House of Representatives
25 August 1970

27th Parliament · 2nd Session

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

page 427



Mr GORTON presented the following petition:

To: The Honourable, the Speaker and members of the House of Representatives in Parliament assembled.

The humble petition of residents of Higgins Electorate, respectfully sheweth:

Lt has been scientifically established that the Red Kangaroo, largest marsupial in the world and our national symbol, has through drought and uncontrolled shooting been reduced to a numerical level where, if the shooting is not stopped, the animal will become extinct in large areas, if not throughout Australia.

We, the residents of this nation, want the kangaroo to be part of the Australian landscape. We believe that tourists, who are playing an increasing role in the national balance of payments, want this too, and in this respect we believe that the kangaroo is worth more to the national economy alive, than dead.

Now that the Government has formed a Select Committee, it can be logically assumed that, fearing restrictive legislation in the future, shooters will intensify their efforts to obtain as many ..– as they can, while they can.

We, your petitioners, therefore humbly pray that you will:

  1. Immediately ban the export of products made from kangaroos.
  2. Strongly urge the State Governments to ban the shooting of kangaroos, at least until the Select Committee has made its investigations and recommendations.
  3. Make an addition to the Constitution giving the Commonwealth Government power to act to safeguard any species of wildlife in the nation that is endangered through any cause.

And we your petitioners, as in duty bound, will ever pray.

Petition received.


Mr SNEDDEN presented the following petition:

To: The Honourable, the Speaker and members of the House of Representatives in Parliament assembled.

The humble petition of residents of the State of Victoria respectfully sheweth:

That because of uncontrolled shooting for commercial purposes, the population of kangaroos, particularly the big red kangaroo, is now so low that they may become extinct

There are insufficient wardens in any State of the Commonwealth to detect or apprehend those who break the inadequate laws which exist.

As a tourist attraction, the kangaroo is a permanent source of revenue to this country.

It is an indisputable fact that no species can withstand hunting on such a scale, when there is no provision being made for its future.

We, your petitioners, therefore humbly pray, that:

The export of kangaroo products be banned immediately, and the Commonwealth Government take the necessary steps to have all wildlife in Australia brought under its control.

Only a complete cessation of killing for commercial purposes can save surviving kangaroos.

And your petitioners, therefore, as in duty bound will ever pray.

Petition received


Mr FOX presented the following petition:

To: The Honourable, the Speaker and members of the House of Representatives in Parliament assembled.

The humble petition of residents of the State of Victoria respectfully showeth; That because of uncontrolled shooting for commercial purposes, the population of kangaroos, particularly the big red species is now so low that they may become extinct.

There are insufficient wardens in any State of the Commonwealth to detect or apprehend those who break the inadequate laws which exist.

As a tourist attraction, the kangaroo is a permanent source of revenue to this country.

It is an indisputable fact, that no species can withstand hunting on such a scale, when there is no provision being made for its future.

We your petitioners, therefore humbly pray, that

The export of kangaroo products be banned immediately, and the Commonwealth Government take the necessary steps to have all wildlife in Australia brought under its control.

Only a complete cessation of killing for commercial purposes can save surviving kangaroos.

And your petitioners, therefore, as in duty bound will ever pray.

Petition received.


Mr KEITH JOHNSON presented the following petition:

To the Honourable the Speaker and members in Parliament assembled.

This petition from certain residents of the State of Victoria is to sheweth that because of the uncontrolled shooting for commercial purposes the population of kangaroos, particularly the ‘big red’ species, is now so low that they may become extinct. lt is an indisputable fact that no species can withstand hunting on such a scale when there is no provision being made for its future.

The petitioners pray that the export of kangaroo products be banned immediately and that the Commonwealth Government take steps to bring control of wild life under its jurisdiction. Only a complete cessation of killing for commercial purposes can save surviving kangaroos.

Your petitioners as in duty bound shall ever pray.

Petition received.

Social Services

Mr COHEN presented the following petition:

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The Petition of the undersigned citizens of New South Wales respectfully showeth.

That due to higher living cost, persons on Social Service Pensions, are finding it extremely difficult to live in even the most frugal way.

We therefore call upon the Commonwealth Government to increase the base pension rate to 30% of average weekly male earnings, plus supplementary assistance in accordance with A.C.T.U. policy and by so doing give a reasonably moderate pension.

The Average Weekly earnings for adult male unit wage and salary earner means the figures issued from time to time by the Commonwealth Statistician and published quarterly.

Your Petitioners most humbly pray that the House of Representatives in Parliament assembled will take immediate steps to bring about the wishes expressed in our Petition; so that our Citizens receiving the Social Service Pensions may live their lives in dignity. And your Petitioners as in duty bound will ever pray.

Petition received and read.

Social Services

Mr LIONEL BOWEN presented the following petition:

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The Petition of the undersigned citizens of New South Wales respectfully showeth. That due to higher living cost, persons on Social Service Pensions, are finding it extremely difficult to live in even the most frugal way.

We therefore call upon the Commonwealth Government to increase the base pension rate to 30% of average weekly male earnings, plus supplementary assistance in accordance with A.C.T.U. policy and by so doing give a reasonably moderate pension.

The Average Weekly earnings for adult male unit wage and salary earner means the figures issued from time to time by the Commonwealth Statistician ami published quarterly.

Your Petitioners most humbly pray that the House of Representatives in Parliament assembled will take immediate steps to bring about the wishes expressed in our Petition; so thai our Citizens receiving the Social Service Pensions may live their lives in dignity. And your Petitioners as in duty bound will ever pray.

Petition received.

Social Services

Mr STREET presented the following petition:

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The Petition of the undersigned citizens of Victoria respectfully showeth.

That due to the higher living cost, persons on Social Service Pensions are finding it extremely difficult to live in even the most frugal way.

We therefore call upon the Commonwealth Government to increase the base penton rate to 30% of the Average Weekly Male Earnings for ail States, as ascertained by the Commonwealth Statistican, plus supplementary assistance and allowances in accordance with A.C.T.U. policy and adopted us the policy of the Australian Commonwealth Pensioners’ Federation, and by doing so give a reasonably moderate pension’. Your Petitioners most humbly pray that the House of Representatives in Parliament assembled will take immediate steps to bring about the wishes expressed in our Petition: so that our citizens receiving the Social Service Pensions may live their lives in dignity.

And your Petitioners as in duty bound will ever pray.

Petition received.


Mr McIVOR presented the following petition:

To: The Honourable, the Speaker and members of the House of Representatives in Parliament assembled:

The humble Petition of the undersigned members of the Footscray Sub-Branch of the Returned Services League respectfully sheweth:

That the Repatriation Act and the Repatriation (Special Overseas Service) Act are in need of extensive review.

That various War Pensions are not sufficient for the pensioners to support themselves.

That hospital benefits for ex-servicemen should be reviewed.

That the present funeral grant payable is insufficient.

Your petitioners therefore humbly pray:

  1. That an independent Non-Parliamentary Committee be set up to completely review the Repatriation Act and the Repatriation (Special Overseas Service) Act operations, and all their provisions and to make appropriate recommendations to the Government.
  2. That there should be a General Review of War and Service Pension rates. That in this review the Special Rate T.P.I. Pension should be increased to an amount equal to the present Minimum Wage, the 100% General Rate and . War Widows’ Pensions should be increased to an amount equal to 50% of the Minimum Wage, and that all other pensions and allowances should be increased proportionately.
  3. That Repatriation hospital, medical and pharmaceutical benefits should be extended to all returned ex-servicemen of the First World War and the Boer War without the necessity of establishing any connection between the disability or the illness and wat service.
  4. That the Funeral Grant be increased from $50 to $130.

And your petitioners, as in duty bound, will ever pray.

Petition received and read.

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– I direct a question to the Minister for Immigration. How many migrants arrived in Australia during each of the last 2 years? What is the Government’s immigration programme for 1970 and 1971? What is the basis of this programme? Will the programme be affected by the results of the 4 major studies which the Minister has just announced?

Minister Assisting the Treasurer · FLINDERS, VICTORIA · LP

– The total number of new settlers who arrived in Australia for the year ending June 1970 was 185,000 and for the previous year 175,000, that is to say, a total of 360,000 for the 2-year phase. The objective of the programme during the course of the next 12 months will be to hold the immigration programme at this favourable level. This means that during 1970-71 the number of new settlers arriving in Australia will, according to our target objective, be 180,000 which is the average figure for arrivals in the past 2 years although of course it is less than the record figure achieved during the year ending June 1 970. This programme was recommended by the Commonwealth Immigration Planning Council and is based upon an appreciation of Australia’s national needs and objectives, the availability of suitable settlers for Australia and our capacity to effectively integrate those people who come here. The programme will be subject to review during the course of the coming year as it has been in the past and the results of the 3 major studies which I recently initiated will naturally be taken into account because the objective of those studies is that information should be available to the Government on a progressive and phased basis.

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– My question is addressed to the Postmaster-General. Is the Postmaster-General aware of widespread unemployment among writers, artists and technicians engaged in the television industry in Australia? If so, will he advise the House of recent considerations by the Australian Broadcasting Control Board of the quota of Australian programmes to be shown over the next 4 years? Will the revised quotas be debated by this House before they are implemented?

Postmaster-General · PETRIE, QUEENSLAND · LP

– I know that comments are made from time to time by certain sections of the industry concerning substantial unemployment in the industry. I think it is necessary to recognise that although the Actors Equity Association of Australia has a membership of some 4,000 people not all that number - and this has been indicated to me by the Secretary of Actors Equity - would be really suited to television acting. The same principle would apply - perhaps to a lesser degree - to radio acting. Therefore, to use the membership of Actors Equity as an example of the number of employable people in the industry would be a fairly substantial exaggeration. I am not aware of substantial unemployment in the many areas of the industry to which the honourable member has referred.

The Broadcasting Control Board has a responsibility under the legislation passed by this Parliament to determine the standards of programmes and of advertising. It has detailed the standards in relation to programme content. In relation to television it has determined that 50% of the programme content shall be Australian and that 18 hours in a 4-week period shall be televised between 7 p.m. and 9.30 p.m.. including 2 hours of Australian drama. When it is considering the matter the Board consults the parties who are associated with the industry to determine the employment situation and the capability of the industry to meet a particular requirement. At the same time it consults the station management because there is an economic aspect associated wilh this matter.

I would remind the honourable member that some Australian drama programmes cost anything between $16,000 and $20,000 for a 1-hour episode. This has to be compared with the cost of imported programmes, which is in the vicinity of $4,500 or $5,000 an hour, lt is very difficult for stations in Australia to sell off programmes. Country stations are unable to pay very high fees for programmes. There are only 3 networks and it is very difficult to sell off programmes within Australia. lt has nor been easy, except in isolated cases, to sell off on the overseas market. I would like to sec more Australian programmes sold on the overseas market. I believe that this would help to relieve to some degree the very high production costs of Australian programmes. 1 understand that the Broadcasting Control Board is at the moment, in one of its periodic reviews, considering this question of the quota of Australian programmes on television. I am not sure when it will let me have a report but 1 do not think that it will be earlier than within the next month or two. It is a matter for the Parliament to determine whether the Board’s report will be debated. Procedures will be available to honourable members. The report will not come to me in the form of a report which T would table in the Parliament and on which a debate would automatically ensue.

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– I ask the Prime Minister a question in his capacity as Minister representing the Minister for External Territories. I understand that during the recent evictions at la Palik, which the Administration calls Japlik, officers of the Administration destroyed and burnt a total of 9 houses. 1 am not asking the right honourable gentleman about the legal aspects of the matter, since an officer of the Public Solicitor’s office has inspected the sites. However, I do ask him what steps have been taken to accommodate the families which, I am told, were left to shelter under the trees.

Prime Minister · HIGGINS, VICTORIA · LP

– The honourable member is talking about action which was taken to eject unauthorised squatters from land which had been acquired by the Administration for the purpose of distribution, through application to a land board, to Tolai and Baining people. It is quite true that a number of unauthorised squatters entered upon this land and built themselves shelters while they were there. They had to be removed, and the shelters were also removed. I have had no intimation wilh any veracity behind it that I can check that people had to shelter under trees, because as I understand it these squatters came from villages round about and returned to those villages after that.

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– I ask the Minister for Labour and National Service: What has been the response to the call by the Australian Council of Trade Unions for a national stoppage today?

Minister for Labour and National Service · BRUCE, VICTORIA · LP

– There has been some extraordinary confusion in the trade union movement, in the Press and among the public as to what was called for. Apparently there was a call by the ACTU Interstate Executive for protest rallies in combination with pensioners. In some way which has noi yet been able to be identified, this was allowed to be thought to be a call for a national strike. There has been confusion among unions, among union leaders and as between the industrial wing of the Labor movement and the political wing of the Labor movement. There has, I believe, been very real conflict between leaders of the trade union movement. This in itself is a pity. One of the interesting things about this and something which I have not yet able to determine is the role of the leader of the Opposition. I do not know whether he was a leader of the call for the strike rallies or whether he was a follower. No doubt in his own good time he will make that clear. I. presume that he will wait until he knows the outcome of today’s events before declaring himself.

There are in Australia more than 4,000,000 wage and salary earners. Slightly fewer than 2,000,000 workers are affiliated to the Australian Council of Trade Unions, the Australian Council of

Salaried and Professional Associations and the Public Service unions. The numbers at the rallies that have been held in the capita] cities today have, as reported to me, amounted to several thousands. This is about 0.5% of salary and wage earners in Australia. Powerful speeches have been made by a number of people. As they have made their powerful speeches they have looked out over a great many people and have no doubt misled themselves into the belief that this has been a powerful protest, very solidly supported. The facts suggest the reverse. It was not a powerful protest and it was not strongly supported. I think it can be categorised only as a triumph for common sense among the Australian people over the irresponsibility of the call that was made to them.

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– Has the attention of the Minister for Shipping and Transport been drawn to a statement inferring that the passenger ship ‘Empress of Australia’ has been used to ship potentially explosive cargoes? Does his Department appreciate the serious risks involved in carrying explosive compounds on a passenger ship? What action is being taken to ensure that the practice is discontinued?

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

– lt has been reported to me that there were some voyages of the Empress of Australia’ on which dangerous cargoes were carried in normal containers without those containers being specifically marked. The way in which this happened and the extent to which it happened are now under investigation. To the extent to which the Australian National Line has laid down procedures, these have been brought to the notice of shippers. The ANL is introducing new inspection procedures to try to ensure that there shall be no carriage of explosive goods in unmarked containers. There are restraints on the carriage of explosive goods in passenger ships but the difficulty in this instance seems to lie in the fact that there was no outward indication of the contents of the cargo. The way in which this happened and the extent to which it happened are now matters currently under investigation. When I have some knowledge about this I will be glad to bring it to the attention of the honourable member.

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– My question which is directed to the Minister for Labour and National Service, is supplementary to that asked by the honourable member for Henty. In view of the latest blatant, politically motivated and irresponsible strike action initiated by Mr Hawke, President of the Australian Council of Trade Unions, and bearing in mind the prior announcement by the Leader of the Opposition of Mr Hawke’s intention, as well as the other recent politically motivated industrial disorders, can the Minister for Labour and National Service give any lead to decent law abiding unionists in Australia who presently have no say in such decisions, as to what action these responsible unionists should take.


– The industrial climate at the moment cannot be separated from the economic situation of the moment. The economic situation of the moment is, I believe, an excess of total aggregate demand over total aggregate supply. In these circumstances a great number of people feel that they can make demands. Having made a demand, if it is not granted they believe they can enforce it by strike action. Very often we hear the term used that people would prefer direct negotiation to arbitration. I think direct negotiation is a good thing. But when direct negotiation ceases to be direct negotiation and becomes direct demand which, if not granted, results in direct action by way of strike, then a very serious situation emerges and there is a great deal of lost time through industrial disputes.

To make the matter worse there is, I believe - and I am quite sure my belief is accurate - a competition in militancy that emerges in these circumstances. When a claim is granted as a result of use of direct action there is a competition in militancy in other areas to make bigger demands and not be prepared to negotiate them. If the demand is not met, direct action is made as effective as possible to achieve the demand. What comes out of all this is a very melancholy fact: It is the very affluence of our society and our economy which leads to the circumstances in which demands are made and enforced in the way they are. What we need to do in Australia is to come to terms with the fact that we have had full employment for 2 decades. All political parties are committed to the maintenance of full employment. What we need to do is to live in a state of full employment without having recourse to strike action on the scale that it is in Australia today because that erodes the very wealth that brings about the circumstances. My advice to unionists is to attend their union meetings, take responsible decisions and not to allow trade union leaders to use their position of power and influence to further their own political aims instead of the industrial aims of the members of the union.

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– My question is directed to the Minister for Immigration. I refer to a part Aboriginal child named Barry McKenzie who was taken out of Western Australia without his mother’s consent in April 1964. I have raised this matter by way of question several times and have been told that inquiries were proceeding. At one stage I was told that it had been referred to Interpol. Is the Minister in a position to advise the House of any later development in this matter?


– The case of the Aboriginal boy, John Barry McKenzie, to whom the honourable gentleman has referred, has certainly been a most distressing and tragic one. I can assure the honourable gentleman and the House that it is a case which has been followed most closely by myself and by my colleague the Minister for External Affairs. As the honourable gentleman has mentioned, the lad was taken from Australia in April 1964. Subsequently it was discovered that he had left the country under an assumed name by having had his name entered on a woman’s passport as the child of that woman although in fact he was not her child. Since that time the most extensive inquiries have been initiated through my Department and the Department of my colleague the Minister for External Affairs. But those inquiries have not elicited any official information about the boy’s whereabouts, his well-being or in fact his availability for return to Australia. I can tell the honourable gentleman that quite recently there have been some new developments which are as yet not clarified. As soon as these developments can be clarified, if they add any light whatsoever to the situation as it is known at present, I will certainly notify the honourable gentleman immediately as will I notify the boy’s mother in Western Australia.

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– 1 ask the Minister for Labour and National Service whether his attention has been drawn to the part the Leader of the Opposition played in cahoots with Mr Hawke in bringing about the disruption of industry today? Did the Leader of the Opposition announce the. stoppages at 1 p.m. whereas the Australian Council of Trade Unions made its decision at 4 p.m. on the same day? Is not his action political cowardice?


– -Order! The honourable member will withdraw the word ‘cowardice’.


– I withdraw it.

Mr Whitlam:

– I rise to order. Honourable members are not supposed to ask questions unless they can verify them. I realise that it is quite possible to make a personal explanation afterwards. However, in the meantime the question has been broadcast and recorded and can be reported. Therefore, I suggest that to what is quite obviously a concerted batch of questions to the Minister for Labour and National Service you should apply the Standing Orders. The honourable gentleman who asked the question is quite unable to verify the statements upon which he bases his question.


-Order! The point of order raised by the Leader of the Opposition concerning verification applies to newspaper reports. The honourable member for Mitchell is simply seeking information without basing his question on a newspaper report.

Mr Whitlam:

– Then am I to take it that you. Mr Speaker, will hold any question from this side of the House to be in order if it is not based on a newspaper report?


– No. This is the point I am making: The honourable member has not indicated to me the source of the information. The Chair does not know whether it comes from a newspaper report, from a radio report or from any other particular source.

Mr Whitlam:

– The honourable member has not verified it.


– Order! The Chair is not responsible for the source from which the honourable member gets his information. As far as I am aware, he has not mentioned any source.

Mr Whitlam:

– The honourable member is assuming certain facts. I submit that you, Mr Speaker, should require him to take responsibility for the statement of facts.


– 1 can see the honourable member’s point of view to a certain extent But if the Chair were to do that, it would be doing so in relation to almost every question asked in the House. As I said, the honourable member for Mitchell has not mentioned any source of information. He is asking a question, apparently seeking information. As I said previously, my interpretation of the standing order is that it relates to the accuracy of a newspaper report or other publication and provides that an honourable member must vouch for the accuracy of that report.

Mr Scholes:

– In his question the honourable member for Mitchell said that the Leader of the Opposition is in cahoots with another person. I ask you to rule, Mr Speaker, whether a member is entitled to impute actions to another member without being able to verify those actions.


-If the honourable member for Mitchell were to use another word to describe the relationship between the Leader of the Opposition and somebody else, I think he would be quite in order. I asked him to withdraw the last part of his question. I think the other part is in order.


– 1 do not know the time at which the Leader of the Opposition said there were to be rallies. I believe I know the time at which the Interstate Executive of the Australian Council of Trade Unions passed its resolution. 1 believe that to be in the late afternoon. 1 believe that the decision was announced after the adjournment of the meeting of the Interstate Executive, at about 6 o’clock. I will not pursue the answer any further because at this point of time the Leader of the Opposition, who is the one person who does know the answer to the question, has not indicated to me what the position is. Therefore I will not make the assumption and will leave it to the Leader of the Opposition to clarify it - perhaps by interjection now.

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– Does the Prime Minister recall telling the House on 8th April, in answer to a question 1 posed to him, that proper assistance and not just a palliative to the wool industry had a high priority with the Government? Did he subsequently describe the industry as being in a horrible condition? Is he aware that deferment of essential reformation of wool industry marketing could mean projected export losses to Australia totalling $350m in the 1970-71 season? Can the Prime Minister reconcile his own statements and the projected losses to the nation and the growers with the deferment implied, by both the Treasurer and the Minister for Primary Industry, of any urgent action to put wool marketing on a reformed basis and the substitution instead of an anomalous handout? Does this represent a victory for foreign buyers and their local representatives inside and outside Parliament? Will he intervene immediately either to put a national buyer in the field as an interim measure or to establish forthwith the authority sought by the growers in the industry?


– The answer to the first part of the question - do I remember telling the House something on 8th April - is yes. The answer to the second part of the question is yes, probably - certainly if not in a horrible position in a very difficult position indeed as regards very many wool growers. Wool growers grow different classes of wool and they are not all in the same category, but many wool growers indeed. So the answer to that is yes. The answer to the third part of the question is that I believe there could be a great deal more loss and disruption caused to the wool industry by the implementation of ineffective measures, particularly if they do not meet with the wool industry’s own considered opinions, than there could be by a proper consideration of all the factors involved. Severe damage could be caused to the wool industry by the sort of impetuous action which 1 believe the honourable member seems to be suggesting. The answer to the fourth part of the question is no, this does not represent a victory for whoever it was the honourable member thought it was a victory for.

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– Is the Minister for Health aware that some thousands of people throughout Australia are prevented by religious belief, based on a literal interpretation of the Bible, from becoming members of the Commonwealth health benefits plan? Is he aware that these, people - and I base this assertion on representations made to me in Hobart - are prepared to pay the equivalent of health scheme subscriptions into consolidated revenue in order to qualify for benefits? Can he say what effect this might have on the Government’s decision not to implement the Nimmo Committee’s recommendation that religious or conscientious objection to joining voluntary organisations such as the health scheme should be accommodated?

Minister for Health · BARKER, SOUTH AUSTRALIA · LP

– As the honourable gentleman is aware, this particular matter was covered by a recommendation of the Nimmo Committee. I should like to assure him that the Government gave it long and careful consideration before deciding to reject that particular recommendation, because one of the Government’s basic purposes in the national health scheme is to encourage people to make appropriate provision, through a system of voluntary health insurance. . to cover their medical and hospital costs. The Government provides quite substantial Commonwealth benefits as an incentive for people to do so. As the Government sees it. it would be contrary to the basic concept of the scheme if Commonwealth benefits were to be made available to persons who, for various reasons - any reasons - were unwilling (o undertake health insurance. In relation to his suggestion that these people pursue the course of action described by him. f will be glad to have that examined to sec whether it would make any difference to the situation.

VIETNAM Mr JAMES - I address a question to the Minister for External Affairs. Has the Australian Government taken any action whatsoever concerning the revelations of

United States Congressmen about conditions in the prison on the South Vietnamese island of Con Son? Further, has the Government ever taken any steps to induce the Governments of North and South Vietnam to observe the conventions relating to prisoners of war?

Minister for External Affairs · LOWE, NEW SOUTH WALES · LP

– As to the last part of the honourable gentleman’s question, I will obtain an answer and let the honourable member know immediately. As to the first part of his question, the Australian Government has responsibility for only one prisoner of war gaoled in the Con Son prison camp. Consequently an Australian representative has visited at frequent intervals in order to see whether he has been properly treated, whether he has any complaints to make and whether we can do anything to ensure that his conditions are better. The last report I received was during the course of the last 10 days. The prisoner had no complaints to make. We have ascertained that his living conditions are considered to be satisfactory. I will certainly give instruction to ensure that Our ambassador keeps watching the welfare of this gentleman and does all he can to ensure that he is properly treated.

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– The Minister for National Development will be aware of the numerous times that my colleague, the honourable member for Maranoa, and I have waited upon him requesting the Commonwealth Government, under the national water resources programme, to assist the governments of New South Wales and Queensland financially in the construction of the Pike Creek dam. Because of the delay that has occurred in making a decision-


-Order! The honourable member will ask his question. The preface is far loo long.


– Can the Minister give any information on what progress has been made and when an announcement can be expected?

Minister for National Development · DARLING DOWNS, QUEENSLAND · LP

– lt is a fact that the honourable member for Gwydir and the honourable member for Maranoa have been in touch with me fairly constantly regarding this matter. As they are both aware, at their request I met a deputation in Brisbane some time ago from the local authorities and people in the district who were interested in this developmental project. As I indicated at the time and have mentioned in the House previously, when the new water resources development programme came into operation after the Prime Minister’s announcement there were 4 projects from the previous programme left over for consideration. The Pike Creek Dam in the border rivers scheme was one of those projects. At the same time I indicated the priority that we expected would be given to the surveys which had to be undertaken in relation to these programmes. I said that the Bundaberg scheme in Queensland would be the first examined. As honourable members know, that survey was finalised and approval was given by this Parliament. I understand that work has now commenced. The second project in order of priority for consideration by the team of experts involved from both my Department and the Bureau of Agricultural Economics was the Pike Creek Dam. The third was the flood mitigation scheme in New South Wales and the fourth the York-Corrigin scheme in Western Australia.

The survey had actually commenced on the Pike Creek Dam when, as honourable members will appreciate, the question of flood mitigation in New South Wales arose as a matter of urgency and there was extreme pressure at that time to have the survey completed. This was, firstly, because of the fact that it was a continuing work, that is. some work had been undertaken over past years and if the survey had not been completed and approval given by this Government at the time there would have been a good chance that that very important work of flood mitigation in the northern rivers of New South Wales would have stopped and the work force would have dispersed. In view of those factors we had to take the survey team off the Pike Creek Dam work and send it to New South Wales on flood mitigation work. That work was completed, the flood mitigation project was approved and the team was returned to the Pike Creek Dam. The survey in connection with that work has been completed and is now in the final stage of preparation for submission to the Government. I can assure the honourable member that everything possible is being done to expedite the finalisation of the documents for presentation to the Government for consideration. I expect this to be done in very quick time.

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– My question to the Attorney-General springs from the report which the Commissioner of Trade Practices furnished to him 4 Fridays ago and which he tabled last Friday. Does he know the industry in which the main companies, after consultation with the Commissioner, had given up the agreement that they had had at the national level to preserve uniform prices and had now replaced it with a series of price agreements, each operating within a particular State? If so, will he name this industry?

Mr Whittorn:

– He cannot name a company.


– 1 am not asking for the name of a company; I am asking for the name of the industry. As I read the Act, that is not something which is confidential to the Minister. I also ask the honourable gentleman whether, in his 9 months or more as Attorney-General., he has inquired of the Liberal AttorneysGeneral in New South Wales, Victoria, Queensland and Western Australia whether they will at last sponsor related trade practices legislation as the Labor Attorneys-General of South Australia and Tasmania did some 21 years ago? If he has, what response did he get?

Attorney-General · BEROWRA, NEW SOUTH WALES · LP

– The answer to the first question is yes, 1 do know the industry concerned. The answer to the second question is that T would like to consider whether T ought to reveal it or whether it would be beyond my proper function to do so. I will give that matter my very early consideration. The answer to the third question is this: I have a pretty clear idea as to the attitude of my colleagues in States where there are non-Labor governments towards the proposals that have been made for complementary legislation. One does not persist in asking questions to which one knows the answers. T have not specifically asked the question for reasons which, 1 believe, will be apparent to my honourable friend.

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– Can the Minister for Defence say what steps are being taken to have Service representation on the committee in his Department which deals with the pay and conditions of servicemen? Is this Committee giving urgent consideration to the many urgent matters before it having regard to the special careers, risks and skills of servicemen? I mention the last matter because the Minister was reported in the daily Press last week as suggesting that the skills of Service pilots were less than those of Department of Civil Aviation pilots.

Mr Malcolm Fraser:

-The Press reports that came from a question that I answered last week did allow somebody to make the interpretation to which the honourable member has referred. I should like to say at the outset that the skill of Royal Australian Air Force pilots and of Australian Service pilots in the other 2 Services is, I believe, without equal. I am quite certain that nobody really believes that pilots in any other areas would be better skilled than Service pilots.

The point that I had been trying to make was that the jobs of people in the Department of Civil Aviation area are different from the overall tasks of RAAF pilots, and in that area that was the only point that 1 was seeking to make. May I re-emphasise 2 points? These are that the Secretary of the Department of Air had been a party to the recommendations about which I was then speaking and that the Chief of the Air Staff had concurred in the figures concerning his own pilots.

I come to the main part of the honourable member’s question. A number of decisions have come from the Defence (Conditions of Service) Committee in recent times concerning military skills - that was earlier in the year - flying pay, flight pay and a number of trade grouping decisions including the application of the Maritime Industry Award. There was an interregnum between the time the decision was made to establish this Committee and the time it began to work. I think that, roughly at this time last year, a decision was made to get this area of activity out of the Department of the Treasury and largely into the Department of Defence, but with equi valent responsibility, because the recommendations come to the Treasurer and to myself and not just to the Minister for Defence. The Committee was established late last year. It had one meeting only under the previous Secretary of the Department of Defence because he was retiring and was trying to finish some other matters. Another senior person in the Department also involved in this area had retired. Therefore, the Committee really began work when the present Head of the Department of Defence took up office in March of this year.

As a full Commitee, it has had about 20 meetings since March. Forty-eight subcommittee and ad hoc committee meetings have been held. Decisions totalling the payment of an additional $9m to Service personnel have flowed from the Committee. These have been quite apart from national wage flow-on decisions. The Head of my Department and myself are both very conscious of the need to make sure that Service personnel not only do provide adequate advice on matters that affect the personnel of the Services but also that they be seen to be providing that advice in this Committee which is, after all, a body that advises the Government. In this financial year I do not think a Committee meeting has taken place - there might have been one - at which the personnel members have not been present and been fully involved in the work of: the Committee. This is the way in which it is going to go on in the future.

page 436




– I direct a question to the Minister for Shipping and Transport. In recent weeks have there been savage increases in Australia-United KingdomEurope conference shipping freights on north bound and south bound services? Is the Government satisfied that these freight increases are justified? If not, what positive action has been taken to prevent the decision of the conference line from being implemented? Did representatives of conference lines who appeared before the Senate Select Committee on the Container Method of Handling Cargoes give assurances that the introduction of containerisation on the Australia to United Kingdom trade would prevent any increases in freight rates?


– The honourable member has asked me a question relative to 2 trades - the south bound and the north bound - between Australia, the United Kingdom and Europe. It is of interest, first of all as far as the south bound trade is concerned, that where no protection is given to British exporters as exists under the Trade Practices Act, there has been imposed a very substantial increase in freight rates which is considerably above that which is currently suggested as the rate which should be applied on the north bound route. The north bound route is the only one that comes within the ambit of the Trade Practices Act and the only one on which the Australian Government has any consultative powers. Since last April successive discussions have taken place between a body known as AESA - the Australia to Europe Shippers Association - and thi. conference. In addition to these consultations a discussion took place in Paris between a group of European wool buyers known as Interlaine and the shipping conference wherein an increase in wool freight of some 4% was negotiated. This increase was negotiated apparently with the agreement not to disagree of those who represented the Australian wool buyers and the Australian wool interests. Consequently at the subsequent discussions which took place in Australia there was a presentation of this 4% freight increase on wool and a suggestion that a 10% increase should be applied to other general cargo trades. The position of the commercial negotiations at this point of time is, I understand, that the AESA executive is to meet later on this week and will consider the last response made to it in correspondence from the Australian London Tonnage Committee and determine what action will then be taken upon it.

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- Mr Speaker, I wish to make a personal explanation.


-Does the honourable member claim to have been misrepresented?


– Yes. During question time today on 3 occasions and also last Friday reference was made to a report in last Friday morning’s issue of the Sydney Daily Telegraph’ attributing to me a statement concerning the lunch time rallies which the Australian Council of Trade Unions sponsored in the capitals today. The origin of the story comes from the conference to which I invite the Press after every Caucus meeting of the Federal Parliamentary Labor Party on Wednesday at lunch time. The understanding at these conferences is that 1 am on the record insofar as I announce decisions of the caucus or volunteer explanations or respond to requests for explanations of those decisions. The clear understanding is that everything else is off the record. If a general or an individual conference is sought by the Press or any member one has only to ask. On this occasion I left the room for a telephone talk with Mr Hawke. When I came back, to be courteous I told the Press why I had left the room. To be helpful, I. told the Press that it might be interested in a decision which Mr Hawke would be announcing later that afternoon. Sir, I do not propose to say any more on this occasion as to what I said. I am not the only person from the Prime Minister (Mr Gorton) down, who has been the subject of Press reports made as a result of a breach of confidence, understanding or ethics. It is sufficient for me to say that on this occasion, as far as I know, no newspaper reported it other than the one to which I have referred. The understanding was appreciated by every other newspaper and observed by this newspaper also for nearly 2 days.

Minister for Social Services · MackellarMinister for Social Services · LP

Mr Speaker, I ask for leave to make a personal explanation.


-Does the Minister claim to have been misrepresented?


– Yes, Mr Speaker, It was reported in the Sunday Press that recently I visited Lake Callabonna and made an important archaeological discovery. Unhappily, the report is entirely untrue. I visited Lake Callabonna in order to acquaint myself with the work of a scientific team which was operating in the district and was itself making very important discoveries in regard to prehistoric animals which had met their death some 40,000 years ago in the bed of Lake Callabonna. I cannot claim any credit whatsoever for the discovery. A more serious matter, however, is that I was also reported to have brought back ‘a carload of old bones’. This is a most serious matter because it is important for amateurs like myself who find any old bones in Australia to leave them there for excavation by competent persons. I did not bring back a carload of old bones.

My wife did bring back one small piece of bone - the tail bone of a diprotodon - which had been discarded by the investigators on their rubbish heap. She took it with the permission of the expert excavators. I regret to say - and the House will find it difficult to believe me - that the dog at home did take to that bone, which had to be retrieved from him. This shows how well the remains in Lake Callabonna have been preserved for 40,000 years.

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Discussion of Matter of Public Importance


– 1 have received from the honourable member for Bass (Mr Barnard) a letter proposing that a definite matter of public importance be submitted to the House for discussion, namely:

The withdrawal of all Australian forces from Vietnam and international action to end hostilities and undertake rehabilitation in Indo-China.

I call upon those members who approve of the proposed discussion to rise in their places. (More than the number of members required by the Standing Orders having risen in their places)


– The Opposition has raised this matter in order to draw from the Government a statement of its intentions in relation to the war in Indo-China in particular. There are many aspects of the Government’s belated scaling down of its Vietnam commitment which must be clarified. Let me state briefly the Labor Party’s policy on the commitment, as enunciated by the Leader of the Opposition (Mr Whitlam) during last year’s election compaign. This was that a Labor government would, on election, immediately notify the governments of the United States and South Vietnam that all Australian forces would be withdrawn from Vietnam. This withdrawal would then be carried out as swiftly as possible, having regard to the security of Australian troops and the need for a brief transitional period so that alternative arrangements could be made.

There was no doubt about our policy at that time, lt was clearly understood by all honourable members on this side of the House and, I believe, by the Australian electorate that if the Australian Labor Party was returned as the government all Australian troops in Vietnam would be returned to Australia by the end of June 1970. Under the policy outlined by the Leader of the Opposition there would not be a single Australian serviceman in Vietnam. This policy of swiftly phasing out the Australian commitment was condemned by the Prime Minister (Mr Gorton) during the election campaign. But the course of events in Vietnam has forced the Prime Minister to accept an incoherent and dilatory version of this policy of disengagement. On 22nd April in this House the Prime Minister made a conventional statement seeking to justify the presence of Australian troops in South Vietnam. He went on to initiate a policy of phased withdrawal - completely opposed to all his previous statements on the need to maintain a viable force in Phuoc Tuy province. The Prime Minister, who had always adhered to the thesis of one out, all out, was forced into the position of a phased withdrawal, although a leisurely and in many ways extremely risky phased withdrawal. According to the right honourable gentleman this would be begun by the withdrawal without replacement of the 8th Battalion.

Several aspects of the Prime Minister’s statement warrant re-examination in the light of what has happened in the intervening period. He said the timing of the Battalion s withdrawal would be determined by the general circumstances in the task force area. This would depend on the progress of Australian projects to assist the greater capability in the South Vietnamese forces.

The 8th Battalion was posted to Vietnam in November last year. In the normal course of posting to Vietnam the Battalion would have been relieved in

November this year, after one year’s service. The Prime Minister indicated this in his speech on 22nd April. He went on to say that whether the Battalion’s departure could be brought forward would depend on general circumstances in Phouc Tuy and the progress of Vietnamisation. It must be emphasised that the Prime Minister posed a clear alternative. He did not say that the 8th Battalion would serve its full 12 months and not be replaced. He clearly implied that the Battalion could be withdrawn before serving its full 12 months.

This was the last heard from the Prime Minister on the withdrawal of the 8th Battalion. The timing of the 8th Battalion’s withdrawal from Vietnam remained cloaked in secrecy until a cryptic statement by the Minister for Defence (Mr Malcolm Fraser) in answer to a question asked by the honourable member for Boothby (Mr McLeay) last Thursday. The Minister quoted the Prime Minister’s statement that the Battalion would be withdrawn in November or before if circumstances made it possible. He went on to say that the 8th Battalion would be withdrawn in November, culminating in a march through Brisbane on 12th November. This was the first public reference to the withdrawal date by a member of the Government. The Prime Minister had strongly indicated a possibility of pulling out this Battalion before its posting expired.

However, the 8th Battalion will have served its full term of a year before it is returned to Australia. The 900 men to be withdrawn will have received no dispensation, although it was the Prime Minister who raised the hope that their term of service in the war zone would be cut. The Government has made no attempt to explain or to justify the decision to keep the Battalion in Vietnam for the full term. It was clear in November 1969, at the time of the last general election, when Labor’s policy on Vietnam was announced by the Leader of the Opposition, that if Labor won our troops would be withdrawn from Vietnam by the end of June. It was just, as clear from the Prime Minister’s statement, since he had specifically referred to the 8th Battalion, that the phased withdrawal into which he had been forced would begin before the expiry date for the withdrawal of the Battalion from Vietnam. Yet the Prime Minister has remained singularly silent on this question in the House; but, as 1 have pointed out. the Minister for Defence, in answering a question put to him last week, pointed out that the 8th Battalion would march through Brisbane on 1 2th November next.

So the Prime Minister had strongly indicated a possibilty of pulling out the Battalion before its posting expired. However, the 8th Battalion will have served its full time of 1 year before it is returned to Australia. The 900 men to be withdrawn will have received no dispensation, although it was the Prime Minister who raised this hope. The Government has therefore made no attempt to explain or to justify the decision to keep the Battalion in Vietnam for the full term. The only conclusion that can be drawn is that the general situation in the task force area is not satisfactory and that the progress of Vietnamisation is lagging. At any rate the 8lh Battalion has been made to serve out its full 12 months virtually to the day.

There can be no doubt that hopes of an early return were raised by the Prime Minister; they have since been cruelly dashed by the Minister for Defence. It is regrettable that 900 soldiers and their families in Australia should have been exposed to this sort of psychological and emotional barrage in a year of heavy casualties in the task force area. Certainly this failure to set a firm withdrawal date and the vagueness of the Prime Minister’s statement have been felt by the troops in Vietnam. I refer to a report from the Australian Associated Press correspondent in Saigon which appeared in the Melbourne Sun’ on 1 0th August under the heading Diggers: When do we leave?’ The report stated that it had been widely anticipated by 5,300 men at Nui Dat that an early date for the Battalion’s withdrawal would bc set at its fourth battalion parade. Now the Minister for Defence has made the bald statement that it will nol be back before mid-November. This has been done without any explanation of what the general circumstances are in the task force area and what has been the progress of South Vietnamese Army units in Phuoc Tuy province. These were the determining factors of the withdrawal date. The troops qf the 8th Battalion will be kept in Vietnam to the last possible moment.

In the absence of any explanation from the Minister for Defence it must be concluded that the situation in the task force area is lagging sadly behind the Prime Minister’s expectations in April this year. This raises many implications about what the battalions remaining in Vietnam can be expected to achieve balanced against the potential hazards. In April the Prime Minister said that after the initial withdrawal further cutbacks would be made in the next 12 months if pacification and Vietnamisation succeeded as President Nixon hoped. This means that in the 12 months from the middle of November the Government will consider phasing some more troops into the overall withdrawal. By the end of 1971, according to the Prime Minister’s logic, the Government may have been able to pull out another battalion. The commitment to the end would then remain at around 4,000 combat and support troops remaining in Vietnam in 1972. This is a reasonable projection to make on the basis of the Prime Minister’s statement. It is up to the Government to refute it or state explicitly what it intends in Vietnam.

It is worth recalling that the Prime Minister’s decision to cut troop levels was made in April after President Nixon announced United States withdrawals of 150,000 in the ensuing 12 months. This would leave around 250,000 men in Vietnam by next April - about 45% of the peak build-up reached in 1968. This target was put back by the subsequent ill advised thrust by the United States into Cambodia but withdrawals have since been resumed with an objective of 100,000 out by May next year. According to present plans the Americans will have at least 50,000 of these men home by the middle of October. The first Australian withdrawal will just be getting under way by this time.

In the 2 years that America has been slashing its troop level in Vietnam the Australian Task Force and air and naval units have remained intact. The withdrawal of the 8th Battalion will cut the Australian commitment by about 12%. In the same period America will have halved its force. lt is probable that by the end of 1971 all

American combat forces will have left Vietnam. If the Government persists on its present policy lines a substantial Australian combat component will still be there. It has never been explained what the role of the remaining troops will be in the Task Force area after -the one battalion cutback. Is it intended that these troops should be used to protect the Australian training teams and the jungle warfare school announced by the Prime Minister? Will they be confined to a defensive role at the Nui Dat base? What effective South Vietnamese units will be available to support them if an aggressive role is to be maintained in the province?

It is no reflection on the professionalism or the heroism of the Australians who have served in the Task Force to question what has been achieved in securing Phuoc Tuy province. The province has been a traditional stronghold of the insurgents since the time of the war between the French and the Viet Minh. In the opinion of one observer, Professor Milton Osborne of Monash University, it is doubtful whether the level of security in the province has changed greatly since 1967 despite the presence of the Task Force. In such a context the presence of the Australians in Phuoc Tuy province becomes increasingly meaningless. This year has been a particularly bloody one with a number of mine disasters and several accidental deaths. Even on the Government’s terms it is pointless and wasteful to push the commitment any further. If anything is to be achieved by Australia to redress the mistakes and prodigious waste of the war it has to be along the lines of a political settlement directed towards the rehabilitation of the whole of Indo-China.

The Government’s reluctance to justify or even state its revised objectives in Vietnam contrasts dramatically with the reassessment of the war in the United States. In June the United States Senate voted overwhelmingly to repeal the Tonkin Gulf Resolution of 1964 which was used to justify full scale American intervention. There have also been moves by influential sections of Congress for legislative action to get all the troops out by the middle of 1971. Certainly President Nixon still has overriding authority on the timing and scope of American withdrawal. But there is a very real chance that all American troops will be out of Vietnam, at least by the end of next year.

Unless there is a swift reappraisal by the Government the pace of the American withdrawal may be so swift that the Government will be caught up willy-nilly in a whirl of events beyond its control. This would cost it the last semblance of credibility or any capacity to act with decision and independence. Even on the level of cynical calculation it is the Government’s duty to explain to the Parliament and the people what it intends for the Australian Task Force. The events of the past few months have been marked by a callous indifference to the impact of the withdrawal announcement on the men in Vietnam, and in particular on the members ot the 8th Battalion in Vietnam. This must not be repeated with the remaining troops in Vietnam. The Government’s intentions must be made perfectly clear to these men. It is too late for vague generalisations about the military situation in the Task Force area or the progress of Vietnamisation. The only objectives must be to get the troops quickly out of Vietnam and stop the needless waste of Australian lives.


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

Mr Malcolm Fraser:

– The Deputy Leader of the Opposition (Mr Barnard) said something about credibility. There was one occasion when he went to Vietnam to try to see for himself what was happening there and to make some judgment from first hand knowledge as opposed to some theory unrelated to the facts. He came back saying, as reported at a Press conference in Saigon, that the Australian Labor Party may have to have a good hard look at its policies on Vietnam. He was satisfied that there was more than just a guerilla war and he supposed it could be compared with the earlier conflict in Korea. He was satisfied that there was a large scale invasion of South Vietnam by North Vietnamese troops. These were his remarks as reported in the ‘Age’ of 27th February 1967. I do not know whether the Deputy Leader of the Opposition has been in Vietnam since but the further he gets away from that country the further he gets away from the facts and the reality of the situation. Clearly he would like a withdrawal from Vietnam unrelated to its impact in Vietnam, unrelated to its impact on allies on 2 sides of the Pacific and unrelated to its impact on the rest of South East Asia.

Every honourable member in this House would like to see all Australian troops in Australia if that were possible. But the difference between those on this side of the House and members of the Opposition is that we recognise that we just do not live in that kind of world. The Opposition wants to shut its eyes to the kind of world that we live in and wants to have all our forces here, believing that that would add to Australian security when in fact it would do a great deal to harm it and damage it over a period. Our objective in Vietnam is the same as it was: to establish circumstances in which the people of South Vietnam can work out their own future without interference, without aggression and without fear. There has been progress; there has been military progress. The 1 million men in the South Vietnamese armed forces have been improving their capabilities and accepting additional obligations, especially in the last 18 months.

There has been political progress, lt is worth noting the difference in the standards of judgment that are used. During the last world war in conditions which were never so difficult inside the United Kingdom, the United Kingdom decided that it was right to suspend a principal pillar of democracy; that because elections would be too divisive there would be no elections until the war was over. The pillar of democracy was suspended. Yet the free world demands that South Vietnam, without long experience of democratic government behind it as there was in the case of the United Kingdom, establish a democracy. It demands that elections be held throughout the country in the midst of the most frightful difficulty and turmoil that one can imagine. At the end of 1969 there were over 2’,000 villages and nearly 10,000 hamlets which had elected administrations and only 90 villages and 330 hamlets which had appointed administrations. Elected governments have been established at the national level. No government and no democracy is perfect. This is certainly true in Vietnam. But what the Vietnamese have achieved in establishing an elected regime at the national level and at the village and hamlet levels is something for which they deserve some credit. Also, in more recent times, rice production has been rising and imports this year are likely to be half what they were last year. This indicates improvement also on the economic front.

The United States of America has announced programmes of withdrawal. From a peak of 550,000 troops in November 1968 the American Government has at the moment over 400,000 troops of the 3 Services in Vietnam and according to the decisions announced this will come down to about 260,000 during the middle part of next year. But 260,000 troops remaining in Vietnam is still a great commitment. It is a very substantial commitment indeed. With those troops remaining the United States still will be supplying a very significant effort to help preserve and maintain the integrity of South Vietnam. Our commitment in proportion to our resources and our population has, of course, never been so great as that of the United States. We have announced the withdrawal of a battalion and some supporting troops. But in addition, to make it easier for the South Vietnamese to undertake the additional military obligations that will thereby be necessary for them in Phuoc Tuy province we are establishing mobile advisory training teams - certainly 12 and probably 15 teams in all - to assist the regional forces and popular force companies. The initial reports of the 5 teams in operation indicate that this programme is being successful. The jungle warfare training scheme to assist 500 junior leaders in South Vietnam will be established a little later.

I think it is pertinent to ask why the Australian Labor Party wants withdrawal from Vietnam immediately? Is it because it is tired? Is it because it is merely looking for votes in Australia knowing that everyone would prefer to have troops here if this were the responsible and proper course to undertake? Is it because it believes that South Vietnam is not worthy of protection? On what ground is it not worthy of protection as a small independent country wishing to pursue its own course? Is it on the grounds that it is a civil war? The Deputy Leader of the Opposition himself is on record as denying it is a civil war. He said that he is satisfied there is large scale aggression from North Vietnam. He said that it was similar to the conflict in Korea. If North Korea now attacked South Korea or if East Germany attacked West Germany, would the Opposition say it is just a civil war or would they say it is aggression, just as it is aggression of North Vietnam against the South?

I would have thought that what has happened in Cambodia in more recent times has revealed North Vietnamese aggression even to the most blind. While he may not be one of the most blind, this conflict certainly revealed North Vietnamese aggression to the honourable member for Wills (Mr Bryant). But the point here is that it is not a matter that concerns just North and South Vietnam. It never has been. It concerns the whole area. There has been aggression in Laos; there is aggression in Cambodia; and there is aggression against South Vietnam.

It is proper to ask: Who is obstructing the peace? There have been 41 international initiatives over the years. There has been the bombing halt, the Paris talks and the withdrawals themselves, all designed to make it easier to get a proper and sensible negotiation. Is it the South Vietnamese, the United States or the Australians who have opposed or made life difficult at negotiations? On every hand it has been the North Vietnamese negotiators or those of the National Liberation Front. Some of the people whom Dr Cairns, a possible Minister for External Affairs if there were ever to be a Labor Government, has asked to Australia to take part in moratorium discussions are representatives of the people against whom Australian troops, are fighting. Significant members on the Opposition front bench including the Opposition’s shadow Minister for External Affairs have asked representatives of the people against whom Australian troops are fighting to come to Australia and take part in these discussions.

The Deputy Leader of the Opposition had something to say about the parents and relatives of Australian troops. What would the parents and relatives of Australian troops think of a political leader in this country asking the leader of the very people against whom our troops are fighting to come to Australia? Does the Deputy

Leader of the Opposition come and try to pretend that his party’s policy in relation to these matters might lead to some sensible Conclusion? On the other hand, if the Australian Labor Party wants the North Vietnamese to win, as Senator Wheeldon does, it should say so. But the logic of all the policies it has espoused over recent years would lead or tend to lead to a North Vietnamese victory. If this is what the Deputy Leader of the Opposition and the Leader of the Opposition (Mr Whitlam) want they should have the courage to stand on their two feet in this House and say so and not hide the objective of their policies under a whole lot of mumbo jumbo designed to be palatable and popular to the Australian public but really concealing their true objectives.

Mr Barnard:

– You know that is not true.

Mr Malcolm Fraser:

– If the honourable member does not want the North Vietnamese to win is he prepared to work for the independence of South Vietnam? All of the policies of his Party, if put into effect in their entirety, would obstruct the achievement of this objective in South Vietnam. It is also worth noting that the immediate withdrawal of our troops, as the Deputy Leader of the Opposition has indicated, would involve repudiation of allies on both sides of the Pacific. The Deputy Leader of the Opposition may believe that this doss not matter. He might think that it is only a matter of one ally on the other side of the Pacific. But there are other allies in the South Bast Asian region. If we repudiate undertakings and arrangements that we have- made with countries in our own part of the world this is something that we will not be able to live down, lt is something that will stand with Australia. We cannot move away from this part of the world as other people, perhaps, can. It is important t© be a loyal and proper ally in matters in which the cause is just and in which the cause is proper, as it has been and as it is.

I have said that isolation was the only logical conclusion that comes from the policy of the Australian Labor Party. It is withdrawal from Vietnam and the withdrawal of all forces from Singapore and Malaysia. The Leader of the Opposition has been lecturing people in Singapore and

Malaysia at the very time when the United Kingdom Defence Minister was in those 2 countries beginning to work out the terms and conditions and circumstances in which there will be a continuing military presence of the three arms of the British Forces, arms which are welcomed very much by these 2 countries and by Australia as adding once again to the general security of the region and as continued acceptance of traditional British responsibility in this part of the world. But with his traditional Tack of tact and diplomacy the Leader of the Opposition chose this particular time to visit Singapore and Malaysia to say that all our troops should be out He lectured the people in Singapore and Malaysia, saying that what they want is bad for them and bad for Australia and that they should not do it. This is the sort of thing one would expect if the Opposition were in charge of defence and foreign policy of this country.

The views of the Opposition are totally unreal. How can one expect to be a reliable partner in the kind of circumstances and with the sort of policies that the Opposition would pursue? How could we expect to be effective in helping to shape our own environment if we rendered all efforts to establish and maintain security null and void by our own actions? It is all very good and it is all very easy to talk about economic aid, and assistance in trade. It is all very well to talk about technical assistance. But none of this means anything unless we are prepared to help provide general security in addition. Without genera] security, economic aid and policies of trade designed to help are worth nothing. They fall to the ground.

Sometimes members of the Opposition speak as if they are the only advocates in this country who want peace. But there is not a person in this House who does not want peace in this area and security in South East Asia. But we want a peace which does not deny what decent men stand for. The Opposition’s policies would, I believe, make that denial. We well know that there are risks in regionalism and involvement. But we also believe very strongly that there are much greater risks for our children in isolation. We believe that there will be no permanent security for Australia unless we can establish a kind of world in which there is security for all the small countries in our own part of the world. This is the background and the basis of our original commitment in Vietnam and our involvement in the region, as it has been over recent years and as it is at the present time. Quite obviously and quite clearly in the changing circumstances of Vietnam the commitment and level of our forces there remains under constant review. This will be the case. But there is no decision at the moment to make any change from the policies announced by the Prime Minister (Mr Gorton).

There is one thing that can do most to achieve a North Vietnamese victory - that is a precipitate withdrawal of Australian forces, a precipitate withdrawal of United States forces and a precipitate withdrawal of free world support for the long suffering people of South Vietnam who want to work out their own destiny in their own way. After all the years of struggle on their part and the lesser number of years of support from ourselves and others it would be tragic indeed if our own stamina and fortitude gave up when we are getting into the last stretch of this problem and difficulty. At least that is the hope, that is the belief, and that is what we are working for. If the policies of the Opposition prevail the great deal of suffering and sacrifice of recent times will come to nothing. The Opposition must believe and must understand that this would be the result of its policies if they were put into effect.

St George

– When listening to the speech of the Minister for Defence (Mr Malcolm Fraser) it occurred to me that it was strange to present the point of view that be holds and for Australia to be withdrawing a battalion from Vietnam instead of putting in a division. The whole thrust of the Minister’s argument was his great concern for the people of South Vietnam. Yet at the same time he and his Government are agreeing to withdraw Australian forces. If they were serious about the arguments they have put forward to the Australian people time and time again, this is not the time to be withdrawing forces; it is the time to be introducing more forces.

The Minister for Defence made great play of the terms of aggression. I would like it to be known once and for all whether it is aggression from the North or whether it is civil war.

Mr McMahon:

– It is aggression from the North.


– I am very pleased that the Minister for External Affairs (Mr McMahon) is maintaining a certain consistency. Paragraph 6 of the final declaration of the Geneva Conference, dated 21st July 1954, states:

The seventeenth parallel should not in any way be interpreted as constituting a political or territorial boundary.

I find it very difficult to understand how it can be regarded as aggression from the North when the General Conference on Indo-China regarded the whole territory as one territory and the division line as not constituting a political or constitutional demarcation.

Mr Jess:

– That is a new line of politics.


– It is not a new line. It has been sitting there since 1954, if the honourable gentleman had got around to reading it. We are talking about aggression in Cambodia. We on this side of the House have not denied that the North Vietnamese have been in Cambodia at any stage.

Mr Killen:

– What was Gordon Bryant saying?


– I do not think honourable members opposite should start calling the kettle black. I have here a document dated 13th May 1964. It is the message to the President to the United Nations Security Council from the permanent representative of Cambodia to the United Nations. I shall make the document available. It states:

On the same day the International Control Commission visited the site, made its inquiries and prepared reports on this absolutely unjustifiable act of criminal aggression, which is in fact a repetition of the attack made at Chantrea on 19th March 1964.

That was an act of aggression by South Vietnamese forces, but not entirely by South Vietnamese forces. The message continues:

In the course of interrogation by the members of the Commission the South Vietnamese prisoner confirmed that United States officers had taken part in these last two acts of aggression.

The United States Government made a public apology at that stage for the aggression in Cambodia in 1964.

Let us talk about aggression in Laos. For many years we have been told that all the Air Force flights out of the 4 bases in Thailand have been reconnaissance flights. It so happens that these reconnaissance planes are B52s, the largest bombers in the world, and the number of attacks in the last couple of years has been running at 14,000 to 15,000 movements a month.

I turn next to my understanding of the forces and pressure that go into the making of the United States foreign policy. As the Minister for Defence mentioned, we cannot act unrelated to our allies. I refer to this subject because for many years we have been marching to the beat of another drum. I think we should at least understand when the beat of that drum is changing. We have been all the way with LBJ and we have gone a-waltzing Matilda with Nixon: but let it be understood that our involvement in Vietnam was not the result of any purported request from the South Vietnamese Government and still less a request from SEATO. It was purely and simply a request - a direction - from the United States Administration. It was not a strategic requirement but a public relations requirement. We should be looking at what is going on in the United States, because no United States President can ignore any groundswell that builds up in that country. The anti-war movement in the United States has already compelled the retirement of one President and is forcing the hand of the present incumbent. There is little that Australia can do in this process, but at least we should try to understand it.

To put the matter bluntly, it is just as important for us to examine the motives of our friends as it is to examine the motives of our foes, otherwise we will be left, as this Government has been left on so many occasions, out on the end of a very fragile limb. Domestic considerations led the United States into Vietnam and domestic considerations will lead the United States out of Vietnam. President Eisenhower came to power on one issue. Following the 1940 takeover of China by the Chinese Communists, he argued that the Democrats had lost China. In the period between 1950 and 1954 under President Eisenhower the Republicans realised that by the 1954 election they would be tarred with exactly the same brush - that they, the Republicans, had lost Vietnam. From that period on, as a matter of domestic political consideration, the United States adopted a policy of open ended commitment to South Vietnam. It started off with aid to the French and was followed by aid through the American puppet, Ngo Dien Diem. The Americans developed from this the idea of ringing Communist China, from Korea right round to Pakistan, with a series of bases. In the domestic field the anti-Communist movement took the form of Senator Joe McCarthy, the Red baiter, whose words still echo in this chamber and around Australia.

The Government sought to obtain the support of the United States business group. We heard President Eisenhower talking about the value of tin and tungsten. Now, strangely enough, the voice of the American capitalist is being heard. The Chairman of the Board of the Bank of America, Mr Louis B. Lundberg, stated publicly:

The war in Vietnam has seriously distorted the American economy, has inflamed inflationary pressures, has drained resources that are desperately needed to overcome serious domestic problems confronting our country and has hampered the rate of growth in profits on both a before and after tax basis.

Vietnam is not a lost cause. It was a wrong cause. The Americans have come to realise it, and the Australian people have come to realise it. It seems to me that the Government has come to realise it, because one can point to the inconsistency of its policy towards Cambodia compared with the course it has adopted in Vietnam.

In the words of the proposal before the House, it is time - in fact it is past time - for the withdrawal of all Australian forces, lt is time - indeed past time - for international action to be taken to end hostilities. It is time to get on with the constructive job of rebuilding a country, north and south, that has nearly been destroyed in the ill-guided efforts to save it.

Minister for Trade and Industry · Murray · CP

– This very serious and important proposal is not before the House merely because the 3 Labor Party members who are to speak to it - no doubt more would speak if the opportunity were available - thought it was a good idea to have a discussion. Such a tremendously important proposal can come before the House only with the authority of the Labor caucus and it represents the present policy of the Australian Labor Party - the withdrawal of all Australian forces from Vietnam. Today that is Labor’s policy. Labor’s policy is based on international action to end hostilities - which may or may not bring results - and rehabilitation in Indo China. Note carefully, that no discrimination is made between rehabilitation of our allies, the South Vietnamese, and rehabilitation of our enemies, the North Vietnamese. This is the policy of the Labor Party as stated here today. What is occurring outside the House today, and what is occurring inside the House - perhaps as a distraction from what is occurring outside - reveal the Labor Party as having 2 major points of policy. The first point of policy is for action at home to approve, to encourage and to incite the forceful defiance of governmental policy.

The whole democratic system of government is based on the fact that although there are differences of opinion within a community, free elections are held, a government is elected by the majority and the laws that the Parliament passes prevail. They are not supported by all, but they prevail. Now the left wing of the unions with the left-wing leader, Mr Hawke, and the left-wing-dominated Australian Labor Party with Mr Whitlam as its voice, all combine, forcefully, by demonstrations outside, which on occasions are quite violent, by strikes and threats of strikes, to defy elected government and defy the laws of Parliament. It is clearly the policy of the Australian Labor Party today in respect of affairs at home to swing democracy from accepting the rule of the people through elections and the rule of the Parliament through laws. Instead we are to have the rule of the mob. Do not ever forget that a mob never collects spontaneously; there are always leaders at the back of the mob - the dictators, the inciters and the provocateurs. It is time today to look at those who are behind the demonstrations which, quite often, bring violence in the streets and, as one of my colleagues can testify, violence even in the homes of Australian citizens.

An attempt is being made to undermine the will of the people to continue resistance to Communist aggression.

The constant theme of the Labor Party, whether by using the Parliament for such a debate as is provoked today or by inciting the people as is being done outside today, is violent opposition to democratic government - the rule of law and the authority of the Parliament. I think there are moves, desperate efforts, to embarrass the Government and to give effect to the urgent ambition of some who, for the passing advantage of destroying a Government and changing sides in this House, are willing to pay the price of sacrificing all respect for Australian democracy. That is the purpose of this attempt. That is the policy of the Labor Party at home.

This motion gives us an opportunity to view the policy of the Labor Party on international affairs - the withdrawal of all Australian forces from Vietnam. The Labor Party, with more than a smell of Communist influence within it, urges an act discreditable to Australia’s tradition as a reliable and a staunch ally. Men in our community have, through turmoil and tears, built our reputation as a staunch and reliable ally. This motion comes from the same stable as a resolution passed under the chairmanship of Mr Crawford, the Leader of the Australian Labor Party in Victoria, calling upon our troops in the field to mutiny. The proposal we are now debating is the same thing put in different words. Today the fact is that by treaty and de facto we are an ally of the United States of America and to withdraw our troops and abandon our allies would be an act of shame in the eyes of the United States, South Vietnam, South Korea, New Zealand and others with whom we stand. This motion, if passed, would be a decision to walk out and leave our allies in the field. Do honourable members think that our treaty with the United States would remain unimpaired? The proposal before us is calculated to destroy that treaty. Who in the world wishes to destroy the treaty with the United States? I am not accusing the Labor Party of wishing to destroy it. Who but the Communists wish to destroy it? I am saying that there are many who are unwittingly acting as tools of the Communists. The Communists wish to destroy our alliance with the United States and to end the trust iri which we are held in South East Asia - the trust and respect which South Vietnam has for us; the trust and respect which Malaya, Singapore and South Korea have for us.

With one stroke, Labor’s proposal that we withdraw our forces from Vietnam would make Australia a shameful object of derision internationally. Most important, it would draw the attention of the world to the fact that Australia, by its own choice, alone in a lonely part of the world, had thrown away its alliances. Could we turn to another ally? Where is there another powerful ally in the world to whom we could turn if we threw away the alliance with the United States? We would bo presented as a neutral country, and that is what we would be. It is the purpose and intention of the Opposition to convert Australia, a rich and empty continent, to a lonely neutral. Australia in an emergency would have no ally to turn to, no friend, and no entitlement to have its word respected and trusted. Who is prepared to say that this is a state to which we should reduce the Australian nation? I say to my friends in the Parliament on both sides that there is nothing in the recorded history of man which shows that a rich, undefended country will not be the subject of aggression. God knows we all hope that it will never occur but there is no instance in thousands of years of history which entitles anyone to believe that this will be the state of affairs.

Nothing could more jeopardise the survival of the Australian nation than the kind of proposal which the Labor Party has put before the House today. Labor, influenced by ambition and by sinister leftist forces, would leave Australia friendless internationally. It would put a label on Australia: ‘I am a lonely, remote, rich, helpless country; come and take me’. Labor’s policy is to destroy the authority of Parliament at home and to spurn alliances abroad. There has never been a more tragic policy in the national interests of Australia and her survival than the policy that Labor is propounding today.


– The Minister for Trade and Industry (Mr McEwen) has made a very powerful speech and in view of what he said I think I should devote some of my time to spelling out the attitude of the Australian

Labor Party on some of the matters which were raised in what I have said was such a very powerful speech. The Deputy Prime Minister made many references to the Labor Party; to the alleged left wing direction to which the Party is supposed to be subject; to mob rule; to Communism - ‘more than a smell of Communist influence’ was the term the right honourable gentleman, used - and to the fact that in his belief Labor would take action which would imperil our treaty associations with the United States and leave us virtually naked and alone in this part of the world.

Let us look at the basis on which the right honourable gentleman has made his allegations. First of all, he referred to the matter of public importance that we desired to discuss, namely, the withdrawal of all Australian forces in Vietnam and international action to end hostilities and undertake rehabilitation in Indo-China. He made the point that we made no distinction between our allies and our enemies in the matter of rehabilitation. I think that what the Minister for Defence (Mr Malcolm Fraser) said is true, that every man in this House would want to see peace come to Indo-China and remain in our part of the world, but it is one of the lessons of history that when a war is over all of the people concerned have to be rehabilitated. We are too close to the Vietnam war to be making value judgments on numbers of these things but I think we all recall that after the Second World War the Western countries - Great Britain and the United States in the case of Germany, and very much so the United States in the case of Japan - contributed greatly to the rehabilitation of those war torn countries which had been our enemies but a short time previously.

The Labor point of view is that peace will come to Indo-China, not by military means alone - because the military events which have taken place in Indo-China have been discredited in the United States, in Australia, in Great Britain and throughout the world - but by proper international settlement, an international settlement which takes into account ethnic and political considerations and the wishes and needs of the people of Vietnam, South and North, the people of Laos and the people of Cambodia.

The right honourable gentleman went on to associate the Labor Party with the recent demonstrations at the home of one of his colleagues. We know that he was referring to the Attorney-General (Mr Hughes). I would think there was not a man on this side of the House who would not dissociate himself, as I dissociate myself, from any intrusion into a man’s private home and any intimidation of his family. I certainly disassociate myself from that kind of thing and I think it ill becomes the right honourable gentleman to suggest that the Labor Party would condone such an intrusion. The people who took part in the demonstration did not assist any cause with which the Labor Party would care to associate itself by their disgraceful actions there recently. We have been told that we show violent opposition to the rule of law and that we stand for mob rule. There have been 2 examples of that recently when Ministers and members on the Government side have seen fit to attempt to associate this Party with violence in the streets. One was the Moratorium early in the year. Happily that passed off peacefully in that I know of no person who was injured in the course of any of the very large demonstrations which took place at that time. The second example relates to the situation today.

I do not know what happened in every capital city of Australia but I do know what was arranged to happen in Brisbane. There were not mass strikes. There was a public meeting at which the Trades and Labour Council sought the support of a wide range of people throughout the community particularly to assist pensioners in their fight for a pension which would give them a reasonable standard of living. A permit was sought to hold a meeting in a public place, advertisements were placed in the newspapers and the attendance of police was arranged, as it always is at these functions, to ensure that the meeting took place in an orderly and responsible way. That has always been the attitude of the Labor Party. We do not stand for mob rule; we stand for law and order. We believe in law and order in Indo-China and throughout the world.

We believe that the history of recent times has shown just bow little can be achieved by military involvement. What has the war done for the people of Vietnam? lt has given the Government of South Vietnam, if you take the principles on which the Government puts its points of view, the opportunity to consolidate its position in the countryside of that nation and to make friends with its own population. We are told that the pacification programme has been a spectacular success, and we are told that Australian troops are now training SOO leaders in jungle warfare and the like in order that responsibility in the future may be assumed by the Government of South Vietnam. That is akin to the Nixon Doctrine which was submitted recently to the world by the President of the United States that any nation in our region will have, to stand on its own feet. The President of the United Stales clearly indicated that there would be no more Vietnams. This means that he has recognised the fact that Vietnam has been a futile exercise. Only time will tell whether the sacrifices made by young Australians in Vietnam have produced any permanent advantage to the people of that country.

The Labor Party introduced this matter today, not because we believe in mob rule and the kinds of things that were ascribed to us but because we feel that we should put our point of view within the Parliament of this nation and put the Government in the position where it is able to state its point of view on a number of important matters. As follows in debates of this kind, the Government has leaned strongly on the aspect of aggression from the North and on the military side of the issue. That has been dealt with as well by speakers on our side. But there are other important points of view that the Opposition puts to the House.

The Prime Minister (Mr Gorton) has said that Australian troops will be withdrawn commensurate with the withdrawals being made by the United States. I point out that the Philippines has already withdrawn its 2,400 troops following the recent election there so that Australia in withdrawing its troops will not be alone. In other words, we are asking that Australia spell out a timetable, as the United States President has spelled out a timetable, for the withdrawal of troops. We agree with our Prime Minister that if we withdraw some of our troops we cannot leave a fairly small number behind if their situation will be imperilled. The Labor Party believes that the time has now come when we should withdraw all of our troops.

Another important feature of the matter we have raised is the taking of international action to end hostilities. We have yet to see what diplomatic initiatives this country is taking to help the efforts of the United States to end the war through diplomatic negotiations. Unfortunately we have given the impression throughout the world, particularly throughout our part of the world, that we just tag along and leave the United States with all of the larger responsibilities. The Labor Party does not believe that Australia is without some influence in the world and we would like to hear of the diplomatic efforts that the Government is making to end the war.

Finally there is the question of rehabilitation. This is one thing about which honourable members on the Government side hardly ever talk. Having involved ourselves militarily in Vietnam surely there is an obligation on us to do something at the end of the war to help restore that war torn country. The problems are very great indeed. There is the problem of an economy which is geared almost entirely to the very substantial troop involvement of the United States, Australia and a small number of other nations. As those troops are withdrawn South Vietnam will be faced with tremendous problems, and we have yet to hear the Government spell out what it proposes to do about those problems. We know that in the Budget which has yet to be debated military expenditure in Vietnam shows a tapering off but we see no provision for an increase in civil aid and in economic assistance. Aid of that kind will be absolutely essential if Australia is to discharge its responsibilities in this part of the world in the years ahead.

Minister for External Affairs · Lowe · LP

– I rise to speak to 2 parts only of the matter of public importance which has been raised for discussion by the Deputy Leader of the Opposition (Mr Barnard). The first one relates to international action to end hostilities and the second one to undertaking a rehabilitation programme in Indo-China. Indo-China, I take it, embraces the 3 former Indo-Chinese States - South Vietnam and North Vietnam, Laos and Cambodia. The Australian Labor Party must be 10 years behind the times in asking us to initiate this type of programme which was commenced many years ago and which has been built up by the Australian Government and other governments.

Let me mention first of all this question of international action to achieve peace. What have we been doing to achieve peace and who have been the opponents of the peace movement? lt must be known that our objectives are clear cut and that we are willing to come to an accommodation provided only 2 objectives are achieved. The first one is that we should have a just and fair peace; in other words, that we should provide that the South Vietnamese, the Laotians and the Cambodians should have the right to determine their own future. As well, in the case of Laos and Cambodia we adhere strictly to the terms of the Geneva Conventions of 1954 and 1962 which provide those 2 countries should be free and that they should be neutral. These are the ideals of the Australian Government. They are ideals for which the Australian Government has fought and is still fighting. These are ideals for the achievement of which the Australian Government has provided civil assistance and for which it will continue to make provision for as long and as effectively as it can.

Let us look at what we have done. Over and over again, the plea has been made: Make some concession or offer to the North Vietnamese and, in time, they will come to the conference table and will come to a just and sensible settlement’. What happened? The bombing of North Vietnam ceased. Immediately afterwards, a conference was called in Paris. With what result? Despite the fact that concession after concession was made the North Vietnamese refused to abandon any of their own policies or any of their own objectives. What were those policies and objectives? The first was that there should be a coalition government, not elected by the people of South Vietnam but determined by the Communists themselves. Consequently the context of government was pre-ordained by the Communists of the North. Secondly, the North Vietnamese wanted the total evacuation of the American, Australian and Cambodian troops from South Vietnam. They did not think in terms of evacuating Cambodia themselves or of ridding that country of the enclaves of North Vietnamese troops that had been established there. No! The North Vietnamese wanted total domination of South Vietnam. As well, they wanted total domination and Communist oppression throughout the length and breadth of the Indo-Chinese peninsula. 1 turn to Cambodia and, to a lesser extent, to Laos. In Cambodia, our objectives in accordance with the 1954 protocol were these: We wanted their independence and neutrality. The North Vietnamese - the Communists themselves - had given an assurance at Geneva that they would respect the neutrality and the independence of those countries. But they established vast enclaves of between 40,000 and 60,000 troops in Cambodia, immediately adjacent to the South Vietnamese border. They showed that they were not willing to come to the conference table or to participate in the cause of peace.

Let us take the argument a little further. Some time ago some of the neutral and free countries of the world decided to call a conference in Djakarta to try to achieve the 1954 protocol objectives, that is, the neutrality of Cambodia. Not only the free countries, Malaysia, Singapore, Thailand, the Philippines, South Korea, Indonesia and Australia but also the Communist countries, Communist China and North Vietnam, were invited. Did the latter come or did they stay at home and continue to wage warfare? They stayed at home and persisted in their ruthless and blatant aggression against Cambodia. They refused to attend and participate in the discussions.

The matter has been placed before the permanent members of the United Nations - before the Union of Soviet Socialist Republics and other countries. But we have never been given one glimmer of hope that the Communists would come to the conference table. So why speak in terms of initiating negotiations now? Of course, we will continue, but no more concessions can be made on the part of the free countries of the world in our endeavours to achieve the right of peoples to live in freedom, free from fear, free from want and free to be able to carry on the government of their own countries free from interference by others.

As to the second part of the proposal - that is whether or not we can achieve rehabilitation or whether we should initiate proposals for rehabilitation - obviously the Australian Labor Party does not know what is being done now not only by ourselves but also by the South Vietnamese and the Government of the United States of America. Tonight the House will be debating the Budget Papers, but I take this opportunity to point out that this year we are allocating $3. 4m to the civil rehabilitation of South Vietnam.

Mr Barnard:

– It is only a fraction of the total, you know.


– You are doing nothing. Honourable members opposite want to embrace Sihanouk; they want him to get all the credit. Honourable members opposite want this man who lives in the bosom of the Communist Chinese to dominate Cambodia. In a moment I will deal with where the sentiments of the Opposition lie and the kind of victory that the Australian Labor Party wants to see achieved.

In this Budget we are allocating Sim for civil rehabilitation in Laos. But other countries are making a massive effort in this direction. Last year the United States devoted $5l4m to the rehabilitation of South Vietnam. Only yesterday the VicePresident of the United States announced that S40m in aid would be given to Cambodia. If we look therefore at the efforts of Australia and its allies we see that we have not waited; in fact, we are already making a very big effort. Our programme of civil aid to overseas countries this year is far better than in any other year during the time that T have been a member of the government. It will be seen that we are playing our part.

What is happening on the Communist side? Has any member of the Opposition or any member of this House heard any Communist country say that it was prepared to make any contribution whatsoever to a civil aid programme for any part of Vietnam, North or South, or for any part of Cambodia or, for that matter, any part of Laos? On the contrary, the activities of Communist countries have been solely in terms of military measures designed to ensure a Communist victory in and Communist subversion of these 3 or 4 - however honourable members like to describe them - former countries of the Indo-Chinese peninsula.

What conclusion can we draw from the picture that I have just painted? I ask Government members as I ask any member of the Opposition, including those who have learnt the lesson because they have recently visited Cambodia, to note that this government is willing to defend these people and their cause of freedom, to give them the opportunity to express themselves, and to give them the opportunity to say what kind of government they want. Within our capacity we are willing to provide civil aid for these people. But what do we find when we look at the Opposition benches? Wittingly or unwittingly, stupidly or not, every time honourable members opposite raise this question in the House, it is in support of the avowed enemies of this country and those who not only are attacking allied troops but also are engaged actively in warfare against the people of this country.

Mr Barnard:

– You know that that is untrue.


– It is true and the honourable member knows it. So what attitude can we adopt towards members of the Australian Labor Party? 1 ask every person who has and welcomes the right of choice this question: Does he want the GortonM’cEwen Government, a Liberal-Country Party Government, which will play its part in the cause of freedom, or does he want a government formed by the Australian Labor Party which is consciously, determinedly, and persistently assisting our enemies and which is giving aid and comfort to those who are out to destroy freedom and who want a Communist regime to dominate that part of South East Asia that is of importance to us and of vital importance to the security, the future and the continued independence not only of Thailand and Cambodia but also, 1 believe in time, of Malaysia, Laos and Singapore.


– Order! The discussion is now concluded.

page 451


Minister for Customs and Excise · Hotham · LP

– I move: Customs Tariff Proposal No. 14 (1970). Customs Tariff Proposal No. 15 (1970). Customs Tariff Proposal No. 16 (1970). Customs Tariff Proposal No. 17 (1970). Customs Tariff Proposal No. 18 (1970).

The Customs Tariff Proposals which I have just tabled relate to proposed amendments to the Customs Tariff 1966-1970. Customs Tariff Proposals Nos 14 to 18 (1970) formally place before Parliament the tariff changes made by Gazette notices and published in the Gazettes of 2nd and 6th July and 3rd and 4th August while the Parliament was in recess. The changes arise from Tariff Board reports on sorbitol and mannitol, alloy steel, high carbon steel and electrical steels, calcium carbide, vulcanised rubber sheets, electrical relays, cinematograph projectors, breathing appliances and artificial respiration apparatus and footwear with non-leather uppers, etc. Other changes extend the list of commodities in Schedule A of the New ZealandAustralia Free Trade Agreement.

Honourable members will recall (hey received copies of Press statements from my colleague, the Acting Minister for Trade and Industry at the time the tariff changes were gazetted. These statements set out the origin of the alterations. For this reason I do not propose to go over the same ground at this juncture but when the Tariff Bill to enact these proposals is introduced I will propose that that information be incorporated in Hansard for the convenience of honourable members in the ensuing debate. A detailed summary of the changes and rates of duty is now being distributed to honourable members. I commend the proposals.

Debate (on motion by Mr Crean) adjourned.

page 451


Reports on Items

Minister for Customs and Excise · Hotham · LP

– I present the following reports by the Tariff Board:

Alloy steel, high carbon steel and electrical steels.

Breathing appliances and artificial respiration apparatus. Calcium carbide.

Ceramic tableware (New Zealand-Australia Free Trade Agreement).

Cinematograph projector*.

Footwear with non-leather uppers, etc.

Sorbitol and mannitol.


Vulcanised rubber sheets, etc., and Paper clips of base metal (Dumping and Subsidies Act).

The last report does not call for any legislative action.

Ordered that the reports be printed.

page 452


Second Reading

Consideration resumed from 21 August (vide page 418), on motion by Mr Chipp:

That the Bill be now read a second time. Question resolved in the affirmative. Bill read a second time.

Message from the Governor-General recommending appropriation announced.

Third Reading

Leave granted for third reading to be moved forthwith.

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

page 452


Second Reading

Debate resumed from 4 March (vide page 77), on motion by Mr Hulme:

That the Bill be now read a second time.


– I am leading in this debate in the absence of the honourable member for Lang (Mr Stewart) who cannot be here this afternoon. The Bill is designed to cover up some of the mistakes made in the past by the Postmaster-General (Mr Hulme) and his adviser, the Broadcasting Control Board and to justify their actions in the future. Under the existing Act the onus is on the Postmaster-General to see that television and broadcasting licences in Australia are issued in accordance with the public interest, convenience, and necessity, in strict compliance with the terms of the Act. When it comes to the transfer of licences, or alteration of their conditions, the onus is entirely upon his shoulders. We understand, of course, that he is guided by the advice he receives from his experts on the Broadcasting Control

Board. This Bill deals with the qualifications of licensees of stations. I do not know whether the Minister has noted that the House of Representatives in the United States passed the Independent Media Preservation Bill which is designed to prevent a metropolitan newspaper holding a licence for a television or broadcasting station in the same area. The United States Federal Communications Commission applied the same principle recently when it cancelled the licence of WHDHTV, Boston, because it was held by the Boston ‘Traveller-Examiner’, and was held to create a monopoly in the news media in the area. The licence was then re-issued to a group of local interests. Similar action is proposed in connection with the licence of WPIX, New York, which is owned by the New York ‘Daily News’ and similar action is also foreshadowed against the broadcasting station owned by the New York ‘Times*.

The United States Justice Department is reported to be currently examining the joint ownership of newspapers, television and broadcasting stations to see whether the Anti-Monopoly Act is being violated, and where it finds such violations have occurred, it will undoubtedly call on the FCC to refuse to renew the licences and issue them to other applicants. In this House on 8th April this year I pointed out to the Prime Minister (Mr Gorton) the desire of the US Federal Communications Commission to have legislation introduced to break up existing multi-media combinations in the United States over a maximum period of 5 years. I asked the Prime Minister on that occasion would he introduce similar legislation to break up existing multi-media combinations in Australia. His reply was rather flimsy wherein he stated he would be reluctant to accept the proposition that something that once operated legally should after the passage of certain legislation be said to be operating illegally. In other words, what he said was this: Because one government at some stage approved the existing multi-media setup in Australia other successive Governments cannot look to changing the situation even though the provisions of the relevant legislation may be operating to the detriment of the people. On the basis of that profound piece of logic no bad law can be repealed because it was once deemed to have operated legally and properly. With this sort of fuzzy thinking from the Prime Minister no wonder the Postmaster-General has no incentive to administer the Act strictly in the public interest contrary to the corporate interest vested in this area.

Television and broadcasting licences in this country are mainly in the hands of 5 great metropolitan newspaper groups, The Melbourne ‘Herald’ and ‘Age’, in Melbourne, John Fairfax and Sons Ltd, and the Consolidated Press Packer interests - in Sydney, and the Rupert Murdoch Adelaide ‘News’-Sydney ‘Daily Mirror’ group in Adelaide and Sydney. According to the Act no group is supposed to control more than 2 television stations or more than 8 broadcasting stations in Australia. I propose to show how the Postmaster-General has broken both the spirit and the letter of the Act in the issue of licences to these groups, and by giving his consent to the transfer of licences from interests who were only originally granted licences for specific purposes, but those same licences we now see transferred to the members of these giant newspaper groups.

Firstly, I will take the Melbourne Herald’ organisation. In television it has absolute control of HSV7 Melbourne and, through its subsidiaries of Queensland Press Ltd and the ‘Daily Telegraph’ in Brisbane, it controls BTQ7 Brisbane. Through its own holdings and those of Queensland Press Ltd it holds, for the purpose of this Act, a controlling interest in ADS7 Adelaide and through its majority holding of shares in Davies Bros, publishers of the Hobart ‘Examiner’, it holds a controlling interest in TVT6 Hobart. In other words, the total number of television stations it controls in Australia is 4 instead of the maximum of 2 which is stipulated under the Act. Again, the Melbourne Herald’ recently acquired a controlling interest in West Australian Newspapers Ltd, which controls TVW7 Perth, but I understand that the Postmaster-General has refused to consent to the transfer and has instructed the Melbourne ‘Herald’ to dispose of such shares.

Let us have a look at radio broadcasting. In Victoria the Melbourne ‘Herald’ holds the licences for 3DB Melbourne and 3LK Lubeck. In Queensland, through its subsidiaries, it controls 4BK Brisbane, 4AK Darling Downs and 4AM Atherton. In South Australia, according to a proper application of the Act, it may be said to have a controlling interest in 5AD Adelaide, 5M.U Murray Bridge, 5PI Crystal Brook and 5SE Mount Gambier, while in Tasmania, through Davies Bros, it holds a controlling interest in 7HO Hobart. In Western Australia, through its recent acquisition of West Australian Newspapers, it picked up an additional 4 broadcasting stations, namely, 61X Perth, 6MD Merredin, 6WB Katanning and 6BY Bridgetown. In other words, the Postmaster-General has been a consenting authority to the holding of 14 broadcasting licences by the Melbourne ‘Herald’ instead of the fixed maximum of 8 under the Act.

I shall now say a few kindly words about the empire of John Fairfax and Sons Ltd, publishers of the ‘Sydney Morning Herald’ and the Sydney ‘Sun’. Its story, like the one of the Melbourne ‘Herald’, is also one of commercial bigamy. In the field of television it holds the licence of ATN7 Sydney and BTQ7 Brisbane, while for the purposes of the Act it could be said to hold a controlling interest in CTC7 Canberra and, through its subsidiary the Newcastle Morning Herald’ and Miners Advocate, a controlling interest in NBN3 Newcastle as well as major holdings in W1N4 Wollongong, BTV6 Ballarat in Victoria and DDQ 10 Toowoomba on the Darling Downs in Queensland. The ramifications of the Fairfax empire in broadcasting are just as wide ranging as those of the Melbourne ‘Herald’. It owns all the shares in 2GB Sydney and 2 WL Wollongong and all the ordinary shares in 2CA Canberra. It also has majority holdings in 3AW Melbourne, 5DN Adelaide and 2LF Young in New South Wales. In addition, through its subsidiary the ‘Newcastle Morning Herald and Miners Advocate’, it holds a controlling interest in 2NX Bolwarra and 2NM Muswellbrook. In addition, under the terms of the Act it has a controlling interest in 4BH Brisbane. Chandlers (Australia) Ltd of Brisbane transferred its shares in 4BH to John Fairfax and Sons Ltd although the company must have fully realised that in doing so it was consenting to a violation of the strict terms of the Act. Although he was not the responsible Minister at the time the PostmasterGeneral should have personal knowledge of this transaction.

John Fairfax and Sons Ltd also hold 2,241,400 shares out of a total of 6 million in David Syme Ltd so that if we adhere strictly to the definition of control as expressed in the Act, John Fairfax and Sons Ltd may be said to have a controlling interest in David Syme Ltd, publishers of the Melbourne ‘Age’ and ‘Newsday’. Quite recently the Minister consented to the transfer of the licence of 3XY Melbourne to the Melbourne ‘Age’, which makes it another fief in the Fairfax empire, although the Act says that the same interests can only hold one metropolitan licence in the one city. The Fairfax organisation’s partner in the Melbourne ‘Age’ is the David Syme Trust. The David Syme Trust owns all the shares in the Victorian Broadcasting Network Ltd. It also holds all the shares in 3CV Maryborough, 3HA Hamilton, 3SH Swan Hill and 3TR Sale. The Postmaster-General has also given his consent to the acquisition of all the shares in 4MK Mackay in Queensland and 6PR Perth, 6TZ Bunbury and 6CI Collie in Western Australia.

The next corporate Press interest with which I would like to deal is the Consolidated Press-Packer interests in the Sydney Daily Telegraph’ and other publications. In television they hold majority interests in TCN9 Sydney and GTV9 Melbourne and, through subsidiaries, substantial interests in WIN4 Wollongong, NBV3 Newcastle, ECN8 Taree and BTQ7 Brisbane. Technically speaking their holdings are within the terms of the Act, but the position with regard to their holdings would not be tolerated if the American principles were applied to local television administration. In the broadcasting field the Packer interests own a majority of the shares in 3AK Melbourne.

The story of 3AK is an interesting one. The licence was originally granted to a small religious sect, under the strict terms that it was to be on the air from midnight to dawn only. After suffering heavy losses for many years, it was given permission by the Australian Broadcasting Control Board to vary its hours from dawn to sunset. When the Packer interests bought the licence application was made to convert it to a 24 hours a day station. This meant that it was in competition at night with existing Melbourne stations. As the purpose for which the licence was issued had changed completely it was for all intents and purposes an entirely new licence. Had the Control Board done its job properly it would have recommended to the PostmasterGeneral that new applications should be called for and a public inquiry held before he rushed in and gave his consent. The Postmaster-General also gave his consent to the transfer to the Packer interests of 4 stations in Western Australia belonging to the Whitford Network, namely 6PR Perth. 6AM Northam, 6KG Kalgoorlie, and 6GE Geraldton. These licences had been granted originally to Western Australian residents. If the Postmaster-General had observed his own declared policy, an opportunity would have been given to the local residents to acquire the stations before he consented to their transfer to interests which the people of Western Australia would regard as foreign.

Finally, I come to the interests of Rupert Murdoch and the Adelaide ‘News’ group. In television they own all the shares in NWS9 Adelaide and. through the ‘Daily Mirror’ in Sydney have a controlling interest in WTN4 Wollongong and, through another subsidiary, a 15% controlling interest in NBN3 Newcastle. In broadcasting, Murdoch has a controlling interest in 5DN Adelaide, all the shares in 2BH Broken Hill and, through a truly remarkable deal, he has acquired all the shares in 6KY Perth, the licence of which was originally issued to the ‘Worker’ newspaper and its satellite station 6NA Narrogin.

All the facts and figures I have quoted in this speech were obtained from the 21st annual report of the Australian Broadcasting Control Board, though I must admit that it was only after some very close scrutiny. They prove how the PostmasterGeneral has driven a horse and carriage through the provisions of the Act and, by signing renewals of licences, has condoned gross violations of the provisions of the Act I believe that the proper course which should be taken with this Bill is to refer it to a standing committee of this House, which should conduct a full public inquiry into how our mass communications have been thrown into the hands of a few powerful newspaper proprietors. The committee should also make recommendations regarding the issue and renewal of licences and the conditions under which transfers of licences are granted. The Prime Minister has stated that he is in favour of setting up standing committees of the House to report on proposed legislation. Here is one subject which is simply crying out for such an inquiry. T challenge him to prove his bona fides to this House and to the members of his own Party who have requested the establishment of such committees by setting up such a committee.


– Whilst one could perhaps sympathise with the intentions of the honourable member for Blaxland (Mr Keating), nevertheless quite a number of the facts that he adduced were not strictly accurate. The honourable member claimed that a small minority of persons or companies controlled the communications network in Australia, particularly television. Among other things, he referred to the radio station 4BH. which he said was sold to John Fairfax and Sons Ltd, or a Fairfax-owned subsidiary or something of this kind. Actually, this station was sold not to John Fairfax and Sons Ltd but to a group of companies each of which holds a percentage interest in the total transaction which is completely in conformity with the Broadcasting and Television Act. The honourable member also said that the Melbourne ‘Herald’ controls 4 television stations. 1 think it will be found on examination that his statement is completely out of keeping with the facts. It appears that the honourable member feels that something has been done which is contrary to the provisions of the Act. This is a serious charge which ought to receive greater scrutiny than the scrutiny I can give it this afternoon because there are other things which also claim my attention. A Bill such as the Broadcasting and Television Bill carries overtones which reflect the importance of this tremendous field of modern mass communications - a field in which a revolution is only beginning to be felt in Australia. Looking back I can remember the days of my youth when the first wireless sets were introduced into my area. I remember the excitement in the street in which I lived when a neighbour obtained a set with its plethora of lighted valves. We listened to its horned speaker in wonder.

As we look ahead from those days to the days of the pocket size transistor and tomorrow to colour television in Australia, to pocket television, to very mobile telecommunications in the keeping of the individual, it is undoubtedly true that a tremendous revolution in this whole field is only beginning. As one looks at the field one must .be aware that this revolution means that a completely different base to society is beginning to develop - that there are new powers for the manipulation of society; that there is a sophistication in terms of the presentation of material over the media which has to be scrutinised and understood not only by governments, educators and those who seek to benefit financially or commercially from these things but primarily by the great mass of people who are so often the victims of mass communications.

Notwithstanding the remarks of the honourable member for Blaxland. I believe that in Australia we have been remarkably well served by the mass media. This does not mean that dangers are not emerging - dangers of the kind referred to by the honourable member. There is a danger that the control of the material which is broadcast will be centralised in too few hands. This comes about not necessarily because of the organic connection between these organisations but because of commercial connections, because of the financial considerations which limit the multiplicity of channels and the multiplicity of available material. As one travels in South East Asia and sees the vast mass housing facilities being created in many areas, each apartment, with its same little neon light outside, its same little television aerial above. its same television set inside and the same programme being televised to the same kind of people, one begins to experience something of the horror of the George Orwell nightmare. The whole concept of television and radio control of the mass, bringing about a mass response, fills one, particularly if he values freedom of initiative and variety, with a good deal of horror.

Nevertheless, there are other fields more precisely related to the Australian scene which anyone giving consideration to the amendment of an Act such as the Broadcasting and Television Act must have squarely before him if he is properly to discharge his duty. 1 refer to such things as the increasing influence of the mass media on the minds of young children and in their education. Anybody who has a young family, as I have, and who realises how much time his children spend with their eyes and minds glued to the television apparatus must be aware of the tremendous influence this thing exercises. This brings us to the kind of diet upon which their minds are being fed. 1 believe that in Australia we are approaching the stage when we must ask ourselves whether our children are being given sufficient content that is truly Australian - not only Australian in terms of its origin commercially but also in terms of the expressions, the philosophy, the culture if you like, the background of thinking and the attitudes which would be truly indicative of the response of the average Australian.

Being a relatively small country it is so easy for us to import from a larger country programmes in our language or which purport to be in our language but which convey a relatively foreign response to many things that are vital in the development of the Australian mind. We have heard recently of agitation by certain sections of the community for a greater Australian content in our television programmes. I sympathise with these people, many of whom, of course, seek to promote their own professional futures. Nevertheless 1 give them full marks for sincerity of purpose and altruism. I believe most Australians would sympathise with them. One must concede the costliness of producing de novo an Australian programme, with the actors, the sets and all that is involved in the editing and production of such a programme compared with simply buying an overseas produced programme after it has had its run overseas. Of course the cost of producing in Australia will be greater. One of the difficulties is that the audience for an Australian programme would be limited because only a few relatively wealthy stations would be able to pay the kind of money which at first sight would seem to be indicated as necessary to purchase a programme like Homicide’ and the other programmes that are being produced successfully in Australia.

I would make the positive suggestion that it is not necessary to accept the proposition that the smaller stations - the country stations - which want to air Australian programmes would be unable to find this kind of money and so must go without. In this area governments should scrutinise the possibility of legislating so that such stations might be charged for a programme according to the number of their viewers or, if you like, their capacity to pay because in my opinion a worthwhile Australian programme should be seen widely throughout Australia. A small station serving a small community and having a small return from advertising during the screening of such a programme should be able to obtain the programme at a figure within its budget. This may be an idealistic attitude but it is one to which we must increasingly turn our attention.

The other side of the coin is the unrealised potential for misuse of this new medium of television and for deception. I speak as one having some small experience in television in Australia. Having had to arrange and compere a weekly half hour programme on public affairs for almost 5 years I understand some of the possibilities that exist in the media. Robin Day of the British Broadcasting Corporation has written a fascinating and challenging article which everybody in Australia interested in this field should ponder. Robin Day is one of Britain’s leading public affairs programmers. He has been with BBC television for 10 years. Before that he was with a commercial network. He has a distinguished academic background. His article, which is published in the British publication Encounter’ is entitled Troubled Reflections of a Television Journalist*. Tn it he refers to some of the things he has experienced and to some of his thoughts in trying to come to grips with the problems posed by television.

Perhaps 1 could give one or two illustrations of the kind of thing to which he points. He suggests that with this new medium of television a new kind of communication has been set up which is severely limited in itself. It is limited because of things which are inherent to the medium itself. It is limited because it speaks in pictures, lt can get across only other than abstract thought, lt cannot get across chains of argument, of syllogisms in logic and the rest of it, but only the dramatic and the obviously pictorial things that lend themselves to the camera. He rather jokingly suggests that we are going right back to the most, primitive form of communication, the picture language of an earlier era. At the same time as there are these inherent disabilities in terms of communication by television there are also imposed disabilities. I refer to those imposed by people seeking to exercise political control over this medium, and the commercial control which means that only those who are able to afford the price and therefore who seek, having paid the piper, to call the tune.

In this way Robin Day points up the ways in which he believes television is potentially subject to limitations and difficulties.

The other aspect that he brings up is perhaps even more significant. In seeking for good television the producer so often is confronted with a dilemma as to how to bring about the result because of the necessity to carry around rather cumbersome equipment - cameras, microphones, lights and the rest of it - and the number of persons necessary in the team. This is so different from the days of the reporter who simply took around his notebook. Sometimes he did not have even that but relied on his memory of an eye-witness account. These days there are new kinds of reactions in the situation under scrutiny. These are inevitable because of the introduction into a situation of a television team. One knows that at political protest meetings and in statements made in front of a camera so often things are exaggerated. One might go so far as to say that new or even pseudo situations are created on occasions by the presence of the camera. These are not my sentiments; they are those of a non-politician, Robin Day.

Tn those early days of television I, too, realised something of the possibilities of distortion. For instance, Robin Day asks whether it is altogether reprehensible for a camera man to say to a celebrity: ‘Would you mind going back and coming through the door again. I want to get a shot of you coming out the door of No. 10 Downing Street. The shot I have is not quite what I wanted.’ This might be acceptable, but how far should we carry this re-enactment of a situation for the camera? If we do this should we go so far as some producers have done and provide persons and a place in which to photograph, for instance, the reactions of addicts in a drug party? Do you pay those persons? Do you bring them together in premises where it is known that they can obtain drugs and even perhaps go so far indirectly as to supply them with drugs in order to take photographs for a documentary series? This is the kind of serious question that Robin Day asks about the difficulties facing television.

I had an interesting experience some time ago when 1 tried to chair a discussion between the late Dr Evatt and the late Mr Townley over an immigration matter. Dr Evatt was seated on my right and I introduced the programme, as was my wont, by saying: ‘Doctor. I understand that at the recent citizenship conference you criticised the Australian Government for its immigration policy on 2 scores. I wonder if we might discuss these.’ Dr Evatt said: ‘If you do not mind, Doctor, I will summarise my own arguments.’ Then he went ahead for 13 minutes without let or hindrance. I plucked his sleeve, I coughed and I tried to intrude but nothing could stop him from continuing his 13-minute burst of oratory. The station management came to me afterwards and said: ‘That is the last time that that will happen. The next time someone tries to do that we will not have a common microphone. We will have individual microphones. We will turn the camera from the person speaking. We will tone down his voice and put the camera over to you. You can then address a question to the other participant and leave the first person speaking to nobody.’

This is an illustration of the way in which it could be possible - I only suggest it is possible - in unscrupulous hands to present a complete debate in a way which does not coincide with the truth. The asides, the interjections from one side, can bc magnified while those from the other side are disregarded. Persons can be made to appear inconclusive in their statements. The statements can be taken over by someone ready to do so on the opposing side. It is possible not for the camera to lie but for a producer to produce a result not in accordance with what an eye-witness would see in a studio. I do not want to go any further in elucidating these very many points. I have done only scant justice to the kind of things brought out by Robin Day in his most penetrating article and his conclusions. 1 want to move on to the Australian scene and the way in which I believe we must continually search and research the basis on which our mass communications, particularly radio and television, are being conducted. I believe the present attitude in Australia is fraught with danger. We are extremely timid of the possibility of political bias or of some other bias intruding into a programme. Rather than have a situation where this could occur, rather than face the criticism of bias, the media are inclined to shy away from it or introduce what I regard as outdated or crude methods of establishing guidelines for such programmes. I will give one illustration of this. Some time ago I was running a programme to which I invited a certain person who happened to be president or chairman of the Water Research Foundation of Australia. I wanted him to discuss a purely technical matter on which he was an expert. However, because he was a member of a legislative council or a legislative assembly - T forget which it was - in a State Parliament it was not possible for him to appear without a counterpart from the opposite political party, regardless of whether that person knew anything at all about the subject. This I regard as one of the really crude methods of trying to establish built-in safeguards against bias.

There would seem to me to emerge the need for a body that would be more widely representative of the whole community to view and review, particularly upon submission from a significant group of people, a certain period of programming. This panel would do so in the light of whether or sot some kind of change or some kind of compensating factor should be brought in to correct witting or unwitting unfairness or bias. Thus the initiative and spontaneity of the producers, directors and participants in programmes should not be unduly curtailed.

During a recent controversy over Australian Broadcasting Commission current affairs programmes I gave thought to a number of guidelines which I thought could be helpful. I give these points only as suggestions as to the kind of bases upon which I believe a reasonable and unbiased approach could be made to this very vexed question.

Mr DEPUTY SPEAKER (Mr Jarman)Order! I think the honourable member for Evans is getting slightly wide of the contents of the Bill, interesting though the debate is.


– The Bill is to amend portions of the Broadcasting and Television Act relating to financial operations, certainly, but I suggest that as it will also affect the practical operations of the Australian Broadcasting Commission and the commercial stations so far as their ownership and control are concerned, there is also under scrutiny the question of control and thereby the presentation of programmes produced by stations. Nevertheless, in deference to you, Sir, I will summarise and simply say that I believe it is possible to bring up guidelines which would enable a programme to be produced without being subject to this continual cry of bias, or if it does to deal with it fairly without suggestion of political manipulation.

The Bill before the House contains provisions relating to the activities of individual stations. One of the grave difficulties that emerges as one reads between the lines of the Bill is the fact that finance is a dominating factor. Finance in the hands of those who are happy enough to possess it in considerable quantities can be a determining factor in the quality of the programme produced and therefore in its content. One of the things T think it is necessary for a government to do in scrutinising the Broadcasting and Television Act is to keep before it all the time the necessity to be dynamic in its approach to the freedom of the producer to produce the kind of programme which is in the best interests of his own creative ability, of his audience and of the programme. At the same time I believe that there must be an overall realisation that we are dealing with a new medium. This is evident in the second reading speech of the Postmaster-General (Mr Hulme) in which he said that one of the objectives was, having consulted the Treasury and the Auditor-General’s Office, to ‘reflect the modern approach to statutory authority financial regulations. I applaud this. I think it is excellent. But I go on to say that there is developing across the world today an understanding of other modern developments within the whole field of broadcasting and television. This development is not only in the financial field. It is not only in the commercial or governmental control field that there is a need for a greater scrutiny to take place. I believe that we are moving into an era where it is necessary for a government to take responsibility in a much wider and more far-reaching way than we have done yet in this field.

In this House we have continually heard the suggestion that there is something indecent or improper in a government’s intruding into the field of commenting on programming controls exercised through the Australian Broadcasting Control Board or into the running of the Australian Broadcasting Commission. I question that attitude. I believe that perhaps the days are approaching when we should have a ministry that is perhaps directed specifically to deal with the whole field of public information and that its activities and rules should be subject continually to scrutiny in this House. I believe that it is only in this area that elected representatives of the people are able to look at the kind of guidelines that are brought forward for our programmes. It is the only area where debate is possible in a free and unfettered way. Here, with all the freedoms that are afforded debate in this place, we can look for security against some of the difficulties and the dangers that I have mentioned. In my view this is a governmental matter; it is one calling for continual review and amendment of the Act. It is one which I believe should be open to debate.

I could summarise what I have to say in this sentence: Are we going to hand over responsibility to some other body, no matter how competent, how fair or how celebrated they may be in the public eye, just because we think that this is fairer and more democratic - and principally because they are not elected by the people of Australia? In my view it would be possible for us to have before this House a series of guidelines that would be acceptable to both sides of the House and that would enable us to approach amendments in the future in a way that would provide for the scrutiny that I have suggested. In this way I think we would be able to obviate some of the difficulties which occur from time to time because of the mammoth finances involved or because of the large political questions involved.

The other aspect of the Bill relates to extending broadcast listener’s and television viewer’s licences to several additional small groups of pensioners. I think this proposal speaks for itself. It is something which I am sure everyone on both sides of the House will applaud. It is certainly an amendment which is in keeping with the changes that are taking place in our community because these are days when pensioners and retired persons rely more and more on television and radio for their entertainment. I believe that anything that could be done to make this more possible for them financially is to be applauded. Therefore, I have pleasure in supporting the second reading of the Bill and commend the alterations and amendments to the House.


– Having to follow the honourable member for Evans (Dr Mackay) has left quite a deal of my speech in front of him which he has already delivered. I refer to that part of the honourable member’s speech which made reference to the writings of Robin Day. I had intended to use one or two excerpts from this publication. As the honourable member for Evans has already used this material I will not bore the House with tedious repetition. 1 must say that I think a constant revision of the Broadcasting and Television Act is very necessary in this day and age when one now sees how this industry has expanded in so short a time. I want to deal with one or two aspects of the amendments proposed in the Bill. Let me say straight away that I applaud the PostmasterGeneral (Mr Hulme) for that section of the Bill which enables the financial limit of $40,000 and the period limit of 5 years on transactions of the Australian Broadcasting Commission to be lifted to a sum of $100,000 and a period of 10 years respectively. I think this is a very necessary amendment because, as I said a moment ago, great changes have taken place in the last few years in this industry. I think the amendment also allows the Australian

Broadcasting Commission in this context lo be more readily aware of what is expected of it on a local scene. Of course, we have a national broadcasting system. But as such, if it does have failures - and indeed it does - I think some of them stem from the fact that rather too much authority and rather too much programme administration tends to eminate from Sydney or the capital city concerned. Certainly, as far as regional broadcasting and televising is concerned, in my own State of Tasmania I have felt for some time that perhaps a little more local involvement in what the people want locally might not be a bad thing, lt is the overriding sort of decision making that is made at head office - I think this is the affectionate term one uses - that is sometimes not in the best interest of a national broadcasting organisation.

I should now like to deal with the question of ownership. One could quote statistics and figures to prove almost any argument that one wanted to prove. But if I may take the time of the House, I shall refer to that section of the Bil) which deals specifically with the problem of ownership. I believe the honourable member for Evans made a very good point when he said that we are in great danger of centralisation. I think this is what has happened in the commercial field. For instance, consider ATN in Sydney. The total issued share list of this television company is in the region of $1,494,118. John Fairfax and Sons Ltd, the proprietors of the ‘Sydney Morning Herald’ own over 1,06.1,000 of this station’s shares. I could repeat that story right through all of the States of the Commonwealth, ft seems to me that ownership of a newspaper is not necessarily a qualification for controlling and running a television station. Indeed, the activities of both are widely different. Robin Day has made the criticism that a newspaper has its own editorial content and its own editorial column. I cannot remember any television station that is similarly placed. I think perhaps the time has come when we in this country might allow or might give consideration to a little more freedom and flexibility in the editorial scene or the editorial function of television stations. I think in my first speech in this chamber I made some comment on this point, and it is well worthy of consideration. ] should like to comment on one or two of the points made by the honourable member for Evans because I think they are relevant to the amendment before the House and indeed relevant to the whole industry. The first was on the question of bias. Bias is terribly difficult to determine, because what is bias to some may not be bias to others. The honourable member referred to guidlines for the Australian Broadcasting Commission. Presumably these guidelines would be established for the commercial networks as well. There is a great danger in establishing guidelines for any particular organisation, whether it be commercial or national. In the first instance who is to establish the guidelines? It may well be that a section of the Government parties objects to a particular presentation. Tt may well be that we on this side of the House will object to a particular presentation. 1 suggest that there will never be 100% agreement on the correct way in which that presentation ought to be made. It is almost impossible to arrive at a common area of agreement in this industry. I think it is very dangerous indeed to start talking about the establishment of guidelines to advise or to suggest to the ABC or any other organisation that it ought to present a programme in this particular way or in that particular way.

My views on this subject are very well known: I have slated them before. I feel that in a democracy there is no place at all for political interference or for the establishment of guidelines either for television stations or for any other sector of the mass media. To do this sort of thing is to establish a governmental overlay on what it is thought the people ought to be consuming. That is never successful in any democracy. 1 return to the cost of programmes A question was addressed to the PostmasterGeneral in this House this afternoon and he answered it at some length, lt was an answer that had to be given in some length because this is a very involved and difficult situation. Country stations have great problems which are caused by the expense involved in buying programmes. 1 support the honourable member for Evans when he says that there ought to be some government investigation into country stations being afforded some consideration in the buying of expensive programmes. I say this for one very good reason. The PostmasterGeneral knows better than I do just how important it is to embrace people in isolated and country areas with the wonderful mass media. These people are somewhat less fortunate than people in the capital cities because their choice of programme is somewhat restricted and subsequently inhibited by the cost factor.

I merely make the suggestion that some thought might well be given to pursuing or examining some proposition that would allow people in country areas to have access to such programmes at a reduced cost. How the mechanics of it would work I do not know at this stage. I think that some examination should be made, because these people live in an area of isolation where communication is very important. The problem confronting the television industry in this country at the moment is one of continuing difficulties for indigenous productions. I speak of the work of Australian producers, writers and actors. I know that the Postmaster-General is well aware of these difficulties. Indeed on Saturday night last he contributed a segment to the ‘Four Courners’ programme. There ought to be a very close examination of the industry as a whole, not a fragmented or segmented examination. The writers, the producers and the actors should come together with a proposition for the Government in relation to quotas. It is no good our accepting the fact that Australian local television productions today are too expensive to purchase. We have a duty to the people of this country, indeed to our own children, to provide them with a culture that is indigenous to this country.

I can quote statistics to show the amount of exposure we give to programmes of Australian origin. The percentages are not very startling, in fact, they are rather the reverse. The latest available figures I have show that in the field of drama or adventure Australian programmes shown on the major commercial stations account for 1.1% of the total. The proportion of all programmes of Australian content is 0.5%. On the national stations the position is better, but in my view and in the view of many people engaged in the industry, it does not improve sufficiently for us to be inspired by it. The figures reveal that on the national networks the respective percentages are 2.2% and 1.1%.

Mr Grassby:

– That would be the lowest in the Western world.


– As my friend the honourable member for Riverina says, it would indeed be the lowest in the Western world, and the lowest in more ways than one. In the field of crime and suspense, Australian productions account for 1.3% of the total on the commercial stations and 0.4% on the national stations. I turn now to current affairs, the area in which this particular medium can be most powerfully persuasive. In all the western European countries, in the United States and in Canada a great deal more time is used by the national and political leaders in television discussion on current affairs programmes than we in this country have yet dreamed of. We seem to be afraid of exposing our policies and decision making to criticism. Today on the commercial stations current affairs programmes have an output of 2.5%, which is 1% of the total. On the ABC the proportion is at least 12%. In the field of the arts, on commercial stations the percentage of Australian productions is 0.3% and on the national stations it is 1.7%. That is the contribution we make to culture in this country on our own national and commercial television systems. It is no wonder that the artistic, creative people of this country - the writers, producers, directors and actors - are somewhat dismayed that in 1970 the outlook is deteriorating from what it was in the early 1960s.

I do not intend to continue my remarks very much longer. I think that my points have been made. I commend the various amendments outlined by the PostmasterGeneral. I would like to think that one or two of the suggestions I have made to him, particularly with regard to country stations and the improvement of the local content or the quota, as it is commonly referred to, will receive some sympathetic consideration from the Government. Without any doubt at all, in the technical field we have reached a degree of excellence in television and in radio which is reached in few other countries. Unfortunately in the creative area we are lagging sadly behind. The time has well come when we should have an amalgamation of that technical excellence and our creative productivity - our inherent genius in creative productivity. If these 2 forces can be brought together then the television industry in Australia and the whole mass media of television will be something in which we can participate and of which we, as Australian people, can be proud.

Mr IRWIN (Mitchell) L5. 42]- Before I refer to the various provisions of the Bill 1 want to say how pleased I am that 1 am not receiving a mass of letters, such as I was receiving up until 6 months ago, about the presentation of programmes of a political nature bearing in one direction. At that time whenever I attended a public function 1 was asked: ‘What are you going to do about the Australian Broadcasting Commission?’ I am pleased that the position has altered because evidently the programmes now being exhibited meet with the approval of the general populace. As the honourable member for Franklin (Mr Sherry) said, it is difficult to define bias, because such an interpretation differs according to thinking and standards. I am sorry that the copybook was blotted recently after the Returned Services League Congress at which, unfortunately, a proposal was put about the listing of Communists. We know that this would not be desirable or possible for various obvious reasons. However f took exception to a programme that followed this Congress. It must always be remembered that in Australia, perhaps more than in most countries, our fighting men and ex-servicemen have always been held in the highest esteem. It hurt me to see the serviceman being depicted as a lair with 2 cans of beer in his hands with a chap at a piano, hat on and pipe in his mouth, playing a parody from one of Gilbert and Sullivan’s musical operettas. This was unfortunate because when a person insults an Australian serviceman he insults himself. I am sorry that this programme was presented because during the past 6 months seldom have T received any letters of complaint about programmes.

The delegation that is proposed in the Bill conforms to general business practice. The proposal is most desirable. It seems that such an amendment should have been moved before now. Regarding the disposal of or purchase of property, I agree that the present limit of $40,000 is not realistic.

In 10 years even the $100,000 proposed may not be sufficient. I feel that many people do not know the extent of concessions applying to licence fees. The Act is to be amended so that concessions will apply to the person who is in receipt of a Service pension, or a pension in respect of total and permanent incapacity, under the Repatriation Act 1920-1969, the Interim Forces Benefits Act 1947-1966, the Repatriation (Far East Strategic Reserve) Act 1956-1966, the Repatriation (Special Overseas Service) Act 1962-1968 or regulations in force under the Native Members of the Forces Benefits Act 1957-1968; or a pension under the Seamen’s War Pensions and Allowances Act 1940-1969 corresponding with a pension in respect of total and permanent incapacity under the Repatriation Act 1920-1969. f trust that those people who are entitled to concessions and who have heard me speaking will ensure that they gain those concessions when they pay their licence fees.

I do not say this critically, but it is unfortunate in some ways that instrumentalities like the Australian Broadcasting Commission which receive their revenue from the Government should not be more careful in expending that money, ft seems to me that there is an easy come easy go attitude in the ABC. It does not have to earn its income as do the commercial stations. lt gels its revenue from the Government and naturally with money received from this source it is the same old story - sufficient consideration is not given to expenditure, f point out that a team of photographers and others went to Tahiti at great expense to make a programme, lt was reported to me that the programme occupied a minute of viewing time. No commercial station would be able to do that and it is essential that the cost ratio be taken into consideration. Of course there are occasions when it is necessary for television teams to go to South East Asia to make programmes. A Minister may be visiting the area or some other matter of concern to Australia may arise which makes it important for a film to be produced there. In such circumstances costs should not determine whether such a film should be made. However before there is huge expenditure of money the cost and the value to Australian viewers should be considered.

I am sure we all would like to see greater Australian content in our programmes. It must be remembered that we are a very young nation and that we are making our traditions and our history now. The greater the local content, having regard to our cultural background which, incidentally, is improving all the time, the better. I say without hesitation that our appreciation of culture has improved since we have had such a huge inflow of migrants from overseas. We are now taking a deeper interest in cultural affairs and have a better appreciation of the classics than we had before. As a result of the support that is being given to the arts and to culture we are able to see aspects of them displayed and featured more frequently than has been the case in the past.

I turn now to television. Within the past week the manager of a country television station has stated that the most his station could attract in advertising was $2,000 an hour. He needed that amount to break even. Any programme which would attract only $2,000 an hour would be very minor and insignificant. There is a big difficulty to overcome but difficulties are there only to be overcome. Australian stations are Australian owned and it should be everyone’s desire to produce Australian programmes comparable to those which can be purchased overseas. Such programmes would benefit Australia by building up interest in this country and by creating an Australian nationalism of which we all could be proud. I think the tendency is in that direction.

Debate (on motion by Mr Armitage) adjourned.

Sitting suspended from 5.54 to 8 p.m.

page 463


Second Reading (Budget Debate)

Debate resumed from 18 August (vide page 93), on motion by Mr Bury: That the Bill be now read a second time.

Leader of the Opposition · Werriwa

– I move:

That all words after ‘That’ be omitted with a view to inserting the following words in place thereof: ‘this House condemns this deceptive and negative Budget because it fails to meet the real needs of the Australian people, especially with respect to (a) standards of social service and war pensioners, (b) assistance to schools, hospital and urban authorities and (c) restructuring of stricken primary industries and because it introduces and increases taxes and charges of a regressive and inequitable nature’.

Let me make it clear at the outset that our opposition to this Budget is no mere formality. We intend to press our opposition by all available means on all related measures in both Houses. If the motion is defeated, we will vote against the Bills here and in the Senate. Our purpose is to destroy this Budget and to destroy the Government which has sponsored it. We reject the Budget but even more we reject the philosophy behind the Budget. It is based on a philosophy which would perpetuate all the injustices and inequalities of years of Liberal rule, and would perpetuate new injustices and new inequalities. We deplore the direction this Budget would take Australia. It contains a marked shift towards privilege, towards inequality. In its social implications it is the most reactionary Budget since the 1930s. Yet, as the respected and perceptive Financial Editor of the ‘Sydney Morning Herald’ has pointed out, it is also revolutionary - revolutionary in this respect, that, more than any of its recent predecessors, it builds into the financing of this nation’s affairs an unprecedented reliance on indirect, usually unjust, taxation. We oppose and deplore the social implications of this Budget as much as its actual contents; and we have no choice but to oppose it by all the means at our disposal. We believe that every best instinct and every ideal of the Australian people is against this Budget. The conscience of the nation itself is affronted by it.

The economic strategy behind the Budget is by no means clear. The political strategy behind it is all too clear. The Prime Minister (Mr Gorton) and the Treasurer (Mr Bury) worked on two very crude assumptions - that the majority of the Australian people are inordinately greedy and inordinately stupid. The Gorton Government thought that greed would be allayed by the spectacular gesture of tax cuts; it thought that the wage earners receiving these tax cuts would be so selfish that they would ignore that they were receiving them at the price of rank injustice to all the underprivileged sections of the community. It was assumed that they would pocket the cash and their conscience together. Yet at the same time it was apparently believed they would be so foolish as not to see that any concessions by way of direct taxation would be, for the great majority of them, more than outweighed by new indirect impositions and even further by the price rises which result from those impositions. 1 believe that the events of the last few days have shown that the Australian people are neither as selfish nor as foolish as the Gorton Government assumed; but let us put it to the real test; let us take this Budget and the Government which produced it to the people themselves. The Parliament has already voted supply to the end of November. By that time, there can be an election for both Houses. An election therefore would cause no disruption. The only thing that will cause disruption is the continuance of this Government.

The Prime Minister asserts that his Government already has a mandate from the people for this Budget. The Treasurer claims that the proposal to reduce personal taxation performs the Prime Minister’s promise of last October. Indeed he boasts that the proposal more than fulfils the promise, lt does nothing of the sort. In the first place, the promise was never understood by the people merely in terms of a simple tax cut. The people wanted reform as well as relief, and enduring reform more than temporary relief. Everyone knew that, because the Liberals bad left the tax schedules unchanged since 1954, low and middle income earners had been forced by inflation into inordinately high tax brackets. The average wage earner in 1954 took 5 weeks work to pay his tax; in 1969 he took 9i weeks. The Budget leaves the unfair incidence of taxation unchanged, lt contains a proposal to reduce tax on all incomes up to $32,000. Happy the country where $32,000 is a middle income! But all incomes below $10,000 are treated in exactly the same way - a flat rate cut of 10%. This has nothing to do with the question of a fairer incidence of taxation - a fairer distribution of whatever fax must be collected.

Inflation and consequential wage rises will immediately begin to operate in the same way that they have done for the past 16 years - against the low and middle income earners. The immediate cash advantage begins to be eroded immediately, because the system remains essentially the same. Despite the Prime Minister’s promise, despite the emergence of a new Treasurer, despite a year of work by the Treasury, we are no nearer a real revision of the tax schedules, no nearer justice and equity in personal taxation, no nearer that fairer redistribution of wealth and fairer distribution of burdens which should be one of the prime objects of taxation in an enlightened community. The former Treasurer, the present Minister for External Affairs (Mr McMahon), conceded last year that Australia’s tax schedules were the most disproportionate in the world’. That is his phrase. If so, they stay so. This Budget changes nothing proportionately or fundamentally. Thus we are continuing with a system whereby the top 10% of income earners paid 58% of ail personal taxation in 1954 but only 44% in 1968-69, where the top 1% paid 30% in 1954 but only 151% in 1968-69.

The grossly unequal distribution of the burden remains; the grossly unequal distribution of the benefit, such as it is, intensifies the injustice. The average wage earner with a taxable income of $3,000 is to receive a reduction of $46 - less than $1 a week. The man on §10,000 receives $348 - nearly $7 a week. The man on $16,000 - the income which to the Prime Minister, according to his election promise, represented a middle income - receives $500, or $10 a week. These are the figures for single men. The benefit for family men on comparable incomes is lower. The average family man with a wife and 2 children with a taxable income of $3,000 receives a benefit of $32. The man similarly situated but earning $16,000 receives $492. In all this there is not the slightest pretence of equity, not the slightest attempt to distribute benefits according to need, nol the slightest effort to protect the family man and the genuine middle income earner against the raids which the rest of the Budget makes on his standard of living. The Treasurer’s proper task was to minimise future erosion of the value of wage increases through unfair tax, and to achieve this by fairer graduation of the tax scales. It was far more important to produce justice than to reduce the total tax. At great loss to revenue, the Treasurer has managed to produce only great injustice. The public were entitled to expect a meaningful tax reform, not just partial and partisan tax relief. They have not got it. So much for Liberal promises! So much for the Liberal mandate! A Liberal Budget indeed: SIO if you are among the top 1%, Si if you are in the middle, and 50c if you are a pensioner utterly dependent on the community for your income. A Liberal Budget indeed - divisive, disruptive, sectional, the true child of the most divisive government this nation has had since the 1920s.

New Indirect Charges

There was certainly no mandate for the imposition of the new and regressive forms of taxation contained in this Budget. There was certainly no mandate for a massive change in the balance between direct and indirect taxation. For the average and below average wage earner, especially those with families, the new imposts will more than cancel out any temporary cash gain through income tax reduction. Seventy per cent of taxpayers will be worse off. The lower income group will be drastically worse off. The new charges specifically mentioned in the Budget by no means complete the sum of the new burdens it Imposes. As a consequence of these proposals, particularly the increase in petrol tax and postal charges, consumer prices, transport fares, housing payments and council rates will all rise. The price passon process is already operating.

Effect on Families

I have had a table prepared comparing the benefits and charges contained in this Budget as it affects families. It is based on the Macquarie University survey of consumer expenditure. Naturally, the table involves a number of assumptions, even guesses, about probable family spending on the items taxed in the Budget. One of the reasons why, in these matters, one has to rely on non-official surveys is that the Government itself will not or cannot obtain the proper information. But I suggest that the table is irrefutable as regards the general trend it shows. Families will be able to see how closely it tallies with their own experience. I would be grateful if the Treasury would be willing to provide such a table itself with such corrections in detail as it may feel necessary. But the conclusion is clear and it is this: Seventy per cent of Australian families are worse off because of the direct and immediate consequences of this Budget, and the poorer a family is, the worse it is affected. With the concurrence of honourable members 1 incorporate in Hansard a table on a survey of consumer expenditure.

Source - Derived from 'Survey of Consumer Expenditure Australia Wide 1968' - Survey Research Centre 1969. {: type="a" start="a"} 0. Distribution by income grade in survey of Consumer Expenditure. Cb) Expenditure by income grade of survey items 23, 34, 35. lc) Assumption that average family includes dependant wife and two children. Survey showed that 70% 0fall householders had wife and children under 17. (d) For those taxes which can reasonably be derived from the survey's categories. te) Based on 7% increase in 90% of survey item 13 showing average annual expenditure by income grade. 1. Based on 2% increase in 90% of survey item 5 showing average annual expenditure by income grade. 2. Based on 5% increase in 50% of survey item 7 showing average annual expenditure by income grade. 3. Based on 2% increase in 90% of survey item 24 showing average annual expenditure by income grade. 4. Assumed that two-thirds of company tax increase will be passed on. Of course, the Prime Minister was right enough last Thursday in saying that low income earners and pensioners need not be affected - as long as they do not purchase the taxed goods. This was the Prime Minister's implication: Why should pensioners smoke or drive or shave or even tipple? But is not this precisely what all our talk in Australia about standard of living is about? Is not it precisely in the ability to buy such items that the difference between subsistence and a decent existence lies? Credit Squeeze The Treasurer suggested on television after his Budget Speech that the social priorities of the Budget had to surrender to economic necessities this year. Yet he himself concedes in his Speech that the Budget is not the sole factor in determining the state of the economy. And, indeed, it has not been the principal economic instrument chosen by this Government itself. One would scarcely realise from the Budget Speech that there had been a savage credit squeeze this year. No such credit squeeze was indicated in last year's Budget Speech. The Prime Minister's policy speech was certainly silent about any such possibility. The Governor-General's Speech was equally silent last November and last March. The Minister for External Affairs interjects. At least if he had still been the Treasurer he would have been willing to make a statement about it in the House and have it debated. At least he was an articulate Treasurer and, comparatively, a frank one. And yet the credit squeeze and its consequences have been the main features of the economy this year. On the monetary policy there has been no debate, no information, no statement. Yet its economic and social impact has been every bit as significant as anything in this document before us. The chief target of that credit squeeze has been the housing industry. The same people who suffer most and benefit least from this Budget bear the major burden of the Government's interest rate policies. They are the people least able to afford to bear them. They are the people least able to escape from the consequences of Government decisions. In Victoria, pensioners are now required to pay an additional $1 a week rental for Housing Commission homes. They depend entirely on this Government for their income; they have received an additional 50c. They are the tenants of the State Government; they are obliged to pay another $1 in rent. For them, there is no escape, no alternative, no choice, no 'freedom of enterprise'. Housing Interest Rates Just as the Budget proposals build into the system a permanent imbalance between direct and indirect taxation, so the Government's monetary policies - relying entirely on raising interest to record levels - have built in permanent burdens on consumers, especially home buyers. Interest rates have never been higher. Ever increasing interest rates have become a characteristic of Liberal policy. As far back as 1958, the then Governor of the Reserve Bank, **Dr Coombs,** said: >In an economy where full employment is successfully maintained by a high nile of capital development, there ave unlikely to be frequent occasions when market; conditions will of themselves produce a major fall in interest rules. Since then rates of interest have been increased on 5 occasions and reduced once - 7 years ago. in the credit squeeze of 1970, housing bore a disproportionate share of the shock. Housing approvals dropped 9.3% over the first 6 months of this year compared with the last 6 months of 1969. Office block approvals rose 70%. The monetary policy had the same thrust as the fiscal policy as expressed in this Budget - first against the less privileged groups of our community, then with scarcely less force against the modest income groups. As a direct result of this Government's policies, 75% of all housing loans from institutional lenders required substantially larger payments of interest than repayments of capital; the interest is greater than the loan. One home buyer in every 4 - economically the least privileged - has to pay more than a third of current average weekly earnings as his outlay on housing. The April increase by the Commonwealth Savings Bank on home loan interest rates has meant an increase of 90c a week for a married couple buying a new home and obtaining the maximum loan of $8,000 over 26 years. In other words, the same people are paying over and over again for the consequences of the Gorton Government's policy, be it monetary or fiscal, credit policy or Budget policy. Those most disadvantaged by one set of decisions are those least advantaged by the other set of decisions. Health Tax Yet this miserable story does not stop even here. There have been other decisions of this Government which have imposed sectional handicaps on the people, and impose the greatest handicaps on those least able to pay. The most notable - notorious, rather - imposition flows from the Government's determination to prop up its costly and inefficient health scheme and its refusal to set up a single public fund to which contributions are determined by ability to pay. By maintaining the fiction that people are free to choose whether they join the scheme or not, by pretending that people are not in fact compelled to belong to one or other of the so called private funds, the Government is able to exclude personal contributions to the scheme from Budget considerations. In reality, of course, increased contributions under the revised scheme are as much a tax on persons as any other tax mentioned in the Budget. In practice, there is greater compulsion to pay the new charges for health than to pay any of the indirect taxes in the Budget. The health tax is almost as unavoidable as the income tax itself. So increased health contributions have to be added to the charges of this Budget. Receipts Duties Then, in this continuing story of inequity, we come to the most mysterious part of this Budget - the receipts duties. Here is the orphan of Australian financial arrangements. No-one accepts paternity; no-one accepts responsibility. Or so it seemed until last Tuesday night, when the new Treasurer did accept responsibility for it, on behalf of the Government, in the most solemn and definite terms. I do not know if I can reproduce his oracular, funereal tones but these are his words: I wish to state that the Government will intro duce as part of the Budget legislation to impose receipts duties, the revenue from which will be for the benefit of the States. Ever since then, we have been endeavouring to discover what this means or, more to the point, what the Government means by it. One assumes that it means something. Surely, it is no accidental phrase. And the clear meaning of the Treasurer's statement is that the receipts tax is part of the budgetary policy of this Government. If words have any meaning, if parliamentary forms and precedents have any force, surely the statement signifies that the Government accepts it as a government measure - a vital government measure. If not, why say it? Whose bluff was the Treasurer calling? A Commonwealth Tax The fiction that the Commonwealth Government has no interest in or responsibility for the receipts tax will wash no longer. It was a threadbare enough argument even last June, when the Parliament first rejected this tax. The Treasurer has chosen to re-introduce the tax in the very form in which it was previously rejected. But this time it is to be 'part of the Budget', as the Treasurer says. Clearly then, with due warning and knowledge of the consequences, the Government has chosen to make this tax part of its own budgetary policy. If the tax is rejected, an important part of the Government's own budgetary policy is rejected. I would have thought that the consequences were quite clear if this Government is to retain any credibility. The Government should accede to the decision of the Parliament that it will not permit the Government to carry out its policy - and put the whole matter to the people. If. on the other hand, the Bill for the receipts tax is passed, let there be no mistake where the responsibility for such an imposition rests: It rests right here with this Commonwealth Government, which has accepted full responsibility for it. lt will be a Commonwealth tax. ft will be a Commonwealth responsibility. It will be a tax imposed by this Government on the responsibility of this Government, fully as much as any other tax measure in this Budget, lt would be as dishonest for this Government to disclaim responsibility for this tax as it would be for it to disclaim responsibility for the level of any of its other taxes. It has been the deliberate choice of this Government to raise, by this particular means, the money needed to carry out its obligations to the States. There was no obligation upon the Commonwealth - no undertaking by the Commonwealth - to impose receipts tax; the obligation, the undertaking, is simply to compensate the States for the loss sustained through the High Court's decision. This is not now a States receipts tax; it is a Commonwealth receipts tax. It is a Commonwealth tax and a Commonwealth responsibility. The real importance of the receipts tax is that it illustrates everything that is wrong with this Budget and everything that is wrong with the Liberal approach. This is what makes it crucial. It happens to be that part of the Budget most likely to be rejected; but in itself it exemplifies all the reasons why the whole Budget should be rejected. Revenue for Officialdom Of all the taxes and charges in this Budget, the receipts tax is the most extreme example of the regressiveness of indirect taxation. It is unjust to individuals; it is unjust to companies. It is unjust to individuals because it is passed on in price rises in all goods; it must be borne by all consumers irrespective of their ability to pay. It is unjust to companies because it is levied on each transaction irrespective of profit. It is a highly expensive form of tax to collect and a highly expensive form of tax with which to comply. Combined injustice and inefficiency is the Liberal way summed up. So, in the first place, this tax is a particularly offensive example of the new imbalance between direct and indirect taxation. Secondly, the receipts tax is the most obvious example of the temporary expedients and short term shifts which are distorting the economy because of the breakdown of our tripartite system of government - the collapse of responsibility in relation to Commonwealth-State-civic finances and functions. Thirdly, the receipts tax exemplifies the fundamental fraudulence of Liberal budgeting; it just underlines how false and futile the present approach to finances and functions really is. This measure and this Budget are Liberal theory and Liberal practice at the end of their tether. This nation just cannot go on this way: We have reached the end of this road. The Sanctity of Budgets One reason why debates on budgets are so sterile in this Parliament and indeed generally in the country is that everybody seems obliged to accept the false premise that the framework of revenues and expenditures, of deficits and surpluses, in each Budget is something fixed, something sacrosanct, a dispensation from on high. So, for example, an honourable member protesting at the disgraceful level of pensions in this Budget will be accused of wishing to cut back on, say, defence. The Government will ask: 'Where is the money to come from?' We are asked to believe that there is some magic about the figures submitted to us. We are asked to believe that there is some great authority about the Government's estimates. Nobody regards it as particularly discreditable for a Prime Minister to assert that a health scheme will cost an additional Si 6m while his Treasurer - the one he picked out - tells us it will be $3 5m and while all indications are that its cost will be many millions of dollars more than that. On the other hand, it is fair game in an election for the Liberals to produce all sorts of costs for Labor's proposals within 24 hours of my policy speech even though we tried in vain for months previously to obtain the official estimate of the very proposals we made. Further, we are asked each Budget time to believe that there has been a precise and unquestionable calculation on each and every Budget item. We will be asked to believe this again this year even though last year revenue exceeded estimates by $87m. We are asked to believe that each item has been established after a careful calculation of its economic impact and that the Budget as a whole is carefully designed to reach a definite economic result. We will be asked to believe it again this year, after a year in which the major economic measures were never in the Budget at all but rather represented the price the people really paid for that Budget. What is magic about the figure of $289m as the cost of tax reductions? What special economic insight went into the decision that a flat 10% cut was exactly what the present state of the economy required and permitted? The truth is. of course, that much of what passes in a Budget for economic decisions are political or social decisions. Liberal Social Priorities The really significant thing about this Budget is that it shows exactly what Liberal political and social priorities are. The Budget is merely the pinnacle of the whole ramshackle structure of finances and functions which has been built over the last 20 years. It suits Liberals to pass off the annual Budget as the supreme economic document and it suits them to force Australia's economic and social arrangements into the straitjacket of annual budgets. It suits Liberals to do this because it is the best way to restrict government expenditure and the best way to reward their friends, it is the best way to represent all government expenditure as a cost to the community. It helps Liberals obscure the truth that government expenditure is, or should be and could be, the community's own investment in its own prosperity and its own welfare. Thus expenditure on education is kept down because, being government expenditure, it is regarded only as a cost; the loss, the permanent loss in talent and skills and opportunities, the loss that will occur in productivity over the whole period of a generation's working life, is disregarded. Money spent on pollution control, because it is government money, is regarded only as a cost while the loss to the community and the community's productivity and therefore to government revenue through the ill-health that pollution causes is disregarded. Money spent on urban roads, because it is government money, is regarded only as a cost. The economic cost to the whole community of road chaos is disregarded. The public transport systems in our cities are allowed to run down because to maintain them at a modern level would require federal aid - government money. What citizens have to spend as individuals on cars and petrol is disregarded. Overseas aid, because it is government money, is represented as an outright irrecoverable expense. In each of the 3 years the present Prime Minister has been in office the rate of increase of aid abroad has been lower than in any year since 1961-62. Yet if Indonesia were to collapse we would be asked to provide billions of dollars more for defence. This Parliament and the Australian public must break away from the narrow, restrictive and self-defeating outlook that represents government spending as pure loss and all private spending as pure gain. In the narrow framework of a given Budget one of course can make proposals for the better allocation as between different items of expenditure. For instance, a budget which provides a mere $20m for pensioners but $28m in tax relief for persons earning more than *$1* 0.000 is plainly unacceptable. No Labor government would countenance such a disgrace. This Parliament should not. Tax Avoidance A Budget which reduces tax by $289m but which continues to lose hundreds of millions of dollars in tax avoidance is plainly unacceptable. Significant tax avoidance is an opportunity enjoyed only by those in the higher income groups. People in upper income groups have the opportunities in the form of income which, unlike wages, can bc spread or shifted and they have an ability in the means of hiring tax advice for tax avoidance. There are many forms which this can take, including splitting of income, spreading of income over time, exploiting the company form of organisation, capitalising income to take advantage of untaxed capital gains and arranging to receive income in the form of expense allowances. People who cannot hire expert advice and who have most of their income from wages and salaries must bear a higher proportion of the tax burden. Indeed, the new marginal rates of tax on higher income groups have been changed in such a way as to increase the value of existing tax avoidance schemes by 31% for those on between $20,000 and $32,000 and by 2% for those on between $16,000 and $20,000. The new schedules in fact subsidise tax avoidance. So, even on the basis of existing laws, the Budget does not raise the greatest possible revenue. But the real question is not just one of accounting - of drawing up a balance sheet. The real task - the real objective - ia not merely the better or fairer allocation of the resources of a single Budget but a better and fairer allocation of the resources of the whole nation. Social Welfare One of the most striking illustrations of this point is in that very field of expenditure which is regarded by orthodox Liberals as a deadweight on the community - as a straightout unproductive cost to the revenue. I refer to social welfare. This Budget highlights the impossibility, not to say the immorality, of clinging to the present system of sole reliance on cash payments to meet the requirements of welfare in a modern society - a society which claims to be enlightened and progressive. Under this system those who depend on social welfare payments - the aged, the widows, the sick, the handicapped, the veterans - are not only the victims of Liberal economic policies; they become an instrument in that policy. They cease to be people; they become economic variables. Not only do they suffer most from inflation; they are the first to be denied benefits to prevent inflation. They pay the double penalty. This becomes quite clear when one sees that the ratio of the new pension rate to expected average weekly earnings will fall to 19.3% - the lowest it has been in 20 years of Liberal rule. National Superannuation: Means Test There will never be justice to pensioners as long as their needs have to be met solely by cash payments dependent upon the economic requirements and political requirements of a particular year's Budget. As long as that system continues we will have this demeaning and unmeaning ritual of $1 or 50c annual increments, according to the electoral requirements of the government of the day. Australia needs three things in this matter - an assistance plan to provide counselling, training and retraining at the home and neighbourhood level; a national superannuation plan; and the abolition of the means test. During the last election the Prime Minister rubbished these proposals on the grounds of cost - $ 1,500m for national superannuation, and his own figure for means test abolition which was twice as great as the then Treasurer's estimate. The fact is, of course, that such estimates of such proposals are totally meaningless. What is involved is not a judgment about cost, but a judgment by the community as a whole about its social and economic priorities - whether it wants dignity and security for its retired members, or whether it wants to continue a system which cuts by two-thirds the income of most people immediately they retire, and whether it wants to continue a system which inflicts the humiliations and hardships highlighted in this Budget. Liberals would regard an appropriation for an assistance plan, providing counsel and advice and help in kind, as an absolute cost to the revenue. Yet they will not make the other calculations; the other side of the coin - what does the community lose through the poverty cycle, by which the inheritance of the poor is continuing poverty? We are all impoverished by the poor. What is the cost to this nation in terms of hard money as well as national self respect for the permanent degradation of Aboriginals and the loss of future Australian citizens through the world's highest infant death rate? Self interest should speak if conscience is silent. Costs of Health Scheme The health appropriation illustrates how political decisions by the Government distort the national Budget. The distortion for millions of personal budgets is even greater. Let there be no mistake: The extra $31m in taxation and the extra $24m in increased contributions to medical funds is not a payment for better health; it is the cost of propping up the failing structure of the Liberal health scheme. Australia's 114 separate health insurance funds are to go their opulent ways for yet another year. They are again to squander or retain without interference or objection $1 in every $4 paid to them by contributors. Six million dollars of the additional, needless health impost will be plucked from contributors who hitherto have subscribed to the lower fund tables just so that they could qualify for Commonwealth health benefits under the system called 'voluntary'. According to the latest figures with which the Minister for Health **(Dr Forbes)** has been able to supply me, 39% of all contributors have until now been enrolled for tables other than the ceiling table. All these contributors must now subscribe to the single, high-cost insurance table which Liberal ingenuity has devised and to whose members alone Commonwealth benefits are now available. Eighteen million dollars will be squeezed from contributors to the ceiling table, whose weekly rates have been increased by up to 25% despite the Nimmo Committee's conclusion that health insurance contributions are in present circumstances as high as most people are prepared to pay and as many people can afford to pay'. Since the introduction of the Liberal health scheme, contributions for medical insurance have doubled in 4 States and trebled in 2. Hospital Funds Contributions for hospital insurance have doubled in South Australia, Western Australia and Tasmania, and increased in Victoria and New South Wales by 4 times and in Queensland by 5 times. Between 1958 and 1970 the range of hospital insurance contributions has increased from between SI 8.20 and $26 a year to between $57 and $67 a year. In 1958 the daily charges imposed in public wards in most States was $3.60. Ten years later it was $10, and increases are now again under way. Over the same period charges in intermediate and private wards have more than doubled. The Commonwealth benefit for all classes of hospital accommodation has remained since 1958 at S2 a day. If it has cost taxpayers and contributors so much to reform the medical funds, what will it cost to reform the hospital funds? Expenditure for medical benefits rose between 1968-69 and 1969-70 from $49m to $57m, an increase of 16%. If this by no means inconsiderable rate of expansion were to be maintained, we would expect the estimate for this year to be in the vicinity of $66m. In fact, however, the estimate is $98m - an increase not of Si Om but of $41.m, not of 1.6% but of 72%. All this additional outlay from taxation and all the additional burden newly imposed upon contributors could have been avoided if the Government had been magnanimous enough to admit its past mistakes and adopt Labor's proposals for a system of universal health insurance financed by a l£% surcharge on taxable incomes. Labor's alternative health programme will cost Australians no more than the still unfair and inadequate Liberal health scheme cost before its latest ineffectual and costly renovation. Labor would have produced the benefits of the new medical benefits scheme at no greater cost than the old scheme. Civic Finances The largest item in the Budget is the appropriation for payments to the States. The Treasurer claims that the increased payments represent a significant contribution to the 'effective working of the Feder ation'. He boasts about 'a massive diversion of the nation's material resources to help meet the needs of the State Governments'. This is a very partial picture indeed of the problems of operating the Australian federal system. There can be no adequate understanding of the cost to the community of operating this system as long as we look only at the requirements of the Slate governments and overlook the requirements of the local and semigovernment authorities which the States have created. The real question is about the proper financing and functioning of the three levels of government - Commonwealth, State and civic. Civic Government The true picture of public financing becomes clearer when we examine the debt situation of the various levels of government. Since 1947 the Commonwealth's debt has fallen; the debts of the States have increased more than four-fold; local government debts have increased more than nine-fold; semi-government debts more than twelve-fold. In 1947 the debts of local and semi-government authorities combined were just over one-quarter of chose of the States. By 1968. the last year for which comparable figures are available, they were more than three-quarters of those of the States; in less than 5 years at this rate they will exceed those of the States. In 1947 the loan repayments of local and semigovernment authorities were about seven-tenths of those of the States. Today the repayments are nearly double those of the States. Their interest rates now will be the highest in our history because they must be half of 1% above the rate on Commonwealth bonds. Between 1954-55 and 1965-66 the number of cents taken in debt charges out of every dollar received in local government rates rose in New South Wales from 17.6 to 22.2. Between 1954-55 and 1967-68- because the other Slates give figures 2 years later than those the New South Wales Government provides - the number of cents taken in debt charges for local councils rose in Victoria from 9.9 to 15.8, in Queensland from 29.8 to 33.2, in South Australia from 7.8 to 12.7. in Western Australia from 10.2 to 16.7 and *in* Tasmania from 21.5 to 33.8. The statistics Indicate clearly that local and semi-government finances have become a national problem. Clearly figures of this magnitude cannot be ignored in the nation's overall economic management. The Liberal Party Council in its latest manifesto calls upon the Commonwealth to share wilh the States the opportunity to use revenue moneys where necessary for work of a capital nature'. If this is proper for the States, it is proper for local and semi-government. Under the existing set-up, the States create authorities to provide the services basic to every modern civilised community, and then leave them to fend for themselves. The areas with the greatest needs are precisely those with the least resources. The Commonwealth Grants Commission was set up to advise the Commonwealth on the fairest way to help the smaller States provide services equal to those of the larger States. The Commission should now be asked to recommend the amount of Commonwealth assistance required to remove the inequalities in servicing our developing suburbs and regions. Education The Treasurer was nowhere more irrelevant or inconsequential than in his references to education. His only novel proposals were for an additional 1,250 Commonwealth scholarships at the tertiary level and a grant of $250,000 for educational research. Let me place these examples of Liberal innovation in their proper perspective. In 1969 1 university student in every 4 was a Commonwealth scholar and 1 in every 5 of the applicants for university scholarships was successful; at colleges of advanced education 1 student in every 20 was a Commonwealth scholar and 1 applicant in every 25 was successful; at secondary schools 1 eligible student in every 17 was a Commonwealth scholar and 1 in every 8 of the applicants was successful; among applicants for Commonwealth technical scholarships 1 in every 10 was successful. At a time when dramatic increases in demand are occurring in every area of education for which Commonwealth scholarships are awarded, the Treasurer has put forward proposals which will allow even the existing inadequate ratio of scholarships to places to be maintained only in the case of university education. He has done nothing to arrest the steady decline in that ratio for every other area of education. The percentage of successful applicants for Advanced Education Scholarships fell between 1966, when they were introduced, and 1969 from 3.5% to 3.0%. In the case of Secondary Scholarships the decline between 1964, when they were introduced, and 1969 was from 19.6% to 12.4% and in the case of Technical Scholarships it was from 29.5% to 11.3%. In March last year the State Education Ministers decided to undertake a nationwide survey of education needs and, when the State surveys were completed, to formulate a nation-wide plan. They said they would seek the Commonwealth's cooperation to put this plan into effect. The former Commonwealth Minister for Education promptly told one of his supporters that, if some financial matters arose as a result of this survey sometime in the future, the matter could perhaps be discussed by the Premiers and the Prime Minister, but that was looking a good way ahead. Those were his words. By August, when the State Ministers had agreed on the terms of reference for the surveys, he was telling another supporter that this State survey showed how unnecessary it was to hold the national inquiry which the Labor Party had advocated for so many years. In April this year the new Minister assured the honourable member for Oxley **(Mr Hayden)** that the Commonwealth was co-operating fully in the State survey. He later told me that the State Ministers had considered the report at the end of May and hoped to publish it within a month. The Premiers duly discussed the report with the Prime Minister and Federal Treasurer, who rebuffed them. As far as this Budget is concerned, the survey might just as well never have been made. The State Ministers have not yet published it. Australians must now appreciate that while in matters such as health and rural industries it would be possible to achieve much better results for the community and for individuals without increase in our present financial outlay, the provision of proper opportunities in education for all Australians is an undertaking which will cost very much more than any government has so far been willing to find. I am confident that they will appreciate these things and accept the outlay involved if governments will make full and frank disclosure of the facts now in their possession. They will now respond as warmly and willingly to the needs of Australian schools as they responded 13 years ago to the needs of Australian universities revealed in the report of the Murray Committee. Hitherto the strength of the combined force of those who are so concerned, so justifiably concerned - teachers and parents, educationists - has been dissipated by futile and sterile arguments about the twin shibboleths of Stare aid and State rights. The result is that this Government has been able to escape its obligations. This Budget is the consequence of that escape and the children of Australia are its victims. Defence The defence set-up represents the extreme of Liberal confusion of financial, political, social and human values. The defence appropriation makes it quite clear that the Government will not this year be making adequate provision to ensure that Australian armed forces will attract and retain men in sufficient numbers to reach the targets the Government itself has set. The Liberals still resort to conscription to secure defence on the cheap. In fact it is a most wasteful and inefficient system. One may be able to conscript 20 year olds to serve in the ranks but one cannot conscript officers or NCOs. Between 1965 and last year the number of resignations in officer rankings below that of colonel rose from 11 to 64. In the Royal Australian Air Force officers leaving before retiring age rose in number from 33 in 1965 to 81 last year. In the Royal Australian Navy they rose from 13 in 1965 to 22 last year and 33 so far this year. Between the same years the percentage of re-engagement on completion of initial engagement in the army fell from 63 to 47. Yet, rather than treat the armed services as an essential occupation and provide conditions appropriate to an essential occupation, this Government will cling to a system which is socially divisive, grossly unfair and economically wasteful. Allocation of Resources It is clear then that in the Budget itself and all these matters which would be accepted even by this Government as proper matters for government action and government initiatives, there is a basic misallocation of resources. But the malaise goes far deeper than that. There is no recognition in the Budget or in any of the Government's statements of economic policy of the basic problem of efficient allocation of national resources. There is no indication that the Government is concerned with this problem or that it is attempting to assess the impact of its own policies on the general allocation of resources. The availability of input-output tables, the importance of which was emphasised in the Vernon Report, is crucial in assessing policy in this area: They have not yet been produced. Australia has had one of the highest rates of savings and investment but our rate of growth has, until very recently, been particularly slack. I have had prepared 2 tables showing per capita rates of growth over the period 1960-67, the latest for which international comparisons are available, and the ratio of investment to gross national product for 17 industrial countries. These show that Australia ranks 5th on the scale of investment ratio but 14th on that of per capita rate of growth. [ realise that Australia has had a more rapid rate of growth since 1967, but so have many of the other countries in these 2 tables. The tables do show a basic misallocation of resources. With the concurrence of honourable members 1 incorporate them in Hansard: Rural Industry The Budget provides large rural subsidies, including $30m for the wool industry on a once-and-for-all basis. But what would the Government propose if the situation of the wool industry is no tetter next year - and there is not the slightest prospect that it will be? This great industry - still our greatest -cannot live on these short term expedients. Nor can the rest of primary industry. The prospects for Australian external reserves with the mineral export boom should give the Government the opportunity to plan for the long term restructuring of our economy free of the short term balance of payments crises which have disrupted economic policy in the past. Where in this Budget, where in any expression of Government policy, is there any indication that the opportunity - the last opportunity - will be taken? There is none. Excess Capacity There are several sectors of the Australian economy for which evidence exists of inefficient use of resources. Thus the failure of Government planning leads to some firms over estimating market shares and growth of total demand. They waste scarce investment resources by creating excess capacity. In recent Tariff Board reports the problem of excess capacity has been referred to in such areas as alloy steel, high carbon steel and electrical steel, stoves, ranges, sound recorders, printing and writing paper, floor and wall coverings, projectors and several items in the general textile reference. This fundamental deficiency in efficient allocation of resources has been the subject of consistent Tariff Board criticisms for many years. During the 1950s the Department of Trade and Industry did carry out investigations into excess capacity but since then no general information has been produced to guide Government policy in this area. This deficiency should have implications for Government policies, tariffs, subsidies, tax rates and allowances. Tariff One area of Government policy which has fundamental implications for allocation of resources is the entire tariff system. Tariffs do not simply protect existing resources of capital and trained manpower. In their effect on investment decisions, they determine the pattern of expansion of Australian industry. One must look at the tariff as an integrated system for, although each individual tariff may protect particular industries, the system as a whole tends to divert scarce resources away from unprotected sources and those which are protected to a lesser extent than average. The tariff has been and will continue to be essential to the growth of the Australian economy, but the Government's approach, which makes tariff decisions on an over simplified ad hoc basis, tends to impede any attempt to view the tariff system in its entirety and thus prevents an appropriate assessment of the tariff's effects on efficient allocation of resources. Social and Economic Objectives Over and above the areas in which allocation of resources is distorted by monopolistic practices and government policies, it is crucial that the Government take into account social costs and benefits which are not reflected in the operation of the market system: What economists would call 'externalities'. The only area of Australian life in which laissez faire continues to rule is the systematic destruction of the environment. The social costs of urban congestion and pollution must be systematically taken into consideration in government regulatory and taxation policies. These are not minor side effects but represent fundamental deficiencies in the market system. Only a governmental over-view of such regulatory weapons as sales tax differentials can adjust the Australian economy to the misallocation of resources due to such externalities. The Government continues to view sales taxes simply as revenue raising devices irrespective of their effects on efficient allocation of resources. It is time that an Australian government instituted an inquiry into the social policy assumptions behind taxation differentials and other government regulatory weapons. Without such a systematic reassessment we will not even begin to tackle the problem of environmental deterioration. Conclusion So let us look at the Government's economic policies whichever way we will, we come to the same result: Misallocation of resources and mal-distribution of wealth or, in ordinary terms, inefficiency and injustice. The Budget itself is only the most topical and perhaps in some ways the most ephemeral example of what is really the whole thrust and direction of Liberal policies. There is throughout the community a very deep resentment against this particular Budget but even that is part of a more deeply felt resentment and uneasiness that has been growing throughout the community for the past 2 years or more. This feeling is compounded by the knowledge that we are an exceedingly wealthy nation and yet the ordinary men and women, much more the very large under-privileged sections - 1 million of them - are convinced that they are not getting a fair share. This is at the root of the present malaise. It is at the root of current industrial unrest. The Budget can only sharpen this feeling because it deliberately sets out to ensure that burdens and benefits are distributed in a grossly unfair way. Speaking of the American malaise, Justice William O. Douglas has said: >Whatever the problem, those who see no escape are hopelessly embittered. A minimum necessity is measurable change. If this be true, what must be the bitterness of those who depend for their incomes on Commonwealth budgets and arbitration awards? We have had over the last few days a great deal of pretentious and pompous breast-beating, from the Prime Minister and the Minister for Labour and National Service among others, about the wickedness of today's lunchtime rallies endorsed by the ACTU and ACSPA. The proper concern of trade unions and white collar and public service organisations is the living standards of their members and their families. This Budget strikes a severe blow at those standards. Therefore they are very properly and deeply concerned about this Budget. I will pay attention to the Prime Minister's outbursts against employees on the day he denounces unilateral price rise decisions. I shall deplore the so-called inflationary effects of today's stoppage on the day he protests about the inflationary effects of BHP's decision this year to raise steel prices. But concern over this Budget goes much deeper than its immediate consequences; it goes far beyond the ranks of unionists and other employees. This concern is about the deeper significance of the Budget. There is growing alarm at the direction in which the Gorton Government is taking Australia. Under the Gorton Government, Australia is drawing markedly closer to the sort of society denned by J. K. Galbraith as one of private affluence and public squalor, and this Budget itself takes a big stride on that downward path. Further, it ensures that the private affluence will be increasingly maldistributed. In his first year of office we had from the Prime Minister what was to be a welfare Budget. The year 1968 was the year of compassion and last year we had what was touted as the little man's Budget. This year we have a good oldfashioned high tory Budget. I think at last the real John Gorton has stood up. The question for all Australians is whether we stand for a society embodying justice and fairness and equality of sacrifice and equality of privilege. The Budget fairly poses the question. It gives a firm Liberal negative. The people should have the opportunity to answer this question themselves. An election is the only way to give them the opportunity. We have no doubt how they would answer. In such an election, on such a cause, the people would be delivering judgment not only on this Budget, not only on the Gorton Government, but on themselves as a nation. If, as I firmly believe, they stand for justice, for the fair go, they will throw out this disgraceful Budget and with it throw out this discredited Government. {: #subdebate-21-0-s1 .speaker-KIH} ##### Mr DEPUTY SPEAKER (Mr Lucock: -- Is the amendment seconded? {: .speaker-JO8} ##### Mr Barnard: -- I second the motion and reserve my right to speak later. {: #subdebate-21-0-s2 .speaker-JTS} ##### Mr Kevin Cairns:
LILLEY, QUEENSLAND · LP -- For the past 65 minutes the Leader of the Opposition **(Mr Whitlam)** has produced a litter of discontent more reflective of the bearer than of the society which he hoped to describe. We listened for over an hour before we could determine the principles upon which he sought to examine that society which he so badly misjudges, lt was not until the sixtieth minute that we found that the Leader of the Opposition was drawing not upon his own staff to illustrate the principles upon which he made his criticism but upon Professor Galbraith. That is the kind of authority to whom he goes. That is the only economic authority he uses upon which to rest his Budget. The one country in the world which follows the principles of the gentleman whom the Leader of the Opposition quoted with approbation is Canada, wherein his friend **Mr Trudeau** is Prime Minister. It is in Canada that his friend **Mr Trudeau** follows the principles of Professor Galbraith. Let us look at the position in that country where these principles have been put into operation. The level of unemployment is three times that existing in Australia. In some provinces more men have departed from the work force than exist in the work force at the moment. In that country the consistent rate of inflation has been repressive over quite a number of years. Canada's social system and level of social services would not be tolerated for one moment in this nation. But I repeat that that is the country that has followed the principles of the gentleman quoted by the Leader of the Opposition. Let us go a little bit further. Honourable members know that **Mr Menadue** departed from the staff of the Leader of the Opposition one or two years ago. It is interesting to read previous speeches on the Budget made by the Leader of the Opposition. Apart from what he said at the sixtieth minute this evening, he has not since 1967 quoted one principle upon which he, as a prospective Prime Minister, would rest any judgment. Let us be perfectly clear about this. The Leader of the Opposition sees himself as presently being within an ace of being Prime Minister of this country. No longer is it a case of building up an Opposition to be a viable Opposition; he sees himself as being within an ace of taking the role of Prime Minister. One has to examine very carefully the platform and the basis upon which he would seek to exercise that role. I shall refer to his health principles a little later. I shall refer to his misjudged civic needs a little later and I shall also refer at some length to his misunderstanding of the taxation system. But before that position is examined let us look at the society upon which the Leader of the Opposition would seek to rest his own economic management. More important than anything in terms of a Budget or an economic document are two factors that must remain in any society. There has to be a stability in that society and there has to be the principle of economic certainty as to the future. People have to have a certainty as to what they can expect and they have to have a stability upon which to rest that certainty. What is the attitude of this prospective Prime Minister with respect to these matters? What has been his attitude over the last 6 days? His economic proposals can be summed up in I. phrase. He would seek to impose an economic moratorium on Australia. In today's events he had not a little part. He is the first Leader of the Opposition in this country of any party who has depended, for the erection of a platform for his speech on the Budget, upon a series of rallies which have led to preconceived and calculated strikes. The Leader of the Opposition is guilty of that. I shall go through the sequence or events, because they are important. He should appreciate that other men who have had the responsibility of economic management know that stability is important. He should recall the history, for example, of **Dr Schacht** and how the disintegration of his society wrecked his economic management. He should know how in recent times the disintegration of French society wrecked President dc Gaulle's economic management. Whether or not one agrees with that gentleman, the fact is that unless that basis is preserved the engineering of the economic foundations of a nation is as nothing; it does not count. Yet this Leader of the Opposition participated in that kind of event. He proposed that kind of event. He connived with **Mr Hawke** in proposing that kind of event today, and he is guilty of this as no other Leader of the Opposition has been. The right honourable member for Melbourne **(Mr Calwell)** was never known as a conservative in politics; he was known as a radical in politics. He was Leader of an Oppositon for a number of years. He had other parts in politics for a number of years but he was never guilty of that kind of proposal. He never participated in that kind of event in order to shore up a speech of his own. I would hope when one listened to these lists of proposals by the Leader of the Opposition tonight one did not forget the background for them which he deliberately sought to create. Perhaps in looking at the psychological reason for this one can recollect that honourable members opposite are within 7 members of government in this place and it may be, of course, that when they get so close to government their judgment runs awry - their judgment runs astray - and a strange kind of sentiment overcomes them. Need I merely recollect that 15 years ago the late **Dr Evatt** was within the same number of government in this country and his judgment led him very seriously astray. Those on the Opposition side who can recollect a little bit of history, and some do, ought to consider that position. It is incredibly important. It is said that any Budget speech can be dull or dangerous. The Leader of the Opposition, unfortunately, has fulfilled both promises this evening. What was the economic background against which we should consider the Budget tonight? Not one word has been said about the economic background. It has been ignored. There were 4 facets of the economy to which this Budget had to react. They were simply these: The country had a high rate of growth in real terms; there was present an incipient inflation and we all know that - an inflation which members of the Opposition have sought to ignore, and we will deal with that a little later; there was a promise that significant taxation concessions were wanted and had to be given to the Australian community; and, even more significantly than some of these, the States of the Commonwealth of Australia were to receive, in real terms, greater and more resources than they had ever received in any other period, and a greater increase in those resources. Those were the strictures within which this Budget had to be considered and it was considered within these strictures. The Leader of the Opposition referred to taxation. It is the dominant feature of this Budget. There have been great and consistent decreases granted in personal income taxation. Have these been honourable? Have promises been kept? I suggest that the very way in which the taxation concessions have been administered in this Budget illustrates that the welfare principle has been honoured by this Government. The very fact that a rate of taxation concession applies at a higher level for incomes up to $10,000, at a decreasing level to $20,000 and cuts out at a higher level of income, indicates a welfare principle. There are those who say that having granted these taxation concessions not sufficient was given in other terms - in terms of social welfare benefits. That kind of reasoning defies simple logic. One cannot both give and take at the one time. This is probably illustrated more clearly in this Budget than in any other Budget since the middle 1950s. That fact cannot in any way be ignored. After all, almost $2,000m more in personal income taxation was paid last year than was paid 14 or 15 years ago. It is wrong and it is inappropriate to consider that all of this increase in taxation was really an extra burden on the Austraiian community. It was not. There were 3 factors which governed this increase in taxation. There was obviously a greatly increased number of taxpayers within the Australian community. There has obviously been a large, persistent and consistent rise in incomes which have moved people into higher taxation levels. Any progressive taxation system requires that. The third characteristic is that there has been an increased real severity of taxation at some levels. It is only by application of that third principle that the Government can, in fact, reduce taxation as it has promised. But it has also to be borne in mind that the increased real severity of taxation only accounted for something between 25% and 30% of the total increase in taxation levy, and out of that the Government is giving, in a real sense, in real terms, over a full year over $280m in taxation back to the Australian taxpayer. There are those who complain about this. They put their complaints in 2 categories. They say: 'Well, you know, this is not quite right. After all if you are going to give an increased taxation benefit you are going to give more to a person on S5,000 a year than to a person on $3,000 a year'. This is the very argument that has been echoed by the Opposition. 1 remind members opposite that the only way out of that dilemma is to have a regressive form of taxation whereby those on lower incomes pay more than those on higher incomes. ] hope that the consequence of that dilemma will have some attraction for the shadow Treasurer from the Opposition who may follow me in a moment. The second aspect of the complaint is that the problem can be evaded if there is not a progressive system of taxation, lt can be evaded if there is high and increasing indirect rates of taxation which fall on families and on working men irrespective of income. The Labour Party and Socialist parties in Australia, where they have authority, and overseas where they have had authority, and have authority, have consistently followed that principle. We have consistently rejected that principle. So one makes no apologies for the taxation concessions because it follows welfare principles, especially on the levels up to $10,000 a year, and then it follows good economic principles of providing incentives on incomes above that level of income a year. When I talk about incomes above that level, I. include those of a surprisingly large portion of the Opposition in this place and of the Opposition in the Senate. So one should examine what they would say, and examine it very closely. Having said that, this simply means that the Government this year is going to obtain into its coffers rather less than it has in previous years. The expectations for Government revenue are down compared with previous years. This has been a deliberate decision but it means also that this Budget, being a Budget which is a balanced Budget in many ways, becomes simply like a household budget. Any mother, any wife, any father who has to manage a household budget knows that one cannot pay out what one does not receive. This Budget par excellence is the first for a long time which illustrates the simple principle that a government cannot pay out what it does not receive. So when, during an economic moratorium for which the Leader of the Opposition has great responsibility, there is complaint that insufficient is being paid out, let us recollect that the strongest campaign for taxation concessions around Australia has been made by a number of interested groups. The most deliberate campaigns have been made by those associated with the Party opposite. Some of their front men bombarded every member of Parliament here with letters seeking taxation concessions. They even persuaded a number of union secretaries to write to every member of Parliament. The nature of the reply to those inquiries is appropriate. The Leader of the Opposition and his front bench conned these men into pressing for these concessions. One can only reply in this way to union secretaries who have written those letters: lt is rather surprising that men representing workers on rather humble wages because their awards do not provide for particularly high remuneration should say that the thing they wanted most was tax concessions. Litters of letters from trade union officials from **Mr Hawke** down said that. They made tax concessions their first priority. The tax concessions followed some well worn and well recognised social welfare principles and I hope that they will be recognised for what they are. The Leader of the Opposition referred to one other aspect of the Budget. He was concerned with the rises of indirect taxation. He, like a lot of other people, does not like indirect taxation. Who likes any taxation? Who likes any unemployment? Who likes any lack of social welfare? One would have thought from what the Leader of the Opposition said that some of the increases in indirect taxes were anathema to him and contrary to the principles upon which he and his Party have depended and have defended for many years. That is not so. Indirect taxation has always been recognised as being regressive and it is for that reason that over the past 10 years this Government has consistently reduced indirect taxation as a proportion of the total tax levy, except in this year. In this year indirect taxation has risen slightly so that some increases in social welfare and some increases in terms of works could be given. There have been Labor chancellors who have deliberately embraced indirect taxation. The Leader of the Opposition makes a world trip every year. He always makes it after some troublesome conference of his own Party at the beginning of June. It is very wise to do that. He evades responsibility. For example, he leaves the honourable member for Hindmarsh **(Mr Clyde Cameron)** to push his own barrow within the Party. It might be going a little far. I would have thought that when he went to Great Britain he would have had discussions with the immediate past chancellor of that country a Labour Chancellor of Great Britain who, when he introduced 2 years ago massive increases in indirect taxation following the same Socialist principles as are followed by the shadow Treasurer, the honourable member for Melbourne Ports **(Mr Crean),** and the Leader of the Opposition, had this to say: >The old dilemma between direct and indirect taxation presents itself in a peculiarly acute form this year. Yet much of the traditional argument is now, to my mind, largely out of date. Indirect taxation, particularly if used in a selective way, is not nearly as regressive as in the old breakfasttable days. I suggest that the Leader of the Opposition rests in the days which have been despised by the former Labor Chancellor in the United Kingdom whose next remarks were (appropriate because these are the principles upon which a Socialist government rests. He said: >But it would be quite unreasonable for people to express their preference for indirect taxation, and then to regard its impact as a greater reason for seeking to offset its effect by income increases than if the pay packet were to be reduced at source by higher direct taxation. My main conclusion is, therefore, that I ought to look for obtaining the bulk of my additional revenue from indirect taxation- I remind honourable members that this is a Labor Chancellor speaking - but that it should be levied in as selective and non-regressive a way as possible. When this Government has had to levy indirect taxation those are the very principles that it has followed and unfortunately the Leader of the Opposition has not understood them. In one other respect the long speech by the Leader of the Opposition had some relevance. He was concerned, of course, with the problem of housing and with the prob lem of civic costs. We too are concerned with the problem of housing and the problem of civic costs. Housing has declined significantly in this country, but it is perfectly clear from an examination of statistics relating to the weekly rate of lending by banks and by other organisations that housing is presently at the turning point and is at a significant level of increase. We know that the cost of housing for Australian families is great. We know that the direct, the persistent, the annual costs related to housing are something that people do not like. We know that there can be regressive indirect costs in this regard so we try to mitigate them. But what does the Leader of the Opposition do about this? The greatest cost in the period of existence of a house is not the interest rate, not the capital but the cost concerned with the authorities which the Leader of the Opposition on occasions has sought to embrace. I refer to local authorities and local rates. This gentleman has been stunting ever since he returned to Australia, showing concern with these matters. Let us look at what he and his colleagues have imposed in the form of the most regressive costs that occur in relation to housing in Australia. Remember that he considers himself to be within an ace of being Prime Minister. Let us consider what he does where he has authority in regard to housing costs and rates. They are referred to in his speech. One principle follows when this is examined. Wherever the Party opposite has power and authority in local authorities in Australia, the increases in rates have been the most savage on the east coast of this country. Let us consider, for example, the Brisbane City Council, the largest local authority in Queensland - bigger than some State governments. Over the past 5 years the increase in this cost, the worst cost that a working man could have, has been well over 60% in real terms, an incredibly high rate of increase. The attitude to this form of taxation is the important point. We find that in New South Wales the local authority which has been responsible most for this savage charge on householders is not the local authority run by independent citizens organisations, not the local authority that operates divorced from party considerations, but the local authority in which the predominant influence for a number of years has been the Australian Labor Party. For example, within the honourable gentlemen's own area at Liverpool, an area outside Sydney, there has been the greatest increase in this cost anywhere on the east coast of Australia. Those are the principles he follows where he has authority, where bis Party has authority, where his own people for a number of years have exerted the predominant influence. We only ask that when the people of Australia consider him as an alternative Prime Minister they consider what he proposes to do and what he has done in those fields where he presently has some power. Those concerned with a high rate of taxation would be rather daunted by the prospect. I turn to the economic management of this country. We have referred to his mentor, Professor Galbraith. Of course we well realise that his management would be according to the principles of Pierre Trudeau. Who will fail to recollect that earlier this year the Leader of the Opposition, when he had a few words to say about the Prime Minister of Canada, said that the administration of Canada is for us the exemplar? Let me cite the exact words he used and apply them to the economic management of Australia. He said: >I quote the Canadian example of an extraordinary range of those activities in which I urge change in Australia . . . For a much smaller federal system . . . Canada is the great exemplar. He referred to Canada which has a rate of unemployment more than 3 times that in Australia, Canada wherein many millions of people in whole provinces can not find employment. The rate of inflation in Canada has been consistently higher than the rate in Australia. The rate of poverty in Canada has been several times the rate in Australia. In the table which the Leader of the Opposition had incorporated in Hansard during his speech. Canada is placed in a higher position than Australia. The Leader of the Opposition does not know how to make social judgments from the data that is presented to him in the statistical year books of the United Nations. We can only regret the departure from his staff of those who would have been able to inform him on these matters as well as some others. One or two other points need to be made. But before they are made it is worth recollecting that, however we view the Leader of the Opposition, he ought to be aware of what those behind him do with respect to economic management in local authorities, the necessarily stable position upon which an economy must depend, and their attitude to inflation. One recollects what the shadow Treasurer, the honourable member for Melbourne Ports, who will speak in a moment, had to say last year concerning inflation. He would be the adviser of the Leader of the Opposition. On inflation he said: >I suggest that there is in Australia an undue obsession with inflation. Inflation has guided so many monetary policies that we have had to implement and it has guided a lot of other policies which have had to be implemented. The shadow Treasurer should know that nothing hurts those on low incomes more than the misallocation - to use a word which was used so often tonight- of depreciating resources that accompanies deliberately contrived inflation. I suggest that there is in Australia an undue obsession with inflation. Over the past year where there has been some insipient inflation in Australia - albeit very much less than that which applies in a number of other countries - he has s:>id nothing, he has suggested nothing, and he has made no proposal. I would suggest then that the shadow Treasurer ought to seek to answer a number of questions appropriate to his own Party. If he is concerned about inflation, he ought to indicate whether he has a programme on inflation and whether he would follow the policies on income, prices and monetary affairs which some of his mentors have followed in other parts of the world. He ought to indicate whether, in this misallocation or reallocations of resources, defence would suffer and whether a cut in defence expenditure would be seen by his Party in the same way as the Labour Party in Great Britain saw it as a solution to its economic problems. The British Labour Party made great alterations in defence expenditure. The Opposition ought to state tonight whether such a course of action would be a solution to some of the economic problems that it sees. It ought to indicate whether in a system of taxation renewal it would adopt the rate of wage increase adopted, for example, by Canada or the rate of wage increase imputed in the 1970-71 Budget of 7% per year. Is the Opposition to adopt the low one or the one which has been accepted in Australia over a period? The Opposition ought to indicate once and for all which country it regards as the exemplar in economic management. There are decisions which the Opposition must make. Until it makes these decisions, I would remind its members that although they may be within an ace of government, although they may see themselves as being within 7 seats of being in government, another Leader of the Opposition saw himself just as close to government and I would suspect that, merely from that fact, he made incredibly great errors which have cost the Labor Party the government benches for the subsequent 15 years or 16 years. {: #subdebate-21-0-s3 .speaker-JAG} ##### Mr CREAN:
Melbourne Ports -- I would have been very interested to learn from the honourable member for Lilley **(Mr Kevin Cairns)** what he or his Government proposes to do about inflation. It seems to me that this Budget contains no measures which will abate the tides of intiation. If anything, it serves to aggravate the situation. Before I travel these interesting paths of economic analysis I wish to say two things about what might be called the visible aspects of the Budget as against the invisible aspects of the Budget that I am a bit more concerned about. There is anger in the community with the Budget because of the miserly approach that it makes to the problem of age pensions. I make that point first. If we read the documents associated with the Budget we see that this year the Australian gross national product stands at a little more than $30,000m. It increased during the year by $3,000m. I will say something a little later about the nature of that increase. I am not suggesting that $1 per week is the minimum by which the age pension ought to have been increased, but to have increased it by $1 per week instead of 50c per week would have added a sum of $30m to the total expenditure of the Commonwealth. That is one-thousandth of the gross national product or 1 % of the increment that took place during the financial year. Occasionally, apart from arguments of principle, there are things of which one ought to be ashamed socially. If the proposed increase in pensions shows the social perspectives of this Government, I think it ought to look a second time at those perspectives. The second matter about which there is perhaps not anger but disappointment in the community is this: The Government has fumbled this opportunity to make really effective taxation reform. I disagree fundamentally with my friend the honourable member for Lilley. I could not have thought of a worse way of adjusting income tax. Plenty of groans and moans have been heard about it. In a community that has been groaning for years now about the total burden of taxation, to alter the form of taxation that ought to be the crown of the system by giving flat rate concessions all around up to $10,000 per annum seems to me to fly in the face of all the canons of progressive reduction. The amount that is involved in this reduction in taxation is approximately $250m. If the honourable member opposite had asked me how I would reform the taxation scale, I would have said that I would reform it from the bottom up, not from the top down. I would have made adjustments in the family allowance for married taxpayers. The scale of progression has not even been altered. The income tax structure should have been totally reconstructed. This reconstruction should have included concessions. That is all that I wish to say on this subject at this stage. I will have ample opportunity to speak in more detail about this matter when the relevant taxation legislation comes before the House. I wish to look at one or two aspects of the total situation and refer to some of the things that are invisible rather than visible. After all, taxation ought to be a medium of redistribution. Merely to compare one country with another without taking into account what it is proposed to do with what has been collected through taxation does not give a very sound analysis of the situation. I am rather intrigued at the credit which the honourable member for Lilley seems to have given already to Professor Galbraith. I am guided in my understanding of this matter by that reputable journal the 'Australian Financial Review' which, in an article of 18th August 1970, under the heading 'Canada Scene' and the subheading: A chance to test Galbraith's ideas', states: >Canada may be the first country in the world to drop the economic theories of John Maynard Keynes in favour of the ideas of Professor John Kenneth Galbraith. . . . As I understand it, Canada has not started to put bis ideas into action. I do not know whether the honourable member for Lilley is on the mailing list, as I am, for the Canadian Weekly Bulletin'. In the most recent issue dated 22nd July 1970, that publication states: >The Prices and Incomes Commission is now mating regular checks on the prices of the largest retail stores in Canada. if initial markups are found to exceed the markup in 1969. the company involved is asked to reduce its markup or gross profit after consideration of justifiable increases in expenses since 1969. The article further states: >The retail monitoring system has already resulted in the halting of some price increases and, more important, it has resulted in manufacturers, processors, supermarket, department, discount and variety stores being much more aware that any price increase which is to be passed along to consumers must be clearly within the guide lines pertaining to their particular segment of industry. That item goes on to state that there was actually a fall in the consumer price index for May. This is something we would like to see noted in Australia. So much for the situation in Canada. Australia surely is the place which we ought to be talking about and the responsibility for dealing with the problems of inflation lies with the Government which is occupying the Treasury bench again. I want to say something later about the difficulty of judging a Budget at the time when it is brought down. In his opening remarks of the Budget Speech the Treasurer said: {: type="i" start="1"} 0. . the Government seeks ... to produce a responsible Budget, a balanced Budget, a Budget shaped to the requirements of an economy that is dynamic and fast-growing- If this economy is so dynamic and fastgrowing surely the Government could have afforded another $3 Om for the pensioners, but an economy still threatened by disruptive inflation. In summing up the Budget the Treasurer had this to say: >In any case, strong and persuasive though its effects can be, the Commonwealth Budget does not determine the whole course of our economic affairs. I want to say something about some of the things that are not being looked at. This word 'inflation' seems to be becoming the most used word to describe the situation as we find it. As 1 said earlier, it is difficult to evaluate the Budget now because I think that more things are asked of budgets than budgets are capable of sustaining. Despite all the so called new analyses that are available this Budget - more so than budgets for many years - is little more than a catalogue, on the one side, of projected receipts and, on the other side, of expenditure the commitments for which were engaged in quite a while ago. In some ways the only time to determine whether a budget overall is good or bad is when you come to frame the next one. I want to say a little about the last Budget. At least we are able to evaluate what was described 12 months ago as a non-inflationary Budget. During the last year prices rose faster than they did in the previous year - 3.7% compared with 2.5% in the previous year and they were rising in the last quarter at a rate in excess of 5%. The present Treasurer did not frame the last Budget. However, in July this year he referred in a Press release to the Commonwealth budget outcome for 1969-70. He is courteous enough to send me copies of all the statements he makes. That statement reads: >The Treasurer, **Mr Bury,** announced today that the Commonwealth had completed the financial year 1969-70 with a deficit of $7m, compared with the Budget estimate of $30m. One might think that that is pretty close to what the previous Treasurer said but I emphasise what was not said in that evaluation, that is, that there had been a credit squeeze imposed in the latter half or so of that financial year. Surely that credit squeeze must have had some impact upon the result of that Budget. There is another matter to which I want to draw attention although I have not sufficient time this evening to go into it in detail. However, T will have an opportunity to deal with this aspect more fully when a loan Bill is before the House. In the 1969-70 report and financial statement of the Reserve Bank of Australia there is a graph detailing the net holdings of Government securities redeemable in Australia. The holder who got the biggest increment of holdings during that year - the Reserve Bank - shows that in many respects despite the credit squeeze the Government was forced to pursue what in essence in the banking sense was an inflationary policy. This is particularly apparent from the increased holdings by the Reserve Bank of 2 items - 'Treasury notes' and 'Other'. The trading banks held actually less Government securities than previously, as did the savings banks. Those honourable members who are students of monetary theory would appreciate the implication that this would have a tendency to be inflationary. At the present time there are divided opinions as to the state of the economy. I am quite sure that the Treasurer and I would be the first to agree that we do not get unanimity in these things. T would like to pose in opposition to some of the things that have been said here tonight the views expressed in the 'Australian Economic Review' for the second quarter of 1970 and published just prior to the Budget. This is a review by the Institute of Applied Economic and Social Research, University of Melbourne. About public spending the authors had this to say: >Towards the end of the year this effect was reinforced by some monetary measure.'; that we did not expect, nor did we think entirely warranted. 1 have with me quite a number of clippings which could be categorised as stating that business is bad, indicating somewhat the same view. One article headed 'Financial Crisis Looms For Rural Industry' was written by **Mr Tom** Connors of the 'Australian Financial Review', lt was reprinted in the 'Ricemill News'. Another was contained in the July issue of 'Canberra Comments' issued by another commercial undertaking. It reads: > >Results, particularly from some industries, were not up to expectations and stocks rose more quickly than was expected. The bulletin of 20th July of the Associated Chambers of Manufactures of Australia states: >Already there are strong indications that in some areas business confidence is on the retreat and the danger of the economy being allowed to run down too far for too long must he guarded against. The Australia and New Zealand Bank in its monthly survey of business indicators for June 1970 had this *to* say: >At the same lime the concern is that the restrictive measures do not over kill. Selective relief for the housing industry may be required in the interim. I want to talk about the central problem of inflation - for want of a better descrip tion. In a way inflation is the great argument that goes on in the community. Wages versus prices is one aspect; consumption versus investment is another aspect; and efficient overall allocation of resources and labour is another aspect. It is a matter that can be affected both inside and outside the Budget - and in my view mainly outside it. 1 was interested to read a rather frank description - franker than is sometimes found in Treasury publications - in the 'Australian Economy 1970'. Under the heading 'Costs and Prices' the article states: >Wages are the largest element in costs, but by no means the only one. Profit margins, interest rales, taxes and charges all have a direct part in determining cost levels within the economy and, proportionately, can do as much to raise costs as wage movements. At limes, also, external factors, such as export and import prices and exchange rate movements, can have considerable influence, in one direction or (he other, on the domestic price structure. > >What will be said here about the effect which rising wages have had on prices in recent years is not at all intended to imply that they have been solely responsible for the price increases which have occurred, lt is not so. A good many other factors have contributed - larger profit margins probably more than most. Also any tendency for demand lo run to excess quickly reflects itself in the elements making up costs, but the directly consequential rises in wages are the symptoms rather than the causes of the prevailing inflation. I ask: What has been done within the Budget or outside of it to deal with what are popularly described as the causes rather than the symptoms of inflation? The honourable member for Lilley always takes the opportunity to ask the Opposition what it would do. The Opposition does not have to do anything at the moment The Government is in office to do these things and the Opposition is here to say whether it thinks the Government is not doing what is proper. I would say that nothing is being done in this Budget insofar as this major problem of inflation is concerned. Why is inflation a major problem? Anybody who studies this document entitled 'The Australian Economy 1970' will find out. I wish to comment on the effect of last year's Budget. One of the documents I have in front of me, National Income and Expenditure 1969-70, shows that in 1968- 69 the increase in the gross national product, using 1966-67 prices as a common evaluator, was 8.6%. However, in 1969- 70 the increase declined to 5.5%. There were certain reasons why 1968-69 was as good as it was. It reflected a glut in wheat production in particular. Nevertheless, the performance last year was not as good as it was in the previous year. If we had had the same rate of increase expressed in real terms the gross national product would have been some $900m greater than it was. It is certainly a rather peculiar attitude to adopt to be satisfied by a poor performance like that. I have already quoted from a Treasury bulletin, which is a Government publication. I wish to quote a rather curious passage from another Government publication with respect to the question of inflation. I refer to the 1969-70 report and the financial statements of the Reserve Bank of Australia, which were tabled in this House last Thursday evening, and in particular to page 28 of the report. The opinion expressed is purported to be the opinion of the Bank, but when it is all said and done the Bank is only an arm of the Government. The report states: >When the inducement to invest is rising (due, for example, to rising prices or mineral discoveries), failure to allow interest rates to rise lowers the return on non-equity financial assets relative to physical assets and equities. I should point out that I have had some trouble understanding precisely what is meant by 'non-equity financial assets relative to physical assets and equities'. The article continues: >In such a situation, investors can be expected to increase their holdings of physical assets and so, in time, increase expenditures. If attempts are made by the authorities to resist a rise in yields on financial assets, the Bank will be required to provide increasing amounts of finance to achieve this objective. The private sector's ability to spend is correspondingly increased and further demand pressures are likely to ensue. It is clear that, when interest rates rise- This seems to me to be a very bland statement - some sectors may experience hardships associated with increasing costs of finance, a factor which needs to be watched closely. In general, however, difficulties associated with, say, increases in the general level of prices which typically accompany cheap money' policies are likely to be far greater than any hardships arising from an alternative policy of permitting the cost of finance to move to levels determined by market considerations. I would say that market considerations are being allowed to dominate the community, sometimes almost to the extermination of human aspirations and other such considerations. This is the great problem which besets the community. We have a society in which, for good or ill - the Government believes that it is fairly good - the majority of people who derive an income do so as wage earners. Over 80% of the community fall within that category. As the Treasury document to which I have referred points out and the White Paper on the Australian economy shows, wages, salaries and supplements are the biggest single item in the gross national product. They are also the biggest single source of consumer demand. Of course, it is consumer demand which ultimately sets the tempo of the economy. Minerals are wanted. They are taken out of the ground because they are required for manufacture into products which the community wants. It is not simply a question of what wages should be. When one analyses the position in regard to the gross national product one finds that overall standards in Australia are increasing but not everybody is sharing in the increase equitably. Statement No. 7 in the Budget Papers, which is entitled 'Commonwealth Budget Transactions Since 1960-61', indicates that a higher percentage of the gross national expenditure was going to this item of cash benefits to persons - which means social service payments - in 1960-61 than in 1969-70. I intend to place a question on the notice paper about this matter because it is my view that a higher proportion of the population was in receipt of age pensions and child endowment in 1969-70 than in 1960-61 and yet the share of total Government expenditure last year was less than it was 10 years ago. This is another illustration of the distortions which have occurred. The honourable member for Lilley was very clever about the effect of the Budget on the tax schedule. Inflation would not be a problem if everybody's income rose as fast as prices rose, but inflation matters as a social problem because some incomes rise faster than prices, some rise slower and some do not rise at all unless social action is taken at the Government level. This is the situation which has been reached in Australia. As one of my colleagues put it: How can one blame wage earners for seeking higher wages when prices increased 3.7% during the previous year and are rising at the rate of 5% this year? How can you blame them for doing this in a community that is still wage oriented as far as the majority of consuming units are concerned? In default of prices falling, how can you maintain your economic level and take your share of what is called productivity unless overall there is a continuing rise in wage levels? There may be arguments as to the share which each person shall get and there may be arguments as to whether you solve the problems by taking Budget action or banking action but for certain sections of the community these problems have not been solved and in some cases they have not even been examined. If in the jargon of the Reserve Bank interest rates must rise so that hundreds of millions of dollars may be invested in the mining industry, surely this is not sufficient reason for an increase in the interest rates paid by the fellow on the average wage seeking to buy a house. Surely you can insulate one type of individual from another in matters of this kind, even if you do it by means of a separate subsidy. Despite what the honourable member for Lilley said, noi one Western society has yet solved the problem of inflation - that is. to maintain full employment and to avoid a rise in prices. I repeat that I prefer inflation and full employment if the alternative is no inflation but unemployment. At present we have a situation of inflation and full employment. Our job is to redress the distortions that take place. One of the things that can be done in the field of public expenditure - it can be done only by the Commonwealth in a systematic sense - is to cut the cake as between public investment and private investment so as to regulate the distribution as between consumption and investment. A few weeks ago I travelled extensively throughout Western Australia. I observed the great iron ore undertakings being developed in that State. Already more than $500m has been spent on this development and there are plans to double that investment in the near future. I was told by a senior officer of a State department that there is not one full high school in Western Australia north of the 26th parallel. There are schools catering for pupils in first and second years. Having reached that stage the children who live in those expanding towns must go south to further their education. Yet almost next door in Darwin there are plans to build a college of advanced education at a cost of millions of dollars. This indicates to me a faulty allocation of total resources. Surely it is up to governments - principally the Commonwealth, but, through the Commonwealth, State governments and local authorities - to redress this imbalance and to see that private development is at least matched by adequate social development. {: #subdebate-21-0-s4 .speaker-4H4} ##### Mr HAMER:
Isaacs -- -The prime task of a government is to manage the national economy, and the Budget is the principal weapon in this control. Inflation is the dominant problem of economic management in almost all of the main industrial countries, and we have not completely escaped this problem in Australia. In the June quarter, as pointed out by the honourable member for Melbourne Ports **(Mr Crean),** the increase in the consumer price index reached an annual rate of more than 5%. This is too high and it must be damped down. If it is not contained not only will it harm people on fixed incomes but it will also provoke or increase wages turmoil and if it continues unrestrained for too long we will price ourselves out of our export markets which, particularly for manufactured goods and minerals, have been developing so satisfactorily in recent years. Control of inflation is the initial aim of this Budget and by aiming at a domestic surplus of $550m, in conjunction with other measures, this should be achieved. The second aim of a responsible Budget must be tj encourage the expansion of the economy. Under wise economic management our economy has been growing rapidly for many years. Last year our gross national product increased, at constant prices, by 5.5%. Perhaps more significant is the fact that our national product per head of population - the real indicator of national prosperity - increased by 3.2% at constant prices. Maintenance of this steady increase in national and individual wealth must be a central aim of government and this, too, will be achieved by this Budget. The third great restraint in the framing of this Budget was the great increase in grants to the States. The States are responsible for many of the activities which most affect the people - education, hospitals, town planning, housing and redevelopment, and conservation. An improvement in their financial resources was essential, even though it will greatly reduce the ability of the Federal Government to make increased payments in other directions. In reducing personal income tax rates the Government has not only met an election pledge but has more than met it. I can well imagine the remarks of honourable members opposite if the tax rates had not been reduced. In addition to improving the incentive to increase production, the lowering of the tax rates restores to the individual the right to make decisions about the expenditure of his money. Each individual will have more money in his pocket. He does not have to spend it on those goods which are now the subject of increased tax. The increased taxes are justified. In fact, in the case of cigarettes one could make a case for a much higher tax designed not to maximize revenue but to deter people, particularly young people, from smoking. There is no reason in logic why wine should be free of tax when drinkers of spirits and beer are taxed more than Sim a day - and I speak as a wine lover. Moreover, the items such as television sets, cameras and jewellery in the old 25% sales tax scale are luxuries or things that are not essential. Last but not least is the increased tax on motor cars and petrol. Australia spends 6% of its gross national product on private cars and their running costs. This is a higher rate than in any comparable country, and nearly as high as in the United States, which is a much wealthier country. I think that this excessive expenditure on cars is a wrong use of our national resources. Although we have great distances we are in fact the most urbanised society in the world, and that should mean less, not more, need for cars. I think that this small deterrent to the over-usage of cars is justified because their excessive use distorts our town planning, pollutes our atmosphere and wrecks our public transport systems. I am sure there is widespread disappointment that it has not been possible to make a larger increase in pension rates. But the situation must be seen in perspective. Under Liberal governments the rate of pension increase over the years has been substantially higher than the rise in the cost of living. The trouble has been that the starting point in this process, namely the pension rate under the last unlamented Labor government, was far too low. The real value of pensions has steadily improved under Liberal rule and will con tinue to do so as the economic situation permits. Also, last year there was a dramatic easing of the means test. Many fringe benefits, such as the free pensioner medical service, have been introduced over the years. I think what we are achieving would be made clear if pensioners received automatic cost of living adjustments, together with periodic increases as the economic situation permitted. This would also ease the problem of inflation for pensioners for they of all people have least margin for absorbing rises in the cost of living. But it must be remembered always that pensioners have done much better under the present system than they would have done under automatic cost of living adjustments only. It all ultimately comes back to the problem of the importance of the control of inflation. What does the Labor Party propose? The Leader of the Opposition **(Mr Whitlam)** would like to increase payments to war pensioners and social services beneficiaries, to schools, hospitals and urban authorities - all of which are the responsibility of the States anyway - and to stricken primary industries. It was noticeable that in proposing help for primary industries the Leader of the Opposition was careful to avoid specific recommendations. This was wise, remembering the previous Labor Party recommendations in this field. At the same time the Leader of the Opposition would like to increase income tax deductions and eliminate the increase in direct taxation necessary to preserve the stability of the economy. His generosity with other people's money is remarkable. As he asked: 'Where is the money coming from?' In the highly unlikely event of a Labor government coming to power it is obvious where it would come from - from printing presses working overtime. In the very words of the Leader of the Opposition: 'Happy is the country where $32,000 a year is a middle income.' If the present ideas of the Leader of the Opposition are any guide a short period of Labor rule would mean that $32,000 a year would be the basic wage. The Leader of the Opposition seems to suffer from the delusion that centralised bueaucratic control of such matters as health and education would result in economy. All experience shows that exactly the opposite is true. The honourable member for Melbourne Ports **(Mr Crean)** is more responsible in economic matters than in his leader so he contented himself with saying absolutely nothing in support of the economic vandalism of his leader. The economic statements of the Labor Party remind me of a baby - a loud voice at one end and no sense of responsibility at the other. The Treasurer **(Mr Bury)** mentioned in his Budget Speech that he was looking in more detail at other aspects of the taxation system. I should like to draw his attention to the deductions which are allowed before income tax rates are applied. These deductions have remained broadly unchanged for many years and 1 believe many of them aTe out of date and inappropriate. They are also very regressive. An income tax deduction of Si is worth nearly 3 times as much to a man on $12,000 as it is to a man on $2,000 a year. What these deductions are, in effect, is a cash payment by the Government to assist the taxpayer in meeting certain expenses. I believe wc should look very critically at these cash payments to see whether they are socially desirable and whether there are not better ways of assisting people in the lower and middle income groups to meet their expenses. The first area with which I would like to deal is that of medical expenses. There are 3 components involved. The first is the deduction allowed for contributions to medical and hospital benefit insurance funds. 1 have drawn the attention of the House to this anomaly before but I think it is worth repeating. The deduction for medical insurance premiums, coupled with the assistance given to people on low incomes to pay their insurance premiums means, in effect, that we have this situation: People on incomes below $42.50 per week get government assistance to pay nl] their health insurance premiums. People with incomes between $42.50 and $45.50 a week and people earning more than $385 a week that is $20,000 a year - get two-thirds of their insurance premiums paid for them. People earning between $45.50 and $48.50 and more than $92 a week get one-third of their insurance premiums paid for them. The people in between - the middle income earners, that is, those receiving between $48.50 and $92 a week - get least; they have less than one-third of their insurance premiums paid for them. I believe that this pattern is absurd. These deductions allowed for health benefit contributions reduce Treasury revenue by about $31m a year. We should eliminate this as an allowable tax deduction and use the $31m rise in Federal revenue to increase the Commonwealth contributions to the benefits payable and thus reduce the insurance payments of everyone equally. Also, in the new health scheme there is what is called a deterrent fee to prevent abuse of the service. This deterrent fee is the gap between the most common fee and the insurance rebate paid. As this deterrent fee is a fixed amount, obviously it becomes less effective as a deterrent the higher the income of the patient. But by allowing it to be claimed as an income tax deduction it not only becomes relatively less effective as income increases but also the actual financial deterrent is less. I believe there is no ground, in reason or common sense, why this deterrent fee should be allowed as a tax deduction. The final component of allowable deductions for medical expenses is that for payments in excess of the most common fee. If is a vital requirement of the new health scheme that treatment should be reasonably available to patients at the most common fee. There is not, nor should there be, any objection to people seeking treatment from doctors of their own choice who charge more than the common fee. But it seems to me absurd that these people should be subsidised by the Treasury in these payments in excess of the common fee by allowing them to claim it as an income tax deduction. If people wish to have such treatment they should pay for it themselves. A second area where the present system of income tax deduction is unfair to people on lower and middle incomes is in the allowable deductions for children. We give assistance for children in 2 ways* - child endowment and through income tax deductions. I think it is common ground with everyone who has investigated the problem of poverty that probably the best way to reduce poverty would be by an increase in child endowment and we could, at no cost to the Treasury, nearly double the present level of child endowment by eliminating the income tax deduction for children. This would of course make the assistance equal for everyone and eliminate the situation where the assistance - the sum of child endowment and income tax deduction - for a first child, for instance, is $1.29 for a man on a taxable income of $2,000 a year and $3.17- nearly 3 times as much - for a man on $20,000 a year. **Mr Speaker,** the third area to which I would like to draw your attention is that of education expenses. There are many areas of anomaly here, and I should like to draw attention to only one example. Once a student turns 21, all deductions cease for his parents, yet the average age of completing every university degree is now more than 21 years. The final example I would like to quote is the loophole through which Collins Street, or Macquarie Street, or Mugga Way farmers are able to deduct improvements and losses on their farm properties from their income tax. I heard the other day of a professional man - and probably there is not too much difficulty in guessing his profession - who wanted to invest $132,000 on his property last year. As his aim was to avoid income tax, it had all to be in improvements which were fully tax deductible. The distraught farm management consultant had run out of ideas on how he could spend the money because, as he said, he already had super a foot deep over the property and elephant proof fences at intervals of 10 yards. What this man was trying to do was to deprive the Federal Treasury of something like $100,000, so that he could have a capital gain or perhaps an attractive holiday home. This problem of deductions for Collins Street farmers has, of course, been raised before. I remember it being raised by the honourable member for Mallee. The Treasurer replied-- and with great respect, I think he was somewhat disingenuous - that the problem was not as simple as it appeared on the surface. He said a large number of people who are thought of as Pitt Street farmers are, in fact, genuine full time primary producers who have, in the last few years, not earned as much income from their farming activity as they have from the limited number of investments which they have been able to acquire. I am sure that no-one is suggesting that hard-pressed farmers, earning little from their properties and forced to take other jobs in order to keep going as farmers, should be deprived of the tax benefits of their properties. But there is a fairly large group of wealthy business or professional people who are taking advantage of this tax loophole and are in no sense genuine farmers. I would suggest that individuals with a non-farm income in excess of $10,000 should not be entitled to claim improvements or tax losses on farming properties unless they can convince the Taxation Commissioner that they are genuine primary producers. This should not be too difficult for the Taxation Commissioner for he already has a much more difficult and questionable judgment to make in deciding on the intentions of investors on the stock market. I have touched on only a few of what I regard as the anomalies in our present income tax law which bear unfairly on the people in the lower and middle income groups. It is our determination on this side of the House to do something to help these people and we have done a great deal in this Budget. I think we could do a great deal more to this end by reviewing the structure of allowable deductions. It need not cost the Treasury anything. A reorganisation within the existing financial limits would do much to help. I think in the past the Treasury's attitude with regard to these deductions has been to let sleeping dogs lie because if they stirred them up they might get bitten. However, the effects of these deductions is social as much as economic and we should be prepared to look at this closely. The only time these income tax deductions can be changed is when there is a reassessment of income tax rates or when the benefits are being changed as is happening with the health benefits at the moment. Now - this year - is the time to make the change and I commend the opportunity to the Treasurer for the next budget. As I said at the outset, the principal aims of the Government in this Budget must be the control of inflation and to continue the rapid growth of the national product in real terms. The prosperity of each of us depends on the prosperity of all of us. Our ability to do all the things we wish to do - to maintain our security, to improve our housing, health and education, to eliminate poverty, to improve the quality of life - ultimately depends on a steadily increasing national income. This will be achieved by wise economic management and for that reason I strongly support the present Budget. {: #subdebate-21-0-s5 .speaker-KGH} ##### Mr HANSEN:
Wide Bay -- The Budget, which was introduced a week ago. gave the Government an opportunity to honour its pledges at the last general election, it also gave the Government an opportunity to restore taxation justice and social justice. In fact, the Budget gave the Government an opportunity to do just those things which the Leader of the Opposition **(Mr Whitlam)** condemned the Government for failing to do in the amendment he moved tonight to the Budget. The Leader of the Opposition said that the Budget: . . fails to meet the real needs nf the Australian people, especially with respect to (a) standards of social service and war pensioners, (b) assistance to school, hospital and urban authorities and (c) restructuring of stricken primary industries and because it introduces and increases tax and charges of a regressive and inequitable nature. ] am sure that this is also the sentiment of those people who felt so strongly about the Budget that they took time off work today to discuss it and let the people who stand behind the Government know their real feelings. The honourable member for Isaacs **(Mr Hamer)** touched on the subject of taxation reform. Previous speakers had congratulated the Government on a 10% reduction in taxation. However. I believe that what the Prime Minister **(Mr Gorton)** promised and what was understood by the people of Australia to be the Prime Minister's promise not quite 12 months ago was taxation reform and not just a percentage drop in taxation. The matters that the honourable member for Isaacs spoke of deserve the consideration of the Treasurer and of the Cabinet. 1 am not alone in my thinking on this. I have received letters from white collar workers, from the Australian Council of Trade Unions, from people in business, from school teachers - from people in what I would term the low and middle income group - stating that it was their belief that taxation reform was to be introduced. But what was introduced? People in the low low income group earning $2,000 a year or less do not receive an increase in wages equivalent to the 50c a week that was granted to the pensioners. Tn other words, a person has to earn over $2,200 a year to benefit from a reduction in income tax in excess of $26 a year which is the equivalent of 50c a week. Therefore, I do not believe, and I am sure the majority of the Australian people do not believe that the Ligation reform which was promised by the Prime Minister has been honoured. In contrast to this the Australian Labor Party through its 1969 policy speech did promise taxation reform - a review of all sections of taxpayers. The Australian Labor Party said that it would review the tax schedules and make a progressive system of tax apply in practice as well as principle. I note that one of the newspapers congratulated one of its favourite sons from Queensland for being one of the Government supporters - they gave him sole credit for this - who in the Party room had the reduction on income tax halted at $30,000. Looking through the taxation statistics provided by the Commissioner for Taxation - the latest one is for 1968-69 - we find that the highest number of taxpayers over that, period was in the actual income group of $4,000 to $4,999. This group amounted to 475,252 taxpayers. This was the greatest number of laxpayers in any group. But when we get up to the group receiving $30,000 and higher we find that the number of people who receive that amount total only 3,127. Therefore, in one group we have 3, J 27 taxpayers and in the other we have 475,252. I can see no reason for congratulating the honourable member for succeeding in stopping the concession at $30,000. The total income of the 3,127 taxpayers earning $30,000 or in excess of that amount at the time of the report was $153,717,000. [ would submit that this group is well able to take care of itself. As the honourable member for Isaacs has suggested, this group is made up of taxpayers who are in a position to take advantage of all the concessions that are available. I am reminded that the taxation schedule has not been altered since 1954-55, except for a 2.5% levy and the raising of the lower limits for taxation. Yet the average income since 1954-55 and 1969-70 has risen by 100% and the average award wage rate by 70%. In 1954-55 the percentage of income required to pay one's income tax was equivalent to 5 weeks pay. Until the present concessions were introduced this figure had increased to 9.2 weeks. This is not evenly spaced between the income groups. Those on the minimum adult male wage payable under Federal awards currently need to work for 6.2 weeks to pay the income tax on a full year's wages. This can be compared to 3.5 weeks required for a basic wage earner in 1954-55. As this scale goes up the concessions are more in favour of people on higher incomes who are best able to take advantage of them. I am reminded that one of the concessions that has been made is the increase of the amount claimable for insurance premiums. This has been increased to $1,200, which it would be impossible for a man who receives an income of $2,200 a year, and also many others, to pay. I submit that the Government, through the Treasurer **(Mr Bury),** has not honoured the election promise of the Prime Minister to review tax scales and to give relief to the lower and middle income groups. The Budget has been described as a give and take Budget. I believe that it has taken more than it has given. It certainly has done so for the people in the lower income group. While some concessions have been made in income tax a further load has been imposed by an increase in indirect taxation. For a number of years now I, and I am sure other honourable members, have received representations from the cosmetic and toiletry manufacturers concerning sales tax justice. They have pointed out the anomalies that exist in sales tax and what a luxury it is for women to appear beautiful and for husbands to pay for their wives' cosmetics at the current rate of taxation. The cosmetic and toiletry manufacturers were seeking a reduction in the luxury tax from 25% to 15%. Such was not to be their lot. The Budget could be said to favour dogs rather than babies. The honourable member for Isaacs spoke about babies. I do not think the Treasurer gave any consideration to them when it is noted that dog powder is free of sales tax but baby powder is now subject to 271% sales tax. Hair nets are free of sales tax but hair spray which women use attracts sales tax of 271%. Women's gloves are free from sales tax but hand lotion, which they may use instead of gloves, attracts 27* % sales tax. There is a sales tax on luxury items such as motor cars. The honourable member for Isaacs said that people would benefit by the concessions if they did not buy some of these luxury items. He said that some of these things could be left alone, yet we find that this group comprises items ranging from contraceptives to motor cars, from artificial flowers to photographic equipment, and includes electrical equipment and television sets. Many of these things are considered to be ordinary household items. In addition people who own a motor car will have to pay the increased excise of 3c on each gallon of motor spirit. This is estimated to increase the Commonwealth's revenue by $61,100,000 this year and by $71,200,000 in a full year. I draw your attention, **Mr Deputy Speaker,** as the representative of a rural electorate, to the discussions that took place here about 12 months ago when the Commonwealth Aid Roads Agreement was introduced. The Opposition put forward the proposition, which has been part of its policy for quite a time, that the whole of the excise duty on petroleum products should be used for the maintenance of roads. The Leader of the Opposition spoke about the problems facing local authorities in the provision of roads and in the repayment of public money borrowed to maintain the roads for use by motorists from whom the Commonwealth obtains its revenue. Each year the Commonwealth hands back a small amount to the States for distribution amongst the local authorities. It was pointed out on that occasion by a number of speakers from this side of the House that, had there been no increase in the rate of excise duty on petroleum products, the Commonwealth would still finish well ahead on the amount it was making available to the States. The proposed 3c a gallon increase will make sure that it will be so much further ahead. The assistance to be given to primary industry is not in proportion to what is needed. The Budget once again provides a stop-gap form of assistance that goes part of the way and leads people in many cases further into debt and into more trouble by not giving them any real sight of a solution to their problems. In the beginning of his Budget Speech the Treasurer said that the amount proposed did indicate a growth in non-farm incomes. He stressed that farm incomes had dropped over the past 12 months and gave all sorts of reasons for this. 1 believe that the policies that have been followed by the Government over the years have not in any way assisted to relieve the problems facing rural industry today. The problem is not just one of drought. The honourable member for Isaacs said that he did not know what the Opposition's rural policy was. He failed to mention the Government policy, as did the Treasurer in his Budget Speech. He dismissed the whole rural crisis in 10 words. The Government knows and the country knows that Labor's programme in the rural sphere is clear and definite. We have announced our 11 -point wool reform programme; we have spelt out our wheat policy for the present and the future; we have repeated time and again our basic proposals to help local government. Against this the Government has brought the country people to their knees. It has abandoned the farmer, the wool grower, the country business man particularly, and the worker. The Government alone is responsible for the depression in half the countryside, and in the other half it ignores the drought and its hardships. I draw your attention, **Mr Deputy Speaker,** to the assistance that is being given on this occasion to secondary industry. It will receive $272m, which is an increase of $81m on last year's expenditure. The assistance to be given to rural industry amounting to $215m is an increase of $77m from last year, and that includes the large amount of $30m to the wool industry - an industry which is worth approximately $800m a year to Australia. This amount is supposed to solve the problems of the people connected with the rural industry and to carry them over for another year. This has been the hope of the Government over the last 20 years. It says: 'Give them enough to keep them going. Just keep them going a little bit longer. The weather might break. Some of the pensioners might fall by the wayside. Some of them might even win the lottery and go off the pension.' I hope some of them have the opportunity to do that. The Budget that was brought down a week ago does not offer any great solution to the problems that are before us. T believe that the honourable member for Melbourne Ports **(Mr Crean)** stated the position clearly when he said: 'What is the use of all this prosperity, of this increase in the gross national product, if part of the community is being denied a share of it?' I conclude on this note: Australia may now look to the Australian Labor Party for urgent attention to pensions, health, housing, education and the reconstruction of primary industries, all of which are more depressed than ever after 20 years of government by the Liberal Party encouraged and maintained by the continuous support of the Country Party minority. I suggest that it would be in the public interest for the Prime Minister to accept the challenge issued by the Leader of the Opposition. Debate (on motion by **Dr Forbes)** adjourned. House adjourned at 10.41 p.m. {: .page-start } page 492 {:#debate-22} ### ANSWERS TO QUESTIONS UPON NOTICE The following answers to questions upon notice were circulated: {:#subdebate-22-0} #### Parliamentary Procedures (Question No. 681) {: #subdebate-22-0-s0 .speaker-JP8} ##### Mr Berinson:
PERTH, WESTERN AUSTRALIA asked the Prime Minister, upon notice: >Will he consider the setting up of an all-party committee of the House to review the operation of the Parliamentary system and to propose ways in which the role of Parliament in national life might be enhanced and the work of Members made more meaningful. {: #subdebate-22-0-s1 .speaker-KH5} ##### Mr Gorton:
LP -- The answer to the honourable member's question is as follows: >Since the honourable member asked his question, the House has debated (2 June 1970) the general matter of the functioning of the Parliament and members have expressed views on the steps that might be taken to enable members to take a larger part in consideration of proposals brought before the House. The honourable member and I both spoke in that debate. > >Having in mind the work of the Standing Orders Committee of the House, I do not think it is necessary to establish a separate body to review the operation of the Parliamentary system. The Government, however, is sympathetic to the view that measures might be taken to assist members in increasing their knowledge and understanding of proposals brought before the House. {:#subdebate-22-1} #### Hospitals: Fees Written Off (Question No. 904) {: #subdebate-22-1-s0 .speaker-RK4} ##### Mr Hayden:
OXLEY, QUEENSLAND asked the Minister for Health, upon notice: {: type="1" start="1"} 0. Can he state the amount of patient fees incurred in (a) public, (b) intermediate and (c) private wards which was written off by public hospitals in each State and Territory of the Commonwealth in each of the past 5 years. 1. What percentage of the total amount of fees charged was written off in each State. {: #subdebate-22-1-s1 .speaker-KFH} ##### Dr Forbes:
LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. and (2) The amounts of patients' fees written off by Public Hospitals in each State and Territory of the Commonwealth are not classified into Public, Intermediate and Private Ward categories but are only recorded in aggregate by the hospitals concerned. Details of these fees written off and the percentage which they represent of total patients' fees charged for each State and Territory excluding Victoria are as follows: The following factors should be noted in connection with these statistics: {: type="a" start="a"} 0. Accounting procedures related to the raising of charges and subsequent rebate or write-off when fees are uncollectable are not necessarily uniform either as between States or as between individual hospitals within a particular Slate. Hence inter-State comparison is unrealistic. 1. In some States, the statistics embrace certain Nursing Homes as well as Public Hospitals where the details appropriate to the former institutions cannot be separated from aggregate figures. 2. Reliable statistics for New South Wales earlier than 1967-68 are unavailable due to the lack of uniformity in accounting for fees raised and written off by individual hospitals. 3. Fees written off in South Australia do not include those from Country Subsidised Hospitals as these details are unavailable. The exact percentage of fees written off 'in each year is not available from South Australia although the State authorities have advised that the amounts written off would represent between 5% and 7.5% of total pa'tients' fees raised. The amount of fees written ofl in Victoria , In each year ls not available. However, the following table shows the difference between fees raised and fee income received in each of the 5 years to 1968-69: {:#subdebate-22-2} #### Canberra: Cultural Development (Question No. 1160) {: #subdebate-22-2-s0 .speaker-RK4} ##### Mr Hayden: asked the Minister for the Interior, upon notice: {: type="1" start="1"} 0. Did the report from the Senate Select Committee appointed to inquire into and report upon the Development of Canberra, 1955, make recommendations on the cultural development of Canberra. 1. If so, what were those recommendations. 2. What steps have been taken to implement any of those recommendations. 3. In any cases where no steps have been taken, will the Government, give active consideration to those recommendations; if so, when. {: #subdebate-22-2-s1 .speaker-009OD} ##### Mr Nixon:
Minister for the Interior · GIPPSLAND, VICTORIA · CP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. Yes. 1. The Committee recommended that steps now be taken for the establishment of the following institutions in Canberra: {: type="a" start="a"} 0. A National Art Gallery. 1. A School of Fine Art for the training of artists, the intention being that the Government should so endow the school to enable scholarships to be awarded to the most promising art students throughout Australia each year, 2. A National Theatre, for presentation of drama, 3. A School of Drama, established along similar lines to the School of Fine Art, 4. A Conservatorium of Music, 5. An Opera House, which should also be suitable for the presentation of ballet, 6. A National Museum, and that appropriate sites be immediately chosen and reserved lor the various buildings that may be required in connexion with these establishments, and that special consideration be given to the site originally selected by Griffin for some of these institutions. 2. In 1967, the Government authorised planning and design of the Australian National Gallery to proceed. In 1968 an Interim Council was appointed and an architect selected as a result of a design competition. A site for the Gallery was approved in April 1970, and planning and design is proceeding. Although no 'National' Theatre has been established, Canberra Theatre Centre, which was completed in 1965, was constructed on the authority of the Government and with Government funds. A Conservatorium of Music as such has not been established in Canberra. However, the Canberra School of Music commenced operations in August, 1965. 3. In the planning of Canberra, special consideration is given to the siting of buildings of national significance, including those which would house institutions such as the ones mentioned in the Senate Committee 'Report. Space is available in the Central Area of Canberra, including the area selected by Walter 'Burley Griffin for the eventual location of such buildings. The timing of the provision of these institutions will be determined in the light of budgetary considerations, and the competing requirements for other buildings of national significance. {:#subdebate-22-3} #### Hospitals: Maintenance Expenditure (Question No. 1355) {: #subdebate-22-3-s0 .speaker-RK4} ##### Mr Hayden: asked the Minister for Health, upon notice: >What percentage of total maintenance expenditure was represented by patients' fees in public hospitals in each State and Territory in each of the years 1949 and 1969, or the nearest years to these for which figures are available. {: #subdebate-22-3-s1 .speaker-KFH} ##### Dr Forbes:
LP -- The answer to the honourable member's question is as follows: >Figures relating to the revenue and expenditure of public hospitals as presently defined are only available for the years 1963-64 to 1967-68. Included m the public hospital figures for earlier years are some institutions which were subsequently classified as nursing homes following the introduction of the Commonwealth nursing home benefit in 1963. Details of the revenue and expenditure of public hospitals for the year 1948-49 are shown hi Commonwealth Year Book No. 38 of 1951. These figures indicate that patients' fees as a percentage of total maintenance expenditure were: These figures reflect the fee charging policy operative at the lime, i.e., public ward treatment was provided free of charge and charges for intermediate and private ward treatment were set having regard to this factor. Fees for public ward treatment were introduced in all States excepting Queensland during the early 1950s and patients were assisted in meeting these fees through the hospital insurance scheme. Patients fees (excluding the component met directly or indirectly by Commonwealth hospital benefits) expressed as a percentage of total maintenance expenditure (including out-patients expenditure) for the year 1967-68 were: {:#subdebate-22-4} #### Defence Printing Establishment (Question No. 1367) {: #subdebate-22-4-s0 .speaker-JSU} ##### Mr Bryant:
WILLS, VICTORIA asked the Minister representing the Minister for Supply, upon notice: (!) What establishments are being relocated in the Clothing Factory, Brunswick. {: type="1" start="2"} 0. What is the estimated cost of moving each establishment. 1. What staff is employed in each establishment and will any staff become redundant as a result of the moves. 2. What are the anticipated dates by which each movement will be completed. 3. What works of a capital nature have been carried out in the present establishments in last 3 years. {: #subdebate-22-4-s1 .speaker-QS4} ##### Mr Malcolm Fraser:
WANNON, VICTORIA · LP -- The Minister for Supply has provided the following answer to the honourable member's question: ti) With the construction of the new Government Clothing Factory at Coburg, the premises at Brunswick are to be occupied by the Defence Printing Establishment. This Establishment comprises an amalgamation of the printing units of the Departments of Army, Air and Supply. This is a further step in the rationalisation of Defence activities. The units involved are: {: type="a" start="a"} 0. Department of Army - 1 Base Printing Company; 1. Department of Air - Printing Flight of RAAF Printing and Publications Unit; and 2. Department of Supply - Reproduction Section of Central Drawing Office. {: type="1" start="2"} 0. The estimated costs of transferring selected items of plant from each of the existing units to the new Defence Printing Establishment are: 3. Department of Army - $6500. 4. Department of Air- $5000. 5. Department of Supply - $3500. Additionally an estimated $10,000 will be required to cover costs of installation and power connection. {: type="1" start="3"} 0. The number of staff presently employed at each unit on the printing activities which are to be transferred to the Defence Printing Establishment are: {: type="a" start="a"} 0. Department of Army - 44. 1. Department of Air - 36. 2. Department of Supply - 30. It is expected that there will be no redundancies in staff as a result of the amalgamation. Remustering of some Service personnel might be necessary. {: type="1" start="4"} 0. No specific date has been set for the transfer. Detailed planning is currently in hand and it is thought that the entire transfer will take place between December 1971 and February 1972. 1. No works of a capital nature have been carried out at either the Army's 1 Base Printing Company or the RAAF's Printing Flight during the past 3 years. However, the following works of a capital nature have been undertaken in the building occupied by the Reproduction Section of the Central Drawing Office during that time: {: type="a" start="a"} 0. Replacement of worn out air-conditioning plant. 1. Completion of extensions to a store and the photographic sub-section. These facilities will be used by the Department of Supply for other activities. The activities require air-conditioning.

Cite as: Australia, House of Representatives, Debates, 25 August 1970, viewed 22 October 2017, <>.