House of Representatives
6 May 1976

30th Parliament · 1st Session

  1. House of Representatives
  2. 30th Parliament
  3. 1976

Mr SPEAKER (Rt. Hon. B. M. Snedden, Q.C.) took the chair at 10.30 a.m., and read prayers.

page 1989

PETITIONS

The Clerk:

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

Aurukun Community: Mining

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth

Whereas the Aurukun Associates Agreement Act was passed in contravention of a 1 968 agreement;

Whereas this Act conflicts seriously with Commonwealth Government Policy on Aboriginal Affairs and on Australian equity in multinational corporations working in Australia;

Your petitioners therefore note with appreciation the statements already made on the matter by Government members but humbly pray that the Commonwealth Government will also

  1. initiate a Commission of Enquiry into the whole matter
  2. insist that no mining take place on the Aurukun Aboriginal Reserve until a full environmental impact study has been made by the Commonwealth Department of the Environment, Housing and Community Development
  3. refuse to grant an export licence to the Consortium until detailed negotiations are held at Aurukun by Consortium representatives with the Aurukun people, the traditional owners of the land, and advisers of their choice, and an agreement satisfactory to all has been reached.

And your petitioners as in duty bound will ever pray. by Mr Adermann, Mr Connolly, Mr Fisher, Mr Fry and Mr Willis.

Petitions received.

United Nations Conference on Trade and Development

To the Speaker and the House of Representatives in Parliament assembled. The petition of the undersigned citizens of Australia respectfully showeth that many Australians are concerned that Australia take a strong role of leadership at the forthcoming United Nations Conference on Trade and Development.

We your petitioners do therefore humbly pray that the Australian Government instruct its delegation to the fourth session of UNCTAD

  1. to speak in support of the principle of an integrated program of commodities
  2. to take pan in follow up activities after the fourth session to help bring about the integrated program
  3. to offer financial assistance for these activities
  4. to give special consideration and attention to tea, bauxite, copra ana other commodities of particular importance in our trade with the third world and the Pacific Islands in particular, and to work for the inclusion of these commodities in the program.

And your petitioners as in duty bound will ever pray, by Mr Bradfield and Mr Hurford. Petitions received.

Trade Union Ballots

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth:

That whereas the Democratic control of organisations registered under the Conciliation and Arbitration Act is essential to a sound system of industrial relations;

And whereas Democratic control can only be guaranteed by the opportunity for all rank and file members of organisations to vote in elections for all officials and all Committees of Management and whereas some forces within the Trade Union Movement are attempting to deny rank and file members the right to vote in all Union elections;

Your petitioners humbly pray, that the members in Parliament assembled will take steps to:

  1. Preserve Democracy in Trade Unions by guaranteeing the right of all members to participate in rank and file ballots for officials and Committees of Management.
  2. Resist the pressures from those elements in the Trade Union Movement seeking to deny members the right to vote.
  3. Ensure the widest participation in Union ballots by making voting compulsory in union elections.
  4. Resist the re-introduction of the undemocratic collegiate system of union elections, which enables control and manipulation by minority and extremist elements.

And your petitioners as in duty bound will ever pray, by Mr Bradfield and Dr Klugman. Petitions received.

Australian Assistance Plan

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth that since the Australian Assistance Plan is providing the opportunity for citizens of Australia to participate in an integrated planning process with all levels of Government and since Regional Councils for Social Development foster self-help and extensive volunteer activity in (oca! committees.

We your petitioners do most humbly pray that the House of Representatives in Parliament will take immediate steps to continue the Australian Assistance Plan as recommended in the Report tabled by the Honourable the Minister for Social Security, Senator Margaret Guilfoyle in Parliament on the 4th of March 1976.

And your petitioners as in duty bound will ever pray, by Dr J. F. Cairns and Mr Falconer. Petitions received.

Overseas Development Assistance

To the Speaker and the House of Representatives in Parliament assembled. The petition of the undersigned citizens of Australia respectfully showeth that many Australians are concerned at the announced decision by the Commonwealth Government to reduce the 1975/76 Overseas Development Assistance vote by $21 million and by the abolition of the Australian Development Assistance Agency.

We your petitioners do therefore humbly pray that the Commonwealth Government:

  1. as a matter of urgency, reverse the decision to cut the 1975/76 Overseas Development Assistance vote so as to ensure that the full amount appropriated by Parliament for Overseas Development Assistance is spent this financial year to meet the pressing needs of those in the developing countries.

    1. reaffirm Australia’s commitment of Overseas Development Assistance being a minimum of 0.7 per cent of GNP, and
    2. establish a fully independent statutory authority to administer Australia’s official Overseas Development Assistance.

And your petitioners as in duty bound will ever pray by Mr Chapman and Mr Fry.

Petitions received.

Pharmaceutical Benefits: Milk Substitutes

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. We, the under signed citizens of the Commonwealth of Australia by this our humble petition respectfully showeth:

  1. That reduction of the age limit from six years to eighteen months for patients to receive cows’ milk substitutes as a pharmaceutical benefit under the schedules of the National Health Act will cause serious financial hardship to many families;
  2. That children allergic to cows’ milk and other dairy products who often include asthmatics and sufferers of respiratory complaints depend on Soya Bean milk such as Isomil or Prosobee as a main source of protein;
  3. That the Government’s action is responsible for a 100 per cent increase in the cost of milk substitutes frequently involving parents in expenditure of $10 per week to sustain desirable protein intake for an affected child;
  4. That there is an urgent, humane need to restore milk substitutes to children up to six years of age to the schedule of Pharmaceutical Benefits.

Your petitioners therefore humbly pray that milk substitutes be restored to the schedule of Pharmaceutical Benefits for children up to the age of six years as soon as possible.

And your petitioners as in duty bound will ever pray by Mr Les McMahon and Mr Morris.

Petitions received.

Pimlico High School

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. We, the under signed staff of Pimlico State High School by this our humble petition respectfully showeth:

  1. That continuing financial support for Education from the Commonwealth Government is essential so that the following immediate needs of the above school in particular may be met:

    1. reduction of the overall size of the school by the construction of a fourth high school in Townsville, strategically located;
    2. reduction of some large class sizes;
    3. replacement or updating of 13 temporary class rooms;
    4. the provision of adequate facilities in terms of science laboratories, a drama area, a less crowded administration block and an extension of library facilities;
    5. the reduction of crowding and updating of facilities in many of our staffrooms.
  2. That continuing financial support for Education from the Commonwealth Government will allow State Education Departments to forward plan for sufficient specialist teachers and teachers aids so that larger schools are not disadvantaged.
  3. That continuing financial support for Education from the Commonwealth Government could encourage State Governments to investigate and predict future needs of schools in terms of the provision of sufficient full time guidance officers and social workers.

And your petitioners as in duty bound will ever pray by Mr Bonnett.

Petition received.

Cadet Corps

To the Honourable the Speaker, and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth-

That the three service cadet forces have great value in the development of the youth of Australia.

That the disbanding of the cadet forces will disperse accumulated expertise and interest of those involved, and in some cases negate the efforts of many people over many years.

Your petitioners therefore humbly pray that the Government will reconsider its decision and that the Government will reinstate the cadet forces.

And your petitioners as in duty bound will ever pray by Mr Carige.

Petition received.

Australian Assistance Plan

To the Speaker and the House of Representatives in Parliament assembled. The petition of the undersigned citizens of Australia respectfully showeth that many Australians are concerned at the possibility that cuts in Government expenditure will adversely affect the operations of the Australian Assistance Plan.

We your petitioners do therefore humbly pray that the Commonwealth Government endorse the continuation of the Australian Assistance Plan as a long-term program to be implemented on a regional basis throughout the nation.

And your petitioners as in duty bound will ever pray by Mr Carige.

Petition received.

Income Tax: Land and Water Rates

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth: That the undersigned persons believe that-

The $300 limit on income tax deductibility in respect of personal residential land and water rates is unrealistic and is a discriminatory income tax penalty.

Your petitioners therefore humbly pray that the Government will take steps to see that the aforesaid limitation is removed entirely or substantially increased.

And your petitioners as in duty bound will ever pray by Mr Connolly.

Petition received.

Fraser Island

To the Honourable the Speaker and Members of the House of Representatives assembled. The humble petition of the undersigned citizens of Australia respectfully showeth: That whereas the natural environment of Fraser Island is so outstanding that it should be identified as part of the World Natural Heritage, and whereas the Island should be conserved for the enjoyment of this and future generations,

Your petitioners humbly pray that the members, in the House assembled, will take the most urgent steps to ensure:

  1. that the Australian Government uses its constitutional powers to prohibit the export of any mineral sands from Fraser Island, and
  2. that the Australian Government uses its constitutional authority to assist the Queensland Government and any other properly constituted body to develop and conserve the recreational, educational and scientific potentials of the natural environment of Fraser Island for the long term benefit of the people of Australia.

And your petitioners as in duty bound will ever pray by Mr Connolly.

Petition received.

Australian Heritage Commission

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

There is a growing interest and concern in all sections of Australian society for the conservation of the environment, natural and man-made.

That there are also rapidly growing pressures by powerful forces tending towards the destruction of the Australian heritage.

That it is therefore urgent to appoint the Australian Heritage Commission, which was approved by both sides of this Parliament and to give the Commission sufficient independent staff, resources and funds.

That Technical Assistance Grants and Administrative Support Grants to community organisations are needed to partially redress the gross imbalance in technical expertise and resources suffered by community groups in pressing the community’s case against the exploiter.

That a proper balance between the Governments programme of public austerity and the need for action in conservation would be a modest increase in the budget allocations in these areas over that of 1 975-76.

And your petitioners as in duty bound will ever pray by Mr Fry. (2 petitions).

Petitions received.

Australian Heritage Commission

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned members of the Warringal Conservation Society, Heidelberg, Victoria, respectfully showeth that:

There is a growing interest and concern in all sections of Australian society for the conservation of the environment, natural and man-made.

That there are also rapidly growing pressures by powerful forces tending towards the destruction of the Australian heritage.

That it is therefore urgent to appoint the Australian Heritage Commission, which was approved by both sides of this Parliament and to give the Commission sufficient independent staff, resources and funds.

That Technical Assistance Grants and Administrative Support Grants to community organizations are needed to partially redress the gross imbalance in technical expertise and resources and suffered by community groups in pressing the community’s case against the exploiter.

That a Proper balance between the Governments programme of public austerity and the need for action in conservation would be a modest increase in the budget allocations in these areas over that of 1975/76.

And your petitioners as in duty bound will ever pray by Dr Jenkins.

Petition received.

Australian National Library

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

  1. . That as of the 29 March 1976 opening hours of the Australian National Library have been reduced to the following times: Wednesday and Thursday, 9.30 a.m. to 10.00 p.m.; Monday, Tuesday, Friday, Saturday and Public Holidays, 9.30 a.m. to 4.45 p.m.; Sunday, 1.30 p.m. to 4.45 p.m.
  2. That the expenditure cutbacks and consequent reduction in the hours of opening of the Australian National Library have seriously disadvantaged part-time students who are able to devote only evening hours to study.
  3. That because of the reduced hours of operation, students, particularly those in the Arts Faculties, have a very limited time available in which to consult primary source material held at the Australian National Library.
  4. That the suspension of purchasing of books on an individual basis, and of university theses on microfilm will seriously disadvantage research students.
  5. That the Australian National University Library and the Canberra College of Advanced Education have only limited collections, both requiring to be complemented by the Australian National Library collections.
  6. That the lowering of educational standards as a consequence of the restrictions on educational facilities, would result in immeasurable non-economic cost to the community.

We, your petitioners, therefore humbly pray that the Australian National Library be accessible to readers 9.30 a.m. to 10 p.m. daily. by Mr Fry.

Petition received.

Schools Commission

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth:

  1. The present level of Federal Government Education Expenditure is increased to the level recommended by the Schools Commission.
  2. The role of the Schools Commission as an independent statutory authority free to make its own assessment of the needs of Australian Education is maintained.

Your petitioners therefore humbly pray that the Government will take no measures to interfere with the Schools Commission.

And your petitioners as in duty bound will ever pray by Mr Keith Johnson.

Petition received.

Omega Station in Australia

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

  1. That Omega is the only navigation system, whose signals can be used by submarines to determine their position when submerged.
  2. That in particular the missilesfiring submarines of the USA can improve their destructive potential by using Omega signals.
  3. That therefore an Omega station built in Australia would be listed for nuclear attack by any power, believing itself threatened by the USA.
  4. That such a station would therefore represent a further hindrance to the development of an independent and peaceful foreign policy for Australia and a new contribution to the threat of nuclear annihilation.

Your petitioners most humbly pray that the Australian Government will reject any proposal to build an Omega station on Australian soil.

And your petitioners as in duty bound will ever pray by Mr Keith Johnson.

Petition received.

Radio and Television Licences, Medibank and Pharmaceutical Benefits

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned citizens of Australia respectfully showeth-

That the new Government during the recent election campaign, promised lower taxation and more money in people ‘s pockets.

Your petitioners therefore humbly pray -

That the House of Representatives will take immediate steps to prevent the introduction of Television and Radio licence fees, the imposition of a tax levy for Medibank and the introduction of higher charges for drugs dispensed under the Pharmaceutical Benefits Scheme.

And your petitioners as in duty bound will ever pray by Br Klugman.

Petition received.

Income Tax

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of undersigned citizens of Australia respectfully showeth-

That the existence of a system of double taxation of personal incomes whereby both the Australian Government and State Governments had the power to vary personal income taxes would mean that taxpayers who worked in more than one State in any year would-

  1. be faced with complicated variations in his or her personal income taxes between States; and
  2. find that real aftertax wages for the same job would vary from State to State even when gross wages were advertised as being the same; and
  3. require citizens to maintain records of income earned in each State.

Your petitioners therefore humbly pray that a system of double income tax on personal incomes be not reintroduced.

And your petitioners as in duty bound will ever pray by Mr Morris.

Petition received:

page 1992

QUESTION

QUESTIONS WITHOUT NOTICE

page 1992

QUESTION

CANBERRA HOSPITALS

Dr CASS:
MARIBYRNONG, VICTORIA

– I direct my question to the Minister for Health. He will recall that on 24 March I asked a question concerning the inadequate number of specialist medical staff appointed to the Canberra Hospital and that in his reply he expressed concern at the shortage of medical staff. Has he had the discussions which he foreshadowed at that time with members of the salaried medical staff of the 2 Canberra hospitals? What steps have been taken to overcome the acute staff shortage? Has the Australian Capital Territory Medical Association given any indication of its reaction to further appointments of salaried medical staff, even if only to restore the staffing to previously established levels? Does the staff shortage mean that inadequate medical care is available to patients seeking to exercise their rights as hospital Medibank patients?

Mr HUNT:
Minister for Health · GWYDIR, NEW SOUTH WALES · NCP/NP

– I am very concerned about the situation that exists in the Australian Capital Territory. It is a situation that I have inherited from the former Government in that there has been a very big division between the private practising doctors in Canberra and the salaried doctors. One of the big problems that I have had is to try to persuade both the private doctors and the salaried doctors that they have a place under the sun in Canberra. I am completely satisfied that salaried doctors are here to stay and have a very important role to play, just as I am satisfied that the private specialists and the private doctors also have a very important role to play in Canberra.

There is a shortage of doctors in Canberra. I am not prepared to make any appointments until I have had adequate consultation with the Australian Capital Territory Medical Association and until the Government has taken a decision on what changes it intends to make to Medibank, because I will not take a decision in respect of the Australian Capital Territory that cannot be implemented in any one of the States. I have had a meeting with the Australian Capital Territory Salaried Staff Council and also with the Australian Capital Territory Medical Association, and I have arranged for a joint meeting of both bodies to be held at the earliest opportunity to try to ensure that they will assist in devising rules by which they themselves will work together in the hospitals. We are not prepared to stand by without taking some action to ensure that we close this division between the doctors. We must have the private and salaried doctors working as a team in the general public interest in Canberra.

page 1993

QUESTION

BORDER BETWEEN AUSTRALIA AND PAPUA NEW GUINEA

Mr HYDE:
MOORE, WESTERN AUSTRALIA

– My question is directed to the Prime Minister. Has the Papua New Guinea Government demanded that the border in Torres Strait be moved to within 16 kilometres of Cape York? Did the Deputy Prime Minister, in his talks with the Queensland Premier this week, seek a compromise that would go part of the way towards meeting this demand?

Mr MALCOLM FRASER:
Prime Minister · WANNON, VICTORIA · LP

– There is a report in one newspaper this morning which, according to all the knowledge I have, is completely and utterly false. I do not blame the newspaper for having printed it because I have little doubt that it was given that information. The report is false. No such request has come from Prime Minister Somare of Papua New Guinea. I would add that any person who seeks to suggest that the Commonwealth Government will not protect the rights of all Australians is doing a great disservice to this Government, to this Parliament and to Australia. In any negotiations that we intend to have in relation to these matters the nationality of all Australians will certainly be protected. It is our objective and intention to protect the land, culture, traditions and way of life of all Australians. There is no question about our intention and purpose in relation to these particular matters. Any suggestion from any source that that is not so- obviously my remarks are directed to the Torres Strait Islanders- and that those matters are not the firm goal of the Commonwealth Government, does a great disservice to the Islanders. It will cause them serious concern and not assist in achieving a proper definition of the situation between Papua New Guinea and Australia which will be in the interests of the long term stability of relationships between Papua New Guinea and Australia and which at the same time will do perhaps more than anything else to make sure that the Torres Strait Islanders can live in their traditional way undisturbed for the rest of time.

page 1993

QUESTION

CANBERRA HOSPITALS

Dr JENKINS:
SCULLIN, VICTORIA

-My question, addressed to the Minister for Health, is supplementary to that asked by my colleague the honourable member for Maribyrnong and is relative to the Minister’s answer. Is it a fact that the Australian Capital Territory Medical Association has given notice that its members will not refer patients to nor accept referrals from salaried medical staff employed at the Canberra hospitals? What action does the Government intend to take to ensure that patients are not deprived of their rights in this unilateral fashion by some Canberra medical practitioners? Does this refusal to refer patients to or accept referral of patients from salaried hospital medical staff by private medical practitioners in Canberra constitute a potential or actual threat to the quality of medical care available to Canberra citizens- a threat to their safety and well being?

Mr HUNT:
NCP/NP

– Once again, the honourable member is clearly aware of the divisions that exist between the salaried staff members of the Canberra hospitals and the private practitioners. There is fault on both sides because, as I understand the situation at the present time, some of the salaried specialists are not allowing some private specialists to use equipment in the Canberra hospitals. I am having an investigation made into that practice. I do not approve the bans, as they are called that apparently are imposed in the Australian Capital Territory and I will be having further discussions with the Australian Capital Territory Medical Association on this problem. Unless we get co-operation between the salaried staff members in the hospitals and private practitioners, the public, of course will suffer and I, as the Minister, cannot stand by and see that happen. Unless they can resolve their differences I will be taking actions to ensure that there is a resolution of the problem.

page 1993

QUESTION

EXPORT INDUSTRIES

Mr Ian Robinson:
COWPER, NEW SOUTH WALES · CP; NCP from May 1975

– My question is directed to the Minister for Overseas Trade. I refer to the extreme difficulties facing export industries as a consequence of cost escalations and ask: Is the Government concerned about the ability of our export industries to remain competitive or. world markets if inflation is not brought down to more reasonable levels? What action does the Government propose in its overall economic strategy to assist exporters?

Mr ANTHONY:
Deputy Prime Minister · RICHMOND, NEW SOUTH WALES · NCP/NP

-I think it is to the credit of our export industries that they have been able to keep up such a very high level of performance and keep our foreign exchange position so healthy. This has been largely as a result of the very high degree of efficiency of our own industries, hard work, the use of technology and the use of fortunate circumstances to produce much of our food and fibre. But inflation is having an impact on the living standards of many people in our export industries. The reason for this is that costs are becoming unbearable to many of these people. Whilst they are still able to sell thengoods overseas there is very little margin in it for them to reinvest in order to keep up their capacity to produce or to give them a decent standard of living. So it is very important for the whole welfare of Australia that these industries be kept on a sound basis. That cannot be accomplished, however, if costs and prices continue to rise as they have done in recent years, that is, at a rate which is faster than that experienced by many of the competitors of our export industries throughout the world.

Many people in export industries, particularly in the manufacturing and mining areas, talk a good deal about incentives to help export performance. Certainly incentives do help; they make a contribution; they are a stimulus. But all the export incentives will be cancelled out if inflation continues at the rate we have seen. It must be the objective of the Government to bring costs under control. If we get to the point where the industries can no longer perform the position then hardly bears thinking about, because the lives of probably a million Australians who are directly and indirectly associated with the export industries will be affected. But worse than that, this country cannot maintain its present standards and its progress unless we have a sound export industry. Therefore it behoves any responsible government to give its attention to the cost and price increases that affect industry. This Government has given a pledge to the Australian people that it will do something about it.

page 1994

QUESTION

AUSTRALIAN CAPITAL TERRITORY MEDICAL ASSOCIATION

Mr Antony Whitlam:
GRAYNDLER, NEW SOUTH WALES · ALP

-My question is directed to the Minister for Health. Is it a fact that the Australian Capital Territory Medical Association has given notice that its members will not provide treatment under Medibank in Canberra hospitals to patients who have not passed a means test for free treatment? If that is the case, what action will the Government take to overcome unilateral action by some Canberra doctors to limit the freedom of choice of patients in Canberra and to deprive patients of their rights under Medibank?

Mr HUNT:
NCP/NP

– I have already answered the question that the honourable member asks. But let me repeat that I, as Minister for Health, am concerned about a decision that was reported to me to have been taken by the Australian Capital Territory Medical Association. I have good reason to believe that that decision is being reviewed. In the meantime I shall take no further action whatsoever to divide the doctors in the Australian Capital Territory.

page 1994

QUESTION

EXPENDITURE ESTIMATES

Mr ALDRED:
HENTY, VICTORIA

-I direct my question to the Prime Minister. Has the Government received initial reports from its officials concerning expenditure estimates for 1976-77? Has it examined these reports? If not, when will it do so?

Mr MALCOLM FRASER:
LP

– Early in March the Government did get initial reports from departments concerning estimates for expenditure next year. Those initial reports were based on the programs of the Government as they were at the time. Many of these had been inherited of course from the previous Government or from even earlier times. Those early reports indicated a widening deficit. As a result the Government asked a group of officials to examine these matters and report to it by 15 April. That report was provided to the Government by that date. It was done in the knowledge of some of the aspects on which Sir Henry Bland will be reporting. The report does not pre-empt further reports that will come from Sir Henry Bland.

The time has now come, after initial examination by a few senior Ministers, for the matter to be examined by the Government and the Ministry as a whole and meetings have been called for Friday, Saturday and Sunday of this week to examine these estimates of expenditure. Quite obviously, the examinations will be lengthy. They will be examinations in depth of the expenditures of the Commonwealth Government. I might add that we have reiterated our firm determination to overcome inflation as a pre-requisite to establishing confidence in consumers and confidence in business so that investment can move forward and jobs can be created, as I believe all members of this House would want. The examinations that will take place over the weekend will lead to a significant economic statement by my honourable colleague the Treasurer before we rise for the winter recess.

page 1995

QUESTION

PREMIER OF QUEENSLAND

Mr E G Whitlam:
WERRIWA, NEW SOUTH WALES · ALP

-Has the Prime Minister received correspondence from the New York investment banker who was appointed by the Premier of Queensland as his financial adviser and who accompanied the Agent-General for Queensland and Mr Wiley Fancher to Switzerland last November? Has he replied to him?

Mr MALCOLM FRASER:
LP

-There is some correspondence that I think it unnecessary to reply to. The correspondence to which the honourable gentleman refers was correspondence that I believe it unnecessary to reply to because it does not in any sense, shape or form involve the Commonwealth Government. The Commonwealth Government certainly had no knowledge of the nature of any correspondence that might have taken place and is not a party to it and has no intention of being a party to it.

page 1995

QUESTION

UNITED KINGDOM PAY RISES

Mr William McMahon:
LOWE, NEW SOUTH WALES · LP

– I address my question to the Minister for Employment and Industrial Relations. Has the Minister been informed that the British Trade Union Conference and the British Government have in the national interest agreed to limit pay rises to 4.5 per cent next year with a maximum of $A6 a week and a minimum of $A2.50 a week? Has the Minister also been informed that the British Government’s expectation is that this would halve the inflation rate in the United Kingdom in 1977 and would bring the rate down to about 10 per cent? Will he inform Mr Hawke, the President of the Australian Council of Trade Unions, of the statesmanlike and strong support by Mr Len Murray, the General Secretary of the British Trade Union Conference, and ask Mr Hawke whether he will, in Australia’s interest, take a similar national and statesmanlike approach to that problem too?

Mr STREET:
Minister Assisting the Prime Minister in Public Service Matters · CORANGAMITE, VICTORIA · LP

– I have noticed recent reports in the Press and elsewhere relating to the recent agreement which has been reached in the United Kingdom on the question of wage increases in line with the figures that the right honourable gentleman has given. I would like to commend the highly responsible attitude which has been shown by leaders of the trade union movement in that country. The fact is that excessive wage rises cannot benefit anybody; certainly not wage earners who will soon find that the gains are illusory and that their jobs are put at risk; certainly not the unemployed whose prospects of getting a job are reduced; certainly not the retired who are seeing their savings eroded by the vicious effects of inflation; certainly not the young whose prospects and hopes of owning their own home are diminishing with skyrocketing building costs; certainly not the selfemployed who have no recourse to any automatic form of wage or salary increase; and certainly not Australian exporters who are now facing a steadily deteriorating position in relation to our major trading partners.

Australia has an inflation rate of 13.4 per cent, Japan 9.4 per cent and the United States of America 6.3 per cent. The average for all countries belonging to the Organisation for Economic Co-operation and Development is 9.3 per cent. It is vital for economic recovery in Australia that wage increases not exceed the capacity of industry to pay. If they do, an inevitable result will be a decline in industrial activity. I sincerely hope that Mr Hawke, the leaders of the trade union movement in this country and all sections of the Australian community will join this Government in its attack on inflation. It is in everybody’s interest to do so. We must control what is undoubtedly the greatest threat to Australia’s achieving what all of us know this country is capable of achieving.

page 1995

QUESTION

DEATH OF AUSTRALIAN JOURNALISTS IN TIMOR

Mr UREN:
REID, NEW SOUTH WALES

– I direct a question to the Prime Minister. He would be aware that Mr Jose Martins, the President of the Kota Party of East Timor, is now in Australia, having been brought here by the Victorian branch of the Australian Journalists Association. I ask the Prime Minister whether his Government will extend Mr Martins’ visa and arrange for the Joint Parliamentary Committee on Foreign Affairs and Defence to interview Mr Martins concerning the death of the 5 newsmen at Balibo in East Timor.

Mr MALCOLM FRASER:
LP

– I think arrangements have already been made for officers of the Department of Foreign Affairs to have discussions with the gentleman concerned and with the Australian Journalists Association arising therefrom. I believe the appropriate step would be for that course to take place before other decisions are made.

page 1995

QUESTION

LOCAL GOVERNMENT FINANCE

Mr WILSON:
STURT, SOUTH AUSTRALIA

– I direct a question to the Prime Minister. Is the Grants Commission currently engaged in preparing a report on the proportion of the local government share of income tax which should be allocated to each of the States? If local government bodies are to receive an early indication of their individual shares of these allocations, is it essential that State grants commissions be established by State parliaments as soon as possible? Should local government in South Australia be concerned that to date no announcement has been made by the State Government that a State grants commission will be set up at a session of the State Parliament convened for the purpose?

Mr MALCOLM FRASER:
LP

– The Grants Commission is at present engaged in an examination that would define the nature of local government because the definitions of local government are different in different States. That affects particularly the honourable gentleman’s State because it has large unincorporated areas. The Grants Commission is also engaged in determining the proportions of whatever sum the Commonwealth in the initial stage determines should be made available to local government that should go to local government in each State. It will not be a quantitive answer, it will be a proportional or relative answer that will come from the Grants Commission in relation to that matter.

Mr Innes:

– I take a point of order. I know that the Prime Minister’s back is better than his front, but -

Mr SPEAKER:

– Order! The honourable gentleman will make his point of order.

Mr Innes:

– The point of order is that the Prime Minister continually turns his back on a section of the chamber. It would be better if he spoke into the microphone so we could hear what he has to say.

Mr SPEAKER:

– The Prime Minister is trying to be courteous to the questioner. It is not possible for the right honourable gentleman to answer a question from the honourable member for Sum, who sits at the back of the House and on the right of the Chair, without turning his back on somebody. The right honourable gentleman will pursue his answer in his courteous fashion.

Mr MALCOLM FRASER:

– Thank you, Mr Speaker. I repeat that the Grants Commission is currently engaged in determining the proportions of whatever sum the Commonwealth determines should be available for local government in the next financial year that should go to each State. It has been agreed by all Premiers at a Premiers Conference that the part which should go for equalisation or topping up grants within a State should be allocated on the basis of recommendations of local grants commissions. It will be important for local grants commissions to be established at an early date so that they can make their own investigations of the particular needs of municipalities within their own States. It was my understanding that in South Australia such processes were proceeding. If they have not yet been announced and made public, I can only urge that in that State, in the interests of local government, the measures be put under way as quickly as possible.

I should mention also that a working party of officials from all the States and the Commonwealth has been set up to determine the criteria that ought to be taken into account in determining the allocation of funds within a State. So far, widely differing views have been expressed by the States concerning that part of the grant going to local government which ought to be on a fixed formula basis- going to all local governments either on a per capita basis or perhaps on a per capita basis weighted for area- and that part which ought to go to local government on an equalisation basis on the determination of State grants commissions. The working party is designed to isolate for governments the considerations that ought to be taken into account in determining intrastate allocations. These matters will be available to be discussed at the next Premiers Conference early in June. I certainly hope that long before that date all the States will have their mechanisms under way and in force so that they can take part in the procedures early and quickly, to the advantage of local government. The only other point I would like to make is that the Government has announced its firm intention that local government will participate in the new procedures from the beginning of the next financial year. Therefore, the States ought to be in a position as soon as possible to advise their own local governing authorities.

page 1996

QUESTION

PREMIER OF QUEENSLAND

Mr E G Whitlam:
WERRIWA, NEW SOUTH WALES · ALP

– I ask the AttorneyGeneral a question. On how many occasions has he conferred with the Premier of Queensland since he became Attorney-General? Who has accompanied the Premier? In particular, how often has Mr Wiley Fancher accompanied the Premier?

Mr ELLICOTT:
Attorney-General · WENTWORTH, NEW SOUTH WALES · LP

-I have not kept any statistics about the number of times I have conferred with the Premier of Queensland in that period. I cannot answer the question.

page 1996

QUESTION

MINING INDUSTRY

Mr KATTER:
KENNEDY, QUEENSLAND

-My question is directed to the Minister for National Resources. Will he indicate to the House the present condition of Australia’s revived raining industry and provide a comparison with the dismal, disastrous, abortive , and stagnant 3 years of decline in the industry when Labor was in power?

Mr ANTHONY:
NCP/NP

– I think it is fair to say that the Australian mining industry is still shocked and shattered as a result of the management and directions given to it by the Australian Labor Party Administration. Labor treated people in the industry as hicks and hillbillies, and disregarded the very important contribution that this great industry makes to the Australian economy. In fact, I think it is fair to say that during the 3 years Labor was in office not one major new development project took place. Probably worse still for the long term benefit of the industry is the fact that oil exploration declined very rapidly- it nearly ceased- and only one off-shore rig is operating at the moment.

Since we came into office we have slowly been building up the confidence of the industry towards reinvesting. We have talked to the industry- that is not very difficult for a government to do, but it did not happen under the previous Government- and the industry understands quite clearly that we will apply export controls merely as a monitoring device to ensure that the national interest is protected and not as a bureaucratic device unduly interfering with the industry’s performance. We have laid down quite clearly our guidelines for foreign investment in Australia. Our aim is to give Australians the opportunity of at least 50 per cent participation in development projects, with the exception of uranium. But if it can be shown that Australian capital cannot be raised for these developments, certainly a lower percentage of Australian equity will be allowed. The Government announcement on an investment allowance of 40 per cent has a bearing on the mining industry.

Of course we will look with great interest at the report of the Industries Assistance Commission regarding tax incentives for the industry. These were all virtually taken away by the previous Government. Although it is difficult for us to give much encouragement in our present economic situation this is something that has to be looked at. But by far the most important single aspect for our mining industry is whether we can bring inflation in Australia under control. If that cannot be brought under control, even though we may have some of the best and richest deposits in the world, there is no future for these deposits if wages and costs escalate to the point where the mineral deposits cannot be extracted profitably.

page 1997

QUESTION

TELEVISION LICENCES

Mr Les McMahon:
SYDNEY, NEW SOUTH WALES · ALP

– My question is directed to the Prime Minister. Having in mind that a licence fee of $90 a year for a colour television set represents more than 10 per cent of the original cost of a set, I ask: Has his Government completed its consideration of his proposal to impose an annual licence fee of $90 for a colour television set? When will he announce his decision?

Mr MALCOLM FRASER:
LP

– I thank the honourable gentleman for his question because it gives me an opportunity to indicate that some reports that have appeared in recent times on this particular matter seem to exhibit an extreme degree of fantasy.

page 1997

QUESTION

AIR SERVICES TO BALI

Mr COTTER:
KALGOORLIE, WESTERN AUSTRALIA

-Is the Minister for Transport aware of applications by Western Australian Airlines to fly direct overseas flights from Port Hedland to Bali? Does the Minister agree that this would mean that there would be considerable savings on fares to the 40 000 people of the Pilbara, and indeed to the people of Western Australia, who may wish to travel to Bali? What difficulties, if any, would arise in granting permission for these flights?

Mr NIXON:
Minister for Transport · GIPPSLAND, VICTORIA · LP

– There are 2 applications for air charter flights from Western Australia to Bali. I have sent a request to the Department of Transport to give me a report on these applications. The matter is not as simple as one would at first assume because it involves, of necessity, government agreement between Indonesia and Australia on any changes in air flights affecting both those countries. This matter has been put to study. I hope to be in a position to say something about it within the next few weeks. I appreciate that the people who live in the Pilbara region would find it attractive to have a direct service from their area to Bali. I agree with the honourable member’s suggestion that the level of fare would be lower for those people. But I have to say that in terms of the total level of fare required for, say eastern holiday makers who might want to travel to the west and then go to Bali by the proposed charter flights, the fares would be no cheaper than the rates on present routes already serviced by Qantas.

page 1997

QUESTION

UNION MEMBERSHIP

Mr DRUMMOND:
FORREST, WESTERN AUSTRALIA

– Is the Minister for Post and Telecommunications aware of the industrial dispute centred around one Roger Dracup in Busselton, Western Australia? Is it a fact that Mr Dracup is acting within his rights by not joining the Australian Postal and Telecommunications Union? Is there anything that the Minister can do to see that this man’s rights as an individual will be safeguarded? Finally, I understand that a compulsory conference called by Commissioner Payne will be held today in an endeavour to resolve the situation. If this is unsuccessful, as the 2 previous conferences have been, what is the likely outcome of the situation?

Mr Eric Robinson:
MCPHERSON, QUEENSLAND · LP

-I have been aware of this problem for some days now. Indeed it concerns, as the honourable member for Forrest has said, a Mr Dracup who joined the Australia Postal Commission service on 9 February. He did not join the union: He was subsequently approached by the Australian Postal and Telecommunications Union and refused to join it. Of course, that is his right and his entitlement in a democratic country.

Mr Sullivan:

– He will learn.

Mr Eric Robinson:
MCPHERSON, QUEENSLAND · LP

-I heard an honourable member interject: ‘He will learn’. He has been told by the Postal Commission that the policy of the Commission is to encourage organised unionism, but, of course, no attempt has been made to influence him.

Mr Scholes:

-Talk to Charlie Court -

Mr Eric Robinson:
MCPHERSON, QUEENSLAND · LP

– That is all very well, but this could well mean a total mail ban in Western Australia, and that is pretty serious.

Mr Scholes:

– At the request of the Premier -

Mr Eric Robinson:
MCPHERSON, QUEENSLAND · LP

– What about listening to the facts? The honourable member will then get the matter in some sort of perspective. First of all, bans were imposed on the mail for Busselton. An attempt was made to mediate. As the honourable member for Forrest would know, because it is in his electorate, an attempt was made on more than one occasion to mediate. At one stage Mr Dracup resigned. Then, of course, all the bans were lifted. He then reconsidered his decision to resign and withdrew his resignation. Again, as honourable members will know, he is entitled to do that. So, of course, the bans were immediately reimplemented. The Federal Executive of the APTU then said: ‘If we cannot fix this matter in a limited way we will consider a State-wide mail ban’. What has happened up till now is that a limited ban has been imposed. As the honourable member has rightly said, Mr Commissioner Payne has convened a hearing for, I think, 2.30 this afternoon Perth time. I hope that reason and common sense will prevail because if they do not and Mr Dracup ‘s rights have to be protected, we could have a very serious situation on our hands in regard to the mail service in Western Australia.

page 1998

QUESTION

REGIONAL EMPLOYMENT AND DEVELOPMENT SCHEME

Mr STREET:
LP

-The honourable member has raised an issue which I know is of great concern to many local government authorities and other sponsors of RED scheme projects. The fact of the matter is that the previous Labor Government in I think September or October of last year informed the sponsors of projects that no increases in costs due to escalation in wages could be funded. Until that time there had been some funding of such increases. The previous Government made a decision that the total amount of money available to the RED scheme should not exceed the budgetary allocation of $135m. That decision was subsequently confirmed by the present Government.

At the moment the RED scheme is in the process of being wound up. Some projects are still going and it is very difficult to know exactly what the total cost of the scheme will be, bearing in mind the fact that we cannot exceed the $135m allocated in the Budget. However, it has been possible, now that the end of the scheme is in sight, to fund some increases in costs due to the escalation of wages up to 10 September 1975. The sponsoring organisation already have been informed that any escalation due to wage rises after that period cannot be funded. I am in the process of going through the details of all the relevant projects which might be entitled now to some recompense for increases in costs due to an escalation in wages prior to 10 September 1 975. 1 am sure the honourable member will appreciate that with the thousands of projects which were involved this is a substantial task, but I have asked that it be done as soon as possible. Those organisations which are to be entitled to some compensation for the type of cost I mentioned will be informed as soon as I can arrange it.

page 1999

QUESTION

MOTOR VEHICLE PLAN

Mr YOUNG:
PORT ADELAIDE, SOUTH AUSTRALIA

– I direct my question to the Prime Minister. I preface it by saying that we on the Opposition side of the House are very much aware of the difficulties of adopting an automotive industry plan for this country which is all things to all men. However, I ask the Prime Minister whether he is aware of the effects of the removal of the non-reversion rule on the automotive component industry in Australia. Does he realise that the removal of that rule prior to the consolidation of the old and new automotive manufacturers in Australia could have a devastating effect on the component industry? Is he aware that the honourable member for Melbourne, the honourable member for Corio and I made these predictions in our statements to the House on the new car plan? Will the Prime Minister institute an instant inquiry into the effects on the component industry of Australia of the removal of the non-reversion rule?

Mr MALCOLM FRASER:
WANNON, VICTORIA · LP

– On the information available to the Government, with the adoption of the car plan, as it has been announced and subject to negotiations that are still proceeding on elements of the plan of which the honourable gentleman would be well aware, it would be the general expectation that overall employment will rise in the motor vehicle industry over coming years largely because of the introduction of much greater Japanese manufacturing in Australia. To some extent that will offset any implications contained in the elements involved in the honourable gentleman’s question. I will refer the matter to my colleague, the Minister for Industry and Commerce, who will be able to specialise in this matter, as does the honourable gentleman.

page 1999

QUESTION

MEDIBANK CLAIM FORMS

Mr MILLAR:
WIDE BAY, QUEENSLAND

– In view of the number of complaints from elderly people required to complete Medibank claim forms, I ask the Minister for Health whether steps are being taken to replace the existing form with one less complex in detail and less cumbersome in size.

Mr HUNT:
NCP/NP

-There have been a number of representations on this matter, and I am grateful for the representations that the honourable member for Wide Bay has made on the issue. It has been the subject of an investigation by the Medibank Review Committee. I will be considering any alterations that should be made to the claim forms when I receive the Committee’s recommendations.

page 1999

QUESTION

BUDGET DEFICIT

Mr HAYDEN:
OXLEY, QUEENSLAND

– I ask the Treasurer a question. As comments about the size of the Budget deficit, especially in economic circumstances such as apply now, are not particularly illuminating unless related to the well known economic management concept of a full employment deficit, will he say what is the level of the full employment deficit according to the most recent assessment available to him?

Mr LYNCH:
Treasurer · FLINDERS, VICTORIA · LP

– I find it completely ironic that the honourable member for Oxley, the immediate past Treasurer of this country, should ask in this House a question as to the present level of the deficit and then raise what he referred to as the full employment deficit, because the honourable gentleman will well recall that he, as Treasurer, received question after question on the matter from the former Opposition. He refused consistently to answer all those questions. He was never prepared to say in this House what the extent of the Budget deficit in prospect was even to the nearest $l,000m. He will also remember full well that in Opposition as the then shadow Treasurer I challenged him consistently to deny that his own projected Budget deficit figure of $2.8 billion was phoney. That he refused to do time and time again. I challenged the honourable gentleman then to come clean and say the Budget deficit under the Australian Labor Party Administration would in fact hit $4 billion. That he refused to do.

I remind the honourable gentleman, who obviously is somewhat upset by the recollection of the sins of the past, that when the Budget deficit was estimated during December it was running, on the basis of the best advice available to the Government, at $4.7 billion. My own estimates would be that, had the Labor Party remained in power, the Budget deficit would have been between $5 billion and $6 billion. Having said all of that and having drawn attention to the honourable gentleman’s consistent refusal to provide the information, let me say that I will not provide to him the estimate of what has been referred to as the full employment Budget deficit. The honourable gentleman well knows the difficulties of providing that estimate. I say to him, as a matter of firm assurance, that the deficit this year will be considerably less than it would have been had he been the Treasurer of this country. He would have put up a deficit of between $5 billion and $6 billion. The deficit in prospect, I confidently believe, will be less than $4.2 billion, and I reiterate that the honourable gentleman was never prepared to put such an estimate on the public record.

page 2000

QUESTION

PROPOSED SECOND AIRPORT FOR SYDNEY

Mr BAUME:
MACARTHUR, NEW SOUTH WALES

-I direct my question to the Minister for Transport. Is there any conflict, as reported, between statements made by the Minister and those of Sir Eric Willis relating to official investigations into a second airport for Sydney? The Minister will understand my concern as the Bringelly-Rossmore area in my electorate has been reported as a possible site for such an airport.

Mr NIXON:
LP

-This matter first came to the attention of the House when the honourable member for Hunter asked a question about it the other day. I have deliberately refrained from confirming prospective sites for a new aerodrome in the Sydney area- if one is felt to be needed. The reason I have done that is that I thought I had spelt it out quite clearly in the House and I certainly did so on television and radio and in Press comment afterwards. I said specifically that until the new government is confirmed in New South Wales I do not feel I am in any position to take the matter further. There has been no discussion at a ministerial level on this matter. I am waiting for the confirmation of the new government. The matter of the Sydney airport will then be taken up again. There is no conflict between the position as stated by Sir Eric Willis and the position I have been stating quite firmly in the last few days.

Mr Morris:

– You misled the House.

Mr NIXON:

– As for misleading the House, the honourable member for Shortland ought to take a lesson from his Leader as to what misleading the House is all about.

page 2000

QUESTION

TELEVISION LICENCES

Mr MALCOLM FRASER:
LP

– With your indulgence, Mr Speaker, may I add briefly to an answer I gave earlier?

Mr SPEAKER:

-Indulgence is granted.

Mr MALCOLM FRASER:

– I have been advised by one or two honourable members that they thought that an answer I gave about television licence fees left the position in some doubt. It certainly was not meant to. The newspaper reports were fanciful; they were without foundation. There has been no proposal before the Government.

page 2000

URBAN AND REGIONAL DEVELOPMENT (FINANCIAL ASSISTANCE) ACT

Mr MacKELLAR:
Minister for Immigration and Ethnic Affairs · Warringah · LP

– Pursuant to section 8 of the Urban and Regional Development (Financial Assistance) Act 1974-1975, I present an agreement between the Commonwealth of Australia and the State of Western Australia over the provision of financial assistance for urban expansion and redevelopment (Moore River study) 1975-76.

page 2000

ABORIGINAL HOSTELS LIMITED

Mr VINER:
Minister for Aboriginal Affairs · Stirling · LP

– For the information of honourable members I present the first annual report of Aboriginal Hostels Limited covering the period to June 1975.

page 2000

BILINGUAL EDUCATION PROGRAM IN NORTHERN TERRITORY SCHOOLS

Mr VINER:
Minister for Aboriginal Affairs · Stirling · LP

– For the information of honourable members I present the second progress report on the bilingual education program in schools in the Northern Territory together with a statement by the Minister for Education relating to that report.

page 2000

AUSTRALIAN CAPITAL TERRITORY STATEMENT OF RECEIPTS AND EXPENDITURE 1974-75

Mr STALEY:
Minister for the Capital Territory · Chisholm · LP

– Pursuant to section 10 of the Seat of Government (Administration) Act 1930-1973 I present the statement of receipts and expenditure relating to administration and development of the Australian Capital Territory for the year ended 30 June 1 975.

page 2000

REMUNERATION TRIBUNALS ACT 1973-1975

Mr STREET:
Minister for Employment and Industrial Relations · Corangamite · LP

– Pursuant to section 7 (7) of the Remuneration Tribunals Act 1973-1975 I present a copy of Remuneration Tribunal determinations relating to the Chairman of the Interim Darwin Reconstruction Commission, and the Schools Commission part-time chairman of planning and finance committees- New South Wales, Australian Capital Territory and Northern Territory.

page 2001

SPECIAL ADJOURNMENT

Motion (by Mr Howard) proposed:

That the House, at its rising, adjourn until Tuesday, 18 May at 2. 1 5 p.m. unless Mr Speaker shall, by telegram or letter addressed to each member of the House, fix an earlier day of meeting.

Mr SCHOLES:
Corio

-For the convenience of honourable members and because we are all subject to rumours at this stage of a session, I ask the Minister for Business and Consumer Affairs (Mr Howard) whether he is in a position to indicate whether the circulated program for the sittings of the House is likely to be adhered to. Also I understand that a motion was to be moved, although it does not appear on the notice paper, to extend the trial period of 5- minute speaking times in adjournment debates. Can the Minister inform the House briefly whether he has any information on this matter?

Mr HOWARD:
Minister for Business and Consumer Affairs · Bennelong · LP

– Regarding the first matter, I recognise that it is a fair question. I will endeavour to inform the House of the situation later in the day. I am sure that the Opposition will give me leave to do so. So far as the second matter is concerned, I am not aware of the position. I will investigate the matter and let the honourable gentleman know.

Mr Scholes:

– The trial period will expire tonight.

Mr HOWARD:

– That is so.

Question resolved in the affirmative.

page 2001

NATURAL DISASTER INSURANCE SCHEME

Suspension of Standing Orders

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

That so much of the Standing Orders be suspended as would prevent the honourable member for Hawker and the honourable member for Balaclava each speaking for a period not exceeding 30 minutes.

Mr JACOBI:
Hawker

– I move:

That, in the opinion of this House, the Government should implement forthwith a natural disaster insurance scheme.

Regrettably, Australia has been and will continue to be devastated by one type of natural disaster or another, each with varying degrees of intensity and devastation. Natural disasters will strike whenever or wherever they will. We as a national Parliament have a responsibility to extend to the people as far as is legislatively practicable the maximum cover and security possible. This can be achieved by taking a number of initiatives. The most important is the implementation of a natural disaster insurance scheme. For the past 3 years I have struggled for its adoption and the first break through came with the acceptance in principle of the need by the former Treasurer, the honourable member for Oxley (Mr Hayden), last November. To the honourable member for Oxley goes the real credit for this initiative becoming a national commitment. Equally welcome was the response of the Treasurer (Mr Lynch) in answer to my question on 4 March when he committed this Government to the implementation of such a scheme.

Floods, earthquakes, bushfires and cyclones in recent times have battered insurance companies nearly as much as their clients. Sections of the insurance industry have alleviated much of the hardship associated with natural catastrophes. The number and magnitude of disasters in recent years have threatened the solvency of insurance companies to such a degree that they have been left with no room to manoeuvre in upgrading insurance cover in this field. We need only recall cyclone Tracy and the 1967 Tasmanian bushfire to realise the devastation that can be wrought by nature when unleashed. After both disasters we were faced with the enormity of human suffering, loss of life, destruction of property and the economic hardship and dislocation inflicted by these things. Cyclone Tracy highlighted the need for a better system of natural disaster insurance. The magnitude of the devastation in Darwin took insurers by surprise. Cyclone Althea, previously Australia’s most destructive cyclone, hit Townsville in 1971 and caused damage estimated at less than 10 per cent of the sum insured. Cyclone Tracy, on the other hand, caused damage estimated to cost between 80 per cent and 90 per cent of sums insured which made it the most disastrous loss in insurance history. It even surpassed the 1906 San Francisco earthquake. I seek leave to incorporate in Hansard a table setting out the major natural disasters which occurred between 1939 and 1976.

Mr SPEAKER:

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

Mr JACOBI:

-The insurance payout of $220m for damage caused by cyclone Tracy, just over 25 per cent of the total financial loss, and almost $ 100m for damage caused in the Brisbane flood of the same year, compares with an estimated total Australian annual premium income of $340m for fire and associated insurance. The massive losses suffered by insurance companies in these and subsequent disasters have resulted already in very much higher premiums. Without a nationwide natural disaster insurance fund the losses in high flood risk or high cyclone risk areas are potentially so great that premiums are, or soon will become, prohibitive. The result is that people may prefer to chance the event of disaster or under-insure rather than pay high insurance rates and this is a very unhealthy situation. Another example is the Hobart bushfire where the real financial loss will be nearly $ 100m when the insurance payout was only $ 1 4m.

I want to refer to 2 examples of the increase in insurance premiums. Post cyclone Tracy Darwin, insurance for a $25,000 home now costs about $75 a year if brick and $ 165 if weatherboard. In post flood-prone Brisbane the increase is more dramatic. The State Government Insurance Office wanted $625 a year plus a 20 per cent excess charge for damage for one house valued at $15,000. Another home owner paid $31.05 before the flood for all insurance inclusive of flood but now faces a payout of $244 for flood cover only. We in the national Parliament cannot ignore or dismiss the probability of similar disasters occurring time and time again and we ought to face reality. The escalating cost of disaster insurance and consequent under-insurance is aggravated by inflation. The $220m insurance payout in Darwin represented a little over onequarter of the total damage and the all-up cost will be closer to $800m. Had insurance been kept at current replacement value by residents, the financial shock to insurance companies could have been fatal to many insurers.

Australian insurance companies have been spared the full impact of the devastation thanks to reinsurance. Less than 30 per cent of the insurance bill was met by insurance companies. The rest of the payout was met by overseas reinsurers, namely $180m. A further casualty, and a very costly casualty to each and every one of us, has been the marked escalation in the cost of catastrophe insurance. In general terms, since cyclone Tracy the cost of this type of insurance throughout Australia has risen three to five times. This is compounded by the increase in and concentration of property values which is continually escalating the degree of damage which could be caused by a given disaster.

Another unsatisfactory aspect of the present disaster insurance provisions is the exclusion of flood cover in the fine print of most policies. The hostility levelled at most insurance companies stems from the 1974 Brisbane flood and recent New South Wales floods when most people, regrettably, found that their policies did not cover flood. A natural disaster insurance scheme would remove this uncertainty. Failing this, my request to the Attorney-General (Mr Ellicott) for a reference to the Law Reform Commission dealing with the wording of insurance contracts is a matter of urgency. At this point we should consider the stark assessment in the report of the Insurance Committee on Natural Disaster Insurance on cyclone Tracy, I quote:

If we assume a damage distribution based on an arithmetic progression with the most destructive cyclone being ‘Tracy we arrive at the following conclusion: Darwin would be destroyed 4.675 times in 200 years.

Although this raises serious questions about Darwin’s propensity for survival, having regard to its location, we must look at the existing provisions for natural disaster insurance. The existing provisions for natural disaster insurance are totally inadequate. Preoccupation with their own survival means that insurers are in no position to cater for natural disaster insurance at a reasonable rate. The concept of governments giving ad hoc payments to disaster victims is unsatisfactory from many points of view. For the Government, relief handouts considerably increase the strain on Federal budgeting. Also, it is difficult to determine fair and adequate compensation when no records of property are kept. This is quite apart from the tremendous replacement cost carried by Federal, State and local government. A natural disaster insurance fund, built up over the years and drawing premiums from all over Australia to spread the cover, would alleviate the many shortcomings in the present scheme, or more correctly the lack of such a scheme. There are many alternative approaches to the operation of such a fund but the requirements of any scheme obviously are universal.

Firstly, natural disaster insurance should be available to all Australians at reasonable cost. Secondly, the insurance fund should be able to meet all but the worst disasters from its own resources. In the event of government support being required to boost the fund in times of acute disaster, the fund could repay the Government when capable of doing so. Thirdly, maximum participation in the scheme is desirable. Fourthly, the present uncertainty of assistance in times of disaster should be removed. Fifthly, people should be encouraged to take measures to assist themselves rather than rely on government or private charity. Sixthly, the scheme will need insurance expertise and resources and it is desirable that existing arrangements for this type of insurance be absorbed painlessly into any new scheme. Finally, if maximum benefit at minimum cost is to be achieved by any insurance measures, it is essential that constructive disaster mitigation policies are enacted. Building in high risk areas or building sub-standard structures could be penalised by higher premiums.

One of the basic decisions a government will have to make before it sets up such a fund is the degree of involvement the Government is prepared to make to the scheme. The inability of insurance companies to adequately cope with the situation at present demands at least some participation by the Government. Bearing this in mind, one ought to define what is meant by ‘fund’ or ‘scheme’. Do we mean a fund created to extend cover to and created from the whole nation to help in a natural disaster? It could be said that we are not talking about insurance, we are not talking about civil defence or war damage; we are talking about a fund to cover flood, cyclone, drought, land-slip, earthquake, bushfires and any other disaster not readily or properly insurable.

The Government could administer a fund entirely by itself, collecting its own premiums, making payments in time of catastrophe and investing the premiums to build up sufficient funds. A satisfactory way of financing the fund would be to impose a levy on income. Such a scheme would provide universal coverage. The poor, who have few assets to lose, would contribute very little, while the wealthy, who have many assets, obviously would pay more. The money would be easy to collect; insurance companies would be free to transact fire insurance in the normal way. Alternatively, the Government could underwrite insurance in risk areas where the industry is unable or unwilling to provide the cover. The Government could subsidise disaster premiums collected by insurance companies or it could leave the administration of the fund entirely in the hands of the industry, except that the Government would act as a lender of last resort in the event of the fund being exhausted by a catastrophe. The Government would also need to decide how the fund was invested to achieve a reasonable return with maximum security.

There are other important questions. For instance, what types of risks are to be covered by disaster insurance and what level of reinsurance, if any, could or should be arranged? Should disaster insurance be restricted to private dwellings or should it encompass commercial structures? Further, should the scheme be extended to cover crops or livestock? Experience in the United States has shown that farmers are finding complete crop insurance is becoming more and more a necessity because of the impact of inflation on the cost of farming and the value of crops being subject to the vagaries of nature. Furthermore, increasing numbers of lenders are refusing to lend farmers money unless they insure themselves against all types of peril. The point has been reached where not only farmers but the United States Government itself cannot afford to be without an all risk farm insurance scheme. In addition to payments made under the United States Department of Agriculture’s Federal Crop Insurance Corporation, the United States Government also paid out US$2 70m in 1974 and US$555m in 1975 as compensation for crop losses, without the benefit of premium dollars corning in. Surely farmers want coverage that fully meets their needs rather than handouts. Private insurance companies in the United States are presently urging an association with their Federal Government to provide extensive crop insurance. The situation in this country is not so different from that in the United States. Stock and farm losses in the region of $50m in northern New South Wales and Queensland in the February 1976 floods are a reminder of the high cost of natural disasters to rural industry.

Returning to the question of property cover, a natural disaster insurance scheme which Australia could well emulate is the New Zealand model introduced in that country during the last war. Insurance companies impose a levy of 0.05 per cent of the insured value of buildings, which is added to fire insurance premiums. The levy is paid into a public account known as the Earthquake and War Damage Fund. In the event of a disaster covered by the terms of the New Zealand Act- and I might add that it is rather restrictive- the Government administers payments to affected residents. Administration costs are met out of the fund. The Commission uses its power to control the locations and standards of buildings. From 1941 to March 1974 earthquake, storm and flood premiums in New Zealand had realised $130m plus accumulated interest of $77m. The total surplus in the fund at March 1974 was $ 190m- a significant amount to meet disaster in a country the size of New Zealand- yet the staff of the Commission administering the fund is only six.

In Australia there could be a need for differential levies in high risk areas. The northern Australian coastline in particular is susceptible to tropical cyclones. It has been estimated by insurance companies that levies as high as 0.3 per cent on insured values in these areas would still fall short of providing a self-supporting scheme in northern Australia alone. In the interests of decentralisation and defence some of the burden for cyclone damage will have to be borne by residents in the south of Australia.

While cyclones and storms in the tropics have dominated natural disaster headlines in this country over the past few years, our southern cities are by no means immune from flood. In the great Sydney flood of 1873 a river 4 feet deep flowed down Pitt Street. Drainage engineering has improved since 1873 and could cope with most situations today, but obviously doubts must remain as to what would happen should maximum possible rainfall occur. Quite recently 7 people lost their lives in a flash flood in Canberra. One would think that this planned city would have an adequate drainage system.

A report recently released by the Engineering and Water Supply Department in my own city of Adelaide has raised the possibility of severe flooding from the River Torrens. A flood of this nature would have a return period of 100 years or so, the last major flood of the Torrens being in 1889. What worries me is that because of the rarity of flooding in Adelaide very few householders have taken out special flood insurance. Consequently many Adelaide citizens would suffer real hardship in the event of a big flood unless they are given protection by a scheme such as I have mentioned. In Adelaide great damage could come from earthquake. In 1954 a medium sized earthquake of Richter magnitude 5.5 struck the city of Adelaide, causing about $8m damage- estimated to be equivalent to $30m at today’s values. This is just one-third the insurance market loss caused by the 1974 Brisbane flood and is the same as the loss inflicted upon Townsville by Cyclone Althea in 1971. Were a similar size earthquake to occur the loss to property would be considerably higher in Adelaide for 2 reasons: First, the urban development has expanded south of the city where damage was highest on the last occasion, and secondly, property values have soared in the intervening period. In fact this was only a small to moderate size earthquake. The maximum credible earthquake would be of the Richter magnitude of 6.5 to 7 and would be located even closer to the city on either the Eden, Burnside or Para faults, which all appear to be active. Such an event has a low but finite probability of occurrence. Other damaging earthquakes have occurred this century in every State and we ought to take note of the fact. The most notable occurred in Warrnambool, Victoria in 1903; Meckering and Perth, Western Australia, in 1968 and in Picton and Sydney, New South Wales, in 1973. Incredibly and fortunately no one has lost his life as a result of an earthquake in Australia.

In conclusion, I should like to say that a natural disaster insurance scheme should form part of a wider commitment to disaster control and relief. A natural disaster organisation was set up by the former Labor Government to encourage greater disaster preparedness and to provide assistance and relief in the event of a disaster. Fortunately the organisation was set up and operative before cyclone Tracy in 1974.

Another step which should be taken by the Government is the setting up of a disaster research unit, interlocked with the Bureau of Meteorology for climatic forecasting, to study ways of reducing the damage and suffering from natural disasters. It is worth noting that if equal emphasis had been given to the study of seismology to that given to meteorology from the beginning of this century we would by now have sufficient data to zone confidently the whole of Australia into areas of high and low seismic risk and be able to extrapolate the probabilities of less frequent but more damaging earthquakes.

What is needed to complete this picture is one other intitiative which is interrelated with the establishment of a disaster research unit. We should in co-operation with the States, as far as that is legislatively possible, develop suitable building codes, prevent construction in flood zoned areas and so on. I find it regrettable that the building codes that were set up and structured after the Townsville cyclone as yet have not been applied by local government, building development companies or by the Queensland Government. Such safeguards would have the effect of mitigating as far as possible the effects of natural disasters and the devastation which is frequently caused.

Lord Casey once remarked: ‘Preserve us from the humiliation of the weather’. The devastation caused by natural disasters resulting in hardship, suffering, anxiety and loss of life is an ‘humiliation’ by which regrettably this nation will continue to be ravaged. Every State down the years has suffered from a major disaster of one kind or another. None of us- I repeat none of us- is immune. While governments cannot compensate for human suffering, they can, by the implementation of a natural disaster insurance scheme ensure that the financial hardship suffered by people unfortunate enough to be the victims of natural disasters will at least be minimised.

I suggest that a natural disaster insurance scheme is an issue which ought to commend itself to a bi-partisan approach. However, I warn the Treasurer (Mr Lynch) that neither this Parliament nor the people should tolerate a repeat performance of the previous Liberal-Country Party Government’s deplorable delay and failure to restructure the then outmoded General Insurance Act from 1969 until its defeat in 1972. The revamped but still inadequate Act was introduced by the Labor Government in 1973. Because of the failure to act quickly and effectively, even today thousands upon thousands of people are suffering hardship, anxiety and bankruptcy. I commend the motion to the House.

Mr DEPUTY SPEAKER (Mr Drummond:
FORREST, WESTERN AUSTRALIA

-Is the motion seconded?

Mr HAYDEN:
Oxley

– I have pleasure in seconding the motion. I believe that the honourable member for Hawker (Mr Jacobi) deserves the encouragement and support of the House for the consistently diligent and constructive way in which he has shown an interest in this very important issue. Australia is natural disaster prone. We all know from the bitter experience of so many floods, fires and wild elemental disturbances how costly these natural disasters can be and how severe they can be in terms of personal and social stress on the Australian community. I believe that what the honourable member had to say probably came as a shock to those who heard his speech to learn how prone Australia could be to earthquake disturbance. There have been some minor earthquakes in Australia. I believe from the general tenor of discussion in the community that there would be a popular belief that the likelihood of an earthquake disturbance is restricted to possibly a part of Western Australia, and for those with longer memories, to a part of South Australia. In fact, all Adelaide is exposable to a serious earthquake disturbance, as is a part of Victoria. It would undoubtedly surprise most people to learn that so too is Sydney.

These things are possible but not terribly probable. But nature is rather perverse in the way in which she responds to probability ratios. We do not know when these sorts of things may occur. Of course, Australia is particularly prone to natural disasters. The possibility is that, as great as the costs have been that we have had to face and as great as the disruption and the painfulness of social and personal distress that have flowed from those occurrences have been, we could face even worse occurrences in the future. I sincerely trust that this will not be the case, but it is a possibility. Accordingly, we need to address ourselves to this problem with considerable insight and to apply a great deal of discipline. In particular I am thinking of the discipline implicit in the appeal of the honourable member for Hawker, who has just completed his speech, when he suggested that there is room for a bipartisan approach on this great issue. I believe that there is. I believe that the daunting difficulties in many ways of trying to work out a practicable system of natural disaster insurance are such that we ought to get together to try to work out the best scheme possible for this country.

I would like to make a couple of quick observations about the cost of that insurance. The honourable member pointed out that the Brisbane floods and the Darwin cyclone devastation involved an insurance payout of $320m over an annual period in which premiums were about $340m. I know that it is popular to condemn insurance companies as nasty, greedy, grasping villains. Certainly this has been true on the occasion of major natural disasters in this country when understandably there is a high pitch of emotion, sometimes not terribly helped by the media. But the facts are that the insurance companies have to operate on a sound financial basis in spite of the incursion that these sorts of enormous costs represent.

I draw the attention of honourable members to the fact that the figures I have just cited are pretty clear evidence of the great difficulties that insurance companies have in trying to function and provide this sort of cover. I remember, when I was Treasurer, discussing the problems of natural disaster insurance cover by private insurance companies and the experiences we had had with the Insurance Commissioner within the Australian Public Service. It is quite clear that because of the sudden upsurge in the regularity with which these disasters are occurring and the extent of these natural disasters measured in all sorts of dimensions, Australian insurance companies have been finding extreme financial difficulty in maintaining their position. As the honourable member rightly pointed out, if any of the disasters had been only marginally greater in some respects a number of insurance companies would have gone to the wall and would have been unable to fund their liabilities. Significantly, overseas underwriters are displaying extreme, if not hyper-caution about providing insurance underwriting in Australia. The costliness of natural disaster insurance was summed up very neatly and dramatically by the honourable member.

Motion (by Mr Bourchier) put:

That the honourable member for Oxley be not further heard.

The House divided. (Mr Deputy Speaker- Mr P. H. Drummond)

AYES: 77

NOES: 31

Majority……. 46

AYES

NOES

Question so resolved in the affirmative.

Mr MACPHEE:
Balaclava

-The honourable member for Hawker (Mr Jacobi), like myself, has had a deep interest in this subject of natural disaster insurance for a long time. He began to make a very thoughtful and constructive contribution today. Despite the fact that Standing Orders were suspended to enable the two of us to have 30 minutes each for our contributions to a very serious discussion of the subject, the honourable member for Oxley (Mr Hayden) spoke for a few minutes after the honourable member for Hawker concluded. Before the honourable member for Oxley was interrupted he referred to the people of Gladstone and to the Port Curtis by-election in Queensland. I do not think that people in Queensland or anywhere else in Australia would appreciate -

Mr Clyde Cameron:
HINDMARSH, SOUTH AUSTRALIA · ALP

- Mr Deputy Speaker, I raise a point of order. I cannot hear what the honourable gentleman is saying. He is one of the members who are worth listening to. I cannot hear a word.

Mr DEPUTY SPEAKER (Mr Drummond)Order! There is too much audible conversation.

Mr MACPHEE:

– I am indebted to the honourable member for Hindmarsh. The people of Australia are interested in this subject of natural disaster insurance. They do not want to see it become a cheap political plaything. It was not worthy of the contribution by the honourable member for Hawker, who led for the Opposition, to convert the discussion into a cheap political plaything. I believe that he spoiled his speech by his closing remarks. He had referred to a bipartisan approach and to the need for a bipartisan approach. After that he introduced a red herring by referring to the Insurance Act. It was sought by the insurance industry and willingly negotiated by the McMahon Government. That Government lost office before it was able to have that Act passed. The initiative of the McMahon Government was carried on by the Whitlam Government. That has nothing to do with the question of natural disaster insurance. It has a great deal to do with the solvency of insurance companies. That is true. The honourable member for Hawker nods in agreement with the point I am making. I think it is unfair to overlook the desires of the industry in this respect.

The only serious criticism I want to make of the speech of the honourable member for Hawker is first of all to remind the House and the Australian people that- it may not have been the fault of the honourable member for Hawker- the Whitlam Government made great play of its contribution to the reconstruction of Darwin, but the reconstruction of Darwin in terms of the Government’s responsibility has not proceeded. What has been done has been done substantially by the private insurance companies- the ones which the Australian Labor Party always seemed to be attacking. These insurance companies have provided four-fifths of the money paid by way of insurance and compensation to the residents of Darwin. The second point to which I refer is the question of reinsurance. Because of the noise in the chamber I was not able to hear all that the honourable member for Hawker said, but underlying his comments there seemed to be a misapprehension about the role of reinsurance and some condemnation of the Australian insurance companies on the basis that most of the reinsurance was done overseas and therefore most of the money paid in respect of natural disasters came from overseas.

Mr Jacobi:

– I did not say that.

Mr MACPHEE:

– I am sorry. The honourable member says that he did not say that. Other persons in the Opposition have alleged from time to time that Australian companies should be able to . provide the money. Indeed, an underlying thought in the proposal for an Australian government insurance corporation seemed to be that we could provide all our own reinsurance. In point of fact even in the big North American market that is not the case. If it cannot provide all the money to insure against the risks certainly a small market like Australia cannot do so.

The motion calls as a matter of general principle for the introduction of a natural disaster insurance scheme. As the honourable member for Hawker acknowledged, the Government is firmly committed to the introduction of a natural disaster insurance scheme and it will do so as soon as it is practicable. I emphasise that the Government has decided to introduce such a scheme. On 4 March the Treasurer (Mr Lynch) announced that the Government had decided to introduce a scheme and that it had established a working party to work out the details of such a scheme. That working party is obliged to report back to the Treasurer with a detailed scheme within 4 months, which would make it late June or early July. In summarising the development leading up to this decision by the Government, I am in substantial agreement with the honourable member for Hawker. In fact the need for improvements in the arrangements for protecting the community against losses to property arising from natural disasters was highlighted in January 1974 by the floods in the Brisbane River valley. Further emphasis was placed upon this need when we had the disaster of Cyclone Tracy in December 1974. Both disasters were of massive proportions. They both involved claims on the private insurance industry for amounts totalling, in the case of Brisbane, in excess of $88m and, in the case of Darwin, in excess of $2 1 7m. In Darwin the claims involved $ 1 4 1 m on 6500 private dwellings. The Darwin disaster is reputed to be the greatest insurance loss of all time in Australia. In fact a greater proportion of property insured was damaged or destroyed than in any other event in Australian insurance history. That is a serious state of affairs and it has registered to all Australians the importance of a scheme consistent with the principle we are now debating.

One of the tragic aftermaths of the Brisbane floods was the realisation that a very low percentageindeed, as low as 10 per cent- of private dwellings in Brisbane was covered by flood insurance. It was found that many people were unaware of the fact that their ordinary fire and household policies contained storm and tempest cover but did not extend to flood cover. They were also unaware that flood insurance could be obtained from many insurers for the payment of an extra premium. After the Brisbane floods, for obvious reasons flood insurance became more difficult to obtain because of the threat of insolvency which it placed on insurance companies. Those which still gave it had to increase their premiums greatly. Following the Brisbane floods the Labor Government accepted the offer by the general insurance industry to examine ways of extending natural disaster insurance. This examination by officers of the departments proceeded when Labor was in power but, as we know, the contribution of the insurance industry was not acknowledged and understood.

Another piece of legislation was introduced called the Australian Government Insurance Corporation Bill which was purporting to cure the problem of natural disaster insurance. It used the term ‘national interest’ but it never used the term ‘natural disaster’. Under the guise of those clauses, it endeavoured to give the Government entry into all forms of general insurance. When the industry approached the Whitlam Government it was concerned that the general ignorance by the insuring public of the extent of cover given by existing housing policies should be corrected. It was concerned that these did not normally include cover for floods and that there would be increased premiums as a result, falling very severely on those in flood prone areas. Let me say by way of slight digression that one of the things the Labor Government said in making a plaything of this natural disaster cover was that the only people who were properly covered were those in defence forces homes or homes which were subject to war service loans. That is because no such loan would be granted to persons who were building in flood prone areas. But ordinary members of the public have been inclined to build in flood prone areas.

The industry went to the Government because it was concerned about the deficiencies in this respect. It had been concerned also about the uninformed and very extensive criticism being made of the industry. The industry was not merely concerned with its reputation; it was also concerned with its survival. The honourable member for Hawker has acknowledged the difficulties which arise concerning the solvency of insurance companies. That is bound up with the operation of the Insurance Act. The insurance industry was and remains deeply concerned that further natural disasters of the magnitude of Cyclone Tracy could endanger the solvency of individual companies and of the industry as a whole. I am in agreement with the honourable member for Hawker and the honourable member for Oxley who said that Australia could well be prone to further natural disasters. One hopes that they would not be of that magnitude. Nevertheless we have to be prepared. That is the reason for the Government treating this question of natural disaster insurance as being of top priority.

One of the important facts in the matter of solvency is that Australian owned companies are hit more savagely because they simply cannot spread their risks on a world wide basis the way some of the larger companies do. But it would be wrong to think that the larger ones are in a secure position. They are only relatively better off. As matters now stand there is a very great possibility that insurance companies, because of concern for their solvency, may not be able to continue to write certain classes of insurance. Amongst those that they could not continue to write would be for catastrophe cover for structures in natural disaster prone areas. In addition, since Cyclone Tracy, catastrophe reinsurance cover, which is obtainable mainly overseas, has become very much harder to purchase and, when obtainable, it is at prices as much as 1000 per cent higher than those charged 3 years ago. In point of fact what was charged 3 years ago- my friend the honourable member for Hawker agrees with this- was unrealistic.

In reports to the Labor Government by the Insurance Conference Committee, a very widely representative group of insurance companies, proposals were made for the introduction of a natural disaster insurance scheme in Australia to compensate for the loss of or damage to private property by flood, earthquake and tropical cyclones. These recommendations stemmed from the industry’s belief that it was capable of providing suitable insurance cover for property losses arising from other types of natural disaster. The industry believes that the natural disaster fund could cope with those 3 items I have mentioned and that the industry itself could cope with the other forms of natural disaster. The Labor Government ordered the Treasury to examine these proposals. A detailed examination of these reports by officials revealed a large number of complex issues involving a considerable amount of research and discussion both with industry representatives and within government. The honourable member for Hawker has shown a keen awareness of these issues and certainly recognises the difficulties.

This examination by the officials also extended to a number of alternative approaches to that put forward by the insurance industry itself. The honourable member for Hawker has canvassed some of these alternative options. The question of schemes operating in other countries has been examined and this is certainly one which has occupied the attention of the officials. It would be premature and imprudent of me today to canvass in detail some of the pitfalls which might arise from some of the proposals made by the honourable member for Hawker. But he can rest assured that his views will be taken into consideration by the working party which is due to report to the Treasurer in late June or early July.

It is necessary to examine in detail the various natural disaster schemes which are operating overseas, particularly in the United States of America and Switzerland. The honourable member for Hawker referred to crop insurance. Of course this is one of the most vexed questions of all. It is very difficult. As I have said, it would be imprudent of me to comment on what might eventuate from that but the question is fraught with enormous difficulties. It is so easy for certain people in this House to say glibly that something should be done; it is another thing to be able to devise a scheme which is practical and efficient and is a sensible use of our scarcest resource, which is capital.

Mr Jacobi:

– I doubt very much whether it is that difficult.

Mr MACPHEE:

– I will not comment on that. I just highlight it by saying what a difficult matter it is. There are certain people in the rural industries who certainly underrate the difficulties involved. While these overseas schemes are of considerable assistance in identifying the problems of any scheme which may be introduced in Australia, it is necessary that we remember in this House that we have to devise an Australian scheme which is designed for the types of natural disasters which we are likely to have in Australia. The object of tailoring overseas experience to Australian conditions in our own natural disaster insurance scheme is of paramount importance to this Government. This is the reason we have established the working party to which I have referred. The present Government recognised the urgent need for improved natural disaster insurance arrangements. This was a consideration behind the decision announced by the Treasurer on 4 March in response to a question by the honourable member for Hawker. The decision had in fact been taken by the Government before that. The Government has therefore agreed in principle to the introduction of natural disaster insurance in Australia and it has approved that the working party bring in proposals as soon as possible.

The Government considers that any natural disaster insurance scheme must be placed on a stable and viable footing. At the time of the announcement of the Government’s decision it was evident that a great deal of analysis and consultation remained to be carried out before a viable and workable natural disaster insurance scheme could be brought into operation. The Government is indebted to the co-operation of the insurance industry in this regard. I and others have had discussions with representatives of the industry and we are certainly hopeful of getting a practical scheme at the end of these consultations. But this is the reason the task of developing a scheme was given to a small working party of very senior Commonwealth officials who represent the departments which have a specific interest in the development of a scheme. The working party is now actively engaged in the preparation of research and analysis of the various options available. Its discussions have included representatives of the insurance industry who have themselves modified and improved the original submissions which they made to the Whitlam Government prior to cyclone Tracy.

In addition, it is important to recognise that the States have a role in this. The Federal Government is now engaged in discussions with the States. The States have always had a responsibility for alleviating the stress and the hardship which arises from natural disasters. The Premiers have all been invited to comment on any matters of relevance to the formulation of a scheme. I think it is worth stressing that in the past natural disasters have been dealt with by Federal and State governments in a rather ad hoc way and it is now desirable to formulate a systematic federalist approach to this serious problem. I hope that in doing that, as we now have a spirit of silence in the House, we will indeed have a bipartisan approach and we will not have these serious matters of human anguish made a political plaything again.

A significant lesson emerging from studies made to date by the working party is that there are many pitfalls which must be avoided in developing a successful natural disaster insurance scheme. While the Government is anxious to see a scheme operating as soon as possible, it is equally anxious to ensure that the scheme is placed on a sound footing from the outset. We have had enough gimmickry, enough ideas of plans which have been established which in fact could not deliver the goods. So from the outset we want a sound, workable, efficient scheme which will not create false expectations but which will take account of the likely calamities arising from future natural disasters which may strike our country. At the same time, the Government believes that the scheme should make full use of existing and potential insurance services, facilitate implementation of policies for mitigation of risks arising from natural disasters and encourage people to protect their own interests as far as possible.

For these reasons it would be irresponsible, if not nigh impossible, for the Government to introduce a natural disaster scheme forthwith. That is what the motion now before us calls for. A great deal of preparatory work must be done before any successful and viable scheme can be brought in. Experience overseas has shown that precipitate action by government in bringing in similar schemes without adequate preparation has resulted in greatly wasted expenditure by government without adequate solution to the problem. For this reason great caution must be exercised in the formulation of a natural disaster insurance scheme. Premature action by the Government to introduce a scheme before it is adequately analysed could produce a scheme insufficient for the requirements placed upon it. An inadequate scheme would not alleviate the hardships caused by natural disasters but would squander taxpayers’ money, and this Government is determined not to do that. Enough of that has occurred in Australia in the last 3 years. We do not wish to be open to criticism for wasting taxpayers’ money; we are prepared to be open to any criticism for waiting a few more months and considering a practical and viable scheme.

The honourable member for Hawker, who is a reasonable man, has shown today that he knows very well the dilemma now facing the Government. He is right to remind us and the Australian people of the need for such a scheme. But it would be unreal for the House to pass a motion calling for a scheme forthwith. In those circumstances I shall move an amendment to the motion seeking to delete the word ‘forthwith’ from the motion as proposed by the honourable member for Hawker. If that amendment is accepted the motion as passed will represent a unanimous view of this House about the need for a responsible natural disaster scheme as soon as practicable. On that basis, I move:

Mr DEPUTY SPEAKER (Mr Drummond:

Is the amendment seconded?

Mr Howard:

– Yes, Mr Deputy Speaker, I second the amendment.

Mr E G Whitlam:
Leader of the Opposition · WERRIWA, NEW SOUTH WALES · ALP

-The Opposition will vote against this amendment because this is a matter upon which investigations have been made since 1967.

Motion (by Mr Howard) proposed:

That the question be now put.

The House divided. (Mr Deputy Speaker- Mr P. H. Drummond)

AYES: 76

NOES: 28

Majority……. 48

AYES

NOES

Question so resolved in the affirmative.

Mr DEPUTY SPEAKER:

-The original question was ‘That the motion be agreed to’, to which motion the honourable member for Balaclava has moved, as an amendment, ‘Omit “forthwith”, substitute “as soon as practicable” ‘. The immediate question is ‘That the word proposed to be omitted stand part of the question’.

Question resolved in the negative.

Mr DEPUTY SPEAKER:

-The question now is ‘That the words proposed to be inserted be so inserted’.

Question resolved in the affirmative.

Amendment agreed to.

Mr DEPUTY SPEAKER:

-The question now is ‘That the motion, as amended, be agreed to’.

Mr SCHOLES:
Corio

– I wish to speak in support of the motion. The motion, as amended, has one minor difference from the original motion. We members of the Opposition are not completely happy about that difference, which is that the motion now says not ‘ forthwith ‘ but ‘as soon as practicable’. Disaster insurance is something with which this Parliament and not only the present Government but also past governments she id have dealt a long time ago.

Motion (by Mr Howard) put:

That the honourable member for Corio be not further heard.

The House divided. (Mr Deputy Speaker- Mr P. E. Lucock)

AYES: 74

NOES: 28

Majority…… 46

AYES

NOES

Question so resolved in the affirmative.

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

-The time allocated for precedence to General Business has expired.

Mr HOWARD:
BennelongMinister for Business and Consumer Affairs · LP

– I seek leave to move a motion to extend the time for the consideration of General Business.

Mr DEPUTY SPEAKER:

-Is leave granted?

Mr Scholes:

– For how long?

Mr HOWARD:

-I repeat: I seek leave to move a motion to extend the time for the consideration of General Business.

Mr Scholes:

– No. If you will not tell us for how long, there will be no leave.

Mr DEPUTY SPEAKER:

– Leave is not granted.

Suspension of Standing Orders

Motion ( by Mr Howard) proposed:

That so much of the Standing Orders be suspended as would prevent the consideration of general business continuing forthwith.

Mr SCHOLES:
Corio

-Firstly, the motion to extend General Business -

Motion (by Mr Bourchier) put:

That the question be now put.

The House divided. (Mr Deputy Speaker- Mr P. E. Lucock)

AYES: 73

NOES: 27

Majority…… 46

AYES

NOES

Question so resolved in the affirmative.

Sitting suspended from 12.59 to 2.15 p.m.

Mr HOWARD:
Minister for Business and Consumer Affairs · Bennelong · LP

– I seek leave of the House to amend the motion now before the House by inserting after the words ‘General Business ‘ the words ‘ Notice No. 1 ‘.

Mr SPEAKER:

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

Motion, as amended, agreed to.

page 2013

REPORT OF COMMITTEE

Mr SPEAKER:

-Consideration of General Business is now concluded. I call on the presentation of a report from the Standing Committee on Environment and Conservation.

Mr Howard:

- Mr Speaker, I seek the leave of the House to move on to Government Business.

Mr SPEAKER:

– You are seeking leave for Government Business to have priority over the presentation of the report, is that so?

Mr Howard:

– Yes.

Mr SPEAKER:

– I can call on the Clerk to call on Government Business. I would not like to think that the honourable member for Petrie (Mr Hodges) will not be able to bring up the report. Does the Minister indicate that the honourable member will have the opportunity to do so later?

Mr Howard:

– I do.

page 2013

INCOME TAX ASSESSMENT AMENDMENT BILL 1976

Bill presented by Mr Lynch, and read a first time.

Second Reading

Mr LYNCH:
Treasurer · Flinders · LP

– I move:

This Bill will give effect to a number of important taxation proposals that have been announced by the Government. Provisions relating to the new investment allowance are the outstanding feature of the Bill, just as the allowance itself is an outstanding feature of the Government’s program for getting the economy on the move again. I have adverted, on previous occasions, to the serious downturn in investment which took place under the policies of the former Government.

Let me simply remind the House that, from 1972-73 to 1974-75 the share of private nondwelling investment in total expenditure on gross domestic product was 10.7 per cent, the lowest recorded share for at least 20 years. The new investment allowance is being introduced as a decisive and far-reaching incentive to industry to invest and, at the same time, to create jobs; in other words, to repair the damage which has occurred during the past 3 years. On the other side of the ledger, by reducing Government expenditures and lightening the burden of personal taxation we shall be putting more money back into the private citizen’s pocket to spend as he or she wishes, so that investment and private consumption can move forward together.

In my statement to the House on 4 March I emphasised the importance which the Government attaches to an early upturn to the level of private capital investment. I also stressed the nexus which exists between high rates of inflation, on the one hand, and low levels of investment of the other. The strong action taken by the Government to curb inflation will, of itself, significantly contribute to a recovery in investment spending, but it is clear that, in the absence of taxation incentives, any such recovery in investment would be a drawn out process. This, in turn, would mean that any recovery in general activity would result in the relatively early appearance of supply shortages and in a consequent return of demand inflation.

Whatever is said by our opponents in this House it is the Government’s objective to bring forward a recovery in investment as quickly as possible. It is precisely for this reason that the tax incentives contained in this Bill are unprecedented in their coverage and extent.

But the Government is also concerned to bring about a greater degree of consumer spending in order to lift company cash flows and, consequently, business capacity to finance investment. The reining in of inflation will lift consumer confidence and unlock much of the build-up in precautionary savings which has occurred in recent years. There are now signs that both business and consumer confidence is strengthening. The evidence is that investment, particularly in manufacturing industry, has begun to move ahead and demand, as reflected in retail sales and motor vehicle registrations, is turning up.

There are three other general comments I want to make about the new investment allowance. First, it will be available for a period that is both lengthy and certain- up to June 1983, initially at 40 per cent and subsequently at 20 per cent. Secondly, unlike the earlier investment allowances it will apply over a wide range of industry and will not be confined just to manufacturing and primary production. Thirdly, again unlike the old allowances, the new allowance will be available for plant acquired under leasing arrangements as well as for plant that is bought outright or under a hire purchase agreement. It has been the Government’s wish and expectation all along- with the position of smaller businesses particularly in mind- that the benefit of the allowance provided in respect of leased plant be passed by lessors through to the lessees who actually operate the plant in productive use. The special provisions contained in the Bill to apply to leased plant have been drawn up with this end in mind.

As I have announced previously, the new allowance will apply to capital expenditure on acquiring new, but not second-hand, plant or equipment that is orderd on or after 1 January 1976. Tax deductions by way of double or normal depreciation on eligible plant will, of course, be additional to the investment allowance. Plant constructed on a taxpayer’s premises will attract the allowance if construction by the taxpayer commenced on or after 1 January 1976 or if a contract for construction of the plant by an independent contractor was entered into on or after that date. During the first phase of the allowance- from 1 January 1976 to 30 June 1978- the deduction will be 40 per cent of eligible capital expenditure. A 20 per cent deduction will apply for the second phase running from 1 July 1978 until 30 June 1983. A 12-month period of grace for installation of plant ordered during either phase will be available so that unforeseen delays will not necessarily deprive taxpayers of an expected benefit.

To be eligible for the allowance, plant and equipment must qualify for depreciation for tax purposes and be used in Australia solely for the purpose of producing assessable income. So that the allowance will be directed towards investment that , will have the greatest stimulatory effect on the economy, individual items of plant costing less than $500 will not be eligible for it. The allowance will apply in full to the entire cost of individual items of eligible plant that cost $976 or more and will be shaded-in for items that cost between $500 and $976. The scope of the allowance has been adequately covered in earlier statements I have made and is set out in detail in an explanatory memorandum that is being circulated for the information of honourable members. I do not, therefore, intend to go into further detail about it in this introductory speech.

The introduction of the new investment allowance makes it necessary to withdraw the double depreciation scheme which the previous Government brought in. The Bill accordingly will limit double depreciation to eligible plant installed not later than 30 June 1976. Plant or equipment that qualifies under the double depreciation program and that is first used, or installed ready for use, by 30 June 1976 will continue to be depreciable at double rates until its cost is fully written-off for income tax purposes.

It is widely accepted that the investment allowance is a great improvement on the scheme which is being terminated. The double depreciation scheme is too drawn out in its effects. Its full benefits take time to work out and its impact on business cash flows lacks the immediacy and fullness that the investment allowance will confer. Beyond the obvious deficiencies of doubled depreciation, I should point out that the scheme was never a permanent feature of the former Government’s policy. It was never brought before this House as anything other than a stop-gap temporary measure. In consequence, it served largely to compound the uncertainties created by our predecessors’ stop-go economic policies. Right up to the change of government no assurance was provided that doubled depreciation would extend beyond the period of the present financial year. By contrast, the investment incentives provided for by this Bill are long term and will act as a firm basis for investment planning by the business community.

Another matter dealt with in the Bill also is designed to assist business in the present difficult financial circumstances. This is the decision the Government has made to defer, until the date for payment of final assessments, the instalment of company tax that would have been due for payment in February 1976. The Bill makes provision to this effect and it provides also that instalments of company tax are not to be payable during the 1976-77 financial year in respect of 1975-76 income. Accordingly, the whole of the tax payable by a company on its 1975-76 income will become due in one amount towards the end of the 1976-77 financial year.

I come now to amendments proposed in respect of the conditions which must be satisfied for interest payable on convertible notes to be an allowable tax deduction. Convertible notes can often be a useful instrument to an enterprise that wishes to raise funds for expansion and development, particularly an enterprise that still has to establish its capacity to pay an attractive rate of dividends or one that is not well known to potential equity investors. But it is sometimes forgotten that a convertible note issue involves not only the issuing enterprise and the noteholders but also, if the interest on the notes is deductible, the general revenue. The interests of the general revenue, in particular, can often be overlooked. This was the case in the period up to 1960 when notes were issued that were only formally distinguishable from shares. It was customary then for noteholders to have no real choice about converting their notes into shares. Automatic conversion was virtually the rule and this meant that the revenue bore the cost of deductions for interest payments that were, in all but name, dividends on deferred share issues

The Government of the day reacted to this situation with measures which virtually closed off the issue of convertible notes. With the passage of time, however, conditions were developed, in consultation with financiers, that were seen to strike a reasonable balance amongst the various interests involved. Since 1970, interest on convertible notes has been allowable- provided that these conditions are satisfied. With experience since 1970 as a guide, the Government believes that further relaxations can appropriately be made. We will retain safeguards against a return to pre- 1960 tax avoidance practices but our changes will be of advantage to enterprises that wish to expand or develop and prefer the flexibility of convertible notes to either pure fixed interest borrowings or immediate share issues.

There are four changes proposed, each of which will apply to convertible note issues connected with loans made on or after 1 January 1976. A minimum borrowing period- now of 1 years- will no longer be required. Companies will be allowed much greater freedom in setting the times when noteholders may exercise an option to convert their loan into share capital. Companies will not be as restricted as they have been in the past in varying the terms of conversion as the period of the loan progresses. And, finally, it will be permissible for the rate of interest on locally raised convertible loans to vary in line with interest rates prevailing from time to time on relevant markets. This is already the case with loans raised abroad.

The Bill also gives effect to the Government’s recently announced intention to exclude certificates of deposit and other securities issued after 12 April 1976 by Government-owned banks from the range of securities that may be taken into account in ascertaining whether a superannuation fund or life assurance company has satisfied the ‘30/20’ investment rule in relation to its assets. The income tax benefits available to a superannuation fund or a life assurance company which maintains the ‘30/20’ ratio in relation to its assets are discussed in detail in the explanatory memorandum I have circulated. The purpose of the amendment is to ensure continued support from the life offices and the superannuation funds for loan raisings by Commonwealth, State and semi-government authorities and to remove the competitive advantage that the government-owned banks would otherwise have over other banks in seeking funds for commercial purposes. I propose shortly to introduce a separate Bill to make a parallel amendment to the superannuation legislation that was recently considered by this House. This amendment will make similar changes in the provisions governing the investment of the superannuation fund for Commonwealth employees.

The Bill also provides for some major changes to the scheme, introduced by the previous Government, under which a tax deduction is allowed for home loan interest when certain tests are satisfied. The Government considers that that scheme was far from soundly based. For one thing, within the net income limits the deduction was available regardless of the proportion of a person’s income which home loan repayments represented. Thus someone who took out a loan years ago could still obtain tax relief even though home loan repayments had over time come to represent only a small fraction of the person’s income. The Government regards this as inefficient and wasteful and as not getting to the core problem which is the deposit gap. A would-be home buyer could get little comfort under the present scheme from the thought that he would be assisted with his interest payments on a home loan when he found it difficult or impossible to save enough to put down a deposit. The Government’s program of assistance to home buyers does get off on the right foot. On the one side, there is to be a new and more generous home savings grants scheme to assist in bridging the deposit gap. On the other side, consistent with our election undertakings to support the home loan interest tax deduction scheme, this scheme will be kept in being but in a way that we consider looks better to the realities of the situation.

The realities are that it is the move into the first purchased home that is the key step, and that the relative burden of servicing a loan is normally heaviest during the first few years of the loan. Once in their first purchased home, taxpayers can normally be expected to be assisted in any move to second and subsequent homes- whether the move is made for employment or private reasons- through gains on the sale of the first home. Again, as incomes rise the burden of servicing a loan can normally be expected to show a comparative reduction- the hump passed, the need for assistance out of general revenue diminishes as a direct consequence. That is why, under the amendments proposed, interest deductions will be allowable after 30 June 1976 only in respect of first homes and during the first S years of the loan to acquire that home. Other aspects of the scheme are not being changed.

The last of the major proposals in the Bill relates to the valuation of trading stocks of winemakers. When the special stock valuation provisions applicable to wine and brandy producers were repealed in 1973, the producers were faced with difficulties in paying off the tax of earlier years that had been deferred through the operation of the provisions. The previous Government allowed a period of 5 years for paying off the deferred tax, but this is now seen to be insufficient time. We gave careful thought to the producers’ position in the months preceding the election and said that, on being returned to office, we would review the taxation arrangements that apply to wine and brandy stocks. The provisions I shall shortly mention have been decided on after frequent and close consultation with industry representatives.

The tax deferred in the past is not to be forgiven. We had made no commitment on that score and forgiveness would not have been the appropriate step. But we propose that producers will have a more extended period to pay off that deferred taxation. This should ease their liquidity problems considerably in the coming months. The industry will also benefit when stock adjustments along lines recommended by the Mathews Committee are determined for the Budget. At that time, the basis of stock valuation to apply to the wine and brandy industry for future income tax purposes will be considered along with the basis to apply to other industries.

In introducing this legislation I take the opportunity of laying to rest a belief which has been evident in some public discussion that the general stock valuation provisions of the law that now apply to the wine and brandy industry, along with other industries, in some way lead to tax having to be paid in respect of unsold stock still maturing in producers’ cellars. This is just not the case. If stock is valued at cost- and most producers adopt that basis- no tax is payable on the stock until it is sold because no profit arises on it for tax purposes until it is sold.

Other provisions of the Bill deal with some formal matters associated with changes in the names of departments and the like and I do not think I need to discuss these changes now. The Bill is large and not uncomplicated but so are the subjects and situations with which it deals. I have circulated an explanatory memorandum for the information of members of the House and it now only remains for me to commend this Bill to the House.

Debate (on motion by Mr Hurford) adjourned.

page 2016

SUPERANNUATION AMENDMENT BILL (No. 2) 1976

Bill presented by Mr Lynch, and read a first time.

Second Reading

Mr LYNCH:
Treasurer · Flinders · LP

– I move:

That the Bill be now read a second time.

As foreshadowed in my second reading speech on the Income Tax Assessment Amendment Bill 1976, when referring to changes in the range of securities for the purposes of the 30/20 investment rule, I now introduce the Superannuation Amendment Bill (No. 2) 1976. The Bill makes consequential changes to the definitions of ‘Commonwealth securities’ and ‘public securities ‘ in the Superannuation Act 1976.1 commend the Bill to the House.

Debate (on motion by Mr Hurford) adjourned.

page 2016

INCOME TAX (INTERNATIONAL AGREEMENTS) AMENDMENT BILL 1976

Bill presented by Mr Lynch, and read a first time.

Second Reading

Mr LYNCH:
Treasurer · Flinders · LP

– I move:

That the Bill be now read a second time.

This Bill will provide legislative authority for the entry into force of comprehensive double taxation agreements with the Netherlands and France. The agreements were signed recently and deal with all substantial forms of income flowing between Australia and the other 2 countries. Neither of the agreements can enter into force until all necessary constitutional processes are completed both by Australia and the other country. For Australia, this Bill will, when assented to, complete the processes required of us.

Double taxation agreements have 2 principal functions: The elimination of international double taxation and the prevention of fiscal evasion. The former involves the apportionment by one means or another of the relevant taxation revenue between the contracting countries. There are various means of achieving this apportionment. Some income is taxed only in the country of residence; other income is taxed only in the country where it has its source. The country of source may agree to limit its tax on some items of income and, where both countries do tax particular income, the home country of the taxpayer allows a credit against its own tax for the amount that is paid to the other country. Such revenue sacrifices as one country or the other makes are to be seen in the light of the favourable impact that these agreements have on trade and investment flows, and on the improvement of more general relationships between the countries concerned. And, it is often overlooked that, where a country in which income originates does reduce its rate of tax on an item of income, the home country will also be levying tax on the income.

Each of the new agreements is along the lines of Australia’s modern agreements, that is, those negotiated or renegotiated since 1967. The previous Government had agreed to the substance of the new agreements, and I think that only a brief description of their principal features is required from me in this introductory speech. Under both agreements, Australia is to reduce its withholding tax on dividends flowing to the other country, from 30 per cent to 1 5 per cent of the amount of the dividends. In converse circumstances, the Netherlands and France are to reduce their rates of dividend withholding taxcurrently 25 per cent in both countries- to 15 per cent. I mention that profits out of which dividends are distributed by Australian companies to foreign shareholders bear the company tax rate of 42.5 per cent, so that, with withholding tax at the rate of 1 5 per cent, the total Australian tax on each $100 of distributed profit is $51.12. That is not an unreasonable contribution to Australian revenue by shareholders living in the other countries.

Both agreements specify a limit of 10 per cent on each country’s tax on interest and royalties flowing to the other. For Australia, this will mean no reduction in our interest withholding tax which is charged at a rate of 10 per cent by our taxation law. For royalties flowing to the

Netherlands and France, our tax will be limited to 10 per cent of gross payments, instead of tax at general rates on net royalties. France will reduce its withholding taxes on interest and royalties, normally 25 per cent and approximately 1 9 per cent respectively, to 10 per cent. The Netherlands does not generally tax interest and royalties paid to residents of other countries but the limit of 10 per cent would apply if it taxed such income in the future.

Both agreements contain measures for the formal relief of double taxation of income that would otherwise be taxed by both countries. In such cases the country of residence of the taxpayer is obliged to provide the necessary relief. Generally, income which may be taxed in full in the country of source will be exempt from tax by the country of residence, while in the case of income that is taxed at reduced rates in the country of source- dividends, interest and royaltiesthe country of residence will tax the income and allow credit for the tax of the country of source. I am sure that is very clear to honourable gentlemen on both sides of the House. Mr Deputy Speaker, I certainly know you are following this matter with very keen and personal interest.

A unique feature of the French agreement, which relates to the French system of taxing company profits and dividends, is worthy of note. Under this provision, the French Government will in specified circumstances make a payment to Australian shareholders in French companies of an amount equal to a special tax credit normally payable only to residents of France. These payments will be treated in Australia as dividend income and included in the assessable income of the recipient accordingly. Apart from the provisions I have mentioned, the 2 agreements contain the usual provisions common to double taxation agreements relating to the taxation of business profits, visiting businessmen and employees, public entertainers, students and pensioners, etc. A memorandum containing much more detailed explanations of technical aspects of the Bill and of the agreements is being made available to honourable members. I commend the Bill to the House.

Mr DEPUTY SPEAKER (Mr Lucock:

-I would like to comment on the remarks of the Treasurer. Although I have sat in this Chair over a period of more than 20 years, I never cease to be amazed at some of the phraseology that is capable of being used in Bills and in speeches.

Mr LYNCH:

– I accept your commendation, Sir.

Debate (on motion by Mr Hurford) adjourned.

page 2018

ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT (FINANCIAL SUPPORT FUND) BILL 1976

Bill presented by Mr Lynch, and read a first time.

Second Reading

Mr LYNCH:
Treasurer · Flinders · LP

-I move:

This Bill authorises the ratification by Australia of the agreement establishing a financial support fund of the Organisation for Economic Cooperation and Development. That agreement was signed by OECD member countries, including Australia, in Paris on 9 April 1975. The Bill also contains provisions to enable Australia to fulfil its obligations under the agreement. The concept of the financial support fund had its origins in the period immediately following intervention by the Organisation of Petroleum Exporting Countries in the world oil market in 1973. This intervention had very serious consequences for non-OPEC countries. It transferred real income from these countries to oil producers. In the process, inflation was aggravated, recession deepened and balance of payments positions of non-OPEC countries deteriorated. The initial balance of payments effects were particularly striking. The OECD countries, which recorded a collective surplus on the current account of their balance of payments of .US$2.5 billion in 1973, experienced in 1974 a current account deficit of US$33.25 billion. The current account surplus of OPEC countries rose by more than US$60 billion between these years.

In order to assist countries to deal with this new economic situation, the United States Administration and the Secretary-General of the OECD independently made similar proposals in late 1974 for the establishment among OECD countries of a finanical ‘safety net’ in the form of the fund. It was felt that, with substantially higher oil prices, the large increases in current account deficits of the developed countries would not necessarily be matched by the investment of OPEC financial surpluses because of the concentration of such investments in relatively few countries. The fund was designed to assist in ‘recycling’ financial flows between the developed countries. Initial discussions on the establishment of the fund took place in the ‘group often’ major industrial nations. In January 1975 the discussions were widened to all OECD member countries and Australia participated actively in the negotiations after that date. Early fears in some quarters that the fund was confrontational and would aggravate relations wth oil producers, proved to be unfounded and a major dialogue was established between developed, developing and oil producing countries in December 1975. The fund has come to be seen as a sensible instrument of financial co-operation among the developed countries during the process of adjustment of those countries’ economies necessitated by the increase in oil prices.

Although the combined external deficit of the OECD countries fell markedly in 1975, the basic rationale of the fund remains valid. Most of the reduction in deficits was attributable to the effects of recession on demand including demands for imported oil. A return to more normal economic circumstances will increase the scale of the external financing problems with which the fund was created to deal. In any event, some countries continue to run substantial deficits notwithstanding the OECD-wide deficit. In essence the financial support is intended to encourage and assist its members to avoid unilateral trade restricting measures and to follow appropriate domestic and international economic policies. The fund will serve, for a limited period, to supplement on a last resort basis other sources of credit to which members encountering serious economic difficulties have had recourse.

Let me now describe the basic features of the financial support fund. Membership is open to all OECD countries. Each OECD country has a quota which determines its maximum financial liability and is the basis for determining its borrowing rights. All OECD countries have signed the agreement and, assuming all subsequently ratify it, the total size of the fund will be SDR 20 billion, equivalent to about $A18.5 billion. Australia’s quota is SDR 300 million- about $A275 million-or 1.5 per cent of the total. The agreement will enter into force when ratified either by countries having 90 per cent of total quotas or by at least 15 countries having 60 per cent of total quotas. Signatories have until 31 May 1976 to ratify the agreement on founder member terms. The agreement also provides that signatory countries may ratify after that date in accordance with such terms and conditions as may be established by the governing committee of the fund.

Members may be eligible for loans, with a maximum repayment period of 7 years, if they are encountering serious external financial difficulties and have made fullest appropriate use of reserves and existing multilateral credit facilities. Loans will be conditional on the borrower’s following economic policies needed to redress its external financial situation and being willing to subscribe to the general objectives of the agreement. In particular, borrowers will be required to follow appropriate domestic and international economic policies, including adequate balance of payments policies and co-operative policies to promote increased production and conservation of energy. The fund may grant loans for a period of 2 years after the agreement enters into force. A decision to grant a loan up to an amount equivalent to a borrowing member’s quota will require a two-thirds majority of the governing committee, on which all members will be represented. A member seeking to borrow beyond quota would require higher majorities and, eventually, unanimity. Two methods may be used to finance loans. Under the first method there would be calls on each member to provide, at its option, either a direct contribution or a guarantee to enable the fund to borrow its share of funds on its behalf. Under the second method the fund itself would borrow on the collective guarantee of all members. Contributions for each member will be proportional to their quotas.

The provisions of the fund agreement are drawn up in such a way that there is virtually no circumstance in which there need be a direct budgetary impact. Should the fund borrow on the collective guarantee of all members it would in all likelihood utilise overseas markets, in which case there would be no impact on members’ budgets. Should Australia be called on to provide, at its option, either a direct contribution or a guarantee, Australia could elect to have the fund borrow on its behalf in overseas markets. In the unlikely event that funds were not available in overseas markets, Australia would have the choice of allowing the fund to borrow in the Australian capital market, or of making a direct contribution, which would require a budgetary appropriation. In this latter case- which is, as I have indicated, extremely unlikely to arise- any funds lent would be protected from exchange risk and would earn a reasonable rate of interest. Amounts borrowed by the Fund would be met, as they mature, from repayments by borrowing participants, although there would be a contingent liability for Australia in the form of a guarantee on borrowings by the Fund.

As a member of the fund, Australia would be able in appropriate circumstances to borrow from it. However the Fund is a ‘last resort’ facility and, in circumstances where Australia sought to borrow, we would need to show that we had utilised our presently substantial unused borrowing capacity elsewhere- for example in the International Monetary Fund. In accordance with normal practice, legislation would be required for any borrowing by Australia from the financial support fund.

The Government sees the main value of the Fund in terms of its capacity to help maintain healthy trading and financial relationships between the major countries. Australia, as a major trading nation, has an important interest in a smoothly operating world economy free of the economic upheavals which unfortunately have characterised the more recent past. The financial support fund will help to avoid the imposition of damaging restrictions on international trade, production and output. This can only be of benefit to Australia.

The financial support fund agreement also represents an important exercise in international economic co-operation among our major trading partners and allies. Australian participation in the Fund will be a demonstration of our support for a significant initiative to help ensure that world trade and monetary stability are not disrupted while countries are adjusting their economies to changed circumstances.

According to the latest information available, 8 countries have already ratified the Agreement and a further four are in a position to do so. The remainder of the membership hope to be able to do so by the end of May. The Government believes it is desirable for Australia to do likewise if possible. I commend the Bill to honourable members.

Debate (on motion by Mr Hurford) adjourned.

page 2019

STEVEDORING INDUSTRY (TEMPORARY PROVISIONS) AMENDMENT BILL 1976

Bill presented by Mr Street, and read a first time.

Second Reading

Mr STREET:
Minister for Employment and Industrial Relations · Corangamite · LP

– I move:

This Bill seeks to amend the Stevedoring Industry (Temporary Provisions) Act 1967-1974 in 2 ways: Firstly to extend the operation of the Act from 1 July 1976 to 31 December 1976; secondly, to enable refunds to be made to the

Fremantle Port Authority, in respect of certain employees of the Port Authority.

The Bill is a very simple one. The most important aspect of it is that it seeks to extend the operation of the legislation for a limited period. Members will be aware that this Act has been extended on a number of previous occasions and the Government finds it necessary to do so again for reasons which I will outline. The Government has given detailed consideration to the future arrangements to apply in this industry and I propose to elaborate on the attitude the Government takes to this whole question later in this speech. To give effect to what the Government proposes it will of course be necessary to extend the operation of the Act until 3 1 December 1 976.

Before proceeding to elaborate on the Government ‘s attitude to future arrangements for the industry I want to refer briefly to that aspect of the Bill dealing with waterside workers employed by the Fremantle Port Authority. The Bill seeks to facilitate an agreement reached by the Fremantle Port Authority and the Waterside Workers Federation and it is a matter which has the support of the Stevedoring Industry Council. It concerns approximately 30 members of the Waterside Workers Federation currently employed by the Fremantle Port Authority as crane drivers. These men are not registered waterside workers and their conditions of employment with the Authority provide for different long service leave and pension entitlements to entitlements for registered waterside workers under existing legislation.

In 1973 the Fremantle Port Authority and the WWF agreed in principle to an arrangement whereby crane drivers would become registered waterside workers but retain separate long service leave and pension entitlements. This arrangement is limited to waterside workers employed as crane drivers at the time of registration. Persons employed in the future as crane drivers are to be subject to the normal conditions of employment. Efforts were made in 1974 to resolve the matter by regulation. However legislative amendment is necessary to enable the long service leave and pension components of the stevedoring industry charge in respect of these men to be reimbursed to the Port Authority which makes direct provision for these matters. A Bill with the same purpose was introduced into Parliament in November 1975 but lapsed at the second reading stage when Parliament was prorogued.

The intention of the Bill- clause 4- is to permit the Australian Stevedoring Industry Authority to refund to the Fremantle Port Authority amounts equal to such parts of the stevedoring industry charge as the ASIA considers appropriate for the purpose of meeting the long service leave and pension entitlements of a waterside worker in respect of persons who, prior to their registration as waterside workers, were employed as crane drivers by the Fremantle Port Authority. I now wish to elaborate on the consideration the Government has given to the overall question of the future of the industry and what the Government believes is the proper course to take.

Legislative Involvement in the Industry

The Commonwealth’s direct statutory role in relation to the stevedoring industry actually began in 1928. It was in 1942 however that wartime conditions compelled the Government to take steps designed to end the chaotic labour situation which had developed on the waterfront during the early years of the war. This role was exercised initially by means of National Security Regulations which provided for a Stevedoring Industry Commission under the chairmanship of the Chief Judge of the Commonwealth Court of Conciliation and Arbitration. The Commission became inoperative in 1949 and was replaced by the Australian Stevedoring Industry Board. In turn, the Board was replaced by the Australian Stevedoring Industry Authority in 1956. The Authority has continued in existence since that time, although, as indicated below, its powers have undergone considerable change since 1967. Legislation which regulates this industry is as follows: The Stevedoring Industry Act 1956-1973, The Stevedoring Industry (Temporary Provisions) Act 1967-1974, The Stevedoring Industry Charge Act 1947-1975, and The Stevedoring Industry Charge Assessment Act 1 947- 1 973. The “first mentioned Act set up the Australian Stevedoring Industry Authority and has been superseded in many respects by the Stevedoring Industry (Temporary Provisions) Act introduced in 1967, and the regulations made thereunder. The latter piece of legislation was introduced when the Government adopted arrangements agreed to by representatives of employers, unions and the Government in the National Stevedoring Industry Conference set up in 1965 under the chairmanship of A. E. Woodward Q.C. The Stevedoring Industry Charge Act and Charge Assessment Act are machinery measures administered by the Taxation Commissioner and exist for the purposes of financing the administrative arrangements applying in the industry.

The Australian Stevedoring Industry Authority

The Australian Stevedoring Industry Authority was established in 1956 and replaced the Australian Stevedoring Industry Board. Since the introduction of the national conference scheme of employment in 1967, the Authority has had considerably reduced responsibilities in the industry. For the performance of its functions, the Authority is empowered to make orders having the force of law. The Authority’s expenditure is financed by the stevedoring industry charge which is levied on man hours worked by registered waterside workers and paid by employers to the Commonwealth Commissioner of Taxation. Until 1970, the powers and functions of the Authority were vested in a chairman, and two other members, one of whom was to be experienced in industrial affairs by reason of having been an employer in an industry or having been otherwise associated with management in industry; and the other experienced in industrial affairs by reason of having been associated with trade union affairs. In 1970, this Board was replaced by a single director.

The Waterside Workers Federation

The most significant union in the industry is the Waterside Workers Federation, whose members provide the bulk of the manpower for stevedoring operations. At 30 June 1975 the number of waterside workers registered, in accordance with the legislation regulating the industry, was 13 375. Taking into account other categories of employees in the industry the total number employed is in the vicinity of 20 000.

The National Conference Scheme

Until 1967 the almost exclusively casual nature of waterside employment resulted in a situation whereby there was almost a complete absence of the employer-employee relationship which existed in most other industries. Between 1914, when the first federal award covering waterside employment was made, and 1967, industrial relationships in the industry proceeded by means of continuous confrontation with the relative strengths of the parties being determined by the prevailing economic situation. In 1965 the Government set up the National Stevedoring Industry Conference under the chairmanship of Mr A. E. Woodward, Q.C., with the objective of achieving a long term improvement in conditions in the stevedoring industry. Participants were the Australian Council of Trade Unions, the Association of Employers of Waterside Labour, the Waterside Workers Federation, the Australian Stevedoring Industry Authority and the Department of Labour and National Service.

Following meetings in 1965 and 1966, the Conference reached agreement, in April 1967. The main proposals were:

Casual employment to be replaced by a system of permanent employment on a weekly hire in the major ports. The bulk of these permanent employees were to be employed directly by the individual stevedoring companies ‘operational labour’- and the remainder by a representative employer holding company, Stevedoring Employers of Australia Ltd. This labour- ‘holding company’ or ‘pool’ labour- was to be allocated on a daily basis to operational stevedores to meet labour shortages as required.

The introduction of pension and past service benefit schemes.

Arrangements for coping with anticipated redundancies.

New disciplinary procedures for weekly hire employees.

Strengthening the role of industrial relations committees for dealing with potential and actual industrial disputes.

A reduction in the functions of the Australian Stevedoring Industry Authority in permanent employment ports.

The agreement embodied in the Conference report was referred back to the parties for approval on the basis that it was a package and was eventually endorsed on that basis by all concerned including the Government. In November 1967 the Government introduced enabling legislation to permit the scheme to operate on a trial basis until 30 June 1970. The end of casual employment was regarded as a major industrial breakthrough. It was expected that permanent employment would provide an opportunity for the development of direct employer-employee relationships which would significantly improve relations within the industry.

The National Conference continued to operate until 1970. In that year it was reconstructed and given legislative recognition as the Stevedoring Industry Council. From 1967 until 1972, the Conference/Council was chaired by Mr A. E. Woodward, Q.C. Since 1972, the Council Chairman has been Mr. R. M. Northrop, Q.C, now Mr Justice Northrop. It was initially intended that the National Conference scheme should have a trial period of 2V4 years. However, practical difficulties were found with the scheme’s operation and aspects of it were revised or renegotiated. These modifications and departures delayed final agreement on permanent arrangements for the industry. Additionally, the continued impact of technological change has made the industry’s future uncertain. As a result, it became necessary to extend the life of the trial period on several occasions. The temporary legislation governing the scheme is currently due to expire on 30 June 1976. It is recalled that the National Conference began negotiations against a background of many years of intense industrial unrest and continuous confrontation. The National Conference in fact represented the first successful attempt at the national level at having the major industrial parties in the industry engage in discussions which led to achieving an essential first step in breaking with the past. This prepared the industry for the major technological developments of the late 1960s and beyond and allowed these changes to occur without the industrial dislocation which occurred in similar situations overseas.

Recent Developments

As indicated the National Conference scheme of employment envisaged that the industry would move towards a situation where normal employer-employee relationships would exist. Since the introduction of the Conference scheme arrangements, embodied as they were in legislation of a temporary nature, consideration has been given as to the form that future or more permanent arrangements should take. It will be recalled that the honourable member for Hindmarsh (Mr Clyde Cameron) when Minister for Labor gave consideration to a proposal whereby the operations of the industry would be carried out by the Government; thus in effect nationalising the industry. The Labor Government did not proceed with this approach and late in 1975 the then Minister, Senator James McClelland, requested Mr R. M. Northrop Q.C., as he then was, to report on the views of the parties to the industry ‘as to what they see as the problems associated with the existing arrangements and for the action they consider appropriate for the Government to take as to future arrangements’. Mr Justice Northrop has now reported to me and I have consulted with the principal parties to the industry on the details of their submissions.

In its consideration of this whole question the Government has been mindful that the direct Government involvement in the industry has diminished sharply since 1967 and that no part of the industry finds the existing arrangements acceptable. In the light of the views that have emerged from the Northrop inquiry there are really only 2 courses the Government can consider, that is, to further encourage the trend that has developed since 1967 or to reverse that trend by initiating greater Government involvement. It has been the Government’s concern to ensure that the industry should be as efficient as possible and to operate in such a way that the wider community interests are fully recognised. Having examined all material available concerning the future arrangements for the stevedoring industry, including the position statement prepared by Mr Justice Northrop, and having discussed this statement with major interests in the industry, the Government is now able to indicate the course of action it considers appropriate. In doing so the following observations are made:

Existing Problems in the Industry

The Government notes that in paragraph 54 of his statement Mr Justice Northrop identifies the problems arising under the existing arrangements as being:

  1. The inflexibility of the size of the labour force- the redundancy problem and the difficulty of reducing effectively the size of the workforce as well as maintaining a skilled work force not composed entirely of the more elederly workers, as well as the financial security of the waterside worker.
  2. The method of allocation of labour between operational employers and; Stevedoring Employers of Australia Ltd. resulting in the incurring of ‘locked up’ idle time.
  3. The method of funding the industry as contained in the existing legislation, particularly the basis of the charge being on man-hours rather than on tonnage handled and delays in varying the rate of the charge.
  4. The introduction of restrictive practices such as equalisation of earnings and of idle time between labour at a port.
  5. The lack of effective dispute settlement procedures and of discipline.
  6. The continued high incidence of strikes and unauthorised stoppages in the industry.

The deficiencies that those involved in the industry claim to exist are of concern to the Government because they all add to the industry’s costs and because the burden of those increased costs falls to the community.

Government’s attitude

Those involved in the industry have put before the Government 2 broad alternatives:

Restructuring of the industry involving some form of Government control and/or participation;

Progressive withdrawal of the Government from its present statutory role in the industry.

The Government has also explored other alternatives. The preponderance of those who suggested increased Government involvement in the industry support the creation of a statutory body to employ all waterside workers and possibly clerks and foremen stevedores as a pool system and to hire out these people to operational companies. The Australian Stevedoring Industry Authority put forward detailed submissions as to the powers and operation of such a body.

For a Government to take control of an industry’s workforce would be an unprecedented step. It means in effect denying to both employees and employers the right to the normal relationships that are found in other industries. It would take from the employers the right to control and direct their employees to the ends that their commercial endeavours require. At the same time it would take from the employee an entitlement to see his contribution as part of the operational concern. It would be an extraordinary step to take but one which the Government does not set aside lightly. The Government however does not believe that such a course of action would be timely or appropriate. The Government acknowledges that this industry has not been the same as other industries. The Government believes that now everything should be done to ensure that this industry moves toward a situation where the relationships in the industry are as normal as possible and that employers and employees within the industry accept the same restraints and responsibilities required of other industries. That is to say that the Government’s central concern is to ensure that the community interests are fully taken into account. There is a clear need to ensure that the interests of user groups are protected. This goes to the heart of the question of restraints on costs and hence restraints upon the levels of wages and conditions in the industry.

Matters for Consideration by Parties in the Industry

It is therefore proposed that in the ensuing months the Government will consult with those involved in the industry as to how they propose to develop a suitable framework within which solutions can be provided to major industry problems. In particular the Government believes the following are essential considerations: Continued efforts to reduce the existing size of the workforce. I consider this aspect of fundamental importance. Earlier this year I approached the Treasurer (Mr Lynch) to secure for the Authority access to funds to enable redundancy payments to be made to waterside workers to ensure that those wishing to leave the industry were free to do so. I am advised that already more than 2 SO waterside workers have cancelled their registrations under these arrangements and more are likely to do so.

Mr Donald Cameron:
GRIFFITH, QUEENSLAND · LP

– How much will the handshakes cost?

Mr STREET:
LP

– I think from memory they work out at approximately $10,000 per worker. Another essential consideration is the making of satisfactory arrangements for recruitment and redundancy of waterside workers to cope with the fluctuating requirements as to the size of the workforce. By way of explanation I would point out that the inflexibility of the size of the workforce has been a problem mitigating against the efficiency of the industry. What is required is a means of effectively dealing with the peaks and troughs of labour demand. I would see the development of arrangements whereby the base labour force at any port can be added to by workers drawn from a supplementary force as the need arises, as an essential means of overcoming the problem. I recognise that the maintenance of efficient labour forces is of particular importance in smaller ports. The position regarding regional interests associated with the smaller ports has to be protected and the needs of these areas cannot be submerged in the interests of the major ports. In this I am indicating that the Government looks with special concern at this sector of the stevedoring industry.

Other essential considerations are: Evidence of an adequate method of allocation of labour. It is expected that labour availability will be such that stevedoring operators will be able to have access to an adequate labour supply; means of securing improved industrial relations and methods for the settlement of disputes. Satisfac-^tory consultative procedures to enable effective consideration of the industry problems in these.* areas would need to be developed; arrangements should be settled to allow user interests such as the Australian Shippers Council and other relevant bodies such as the Australian Port and Marine Association to have an effective voice on industry matters as part of the consultative procedures; satisfactory funding arrangements having regard to the existing deficit and future commitments. It has been suggested in some quarters that the accumulated deficit in the ASIA accounts should be covered by the Government providing funds from Consolidated Revenue. The Government could not agree to this- rather it is the responsibility of the industry. The Government has noted suggestions made that the industry would seek some temporary assistance towards meeting this problem and this is a matter I would be prepared to examine with industry interests.

Staff of Australian Stevedoring Industry Authority

The position regarding the staff of the ASIA is of particular concern to me. When meeting with the Federated Clerks Union, the Administrative and Clerical Officers Association, and the Professional Officers Association earlier this year, they all referred to what they saw as the special position of these staff in that their future had been uncertain for some time; that if the Authority were not to continue then special arrangements should be made for the staff. As well they expected that the earliest possible consultation would take place concerning decisions as to the future of the staff.

I have already forewarned the Director of the Authority, the Australian Council of Trade Unions and the relevant unions of the course the Government intends to adopt and I have outlined the steps that will be taken as to the future of the staff. These include: Application to them of the Government program dealing with assistance to redundant employees in Commonwealth departments and agencies and including discussions with both employers and unions as to the totality of the arrangements to apply; a special section of the Department will be devoted to co-ordinating the operations of the Commonwealth Employment Service in an exercise designed to provide maximum assistance aimed at locating the staff concerned in suitable alternative employment; and raising with employers in the industry the steps that they might take to offer to staff presently employed by the Authority new employment opportunities.

The Government is mindful of the role played by the ASIA and the contribution made by the staff of the Authority. It is the Government’s view that it is now time to bring to an end its direct regulatory involvement in this industry. Rather than turning to the alternative of the Government taking on to its payroll an additional 20 000 employees and assuming a position where it imposes its will so directly upon the industry, we would prefer to see the industry operating efficiently and responsibly of its own will.

Other Aspects

I have indicated, however, that the Government will require the clearest indication from the industry in respect of the considerations I have set down. However, as the costs associated with this industry have been a source of central concern to successive governments, I have consulted with my colleague, the Minister for Business and Consumer Affairs (Mr Howard) and expressed the view that in the light of the impact costs in this industry have on all sections of the community it is proper that such costs should come under surveillance to ensure that prices set are fair both to the supplier and the consumer. There does seem to be a need for continuing monitoring of costs in this industry to identify and highlight such features as: Reasons for cost increases, profitability, efficiency and productivity, ability to generate funds for expansion, level of profits, likely flow-on effects of cost increases and public interest considerations.

I am aware that these and other elements are considered relevant in inquiries held by the Prices Justification Tribunal when examining applications for increased prices. It would therefore seem appropriate that stevedoring companies seeking to increase the prices they charge should do so in the full light of examinations of this nature. The Government is aware of a number of applications from stevedoring companies to the Prices Justification Tribunal which are currently under examination. As well, the Government considers that there should be supervision of any unreasonable market power in all industries and thus the stevedoring industry is no exception. The Government notes that the Trade Practices Commission is examining various applications by stevedoring companies relating to methods of fixing charges associated with wharf handling etc. of inward and outward cargoes.

Conclusion

As is pointed out in the detailed position statement prepared by Mr Justice Northrop, no submission made to him favoured the retention of the existing arrangements but with the temporary legislation amended on a permanent basis. For the Government to impose itself on the industry to the extent of becoming the direct employer of those working in the industry would be inappropriate, unwarranted and would not be a forward step. Nor would it bring a normal employer-employee relationship. It would create a situation where the Government would be employing workers but would have no responsibility for the operations on which they were engaged while the companies carrying out those operations would have no control of the labour. This would be a most abnormal arrangement. It is the Government’s view that it is logical and progressive to encourage normal employeremployee relationships in this industry and that in doing so the employers and employees must accept the restraints and responsibilities inherent in such a situation.

Therefore it is proposed that to allow this industry to be placed on a basis which is as normal as possible the following steps are to be taken: The existing temporary legislation is to be continued until 31 December 1976; the ASIA is to continue its existing operations until 31 December 1976; arrangements will be put in hand to assist the staff of the ASIA as outlined earlier; the Stevedoring Industry Council, under the Chairmanship of Mr Justice Northrop, is to continue until 3 1 December 1976; the employers and the Waterside Workers Federation will be asked to indicate the steps being taken to reduce the existing size of the workforce; the employers and the Waterside Workers Federation will be required to submit for my consideration details of the arrangement proposed to deal with recruitment, redundancy and means of coping with the fluctuating labour requirements of the industry; the employers and the Waterside Workers Federation will be asked to evidence means of securing adequate labour allocation arrangements; satisfactory arrangements have to be determined concerning funding arrangements for the industry; proposed consultative machinery should provide details concerning effective representation of user interests, for example, the Australian Shippers Council and other relevant bodies such as the Australian Ports and Marine Association.

The Government in the months ahead will be looking to those involved in the industry to develop a satisfactory framework within which those matters I have mentioned and others that have troubled this industry will be faced in a positive and responsible manner. In this speech I have sought to outline the Government’s aims, but it is clearly the responsibility of those who would seek to be free of the legislative and regulatory requirements imposed for historical reasons in this industry to demonstrate their capacity to act with reason and restraint and with the community interests to the fore. This speech is not the Government’s final word on the future of the industry, but I have sought to give a clear indication of the way the Government believes the industry should develop. The speech is therefore designed to provide the outline within which detailed plans can be developed over the next 6 months for implementation of the arrangements I am foreshadowing. The Government will be strengthened in what it considers to be the normal, progressive and responsible course of action by the demonstrated attitudes of those in the industry during the months ahead.

Finally, I must say that it is recognised that in recent years direct government involvement in the industry has centred on its limited and diminished regulatory role. Now it considers that, in the light of the trend of recent years, that role is no longer necessary. This is not to say, however, that it will no longer give attention to and seek to influence events and attitudes in relation to those matters affecting the industry which give greatest concern to the community generally. But for these matters to be given government attention does not require the continued presence of a government regulatory agency. To enable what I have put forward to be implemented it is necessary to extend the operation of the Act. Before asking honourable members to agree to such a course I believe they and everyone concerned with the industry and the community generally should have a clear indication of the Government’s intentions. It is for this reason that I have set out those intentions in such detail. I commend the Bill to the House.

Debate (on motion by Mr Willis) adjourned.

page 2025

STEVEDORING INDUSTRY CHARGE AMENDMENT BILL 1976

Bill presented by Mr Street, and read a first time.

Second Reading

Mr STREET:
Minister for Employment and Industrial Relations · Corangamite · LP

– I move:

This Bill seeks to extend the operation of the Stevedoring Industry Charge Act 1947-1975 from 1 July 1976 to 31 December 1976. The Act provides for the imposition and collection by the Commissioner of Taxation of a levy upon registered employers of waterside workers. The charge is based on the number of hours worked by waterside workers and its proceeds are used by the Australian Stevedoring Industry Authority to meet its statutory commitments. The Act defines the maximum rates of charge and the actual rates are prescribed by regulation. The most important of the rates is that payable in respect of registered waterside workers employed on weekly hire at permanent or continuous ports; that is, for approximately 85 per cent of the work force. This rate is presently $4 per man hour, which is the maximum defined by the Act. It is not proposed to increase the rate of charge. The amendments being made by this Bill are in consequence of the proposal to extend until 31 December 1976 the operation of the Stevedoring Industry (Temporary Provisions) Act 1967-1974 and will provide moneys for the continuation of financial arrangements in the industry during the proposed extended period of operation of the provisions of that Act. I commend the Bill to the House.

Mr Chipp:

- Mr Deputy Speaker, I seek the indulgence of the House to ask the Minister a question on this matter. It will take me 10 seconds to do so. Will the Minister confer with the Leader of the House in order to ensure that, if possible, a maximum amount of time is set aside for debate on these very fundamental issues?

Mr STREET:

– I will be happy to seek time from the Leader of the House to enable an adequate debate to take place.

Debate (on motion by Mr Willis) adjourned.

page 2026

STANDING COMMITTEE ON ENVIRONMENT AND CONSERVATION

Report

Mr HODGES:
Petrie

-On behalf of the Standing Committee on Environment and Conservation I present the first report of the Committee on land use pressures on areas of scenic amenity. A limited number of copies of the report is available in the Bills and Papers Office and copies of it have been placed in the Parliamentary Library. Additional copies will be available for general distribution in the near future.

Ordered that the report be printed.

Mr HODGES:

-Mr Deputy Speaker, I seek the leave of the House to make a short statement in connection with the report.

Mr DEPUTY SPEAKER (Mr Lucock:

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

Mr HODGES:

– The report on land use pressures on areas of scenic amenity, which has just been tabled, is the first report of the Standing Committee on Environment and Conservation established in the Thirtieth Parliament. The purpose of this report is to place before the Parliament the results of an inquiry into land use pressures conducted by the Committee in the Twentyninth Parliament. That Committee’s report had been completed and adopted, but the dissolution of the previous Parliament prevented it from being tabled. The Committee decided not to reopen the inquiry but rather to table the report of the previous Committee without change. The Committee, however, cannot give unqualified support to the findings and recommendations. The Committee believes, however, that the report should be made public and that its publication should provide the basis for worthwhile discussions and debate by honourable members and the community in general.

The report of the previous Committee deals with the problems generated by land use pressures and conflicts in attractive areas near major cities. Australian metropolitan areas have extensive tracts of recreational land within accessible distance. There is frequently a conflict of interest between such land uses as residential and industrial development, tourism, recreation and water catchments. Since a large proportion of our population lives in the large metropolitan areas, the solutions to the land use problems that inevitably occur are not really local in character, but rather are of major national significance. The previous Committee believed that there is little evidence that the State governments have the resources to handle the problems, despite the interest shown by them.

The Committee selected the Dandenong Ranges and the Mount Macedon region in Victoria as case studies. The major reason for selecting those areas was that in a national context the Dandenongs, being close to Melbourne, are probably suffering from development pressures more than is any other comparable area and that the Macedon Range, which is situated on the other side of the same city but at a greater distance, will encounter the same pressures as Melbourne grows. The report contains 30 recommendations dealing in the main with increased Commonwealth-State involvement and cooperation in the area of land use planning and the need for large inputs of Commonwealth funds. I again stress that the views expressed in the report do not necessarily reflect the attitudes of the present Committee.

There are 2 final points that I wish to make: Firstly, I would like to thank the members of the previous Committee for the contributions made- in particular, Mr Lamb, Mr Jarman and Mr Morris, who were members of the Subcommittee which conducted the inquiry. Secondly, on behalf of the Committee I would like to thank Mrs Lyn Simons, who, as Secretary of the Sub-Committee, provided invaluable assistance to the inquiry. I commend the report to the House.

Dr JENKINS:
Scullin

-Mr Deputy Speaker, I seek the leave of the House to make a brief statement on the same subject.

Mr DEPUTY SPEAKER (Mr Lucock:

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

Dr JENKINS:

-I thank the House. I believe that the Standing Committee on Environment and Conservation of this House is to be commended for tabling this Report on land use pressures on areas of scenic amenity, which, as my colleague the honourable member for Petrie (Mr Hodges) has pointed out, is the work of the Committee in the previous Parliament. As the honourable member indicated, this was one of several sub-committee investigations carried out by the Committee. It illustrates that with committee investigations members of Parliament generally operate better when the subject matter is interesting and there is considerable public interest. I trunk it would be fair to say that 2 members who worked in this sub-committee area would need to have declared some personal interest. When the inquiry was initiated one member of the sub-committee was the former honourable member for La Trobe, Mr Tony Lamb, who chaired the sub-committee. Of course, his electorate encompasses the Dandenong area. The present Government Whip, the honourable member for Bendigo (Mr Bourchier), was concerned with the Macedon area, which is in his electorate. So when the inquiry commenced 2 members of the Parliament, one from each side, had a pretty fair knowledge of the problems being investigated because they were associated with the affected areas.

When it is said that the present Committee cannot express unqualified support for the recommendations of the original Committee, I think it should be made clear that we are not suggesting that the report of the Committee of the last Parliament was an expression of Government attitude. Indeed, it was the result of a decision made by all parties. Of course, the new Committee cannot express unqualified approval of something it has not investigated.

Although the attitudes of the Government to the issues covered in the report may have changed in their orientation since the original report was written, there are 2 important points which should be made which are still valid. The first is that if a co-ordinated system of land use throughout Australia is to be achieved then planning should not be on a regional basis alone. The nation as a whole has an interest, for example, in ensuring that scenic recreation areas near major cities are preserved. It is obvious that initiatives should be taken by the national Government. Regional planning bodies frequently do not have the resources to handle complex planning problems alone. The Committee’s report stresses that the responsibility for ensuring comprehensive planning is a 3-tiered one involving national, state and local government. The other point is that there have been a number of attempts in recent years aimed at solving the problem of land use competition. Few of these seem to have been very successful. One of the reasons for this is that recommended courses of action have been complex and theoretical. In the report we are debating I believe that the Committee has gone out of its way to make the recommendations practical and relatively easy to implement. In this respect it has relied heavily on evidence from State and local government. Co-operation between the 3 levels of government is essential if planning proposals that will both protect the environment in these sensitive areas and preserve the rights of residents are to be found.

Often there is resentment of investigation by a committee of the national Parliament when matters affect State or local government. With this inquiry, while there was some initial defect in communication on our part, I commend the Victorian Government and local bodies for their generous co-operation in the inquiry. None of the 3 tiers of government should worry about such inquiries. There will certainly be differences of political philosophy, but provision of a public forum, and frank exchange of views and information, will lead to constructive suggestions for solutions of problems. I believe this report will be mutually beneficial to the 3 tiers of government. I join the honourable member for Petrie in thanking the members of the Committee ‘s staff and the work done on this project. I commend the report to the House.

page 2027

ROAD SAFETY AND STANDARDS AUTHORITY (REPEAL) BILL 1976

Bill presented by Mr Nixon, and read a first time.

Second Reading

Mr NIXON:
Minister for Transport · Gippsland · LP

– I move:

This Bill is quite straight forward. As we have already announced, the Government has decided to reverse the previous Government’s decision to establish a Road Safety and Standards Authority as a separate entity. This Bill will give effect to that decision by repealing the original Act. Honourable members will recall that there were a number of comments on this decision during the recent debate on the reappointment of the Standing Committee on Road Safety. I would like to repeat the assurances which I gave to the House on that occasion. This move to have the functions and activities of the Authority carried out by the Department of Transport does not in any way signify a lessening of our commitment to road safety. The decision has been taken as part of the Government’s drive to achieve savings in administrative costs. Honourable members will no doubt recall that at the same time as the decision with regard to the Road Safety Authority was announced, similar moves were also announced in relation to a number of other authorities and commissions of inquiry. Overall, we intend to achieve substantial savings and increased efficiency from these moves. Reincorporation of the Authority into the Department will save substantial amounts. It will also allow administrative savings within the Department. We simply cannot pass up such opportunities if we are to achieve our aim of reducing the Budget deficit and clearing up the very difficult economic circumstances bequeathed to us by our predecessors.

Despite the fears expressed by the Opposition, this decision does not mean that we will be saving expenditure at the cost of our road safety activities. All we are doing is avoiding unnecessary duplication. I would also remind the House that the establishment of the Authority was only in its very early stages when our decision was taken. The functions of the Authority were carried out by staff virtually all of whom were transferred from the Department. In fact those officers are still located in the Department’s Melbourne office. They will simply be returned to the departmental strength by normal administrative process under the Public Service Act. The efficient use of staff is, of course, the key to the whole situation and the rationale for the decision. We intend to maintain the staff involved as a complete unit within the Department of Transport. We can retain all the advantages claimed for the separate organisations. At the same time we do not incur unnecessary costs which would have to be at the expense of the actual work on road safety. As I have already mentioned, action is in hand to transfer the staff of the Authority back to the Department at the earliest possible date and I am extremely anxious to maintain the morale and team spirit which exists within that group when it is returned as part of the organisational structure of the Department.

I would also like to stress that the budgetary savings I referred to do not mean that we have given up the intention of providing the road safety facilities originally proposed to be established for the Authority at Albury-Wodonga. Of course, we will not be outlaying funds during this financial year on these facilities. This is simply because we are re-examining the possible scheduling of these works to see how best we can provide the required facilities bearing in mind that it is essential for us to make the maximum use of those facilities which are already in existence. The final point I wish to make is to repeat the undertakings I gave to the House when moving for the reappointment of the Standing Committee on Road Safety. These were to continue our support for research, to continue our work through the Australian Transport Advisory Council and its advisory committees and to continue our program for progressive improvements to our roads and highways.

I now put a brief outline of the Bill. As already indicated, the existing legislation- that is, the Road Safety and Standards Authority Act 1975- is to be repealed. This is provided for in clause 3. Clauses 5 and 7 to 10 set out the necessary consequential administrative provisions involving return of funds and transfer of obligations to the Commonwealth. The funds will be available to the Department of Transport for discharging liabilities incurred by the Authority making payments under any contracts etc. entered into by the Authority and meeting the costs and expenses that would have been incurred by the Authority in the performance of its functions. Clause 6 meets the technical requirement arising from the Officers Rights Declaration Act with regard to the Authority Chairman, who is an officer of the Commonwealth Public Service. The clause deems the Chairman to have resigned on the last day of the Authority’s existence thus safeguarding his rights as a public servant. The remaining clauses provide for citation, definitions and so on and provide for the Bill to come into operation on the date it receives royal assent. Finally, clause 1 1 places upon me the obligation to report to the Parliament on the operations and finances of the Authority. The financial report will, of course, be subject to the usual certification by the AuditorGeneral. I commend the Bill to the House.

Debate (on motion by Mr Morris) adjourned.

page 2029

CIVIL AVIATION (CARRIERS’ LIABILITY) AMENDMENT BILL 1976

Bill presented by Mr Nixon, and read a first time.

Second Reading

Mr NIXON:
Minister for Transport · Gippsland · LP

– I move: That the Bill be now read a second time.

This Bill is primarily designed to amend the Civil Aviation (Carriers’ Liability) Act 1959-1973 so as to increase the limit of liability of airline and charter operators in respect of the death or inj ury of passengers carried on domestic air services. The Civil Aviation (Carriers’ Liability) Act gives the force of law in Australia to the Warsaw Convention, made in 1929, and the Hague Protocol to that Convention, made in 1955. These international agreements are the primary means of regulation of the right to recover damages arising from travel on international nights. Part IV of the Civil Aviation (Carriers’ Liability) Act applies similar conditions to airline and charter operators in domestic services, and it is in this regard that the Government proposes the amendments incorporated in this BUI.

The basic Warsaw principle, as applied to Australian domestic operations under Part IV of the Act, is that a carrier is liable for assessed damages sustained by reason of the death or personal injury of a passenger resulting from an aircraft accident. The legislation makes the carrier liable for damages without the need for the injured party to prove negligence on the part of the carrier, but the damages payable may be adjusted if it is proved that the passenger caused or contributed to the damages. The Act limits the liability of the carrier in respect of each passenger to $30,000. This limit was fixed in 1970, the previous limit having been $ 1 5,000.

Subsequent to the Warsaw convention and the Hague Protocol, under an arrangement initiated by the United States Government and the International Air Transport Association and known as the Montreal Agreement, a large majority of international airlines, including Qantas Airways Ltd, now accepted higher liability limits for each passenger carried on an international night starting, ending or stopping at a point in the United States. Qantas in fact now accepts the higher liability limit of approximately $45,000 for all its international flights. The British Government has directed all British operators to apply world wide a new limit of liability of approximately $45,000. Other European governments are contemplating similar action, each in respect of its national airlines. Therefore to ensure that passengers carried on domestic services in Australia receive the same cover as those on international flights, and having regard to a level of compensation in real terms, I consider it would be appropriate to increase the liability limit of domestic air carriers from the present level of $30,000 to $45,000.

The maximum amount of compensation specified by the Act, as well as by the international agreements, is not an automatic entitlement. An injured passenger, or the dependants of the deceased passenger, claiming compensation from an airline whose aircraft is involved in an accident, must prove that damage has been suffered by reason of the accident, and the amount of damages is assessed in accordance with the ordinary principles of law. When the assessed damages are less than the maximum amount mentioned in the Act, they are recoverable in full. Otherwise, the carrier’s liability is limited to that amount. I should add that these arrangements and Limits refer only to the liability of the air carrier to the passenger or his dependant. Naturally they do not preclude a passenger from insuring his life or person quite independently for any amount he chooses. The airlines and the representative organisation of the charter operators accept that it is appropriate to increase the limit of liability as now proposed, and they are prepared to pay the modest increase in insurance costs involved.

As will be seen from a perusal of Part IV of the Act, for constitutional reasons its provisions are not applicable to intrastate services, except in the case of those operated by Trans-Australia Airlines. However, with the exception of Western Australia, the States’ legislations are amended correspondingly with Part IV of the Commonwealth Act as it is amended from time to time. The Premier of Western Australia has been invited by the Prime Minister (Mr Malcolm Fraser) to take complementary legislative action in regard to increasing the limit of liability. The Civil Aviation (Carriers’ Liability) Act is a significant legislative measure in the functioning of the air transport industry in Australia. It is based on principles recognised throughout the world. The proposal now submitted for consideration by the Parliament is designed to up-date the Act by increasing the limit of liability to $45,000, thereby fixing a more appropriate level of compensation having regard to current international arrangements and current money value. I commend the Bill.

Debate (on motion by Mr Morris) adjourned.

page 2030

AIR ACCIDENTS (COMMONWEALTH GOVERNMENT LIABILITY) AMENDMENT BILL 1976

Bill presented by Mr Nixon, and read a first time.

Second Reading

Mr NIXON:
Minister for Transport · Gippsland · LP

– I move:

This Bill comes within the administrative responsibility of my colleague, the Minister for Social Security (Senator Guilfoyle). However, because the BUI complements the Civil Aviation (Carriers’ Liability) Bill 1976 which I have just introduced the Minister for Social Security has asked me to present this Bill to the House. This Bill amends the title of the principal Act from the Air Accidents (Australian Government Liability) Act to the Air Accidents (Commonwealth Government Liability) Act. This is consistent with the general policy of the Government as announced earlier this year. The Bill further pro.vides that the maximum amount of the Commonwealth’s liability in respect of death or injury resulting from air accidents be increased from $30,000 to $45,000. 1 commend the Bill to the House.

Debate (on motion by Mr Morris) adjourned.

page 2030

AUSTRALIAN CAPITAL TERRITORY ELECTRICITY SUPPLY AMENDMENT BILL 1976

Bill presented by Mr Staley, and read a first time.

Second Reading

Mr STALEY:
Minister for the Capital Territory · Chisholm · LP

– I move:

The purpose of this Bill is to amend the Australian Capital Territory Electricity Supply Act 1962-1973 for the following purposes: Firstly, to replace the references to the Australian Capital Territory Advisory Council with references to the Australian Capital Territory Legislative Assembly; secondly, to amend the provisions of the principal Act dealing with the remuneration and allowances of the members of the Australian Capital Territory Electricity Authority; and thirdly, to bring the language of the principal Act into line with currrent drafting practices. In 1962 the Australian Capital Territory Electricity Authority was established by the principal Act. It consisted of a chairman and two other members one of whom was to be elected by the Advisory Council of the Australian Capital Territory.

In 1974 amendments were made to the Advisory Council Ordinance which amongst other things effectively reconstituted the A.C.T. Advisory Council as the Legislative Assembly. Legal doubts have been expressed that the amendments to the Ordinance could operate to amend the Australian Capital Territory Electricity Supply Act to correct the superseded references. The Bill which in this respect is of a purely mechanical character will bring about this result but it also validates acts or things done by the Electricity Authority and any election by the Legislative Assembly of a member of the Authority since the time the Advisory Council was superseded by the Legislative Assembly. With regard to the second of the purposes I have mentioned, the Bill remakes the provisions of the principal Act dealing with the remuneration and allowances of members of the Authority to take account of the changes in the manner in which their remuneration is now determined by virtue of the Remuneration Tribunals Act 1973-1975. The opportunity has been taken to include in the Bill some formal amendments of the principal Act to bring the language of the Act into line with current drafting practices. I commend the Bill to the House.

Debate (on motion by Mr Bryant) adjourned.

page 2030

APPROPRIATION BILL (No. 3) 1975-76

Second Reading

Debate resumed from 5 May, on motion by Mr Lynch:

That the Bill be now read a second time.

Mr BRYANT:
Wills

-We are back into the twice annual exercise of looking at the public accounts and the way the Government handles the economy. We are dealing with 2 Appropriation Bills. This legislation, which is brought in towards the end of each financial year, covers what one might call the petty cash situation and under this legislation it is to the tune of $500m. In this year it is a very important exercise because the Government has chosen to adopt as its theme ‘savings’- savings of public expenditure. In almost every instance, according to the document tabled in this House upon the introduction of this legislation, there has been some deprivation of some citizens somewhere. Here we are in 1976 in an age of extreme challenge, an age that asks for inspiration and we seem to be inflicted with the most shallow and irrelevant Government possible. The Prime Minister (Mr Malcolm Fraser), the Treasurer (Mr

Lynch) and the Minister for Defence (Mr Killen) are going through a whole series of charades, one might say, chanting one after the other certain forms of public advice about how they will save Australia from the past. They include a reduction in the size of the Public Service; cuts in government expenditure, budgetary savings; we have to reduce social security; we have to tighten our belts. But on the other hand, we have to spend up big. A kind of Liberal litany has developed which will not solve anything. The 1976 challenge seems to me to make this Government more irrelevant than even its Liberal-Country Party predecessors even though many of them were members of the previous Government. What defeats me in my examination of Australian politics is how the people of Australia could have forgotten so soon what these people opposite were like the last time they were in office.

What is the situation now? Productivity in Australian industry in almost every case has practically outrun consumption needs, in most areas anyhow. Factory after factory throughout Australia is reduced to about 80 per cent capacity but industry is still able to out-produce the needs of the citizens as defined by the things they buy. There is no shortage of television sets, colour or black and white. There is no shortage of refrigerators, motor cars, railway lines or anything else. Broken Hill Pty Co. Ltd is running at perhaps 80 per cent capacity. I represent one of the great industrial areas in Australia which produces almost all things that society needs. It has one of the world’s largest, I suspect- and certainly one of the largest in countries such as ours- photographic manufacturing institutions. It produces about five-sevenths of Australia’s hosiery. It was one of the centres of the Aus.tralian textile industry. It has a large involvement in componentry for the motor vehicle industry and so on through the whole catalogue of human needs.

Some of the factories of course are not all that aesthetically pleasing. They do not look too bright from the outside. There is a certain functional approach by Australians to expenditure on what one might call investment. If the building stands up it may well have inside it some of the most sophisticated equipment in the world. One of the things that has struck me over the last few years is how very small industries will spend very large sums of money to bring themselves up to date. Whether industries are making shirts, whether they are in the field of moulding or whether it is the Australian Government Clothing Factory they are matching the world in productivity. There is very little that we can do to absorb all their manufacturing capacity even by inciting the citizens to spend. Nobody is going to rush out and buy an extra couple of motor cars because the Prime Minister thinks he ought to. Nobody is going to buy another dozen shirts.

This is probably one of the greatest challenges of the last 300 years. It is a state of change that is as fundamental, as far as I can see, as that which came over the human intellect when Copernicus issued his challenge that the world was not the centre of the universe, that the world went around the sun, the sun did not go around the world; or when Columbus clarified the issues for all who cared to look that the earth is round; or the collapse of imperialism over the last fifteen or twenty years which has changed the shape of international affairs and put about 150 nations into the world- a series of water-sheds. This is the biggest one in our area since the Industrial Revolution, yet the Liberal and Country parties continue to talk as if cliches such as free enterprise, the judgment of the market place and less government will solve the problems; all this despite the lessons of history.

We have become intellectual refugees taking refuge in formulae instead of doing proper analysis both of society and industry and all that goes with them. It is not an accident that Australia faces the same problems as France, Britain, West Germany, United States of America and Canada. It is not an accident. It is one of the products of the last 30 years. For centuries Europeans have spent their time destroying their cities and destroying themselves. The world has been torn with war twice in my lifetime. In the last 30 years, although there have been enormous troubles in the world, there have been no great constructive exercises on a global scale. It would probably be fruitful for some of the people to visit Europe just to take a look at Eprave, Berlin and Warsaw, places which were destroyed 30 years ago and have been completely rebuilt. The productive capacity, the ingenuity and all the things that went into rebuilding them are now faced with no work. In this country there are enormous things still to be done but the fact is that it will only be government enterprise that will do most of them. So all the formulae that we hear about so continuously, the argument about deficits, the argument about interest rates, the sudden interest in consumer psychology and this talk about the economic situation, are not going to solve anything. I think that the theoretical base upon which we face up to these problems is incorrectly centred. It is money centred. We hear continuously of the cash flow, the volume of money and all the other factors that go to make up the economic environment. In my view we should be looking more particularly and more carefully at a resource centred view of the economy. We should be asking: What are the resources? Where are they? How do we put them to work? What is the machinery needed to do this? In many areas it has been the financial machinery of the banking system that has kept people employed.

When we look at the situation we see that the private citizens have most of the things that they want. Let me say in parenthesis that probably the big deficiency in Australia is still a proper and appropriate housing policy. My colleague the honourable member for Hughes (Mr Les Johnson), a former Minister for Housing and Construction, used to tell me that 400 000 new or rehabilitated houses were needed in Australia; that every year the demand is about 160 000 or 170 000; and that the Australian industry can produce, perhaps, 180 000 houses a year. But housing is one of the first victims of every cold economic wind. The Government reduces the amount of money available, puts up interest rates or does something else to inhibit it.

We face a mathematical and social and economic challenge. Australia has some 13.S million people, of whom 5.6 million or thereabouts work. They have to look after all the rest. There are people who would include us, the politicians, in all the rest- except for my friend the honourable member for Oxley (Mr Hayden), who has just come into the House. He is a member of the toiling masses. He has contributed a great deal to the advantage of this country. I hope that the people in power at the moment do not reverse that trend. There are a couple of million people in retirement. There are probably 3 million people doing household work. There are another 3 million people who are not yet in the work force. We have an economy second to none in capacity to handle the situation; but so far we have not found the wit or the wisdom to do that. I suspect that honourable members on the Government side have not the will to try to do it. One of the odd beliefs that flow from the past is that if a person is out of work it is his own fault; unemployment is a peculiar state of sin which is inflicted upon a person who did not pick the right parents.

What was the state of the economy under the Labor Government? We have been berated about it continually. First of all, the lot of the people improved. Average weekly earnings went up quite a deal. My friends on the Government side would say that they went out through the roof and rose astronomically. But I happen to represent many people who were beneficiaries of the Labor Government. In about last December I did some arithmetic to see what the increase in the average weekly earnings meant to them in comparison to their situation 3 years before. I will mention a few figures. In 1972 a person could buy 170 lb of butter with the average weekly earnings, but in 1975 210 lb could be purchased. In 1972 a person could buy 372 loaves of bread with that amount, but by 1 975 that had risen to 420 loaves. This happened right down the line- in respect of tea, lamb, rump steak and bricks. For honourable members who are interested in such things, I point out that in 1972 7.5 weeks work was required to pay for a return air fare to London, but by the end of last year only 6.1 weeks work was required. Consideration of the air fare to Perth might be more in our line. A person had to add $9 to the average weekly earnings in 1972 in order to go to Perth, but by the time we had finished in government one could get $5 change from the average weekly earnings. I suppose that most Australians could do this sort of homework by looking at the household accounts, but unfortunately they were talked out of doing it.

There were other areas of strength in the economy. Like everybody else in this House, despite what some honourable members say on occasions, I regret the unemployment situation. I believe that we just have to apply ourselves to the job of seeing that everybody is satisfactorily and gainfully employed if he wishes to be. The export-import ratio was in a better situation in Australia than in most other countries. Our overseas balances were higher than those of most other countries. One of the enormous changes which took place under Labor and which our friends opposite are going to do their best to reverse was the shift of wealth towards the private citizen. Wages and salaries, as a proportion of the gross domestic product, went up by 5 per cent or 6 per cent and, of course, profits fell by something of the equivalent order. Apparently that is sinful, according to honourable members opposite. Many people have been talked into taking the view that theoretically that is bad. I think that household savings in proportion to the total national savings doubled. This placed the wealth in the hands of the people who need it. Any reversal of that situation can only reduce consumer spending.

What about the last Budget? We produced 3 Budgets. The 1973 Budget established a new environment for so many things- education, health services, Aboriginal advancement and all the rest. The 1974 Budget held the ground. The 1975 Budget was designed to balance everything out as well as we could with the apparatus at our disposal. The apparatus at our disposal to control the economy is meagre indeed. Some of this balancing has to be done as a matter of judgment and some of it by means of simple government action, hoping that it turns out well. We are accused, of course, of extraordinary extravagance because there is a deficit. Total expenditure in the last Budget was about $22,000m.

Let us break that sum up into 3 parts. Firstly, the Australian Government expended $ 13,600m on its services and the States $8,300m. I think anticipated receipts were somewhere between $ 18,000m and $ 19,000m; so there was adequate money to meet the running expenses of the Aus.tralian Government and the State governments. But, of course, there is a huge amount of capital works, which take up about $ 1,000m in the case of the Australian Government and about $3,000m in the case of the States. One of the oddities of our statistical base is that no one can say how much of the States’ money goes into capital works. Most Budgets are much less precise and informative documents than ours, and information is buried in them. One cannot necessarily tell, for instance, how many schools are built with money spent on education. In the last Budget something between $4,000m and $5,000m was for capital expenditure; that is, the creation of assets for the future. Those assets are important to every one of us.

How on earth can people call that kind of thing a deficit? Is it not possible to create a new word? The word ‘deficit’ is a misnomer. Perhaps we should produce our Budgets in 3 parts, with one of them called the investment account. How could 20 000 government homes be part of a deficit? How could a million bales of wool- I am not sure how many we bought out of the last Budget- a new water storage system or 50 or 1 50 schools be part of a deficit? If we are not careful we will talk ourselves out of progress by thinking of the deficit in the same terms as we would think of a loss situation if we were conducting a corner shop or if we were getting $20,000 in income and spending $22,000 on our current account. Occasionally one gets into that situation in domestic life.

Mr Graham:

– Not for long.

Mr BRYANT:

– That is right. If the honourable member had an income of $20,000 in a year and bought a $50,000 house that year he would not write that transaction into his household accounts at the end of the year as a $30,000 deficit. Of course, he would not. He would have created capital for the future. Therefore, we have to take a very close look at the way we go about these things.

There are a number of points that one wants to make on an occasion such as this. For the last 8 or 9 months- in fact, for almost the last 2 years, but certainly since early last year- there has been the most vigorous assault possible upon the idea of government expenditure. What does government expenditure mean to every one of us? In the Australian community, in social and economic affairs government expenditure is the key to progress in nearly everything. First of all, there are the ordinary welfare payments, which took up about $6,000m in the last Budget. Then there are the socially oriented enterprises, such as health, education and general welfare. Does any honourable member deny that those things should not be carried out? As I pointed out earlier, those things are easily carried out on the current account inside the tax collections. But what about the rest of these things? In Australia and, I presume in other countries too- we know our own country best I expect- the communications base supplied by government expenditure is fundamental to Australian industry. How long would Australian society and industry carry on if the Post Office stopped work totally for even one hour; if for one hour throughout Australia no telephone rang?

Mr Hayden:

– Wonderful.

Mr BRYANT:

– Some of my friends here think that would be a good thing; it would leave us alone. But Australia would come to a standstill. We had a dramatic instance of that when the system of communications to Darwin was blown out by Cyclone Tracy and we had the almost impossible task of finding out what had happened. In this country almost all transport is based upon government expenditure, government capital works, government initiative. Nobody else is going to do it. My friend the Prime Minister can plead as much as he likes to all his friends, rich and poor, to go out and spend, but there is not one of them who can build another railway line; and it is pretty pointless building trams. Not many of them are going to start building ships, and the same applies to road, rail, sea and air. The supplies for the power base for a lot of industry- electricity, gas and coalthroughout a good deal of Australia are in government hands. The same applies to banking and insurance.

One wonders how we got into this state of mind whereby a document entitled Statement of Savings Expected in Annual Appropriations made by a number of Acts- is tabled in this Parliament. I do not know what the honourable gentleman and his colleagues mean by that. Is there anybody who would call this saving? The adult migrant education program was cut by $419,000; the child migrant education program was cut by nearly $lm, and the Aboriginal advancement program reduced by $3.7m. What kind of philosophy is that? How insensitive can the Government be when it calls a reduction in those fields of endeavour ‘savings’.

Mr BAUME:
Macarthur

– It is interesting to follow the honourable member for Wills (Mr Bryant) and to hear an attitude for which I suppose the polite word is ‘oldfashioned’. It seems so out of keeping with the reality of the world today to hear a man talk about what is happening to textile factories, for example, in his electorate. I can assure him that this situation applies to those factories in my electorate. The honourable member did not mention the fact that his Government introduced a 25 per cent tariff cut which did more than any single thing to destroy employment in the textile industry, particularly the employment of women who, in many areas of Australia, do not have alternative employment opportunities available to them. I know that in my electorate it is a shattering blow to look through the empty, partly used, or certainly under-utilised in almost every case, textile factories in the area.

It is also interesting to hear the old-fashioned view holding that ‘profits’ is a dirty word. Once again the honourable member for Wills chooses to ignore the fact that if it were not for the profits earned by companies and their capacity to invest in new plant and equipment and to employ people there would not be any employment. There would be the sort of downturn in employment, the inactivity and the economic disasters we are now having. The honourable member has yet to wake up to the fact that one of the major reasons for the current economic uncertainty, for the current high unemployment, for the current failure of the Australian economy to be expanding its productivity is exactly the profit bashing that he supported. When an ordinary person goes out to work he is seeking to maximise his own profit. He is trying to make as much money as he can so that there will be a suitable gap between his costs and his income- that personal gap in every household which gives him a disposable income; an income which he can dispose of by choice is a degree of profit.

It is a curious thing that it is worthwhile and honourable, according to the Opposition, for people individually to pursue profit, but it is disgraceful if it happens to be a corporation that is pursuing profit. What a curious idea particularly when even the Opposition must by now recognise that it was a failure of the private sector in Australia to earn profits- this was under the Labor Government’s profit bashing activitieswhich brought about a diminution in the pool of resources from which we were trying to pay for welfare, from which we were trying to meet all the demands of our society. If you do not replenish that pool, if you do not provide the money or the national wealth from which to meet the demands of welfare, if you keep paying with non-existent Hayden cheques on a nonexistent bank account, then you simply destroy out society. That is what destroyed the economy of this nation more that any other single activity. It is extraordinary to hear still from the Opposition this sort of 1930s mentality. Honourable members opposite are the true conservatives of this House, people who have not progressed past the depression psychology, the anti-business psychology, the anti-profit psychology, the antiwork psychology, the anti-effort attitude. It would be a wonderful day when the Labor Party progressed its thinking past 1930. In the meantime, I suppose that we at least do know where true conservatism lies in this House.

I should like to deal now with a matter which is of real concern to me and, I know, to many other honourable members on this side of the chamber. It is the extent to which any government’s capacity to make welfare payments to the needy in the society is being diminished by the massive cost of making those payments, the huge rises in administrative costs. This is not a subtle attack on the Public Service. This is not an attempt to say that the public servants are not doing the right thing or are not working hard enough. That is not the issue at all. The facts are that as a result of massive increases in administrative costs there has been a reduction in the capacity of the Department of Social Security, for example, to meet many of the commitments that I believe that that Department should be looking to meet. An increasing amount of its moneymoney that should be going in welfare payments -is now going in administrative costs. Surely we should be looking at this whole matter of administrative costs if we are really trying to increase the amount that is going to pensioners of all categories within the economic constraints that have been set upon us by a reckless administration over the last 3 years. The Labor Government showed no restraint in looking at administrative costs. There were massive increases and, I would submit, to a large degree inefficient increases in the actual methods by which welfare was handed out. What I am distressed to see is that in this legislation before the House we see that for the appropriation for the Department of Social Security there is a necessary increase of $21m in the current year in order to meet the commitments under the previous Government’s Budget. It is reasonable- it happens every yearthat there has to be an additional appropriation. But what I want to stress is that of that $2 lm, 73 per cent- almost three-quarters of it- is going in higher administration charges, that is, salaries and administration expenses. The fact is that the major single item is postage, which is up $7.2m. Here, in fact, we have a simple juggling trick. On the one hand the Government is paying an extra $7. 17m and on the other hand that government commission is taking it. We are seeing money that we would have hoped might have been available for welfare ending up in the hands of the postal authorities which are now, of course, in a separate organisation.

One wonders really what is the cost to this nation of having this curious kind of accounting where money goes from one pocket to another. It is as if this were all done with mirrors. It appears that the social security vote has gone up when in fact really the postal and telecommunication sections are benefiting. I stress, however, that there has been a $ 15.1m rise in this kind of expense over the Budget allocation.

Let us look at what really has happened compared to the situation last year. Let us look at the consequences of the Hayden Budget because the allocations we are now considering are simply an updating, a putting into current terms, and a providing of the money needed for the programs that were instituted under the Hayden Budget. For example, salaries of the Department of Social Security in 1974-75- that is exactly one year ago in terms of the measure we are now looking at- amounted to $56.56m. As a result of the additions in the legislation before us they will be $72.24m. This represents a total rise of $ 15.7m or 28 per cent in one year. At the same time administrative expenses have gone up from $ 17.07m in 1974-75 to $27.5m. This is a rise of $ 10.4m or 61 per cent in administrative expenses. The total result is that the rise in this one Department in one year for salaries and administrative expenses has been $26m or 35 per cent.

It strikes me that this is a most unfortunate feature of what inflation does to our capacity to pay welfare to the community of this nation. As a result, $100m of the social welfare vote is to go into the area of administration and salaries instead of to pensioners. It could be said that it is going to public servants, not to the needy. It is obvious that a large proportion of this amount would have to go to the administrators anyway no matter how well organised the payment of welfare was in this nation. But I submit that there is a degree of misspending. This is simply not because- I would not argue this in any way -the Department is inefficient. I do not believe that the Department is. I believe that public servants work hard. I believe that the public servants in this Department as in many others are dedicated and seek to serve the public and the pensioners whom they are there to protect. What I do say is that many of the welfare benefits that over the years have made up a large part of the spectrum of welfare in Australia are inefficient. Many welfare payments, particularly small once off payments for special historically sound but now economically unreasonable benefits, simply cost too much to administer because of the massive rise in wages that has taken place, particularly over the last 3 years of uncontrolled and irresponsible inflation.

It strikes me that when we are looking at ways of saving money, or conversely of increasing the proportion of the welfare vote that actually goes to pensioners or to others in receipt of welfare, surely we should be examining how to make certain that these inefficient benefits can be replaced by efficient ones. I would presume from my own experience that it would probably cost something between $10 and $15 to make a once off payment to a pensioner. The once off payment of $40 in the case of the funeral benefit indicates to me that surely there must be a better way of handling such payments. It costs $ 1 5 to administer the payment of the $40 funeral benefit. Is that really the right sort of proportion at which we should be looking? My understanding is that about 2 per cent of the total vote of Social Security is taken up by administration. Yet here we have some specific benefits where the administrative content is something like a massive 30 per cent of the total expenditure.

I believe that we should be looking for ways, as the Henderson report on poverty recommended, of diminishing the administrative cost and increasing the size of the benefit to pensioners. This, of course, could be done in many ways. My own view, for what it is worth, in respect of the payment of the funeral benefit is that surely we could have examined, and I hope we still will, those areas in which we could have saved a good deal of the administrative cost. For example, in the case of the death of a single pensioner the Department could arrange for the pension cheque to continue to go out for one extra week which roughly equals the amount of the funeral benefit. Pension cheques are paid by way of computer. Surely one could press a button on the computer and overprint a pension cheque. For example, one could overprint the cheque to the effect that it is negotiable with any recognised or approved funeral parlour. Of course, there would be no administrative cost beyond the normal costs of providing the computer with the information that a pensioner has died. The same process could be carried out in respect of the death of a married pensioner. The Department could add another 2 weeks of the married pension to the cheques which are sent to the remaining spouse which could be overprinted in exactly the same way at no major administrative cost. The cheques could be overprinted to the effect that they related to the funeral benefit and could be negotiable with any recognised funeral parlour.

In other words, I am suggesting that there are many opportunities for looking at the efficiency of welfare payments, many of which could well be removed because they involve single one off payments or are expensive to issue. Such benefits could be grouped into other larger packages. In other words, although not taking anything away from welfare we should make certain that the bulk of the welfare money goes to the people who should be receiving it. We should replace inefficient benefits with efficient benefits. We cannot afford, and the pensioners of this nation cannot afford, to see such ever increasing proportions of the welfare dollar going in salaries and administrative costs.

The situation is even more dramatic. In fact, salaried administrative costs are up to $100m in the current year. Only 2 years ago salaried administrative costs of the Department amounted to $52.3m. They have almost doubled in 2 years. This situation has been more the consequence of inflation than of major adrninistrative needs to provide major administrative services. Certainly there has been a factor of increased employment in the department. It may well be that if one becomes more efficient and chops out some expensive benefits and replaces them with benefits which are less expensive to administer, the trend of last year can be reversed. Last year the Department of Social Security increased its average employment from 7400 to 8500. I suggest that there is massive scope for this kind of saving. I stress that in the current situation the one year rise of $26. lm in salaries and administration would certainly have been sufficient, if one had to keep the vote steady, to have wiped out things such as the maternity allowance of $7.6m, the handicapped children’s allowance of $7.8m, the orphans pension of $2m and the funeral benefit of $ 1.8m. What would we rather have? Would we rather have money going in public servant wages- not as a result of inefficient public servants but of inefficient benefits- or would we rather have the money going to pensioners? That is the simple problem we face. I believe it is a problem we can resolve.

When talking about the pool from which welfare money is distributed- that is, the pool of accumulated profits of the society and wages earned in the society as a result of active profitability and an active private sector- the PA Consulting Services Pty Limited report on business profitability showed that almost three out of every four industry groups in Australia suffered a lower return on shareholders funds after tax and interest in the latest year. The pool is still going down. The magnitude of the fall in return on shareholders funds compared with the fall on total assets was largely due to the heavy interest burden. In other words, we can see the continuing impact over the last 3 years of the attack on profits. It has attacked everything in this nation. It has attacked our capacity to have the resources to pay welfare. Let us now look at ways by which we can improve our payment of welfare, within the constraints that have been set upon us by the chaotic and inefficient economic policy of the last 3 years.

Mr HAYDEN:
Oxley

-The honourable member for Macarthur (Mr Baume) accused the Opposition of having made ‘profit’ a dirty word during its period of government. I suggest, with the greatest of goodwill in the world to the honourable member, that from his term of service with Patrick and Partners he could not exactly claim to have embellished the term ‘profit’ in the view of the Australian community. Seeing he was talking about the problems of the profit squeeze- a problem in terms of macro-economics and management, which I do not deny for a minute- I leave the honourable gentleman to meditate upon this question: To increase profits he will probably be responsible for a significant squeeze on real wages. In real terms that is a reduction in wages. I sit back and comfortably await the result because I regard it as quite an interesting challenge. Already one can observe the unease which is displaying itself in the industrial field in the Australian community.

I want to make one other comment about the honourable member’s speech before I move on to the matters to which I want to address myself. He laboured at great length the Department of Social Security. I do not want to spend too long in defence of the Department of Social Security. The responsibility of administering the Public Service is a responsibility of the Government of the day. It is always very convenient to score easy points in the first few months of government. As time goes by it becomes a little difficult to improve upon the performance in many areas of preceding governments. I am one who thinks that the Department of Social Security, on balance, works fairly efficiently under very great difficulties. It is a difficult department to administer, involving as it does quite literally millions of personal contacts in the Australian community in the course of discharging its responsibilities.

One of the problems that we face when we are debating financial matters in this chamber is that we sometimes too quickly grab a fistful of figures from one source and make comparisons. I believe the honourable member for Macarthur has fallen into this trap. There are many payments for which the Department of Social Security is responsible which do not show up in the Appropriation Bills under the Department of Social Security. They are churned through the National Welfare Account, I believe it is called. Even allowing for that, the increase in outlays by the Department of Social Security and in staff numbers in the course of this financial year is very simply explained. The honourable member has forgotten already that Medibank became fully operative this year. If the honourable member cares to have a quick gloss through the appopriations and other sources he will find a substantial increase in the responsibilities of the Department of Social Security. I repeat that I believe that it discharges those responsibilities competently, under great strain and not always with the tolerance perhaps that a Minister should display when a department is facing some difficulties. To my knowledge, the Department has never complained.

I moved to the broader issues of economic management and relate them to the Appropriation Bills which are now before the House. I find it rather quaint that the Government is now making a clumsy, crabwise scurry to get on to the consumption led recovery. This is the new rallying cry which the Government is broadcasting in the community. During the election campaign, when the Australian Labor Party pointed out that there could not be an investment led recovery in the economic circumstances then confronting the country and that it had to be consumption led, we were ridiculed. There was willing support from large slabs of the ‘independent’ Press. I hope there are enough inverted commas in Hansard to put inverted commas around ‘independent’ when I couple that phrase with the Murdoch newspapers, not critically looking at that assertion of the caretaker Government. At last the Government has moved towards the appropriate point- the need for a consumption led recovery. We cannot talk seriously about an investment led recovery when more than 20 per cent of the productive capacity in industry is idle. A business man will not spend money, high risk and expensive capital, at a time of high inflation when there is so much idle capacity about. The time limitations on eligibility for the investment allowance will pretty much limit the numbers of people who will be able to draw on those benefits. In turn that will force a lot of people to invest capital equipment. I would like to know what sort of contribution will be made to an economic recovery by providing a subsidy to import labour replacement capital equipment. Not only that, I would like to know to what extent the price will be inflated in cases where a parent overseas company is supplying a subsidiary in this country.

One of the influences which has led to some uncertainty in the community and has disturbed the consumption led recovery which was showing up weakly but showing up nevertheless when we went out of government, has been the completely irrational, ill-informed and irresponsible statements of the Prime Minister (Mr Malcolm Fraser) and the Treasurer (Mr Lynch) about making things tough, implying gloom and horror ahead, tightening up the belts and crying tears of blood. What sort of consumption led recovery could there be with that sort of atmosphere prevailing? A spender with that dark shadow of gloom cast over his pocket would tighten up because he might need the money in the future. I hope that the conversion of the Government to a consumption led recovery, belated as it is, will succeed, because that is what is needed if we are to get a recovery and momentum behind the economy.

Let us look at the relevance of the Appropriation Bills to economic management in the course of this financial year, and more especially to the comments of the Treasurer which we hear drop like pearls from time to time, carelessly and imperfectly formed. When he introduced the Appropriation Bills he said that the Government has, through cuts, saved $478m. In a slightly more modified voice he said that it had added another $S06m in new expenditure. So there is a net increase of about $28m. I concede that it is not much in terms of overall outlays. I want to move quickly to the answer which he gave at question time today when he said rather smugly that the Government would reduce the deficit to $4,200m by the end of the financial year. That sounds pretty grand because everyone has been receiving advice that it would be $5,000m, that it could be worse, and many people have been feeling uneasy about it. Not many people comprehend the significance of a deficit in economic circumstances like those of the moment in which we have to function but for some misguided reason they tend to believe that because the Treasurer or the Prime Minister of the moment makes a comment there is probably some grain of truth in it.

The implications of what the Treasurer was saying at question time were that the Government, through austerity, through restraint and through sacrifice, had been responsible for cutting back expenditure and bringing the deficit down to $4,200m. Pressmen have been asking me: ‘How can the Government do it because it is in fact adding to the total expenditure- not much but a net amount about $2, 800m? That is a conundrum. Outside of social credit, how can the Government do it?’ I think that there is a very simple explanation. About $ 1,000m is to be collected from company tax because the quarterly collections were deferred. There is still about $ 1,000m outstanding. Accordingly, there is no magic in what the Treasurer is saying. He is seeking to spread false claims of achievement which cannot be justified in fact.

I want to go quickly through this issue of the deficit and I hope that I can lay to rest some of the unjustified fears which the Treasurer and the Prime Minister have encouraged in the community. First of all, as I said several times when I was the Treasurer, if the deficit were to be greater than we had projected when we put the Budget together, because revenue fell reflecting a fall in the rate of increase in income, that would be a better position to be in in terms of economic management than the one we had outlined in the Budget. The one we had outlined in the Budget represented considerable restraint in the circumstances in which we were functioning. But this in turn represented an even better situation. That is why the deficit increased. When we put the Budget together revenue collections from personal income tax were calculated on the basis of a 22 per cent increase in average weekly earnings.

That had fallen to about 17 per cent, on the forward projections for the year, by about November and I expect that it is probably down to 14 per cent or 15 per cent. I do not know. We do not hear about these things from the present Treasurer. There was no secret about these things when we were in government. They were mentioned in the Budget statements.

A significant aspect flows from this contraction in the rate of increase in wages. It means that there must be, by a natural order of things, flowing from that appreciable increases available to the Government because the costs which had to be met in the Budget were addressed in terms of a certain rate of increase necessary to meet those costs. Wages represent about 60 per cent of the total cost of goods and services in the community. If in fact the rate of increase in wages is easing back, given the fact that we are not reducing outlays anywhere near as appreciably as we did, it would suggest that departments have more money to spend in real terms and that those departments have not had any significant cuts in their appropriations. In fact as a proportion of gross domestic product the expenditure available to them is greater. One such department is the Department of Defence. From my recollection, Defence expenditure was to be about 2.8 per cent of GDP this year. I expect that it will be much closer to 3 per cent. Certainly it will be above 2.8 per cent because of the movements which I have mentioned.

There is another aspect of this matter which I want to discuss and it concerns the actual level of the deficit. I regard it as quite important. According to the Treasurer, the deficit will be shown to be about $4,200m by the end of the year when the figures are balanced out. As I mentioned, there will be a reduction because about $ 1,000m of company tax collections is still outstanding. If we look at the monthly statement of financial transactions of the Australian Government we see that for gross pay-as-you-earn income tax collections from individuals the total for the 9 months to the end of March this year exceed $6,000m. Honourable members may say that that is a lot. It certainly is, but it is only 60 per cent of the total projected gross collections at the time we put the Budget together. If we use as a very rough guideline- there is nothing better than that- the proportion of collections for the same time last year it would suggest that we are very substantially down. We are down by about $ 1,400m on what we had anticipated when we put our projections together.

Let us do a bit of simple arithmetic. Let us take $ 1,400m from $4,200m-take the shortfall in income tax collections away from the deficit about which the Treasurer is talking- and we come down to $2,800m, which is about the figure we had set as the sort of deficit at which we were aiming. Let us look at another aspect of the nonsense that is implicit in the discussion about the Budget. About $700m of that is to be paid overseas and this has no influence at all in terms of domestic economic management. I come to an important point which I raised with the Treasurer today at question time. It is quite clear that he did not understand it. He had not heard of the concept before. I am referring to the full employment deficit. What is it? It is a relatively simple thing for a sophisticated organisation like the Department of the Treasury, with the people it has available to do such an exercise. It is done regularly in the United States of America and it is done in other countries. They use trend projections and so on to work out what would be the deficit at a time of full employment, given a number of relevant assumptions, and they compare that with the actual deficit.

The sums I have just done will show what the situation will be like if we start carving away some of the extraneous and not terribly relevant political rhetoric that is going on at the present time. I assert with a great deal of confidence that if a full employment deficit were projected for the present time the fears that people have would disappear. In fact they would be experiencing fears at the thought that a government in office is talking, at a time of extremely slack economic activity, of cutting back further on the deficit if it possibly can. That is sheer nonsense. It is the level of government expenditure at the present time which is maintaining the rate of activity existing in the economy. Without that public expenditure the private sector would be in serious trouble.

Let me move on to something else that has been said here in recent times. I refer to the Treasurer’s comments that we are moving into a recovery. He seems to be giving encouragement and saying that the light is at the end of the tunnel and that it is not a very long tunnel. For what it is worth, I do not think that this country will see any significant recovery before the end of the next calendar year. I assert that unemployment will rise and that economic activity at best will be extremely sluggish. It will not surprise me in the least to see unemployment reaching about 6 per cent. It will certainly pierce through the level of 5 per cent. That is the implication of the sort of economic management which the Government is applying at the present time. When the Government talks about an economic recovery starting from a base with an annual inflation rate in excess of 13 per cent, I wonder what it is trying to sell to the Australian people. How can anyone seriously believe, after the March quarter consumer price index figure showing an increase of 3 per cent, that there have been any encouraging inroads into inflation? I know that it is a lower rate than we saw in the December quarter. In the December quarter the figure was 5.6 per cent, but much more than 2 per cent of that was attributable to various forms of indirect tax charges. The previous Government levied them. The State governments levied them. They were preferable to printing more money and putting it into circulation when weighed against the problems we faced in handling the economy. So, excluding that, the rate of inflation in the December quarter was a little over 3 per cent. If one excludes the usual seasonal factors associated with clothing in that quarter and makes an allowance for the fact that there was a substantial increase in respect of potatoes alone, and then contrasts that with the March quarter when in fact the price of potatoes- a volatile input in the CPI statistics- went down, one sees that the result in the March quarter was far from encouraging. By and large, on the long term trend the March quarter figure is the best figure over the course of a year. Retail sales showed some sort of encouraging response, if one looks superficially at the latest statistics. In the Australian Financial Review of 5 May, confirming my own impressions from my dealings with business people, Chanticleer wrote:

While there is cheering among Canberra politicians and in other places about the retail sales figures for the March quarter, the retailers themselves and many manufacturers regarded them as disturbing.

For when they are adjusted to constant 1968-69 dollars, the sales (seasonally adjusted) showed a decline and were at their lowest level for a year.

In fairness, I should mention that he went on to suggest that there is some evidence of some little strengthening in April. But there is a long way to go yet: I stand by my prediction about the sluggishness of the economy well into 1977 and, I believe, well towards the end of 1977. The economic measures to which the Government has resorted in a clumsy, frequently erratic manner are not the appropriate economic measures to have been applied in this country, given the nature of the economic difficulties which we faced. I have given a rough outline of the way in which I have seen the economy, the way in which the Government’s policies have not been helpful and the very disturbing and unhelpful misrepresentation for which the Government has been responsible on the issue of the deficit.

I conclude by saying that Australia probably faces the most critical economic situation it has faced since the Great Depression of the 1930s. It looks as though this country will still be in a stagnant state of economic activity, epitomised by high rates of inflation, heightened industrial unrest and high unemployment, at a time when other countries have pretty much got on top of these sorts of problems. The shame is that when we went out of office we had the economy pointed in the right direction and starting to move, and all that has been lost.

Mr Wentworth:

- Mr Deputy Speaker, by the indulgence of the House, may I please address a question to the honourable member for Oxley?

Mr DEPUTY SPEAKER (Mr Martin:
BANKS, NEW SOUTH WALES

– Order!

Mr Wentworth:

– I am asking for the indulgence of the House, Sir.

Mr DEPUTY SPEAKER:

-Is leave granted?

Mr Scholes:

– He is completely out of order.

Mr Wentworth:

– I am in order in asking for the indulgence of the House, as the honourable member knows perfectly well. It seems to me that the honourable member for Oxley made an elementary mistake -

Mr DEPUTY SPEAKER:

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

Mr Wentworth:

– I am asking for the indulgence of the House, Sir.

Mr DEPUTY SPEAKER:

-Order! I am asking whether leave is granted.

Mr Scholes:
Mr Hayden:

-It is all right by me; I do not mind -

Mr DEPUTY SPEAKER:

-Order! Is leave granted?

Mr Hayden:

-As long as I can reply and as long as he says that he will not take long -

Mr DEPUTY SPEAKER:

-Order! Leave cannot be granted conditionally. Is leave granted?

Mr Hayden:

– Not unless I can reply.

Mr DEPUTY SPEAKER:

– Leave is not granted.

Mr BRAITHWAITE:
Dawson

– I rise to support these 2 Appropriation Bills. I wish I had the wit of the honourable member for Mackellar (Mr Wentworth), so that I could reply on his behalf. In rising to support the Appropriation Bills, I congratulate the Treasurer (Mr Lynch), the Cabinet and the Government on their determination to cut the extravagance of expenditure and the wastefulness of expenditure that have been evident over the last few years. To carry out an evaluation of the success of this determination one has only to look back to a similar period last year and compare the appropriations at that stage with the appropriations we intend to make this year and then compare the savings. The basic difference is that, whereas last year over $ 1 billion was being asked to be appropriated, this year the amount proposed is a net $28m. It has been the concern of this Government that the first priority must be the reining in of the expenditure that was running rife up to half-way through last year. I believe that these Appropriation Bills will stand as evidence of the success of the Government’s determination of priorities in this direction.

Before I continue I should like to mention 2 matters that were raised earlier in this debateone by the honourable member for Adelaide ( Mr Hurford). In his speech yesterday he said:

Australia is a great trading nation. We are affected enormously by the world-wide trade cycle. Our present troubles of inflation and unemployment to a large extent are the result of a world-wide trade cycle phenomenon.

I would have hoped that by now the Australian Labor Party would have learned that one cannot import into Australia a product whose seeds have been sown in one’s own environment. The seeds for the inflation we are experiencing at the moment were sown in the Labor support for the wage demands by the Public Service more than 2 years ago- demands that have flowed through to other trade unions in Australia. These demands have brought crippling cost to industry and have left inflation at the high rate at which it is today. The inflation may have been fanned by some world-wide influence, but the basic seed was sown by the Australian Labor Party itself in supporting those wage demands.

Secondly, the honourable member for Adelaide and also the honourable member for Oxley (Mr Hayden), who has just spoken, mentioned that the deficit has expanded because receipts have not been as they were expected to be as a result of the success of Labor’s wage policy. This approach seems to me to be like having a dollar each way and, irrespective of the result, taking the credit for what happens as something that had been achieved through one’s policy. I believe that this in itself is an indication that the Hayden Budget was nothing more than a hoax. It was a hoax in that the deficit was deliberately misrepresented as being low and comments were made at the time that the new rebate system of taxation would benefit middle class income earners. The only beneficiary from the rebate system of taxation of that Budget was the Government itself, through the collection of higher taxes. So I think we must look at those 2 aspects and try to put at rest the fallacies. Inflation was not imported. The Budget .which we are discussing at the moment and to which we are adding appropriations was nothing but a gigantic hoax foisted on the Australian public.

I believe that revenue that the Commonwealth collects is held in trust- a trust that is sacred as far as the taxpaying public is concerned. It is our duty as a government to maintain that trust. We should allocate expenses according to the priorities expected by the people who pay the taxes. These basically fall into 3 broad regions. Firstly, there are the acceptable services that people come to expect from a Federal government and that cannot be provided otherwise. Secondly, there is the priority to provide incentives to put money back into the productive areas to make sure that they remain viable and profitable and as a result can contribute taxes into the general revenue. I believe that this is an important area. Thirdly, there is the giving of assistance to those people throughout the Commonwealth who cannot afford to help themselves, who are in a situation not of their own choosing and who need support.

Over the last few years we have seen this assistance extended to people who could help themselves but never bothered to do so. That contributed a fair amount to the deficit we are discussing at the moment. But, more importantly, there are people who need assistance, people who in the past contributed greatly to Federal revenues and who need assistance at this moment. I mention the people in the beef, dairy and fruit industries spread throughout the Commonwealth who desperately need help at this stage. It should be part of our charter as a government to assist these people as far as we can, to last the distance until they get back to viable times. This trust that I mentioned is paramount. If we disenchant people by the way we handle their tax receipts, they will retaliate through the ballot box. I think we saw this evidenced on 13 December. The Labor Party lost that trust and the retaliation was complete, in that it lost government. But it is not fanenough for us in this House any longer- we have been doing this for 5 months- to try to create our reputation by mentioning that the Labor Party was a bad manager of the economy. We as a government must create our own reputation as managers of the economy. That is what we will be judged on in 2Vi years’ time. We will be judged not on our handling of the legacy left by the Australian Labor Party but on the reputation that we establish for ourselves as good money managers. In this regard I come back again to the fact that the Treasurer, the Cabinet and the Government are to be congratulated for starting us back on the road to respectability within the Commonwealth sphere and for bringing to an end an age in which there was a handout mentality and where people were expecting to receive but not give in return. I see these Appropriation Bills as being a definite start in this direction.

There are 2 other matters that I would like to raise which have some bearing on finances and the budgetary situation. One was mentioned yesterday at question time, the coal export levy. The Situation in respect of the Appropriation Bills that we are now discussing would have been $70m worse off but for the imposition of the coal export duty. That is the amount that was collected by the Commonwealth from that duty up to 3 1 March. Never before in the history of this Commonwealth has there been a duty that was designed to tax incentive- not to give incentive, but to tax incentive. It is a duty designed to cripple an industry that was viable and prosperous and that was prepared to help itself. There never has been a duty like this one, which was designed to stifle development in the area from which the tax is paid.

I hope that the Government will be able to see its way clear to return in some way to the mining towns throughout Australia the $70m that has been collected from the export levy in order to give them the basic facilities and the assistance that they cannot give themselves in the form of telecommunications services and translator stations as well as provide assistance to those adjoining beef areas that I mentioned before. I believe that the best incentive that we as a Government can now give to the coal industry from the point of view of those who are producing at the moment, those who are expected to develop the rich coal basins that exist throughout Australia, would be removal of this duty in the 1976-77 Budget. That would be little enough to give them, but it would be incentive enough for them to get back into full production and to develop those fields which could be the cure-all for Australia’s exports in the next four or five years.

The second matter that I mention is the matter of the zone allowance. This again affects many of the isolated mining townships and the other developing industries throughout the length and breadth of Australia. Yesterday, as a matter of public importance, the Labor Party brought on a debate about decentralisation in the sense of trying to take people from the capital cities to adjoining lands. Within the zone allowance we have a mechanism available to us, if we use it properly, for decentralising people and for making sure that they are encouraged to seek employment beyond the limits of the capital cities. If one examines the record of the zone allowance one will see that governments since 1945 have paid little regard to this aspect.

The zone allowance was initially introduced as an encouragement to people to seek employment in remote districts. The boundaries of the zones were first determined after a survey which took into account such factors as the uncongenial climatic conditions, the isolation, the loss of social amenities and the higher cost of living. In the land mass above the north of the Tropic of Capricorn, which encompasses approximately but not quite 45 per cent of Australia’s land surface, lives a minimal population. We could not even defend that portion of Australia if we were called upon to do so. The boundaries of the zone allowance have not been reviewed in the last 31 years, except for the differences between Zone A and Zone B. I believe that if we reviewed those boundaries to take into account the isolation experienced by the people in these communities who are striving to bring productivity to our northern lands we could encourage people to go out into these regions to seek employment and thereby assist Australia in so many ways.

We should review the boundaries. But, just as importantly, if we are to give any sting to this allowance, we should for goodness sake see whether we can apply proper values in respect of it. I take an example of zone B. In 1945 the deduction was worth $40. Now, 31 years later, it is worth $90. Under a rebate system it is worth $36 for every single person living within that area. That would not pay for a trip to the coast, let alone the other high costs which people are expected to absorb in this area.

Mr Lusher:

– It would not pay for a telephone call to Canberra.

Mr BRAITHWAITE:

– It would not. But they do not have telephones, in any case. In giving my full support to these Appropriation Bills and to the Government I ask for the support of the Government for these 2 basic items, namely, the zone allowance and the matter of the coal export duty.

Mr E G Whitlam:
Leader of the Opposition · WERRIWA, NEW SOUTH WALES · ALP

– I address myself to a matter which the honourable member for Hotham (Mr Chipp) raised in the debate on this

Bill last night and which the Prime Minister (Mr Malcolm Fraser) sought questions upon yesterday afternoon. Honourable senators also raised the matter during the adjournment debate last night. The Paltridge affair illustrates the double standards of the Government and the nauseating hypocrisy of the Prime Minister in particular. A serious allegation has been made against a former Liberal Party Minister. When allegations were made recently against Labor Party Ministers the Government showed remarkable speed and diligence in its investigations. It went so far as to use Commonwealth Police to interrogate the Australian Labor Party’s advertising agency and to check my movements as Leader of the Opposition. What happens when allegations are made against a former Liberal Minister? The Government resorts to remarkable delay and evasion. It fails to investigate the matter at home or to seek material abroad. If it is really concerned to clear Senator Paltridge ‘s name, why has it taken no steps to establish the facts? If Senator Paltridge was still alive the Government would have been no less dilatory and evasive.

These allegations are not new. I raised them in 1962. They have been raised again now for a very substantial reason- the recent evidence in the United States about the activities of the Lockheed Aircraft Corporation. What seemed in 1962 a possible explanation for certain actions by a Liberal Minister seems, in 1976, as a result of disclosures in the United States, a likely explanation. In 1962 the public would have been sceptical or incredulous about suggestions of bribes by multinational companies. Not now! The Liberals ask us to believe that what is known to have happened in other countries could never happen in Australia. It is evident from the questions I have asked that I was acting on information supplied to me. I do not need to establish the principle that a member of Parliament, especially an Opposition Leader, is entitled to raise information given to him in good faith. I repeat: A member of the Australian National Airlines Commission told me in late 1961 that the Minister for Civil Aviation had received from Lockheed agents the amount of their commission on one Electra aircraft in return for the part he had played in securing the orders for and importation of 1 3 aircraft instead of two of those aircraft.

I accepted the good faith of my informant. I trusted him. I believed what he told me. I still believe it. I add that at no time have I asserted that the Minister accepted the payment for his personal gain. It is altogether possible that the payment passed to the Liberal Party’s funds. It was precisely in the context of electoral fund raising that I raised this matter in the Parliament on 8 April. It is noteworthy that no one on the Government side objected or protested when the issue was put in those terms. Perhaps my accusations seemed more credible in view of the sworn disclosures, never challenged in the House, about fund raising activities in London on behalf of the Liberal Party by Mr John Keegan in the 1950s. In the debate on the Electoral Bill introduced by the honourable member for Port Adelaide ( Mr Young) I said:

In the later 1950s a Liberal Minister for Civil Aviation is believed to have received a very large sum for himself or his Party in consideration of orders for Electra aircraft which he had permitted and promoted. The sum is said to have been the commission on one of the 1 3 Electras ordered.

Later in that speech I used the term ‘Partridge affair’. I gave my information to the House and named the Minister 4 weeks ago. I invite the House to compare the information I gave 4 weeks ago with the information I sought when I first received it. I repeat: I received the information in late 1961 after Parliament had risen. The new Parliament sat for the first time on 20 February 1962. The next day I put a question on the notice paper, question No. 5, to the Minister representing the Minister for Civil Aviation. This is the question:

  1. Is the importation of aircraft prohibited unless the importer has the permission of the Director-General of Civil Aviation?
  2. On what dates did Ansett-ANA, Trans-Australian Airlines, Qantas and Tasman Empire Airways Limited receive permission to place orders for Electra aircraft?
  3. What was the cost of these orders?
  4. Who are the Australian agents for the manufacturers of Electra aircraft?
  5. What is the rate or amount of commission paid to the agents by the manufacturers on the sale of Electra aircraft?
  6. Where and when did the agents confer with him, the Director-General, Trans-Australian Airlines, Qantas and Tasman Empire Airways Limited?

The whole basis of every one of these questions was the information I gave the Foreign Minister (Mr Peacock) on 31 March this year, and the House four weeks ago and one week ago. The basic facts are these: In the late 1950s the Lockheed Aircraft Corporation received orders for 2 Electras from Ansett-ANA. In time this application for 2 Electras resulted in orders for thirteen. TAA had to take three, Ansett three, Qantas four and TEAL three. It was this remarkable increase in orders for an aircraft which no one except Ansett originally wanted, and which only the Minister for Civil Aviation could allow to be imported, which caused speculation and, inevitably, suspicion at the time. The Opposition was not alone in remarking on it. Let me quote, as I did a week ago, what Mr David Fairbairn said on 8 April 1959:

Let us see how the Government of this country has prevented the purchase of aircraft which the technical experts wanted bought, and which are made in the sterling area. First, we have the case of the Caravelle which was mentioned by the honourable member for Fremantle (Mr Beazley). TAA sent its experts, including Mr Warren McDonald, all round the world to look at every possible suitable aircraft and decided which was best. Among other places they visited Toulouse. As the honourable member for Fremantle said, they recommended the purchase of the best and most economical aircraft. So TAA decided to buy 2 Caravelles but was told by the Government that it could not do so. Eventually the Government said: ‘You can buy Electras.’

Mr Fairbairn proceeded:

The second case . . . is the rejection by the Government of the request by Tasman Empire Airways Limited for approval to purchase Comet aircraft. There is a board of six directing TEAL and its representatives spent 2 years visiting every firm in the world which turns out suitable aircraft. They inspected the aircraft, gave them test flights and eventually decided by a four-to-two majority in favour of the Comets. What did this Government do? It immediately sent the Director-General of Civil Aviation and the Minister for Civil Aviation to New Zealand and put the utmost pressure on the New Zealand Government and the board of TEAL to rescind that vote and not to buy Comets, but to purchase Electras instead.

On 19 February 1959 Mr Fairbairn had said:

I had the opportunity, while in America, England and France, of visiting a number of aircraft factories. I went to the Lockheed works at Atlanta, the De Havilland works at Bristol and the Sud works at Toulouse. I must say quite bluntly that, although I disagreed with the Government’s policy on aircraft buying before I went abroad, I have come back disagreeing with it even more strongly.

Mr Stanley Brogden, the eminent authority on aviation, said in his book Australia’s Two Airline Policy published in 1968 that the decision on Electras had postponed for many years the modernisation of Australia’s airline industry. He said the story of the way Lockheed sold the Electra to Qantas would one day be told as a ‘masterpiece of salesmanship.’

Mr Brogden said:

Convinced of the economic superiority of the Caravelle, TAA booked 2 places on the Sud-Aviation production line, the booking being subjected to ratification of an order by the Commonwealth. Did TAA really order the Caravelle? This is often debated, particularly as Liberal Party politicians are even today very touchy on this subject. . .

TAA management placed the entire proposals before the commission and saw it accepted, but the Commission’s proposals to the Cabinet were 3 times rejected.

Mr Brogden believed that TAA’s original preference for the Caravelle was justified. He continued:

The Qantas preference for the prop-jet was forced upon the New Zealanders, who actually flew a flag at half-mast at TEAL headquarters when the official decision was taken that TEAL should have the same equipment us Qantas . . . The decision was important in relation to its effect on the domestic situation: The Government now had two of its three main airlines preferring the Electra.

The mystery of the Lockheed orders might have remained in limbo if it had not been for the report this year by the sub-committee on Multinational Corporations of the United States Senate Committee on Foreign Relations. The report revealed that Lockheed had been associated with corrupt practices in a number of countries. On 18 February, at the first question time this year, the honourable member for Fremantle by now the father of the Parliament, asked the Prime Minister (Mr Malcolm Fraser) this question:

In view of the fact that the Lockheed Corporation is revealed as a major source of this sort of corrupt action, will the Prime Minister cause an investigation to be made into its activities in Australia where it has been the major supplier to civil airlines and defence forces?

The Prime Minister replied:

The latter part of that question might well involve the previous Administration. There would probably need to be some assurance from the Leader of the Opposition in relation to some aspects of it

In that very first question time the Prime Minister set the style of all his subsequent answersevasive, uninformative, sneering and supercilious. Six days later my previous Minister for Transport, the honourable member for Newcastle (Mr Charles Jones), asked the Prime Minister this question:

Now that it is an accepted fact that Lockheed Aircraft Corporation has paid bribes totalling millions of dollars to government ministers and commercial leaders in return for the purchase of Lockheed products is the honourable gentleman aware that when the domestic airlines were considering the purchase of new mainline aircraft in the late 1930s Trans-Australia Airlines recommended the French Caravelle and Ansett Airlines of Australia recommended the Lockheed Electra? Was it generally accepted at that time that Ansett Airlines of Australia received much more favourable treatment than TAA did. Is he also aware of the strong rumours at that time that a senior Liberal Cabinet Minister had been compensated by Lockheed following the government’s decision-

To which the Prime Minister replied:

The honourable gentleman was Minister for Transport and as Minister for Transport he himself might have had quite close liaison and communication with the Lockheed Corporation. … I think it ought to be noted that the honourable gentleman may well need to look to his own house first because he may not be aware that one of the various defence Ministers, or was it the Prime Minister at the time, was responsible for ordering Lockheed aircraft in the period of the previous Administration.

My Government ordered no civil aircraft from Lockheed. The only orders we placed for defence aircraft were for 8 Orions that were later versions of aircraft which had been ordered successfully and properly by the previous governments. Yesterday the Prime Minister unburdened himself of this self-righteous injunction:

One might have expected . . . that somebody who purports to be in a responsible position would not idly make this kind of accusation . . .

He was the one who first made accusations in answer to questions raised on the first sitting day by the father of the Parliament and raised 6 days later by the former Minister for Transport. Other members of the Opposition were pursuing this matter. On 18 February, the first question daythe day that the honourable member for Fremantle asked his question of the Prime Minister- the shadow Minister for Transport, the honourable member for Shortland (Mr Morris) wrote directly to the Chairman of the United States Sub-Committee, Senator Frank Church. Senator Church replied that the request should be addressed through the Department of Foreign Affairs. I wrote to the Minister for Foreign Affairs (Mr Peacock) on 31 March outlining the facts and asking him to make a request to Senator Church to provide the files which could be made available on a request by the Department of Foreign Affairs. I ask that the letter be incorporated in Hansard, Mr Deputy Speaker.

Mr DEPUTY SPEAKER (Mr Armitage:
CHIFLEY, NEW SOUTH WALES

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

Leader of the Opposition. 31 March 1976

My dear Minister,

Some of my colleagues have sought information from Senator Frank Church, the Chairman of the Sub-Committee on Multinational Corporations of the United States Senate Committee on Foreign Relations, concerning the sale of Lockheed Electra aircraft to Australia. Senator Church has replied: ‘The Subcommittee on Multinational Corporations has decided to make its files available pursuant to formal government requests transmitted to the United States through our State Department. ‘Should you wish the Australian information, the proper procedure would be to address a request through your foreign office. We will be pleased to respond as soon as possible.’

In the late 1950s TAA sought permission to import two Caravelle aircraft and Ansett-ANA to import two Electra aircraft. At that time the Customs (Prohibited Imports) Regulations, Third Schedule, Item No. 1, prohibited the importation of aircraft unless ‘The importer shall produce to the Collector the permission in writing of the DirectorGeneral of Civil Aviation to import the goods’. The DirectorGeneral at first refused permission. Later both companies sought permission to import two Electras each. They received this permission on 22 May 1958. Meanwhile, on 26 March 1958, Qantas had received permission from the Director-General to import four Electras and later, on 16 November 1959 and 24 February 1960 respectively, AnsettANA and TAA received his permission to import a third Electra each. Tasman Empire Airways Limited, at that time jointly and equally owned by the New Zealand and Australian Governments, took delivery of three Electras at the same time as Qantas took its four.

A member of the Australian National Airlines Commission explained this transformation of a request for two Electras to orders for thirteen Electras by informing me that the Lockheed agents in Australia, E. L. Heymanson Company Pry Ltd, gave the then Minister for Civil Aviation the commission they had earned on one of the thirteen Electras whose sale the company had procured and the minister had permitted. This information was reflected in the question for which the minister supplied me with an answer on IS March 1962 (Hansard, page 938). My colleagues Mr Beazley and Mr Jones have now asked the Prime Minister questions without notice on 18 February 1976 (Hansard, page 32), and 24 February 1976 (Hansard, page 187) and my colleague Mr Morris has received answers to questions on notice from the Ministers for Defence and for Transport on 1 6 and 1 7 March 1976 (Hansard, pages 693 and 767).

We now ask your department to transmit through the United States State Department to the Church Committee a request for the relevant files.

Yours sincerely,

E.G. WHITLAM

Copies to: Honourable K. Beazley, Honourable C. K. Jones, Mr Peter Morris.

The Honourable Andrew Peacock, M.P., Minister for Foreign Affairs, Parliament House, CANBERRA, A.C.T., 2600.

Mr E G WHITLAM:
WERRIWA, NEW SOUTH WALES · ALP

– I thank the House. After waiting a month without receiving even an acknowledgement of my letter I raised the matter again in the House a week ago after telling the Foreign Minister I proposed to do so. The Minister refused to take action. What possible justification can there be for the Minister’s refusal to co-operate? If he had wanted more information or further assurances from me he could have written back to me. He chose to ignore my letter. I tried to establish yesterday whether he had shown it to the Prime Minister. I asked the latter:

Did he see the letter which I sent to the Foreign Minister on 31 March concerning the Lockheed Electra purchases under Senator Paltridge before I quoted from the letter last Thursday? If he did, how long before did he see it?

I received this reply:

If the honourable gentleman will indicate the relevance of his question I will answer it.

I would have thought the relevance was obvious. So serious a matter could easily have been checked with the Prime Minister. Did the Foreign Minister raise it with the Prime Minister or did he keep it from him? Did he treat it with secrecy or did they both treat the subject with disdain?

If the Church revelations had appeared while I was Prime Minister I would have had the Australian position investigated. If as a Minister I had received a request from the Leader of the

Opposition, such as the Foreign Minister received from me on 3 1 March, I believe I would have acted promptly, directly and courteously. I do not believe I would have responded by casting snide aspersions on members who had asked questions. The Prime Minister and the Foreign Minister can easily establish whether the Church Committee has any information. It may be that the Committee has no relevant information. It may be that the Committee would be disposed to resume its investigations. Unless the Government takes action no one will know whether the Church Committee has information or not. The longer the delay in approaching the Church Committee the less likely it is that the Committee will resume its inquiries. The more the Government stalls and blusters and covers up the more likely people are to believe the worst, and the more they will be justified in doing so.

Mr SPEAKER:

– I call the honourable member for Braddon. I remind the House that this is the honourable gentleman’s maiden speech.

Mr GROOM:
Braddon

-I regret, Sir, that it is necessary for me in my maiden speech to follow a man who has just made a scurrilous speech which has debased this House and the standing of this House. It was a mean and despicable act against a dead man. I appreciate my responsibility in making my maiden speech that I must not be unduly provocative, but I am afraid I must say that this speech has disappointed me. This attack on a dead man- a man whom I did not know- has caused great distress to his family, to his dependants and to his loved ones. It is most unfair, despicable and unAustralian that the Leader of the Opposition (Mr E. G. Whitlam) should now seek to attack this man in this way. The principle is clear. This man is dead. He cannot defend himself, and the Leader of the Opposition knows this. Where is the Leader of the Opposition’s evidence? Where is the evidence to prove the point that he now makes? The matter is splashed over the headlines of all of our newspapers. He relies on an unnamed source and an unnamed person. Let him name that person. Let him name that source. Let him produce some evidence and then, with respect to him, we may think a little more of him.

Let me now pass to perhaps a brighter subject. It is with a great sense of honour that I stand here in this chamber as the representative of a great electorate, the electorate of Braddon in Tasmania. I wish at this point in my speech to thank my constituents from all over Braddon who gave me wonderful support in the last election and who have given me the opportunity and the responsibility I now carry. I mention specifically the people of Devonport and Ulverstone, the people of the small town of Penguin on the north-west coast of Tasmania, the people of my own home town of Burnie, the people of Wynyard, the people of Smithton and Stanley in the Circular Head area, the rugged west coasters from the west coast area of Tasmania which I know you, Mr Speaker, know quite well, and the people from King Island. I thank all of those people and I promise them that I will speak out for them as strongly as I possibly can in their interest.

I appreciate that I and other honourable members have an obligation in the national interest to look after the country, to protect the national interest and to put the country back on the right path again. But I am a Tasmanian and I am very proud of that fact. I say here and now that I will not shirk any issue which might be of concern or interest to my fellow Tasmanians. We have a young and vigorous team of Tasmanians in this chamber, and I am very proud indeed to make reference to them. I compliment them on the fine job they are doing for their constituents. Again, I will mention them expressly: The honourable member for Bass (Mr Newman), the Minister for Repatriation, who is at the table at the moment; the honourable member for Denison (Mr Hodgman); the honourable member for Franklin (Mr Goodluck); and the honourable member for Wilmot (Mr Burr). Together we represent a mere 3 per cent of the population of this nation but we intend to get more than our three cents worth for our constituents. It would be only proper for me to mention my predecessor, Mr Ron Davies. I do this quite sincerely because I believe he gave meritorious service to his electorate for 1 7 years. I am sure my constituents would like me to wish him a long and happy retirement.

The House is now dealing with two Appropriation Bills which seek the approval of this House for the appropriation to specific departments and services of an additional $506,201,000 over and above the amounts provided in Appropriation Act (No. 1 ) and Appropriation Act (No. 2) of 1975-76. 1 am delighted to be making my initial contribution in this debate on Supply legislation. Let us not understate the importance of this legislation. It is not merely formal legislation; it is not simply a matter of applying a rubber stamp. Before I go on to other matters, I should like to touch on the constitutional questions which have been raised, and which one could say have been done to death. The honourable member for Adelaide (Mr Hurford) and the honourable member for Melbourne Ports (Mr Crean) have laboured this theme for some time. The arguments are now historical, but I do not think it would be fair to say that it is sour grapes on their part. I recognise the emotional content of these issues, but surely those honourable members must realise, if they think about the matter, if they look at the Constitution, that their arguments lack any basis in law or in logic.

The vast majority of constitutional lawyers of any standing whatsoever in this country now recognise- not all of them recognised it beforethat the Senate has the power under section 52 of the Constitution to defer or reject Supply. After all, what better proof is there than that the power has now been exercised and exercised successfully. I remind the House and honourable members opposite that the Senate, and the power given to it under section 52, was fought for by Tasmania and the other smaller States and their representatives prior to Federation. I believe that they are a keystone to the Federal compact. I remind honourable members opposite of section 1 of the Constitution, to which I wish to refer:

The legislative power of the Commonwealth shall be vested in a Federal Parliament, which shall consist of the Queen, a Senate, and a House of Representatives, and which is herein-after called ‘The Parliament,’ or ‘The Parliament of the Commonwealth.’

It would appear that honourable members opposite do not recognise two-thirds of that definition of the Parliament. The honourable member for Adelaide in this very debate yesterday continued his attack on His Excellency the Governor-General, and I refer to the comments he made at page 1 945 of Hansard. He said:

If anyone thinks that the royal visit next year, if we still have the present Governor-General, will be a joyous occasion he had better think again.

Think about those words and ponder them for a moment. I suggest to the honourable member for Adelaide that he should refer to section 24A of the Crimes Act, which deals with the crime of sedition. I am not suggesting for one moment that the honourable member has committed that crime, but I would offer him the advice that perhaps before he makes further comments like that he should give consideration to that section. The honourable members to whom I have referred are pursuing their vendetta and causing bitterness and hatred within our community. Their comments and their attack, I believe, are politically naive. They are paying the price, and while they continue their attack they will continue to pay the price.

As I have said, the legislation with which we are now dealing is not merely formal legislation. Appropriation legislation goes to the very heart of government. Government is finance and finance is government. It behoves ail of us in this House to be deeply conscious of how the Government spends the people’s money. Governments do not spend Minister’s money. It is the hard earned money of people- the men and women who have toiled for many hours each week of their working lives to finance government. We must not be concerned simply with millions of dollars or with hundreds of thousands of dollars. We must be concerned with individual dollars and we must be concerned also with cents. I am reminded of the comment of the Minister for Defence (Mr Killen), as he now is, in my electorate during the last election campaign, when he said:

Each government must recognise and fulfil its duty as a trustee of the taxpayers’ money.

That is a most important principle. One of the fatal errors of the previous Labor Administration was its blatant breach of that duty and its gross negligence and carelessness in the manner in which it spent the people’s money. Now that we are in government we must not forget that point. It was a question of too much too often; a mental condition which could be fairly described, I believe, as the Blue Poles syndrome. The cause was a lack of discipline. Unless leaders discipline themselves and their policies, government cannot function efficiently; it cannot satisfy the needs and aspirations of the people. Fortunately- I say this quite objectively and non-politically- we now have a government which will not shirk its responsibility to the people, which has discipline and which accepts its duty of trusteeship.

The appropriations reveal substantial savings in a whole range of government expenditure. These must be applauded, and I believe will be applauded by the people. However, the Government must not be mesmerised by the need to save and to cut cloth. I am not suggesting that it is now so mesmerised, but it is necessary for us back benchers, us private members, to remain vigilant to ensure that the Government remains responsible, as it now is, in making its decisions. It must distinguish waste and excesses from true social need. Despite our budgetary deficit, this Government must be humane. Again I say that I offer no criticism. I believe that it is being humane. It must use its heart as well as its head. We must continue to be concerned for the aged, for the poor, for the mentally and physically handicapped, and for the less fortunate in our community and other communities in the world. We must distinguish the people in genuine need from the layabouts, the slackers and the work shy.

Let me turn from these universal issues to some grave problems which affect my own electorate of Braddon. I mention briefly that Braddon encompasses the top left-hand corner of Tasmania, from the Mersey Valley westward to the north-west tip of Tasmania and down to the point south of Macquarie Harbour on the west coast. It includes the important island of King Island. The electorate depends very largely upon private enterprise. The end product of lavish wasteful spending by the Labor Administration was a savage beating and bruising of the private sector. Even honourable members opposite would recognise that fact. I know that the honourable member for Oxley (Mr Hayden) did recognise that fact when he presented his Budget Speech last year. In my electorate we have farming, mining and manufacturing industries. All of these were affected adversely by Labor policy decisions during its period in office. The paper industry is a vital industry. I am pleased to say that, although it had a difficult time for some years and had to retrench hundreds of workers, things are now looking up. This is a vital industry in my electorate, and I am pleased that its situation is improving.

The Mount Lyell Mining and Railway Co. Ltd is one of Australia’s largest copper producers. Queenstown on the west coast, with its population of 5100 people, is almost totally dependent on the viability of this company. A combination of world copper prices and inflation brought this company almost to ruin. In the last financial year it made a trading loss of $8.2m. Again, there are some signs of recovery, with an increase in world copper prices. There are heartening indications for the people of the west coast.

I turn to primary industry. The north west coast of Tasmania and King Island contain rich and fertile agricultural land. It is ideal land for dairying, beef and vegetable growing. A good many of our farmers are facing total ruin. Their problems cannot be overstated. I know that my colleagues in the National Country Party and the Liberal Party appreciate that these problems exist, and I really believe that the Government appreciates that these problems exist. But I believe that a good many of our farmers are being exploited by other people within the community. I do not say that this is being done knowingly or deliberately. I can almost hear the groans from the urbenites. I would like to take some of these people from the large cities who are cynical about these problems around my electorate and introduce them to some of these farmers who are in such a desparate situation. Many of them are earning genuine incomes of only $2,000 to $3,000 a year, and there are no tax lurks. They are working 80 hours a week, often with unpaid family assistance. Of course, the cynics will ask: Why do they not get off the property and sell the land? In my electorate hundreds of properties are for sale but they cannot be sold because there are no buyers available. In any event, if the properties could be sold what would the farmers do? Many of them have no other work qualifications. There is no other work that they could do. There is little work available for them. In my opinion- 1 say this humbly because there is much more that I need to know about the problems facing these farmers- the real solution to their desparate plight will not be found in the payment of unemployment benefits or the provision of short term band aid assistance although, of course, this is essential and has my full support. Their future is dependant upon a gradual reorganising and restructuring of their industry. It is time to make a total and urgent reassessment of their desparate situation.

King Island has problems and dme does not permit me to go into them in detail. But I am conscious of the Island’s problems, particularly transport problems. I hope to have at an early date an opportunity to debate in greater detail for the benefit of honourable members the problems and issues confronting King Island. There is a need to encourage industry and private enterprise. For the Australian Labor Party ‘profit’ is a dirty word, but I believe- I feel that my colleagues also would believe- that profit is necessary so that a business can expand. When it expands it creates job opportunities. This means higher employment. Therefore, we must give encouragement to private enterprise. The words of Professor Milton Friedman are apt and relevant to this point:

The free enterprise system is the only system which will enable the ordinary man- the ordinary citizen- to have a maximum degree of both freedom and prosperity.

Mr Speaker, I am confident that the policies and initiatives of this Government will in time give Australians more freedom and a good deal more prosperity. May I, in conclusion, thank honourable members on both sides of the House for their kind reception. May I congratulate you, Mr Speaker, on the most capable manner in which you are conducting the deliberations of this chamber.

Mr INNES:
Melbourne

-Mr Speaker, I have made the point before that this Government in making its cuts in expenditure and savings is bent on attacking those in our society least able to protect themselves- the poor, the sick, the pre-school children and those dependent on social security benefits. The cats have also attacked the newcomers to our country- our ethnic communities. My assertions have been ridiculed by members of the Government but no longer will they do that for they are condemned by their own hand. The Treasury information paper dated 28 April 1976 sets out clearly and unequivocally the savings expected in the 2 Appropriation Bills being discussed.

Mr SPEAKER:

-Order! The honourable member will resume his seat. The honourable member for Braddon made an outstanding maiden speech but I ask honourable members to cease their congratulations and conversations so that the honourable member for Melbourne may be heard.

Mr INNES:

– I hope that that does not rob me of time either, Mr Speaker. The document proves conclusively that this Government has actively discriminated against ethnic communities. Indeed, two of the cuts cast serious doubts on Australia’s status as a signatory to the United Nations International Convention on the Elimination of all Forms of Racial Discrimination.

Before I discuss these cuts in detail let us examine what they are. The cuts are simply a cosmetic exercise. In no sense do they form part of a coherent economic strategy. They simply relate to the image of the Prime Minister (Mr Malcolm Fraser) as the strong man, the stern leader introducing belt-tightening measures. On the Government’s own admission the cuts total a mere $478.2m out of a total expenditure of something like $20,000m- a mere 2 per cent of total spending. They are not a sincere expression of economic policy; they are an exercise in hypocrisy.

It is revealing to see who this Government is prepared to sacrifice first in this image-making exercise. Who are they? During the election campaign we heard all sorts of promises from the Liberal Party and National Country Party coalition about a new deal for ethnic groups. It is now clear exactly what this new deal comprisesone of image-making, cosmetic exercises and a new name for the relevant Department. It is now the Department of Immigration and Ethnic Affairs. It has exactly the same staffing; exactly the same structures. The only change made has been to the letterhead of the Department. What has been the new deal? It is a series of vicious cuts that have affected nearly every single area of ethnic group concern. Our ethnic communities have been the first target of the new Government.

Let us look at the figures supplied in the Treasury information paper. Let us start right at the beginning of this infamous document and look at the cuts made in the Department of Administrative Services. Division 414 of the estimates for that Department relate to the Aus.tralian Office of Information. The cuts in the area of administrative services total $590,000. Of this money saved, $400,000 was earmarked for migrant publicity. The cuts in that area are a fine indication of the Government’s concern for ethnic groups. Out of the $590,000 cut from the estimates, $400,000- honourable members should keep that in mind- directly affects our ethnic communities. Let us look at what the money was for.

I venture to say that of all the Labor Government ‘s initiatives in the field of ethnic affairs one of the most enthusiastically welcomed initiatives was the introduction of access and ethnic radio because for the first time our ethnic groups had the opportunity to enjoy their own cultures on our air waves. It was a long overdue reform. After all, members of our ethnic groups make up approximately 25 per cent of our population. They pay their share of taxes and have a right to expect that at least part of the public broadcasting expenditure will be tailored to their needs. What was the new Government’s response? Out of the $400,000 earmarked for migrant publicity through the Australian Information Office $150,000 was to be spent on aspects of ethnic broadcasting. That has gone, every cent of it, and with it I fear has gone the future of ethnic broadcasting in this country.

What of the other cuts? They relate to publications in major languages, publications explaining the complexities of our hire purchase and credit finance procedures, publications warning of the dangers of swimming on our beaches. I am sure that I do not have to remind honourable members of this House of the number of tragic drownings of the children of migrant parents who are not acquainted with the basic safety precautions that are second nature to most Australian-born Australians. The other area affected by the cutback was literature for prospective migrants.

Let me continue through the document. I come to the cuts in the Attorney-General’s Department and deal with division 175- the Australian Legal Aid Office. Amongst the groups for whom the Australian Legal Aid Office assumed special responsibility migrants figured prominently. Included in the charter of the Legal Aid offices was a special responsibility to protect migrants who are in many cases unfamiliar with our complex legal system. The cut in the legal aid area is $2,496,400. This cut will seriously affect the capacity of the legal aid offices to protect members of our ethnic communities from exploitation and injustice. Indeed, it has been suggested by lawyers involved in the service that the Government is deliberately starving the legal aid offices out of existence. Once again our ethnic groups will be amongst the first to suffer.

I move on to the cuts in the Department of Education. We find once again that ethnic groups are the first victims of the cuts. The largest single cut in the education budget- let me emphasise that point; the largest single cut- is in the area of the child migrant program, a cut of $983,400. It is easy to see where this Government’s priorities lie. Almost $lm has been trimmed off the child migrant education program. This cut is closely followed by that to the adult migrant education program in Australia, including part-time instruction. There the amount is $419,000. It was the Labor Government that recognised that members of our ethnic communities were more than just factory fodder. It is the new Liberal-National Country Party Government that is bent on discriminating against migrant children and adult migrant workers seeking to improve their standard of education.

Another important cutback is in the grants to the Schools Commission. In the area of special investigations, an area vital for the development of multi-lingual and multi-cultural education programs, the cut has been equally vicious. Out of a total budget of $404,000 the amount of $167,000 has been removed. This cut will seriously jeopardise research aimed at meeting the needs of ethnic groups in education. In the area of technical education the cutback for research and investigations has been equally vicious. Almost a quarter of the total budget, $50,000 out of $219,000, has been cut. In another area, assistance for post-graduate studies in social work- this is an area that directly affects children in disadvantaged schools, and that in large part means migrant childrenthis Government has cut $58,000 off a total allocation of $2 19,000. Pre-school teacher education allowances, another vital area of ethnic group concern, has suffered a cutback of $363,000. In the area of pre-embarkation and shipboard instruction for migrants coming to this country a further cut of $30,000 occurs. It is easy to see where this Government’s priorities lie. It is not hard to gauge the real level of concern for our ethnic communities.

Let me take as another example the budget of the Department of Employment and Industrial Relations. The cut in the appropriation for ‘Committees on Discrimination in Employment’ is almost half of the total-$24,000 out of $50,000. 1 turn to the national employment and retraining scheme which was specifically designed to meet the retraining needs of members of our whole community in general, and in particular our ethnic communities. The cut in that area is $5,100,000. The reduction is made in the allowances payable. That reduction has made the scheme an unworkable farce. I turn next to the cut with respect to Commonwealth Hostels Ltd. It is a total of $43,000 out of an allocation of $195,000 for migrant temporary accommodation assistance.

I instance next the cuts in the budget of the Children’s Commission. This is one area that probably affects our ethnic communities more than any other. Indeed, some ethnic communities have been sending their children to their home countries for want of adequate child care services in this country. What is the cut? It is the entire allocation. The appropriation is $6,47 1 ,000 and the cut is exactly that amount.

I turn to the cuts in the budget of Department of Social Security. The allocation for the telephone interpreter service has been cut by $46,000. This is a cut that has meant that at the time when the translating service is most needed it is just not available. More than a quarter of the money allocated for the Migrant Social Welfare Advisory Council-$4,000 out of $14,000-has been cut. Grants to organisations for welfare rights services have been cut by one-fifth. The list goes on. A cut of $127,000 is to be made in the allocation of $437,000 for research on special projects for the Social Welfare Commission. For the first time, through this body, ethnic groups were being investigated and plans were being drawn up for the purpose of protecting migrants as such.

I have already drawn attention to the plight of ethnic radio. The allocation to the AttorneyGeneral’s Department of $58,400 for ethnic broadcasting equipment is to be cut by $24,000- nearly half the total allocated. How long can ethnic broadcasting continue if the Government deliberately starves it of funds? Under consumer protection, another area that vitally concerns ethnic communities, we find another cut- of $840,000 out of a total of $1,120,000. So it goes on. Proceeding through the document we find a further cut in the budget for the Children’s Commission. The allocation was $57,537,000 and the cut is just that-$57,537,000. I have already stressed the importance of child care in our community and I do not need to do so again.

I referred earlier to the fact that the cuts cast serious doubts on whether we have fulfilled our obligations under the United Nations International Convention on the Elimination of All Forms of Racial Discrimination. We became party to this Convention with the passing of the Racial Discrimination Act of 1975. Amongst the provisions of the Act was the establishment of a Community Relations Council. So important was the Council considered that it was afforded a separate section- Part V- in the Act. The appropriation for the Council was $ 14,000. The cut made by the Government was precisely that. In other words, the new Government has effectively prevented the full expression of the Racial Discrimination Act and has rendered impossible one of the key provisions of the Act. If this Government is not prepared to allow the Council to be established, I ask the Minister whether he will give effect to article 14 ( 1 ) of the Schedule of the International Convention on the Elimination of All Forms of Racial Discrimination. That article provides that a State Party may at any time declare that it recognises the competence of the United Nations Committee on the Elimination of Racial Discrimination to receive and consider communications from individuals or groups of individuals within its jurisdiction claiming to be victims of a violation by that State Party of any of the rights set forth in the Convention.

I believe that the refusal to finance the establishment of a community relations council to advise both the Attorney-General and the Commissioner for Community Relations concerning the observance and implementation of the Convention constitutes a violation. If this Government is not prepared to fund a council made up of representatives of our ethnic communities, to allow their views to be heard, will the Government allow their voice to be heard before the United Nations Committee? That is the question that ought to be answered by the AttorneyGeneral (Mr Ellicott) or the Minister for Immigration and Ethnic Affairs (Mr MacKellar). But in an even more fundamental way the present Government has breached the Convention, and that is in respect to article 7 of the Convention’s Schedule. This article clearly states:

States Parties undertake to adopt immediate and effective measures particularly in the fields of teaching, education, culture and information with a view to combating prejudices which lead to racial discrimination and to promoting understanding, tolerance and friendship among nations and racial or ethnical groups, as well as to propagating the purposes and principles of the Charter of the United Nations, the Universal Declaration of Human Rights, the United Nations

Declaration on the Elimination of All Forms of Racial Discrimination, and this Convention.

What the Government has done in its Budget cutbacks is to make it quite impossible for the office of the Commissioner for Community Relations to carry out this vital education role. But before I outline the ways in which the cuts have had this effect, it is worth noting the views of the present Minister for Immigration and Ethnic Affairs when the Racial Discrimination Act was debated on 8 April 1975 and he was speaking for the then Opposition. He talked on 2 distinct types of discrimination. The Minister referred to deliberate and inadvertent discrimination. He had this to say:

Whilst the effect on the victim is manifestly the same, that discrimination which comes about by inadvertence implies no underlying hostility on the part of the discriminator. This is important because if discrimination comes about through inadvertence there are no underlying community attitudes which have to be changed. We find that once this kind of action is publicly identified, public opinion will tend to support the development of public awareness against such discriminatory attitudes.

Sitting suspended from 6 to 8 p.m.

Mr INNES:

-The Minister, as I pointed out, was careful to stress that the educational and punitive balance of the Act should be carefully observed and protected. I agree with that as a proposition. But what has been the actual record of this new Government in office, as distinct from the fine words spoken on the road to office? Actions speak louder than words and in this case the action was quite clear. There was an allocation of $184,000 for the office of the Commissioner for Community Relations. An amount of $59,000 has been cut from that allocation. This cut has totally negated the educational component of the Racial Discrimination Act. The office of the Commissioner for Community Relations is able to process only those very postevent cases that the present Minister, while in Opposition, correctly identified as playing a very small part in implementing the overall ideals of the Act.

In my opinion, this cut casts serious doubt upon whether we can be described as carrying out Article 7 of the United Nations Convention. Far from carefully observing and protecting the educational and punitive balance, this Government has totally removed the education role of the office. This Government is in clear breach of its duties under the United Nations Convention. In summing up, let me make one thing quite clear: The allocations originally provided for in these 2 Appropriation Bills were far from extravagant. The previous Treasurer, the present honourable member for Oxley, Mr Hayden, was a stern task master. The allocations for each government department were pared to an irreducible minimum. It was an extremely tough Budget at that time, one that did not leave any room for further economies. What was provided for was the bare minimum necessary to carry out the program ahead.

This is the key point: What this Government has done has not been to economise in any real sense of the word. What it has done has been to destroy. The cuts have dealt a crippling blow to all the programs I have outlined, a blow from which they are unlikely to recover. Certainly, given this Government’s record so far, it would be hopelessly naive to believe that any of these programs will fare any better in the Budget to be presented in August this year. These cuts have only opened the way for the total destruction of all these programs before the end of this year. The individual who is responsible for this the Prime Minister (Mr Malcolm Fraser)- has just entered the House. There is one thing that this Government has demonstrated in these cuts, namely, its utter contempt for the needs, aspirations and rights of our ethnic communities. Under the Australian Labor Party Government for the first time ethnic groups were given a fair go-

Mr Sullivan:

-What about the Turks?

Mr INNES:

– We were still a long way short of completing our program. There are a few Turks in Riverina who will deal with the honourable member. He will meet with the fate that his mates have met with in the New South Wales Parliament. We were still a long way short of completing our program when we were removed from office. But the program which encompassed every area of ethnic group participation in a proper and adequate sense in the Australian community has been disastrously cut by this Government. That program will be placed in a situation from which it will never recover. Yet we heard all this hot air from the Prime Minister about what his Government would do for ethnic groups. The Government has led them up the garden path. At least a start had been made by the Labor Government. Under this new Government we have seen a very sudden return to the policy of indifference and neglect that marked the 23 years of the LiberalNational Country Party misrule. This Government stands condemned for its breach of the United Nations Convention, not only before the people of this country, but before the people of the world.

Debate (on motion by Mr Graham) adjourned.

page 2052

QUESTION

TREATY OF FRIENDSHIP AND CO-OPERATION BETWEEN AUSTRALIA AND JAPAN

Ministerial Statement

Mr MALCOLM FRASER:
Prime Minister · Wannon · LP

- Mr Deputy Speaker, I ask for leave to make a statement.

Mr DEPUTY SPEAKER (Mr Lucock:

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

Mr MALCOLM FRASER:

-When this Government was elected to office last year Japan’s Prime Minister conveyed to us, as well as his congratulations, his desire that the basic Treaty of Friendship and Co-operation be brought to an early conclusion. The Government, sharing Prime Minister Miki’s desire, has given the highest priority to bringing to a successful conclusion the negotiations for the Treaty- negotiations that had laboured for 2V4 years. I can now inform the House that the negotiating officials have agreed on a draft text of the Treaty of Friendship and Co-operation. Both governments have been closely following the progress of negotiations. Issues have been referred by officials to their governments for decision as they arose. As of today, the outstanding issues of substance have been resolved. It may therefore be expected that the 2 governments will have little difficulty approving the draft. It can be expected that the Treaty will be signed by Prime Minister Miki and myself during my visit to Tokyo in the winter recess.

Strengthening and deepening the bonds between Australia and Japan is one of this Government’s foremost policy objectives. It is no accident that one of my first international visits- the first planned visit other than my visit to New Zealand- is to Japan and China. It is no accident that the Deputy Prime Minister (Mr Anthony) went to Japan very early this year to convey our view of the way in which relationships between Japan and Australia ought to develop. I believe we have already seen some advantages from that visit. Over the past 20 years economic relations between our 2 countries have expanded in magnitude and importance. Japan has become Australia’s largest trading partner. Australia is second only to the United States as an importer of Japanese goods. In the trade area, Liberal and National Country Party governments have long sought to extend Australia’s relations with Japan. In 1957 we took the major step of signing the Agreement of Commerce with Japan. Unfortunately that Agreement was not fully supported by all members of this House at the time. This

Agreement was of mutual value to the 2 countries, and it contributed to the present extent of Australian-Japanse trade and to goodwill between both nations.

In 1971 we established the Australia- Japan Ministerial Committee in recognition of the fundamental importance of economic relations between our countries. But trade relations, no matter how important and meaningful, are not and cannot be the totality of countries contacts with one another. In the case of Japan and Australia, a mutually profitable basis of economic exchange makes it even more important that there be an understanding by the 2 countries- an understanding of their peoples, their language, their culture and their traditions.

In furtherance of the objective of greater understanding, this Government re-introduced into Parliament the Bill to establish the Australia-Japan Foundation. The Foundation will promote the study by Australians and Japanese of the language, culture, social, economic and political institutions of one another’s countries. It will enrich Australian- Japanese relations, both by the understanding that knowledge can bring and, no less importantly, by the personal contacts between Australians and Japanese that the Foundation’s work makes possible.

The possibility of a broad treaty between Japan and Australia has a long history, being raised first in the 1950s and raised again in the 1970s. It was discussed at the first meeting of the Australia- Japan Ministerial Committee in 1 972. The Senate Standing Committee on Foreign Affairs and Defence reported in favour of a treaty framework in 1973. Later that year the then. Prime Minister proposed that negotiations for a treaty should begin. The present Government’s commitment to conclude successfully the Treaty of Friendship and Co-operation and Prime Minister Miki’s desire that it should be concluded, gave new impetus to negotiations which had been delayed during 1975. The result was today’s outcome.

As the draft of the Treaty is still confidential and formally subject to consideration and approval by the 2 governments- I emphasise the words ‘formally subject to consideration and approval’- it would not be appropriate for me at this stage to discuss it at length. The Treaty of Friendship and Co-operation is broad-ranging and covers virtually the whole relationship between Australia and Japan. It is designed to be an umbrella under which further agreements may be made and relations developed in specificareas. It accords significant reciprocal benefits.

The treaty will be a major step forward in our relations with Japan. It will set the stage for a new and even more cordial era in our dealings with the country which, in a generation, has become our main trading partner, and a cornerstone of stability in the region of which Australia is a part.

In the treaty the governments and the peoples of Australia and Japan have fashioned an instrument designed to help close those gaps in understanding which remain and to bring new progress and confidence in areas where friendship and co-operation are already established. It will lead to a relationship of greater intimacy. But the significance of the treaty lies not only in our relations with Japan. The great understanding and closer ties between the 2 countries on a wide range of fronts which the treaty makes possible will not only be of great mutual benefit; it will also benefit the countries of the west Pacific and strengthen forces for peace and security in the Asia-Pacific region.

In conclusion, I place on record the strong spirit of mutual accommodation which has made the treaty possible. That spirit augurs well for the century of the Pacific on which we, Japan and our neighbours are now embarking. I also pay tribute to the officials of both countries who have helped the governments of both countries bring this to a successful situation. I present the following paper:

Treaty of Friendship and Co-operation Between Australia and Japan- Ministerial Statement, 6 May 1976.

Motion (by Mr Sinclair) proposed:

That the House take note of the paper.

Debate (on motion by Mr Scholes) adjourned.

page 2053

QUESTION

OVERSEAS LOANS

Ministerial Statement

Mr ELLICOTT (WentworthAttorneyGeneral) I seek leave to make a statement.

Mr DEPUTY SPEAKER (Mr Lucock:

-Is leave granted?

Mr Uren:

– Does the Minister have a copy for us?

Mr ELLICOTT:
LP

– Yes, I will give the Opposition a copy.

Mr Scholes:

– We are a bit concerned. We hear about these matters on news bulletins. We are entitled to have some notice of them.

Mr ELLICOTT:

-I am seeking leave.

Mr Scholes:

– I realise the Minister is seeking leave. There are some courtesies which are followed in this House, and the Attorney-General should abide by them in the same way as everyone else.

Mr DEPUTY SPEAKER:

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

Mr ELLICOTT:

– For some months prior to November last year rumours had been circulated that Ministers of the Labor Government had been involved in improper dealings in relation to overseas loans. The then Opposition considered at the time that these rumours ought to be the subject of a check. While in Melbourne on 2 November for a meeting of Federal and State parliamentary leaders of the Liberal and National Country parties, the name of Wiley Fancher was mentioned to the Premier of Queensland as a person who was understood to have information in connection with these rumours. The Premier was asked if he would be prepared to have the matters referred to, investigated. He said he would. Once the change of government had occurred on 1 1 November, the caretaker Government adhered scrupulously to the undertaking given to Sir John Kerr that there would be no inquiries by the Government or its instrumentalities, or its employees, into the activities of the former Government.

Last year and early this year the Premier of Queensland, Mr Bjelke-Petersen, supplied to the Federal Government certain information which suggested that 2 Ministers of the Labor Government and a senior official still in the Commonwealth Public Service might have been involved in attempts to obtain for themselves kick-back commissions on proposed overseas loan borrowings by the Labor Government. The information included notarised statements and other documents which pointed to the possible existence overseas of a mandate signed by the Ministers, and of an associated document implicating the official, which mandate and associated document evidenced the attempts to obtain the kickbacks.

I conferred with the Premier of Queensland in Canberra on 15 January in the presence of the Secretary of my Department, the UnderSecretary of the Premier’s Department, Queensland. Also present were Professor O’Connell and Mr Fancher. Following that meeting, discussions took place which involved the Solicitor-General, the Secretary of the Attorney-General’s Department, the permanent head of the official’s department and the Chairman of the Public Service Board. As a result of these discussions and in conformity with the unanimous advice of officials it was decided that, since a senior public servant was implicated, the Government was bound to institute inquiries to ascertain whether there was any substance in the allegations. Thorough inquiries were then undertaken overseas by an officer of my Department. As a result of these inquiries I concluded that there was no substance in the suggestion that either the official or the 2 Ministers were involved in the wrongful conduct alleged, and the matter was reported by me to the Parliament in an answer to a question which will be found at page 780 of Hansard of 18 March, 1976.

On 17 March the Prime Minister (Mr Malcolm Fraser) received a letter from a person calling himself Mr Richard Todd and claiming to be the managing director of Whitney Todd and Co., investment bankers. I seek leave to table a copy of the letter with its enclosures.

Mr DEPUTY SPEAKER (Mr Lucock:

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

Mr ELLICOTT:

-I would add that we have been advised by Treasury that the firm appears to be virtually unknown in the banking field. The New York address of 19 West 44th Street appears to be merely the address of the company’s lawyer. Whitney Todd and Co. is registered in California and offers its clients ‘banking business consulting’. The Prime Minister had no knowledge of the existence of the correspondence between various people in Queensland and elsewhere and Whitney Todd and Co. until he received the letter on 17 March. Since the matter did not involve the Commonwealth, the only action taken was to advise the Premier of Queensland that Mr Todd had sent this letter to him. The Prime Minister has not replied to the letter from Mr Todd and has no intention of doing so.

I would further like to emphasise that the Treasurer and the Treasury, since the change of government, have indicated in the clearest possible terms that loans to be raised overseas can be raised only through official Treasury sources. Any attempts to raise loans or any offers of funds are to be referred to the Treasury or they will not be dealt with. I seek leave to table a copy of the Treasurer’s Press statement dated 17 December last.

Mr DEPUTY SPEAKER:

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

Mr ELLICOTT:

-I present the following paper.

Overseas loans- Ministerial Statement, 6 May 1976

Motion (by Mr Sinclair) proposed:

That the House take note of the paper.

Mr LIONEL BOWEN:
Smith · Kingsford

– In the absence of the Leader of the Opposition (Mr E. G. Whitlam), who is away on official business at the present time- I want to make that clear- let me say that this statement from the Attorney-General (Mr Ellicott) is rather interesting. The information contained in it is such that it should be repeated and noted. The Attorney-General said that, as a result of all inquiries, it was found that there was ‘no substance in the suggestions that either the official or the 2 Ministers were involved in the wrongful conduct alleged’. That has always been the situation. The Opposition congratulates the Attorney-General for his honesty. But we must ask how it happened that in the middle of an election campaign the Premier of Queensland convened the Queensland Parliament for one day to make these malicious allegations across the length and breadth of the nation. It was an abuse of parliamentary procedure in this country. There was no evidence at all that warranted the calling together of the Parliament. The fact that the Premier dared to make the accusations without any evidence at all does not entitle him to hold that position.

I have not had more than a few seconds to look at the documents that have been tabled, but I notice immediately from the letter from the Premiers Department dated 14 November that Mr Todd is now apparently seeking some compensation for work that he undertook on behalf of the Premier of Queensland, suspicious and underhand as it may have been and as malicious as it was intended to be. The letter from the Premiers Department to Mr Richard Todd says: 1 hereby appoint you as my financial adviser concerning loan raising efforts by the Australian Government that was dismissed on 1 1 November 1975.

I note with interest that rumours- that is a vague term we use in this Parliament to cover up any real accusations- were evident on 2 November which warranted some investigation, the Attorney-General said. We now have from this gentleman, who is claiming his commission, a letter that he received on 14 November from the Premier of Queensland. The first sentence obviously refers to the dismissal of the Labor Government. In part, that letter states:

The authority conferred on you by this appointment may be terminated at any time.

In acting as my financial adviser, you are requested to cooperate with Mr W. A. R. Rae, Agent-General for Queensland.

This muck-racking expedition has been going on for some time- almost 12 months- on the basis that there have been kickbacks and secret commissions. Newspaper proprietors also have made those accusations against many members on this side of the House without any tittle of evidence. We now find, after we have had to flush out the material, that it was a phoney campaign by the Premier of Queensland. Thousands and thousands of dollars of the taxpayers’ money in Queensland was misappropriated by the Premier for his own dubious purposes. But was not the real benefit for the Government opposite? It did very well in Queensland in the elections. The people in Queensland might have been entitled, at that stage, to believe that their Premier had some evidence that 2 Ministers were involved and that those 2 Ministers had secret bank accounts.

All this nonsense has been played up in the Press as though there was some corruption in the then Government. The then Government was completely honest. The Attorney-General has vindicated and exonerated it. But we cannot exonerate the Government opposite, because it is part and parcel of the Bjelke-Petersen complex. It is against democracy in this country that a Parliament can be used to abuse Ministers in the Federal sphere, to make accusations and virtually to bring down a government.

Mr Baume:

– Against dead people.

Mr LIONEL BOWEN:

-The honourable member for Macarthur ought to be the last person to talk about the matter in the Parliament. Let us have a look at it from the point of view -

Mr Baume:

– I do not attack dead men.

Mr LIONEL BOWEN:

-I am saying that many of our colleagues were maligned, slandered, defamed and libelled in the coward’s castle of the Queensland Parliament. There is no excuse for maligning anybody who is dead, but honourable members opposite should not try to get away from this issue. The issue is that a Premier, who is pan and parcel of the National Country Party, called a Parliament together in Queensland, and never once have honourable members opposite raised any protest in this House. Never once have honourable members opposite had enough courage to stand up and disown that man. The only man who has shown any credit in this matter is the Attorney-General, who at least had the honesty to come into the Parliament and say that there was no evidence. Mr Bjelke-Petersen recently came to Canberra. I think it was in February. He wanted to see the Prime Minister (Mr Malcolm Fraser), but the

Prime Minister would not see him on that occasion. It was then said that Mr BjelkePetersen had further evidence. I think he ended up going to lunch with the Indonesian Ambassador, or something of that nature. Nobody wished to see him.

We are interested in the intelligence of a government that will stoop to that level to try to muck-rake against Ministers in a previous government and to try to bring down that government. Anything will do. What about the Khemlani affair? Who financed Khemlani? What about the moneys that went to Khemlani? Did they not come from a knight in Queensland? Who was paying the money? I invite the Government to have a royal commission into what money was paid to Khemlani; from what source in Queensland that money came; and whether it came from a source very close to the Country Party. Does not this add up to the fact that honourable members opposite will do anything to bring down a government? Tonight we have heard a statement which means nothing. Mr Todd, apparently quite rightly, feels that he is entitled to a commission, compensation and reimbursement because he was appointed an attorney by Mr Bjelke-Petersen, the Premier of Queensland, who stated:

I hereby appoint you as my financial adviser . . .

I ask whether it is any wonder that Mr Todd, in his letter to the Prime Minister, writes: 1 hope both you and Mr Lynch, your Minister for Finance, will take time to peruse this enclosed documentation.

Mr Jarman:

– He did not pass him an envelope.

Mr LIONEL BOWEN:

-Maybe he did not. Honourable members will notice that we have paid the penalty in the Press for all those accusations. But what penalty have Government supporters paid except the cover up of a Parliament in Queensland? How is it that they can justify their conduct? Which one of them now wants to get up and condemn the Premier of Queensland? They are not game. They do not have the courage because they want still to retain the reins of office on the basis of malicious accusations. We want to make it very clear that if at any time Government supporters felt there was any wrongdoing their duty was to convene a royal commission. If they think so now they should do it and have a look at it -

Mr Howard:

– We tried to do it in opposition and you denied it.

Mr LIONEL BOWEN:

-Do not talk about what you tried to do.

Mr Howard:

– We tried to do it in opposition and you denied it.

Mr LIONEL BOWEN:

-Please allow me to make the statement about what you can do. Honourable members opposite comprise the Government now and I am prepared to say to them that if they analyse Khemlani’s bank account they will see that the funds have come from people closely affiliated with honourable members opposite. If they want to have a look at the accusations - ( Government supporters interjecting)-

Mr LIONEL BOWEN:

-I am making a suggestion that honourable members opposite might want to explore. Also, we go back to the loan raising dealings and the accusations made by convicted criminals in Sydney as to what money was paid to them. It is well known that the present Treasurer was known as the bag man, running round with a stack of money to give money out to people who would make accusations. It is about time we had a look at the people who made the accusations and why they made them, and had a look at their bank accounts. Is it a fact that somebody readily paid his hospital debts in Sydney after making an accusation that was well known to the Treasurer? This is the sort of morality that the Government wants to espouse as being above suspicion. We say it clearly shows that there was never any tittle of evidence to support what the Queensland Premier has done. I hope Mr Burns, the Labor Leader, can bring this to the fore in any forthcoming Queensland election. It shows that Bjelke-Petersen is not fit to hold any office, not even as a company director when he can go to this sort of level to bring down anybody in public life on an innuendo, a smear, with all the attendant Press publicity.

Money was involved in this case but the money came from the Queensland Government and Queensland coffers and those who support the National Country Party in Queensland. It is about time that was flushed out. We have it here now that perhaps Whitney Todd and Co.- its address is New York- is entitled to compensation. It must come from the Queensland Government. It is about time that Mr Malcolm Fraser, as he is addressed in this letter, took some steps to suggest that the Premier of Queensland redeem his debts. He can never redeem his honesty. He can never redeem his integrity. He has lost that for all time. Accordingly, while we welcome the statement we deplore the fact that it clearly discloses there was a concerted effort, based on rumour, as far back as 2 November to have an investigation to see what the then Opposition could find out about Ministers of the Crown, including a public servant.

It has taken until now for it to surface that it was really a facade, an operation in political manoeuvring, to convene a Parliament in Queensland for one day, to make the accusations of curruption under the cloak of privilege. Not until now, until May, do we get the real facts. It did not matter what the then Opposition did. It just had anybody running around the world with all the attendant publicity and said: ‘We will not take any responsibility as to what they might find out’. Now, apparently the Queensland Premier is prepared to default on meeting his liabilities. I do not know what the nature of the claim is. It is obviously contained in the correspondence, but it would amount to a sum of money. If it does mean that the Prime Minister and the Deputy Prime Minister (Mr Anthony), who is a member of the National Country Party, ought to do something to help Whitney Todd, at least the Australian people would say: ‘For goodness’ sake, pay your debts in this respect’. Government supporters did nothing but slander people, malign people, and use up the resources of the Queensland Parliament and the Queensland Government without any right at all to do that. They did it on the basis of trying to bring down a government. Fancy, in the last week of an election campaign, convening a Parliament for one day. I think it is about time we said that we hope we have heard the last of this affair except for this fact -

Mr Cotter:

– Sit down.

Mr LIONEL BOWEN:

-I do not want to sit down until such time as we get an assurance there will be an investigation into what money was paid, and honourable members opposite do not want that. They would never be prepared to face up to that. I think the British Parliament has a higher standing.

Mr Howard:

– You gagged it while we were in opposition.

Mr LIONEL BOWEN:

-We never gagged anything at all.

Mr Howard:

– You did.

Mr LIONEL BOWEN:

-Is that all honourable members opposite can talk about? We are talking about a claim that should be investigated. One would think that it was not the Government making these accusations because it appears to be powerless now and unable to do anythingunable even to pay this man’s debt. Surely it could at least help the Premier of Queensland by giving him some money to pay Whitney Todd.

So take it as it is. It is the money of a Judas and honourable members opposite know it. The Opposition welcomes the statement but deplores its contents.

Mr ANTHONY:
RichmondDeputy Prime Minister · NCP/NP

-Mr Deputy Speaker-

Motion (by Mr Nicholls) put:

That the question be now put.

The House divided. (Mr Deputy Speaker- Mr P. E. Lucock)

AYES: 27

NOES: 75

Majority……. 48

AYES

NOES

Question so resolved in the negative.

If one likes to take one’s mind back to the latter part of last year one will remember that the whole country was in turmoil. Day after day there were fresh revelations of the Labor Party’s involvement in overseas loan borrowings to the point where a question could not be asked in this House or a speech made. Every gesture on the part of the then Opposition to get any information out of the Labor Government was gagged. There was no free speech in the Parliament. It was a terrifying situation. We had reached a crisis. This was a major contributing factor in the Senate’s blocking the passage of Supply.

After the blocking of the passage of Supply, while we were in that hiatus, there was a meeting in Melbourne of all leaders of the Liberal Parties and National Country Parties of Australia. On that day I think it was 2 November in the course of informal discussion among the leaders certain rumours were expressed about people in the Labor Party getting a kickback from these overseas loans borrowings. It was not just there that rumours were heard. This was the reason for the turmoil in the Labor Party. This was the reason that 2 Ministers were sacked from the Government. This was the greatest crisis this country has ever seen. Surely nobody will forget that period. A gentleman by the name of Mr Wiley Fancher was known to have information which could lead to the exposure of some of the facts. When this was told to the Premier of Queensland he quite willingly said: ‘I will investigate this matter. I will get to the bottom of it. ‘ Why should he not? All State governments were implicated by the fact of the Australian Loan Council’s involvement. The Whitlam Government tried to deceive the Australian people by unconstitutional means. It tried to get through an Executive Council minute so that it could go overseas and raise $4,000m- but then we find the amount is $8,000m- by quite unorthodox and highly suspicious means.

So the Premier of Queensland started an investigation. Between the time that he started the investigation and the time he obtained further information, the Labor Government was dismissed, and rightly so. But one of the conditions of dismissal was that there would be no further investigation by the Commonwealth Government into the overseas borrowing affair. That did not have any bearing on the Premier of Queensland. He had every right to continue to seek whatever information he could, and thank goodness he had the courage and the determination to find out the facts. Nobody ought to be ashamed of that. What are honourable members opposite frightened of? Are they frightened that there still might be some skeletons in the cupboard which somebody might unearth? Are they trying to intimidate the Premier of Queensland for wanting to get to the bottom of this? The caretaker Government of the day had no hand in it. After the election, after the Australian people had vindicated our actions, the Premier brought information to the Attorney-General which was sufficient to warrant a Commonwealth investigation. (Extension of time granted). I thank the House. So an investigation was carried out by the Attorney-General who, after assessing the information that was reported to him, found that there was no substance in the information and made a statement to that effect in this House on 1 8 March. Why has this matter come up?

Mr ANTHONY We all know that members of the Opposition are desperately looking for any diversion at the moment to try to take the pressure off their leader who has been responsible for one of the most appalling and disgraceful episodes in the parliamentary life of this country. I refer to his accusations against a late senator of this Parliament. They were most shameful. Any honourable member of the Australian Labor knows that they were shameful and disgusting, and can be regarded only as most despicable. I know that the honourable member for Fremantle (Mr Beazley) thinks exactly like that and I will be very surprised if he does not resign from the Labor Party as a result. Why has this matter been brought up? How did the Leader of the Opposition come to be in possession of this information?

Mr DEPUTY SPEAKER (Mr Lucock)Order! With regard to the point of order raised by the honourable member for Corio, I would say that the comments of the Deputy Prime Minister would be no stronger in accusation than some of the comments that were made on a previous occasion by the honourable member for Kingsford-Smith himself in relation to a previous debate. As I understood it, the right honourable gentleman made no accusation whatsoever but asked a question.

Mr KEATING:
Blaxland

-This is just more evidence of how the coalition connived, deceived and cheated its way into power. We found on examination of the letters that the authority was issued by the Premier of Queensland on 14 November, 3 days after the general election campaign had begun. This was a conscious breaking of the undertaking given by the present Prime Minister (Mr Malcolm Fraser), the Leader of the National Country Party (Mr Anthony) and the prominent members of the Government to the Governor-General that they would abide by the guidelines for the caretaker Government and that they would not be involved in muck-raking. But we find that they could not be trusted. Let me quote from the letter from Mr Todd to the Prime Minister. It states:

Mr Fancher stated that you

That is Mr Fraser- were working through Mr Bjelke-Petersen because you had a gentleman s agreement with the Governor-General, Sir John Kerr, not to pursue the Whitlam situation until after the general election on December 1 3.

What do we find? We find that honourable members opposite broke the spirit of the undertaking that they gave to the Governor-General. Not only did they not abide by the decision when the House did not have confidence in them, but they also did not have the decency to stay within the Governor-General’s guidelines and not muck-rake. So what did they do? They abided by the letter of the law. They did not have any Government instrumentalities or department out doing their dirty work. They had the Premier of Queensland doing it by way of an agreement with the Leader of the Country Party and the

Leader of the Liberal Party had arranged with him. The Premier of Queensland issued the letter on 14 November to this character Todd asking him to go and look and to investigate the socalled bribery. Not only is the question of the propriety of the activities of the Premier of Queensland brought into -

Mr Jarman:

-I take a point of order. May I seek your guidance, Mr Deputy Speaker? Does the Prime Minister or the Deputy Prime Minister have any power to direct a State Premier. I ask for your advice.

Mr DEPUTY SPEAKER (Mr Lucock)Order! No point of order is involved in the matter raised by the honourable member for Deakin.

Mr KEATING:

-The point is that the Premier of Queensland was a party to the breaking of the undertaking given by the present Prime Minister and the Leader of the National Country Party to the Governor-General. This meant they could not even keep the word they had given. Amongst the material which has been released is a telegram from Mr Todd addressed to Mr Fancher which states:

Congratulations on Mr Fraser’s victory. When will you be prepared to proceed with the financing?

Do honourable members think that these people were not involved in some political machinations? Another letter dated 14 January from the Agent-General of Queensland in London addressed to Mr Todd of the Whitney Todd bank states:

When it comes to great guys I can feel I can number you among my acquaintances.

This is the sort of relationship that the AgentGeneral of the Queensland Government had with an American banker involved in political muck-raking during the election campaign. The American banker goes on to say in another letter dated 16 February which is addressed to the same Agent-General of Queensland in London:

I expect my billing to be paid in full by 1 March 1976.

Not only are these people opposite cheats but they are also welshers. They will not even pay for the rotten services that were undertaken upon their behalf. No matter where one looks into the behaviour of the members of the then Opposition last year, one finds that they used every conceivable instrument at their disposal to cheat their way into power. Honourable members should look at the behaviour of the present Treasurer, Mr Lynch, when he was the Deputy Leader of the Opposition. It would be nice to have a royal commission to find out who financed him in his trips and who financed the hotel bills and air travel expenses of Mr Andrew

Hay who was running all over Europe. Who financed them? We will find that three corporation in Australia put the money into the can which was, of course, carried by the present Treasurer (Mr Lynch). He was the bag man in the operation to try to discredit the then Prime Minister and senior Ministers of the Whitlam Government, men who had their names besmirched, all because of cheap politicking.

The Attorney-General (Mr Ellicott) now has to expose his whole party by saying that there was not any evidence of any corruption at all. We find that the movements of Mr Khemlani, who appeared fortuitously during the election campaign and in the time leading up to the dismissal of the Government on 11 November, were financed from the slush funds by the present Treasurer, Mr Lynch. Mr Licardy, a solicitor in Sydney who was representing Khemlani, finally had his bills paid, after Khemlani skipped the country, again by Mr Lynch and probably carried by Mr Hay. This is the behaviour of this despicable party opposite which cheated its way into power.

The charge is a substantial one. The charge we lay is that the present Prime Minister of Australia broke an indertaking that he had given to the Governor-General during the time that the Liberal-Country Party was the caretaker Government. These people who did not have a majority in the House of Representatives, these people who lost the previous election and were masquerading as the Government of Australia could not even abide by the agreement they had given to the Governor-General even though they were suggesting that the Governor-General was acting with completely propriety.

Mr Sinclair:

– This is before the Government went into office.

Mr KEATING:

– It was on 14 November. You are quite wrong. You do not even know. The letter of 14 November 1975 to Mr Richard Todd from the Premier of Queensland states:

I hereby appoint you as my financial adviser concerning loan raising efforts by the Australian Government . . .

That was 3 days after the campaign started. It just means that the Government will do anything for political power. You will cheat, you will lie, you will deceive, you will break agreements, you will do anything.

Mr DEPUTY SPEAKER (Mr Lucock)Order! The honourable member for Blaxland will withdraw that remark.

Mr KEATING:

– I say it in a corporate sense against the Government. I do not say it against any individual in the Government but against the Government in general, against the Party. It did these things.

Mr Sinclair:

- Mr Deputy Speaker, I rise on a point of order. The honourable gentleman is making these accusations in regard to a statement relating to an interjection that I made. I take it as a personal innuendo and I ask for its withdrawal.

Mr KEATING:

-It would be accurate.

Mr DEPUTY SPEAKER:

-Order! The House will come to order. In regard to what the honourable member for Blaxland has said, he has been speaking about the caretaker Government and about the individual. In that sense, I would suggest that the honourable member for Blaxland withdraw the remark when he said ‘you will he ‘.

Mr KEATING:

- Mr Deputy Speaker, may I say quite clearly against the former Opposition, the caretaker Government, that in the corporate sense it cheated and lied and deceived its way into power.

Mr Sinclair:

- Mr Deputy Speaker, on a point of order, as a member of the former Opposition I take strong exception to that accusation.

Mr DEPUTY SPEAKER:

-Order! This matter has arisen before, and I think that the honourable member for Blaxland will recall that the accusation was made in a general statement. If my memory serves me correctly, every individual member of the Opposition stood up and requested that it be withdrawn. I would suggest to the honourable member that he withdraw the remark.

Mr KEATING:

– I will withdraw it, Mr Deputy Speaker, so that I do not take up the time of the debate. But I can assure you that my feelings stand. The point is that members of the then Opposition were prepared to use any instrument at their disposal to try to discredit the Whitlam Government and its Ministers. The matter is still being litigated in the courts in New South Wales, obviously dragged on with money financed from the original slush fund which was managed by the present Treasurer. I had occasion during the proceedings to illustrate how shoddy the whole thing was. My Lynch accosted me in Kings Hall at about midnight one night during the debate to say that he knew more of what was going on in the Treasury than the then Treasurer; that the original leaks about the loans affair came to him from the Treasury; that the Opposition used former confidences it had with public servants in departments of the Commonwealth while it was in government to threaten those people because when it became the Government it wanted to keep all the information coming in.

When the then Opposition finally got into a situation where it could not hide behind parliamentary privilege, when the House of Representatives had risen for the election campaign, when the caretaker Government had given an undertaking to the Governor-General that it would not continue muckraking in the disgraceful way that it had been doing, what did it then do? The Deputy Prime Minister (Mr Anthony) would have given a call to the Queensland Premier and it would have been all sorted out 3 days later. Fraser would have given him a call, and the next thing you know he has this character running around over there in London trying to muckrake, trying to get around the letter of the undertaking given to the Governor-General. I believe that that is a serious charge and that the Prime Minister ought to answer it. The Prime Minister ought to be big enough to come into the House and disclose his dealings with the Queensland Premier, disclose what was a specific undertaking given to the Governor-General.

That just illustrates the lengths to which the then Opposition, the present Government, the establishment of Australia, would go to get into power, to rob the legitimate government of power. Even in this Parliament it is obvious that it is not an elated government. I have never seen a drearier looking government in my life. When Labor was elected in 1972 we were happy about our election, but this crowd look as if they have stolen the Crown jewels. They know that they have done the wrong thing, that they have cheated their way into power. I have not seen the Deputy Prime Minister looking pallid until tonight. He has not said a word since he took on his ministerial portfolio. The great lions of the Opposition a few months ago are now all lying doggo. Why? It is because they cheated themselves into power, and now the Australian people are waking up to them. They have just elected a Labor Government in New South Wales, the largest State in Australia. This crowd is now lying doggo, but gradually their dirty behaviour comes out. Gradually they are being exposed. The dirty work of last year is being exposed. I would like to find out through a royal commission where Mr Lynch got the money from and which Australian enterprises contributed. I know which ones they were, but I want it to go on the record which corporations contributed. Who paid Andrew Hay’s hotel bills all through Europe? Who paid for the flights backwards and forwards to London chasing up the bankers? Who paid Khemlani? Khemlani is absolutely broke, obviously. Who paid his fares to Australia all the time? Who picked up Licardy’s bills- the Liberal Party. Now its members are afraid. Finally they are exposed by an honest man, their own Attorney-General. They probably will hold his honesty against him because he is not a muckraker like the rest of them. Where is the Prime Minister? He has scurried out of the chamber. Honourable members opposite bring on this matter when the Leader of the Opposition (Mr E. G. Whitlam) is out of the chamber. They knew that the Leader of the Opposition was not in the House.

Mr DEPUTY SPEAKER (Mr Lucock)Order! I suggest that the House come to order; otherwise the honourable member for Blaxland might not be looking at anybody on either side of the House. I suggest also that on this occasion the debate and the House are not being assisted by either interjections or encouragement from both sides when one honourable member is speaking. I suggest that the House spend the remaining minutes of the debate in order.

Mr KEATING:

– The fact is that the debate was brought on in the absence of the Leader of the Opposition, and the Government knew that he would not be here tonight. In the absence of the Prime Minister, who is not here to face the charges, let the Deputy Prime Minister say whether he was present when Mr Fancher called him from overseas. Let the Deputy Prime Minister say whether he knew about the details of his dealings with the Queensland Premier. He can make a statement. We will give him leave to make a statement, to tell us of his dealings with the Queensland Premier and to deny that he phoned the Queensland Premier. Let him tell the House of Representatives. Let him stand up and tell the truth as a Minister and say that he had no dealings or that the Prime Minister had no dealings. Of course, they cannot do it and they will not do it.

Honourable members opposite are gradually being found out for the type of people they are. They are not interested in parliamentary government, Cabinet government or democracy. All they are interested in is power- nothing but pure political power. That is why they have run so doggo in the House of Representatives since being elected to office. They are not the jeering brigade they were last September and October on the scent of power. They know that, if they had pressed things too far, they were on the edge of civil strife. It was only because the decent people in the Labor Party held the thing back that the country survived. Honourable members opposite were prepared to see family against family. They were prepared to see the social fabric of this country ripped in half because they would not wait 1 8 months for an election. That is the real issue; they would not wait 1 8 months for an election. All the precedents they have established- the precedent in the Senate, the precedent involving the Governor-General, and so on- will rebound on them. History has a way of repeating itself and they will be found out for the way in which they came to power. A specific charge has been laid against honourable members opposite tonight by their own AttorneyGeneral. Let the Prime Minister come here, be a man, stand up and say whether he did flout the terms of the agreement with the GovernorGeneral, whether he did deal with the Premier of Queensland and what his relationship is with Mr Fancher. Let him for the first time in his life give an honest statement to the Australian people, instead of trying to deceive them for his own shabby political purposes.

Mr ANTHONY (Richmond-Minister for National Resources and Minister for Overseas Trade)- Mr Deputy Speaker, I have been misrepresented -

Mr Bryant:

- Mr Deputy Speaker, I raise a point of order. Nothing that has been said could possibly be claimed to have misrepresented -

Mr DEPUTY SPEAKER (Mr Lucock)Order! The honourable member for Wills will resume his seat.

Mr ANTHONY:

– I was deliberately misrepresented by the honourable member for Blaxland (Mr Keating), who said that the caretaker Government had been involved in this approval for Mr Richard Todd to act for the Premier of Queensland after the dismissal of the Government.

Mr Keating:

– Yes, that is our charge.

Mr ANTHONY:

-That is his charge. He makes selective use of documents. If he has a look at the documents which have been presented tonight by the Attorney-General (Mr Ellicott) and which I am prepared to lay on the table, he will see that there is a document dated 8 November written by the Premier of Queensland to the Agent-General for Queensland in London and saying that Mr Todd had been appointed as his financial adviser 3 days before the dismissal of the Government. To say that we got involved after that dismissal or that we disowned -

Mr Keating:

- Mr Deputy Speaker, I raise a point of order. It is 14 November.

Mr ANTHONY:

-That is your selected document.

Mr Keating:

– You gave the damn thing to us.

Mr ANTHONY:

– It has no relevance whatsoever -

Mr DEPUTY SPEAKER:

-Order! The honourable member for Blaxland and the Deputy Prime Minister will resume their seats. I warn the House that if there is any more behaviour like this during this debate I will leave the Chair. Serious charges and counter charges have been made in this House tonight. Quite frankly, the behaviour from both sides of this House has been disgraceful. I warn the House that if there is any more behaviour along that line I will immediately leave this Chair. In reply to the point of order about the personal explanation made by the Deputy Prime Minister, I say that the comments that he made were more general than particular. But in the circumstances, with the honourable member for Blaxland having made a statement and then, when the Deputy Prime Minister was speaking, making an interjection and commenting, I allowed the Deputy Prime Minister to continue with that personal explanation.

Mr KEATING (Blaxland) -On the same point, Mr Deputy Speaker -

Mr DEPUTY SPEAKER:

-Does the honourable member claim to have been misrepresented?

Mr KEATING:

– I claim to have been misrepresented. A letter was tabled by the AttorneyGeneral (Mr Ellicott) in the Parliament tonight. I hold it up for you, Mr Deputy Speaker, and for anybody else to see. It is headed ‘Premier’s Department, Brisbane, Q.4000. 14th November, 1975’. It is addressed to Richard Bradburn Todd.

Mr Sinclair:

– Six days later.

Mr KEATING:

– That is 3 days after the former Government was dismissed. The letter reads:

I hereby appoint you as my financial adviser concerning loan raising efforts by the Australian Government that was dismissed on 1 11th November, 197S.

The authority conferred on you by this appointment may be terminated at any time by written notice under my hand.

In acting as my financial adviser you are requested to cooperate with Mr W. A. R. Rae, Agent-General for Queensland.

I make the charge. The Government ought to answer it.

Mr LYNCH:
Treasurer · Flinders · LP

– I claim to have been misrepresented.

Mr DEPUTY SPEAKER:

-The Treasurer claims to have been misrepresented.

Mr LYNCH:

- Mr Deputy Speaker, in a very low key, which I think is what this debate now requires, I claim to have been deliberately misrepresented by the previous Labor speaker in this debate and I think by the Labor speaker before him. The House will recall that a number of charges have been laid tonight, as they have been mischievously laid before, that the former Opposition in fact paid money for the purpose of exposing the Labor Party in relation to the loans affair. I have said before, and I repeat here tonight without any qualification whatsoever, that not one cent was paid to any person in this country or overseas for the information which was given freely to the then Opposition for what I believe to have been in the national interest of this country.

Mr Keating:

– You are a liar.

Mr LYNCH:

-I ask that that be withdrawn.

Mr DEPUTY SPEAKER:

-The honourable member for Blaxland knows that that comment is unparliamentary.

Mr Keating:

– Yes, I know that it is unparliamentary, Mr Deputy Speaker, and I withdraw it for the purposes of the Parliament, but the feeling stands.

Mr DEPUTY SPEAKER:

-Order! The honourable gentleman knows that I have asked him to withdraw it. I suggest that he withdraw it unreservedly.

Mr Keating:

– Yes, I withdraw.

Mr LYNCH:

– Secondly, I want to clear the record, as I have done before, in relation to the allegations which the honourable member has made concerning the Federal Treasury. Whatever his recollection is, the assertions that he made in this House tonight are absolutely without foundation. It is a mischievous charge against an important area of the Public Service and I think that it ought to be withdrawn.

Mr Bryant:

– I raise a point of order. The Treasurer is making a speech about it and not a personal explanation. As far as I know, he did not actually own or control the Treasury up until -

Mr DEPUTY SPEAKER:

-Order! There is no point of order.

Mr KEATING (Blaxland)-I claim to have been misrepresented by the Treasurer (Mr Lynch). What I said concerning the conversation that I had with the Treasurer can be substantiated by Mr Jost of the Age and Senator Wheeldon who were both present when the conversation took place.

Mr DEPUTY SPEAKER (Mr Lucock)Because of the discussions and counter discussions I am not quite sure which side had the last call. I call the honourable member for Mackellar.

Mr WENTWORTH:
Mackellar

– I would be more impressed by the Opposition’s call for some inquiry were it not for the behaviour of its members this morning when they endeavoured, by every device available, to frustrate any possibility of an inquiry into the most grave charges that have been made against their leader, the Leader of the Opposition (Mr E. G. Whitlam). These charges are substantial. They are made on credible grounds. They are the gravest charges ever made against any member of this Parliament in the history of Federation. I simply say that the charges have been made already.

Dr Klugman:

– I take a point of order. This discussion, as I understand it, relates to the noting of a statement by the Attorney-General. Surely it has nothing to do with a motion on the notice paper in the name of the honourable member for Mackellar- a motion which his side of the House would not let him move this afternoon.

Mr DEPUTY SPEAKER:

– Dealing with the point of order raised by the honourable member for Prospect, I suggest to the honourable member for Mackellar that he is out of order on 2 counts. Firstly, he is anticipating a debate on a subject matter that he has put before the House. Secondly, he is referring at length to matters debated in this House today which in a direct sense do not have relevance to the subject before the House tonight. I rule on both counts that the honourable member is out of order.

Mr WENTWORTH:

-Mr Deputy Speaker, my motion has been withdrawn and it is not on the notice paper. Secondly, the matter was not discussed in the House this morning.

Dr Klugman:

– It has nothing to do with this debate.

Mr DEPUTY SPEAKER:

-Order! I understand that the notice has not been withdrawn.

Mr Morris:

– He should tell the truth.

Mr DEPUTY SPEAKER:

-Order! I suggest that honourable members are not helping with their interjections.

Mr WENTWORTH:

-The notice has been withdrawn.

Mr DEPUTY SPEAKER:

-Order! Referring to the second count, the subject matter which the honourable member for Mackellar refers to when he speaks about the Opposition endeavouring to frustrate certain events today has reference to what happened in this House today. I again say that he is out of order on both counts.

Mr WENTWORTH:

-Sir, I will not refer to that subject. I point out that the motion is withdrawn and that is the situation as it is today. The Leader of the Opposition has been the subject of the gravest charges ever levelled against a member of this Parliament, and those charges -

Mr Hurford:

– I take a point of order. The honourable member for Mackellar is transgressing your ruling, Mr Deputy Speaker. You have quite rightly said that irrespective of what document has been handed to the Clerk, notice has not been properly given to this House about the motion which was on the notice paper in the name of the honourable member for Mackellar. Furthermore, this debate relates specifically to the noting of a statment made by the AttorneyGeneral. That statement has specific limitations. The honourable member for Mackellar ought to be asked to stick to the statement made by the Attorney-General.

Mr DEPUTY SPEAKER:

– Replying to the point of order raised by the honourable member for Adelaide, what he said has relevance but I would point out that the honourable member for Mackellar has made only a brief statement and it is not possible at this point of time to fully assess what he is going to say. I would point out to the honourable member for Mackellar that I have given a ruling and if he continues along the lines he has indicated he will be out of order.

Mr WENTWORTH:

-Mr Deputy Speaker, I do ask you to rule that my remarks are relevant in this regard: Very grave charges have been made against the Leader of the Opposition and the sincerity of the Opposition’s whole case tonight must be assessed in the light of those charges, together with the reaction of Opposition members to them. The Opposition is obviously trying to do everything that it can to prevent this matter being discussed. It is essential that it should be discussed because -

Mr DEPUTY SPEAKER:

-Order! I suggest to the honourable member for Mackellar that he is debating the subject matter of his notice of motion which I have ruled out of order in using it as an illustration in relation to the matter that is before the House at this moment. While the honourable member can discuss the subject matter of the paper presented by the AttorneyGeneral and of which the House is taking note, he should not refer to the matters which are covered in general terms in his motion.

Mr Sinclair:

– Speaking to the point of order, Mr Deputy Speaker, I point out that in the substance of the matters tabled you will find significant references to charges made against the Leader of the Opposition and other former Ministers in the former Labor Government. The honourable member for Mackellar is referring to those charges. To date, all that has happened is that members of the Labor Party seem persistent in their efforts to destroy the right of and the opportunity for the honourable member for Mackellar to speak in this Parliament on this matter.

Mr DEPUTY SPEAKER:

-Order! Commenting on the point of order raised by the Leader of the House, I remind the House that the remark that the honourable member for Mackellar made which I said was out of order was that the Opposition had endeavoured to frustrate him by preventing him from bringing on the subject matter of his motion today. Now, that has no relevance to the matter before the House at the moment. If the honourable member continues by debating other matters that have been mentioned by other speakers during this debate that is another matter. But at this time the honourable member referred specifically to an action of the Opposition in trying to frustrate him in moving his motion, discussion of which I have ruled is out of order. I call the honourable member for Mackellar.

Mr WENTWORTH:

– I do wish to draw attention to the lack of sincerity which has been evidenced by Opposition members tonight. As evidence of the lack of sincerity in respect of the matter on which I wish to speak, let me mention that Opposition members have been unwilling from time to time- I am not referring to the events of today- to countenance any inquiry into the conduct of their own Leader. I wish to show how disgraceful the conduct of that Leader would be if the charges made against him were true. I think that it is important that I should have the opportunity of reiterating what those charges were, so that the sincerity of the -

Mr Uren:

- Mr Deputy Speaker, a statement was made in the House tonight by the AttorneyGeneral. It has nothing whatsoever -

Mr Sinclair:

– On a point of order, Mr Speaker, by what right is the Deputy Leader of the Opposition now speaking? Is he making a speech? What is he doing?

Mr Young:

– He is on a point of order.

Mr DEPUTY SPEAKER:

-Order! I anticipate that the Deputy Leader of the Opposition is taking a point of order related to the remarks of the honourable member for Mackellar.

Mr Uren:

– The honourable member for Mackellar is dealing with statements by the Leader of the Opposition. The statement made tonight by the Attorney-General deals with charges made by the Queensland Premier in the Queensland Parliament against 2 Ministers in the Whitlam Labor Government. The AttorneyGeneral clearly exonerated both those former Ministers. That is what the statement tonight was directed to. That statement concerns the actions of the Queensland Premier and not the actions of the former Prime Minister who is now the Leader of the Opposition.

Mr DEPUTY SPEAKER:

– In reply to the point of order raised by the Deputy Leader of the Opposition, I would point out that in the course of this debate the actions of the caretaker Government and various other people and groupings have been raised. To that degree, the ambit of the debate is not strictly narrow. The only ruling that I have given is that the honourable member for Mackellar should not refer to the subject matter of his notice of motion which is still on the notice paper and which refers to the actions of the Leader of the Opposition in this sphere. I suggest, as I said earlier to the honourable member, that he do not carry on in that particular line.

Mr Uren:

- Mr Deputy Speaker, I rise on a point of order. I have 4 pages of the statement made by the Attorney-General and my colleague has all the appropriate documents tabled. In no way were the actions of the former Prime Minister, the present Leader of the Opposition, in any way involved in either the statement or the associated documents. The honourable member for Mackellar is deliberately trying to turn the debate onto the statement made by the Leader of the Opposition.

Mr DEPUTY SPEAKER:

-Order! I suggest to the Deputy Leader of the Opposition that he give attention to the remarks that have been made by the various speakers in this debate up to this present stage. Apart from that one particular point to which I have referred the honourable member for Mackellar is in order. I call the honourable member for Mackellar.

Mr WENTWORTH:

-Mr Deputy Speaker, I thank you for your ruling. I am endeavouring to test the sincerity of the members of the Opposition during this whole debate by pointing out their sins of omission. I do this by saying that they know perfectly well that the very gravest charges have been made against their own Leader. They are not trivial charges. They are not the kind of charges that have been made tonight. They are charges -

Mr Uren:

- Mr Deputy Seaker, I rise on a further point of order. I again ask you to listen to the words of the honourable member for Mackellar as he speaks about the charges against the Leader of the Opposition. Where, in this statement with which we are dealing, are there any charges against the Leader of the Opposition? The charges that were made were made by the Queensland Premier in a special session of the Queensland Parliament. In this statement the Attorney-General clearly wanted to dissociate himself and the Government in every respect from the Queensland Premier. That is what the statement is all about. That is what the associated documents are all about. I ask you, Mr Deputy Speaker, to bring the honourable member for Mackellar to order.

Mr Howard:

- Mr Deputy Speaker, I rise on the point of order. During the course of the debate speakers from the Opposition, particularly the honourable member for Blaxland, spent most of their time talking about the alleged actions of Leaders on this side of the House during the caretaker period. The charges to which the honourable member referred relate to the alleged actions of the Leader of the Opposition during the same caretaker period. I submit that on those grounds the actions to which the honourable member for Mackellar is referring are at least as relevant as the allegations made by the honourable member for Blaxland which were not made the subject of time consuming points of order from this side of the House.

Mr DEPUTY SPEAKER:

– I uphold the point of order raised by the Minister for Business and Consumer Affairs. It is the ruling that I have given in the sense that within the framework of the general discussion the honourable member for Mackellar is entitled to mention the present Leader of the Opposition. He is not entitled- and that is the point I have made- to refer to him within the terms of the motion that he has on the General Business Paper which refers in particular circumstances and terms to an event. On that account I do not uphold the point of order of the Deputy Leader of the Opposition.

Mr Young:

– I rise on a point of order, Mr Deputy Speaker.

Mr Katter:

– This is becoming a farce, Mr Deputy Speaker.

Mr Young:

– So are you. Mr Deputy Speaker, we are debating the long awaited statement of the Attorney-General. Obviously he is better in the written word than he is in the spoken word. He is far more difficult to follow in the spoken word when he is -

Mr DEPUTY SPEAKER:

-Order! This is not a point of order.

Mr Young:

– The honourable member for Mackellar wants to turn this into reverse. He wants to put this statement in reverse to make it appear as if the Leader of the Opposition and /or the Labor Party, or both, are on trial.

Mr Bourchier:

- Mr Deputy Speaker, I rise on a point of order.

Mr Young:

– I am speaking on a point of order, dumb-dumb. Sit down!

Mr DEPUTY SPEAKER:

-Order! I inform the honourable member for Port Adelaide that I have given a ruling on this, and the ruling is that the honourable member for Mackellar is not out of order insofar as he covers the general matter and not the particular matter. I point out to the honourable member for Port Adelaide, as I have pointed out to other members of the Opposition who have taken a point of order, that this is as relevant as other references that have been made. Names and other matters have been mentioned that are outside the narrow confines of the statement made by the Attorney-General. I think the honourable member for Mackellar is in order and I will permit him to proceed. I call the honourable member for Mackellar.

Mr WENTWORTH:

– I am saying that the charges made against the Leader of the Opposition are the gravest charges that have ever been made credibly against any member of the Parliament in its history.

Mr DEPUTY SPEAKER:

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

Suspension of Standing Orders

Mr SINCLAIR:
Leader of the House · New England · NCP/NP

- Mr Deputy Speaker, I move:

In speaking to that motion, I think it is relevant to say that in this House tonight and over the course of the last few weeks we have seen demonstrations of the totally irresponsible attitude by members of the Australian Labor Party towards the running of the House. They are not prepared to permit the honourable member for Mackellar (Mr Wentworth) to speak on any occasion in the House. They have chosen to use the Standing Orders and to move motions in their endeavours in this regard. They have chosen to interrupt him in every possible way. I think everyone who is listening to the radio broadcast of the Parliament tonight, as well as honourable members, need to be cognisant of the fact that it is not just a light charge that the honourable member for Mackellar seeks to present in the Parliament. It is not something that is just a product of his imagination. The action of honourable members opposite tonight again demonstrates that they are not prepared to have open debate in the Parliament -

Mr DEPUTY SPEAKER:

-Order! The honourable member for Port Adelaide wishes to raise a point of order.

Mr Young:

- Mr Deputy Speaker, I wish -

Mr SINCLAIR:

-He is the great democrat. Let him tell us about what happened -

Mr DEPUTY SPEAKER:

-Order! The Leader of the House will cease interjecting.

Mr Young:

– I do not mind, Mr Deputy Speaker, because the Leader of the House represents the views of the honourable member for Mackellar. Yet he will not put the honourable member on the front bench because he knows that he is an old phoney. I am taking a point of order because the Leader of the House is saying in his 10-minute speech to support his motion that the honourable member for Mackellar be given an extension of time all the things that you have ruled out of order for the honourable member for Mackellar to say. Mr Deputy Speaker, honourable members opposite are just taking advantage of you. Your rulings have been correct and they ought to be upheld. I submit that the Leader of the House ought to be ruled out of order.

Mr DEPUTY SPEAKER:

– I call the Leader of the House.

Mr SINCLAIR:

- Mr Deputy Speaker, I recognise that most honourable members opposite are immature, inexperienced and inadequate. But I also understand that a few of them- too few, regrettably- respect the procedures and practices of the Parliament. I am seeking to ensure that within the Parliament honourable members have an opportunity to speak in a way which destroys the practice of malicious interruptions which has so frequently taken place when the honourable member for Mackellar tries to speak. It is for that reason that I have moved for the suspension of Standing Orders.

Mr Scholes:

- Mr Deputy Speaker, I rise to order. I submit that the Leader of the House is reflecting on the Chair when he says that the rulings given by the Chair against the honourable member for Mackellar are designed to prevent the honourable member for Mackellar from speaking in the House. That is an improper reflection upon the Chair and it should not be made.

Mr DEPUTY SPEAKER:

– I will deal with the point of order raised by the honourable member for Corio. I hope that the remarks made by the Leader of the House were in relation to points of order taken by members of the Opposition. I will not say whether this was deliberate or otherwise. I will say that the 3 points of order taken were on exactly the same subject matter. But also let me say in fairness that the honourable member for Mackellar commenced speaking with the same phrase 3 times. I suggest to honourable members that if the Chair gives a ruling, it is most unwise for the honourable member against whom the point of order has been taken to stand up and commence his speech with exactly the same phrase as was ruled out of order. I suggest also that honourable members remember that the Chair is not here for the benefit of any one individual or party, whether it be the Government parties or the Opposition party. The Chair is here to endeavour to uphold the Standing Orders and to make rulings in debate which will assist in the business and the progress of legislation through the House. That is the reason for my previous ruling. If the Leader of the Government moves the suspension of the Standing Orders to enable the honourable member to continue his remarks, I do not regard that in any sense as being a reflection upon the Chair.

Mr SINCLAIR:

- Mr Deputy Speaker, I can assure you that the motion for the suspension of Standing Orders which I have moved is in no way a reflection on the Chair. It is a reflection on the inadequacies of members of the Labor Party, their unfortunate susceptibility to valid charges which have been made against them and the actions by which they have denied the honourable member for Mackellar, as they have denied the honourable member for St George (Mr Neil), any opportunity in this Parliament on successive occasions- during adjournment debates; during General Business today- to make a case and to state an argument in the Parliament. It is unfortunate that I need to have recourse to a motion for the suspension of Standing Orders, but it seems to me that that is the only way by which I can present an opportunity for the very worthy and honourable member for Mackellar to speak in this Parliament. It is for that reason I have moved the motion.

I believe that there are very substantive charges which need to be made. The honourable member for Mackellar seeks an opportunity to make them. It appears that this is the only way by which he can do so. We on this side of the House have given successive members of the Opposition opportunities which one would regard as going very close to breaching parliamentary proceedings, but we have in no way sought to interfere. You, Mr Deputy Speaker, have equally afforded them the complete privilege that the Standing Orders provide for them. We seek no more than that for the honourable member for Mackellar. Therefore I have moved the motion.

Mr Howard:

– I second the motion. I shall move:

That the question be now put.

Mr DEPUTY SPEAKER:

– I point out to the House that the Chair has not yet had time to put the question. The question at this moment is, that the Standing Orders be suspended to enable the honourable member for Mackellar to speak without interruption for a period not exceeding IS minutes.

Mr SCHOLES:
Corio

-This is typical of the double standards -

Mr DEPUTY SPEAKER:

– At the moment the only question before the House is that the Standing Orders be suspended.

Mr SCHOLES:

– That is the motion to which I am speaking.

Motion (by Mr Sinclair) put:

That the question be now put.

Question put.

The House divided. (Mr Deputy Speaker- Mr P. E. Lucock)

AYES: 75

NOES: 28

Majority……. 47

AYES

NOES

Question so resolved in the affirmative.

Mr DEPUTY SPEAKER (Mr Lucock:

-The question now is:

That so much of the Standing Orders be suspended as would prevent the honourable member for Mackellar speaking without interruption for a period not exceeding 15 minutes.

Question put

The House divided. (Mr Deputy Speaker- Mr P. E. Lucock)

AYES: 75

NOES: 28

Majority……. 47

AYES

NOES

Question so resolved in the affirmative.

Mr WENTWORTH:
Mackellar

-I thank the House very much for having carried the motion because being able to speak without interruption will now give me an opportunity -

Mr Young:

– I cannot hear the speaker while all the Liberal and National Country Party members are talking in the corridors of the chamber, Mr Deputy Speaker. If you would ask members of the Liberal and National Country Parties to be quiet we may be able to hear.

Mr DEPUTY SPEAKER:

-Order! The honourable member for Port Adelaide will return to his seat. I suggest that honourable members, if they are going out, retire from the chamber as quickly as possible and not stand in the corridors and engage in conversation.

Mr WENTWORTH:

-The House has carried a motion that I speak for IS minutes without interruption. That will give me an opportunity to tell the House and the country those things which the Opposition so sedulously wants to conceal, and let some of the truth be known. The position is that the most serious charges have been made against the Leader of the Opposition (Mr E. G. Whitlam) and those charges are not made lightly. They have been made -

Mr DEPUTY SPEAKER:

-Order! I suggest to the honourable member for Mackellar that the subject matter before the House has no relation to charges concerning the Leader of the Opposition; it is the statement made by the AttorneyGeneral. I suggest that if the honourable member desires to continue his speech his remarks remain relevant to the subject matter before the Chair.

Mr WENTWORTH:

-As I understood it, Standing Orders were suspended to enable me to speak without interruption and I would hope I would be able to do that.

Mr DEPUTY SPEAKER:

-Standing Orders have been suspended in relation not to the relevance of remarks to the subject matter but only to being able to speak for 1 5 minutes.

Mr WENTWORTH:

-Mr Speaker, I raise a point of order. The House has carried the motion that I be entitled to speak for 15 minutes without interruption. I am proposing to avail myself of the vote of the House. I wanted to tell the House and the country those things which the Opposition has for so long been trying to conceal.

Mr Young:

– I rise to order. I ask very seriously whether a resolution of this House on a motion moved so subtly by the Leader of the House -

Mr SPEAKER:

-The honourable gentleman will make his point of order.

Mr Young:

- Mr Speaker, I ask you to bear with me because you have just arrived in the chair. I ask whether the resolution of the House- it may not have been noticed by a lot of honourable members that the motion moved by the Leader of the House was that the honourable member for Mackellar be allowed to speak for 1 5 minutes without interruption- can override the Standing Orders of this House.

Mr SPEAKER:

– I will deal with points of order as they arise. There is no substance in the point of order raised by the honourable member.

Mr WENTWORTH:

– Thank you, Mr Speaker. I hope that the House will observe the terms of its own resolution, that is, that I be allowed to speak without interruption, because I am trying to tell the House and the country of the very grave charges which have been made against the Leader of the Opposition and made with some substance. They amount to this -

Mr Uren:

– I rise to order. Mr Speaker, I draw your attention to the ruling which was given by the Deputy Speaker who was in the Chair prior to your coming in. He called the honourable member for Mackellar to order and pointed out that he could not speak about matters relating to the leader of the Opposition but had to confine his remarks to the statement made by the Attorney-General earlier tonight. That statement 4 pages of it- says nothing about any statement made by the Leader of the Opposition, nor do any of the papers which were tabled by the Attorney-General relate in any way to the Leader of the Opposition. I ask you to uphold the ruling of the Deputy Speaker.

Mr SPEAKER:

– The terms of the motion for the suspension of Standing Orders were that so much of the Standing Orders be suspended as would prevent the honourable member for Mackellar speaking without interruption for a period not exceeding IS minutes. The matter to which the honourable member for Mackellar must speak is the statement made by the Attorney-General.

Mr WENTWORTH:

– If that is your ruling, I move that the debate be now adjourned.

Mr SPEAKER:

– I am reminded by the Clerk that the honourable gentleman, having got the call, cannot move the adjournment of the debate. He can ask leave to continue his remarks.

Mr WENTWORTH:

– In that case I seek leave to continue my remarks at a later stage.

Mr Uren:

– I rise to order. The honourable member for Mackellar resumed his seat and I believe, therefore, that the call should be on this side of the House.

Mr SPEAKER:

-The honourable gentleman has asked for leave to continue his remarks. The Deputy Leader of the Opposition understands the forms of the House. They are quite clear. The honourable member for Mackellar has sought leave to continue his remarks at a later time.

Mr Uren:

– We refuse leave.

Mr SPEAKER:

– You refuse leave? All you are doing is enticing the honourable member for Mackellar to continue speaking which, I understand, is what you do not want him to do. I call the honourable member for Mackellar.

Mr WENTWORTH:

-Mr Speaker -

Mr Uren:

– The honourable member for Mackellar had been given the call. Because of your ruling he moved a motion and then resumed his seat. You ruled against his motion. The call then should be to this side of the House.

Mr SPEAKER:

-But he was not able to move the motion which he wanted to move. Therefore, he still has the call and, with the call, he has asked for leave to continue his remarks. I would like the Deputy Leader of the Opposition to tell me exactly what course he wishes to be pursued. Does the honourable gentleman want the debate to continue?

Mr Uren:

– I believe that, having resumed his seat after moving a motion that he was not entitled to move, the call should have been given to this side of the House.

Mr SPEAKER:

-No. The honourable gentleman moved ‘That the debate be now adjourned ‘. He was not entitled to so move and I so ruled. He then sought leave to continue his remarks at a later time. I understand that the Deputy Leader of the Opposition has refused him leave. So I call the honourable member for Mackellar.

Mr WENTWORTH:

-Thank you, Mr Speaker. Earlier in this debate the members of the Opposition were very vocal in calling for an inquiry into certain things and raised a number of topics which were irrelevant to the paper brought forward by the Attorney-General. I want to test their sincerity in this regard. I was saying that, while they were calling so vociferously for an inquiry into matters of smaller moment, they were inclined to swallow matters of much graver moment, that is, the charges that have been levelled against the Leader of the Opposition. I went on to say that by their conduct in this House and elsewhere they were endeavouring to prevent the truth about those charges being made known to the House and the public. I understood- perhaps wrongly- that -

Mr Scholes:

– I rise to a point of order, Mr Speaker. The honourable member for Mackellar is again ignoring the rulings of the Chair. He is speaking about the subject matter about which he was asked to desist from speaking by Mr Deputy Speaker and yourself on a number of occasions. He is now, as is not unusual, using a debating device in order to make exactly the same remarks.

Mr SPEAKER:

– I will listen carefully to the honourable member for Mackellar (Honourable members interjecting)

Mr SPEAKER:

-Order! The House will come to order and hear the honourable member for Mackellar in silence.

Mr WENTWORTH:
MACKELLAR, NEW SOUTH WALES · LP; IND LIB from Oct 1977

-Thank you, Sir. I was endeavouring to test the sincerity of the Opposition by pointing out that while -

Mr Scholes:

– Make the statement outside. That is a test of your sincerity. The last time you did that you had to apologise. If you do it now you will be in gaol.

Mr SPEAKER:

-Order! The honourable member for Corio knows that he is not entitled to make that sort of comment and I ask him to withdraw it.

Mr Scholes:

– I withdraw the remark and apologise to you, Sir. I believe that an honourable member should be prepared to make such a charge against another member outside the House.

Mr SPEAKER:

-Order! The honourable member will not argue the point.

Mr Bourchier:

– Why does the Leader of the Opposition not do that?

Mr SPEAKER:

– The Government Whip will cease interjecting.

Mr WENTWORTH:

– I was pointing out that I did not make the charges; they were made by someone else.

Mr SPEAKER:

-Order! The honourable member for Mackellar will make his remarks relevant to the statement.

Mr WENTWORTH:

– I am endeavouring to do just that, Sir. I am referring to the sincerity of the members of the Opposition in this debate and I think that, looking at the course of this debate, I am entitled to do so. I am entitled to say that they are obviously insincere in calling for an inquiry into lesser matters while they are so keen to avoid an inquiry into the conduct of their own Leader on matters which are much graver. It is relevant that I should bring up those things which relate to the sincerity of the Opposition in the debate. The charges which have been made and to which I want now to refer in passing -

Mr SPEAKER:

-Order! The honourable gentleman will not be in order in referring to the charges. He can refer to the statement.

Mr WENTWORTH:

– I want to refer to their gravity, Sir, because this is a matter which relates to the sincerity -

Mr Young:

– I raise a point of order, Mr Speaker.

Mr WENTWORTH:

– I take a point of order, Mr Speaker. The resolution of the House is that I be heard without interruption.

Mr SPEAKER:

-The honourable member for Port Adelaide will make his point of order.

Mr Young:

- Mr Speaker, this Government is in power as a result of the way in which Rupert Murdoch and company -

Mr SPEAKER:

-Order! The honourable member will resume his seat.

Mr Young:

– . . . exploited -

Mr SPEAKER:

-The honourable gentleman will resume his seat.

Mr Young:

- Mr Speaker, I have a point of order to raise.

Mr SPEAKER:

– If you have a point of order to raise I will give you an opportunity to make it.

Mr Young:

- Mr Speaker, the point of order I make is that you have told the honourable member for Mackellar, the greatest old phoney in this House -

Mr SPEAKER:

-Order! The honourable gentleman will resume his seat. I am quite sure that honourable members wish Parliament to be conducted in a proper fashion. The honourable member for Mackellar will remain relevant. If he does not remain relevant to the subject matter of the debate I will have to continue to draw that to his attention because he has time to speak. I ask the honourable member for Port Adelaide to withdraw the statement that the honourable member for Mackellar is an old phoney.

Dr Klugman:

– He is not really old.

Mr Young:

- Mr Speaker, of course I bow to your ruling -

Mr SPEAKER:

-That will be enough, thank you.

Mr Young:

– . . . but he did vote against the pensioner funeral benefit.

Mr SPEAKER:

-The honourable member will resume his seat. The honourable member for Prospect will withdraw his remark.

Dr Klugman:

-What, the ‘old ‘ bit?

Mr SPEAKER:

– Yes. It is rather difficult, but the honourable member for Prospect was not being parliamentary in his interjection. I ask him to withdraw it.

Dr Klugman:

– I withdraw it. All I said was that he was not really old.

Mr SPEAKER:

– That will do. I ask the honourable member for Prospect to resume his seat. I call the honourable member for Mackellar.

Mr WENTWORTH:

- Mr Speaker, I ask for your protection. The resolution of the House was that I be heard for 15 minutes without interruption. I take it that that means that I shall be heard for 15 minutes without points of order being taken or other interruptions. I have not had the protection to which I think I am entitled in view of the resolution which the House carried. I ask you, Sir, to afford me that protection.

Mr SPEAKER:

-The honourable member for Mackellar knows the ruling which has been given. He must remain relevant to the subject matter. If he does not remain relevant, it is not surprising that honourable members on the other side will raise points of order. The honourable member’s time has expired.

Motion (by Mr Sinclair) put:

That the question be now put.

The House divided. (Mr Speaker-The Hon. B. M. Snedden, Q.C.)

AYES: 77

NOES: 25

Majority……. 52

AYES

NOES

Question so resolved in the affirmative.

Original question resolved in the affirmative.

page 2072

BILLS RETURNED FROM THE SENATE

Mr SPEAKER:

– I have received messages from the Senate returning the following Bills without amendment:

States Grants (Schools) Bill 1976

Defence Force Retirement and Death Benefits (Pension Increases) Bill 1976.

page 2073

APPROPRIATION BILL (No. 3) 1975-76

Second Reading

Debate resumed.

Mr GRAHAM:
North Sydney

– I rise to support Appropriation Bill (No. 3) and Appropriation Bill (No. 4). I remind the House that m these Bills the Treasurer (Mr Lynch) has asked the Parliament to appropriate moneys additional to those appropriated under Appropriation Act (No. 1) and Appropriation Act (No. 2) of 1975-76 totalling in ail $506,201,000. Of this total, $344,430,000 is sought in Appropriation Bill (No. 3) and $161,771,000 is sought in Appropriation Bill (No. 4). The Bills seek parliamentary authority to make payments under specified heads of expenditure, the need for which has arisen since the Budget was prepared. The appropriations provided in Appropriations Act (No. 1) and Appropriations Act (No. 2) were insufficient for some purposes. Provision is also being made for moneys to be appropriated under heads of expenditure for which no provision was made in those Acts.

The amounts included in the Bills are needed to meet the commitments made by the former Government as well as commitments made for essential and unavoidable expenses under the authority of the present Government. While it is necessary to provide further appropriations to meet certain expenditures which we consider to be inescapable, I am pleased to be able to say that the savings, as the Treasurer has advised us, under other annual appropriations of the Consolidated Revenue Fund, are expected to total $478.2m. From that basis the debate has ranged very widely. I had intended to devote my speech or as much of it as was available to me, having regard to the circumstances of the moment, to a discussion of the economic policies of the Government and the circumstances which have led to the development of those policies during the last 3 years.

In view of the speech of the Leader of the Opposition (Mr E. G. Whitlam) just before the sitting was suspended for dinner and having regard to the circumstances at this time, I would like to begin by dissociating myself from any of the comments that the honourable gentleman has made concerning the late Senator the Hon. Sir Shane Paltridge. I feel quite sure that there are many members of the Australian Labor Party, both in this place and in another place, who would like to see exactly the same thing, particularly if they knew the late senator during the many years of his long and meritorious service in this Parliament. In those circumstances, I felt that at the very beginning of the debate I would speak to it. I understand that members of the Labor Party have done the same thing.

Debate interrupted.

page 2073

ADJOURNMENT

Retirement of Principal Attendant- Medical Practitioners- Australia Council -Deaths of Australian Newsmen in Timor- Journalists’ Assignments: Travel by Aircraft

Mr SPEAKER:

-Order! It being 10.30 p.m., in accordance with the order of the House of 18 February 1976, 1 propose the question:

That the House do now adjourn.

Mr NICHOLLS:
Bonython

-Mr Speaker, I seek the indulgence of the House to make a personal explanation. I want to make an apology because tonight I named an attendant as being the person who opened the door of the chamber to let out the Prime Minister during a division. My information now is that the attendant did not let out the Prime Minister but that one of Mr Fraser’s staff let him out.

Mr SPEAKER:

-Order! The point made by the honourable gentleman is in explanation of his own statement that the attendant had opened the door. He has now given the House further information. I might reiterate that it is the practice of the House to pair the Leaders of both sides of the House, that is, the Prime Minister and the Leader of the Opposition. The fact is that the Prime Minister was paired and was in the House at the time of the doors being locked. It is the practice of the House to allow the Leaders to leave the House in that event. There was nothing untoward in the matter. As to who opened the door, that is a matter about which I have no information.

I inform honourable members that the Principal Attendant in the House, Mr Sid Riddle, retires on 14 May, which is before the House resumes. Many honourable members will know him as Sid. He is a very fine man, as I am sure everybody who has had anything to do with him is well aware. Mr Riddle joined the Department of the House of Representatives as a junior attendant in 1946. He served as Speaker’s attendant from 1957 to 1967 and was promoted to Principal Attendant in April 1974. He has served the House and honourable members very well indeed, and I am sure that all honourable gentlemen would want me to write to him, congratulating him on his service and offering him the very best wishes of the House for his future.

Mr SINCLAIR:
Minister for Primary Industry and Leader of the House · New England · NCP/NP

With the indulgence of the House, the Government Parties would like to join in wishing the Principal Parliamentary Attendant very many happy years in his retirement. We extend our thanks to him for the long and faithful service he has rendered in this place.

Mr UREN:
Reid

-Mr Speaker, on behalf of the Opposition, I join with the Leader of the House in extending my best wishes to Mr Riddle on his retirement.

Mr SPEAKER:

– I thank all honourable gentlemen. The House will now resume the adjournment debate.

Mr FRY:
Fraser

– I wish to inform the House of one of the most disgusting and sickening examples of public irresponsibility and dereliction of duty by a member of the medical profession in the long history of the conflict that has been going on in Canberra between private and salaried medical officers in Canberra hospitals. Late on Monday night an unfortunate young man named Michael Frodyma was involved in a serious motor accident in Canberra. I understand that during a one and a half hour rescue operation Mr Frodyma was attended by salaried medical staff from the Woden Valley Hospital. He was then taken to the hospital to be prepared for an emergency operation, which later required the amputation of both lower legs. He was being prepared for the operation by a salaried anaesthetist, Dr Heather Lopert. I have been reliably informed that a private orthopaedic surgeon, Dr McGonigal, was called in to perform the surgery. I have been further informed that Dr McGonigal refused to work with the salaried officer to perform the operation of amputation. I believe that the operation was delayed until a private anaesthetist, Dr Allam, was brought in to administer the anaesthetic for Dr McGonigal. According to the latest Press reports, Mr Frodyma ‘s battle for recovery is just beginning. He is still in a serious condition and he has a long hard road ahead of him to recover.

This sorry, sordid and incredible episode clearly demonstrates that the serious conflict between salaried and private practitioners in Canberra hospitals has reached a stage which is quite intolerable to the public of Canberra, and it should be intolerable to the Government. It is a further link in a continuing series of episodes involving deliberate attempts by private practitioners to sabotage the salaried officers services in Canberra hospitals. In their unprincipled attempts to undermine the Government scheme, some private practitioners have shown a cruel disregard for the public interest which should not be tolerated in an enlightened society. It also should be made clear that if the present Government had taken a more responsible attitude towards the salaried specialist scheme the Woden Hospital would have been able to appoint its own salaried orthopaedic surgeon, this unfortunate incident would not have arisen, and private practitioners would not be placed in the situation of being able to hold members of the public to ransom, no matter how serious their injuries, in the fight to maintain their own privileged position in society. I hope that the Minister for Health (Mr Hunt) will conduct an immediate and urgent inquiry into this episode and take appropriate action against such discreditable conduct.

Mr FALCONER:
Casey

– I wish to air the matter of the undercurrent comment and speculation surrounding the position of Dr Jean Battersby the Executive Officer of the Australia Council. Dr Battersby has been the subject of a cowardly and anonymous whispering campaign conducted by people who are not prepared to come out into the open. They choose instead to run a campaign of rumour and innuendo through the columns of the newspapers. I know Jean Battersby personally. I first met her about 9 years ago, although it would be about 4 years since I last saw her. She is highly intelligent, resolute and principled. From that brief association, I believe that she combines an artistic expertise with high administrative competence- a rare combination. In the current underground campaign being conducted within the Australia Council she has been accused of being abrasive and of riding roughshod over others. Is it not strange how we criticise successful women in such terms? A Margaret Thatcher becomes ‘the Iron Lady’. A Margaret Guilfoyle becomes ‘the Iron Butterfly’. Behaviour which represents commendably strong leadership and resolve in a man is seen as unladylike and unacceptably dictatorial when exhibited by a woman. I venture to suggest that, whatever faults Jean Battersby has as an administrator- she might well have faultsshe would not be subject to the same criticism if the name was John Battersby

The complaints about her administrative style must be seen in the context of the peculiar difficulties of arts administration. I am in no position to comment on the truth or otherwise of any specific complaints. What I want to do is to point out the difficulties confronting an arts administrator. The first difficulty is that of resolving the conflicts and tensions that arise between the need for efficient administrative and financial control on the one hand, and the artistic temperament on the other. Indeed, some people would say that the term ‘arts administrator’ is a contradiction in terms. Many artists, by temperament, feel constricted by the need to observe the accounting and administrative procedures usually required where taxpayers’ funds are at stake. Dr Battersby herself has been quoted in the Sydney Morning Herald- a newspaper which has given more than average coverage to the problems in the Australia Council- as saying:

The field of public administration of the arts is a fairly turbulent area compared with the administration of housing … Or perhaps, it just seems this way to me from where I sit.

I suggest that a recipe comprising a mixture of money, administrators and artists, garnished with a social gadfly or two, has a very low boding point.

The second major difficulty, as I see it, is the problem of establishing some measure of success or failure, when trying to evaluate the work of the Council. In a commercial enterprise, profit is one measure. In many non-commercial operations, one can establish various measures of cost effectiveness. But what measure of cost effectiveness can one use with respect to grants to the arts? How does one conclude that the work of a young artist applying for a subsidy will contribute to the social good in a way that justifies a contribution from taxpayers’ funds? I am not opposing such grants; indeed, I support them. I am merely pointing out the lack of clear definition in this area, a lack of clear definition which enables those who have unsuccessfully applied for a grant to find some basis for any resultant hurt or disaffection they might feel about the Australia Council and to find some supporters for their view. The Australia Council has become well known and has attracted an increasing number of applications for assistance to various artists or artistic groups. It seems inevitable that resentment will build up among the increasing number of applicants to whom the Australia Council must say ‘No’.

I would make this appeal to those who would criticise Dr Battersby in their anonymous but personalised way: If you must make criticisms, have the courage to attach your name to the criticism, or be silent. If you do have criticisms, put them forward in a way that helps us to evaluate the progress and contribution made by the Australia Council, so that informed and responsible policies can be evolved. There have been specific criticisms of the 1973-74 accounts of the Australia Council made by the Public Accounts

Committee of this Parliament. Those criticisms must be noted and assessed. But that was, in many respects, a transition year for the Council. What we must have now is some calm and informed comment on the development and activities of the Council since that time. I invite the anonymous critics to undertake that task.

Mr UREN:
Reid

-Mr Speaker, I want to press a matter which I raised with the Prime Minister (Mr Malcolm Fraser) at question time this morning. This is the visit to Australia of Mr Jose Martins, the former President of the Kota Party of East Timor. As honourable gentlemen know, Mr Martins came to Australia earlier this week at the invitation of the Australian Journalists Association. It should be stressed that the AJA also paid Mr Manins’s expenses. I do not want to go into detail on facts which should be well known to everyone in this House.

Briefly, Mr Martins has thrown new light on the deaths of 5 Australian television journalists at Balibo, East Timor, late last year. In particular, he has challenged the official version of how these young men met their deaths. The conventional view which has been pushed hard by the Department of Foreign Affairs is that these 5 men met their deaths by misadventure. According to this version, they were accidentally killed when they were caught in a crossfire during the capture of Balibo by Indonesian troops. Mr Martins has stated in the strongest possible terms that this is not true. He has said that the journalists were gunned down quite deliberately and quite callously by Indonesian troops.

According to Mr Martins, they died in cold blood as the result of a premeditated order by the Indonesian commanders. These officers knew that Australian newsmen were in Balibo and they ordered their men to kill them. There can be no doubt about this; Mr Martins has stated it in the bluntest possible terms. He has stuck to his story under persistent questioning. Furthermore, he has brought to this country a grisly testimony in the form of bone fragments. Mr Martins claims that he collected these bones after the bodies of the newsmen were burnt.

It is not my role to cross-examine Mr Martins or to try and establish conclusively the value of the evidence he has put forward. There is no doubt in my mind that Mr Martins is a man of great courage. It is true that he has switched sides from strong support for Indonesia to extreme hostility. At the same time he has taken grave risks in pushing the question of the Australian newsmen in the way that he has. He has come to

Australia and he has brought evidence with him, and for these reasons he must be taken seriously and heard.

The Australian Journalists Association is trying to get at the truth of the deaths of five of its members. Why shouldn’t this Parliament? In my view, it should be put to the Joint Parliamentary Committee on Defence and Foreign Affairs. In particular, Mr Martins must stay in Australia and be given the chance to put his allegations to this Parliament through the Joint Committee. For this reason, I urge the Government to extend Mr Martins ‘s visa and arrange for him to appear before the Joint Parliamentary Committee on Tuesday, 1 1 May. At question time this morning I urged this course on the Prime Minister. Mr Fraser made it clear that he thought it should be left to the AJA and the Department of Foreign Affairs to interview Mr Martins.

In my view, this approach is completely unsatisfactory. I do not challenge the integrity of the AJA: to my mind it has gone to extraordinary lengths to hunt out the truth on this matter and to safeguard the interests of its members and their families. I made clear in the House on Tuesday that I do challenge very strongly the integrity of the Department of Foreign Affairs on this matter. As I said on Tuesday, there is no doubt in my mind that people in high places in the Foreign Affairs Department conspired to mislead the Australian Government and the Australian people on this issue. This is not a blanket condemnation of the Department of Foreign Affairs; I acknowledge the integrity of most of these officers. On all the evidence, there is an element of officers who have disregarded the rules of impartial advice. They have taken sides with the Indonesian Generals.

Mr Martins has said repeatedly that on two occasions he gave information on the deaths of the 5 newsmen to Foreign Affairs Department officers. The first time was in Geneva and the second in Lisbon. If this is correct, there is reason to believe that this information was transmitted back to the Australian Government either incompletely or in a distorted form. Mr Martins has also claimed that this information was conveyed to the Indonesian Government by the Foreign Affairs Department. Again it is not my job to test these claims; it must be plain, however, that what Mr Martins has said raised grave suspicions about the Department’s involvement in the tragic aftermath of the Balibo invasion.

For this reason our Foreign Affairs Committee should interview Mr Martins. It should not be left to the Foreign Affairs Department. WeI do not want Caesar judging Caesar. In my view, the proper course is for Mr Martins to be invited to appear before the Joint Committee on Defence and Foreign Affairs of this Parliament.

Mr DEPUTY SPEAKER (Mr Lucock)Order! The honourable member’s time has expired.

Mr SHORT:
Ballaarat

– I want briefly tonight to draw to the attention of the House the major problems facing many rural industries in my electorate of Ballaarat and surrounding areas. This applies particularly to the beef, sheep and dairying industries. There are various reasons for these problems- unrealistically low prices, lack of markets, inflation due to the extravagances of the previous Government and the lack of stock feed due to drought conditions. Rainfall in the first 4 months of 1976 in my part of Victoria is amongst the lowest ever recorded. Several inches of rain are needed quickly or there will be little or no feed for stock during the winter. Already many head of stock are being shot because farmers cannot afford to buy feed. The feed for one week frequently costs more that the gross price that the stock brings at market, and that excludes the transport cost of getting it there. Recently in my electorate one farmer sold 50 sheep and got a gross return of $2.50 for the lot.

The problems are too great and diversified to deal with anywhere near adequately tonight. I therefore will restrict my remarks to the essentials. Several of these industries have long term problems that they, together with government, will have to tackle. Some of these- for example, forms of better production control and marketing methods- essentially are matters for the producers themselves to work out. Others- for example the development of better and more assured access to overseas markets- are very much a matter for government in co-operation with producers. These medium to longer term problems, by definition, can be solved only in the medium to longer terms, but there are immediate problems.

Improved unemployment benefit criteria for farmers will help, but there still will be a cash flow crisis. This present problem is hitting the younger innovative farmers when the average age of farmers is increasing disturbingly. Low prices and lack of feed make it impossible to switch from one production to another. Many farmers are now below the poverty level, having nil or negative incomes. I am pleased to note the improved prospects for some products; for example, on the beef markets. As well, the

Government has first and foremost as a number one priority a reduction in inflation and that, too, will help. But these aspects will not solve the immediate problem.

The Minister for Primary Industry (Mr Sinclair) is desperately worried and is working hard on the problems. I wish to put to him the urgent need for the closest co-operation with the Victorian Government to examine and to deal with the immediate problems of cash flow. What producers need is access to finance. The rate of interest is important, but the sheer availability of funds is even more important. This does not necessarily suggest that the Government need be the provider of that finance. But there is a responsibility on the Government to persuade the banking and finance industry to look sympathetically at the present position.

It is people who are involved in this crisis, not just rural products. It is a human problem, not just an economic problem. However, even looking just at the economics of the matter, I point out that several of the rural industries most affected, and in particular the beef industry, are amongst the most efficient of our industries in Australia and indeed in the world. It would be tragic if these industries were to be permanently damaged by the present confluence of disastrous circumstances. It must not happen. As a related issue, I wish to raise the question of the relationship of the prices received by rural producers for their products, particularly stock, and the prices that are being paid by consumers at the retail level. To me there is a very great discrepancy between the two. It is one that I find extremely difficult to understand. I hope that the Government will look very closely at the possibility of instituting an inquiry in this area.

Mr Les Johnson:
HUGHES, NEW SOUTH WALES · ALP

-The matter that I wish to raise briefly concerns the administration of the Minister for Post and Telecommunications (Mr Eric Robinson). It is a matter that is having a very serious effect on the delivery of news presentation in Australia. Journalists and cine cameramen employed by the Aus.tralian Broadcasting Commission are refusing to go on any unscheduled flights- that is, charter flights. Royal Australian Air Force flights or Service flights- because of the pitifully inadequate reimbursement that their families would receive in the event of death or injury. I am told that the Government has forbidden the ABC to provide life assurance for employees engaged in unscheduled or hazardous flying. It apparently has told the ABC that its employees must fall in line with the compensation offered the families of other public servants under the Air Accidents (Australian Government Liability) Act 1963-1973. This Act provides a sum of $30,000 to an employee’s family if he is killed in an unscheduled flight.

Until recently, the Australian Broadcasting Commission has provided life assurance of $18,000 and has arranged with the assurance company providing the cover to extend an extra $20,000 at nominal rates to be taken up privately by the employee. This total of $38,000 has become obviously inadequate, particularly when compared to the still inadequate $75,000 provided to newspaper journalists and cameramen under similar circumstances in the Metropolitan Dailies Award. However, even this $38,000 coverage has been discontinued on instructions from the Federal Government. The ABC has stopped also a special coverage of $50,000 for overseas correspondents on hazardous assignments in such places as Belfast and the Middle East, including Lebanon.

The Air Accidents (Australian Government Liability) Act is so constructed as to absorb any additional assurance carried by the employee. Thus, if the employee carried personal assurance of, say, $20,000, that sum would be deducted from the $30,000 available to the employee’s family in the event of death, and the Government would provide $10,000 only. Thus, even if an employee wished to take out his own personal assurance to provide, say, $20,000 more than the Act would give, he would have to insure for $50,000, carrying $30,000 worth of useless premiums. The situation is complicated also by the fact that most personal life assurance policies have an ‘out’ clause exempting the insurance company from liability in the event of death on an unscheduled flight.

More often than not, Australian Broadcasting Commission journalists and cameramen called on to undertake unscheduled flying assignments are flying in conditions that are hazardous in themselves. For instance, they are using helicopter or service flights to cover natural disasters such as floods or bushfires and charter flights to flood-bound airstrips or remote locations not serviced by regular airlines. ABC cameramen at meetings in Sydney and in other States have decided not to fly unless they are provided with life assurance of at least $125,000 on unscheduled nights. Following meetings of journalists in Sydney and other State capitals the Australian Journalists Association has instructed its members employed by the ABC not to undertake any unscheduled flying until an adequate cover is provided. The Sydney meeting advised the AJA that it felt that such a cover would be based on a sum calculated at 10 years salary at B grade journalists’ rates. It was felt that a sum based on salary rates rather than a flat amount would guard against erosion of the value of the insurance through inflation.

The journalists also asked the AJA to seek provisions similar to those in the Metropolitan Dailies Award by which the employer must indemnify the employee against invalidation of his own personal life assurance policies through unscheduled flying. The ABC, with its journalists and cameramen grounded for all but scheduled flights, has been negotiating with the Public Service Board for the right to provide its own life assurance again, but so far these negotiations have been unsuccessful. The AJA is also asking the ABC to provide adequate life assurance for journalists on other hazardous assignments both in Australia and overseas. I sincerely hope that the Minister for Post and Telecommunications might have an early look at this matter to see that justice is done and so that the Australian public will not unfairly be deprived of an effective news presentation which is at present occurring as a result of this dispute.

Mr YATES:
Holt

-Tonight I should like to discuss the moral and strategic implications to this nation of overseas aid. I remind honourable members and I remind myself that no political Party has the monopoly of compassion. Most of us here have received letters from many friends and many people connected with overseas aid. The majority of us have received pleas from the churches and church leaders. Historically I suppose we could say that overseas aid had its origins in the efforts of the old colonial powers to maintain their settlements abroad. In this generation it is correct to say that overseas aid is exemplified first by the Marshall Plan- a child of the generous people of the United States. Recently 2 world factors have caused a serious problem for us all- the population explosion and unemployment. So overseas aid has become one of the most pressing issues of our time. Indeed, in 1965 Mr Paul Hoffman of the United Nations Economic and Social Council accurately forecast what was going to happen in the sub-continent of India and South-East Asia.

Australia is a small nation situated amidst all this confusion. It is the only developed area in the South Pacific. Therefore the mantle of overseas aid has fallen upon us in such a way that it is not simply a moral duty but one of national survival. I trust that this robe will not become like the robe of Nessus. Let me say straight away that the record of Australian aid is one of the best possible in the world. Starting with the Colombo

Plan there is absolutely nothing about which this nation can feel ashamed where aid to Papua New Guinea or South-East Asia is concerned. Our present problem, of course is now more urgent in regard to aid for Africa. The Government must start thinking about this. Overseas aid takes many forms- grants, food, international bodies and projects. I am particularly interested in the remarks of the honourable member for McMillan (Mr Simon) about what we should do with all the dried milk. I suggest that the Commonwealth Scientific and Industrial Research Organization should have a look at the matter and see whether we cannot convert this milk into tablet form. Overseas aid in 1974-75 was $328m. This year it will be $352.9m-0.5 1 per cent of the gross national product. This is well on the way to what we promised the United Nations. I am perfectly convinced that unless inflation is brought under control and the economy is put on a sound basis there will be no foreign aid. So I say to my friends in the schools, universities and churches: ‘Remember this one thing: A Liberal government will honour Liberal philosophy. Even if now we have to defer the action of giving full foreign aid we will take it later’. I am quite certain that those listening to me will understand that this is only a short transitory period and the Government in due course will take steps to see that its commitment is fully honoured.

Mr DEPUTY SPEAKER (Mr Lucock)Order! It being 1 1 p.m., I put the question:

That the House do now adjourn.

Mr Yates:

- Mr Deputy Speaker, may I speak a little longer?

Mr DEPUTY SPEAKER:
Mr HUNT:
Minister for Health · Gwydir · NCP/NP

- Mr Deputy Speaker, I require the debate to be extended. I rise to reply to the remarks made by the honourable member for Fraser (Mr Fry). I thank him very much for giving me notice that he would be raising the matter that he raised tonight. I, too, extend my sympathy to the victim who was so badly injured in the motor car smash in Woden on Monday night. I have heard several accounts of the incident. If the report referred to by the honourable member for Fraser is correct, I can only express my sorrow and horror. I give the honourable member an assurance that I have called upon the Australian Capital Territory Health Commission to furnish me with a report on the incident as a matter of urgency.

Unfortunately, the former Government created divisions amongst the salaried and private specialists in the Australian Capital Territory. Most of the doctors, salaried and private alike, in Canberra are men of good will. There are extreme views amongst them on both sides. One thing is abundantly clear In the public interest and in the professional interest there must be a speedy reconciliation so that the doctors can work as a team in the public interest. I have already spent some considerable time since the change of government in trying to improve the relationship and in creating an atmosphere of trust amongst the Canberra doctors, salaried and private. I will continue to devote my energies to achieving this reconciliation amongst the Canberra doctors.

To this end I have asked both the Council of

Salaried Specialists in the A.C.T. and the Aus.tralian Capital Territory Medical Association to join me in a round table conference at the earliest opportunity so that they can play their part in devising regulations and rules under which they themselves can work together in the Canberra hospitals in the public interest.

Mr DEPUTY SPEAKER:

-The House stands adjourned until Tuesday, 18 May 1975, at 2.15 p.m., unless Mr Speaker shall by telegram or letter addressed to each member of the House fix an earlier day of meeting.

House adjourned at 11.3 p.m.

page 2080

ANSWERS TO QUESTIONS UPON NOTICE

The following answers to questions upon notice were circulated:

International Wheat Council: Cereal Reserve System (Question No. 104)

Mr Lloyd:
MURRAY, VICTORIA

asked the Minister for Overseas Trade, upon notice:

  1. 1 ) Was Australia represented at the International Wheat Council meeting held on 29 September 1975.
  2. If so, what proposals did Australia put before the Council for a cereal reserve system.
  3. What was Australia’s attitude to the United States’ proposal for a reserve of 30 million tons.
Mr Anthony:
NCP/NP

– The answer to the honourable member’s question is as follows:

  1. 1) A meeting of the International Wheat Council’s Preparatory Group was held in the week commencing 29 September 1975. Australia participated in that meeting, the third in a series of meetings of the Group. The most recent meeting was held on 19-21 January 1976. The Preparatory Group, which was established largely as a result of an Australian initiative, is charged with examining possible bases for a new international arrangement to replace the current International Wheat Agreement. It reports to the International Wheat Council. Its work is exploratory in nature and designed to prepare the way for a negotiating conference. A technical sub-group of the Preparatory Group has now commenced an examination of the technical issues involved in proposals which have been advanced for the incorporation of various provisions in a new agreement.
  2. The Preparatory Group has examined 20 papers submitted by individual delegations and by the IWC Secretariat. These included an informal paper by Australia outlining a possible role for a system of price triggers in an international arrangement containing provisions for the accumulation and release of reserve grain stocks. The paper also referred to the need for a system of consultations to co-ordinate action by exporters and importers and also to safeguard commercial grains markets. The concept of price triggers has since been refined considerably by the Secretariat in subsequent discussion in the Preparatory Group but there is, of course, no commitment to include price triggers as a mechanism in a new Agreement.

A further paper was circulated by Australia at the January meeting of the Group. This paper concluded that, in the light of differences within the Group concerning the operation of a reserve stocks scheme, more work needed to be carried out. This work commenced when the technical sub-group of the Preparatory Group met on 24 March. Australia was represented at this meeting.

  1. The U.S. proposal for a reserves scheme was discussed at the Preparatory Group meeting on 29-30 September 1975 but was considered by other members of the Group to be inadequate by itself as a basis for a new international grains arrangements. Nevertheless, Australia welcomed the U.S. proposal as a contribution to further discussion and clarification of the issues involved in ensuring greater world food security. The Australian delegation to the January meeting of the Preparatory Group put Australia’s view that world food security could be best assured by a package of measures which would ensure the availability of stocks and the flow of supplies to world markets, and suggested that any agreement would need to provide a balance of benefits for both producers and consumers by dealing with both shortage and surplus situations. The U.S. proposal appears to emphasise a shortage situation. The Australian delegation argued that to the extent that the concept of world food security involves ensuring that adequate production is forthcoming. Any new agreement will need to involve mechanisms aimed at avoiding situations in which efficient producers do not receive adequate prices for their product on world markets. The U.S. proposal does not contain any direct reference to price.

The U.S. has suggested a reserve figure of 30 million tonnes of grain. However, it is generally accepted that the reserve stock level which might be incorporated in any agreement would be a matter for negotiation

Natural Disaster Insurance Scheme (Question No. 207)

Mr Lloyd:

asked the Treasurer, upon notice:

  1. Will the proposed Natural Disaster Insurance Scheme include grain and horticultural crop losses from either flood, hail, fire or drought.
  2. ) What other forms of agriculture will be included in the scheme, and what other forms of natural disaster.
Mr Lynch:
LP

– The answer to the honourable member’s question is as follows:

  1. I ) and (2) In a statement on 4 March 1 976 I announced that the Government had decided in principle to introduce a natural disaster insurance scheme and had approved the establishment of a working party of officials to formulate a scheme in consultation with the insurance industry.

The working party’s terms of reference do not extend to consideration of the question of insurance of grain and horticultural crop losses against natural hazards. This question has been under separate consideration for some time and the working party has been asked to keep in mind that any scheme introduced following completion of its task should be capable of being associated with whatever arrangements that might be decided upon regarding the insurance of crops.

As pan of this separate examination of crop insurance, the insurance industry, through its Insurance Conference Committee, is examining the feasibility of establishing an insurance pool for the purpose of increasing the availability of natural disaster crop insurance.

In addition, the Industries Assistance Commission is conducting an inquiry into rural income fluctuations, and its findings should be relevant to natural disaster insurance for agricultural products.

Any Government decision on the question of natural disaster insurance for agricultural products would be made in the light of the reports of the Insurance Conference Committee and the Industries Assistance Commission.

Butter and Oilseeds Industry (Question No. 217)

Mr McVeigh:
DARLING DOWNS, QUEENSLAND

asked the Minister for Primary Industry, upon notice:

  1. Are the butter industry and oilseeds industry in Australia facing unfair competition from margarine manufactured from cheap imported palm and coconut oil.

    1. If so, is this oil produced under coolie working conditions in Malaysia where the workers earn between the equivalent of SA2-3 per day.
    2. Is the present Australian duty on these imported oils only 30c per gallon.
    3. Is the price quoted for palm oil approximately SA32 1 a tonne CIF, compared to the price of Australian sunflower and safflower oil of $600 per tonne delivered into store at Sydney.
    4. If these figures are correct, will the Government in order to protect these 2 Australian industries (a) place a quota on imported oils and (b) increase the duty to a realistic figure.
Mr Sinclair:
NCP/NP

– The answer to the honourable member’s question is as follows:

  1. Palm and coconut oils are presently not major ingredients of margarine and would account for only a minor percentage, perhaps 10 per cent, of the total oils and fats used in margarine preparations. They are used principally in industrial and cooking margarines.

Their most common use is for edible products other than margarine for which their specific characteristics make them most suitable. They presently do compete to a degree with domestically produced oils. With the development of new technological processes, palm oil in particular, is becoming more adaptable in its end uses and its competitiveness visavis other oils is expected to continue to increase.

  1. The principal suppliers of these oils to the Australian market are Malaysia in the case of palm oil and Papua New Guinea, Fiji and Malaysia for coconut oil. Almost the entire world output is in tropical developing countries where labour costs generally are significantly below those of developed countries such as Australia.
  2. No. Coconut and palm oils are permitted duty free entry.
  3. The prices quoted are substantially correct. However, palm oil is not a direct substitute for the polyunsaturated sunflower and sufflower oils in many applications. Moreover, in some instances, the cost of palm oil is increased by the need for further refining for particular end uses. Accordingly, a simple comparison of prices for unrefined oil without regard to other factors does not give an accurate indication of the extent to which palm oil is competitive with locally produced oils.
  4. It is the Government’s policy to seek the advice of the Industries Assistance Commission (IAC) or the Temporary Assistance Authority (TAA) on matters related to assistance to industry against import competition. A matter is referred to the IAC or the TAA if it can be demonstrated that a prima facie case exists for reviewing the existing level of assistance. I am advised that the Department of Industry and Commerce recently completed an examination of a request from the oilseed crushing sector of the industry for urgent temporary protection against imports of vegetable oils and concluded that a prima facie case for a reference to the TAA had not been substantiated at that time. However, following further consultations with the industry the Department has undertaken to review the case for a reference to the TAA as soon as additional information is provided by the industry. I am further advised that the Department has initiated discussions with all sectors of the industry concerning the possibility of a reference to the IAC on the long term assistance needs of the industry.

Commonwealth Foreign Investment Committee (Question No. 316)

Mr MacKenzie:
CALARE, NEW SOUTH WALES

asked the Treasurer, upon notice:

  1. What is the present status and purpose of the Commonwealth Foreign Investment Committee.
  2. Does the committee have significant powers through the exchange control mechanism to direct foreign companies to establish operations in Australia away from the major centres of Sydney and Melbourne.
  3. Can the committee be developed as a major vehicle for national decentralisation in Australia.
Mr Lynch:
LP

– The answer to the honourable member’s question is as follows:

  1. 1 ) The previous committee, which was called the Foreign Investment Advisory Committee, was an advisory body only. So too is the recently announced Foreign Investment Review Board (for details, see Hansard of 1 April 1976, pages 1287-1288). It has no executive powers. Decisions on foreign investment matters are taken by the Treasurer after consultation with appropriate Ministers.
  2. and (3) Where exchange control approval is required in respect of a proposal falling within the ambit of the Government’s foreign investment policy, the Reserve Bank has the authority under the Banking (Foreign Exchange) Regulations and section 39 of the Banking Act 1959-1974 to withhold approval until the Government has indicated that the proposal is not inconsistent with that policy.

Foreign investment proposals are considered against the criteria set out in the Attachment to my statement ‘Foreign Investment in Australia’ to the House on 1 April last (see Hansard, page 1290). These criteria include consideration of whether the proposal would conform with the broad objectives of national policies concerned with, among other things, decentralisation and the environment.

Insurance Brokers and Agents (Question No. 327)

Mr Jacobi:

asked the Treasurer, upon notice:

  1. Has his attention been drawn to the recent collapse of a Melbourne insurance broker and agent, K. B. and L. J. Roberts Holdings Pty Ltd.
  2. If so, can he say whether the collapse of this company has left many of its customers without insurance cover.
  3. Can he also say whether a number of insurance companies have been left without premiums having been paid, and liabilities they were not aware of, as a result of the collapse.
  4. In view of the urgent need for legislation and regulation for insurance brokers and agents, will he give urgent consideration to introducing the long promised brokers legislation.
Mr Lynch:
LP

– The answer to the honourable member’s question is as follows:

  1. Yes.
  2. and (3) K. B. and L. J. Roberts Holdings Pty Ltd is not subject to any current Commonwealth insurance legislation and I am, therefore, unable to provide details regarding the company’s trading activities.
  3. I refer the honourable member to a statement by my colleague, the Minister Assisting the Treasurer, on 9 April 1976 announcing the Government’s intention to introduce legislation for the supervision of insurance brokers.

Public Service: Air Travel (Question No. 348)

Mr Bungey:
CANNING, WESTERN AUSTRALIA

asked the Minister for Primary Industry, upon notice:

What sum has been paid by his Department, including the former Department of Agriculture, to each airline for air travel within Australia during the last 2 years?

Mr Sinclair:
NCP/NP

– The answer to the honourable member’s question is as follows:

  1. 1 ) An amount of $265,730 was paid for air travel during the 1973-74 financial year and an amount of $313,540 paid during the 1974-75 financial year.
  2. The amounts paid to each airline during each financial year are as follows:

Department of Health: Purchases of Blankets (Question No. 383)

Mr Bungey:

asked the Minister for Health, upon notice:

  1. What quantities of (a) woollen blankets and (b) blankets made of man-made fibre have been purchased for his Department in each of the last 3 years.
  2. What guidelines currently govern the purchase of blankets for his Department.
Mr Hunt:
NCP/NP

– The answer to the honourable member’s question is as follows:

  1. (a) 1973-74-13 woollen blankets purchased; 1974- 75-50 woollen blankets purchased; 1975- 76,2 woollen blankets purchased

    1. 1973-74-Nil; 1974- 75-Nil; 1975- 76- Nil.

  2. Consideration is given to such factors as climate and location where the blankets are required, e.g. in Northern Territory 4647 cotton (terry towelling) blankets were purchased in 1973-74. Other factors considered include patient comfort, durability, ease of laundering and cost. If contracts are available then blankets on contract are purchased. If contracts are not available then appropriate purchases are made under promulgated purchasing procedures.

Cereal Crops (Question No. 436)

Mr McVeigh:

asked the Minister for Primary

Industry, upon notice:

  1. Have there been discussions within the grain industry to improve the quality of various cereal crops by either imposing a dockage on the production from undesirable varieties or introducing legislation restricting the planting of undesirable varieties.
  2. If so, what initiatives are to be taken in the Commonwealth and State areas to overcome the serious problems due to the production of low quality, undesirable varieties of grain.
Mr Sinclair:
NCP/NP

– The answer to the honourable member’s question is as follows:

  1. and (2) I am informed that there have been discussions over a lengthy period between representatives of the relevant State authorities and the cereal growing industry concerning draft legislative proposals formulated, at the request of the industry, and intended for adoption by all State Governments, designed to control the varieties of cereal crops to be planted and to regulate the harvest, delivery or disposal otherwise of non-registered wheat varieties. More recently these proposals were debated at a Wheat Industry Review Conference which was chaired by a senior officer of my Department and at which representatives of the State Departments of Agriculture and the wheat industry participated.

At that Conference it emerged that the wheat industry had particular difficulty with certain proposals contained in the draft legislation relating to penal sanctions and inspectorial powers. As a consequence, representatives of the Australian Wheatgrowers’ Federation and the Australian Wheat Board are currently examining and developing a concept that the Board might be authorised to adopt a dockage system with a view to discouraging the delivery of varieties undesirable in the market place.

A prerequisite to the adoption of this alternative proposal would be at least its endorsement by State Governments and appropriate amendment of the wheat stabilisation legislation. It is anticipated that a detailed industry plan will be placed before me and State Ministers of Agriculture in due course when the matter will receive consideration in the Australian Agricultural Council.

Army and Cadet Stores: Losses (Question No. 201)

Mr Connolly:
BRADFIELD, NEW SOUTH WALES

asked the Minister for Defence, upon notice:

  1. What losses in (a) arms and (b) ammunition from Army and Cadet stores were reported during 1974-75, and from where were the losses reported.
  2. How many of these arms and what ammunition were recovered, and from where were they recovered.
Mr Killen:
Minister for Defence · MORETON, QUEENSLAND · LP

– The answer to the honourable member’s question is as follows:

  1. 1 ) and ( 2) see following tables.

Motor Vehicle Policy (Question No. 153)

Mr Jacobi:

asked the Minister representing the Minister for Industry and Commerce, upon notice:

  1. 1 ) Does the Minister propose to allow Nissan and Toyota to participate as manufacturers of passenger motor vehicles in the 85 per cent local content plans announced by the previous Government in late 1 974.
  2. Has the Minister’s attention been drawn to the savings in terms of capital costs and consequent efficient manufacture which will flow from the formation of a consortium to produce 4-cylinder engines at Lonsdale.
  3. Is it proposed to impede the progress of this venture by asking the Australian Industry Development Corporation not to join the proposed consortium.
  4. Why has the Minister not responded to the applications by Nissan and Toyota to manufacture passenger motor vehicles in Australia.
  5. Has the Minister’s attention been drawn to the repercussions of this delay on the planning for the future of component manufacturers in Australia who would gain considerable new business from the entry of these companies.
  6. Has the Minister’s attention been drawn to the Industry Assistance Commission’s report on the passenger motor vehicle industry released on 31 October 1975; if so, does it predict that any long-term delay in the re-sourcing of high cost components could threaten the viability of the industry and lead to far greater employment consequences than if there is a return to the very high protection of the past.
  7. Will the Minister give the 85 per cent plans the goahead, and encourage the movement towards more economic activities such as the joint Nissan/Toyo.ta/Chrysler/AIDC engine plant at Lonsdale.
  8. Is it a fact that the uncertainty which presently surrounds the passenger motor vehicle industry is placing in jeopardy a soundly based new venture at Lonsdale in South Australia which would be capable of employing over 1000 additional people initially, and offers prospects for additional related employment in the longer term.
Mr Howard:
LP

– The Minister for Industry and Commerce has provided the following answer to the honourable member’s question: ( 1 ), (4) and (5) The Government has approved the applications of Nissan and Toyota to enter the 85 per cent company average local content Plan subject to these companies sourcing their four-cylinder engines under arrangements that are acceptable to the Government.

  1. The Government is well aware of the advantages of rational development of four-cylinder engine manufacture, rather than fragmented production in several locations. Consequently it authorised the Minister for Industry and Commerce to hold discussions with both established and new manufacturers to explore possible arrangements for production of all Australian requirements of four-cylinder engines, including the proposal for their production at Lonsdale.
  2. The AIDC is free to decide on the basis of its normal criteria whether or not to participate in any four-cylinder engine consortium that may be formed.
  3. Yes. The Government accepted the Industries Assistance Commission’s recommendations on the question of component resourcing.
  4. The Government has adopted an 85 per cent company average local content Plan which incorporates some significant modification of previous arrangements, and is encouraging movement towards more economic activities (see answer to question (2) above).
  5. 8 ) No. The Government ‘s recent policy decisions, which I announced on 30 March 1976, removed a great deal of the uncertainty which has bedevilled this industry in recent years. As explained in (2) above, the question of fourcylinder engine production is under active consideration by the Government and the motor vehicle companies.

Motor Vehicle Policy (Question No. 308)

Mr Scholes:

asked the Minister representing the Minister for Industry and Commerce, upon notice:

  1. 1 ) Does the removal of the non-reversion clause in the passenger vehicle manufacturers plan remove protection from major component manufacturers such as Borg- Warner in Albury-Wodonga.
  2. Will manufacturers be permitted to import panels which are at present manufactured in Australia.
Mr Howard:
LP

– The Minister for Industry and Commerce has provided the following answer to the honourable member’s question:

  1. 1 ) and (2) The essential feature of the 85 per cent company average local content plan for passenger motor vehicles is that vehicle builders undertake to achieve and maintain specified levels of local content in return for duty free entry of residual componentry. Without this concession, there would be no incentive for vehicle builders to participate in the plan and therefore no guarantee that any componentry would be sourced locally. The plan therefore provides a substantial degree of protection to component manufacturers generally, and will continue to do so until at least 31 December 1984. Removal at the end of 1976 of the existing control over reversions will give the vehicle builders freedom to determine which components they will source locally to make up their 85 per cent local content and which they will import to make up the remainder. Whether the imports include panels, transmissions, engines or other componentry will be a matter for the commercial decision of each vehicle company.

Motor Vehicle Policy (Question No. 310)

Mr Scholes:

asked the Minister representing the Minister for Industry and Commerce, upon notice:

Will companies marketing a range of passenger vehicles be allowed to enter selected models under the 85 per cent plan to the disadvantage of existing manufacturers.

Mr Howard:
LP

– The Minister for Industry and Commerce has provided the following answer to the honourable member’s question:

New manufacturers may participate in the Plan initially on the basis of an individual model meeting the local content requirements or on the basis of two or more models meeting the requirements. By-law concessions will not be available for models which have not been entered in the Plan. However, from 1 January 1980, new manufacturers will be required to achieve 85 per cent local content over all vehicles they manufacture or assemble in Australia.

These arrangements will not disadvantage the existing manufacturers.

Motor Vehicle Policy (Question No. 311)

Mr Scholes:

asked the Minister representing the Minister representing the Minister for Industry and Commerce, upon notice:

Over what period will new entrants into the vehicles manufacturers plan be allowed to reach the 85 per cent local content average.

Mr Howard:
LP

– The Minister for Industry and Commerce has provided the following answer to the honourable member’s question:

New manufacturers will be required to achieve 85 per cent local content in accordance with the following timetable: 1 January 1976- 6214 per cent 1 January 1977- 70 per cent 1 January 1978-75 percent 1 January 1979-80 percent 1 January 1980-85 percent

Motor Vehicle Policy (Question No. 312)

Mr Scholes:

asked the Minister representing the Minister for Industry and Commerce, upon notice:

  1. I ) Will manufacturers entered under the New Passenger Car Plan be permitted to import completely-built-up and completely-knocked-down vehicles outside the plan’s operation.

    1. Will these imports be included in the allowed 15 per cent imported content, or treated as separate operations outside the plan.
    2. Will cars imported from parent companies who are in the 85 per cent plan by other than the Australian entrant in the plan, i.e. large retailers or subsidiary or dummy companies, be outside the operation of the plan.
Mr Howard:
LP

– The Minister for Industry and Commerce has provided the following answer to the honourable member’s question:

  1. 1 ) Manufacturers will be permitted to import completelybuiltup vehicles outside the Plan’s operation provided they have allocations under the import quota arrangements which are to apply until 3 1 December 1 976.

In certain circumstances, both established and new manufacturers will be permitted to import completelyknockeddown vehicles outside the Plan’s operation during the phasing period, i.e. until 31 December 1978 in the case of established manufacturers and until 31 December 1979 in the case of new manufacturers. Of course the by-law concessions available for Plan vehicles will not apply to such imports, which will be subject to normal duty and tariff quota arrangements. Following the conclusion of the phasing period, manufacturers will not be permitted to import completely.knockeddown vehicles outside the Plan.

  1. These imports will be treated as separate operations outside the Plan, i.e., to the extent and during the period that Plan manufacturers are permitted to engage in such importations.
  2. The reference to importation by retailers indicates that this part of the question refers to fully assembled cars. Such imports fall outside the operation of the Plan, regardless of the identity of the importer.

Civil Aviation: Commuter Airlines (Question No. 330)

Mr Wallis:
GREY, SOUTH AUSTRALIA

asked the Minister for Transport, upon notice:

  1. Was any direct financial assistance made available by the Australian Government to commuter type airlines during the last 2 years.
  2. If so, (a) what airlines were involved, and what was the amount of assistance received, (b) what was the reason for granting the assistance and (c) in what States do the airlines operate.
Mr Nixon:
LP

– The answer to the honourable member’s question is as follows: ( H Yes, selected commuter operators ( as distinct from airline operators) were given financial assistance. (2)(a)-

  1. To encourage air links to be maintained between rural centres where there appeared to be a need, including air links to centres from which airlines had withdrawn their services because of unprofitability. The financial assistance was granted on the basis that it would be short term and reducing each year.

Bankstown Airport: Aircraft (Question No. 343)

Mr Keating:

asked the Minister for Transport, upon notice:

  1. How many aircraft movements took place at Bankstown Airport (a) in each of the 10 years to 31 December 197S and (b) in each of the first three months of the years 1970- 1976 inclusive?
  2. What proportion of these movements were attributable to (a) trainee pilot training, (b) charter work, (c) aircraft servicing and maintenance and (d) private flying?
Mr Nixon:
LP

– The answer to the honourable member’s question is as follows:

  1. Statistics maintained are not broken down into the details sought. Spot checks of movements over six weeks in 1974 and 1975, however, showed about 2 per cent of movements operating for charter purposes. The majority of other movements are for pilot training purposes.

Cite as: Australia, House of Representatives, Debates, 6 May 1976, viewed 22 October 2017, <http://historichansard.net/hofreps/1976/19760506_reps_30_hor99/>.

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