. It will be a scheme which will rate along with other schemes of similar purpose and design in other parts of Australia. I am quite certain that when it is compared with other developmental, productive projects, it will rate a very high priority indeed.

Now I turn from this matter of the national development council to the second of the councils which I believe should be established by this Government. The downturn in wool prices is a reminder to us that we cannot and should not depend always on the export of primary commodities for our foreign earnings. We should diversify. We should have a large export of manufactures in order to strengthen our position in the world. In order to achieve this export of manufactures against world competition and knowing what a small home market we have, we must have a very high degree of efficiency in secondary industry in Australia. We know this. Yet is it extraordinary that Australia alone among advanced Western countries has no national productivity council This is a most extraordinary situation and- I believe it should and must be corrected by this Government at the earliest possible opportunity. Such a council would bring together the present 150 productivity groups throughout Australia; it would give them leadership; it would coordinate their activities; and it would act as a general secretariat for them.

The Institute of Public Affairs claims that repeated efforts have been made over a period of some years to obtain government support for an Australian productivity council but they have all failed. I cannot understand that, knowing our situation in Australia with virtually full employment, and knowing that we must emphasise quality. We will always be a numerically small country by comparison with the other nations. We must have a high degree of manufacturing efficiency if we are to survive. I cannot understand why these repeated efforts have had to be made in the past to obtain government sanction for a national productivity council. I hope this is something that the Government will now speedily put right.

There is another function that such a council could perform. In the realm of productivity we find ourselves in rather murky waters because it is extremely difficult to reduce productivity to figures. In fact the Commonwealth Statistician has refused to do so. Although some other countries are not quite so sensitive about it, I believe the Commonwealth Statistician is quite right in his refusal to embark on the rather hazy business of putting together figures which are supposed to reflect changes in productivity. Since we have no figures to go on, it is all the more necessary to have an advisory body which can help the Government to form an opinion on the way in which changes in productivity are taking place in this country and how we rate by comparison with other manufacturing countries. This information would be of value to the Government in framing its policies. It would have particular application in the framing of tariff policies and wage policies. So, there would be a side benefit from the formation of a national productivity council.

Finally, I want to suggest a third national council and this is simply an Australian council. We have no Australian council, yet this is a time when we know that we must project the Australian image, the Australian way of life and the Australian attitude beyond our shores in order to build bridges of understanding between our people and our neighbours in Asia. Canada has a council; India has a council and of course, the British Council is the parent of them all and its functions are well known. I will read to the House part of the legislation which set up the Canada Council so that we will have on record the type of things the Canadians aimed for when they established their Council. I do not believe we should adopt an exact replica of the Canada Council. Far from it. I think that it would be appropriate for us to look at the operation of the Canada Council and adapt it to our particular needs in this part of the world. The objects of the Canada Council are said to be: . . to foster and promote the study and enjoyment of, and the production of works in, the arts, humanities and social sciences, and, in particular, but without limiting the generality of the foregoing, the Council may, in furtherance of its objects,

  1. assist, co-operate with and enlist the aid of organisations, the objects of which are similar to any of the objects of the Council;
  2. provide, through appropriate organisations or otherwise, for grants, scholarships or loans to persons in Canada for study or research in the arts, humanities or social sciences in Canada or elsewhere or to persons in other countries for study or research in such fields in Canada;
  3. make awards to persons in Canada for outstanding accomplishment in the arts, humanities or social sciences;
  4. arrange for and sponsor exhibitions, performances and publications of works in the arts, humanities or social sciences;
  5. exchange with other countries or organisations or persons therein knowledge end information respecting the arts, humanities and social sciences; and
  6. arrange for representation and interpretation of Canadian arts, humanities and social sciences in other countries.

Briefly, those are the objects of the Canada Council. It is financed partly by the Canadian Government and partly by private interests. As I said, the Canada Council is similar to the British Council - in a much smaller way of course - and the India Council. Other countries, such as Sweden, have equivalent organisations. They do not deal with anything as vulgar as trade or as sinister as diplomacy, but there is no doubt whatsoever in my mind that exchanges of a cultural nature do have a bearing on diplomacy and do have a bearing on trade, ultimately. Therefore they have a bearing on our relations with nations in the part of the world in which we live.

We are most interested in building bridges between ourselves, with our way of life, and the peoples of the smaller countries of Asia. 1 believe it is vital for our survival that this be done and be done quickly. Geographically we are in the Asian sector of the world and it is time for us to consolidate our position. We have been most generous in giving foreign aid to newly emerging countries in Asia and we have been most self-sacrificing in helping those countries defend themselves against agression. It is time we set out to help them in another way and in helping them we will be helping ourselves in several different directions because this will be a two-way business. Closer contact with the ancient cultures of Asia will help us very considerably in our own attitudes and outlook. I believe that to establish an Australian council is a challenge for us. We need such a council at this particular time in our history primarily because of the defence situation, but also because we are becoming a sophisticated country. We have reached the stage in our career as a nation when we can go ahead and develop a degree of sophistication in our affairs and become more truly a nation than we have ever been in the past. We have a contribution to make to the world and this is the medium through which we can make it.

I put to the Government seriously the hope that consideration will be given in the coming weeks and months to the establishment of the three councils that I have suggested tonight - a national development council to marshal our resources and channel them whenever possible into reproductive works because we are realising more and more that capital is scarce; a productivity council to ensure that we have the highest degree of efficiency in our Australian industries, and an Australian council to bring together and focus the Australian way of life and project it beyond our shores. I believe each one of those councils is vital to Australia’s continued survival and progress.


– The Budget, as presented to the House, is unique for creating, as it does, a record sum for expenditure. The Treasurer (Mr McMahon) is to be congratulated on the great care and precision with which he has presented the Budget and related statements and accounts to the House. If compared with the article read by the Leader of the Opposition (Mr Whitlam), it is quite evident that on the one hand we have the master of the situation, knowledgeable, keen and enthusiastic, presenting a budget which will stabilise the economy and at the same time allow for steady progress and improvement in the economy; on the other hand, we have a diatribe of ineffectual criticism from the man of destiny who, like many such people, cannot grapple with economic and financial matters. So, on this occasion, he had his henchmen prepare his speech, and though it was a slight improvement on his previous efforts it left much to be desired as an intelligent approach to and appreciation of the situation.

I think it is appropriate that we should recall that a year ago the Treasurer presented his first Budget. For the previous five years economic expansion had continued, despite the 1965-66 drought. Over that fiveyear period employment had increased by 600,000, immigration had increased our population by 400,000 and the net capital inflow amounted to a staggering $2,500m. The Treasurer estimated that there would be a possible rise of about 3% in employment from local increases and from immigration.

The actual rise was 21%. The building industry had shown sluggishness, but an injection of $22m in March last year supplied the necessary impetus, and the building industry has been reasonably stable throughout this year. In respect of consumer spending the rate of. increase had decreased in the years preceding 1966. This was aggravated by the drought in New South Wales and Queensland. There was a fall in output. Employment in a large number of industries which produced consumer durables and employment in manufacturing as a whole rose very little in .1965-66. Despite the doubts of the financial writers who conceded at the time that the Treasurer might prove right - they were gracious enough to admit this - the economy did respond as the Treasurer had intended under his 1966 expansionary Budget. There was strong and varied growth. Public authority spending led the way, as it should do when the economy needs an impetus or stimulus. With improved seasons, rural output and incomes increased. Consumer spending revived. The gross national product in 1966-67 rose by 9%, and after making full allowance for price increases there was an overall rise of at least 5%. This was one of the best results in recent years. Wage increases were absorbed. These amounted to about 7%. Prices rose by only 2% in the first three quarters of 1966-67, which was good, but by 5% in the last quarter, which was not good. In respect of exports there were good trade results with shipments of wheat, wool and minerals. I have mentioned the foregoing, because it was the Treasurer’s first Budget. His confidence and judgment have been endorsed by the trend of events over the past year.

In the 1 967-68 Budget, now under review, total expenditure is estimated at S6,483m and total revenue at S5,887m. Excess expenditure over income is therefore $596m. This excess will be covered by borrowing. The Treasurer’s job was to keep the economy buoyant and to consider what expenditures could be increased. I think we all agree that there is a good year ahead commercially. It would appear that labour in sufficient numbers will be available and that material and plant will be in good supply. Output should be increased by the large additions in industrial plants. Rural industries are dependent on unknown factors, including seasonal conditions and world prices. It is too early to predict the outcome, but of our major primary industries wheat should prove a good income earner. Consumer spending, which is the major component of national expenditure, is again increasing. Employment should be at a higher level and we should enjoy another successful year with inflation kept within bounds.

The boom and bust cycle has been eradicated. Home building has been increasing. This is good, but I should like to see more effort in assisting the low wage earners and the young married couples to obtain their own homes. The upper salary segment is very well catered for with consumer spending high. The work force engaged on manufacturing consumer goods will be kept fully employed. I am pleased that the Treasurer and the Government have taken cognisance of one of the most definite maxims in economics - that when trade and conditions are running at a good to high level, government expenditures should be kept at a minimum. Only works of national importance and of productive value should be entered into. Wisely handled, a monetary reserve should be established to be utilised immediately some impetus or stimulus is required by the economy. Over-expenditure in the public sector would increase prices and, if not checked, inflation would follow.

I believe in good wages, but we cannot divorce ourselves from the fact that we are an integral part of world trade and conditions, and that our standard of living depends on our ability to capture a goodly share of the export market. The cooperation of workers and management is vital in this regard. Both must play their part. If this can be achieved - and it must be achieved - with both sharing equitably in productivity, our national position is improved and the stress placed upon our balance of payments is lessened. The Leader of the Opposition, in the article that he read, did not in any way shatter the Budget. He was incapable of giving credit to any. part of the Budget, no matter* how worthwhile it was.

I want to refer to a part of the Budget that has not been noticed generally and that is the provision relating to defence forces retirement benefits. This confers a substantial advantage on those gallant young men who serve in Vietnam. I was one of the originators of the idea that national servicemen should be given some insurance cover, but what the Government has done now is a considerable improvement on the original idea, which was that a life insurance policy be taken out for each national serviceman. The Government has done better than that, and I think I should read the relevant passage from the speech of the Treasurer. The Press has not mentioned the benefits that will be given to a national serviceman serving in Vietnam should he be incapacitated. No other country can equal the magnificent gesture that the Government proposes to include in legislation at a very early date. Magnificent though it is, it is only right and proper that we should protect these young men. Few are required but they are assisting many. The Treasurer said:

We propose to seek an amendment of the legislation governing defence forces retirement benefits to give common entitlements to all servicemen on full-time continuous duty for periods of twelve months or more by admitting to the benefits of the scheme those now excluded because they are enlisted for periods of less than six years. This extension of the scheme will give cover to national servicemen, who are enlisted for two years. If any of the servicemen now to be covered is discharged through invalidity or dies, he or his widow and children will receive the same pensions or other benefits as permanent members of the Forces.

While serving in special areas such as Vietnam, servicemen are, in addition, covered by the repatriation legislation. Thus, for example, a married private soldier totally and permanently incapacitated as a result of war service will receive a pension of $31.50 per week under the defence forces retirement benefits legislation, together with a basic pension of $34.55 per week under the repatriation legislation. Additional repatriation benefits are, of course, provided in respect of children and by way of medical and hospital treatment.

The legislation will be introduced as early as possible.

Although Her Majesty’s Opposition is there to oppose, it should have admitted that the Government had propounded a wonderful scheme. It is far better than the scheme that we ex-servicemen had proposed. We suggested life insurance cover, but the Government’s scheme ensures that not only is the soldier protected but, even on his demise, his dependants will receive a continuing benefit during their lifetime.

Mr Deputy Speaker, the Treasurer is to be congratulated on this, the second Budget he has presented. He knows his figures and he has had practical experience. He has presented a Budget that will stabilise the economy. However, I have one regret and that is that the needs of the pensioner on the base pension have not been considered and some increase in the base pension granted. The vast number of people who receive pensions makes it difficult to ascertain how many are dependent wholly on the base pension. But this should not be an insuperable difficulty. The Treasurer is not dogmatic. He believes that a budget should be flexible. If in the later part of this financial year we find that the economy has improved and if we are able to ascertain the number of pensioners who depend on the base pension, I trust that we will assist them.

Many pensioners seek the base pension through no fault of their own. They were born at or near the turn of the century. They endured the First World War and then in the late 1930s encountered an economic depression of a severity unknown in the Western world. This was not just a financial depression; it was an industrial and an agricultural depression of a type never before known. Having endured this, the Second World War came. These pensioners did not have the opportunity to acquire their own home, as people born in a later generation did. The Treasurer has a novel characteristic; he is one of the few people who believe that a budget should be flexible. If our economic position improves during the financial year, we should be able to give some assistance to the pensioners I have mentioned.


– The Budget for 1967-68 is memorable. It comes at a time of transition. Many fundamental changes for the better are taking place in the economy generally and the first flush of new advances is evident. There is a growing confidence in the community - a confidence that has never quite returned since the so-called horror Budget of 1961. With the return to rapid growth, there is a corresponding tension in the field of labour and industry. The nation sees itself afflicted by more and more strikes - that most reactionary approach to the improvement of working conditions. Political changes also are taking place. Despite superficial changes, such as the change in leadership and the control of the Opposition, there is still no sign of a workable alternative to the out of date Socialist and class approach that has kept Labor in the wilderness for nearly two decades. In foreign affairs, if anything, Labor seems to be going further to the left. So it is from within the Government parties themselves that the really constructive criticisms must come if the Parliament is to justify its claims to national leadership in thought and administration. Some great and sweeping changes are needed in many fields - in the fields of social services, education, trade and transport, to name only a few. But these changes must take place within the framework of a clear mandate given to the Government by the people at the last election as to Australia’s defence and external affairs position.

In short I should like in a few minutes to tender some of the criticisms that I have mentioned, criticisms which I believe are vitally necessary to give real help to many sectors of the community, especially those ones which are least able to drive hard bargains in these days of strong growth. But first let me underline some of the greater issues which must form a foundation for realistic policy in Australia in the field of international affairs. There is one overarching issue - perhaps the greatest single factor - which will affect history as it will come to be written of the decade ahead. It will be the way that the rest of the world decides to deal with the problem of Communist China. China, despite her age long history, is today the juvenile delinquent of international society. It is essential for countries such as Australia to have a clear policy towards her. It seems to me that there are two and only two real choices ahead of us. One policy - one possibility - lies in the immediate tackling of the capacity that every month sees put into the hands of the fanatical Chinese leadership, that is, the threat of nuclear aggression. Giving support to this view is the fact that Peking unceasingly stresses the need for violence and aggressive warfare. The tumultuous ideological differences between Russia and China centre on the inflexible attitude of the Chinese towards the inevitability and desirability of the use of force.

The Chinese have attempted to enlist their entire populace into a movement to make everyone a soldier. The disciples of Mao Tse-tung quote like automatons those passages of the works of their ageing leader which argue that revolutionary violence and war are necessary, desirable, inevitable and push history forward. At the same time the continuing purges and the massive indoctrination of Chinese youth through the Red Guard movement are directed towards the elimination of any other possibility than that of the violent overthrow of the alleged class and cultural enemies of the militarist new China. So there is, therefore, considerable reason to hold the view that the West should act either directly or through intermediaries to decimate China’s massive war potential before it is too late - that at least the elimination of her nuclear developmental centres should not be delayed.

There is, happily, another and, 1 believe, more acceptable method of approaching this situation. To approach this alternative argument it is necessary first to clarify one’s own philosophy or faith about man, about mankind, about human nature and about the meaning of history itself. Yet the very violence of events that are taking place inside China and have done so increasingly in the last few years, including the purging of what have apparently been some of the stalwarts of the Communist Party, lends strength to this view, which is my own view. It is based on the fact that the extremists, led by Mao. have not had it all their own way - not by a long chalk. It is now ten years since Mao Tse-tung issued his famous call for relaxation, to ‘let the one hundred flowers bloom’, which was of course followed by a purging of the first buds of this new process. Ten years ago there was evidence that a new approach on a more relaxed and saner view than the extremist Marxist-Leninist line was nourishing in many quarters in China. But more recently Mao Tse-tung and his followers have believed it necessary to sacrifice even a whole year’s academic life of the youth of the nation in order to try to capture or recapture the solidarity of the now twenty years old enthusiasm for the Communist revolution.

Why was such extremism necessary? Between 1965 and 1966 there was a massive denunciation of many of the top intellectuals of the Party, men who had given their talents and devotion to the Communist cause in China for more than three decades. The Minister of Culture was removed in 1964. In November 1965 Woo Han was attacked and other leading playwrights were denounced. The army chief of staff, Lo lui Ching, and the mayor of Peking, P’Eng Chen, were removed from their positions. An examination of the words of the purged Teng T’o, former editor of the Chinese ‘People’s Daily’, revealed that central to the objectionable doctrines which these persons were propounding was an implied criticism of Mao Tse-tung himself as an ageing, if not senile, leader who was suffering from amnesia and who was leading his people forward with senseless ‘big talk*.

Meanwhile, on the world scene outside China, 1965 had been a particularly bad year for Chinese Communist diplomacy. Honourable members will recall that the Afro-Asian summit meeting in Algiers failed to eventuate, which was a great embarrassment to China. Relations with Cuba deteriorated and there followed bitter recriminations. Soviet Russia proceeded with its international conference of Communist leaders, despite Peking’s demands that the conference be cancelled. And in North Korea, as in the Japanese Communist Party, the move was away from Mao’s line towards an increased independence. Finally, the attempted coup in Indonesia failed, and that nation reversed entirely its political orientation against the Maoists who had clearly been involved in the insurrection.

The second or alternative possibility which 1 propose and which is my own view of dealing with this question of China is two-pronged. On the one hand it means that we must do everything that we can to frustrate the military adventures of the Maoists outside of China, and at the same time we must do everything that is possible to lend support to the internal processes of change which are clearly going on inside her boundaries and her people. The act of faith, if honourable members like to refer back to what I said earlier, is that man is born for truth, not lies, and that the truth ultimately will prevail, that sanity will prove the strongest. So in pursuing the first of these two objectives, that is, of saying No to the military expansion and adventures of

Maoism, the focus of Australia’s effort lies clearly in Vietnam. It is here that a crucial battle is being fought, a battle which, if it ended in victory for Communism, would possibly set back our hopes for peace to a point of no return. In other words, we are being forced to fight a small war to prevent the outbreak of a world nuclear holocaust, just as right around the perimeter of China this same battle is taking place through Korea, Borneo, Malaya, Indonesia and, more recently, in Vietnam, which was formerly Indo-China.

It is my view that the Australian Government, with her allies, must do a great deal more than it is presently doing to make these facts absolutely clear to every Australian. We must never forget that it is possible for a long drawn out struggle, such as the one in which we are engaged in Vietnam, to go sour. As individual sacrifices appear to be overwhelmingly great compared with the lot of the majority, the question of fairness raises its head again and again and cannot be ignored. Any government which is worthy of the leadership of the nation must give thought to the ways in which the whole country can bear the responsibility and the sacrifice as equally as possible.

It is therefore critical, and I believe esential, that all people who hate the thought of a frontal clash between ourselves and the Chinese, involving, as it would inevitably involve the use of atomic weapons, should strive with every ounce of energy that they possess to see that our objectives and those of our allies are achieved in Vietnam. The only alternative would be the building up of the confidence and the overweaning pride of the Mao-ists to the point where they would venture into a major conflict. Above all at this time in the nation’s history we must see to it that we do not succumb to the kind of pernicious propaganda, based not only on exaggeration but deliberate distortion and lies and the complete reversing of evidence, which is apparent in so many quarters; the kind of literature which holds up stories of the thousands of children burned by napalm in Vietnam. I believe that every Australian has a duty to look at the facts for himself or herself. These facts are available. I myself have been absolutely surprised as I have seen these analysed not by sources that might be called partisan but those who have gone out there, sometimes under the pacificist banner, to study the facts for themselves and have come back to tell us of the small number of child victims of napalm burning. Indeed, in some cases they have been unable to find the evidence pf child victims of napalm burning and the other horrifying claims that have been put forward as the direct result of the activities of Australia and her allies. On the other hand there is that grim horrifying total which mounts week after week, year after year, of the murder and terrorism going on at the hands of the Communists in that unhappy country.

At the same time, as I said a moment ago. the other prong to our attack must be to see that the Mao-ists are prevented from expansion in the military sense; to see that they are discredited within China itself as much as possible. I agree that there is not a great deal which we at this distance can do ourselves, but the first thing that comes to my mind is the matter of trade with China by Australia and other free nations. The Chinese trade only to build up their economy where their farming programmes and other objectives internally are not realised. Although many subtle and complicated arguments - perhaps very sincere arguments - could be adduced as to why trade in wheat between Australia and China should continue, I believe it is time for a careful audit, not dominated by sectional interest or political advantage, to be made to determine the precise implications of our trade - its advantages and disadvantages. I believe that such an audit could show it to be a fundamental folly, if not a grievous double dealing, to continue along this road. The additional fact is that it does not seem to be necessary for us to trade with China, because there appear to be large alternative markets available for Australian wheat. This is a fact which I personally have tried to investigate during the recent recess. Given a new energy and enthusiasm and a willingness to question and scrutinise some of our existing methods and philosophies of marketing, it is my conviction that Australia could write a new chapter in her trading and ancillary activities.

For example, there would appear to be grave discrepancies between the frequently stated Australianism on the part of the

Minister for Trade and Industry (Mr McEwen) during his visits overseas - I applaud it - and in his recent comments on the United States and the United Kingdom and the practice of some senior departmental officers in the matter of overseas shipping. I want to take this opportunity of warning the Government and the nation of the dangers inherent in the current situation with regard to the development of container facilities and international shipping. I have taken the opportunity of informing myself, although necessarily sketchily, during the past few months, both within Australia and overseas, about some of the things and processes that are taking place in this field. I believe that we are heading fast for a complete monopoly by overseas interests of some of our vital lifelines in trade and transportation. As many will be aware, I have personally played a role, which has perhaps gone to the limits of propriety for a member of Parliament, in an attempt to encourage various shipping projects to get under way in order to bring back to Australia some of the initiative and the reward in this field.

I make the unequivocal statement that it would not be difficult to develop an overseas shipping line on a private enterprise basis in which overseas expert operators would be prepared to contribute capital and know-how through a minority shareholding, with the majority under Australian control. I have spoken with the chairmen and directors of several such companies overseas who would be prepared to engage in such an enterprise. I urge the Government here and now to make’ clear to the nation that should any proper proposal be brought forward for such a shipping enterprise which could bring to Australia some of the tremendous rewards presently going to overseas operators, it will use its best endeavours to ensure that such a company would obtain a reasonable share of the business and be safeguarded from unfair tactics employed against it by would-be monopolists. By the same token I address the same kind of plea to labour because I believe that without the co-operation of the seamen of the country - without a fair and reasonable contract that labour would be made available under these circumstances - the whole basis of the thing could be sabotaged at that point.

As I said earlier, there are several other fields where a time of growing affluence and advance, such as the present, places special responsibilities on the shoulders of the Government. In many ways the Government has already recognised this and has tried to meet the very great number of such challenges. In other areas what has been done is inadequate or is wrongly directed. Let me give an example. The time is long overdue for an overhaul of our national attitude to old age. The present schemes - in other words, the vicious choice between- the pension on the one hand and the means test on the other - are outdated and outmoded remnants of a system which is just not good enough for Australia in 1967. In the case of both pensions and the application of the means test we have the line of least resistance, that has grown out of the days of the dole and the depression, pushed to the realm of utter absurdity. The time has come for change.

Let me give the House a few examples of what in my opinion is high nonsense. We have recently had a postal strike on our hands. I have talked with a number of postal employees in an attempt to gauge their feelings and reasons for acting as they did. 1 deplore the strike weapon as outdated in a community such as ours, but what is the employer to do about a situation such as the one I shall now relate? Take a postman in a suburban post office who is the only permanent officer among five delivery officers. On appointment to the permanent staff he gets a letter stating that he is required to pay into a superannuation fund out of his salary. The temporary officers are not required to do this, although they may voluntarily contribute to a species of provident fund. As a result of his permanent appointment the first man takes up so many units of superannuation and has less takehome money each week. When he retires he is given his superannuation. His annual rate is just high enough to cut him out of the pension. As a result the permanent employee is deprived of a pension which he sees made readily available to the other men who worked alongside him for almost the same kind of wages and for which he, too, paid taxes. It would not be hard to show how the other men could have saved just enough to enable them to get the full pension and to be many dollars a week better off than the first man who became a permanent employee. This is so wrong yet so typical of the injustices under the means test. It makes a mockery of our whole approach to social services.

There is urgent need today for a greater pension in many quarters. I admit this. In how many quarters we do not know because of the circumstances - often circumstances which are hidden or incipient because of the application of the means test. I would be the first to admit that where there is real need and utter destitution, these things must be cared for first. But the answer is not in this unholy dilemma of means test versus pension. It is in the introduction of a system of national superannuation, or compulsory universal saving for old age if you like. No matter how massive, the Government must face up to the first cost of its implementation. When that is done I believe we should retain the means test, made much more strennuous than at present, to care for the very small range of people whom improvidence or disaster had rendered indigent.

The cruel injustice of the present scheme, Mr Deputy Speaker, is that it herds a vast cross-section of old people into a general category of penury. Many of them are some of the best and most frugal people of their generation and they have helped in no small measure to build the Australia of today. So, in my view, in an Australia such as ours there is no excuse for thinking of the provision for old age in these terms. Every so-called liberalisation of the means test makes the situation more absurd. Today, any single person who retires with less than $20,000 invested at an average rate of 6i% or less would be well advised to dissipate some $15,000 in order to enjoy a better income. A married man has to save more than $32,500 before he retires and invest it at 6i% or better if he is to have an income equal to that of a pensioner who, together with his wife, has saved only $10,000. In short, the married man’s effort in saving some $22,500 of his $32,500 is worse than useless, for it brings on him a financial penalty.

I believe that these are stark illustrations of the kind of problem that I have been studying so closely in my own area. Perhaps the most stark illustration of all is seen at the point where a person with a fixed income is only just excluded from any pension. Let me compare the positions of two married process workers who work side by side in industry. I shall call them Mr Smith and Mr Jones. Mr Smith has worked all his life in one job and contributes to a superannuation fund that will give him an income of $24 a week on retirement. In addition, he has saved $9,600. When he retires, he receives his $24 a week plus an average return of, say, 6% on his savings, which adds another $11 or so a week, making a total weekly income of, say, $35.

In the same factory and on the same wage is Mr Jones, who does not care to contribute to a retirement fund. He just puts aside a little and has saved the same sum as has been saved by Mr Smith - $9,600. Jones therefore receives on retirement $11 or so a week in interest, the same as Smith. Smith, however, because he gets superannuation, receives no pension on retirement. So he has to pay all his own medical expenses and forgo all the other fringe benefits. He has to pay full telephone rental, the full television viewer’s licence fee, full fares and full land rates. Jones, on the other hand receives a pension at the full rate and this brings his actual weekly income up to $34.58. In addition, he receives all the fringe benefits that go with the pension. Smith, as a reward for the thrift that he has displayed throughout a lifetime, receives a weekly income of some $35 - only about 50c more than Jones receives - but he loses all the combined benefits that he and his wife could have received in fringe benefits, which would be worth at least $5 a week.

Therefore, I believe that there is one thing at which we should look very early in the piece. That is the possibility of enabling superannuation benefits to be paid in a lump sum to those who requre money to purchase a house or make some other prudent provision for their old age. The same sort of principle could be extended more widely. For instance, I believe that in a community such as ours it is morally untenable to continue to impose a penalty on savings at any point. A start should be made with the object of giving some relief in terms of taxation to those men and women who are of pensionable age and who do not avail themselves of a pension.

Time does not permit any worthwhile discussion of some of the major fields that I have mentioned, such as education. I am very grateful indeed for the increase in our present provision for education. There is no other field internally that is anything like so important to the security and prosperity of the Australia of tomorrow. A tremendous amount is now being done by this Government. However, we should not simply be content to do more than has been done in the past, for this is a new age. It has new problems and new opportunities and it requires bold new thinking. So, just as I would fearlessly ask the nation to provide the money needed to remove inequities applying to retirement, I believe that the nation would respond to clearly defined new objectives in education. Parents want the best for their children and they are astonishingly ready to make sacrifices and pay for it if it is clearly designated and the objective is one with which they agree.

T conclude, Mr Deputy Speaker, by stating that I sincerely hope that the Government will not be deterred by thoughts of political disadvantage from seeking the kind of finances that I have hinted at in the criticisms that I have tendered. The people look to us for sane and sound housekeeping. Despite the uproar, based on spurious premises, that we have heard on all hands in relation to defence spending, one could look sardonically at the same Press journals that have offered criticism and conclude that they would have been willing to criticise on exactly the opposite tack if the Government had not made exactly the same provisions as we are now making for the equipment of our armed forces with the best available equipment of our day. The result in the Corio by-election was all very well in the context of a byelection. The same people who vote for an opposition when very little is at stake will vote solidly for a government when major questions relating to defence and economic security are at stake. We stand on the threshold of a most exciting chapter in this nation’s history and I call on the Government and on all Australians to look fearlessly at some of the areas that I have mentioned. I believe that by doing so we shall earn greater respect and trust from the great majority of the Australian people.

Mir ANDREW JONES (Adelaide) [10.46] Mr Deputy Speaker, concerning the Budget that was recently presented by the Treasurer (Mr McMahon), 1 can only concur in what the honourable member for Evans (Dr Mackay) has said about the increase in defence expenditure. For too long now, we have heard the militants and the radicals in society condemning the Government’s policy on South East Asia in general and on conscription in particular. But 1 have not heard many people praise or even give credit for the job being done by those of our young people who are serving in the Vietnam theatre of war. Whether the Government’s policy on South East Asia be right or wrong - 1 am firmly convinced that it is right - at least we can do the right thing and honour those who have done the right thing by this country. “I have not yet had the privilege of visiting South East Asia, and South Vietnam in particular, but I hope that I shall be able to do so one day.

Turning to the provision for increased defence expenditure in this Budget, 1 think of the philosophy of Mao Tse-tung who declares that might is right and that power grows out of the barrel of a gun. When one looks at the effectiveness of Communist infiltration at various points throughout the world - in Africa. Europe, especially the Mediterranean countries, the Near East, the Middle East, the Far East and even to a certain extent in Australia - one might well wonder just where it will lead us in the years to come. Some three weeks ago, I visited a Returned Services League hall in my electorate. At one end was displayed an illuminated cross of Jesus. At the other end was an oak panel inscribed with the names of those who had gone overseas to fight for Australia in the Boer War, the First World War, the Second World War, the Korean War and now the war in Vietnam. Whether or not those who served believed that they fought for the greatest democracy in the world or for the best standard of living and the greatest society in the world, they fought for one thing that we on this side of the House hold very dear - freedom. That is a simple word, but it carries a great deal of effect.

People throughout Australia are turning their attention to the cultural revolution that is taking place in Communist China today.

When we consider the evolution of the Red Guards, the opposition of the Forty-third Army by the Forty-seventh Army and what appears to be in fact a process of complete collision throughout Communist China, it seems that right through, from one perimeter to another, the Communist system in China is breaking down. lt is not my intention tonight to criticise or condemn the Opposition, but I do want to give some credit to the young people of Australia who cannot speak for themselves in this Parliament - the young people in the armed forces, the Army, the Navy and the Air Force, who are overseas defending this country and a Government which has laid down a policy which it has the guts to carry out and maintain. I do not think anybody could ever accuse the coalition Government of implementing a policy and failing to stick by it. This is one reason why I am proud to be a member of one of the Government parties.

What the position of Australia in world affairs in years to come may be no-one can foretell. We have heard a good deal about the food famine and the industrial conditions in Communist China. We know that China probably would not take on the Western world until she achieved some degree of nuclear sufficiency. We know that Mao Tse-tung would try to divert his people’s attention from China’s own internal affairs by directing it to areas outside Communist China. I think he realises, as have many Communists in the past, and as they always will in the future, that when they encounter a foe who is prepared to stand up and fight for what he believes to be right, whether in fact it is right or wrong - a foe who is prepared to back his principles with his courage - then they should tread very warily. I believe that in such circumstances freedom will always prevail.

As I have said, I wish to speak for some of the young people of this country who perhaps do not get the attention they deserve. I refer to those who serve in the military forces overseas. I can only say that the great weight of public opinion and public feeling will give these young men and young women the credit they so richly and so rightly deserve. I think the parades that are held, the expressions of good will that are uttered and the satisfaction we feel on the return of these young people to Australia are evidence enough of the esteem in which they are held.

Now I wish to turn to another subject and give a few figures to the House. The last census revealed that there are about 11.5 million people in Australia. The number of young people under .the age of thirty years is almost 6 million. In other words, about 52% or 53% of the people in this country are under the age of thirty. It is estimated that some 64% of young people change their jobs after leaving school at least twice before attaining the age of twenty-five. What I am saying now has nothing to do with party politics. It will, I hope, be of as much interest to members of the Opposition as to the Government. I repeat that some 64% of young people leaving school between the ages of fifteen and, say, twenty change their jobs at least twice before they turn twenty-five. Those leaving school fall into three main categories. The great majority go into industry, commerce and business. A minority go into the trades and a still smaller proportion to higher education, in other words universities. But what happens to young people in these early years?

A branch of the Young Liberal Movement in South Australia recently conducted a survey. We spoke to about 250 people over a period of three weeks, mostly young people between fifteen and twenty-five years of age. In almost 90% of cases the persons interviewed said they did not like their present jobs, were not sure what they wanted to do, or did hot know where they would turn next. Ninety per cent is a large proportion indeed, and when we apply it to a total of say 500,000 instead of the 250 whom we interviewed, we get an indication of the uncertainty and the disillusionment and the lack of knowledge of many young people in Australia today.

I do not want to enter into a debate on foreign affairs because I know that there are those in the House who are older and wiser than I am and who are much better qualified to speak on that subject. But I can say that in the age of the qualified man in which we are now living there are a great number of young people today who, because of their educational qualification, home, background or schooling, or because of themselves, do not know which way to turn next. Industry spends approximately $150m a year on advertising purely to fill positions. Each day every newspaper in Australia carries a number of pages of advertisements showing positions vacant. Each day every newspaper makes a lot of money out of advertising. For the last sixty years, in fact since the beginning of time, industry has had to make its appeal to the majority of Australian people in this form. But if one speaks to members of the chambers of commerce or chambers of manufactures, or to business leaders, industrial leaders, social economists, philosophers, psychologists, personnel officers or members of the trade union movement, one finds that all of them agree that there is a great problem facing Australia today. I mention Australia because I know Australia. But it is true to say that there is a great problem facing the world today.

As our levels of society and of sophistication rise, so also does the number of job applications. So also does it become easier to change an occupation. In other words, the grass in the other field looks just that much greener. If honourable members on both sides of the House knew of the catastrophic effects this has had, they would be rather surprised. I wish to refer to what the honourable member for Evans mentioned earlier tonight and to take a hypothetical example to prove one point which I hope will be clear to honourable members when I have concluded. Let us assume that I am a personnel officer for a large company, that I put an advertisement in a newspaper which costs me approximately £15 over a two day period, that I spend a whole day interviewing six or seven applicants, that at the end of that day, or by the end of the week, I have worked out in my own mind the person whom I want to have on my staff, and that I send him a letter telling him that he can start work on the following Monday.

Now let us trace the course of events associated with this young man. First £15 has been spent by the company, whatever sort of company it may be - there are over ten thousand companies operating in three States alone - and the personnel officer has spent a whole day in interviewing prospective personnel. The young man starts in this job at the age of sixteen years. He works perhaps as a mail boy., then as a clerk, and is transferred through four or five different departments, depending on the size of the company. At the age of twenty-one - I am sure this hypothetical case can be applied lo approximately 90% of the population - be sits down and thinks to himself: ‘Am I getting as much out of life as I can? So and so has a much better job than I have. He has no better qualifications than I have.’ So the rot sets in. Over 64% of the young people in this country have changed their jobs twice before they reach the age of twenty-five.

This is a serious matter indeed. At the age of 21 - sometimes earlier, sometimes later - young men say to themselves: ‘1 would like to go into something else’. Let us assume that the young man is successful in his further application and that he then goes into another field of business. By now the company that he has left has spent five years of time, five years of labour and five years of salary training this person who, it hoped, would be of advantage to it- at a later stage. But it has lost this person. Consequently, he becomes one of the 64% of Australia’s floating work force. I have mentioned the case of one person only. If we allocate to this .person the sum of £800 to £900 a year as salary and multiply it by li million we get an idea of what industry is paying to keep this 64% of the workforce who change their jobs every twenty-five years.

Mr Peters:

– Industry makes a profit out of them each time it employs them.

Mr Andrew Jones:

– This is not a joke. It happens to be an important problem. If the honourable member does not recognise that now he will have to do so in the next few years. Let us assume that a person is looking for a job. If we multiply this one person by one and a quarter million we get a rough indication of how many people are changing their jobs every financial year. If we total this up in terms of industry it works out at something between $500m and $700m which is being wasted each year by companies unable to hold their staff. I will continue my remarks in the face of objections from honourable members opposite. They do not know what I am talking about anyway. -

I come now to my main point. I will not bore honourable members opposite with a lot of tedious details because I do not think that they have the capacity to understand. For the benefit of honourable members on my own side of the House I point out that today the Department of Labour and National Service operates a very good service throughout Australia. The Department operates services which are specially orientated lo assist young people. It handles Army call-ups. lt also has an industrial services branch. Ii has a branch for reestablishment of people in civilian life, lt has a co-ordination service, a guidance section and an employment branch. There are fifteen such branches in South Australia alone. The Department provides professional employment advice to managers, ft has a service for graduates, a British undergraduate scheme and a section for handicapped persons. In short, the Department of Labour and National Service acts as the agent between the employer and the man.

When I left school the last place to which I thought of turning was the Department of Labour and National Service. I had an idea of what I wanted to do. just as I think most people have. But the services that are being offered by the Department of Labour and National Service today in .ill capital cities and in the various regional centres in each Slate are very good indeed. However, I do not believe that knowledge o! these services is getting across. 1 do not believe there is enough interest shown by students, either before they leave school or afterwards, in the Department. In fact. I do not think we are getting quite as much out of the young population of Australia today as we possibly could.

Honourable members will remember that I spoke of the terrific drain and of the wastage of money in trying to cater for the 64% of the work force who are unemployed and who change their jobs twice before they reach the age of twenty-five years. My proposition is simply that in order to live in a modern world, in order to cater for young people’s ideas, and in order to approach young people, we have to accept, whether we like it or not, that young people are here to stay. Young people represent 53% of the population, after all. Would it not be possible to give a section of the Department of Labour and National Service a bit of a face lift, perhaps even to transfer the office from the main building in which it is housed to a central place in the capital city and make a direct approach - even more so than is being done at the moment - to the school leavers and the young people in society today? We as a nation should show that we are interested in giving more than lip service to our young people. I am not saying that this is all that is given at the moment but I consider that the Government should prove that it is interested by setting up a department, or sub-department, solely with a view to attracting young people. If this were possible I am sure that the Department would get the co-operation of industry generally. A department or subdepartment of this type could perform the functions I am about to mention. Firstly, it could provide an advisory service and career service for children still at school. This is already being done.

Mr Bryant:

– That is not so.

Mr Andrew Jones:

– As the honourable member for Wills (Mr Bryant) will agree, the school leaver, not by compulsion but automatically, could go straight to the Department of Labour and National Service special youth division, or something like that, with a view to seeking advice on the career of his choice. Earlier I mentioned that 64% of young people changed their jobs at least twice before they reached the age of twenty-five. That is more than half the young people in Australia. Everybody in this House will agree that if this figure could be cut and the position improved, this would be a benefit and an advantage to everybody in Australia. It would be an advantage to the economy. It would certainly benefit the community as a whole. It would greatly assist industry.

Mr Donald Cameron:

– We need stability.

Mr Andrew Jones:

– The honourable member for Griffith (Mr Donald Cameron) has hit the mark. We need greater stability.

Mr Peters:

– It is a pity that the Government does not have stability.

Mr Andrew Jones:

– I will disregard that typical remark from the honourable member opposite. Such a department should be set up purely to cater for the needs of young people. I do not mean that the department should be set up in some fourth floor dump in the middle of Grenfell Street, halfway through Adelaide. Most young people would not know where the department was. I am not criticising the Department of Labour and National Service in that city. If a tangible, direct approach were made to young people by setting up such a department, right slap bang in the middle of the main street if necessary, after some years everybody leaving school would automatically go to the youth guidance section of the Department of Labour and National Service, and the people there would advise them about careers.

During the recess I spoke, in Adelaide, to some members of the Chamber of Commerce and Chamber of Manufactures and people from fifteen different companies about this subject. If such a department were formed, if the Commonwealth were able to see its way clear to form an office as soon as possible with a specific view of assisting young people, all industry would co-operate. As the honourable member for Griffith has just said, we need stabilisation. The reduction of this figure of 64%, which I quoted earlier, would have a great effect on industry and the overall employment position.

What I have said tonight is probably nothing new. To harness the qualities of our Australian youth - and I believe that we have the greatest youth potential that any country has ever had - and attract young people, and benefit the economy, industry, big business and small businesses, the trades and the universities, we need the creation of such a sub-department, which would greatly assist in this direction. Even the honourable gentleman opposite me, in the grey suit, would probably agree if he took the trouble to listen to what I am saying. I earnestly ask the Government to consider something in the nature of a facelift. I have spoken to the Minister for Labour and National Service about this, I do not say that the Government is not now doing a lot, but it could do more.

I should like to quote one more hypothetical case. If a department of this type worked, if it got off the ground, if it had the appeal which I envisage - and I believe it would have, and also that it would have the co-operation of Australian industry - then Australian industry would save not only in the field of advertising for employees but also through staff stabilisation and a greater degree of security and certainty in the employment for the young. Such a department, I repeat, would get the cooperation of Australian industry. If the right vocational guidance officers and the right employer counsellors were working in a department of this type, not only would the government of this country benefit, but also the Opposition, especially those members of the Opposition who have come up through the trade union movement. Business, both oig and small, would benefit. In fact, such a department, if properly run and properly organised right from the very start, would have the whole of Australia behind it. We would lead the world because we could show that we were the first country ever to make a tangible approach to this subject and to offer tangible assistance to the young people in this nation.

Debate (on motion by Mr Collard) adjourned.

page 491


North Sydney

– I present the second report of the Printing Committee.

Report - by leave - agreed to.

page 491


Bill returned from the Senate with amendments.

page 491


Bill returned from the Senate with an amendment.

page 491


Bill returned from the Senate without amendment.

page 492


The following answer to a question upon notice was circulated:

Oil: Royalties and Search Subsidies (Question No. 124)

  1. Can he say what are the rates of royalty paid by oil companies and other groups exploiting flow oil and natural gas reserves in the main producing areas throughout the world?
  2. What incentives have been paid or are being paid to companies to encourage their participation in oil and gas search?
  1. Royalty is the payment made by the con.cessionnaire in consideration for the right of exploiting any petroleum in the area of his concession.

It is imposed in many forms; the payment may be made as a percentage of profits, or as part of production in kind or in cash usually based on value of production. In some agreements provision is made for a minimum amount of royalty; in others rates vary according to the level of production or distance from marketing point

Some specified royalty rates are:

Royalty cannot be viewed in isolation when considering the payments made by companies to a country for the right to exploit its natural resources. Comparisons between countries of the benefits accruing from the exploitation of petroleum resources must take into account all other payments besides royalty, e.g., income tax, rents, allowable deductions from taxable income, initial payments for concessions, concessional sales to host governments, individual State imposts, tariff concessions, etc. It is also common, in the main producing areas outside North America, for concession agreements to provide for an overriding SO/50 sharing clause so that the host governments get (including royalties, taxes, etc.) at least 50% of profits; some agreements contain provisions for the government minimum to be as high as 57% of profits. This compares with the Australian position of generally 10% royalty, based on well-head value, plus company tax of 42.5% on profits (after writing-off exploration and development expenses).

Moreover royalty rates have to be viewed In relation to attractiveness (including the markets possibilities) and need of a country to promote petroleum exploration. Australia for instance provides a difficult environment for petroleum search but its geographical location makes discovery of great importance.

  1. There are very few instances of cash incentives to companies searching for petroleum. Actually, the position is the reverse in the socalled oil exporting countries and, in general, the companies have to come up with more and more attractive proposals to obtain the rights from governments to search for and develop petroleum reserves, particularly in the Middle East and North Africa.

However, income tax concessions or other indirect fiscal relief are often offered by governments anxious to maintain local production or In whose countries little or no petroleum has been found and incentives are considered necessary to encourage exploration. In the United States a depletion allowance of 27.5% of gross income is allowed (it must not, however, exceed 50% of net income).

In France, percentage depletion allowance on exploitation income amounts to a maximum of 27.5% of gross income or up to 50% of net Income. It is conditional on re-investment, during the five following years within France or the French Union, in exploration or purchase of shares of other companies engaged in oil exploration within France or the French Union.

It is my understanding that the only governments who have been providing direct financial assistance to companies m the search for petroleum are the Australian and South African Governments. This assistance in Australia in the last decade has been provided under the Petroleum Search Subsidy Acts 1957-58 and 1959-64. In

South Africa the Government set up at the end of 1964 the Southern Oil Exploration Corporation (SOEKOR) and allocated an initial sum or RIO million (SA12.5 million) from the Strategic Mineral Resources Account to finance the company’s exploration activities and to provide financial and technical help to private concerns engaged in the search for oil. (There are now more than a dozen private companies with oil-prospecting rights in South Africa and in South-West Africa).

House adjourned at 11.14 p.m.

Cite as: Australia, House of Representatives, Debates, 24 August 1967, viewed 22 October 2017, <>.