House of Representatives
12 April 1973

28th Parliament · 1st Session

Mr SPEAKER (Hon. J. F. Cope) took the chair at 10 a.m., and read prayers.

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The Clerk:

– Petitions have beenlodged for presentation as follows and copies will be referred to the appropriate Ministers:


To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned respectively showeth:

  1. That grave concern is felt at the imminent introduction into the Commonwealth Parliament of legislation to extend the situations in which abortions may be legally obtained and which will, it is believed result in a situation in Australia where abortions are available on demand.
  2. That if as some argue the unborn child at the time abortions are performed does not constitute human life, then Justice and reason demand that anyone so arguing has the onus of proof upon him and that this onus has not been discharged.
  3. That all have the right to life and that abortion is not merely another form of contraception but is the deliberate taking of innocent human life.
  4. That while acknowledging that unwanted pregnancies do often present serious problems, the answer lies not in the slaughter of the innocents but in fostering a genuine concern in the well being of all our fellow Australians - with all that entails.

Your petitioners therefore humbly pray that the House of Representatives in Parliament assembled should not admit into the law of this land a principle which violates a fundamental right, the right to life.

And your petitioners as in duly, bound will ever pray. by Mr Beazley.

Petition received.


To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned citizens of the Commonwealth humbly showeth:

That the undersigned believe that,

  1. The duty of Government is to give legal protection to human life before, as well as after, birth. We ask the legal protection be given to the unborn child.
  2. Recourse to abortion lessens respect for human life in the community. We stand firmly against the present attempt to change legislation on abortion.
  3. The responsibility of Government for the welfare of all citizens demands adequate social assistance programs for women contemplating recourse to an abortion.

Your petitioners most humbly pray that the House of Representatives in Parliament assembled should maintain the existing laws covering abortion and your petitioners as in duty bound will ever pray. by Mr Jarman.

Petition received.

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– I direct a question to the Prime Minister and ask: Under the Australian constitutional law, which is supreme - the Parliament or the Executive? Has the Parliament the power to pass laws making authorities established by it directly responsible to the Parliament and not to the Executive? Can the Prime Minister inform the House of those cases where this power has been exercised by the Parliament? Has it done so in the cases of the Auditor-General and the Director-General of the Australian Intelligence Organisation?


– Both the Parliament and the Executive have to operate within the terms of the Australian Constitution. Proceedings can be taken to disallow acts of the Parliament or to restrain the Executive if either acts in defiance of the Constitution. It is possible for the Parliament to pass a law making some authority or person responsible to the Parliament as distinct from the Executive. I believe the Parliament has passed such a law in respect of the position of the AuditorGeneral. I would not like to express an opinion at this notice on the position of the DirectorGeneral of the Australian Security Intelligence Organisation.

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– I ask the Postmaster-General: Will he consider providing, free of charge, television viewing licences to persons born without hearing and to those who lose their hearing at an early age?

Mr Lionel Bowen:

– It is true that such concessions are given to people who suffer from a physical defect. This practice has not yet been applied to those who suffer from deafness. I think that the honourable member’s question has much validity, particularly when we realise that these people suffer from this acute disadvantage not only in the physical sense but also from the point of view of their earning capacity. I think it is a question that ought to be given serious consideration. I have had discussions with my ministerial colleague, the Minister for the Media. He is also of the opinion that some facilities should be extended to these people. In relation to news broadcasts, sign language should be used to indicate to the deaf person what is being said. It would also be appropriate for sub-titles to be used. In other words, in addition to the economic facility of granting licence concessions, other facilities ought to be extended to the deaf. I will do my best to accede to the honourable member’s request.

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– My question is addressed to the Prime Minister. I refer to his acceptance of the call by the Premier of Victoria, Mr Hamer, for a Premiers Conference to consider incomes and prices policies. Does the Prime Minister now realise the impact of ever increasing wages in forcing up prices to housewives, home buyers and all the community? Does he agree that sharply rising wages and changes in conditions of employment contribute more to price rises than profits do? Does he expect that the trade unions will slow down price rises by reducing demands for increased wages and does he expect that the trade unions will call off the crippling strikes now harming the economy and the people of Australia?


– I would expect that all persons in receipt of incomes, whether they are members of trade unions, members of white collar organisations, self-employed or living on dividends, would be less disposed to increase their incomes and to use the means available to increase their incomes if something were done about prices. I am very happy that the Victorian Premier has made a suggestion, which my Government and most of the other governments in Australia have now accepted, to confer on what steps can be taken under our federal system to halt all aspects of inflation.

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Coomealla area, I ask the Minister: Have there been any negotiations between the New South Wales Department of Agriculture and the Federal Government with a view to providing assistance to the growers?

Minister for Northern Development · DAWSON, QUEENSLAND · ALP

– It is true that there have been adverse seasonal conditions in the grape growing areas of South Australia, Western Australia, Victoria and New South Wales, but by far the greatest amount of damage has been done in the Sunraysia area. The figures given by the honourable member are fairly accurate. The best estimates seem to suggest that sultana grapes production will be down by something like SO per cent and the estimated production is around 40,000 tons as against 90,000 tons the previous year. The problem has been caused by unseasonal rains and thunderstorms in these areas. The correct approach would be from the industry to the State Government. If the State Government is unable to finance carry-on loans or special grants to individual producers or to the industry in general and if it thinks this finance is necessary, it could approach the Federal Government. In this case the correct approach would be from the Premier to the Prime Minister. Preliminary discussions and inquiries were made last week and I have been assured that the Minister for Primary Industry will give sympathetic consideration to an approach from the fruit growing areas with respect to this damage.

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– My question is directed to the Prime Minister. So that the Commonwealth Public Service can be completely cleared of the reflections of suspected conspiracy that were made on it and so that the Parliament can satisfy itself as to the correctness or otherwise of the conclusions reached by the Prime Minister, I ask the Prime Minister whether he will table the documents which led him to suspect that a conspiracy existed among public servants to withhold truth from the Parliament and whether he will also table the evidence that led him to rid his mind of such suspicion.


– The members of the Commonwealth Public Service were cleared of any suspicion of conspiracy by the findings of the relevant heads that there had been a wrong report by the Australian Security Intelligence Organisation representative at the meeting between him and representatives of other departments on 2nd March. The decision was not mine. The decision was made by the heads involved. I do not have any evidence other than the document of Sth March. I do not believe it appropriate to table it. The fact is that the heads concerned have jurisdiction in this matter. They made inquiries. They made the decision.

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Mr Keith Johnson:

– Is the Prime Minister aware of concern being expressed in the community at what is interpreted to be a difference in attitude on the part of the Australian Government between French nuclear tests and the tests conducted by the Chinese? Following on his remarks at his Press conference of last Tuesday relating to the jurisdictional aspects of the respective tests, will he make it clear that these comments relate only to our capacity to take legal action and not to the Australian Government’s attitude to all forms of atmospheric testing whether conducted by France or China?


– France, as well as Australia, has accepted the compulsory jurisdiction of the International Court of Justice. The People’s Republic of China has not accepted the compulsory jurisdiction of the Court. Accordingly it is open to France and Australia to take action in appropriate cases before the Court against each other. It is not open for Australia and China to take-

Mr McMahon:

– Under agreement and not unilaterally. There has to be an agreement between the 2 parties before action can be taken.


– I accept what the right honourable gentleman said, that parties can accept the compulsory jurisdiction of the Court on conditions which are laid out in thenaccession to the statute establishing the Court. France and Australia both have accepted, on conditions which they have set out, the jurisdiction of the Court; the People’s Republic of China has not. Accordingly, as I was going on to say, while France and Australia can, in the circumstances which apply in their documents of accession, take proceedings against each other before the Court it is not possible for Australia and China to take such proceedings.

The attitude of the Australian Government is, as I think the attitude of the previous Australian Government was, that France should accede to the nuclear treaty to which the United States of America, the Union of Soviet Socialist Republics and Britain have acceded. There is no difference between the parties on either side of the House on that subject. We believe that France and China, the other remaining nuclear powers, should both accede to the treaty. I made that plain when I was Leader of the Opposition, in conversations with the Prime Minister of the People’s Republic of China in July 1971. The previous Government made that attitude plain in the General Assembly of the United Nations last year. In opposition the Australian Labor Party supported the initiative the previous Government took. Since becoming Prime Minister and Foreign Minister I have stated that our attitude on that is the same. In fact, we have protested to the Chinese Government against its failure to accede to this treaty.

Mr MacKellar:

– When?


– This week.

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– Is the Minister for Northern Development aware of a statement by the Minister for Primary Industry at a meeting of the Organisation for Economic Co-operation and Development in Paris calling for international co-operation in reducing the level of assistance to Australian farmers? ls it true, as reported, that returns to Australian wheat growers in future will be determined by world prices? If so, what effect will this have on the price paid by Australian consumers of wheat? Does the Minister realise that the income of wheat growers during the present 5-year period has been reduced as against the previous 5-year period? Is the Minister aware of the fact that severe grain shortages are predicted throughout the world and that reductions in incentives to grow wheat can only make the situation worse, bringing further hunger and starvation throughout the world?


– I am not aware of the statement made by the Minister for Primary Industry. However, I do know that one of the reasons for the wheat shortage in Australia was the attitude of the previous Government towards small national quotas and towards the first advance payments in relation to those quotas. The Australian Government has demonstrated its faith in the wheat industry by giving its blessing to the biggest national quota since quotas were introduced and also by increasing the first advance payment. The Leader of the Country Party asked a question relevant to wheat stabilisation. I would remind him that the wheat stabilisation scheme in fact was introduced by a Labor government, not a Country Party government. The Labor Government stands firmly behind stability and security of primary industries that are sound - and the wheat industry is a sound primary industry. We also have made it clear over the years that we support the principle of stability in prices on the home market in line with reasonable costs of production. We also believe that there is a need to expand the wheat industry in line with world trade and demand. I can assure the Leader of the Country Party that the policies of the Australian Government will be designed to increase wheat production in Australia, if the world market demands that situation.

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Mr McKenzie:
Diamond Valley · ALP

– Has the attention of the Minister for Social Security been directed to the boycotting action by some doctors of the nursing homes admission procedures introduced by the last Government? How extensive has this boycott been and what action has he taken to minimise any undesirable effects, particularly on those elderly patients who are in urgent need of care and who cannot persuade their doctors to carry out the necessary procedures?

Minister for Social Security · OXLEY, QUEENSLAND · ALP

– I think the first thing to stress is that the procedures for admission are ones which were legislated for by the previous Government. We have inherited this policy and I rather expect, therefore, that the procedures have the wholehearted support of both sides of this House. The procedures in fact have been modified by this Government in the interests of patients. I arranged very early in the piece, as a result of approaches made by the Australian Medical Association, that patients could be admitted in emergency situations if the doctor contacted the Department and indicated the condition of the patient or if the doctor completed the form and gave it to the matron of the nursing institution, to relatives of the patient or to the patient himself - the patient could submit the form to the Department. This was an effort to expedite the admission procedures to the convenience of possible patients.

It has been reported that the AMA has called on the medical profession to boycott the admissions procedure. Figures which have been provided to me by the Department indicate that fewer than 3 per cent of doctors have, in fact, boycotted the system. Nonetheless it is most unfortunate that members of the medical profession have sought to inconvenience members of the public, not only people who are likely to be patients but also their families, in a display of medical politics. I think that members of both sides of the House are aware that at present within the medical profession a vigorous battle is ensuing between representatives of the AMA and representatives of the Society of General Practitioners. In these circumstances the maverick group - the Society of General Practitioners - is seeking every opportunity it can to whip up a frenzy and a sense of concern and alarm, in every case without any justification, among members of the medical profession. This is one of the instances where this is being done. In real emergency situations where a patient will be inconvenienced by a doctor - as I have indicated, only a minimum number of doctors are totally boycotting the scheme - we make arrangements with Commonwealth medical officers to expedite the admission of the patient.

I repeat, it is most unfortunate that there is a trend among some members of the medical profession today to use the public in quite an unconscionable way as part of their program in this struggle involving medical politics. The statement, for instance, of representatives of the Society of General Practitioners that they will withdraw, if it suits them, from the pensioner medical service is a perfect case in point. The people who would suffer are the aged and the infirm - the people who are the most vulnerable and who have the greatest need in the community. Representatives of the Society state that the same sort of withdrawal practices will be applied., if they feel so inclined, to the repatriation medical service. This is a completely unwholesome approach to the whole matter because I point out that the present Government and the previous Government took the same line.

We endorse the principle that the Federal Government has a real responsibility to the public in this matter. This year about $90m of taxpayers’ money will be devoted to the nursing home system as a daily bed subsidy. By 1980 that figure will have climbed to about $400m. Quite clearly there is a very real responsibility incumbent upon all members of the Parliament to ensure that taxpayers’ money is used carefully and responsibly and that minimum demands are made on taxpayers. To the extent that money is available the Government will maximise the benefits for the community. If money is used excessively and unjustifiably in one area, we deprive other areas of need - education, other areas of health, welfare services, community services, environmental factors and so forth.

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– My question is directed to the Prime Minister. In his answer to a question asked last week by the honourable member for Parramatta about one of the previous Government’s letters to the Yugoslav Government, did the Prime Minister attempt to justify his description of that letter as a lie by claiming that not to tell the whole truth is to tell a lie? In his repeated evasions of questions about the reasons for Senator Murphy’s midnight raid on the Australian Security Intelligence Organisation offices in Canberra - an evasion which continued in the debate which was gagged in this House this week - did the Prime Minister, by his own definition of the word, lie and lie, and lie again to this House? Will he now answer this question without lying, as he dennes the word? (Question not answered)

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– My question is directed to you, Mr Speaker. I refer to the recent heavy support from Opposition parties for legislation introduced by the Government, and the subsequent overcrowding which occurred on Government benches during divisions - I instance a certain Bill which was passed here - and the time lost in counting, thus delaying legislation, and the further many occasions on which divisions have been called, also delaying the business of the House. Will you institute an immediate investigation to see what may be done to install an electronic voting system in the House before the next session of Parliament, thus eliminating problems in the future?


-I will give the matter consideration and let the honourable member know at the earliest possible opportunity.

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– I ask the Prime Minister: Is he aware that it is reported that on 28th April a joint delegation of Vietcong and North Vietnamese will be visiting Australia as guests of the Minister for Overseas Trade? If he is aware of this intended visit, will he say whether the delegates will be travelling on North Vietnamese passports or on passports issued by the Provisional Revolutionary Government? If travelling on passports issued by the Provisional Revolutionary Government, will he say whether they will be admitted to Australia? If they are travelling on North Vietnamese passports, will he say how they can pass themselves off as Vietcong, which presumably is an organisation composed of South Vietnamese? If he is not aware of any of these facts, will he cause inquiries to be made and report to the House the result of his investigations?


– I do not know what travel documents the persons to whom the honourable gentleman referred are using. I will find out. I will let him know.

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– Has the attention of the Prime Minister been drawn to an advertisement in the Melbourne ‘Age’ on Saturday, 7th April inserted by the Australian Heritage Society, a division by the League of Rights, in which it is stated that ‘moves are afoot to tamper with Australia’s heritage without the people being consulted’? The advertisement seeks a postal vote on whether people want to change the Australian flag; abolish the Crown in Australia; have the Federal Constitution destroyed and all power centralised in Canberra. If his attention has been drawn to this advertisement, can he assure the people that they will be consulted on these matters if any changes ire intended by this Government? Will he also assure the people that unauthorised persons who tamper with such matters will be dealt with?


– I am not aware of the advertisement although I am aware of the particular branch of the League of Rights to which the honourable gentleman referred. The Australian flag is the subject of a statute. The Government has not considered and is not contemplating amendments to that statute. The monarchy is entrenched in the Constitution. The Government has not considered and is not contemplating amendments to the Constitution in this respect. The prime method of altering the Constitution is by a referendum of the people on a Bill passed by this Parliament, or in certain circumstances, by one House of the Parliament.

The Government certainly would be expecting to give the people the opportunity to modernise our Constitution by introducing Bills for referenda. I would hope that such Bills would be put to referenda the next time there is an election for either House of the Parliament or for both Houses together. In respect of the allegation of centralisation, it is certainly true that my Government will take those steps which it has promised to make national legislative and administrative decisions concerning those matters which can best be done on a national basis. At the same time, of course, it is the first time that I can remember any government taking steps to provide more regional administration in Australia. For instance, we shall be introducing amendments to the Commonwealth Grants Commission Act to give local government bodies direct access to the Commission, and we are also committed to seek the agreement of the States to amend the Financial Agreement so that local government aldermen and councillors in each State can elect a representative to speak and vote for them on the Loan Council.

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– I preface my question to the Prime Minister by saying that the honourable gentleman will recall that one of the reasons for rejecting a royal commission or judicial inquiry into what has become known as the ASIO affair was that it would, to use his own words, destroy the last vestiges of whatever reputation the previous Government and surviving members of it might possibly have. I now ask: If his statement is correct should he not, as a responsible person and as the head of this Parliament, pursue this matter because of the importance of an Opposition in our parliamentary system and because the Australian public is entitled to be acquainted with all the facts?


– I hasten to assure the honourable gentleman, as father of the Aus tralian Country Party in this House, and f think the Parliament, that I do not have in mind any defaults by Country Party Ministers in previous governments. The actions which I have in mind and to which I have referred on several occasions in the last couple of weeks in the Parliament concern former Liberal Ministers. I need not repeat the reasons I gave for holding that a royal commission or a judicial inquiry would be inappropriate. I notice that it is now suggested that High Court judges should serve on a royal commission. They never have. 1 do not believe they ever would.

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– I ask the Minister for Defence representing the Minister for Repatriation and, if necessary, the Minister for Health and the Minister for Social Security: What action has the Government taken to restore the medical benefits of the wives of totally and permanently incapacitated pensioners who were so affected by the last Budget? If the Government is contemplating action, will it as an interim measure consider some benefits for those wives who suffer from long term illnesses, some of whom at the moment are financially disadvantaged by heavy expenditure even if they have joined a medical benefits fund?

Minister for Defence · BASS, TASMANIA · ALP

– This matter is a question for the Minister for Repatriation and the Minister for Social Security. The honourable member will be aware that the policy of the Government is to provide repatriation pensions free of means test. It will also of course abolish the means test within the life of this Parliament and will provide a national health scheme. But service pensions and social security pensions are subject to a means test at this stage, and when the means test provisions have been applied the medical entitlement card, of course, has been taken away from the pensioner concerned. It is a question for consideration not only by the Minister for Repatriation but also by the Minister for Social Security. Discussions have been held on this question, and I believe it is still under consideration. I will further consult with the Minister for Repatriation and the Minister for Social Security in respect of this question. I shall draw to the notice of the Minister for Repatriation the latter part of the honourable member’s question concerning the provision of short term assistance to those who are in special need and see what can be done.


– With the indulgence of the House, Mr Speaker, might I make one short comment on this matter which I think is very important. If honourable members opposite do not want me to, I will not.


– Is it relevant to the question just asked?


– It is and it is a very important point. The fact is that the means test for these medical services was set in 1968 or 1969. The conditions of the means test needed the agreement of the Australian Medical Association. The AMA at that stage indicated that it was not prepared to allow any easing of the means test and this is why the means test was not eased by the last Government and has not been eased by the present Government. The Government is not in a position to ease it until further discussions take place with the AMA.

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– My question is directed to the Minister for Northern Development and refers to the proposed development of the Port of Darwin. Can the Minister advise the House whether plans are still receiving consideration by his Department, the Department of Transport or any other department concerned? If so, at what stage is the program now? If the program is being delayed can the Minister advise for how long it will be shelved? Is any other plan being considered?


– I can give an assurance to the honourable member for the Northern Territory that this matter is under consideration by the Department of the Northern Territory, the Department of Northern Development and the Department of Transport. I cannot make any firm statement about the timing of the program. I simply say only that this matter is under investigation.

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– I ask the Minister for Foreign Affairs whether his attention has been drawn to the continuing reports of the isolation of the Cambodian capital. Can the Minister advise the House of the situation, particularly with regard to the possibility of a negotiated settlement in Cambodia? Will he also advise the House about the safety of Australian personnel?


– My Department has been in contact at least daily with our mission in Phnom Penh and I personally have been in touch with the Charge d’Affaires. The aid personnel whom Australia has there up country are being evacuated. The dependants of the diplomats in Phnom Penh are being evacuated. The diplomats are remaining at their posts. I do not believe that I can say anything useful at this stage on the prospects of a ceasefire in Cambodia - in the Khmer Republic - such as has already been drawn up in Vietnam and Laos.

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– Has the Prime Minister’s attention been drawn to the official Yugoslav publication Svet of 8th December last which published the story of Ivan Mudrinic relaxing in Belgrade after escaping from the ‘terror and threats in Australia’, to quote the article? In view of the Australian Security Intelligence Organisation’s report on the Warburton dynamite case and the references in it to Mudrinic. will the Prime Minister examine the Croatian documents again and in particular the ASIO theory that Mudrinic was a government agent planted in Australia by UDBA the Yugoslav secret police?


– My attention was directed to this matter by a question on notice, which I cannot at this short notice find. The answer to the honourable member’s question will therefore come in reply to that question on notice.

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– I ask the Minister representing the Minister for Primary Industry whether he is aware of the concern shown by both consumers and producers at rapidly rising meat prices. Does the Minister know that many producers are concerned that exceptionally high prices could cause buyer resist.ence and an increased use of substitute foods? Has he or the Minister he represents had any discussion with industry representatives aimed at preventing spasmodic booms and ensuring a stabilised industry?


– This is a question which has been exercising the minds of many people in Australia who are aware, of course, of the dramatic increase in cattle prices throughout

Australia, and particularly in the export producing areas in northern Australia. This position has been caused primarily by a world shortage of beef, as is instanced by the increasing demand for beef by the United States, Canada, Japan and the member countries of the European Economic Community. It is not an easy problem to solve in the short term because, unlike cash crops, it takes 3 to 4 years to increase beef production substantially. It takes 9 months to breed a calf and then there is the ensuing time it takes to turn it off.

I am aware of the threatened action by some sectors of the Australian community with respect to a possible boycott of butcher shops and also of the statements that there should be a compulsory ban on the export of beef. Let us have a look at these proposals. Firstly, with respect to a boycott, it is my considered opinion, from my knowledge of the industry gained over a fairly long period of years, that this action would not achieve anything significant. What it would do would be to cause unemployment in butcher shops and in local abattoirs. It would mean simply that more cattle would be diverted to the export market in which there is an increasing demand. It would not reduce significantly, if at all, the price of beef in Australia. If there were a compulsory ban on the export of beef through industrial action, this could cause problems in Australia because the cattle producers would hold on to their cattle until they were heavier and older. In the long term, of course, it would cause a reduction in price. The initiative, I believe, has to come from the State governments and the industry itself. The Federal Government has power under the export control provisions to place quantitative restrictions on the export of beef if it thinks such action is necessary in order to reduce the price. This action could cause resentment overseas because it has been shown that, when a country that produces a surplus of food deliberately restricts the export of food to countries which need it, retaliatory action can be taken.

Let me put the record straight. I have had discussions with some leaders of the cattle industry and I have warned them that they had better give some very serious thought to stabilising beef prices in Australia. I know that this is a problem. But the initiative will have to come from the industry, and I believe it will. I know that the Australian Meat Board and the industry are thinking seriously about this problem. It has a significant effect on the consumer price index, which in turn will have an effect on wages. All these factors are leading to inflationary forces in Australia. There is a need for the cattle industry and the State governments to look at this problem seriously and to work out some voluntary restraint, perhaps by introducing a 2-price system based on more stabilised beef prices in Australia and the industry reaping the benefits of the export market. The overall surplus could go into a revolving fund as is done in some other export industries which have stable domestic prices. One thing is certain. If beef prices continue to rise there will be greater and growing resentment among housewives in Australia, and once we start tangling with housewives we politicians had better look out.

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– My question is directed to the Minister for Social Security. Is it now Government policy that jobs offered to registered job seekers must be of the same trade as or equivalent in nature to the work they did previously? Could this result in people who are able to work and for whom work is available being placed on the unemployment benefit at a lower rate of income than that provided by a job which would enable them to make a productive contribution to the community? In view of the Minister’s reply a moment ago to the honourable member for Diamond Valley and his expressed concern for an efficient allocation of resources, does he think that this will improve the living standards of the people concerned and their families and lead to a more efficient use of our human resources?


– The decision to alter the manual of procedures in relation to the unemployment benefit, specifically in the area to which the honourable member referred, was made in response to the right of individuals to dignity and self-respect in their vocational calling. What we tried to do was eliminate the coercion and repression which riddle the whole system of manual procedures. The procedures as changed do not preclude an unemployment beneficiary from taking a job at a lower rating than that which he normally follows, if he wishes to. But what it does do is exclude the right of coercion, of authoritarian direction, in regard, for instance, to requiring a highly skilled worker to take a totally unskilled job. I believe that this step is absolutely necessary.

Up to the present there have been more than 100.000 people unemployed in the community and they are the casualties of the disastrous economic policies of the last Government. They are unemployed not through any fault of their own but because of the incompetence with which economic policy was applied in this community. It is bad enough to have these people lose their self-respect and their sense of dignity by being cast into unemployment without having imposed on them odious practices which create in many people a sense of being demeaned. We have aimed at introducing elements of self-respct within the procedures where unemployment benefit is provided.

There is another thing we have done and which some members of the Opposition have opposed quite vigorously. The honourable member for Mackellar, for instance, when Minister for Social Services, was particularly vocal in his objections to our generous moves to increase unemployment benefit. Until the recent amendments to the Social Services Act. unemployment benefits for a man, a wife and 2 children were $18 a week below the updated poverty line, and they have been below that poverty line for a very, very long time. Thi:, was a national scandal, but the former Minister for Social Services made the objection tha* these benefits were too generous and by implication ought not to have been increased. This belief was put forward on the sole argument - a very questionable on and one which seems to reveal certain biases he has - that it would destroy the moral fibre and the drive for self-improvement of Aborigines. 1 reject these sorts of repressive authoritarian attitudes which- are implicit in so much of what the Opposition did when it was a government.

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– I wish to make a personal explanation.


– -Does the honourable member claim to have been misrepresented?


– I do, Mr Speaker. On 10th April the Minister for Education (Mr Beazley), with whom I share an electoral boundary, purported to explain how I misrepresented him in my remarks at the second reading stage of the Commonwealth Electoral Bill (No. 2) 1973 or. 4th April. In my speech, as is recorded at page 1086 of Hansard, I criticised on 5 grounds his comments about the

12609/73- J? - I53J

Western Australian electoral system. The Minister sought to claim that I misrepresented him on two of those grounds. As recorded at page 1283 of Hansard, after speaking of quota ratios the Minister said:

The upper House seats have multiple members. I did not say there was that distribution in the House. I said it could arise that a person representing an electorate of 80,000 had 8 members representing much fewer. Small country upper House electorates of 9,000 could have 3 members for each seat and in 3 country seats there could be 9 members - 1 said

That is his aside, Mr Speaker, not mine- representing fewer people than a person from one of the large metropolitan seats.

It is not permissible for me to argue the full case now. But there is nothing like that disparity indicated. There are not 3 Legislative Councillors, but two, in each electorate, two and not one in the city electorates as well as the country. Not only is there not this proportion of 9 to 1 existing, but arithmetically there could not be.

The second, and I believe major point, of the misrepresentation occured when the Minister said:

I said that at the last State election in Western Australia the Liberal Party won 29.3 per cent of the vote and the Australian Country Party won 5 per cent of the vote, and with 34.3 per cent of the vote between them they lost the election by only one seat.

He then made an assumption not mentioned in his original speech. He said:

Presumably where there was no Country Party candidate the Country Party voter voted for the Liberal candidate and where there was no Liberal Party candidate the Liberal Party voter voted for the Country Party candidate.

That is not fully or significantly valid in this argument. He went on and referred to-


– Order! The honourable gentleman is now debating the subject.


– No. I am being very careful to avoid doing that. He referred to a statistical index not mentioned in his original speech, which is a theoretical concept of dubious value in supporting the case. But the crux of the matter, from the quotation of his which I have read, is that he used a percentage based on the votes cast only in those electorates contested, and applied that to the whole of the State. He excluded those electorates which for various reasons were uncontested. In the Legislative Assembly the Liberal Party did not contest 14 seats, the Country Party 37 seats-


-Order! I ask the honourable gentleman to deal only with the part in which he has been misrepresented.


– I am explaining the points that the Minister made in a lengthy peronal explanation of 2 or 3 minutes which was permitted to him. I am showing that he left out the most important part of the argument. I end on the note that an important statistic in my argument which he omitted was that in that election the Labor Party obtained 48.99 per cent of the votes and it won the 1970 election by one seat in a House of 51 seats.

Mr Chipp:

– 1 rise to a point of order. At the conclusion of question time when the Prime Minister asked that further questions be placed on notice, my friend the honourable member for Griffith, in his usual courteous way, asked the Prime Minister whether question time could be extended for 5 more minutes in view of the events of this week. The honourable member for Robertson, who was handing something to the Clerk, said in a most arrogant way to members of the Opposition: ‘If you fellows behaved yourselves you might get a few more minutes.’ If that had been said in a spirit of jest we would have accepted it, but it was not. This matter is very important to the Opposition. We deeply resent that mark.


-Order! A point of order should be taken at the time of the event.

page 1378


Bill returned from the Senate without requests.

page 1378


Motion (by Mr Daly) agreed to:

That the House, at its rising, adjourn until Tuesday, 1 May, at 2 o’clock p.m. unless Mr Speaker shall by telegram addressed to each member of the House fix an earlier day of meeting.

page 1378


Motion (by Mr Daly) - by leave - agreed to:

That in accordance with the provisions of the Parliamentary Retiring Allowances Act 1948-1968 the honourable member for Macquarie be appointed a trustee to serve on the Parliamentary Retiring Allowances Trust.

page 1378



Port Adelaide

– by leave- I present the report of the Australian delegation to the 60th Inter-Parliamentary Union Conference held in Rome from 21st September to 29th September 1972. The Conference was attended by 526 members of Parliament, in addition to 184 advisers, Clerks of Parliament and group secretariats. The United Nations Organisation, the International Labour Organisation, the World Health Organisation, the United Nations Educational, Scientific and Cultural Organisation and various other world groups also were represented. It is not my intention during these few remarks to canvas all of the issues which were discussed at the Conference because they are all fully covered in the report itself. However, I commend the report to honourable members and I trust that they will find time to read and study it.

I welcome the opportunity publicly to express my thanks to the other members of the Australian delegation, namely, the leader Mr Jess, Messrs Fitzpatrick and Hallett and Senators Kane, Poyser and Rae for their help and comradeship during the whole period of the Conference. I also report that the delegation played an active role in all of the deliberations of the Conference, both in the committee stages and in the Conference generally. I feel that it is fair to say that on a pro rata delegate basis Australia’s contribution was at least equal to that of any other country represented.

I report to the Parliament that the Conference approved of an application from East Germany for membership of the Union. Every member of the Australian delegation voted in support of this proposal. On behalf of the delegation I express our sincere thanks to the Australian Ambassador in Rome, Mr Malcolm Booker, and to Mrs Booker for the kindness and generosity extended to lis at all times. I also wish warmly to thank the secretary of the delegation, Mr Roy Bullock, O.B.E., and the counsellor, Mr Gordon Miller, for their courtesy, help and co-operation. They both cheerfully performed many duties well outside their particular responsibilities. In fact, they appeared to work, and work extremely well, on the old basis of ‘the difficult things we do immediately, but the impossible takes a little longer’. Finally, to the Parliament and the people of Italy, our host country, I extend on behalf of the whole Australian party our everlasting grateful thanks for their wonderful hospitality and for the efficient manner in which they organised and conducted the conference. I move:

That the House take note of the paper.

Question resolved in the affirmative.

page 1379



- Mr Speaker, a few moments ago it was intimated to me that the Leader of the House (Mr Daly) would not allow debate on this matter to proceed to any length unless I gave him an undertaking to withdraw another motion standing in my name. With the very greatest reluctance, but in view of the importance of the matter now before the House and my desire to push it through to a vote, I now give the Leader of the House the undertaking that today I withdraw the other motion standing in my name.

Mr Daly:

– 1 rise to order, Mr Speaker. The situation is that the honourable member for Mackellar (Mr Wenthworth) has 2 motions standing in his name to be put before the House today. One motion makes allegations against you which no responsible Government could allow to remain on the notice paper. We desire to proceed with both motions today, but it is impossible in the time available to do so. Consequently it was suggested to me by the honourable member’s Leader that he should withdraw the motion relating to you, Mr Speaker, and let this debate proceed. But if the intention of the honourable member is to put the point of view which he has just expressed I ask him to proceed with both motions this morning because the Government intends to deal with them and we will not agree to the withdrawal of the motion against you. Mr Speaker.


– I now proceed with the motion which is before the House standing in my name relating to the abolition of the means test. It is of very great importance. I have said that I will withdraw the other motion standing in my name relating to Mr Speaker, so that is that. I ask leave to withdraw that motion.

Mr Daly:

– Leave is not granted. We could not trust the honourable member for Mackellar in an iron lung.


-Order! If the honourable member for Mackellar wishes to withdraw his notice of motion relating to Mr Speaker, he must submit his withdrawal in writing to the

Clerk. (Mr Wentworth having submitted in writing his withdrawal of notice of motion relating to Mr Speaker)-


– I now proceed with the motion before the House relating to the abolition of the means test, which I believe is of extreme importance. I move:

That, in the opinion of this House, if the means test on social services is not abolished for all persons aged 65 and over by the time of the next Budget, then -

A further substantial relaxation should be provided in the next Budget.

The Government should announce its scheduled program for total abolition with the least possible delay.

Total abolition of this means test should not be made conditional upon or involved with the implementation of other social service proposals of the Government.

As is known, the previous Liberal Government at the last Budget made the decision that the means test for people aged 65 and over should be abolished in the lifetime of the present Parliament. It gave no pledge that it would take the whole of the lifetime of this Parliament to do that and I believe that if we had been returned to power and, most certainly, if I had been Minister for Social Services, the means test would have been abolished in the Budget of 1973. The Australian Labor Party followed that pledge. In the policy speech of the now Prime Minister (Mr Whitlam), an undertaking was given to eliminate the means test in the life of this Parliament. This motion is necessary for 2 reasons. First, there is an immense discrepancy between the policy speech of the Prime Minister and the statement put out recently by the Minister for Social Security (Mr Hayden). On page 12 the Prime Minister’s policy speech states simply this:

The means test will be abolished within the life of the next Parliament.

But the statement put out by the Minister for Social Security on 20th March 1973 read:

Mr Hayden stressed that the committee of inquiry would have to incorporate the Government’s objective of abolishing the means test for those aged 65 and over in the life of the current Parliament.

It is quite obvious that the Labor Party has once more adopted the policy of the Liberal Party. But what has also been made obvious is that the Labor Party put forward false pretences in its policy speech. It said something in its policy speech which it does not intend to do. The pledge - like most Labor pledges, worthless - was that the means test will be abolished within the life of the next

Parliament, not just for people aged over 65, which is, of course, what a Liberal Government would have done. Once again, false pretences.

The second reason why this motion is necessary is a more important reason. There is a suspicion of some fine print in the Government’s policy because it looks as does not really mean to abolish the means test at all. What it means to do is to have some overall policy for guaranteed incomes or some kind of earnings - related superannuation scheme. It will be a very complicated scheme the impact of which will be to water down and make inoperative the simple pledge which the Labor Party made in its policy speech and which - this is important - was fraudulently made.

There are many reasons for the abolition of the means test. I do not intend to go into them at present because I spoke to the Minister before this debate and he gave me permission to have some documents incorporated in Hansard. In accordance with the Minister’s undertaking, I now ask leave of the House to have a document incorporated in Hansard.


– Order! Is leave granted? There being no objection, leave is granted. (The document read as follows) -

page 1380


As a general principle, people should be encouraged to make provision for themselves in their old age, and to avoid reliance upon Government assistance.

Nevertheless, it should be recognised that some old people, through circumstances beyond their control, have been unable to make adequate provision for themselves, and are entitled to Government assistance. Furthermore, it is generally agreed in civilised society that even those whose failure to make this provision has been due to their own improvidence should not be forced to live below a certain standard in their last years.

In Australia, the basic age pension rate makes no distinction between the worthy and the unworthy. The amount of the age pension is from time to time determined at some point substantially above a minimum level - a point which has not been immutably fixed, but has moved upward with changes in national productivity.

It should be recognised that the higher the basic pension, the less is the spur of want in persuading people to make provision for themselves: and it would seem essential that, In order to avoid the conquences which might flow from this, nobody should be discouraged from raising himself above the Australian basic pension level by his own current efforts or his own past thrift.

Thus three principles would apear to be fundamental in the evaluation of Means Test policy -

Current Practices

In Australia we impose a Means Test on age pensions which restricts them to those ‘in need’ and thus reduces our total budget outlay. This raises the inherent difficulty above described - the operation of a Means Test cannot avoid a ‘levelling’ effect, because it reduces the gap between the provident and the Improvident and therefore lessens the incentive to make provision for oneself.

Because it eliminates or reduces the advantages which people obtain from their own effort or thrift, the Means Test is by its very nature a socialistic device, whereas (presupposing that some basic Government pension is given) the universal availability of the age pension would seem to be more compatible with a free enterprise system.

If pensions were included in the taxable income of those people whose incomes were high, and excluded from the taxable incomes of those people whose incomes were low, the revenue would be protected, equity would be maintained, and the principle of free enterprise would be preserved.

The Case Against the Means Test

The arguments against the maintenance of the Means Test on age pensions may be summarised as follows* -

  1. The Means Test is inequitable, lt deprives people of the benefit of their own thrift and efforts. It presses particularly upon annuitants and superannuitants, who are already suffering unfairly from the effects of inflation. It is unfair to those who have suffered war injuries and who, through it, lose their compensation in their old age. It is a disincentive to thrift, selfhelp and self reliance.
  2. The administration of the Means Test involves anomalies. Even today, retired people with incomes of $20 per week lose 50% of their next earnings through the operation of the Means Test alone; and the combined effect of Means Test and income tax so penalises people over quite a substantial range of low or modest incomes that they lose some 70% of any additional income - which is equivalent to the marginal rate of income tax paid on top incomes. Indeed it sometimes happens that old people actually become worse off when their income rises, because they suddenly lose substantial fringe benefits. Anomalies such as this are inherent in a Means Test which has ‘cut-off points’, in contrast to the finely-graduated income tax scale.
  3. The Means Test debars or discourages retired people from taking casual or part-time work. In this way it can be detrimental to their mental and physical well-being; and surely it would be conceded that even the elderly have a ‘right to work’ if they so choose. In addition, loss of their potential output reduces productivity in the Australian economy.
  4. People tend to arrange their affairs so as to escape the Means Test. This discourages thrift among people of working age (who say, ‘Why save, when savings disqualify you for a pension?’), and encourages dis-saving among retired people (who spend their savings on such things as trips overseas or expensive cars in order to qualify for a pension). These practices may sometimes be based on popular misconceptions, but whatever their basis, they are now quite widespread, and weaken the Australian economy.
  5. The nature of the Means Test distorts investment, by inducing people to prefer ‘exempt’ assets, and thus to undertake wasteful expenditure. It also encourages them to take lump sums in place of annuities for their superannuation which, among other undesirable effects, reduces tax yields.
  6. The Means Test is an invitation to cheating, and puts a premium on underhand practices. Widespread acceptance of evasion is almost a way of life’ in this field and must have repercussions in other fields.
  7. The Means Test humiliates old people, because the clerks who administer it must of necessity pry into their private affairs. It makes age pensions a charity, and is ‘odious’.
  8. The Means Test impedes socially desirable transfers of property from parents to children, and penalises past transfers in a way which is sometimes inequitable. This is especially important in the case of some primary producers.
  9. The application of the Means Test has become complex, especially after the 1971 amendments to the pensions system. Rates in such matters as boarders, casual earnings, and past gifts are inherently complicated. Confusion causes resentments.
  10. The existence of a Means Test on the basic age pension makes it difficult to formulate a satisfactory scheme of national superannuation.

Of the above ten arguments against the Means Test, the third has great weight. Sudden and enforced idleness at the age of 65 can be very harmful to a man, and lack of purpose is pathetically evident among many of the elderly, who still have their faculties and could be continuing to produce on a limited scale for their own benefit and for the benefit of the community.

Great weight may also have to be accorded to the tenth and last argument. The existence of the present Means Testis an effective bar to the adoption of any sensible scheme of National Superannuation.


– First, let me go into the history of this matter. The abolition of the means test is fundamentally in line with Liberal Party philosophy and fundamentally opposed to Australian Labor Party philosophy. This policy was stated in the Liberal constitution as it was when I first came into this Parliament, But because of the need to move towards this gradually we instead undertook a plan of gradual, progressive liberalisation aimed at eventual abolition. That plan culminated in the announcement regarding abolition made in the Budget of 1972 by the then Treasurer. This was what was done by the Liberal Party and it was fundamentally in line with the policy of the party. The means test is a socialistic device and its abolition is therefore fundamentally out of line with Labor philosophy.

In 1954, Dr Evatt who then led the Labor Party at an election made a pledge on this matter without consulting the ALP authorities, for vote getting purposes. Members of the Labor Party then and subsequently in the House pointed out that this was out of line with Labor policy. Indeed, it was the bitterness that arose from this that, on Dr Evatt’s own statement of 1955, was one of the prime causes for the attitude he adopted which led to the formation of the Democratic Labor Party. However, the Australian Labor Party platform does in point of fact call for the abolition of the means test within the life not of one but of two Parliaments, as well as the use of a national superannuation scheme in order to cover the whole thing up. This is what I suspect is happening.

In the statements which were made by the present Minister for Social Security - he has put out a voluminous packet of statements over the last couple of years - he talked about the abolition of the means test being undertaken over 6 years or 2 Parliaments. That of course is in line with Labor policy. But the Prime Minister in his election speech again went against his Party’s policy and said: We will do it in one Parliament’. He was trying to match what the Liberal Party had done and was saying: ‘Anything you can do, we can do better’. That seems to be his motto. But I do not want to underestimate this; I should like to put it much more seriously. This action of the Prime Minister which went against fundamental Labor Party policy and which violated the written platform of his Party was taken quite cynically for vote catching purposes and it was effective. The fraud worked. The voters were taken in by it. I suppose the Prime Minister would say as a king of France said once, earlier, when he had to swallow his beliefs: ‘Paris is worth a Mass’. The Labor Party is now seated on that side of the House and I suppose that its members feel that their fraud has paid off. The important thing is that once again, there is a suspicion of bad faith in the Labor Party.

As to the form of the motion before the House, there are 3 points that I would make. Originally, I had a simple motion to do what a Liberal government would have done, namely, to get rid of the entire means test to those over 65 years of age at the next Budget. Because of the way in which the Labor Party has gone on feeding the fires of inflation and the financial situation which it itself is creating, which is quite different from the proper ordered development which would have gone on had we been returned to office, it may be felt that this is not practicable immediately. The total cost would be somewhere in the bracket of $200m to $250m a year, but the net cost, if the Government, as it should, made it taxable for those with high incomes, would be very much less than that. However, two things must be said. First, the present Government’s policy has caused an inflation which could not have been foreseen. Nobody thought that the Government would be quite as stupid as it has been, although I do not believe that the Budget measures themselves or the financial measures taken in the House are the prime cause of the inflation. The prime cause lies, unfortunately, outside this House and in things that the Government is doing outside this House. I do not believe that the prime cause of what is happening is the financial measures taken in this House. Although the means test abolition would be counter inflationary over the long run, in the short run it may add a little, perhaps not a significant amount, to an inflationary situation which is at present coming into existence.

If it is not all to be done in the next Budget, as I am sure the Liberal Government would have done, let there be at least a substantial and positive instalment. We have a right to demand that now and we have a right to demand that the Labor Government should unveil some of its shadowy plans and let us have some kind of a schedule for what it is doing and what it is pledged to do in the next 3 years. The Government should give us some kind of explanation of the substantial difference between the policy speech of the Prime Minister (Mr Whitlam) and the statement of 20th March by the Minister for Social Security (Mr Hayden). However, that is not the main point. The real point of this motion being in this form - why it has been strengthened and put in this form - is that I believe the Gov ernment is plotting another kind of swindle, another kind of fraud, lt will not really abolish the means test. It will say that it will abolish the means test but it will involve this in some kind of new deal, which is dependent upon what will not be called taxation - it may be called a contribution - but what will, in effect, still be taxation. If one reads the voluminous and sometimes mutually contradictory memoranda which the Minister for Social Security put out while he was still a member of the Opposition, people will see what I mean and know what I fear.

The position is this: I frankly do not trust the Treasury advice which the Government is receiving. In the last Government the Treasury fought tooth and nail against the abolition of the means test. The responsible officers of the Treasury told the head of what was then my Department that abolition would take place over their dead bodies. That was the Treasury’s view. To the credit of the previous Government it over-rode the Treasury. Cabinet had sufficient strength to stand up and make this decision in the teeth of Treasury advice. It was a good decision and a right decision. Treasury officials were guilty of a good deal of special pleading and duplicity in the material they brought forward. I will not, of course, speak on what they put to Cabinet because it would be wrong for me to do so, but I know what they put to people outside of Cabinet. In this matter the Treasury cannot be trusted. It will be inciting the Government to perpetuate this kind of swindle. I believe that the Minister for Social Security, from his own previous memoranda, will be only too ready and eager to accept Treasury advice in this matter. I would be more confident, of course, in this matter if the Department of Social Security, which used to be my Department, were still under the control of Mr L. B. Hamilton, the former Director-General and one of the most competent officers in the Public Service. He has been succeeded in that position. I know the circumstances of this but I am not prepared to talk about them. He has been succeeded by Dr Wienholt and I am not trying in any way to denegrate Dr Wienholt or write him down but I simply say his ability is not nearly as great as that of Mr Hamilton, the man who has left. This is not meant as a criticism or denegration of Dr Wienholt but as a commendation of Mr Hamilton. Since we have the Minister’s new appointment as head of the Department of Social Security and since honourable members know of the Minister’s own ambitions I would feel that perhaps the Weight of Treasury advice - if I can put the Word advice in inverted commas - would be such as to induce the Government not to do the clean thing, not to get rid of the means test but to involve the abolition of the means test, in some other kind of financial shenanigans.

It is necessary to separate this question of the abolition of the means test, for which the Prime Minister in his policy speech gave a clear and unequivocal pledge, which I believe he is not going to keep, from the question of national superannuation. I believe and assert that it is important for us to have a scheme of national superannuation. I hope that I shall have an opportunity of bringing a private member’s Bill for this purpose before this Parliament in due course but I do not believe that national superannuation should be involved with this simple question of justice - the abolition of the means test. Let this be done cleanly, let h be done altogether in the next Budget, or, if not entirely in the next Budget, substantially in the next Budget, and let a pledge and a clear program be indicated for carrying out the rest of the program.


-Order! Is the motion seconded?


– I second the motion. First, I think we should remind ourselves what the motion provides. In part it states:

  1. . if the means test on social services is not abolished for all persons aged 65 and over by the time of the next Budget, then -

    1. a further substantial relaxation should be provided in the next Budget.
    2. The Government should announce its scheduled program for total abolition with the least possible delay.
    3. Total abolition of this means test should not be made conditional upon or involved with the implementation of other social service proposals of the Government.

I entirely support the motion moved by the honourable member for Mackellar (Mr Wentworth) who. as the Minister for Social Services in the previous Government and. indeed, long before he became so, has shown an intelligent and sensitive regard for the problems of old people. I am indeed honoured to support him. It is most important that something should be done promptly. All of us grow older, but the expectation of rife of old people is much less than that of others and what is not done today, tomorrow ©r the day after may have no significance to them. For this reason it is most important that something substantial should be done at least in the next Budget.

I believe that the promise that was made by the Prime Minister (Mr Whitlam) should not be delayed by reason of complicated proposals for national superannuation schemes or for a scheme of guaranteed minimum incomes as announced by the Government. The preparation of such plans will take a long time. The administration will be complicated. By this time, as Keynes once remarked, in the long run we are all dead. It is certainly true of many of those people who hope to have some improvement in their situation as old people.

I believe that we first need a flat rate pension with inducements for people to save beyond the limit that should be available to all at the age of 65 years and it should be adjusted to take account of inflation. It should be a reasonable proportion of average earnings in order to keep pace to some extent with the growing prosperity of the community. I believe that these are the ingredients of a satisfactory scheme. What are the questions to be asked? Is it desirable that the means test should be abolished? If so, is it practicable to do so within a limited time? Would it be just to both the rich and the poor, because all would become beneficiaries on the abolition of the means test? I do not propose to go into any detail about whether it is desirable. On many occasions the honourable member for Mackellar has stated the reasons. I will say simply that as it now stands the means test is inequitable because it deprives people of the benefit of their own thrift and efforts. It discourages people from saving and taking casual and part-time work, even when a tapered means test is in operation. It is humiliating and invites cheating. It dictates an undesirable pattern in the preferred expenditure of old people; for example, on expensive homes, cars, trips abroad and things of that kind. I propose to say no more about the means test because these points have been covered on many occasions.

The next point is whether substantial immediate relief is practicable. I do not propose to spend time on this point. The honourable member for Mackellar was Minister for Social Services and has taken a tremendous interest in social welfare over a long time. I remember him first as financial adviser to the New South Wales Treasury. I think all honourable members are aware of his abilities.

I am prepared to accept what he has said after careful study, that it is a practical move. I do not propose to spend any more time in dealing with that part of the matter.

Would it be just to the rich as well as to the poor, or to the poor as well as to the rich if the means test were abolished? It is proposed by the honourable member for Mackellar that any additional income paid to people by reason of the availability of the pension, whether rich or poor, would be subject to the progressive income tax rates so that the rich would not gain very much. I want to make some general observations and then to deal in more detail with the question of inflation in relation to the provision that old people may wish to make for their retirement. I will take about 2 minutes to make some general observations. It was inflation in Germany that brought Hitler to power. This had quite an important impact on the world.

Within the last 6 months the London ‘Economist’ has pointed out that if inflation continues at the present rate in England, £1 will be worth a penny within the span of an ordinary person’s working life. The same very sober journal believes that if this situation continues Britain will finish with a political system similar to that of a South American republic. They are expressions of opinion of a very sober and responsible journal. We are treading precisely the same path. The inflation of recent years is now accelerating and we could finish up facing the situation that Britain faces today. I shall be dealing with this aspect in relation to the provision of people for their old age. Taking the Australian situation, the calculation of the Research Service of the Parliamentary Library is that the Australian dollar, if prices continue to change at the present rate of 6.8 per cent per annum, will be in 40 years time the equivalent of 7 cents in value. The Australian dollar will fall to a value of 7 cents within an ordinary working lifetime, on the assumption that the rate of inflation does not increase beyond the present annual rate of 6.8 per cent. I believe that it will increase and that we will face the situation that applies in Britain today.

What is the bearing of this factor upon the attempts of people to save for their retirement? Does inflation affect retired people who tried to make provision for their old age in retirement? As to the rich, we need not worry very much about them. They have their own way.

Professor Samuelson, a very distinguished visitor to these shores a short time ago, said in a television interview that the rich look after themselves by buying real property, equities and such non-inflatable assets as paintings, jewellery and so forth, and by going into debt. I shall explain that in a moment. The rich also engage in deals of various kinds. We have seen a lot of this in the field of company shares in recent times.

One hedge against inflataion is the purchase of real property. Most people gain tremendously on the purchase of their homes. I have here a table prepared by the Research Service of the Parliamentary Library and I ask for leave to have it incorporated in Hansard.


– Is leave granted? There being no objection, leave is granted. (The document read as follows) -

page 1384


If a person takes out a housing loan of $20,000 for 30 years at 7% p.a.

Answers -

  1. Weekly repayments will be $30.68.
  2. Latest A.W.E. is $104.00 and therefore weekly repayment is 29.5% of this figure.
  3. The average increase in A.W.E. over the last 3 years has been almost 10%.

Applying a compounded 10% to $30.68 for 30 years gives a figure of $1,815 per week for Average Weekly Earnings and the weekly repayment is 1.7% of this figure.


– The calculation shows that the original repayments on a loan for purchase of a home may cost a man 29.5 per cent of his average weekly income. At the end of 30 years the repayments are 1.7 per cent of his average weekly earnings, assuming continuation of the present rate of acceleration. The table explains in detail why it is a very good proposition to buy a home. Of course, it has to be remembered that while it is good for most people who buy a home it is bad for those people who rent homes so that any surplus money they may try to invest, for example, in permanent building societies, suffers erosion just as people gain from that erosion in the purchase of their homes.

The other hedge to which Professor Samuelson referred is investment in equities.

This may be done by individuals trying to save for their retirement through assurance societies that may invest in equities, or superannuation funds which may make the same type of investment. I have before me another table prepared by the Research Service of the Parliamentary Library showing what happens in the case of investment half in shares and half in debentures, in terms of capital value and, income first in 1962 and then in 1?72; that fi over a 10-year period. I ask leave of the House to incorporate the table in Hansard.


– Is leave granted? There being no objection, leave is granted. (The document read as follows) -


– The table shows that with this kind of investment the total value of the selected shares would be $44,004 in 1962; in 1972 it would be $68,710, an increase of 56 per cent. The total dividends and income derived from the shares and debentures in 1962 is $2,485. In 1972 it is $3,178. This indicates that market values have more than kept pace with inflation, but income has not kept pace with inflation. We can measure inflation in terms of various measures such as the consumer price index. In terms of the consumer price index, the income would diminish and the capital value would to some extent increase, but on one has to remember that bad investments may be made and that the market fluctuates. I believe that as time goes on there will be fewer and fewer shares available for purchase in the market, and if the Treasurer (Mr Crean) introduces a policy of low interest rates, obviously the demand for shares will be greater, the cost of them will be greater and the return on them will be greater. If the Australian Industry Development Corporation proceeds to buy into new shares there will be still fewer available on the market, and the public will have to contribute to the AIDC by way of fixed interest bearing securities and will not benefit from any improvement in yield from the investments of that Corporation.

Assurance societies offer another means whereby people try to make provision for their retirement. I have taken a mix of their investments as at the present time and as appearing in published documents. This is an average sort of mix of their investments. Government securities 42 per cent, local government 16 per cent, debentures IS per cent, and ordinary shares 27 per cent. That makes up the 100 per cent of their investments. Taking the first table that I have mentioned again as the basis it may be found that the capital value of their assets would have increased by 30.9 per cent over the period 1962 to 1972. That is below the increase of 36 per cent in the consumer price index over the same period. The increase in income would have been 22.6 per cent, again well below the 36 per cent increase in the consumer price index. Mr Speaker, from these things you will see the difficulties of anybody trying to hedge against inflation and for this reason - I have taken some time to reach this point - I believe that the abolition of the means test should be regarded as some measure of compensation to those who suffer from inflation from those who gain from it. Inflation is a kind of Robin Hood in reverse. It takes from the poor and gives to the rich. I see the abolition of the means test as some kind of compensation from those who gain from inflation to those who suffer from it. I am thinking particularly of people who are trying to make some provision for their retirement in old age. .

Minister for Social Security · Oxley · ALP

– The honourable member for Bradfield (Mr Turner) approached this issue in a temperate, informed and concerned way. Although the Government will not support the motion for reasons which. I shall mention shortly, I find little of what he said that I would disagree with, if indeed anything. In fact it was this concern which he stressed, and very correctly so, about inflation eroding the living standard of people dependent on fixed incomes in retirement that led the Government,, when in Opposition, to undertake 2 things - to abolish the means test and give a guarantee to people in retirement that they would at least have this flat rate benefit available to them; but secondly and much more importantly we undertook that we would inflation-proof the benefit rate provided and that we would inflation-proof it in a really meaningful way, a way which would allow those in retirement drawing on this benefit to maintain, insofar as the benefit is concerned at least, a spending capacity relative to average standards of spending available to people in the community.

We sought to do this by developing mechanism whereby the benefit rate on retire ment, the age pension, will become 25 per cent of average weekly earnings. There will be progressive increases in the benefit rate twice annually, of $1.50 on each occasion until ultimately 25 per cent of average weekly earnings is achieved. It could be that if the movement in average weekly earnings were to continue at the rate developed under the previous Government $1.50 a week would not be enough.

Mr Wilson:

– Will you make it $2? 1


-We are keeping the situation under observation. If we find it necessary to increase those rates of increase this will be done. We accept this as a responsibility. Let us have none of this artificially contrived outrage of members of the Opposition such as the honourable member for Sturt, who just interjected, that $1.50 a week will not be enough to reach this objective. I have indicated what steps we will take to make sure that it does reach this objective. Even without that, the rate of benefit that will be provided according to these adjustments would be much greater at any given time than the rate of benefit which the present Opposition proposed in its policy speech at the last election would be provided through the adjustment mechanism that it was to introduce. Under its adjustment mechanism the increase in benefits would move according to consumer price index movements, and they are considerably lower than average weekly earning movements.

Let me point out an illustration. Between 1961-62 and 1971-72 the consumer price index movement was only 36 per cent compared with an average weekly earnings index movement of 96 per cent. Let us put that in money terms for that period. An amount of $20 at the commencement of that period increased by the consumer price index movement becomes $27.28; but $20 at the commencement of that period increased by the average weekly earnings index movement becomes more than $39. Quite clearly the beneficiary or the people drawing age pensions under our proposals would be considerably better off under the mechanism we aim at achieving than under the one that the last Government was putting forward - and putting forward in a belated and rather uninspired way in the closing stages of the election campaign.

But it is about the contribution of the honourable member for Mackellar (Mr Wentworth) that I want to speak. First of all I want to make it clear that I will not enter into any debate about the relative merits of the former Director-General of the Department of Social Services as it then was, Mr Hamilton, and the present Director-General of the Department of Social Security as it is now called, Dr Wienholt, except to say that the reputation of Mr Hamilton is extremely high with all those people who worked with him, and it is unfortunate that through ill health he found it necessary to retire. I accept this high reputation that he enjoyed. It is so widespread that it must have been justified. But then, too Dr Wienholt similarly enjoys a very high reputation. I have worked with Dr Wienholt, the new Director-General of the Department, and I know from experience - I do not have to rely on reputation - that his reputation is well and truly justified. He is pre-eminent in the capacities necessary to administer this important Department. But I would say one thing. The honourable member for Mackellar stressed the outstanding qualities of excellence needed by a Director-General of the Department of Social Security and he referred to Mr Hamilton. I watched the performance, qualities and the capacity of the honourable member for Mackellar as Minister for Social Services during the past 5 years in this House and all I can say is that I can well understand why he would find a very pressing need to have a man of outstanding qualities of excellence to make sure that the Department ran under him.

It is the honourable member for Mackellar I wanted to speak about. There was a typical display from him, a wordy old windmill flailing and floundering in a gust of self-imposed verbosity. Can he be taken seriously any longer? This is the man who up till 5 years ago, as a spokesman in this Parliament on the back benches on the Government side, continually argued that the means test should be abolished in 3 years. There was no practical reason why this should not be achieved, and yet at the conclusion of 5 years with the honourable member as Minister for Social Services the means test still applied. There were some minor adjustments. There was a tapering of the means test - an important contribution, I concede, but a very mild one in terms of the elimination of the means test. It was not really an elimination of the means test or even a major step towards it by any stretch of the imagination. It could have become a permanent feature of a permanent means test. Again there was an effort to capitalise superannuation rights but this could be regarded in a similar way. The fact is that at the end of 5 years, let alone at the end of 3 years as he promised, the means test was still there.

The way in which the honourable member for Mackellar approached the issue in this Parliament today is rather peculiar. No longer the Minister for Social Services, he is propounding now the abolition of the means test once again. He has changed his position slightly. His is a big act of continuing apostasy as far as the public is concerned. We formed fair and accurate judgments of the man’s performance in this House over a very long term. He is a man who made his reputation by promising the abolition of the means test but who, when given a golden opportunity to do so, failed to achieve his promise. He knows full well that this Government will do it - there is no equivocation there - in this Parliament. The means test will be abolished to enable all people of 65 years and over to draw an age pension. We have a program presently being costed and analysed and when we consider it is appropriate we will announce the details of it and not because the honourable member for Mackellar is demanding, now that he is no longer the Minister for Social Services, that we should tell him how we will achieve what he could not. This is an act of apostasy. It is his whole approach to this issue. A few weeks ago in the Parliament he moved: That in the opinion of this House the abolition of the means test on social services for all persons aged 65 years and over should not be delayed beyond the 1973 Budget.

Last night the moment of insight arrived and he changed his mind. He said that there should be first a substantial relaxation of the means test in the next Budget and that the Government should announce its scheduled program for total abolition with the least possible delay. The Government agrees with that and will do those things if they slot into the program it has in mind, but it will do those things according to the timing it set and not the timing that the honourable member for Mackellar sets. After all he was totally unsuccessful in setting any timing at all when Minister for Social Services for 5 years. I think he has a little more than a good modicum of gall in suggesting that this Government should do now the things he could not achieve. But why has he changed in the last couple of weeks from stating in his grand style and with the grand romantic sweep he likes to use from time to time that the means test should be abolished in the next Budget to last night at the moment of insight saying that it might take a little longer? The gossip in the corridors is that he was imposed upon by senior members of his Party and told that this is now embarrassing for the former Government because it, after all, gave no promises. He tried to intimate as much in the closing stages of the election campaign, sensing with that peculiar sense of selfpreservation which he has that the then Government was on the way out. The honourable member for Mackellar had the biggest swing against him of any Liberal member in Australia at the last elections. Had his seat not been such a safe blue ribbon Liberal seat he would not be here today, such is the reputation he has in his electorate.

The previous Government never suggested that it would abolish the means test immediately. It consistently said, as we have been saying, that it would be done in the next 3 years. We say in the next Parliament but it is tantamount to the same thing. What was his record when he was Minister for Social Services? He said that the Treasury had been responsible for quite unacceptable behaviour, virtually operating a fifth column in his Party to undermine the sorts of objectives which he was setting about achieving and which he hoped Cabinet would support. A fifth column! He was accusing the most important government department - the most crucial role in the Public Service is that of the Treasury - of being a fifth column, people dedicated to undermining the Government and to destroying its policies. I might add that the honourable member for Mackellar was then talking about the Government of the past. 1 challenge senior members of the Opposition parties to dissociate themselves from those statements. There can be no doubt that there was a lot of bitterness in the ranks of the previous Government over this issue. Let me quote some newspaper articles from the June period last year. The Adelaide Advertiser’ carried the following story:

On Sunday Mr Snedden said in Melbourne that this would cost the Government $440m a year- that is, the abolition of the means test - assuming the present pension rate continued.

The report goes on:

They had been rejected because the Government believed raising the necessary $440m each year would amount to a substantial redistribution of income from the working population to people with income or property large enough to exclude them from full or part age pensions.

That is what the then Treasurer said. The honourable member for Mackellar, then the Minister for Social Services, came out with a vindictive public attack on the then Treasurer. The ‘Australian’ newspaper of about that period - my copy of an article from it is undated - said of the Minister for Social Services:

He issued a blunt statement in Canberra virtually accusing Mr Snedden of having used misleading figures in a speech on Sunday to overstate the cost of abolition . . .

This was seen as repudiation of Mr Snedden’s remark that for a government to raise the sort of money needed to provide pensions for everybody, regardless of need, would amount to a ‘substantial redistribution’ of income from working people to those with considerable income or property.

How can honourable members opposite have any faith in or rely on statements by men like this who cannot even agree on what the true situation is; where there is such vindictiveness and distrust between senior members of the last Government? That sense of intolerence in the ranks of that Party as a Government exists today within the same Party as the Opposition.

Let me conclude by stating what the Government intends to do as distinct from the misrepresentations put forward with some sense of bitterness by the honourable member for Mackellar, the former Minister for Social Services. We intend to abolish the means test within the term of this Parliament for people 65 years and over. We aim at introducing a system of national superannuation. The honourable member for Mackellar made such a promise but never fulfilled it. The 2 things which we hope to mesh but not mate are the abolition of the means test and the introduction of national superannuation, upon which the former is dependent. Common sense indicates that the 2 things should mesh together. In view of the Misrepresentation of the Government’s position in relation to debate procedures made by the honourable member for Mackellar, I move:

That the question be now put

Question put. The House divided. (Mr Speaker- Hon. J. F. Cope)

AYES: 61

NOES: 49




Question so resolved in the affirmative.

Question put:

That the motion (Mr Wentworth’s) be agreed to.

The House divided. (Mr Speaker- Hon. J. F. Cope)

AYES: 49

NOES: 61

Majority .. ..12



Question so resolved in the negative.

Mr DEPUTY SPEAKER (Mr Scholes)Order! I call on General Business - Notice

page 1389

No. 2

Suspension of Standing Orders


– I move:

That so much of the Standing Orders be suspended as would prevent the immediate reopening of the debate upon Notice No. 1, General Business, on today’s Notice Paper.

I find it very hard to understand why the Government should seek to curtail debate on a subject on which it claims to have the interest of the less fortunate members of the community at heart. It is very hard to understand, unless, of course, the Government has acted in a sense of pique. The Government has accused the honourable member for Mackellar (Mr Wentworth) of being inconsistent or of trying to do something that he did not want to do when he was the Minister responsible for social services. The honourable member for Mackellar has shown much more dedication and concern for the less fortunate members of the community and has done much more to alleviate their distress than any other member of the House. In moving his motion today the honourable member is consistent with the attitude that he has adopted since he has been a member of this House, both as a private member and as the Minister responsible for social services.

Again I find it hard to understand why the Government has sought to curtail debate when its supporters were very loud in their complaints about the number of times the previous Government used the gag and the guillotine. The present Government has shown itself to be much more ruthless in the few weeks that it has been in office than our Government ever was. I hope that the Government will be able to offer a very satisfactory explanation to the people that the honourable member for Mackellar seeks to help. After all, the honourable member thought, and I thought, that he was expressing the view of all parties .in this House, the view that the means test should be abolished as quickly as possible.. The stated intention of the 3 parties in this place at the last election was that they would abolish the means test within the life of this Parliament.

Mr Hayden:

– On a point of order: This seems scarcely relevant to the discussion of the suspension of Standing Orders which I understand the honourable member is proposing. In fact he is canvassing the earlier debate.


– He is telling you why he wants to suspend them.

Mr Hayden:

– He is not debating the motion.


-Order! Honourable members will address their remarks to the Chair. I do not need the assistance of honourable members in regard to the point of order.

Mr Hayden:

– What the honourable member is doing is canvassing the previous debate. He is not giving the reasons why Standing Orders ought to be suspended to allow debate to continue. That, to me, would seem to require an explanation of some technical or mechanical matters for its justification,


-Order! I, think the Minister has put his point of order. There is no valid point of order. The honourable member for Henty is explaining the reasons why be believes the debate should be reopened and I think that the previous debate is relevant to that question.


– Thank you, Mr Deputy Speaker. My remarks as to why the Government has seen fit to curtail debate on this subject are relevant. I protest about the action that the Government has taken on this occasion. It is showing itself to be utterly ruthless on this subject and I believe it will find its actions very hard to explain to the people that it claims to represent. I cannot understand why the Government moved a motion to gag the debate, trying to reduce to a minimum debate on a subject which should be of interest to every member of this Parliament and on which, as I have said, the 3 parties represented here have a common policy. The Labor Party stated, as did the Liberal Party and the Australian Country Party on their own behalf, that one of its objectives was to eliminate the means test within the life of this Parliament. That is not inconsistent with what the honourable member for Mackellar has said. He certainly wants to see the means test abolished within the life of this Parliament, but he wants to see it done sooner rather than later. For that reason I believe that the Opposition ought to be permitted to continue this debate. A number of honourable members on this side of the House - I am sure there are some on the other side - have a point of view to present on this matter. It is a scheme which, as the honourable member for Mackellar says, should not cost a very great deal of money to implement and it would correct an injustice. At the present time the Government is trying to stand up for a penalty on thrift. It is saying to people: ‘If you save your money and make provision for yourself-

Mr DEPUTY SPEAKER (Mr Scholes)Order! The honourable gentleman is now debating the question and not the motion.


– Yes, I am getting a little wide of the motion. I thank you for the tolerance you have shown, Mr Deputy Speaker. But I want to make a very strong protest on behalf of honourable members on this side of the House who have given a very great deal of thought to the subject and who would like the opportunity of expressing themselves.

Mr Keogh:

– Tell us why you failed to do it when you were in office.


– Our friend opposite is trying to debate the question. He will provoke me into replying, and that will incur your displeasure, Mr Deputy Speaker. I do not want to do that. I have already explained that the honourable member who moved the motion which appears on the notice paper under general business was not the least bit inconsistent. Throughout his time in this House he has always advocated what is contained in this motion. I do not think it is right that he should not be given the opportunity of expressing himself and that his colleagues who think likewise should not be allowed to debate this matter and put it to a vote. We on this side of the House would very much like to know where the Government stands on this issue and whether it is in agreement with the motion moved by the honourable member for Mackellar. I am quite sure that the people whom honourable members opposite claim to represent would like the matter to go to a vote to see which way the Government votes. For that reason I have moved the motion to suspend Standing Orders.


– Is the motion seconded?


– I second the motion. In doing so I want to draw to the attention of the House the original motion which this motion seeks to have further debated. The motion moved by the honourable member for Mackellar was:

That, in the opinion of this House, if the means test on social services is not abolished for all persons aged 65 and over by the time of the next Budget then:

A further substantial relaxation should be provided in the next Budget.

The Government should announce its scheduled program for total abolition with the least possible delay.

Total abolition of this means test should not be made conditional upon or involved with the implementation of other social service proposals of the Government.

Honourable members came to this House this morning expecting to have the opportunity in general business time to canvass this topic in detail. The motion deals with a number of aspects relating to the abolition of the means test. Many of us wanted to express our concern on the various aspects of this motion. In voting on it prematurely, as was done a few moments ago, the Government indicated its opposition to the abolition of the means test and to the separation of the question of means test abolition from the question of the establishment of a national superannuation fund. These were aspects which we wished to canvass in detail, because there is rising disquiet in the public mind as to whether the means test will be abolished or whether it will be replaced by the new fancy and favoured needs lest, being a means test under the guise of a new and popular name. In addition there is rising concern amongst those who wish to see a viable national superannuation scheme over to the meagre proposals enunciated in the Government’s policy and platform.


– I suggest that the honourable member is now canvassing the question and not the motion before the Chair.


– These are aspects of the matter which honourable members on this side of the House wish to have an opportunity to discuss. This is a matter of great significance. The public at large - both the pensioner and the non pensioner retiree - want the questions of means test abolition and national superannuation schemes dealt with in an atmosphere of objectivity and discussed in detail so that we can achieve the best possible national retirement scheme. Here today the debate was cut short. Now honourable members on this side of the House want to have the question reopened so that the public can be made aware of the attitudes of honourable members on the Government side and members of the Opposition and so that we can have an opportunity to express in detail our concern at the various alternatives open in the achievement, firstly, of means test abolition and, secondly, of the introduction of a viable national superannuation scheme. The Government used its numbers to gag this debate. It has aroused in the minds of the public - both the retirees and all those who are taxpayers - grave concern as to whether or not the debate is being gagged so that the Government can devise a scheme whereby, under the camouflage of the total contribution, it will impose heavy and burdensome taxation-

Mr Martin:

– I take a point of order, Mr Deputy Speaker. I ask for your guidance on this. Is it in order for the honourable member and the Opposition to try to talk out the time?

Mr DEPUTY SPEAKER (Mr Scholes)Order! There is no substance in the point of order. I think the honourable member knows that.


– I was concluding on the point that the public wants us to debate the question as to whether, by the imposition of a contribution, what will in fact be the heavy burden of taxation will be imposed upon the middle and lower income earners and, in particular, upon families. These are the sorts of questions that we wish to debate. That is why I second the motion.

Leader of the House · Grayndler · ALP

– Never have I heard a more phoney or hypocritical motion moved in this Parliament. I ask honourable members to look at the notice paper for today. It contains 2 motions by the honourable member for Mackellar (Mr Wentworth), both of them important and both of them deserving of the attention of this House. Consequently, the Government desired to allow debate on both of these motions in the time permitted for general business. But the honourable member for Mackellar, in his usual fashion, endeavoured to sidetrack the Parliament by making sure that there were 2 motions there and, in that way, to complicate the position. The Government, not desiring to have Mr Speaker waiting on a decision on the second motion - that Mr Speaker ought to be ashamed of himself - and not seeking to stop discussion on the other motion, saw no way out other than to divide the time available this morning between those 2 motions.

I was approached by the Deputy Leader of the Opposition (Mr Lynch) who suggested to me that, if the motion that the honourable member for Mackellar had submitted in regard to Mr Speaker being ashamed of himself was withdrawn, debate on the other matter could probably proceed until 12.45 p.m. I reluctantly and sorrowfully say that, against my better judgment, I accepted the word of the Deputy Leader of the Opposition that the honourable member for Mackellar would keep his word. What has happened is precisely what I thought would happen. First of all the honourable member put in a withdrawal motion of the second motion and has now withdrawn the withdrawal. I should have known that the honourable member would move his motion, take up the full time of the morning, withdraw the withdrawal again and put it on the notice paper. I am not doing him an injustice, but that is rotten and contemptible conduct.

Mr Wentworth:

– I demand that the Leader of the House withdraw something that is patently untrue and offensive to me.


– I ask the Leader of the House to withdraw those remarks.


– I withdraw the remarks but the facts are indisputable. I was asked this morning to let the honourable member go to that length. Then when the matter came before the Parliament - I am sorry I cannot use certain words - the honourable member stood up and said that the Government had blackmailed him into calling off his motion. That was a most dishonest approach. That is something that no selfrespecting leader of this House could tolerate. I formally advise the Deputy Leader of the Opposition that never again will 1 take his word for any arrangements made with the honourable member for Mackellar. The real reason behind what has occurred is that the Opposition did not want me to expose the falsity of what the honourable member for Mackellar was going to put up. It did not want me to lay open the charge and the fact that he had no support on either side of the chamber for his motion except for himself and probably one or two others. The action was subterfuge in order to destroy arrangements which the Government had entered into in the interests of this Parliament. The honourable member for Mackellar has now deviously withdrawn his withdrawal because he wants the Speaker to be under a cloud because of a subterfuge which does very little credit to the honourable member. If that is how he treats the high office that the Speaker occupies in this Parliament, thank God for this country that he is sitting on the Opposition side of the House.

I would just say to honourable members opposite that the Government has no desire to avoid debate on the abolition of the means test. We have been in government for only 3 or 4 months and already the means test has become well on the way to being abolished, despite the fact that the former Minister, the honourable member for Mackellar, and the Government he supported had been in office for about 23 years and had done nothing about it. I rise in this debate only to show up the falsity of the charges of honourable members opposite. The Deputy Leader of the Opposition knows full well that what I say is correct. Is he to be a party to allowing the honourable member for Mackellar to restore the motion against the Speaker to the business paper? The honourable member for Mackellar was called on to remove it this morning but instead put up one of his offsiders to move a motion to delay the time of the House so that the motion against the Speaker would not be moved today. The real purpose behind this motion is to stop the honourable member for Mackellar from moving the motion against the Speaker for which he knows he has no support on either side of this Parliament.

Mr Martin:

– To get him oS the hook.


– It is to get him off the hook. To prove that I am right, I state that the honourable member for Mackellar has withdrawn his withdrawal. I invite the honourable member to debate the motion forthwith if he sees fit.

Mr Chipp:

– Give him a chance.


– The honourable member for Hotham knows as well as I do when the time for this debate expires. He knows that the honourable member for Mackellar would stand up in the middle of it, start to move the motion and say: ‘It is over till another day’.

Mr Chipp:

– Give him 5 minutes.


– If he were given 5 weeks he would go back on his word. Would the honourable member for Hotham (Mr Chipp) as a former Leader of the House put up with the things with which I put up this morning and still expect to be able to take the word of the honourable member for Mackellar for anything?

Mr Lynch:

– I rise on a point of order. The Leader of the House is being quite insulting and abusive. It is contrary to the forms of this House to suggest that the honourable member for Mackellar is going back on his word in the manner in which the Leader of the House has suggested it.


– I can assure the Deputy Leader of the Opposition that the honourable member for Mackellar told the Clerk that he has withdrawn the withdrawal. That is precisely what I told the Deputy Leader of the Opposition he would do when the Deputy Leader of the Opposition came to me to negotiate, in good faith, for which I excuse him, on behalf of the honourable member for Mackellar. You cannot negotiate for uncontrollable or unprincipled men.

Mr Wentworth:

Mr Deputy Speaker, that is a complete calumny. It is utterly false. The Minister at the table is telling a stream of falsehoods and I demand that they be withdrawn. It is a complete string of intolerable falsehoods.

Mr DEPUTY SPEAKER (Mr Scholes)Order! The honourable member will resume his seat. The Leader of the House will withdraw that last remark.


Mr Deputy Speaker, I respect the Chair, unlike honourable members opposite and I withdraw the remark. I mentioned these facts so that the House may be fully informed’ of the evasive tactics of the honourable member for Mackellar. He does not have any support for the motion he moved. Now, in the face of everybody, by withdrawing the withdrawal he has shown that he meant to double-cross the Government on this issue and unfortunately, the Deputy Leader of the Opposition also. We both have suffered from the honourable member’s machinations. The Deputy Leader of the Opposition put the matter to me in good faith and with all honesty. The honourable member for Mackellar, for whom the matter was being put. had made his mind up early that he would make a donkey out of Daly and Lynch at the same time. That is precisely what he attempted to do this morning. Therefore I put the record straight. Whatever may be said in respect of the social services legislation is no fault of honourable members on this side of the House that the matter has been delayed. In fact, T had even arranged for the honourable member for Perth (Mr Berinson) and others to participate in the debate. But I felt that I could not allow the conduct of the honourable member for Mackellar to go unchallenged, particularly when the arrangements made were repudiated.

Mr Wentworth:

– I demand a withdrawal at this stage. This is intolerable. I demand an immediate withdrawal.


-Order! The honourable member for Mackellar will resume his seat.

Mr Wentworth:

Mr Deputy Speaker, will you give me some protection under standing order 77.


-Order! The honourable member is getting as much protection as he is entitled to. He is getting far more tolerance from the Chair than I think he is entitled to expect.


– I shall not take up the time of the House further. I have put the record straight. 1 regret what has happened. If honourable members opposite want to avoid this kind of thing in the future I suggest that to put two motions on the notice paper for the same day makes it extremely difficult. But with all the goodwill in the world we hope that both motions on the business paper for today will be disposed of because we would like a vote on both general business matters. Both are important and deserve the consideration of the House. I regret that because of the conduct of the honourable member for Mackellar a very important motion will not be dealt with this morning, to the eternal discredit of the honourable member and those associated with him. The cloud still remains and of course the matter will have to be finalised in Government business in due course without undue delay.

Mr Wentworth:

– I wish to make a personal explanation, Mr Deputy Speaker.

Mr DEPUTY SPEAKER (Mr Scholes)Does the honourable member claim to have been misrepresented?


– Yes. The Leader of the House has emitted what I can only describe as a string of falsehoods. I want to put the record straight by recounting the course of events of this morning. I was asked to withdraw my second motion so that debate could proceed on the first one for the whole morning. I regarded this first motion as being of greater importance and I said that I would withdraw the second motion. I carried out my part of the bargain. The Government welched on its part of the bargain because after I had withdrawn the second motion the Government then welched on, and violated, its part of the pact. It moved the gag and truncated the debate.

Mr Daly:

– I rise on a point of order, Mr Deputy Speaker. I do not like the word welched’ to start with, but apart from that, at the commencement of the debate I raised the point of the question of what debate should take precedence this morning. The honourable member for Mackellar indicated that he had been stood over to withdraw his second motion. This allegation was quite false and incorrect. There was no welching or anything of that kind, but the honourable member indicated-


-Order! The Leader of the House is debating the question. If he wishes to make a personal explanation he may do so when the honourable member for Mackellar has finished speaking.


– The course of events, as I have recounted them, is correct. I withdrew my motion on the understanding that the debate on the abolition of the means test would proceed. On that understanding the Government violated its pledge. Against the arrangements which had been made the Government called on the question to be put; it put on the gag. It stopped the debate.

Mr Hayden:

– I rise on a point of order. The honourable member for Mackellar is not making a personal explanation at all. He is attempting to introduce a new area of debate. In the course of this attempt the honourable member is misleading the Parliament.


-Order! The Minister for Social Security will resume his seat. I will judge whether the matter is a matter for personal explanation or not.


– Thank you, Mr Deputy Speaker. I cannot put the record straight without recounting the course of events as they occurred. I make it clear that I made a bargain. I was prepared to stick to that bargain and I stuck to it. It was the Government that violated it. The Government, against the arrangement that had been made and in entire violation-


-Order! I think that the honourable gentleman has made his pont of order.

Mr Wentworth:

– Thank you.

Mr Hayden:

Mr Deputy Speaker-


-Order! Is tha Minister raising a point of order?

Mr Hayden:

– I am continuing the debate after the Leader of the House.


– No, the debate has concluded.

Mr Hayden:

– Why?


– The Deputy Leader of the Opposition was rising.

Mr Hayden:

– But you have had 2 speakers from that side.


– No, we have not had 2 speakers from that side.

Mr Hayden:

– You have.

Mr DEPUTY SPEAKER (Mr Scholes)Order! The honourable member will not argue with the Chair. The last speaker was the Leader of the House.

Mr Hayden:

– No, there were 2 speakers.


– Order! The last speaker was the Leader of the House.

Dr Klugman:

Mr Deputy Speaker, I raise a point of order. Am I correct in believing that we are now debating a motion to suspend Standing Orders?


– We were debating it; we are not now debating it.

Dr Klugman:

– That was moved by the honourable member for Henty and seconded by the honourable member for Sturt. There have been 2 speakers from the other side and since then there has been only one speaker from our side.


– Order! The practice of the House is to call honourable members alternatively from each side. There is no point of order.

Dr Klugman:

– But you called 2 speakers in a row from the Opposition.


– Order! The honourable member will resume his seat.

Question put -

That the motion be agreed to.

The House divided. (Mr Deputy Speaker- Mr G. G. D. Scholes)

AYES: 49

NOES: 60

Majority .. ..11



Question so resolved in the negative.

page 1395




– I move:

This motion is carefully drawn and relates not merely to the incidents in the House which immediately preceded my giving notice. I do not think that the House wants to censure Mr Speaker nor do I think that the House believes that he ought to be called upon to leave the chair. Nevertheless, I think that in some respects his conduct has been unsatisfactory and more notice should be taken of it than a simple motion of dissent. I have therefore framed my motion in these terms. This is not a censure of Mr Speaker and it is not meant as such. It is something stronger than dissent from his ruling; it is not as strong as a censure. It is meant to be some kind of intermediate motion because he is a new Speaker and, as such, I think that the House should show him tolerance and give him the understanding that always goes to a person who is occupying a new office. Therefore I have moved that in the opinion of the House Mr Speaker ought to be ashamed of himself. I give 2 reasons for this motion. The first relates to Mr Speaker’s failure to apply standing order No. 77 which states:

When any offensive or disorderly words are used, whether by a Member who is addressing the Chair or by a Member who is present, the Speaker shall intervene.

This has been a rule, so far as the present Speaker is concerned, honoured more in the breach than in the observance. I call the attention of Mr Speaker - he no doubt will be reading Hansard record of this debate - to this standing order, and suggest that he consider whether he has been at fault in not applying it more in accordance with the real duties of his office. I hope that in future he will apply it more effectively. I instance 2 incidents. First, something that was said about myself by the Prime Minister (Mr Whitlam). He said at one stage - I think it is on record although I have not checked Hansard, but it was certainly recorded in the Press, - that I ought to be certified. These are quite definitely offensive words which come under the provision of standing order 77. Mr Speaker did not intervene as he should have done. The second incident again refers to the present Prime Minister. On this occasion he was not referring to me but to a former Prime Minister. Gratuitously, the Prime Minister, referring to the right honourable member for Lowe (Mr McMahon) said: ‘Help him to his feet somebody.’ This was a most offensive remark which was meant to imply that the honourable member for Lowe was, in some way, physically incapable of getting to his feet. Anyone who knows the honourable member for Lowe will appreciate that as a squash player he would be able to put to shame for physical fitness most members of this House. It was an offensive remark to have made about any member of this Parliament. It was an especially offensive remark to have been made by a Prime Minister relying on his office. It was doubly offensive when it was made of a former Prime Minister. On that occasion Mr Speaker did not do his duty and intervene. I have given 2 instances, but if honourable members look through the Hansard record they will see that, in fact, there have been more.

Mr DEPUTY SPEAKER (Mr Scholes)Order! The time for the debate has expired.

page 1396



Minister for Services and Property · Grayndler · ALP

– I ask leave of the House to move a motion to enable consideration of general business to continue until 2.45 p.m.


-Is leave granted?

Mr Wentworth:

– No.


– Leave is refused.

Mr Daly:

– I should like, by way of a point of order, to indicate that the Opposition has voted against the extension of general business - private members’ business - on this day and also that honourable members opposite do not want to continue with a motion against Mr Speaker which they know is of importance. That shows that the honourable member is contemptible as I always thought he was.


-Order! That is not a point of order.


– I wish to make a personal explanation.


-Does the honourable member claim to have been misrepresented?


– Yes, Mr Deputy Speaker. 1 refused leave for one purpose only, namely, that I wished to look up some references. This motion came on unexpectedly. I was not prepared for it and I propose to continue my remarks at the (first convenient opportunity.


-Order! I think the honourable member has made his personal explanation.

Mr Daly:

– He is a dingo.

Mr Lynch:

– That is an extremely unparliamentary remark.

Mr Wentworth:

– I ask for a withdrawal of that remark.


– The remark is unparliamentary and I ask the Minister to withdraw it.

Mr Daly:

Mr Deputy Speaker, I always set an example to the Opposition, and I withdraw the remark.


– Order! The time allotted for general business has expired. The honourable member for Mackellar will have leave to continue his speech when the debate is resumed.

page 1397




– I move:

That so much of Standing Orders be suspended as would prevent the debate on this motion continuing.

I regret that there is a necessity for my having to move this motion, but I do so because I believe that this House should not leave on the notice paper a motion which is, in the strictest sense, a censure of Mr Speaker. This matter should not be left in abeyance. I do not give a continental hoot who moved the original motion or from which side he comes. I think it is a bad thing for this House to have this motion on the notice paper.

Mr DEPUTY SPEAKER (Mr Scholes)Order! Is the motion seconded?

Dr Cass:

– Yes, I second the motion.

Question resolved in the affirmative.

page 1397



Debate resumed.


-I continue with what I was saying, unprepared though I am. The first point I make is that Mr Speaker has not complied sufficiently with the provisions of standing order 77. My second point is more substantial. It is that Mr Speaker has shown an undue deference to the Prime Minister (Mr Whitlam). It is very important that our Speaker should be a man of complete impartiality. I am quite aware of the position that the Prime Minister can make or break the Speaker. In the past, I have seen Speakers stand up to Prime Ministers, butI have not seen the present Speaker so willing to stand up for himself against the Prime Minister. It is almost pathetic to see the way in which Mr Speaker glances for approval at the Prime Minister. It is almost pathetic to see the way that he lets the Prime Minister get away with statements and breaches of the rules of this House with a latitude which other honourable members would not be allowed. Honourable members may remember the reactions of Alice in the song ‘Sweet Alice Ben Bolt’. She ‘wept with delight when you gave her a smile and trembled with fear at your frown’. I am afraid that to some extent Mr Speaker has exhibited that kind of attitude to the Prime Minister. It is very important that this should not be allowed to continue, and particularly important in the circumstances of the present Government’s control of this House.

When the present Opposition is in control of the House there is some freedom. We do not have the ironclad laws that the Labor Party has. Unlike the Labor Party, we are not subject entirely to outside control. Under those circumstances in which the Government is the puppet of outside bodies, where the Government by its own admission and by the Prime Minister’s admission in this House is the servant of outside bodies and does what outside bodies command it to do, it is particularly important that the Speaker should not be the puppet of the Prime Minister. It is particularly important that the Prime Minister should not have the power to break with impunity the Standing Orders and rules of this House and have for that purpose a kind of hold over the Speaker.

At this early stage in the life of this Parliament it is a matter of quite major consequence that the relationship of the Speaker to the House should be made clear. The Speaker represents us all. The Chair must be impartial. The Chair should call the Prime Minister to order in the same way that it calls to order any other member. It should not allow the Prime Minister to get away with consistent abuse of the forms of this House. The Chair should have applied standing order 77 to the Prime Minister and should have demanded that the Prime Minister withdraw the unparliamentary things he has said. I will not go through the whole list of them because they are to be found in Hansard.

I heard the Prime Minister say in this House that for the first time we have a Prime Minister who is both courteous and truthful. It is a reflection on previous Prime Ministers and should not have been allowed. Truthful? Let the people judge that. Courteous? Have honourable members noticed the cutting and almost bitchy approach of the Prime Minister? Of course, this man who is now Prime

Minister is the one who was so courteous in 1965. Honourable members will recall the incident. In a debate in this House Mr Hasluck, as he then was, was sitting at the table.


– Order! I suggest to the honourable member that he confine his remarks to the motion before the Chair. He is getting a long way away from the subject. Some of his remarks would be offensive to other members of the House.


– I would just like to say that on that occasion the Prime Minister showed the same kind of attitude which he has subsequently displayed in this House. The attitude that he has in this House, where he has authority, is only a projection-


-Order! I suggest to the honourable gentleman that the motion relates to the Speaker and not to the Prime Minister.


– Of course, and I am pointing out that the Speaker should apply this rule to the Prime Minister because it is particularly dangerous in the present situation for 3 reasons. The first reason is that the Prime Minister has authority. The secondreason is that the authority is subject to the’ control of an outside body. It is therefore particularly important that the Speaker should keep the Prime Minister in order. The third reason is that because the Prime Minister has shown in the past evidence of what we now see at the table, namely, that he is overbearing and-


-Order! I think the honourable member is reflecting on a former Speaker of this House and not debating the motion.


– If you have noticed, as I have noticed, the almost timid and frightened glances running from the present Speaker to the present Prime Minister you would see what I meant. He is frightened of his position.


-Order! I think that remark is offensive to the Chair.


– This is the substance of it.


-Order! I think the remark is offensive to the Chair and I ask the honourable gentleman to withdraw it.


– Yes. I am trying-


-I recognise that the motion is a motion of some form of censure of the Chair but I do not think that that type of remark can be tolerated in the House.


– Quite. I withdraw, as you say. I am not meaning this as censure of the Chair. I am saying that it should be a warning to the Chair, not a censure. I do not mean it as a censure. I mean it as a warning. I am trying to make clear the conduct and attitude of mind which lies behind the conduct which, it seems to me, is the substance of this motion. I have to try to describe what I see as the substance of the motion. It is very difficult for me, Mr Deputy Speaker, in terms of your ruling to proceed in this way. The Speaker does appear to me to be overmuch concerned with what the Prime Minister thinks of him. This is evidenced by the 2 instances I have given in which the Speaker has not used, as he should have done, standing order 77 in order to bring the Prime Minister to heel. It is his duty to do that. It may be that he is not frightened to do it. I must not use that term because you do not think it is the kind of expression that should be used. But there is a difference. When we were in control of the House the Speaker was not frightened of his position. When we were in control of the House there was never any thought of removing the Speaker from the Chair because he was unwilling to be complaisant and because he was unwilling to favour the Government.


-Order! I think that is a fairly serious reflection on the Chair.


– There was no reflection. I am saying that when we were the Government no Speaker-


-Order! I think the honourable gentleman is making a play on words and I think he realises it as well as the House does. I suggest that what he is saying is a very serious reflection on the Chair. If he was moving a censure motion on the Chair I would allow it, but in this form of motion I suggest that he withdraw it.


– Right. If I may not speak of the way-


-Order! I ask the honourable gentleman to withdraw the remark.


– This is the most serious thing I want to say. I want to make it clear that it is very important.


– Order! The honourable gentleman has not withdrawn.


– I withdraw, of course.

Sitting suspended from 1 to 2.15 p.m.


– Before we suspended the sitting for lunch I made some points which I just summarise under 2 heads. First, I think that Mr Speaker has not sufficiently applied standing order 77, which requires him to intervene for the protection of members against whom offensive words have been used, and that standing order puts the initiative on him and not on the member who is offended. I think, as I have said, that the Speaker has honoured this in the breach rather than in the observance. The second and more serious point I made is that I believe the Speaker has been showing too much deference to the Prime Minister and this is particularly dangerous in view of the set up of the party to which they both belong. I do not want to labour this matter.I brought on this motion because I believe that these points should be brought to the attention of the Speaker while the situation is still, as it were, fluid, because he is new in the chair. Mr Deputy Speaker, my seconder of this motion has not been in Canberra this week and is not in the House at the moment. I wanted to have an opportunity to say what I did, but I am not going to proceed with the motion. I am not going to call for a seconder.

Mr DEPUTY SPEAKER (Mr Scholes)Order! Is the motion seconded? The motion is not seconded, so the motion lapses.

page 1399



Ministerial Statement

Minister for Overseas Trade and Minister for Secondary Industry · Lalor · ALP

– For the information of honourable members I present the report of the Committee on Small Business and I ask leave to make a brief statement on the subject of that report.


– Is leave granted? There being no objection, leave is granted.


– This Committee consisted of businessmen and a university professor with experience in the problems of small business management. I express my apprecia tion of the work done by the Committee in analysing the problems it investigated and in making recommendations.

Honourable members, however, may draw their own conclusions about the concern, the interest of the previous Government towards the problems of small business in Australia. Its decision to establish a group of experts to assist the then Department of Trade and Industry in this matter was made early in 1968. The report was completed in and was dated June 1971, but was not published, issued, presented to Parliament or made available for discussion by the previous Government. What went on between June 1971 and the end of 1972 about small business? I have decided now that it should be published and made available to honourable members and the public. Indeed it can become the basis upon which a policy for the development of small business can be worked out.

The terms of reference of the Committee were restricted to exploring ways of providing guidance to small business management to help in improving efficiency, rather than in undertaking a comprehensive investigation of the role of small business in the economy and of the problems faced by small business. Accordingly, the emphasis of the report is upon management aspects of improving small business efficiency. It concluded that Government initiatives are necessary to develop a coordinated plan to assist small business to increase its efficiency. Specifically, the Committee recommended that a continuing body should be established to initiate, promote, and, where necessary, implement proposals for the guidance of small-business management. The report as I have said, has not been considered in detail by the Government, but the Government is concerned to undertake a comprehensive program within the concept of the small business administration which was approved by the 1971 Launceston Federal Conference of the Australian Labor Party. The economic planning section of the Labor Party’s policy commits this Government in its platform to:

Assist small primary producers, retailers and others to adjust to changing economic conditions by expanding Agricultural Extension Services, by using Rural Reconstruction Boards, by establishing a Small Business Administration -

That is the point I emphasise in this context

And by instituting programs to retrain and resettle small producers and retailers.

The Government believes that small business has and ought to have a vital role in the economy. Those businesses employing fewer than 100 persons, those employing fewer than 25 and even fewer than 4 are an extraordinarily large number of units and they have remained throughout the growth of big business a fairly constant proportion of the total, and they service the largest economic organisations in the community in a very vital and significant way. There is considerable scope for active government initiative in strengthening not only the competitiveness but also the contribution that small business makes to the economy. This initiative is all the more important in view of the disturbingly high level of the concentration of ownership within the Australian economy and particularly the level of foreign ownership which has been encouraged to develop.

It will be noted that the Committee considered that some important factors affecting small business, such as business financing, were outside its terms of reference. I make no comment on that, but it is surprising that such a thing was left outside the terms of reference. However, it noted also the need for study in depth of the financial matters affecting small business, and I agree with this view. Indeed, it is perhaps the most important aspect of the subject. I agree also with the basic view put forward by the Committee that there is a need for a continuing body to give specific attention to the special problems and needs of relatively small enterprises. As a first step, I am proposing to establish within the Department of Secondary Industry a unit or section which would specifically consider the problems encountered by Australia’s small manufacturers and, where appropriate, prepare recommendations on measures that might be required to meet these problems. It is from this section of the Department of Secondary Industry that I anticipate getting the advice and recommendations upon which the Government will act as soon as possible. I do not expect that it will take long to arrive at positive proposals to put before the Cabinet and the House. In the meantime, I would like to give notice to the Parliament and to the people that the Government will soon take action to assist small business.

The Government recognises the importance of small business in the Australian economy. As figures quoted by the Committee’s report show for the year 1967-68 factories of 100 persons or fewer accounted for 47 per cent of all employment in manufacturing, 40 per cent of the total value of output and 96.5 per cent of all the factories. They were a total of 60,761 factories. I have mentioned their significance in relation to the large industrial concerns, those with 300, 1,000 or more employees over. The way in which they integrate into the large firms and the large factories is of quite fundamental importance. The significance of small business is even greater outside the manufacturing area although it may not be of greater economic significance. Furthermore, whereas there is a very high level of foreign ownership of large manufacturing enterprises, there is a very large percentage of Australian ownership in the smaller manufacturing enterprises.

Some guidance on the initiatives that can be taken in Australia to assist small business can be seen in the examples set out in the Committee’s report of what is done in other countries. These include institutions which are specifically involved in assistance to small business, such as the German Management and Productivity Association (RKW) of the Federal Republic of Germany; the Small Business Administration of the United States; the Smaller Enterprise Agency of Japan; and the industrial liaison scheme in the United Kingdom. The report outlines a wide and detailed range of measures taken overseas in matters such as management assistance, technology, consultancy, training, and financial measures, which have never been even considered in Australia let alone any move made for their application. It seems to me strange that, after 23 years of Liberal-Country Party Government, supposedly concerned with enterprise and small business, this is the case. I invite and welcome suggestions and proposals from members of Parliament and the public on this matter, and I look forward to receiving suggestions and proposals, especially from people involved in small business, consultants, academics, inventors and others who can help to provide the best advice to specialists in my Department so that the legislation which the Government anticipates introducing within a short term can be the most appropriate for its purposes.

I present the following paper:

Committee on Small Business - Ministerial Statement, 12th April 1973.

Motion (by Mr Crean) proposed:

That the House take note of the paper.


– Apart from tabling the report, the Minister for Secondary Industry (Dr J. F. Cairns) is hardly advancing his Government’s activities at all. All that he said has been said before by the previous Minister for Trade and Industry, the present Leader of the Australian Country Party (Mr Anthony), who will speak with me on this matter, and his predecessor as Minister for Trade and Industry. However, I join the Minister for Secondary Industry in congratulating and expressing appreciation to the Committee on Small Business which is under the chairmanship of Fred Wiltshire. What the Minister has said is merely a continuation of the previous Government’s policy regarding small business and the gratuitous remarks of the Minister about the previous Government frankly can be left as stated, which is possibly more than they deserve.

The significance of small businesses in Australia is well known and the Minister’s figures and percentages put before the House today are accepted. They, too, have all been quoted often enough before. I have not had the opportunity in the short time available to reread the report but the important thing in respect of small businesses as in Australia is not to control them but to seek to remove their problems and allow the competitive processes to operate. It appears from the summary at the commencement of the report that the major and basic problems of small business are succinctly dealt with. These problems include dealing with money matters, decision making and working under pressure. These are the sorts of problems with which small businesses such as small companies and family firms are saddled. In addition there is the lack of capital and lack of power to delegate to others. They all create problems in competing with larger corporations. In my view probably the 3 major problems of such businesses are the financial problems including taxation, management and the domination by big firms and the danger of takeovers. These matters are dealt with in the report the summary of which says in relation to the financial problems:

Where this ls an ignorance of business and money management, production, planning and marketing, this must limit the assistance which can be obtained through the normal financial channels.

It is fair to point out that most small businesses and others who have looked at the matter generally accept that there are limited sources of growth capital.

Debate interrupted.

page 1401



– Order! I have to inform the House that we have present in the gallery this afternoon a parliamentary delegation from Indonesia Jed by the Honourable Mohammad Isnaeni. On behalf of the House I extend a very warm welcome to these gentlemen.

Honourable members - Hear, hear!

page 1401


Ministerial Statement

Debate resumed.


– It is generally accepted that there are limited sources of growth capital for proprietary companies in Australia. A private or proprietary company in Australia simply has no access to the money market and the stock exchange and so has only limited areas from which to draw funds for growth. Prior to 1950 it is as well to remember that the trading banks supplied a considerable proportion of the growth capital requirements of proprietary companies. The present policy appears to be based on the concept that it is not for trading banks to supply long term funds to business enterprises but rather to accommodate them for the shorter term fluctuating work capital requirements. In 1945 the Industrial Finance Department of the Commonwealth Bank of Australia was established specifically to provide finance for the establishment and development of industrial undertakings, particularly small undertakings where capital could not be obtained through ordinary commercial channels. In 1957 the Industrial Finance Department and the Mortgage Bank Department of the Commonwealth Bank were merged into the newly created Australian Development Bank but their functions remained substantially unaltered.

Because potential borrowers often have difficulty in demonstrating to the bank that there are reasonable prospects of continuing to be or becoming a profitable undertaking, finance from this source is not alawys readily available. I recall that before taking over a portfolio a few years ago I drew attention to this point in the House in respect of one industry in particular where I felt the Development Bank was not fulfilling its charter. The main source of finance to proprietary companies is usually made in one form or another by proprietors, members of their family and shareholders and consequently they are generally undercapitalised. Necessity obliges them to plough back as much as possible into the company but this does not in many cases meet the problem of financing growth. I know there are other avenues that are used, such as life assurance societies, the facilities of hire purchase companies particularly for plant and equipment, leasing of factories and buildings, factoring of book debts, the borrowing on floating charge over the assets and undertakings of the company and so forth. But the lower rates of primary tax also affect the situation. The lower rates of primary tax applying to the proprietary company, compared with those applying to the public company, are a helpful concession towards accumulating capital but this concession is soon dissipated by the incidence of the undistributed profits tax at the rate of $1 in every $2, if a company fails to make a sufficient distribution of its profits after tax within the prescribed period.

The forced distribution of dividends forces taxable incomes into the hands of shareholders but the taxation legislation does allow the dividend to be declared and to be paid to the shareholders who can pay it back to the company or have it credited to their accounts. It is possible, therefore, for the company to preserve its liquidity by not parting with the funds but personal taxation paid by the company for the shareholders from its loan account depletes the resources accordingly. I have mentioned those points only because I know that the lack of finance is uppermost in the minds of those who are in charge of proprietary companies or small businesses.

So too with this question of management itself, in the field of ownership and management the small firm has very special difficulties. Death duties cause special problems in family firms and even if they can be overcome frequently there are difficulties in ensuring adequate succession of competent ownership and control. Big firms can, as I mentioned earlier, employ specialist managers and a great deal of work can be delegated through the administrative system. In small firms not only are many proprietors completely unwilling to delegate but frequently they do not have anyone to whom they can delegate and the owner of a small firm may well have to be the production manager, sales manager, personnel manager and financial manager all rolled into one.

It is pleasing to see that the report that the Minister tabled goes into this area for there are a number of important economic functions performed by small firms and they make a very special contribution to the wellbeing of the economy. These functions include being an important derivative of innovation in techniques, products and services notwithstanding the comparatively low expenditure on research and development. The small firms can provide competition and a check on would-be monopolies and indeed on the inefficiencies which can breed on monopolistic practices. Thus the economic system as a whole benefits by their existence. They act as specialist suppliers of parts and components to larger companies. They add greatly to the supply of products and services offered to the consumer, and above all they provide a means of entry into business for new commercial and entrepreneuria talent from which companies can grow and stimulate established leaders of industry, and for that reason alone they ought to be supported.

The Minister has mentioned overseas examples and the one that readily comes to mind is in the United States where thousands of small businesses are helped to stay competitive under the United States Government’s small business administration scheme. Much can be learnt from that scheme. I urge those honourable members who are interested in this matter to read the United Kingdom Bolton Committee report presented to the House of Commons in November 1971. The Minister has not mentioned it. I am sure his attention will be directed to it. The Leader of the Australian Country Party (Mr Anthony) will follow me in this debate so I will conclude my remarks. I have cautious optimism concerning the future prospects for small businesses in Australia provided that the obstacles which inhibit or restrain small firms are removed. As I said at the outset, the real need is to remove those barriers and allow the competitive processes to operate. As to how these businesses will cope with the environment established by this Government remains to be seen.

Leader of the Australian Country Party · Richmond

– I should like to speak for a few moments on this subject and say how much I welcome the tabling of this report. For various reasons the report was not tabled during the lifetime of the previous Government. I had charge of this report and I believe that the tabling of it will be of great value to small businesses. I believe that it demonstrates recognition of an excellent job done by Mr Wiltshire, the Chairman of the Committee. In 1968 the then Minister for Trade and Industry, Sir John McEwen, announced the appointment of an expert group set up to assist the Department of Trade and Industry in exploring ways of providing guidance to small industry management in order to help improve efficiency. The previous Government’s decision to act in this field was in recognition of the vital role of small business in the Australian economy particularly in respect of the preservation and stimulation of competition which is the mainspring of efficiency and also by providing a wide range of employment opportunities and scope for innovatory talents, personal initiative and judgment. It is clearly in the national interest that small business management should receive guidance as to the best way to deal with its problems. The members of the Committee, particularly the Chairman, deserve to be congratulated for the excellent job they have done in bringing down this report on the way in which small businessmen can be helped to improve their efficiency.

The Minister has questioned the sincerity of the previous Government in setting up the Committee.

Dr J F Cairns:

– I changed that word.


– I thank the Minister for saying that he has now changed that word. 1 am sorry that I did not hear him say it. I can assure the Minister that the previous Government was very genuine. I pose this question: I wonder just how sincere the present Government is in showing a willingness to help small businesses because many of the actions of this Government in recent weeks have hurt both large and small industries and will continue to hurt them. I think of revaluation and also the Government’s obvious inability and what seems to be a lack of willingness to try to get at the basic cause of inflation - that is, excessive wage rates - in the community. One must really ask whether the Government is fair dinkum when it says that it wants to try to control inflation and thereby help the small business firms which feel the impact of these inflationary pressures very severely indeed. If the kind of treatment that this Government is handing out to the small business of farming is any indication then the rest of the business community has not really very much to look forward to.

The previous Government set up this Committee under the chairmanship of Mr Wiltshire because it recognised the great importance of small business to the Australian community. As the Minister for Overseas Trade and Minister for Secondary Industry (Dr J. F. Cairns) said in his statement, in 1967-68 factories employing 100 or fewer people accounted for over 96 per cent of all factories in Australia. So small business is really big business in this country and it demands close attention by this Government. The Committee found from its investigations that problems encountered by small business are pretty much the same as in every country. The importance of small business is obvious from the figures which the Minister quoted and which were taken from the Committee’s report. Small business is a major component of the industrial and commercial life of every country and the problems and difficulties arising from smallness are universal. In many countries the government provides assistance for small business and the form in which it is offered varies from one country to another according to the social organisation and the temperament of the people concerned. In the report there is a recommendation on the forms of assistance which the Committee considers would be ideally suitable for the Australian environment.

The importance of small business must be viewed in purely statistical terms. It provides opportunities for the expression of independence, initiative, enterprise, the play of competition, the encouragement of special talents and technical skills and a counterbalance to the concentration of economic power. Our industrial structure relies on the supporting facilities which small business provides. There are considerable areas in manufacturing and service industries where the owner-proprietor type of business provides a more economic form of organisation than does a large company structure. Some small businesses have within them the seeds of growth into new large industries. In some cases owners of small businesses think that the shortage of funds is one of their significant problems and that their size and legal status place them at a disadvantage vis-a-vis large enterprises with public company status. They therefore hold the view that government should assist by making a review of income tax retention allowances and granting more liberal investment allowance and other forms of financial incentives. I hope that when the Government is reviewing its policies in relation to export incentives and investment allowance it will remember that many small businesses owe much to the previous Government’s initiative in bringing these things forward to enable them to grow into enterprises of some standing and significance.

The small business sector of Australian industry is of national importance, as I mentioned. It has great potential for economic growth and for efficient development. I believe more attention could be given to means whereby this important part of the national economy might be assisted in its development. The provision of assistance which is acceptable to small business will require a thorough understanding of the real nature of small business, the people involved and their problems. I believe that the report that has been tabled today, if studied by students of business and by small business itself will enable them to have a much better understanding of what small business really means. I believe that educational and training institutions have not directly concerned themselves enough with these, matters and without the help and encouragement along the lines now proposed in this report much might bc forgotten or neglected if these institutions do not h.’Ip by providing the interest and attention that is needed.

An important role for the Government to play is that of a catalyst stimulating and motiving the managers of small businesses and all bodies capable of serving them such as industry organisations, professional bodies and the educational institutions that I mentioned. The Government will need to coordinate the activities of such organisations and provide the essential support facilities. No private body is likely to take on this role, noT would a private body be likely to have the necessary status and authority to motivate such dispassionate bodies into implementing necessary courses of action without the encouragement and support of the Government. I believe that the Government can satisfactorily and effectively undertake the function of acting as the necessary catalyst to help the development of small business fcl this country. I believe that if the Government is genuine in its attempts the report will serve a very useful purpose.

Question resolved in the affirmative.

page 1404


Ministerial Statement

Treasurer · Melbourne Ports · ALP

– by leave - I have recently returned from a brief visit to Washington where I participated in discussions on reform of the international monetary system. These were discussions between finance ministers and treasurers of a representative group of countries known as the Committee of Twenty. This Committee was established in July 1972 by a resolution of the Board of Governors of the International Monetary Fund. The Committee is charged with the task of reporting to the Board of Governors on all aspects of reform of the international monetary system. Australia is one of the 20 countries which is a full member of the Committee. It has special significance for us as a group, limited in size, in which we can hear the views of others and express our own views on these matters.

The decision to establish the Committee of Twenty had its origins in the currency crises of the late 1960s and early 1970s. In recent years these crises have increased in terms of both frequency and severity. This has raised doubts about the international monetary arrangements under which countries have been operating over the past quarter of a century.

According to one view, the present Articles of Agreement of the International Monetary Fund were drafted primarily to deal with the problems of the 1930s - world wide depressions and vast unemployment, widespread restrictions on trade and payments, declining levels of international trade, competitive exchange depreciations and a complete breakdown of international co-operation. These are not the basic problems of the 1970s. What we now need, according to this view, is something which helps us deal with the problems of the 1970s - world wide inflation, disequilibriating capital flows, competitive nonrevalutions and the break-down of the balance of payments adjustment process, in a world in which national economies are much more closely inter-related and inter-dependent in terms of trade and capital flows.

However, according to another view, the break down in the balance of payments adjustment process is due as much to the failure of individual countries to observe the rules of the system, as to the system itself. In particular it is argued that the current instability is largely a by-product of the continuing United States balance of payments deficit - a deficit which reached the astronomical proportions of around $US30 billion in 1971. The United* States, it is said, should have taken earlier action to correct the deficit by slowing down internal inflation for example, by curbing capital outflow, by devaluing the United States dollar, or by some combination of these policies. Likewise the surplus countries operating within the existing Articles of Agreement of the International Monetary Fund should have taken earlier action to check the growth in their reserves by curbing capital inflow, by revaluing their currencies, and so on.

Probably there was some truth in both these points of view. More recently, however, developments in the international monetary situation have put a new slant on the discussions. One important fact is, of course, that the United States now has taken significant steps to correct its balance of payments deficit. In the first place the United States Government did take firm action domestically and this reduced its rate of inflation below that of nearly all major developed countries.

Then there was a general re-alignment of currencies which occurred at the time of the Smithsonian Agreement at the end of 1971. At that time the United States agreed to devalue the dollar by approximately 8 per cent. At the same time some of the surplus countries including Germany, Japan, Belgium and the Netherlands revalued their currencies upwards. This realignment was a positive contribution by both deficit and surplus countries to the attainment of better international balance of payments equilibrium.

However progress towards better balance was slow. The large United States deficit on current account continued, as had been expected, into 1972, But in addition there was no net reflow of short-term funds to the United States during 1972 as a whole. The floating of sterling in June 1972 cast some doubts on the viability of the new exchange rate pattern and by early 1973, with reserves still rising in Europe and Japan, there was a growing belief that some further realignment of exchange rates might be necessary.

In January 1973 the Italians, who had been experiencing a capital outflow, introduced a 2-tier exchange rate system. Almost immediately the Swiss, who had been experiencing substantial capital inflows, decided to allow the Swiss franc to float. There then ensued what has come to be known in Europe as the ping-pong’ effect, with capital bouncing over the border from Switzerland, which had taken new additional measures, to Germany and other European currencies, which had not. In the first 9 days of February 1973 the central banks of Europe and Japan absorbed no less than $US9 billion. The German central bank alone took in some $US6 billion. The exchange rates of most of the European currencies rose strongly in the market. It was then, on 12th February 1973, that the United States took a further decisive step by unilaterally devaluing the dollar another 10 per cent. At this time the Japanese authorities decided to allow the Japanese yen to float upwards in the market.

There was a strong body of opinion to the effect that this February 1973 readjustment of exchange rates should have been sufficient, in the long term, to achieve the international balance of payments adjustment required, particularly if there was reasonable progress in reducing trade barriers as a result of the discussions due to begin in September under the auspices of the General Agreement on Tariffs and Trade. But the markets themselves did not reflect this optimism. Indeed, by the end of February 1973 speculative capital flows to Europe had again reached overwhelming proportions. In one day alone the German central bank took in no less than SUS2.7 billion. The Europeans and the Japanese closed their foreign exchange markets for roughly 2 weeks in the first half of March 1973. When the European markets did reopen on 19th March it was on the basis that they would no longer maintain the established margins against the US dollar. A number of the European countries agreed to maintain maximum exchange rate margins of 2.25 per cent against each other. Others, including the pound sterling and the Italian lira, continued to float independently. In other words the major European countries, collectively or individually, were floating in relation to the US dollar, as were the Canadian dollar and the Japanese yen.

It was in the shadow of these events that the Committee of Twenty gathered in Washington for its second meeting on 26th and 27th March. It was no longer a question of considering in academic fashion what changes in the monetary system might be desirable. The fact was that the monetary system set out in the Articles of Agreement of the International Monetary Fund had, in some basic respects, been abandoned by the major countries. And yet it was important not to be unduly influenced by these measures, taken under pressure, in assessing the needs of the longer term future. On the whole I believe the Committee took a properly balanced view in this respect. A number of specific issues were touched upon by the Committee of Twenty at its March meeting and I briefly list some of them:

  1. There was the question of the extent to which the monetary system of the future should be based on stable but adjustable par values as set out in the present Articles of Agreement. The Committee was of the view that this should continue to be the case but it was also recognised that floating rates would provide a useful technique in particular situations.
  2. There was the question of disequilibrating capital flows. The more recent currency crises reinforced the general view that this was a most important area for future work. It was agreed that a study should be made of effective means of dealing with this problem both by controls to influence such flows and by arrangements to finance and offset them.
  3. There was the question of international liquidity. It was recognised that with the very large increase in short-term US dollar liabilities, international liquidity was running at very high levels. It was envisaged that the role of reserve currencies in the international monetary system should be reduced and that the special drawing right should become the principal reserve asset of any reformed system. This, it was generally held, would be a contribution to better international management of global liquidity.
  4. There was a general wish that effective convertibility of the United States dollar into other reserve assets should be restored. The United States had of course formally ceased to maintain convertibility of the US dollar into gold and other assets as from 15th August 1971. This led to suggestions for what is technically called a ‘reserve asset settlement’ scheme. It implies that the United States should once again receive primary reserve assets if it is in surplus, and should lose them if it is in deficit. But before the United States could assume such a ‘convertibility’ obligation, it was suggested that excess’ holdings of US dollars, and for that matter sterling, should in some way be funded. What this would mean in practical terms for Australia is that some part of our existing dollar and sterling balances would be set aside, or frozen, on terms as yet undisclosed. During the discussions in Washington, I made it quite clear that Australia could not support any such arrangement for dealing with the ‘dollar overhang’ problem which was not based on voluntary participation by the holders, for whom the dollars represented not an ‘overhang’ but national reserves.
  5. Then there was the question of the role of developing countries. The general view was that their special interests had to be borne in mind in any reformed system. This subject was not discussed in any detail at this meeting of the Committee, but will be taken up at a later date.
  6. Most important of all, however, there was the general recognition by the Committee of the need for a better working balance of payments adjustment process, and of the importance of effective domestic policies for this process. It was agreed that methods should be devised to ensure timely and effective balance of payments adjustments by both surplus and deficit countries. In this connection a technical group was appointed to consider a United States proposal that a system of ‘objective indicators’ be introduced to signal the need for balance of payments action by individual countries. On this issue of the balance of payments adjustment process I was able to point out, both in Washington and subsequently in New York, that Australia was one country which had not waited to be told by an international organisation, or by its trading partners, or by some system of objective indicators, what it needed to do. The action this Government took in December 1972 to revalue the Australian dollar and to check speculative capital inflow was taken in Australia’s own national interest. But it was also exactly what would have been expected of it if the international balance of payments adjustment process is to work effectively.

The Committee of Twenty has not fixed the date of its next meeting. This will be determined in the light of the progress made by its various sub-committees and technical groups.

There is still a long way to go, as I see it, before a general consensus will emerge as to the monetary system which should apply in the future. However, notwithstanding some divergent points of view on various aspects of this matter, I think there are 2 basic points on which most countries would now agree. The first is that any monetary system of the future will need to pay due attention to the sovereignty of national governments. The second is that no new system, however well designed, will work unless the countries participating in it are prepared to co-operate in making it work. To that end there is general agreement that the role of the International Monetary Fund, as a forum for international co-operation in this matter, should be strengthened. I believe it is important, from Australia’s point of view, that this should be so.

We have an independent and growing economy, and we are jealous of our national sovereignty. At the same time we are living in a world where commercial and financial links between countries are growing. It is a world where some countries in their own interests are merging into regional blocs. If we are to maintain our independence, and if we are to maintain our economic advancement, we need a sound international monetary system which essentially provides for a multilateral rather than a regional or bilateral approach to world financial arrangements. That was one of the prime considerations for our giving our support to the establishment of the International Monetary Fund after World War II. That consideration is equally valid today.

I have given this brief account of some of the background to, and main issues surround ing, the recent meeting of the Committee of Twenty in order to inform the House of progress on these matters. For the information of honourable members, I also present the communique issued by this meeting of the Committee of Twenty, together with a glossary of terms, which the Treasury has prepared for me, and which I have found of assistance in these financial discussions. I seek leave to have those 2 documents incorporated in Hansard.


– Is leave granted? There being no objection leave is granted. (The documents read as follows) -

Communique of (be Committee of Twenty Washington 28th March 1973

The Committee of the Board of Governors of the International Monetary Fund on reform of the international monetary system and related issues (the Committee of Twenty) held their second meeting in Washington on 26th and 27th March 1973, under the chairmanship of Mr Ali Wardhana, Minister of Finance for Indonesia.

By the courtesy of the Organisation of American States the meeting was held in the Pan American Union Building.

Mr Pierre Paul Schweitzer, Managing Director of the International Monetary Fund, took part in the meeting which was also attended by Mr Wilhelm Haferkamp, Vice-President of the EEC, Mr Rene Larre, General Manager of the BIS, Mr Emile Van Lennep, Secretary-General of the OECD, Mr Oliver Long, Director-General of the GATT, Mr Manuel Perez-Guerrero, Secretary-General of the UNCTAD, and Sir Denis Rickett, Vice-President of the IBRD.

The Committee received a report in which the Chairman of their Deputies, Mr Jeremy Morse, summarised the Deputies’ discussions to date on the adjustment process and exchange rate mechanism, reserve assets and convertibility, and capital flows.

The members of the Committee reaffirmed the need for a world monetary order, based on cooperation and consultation within the framework of a strengthened International Monetary Fund, that will encourage growth of world trade and employment as well as economic development and will support the domestic efforts of monetary authorities throughout the world to counteract inflation.

The members of the Committee exchanged views on the substance of international monetary reform in the light of recent developments in exchange markets and of countries’ policy reactions to these developments, and instructed their Deputies to take account of these events and their implications in their continuing work.

The members of the Committee recognisedthat the various elements of reform are inter-linked.

Their discussion of a reformed system centered on the following points:

There should be a better working of the adjustment process, in which adequate methods to assure timely and effective balance of payments adjustment by both surplus and deficit countries would be assisted by improved international consultation in the Fund including the use of objective indicators. It was noted that the Deputies are establishing a technical group on indicators.

The importance of effective domestic policies for balance of payments adjustment was underlined.

Members of the Committee recognised that exchange rates must be a matter for international concern and consultation and that in the reformed system the exchange rate regime should remain based on stable but adjustable par values.

It was also recognised that floating rates could provide a useful technique in particular situations.

There was also general agreement on the need for exchange market stability and on the importance of Fund surveillance of exchange rate policies.

  1. There should be better international management of global liquidity.

The role of reserve currencies should be reduced and the SDR should become the principal reserve asset of the reformed system.

The Deputies were asked to study further the conditions for a resumption of general convertibility, including questions relating to consolidation of excess reserve currency balances and to methods of settlement.

  1. An intensive study should be made of effective means to deal with the problem of disequilibrating capital flows, including those associated with Euro-currency markets.
  2. There should be a strong presumption against the use of trade controls for balance of payments purposes.

Developing countries would, however, be exempt wherever possible from trade and capital controls imposed by other countries and their particular circumstances would be taken into account in assessing controls that they themselves felt it necessary to apply.

  1. The members of the Committee recognised the concerns of developing countries under current conditions and their interests in a reformed system.

They affirmed the desirability on the occasion of the reform of promoting economic development and the flow of real resources from developed to developing countries.

  1. The Committee approved their Deputies’ program of future work.

In directing the attention of the Deputies to those aspects of reform which have an important bearing on the current situation, they recognised that procedures are already established for co-ordinating the work of the Executive Directors of the Fund with that of the Deputies.

They noted that the Deputies plan to expand their meeting schedule and to intensify their work between meetings, and they instructed the Deputies to proceed urgently with the preparation of a draft outline of the reform, in which the major issues would be presented to the Committee for decision.

  1. The Committee will meet again at a time to be proposed by the Chairman in the light of the progress of the Deputies’ work.

page 1408


A. Balance of Payments Adjustment Process

Exchange rate arrangements - Bretton Woods system - Wider margins - Floating exchange rates - Alternative exchange rate arrangements including crawling peg and objective indicators - Intervention systems

  1. Convertibility and Asset Settlement


Deficit financing

Asset settlement

  1. Reserve Assets

Reserve currencies - Dollar overhang including substitution and funding

Gold - Numeraire - Two-tier gold market

Special drawing rights - including allocations, designation, obligation to accept. - The ‘Link’

  1. Capital Movements


Leads and lags

Covered interest differential

Disequilibrating flows

Treatment of capital flows - Forward intervention - Harmonization of monetary policies - Swaps

A Glossary of Terms Relevant to Reform of the International Monetary System (The following simple glossary is intended to be no more than a brief introduction to some of the issues involved in reform of the international monetary system, and has been prepared to assist honourable members who may be interested.)


Exchange Rate Arrangements - ‘Bretton Woods System’ (or ‘Par Value System’). The exchange rate system approved at the Bretton Woods Conference in 1944 involved an obligation upon countries to contain their exchange rates within fixed margins or bands of 1 per cent around par values agreed with the International Monetary Fund. As a protection against competitive devaluation, the par value could be changed only when a country faced a ‘fundamental disequilibrium’ in its balance of payments. The term ‘fundamental disequilibrium’ has never been precisely defined, but it is intended to describe a situation in which a country is in an external disequilibrium, which can only be overcome by the imposition of restrictions or by unacceptable domestic deflation or inflation or by a change in the exchange rate. Once that situation has been reached, exchange action should be initiated. - Wider Margins

On 18th December 1971, a decision was taken at the International Monetary Fund that preserved the Bretton Woods concept of stable but adjustable par values but widened to2¼ per cent on either side of the par value, the margins within which the exchange rates could fluctuate. The .nain purpose of this was to allow countries to maintain differential interest rate policies without experiencing heavy inflows (or outflows) of interest-sensitive short-term capital. The widening has also been seen as a means of making marginal adjustments in the competitive position through a marginal movement in the market exchange rate as distinct from a change in the par value. These 2 functions are presumably mutually exclusive. - Floating Exchange Rates

Under a floating system, exchange rates are determined primarily by the day-to-day forces operating in foreign exchange markets. There are several examples of floating rates at present, including the Japanese yen, the Canadian dollar and the pound sterling. Within this general system a number of possibilities can be distinguished:

Dirty’ floating is a pejorative term (the alternative being ‘clean’ floating) in which national authorities ‘manage’ the float, intervening in the foreign exchange market to buy or sell foreign currencies with their own currency to prevent an unwanted degree of movement in the exchange rate. (Intervention merely to smooth out short-term fluctuations in the exchange rate is generally regarded as legitimate.)

Legalised temporary floating has been suggested as a possible safety valve for a system of stable but adjustable par values. The exchange rate would be allowed to float on a temporary basis, under IMF supervision, to help find the right level for a new fixed exchange rate, when the existing rate could not be sustained because of speculative pressure. (At present the Fund has no authority to approve floating under any circumstances.) - Alternative Exchange Rate Arrangements

Participants in the reform exercise are generally agreed that exchange rate adjustment should be undertaken more frequently than was the practice under the Bretton Woods scheme. Two possible arrangements that would increase the degree of flexibility of a par value system are discussed below:

  1. ‘Crawling peg* This would involve adjustment of the par value at regular intervals (e.g. annually or more frequently) to the prevailing market rate or according to some predetermined formula. This would produce small, regular and sometimes automatic changes in the par value.
  2. Use of ‘Objective Indicators’ (also ‘Quantitative’ or ‘Presumptive’ Indicators). Indicators refer generally to readily available sets of figures (such as the level of reserves) which can be used to give an indication of the appropriateness or otherwise of a country’s exchange rate. Their objectivity arises from their statistical nature which should leave them relatively free from political influence.

The significance of objective indicators derives from the establishment of outer values of the indicator or ‘trigger points’ at which a signal of balance of payments disequilibrium is emitted and at which, as a minimum, international consultation on the country’s exchange rate should occur. A stronger view is that the signal from an indicator should create a presumption that the country whose indicator gives the signal should initiate some kind of corrective action possibly in the exchange rate field.

The statistical series most favoured as objective indicators at present are the basic balance of payments position, the gross reserves or net reserves of the country in question:

  1. ‘Basic balance’ means the overall balance of payments position excluding reversible shortterm capital flows; it gives a better idea of the underlying balance of payments position than the normal balance of payments figure does. (Australian balance of payments data do not permit the calculation of basic balance.)
  2. ‘Gross reserves’ means a country’s total holdings of international reserve assets, comprising gold, SDR, reserve position in the Fund and reserve currencies (US dollars, pounds sterling etc.).
  3. ‘Net reserves’ means gross reserves minus any IMF credit to the country minus liabilities to foreign official holders (i.e. holdings of the nation’s currency by foreign central banks). Major reserve currency countries have negative net reserves.

Positive guidance’, ‘graduated pressures’ and ‘sanctions’ are terms used to describe possible action by the international community against a country whose indicators remain outside the trigger points. Possible courses of action range from consultation and suggestion to measures adopted by individual countries (with international approval) to discriminate against the trade of the offending country and/or the composition of its reserves.

As part of a system of objective indicators and generalized convertibility’, the United States introduced the concept of ‘convertibility points’ i.e., levels of holdings of primary reserves (gold, SDR and reserve position in the Fund) above which a country would no longer be able to convert reserve currency balances into primary reserves. This is presumably intended as an incentive for surplus countries to respond to the signals of objective indicators. - Intervention Systems

Multi-currency intervention’ (MCI) is an arrangement by which participant countries would maintain permitted margins by buying or selling the currencies of each other country on the foreign exchange market. This arrangement neutralises the special ‘intervention currency’ role of the United States dollar under the Bretton Woods system. The present European ‘joint float’ is an example of multicurrency intervention.

Single-ended MCP is a particular form of MCI in which, to avoid the possibility of mutually conflicting market behaviour, responsibility for intervention is allocated either to the country whose currency needs support (‘floor intervention’) or whose currency is under strong upward pressures (‘ceiling intervention’). The present joint European float employs a double-ended MCI system, where intervention is carried out by either the floor’ currency or ‘ceiling’ currency country or by both simultaneously.


– Convertibility

Market’ or ‘Article VIII’ convertibility means that the currency is available for payments and transfers for current international transactions, including redemption of officially held balances acquired from or needed for current transactions. The Australian dollar has this quality. The United States dollar retains it, though there is doubt about the extent to which the United States is prepared to convert officially held balances of its currency.

Gold Convertibility’ refers to the undertaking by the United States to ‘freely buy and sell’ gold, officially withdrawn in August 1971. Any future assumption of a convertibility obligation by the US would take the form of convertibility into ‘primary reserve assets’ (gold, SDR or reserve positions in the Fund). - Deficit Financing

Since World War II the United States in particular has been able to finance a large part of its balance of payments deficits by means of its own currency which was acquired and held without conversion (into reserve assets) by countries that ran overall payments surpluses. This is ‘deficit financing’. Almost all other countries are obliged to finance any payments deficit entirely by running down reserve asset holdings or by negotiating temporary credit. - Asset Settlement

This is a system under which the payments imbalances of all countries, including reserve centres, are settled by the transfer of reserve assets. It therefore places an obligation on the issuer of a reserve currency to convert into primary reserves any net increase in its liabilities to official holders. In return the issuer would be assured of acquisition of primary reserves to the extent of any surplus it had. The twin objectives of this system are (a) to place a discipline upon reserve centres and (b) to control the growth of international liquidity.


Reserve Currencies - Dollar overhang

Official holdings of US dollar liabilities can refer to the disparity between the size of these outstanding claims and the level of US official reserves nominally available to finance the claims. Alternatively, it can be thought of as the amount of dollars not willingly held and that would be converted if that were allowed by the US.

Various proposals have been put forward to deal with the problem. Any operation by which the holders of reserve currency balances exchange these for an alternative asset which does not constitute a direct or immediate claim on the reserve centre is termed consolidation. It may take two forms - ‘substitution’ or ‘funding’.

Substitution involves the replacement of liquid reserve currency balances by other liquid claims in the form of SDR in the portfolios of reserve asset holders, generally through a ‘substitution account’ with the IMF. As a counterpart to this replacement, the Fund acquires a claim on the reserve centre. Substitution may be either voluntary or mandatory.

Funding usually means the replacement of liquid reserve currency claims by illiquid reserve currency claims (possibly in the form of long-term loans), in a bilateral deal between the reserve holder and the reserve centre. (Funding could presumably also be arranged multilaterally.)


Numeraire’. Gold is the numeraire of the Bretton Woods System in that it has been the major reserve asset and the unit of account or standard in terms of which par values are expressed in the IMF. The value of the SDR is defined as 0.888671 gram of fine gold and the value of the IMF’s assets is maintained in terms of gold.

The ‘two-tier market’ was introduced in March 1968 when it became impossible to continue to depress the private market price of gold to the official price level. The arrangement provided for private transactions in gold to take place at the prevailing free market-determined price, while all official gold transactions were to take place at an officially-determined price, equal to the gold parity of the currency concerned.

Special Drawing Rights (SDR)

The Special Drawing Rights facility was established in 1969 to meet the need, as and when it arose, for a supplement to the volume of official international reserves. SDR are internationally-created reserve assets whose value is guaranteed in terms of gold. Allocations of SDR are made to participants in the scheme according to their IMF quotas (subscriptions) which broadly reflect relative economic size. The system of designation ensures that participants with a balance of payments need to use SDR may do so and obtain promptly full value in convertible currency (for this purpose United States dollars, pounds sterling or French francs). In accordance with established procedures, the Fund designates a participant with a strong balance of payments and reserve position to provide convertible currency in exchange for SDR. Net receipts of SDR attract interest at1½ per cent per annum. The obligation to accept SDR is limited for each participant to twice the net amount allocated to it.

The whole complex of rules regarding the SDR may be modified within the existing Articles of Agreement of the Fund or by amendment of the Articles which requires the support of 80 per cent of the voting power.

The’ link’ encompasses a number of possible approaches to providing additional financial resources to some or all developing countries via a link with the process of creating international liquidity in the form of SDR. This might be done bilaterally, between developed and developing countries, or multilaterally perhaps through development financing institutions (e.g. the World Bank, regional banks).


– Motivation Three motives can be usefully distinguished, conceptually, for international capital flows: long term investment in another country; interest arbitrage designed to maximise interest earnings on liquid funds; speculation on exchange rates. In practice these motives may co-exist. - Leads and Lags Short-term capital transfers can often be effected, despite exchange controls, by the practice of accelerating or delaying payments (‘leads’ and ‘lags’ respectively) associated with international trade. This is effectively an extension of short term credit and shows up in the capital account of the balance of payments under the ‘balancing item’. - Covered Interest Differential Short term interestsensitive capital flows will often be ‘covered’ in the forward exchange market to protect currency holders against exchange risk. The covered interest differential is the difference between the interest rates in the 2 countries concerned, adjusted by the difference between the spot and forward exchange rates. It is an index of the incentive for funds to move between markets provided that strong speculative views are not held about future currency values. - Disequilibrating flows Capital movements may be equilibrating’ where they finance temporary fluctuations elsewhere in the balance of payments. Capital flows are ‘disequilibrating’ where they aggravate fluctuations in the balance of payments. - Treatment of Capital Flows The volume of capital flows can be ‘influenced’ by the imposition of direct controls or interest rate or other measures. Alternatively, the effects of capitalflows may be offset’, domestically by the use of monetary policy and externally by financing them either with international reserve holdings or with swaps and other international credit arrangements:

  1. Forward Intervention The central bank may enter the forward exchange market with the aim of altering the differential between the spot and forward exchange rates so as to affect the covered interest differential and hence discourage interest-sensitive capital flows. This ‘forward intervention’ has proved unsuccessful against speculative flows.
  2. Harmonisation of Monetary Policies If national monetary policies were harmonised, countries would cease to use monetary policy for purely domestic purposes and would either maintain a neutral position vis-a-vis the world level of interest rates or in certain cases actively use monetary policy to help achieve balance of payments objectives.
  3. Swaps When currency loans are made to a deficit country to help it defend its exchange rate, it is usual for the deficit country simultaneously to lend an equivalent amount of its own currency to the other country - hence swap’. (The term is also applied where a central bank sells foreign currency to a commercial bank and at the same time enters into a forward contract to repurchase the foreign currency at a specified future date). The debtor acquires a short-term obligation which is denominated in the currency of the creditor.

– I present the following paper:

International Monetary System - Ministerial Statement, 12th April 1973.– and move:

That the House take note of the paper.

Leader of the Opposition · Bruce

– by leave - Before the question is put on the motion that the House take note of the paper, I take this opportunity to make a brief statement. The Treasurer (Mr Crean) last night very courteously provided me with a copy of this statement. He properly recognises the great significance in national terms of what is described in the statement. I agree with the course he has followed, but because it is of such importance I do not want to reply to the statement immediately. I should like the matter to be adjourned so that it may be debated properly and adequately. I ask the Treasurer for his assurance that the matter will be debated and not left at the bottom of the notice paper. My suggestion is that the Thursday afternoon of the next sitting week would be an appropriate time for the matter to be debated.

Mr Crean:

– I assure the Leader of the Opposition that an opportunity will be afforded for the matter to be debated.

Debate (on motion by Mr Snedden) adjourned.

page 1411


Ministerial Statement

Minister for Minerals and Energy · Cunningham · ALP

– by leave - In his policy speech last November, the Prime Minister (Mr Whitlam) said that the Australian Labor Party was determined that the Australian people should be restored to their rightful place in their own country, as the owners and keepers of the national estate and the nation’s resources, and as fair and equal sharers in the national wealth. The Federal ALP policy adopted at the Launceston conference in 1971, which I have followed throughout in my administration, provides for a comprehensive development, under Government control, of Australia’s mineral resources, with emphasis on the need for discovery of new deposits and direct Commonwealth and State participation in oil and mineral search and exploitation throughout Australia’s land and off-shore territories. It specifies that there shall be at least a majority Australian control over both equity and policy in resources development, and that we will devise and implement an integrated and co-ordinated national fuel and energy policy. In particular, we will regulate exploration, development, transportation, marketing and use of oil, natural gas and all related hydrocarbons. We will also prevent the pollution of the ecology and the environment by fuel extraction.

Petroleum, which is a finite mineral resource, is being consumed at an ever increasing rate in modern industrial society. Alternatives are available, but the implications of their extra cost will have serious repercussions on the economic and social pattern of our society. The world availability of petroleum and natural gas as prime sources of energy after a few decades is questionable. In Australia, fortunately, we are able to profit by the technology, the errors and the example of other nations. There is a need in Australia for a fuel and energy budget, providing annually for the most efficient utilisation of our finite resources and for these to be subject to the same careful calculation as the annual financial budget. With our various resources, there is a need for an ‘energy-mix’ related to the highly variable needs of our respective States.

Obtaining adequate, dependable and low cost supplies of fuel and energy is becoming the basic objective of major industrial nations. Just as it has been stated that war is much too serious a matter for generals to control, so a Labor Government says that exclusive control of Australia’s fuel and energy resources is much too serious to be left to individual companies, whose present status flows from the absence of a true national fuel and energy policy.

In the Launceston policy there is provision for a national fuel and energy authority. Obviously in Australia there are various existing authorities, such as the Snowy Mountains Hydro-electric Authority, the Joint Coal Board, and the Australian Atomic Energy Commission, which would have representation on such an authority. The National Pipeline Authority, now in the process of establishment, would have similar representation.

In the field of petroleum search, production, transport and refining, there is an obvious need for a national petroleum and minerals authority which would also be. a constituent part of a national body. In on-shore petroleum exploration, excepting in the Northern Territory, there is only limited Commonwealth influence, as the common code of each State governs internal exploration and exploitation. Here, therefore, the development of a co-ordinated national policy is heavily dependent on the closest Commonwealth-State cooperation. In off-shore petroleum exploration, there is undoubted Commonwealth sovereignty, and I will be asking Government approval for appropriate legislation for the establishment of a national petroleum and mineral authority at an early date. Such an authority would explore, produce, transport and refine petroleum. It would act by: Employing its own personnel and equipment in search; letting out contracts for search; acting in partnership with companies; in appropriate cases, taking up shares in companies; accepting ‘farm-ins’ to attractive areas; and granting ‘farm-outs’ from areas it held in its own right. Such an authority could act with great flexibility to deal with specific situations. It would act in concert with the Bureau of Mineral Resources which, I would remind honourable members, was first established by the former Chifley Government, having as one of its functions to explore for petroleum.

In the formulation of an annual energy budget, the authorities to which I have referred would all make their contributions with advice and statistics based on their individual experience and data obtained from private company sources. Variations in technology from year to year would alter the weighting of the various resource uses, and in this regard, the research work of a special division to be established to deal with the scientific aspects of energy production and sources would be of vital importance. I refer here, of course, to such matters as solar energy.

It is necessary also to correct current impressions and propaganda relative to the source of total expenditure on petroleum exploration in Australia. To the end of 1971, $843m had been so expended. Of this, $174m has come from oil search subsidy payments by the Federal Government and by other forms of State and Federal government expenditure. But the cost to revenue of taxation concessions to the petroleum industry has not hitherto been published. The estimated cost of the concessions to shareholders under Sections 77a, 77d, 77c and 78 of the Income Tax Assessment Act in respect of the contribution of share capital to petroleum exploration and petroleum mining companies, for the period 1958 to 1971, is $110m. The estimated cost of past and future tax exempt dividends, payable by companies which are currently producing petroleum, following expenditures already incurred, is an additional $43m. The estimated cost of the special deductions allowed in the period 1966 to 1971, and of the entitlement to future deductions for capital expenditure on exploration by companies which have discovered petroleum is $92m. Thus the total to date of taxation concessions granted or available is $245m. Moreover, these figures do not take into account the cost of potential deductions available to those companies which are not yet producing petroleum and natural gas, but will undoubtedly do so. In aggregate, the contribution of public revenue to oil and natural gas exploration to date will be $4 19m - approximately 50 per cent - with more yet to be claimed when companies such as WoodsideBurmah Oil NL enter into production.

This is a vastly different picture to that presented by the propagandists for the petroleum lobby. With such a huge public contribution, it is staggering to note that no equity has been sought by our predecessors in office in crude oil and natural gas production. It would be impossible to accurately evaluate the assistance given by way of free information from the Bureau of Mineral Resources, to the various exploration companies. Here again, this has been done without thought of granting Commonwealth equity participation equivalent to such aid.

There is a growing awareness of a world energy crisis, and major industrial nations such as Japan and the United States of America, having depleted seriously their available resources, and being already heavily dependent on imports, particularly of crude oil, are now turning to ‘resources diplomacy’ to provide for their future needs. They are proposing a pooling of free world energy resources, with a uniform pricing structure. In opposition to them are such organisations as the Organisation of Petroleum Exporting Countries, whose reasoning is that oil is the ultimate ‘hedge’ in a world trading system that is adrift for want of a standard of value. The countries in this group say that it is better to hold ‘black gold’ in one’s own ground than green paper in someone else’s, and that, in these circumstances, it may no longer be in a nation’s interest to maximise production of an exhaustible resource, which may be its only counter at the diplomatic game table.

In Opposition, Labor strongly opposed the Petroleum (Submerged Lands) legislation. We said then, and have maintained continuously, that it was wrong in principle and form, and a: sacrifice of the- natural assets of Australia. If vindication were needed, it has been provided by the Senate Committee, appointed under the former Government to inquire into its own legislation. That Committee found that the constitutional concepts underlying the legislation were inconsistent with what should be the proper constitutional relationship between the Parliament and executive.

The position of off-shore petroleum exploration today fully vindicates our vehement criticism. The Australian continental shelf, of li million square miles, is the world’s largest. Exploration under current permits relate to excessively large areas, which are being explored on a non-intensive - and I stress the word ‘non-intensive’ - basis. With the alleged dichotomy of constitutional powers, there is a lack of effective supervision and co-operation. There also is inadequate definition and protection of the national economic interest. The reserved royalties are ludicrous, and the ultimate revenue yield is inadequate.

In its present form the Petroleum (Submerged Lands) Act can permit the complete depletion of our off-shore resources within a 21 -year period. Some of the world’s major international oil companies - there is no need for me to name them - are scuffling with each other to participate in farm-out arrangements with such an objective. We have yet to discover adequate reserves of crude oil. We still import between 28 per cent and 30 per cent of our total petroleum needs. Worse still, natural gas condensate and liquid petroleum gas, capable of being reconstructed into super premium motor spirit, are being exported. There are serious anomalies in the refining and transport of petroleum.

The Bureau of Mineral Resources estimates that some 70 per cent of off-shore exploration interests are held by overseas companies. There are 3 oil rigs only in the north west shelf, with an area of 140,000 square miles, held under exploration permits by the WoodsideBurmah group. In the North Sea, with a comparable area, some 40 such rigs are operating. Australian seismic search is at its lowest ebb since 1965. There are defective development procedures in use, and the offshore field development pattern is completely inadequate.

In return for an exploration expenditure of about $843m, the greater part of which has been and will continue to be, borne by the Commonwealth Government, there has been already discovered by exploration in Australia, on-shore and off-shore, some 45 trillion cubic feet of natural gas, over 2 billion barrels of crude oil, which together with condensate and liquid petroleum gas have a gross value of over $14 billion. That is taking natural gas at the on-shore gate valve or well head notional value of 20c per thousand cubic feet - a conservative valuation. In the light of future discovery prospects, particularly on the north west shelf, there has already been a remarkably high rate of potential return on exploration outlay.

The owners and keepers of the national estate and the nation’s resources are the Australian people, and their Government. We are particularly concerned that hitherto no consideration has been given by a company, holding exploration areas beyond its testing potential, as to whether the Commonwealth itself would be interested in their development. It is of paramount importance that Australia should develop and maintain local petroleum expertise, and a research capacity in all aspects of exploration, drilling and recovery of land, and in shallow and deep water alike. I present the following paper:

Federal Petroleum Search Policy - Ministerial Statement, 12th April 1973. and move:

That the House take note of the paper.


– This is a major policy statement which has been made by the Minister for Minerals and Energy (Mr Connor). I should think that he has been preparing it for some months. It was first seen by me this morning. I am not complaining about that, because we had 2 hours notice, but it is not easy for an Opposition spokesman looking at a major policy statement such as this to comprehend everything that is included in it, and, of course, one has no opportunity of referring it to the executive of the Liberal Party. Having said that, I am anxious to take the earliest opportunity to comment on some of the matters which the Minister has raised in his statement. The first point, of course, is that he acknowledges what has been acknowledged by the Prime Minister (Mr Whitlam), namely the outside control under which the Government functions. This confirms the statement of the Prime Minister that he is obliged in Government to act in conformity with the decisions made at the Australian Labor Party Conference held in Launceston in 1971. This brings us back to the whole question of who runs the Labor Party or who runs the Government when

Labor is in office. It is not run by Cabinet; it is run by the Australian Labor Party’s Federal Conference which met 2 years ago. It is interesting - obviously this is getting under the skin of Opposition members - to look at the composition of this Conference to find out just how its policies are made. When the Opposition was in government, policies were made by Cabinet as a result of information papers which were presented to it by departments which are expert in this field, particularly the Department of National Development, the Bureau of Mineral Resources, and the Department of the Treasury, and chewed over. But the Labor Party made its policies at the Launceston conference and, no doubt, will do the same at the new conference which is soon to be held in Surfers Paradise.

The meat of the statement can be divided into 2 parts. The first is that this is an obvious implementation of the Labor Party’s socialisation pledge. The second is that the Labor Party is using new words to dress up, as part of a public relations campaign, actions which were being undertaken by the previous Government. The Labor Party is using these magnificent new words - ‘energy budget’ and authorities’ to replace ‘the Minister’ and ‘the Department’. Here we have the perfect socialist state. The Minister for Labour (Mr Clyde Cameron) was attempting to laugh as if there was not a socialist objective in the Labor Party. Let me, in case he has forgotten, read it out and read out also the pledge that he signed. This is what the Minister for Labour (Mr Clyde Cameron) and the Minister for Minerals and Energy signed in earlier days:

I also pledge myself to actively support and defend at all times the Party’s objective - the socialisation of industry, production, distribution and exchange.

Of course they have changed this.

Mr Clyde Cameron:

– Hear, hear!


– I am glad to know that this is supported by the Minister for Labour. The Labor Party’s objective now is democratic socialisation. It was changed a bit because it was thought that this was somewhat unpopular so the Labor Party now calls it democratic socialisation’ - whatever that might mean. I do not see what democratic means in this context - the democratic socialisation of industry, production, distribution and exchange.

Mr Keating:

Mr Deputy Speaker, is this a debate on the constitution of the Australian

Labor Party or a debate on the Minister’s statement relating to a petroleum search policy?


– I am hoping that the honourable member for Farrer will soon get back to the statement.


– I certainly will. I hope to show how this statement is putting into operation the socialist platform of the Party. The Minister says:

  1. . we will regulate exploration, development, transportation, marketing and use of oil, natural gas and all related hydro-carbons.

One could not get a more perfect socialist state. The statement continues:

Such an Authority would explore, produce, transport and refine petroleum.

Call it ‘nationalisation’ and ‘socialisation’, it means the replacement of private industry by state-operated industry. This is something to which the Opposition is strongly opposed. I mentioned the use of new words for this glossed up policy - words such as ‘energy budget’. I do not have the faintest idea what an energy budget is meant to mean, but it sounds very good. I am sure our modest member could write a thesis on just what energy budget’ is meant to mean.

Apart from the new words used, let us look at the policy which was implemented by the previous Government and which was an extremely successful energy policy. It was our policy, when in government, to assist in the discovery, assessment and development of fuel and energy resources. We did this in a number of ways, all of which were extremely successful. First, through the Bureau of Mineral Resources and the Joint Coal Board there was mapping, measurement and assessment of our coal resources. Honourable members know, if they have read of the national development output in this field, that we now have proven resources of recoverable black coal of about 13,000 million tons and recoverable brown coal of about 10,000 million tons. There has been considerable exploration, particularly in Queensland but in other areas as well. There is no doubt that there is potential for proving additional reserves well above those of which we already know. The previous Government assisted in the development of hydro-electric power resources in Australia. It did this both with the Snowy Mountains Hydro-Electric Authority and in Tasmania where it gave financial assistance to that State. It encouraged the search for uranium and the production of uranium.

The revised policy which I introduced when I was a Minister in 1967, led to a very considerable increase in the discovery of uranium. This was because it made it permissible for people who discovered new deposits to export a small percentage of those deposits provided, of course, it complied with all the requirements. The Minister still had to agree to the exportation, it had to be exported under safeguards and there had to be adequate availability of uranium in Australia. Provided this all happened, people had the right to export a percentage of a new discovery. This has led to the discovery of proven reserves in Australia which at present total more than 100,000 tons and probably reserves of more than double that quantity. In fact, some contracts had been written, but I understand they have been frozen by the present Government. There was also the development of techniques in atomic energy. Here again, when the Opposition was in government it set up the Atomic Energy Commission which has done a tremendous amount to develop an understanding of atomic energy in Australia. That is a first class organisation. In fact, when we were in government we had gone as far as to plan a generator at Jervis Bay but, unfortunately, when the costs were looked at it was discovered that this would be more expensive than had been anticipated and so the project was suspended. I hope that in the not too distant future Australia will have its first generator, making nuclear power from uranium. I am sure that this will be a great advantage to Australia in helping to produce energy, so saving some of our other resources.

Of course, the previous Government was responsible for proving large deposits of oil and gas. It is noteworthy, of course, that before we came into government in 1949 the Ampol company had been trying to interest an American company in coming to Australia. The American company showed some interest but the moment that it was proposed that Australian banks should be nationalised it immediately threw the proposal aside and said: ‘We have been nationalised in one or two other places in the world and we are not prepared to be nationalised in Australia’. It was not until 1953 that Ampol succeeded in getting to Australia an American company, and between the 2 of them they discovered Rough Range. This was a very small deposit and although it led to a boom at the time there was no follow-up. So the search for oil went downhill. The then Government said: We must do everything we possibly can to encourage people to search for oil.’ It introduced subsidies and taxation concessions. The Minister in his statement pours cold water on the concessions and says that the Government is paying for some of these things. But what would have happened if we had not paid? It was obvious that the search for oil in Australia was drying up and would not have been carried on. We would not have the oil we have today or the conditions under which we are now able to supply more than 60 per cent of our own requirements from crude oil and to supply 4 of the major cities of the Commonwealth with natural gas. Shortly we will be able to supply a fifth major city.

Again we have not allowed these facilities to be exported. The only exports in this area have been of liquefied petroleum gas which has been produced as a result of the drawing off of natural gas. This has earned funds for us overseas. Eventually one can see some of it being used in Australia. I have been talking about the energy policy of the previous Government. I want to stress that under our policy we realised that while we had to do everything possible to assist in the discovery, assessment and development of fuel and energy resources, the final choice of the fuel was in the hands of the authorities - the State Electricity Commission in Victoria or equivalent authorities in the other States. We have to realise that these people will make the choice of fuel which suits them best.

It does not matter if the honourable member for Hunter (Mr James) wants them to use black coal. They will say: ‘We have used that once already. We were held to ransom by the New South Wales miners. We will use brown coal’. They will continue to do that, so that it is not possible to have what is loosely called an energy budget or an energy and fuel policy while users have the undoubted right to select the fuel which serves them best. The Minister acknowledges this because he has said the fuel policy is heavily dependent on the closest co-operation between the Commonwealth and the States. The basic difference between the present Government and the previous government in respect of an energy policy is that we believe in private enterprise assisted by the Commonwealth or by the Commonwealth and the States where it is necessary.

The present Government believes in a staterun organisation going right through from exploration. It is even trying to turn the Bureau of Mineral Resources into something which it has never been before so that it can drill for oil. The Government wants transportation in its Commonwealth-owned pipes. It will even have refineries.

Mr Clyde Cameron:

– Hear, hear!


– I am glad to have confirmation that that is what the Labor Party stands for. I do not stand for that. I believe that private enterprise, where it is available, ready and willing to undertake a job, does it better. It also uses funds which do not have to be diverted from the taxpayers. Therefore the taxpayers’ funds are available in other areas in which funds cannot be drawn from private enterprise.

Mr James:

– You have a lot of investors in the Liberal Party.


– There are a lot of investors in Australia and I can assure the honourable member that they are not all in the Liberal Party. The difference is that we believe in private enterprise, the Government believes in a state-run show. We believe in overseas assistance where it is necessary in capital and techniques. Of course, the Government does not believe in capital assistance from overseas and has done everything it can to block it. We believe in close co-operation with the States; the Government believes mainly in the mailed fist approach, although it realises that that cannot always work.

The Minister goes on in his statement to complain that the Commonwealth has provided some of the oil search funds, an amount he estimates at $245m. I repeat: Where would we be without those funds? He claims that the funds have been put in but there has been no equity. I am interested to read in the Minister’s statement that the authority he is planning to set up is to explore, produce, transport and refine petroleum. It will employ its own personnel and equipment (Extension of time granted.) I thank the House for the extension of time. The authority is to employ its own personnel and equipment in search. Is there any need for that? I appreciate that one or two countries in the world have their own search organisations but I do not believe it is necessary here because there are a number of Australian-controlled and operated companies which carry out search. The authority will let out contracts for search. These contracts are let out now. When we make available a licence or a permit to explore there is a work requirement. There are relinquishment requirements. So much money must be put into the work. Returns must be furnished and areas must be relinquished which are then available at a later stage to others. It is even planned to take up shares in companies. I must say that that horrifies me. I do not know how it will be done. I have no doubt that Normie Foster, the Minister’s friend, will be put on the board of some of these companies to give them the advantage of his great brain in this area.

Mr Connor:

– He will stir them up.


– He may stir us up but he will not stir up any oil. Farm-ins and farm-outs are to be granted, but all this is doing is putting up the ante because we already have a system under which considerable amounts are taken by the Government. It is interesting to look at this take because the Minister said that on a list he. had looked at we were number 49 out of 50 countries in order of government take. I would like to learn how he arrived at that figure. The Senate Select Committee on Off-Shore Petroleum Resources produced an authoritative report. In relation to the Government take as a percentage of the divisible profit, information was provided by Mr Abbott, who was then Chairman of the Australian Petroleum Exploration Association, an organisation which the Minister would not meet last week. I am sorry that he did not, because I would have had an enjoyable lunch if he had agreed to go there.

Mr Connor:

– I will make my statements on major policy matters in the House.


– But you can still meet an organisation to discuss matters.

Mr Connor:

– After the statement is made here is the appropriate time, and not before.


– The Government take as a percentage of the divisible profit in the United Kingdom is 50.4 per cent; Denmark 45.8 per cent; Germany 50.6 per cent; Norway 55.2 per cent; France 47.72 per cent; the Unittd States 46.8 per cent; and Australia 52.8 per cent. In other words, according to the table we were the second highest. Mr McMahon, who was Treasurer at the time,, said that he could not accept the figures in their entirety because of the great difficulty in assuming what could be written off in the way of income tax deductions. I agree with him. But we know that in other parts of the world - for example in the United States of America - there are certain ways in which oil companies write things off which we do not have in Australia.

Mr Keating:

– What a shame!


– I am referring to the depletion allowance in the United States. It was pressed for strongly here and resisted by the previous Government because we wanted to retain a high take. I come now to one or two other points in the statement. The Minister said that Labor strongly opposed the Petroleum (Submerged Lands) Legislation when it was in Opposition. But it is interesting to know that at least 2 Labor governments, that of Mr Reece in Tasmania and that of Mr Dunstan in South Australia, agreed with it so there cannot be that much wrong with it. Secondly, the Minister said that the Australian continental shelf of 1,250,000 square miles is the world’s largest. I think whoever prepared that information for him ought to take a second look at it, because the largest continental shelf is Russia’s, Canada’s is second, the United States of America’s is third and Australia is very slightly behind the United States. The Minister said that this vast shelf is beng explored on a non-intensive basis. I repeat again that there are work requirements. These have been set, and in most cases - I think in almost all cases - they have been exceeded. There are relinquishments so that people cannot indefinitely sit by and sit on a prospective area. They must undertake this work requirement or relinquish the permit, and they have a legal necessity to relinquish certain areas as they go.

The Minister complains that only 3 rigs are drilling on the North West Shelf but there are 40 rigs drilling in the European area. First of all, of course, there is enormous demand for fuel in Europe and that is one of the reasons why it is a more sought after area if oil can be discovered there. The other point is one on which I now find myself substantially in agreement with the previous shadow Minister for National Development. I suppose he could be called my predecessor as shadow Minister for National Development, the honourable member for Dawson (Dr Patterson). He said: there is an urgent and justifiable need substantially to increase the exploration subsidy, particularly to Australian companies.

He went on to state:

One of the principal reasons for the reduction in oil exploration activity is the Government’s absurd policy -

This was our Government, of course, at the time - with respect to the guaranteed price for domestic indigenous crude oil. The domestic price for indigenous crude oil is pegged at the import parity price prevailing as at October 1968. This price is supposed to apply to 1975. When this price was first pegged the import parity price of crude oil was significantly lower than the Australian guaranteed price. This gave the industry a decided incentive to explore for oil. But early in 1971 there were substantial increases in world prices, to the degree that producers of Australian oil are now receiving prices around 20 per cent below the real import parity price. Thus despite severe inflation which has played havoc with exploration and development costs, the Government refuses to increase the price of Australian oil to _ at least equivalent to the non-dumped import parity price.

So those are the views of the present Minister for Northern Development. I hope they are also the views of the Minister for Minerals and Energy and I hope he will implement them and we will see an increase in the search for oil in Australia.


– The statement of the Minister for Minerals and Energy (Mr Connor) clearly sets out the Government’s policy, and I believe that it may be summarised as follows: Firstly, a majority Australian control over both equity and policy of our resources development; secondly, the coordination of a national fuel and energy policy; thirdly, regulated exploration, development, transportation and marketing of oil, natural gas or related hydrocarbons; fourthly, recognition that petroleum is a finite mineral resource; fifthly, the need for a fuel and energy budget; sixthly, recognition that adequate dependable low cost supplies are crucial to this nation’s progress and security; and seventhly, the imperative need to recognise that control of and responsibility for our national fuel and energy resources must be exercised by a national government and not left to the whim of private individuals or companies whose basic motivating force is private profit and gain.

Might I at this juncture make 2 comparatively crucial assessments to which the previous Government refused to face up. One is the overt pressure and power being exercised by multi-national corporations on national governments or sovereign States, and the second is the world energy crisis. In my humble opinion these 2 basic assessments will prove the most formidable problems that will face national governments in the very near future. What is the position facing this country at the moment in terms of its reserves and in terms of its control? Just how crucial is it to have a totally balanced evaluation of fuel and energy resources? Australian and world demand, current and projected, clearly indicates ominous signs of a world fuel crisis. Throughout the leading petroleum consuming countries consumption of energy has been growing at from 3 to 5 times the rate of population increase. What is Australia’s position insofar as oil is concerned? I have said this previously and I will repeat it: On present known reserves, by the year 1983-84 we will be producing 50 million barrels per annum. We will consume some 410 million barrels per annum. In effect we will have one-eighth of our requirements by way of known reserves. Based on the world parity price of $2.60 a barrel at 350 million barrels c.i.f., this would mean an annual cost burden to this nation of $1.5 billion. In relation to the question of Australian governmental expenditure and private finance, I seek leave to have incorporated in Hansard a table which clearly sets out that Government expenditure plus Australian private funds as a proportion of the total funds for petroleum exploration, development and production in 1971 constituted 58 per cent.


– Is leave granted? There being no objection, leave is granted. (The document read as follows) -


– Let me turn to the question of natural gas. Reserves have been estimated at between 70 trillion and 100 trillion cubic feet. Let me turn to the crucial question of equity participation and control. I shall deal today only with the 2 basic areas - Palm Valley and the northwest shelf. Palm Valley has an estimated 10 trillion cubic feet. Let us have a look at who controls this. Magellan Petroleum Australia has 43.33 per cent, Magellan Petroleum (United States) 13.54 per cent, United Canso Oil Ltd (Canada) 24.38 per cent, Freeport of Australia Incorporated (United States) and Flinders Petroleum NL 9.375 per cent each. In turn, Magellan Australia is owned 54.1 per cent by Magellan Petroleum Corporation of the United States, 21.1 per cent by Partepec International Incorporated of Bermuda and the balance by the Australian public. This is the company which in fact has signed an agreement with Pacific Lighting Corporation of Los Angeles to supply and export 500 million cubic feet a day to the western seaboard of the United States, subject of course to the Australian Government’s approval to export liquefied natural gas from Palm Valley. In my view it is a deplorable situation that this field is almost totally controlled by overseas multi-national corporations.

I turn to the northwest shelf. WoodsideBurmah, together with British Petroleum, Shell and California Asiatic holds leases totalling some 143,000 square miles. It is beyond question - and I disagree with the previous speaker - the largest gas off-shore provinces in the world, an area larger than the British Isles or the British sector of the North Sea or the entire concessions in the Gulf of Mexico. Just how is this vast hydrocarbon basin carved up. It reads like a ‘Who’s Who’ of the multi-national corporations. WoodsideBurmah is 54.5 per cent owned by Burmah Oil of London. The remaining interest is held by Shell, British Petroleum and California Asiatic with 161 per cent interest each. I am firmly of the opinion that the resignation of Mr Withers, formerly Managing Director of Woodside-Burmah, on 20th October last stemmed directly from a bitter division over the need to disclose the estimated northwest shelf natural gas reserves. It is a fact that he is one of the 5 who, out of the 9 members who constitute the Woodside-Burmah Board, are Burmah supporters. They have deliberately refused to reveal the current estimated reserves.

I am further convinced that the northwest shelf reserves are immense. My guestimate is that they are between 60 trillion and 100 trillion cubic feet gross. However a minority faction, and Mr Withers was one of them, was conscious of this simple fact that WoodsideBurmah shares had declined significantly already on the stock exchanges. As a consequence they were passing rapidly from Australian ownership at a low or depressed price. I want to quote from the Kit Kat Aitken report which was the only report I could find up to October last year which had made a balanced evaluation of the northwest shelf. This is what the report had to say.

We only gave our forecast below for the sake of interest and to demonstrate that, even with the information available, the operation appears fully viable and the shares substantially undervalued.

The consequence of the deliberate and calculated overt pressure applied by overseas interests is blatantly obvious as a tactic. It is a fact that Woodside-Burmah shares had declined and had been swallowed up by nominee share transactions to a level where overseas control on the northwest shelf is now estimated to be 87.7 per cent. In effect Australian equity in that vast holding is 12.3 per cent. It is scandalous that the density of foreign control has been achieved by nominee share transactions about which the previous Government did nothing. But added to that, and to compound it, of the 20,500 square miles which was farmed in under an arrangement reached through the connivance of Woodside-Burmah-

Mr Viner:

– What do you mean ‘connivance’?


– It was up to Woodside Burmah to call for tenders. Out of the 9 companies that applied and were granted farm-out arrangements only one was an Australian corporation, Hermatite Petroleum Pty Ltd, a subsidiary of Broken Hill Pty Co. Ltd. Let us put the field in its proper perspective, as I understand it. I have noticed Press reports estimating that there are some 9,000 million barrels of crude and condensate on the northwest shelf. This would have a value of approximately $2.6 billion. However, the estimated 60 trillion cubic feet - my guesstimate - of natural gas is valued in national terms at $25 billion, twice the entire national budget. It would supply more than enough to support a major liquefied natural gas or methanol export project, presumably the export of methanol to the United States of America and liquefied natural gas to Japan. It would also supply the Pilbara steel and mineral development project and leave enough for general use elsewhere in this country. These assets which are the envy of the developed countries could not have been more effectively or efficiently plundered if this country were a vassal of a conquering foreign army. It is the result of the previous Government’s open gate and soft approach to multinational corporations.

Why has the density of foreign control become so high in these 2 areas? I can recall being scoffed at and ridiculed when I asserted last year that we could get to the stage of exporting liquefied natural gas and rather than getting 16c a thousand cubic feet, which is the gate price paid from Gidgealpa to Adelaide it could rise to as high at $1.25 a thousand cubic feet. We are fully conscious of the pressure which was placed by the multi-national corporations on the previous Government and on this Government over the granting of export licences whether to Japan or the United States. Already Shell receives 80c a thousand cubic feet for its gas from Brunei landed in Japan. It is estimated by reputable bodies in the United States that the United States will pay a price of between $1 and $1.25 a thousand cubic feet. Already the United States is paying between 95c and 98c a thousand cubic feet for Algerian gas landed on the eastern seaboard of the United States. It needs little imagination to assess the huge profits which would be taken out of this country by multi-national corporations had export licences been granted to either of the corporations operating at Palm Valley or the northwest shelf.

My Government’s policy is deliberately and constructively geared so that any profits obtained from this source will be exploited only on the basis that it is in the national interest and that any profit from such exploitation will be maximised at world parity prices and will be for the national good and not for the profits of individual companies or multi-national corporations.

Just how crucial is the need for national control and a balanced evaluation of our resources? The previous Government, in its usual slavish policy of following the dictates of the United States, was rapidly exploiting our resources - fuel and energy - on exactly the same lines as the United States and it would have been equally as disastrous to this country as it has been to the United States. Let me quote briefly from a report by the Chase Manhattan Bank which ought to bring home to the Opposition just now crucial the situation is in the United States. The Bank’s energy economics report stated:

The United States is not going to be able to afford to fill its energy gap requirements between now and 1985 completely by imports. It is now obvious that the United States is faced with a very serious situation in respect of energy supply. And unless positive corrective actions are taken immediately the problem will become critical.

If the United States is forced to import amounts of oil and gas necessary to meet its full requirements, the necessary outflow by 1985 is likely to be in excess of $30 billion a year, compared with about 34 billion at the present time.

In no sense would it be realistic to expect that the outflow of dollars would be offset by a corresponding inflow. The annual balance of payments deficit alone could be as much as $25 billion; a deficit the nation could not tolerate.

If one wants to put it in more cogent terms, the United States currently imports 23 per cent of its oil requirements. By 1982 it will be forced to import 50 per cent and by 1992, 75 per cent. If one takes the figures of $US4 a barrel and $US6 a barrel, by 1982 and 1992 the American people will be up for an annual cost burden of between$US16 billion and$US48 billion. I put it quite seriously to this House that the world wide fuel and energy crisis, the role which has been played by those countries which control these vast non-renewable resources, the role being played by the multi-national corporations and the effects which they have on national governments in Western Europe, Japan and the United States, are crucial to world stability and peace. I quote now an extract from a report recently handed down by the Institute of Strategic Studies. It said:

The world contains ‘proven reserves’ of crude oil estimated at about 90,000 million metric tons. Of this, over 50,000 million tons are in the area of the Middle East (which here includes North Africa). (Extension of time granted).

The report continues:

Middle East oil is cheap: the capital investment required to produce one barrel per day there has varied from $120 to $265, whereas North Sea costs have been estimated at $2,500 per b/d. The world now consumes approximately 2,500 million tons of oil a year. Of this, almost 1,000 million tons comes from the Middle East. Table 1 shows that while West European and Japanese dependence on Middle East oil is already very large, that of the United States is relatively insignificant. It has been estimated, however, that, with the growth of energy demand and the exhaustion of domestic natural gas reserves, the United States may require 1,100-1,200 million tons of oil in 1980 and 1,250-1,500 million tons in 1985, and that domestic production is unlikely to exceed 600 million tons in the former year or 720 million tons in the latter. In 1980, therefore, American oil imports might be some 550 million tons, possibly rising to over 700 million in 1985. The Middle East will presumably supply a high percentage of this, with cautious estimates of 1985 imports from that source ranging between 500 and 600 million tons. In that same year, Western Europe may require up to 1,100 million tons of imported oil and Japan up to 600 million tons, with the bulk of that also expected to come from the Middle East

This is the crucial part -

In order to satisfy demand, Middle Eastern production might have to rise from 972 million tons in 1971 to something like 2,500 million tons in 1985. In return, Middle Eastern governments would then be receiving an estimated annual income from oil exported to the United States, Western Europe and Japan alone of up to $40,000m a year, forcing them to become substantial partners in the international financial system. It would be unwise to assume that all these expectations will prove justified. Many are based on simple extrapolations of recent trends, and are vulnerable to the fluctuation of economic growth rates, the deliberate energy policies of governments, changes in the relative prices of primary energy sources and the unpredioted development of non-oil sources. Nevertheless, it is such projections which form the basis for current policy decision by producing and consuming countries and by the oil industry itself. That, in the crudest terms, is why the politics and economics of oil have become the most important issue in Middle Eastern affairs and in the future relationship between Middle Eastern oil-producing (and oil-transporting) countries and the large consuming markets of the developed world. The events of 1972 offered the clearest illustration yet of the pattern which is evolving.

The point I make is that Western Europe, Japan and the United States are becoming almost entirely reliant on the MiddleEast. Imagine an amount of $40 billion going to Middle Eastern countries. Once that amount starts to gravitate in the international markets of the world it will become a problem in terms of stability in international monetary markets. I mentioned the movement of the multi-national corporations. It is the movement of large volumes of money at this level gravitating through the international markets that is causing the instability. I vividly recall some 3 years ago the Labour Prime Minister of Great Britain claiming that the gnomes of Zurich had been responsible for the devaluation of sterling at that time when basically devaluation was caused by the multi-national corporations.

In summary, I think it is fundamentally crucial that this country should not be placed in an identical situation to that which now faces the United States. Its national fuel and energy policy has been left entirely to the dictates of the multi-national corporations which have no responsibility to the United States or to any other country. They are concerned only about machinating around the world and increasing their profits from one country to another. We should not be placed in that vulnerable situation. Japan is in such a situation at the moment and it has had to diversify from the Middle East. It wants rapport with China or Russia to get high grade coking coal and crude oil. Personally I am proud to support the Minister’s statement and our Government’s policy objectives. They are 23 years out of date. They ought to have been initiated after the Second World War because anybody who had studied this subject at all could have predicted that in regard to resources the world is rapidly developing polarisation of instability. I sincerely trust that in the years to come this polarisation will not take place. I hope that there will be international rationalisation of distribution of resources because if this is not achieved there will be conflicts and possibly war. My Government’s policies are constructively geared to regulate and control our vast non-renewable fuel and energy resources to ensure that such exploitation is in the national interest. This whole area of fuel and energy is the one basic area where beyond question control must be exercised in the national interest in terms of our future progress and security. That progress and security can only be safeguarded and protected by a national government. I commend the Minister and congratulate the Government for its positive policy and its timely initiative.

Leader of the Australian Country Party · Richmond

– I wish to speak to the statement that has been made in the House by the Minister for Minerals and Energy (Mr Connor). I believe this to be a major policy statement. It is regrettable that we have not had more time to examine it so that there could have been a more informed debate by honourable members on this side of the House and a closer examination of the impact and the consequences of the statement. This debate could have been adjourned but I think from the experiences of the last few weeks there would be great doubt in the minds of members of the Opposition as to whether the debate would ever come on again so that we would have an opportunity to speak on this matter. So I speak today to this statement which I see as highly significant. I see it as a blueprint towards nationalisation of the Australian petroleum and gas industry. I believe that stemming from this statement today we will see the encroachment of bureaucracy into this area of commerce in Australia. There is no mandate for the Government to move in this direction. There was no statement in the policy speech of the Australian Labor Party that there would be created a national petroleum and minerals authority which would have control over the exploration, assessment of resources, development, transportation and the refining of minerals or petroleum in this country.

We can see from this statement that the Labor Party is standing behind the resolutions of the 1971 ALP Federal Conference held in Launceston. Apparently every Australian now has to read the results of that Conference to determine what the Labor Party suggests it has a mandate to do. In other words, the people at that Conference - not the members of Parliament - determine the policies of the Australian Government. I see this emerging as the socialist instinct of the Labor Party. The Labor Party seems to regard big business as a bogy. If it is big, it is bad. If it is foreign business, it is twice as bad. The Labor Party is now launching its attack on the oil and gas industry in Australia. I see this as a very disastrous move for Australia. There will be. disaster because this move will create doubts and uncertainty in the minds of those people who are willing to invest their money in companies which carry out exploration to find the necessary energy resources that we will need to meet our demand during the balance of this decade. If the present rate of exploration is not maintained or indeed is not built up, we will have such a deficiency of petroleum in this country by 1978 that we will have to rely extremely heavily on imports of petroleum.

The action of the Government in announcing today that it is to move into these areas must create doubts and fears in the minds of the people who are already active in them. There are methods of controlling companies which operate in the areas of gas and petroleum in this country. There are Commonwealth laws and there are State laws. These laws initially extend from the granting of exploration leases right through into every phase including the control of the retail price of petroleum. But apparently this is not good enough for the Government. It intends to move into these areas in much greater depth. The Government has to become more and more involved. The history of oil exploration in this country has not been a very exciting one. Until the early 1950s it was the popular belief that there was no petroleum to be found in Australia. Many holes had been drilled over a period of half a century and all had proved to be dry. Geologists believed that

Australia was too ancient a country to produce oil, that the sedimentary basins were J ry. Not until the discovery of oil at Rough Range in 1954 was new life given to exploration programs in this country.

Why did that discovery take place? It took place because the Bureau of Mineral Resources had carried out an assessment of likely resources of petroleum in this country and had interested the Ampol Petroleum Co. Ltd in undertaking a drilling program. Ampol discovered that it did not have the necessary financial resources or the knowhow to become involved in this work, so Sir William Walkley travelled around the world and interested the California-Texas Corporation in forming WAPET. As a result of this effort, bringing in overseas risk capital and knowhow, Rough Range was discovered. This discovery also resulted in a decision by the then Government to give incentives by way of subsidies for oil drilling and taxation concessions to encourage people to invest in exploration. We needed to find oil to try to replace our heavy import requirements. But another discovery of oil was not made in this country until 1963 when oil was found at Moonie. A period of 9 years had gone by and a lot of people had despaired. During that time almost 100 holes were drilled, every one of which was dry and investors thought that they were wasting their money.

This discovery was closely followed up by a discovery on Barrow Island. But even the Barrow Island discovery required the drilling of 100 wells before that field could be declared economic. A sum of $100m - Si 00m of risk capital - went into proving that ground. This was the amount spent by an overseas company which had the knowhow that we did not have in this country. As a result of these 2 discoveries many many more companies were formed. We saw the establishment of Australian companies, joint Australian and overseas companies, and overseas companies. They came in and they spent money. It was not until the discovery of a substantial oil and gas field by Esso-BHP on the Gippsland shelf off the Gippsland coast that this exploration paid dividends.

It is worth looking at the discovery which took place on the Gippsland shelf because after the Broken Hill Pty Co. Ltd had carried out its original survey it realised that it did not have the capital - Australia’s biggest company did not have the sort of risk capital required - or the knowhow to be able to do the job. So representatives of the company went off round the world and talked to international oil companies to see which company would be interested in joining up with BHP. Eventually the Esso Company agreed to do this. It took almost 5 years after the discovery of this oil for the fields to be brought into production. During this time enormous amounts of money had to be spent. There were no other significant discoveries of oil or gas in this country after 1965 until 1971 when Woodside-Burmah discovered a large deposit of hydrocarbons basically in the form of gas on the north-west continental shelf. That company was offered a very substantial lease in that area when no one else was interested in taking up the options available. It drilled and found some smells of hydrocarbons. The company went on and spent $100m in drilling holes until it got a proven field. I heard the honourable member for Hawker (Mr Jacobi) talk as though this were one of the biggest fields in the world. The estimated size of the field is 20 trillion cubic feet of gas which is not big by world standards. Some of the fields in Siberia have an estimated capacity in excess of 200 trillion cubic feet. So let us not be extreme. Although the north-west continental shelf field is a significant and important field for Australia it is just one of the fields around the world.

The Government is now giving notice that it will move into these areas and that it will do the work and use public funds - the taxpayers money - to chase oil in this country. Let me assure the Government that even in those parts of the world where oil is known to be, where there are relatively proven areas, only one out of 12 holes proves to be successful. The Government will be getting into a very expensive business if it moves into the business of offshore drilling. Of the 5 rigs commissioned around Australia only 3 are operating at the moment. These three are being operated by Woodside-Burmah on the north west shelf. It costs $33,000 a day to operate each one of these rigs. The cost of operating the 3 rigs is $100,000 a day. Already this year the company has lost 30 days because of cyclones and strikes which means that a total of $3. 25m has been lost in unproductive time because of these factors. Yet this is the sort of business that the Government is talking about getting into. Apparently the Government gives this activity a greater priority than it gives to other areas of government responsibility that it should be attending to, such as social welfare and helping the needy in the community.

We have the chance of attracting overseas interests to this country who are prepared to come in and spend their risk capital and to try to develop our resources. But the Government is not satisfied. It wants to use Australia’s already important and strategic financial resources to spread its activities to all aspects of industry. Let us consider the cost of running the north-west shelf field where deposits of gas have been found. These deposits now need to be developed and it will cost from $300m to $400m over the next 5 years to make this field productive. To continue proving the fields over this period will require an expenditure by the company alone of $30m to $40m. Is this what the Government will do?

I mentioned earlier that I believe that the Government’s policy is a policy of disaster as far as meeting our energy requirements by the end of this decade is concerned. I say that, because if the Government frightens private industry and creates doubts as to the certainty of its investment in this country it will have to come in and replace that capital. The Government will require at least $100m for exploration each year on top of the funds needed for development purposes which, as I mentioned before, will run to $400m or $500m in the initial stages of the operation of the northwest shelf field alone. I believe that if this is to be the approach of the Government - this socialist Government - it is putting its priorities in the wrong place as far as the expenditure of public funds is concerned. So I have grave reservations about the statement made by the Minister today. I believe it to be a doctrinaire statement which illustrates the Government’s obsession to get into the private sector of the economy. The way the Government is carrying out its objectives is hamfisted, because from what I can find out already there has been no consultation at all between the Government and the people who understand the problems of the industry. The Government is just barging in with stand and deliver tactics on the industry because it has an obsession about big business, and big business is overseas business.

Debate (on motion by Mr Daly) adjourned.

page 1424


Bill presented by Mr Clyde Cameron, and read a first time.

Suspension of Standing Orders

Motion (by. Mr Daly) - by leave - agreed to:

That so much of the Standing Orders be suspended as would prevent the Minister for Labour from speaking without limitation of time when moving the second reading of the Bill.

Second Reading

Mr Clyde Cameron:

– I move:

That the Bill be now read a second time.

This Bill is the first stage of a radical transformation of industrial relations in Australia. Later stages of this transformation will involve an examination of all aspects of industrial relations in Australia by a special committee of inquiry to ensure that policies and procedures for handling labour relations will be suitable for our needs over the next decade or so. This will take us far beyond a mere examination of the law on conciliation and arbitration. I intend to divide this examination into 2 parts. The first will deal with the quality of work in Australia and the second - a much larger and longer inquiry - will make an in-depth study of the institutional framework of labour relations.

The committee will report on the need for constitutional reform including the delineation of Federal and State jurisdiction in labour relations and the limitations of Commonwealth power. It will examine the functioning of the conciliation and arbitration system including the workings of the Act, the desirability of experimenting with new forms of agreements like productivity agreements, whether there is any role for voluntary mediation or conciliation committees and what ground rules could be evolved for collective bargaining in Australia. It will examine the needs of .trade union and employer organisations in Australia, the need for amalgamations, for trade union education and for closer consultation between unions, employers and government.

It will examine plant level relationships, including the need for worker participation, the role of shop stewards and shop committees and the concept of works’ councils. It will examine wages and working conditions for employees in Australia, including wage concepts, the changing relationship between the poorly paid and the highly paid, the role of the national wage case and other cases setting national standards on matters such as hours, leave and equal pay. In all these studies the Government’s aim will be to create conditions for the achievement of social justice and industrial harmony. As honourable members know, the Australian Parliament has only limited authority to make laws to regulate labour relations. The Australian Constitution limits this Parliament’s jurisdiction to interstate industrial disputes. In the courts, by resort to fiction and technicality, a fairly wide ambit has been given to this phrase. There is a limit, however, beyond which plain words cannot be stretched even by the ingenuity of lawyers.

Constitutional Limitations

Labor believes that ultimately there will have to be an expansion of Commonwealth power in the field of industrial relations because, to quote from our Party’s platform, to allow the Commonwealth power to deal with industrial matters to remain in its present form is like expecting to control modern motor traffic with laws taken from the horse and buggy days’. It is the task of the national Parliament to create labour relations which meet and match the needs of the community and which will anticipate and overcome obstacles to justice and common sense in industrial relations.

However, the question of increased Commonwealth power is one we must postpone for later consideration. Our immediate aim is to give effect to those aspects of industrial policy which can be dealt with within the rather limited area of power granted by the Constitution. Therefore, this Bill will pass into law a number of proposals contained in the Prime Minister’s policy speech originating in the Australian Labor Parry’s Federal platform. In addition, this Bill will correct a number of defects arising from the set of amendments made by the former Government.

In 1904 the founders of compulsory arbitration in Australia embarked on a novel, and what must have then appeared to be, a rather bold social experiment. Many of the problems which have arisen in the past 70 years could not have been foreseen at the time of Federation. The next generation of Australians will look back on the experience of compulsory arbitration to this date as a necessary prelude to a more systematic solution of the problems of industrial relations and employment. On the whole, compulsory arbitration has served a useful purpose. The central position of power occupied by the tribunals, however, could never have been attained or maintained without popular approval and especially without the support of the trade union movement.

In recent years, however, many large employers as well as the great mass of union members have become impatient with the penal aspects of the federal system. As unions and employers become better organised, as their research facilities grow and as they become more aware of the advantages of negotiation and the disadvantages of remaining passive clients of an arbitration commission, so will the acceptability of the Commission’s penal powers diminish and the area of its influence as a arbitral body contract. Important industries are now becoming the scene of negotiated agreements. For some years now we have been witnessing a fundamental change in the work of the Commission. Increasingly the Commission relies upon procedures of negotiation and conciliation; less and less does it invoke its authority to arbitrate.

This Government will not abolish conciliation and arbitration; it will reconstruct it and strengthen it to eliminate features repugnant to harmony and good relations in industry and thus set it on a course not requiring constant correction by legislation as we have seen since 1949. The system has been jerry-built over the years. Indeed, the Act has been affected by no fewer than 29 separate amending Acts in the last 23 years of LiberalCountry Party government. Some of these were machinery matters such as judicial salaries, but some were major amendments such as the provision of strike penalties, the separation of judicial functions from the arbitral functions and the separation of conciliation processes from those of arbitration.

A Clear Mandate

As I said earlier, the Government has a clear mandate for the changes it intends to make. The Prime Minister (Mr Whitlam), in his policy speech, said that the strength of multi-national corporations in the Australian economy requires strong unions as well as strong government. He said that Labor would facilitate the amalgamation of trade unions. It would reduce government interference in industrial relations, put conciliation back into arbitration and abolish the penal clauses. The Prime Minister was speaking on the authority of the decisions of the 29th Commonwealth Conference of the Australian Labor Party held in Launceston in 1971. The program adopted at that Conference has been given the widest possible publicity. The Party’s policy statement has been circulated throughout the nation. In speeches I made as shadow Minister for Labour in the 18 months preceding the elections, in the Parliament and at seminars and conferences throughout the Commonwealth, I stated and explained our policies. Our intentions were fully discussed in the election campaign. We can, therefore, fairly claim to have a clear mandate for what is proposed in this Bill.

The Bill provides for a number of major changes. They are: The removal of existing barriers to trade union amalgamation; the protection of organisations and their members from civil actions for tort in connection with industrial disputes; the removal of the Commission’s authority to ban strikes and the removal of all penal sanctions upon strikers; procedures to ensure that certain types of agreement are acceptable to members of organisations affected by them; provision for democratic control of unions and the fullest participation by union members in the affairs of their organisations; provision to enable action to be taken for the recovery of wages at law within a period of 6 years instead of the 12 months’ limitation that now applies; the removal of the various defects which have been shown to exist in the 1972 legislation; elimination of the power to award costs in proceedings before the courts, the Registrar or the Commission; and provision to overcome some of the problems created by the Moore v. Doyle case.

Union Amalgamation

This Government rests upon the goodwill of the mass of ordinary working people, their wives and their families. It is determined to keep in proper check those gigantic forces of capital, privilege and power that penetrate the lives of the community at every point. Both the Government and the people need the organised strength of the working people gathered together in strong, effective and responsible trade unions. We plan, therefore, to encourage the amalgamation of trade unions. The trend to amalgamation has accelerated in the last few years. Honourable members will be interested to recall figures supplied by the Commonwealth Statistician through the then Minister for Labour and National Service regarding the size of trade unions in Australia at the end of December 1970. He reported that there were 305 separate trade unions in Australia. Of the 305 unions, 152 had less than 1,000 members; another 96 had between 1,000 and 5,000 members; 34 between 5,000 and 20,000; 19 between 20,000 and 50,000; and only 14 with a membership of over 50,000. In West Germany, with a population much larger than Australia - 61 million to be precise - there is a total of only 16 unions, one of which, the Metal Workers Union, has a total membership of 2,070,000.

Grave defects attend this dispersal of working people throughout such a large number of separate organisations. There is unnecessary duplication of work. Salaries paid to officials of great energy, dedication and talent are low and unattractive, and discourage men of quality from making the sacrifices that a career as a trade union official often involves. The population base from which the leaders are drawn is often small. Demarcation disputes concerned with protecting the revenue and membership of a union threatened with loss of coverage by encroachments of other unions are a common occurrence in this country. Too much time is lost through disputes over which unions should handle a certain job. The mobility of trade union officials from office to office is sometimes restricted by rules which require officials to be drawn from among longstanding union members only.

The cost of libraries and research staff - essential for good quality industrial leadership - is frequently beyond the resources of small unions. Even the cost of assembling the members and officials in conference is too much for some unions frequently to bear. Discussion and policy making in tune with the needs of the members always suffer when the members and their leaders cannot frequently consult each other. Employers and the organisations that represent them do not suffer these handicaps. They draw upon the whole workforce in industry, the Public Service and the universities for people to represent and uphold their industrial interests. They enjoy the rapid gathering and dissemination of information relevant to their cause.

Research staff, libraries and independent economic and legal advice are freely acquired whenever needed.

A strengthening of the resources of the working people in amalgamated trade unions which are possessed of strong, well-trained and well-equipped leaders will redress the present imbalance. Negotiation and conciliation will become more effective in resolving disputes as union leaders become better informed and better trained. We are, therefore, wholly in favour of amalgamation of unions of the working people. At the same time, we insist on democracy in the government of these larger groupings. I endorse what was said by the Deputy Leader of the Opposition (Mr Lynch) in Melbourne on 2nd March 1972. Speaking of amalgamation, he said:

It is fair to say that provided the membership of industrial organisations does not lose effective control as a result of amalgamations, there are many advantages which can accrue from amalgamation. For instance, there are some 300 unions in Australia. Most of them are very small. It could facilitate the functioning of the arbitration system and relations generally between employers and unions if this number of unions decreased. I know of situations in which employers have sat across the table withno fewer than15 unions in relation to one issue. Government Departments have had this experience.

Mr James:

– Who said that?

Mr Clyde Cameron:

– That was said by the present Deputy Leader of the Opposition last year in his capacity as Minister for Labour and National Service.

Mr Lynch:

– I rise on a point of order. I should like to help the Minister. I wonder whether you, Mr Deputy Speaker, would draw to the attention of the Government Whip that there are only 4 Labor members in the chamber listening to the Minister’s speech.

Mr DEPUTY SPEAKER (Mr Armitage)There is no substance in the point of order. It is not within the province of the Chair to do that any more than it would be for the Chair to draw attention to the fact that there are so few members of the Opposition in the House at the moment.

Mr Lynch:

– If I may say so, it is a Government Bill.


– Order! I call the Minister for Labour. (Quorum formed)

On that occasion, the Deputy Leader of the Opposition went on to say:

The question of whether there should be changes in the legislation to specify more clearly the procedures under which organisations can amalgamate in the future is one to which the Government is giving detailed consideration. We believe quite firmly that there should be proper membership control of the organisations consistent with their efficient management and operation.

The Government agrees with the ideas then expressed by the Deputy Leader of the Opposition. However, the legislation subsequently introduced by him did not facilitate the amalgamation of trade unions. Instead, it placed almost impossible procedural barriers in the way of amalgamations. It provided, for instance, for elaborate and complicated ballots more suited to defeat than to express the will of the membership. They were, in fact, intended to prevent amalgamations from taking place.

I know that these provisions were resisted by the Deputy Leader of the Opposition but they were forced on the government by the Democratic Labor Party. The Democratic Labor Party used every device at its disposal to thwart the amalgamation of the metal trade unions. That Party threatened to defeat all the amendments to the Conciliation and Arbitration Act unless the then Government capitulated to its opposition to amalgamation. The previous Government capitulated. The Liberal Party now has the chance to demonstrate that it is free of the shackles of the Democratic Labor Party. I would expect it now to support the very proper position previously taken by its present Deputy Leader on this issue.

The usefulness of the present provisions will be tested by the simple question - do they help or do they hinder the unification of the trade unions into more powerful institutions to represent and uphold the interests of the employees? For an amalgamation proposal now to be adopted by a union, it will be necessary merely for a majority of those voting to approve of the proposal. It will not any longer be necessary for 50 per cent of the enrolled membership to vote in an amalgamation ballot.

The defects of the existing system can be clearly demonstrated. For example, in an amalgamation ballot in which 51 per cent of the membership voted, and 51 per cent of those voting were in favour, the proposal would be carried even though only 26.01 per cent of the total membership voted in favour. Contrast this where 49 per cent voted and 90 per cent of the voters favoured amalgamation. Under the Liberal Government’s legislation this proposal would have been defeated even though 44 per cent of the total membership voted in favour. Clearly the proper approach is to give every member the opportunity to vote and require him to accept the verdict of those voting.

The Bill provides that the unions themselves will have the power to conduct amalgamation ballots. Amalgamation ballots will be conducted by the Commonwealth when requested by the unions concerned. The cost of such ballots will be borne by the Commonwealth. These ballots will not be open to challenge, although the Court will have power to investigate ballots conducted by the union itself. The existing provisions which exempt a large organisation from the requirement to hold a ballot when amalgamating with a small organisation have been simplified.

Actions for Tort

The Bill amends section 5 of the Act to provide protection to officials, or members of unions against discriminatory action within the employer’s establishment where the official or member has merely upheld the industrial interests of the employees, so long as the action he takes is within the limits of the authority given to him by the organisation. The Bill also provides protection for trade unions and their officials against actions for conspiracy or inducement of breach of contract founded on the events of an industrial dispute. I want to emphasise, however, that this protection will not extend to acts which cause death or physical injury to a person, physical damage to property or involves defamation, or to threats of such acts.

The provisions protecting union officials from tortuous actions stem basically from the Goverment’s belief that the right to strike is a fundamental right which every employee must have. Actions for tort founded on industrial disputes represent a direct negation of the right to strike. A strike by its very nature carries with it the threat that the employer will suffer some material loss. If an employer is to be permitted to recover at law any loss that he suffers from his employees then the right to strike becomes meaningless. Workers go on strike whatever the law may have to say about it. That is the clear experience throughout the whole history of the arbitration system in Australia and our experience is similar to what happens in other countries such as the United States, England and the other European nations.

The common law of conspiracy and the statutory prohibitions against strikes which flourished in the nineteenth century in England and America failed to suppress strikes. Pitt’s Combination Acts failed to suppress trade unions. Whether or not a strike takes place may to some extent depend in some countries upon the strength of the army or the police; but outside a totalitarian dictatorship, no government has ever succeeded in suppressing concerted stoppages of work. In Czechoslovakia, Poland and Hungary not even the Red Army, which has no national sympathy for the workers of those countries, has been able to prevent great strikes for justice and better living standards, tanks and field guns notwithstanding. The prime consideration for reform of this branch of the law lies in the fact that the law of tort can do little, if anything at all, to promote good industrial relations, but it can certainly do a lot of harm. Strike leaders should not be penalised because of inherent defects in our system for resolving industrial disputes. Over recent years, we have seen a new development in Australia. A number of cases have been brought to recover damages and for injunctions in respect of industrial disputes.

Mr Lynch:

– How many?

Mr Clyde Cameron:

– Altogether now, 6 cases have been taken in recent times which involved the use of civil proceedings to obtain damages against unions and union members involved in industrial actions. There is a renewed fear among trade unionists that employers with the aid of the civil courts, will re-introduce a weapon which will turn the history of this country back just as the working people are coming out into the light.

In England, in 1800, trade unions were illegal. Since that time trade unions in England, and later in Australia, have had to conduct a running battle with the courts and the legislature to emerge from that illegality into the same conditions of freedom enjoyed by the profit making corporations invented by businessmen. Trade unions have consistently sought legal recognition of the fact that by the special nature of their social tasks they are not predators and enemies of society but rather that they are an essential instrument for the protection of the weak and the maintenance of some fair proportion in the distribution of wealth between capital and labour. The trade unions have always argued that the role of the law should be to assist and not to hinder them in this work.

In the early 1800s the French Revolution caused the English ruling class to have a special fear of organised labour. According to Sidney and Beatrice Webb:

The first twenty years of the nineteenth century witnessed a legal persecution of the trade unionists as rebels and revolutionists.

All Australians remember that part of our history which refers to the Tolpuddle Martyrs. Six Dorchester labourers, in 1834, who took a union oath at Tolpuddle, who merely spoke short words amongst themselves testifying to their mutual loyalty and did nothing else, were deported to Australia for 7 years. The late Dr H. V. Evatt described this whole affair as ‘injustice within the law’ in his book of that name.

Acts against the combination of working men were passed on several occasions between the 14th century and 1800. The judges in that period regarded union organisation as criminal conspiracy. An example can be found in the remarks of Mr Justice Grose, who in 1796, said:

As in the case of journeymen conspiring to raise their wages: each may insist on raising wages if he can. but if several meet for the same purpose it is illegal and the parties may be indicted for a conspiracy.

Conspiracy in law means, among other things, the doing of a lawful act by unlawful means. Thus for instance, an attempt to raise wages is not unlawful in itself, but when it is done in concert, it becomes unlawful because the judges have said that combinations of working men are unlawful. The struggle of the trade unions to overcome these legal handicaps culminated in 1875 in the Conspiracy and Protection of Property Act which provided that in contemplation of furtherance of a trade dispute, no combination to do, or procure, any act should itself be a criminal conspiracy sinless the act itself would be punishable as a crime. Simple conspiracy was henceforth banished from trade disputes as a ground of criminal liability. Criminal liability was not, however, the only legal handicap suffered by the unions. Unions were deemed not to exist under the civil law. Their rules had no worth in the civil courts and doctrines relating to restraint of trade were used to harass the work of trade unions.

In the case of Hornby v. Close in 1867, a union which sought to prosecute an official who had embezzled funds failed in the prosecution for want of lawful status for the union’s rules. ‘1 do not say’, commented Mr Justice Blackburn, ‘that the objects of this society are criminal. I do not say that they are not. But I am clearly of opinion that the rules referred to are illegal in the sense that they cannot be enforced’. Union rules in Australia are no longer illegal or unenforceable. Union rules, once registered under the Commonwealth Conciliation and Arbitration Act, carry the full force of the law.

In 1901, a union in the United Kingdom placed a picket on the premises of an employer where a strike was taking place. The employer sought an injunction to restrain the men from preventing labour from entering his premises but the union argued that since it did not exist in law, it could not be enjoined or sued for damages. The argument failed, the injunction was granted, and the union ultimately fell liable for a very large sum of damages. That was the infamous Taff Vale case of 1901 which was concluded in the House of Lords in 1902. The great trade union agitation which followed the Taff Vale decision finally forced the House of Commons, in 1906, to pass legislation to set aside that piece of judge-made law. The immunity from actions for tort that was granted to British unions by the House of Commons in 1906, is now extended by this Bill to officials and members of Australian trade unions.

There is nothing novel in what is proposed in this Bill. It is based upon the principles of the British Trade Disputes Act of 1906 which granted unions and union officials in that country exemption from tortious actions committed in furtherance of industrial disputes. What we are proposing is not unique even in Australia. A provision of the nature has existed in Queensland for many decades. Indeed, my opposite number in the Queensland Government, told the recent conference of Commonwealth and State Labour Ministers that the Queensland law had caused no problems in that State. In point of fact, it is only within the last three or four years that we have witnessed attempts in the other States to put life into the remains of an outmoded law that has been resting in the cemetery of English law for 67 years.

Strike Penalties

The Government is firmly committed to the abolition of the penal clauses- the criminal sanctions against the working man who withdraws his labour. Its policy is clear. The Prime Minister’s mandate is precise. As promised in the Prime Minister’s policy speech, the Bill provides for the removal from the Act of all provisions under which a penalty might be imposed upon a trade union or member, because a union is involved in, or threatens a strike, ban or limitation on work. The inclusion of ‘bans’ clauses in awards and certified agreements is prohibited. If unions wish to submit to the inclusion in an agreement of a bans clause they may do so, but that agreement cannot be certified by the Commission. Furthermore, it will be no longer possible for any penalty to be imposed in respect of any bans’ clause which may already exist in an award or a certified agreement.

Much was said by the Opposition, when in government, to the effect that the existence of sanctions was essential to the functioning of our conciliation and arbitration system. The fallacy of that claim is demonstrated by the fact that the previous Government saw the wisdom of not collecting the fines amounting to $20,700 which had been imposed upon unions under the penal provisions which existed prior to 1970. These fines remain unpaid. It was that Government which, whilst claiming that penalties for award enforcement were absolutely essential, prosecuted for only 5 award breaches in its last 2 years - 5 out of the 24,000 breaches uncovered by its arbitration inspectors. Even under the last Government, the penal provisions against strikes were a dead letter. This Government takes the formal step of removing them from the Act.

Industrial Agreements

There are two sensible ways of encouraging the settlement of disputes without stoppages. The first is to encourage the parties to settle their differences by direct negotiation and to give their agreed conclusions the benefits of certification as agreements under the Act. The second is to offer parties the services of professional conciliators employed under the Act to assist them to reach agreement for the making of a consent award. Where agreement proves to be impossible, the Act provides for arbitration of the matters remaining in dispute. In the past, conciliators were given a final power to act as arbitrators if the need arose. But in the 1972 Act the conciliation arbitration functions and the two functions in any one dispute must now be discharged by different persons.

Grave problems have arisen in the operation of these provisions. The best talent for the one function or the other has not always been wearing the right hat. Parties have sometimes expressed a preference for arbitration to be carried out by the person who attempted to conciliate the differences between the parlies. The work load between commissioners has varied substantially. There has been an increase in internal paper work, and in some cases delay in achieving final settlements. The Government functions were separated completely from the will continue the experiment of the present panel system for the time being, with some separation of conciliation from arbitration in an amended form. The Bill provides that all presidential members and commissioners shall have the power to exercise both conciliation and arbitration functions with the proviso that a member of the Commission who has exercised the function of conciliation may not arbitrate in a particular matter if any party to the proceedings objects.

As a mark of the Government’s promise to reduce the amount of Commonwealth intervention in industrial disputes, the Bill will alter the objects of the Act in such a way as to place greater stress on the provision of ways and means for parties in dispute to reach amicable agreement without outside interference. (Mr Lynch interjecting.)

Mr Clyde Cameron:

– I wish you would keep quiet. You are chirping over there like I do not know what. It seems that you do not understand what I am reading out and you continually harass me by silly little chirps, meaning I do not know what. Would you try to control yourself and listen to what I am putting to the Parliament? I repeat: It is the Government’s intention to do everything possible to provide that the terms and conditions of employment of workers be regulated by freely negotiated voluntary agreements and that these agreements be certified and given the full force of an award under the Conciliation and Arbitration Act. It is the view, not only of the Government, but also the trade union movement, and I believe, the majority of employer organisations that this procedure is preferable to having conditions arbitrarily imposed on employers and employees. The Bill provides that the Commission shall not ment of an industrial dispute unless the certification of it would cause a major detri.refuse to certify an agreement made in settlement to the public interest. Provision is made also to enable a single member of the Commission to certify agreements which contain matters which have hitherto been reserved to the Full Bench for certification, that is matters such as changes in the standard hours of work, annual leave, and so on. A single member of the Commission, however, will still have the right to refer such an agreement to the President of the Commission if he believes that the issues raised are likely to cause a major detriment to the public interest. In these cases the President will determine whether the issue should be considered by a Full Bench. Appeals against agreements and consent awards will be prohibited.

On the other hand, the Government is concerned to see that where agreements are entered into, they do, in fact, represent the wishes of those members of the organisation, be they trade unions or employer organisations, who are affected by the agreement. In future, no agreement wall be certified unless the member of the Commission is satisfied that the principal terms of the agreement have been approved by the committee of management of each of the organisations and that those terms are acceptable to a majority of the members affected by the agreement. Where the member of the Commission is not so satisfied, he has the right to direct the Industrial Registrar to conduct a ballot to ascertain the views of those members of that organisation who are affected by the agreement. In future, no certified agreement may be made for more than 3 years. In future, an agreement will not be continued in existence after its expiration merely by virtue of the existing provisions of the Act. However, it will be possible to reopen an agreement by leave of the Commission or by agreement of the parties during its period of operation. Moreover, it will be possible, and desirable, for parties to a certified agreement to be free to begin negotiations for a new agreement before their current agreement expires.

Participatory Democracy

Participatory democracy will be an essential ingredient for the proper functioning of the amalgamated unions. As unions become larger, and their governing bodies become more remote from the membership, it will be important to safeguard against the development of bureaucratic relations between the leadership and the rank and file. This Government will encourage the elimination of tendencies that prejudice democratic control of trade unions by assisting rank and file members to bring their grievances over alleged defects in rules and in abuse of rules, to the Commonwealth Industrial Court for examination and, where called for, correction. As well, an officer of the Registry will have the responsibility for giving the Registrar detailed advice on the acceptability of rules, and proposed amendments to rules that are submitted for registration.

The platform of the Australian Labor Party calls upon the Government to ensure a system of democratic control of all unions, allowing fullest participation by members in their affairs. The Bill makes changes in the conditions of registration of organisations towards achieving that end. A person who exercises management functions, or functions relating to the making, alteration or enforcement of rules, or who occupies a position with duties substantially the same as those of an elected office, becomes the holder of an ‘office’ for the purpose of the Act and, subject to certain qualifications, will have to be elected by the rank and file. The Bill provides that no officer elected by the rank and file may be dismissed during his period of office unless he is guilty of misappropriation of union funds, a grave breach of rules or gross misbehaviour or gross neglect of duty. It will no longer be enough that his services are not needed by the ruling faction in a committee of management.

Financial members are to be given an absolute right to vote in any election for office bearers and in plebescites touching rules or policy. No person who is a candidate in an election for an office shall be permitted to determine whether any other candidate for election is eligible to stand for office. The right to determine eligibility of candidates will be vested in a returning officer, being a person who is not an employee of the organisation or holding any other office in the organisation. In the past, nominations have been scrutinised and rejected by the very persons who were under challenge in a pending election. I do not have to enlarge on the sense of injustice suffered by the individual candidate and the distortion of fair control of a trade union which can arise in a case of the type now provided against. Section 144 is amended to provide that a person who is employed in an industry shall be entitled to membership of an organisation providing he complies with the conditions of eligibility in the registered rules of that organisation.

Statute of Limitations

When a businessman enters into a contract with a trading enterprise for the purchase of goods or for the building of a factory, and his contractor fails to carry out his obligations under contract, the law usually allows him 6 years, sometimes longer, to bring a claim for damages in respect of his losses to the court. Similarly, if a debtor fails to pay money owing by him and defaults upon his lawful obligation, our businessman is given 6 years in which to sue for recovery of what is justly due to him. In the view of this Government, a worker is entitled to the same consideration as a businessman as to the time in which he can sue a defaulting employer to recover wages which he has been underpaid, annual leave which he has not been granted, or long service benefits which the employer evaded when his obligation was due. Fair-minded employers will not seek to deny to workers the rights they themselves enjoy. This Bill therefore extends from 1 year to 6 years the time in which an action may be taken to recover amounts underpaid as a result of obligations under an award or certified agreement. This will apply to actions taken under the provisions of section 119, or by employees themselves under section 123.


The Government proposes to abolish the power to make orders for costs against parties in proceedings arising under the Conciliation and Arbitration Act. This is part of our policy of bringing the courts to the people, of overcoming the deterrent which often prevents a person from seeking to right a wrong because of the burden of costs he might incur where his argument has failed to carry the day. There have been cases where costs awarded against individuals in the court have led to the bankruptcy of working men and to the seizure of their property because they have employed the court to settle their differences with an opponent. We do not wish to see men tempted to resort to direct force to defeat a rival in a union conflict. Our industrial conflicts over the years have been happily free of violence or the threat of violence. The possibility of having costs awarded against an applicant discourages the use of courts as a means of settling differences.

There is, of course, some statutory provisions which are available to assist rank and file unionists who wish to bring cases to the Industrial Court. The Act now provides for financial assistance to be granted in some cases by the Attorney-General but this only applies to actions taken under certain sections of the Act. Furthermore, it does not cover assistance where such a union member is required to defend in the High Court a decision given in his favour by the Industrial Court. I have been through this experience myself. I had 2 cases in the Commonwealth Industrial Court. One was taken on appeal to the High Court and I had to chase that appeal from my own pocket. The second case, which I also won in the Industrial Court, was taken on appeal to the Privy Council, and I had to bear the burden of that cost out of my own pocket. The union executive against which I was taking my action for justice - it was an action for justice because in both cases I won - was able to draw upon the funds of the union, but I was a private individual with no money except my own personal possessions.

The Attorney-General, of course, has the power to make ex gratia payments in respect of costs after the event, and many such payments have been made where unsuccessful litigants of poor means have been threatened with sequestration of their worldly possessions. Relief of this kind is unsatisfactory because it is discretionary and is generally long delayed. The Bill provides that no costs shall be awarded against any party in any proceeding before the Commission, the Industrial Court, the court of a State or a Territory, or the Registrar, which is a matter arising under the Conciliation and Arbitration Act. A similar provision in the Bill prohibits the granting of costs in the High Court in appeals coming before it from judgments, orders or sentences made by the Industrial Court or another court under this Act or in proceedings in respect of an award.

Moore v. Doyle

Over recent months, there have been a number of disputes between 2 groups of transport workers in New South Wales concerning the legal status of transport workers belonging to the respective State and Federal Transport Workers Unions. The Federal union is an organisation registered under the Commonwealth Act, and the State union is a separate union registered under New South Wales law. A dispute between members of these 2 bodies was heard and determined by the Commonwealth Industrial Court in 1969, and is reported under the name of Moore v. Doyle. The state of affairs revealed by that decision has caused the greatest concern to all persons involved in labour relations. Judgment in that case was given in February 1969, but in the 4 long years that have elapsed since then, and in spite of the clear invitation of the Court for action to resolve the anomaly, the Gorton and McMahon Governments virtually ignored the problems raised by that case. In the limited time available to me, it is not possible to explain the full complexities of the decision. Some highly abstract ideas must be mastered before one can comprehend the problem and find the solution. No single legislative body, Federal or State is capable of dealing with all the legal questions involved or of propounding a solution that Will hold in every industrial jurisdiction, under present constitutional arrangements. The head note to Moore v Doyle is worth noting and reads:

For some 40 years after the adoption of a scheme designed to achieve the amalgamation of a New South Wales State Trade and Industrial union with a federal organisation registered under the Conciliation and Arbitration Act, the State trade union continued to conduct its affairs in accordance with its own rules and State industrial law and pursued with vigour benefits available to a State trade union under State law. During such a period, members of the State trade unions became members of the New South Wales branch of the Federal organisation. The State trade union, inter alia, assumed the name of and rendered accounts and accepted obligations as the New South Wales branch of the federal organisation. The scheme of amalgamation was assumed by its authors and actors to have achieved the continued existence of the State trade union and, at the same time, its establishment as a branch of the federal organisation.

It was held, in the circumstances of the case to which I just made reference, that the State trade union had not ceased to exist, and that it was not a branch of the Federal organisation. The result of this decision was that the Commonwealth Industrial Court was unable to issue orders against an officer of the State union for his compliance with federally registered rules. It follows, therefore, that the

Commonwealth Arbitration Commission has no power to make an award, or certify an agreement, binding on the State union. It is the legal situation revealed by this decision which is at the root of the dispute between the 2 groups concerned to represent transport workers in New South Wales, and which threatened the delivery of petrol in that State in February of this year. It is an irritation to most unions; an intractable problem for some. In the course of its 1969 judgment the Court had this to say:

Cases referred to earlier in this judgment are further illustrations of the web of problems and technicalities which have developed in the system of trade union organisation in Australia . . . The system as required to exist by State and Federal legislation and as it has evolved under that legislation in practice is technical, productive of artificialism and in urgent need of the attention of the law reformer … A system of trade union organisation is urgently needed which would enable the one body to represent its relevant members in both the Federal and State arbitration systems and it should be possible for federal and state authorities to examine the question whether organisations and trade unions can be provided with such a system … we have decided to refer our judgment in this matter and these remarks to the AttorneyGeneral for the Commonwealth in the hope that it may be possible, after consultation between the Commonwealth and State Attorneys-General, the trade unions both federal and state, and other interested government authorities to arrange for the important organisational matters to which we have referred.

In a later case subsequent to the Moore v. Doyle case, namely, the case of Steuart v. Oliver, it was held, in respect of the Australian Workers Union, that a substantial number of persons were legitimate members of a body known as the Australian Workers’ Union of Queensland, a State union, but were not entitled to be members of the Australian Workers’ Union created by the Commonwealth Act. The coverage of industry was different in the 2 sets of registered rules. It was held in that case that there were 2 separate unions. The 2 unions were funded and administered for all practical purposes as if they were one. Membership of the one did not entitle a person to vote in the elections of the other, although that had always been the practice of the 2 unions for nearly 60 years.

It is against this background of technicality and confusion that the Australian Labor Party platform declares that the Constitution must be amended to allow the system for the resolution of industrial conflict to be modernised by enabling the Australian Parliament to establish sensible means for the resolution of questions relating to terms and conditions of employment. The State Parliaments have this power. The Government believes that the National Parliament must have similar powers. In the interim, however, we must work through the existing Constitution, however defective it is. The complete solution to Moore v. Doyle in these circumstances requires complementary Federal and State legislation. I have already had preliminary discussions with the State Ministers for Labour on this problem and shortly I will be initiating further discussions with them. The State Ministers appreciate the problems involved in the matter and will, I believe, give their full co-operation in assisting the Government to take whatever steps are necessary to put an end to the present chaotic state of affairs.

However, in this Bill we are initiating a further important step to overcome some of the difficulties caused by the Moore v Doyle decision. Section 132 of the Act, which prescribes the conditions which must be complied with by a registered organisation, is amended to provide that an organisation registered under the Commonwealth Act will in future be able to include in its membership persons who are not employees in the industry covered by the organisation so long as they follow an occupation in or in connection with that industry, or are qualified to be employed in or in connection with that industry. This will enable the Transport Workers’ Union of Australia to include as members, owner-drivers in New South Wales and other States. This is by no means the complete answer to the difficulties that have caused the current dispute among transport workers and it does not even touch difficulties affecting other unions. As I have said, this amendment does not completely solve the Moore v Doyle problem, but it does remove one of the issues causing difficulties. It still will be necessary for the Commonwealth Parliament to legislate further on this issue, but this cannot be done until further conferences can be arranged with the 6 State Ministers for Labour.

Award Interpretation

A great deal of industrial unrest revolves around difficulties and misunderstandings as to what is meant by the terms of various awards and agreements. In the past, where a deadlock occurred as to the meaning of a term of an award or agreement, the only way to determine the matter was for the Arbitration Inspectorate to take a prosecution against an employer. Whilst there has been provision in the Act for a union or an employer to seek an interpretation of an award or agreement, delayed hearings and heavy costs have discouraged parties from making use of this provision.

I had previously indicated that I would seek to overcome this problem by requesting the Arbitration Inspectorate to initiate prosecutions in all cases where an award interpretation was required. My Department has counselled me against the use of prosecutions merely for the purpose of obtaining an interpretation of awards or agreements and has suggested that as an alternative the Government should amend section 110 so as to permit the Secretary of the Department of Labour or an inspector to apply to the Court for an interpretation. In this way the costs of the proceedings will be borne by the Commonwealth. There would be no question of prosecuting an employer or of imposing a heavy penalty upon an employer who, without any malice aforethought or through genuine misunderstanding of the award, had failed to comply with its requirements.

I believe that it is the duty of the Government to assist in clarifying awards made by its own tribunals. I have accepted the Department’s advice and the Bill provides an amendment of section 110 in the terms indicated. This will mean a substantial increase in the work of the Industrial Court because this is the only Court that can make an interpretation of a Federal award. At present, section 98 of the Act limits the number of judges of the Court to a Chief Judge and not more than 7 other judges.

Since its inception, there has been an increasing use of the Court for purposes other than its functions under the Conciliation and Arbitration Act. Apart from the fact that judges of the Court act as judges of the Australian Capital Territory and the Northern Territory, judges have been called on to carry out special assignments. For example, Mr Justice Kerr, before he left the Bench to become Chief Justice of New South Wales, carried out a major inquiry into pay and conditions in the armed services. Mr Justice Woodward has succeeded to the task of Mr Justice Kerr in this field. He also is concerned with other activities on behalf of the Government in relation to Aborigines. Mr Justice Nimmo is now acting as Chief Justice of the Supreme Court of Fiji and is not likely to return to the Australian Industrial Bench for at least 4 years, if at all, and Mr Justice Eggleston is engaged on duties connected with the administration of the Trade Practices Act. From time to time, the number of judges on the Court has been increased to meet the increasing work load. On virtually every occasion in the past, it has been necessary to further amend the legislation to enable additional judges to be appointed.

Justice delayed is justice denied. The Government believes that constant legislation of this nature is unnecessary and that it is far more satisfactory to remove the limitation on the number of judges who may be appointed to the Court so as to provide that the Court shall consist of a Chief Judge and such number of other judges as are appointed from time to time. This simple amendment will enable the appointment of new judges whenever the work load warrants it. It will ensure that action can be taken quickly to ensure that cases coming within the jurisdiction of the Court are heard and disposed of promptly.

Miscellaneous Matters

The President of the Arbitration Commission, Sir Richard Kirby, has made a strong plea that future presidential members who are qualified for judicial appointment should be given the same designation as a judge of the Industrial Court in addition to the same rank, status and precedence of a judge which they now enjoy. The President’s view is supported by the Acting President, Mr Justice Moore. The Government has accepted their views and the Bill provides that new presidential members who are eligible for judicial appointment will be granted the title ‘Justice’.

The. Bill contains a number of other miscellaneous provisions. Among them is a provision to correct a deficiency in the 1972 Act which prevented single members of the Commission from making awards on matters covered by section 31 of the Act, for example, national wage and standard hours, where the award was simply to give effect to principles previously enunciated by a Full Bench. Provision has also been made in the Bill to give an extended right to union officials to enter at any time during working hours at establishments covered by Federal awards.

In this way full time officials will be better able to enforce the observance of safety regulations, clear up misinterpretations of awards, smooth out demarcation differences, interview non-unionists, detect symptoms of potential unrest, and smooth out abrasive managerial policies. I have never been able to understand why so many employers do so much to impede the on-site activities of full time officials and then blame the union when its shop stewards find themselves with an avoidable dispute on their hands. Mr Michael Clarke, Assistant Director of the Industrial Society of the United Kingdom, with splendid clarity, wrote:

More often than not full-time trade union officials are treated like the fire brigade and only get called in when things have already gone wrong.

The Bill also repeals the provision inserted in 1972 which provided, for the first time, for inquiries into officially conducted ballots. The Government believes that the safeguard* in relation to officially conducted ballots are such that there is no need to provide for inquiries into them. Another clause of the Bill removes the 1972 provision requiring organisations regularly to notify the Registrar of the whereabouts and state of their bank accounts. This provision was ancillary to the penal sanctions against strikes. With these penalties removed completely from the Act, there is no justification for retaining such an onerous provision.

Mr Speaker, in outline, those are the provisions of this Bill. I have explained that we will remove those provisions which discourage amalgamation of unions; that we will protect organisations and their members from civil actions for tort in connection with industrial disputes; that we will remove completely from the Act the power to prohibit strikes or enforce penal sanctions against strikes and that we will build the framework for more democratic control of unions. I would not need to be a prophet to predict that the Opposition will claim that this Bill favours employees. When it was in government, the present Opposition while claiming always to represent all interests, in point of fact quite blatantly ignored, or damaged, the interests of employees. The McMahon Government’s last set of amendments to this Act was preceded with a ritualistic and phoney series of meetings between employers and trade unions which were memorable only because the minutes of those meetings show that the then

Minister accepted virtually all of the employers’ requests and rejected virtually all of the unions requests. That was the former Government’s idea of national government. This Bill goes part way to redressing the balance. In doing so, it will secure for our conciliation and arbitration system very much better foundations than those laid by any previous government. The conciliation and arbitration system is struggling to find a new role in a changing environment. We will help it to find that role by removing its most objectionable features and developing those conciliatory features most useful in today’s environment. Ultimately, we will save the framework of Australia’s conciliation and arbitration system by accommodating to change. The former Government’s attempts at repression would have destroyed the system of conciliation and arbitration. Mr Speaker, I commend the Bill to honourable members.

Debate (on motion by Mr Lynch) adjourned.

page 1436


Bill presented by Mr Clyde Cameron, and read a first time.

Second Reading

Mr Clyde Cameron:

– I move:

That the Bill be now read a second time.

The primary purpose of this Bill is to enable Parliament to approve ratification by Australia of amendments to the constitution of the International Labour Organisation. In this the Government is following the example set by the Chifley Government in 1947 on the occasion of major changes to the ILO constitution following World War II. The Government reaffirms its strong support for the ILO and its wide-ranging activities concerned with the promotion of social justice throughout the world. The ILO is unique in the international community because it is the only organisation in which representatives of workers and employers participate on an equal footing with those of governments in policy formulation and decision-making. This tripartite composition ensures that the ILO is widely representative of each country and that its work is clearly established in, and focussed on, the human and social problems of the people of the. world and the real improvement of their life. For this reason alone it deserves the support of us all.

It would take too long to list all the achievements of the ILO during the 54 years it has been in existence. It is sufficient to say that it has had a major role in promoting the acceptance and application of human rights in such areas as abolishing forced labour, promoting freedom of association and removing discrimination in employment. It has underlined the importance of social considerations in the drive for economic development. It has provided fresh hopes, insights and support to those seeking improved living and working conditions, while being at the same time, conscious of economic realities. Finally it has stressed the relationship between social justice and peace - ‘universal and lasting peace can be established only if it is based upon social justice’. In recognition of its work the ILO received the Nobel Peace Prize in 1969.

These emphases continue to guide the ILO’s work program. For example, a current thrust of the organisation is aimed at urgent, effective action to deal with the massive problems of unemployment and underemployment existing in many parts of the world. Its world employment program is directed at ensuring that governments must take employment considerations into account in formulating their development plans and programs. It is quite evident, as the members of the Opposition can testify, that high rates of unemployment bring political retribution. The ILO has made it clear that the achievement of high levels of employment does not occur as a spin-off from high rates of economic growth. It occurs only if governments accept it as a priority objective of policy and act accordingly.

No one can guarantee that the ILO activities in the employment promotion field will be successful but it is obvious that unless the high levels of unemployment and underemployment in many parts of the world are reduced rapidly there is a danger not simply of economic stagnation but of political and social conflict of crisis proportions in many countries. The Government vigorously supports the ILO work under the world employment program and its regional segments and I hope to discuss with the Director-General of the International Labour Office, Mr Wilfred Jenks, when I am in Geneva in June ways in which this work can be advanced.

Perhaps the ILO is best known for its standardsetting activities. Annual sessions of the International Labour Conference - it has been called the world parliament on labour and social questions - adopt international conventions and recommendations dealing with most aspects of living and working conditions. The 136 conventions and 144 recommendations constitute an international labour code covering virtually the whole of the labour and social fields. I would hope that all members share the Government’s belief in the value of ratifying as many of the ILO conventions as quickly as possible. It is Australian Labor Party policy. It was the policy which was unanimously adopted by the delegates present at the Launceston Federal Conference.

First, acceptance and ratification of ILO conventions helps to impart a favourable international image of Australia as a forwardlooking country which gives priority attention to vital areas of human relations. It is essential, I believe, that Australia have a good record of ratifications if we are to be able to speak with authority and standing in the international community on labour and social matters. Second, a good record of ratification would underline our support for the work of the International Labour Organisation, the tripartite character of which, with representation by employers and workers as well as Governments, as I have mentioned, gives it a unique standing among international institutions. Third, as an advanced economy in a region comprising mostly developing countries, the Government firmly believes that Australia should be fa the vanguard of countries taking action to foster and develop sound labour and social policies in accordance with accepted international standards. Acceptance of the concept of fair labour practices is important and, indeed, was one of the premises on which the ILO was founded.

Fourth, the ratification of ILO conventions stimulates us to improve our own standards. Fifth, Australia has a very special responsibility for Papua New Guinea which will soon be self-governing and independent. Industrial relations in the Territory frequently have racial ramifications, since most employers are expatriates and most employees are indigenes. It is important, therefore, that Australia should leave Papua New Guinea with industrial laws which accord with international standards. There are several conventions of particular significance for Papua New Guinea which can only be extended to Papua New Guinea and our other non-metropolitan territories when they have been ratified in respect of Australia itself.

Since coming to office the Government has taken positive action to improve Australia’s record of ratifying ILO conventions, a record which leaves much to be desired. Up to December last Australia had ratified 33 conventions out of the 136 conventions adopted by the International Labour Conference. This is just under the average, number of ratifications for the 123 member States of the ILO, a considerable proportion of which are developing countries. When I add that some 19 countries have ratified more than 50 conventions and that France has been able to ratify 93 conventions, the extent to which Australia has fallen behind is all too evident. Of course we face difficulties because of our Federal Constitution but if Australia genuinely wishes to ratify conventions ways can be found to do this.

Already this Government has made significant advances in promoting CommonwealthState co-operation. The Prime Minister (Mr Whitlam) wrote to all State Premiers in December last stressing the importance, which the Commonwealth Government attaches to the ratification of ILO conventions and requesting their support in stepping up the pace of ratifications. He indicated that priority attention was being given to those conventions dealing with fundamental human rights which Australia had not ratified at that time. These were: Convention No. 87 - Freedom of Association and Protection of the Right to Organise, adopted by the ILO in 1948; Convention No. 98 - Right to Organise and Collective Bargaining, adopted in 1949; Convention No. 100 - Equal Remuneration, adopted in 1951; and Convention No. Ill - Discrimination (Employment and Occupation), adopted in 1958. Conventions Nos 87 and 98 were subsequently ratified by Australia on 28th February this year. I and my Department are working actively towards early ratification of Conventions Nos 100 and 111. 1 hope to make statements on these instruments very shortly.

The ratification of ILO conventions has also been discussed with the States - at ministerial level at the meeting of Commonwealth and State Labour Ministers in February and at permanent head level at the meeting of the Departments of Labour Advisory Committee held in Papua New Guinea last week. Ministers decided that a working party of Commonwealth and’ State officers would be set up to report to their next meeting, scheduled for later this year, on how the ratification of ILO conventions might be accelerated, including the establishment of an order of priority for action in respect of particular conventions. The working party will hold its first meeting, I am pleased to say, next week.

The Government is moving quickly to fulfil all of Australia’s outstanding obligations connected with the application of ILO conventions ratified by Australia to our nonmetropolitan territories. Thus the Government is consulting with the Government of Papua New Guinea to clear up outstanding action required in respect of ILO conventions ratified by Australia. For the first time a tripartite observer delegation from Papua New Guinea will be attending this year’s session of the International Labour Conference and I anticipate that in company with the Minister for Labour of Papua New Guinea and the other members of the Papua New Guinea delegation I shall be able to register with the Director-General of the International Labour Office a considerable number of declarations on ILO conventions for Papua New Guinea.

Attention is also being paid to making declarations for the Cocos (Keeling) Islands and Christmas Island for conventions ratified by Australia. It is a matter of some embarrassment to Australia that the requirements of the ILO constitution that declarations must be made for these Territories have not yet been fulfilled. This will be one of the matters to be discussed by my colleague, the Minister for External Territories (Mr Morrison), when he meets Mr Clunies Ross next weekend. I hope that he will find time to discuss it fully.

In addition, the Government is giving final consideration to ratifying the 4 ILO conventions relating solely to non-metropolitan territories. They are: Convention No. 82 - Social Policy (Non-Metropolitan Territories), 1947; No. 83 - Labour Standards (NonMetropolitan Territories), 1947; No. 84- Right of Association (Non-Metropolitan Territories), 1947; and No. 86 - Contracts of Employment (Indigenous Workers), 1947.

All the measures I have mentioned speak for themselves in demonstrating the Government’s determination that Australia’s record of ratification of ILO conventions can, and will, be improved significantly. Let me turn now to the specific provisions of the Bill itself. As I indicated at the outset, its primary purpose is to enable the Parliament to approve ratification by Australia of the amendments to the ILO constitution adopted in 1964 and 1972.

The 3 amendments adopted in 1964 involve matters of some significance. None of these is yet in force and the Government hopes that ratification by Australia will give a new impetus to their ratification or acceptance by other countries. Amendments to the ILO constitution come into force only when they are ratified or accepted by two-thirds of the member States of the ILO including 5 of the 10 States of Chief Industrial Importance.

The first of the 1964 amendments was designed to strengthen obligations on ILO member States with responsibilities for nonmetropolitan territories in relation to the application of ratified ILO conventions. Under the 1LO constitution at present, when a member State responsible for the international relations of non-metropolitan territories ratifies an ILO convention there is no specific time limit in which it is required to make declarations providing for the applicability of the convention to its non-metropolitan territories. The main effect of the amendment is to make it an obligation for declarations to be made at the time of ratification. The principles it embodies have received wide support and the previous Government was proposing to ratify the amendment at a later date. The new Government sees no reason for delaying any longer Australian ratification of the amendment which will assist in improving working and living conditions in nonmetropolitan territories.

Of the other 2 amendments adopted in 1964, one provided for the suspension from participation in the International Labour Conference of any ILO member State which had been found by the United Nations to be flagrantly and persistently pursuing by its legislation a declared policy of racial discrimination such as apartheid and the other for the expulsion from the ILO or suspension from the exercise of the rights and privileges of membership of the ILO of any member which the United Nations had suspended from the exercise of the rights and privileges of membership. These amendments are now of less significance than when they were adopted in 1964 because South Africa has since left the ILO. Nevertheless, the Government proposes to ratify them to demonstrate Australia’s firm opposition to all forms of racial discrimination such as apartheid.

As to the amendment adopted last year, it provides for an increase in the number of titular members of the governing body of the International Labour Office from 48 to 56. This was agreed on virtually unanimously by the Conference last year and the Australian Government, employer and worker delegates all supported it. The amendment is designed to restore the relationship between the size of the governing body and the number of members of the ILO, which has increased with the entry into the organisation of newlyindependent States.

The Government is also taking the opportunity while the legislation is before the Parliament to provide for approval of the two amendments to the ILO Constitution accepted by the Australian Government on 20th August 1953 and 21st December 1962. These amendments came into force on 20th May 1954 and 22nd May 1963 respectively and had the effect of increasing the size of the Governing Body of the International Labour Office. In introducing this Bill the Government is indicating its firm and vigorous support for the ILO, its basic concepts and the work it performs. I commend the Bill to the House.

Debate (on motion by Mr Lynch) adjourned.

page 1439


Ministerial Statement

Mr Les Johnson:
Minister for Housing · HUGHES, NEW SOUTH WALES · ALP

– For the information of honourable members I present a copy of an instrument dated 3rd February 1973 made pursuant to section 5 of the Housing Loans Insurance Act 1965-66 declaring a class of persons to be an approved class of lenders. I seek leave to make a short statement.


-Is leave granted? There being no objection, leave. is granted.

Mr Les Johnson:

– I have laid on the table a copy of an instrument made pursuant to section 5 of the Housing Loans Insurance Act 1965-66 declaring credit unions, credit societies and other co-operative, industrial and provident societies that make mortgage loans to their members to be approved classes of lenders. Section 5 of the Housing Loans

Insurance Act provides that approved classes of lenders may be declared by the Minister for Housing and that individual lenders within these classes may be approved by the Housing Loans Insurance Corporation. The classes of lenders already approved include most of the main sources of housing finance, and the Corporation has approved more than 500 individual lenders within these classes.

The declaration of credit unions as an approved class of lender follows the liberalisation of the conditions under which they may be accepted as repositories for savings under the homes savings grant scheme and indicates the Government’s support for the credit union movement. It is now open for credit unions to apply to the Corporation to become approved lenders and to insure with the Corporation those housing loans which meet its requirements. The instrument also caters for co-operative societies other than credit unions which are registered or incorporated under laws relating to co-operative, industrial or provident societies and which lend to their members on mortgage security. I believe it is desirable that all reputable organisations that wish to insure their housing loans with the Corporation should be able to do so provided they meet the Corporation’s conditions. I present the following paper:

Housing Loans Insurance - Ministerial Statement, 12 April 1973- and move:

That the House take note of the paper.

Debate (on motion by Mr Lynch) adjourned.

page 1439


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

Second Reading

Minister for Science and Minister for External Territories · St George · ALP

– I move:

The purpose of this Bill is to amend the Parliamentary Proceedings Broadcasting Act to extend the protection afforded by section 15 of the Act to the Territories not forming part of Australia. Section 15 of the Act provides that no action, civil or criminal, shall lie for broadcasting or rebroadcasting any portion of the proceedings of either House of Parliament. Although the only coverage desired of such broadcasts is domestic, reception may extend to other areas because of variations in atmospheric conditions.

The Bill does not specifically bar any action or proceeding pending or yet to be instituted in respect of a broadcast or rebroadcast made before the date on which the Bill comes into operation. The opportunity has been taken to incorporate minor amendments relating to dates and titles which would have otherwise been included in a proposed statute law revision Bill. I commend the Bill to the House.

Debate (on motion by Mr Peacock) adjourned.

page 1440


Ministerial Statement

Minister for Science and Minister for External Territories · St George · ALP

– by leave - I wish to inform the House about certain decisions that the Government has made concerning Christmas Island. The only commercial activity on Christmas Island is the extraction and export of rock phosphate and phosphate dust. The life of the commercially usable portion of the phosphate deposit at expected rates of extraction is about 20 years. When the phosphate industry ceases to operate there will be no economic future on the Island for the Asian residents that would be appropriate to their experience and skills. There are no indigenous inhabitants of Christmas Island. Asian workers brought mainly from Singapore have been employed in the Island’s phosphate industry since mining by the Christmas Island Phosphate Co. began in 1899. Most of the present Asian resident population came to the Island since World War, II or were born there. Since 1966, almost all workers brought to the Island have been on 3-year terms of employment and have been repatriated at the end of their contracts. Prior to this, Asian workers were recruited for an indefinite stay.

Most of the people who came to the Island as adults had little formal education but have acquired useful skills as a result of their employment in the phosphate industry. Those who came as children or were born there have had the benefit of primary and secondary education. The curriculum is based on the Singapore curriculum with .some modifications and senior students sit for the University of London General Certificate of Education. A technical training centre provides apprenticeship courses for school leavers and technical training for secondary school students. Those who successfully complete the appren ticeship course gain qualifications conferred by the Western Australian authorities. Various improvements to the educational system recommended by an educational adviser in 1970 are being made as rapidly as possible. Under the agreement entered into in 1958, the phosphate operations are controlled by the Christmas Island Phosphate Commission on behalf of the Australian and New Zealand governments, each of which has a 50 per cent share in the enterprise. This agreement superseded a similar agreement entered into in 1949, the year after the Australian and New Zealand governments acquired the mining rights from the Christmas Island Phosphate Co. The Commission employs the British Phosphate Commissioners to manage the mining and other operations and it is the Commissioners who employ the majority of the Asian workers on Christmas Island.

Phosphate from Christmas Island is of high grade and is the cheapest source for both Australia and New Zealand. Christmas Island supplies about one-third of the 2 countries’ total requirements of phosphate rock. In addition about 150,000 tons of phosphate dust are exported annually to Malaysia, Singapore and Indonesia. Christmas Island has been an Australian territory under the control of the Commonwealth since 1st October 1958 when Australia took over control from Britain. Under the agreement with the New Zealand government, the net expenditure of the Territory’s Administration is met by the Christmas Island Phosphate Commission. Under the Christmas Island Act 1958, adults who were British subjects and ordinarily resident on the Island on 1st October 1958 could opt for Australian citizenship within 2 years of that date. Those who were not 21 years on that date could opt for Australian citizenship on turning 21 years and up to 2 years thereafter. People born on Christmas Island on or after 1st October 1958 are Australian citizens by birth. At 30th June 1972, 497 Asian residents of Christmas Island were Australian citizens by birth or exercise of an option.

Because there will be no economic future for the Asian residents of Christmas Island when the phosphate industry ceases to operate, the Government has decided that such, residents who are not on fixed terms of employment should be given the opportunity to resettle progressively elsewhere at a rate that will noi adversely affect the operations of the phosphate -industry and will enable replacement to be made by recruitment of contract - fixed term - workers. Many of the Asian residents have greater ties with Singapore or Malaysia than with Australia and are likely to opt to go to those countries if they are accepted. Some 12S0 appear to have clear rights to go to Singapore, Malaysia or Indonesia through their possession of the citizenship of those countries. The remainder have Australian citizenship - about 500 - or undetermined citizenship - about 90. Those Asian residents who are not contract - fixed term - workers and who are Australian citizens will be entitled to residence in Australia on application. Such applicants will be counselled to arrange employment and accommodation before coming here. Those Asian residents who are not contract - fixed term - workers and who are not Australian citizens will be accepted for residence in Australia on application subject to availability of employment and accommodation and to health and character checks where deemed necessary. Those who did not qualify for residence in Australia under these provisions but who were not able to go to another country would be regarded, in principle, as acceptable for residence in Australia.

Resettlement will be a gradual and voluntary process. Every effort will be made to equip the people for resettlement through education and training on the Island, scholarships, resettlement grants and appropriate reception arrangements. This will be done for all permanent Asian residents, irrespective of the country in which they settle. A resettlement committee comprising officers of the Departments of Immigration, External Territories and Labour, will oversight the arrangements. Subject to negotiations at present being carried out with the New Zealand authorities, the Christmas Island Agreement Act 1958 will be amended to permit the Christmas Island Special Fund to be drawn on progressively to finance measures to facilitate resettlement. As the Act now stands the fund can only be used immediately prior to the Christmas Island Phosphate Commission ceasing to function. This fund is being built up by a levy on each ton of phosphate rock exported from the Island and now stands at approximately $2m. The Christmas Island Act will also be amended to enable young people on the Island who may now under that Act opt for Australian citizenship at 21 years, to opt from 16 years with parents’ consent. This would bring Christmas Island into line with

Australia, where young migrants may become Australian citizens at 16 years with parents’ consent.

These people have rendered a service to Australia by helping to operate an industry that has been and still is extremely valuable to Australia. The decisions are also in keeping with the spirit of an undertaking given in 1958, when Christmas Island was taken over by Australia, that any applications for entry to Australia by Asian residents of the Island would be given sympathetic consideration. The Australian Government accepts that it must look ahead to the time when the phosphate industry will cease to function and the Asian residents will no longer have a source of income on the Island. It is confident that by giving the Asian residents the opportunity to resettle off the Island in a planned, gradual way. the Government will be discharging Australia’s obligations towards these people and will be acting in their best interests. The Government for its part will be making every effort to ensure that resettlement proceeds smoothly without disruption to the phosphate industry or adverse effects on the people concerned. I am happy to say that this policy was endorsed by the former Government, and this ensures a bi-partisan approach to the human problems involved.


– by leave- The Opposition welcomes and agrees with the statement. As the Minister for External Territories (Mr Morrison) said in his concluding remarks, for which I thank him, this policy was endorsed by the former Government when I held the portfolio of External Territories. Therefore, I am pleased indeed to support the Minister’s statement today. The Minister’s statement is largely factual and I do not disagree with it at all. It is a recognition of the problems which will face the residents of Christmas Island as the phosphate deposits become exhausted. I regard the provision for health and character checks referred to as one aspect of the Minister’s statement as being essentially a control measure and not necessarily a means of excluding from entry to Australia applicants who might, as a consequence of the checks, be the subject of adverse reports.

In those cases where it is clear that Australia should should accept obligations for the resettlement of the persons concerned, entry will not be denied, should objection arise. provided arrangements can be made to safeguard the interests of the Australian community by the provision of suitable controls or supervision either prior to or following movement to Australia. The only matter I query is that it is my recollection - I have not been able to check this out - that the previous Government agreed that, in line with the Citizenship Act, young people who were on the island when Australia took responsibility on 1st October 1958 and who can now opt for Australian citizenship at 21 years should be allowed to opt at 16 years with parental consent. Not many would be in this category. Perhaps the Minister could advise me outside the chamber later regarding this small matter. I do not ask for it to be dealt with now.

There should be no significant problems associated with the Government’s decisions. The fact that the decisions have been formulated well in advance of the ultimate depletion of the island’s deposits will mean that with proper administration the best interests of the island residents should be served. From 1st January 1958 Christmas Island became a separate Crown colony until 1st October 1958 when it became a Territory of Australia by Acts of the British and Australian Parliaments. At infrequent intervals a number of correspondents offered the view that the Government of Australia, of whatever complexion, would face an embarrassing dilemma regarding the resettlement of residents of Christmas Island. This prediction has not been proved correct. The previous Government was prepared to deal with the matter in the only human and moral way possible. I express my thanks to my colleagues in the former Ministry who supported my view that this decision should be taken. This new Government is implementing our decision which, as the Minister kindly mentioned, we endorsed late last year. Naturally we support this action.

Sitting suspended from 6.12 to 8 p.m.

page 1442


Ministerial Statement

Minister for Transport and Minister for Civil Aviation · Newcastle · ALP

– by leave - The lives of all of us are constantly at risk each time we take to the roads, whether as motorists, cyclists or pedestrians. We have a wonderful but large country. We have over 5 million vehicles driving on more than half a million miles of roads.

We have almost 3 million school children, a considerable proportion of whom are cyclists. Finally all Australians, more than 13 million of us, spend part of our time as pedestrians. Given the geographical distribution of our population and industry, safe and efficient transport is the life blood of our economic and social well being. The Australian community devotes about 20 per cent of the resources available to it to the provision of transport services. Nevertheless we managed to kill some 3,400 fellow Australians on our roads last year. 1 am always deeply shocked when I hear of the terrible deaths and injuries we inflict on one another on our roads. I find little consolation in the fact that injury producing accidents - that is, those resulting in injuries which require medical attention - occur only once in every 750,000 vehicle miles. This means that the complex road transport system involving the vehicle, the road environment and the road user and his social environment is working with a fair degree of efficiency. However, we cannot ignore the fact that there were about 90,000 people injured last year in road accidents.

We have a mobile community and the realisation of the full potential of this great country will depend in large measure on retention of this mobility. The test is not whether we have with the benefit of compulsory seat belt wearing done better or worse than selected overseas countries; the test is whether we have done as well as we could. What troubles me most about all of this is that we do not mean to kill or maim our fellow Australians. Each tragedy is in this sense an accident but the accidents keep happening with frightening regularity.

There are 2 things which we must recognise. First, we are seeking a high degree of safety and efficiency in this complex road transport system and we will achieve this only by a sustained professional approach. Second, it is little use shrugging our shoulders and saying it is primarily a matter for the States. The States have been doing what they could in their own way but this has not been good enough. The time is long overdue for the Australian Government to give a strong lead and support to the States in this regard.

The Australian Government has decided that it must involve itself more directly in a more vigorous, co-ordinated and multi-disciplinary approach to road safety at the national level. The Australian Government has decided to do 5 main things. First, the toll on Australian roads is a national problem and as such warrants the urgent attention of this, the national Parliament. I will be moving for the reappointment of the Select Committee on Road Safety so that Parliament will be given an opportunity to play a full and proper part in developing policies in such vital areas as drinking and driving, speed, driver training and so on.

Second, we will undertake, in co-operation with the States, a program of improvements at those locations where accidents keep occurring for one reason or another. We are in the process of commissioning a survey of what needs to be done at these locations with poor accident records. I trust that the States will co-operate fully with us in this national survey so that it will serve as a sound basis for action by all levels of government. Third, a central information service is to be provided for all those who are working in road safety. This will be located in the Department of Transport in Canberra but its resources will be available to people throughout the nation. Not only will the information service cover the local road safety scene in depth but details will also t-e provided of the latest developments overseas, including the results of research undertaken *n other road safety conscious countries. Fourth, we are increasing the technical and other resources devoted to vehicle safety, traffic codes, education and publicity and road safety research. Perhaps members will be interested in some of the research projects which will make up our comprehensive program. Studies recently have been completed on a review of vehicle design requirements in relation to top speed, the dynamic testing of seat belts, and a review of truck and bus safety in relation to road safety. Projects currently being undertaken include a sociological study of drivers involved in serious accidents; effectiveness of Victorian seat belt wearing legislation; review of United States traffic court practices; effectiveness of defensive driving courses - feasibility study; driver behaviour at ‘stop’ and give way’ signs; effectiveness of Victorian 70 mph speed limit; improved seat belt design to increase acceptability: requirements for drivers’ forward field of view; survey of vehicle inspection schemes; and the effect of vehicle colour on accidents - study design.

Further studies are to be undertaken on the effects of severe penalties on road safety; effectiveness of licence suspension; sentencing of traffic offenders; company road safety schemes; road user behaviour as it relates to accidents; feasibility of evaluating the effectiveness of television films of driver error in accident-reduction; optimum licensing age; effectiveness of saturation publicity on television; improved seat belt design; study of injuries where seatbelts were worn; motor vehicle signalling systems; town planning guidelines for road safety guidelines for evaluating priority roads; local street traffic control; design of rural in-depth studies; Queensland accident and mileage study; and, New South Wales pedestrian accident study. From these facts it readily can be seen that there still is quite a field for road safety conscious people to investigate and to participate in.

Finally, honourable members will recall the comprehensive report by the Expert Group on Road Safety headed by Mr Justice Meares tabled in this House late last year. I have asked the members of the Expert Group to continue their efforts at least until the Select Committee has had a chance to report. The Expert Group has already proved itself with its national review of the road accident situation. Much of the research now being undertaken stems from recommendations by the Expert Group. 1 look forward to receiving further advice from the Expert Group, especially in the important fields of road safety information and research. The majority of our drivers are under 40 years of age. The greatest number of deaths and injuries occur to motorists under the age of 30 years. To say nothing of the loss in human terms, the nation simply cannot afford this continuing carnage among the very citizens on whom we rely to build an even better Australia in the decades ahead.


– by leave - 1 am glad that the Government has seen fit to reappoint the Select Committee on Road Safety. The new Committee will continue the work which was done by a similar Committee in the last Parliament - a Committee of which it was my privilege to be Chairman. When the House went into recess at the end of last year, the work of that Committee had not been completed, although we had taken a great deal of evidence both from Australians and from overseas experts. I believe that there are few more important issues than the matter of road safety, when one considers the size of the road toll in Australia. As the Minister for

Transport (Mr Charles Jones) said, over 3,000 people are killed and 80,000 to 90,000 injured annually. Some of those who were injured probably are a great deal worse off than those who were killed. I say this because of the degree of physical and mental incapacity that many suffer as a result of road accidents. The road toll is the No. 3 killer of Australians, the others being heart disease and cancer. I am appalled that members of the public apparently are reconciled to the present road toll. They seem to regard it as inevitable. At the conclusion of each weekend they take up their newspapers, read the football results and the racing results then turn to see how many people have been killed on Australian roads. They then put the matter out of their minds until the following weekend when they look to see what the score is for that weekend.

There is no simple answer to the major causes of road accidents. There is no simple answer to what we can best do to reduce them. The losses caused by road accidents are colossal both in economic terms and in terms of human suffering, which is immeasurable. The demand for hospital beds for victims of road accidents must adversely affect the health of persons who cannot be admitted to hospital immediately for treatment which they require because of the demand on beds created by road accidents. The tragic part of the story is that a big percentage of road accidents could be avoided. If drivers were less selfish, less aggressive and less thoughtless and more responsible, more careful and more considerate of others many homes would not be mourning the loss of parents or children. What are a few minutes in the lives of motorists when because of reckless driving more than 3,000 die and 80,000 are injured every year? Such a road tol) would not be tolerated in time of war, so I do not know why we should tolerate it in time of peace.

To the extent that the re-establishment of this Road Safety Committee of this Parliament may contribute to ascertaining the causes of road accidents and to reducing both their number and the suffering caused by them it is a matter of major importance. I commend the Government for taking the action it is now taking-


– by leave- I shall be reasonably brief. I commend the Minister for Transport (Mr Charles Jones) on the statement he has made and the Government on re constituting the Select Committee on Road Safety. I pay a tribute to the committee which existed until the end of the last Parliament. It was headed by the previous speaker, the honourable member for Henty (Mr Fox). It was a very good committee which operated in the interests of Australia and those persons whom the Parliament is trying to protect. The chairman of that committee did a good job and all members of the committee got on well. Unfortunately the committee was constituted rather late in the Parliament and had only begun functioning when its members were involved in the elections. However in the short space of time available to the committee it heard numerous submissions. I pay a tribute, too, to Dr Solomon, the former member for Dennison who, fortunately for us, but unfortunately for the Liberal Party, will not be available as a member of the reconstituted committee. He made quite a contribution to the former committee.

No-one would disagree with what the honourable member for Henty said, but because all honourable members are in agreement on the question of death and injury on the roads it is wrong for people to think that that we do not feel strongly and emotionally about it. I recall reading what one prominent writer - I believe it was Max Walsh of the Financial Review’ - wrote, namely, that road safety usually had an eye-glazing effect upon politicians and the public. The honourable member for Henty was right in saying that there has been a too ready acceptance that 3,500 to 4,000 people will be killed and 20,000 injured each year as the price we have to pay in a modern and affluent society. I stress the matter of injuries. People tend to think that if a person finishes up a paraplegic or punch-drunk as a result of an accident he is not really a victim. People forget that although 3,500 to 4,000 are killed, which is a dreadful figure, 20,000 are injured. 1 doubt whether there is any honourable member in this chamber who has not had a relative or friend seriously injured or killed, probably annually. I would be interested to know whether any honourable members have not been injured in an accident. I know that the honourable member for Macquarie (Mr Luchetti) is lucky to be with us tonight.

Mr Luchetti:

– The nation is lucky too.


– Yes, but more importantly I think the honourable member was concerned about himself. Until recently there has been a general feeling that we must accept that nothing can be done about the situation. What the Minister has done in outlining many of the surveys which are now being undertaken is to show just what can be done if we have the wit, the will and are prepared to make the initial financial contribution to help in seeking out answers to these problems.

One matter that concerned me last year was that with the introduction of a law requiring the compulsory wearing of seat belts there was a real drop in the number of road deaths. Compared with the previous year there was a 13 per cent drop throughout the nation. If one takes into consideration the increased number of vehicles and drivers the percentage would be much higher. However because there was a reduction in the road toll people thought that at last we were getting on top of the problem and there was a tendency to neglect many other safety features. I have said many times in this chamber that I believe there are 2 important things that must be done. First, there must be built a safer package into which to put drivers and passengers. The present motor vehicle is not designed to withstand crashes at speeds exceeding 15 to 20 miles an hour. With about 5 million cars on our roads we must learn to package people properly. Secondly, we must provide an environment in which a vehicle can travel properly. I do not think any honourable member would disagree with me when I say that our present road system is primitive in the extreme. It was never designed for what it is now carrying.

I hope that the reconstituted committee will make strong recommendations to the Government on these matters and that the Government will take notice of those recommendations. Recently I had the most heartrending job of calling on a friend to offer him my condolences because his 7-year-old son had been killed as a pedestrian. Too often we forget the pedestrians, yet they represent 25 per cent of the number killed on our roads. I hope that I do not have this experience too often. My friend said that nothing could have been done - that the accident was something about which nothing could have been done. At that time I did not feel like pushing the point and discussing with him the fact that an enormous amount can be done for pedestrians. In the next 25 years we will be building more houses and more communities than have been built in the past 150 years. Modern town planning methods, if applied, can eliminate the present cross-flow of vehicular with pedestrian traffic. We must design our new communities to be as free as possible of danger to pedestrians. I look forward to the work of the Select Committee. I make the point to the Minister that although the Committee is set up to make an ultimate report I am wondering whether it would be possible for it to bring out interim reports as it deals with each subject.

Mr Charles Jones:

– I will be asking you to bring down an interim report very early.


– I am delighted. Ministers and departments will tend to say: ‘We must not do anything until the Select Committee has brought out its report’. It could take 1 8 months or 2 years for the final report to come out. Within a week it is buried. In the meantime, hundreds of things could be done. Probably each honourable member could think of about 50 steps that could be taken to contribute towards the saving of lives. We must compile a list of priorities in finding measures that will be the cheapest and the most acceptable in the community. The introduction of seat belts was not costly and was acceptable to the community. In 101 things that can be done are vehicle design, road design, treatment of alcoholism, lighting and data collection. I hope that we will be able to bring out an interim report every month or two so that moves can be instituted and lives saved as soon as possible.

page 1445


Minister for Transport and Minister for Civil Aviation · Newcastle · ALP

– I move:

  1. That a Select Committee be appointed to inquire into and report on -

    1. the main causes of the present high level of the road toll in Australia;
    2. the most effective means of achieving greater road safety in Australia;
    3. the particular aspects of the problem to which those concerned with road safety could most advantageously direct their efforts, and
    4. the economic cost to the community of road accidents in Australia in terms of -
    5. material damage;
    1. loss of man hours and earning capacity, and
    2. cost of treatment of accident victims.
  2. That the committee recognise the responsibility of the States in these matters and seek their cooperation in all relevant aspects.
  3. That the committee consist of 7 members, 4 to be nominated by the Prime Minister, 2 to be nominated by the Leader of the Opposition and one to be nominated by the Leader of the Australian Country Party.
  4. That every nomination of a member of the committee be forthwith notified in writing to the Speaker. (.5) That the Prime Minister nominate one of the Government members of the committee as Chairman.
  5. That the Chairman of the committee may, from time to lime, appoint another member of the committee to be the Deputy Chairman of the committee, and that the member so appointed act as Chairman of the committee at any time when the Chairman is not present at a meeting of the committee.

    1. That the committee have power to appoint subcommittees consisting of 3 of its members, and refer to any such sub-committee any matters which the committee is empowered to examine.
  6. That 3 members of the committee constitute a quorum of the committee, and 2 members of a subcommittee constitute a quorum of that subcommittee.
  7. That the committee or any sub-committee have power to send for persons, papers and records, to move from place to place, and to sit during any recess or adjournment.
  8. That the committee have power to authorise publication of any evidence given before it and any document presented to it.
  9. That the committee or any sub-committee have power to consider and make use of the minutes of evidence and records of the Select Committee on Road Safety appointed during the Twenty-seventh Parliament.
  10. That recourse to technical and/or expert advice by the committee shall be subject to approval of the Speaker.
  11. That the committee have leave to report from time to time and that any member of the committee have power to add a protest or dissent to any report.
  12. That the foregoing provisions of this resolution, so far as they are inconsistent with the standing orders, have effect notwithstanding anything contained in the standing orders.

Honourable members will recall that a Select Committee on Road Safety was established by this House during the last Parliament. It was given very broad terms of reference but, in the event, it was unable to report. Much useful evidence was taken but it was not possible to hear from all the people working in road safety who wished to appear. The Committee also did not have an opportunity to consider the report of the expert group on road safety which was tabled late last year. The report is a national review of the road accident situation in Australia. The road toll is a national problem and warrants the urgent attention of the national Parliament. In moving for the reappointment of the Select Committee on Road Safety I make an earnest request to members of this House to assist me in developing effective measures to make our roads safer for all Australians. I commend the motion to honourable members.

Mr N H Bowen:

– The Opposition supports the appointment of the Select Committee on Road Safety. As the Minister for Transport (Mr Charles Jones) has indicated, the previous Government appointed a select committee on road safety last year. It operated for a short period. We favour the reappointment of the Committee. We will support it and join in its work. The problems of road safety are enormously difficult. They face each of us day by day. We are all conscious of them, so much so that as has been mentioned we seem to come to accept the inevitability of injuries and deaths on the roads. The Government can be assured” that whatever support is needed for this type of inquiry will be given by the Opposition. Subject to the measures which flow from the recommendations being consistent with the position of this Parliament and co-operation with the States, and being in the interests of the people, as I believe they will, they will have the support of this side of the House. I also commend the motion.

Question resolved in the affirmative.

page 1446


Minister for the Environment and Conservation · Maribyrnong · ALP

– I seek leave to amend paragraph 1, in the terms that have been circulated, of the notice of motion to appoint a Joint Committee on the Environment and Conservation.


-Is leave granted? There being no objection, leave is granted.


– I move:

  1. That a Joint Committee be appointed to inquire into and report on -

    1. environmental aspects of legislative and administrative measures which ought to be taken in order to ensure the wise and effective management of the Australian environment and of Australia’s natural resources and
    2. such other matters relating to the environment and conservation and the management of Australia’s natural resources as are referred to it by-
    1. the Minister for the Environment and Conservation, or
    2. resolution of either House of the Parliament.
  2. That the Committee recognise the responsibility of the States in these matters and seek their cooperation in all relevant aspects.
  3. That the committee consist of four members of the House of Representatives nominated by the Prime Minister, two members of the House of Representatives nominated by the Leader of the Opposition in the House of Representatives, one member of the House of Representatives nominated by the Leader of the Australian Country Party in the House of Representatives, two Senators nominated by the Leader of the Government in the Senate and two Senators nominated by the Leader of the Opposition in the Senate.
  4. That every nomination of a member of the committee be forthwith notified in writing to the President of the Senate and the Speaker of the House of Representatives.
  5. That the members of the committee hold office as a joint committee until the House of Representatives expires by dissolution or effluxion of time.
  6. That the Prime Minister nominate one of the government members of the committee as Chairman.
  7. That the Chairman of the committee may, from time to time, appoint another member of the committee to be the Deputy Chairman of the committee, and that the member so appointed act as Chairman of the committee at any time when the Chairman is not present at a meeting of the committee.
  8. That the committee have power to appoint subcommittees consisting of three or more of its members and to refer to any such sub-committee any of the matters which the committee is empowered to examine.
  9. That the committee have power to send for persons, papers and records, to move from place to place and to sit during any recess or adjournment of the Parliament.
  10. That the committee have leave to report from time to time and that any member of the committee have power to add a protest or dissent to any report.
  11. That the committee may proceed to the dispatch of business notwithstanding that all members of the committee have not been appointed and notwithstanding any vacancy on the committee.
  12. That five members of the committee constitute a quorum of the committee, and a majority of the members of a sub-committee constitute a quorum of that sub-committee.
  13. That in matters of procedure the Chairman or Deputy Chairman presiding at the meeting have a deliberative vote and, in the event of an equality of voting, have a casting vote, and that, in other matters, the Chairman or Deputy Chairman have a deliberative vote only.
  14. That the committee be provided with all necessary staff, facilities and resources.
  15. That the foregoing provisions of this resolution, so far as they are inconsistent with the standing orders have effect notwithstanding anything contained in the standing orders.
  16. That a message be sent to the Senate acquainting it of this resolution and requesting that it concur and take action accordingly.

Select committees of both Houses, concentrating on environmental issues, have performed a valuable service to both the Parliament and the people of Australia in recent years. I am thinking in particular of the Senate Select Committee on Water Pollution, the Senate Select Committee on Air Pollution and the House of Representatives Select Committees on Aircraft Noise and Wildlife Conservation. The purpose of this motion is to ensure that the Parliament, through both its Houses, is able to continue, and build upon, the precedents established by these committees. It is proposed that this be achieved by the establishment of a Joint Standing Committee on the Environment. The use of a Standing Committee rather than a series of select committees should facilitate the timely consideration of environmental issues as they arise, thereby strengthening Parliament’s role in this area.

It will be recalled that the report of the House of Representatives Select Committee on Wildlife Conservation recommended that a Standing Committee of the House of Representatives be. established in the new Parliament with powers to inquire into matters of environmental and conservation concern referred to it by the House. This recommendation would, in effect, be implemented by the establishment of the Committee I am proposing, the only difference being, of course, that it is now proposed as a committee on which both Houses are represented.

In moving for the establishment of this Committee I am conscious of the great many environmental problems that must be both faced and solved if the future citizens of this country are to enjoy the kind of life that so many of us take for granted. They are problems that have far too often in the past been pushed aside or neglected as we have pressed for immediate benefits without regard to the longer term consequences of our actions, or to the kind of country we are creating for our descendants. These problems are so numerous and so important for this country that I cannot conceive of a situation in which the Parliament would not wish to be fully involved in their consideration and their solution. A Joint Standing Committee on the Environment would, in my view, provide a most effective means of providing for the full involvement of Parliament in this field. As the first Minister for the Environment and Conservation it gives me pleasure to commend this motion to the House.

Mr N H Bowen:

– The Opposition does not oppose the motion as amended for the appointment of a

Joint Committee on the Environment and Conservation. The question of the environment involves difficulties, and the more inquiry there can be in a central way, the more information that is given to members of Parliament and the more experience gained from listening to experts that we have, the better it will be. When I was Minister for Education and Science I took up this whole question with the Commonwealth Scientific and Industrial Research Organisation. At that time it had about 38 divisions with a chief at the head of each division. At that time 25 of the divisions were separately concerned with particular matters affecting the environment. My first thought was that it might be a good idea to combine them all in one central organisation, all of them working to the same end.

I met some difficulties because the people dealing with particular problems in the Wildlife Division were working amongst people who had the same disciplines and expertise that they had. The people working in the marine science field were working with those who had expertise and experience in the marine science field. There was no point in taking one man from each group, putting them together and expecting that they would necessarily produce a better result than if they proceeded initially in their separate ways. Even to this time they are proceeding in their own disciplines. However, overall direction is necessary. We perhaps have something to learn from the experience in the United States of America and Canada in this matter. I recall talking to the chairman of the council of advisers to the President on this subject, Mr Russell Train, who is backed up by a first class scientist, Dr McDonald, in Washington. He looked at all federal submissions to see their effect on the environment and in effect made an impact statement. In addition to that they were then setting up something that we do not have here, a department of protection of the environment under a Mr Ruckelshaus, who was taken from the Attorney-General’s Department. He was a young lawyer in his thirties who was setting up this department with about 16,000 officers to police the enforcement of all environmental laws throughout America. Prime Minister Trudeau also had similar types of advisers.

Our own problems, of course, are somewhat different from theirs, but there is no question about the need for a national approach as well as a local approach to these problems. The major responsibility up to the present time has rested with the State governments. I have had particularly close association with the New South Wales Government in relation to the environment in my own electorate, particularly as it affects the Parramatta River. Some members of the House may recall that at one stage the City of Parramatta was larger than the City of Sydney at the time of early settlement. The people of Parramatta used to refer to Sydney as their port, and of course they used to travel up the Parramatta by ship. But it is getting a bit thick towards the western end of the Parramatta River and I had been endeavouring to persuade scientists to come in and and do a test and make recommendations. But in point of fact, the Minister for the Environment in New South Wales, Mr Beale, and the Minister for Health, Mr Jago, both of whom have responsibilities in this area, had in fact done considerable studies on the river and they received the co-operation of business to a considerable degree. Millions of dollars have been spent in re-cycling water so that it does not go back into the river. This money has been spent at the Shell plant and other plants along the river, the fish are gradually coming back to the west of the Ryde Bridge. This is just one problem. I see another honourable member sitting opposite who has almost equally great problems in his electorate.

The Opposition will co-operate with this committee. I make only one comment on the form of it. It is a comment I have made before about committees. I notice that paragraph 6 of the motion provides that the Prime Minister will nominate one of the Government members as Chairman of the Committee. Naturally we do not object to the Government side having a majority on this Committee, but we think that House committees and joint committees should appoint their own chairmen; they should not even appear to be appointed by the Executive. It may produce the same result, but it is a matter of form that this House and all of us in the House of Representatives and in the Senate ought to insist on. I would ask again that in bringing forward joint committees the procedure be followed of eliminating the provision contained in paragraph 6 of this motion and providing for the appointment of the chairman by the committee itself.


– I commend the Minister for the Environment and Conservation (Dr Cass) and the Government for moving for the establishment of this Committee. Again it will more or less take over from a select committee of the last Parliament which it was my privilege to chair. I pay a tribute to all members of that Committee. It was a very dedicated Committee comprising members from the 3 parties represented in this House. I would like to think that we achieved something worth while. One of the recommendations made by that Committee when it tabled its report was that the Parliament should establish a standing committee to which controversial matters could be referred, and I see a great deal of value in this. Some of them that come to mind quickly are Lake Pedder, Cooloola Sands and the wood chip industry, just to name 3 of them. If it is a committee of this Parliament to which the Government can refer its controversial matters it could and should take a great deal of pressure off the Government, because it can look at these matters impartially and on their own merits.

I believe that in Australia we have a chance to learn from some of the mistakes which have been made by other countries. There is a very good reason why very many more people are conscious of pollution of the environment now than there were 5 or 6 years ago. The world population is doubling every 35 years. People themselves mean pollution because people must have factories to provide their requirements. These factories have been discharging pollution into the rivers and streams; they have been pouring smoke into the air. We are destroying fields and trees to put down roads to accommodate the motor vehicles which, too, are causing pollution. As the population of the world increases very rapidly we have to be conscious of the fact that we are making an environment that will be there for generations to come. People are entitled to live in a clean environment, but if they want to live in a clean environment they ought to be prepared to pay for it. If this means that we have to require industry to spend more money on up-to-date equipment to eliminate or reduce pollution and this means an increase in the price of goods, people have to be prepared to pay for it. ‘

One can travel hundreds or even a thousand miles or more in this country, and one can even go out into the outback 100 miles from Alice Springs and find roads and areas where no roads exist which are cluttered with bottles, non-degradable containers and cans. There are countries in which laws have been passed to make it an offence to sell something in a non-returnable container. Other countries are a great deal stricter with regard to people who throw their rubbish out on to the roads. I believe that a committee such as has been set up could act as a watchdog for a clean environment. I am all in favour of it. I hope I am fortunate enough to become a member of it.

Question resolved in the affirmative.

page 1449



-I have received the following message from the Senate:

Mr Speaker,

The Senate having considered Message No. 22 of the House of Representatives has agreed to the following resolution in connection therewith, viz.:

That the Senate concurs in the Resolution transmitted to the Senate by Message No. 22 of the House of Representatives relating to the appointment of a Joint Committee to examine and report on Certain Matters Relating to Prices, subject to the following modifications -

paragraph (1), sub-paragraph (a), after the words ‘private industry’ add ‘and by the public sector’,

paragraph (1), sub-paragraph (b), after the words ‘private industry’ add ‘and the public sector’,

paragraph (2), at end of paragraph add ‘and one Senator nominated by the Leader of the Australian Country Party in the Senate*.

That the provisions of that Resolution, so far as they are inconsistent with the Standing Orders, have effect notwithstanding anything contained in the Standing Orders.

The Senate requests the concurrence of the House of Representatives in the Senate’s modifications of the Resolution transmitted to the Senate by the House.

Motion (by Mr Crean) agreed to:

That the message be taken into consideration forthwith.

Treasurer · Melbourne Ports · ALP

– I move:

I do this for reasons that I now want to explain. We are so serious that this committee should be established that we do not want any hindrance to it. When the measure was before the House in its original form our argument about not having what are called public sector items considered was that public sector items are subject to parliamentary scrutiny in any case. After all, one cannot alter postal or telephone charges in this House unless they are subject to some degree of public examination. The same applies in the States. For example, the tariffs of the State Electricity Commission of Victoria or the Gas and Fuel Corporation of Victoria cannot be altered unless the proposals come before the State Parliament. It is a combination of the Opposition parties and the Democratic Labor Party in the Senate which has resulted in these amendments and the Government bows to the inevitable on occasions. The Government is serious about this matter. It believes that there is wide and very considerable concern about prices generally and something has to be done. This committee on prices is part of that mechanism and rather than hinder the passage of the motion the Government is prepared to accede to the request of the Senate.

The second matter that is requested by the Senate is that a member of the Australian Country Party in the Senate be added to the Committee. The Government has no objection to that. It alters the number on the Committee from 10 to 11 members and makes the representation from this House 6 and from the other place 5, and will give the Government 6 members to 5 from the other parties. I hope it is accepted that we are yielding slightly on our position. The Government takes the matter so seriously that it does not want to haggle again. The honourable member for Parramatta (Mr N. H. Bowen) moved in this place the same amendment as we are now accepting from the Senate, namely, that the public sector–

Mr N H Bowen:

– No. I did not move this amendment. ButI was aware of it.


– He was aware of it in any case. What the Government is seeking to do is look at the price makers who are not at the moment subject to any kind of public scrutiny. That was the purpose of the Committee. If the Opposition chooses to suggest that public pricing which, after all, is public pricing and subject to certain kinds of scrutiny already, should be included in the terms of reference of the Committee, the Government will yield on the point of order to let the Committee be established because it regards the Committee as a central part of a definitive attack on prices. I do not want to dwell any more upon it. The Government regards this Committee as one of 3 parts of what it regards as the central mechanism for grappling with this very important problem. We have yet to bring in legislation in respect of the proposed prices justification tribunal. This joint committee on prices is to be a sounding board between the public and the Parliament and may result in action being taken following its recommendations.

I regard as the third part of the central mechanism the strengthening of consumer protection arrangements through co-operation between the States and Commonwealth. As honourable members know, there is to be a meeting of the State Premiers and the Federal Government about this central problem. It was originally called for 4th May but I understand that because of certain technical difficulties in the States it is now to be held a week later. The Government is prepared to accept the amendment moved in the Senate in order that there will be no hindrance to the establishment of this Committee. We are prepared to accept the second part of the request that there be an additional member from the Country Party in the Senate appointed to the Committee. This will mean that the constitution of the Committee will be 11 members instead of 10 with 6 from this House and 5 from the Senate. The Government will have 6 members on the Committee’ and the Opposition will have 5. I hope that this again will be accepted as evidence of the Government’s bona fides in taking this matter very seriously. It does not want politics; it wants action.

Mr N H Bowen:

– I am glad to hear the Treasurer (Mr Crean) say that he will accept these modifications. That, as it were, disposes of the substance of the matter. These modifications have come back from the Senate as a request to this House. The Opposition moved similar amendments in this House when the motion to set up this Committee was before us but at that point they were not accepted. In view of what the Treasurer has said I think I should mention 2 matters. Firstly, and this is not a matter to spend much time on, the Government still has a majority on the Committee. I can understand the honourable senators feeling that they needed that further representation, giving the Government a majority of one instead of a majority of 2. I do not think anything turns on this. The chairmanship is with a Govenment representative.

However, on the question of the addition of prices in the public sector to the terms of reference of the Committee, while it is true that prices in the public sector in many respects are subject to scrutiny either in a State Parliament or in this Parliament, whether in respect of railway fares, the cost of postage, or other public prices, it is also true to say that for the purposes of a prices justification tribunal or a committee of this Parliament looking at the level of prices, the 2 are interrelated. There is a relationship and an influence both ways between the 2 kinds of prices. I think a substantial argument can be advanced that it is necessary that the Committee should at least have the power to consider prices in the public as well as the private sector. That is not looking at prices in the community in a one-eyed fashion. It is looking at them with both eyes open. The second point I make is that the public sector prices are liable to come before various Parliaments in various ways - some in regulations, some in statutes, some before State Parliaments and some before the Commonwealth Parliament and there is no concert necessarily among all the authorities which fix public prices. Therefore, there is a matter of substance involved here and it may be that this Committee will be able to give some advice from time to time which may prove to be useful. Whether the Government will accept it or not is a matter for the Government when it sees the recommendations of the Committee and the reasons for them. I do not put it beyond the bounds of possibility that the Committee, if it does have the power, may find that there are areas in the public sector which are out of line or which have an impact on prices in a way that is troubling it in respect of its recommendations on private prices. Therefore, I am very glad to hear the Treasurer accept the modifications requested by the Senate.

Question resolved in the affirmative.

page 1451


Mr McKenzie:
Diamond Valley · ALP

-I present the Second Report of the Publications Committee.

Report - by leave - adopted.

page 1451


The following Bills were returned from the Senate:

Without amendment -

Public Service Bill 1973.

States Grants (Aboriginal Advancement) Bill 1973.

Excise Bill 1973.

Papua New Guinea Loan (Asian Development Bank) Bill 1973.

Without requests -

Excise Tariff Bill (No. 2) 1973.

page 1451


In Committee

Proposed new clause 1 6.

Consideration resumed from 11 April (vide page 1349), on motion by Mr Wentworth.

After clause 15 add the following new clause: 16. (1) Where the Director-General is satisfiedthat a person has become resident in Australia solely or mainly for the purpose of establishing eligibility for a pension, he may determine that some or all of any pension for whichthat person has become eligible should not be paid while that person is absent from Australia.

Proposed new clause negatived.

Remainder of Bill - by leave - taken as a whole, and agreed to.

Bill reported without amendment; report adopted.

Third Reading

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

page 1451


Second Reading

Debate resumed from 5 April (vide page 1 1 52), on motion by Mr Barnard:

That the Bill be now read a second time.


-I support the Bill. I have no desire to oppose its passage through this House unnecessarily. I will not oppose any legislation that will benefit our servicemen or ex-servicemen. This legislation which seeks to allow service pensioners the right to receive their pension in whatever country they wish to reside in commendable and in my opinion is no more than they deserve. The arrangement whereby any former resident at present living overseas and who returns to Australia may receive the Service pension, provided he is eligible and provided he resides in Australia for 12 months after returning, causes me a small doubt as this could possibly be loosely applied and this could lead to abuse of the benefit. I sincerely trust that the Government will watch closely this provision in the legislation to avoid any such possibility. The provision in this legislation which gives the ex-serviceman the same rights as would be available to him if he resided in Australia, as I have said before is to be commended, for this in some small part shows that the ex-serviceman is recognised for the service that he gave to this country and that this service is appreciated. As I have said, I have no desire to delay this Bill. Accordingly I support it.

Minister for Aboriginal Affairs · Wills · ALP

– It is an occasion in these troublesome times to find that honourable members opposite are in complete agreement with this proposal. As the honourable member for Bendigo (Mr Bourchier) pointed out, this is a relatively small piece of legislation but there is an important principle embodied in it. For many years there has been conducted a campaign that those people who are entitled to Australian pensions should be able to draw them wherever they are living. As far as repatriation pensions are concerned, it has always been a part of the principle that they are absolutely inalienable and therefore the ordinary repatriation pension has for a good many years been payable irrespective of the country of residence of the beneficiary. We are now proposing to transfer this right to those people who happen to be in receipt of Service pensions. Therefore we are accepting the general principle applied under the Repatriation Act for all other repatriation beneficiaries.

But it seems to me that on an occasion such as this - and we discussed this question under the latest Social Services Bill too - that there are several important principles involved. My own view is that once an Australian always an Australian. The fact that a person is born in this country ought to give him some entitlement no matter where he goes, no matter what he does, no matter how long he is away from this country and that ought to be part of the general acceptance of our citizenship and rights. Therefore those rights which flow to a person while he is resi dent in this country ought in ordinary circumstances apply when he is away from this country.

We are approaching more rapidly to a state of what one might call one world when the barriers between humanity are falling down; people travel more, they live more freely in other parts of the world and they are away from home for longer periods. I think this is another important principle. I do not suppose that the proposal in this legislation will cost all that much. How many repatriation beneficiaries in this category are absent from Australia for such a length of time that they would need to draw their pensions overseas is unknown. It might be only a handful. I dp not believe that this Parliament should ever abdicate its responsibility to legislate because there are only a few beneficiaries but in this instance I believe that there is an important principle involved and I am glad that we have been able to bring forward some legislation at this stage with which honourable members opposite are in complete agreement. I hope that when we turn our attention more fully, to the repatriation system and approach it with a much more liberal minded attitude than has been the case in the past, we really will give the system a thoroughly modernised program and get such unqualified support from our friends opposite.

Mr N H Bowen:

– How is the inquiry progressing? ‘


– It is still progressing


– This is one of the few occasions on which I can agree with the Minister for Aboriginal Affairs (Mr Bryant). He said that this is not an important piece of legislation so far as changing the whole of the Australian economy is concerned. I agree with the Minister in saying that it is a matter of principle and of doing something for certain people, irrespective of how few they may be. I suppose it would be almost impossible for anyone to find out the exact number of people who would be affected by this legislation. In a nutshell this Bill means that Service pensioners and other means test pensioners such as widowed mothers and the aged parents of deceased exservicemen will be entitled to continue to receive their pensions under the Repatriation Act if they leave Australia. I believe that this is very important because as far as Service pensioners and other eligible pensioners are concerned they are entitled to receive this privilege, if I may express it in that way, irrespective of where they may be residing.

I wish to explain who are Service pensioners. I am sure many other honourable members in this House have found that there is confusion about the nature of the Service pension. Over a period of time I have had numerous people come to me and start talking about certain types of pensions. They do not realise the difference between the age pension, the Service pension and repatriation pensions. Indeed I have even had people come to me, because I happen to be a member of a Legacy club, and say they wanted a Legacy pension. Of course there is no such thing. I want to point out the difference between the various pensions. A Service pension is granted by the Repatriation Department but it is not on the same basis as a repatriation pension. A repatriation pension is granted to persons who suffer disabilities that have been accepted as due to war service, whereas a service pension, which is similar to the age pension, is granted to ex-service personnel on reaching the age of 60 in lieu of 65, which is the qualifying age for the age pension. That is basically the difference between the 3 different pensions.

I notice in the second reading speech that the Minister for Defence (Mr Barnard) has given consideration to the question of supplementary assistance. I agree entirely with the decision that an individual should lose his eligibility to receive supplementary assistance when he leaves the country; but I note that the legislation provides that an ex-serviceman’s wife who remains in the country while her husband leaves will be entitled to this assistance. I also agree with what the Government proposes to do in regard to the question of the returnee - in other words those personnel who have elected to live outside of our country but who think that by returning to Australia for a short period, perhaps a few days, they could qualify for the pension. I agree that a benefit should not be granted in such circumstances. There are many and varied reasons why an ex-serviceman from the Australian forces would want to live overseas; this is a matter for his own personal judgment. But it would not be right for such a person to return to Australia just for the purpose of receiving a pension and then to move off again. ; I want to raise a’ few other points in relation to this matter. One concerns the transfer of a social security pension to a Service pension, or vice versa. As I said at the outset the costs in this connection are unknown. There are a few other matters to which one could also refer to at this stage. Without wandering from the Bill to any degree I want to draw the attention of the House to that part of the policy speech of the Prime Minister (Mr Whitlam) where he said he would raise the various rates of these pensions - that is totally and permanently incapacity pensions, Service pensions and the like. The Prime Minister said that the TPI rate would be based on 100 per cent of the minimum wage. This promise has been carried out and I congratulate the Government for doing so. But the Prime Minister also said that the 100 per cent rate pension would be 50 per cent of the minimum wage. At the present time this is not the case. I would like to know why.

The Prime Minister went on to say that other rates and allowances would be adjusted proportionally. Again this has not yet taken place. I want to know what has happened. I want to know whether the Government will take immediate action, shelve its proposals or just completely forget about them. I want to know these things, just as many other members on this side of the House want to know them. I ask the Minister for Defence (Mr Barnard) who is sitting at the table to place the points just expressed before the Minister concerned because I think it is very important that if a particular party at election time makes a promise and does not fulfil that promise the people have a right to know why the promise has not been fulfilled.

I plead with the Minister for Defence to suggest to the Minister for Repatriation (Senator Bishop) that he make a clear cut statement indicating the intentions. I know that Rome was not built in a day. I do not expect that all the legislation containing the promises made by the Government could be introduced overnight. But because we have made a start on matters dealing with repatriation legislation I would like to know why we cannot go a little further. In view of the circumstances that are prevailing in this House at present due to issues that have taken place outside, I conclude my remarks by saying that I support the Bill wholeheartedly. I congratulate the Government on the step ‘ that it has taken so far and hope that it will be able to continue to fulfil the promises that it made at the last election.

Question resolved in the affirmative.

Bill read a second time.

Third Reading

Leave granted for third reading to be moved forthwith.

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

page 1454


Minister for Services and Property · Grayndler · ALP

– by leave - There has been considerable doubt today as to whether members of the House might be able to reach their destinations when they leave this place this week because of uncertain travel arrangements. I understand that the transport arrangements in fact will be normal tomorrow. However, because a number of members had made arrangements earlier tonight in view of the uncertain circumstances, the House will adjourn at 9.45 p.m. tonight so that those members can fulfil obligations entered into with aircraft companies and others in regard to transport. I hope that the House will approve of this arrangement without debate because it is one that was entered into in good faith. Whilst this course of action would otherwise not now have been necessary we should appreciate that members have booked out of hotels and so on. So I think it is necessary that the House should adjourn at 9.45 p.m. Having said so much, I hope that honourable members opposite will remember kindly in later days the action we are taking now because we might be in more troublous circumstances then.

page 1454


Second Reading

Debate resumed from 14 March (vide page 555), on motion by Mr Les Johnson:

That the Bill be now read a second time.


– The Opposition does not propose to stand in the way of the provision of funds to the States and therefore it will not oppose the Bill. But we feel that there are many matters of importance that should be mentioned. This Bill will provide loans to the States to the value of $6,550,000 at an interest rate of 4 per cent over a period of 53 years, payable annually. The States must build or commence to build, buy or renovate by the 1st July this year. Properties acquired or built in this way will be available for leasing only and will be allocated only to approved people who are certified by the State concerned to be in need. A further provision of the Bill is that the program must not interfere with other State expenditure for housing. I think these are the principal features of the Bill.

The Bill provides for a short term, crash program. The States are to be allowed only a short period of 2i months to complete the program, and I do not know how they are going to do it. The money provided under this legislation will not mean very much to each State. I have worked out that, the loans will allow the building of about 332 to 350 homes. I have calculated that on a State basis the approximate number of homes provided will be as follows: New South Wales 175, Victoria 75, Queensland 19, South Australia 26, Western Australia 21 and Tasmania 16. So this is not a big program.

I must say that the Minister for Housing (Mr Les Johnson) is a most enthusiastic Minister and I applaud him for that enthusiasm. But I warn him that he should not put his little hot fingers too rauch into the State pies because he is likely to get them burnt if he carries On in the present way. I look upon this measure more as a propaganda stunt than of real value to deal with the problem of housing. As I see it there are several real dangers. In the first place the time factor makes it virtually impossible for any State to meet the requirements. This part of the legislation creates a sort of panic operation to build or buy, and this is not a very appropriate time to be doing either. Also, the inclusion of the interest rate at 4 per cent creates a precedent, and I do not know how the Minister arrived at this figure. It is a subsidy to the States which is difficult to maintain in other legislation. If that were done, the amount of costs could be prodigious. It is a further spur to inflation and I believe it has the tendency to increase the cost of construction and/ or the cost of purchase.

It may be of interest to the Minister to know - I say this authoritatively - that the real estate agents in Australia today are having the greatest picnic they have ever had. There are more buyers than there is property to sell. As a result, prices are going up. This is real inflation. Today prices are reaching figures that have been unheard of. Recently a very good block of land at Northbridge in Sydney was sold for the sum of $134,000.

People are realising that we are running into a period of inflation. Even though there may be a collapse in real estate at a later date - that is on the cards - they realise that their money is safer in real estate than in any other kind of investment. Therefore, all over Australia money is being put into real estate. I believe that, unfortunately, this Bill will have the effect of interfering with and jeopardising the current State programs. I like the Minister and I think that he is a great enthusiast but he. has a mania for government ownership and control of houses.

Mr Les Johnson:

– I never knew you cared.


– That is right, 1 do not think he would deny it. He is a dedicated socialist to the nth degree and all his thinking and policy is directed to that end. He wants to build bigger and better housing commissions in each State, all controlled from Canberra. That is his idea. He does not really believe in home ownership. 1 have spoken about this for many years and have charged him with it. Now he is actually putting it into practice. He does not believe in the encouragement of little capitalists. In other words, he is a true disciple of Mr Dedman who made the famous remark that we do not want to build a nation of little capitalists. 1 suspect that, if the Minister can do it in a subtle fashion, he will destroy the building society movement in Australia. People are not aware of this yet, but it is coming. A statement was made today about credit unions. That statement will be debated later. I would like to say something about credit unions later. The Minister is already cutting down to 20 per cent the 30 per cent for home ownership that has come from government funds. His idea is to cut it down progressively further. He is creating a panic situation. He says there is a crisis in housing. 1 do not know whether he believes that or not. Apparently he does because he has said it a dozen times. His idea of a crisis in housing is based on the fact that there are about 93,000 applicants for homes from housing commissions. That is a complete and absolute fallacy, but the Minister does not seem to be aware of it. As 1 have said here before, there is no physical shortage of housing in Australia today to accommodate the population. As a matter of fact, statistically there is one house for every 3.3 people in Australia. It is interesting to note that in the last one year and 9 months - 1 took these figures out only the other day - one house was built for every 1.4 increase in population. This is not a housing crisis at all. I agree with the Minister that there is a social problem; there is not a housing problem. The social problem is that the lower income earners and the indigent people of Australia cannot pay the economic rent, and this creates a problem. It is a self-inflicted wound. I do not have time to deal with this in detail tonight, but this problem has been caused by government controls and interference in the past.

Let us look at this question of applicants for housing commission homes. Most of these people are already living in a home somewhere but they can make out quite a good case of need, on various grounds. Some are perhaps unable to meet the economic rent and others are occupying places where owners want to come into their own homes and the tenants cannot find a comparable place to rent at a rent they can afford. Families grow up and cannot be accommodated. Then there are homes that are unsuitable because of physical features and disabilities and the situation in relation to the place of work. There are quite a lot of these things that create a need so that the person in such a home wants to make an application to the housing commission for a home. These constitute the 93,000 applicants. It is very difficult to prove these things but if honourable members go into the details of them they will find that what I am saying is perfectly true.

No doubt everyone who can make out a case wants a subsidised rent from the housing commission. Once a person moves into a housing commission home, no matter how his financial position may improve, neither the Federal government nor any State government would put him out of that home to make room for somebody who could not afford to pay rent elsewhere. This is quite wrong according to the principle of subsidised rent. It is no exaggeration to say that there are tens of thousands of people in homes owned by the State housing commissions who could afford to pay an economic rent. This is a maladjustment of the occupation of homes.

Let us have a look at these housing commissions. I believe that their functions should be limited. This is not only a criticism of the present Commonwealth Labor Government because it has a different idea altogether about government ownership, but it is also a criticism of some State Liberal governments because, in my opinion, they have the wrong idea. I believe that the functions of housing commissions should be limited to building homes for low income earners in the first place because private enterprise cannot compete on that basis, and to act for governments in the slum clearance of the various cities which is necessary. They should encourage tenants to become owners of their properties. When the governments sell housing commission homes they should sell on a value basis and not on a subsidised cost basis which, in my opinion, is utterly wrong. In other words, they should not be set up in competition with enterprise builders because this creates huge areas of housing with a sameness of construction. That is not a good thing. In such cases the individuality of a home is lost. After all is said and done, a home is perhaps a once in a lifetime thing and all a person’s love and affection is in that home. A person should be able to express his individuality in his home. I say that the States are to blame very largely for the way this situation has developed. They have a vested interest in building big apartments. This is now aided and abetted with government control centralised in Canberra. That is something that I do not like. There is a grave danger, as I see it, with all this enthusiasm of the Minister, of the Government over-stimulating the building industry. Already there is available to the industry, because of the action of the previous Government, a great amount of money that was poured in last year. Apart from the normal operations of Government spending, last year State works and housing programs received $9 82m. I presume that the provision of this amount is continuing under the new Government. Of that sum $24.5m was in the form of non-repayable grants to the States. In addition, a special cumulative grant of $2.75m was made. This amount is to be made available each year for 30 years and is to be used for interest and rental subsidies.

Over a period of 34 years these cumulative grants will amount to $412.5m. In addition $ 1.25m per annum has been provided to enable needy families to enjoy reduced rentals. These grants are now in operation. Over and above the amount provided by the previous Government there are special grants which are for age pensioners’ homes and which are being spent all over Australia. There is also provision for other schemes for homes for the aged which are subsidised by the Federal Gov ernment. In addition, of course, provision ‘g made for homes for servicemen. However, I shall not deal with that subject tonight because it is the subject of a special Bill. The building industry is fully extended at present. Anybody who knows anything about the building industry knows that. If one wants a bricklayer today, one has to beg him and pay an enormous amount. The result is that housing prices are going up and up. Inflation in this area is very difficult to control.

It is interesting to note that a Treasury paper published recently stated that private building approvals in January 1973 were 46 per cent higher than in January 1972. This indicates quite clearly what is happening in the building trade. Whilst we do not want to stand in the way of the States being given this little extra money for the good purpose of providing rental homes, if this amount is linked with the provision made for other housing schemes, including the war service homes scheme that we have yet to discuss, and the scheme about which the Minister for Housing has been having troubles with the States because he does not support home ownership, it will be found that far too much money is being pumped into the building industry with the result that the Government is creating an inflationary trend which it will not be able to control. This is not good for the price structure, the stability of our economy or for anything else. I would like to say much more on this subject, but because of the special circumstances tonight I shall leave it at that. But I warn the Minister for Housing, who is at the table, to be careful of letting his enthusiasm run away with him to a point where he does more injury than good to the people of Australia in the housing field.


– The honourable member for Bennelong (Sir John Cramer) has just presented an interesting philosophy. But, of course, it holds no truth in fact. Today, according to housing commission applications alone, more than 93,000 families in Australia are waiting for a home. Almost half of these families are in my own state of New South Wales. This figure does not represent all people who are waiting for homes. Many people are deterred from applying to the State housing commissions because of the long waiting list for homes. The real number of families waiting for homes must be almost half a million. Most of these people are in the low income group. Possibly the greatest single problem that faces any Australian family is the attainment of a home.

In the area where I reside and which the Minister for Housing (Mr Les Johnson) represents in Sydney, over the last few months a charitable organisation has constructed an experimental home of a certain type. When it did this I asked the people concerned with that organisation whether they would mind keeping a record of the people who came to view that home. They obtained statistical details from the visitors. In Sydney on Monday I was approached by a deputation from the people involved with the construction of the home and since then, by priority mail, I have received details of the people who had visited the home. Over 800 young couples have viewed this home because, supposedly, it is a cheap home. It is a small home at a cheap price. But it is a daily occurrence for the visitors to be in tears as they explain to the people involved in this project that it is impossible for them, paying $35 a week for a rental home, possibly with a bring home pay of $65 a week and with one or two children, ever to look forward to the possibility of owing their own home.

What the honourable member for Bennelong said in some respects was right. But I do not believe that the Minister for Housing or any other honourable member on this side of the House does not want to see everybody owing his own home, if possible. But we have to face facts. One reason why the price of Australian homes has risen out of all proportion is that land costs are so high. In addition there are the actions of agents and developers. The price of land in the Sydney region has risen to such an extent that nobody can reasonably expect to be able to afford a home. This is something that we must look at more seriously. In all other industries we have endeavoured to raise productivity so that people who work in the industry might enjoy the benefits of a productive industry, including higher salary and reasonable working conditions. Higher productivity also means that the employers in industry receive a reasonable return on their investment. In the housing industry for about the last half century no real progress has been made towards better methods of building homes and providing shelter for people. The old bricks and mortal concept is still with us.

Honourable members will be aware that some cities in Australia are importing trades men from the other side of Australia in order to meet the great need for bricklayers and other building workers. Yet in other parts of the world, notably in the United States of America, efforts have been made to mass produce homes in factories and to bring the price down so that everybody might enjoy the benefit of living in reasonable accommodation. The purpose of this Bill is to provide for an urgent need. I suggest that any honourable member who is not inundated with people in his electorate making requests for assistance with housing does not make himself available to the members of his constituency. The constituency which I represent is, by one measure or another, a middle class to higher income area. Yet, daily in my office people ask me to make representations to the New South Wales Housing Commission and other organisations.

Just prior to the recent election, while I was President of a local council in my electorate, I was asked to make representation on behalf of a young couple who were in dire circumstances. They had 3 children, one of whom was very ill and required expensive medical treatment. Some years before the family had applied for consideration from the New South Wales Housing Commission. I used my personal friendship with the Director of the Housing Commission on their behalf. I wrote to him and asked whether these people could be given some priority. After 6 months, the other day they received a reply. Unfortunately the reply was: ‘No, no further priority can be given’. The position in New South Wales is that about 12 months ago there were 36,000 applicants for houses. There are now about 47,000 families waiting for homes in New South Wales. It is absolute rot to say that there is no housing shortage in New South Wales. Of course there is a shortage of the type of housing that people can afford. If people are able to pay $50, $60 and $70 a week in rent, there is no shortage of houses, but the average person can in no way afford to pay that sort of money.

I want to draw the attention of the House to another matter which has concerned me greatly over a long period. I refer to false advertising and the high cost of money for people who want to avail themselves of a house. I cannot see why money, which is a non-productive sort of commodity, should be as expensive as it is to people today. People are having to pay an enormous. price. for money.

I draw the attention of honourable members to an advertisement which appeared in the Sydney ‘Sun’ of Friday, 30th March, which slates:

Starr-Bowkett Interest Free Home Loans.

Nothing could be further from the truth. This is the type of false advertising that has been inflicted on a great number of people, especially in New South Wales, in recent years. Let me read to the House the report of the Registrar of Co-operative Societies for the year ended 30th June 1963 - a long way back. The Registrar stated:

Several years ago 1 reported misgivings entertained by the Government Actuary and by me regarding accelerated activity in what we felt was the artificial promotion of Star-Bowkett societies.

To people who are their natural followers the gamble for the elusive ‘interest-free’ loan by ballot (which, however, may not become available for 15 or 20 years) is no doubt some attraction. Such societies also lend on types of securities that are not always acceptable to other institutions. It is even acknowledged that there are people who would never have saved at all but for membership in a Starr-Bowkett. Against this there are people who have lost on the deal and who have withdrawn in disillusionment; it is of no avail to say that they should have looked more carefully before entering upon membership.

The advertisement which appeared in the

Sydney ‘Sun’ to which I have already referred is most enticing and any young couple trying to get a house of their own would be attracted to it. I hope the House will bear with me, because 1 believe this is a very important matter. The Registrar continued:

In enlightened times societies of this type, the pattern of which originated early in the last century, quite definitely find no favour officially as a pure medium of housing finance, despite refinements they have been persuaded to adopt.

Regardless of all pros and cons my personal inclination after a life-time study of these societies is to view the system itself as one of the ‘horseandbuggy’ variety in a motor-car age. It is regrettable, in my opinion, that expansion of the system should have been featured in a series of broadcasts by a director as ‘one of the real solutions to the problem’ of housing finance.

The report explained that a member of these societies might, if he is very fortunate, obtain an interest free loan but that over a period of 15 years he may not get an interest free loan until right at the end of the period. But he can avail himself of a loan at 4 per cent interest. Many of these people, disillusioned as they are with the ballot system, not being able to have their names drawn and wishing, of course, to get a home while they are still able to enjoy it, embark on this 4 per cent loan. The Registrar sets out in detail in the report from which I quoted just what happens in the first year if a member of the society holding 2 shares takes a loan. The position gets worse as time goes by and it is interesting to note that, in the eleventh year, the interest rate is 56 per cent. A person is being forced to pay 56 per cent, in my opinion, as a result of false advertising. I think it is a matter that the Minister for Housing should examine because surely housing finance is an integral part of the owning of homes.

The matter before the House is an important one. It is a matter of great urgency. I said a few weeks ago that the Government possibly should look at starter homes, homes for young people in their first few years of marriage. I notice that the Minister for Housing has made a number of statements already on this matter. It is possible that the Government may introduce legislation to make available to young couples a cheaper type of housing in the first few years of their marriage in order that they might be able to get on their feet and not be forced to pay exorbitant rents, never getting out of the woods, being forced to live in rented accommodation for life, and in most cases paying a higher rent than they can afford. This Bill will provide for my State alone $3. 5m to be spent in a very short period on the building of houses that otherwise would not be started in that period and I am convinced that this will go some of the way to relieve the great problem that exists.

The honourable member for Bennelong (Sir John Cramer) said that this Government can. not accept the whole blame. He is very charitable indeed, considering that the Government has been in office for only about 120 days. But certainly some governments must accept responsibility for the housing crisis that exists in Australia today. These include State governments of various political persuasions. Surely one of the things we should have learned over this period is that selling off all of our cheap rentable houses is not the solution to the problem. We must keep reserves of cheap rentable housing for people to move into. It is fair enough to assume that a person who, through the natural accretion of his income is able to accrue more morey than he would have had if he had not moved into the rented accommodation will, if he buys a block of land, elect to go ahead and build a home so that he can build up some equity. There will always be those people who, unfortunately, are never able to earn sufficient money to acquire a home of their own. These people are in another category. Possibly, these are the people who the honourable member for Bennelong thought should have homes made available at a reasonable rate.

But there are other people involved and it is important that the housing authorities in the States consider this. Unfortunately, the State Liberal Government in New South Wales has done away with all emergency housing. This is a matter that I have taken up in deputations on a number of occasions and through many social welfare organisations. If a person in Sydney loses his house by fire or some other misadventure, there is nothing that the Housing Commissioner can do to accommodate him and his family. I am pleased to say that under a State Labor government, this was not the case; there was available some emergency housing for people. I have had such people approach me for accommodation. The Minister for Housing who is sitting at the table telephoned me on Boxing Day last year, to have a family whose house had been de-roofed in a violent gale accommodated in a council house which, fortunately, we were able to provide. The State authorities could do nothing on that day to accommodate them. It is a pretty pitiful situation when one finds that on an occasion such as that the St Vincent de Paul Society is the only organisation able to assist these people. The local council fortunately happened to have a vacant home at that time. We were the only people who could provide that family with some accommodation.

So there is a great need for the sort of measure that the Minister for Housing has brought before this House tonight. I compliment the Minister on his swift action and the way that the Cabinet has assisted him and the Treasury in making money available, because I believe that in Australia today there could be no greater crisis than the crisis of providing people with proper homes and accommodation. I certainly hope that this measure will be carried unanimously and we can get on with the job of giving the Australian people what they are justly entitled to - homes of their own to live in.

Debate (on motion by Mr Bury) adjourned.

House adjourned at 9.41 p.m. until Tuesday, 1st May at 2 p.m. unless Mr Speaker shall, by telegram addressed to each member of the House, fix an earlier date of meeting.

page 1460



The following answers to questions upon notice were circulated:

Gross Domestic Product (Question No. 45)

  1. What was the percentage change for the total economy in (a) implicit price deflator, (b) unit labour costs, (c) unit profits, (d) unit indirect tax less subsidies and (e) other unit costs during each calendar year from and including 1966.
  2. What was the average percentage change in these categories in each year.
  1. The Australian national accounts show gross domestic product divided into 3 cost components (i) wages, salaries and supplements, (ii) gross operating surplus and (iii) indirect taxes less subsidies. Wages, salaries and supplements represents recorded labour costs and does not cover the labour of the proprietors of unincorporated enterprises. Gross operating surplus is the operating surplus before deduction of depreciation provisions, interest, royalties, agricultural rent and income tax payable, but after deducting stock valuation adjustment, ft includes the reward for the labour of the proprietors of unincorporated enterprises. It also includes the operating surplus from all dwellings whether these are let or occupied by the owner. The following table has been calculated by firstly dividing the major cost components and gross domestic product by gross domestic product at constant (average 1966-67) prices and then calculating the year to year percentage increases in the resulting ratios. The total column shows the percentage change in what is sometimes called the implicit price deflator of GDP. Annual national accounts estimates for Australia are published for financial years ending June, and the table has been prepared accordingly. The figures shown in the table for each financial year are the increases from the preceding financial year.
  1. The ‘implicit price deflator’ is a currently weighted average of the Implicit unit costs of the cost components. See part (1). 35-Hour Week: Increased Costs (Question No. 119)
  1. What increase in (a) the national wages bill and (b) unit labour costs will be caused by the introduction of a 35-hour week for all wage and salary earners.
  2. What increase in (a) the national wages bill and (b) unit labour costs will be caused by the introduction of a 33-hour week on the basis publicly outlined by the Government.
  3. What increase in (a) the national wages bill and (b) unit labour costs will be caused by the introduction of a 33-hour week for all wage and salary earners in the (i) Commonwealth Public Service, (ii) motor vehicle industry, (iii) fuel and power industries, (iv) iron and steel industries, (v) stevedoring industry, (vi) building and construction industry and (.vii) retailing industry.
  4. Can he say what the inflationary effects will be in respect of parts (1), (2) and (3).
  1. and (3) As the honourable member will be aware, an Interdepartmental Committee appointed by the previous Government to assess the cost of a 35-hour week was not able to produce definitive estimates because of the great diversity of possible assumptions that could be made. On the assumption that a reduction in working hours would not be accompanied by any increase in productivity the Committee estimated ultimate increases in unit labour costs ranging between 8 per cent and 18 per cent, depending on further assumptions regarding the effective reduction in ordinary hours of work, the way in which production would be made up (if at all), etc. Estimated increases in unit labour costs of the order indicated would add between $1 ,800m and $4,000m to the current national wages bill.

In view of the tenuous nature of the assumptions made, and in particular the assumption of unchanged productivity, I do not believe the estimates represent a useful indicator of the effective cost of introducing a 35-hour week.

The Committee also estimated that a levelling of working hours to 35 a week in the Commonwealth Public Service would add approximately $100m or of the order of 8 per cent to the total Commonwealth Public Service salaries and wages bill. An increase of the order of $100m to the national wages bill would raise unit labour costs by approximately 5 per cent assuming no increase in productivity. The Committee did not estimate costs in respect of industries referred to in parts (it*) to (vii) of section (3) of the honourable member’s question. Estimates that might be made on available data would be no less tenuous than those already given ‘ in this answer to the honourable member’s question.

  1. and (4) The policy of the Government is to support a 35-bour week only in those industries which have sufficient capacity to absorb it. Introduced on this basis a 35-hour week should not have any significant inflationary effect.

Law Relating to Cheques (Question No. 163)

  1. Has the Attorney-General carried out any examination of the recommendations of the Manning Report into the operation of the Bills of Exchange Act and, in particular, the recommendation that the law relating to cheques be covered in a separate Cheques Act.
  2. ff so, what was the outcome of the examination.
  1. and (2) I have given some consideration to the recommendations contained in the report of the Manning Committee. The report is of a technical nature and will require further consideration before any conclusions can be reached. I have instructed that the consideration be expedited.

Telephone Tapping (Question No. 241)

  1. What is the mechanism by which phone tapping may be authorised by (a) the Commonwealth and (b) the States.
  2. How many such authorisations were obtained in each of the last 10 years.
  3. How many (a) Commonwealth and (b) State parliamentarians were amongst those whose phones were tapped during each of those years.
  4. How many phone tappings are authorised at present.
  1. (a) The interception of telephone communications is forbidden by the Telephonic Communications (Interception) Act 1960 unless the interception is one which is specifically authorised under the Act. The relevant sections of the Act are sections 5 and 6. Section 5 (2.) of the Act authorises certain interceptions by an officer of the Postmaster-General’s Department in the course of his duties. Section 6 of the Act authorises the issue of a warrant to intercept a telephone conversation by the Attorney-General or, in an emergency, by the Director-General of Security. Where the Director-General of Security issues a warrant, he is required forthwith to furnish a copy of the warrant to the Attorney-General and a statement of the circumstances that lead ‘ to the issue of the warrant.

    1. The interception of a telephone conversation may not lawfully be authorised by a State or an authority of a State.

In each case, the number of authorisations includes renewals of warrants previously authorised.

  1. None.
  2. The number of warrants authorised at 7th March 1973 was 19.

Over-Award Payments (Question No. 269)

  1. Will he provide statistics to show the increase in the wages drift since 1964-65.
  2. What action is proposed to arrest or slow down the wages drift.
  1. There are no official published statistics on the incidence of over-award payments over this period, and no precise estimate can be made of the increase (if any) in wages drift. Nevertheless the available information enables an approximate assessment of the trend to be made, and this information is set out in the paragraphs which follow:

Table A below sets out the percentage changes in the Commonwealth Statistician’s series on average minimum wage rates for adult males and on average weekly earnings per employed male unit.

Because of significant differences in coverage the two series are not strictly comparable. For ‘ instance the wage rate series covers only adult males whereas the earnings series relates to- all males. Further, the wage rate series relates mainly to ‘wages’ as distinct’ from salaries’, while the average earnings series includes both. This means that differences in rates of growth of the two series may reflect differences in the rates of growth of earnings of adults relative to juniors or of white collar workers relative to blue collar workers. In addition, the average earnings series is affected by overtime as well as by over-award payments and also reflects changes in the importance of different industries and occupations.

My Department has made some rough estimates on a calendar year basis, from 1966 onwards, of minimum award wages and average weekly earnings (net of overtime), both on a per employee basis. The annual percentage changes in these two series in the period 1967 to 1972 are shown below in Table B.

  1. The figures above, although approximate, suggest that wages drift, which was most pronounced in 1969 and 1970, has not been a serious problem in the past two years. In any case, the recommendations made by the Government in the recent National Wage Case and its policies in regard to prices, competition, manpower and decentralisation, are designed generally to reduce the incidence of wage drift.

Bland Report on Administrative Discretions (Question No. 309)

  1. In view of its assertions regarding open government, why has the Government not released the Bland Report on Administrative Discretions.
  2. Having regard to the ordinances passed by the Legislative Council for the Northern Territory concerning an ombudsman for that Territory, what are the Bland Committee’s recommendations in relation to the ombudsman for the Territory and its Legislative Council.

The Interim Report of the Bland Committee is at present being printed. Printing is expected to be completed very soon. The Report will then be tabled.

Urban Public Transport: Improvement of Services (Question No. 353)

  1. Does the Government propose to improve public transport in both Melbourne and Sydney at a cost of hundreds of millions of dollars.
  2. If so, will the Government give an undertaking to provide pro rata assistance in respect of public transport to larger provincial cities as a means of assisting decentralisation.
  1. The Government has approved in principle a scheme to provide two thirds of the cost of improving urban public transport in the State capital cities.
  2. The Government has also undertaken to examine the needs of main provincial centres where populations exceed 100,000. Furthermore, the Government will consider supporting the improvement of public transport services in the corridors linking these provincial centres with major cities.

Urban Public Transport: Free Off-Peak Services (Question No. 354)

  1. Does the Government propose to provide grants to urban public transport to provide free off-peak transport to State capitals and provincial cities.
  2. If so, will the Government give an undertaking to provide similar grants to private transport operators in provincial cities where there is no public transport system.
  1. and (2) On 16th February I announced that the Australian Government had approved in principle a scheme to provide two-thirds of the cost of improving the urban public transport services. At the same time I announced that the Government was also prepared to examine the needs of the major provincial centres with a population of 100,000 or more and to consider improvements in the corridors linking these centres with capital cities.

The implementation of this assistance scheme is regarded by the Government as a matter of top priority and we are currently examining with State Governments possible proposals for inclusion.

The question of providing grants for free off-peak travel will be examined in more detail at a later stage in conjunction with State transport authorities. The Government is fully aware of the role and importance of private bus operations in both outer areas of large cities and in provincial centres.

Commonwealth Railways: Concrete Sleepers (Question No. 365)

  1. Has he received protests from all political parties in Western Australia, local government authorities and many others, including myself, on behalf of the electors of the Electoral Division of Forrest as a result of his decision to consider using concrete instead of timber sleepers for the Commonwealth Railways.
  2. Have senior officials of the Commonwealth Railways already made up their minds in favour of concrete sleepers.
  3. If so, is it a fact that such a decision will put in jeopardy 30 small mills engaged in sleeper produc- tion in the south-west of Western Australia, a long established decentralised industry, and that the jobs involved will affect well over 1,000 people who will be unable to find alternative employment and will be forced to drift to the city.
  1. I have received representations from both timber and concrete producers, and from authorities and organisations associated with the sleeper industry. I also had discussions with the Western Australian Minister for Forests, the Honourable H. D. Evans.
  2. The Commissioner, Commonwealth Railways has been instructed to call tenders for both concrete and timber sleepers for the maintenance program on the Trans-Australian and also for new line construction such as the proposed Tarcoola to Alice Springs Railway. Before calling tenders, the Commissioner will consult with me on the most appropriate size for timber sleepers as well as the most appropriate delivery points for the supply of such sleepers.
  3. I am very conscious of the possible importance for employment of any decision onthis matter. I should also add that, regardless of the final decision on which sleepers are used for new line construction, Commonwealth Railways will continue to use timber sleepers for spot replacement work on its existing lines.

Civilian Labour Force (Question No. 22)

What (a) increase in number and (b) percentage increase in the labour market was due to (i) migrants and non-migrants (ii) males (iii) females (iv) juniors and (v) adults in each of the last 10 calendar years.

Estimates of the average numbers of persons in the civilian labour force in each year from 1964to 1972, derived from the quarterly population survey, were used to calculate the increases in number and percentage increases shown below.

  1. Estimates tor migrants and non-migrants became available only in early 1972: no estimates of annual change are available.

    1. Males in the Civilian Labour Force

The quarterly population survey was instituted on an Australia-wide basis in February 1964: information is therefore not available for the years 1962 and 1963. Information is not available for the age groups 15-20 years and 21 years and over (i.e. juniors/adults); information has been supplied for the closest possible age groupings.

Final estimates for movement in 1971-72 in the areas covered above are not yet available and I shall provide the information by, way of a supplementary answer as soon as it does become available.

First Whitlam Ministry: Salaries (Question No. 127)

  1. During the period of (he First Whitlarn Ministry, Australia’s first 2-man government, were he and tha Deputy Prime Minister entitled to the full salaries of all the ministerial positions held by each of them. ‘
  2. If so, to what sum was each of them entitled.
  3. ls it a fact that both he and the Deputy Prime Minister drew only the same salary and allowances as those drawn by their predecessors.
  4. If not, what additional salary and/or allowance or remuneration, payable by virtue of their offices, was received.
  5. What was the total sum actually received.
  6. What legal authority or device was used to waive or remit such salary and allowances to which they were entitled in excess of those received.
  7. On what date was that authority or device invoiced, and by what method was the waiver or omission effected.
  8. If no such act was done, is it a fact that the excess of entitlement over the amounts received is a debt due and payable on demand to him and the Deputy Prime Minister personally.
  1. No. The Ministers of State Act 1952-1971 sets out the annual sum payable for the salaries of Ministers of State within which the Government determines the actual salaries paid to the Prime Minister and Ministers. We determined that during this period we should receive only such salary as we received as Leader and Deputy Leader of the Opposition respectively.
  2. See answer to (1).
  3. , (4) and (5) No. We drew the same allowances as our predecessors ($10,300 p.a. and $4,600 p.a. respectively) but as stated in answer to (1) we determined we should receive only such salary as we received as Leader and Deputy Leader of the Opposition, i.e., $10,500 p.a. and $5,000 p.a. respectively.
  4. There was no entitlement to ministerial salary and allowances in excess of those received.
  5. and (8) See answer to (6).

Prime Ministers’ Staffs (Question No. 138)

  1. Will he provide a comparison of (a) the number of categories, (b) qualifications and (c) cost of salaries and allowances of his personal staff with that of his predecessor, Mr McMahon.
  2. By how many, in what categories, and at what cost have additional positions been created in his Department since 5th December 1972.
  1. Unlike Mr McMahon, I hold the portfolio of Foreign Affairs as well as Prime Minister. As there is no clear division of my own staff between the 2 portfolios, the table below includes, for comparative purposes, the staff appointed by Mr Bowen as Minister for Foreign Affairs.

The compilation of a full list of all qualifications of all members of staff would take much time. I could readily provide the honourable member with any relevant specific details in regard to members of my own staff. I would prefer that he himself approach my predecessor in relation to his staff.

  1. Apart from positions transferred from the Department of the Environment, Aborigines and the Arts, 23 positions have been created in the Department of the Prime Minister and Cabinet since Sth December 1972. Of this total, 12 are in the Third Division and represent an annual estimated salary cost of $97,000 and 11 are in the Fourth Division, representing $39,000. Action to create 6 of these positions (4 Third Division, 2 Fourth Division at an estimated annual salary cost of $45,000) was initiated in the time of the previous Government.

Whitlam Ministry: Foreign Policy (Question No. 373)

  1. Has he announced that his Government’s foreign policy is to achieve an independent stance; if so, does this mean that the policy towards the United States of America is to be different.
  2. Did be write a personal letter to the President of the United States in December criticising the Government of the United States’ policy in respect of North and South Vietnam and/or other matters.
  3. If so, would it be most appropriate to describe this communication (a) as a personal letter to the President of the United States, (b) as a diplomatic note or (c) by another description.
  4. If he did communicate with the President (a) what was the . date the communication was despatched, (b) on what date did he first publicly disclose it had been sent, (c) what was the method of its delivery to the United States and (d) was the Australian . Ambassador to the United States consulted before the letter was signed.
  5. In view of the great interest by Australians in the relationship between Australia and the United States, will he ask for the agreement of the President of the United States for that letter to be published.
  6. Has he received any substantive reply.
  7. Has the Australian Embassy in Washington been given any indication of how the President reacted when he received the communication.
  1. It remains a basic objective of the Government to foster close and continuing co-operation with the United States on a basis of equality and maturity.
  2. , (3), (4), (6) and. (7) I sent a personal message to President Nixon through the Australian Embassy, Washington, on 20th December 1972, expressing concern at the course of events in Vietnam. It was delivered to the White House on 21st December. The existence of the message became known soon afterwards and was referred to at my Press conference of 9th January. The matters raised in the message were discussed in Washington with the Secretary of State and with senior United States officials. The United States Ambassador in Canberra also discussed them with me.
  3. No.

Cite as: Australia, House of Representatives, Debates, 12 April 1973, viewed 22 October 2017, <>.